Lords Sitting of 20 February 1984

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

EH.101 Helicopter
Lord Gainford: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government how far advanced are the plans for the new Anglo-Italian helicopter.
The Parliamentary Under-Secretary of State for the Armed Forces (Lord Trefgarne): My Lords, my noble friend is referring to the EH.101 helicopter which is to be developed under an integrated commercial and military collaborative programme by Italy and the United Kingdom. Memoranda of Understanding were signed last month between the two ministries of defence and the two industry departments. It is hoped that the main development contract can be signed within the next fortnight.
Lord Gainford: My Lords, I thank my noble friend for that Answer. Has he any information about how much of the production work will be done in this country and therefore how much employment prospect is involved?
Lord Trefgarne: My Lords, I anticipate that the production work will be divided about half and half. At its peak the programme should involve employment amounting to about 10,000 jobs which will be either preserved or created.
Lord Beswick: My Lords, is the noble Lord aware that I am happy to congratulate the Government on their decision in this matter? May I also join in the hope and expectation that there will be a flourishing civil business now that the decision has been taken on this joint European project on the military version? Finally, may I ask the noble Lord whether he can assure us, now that this sensible decision has been taken on this joint European project, that we can look forward confidently to a similar sensible and positive decision over the A.320?
Lord Trefgarne: My Lords, the noble Lord will be aware of the Government's general approach to collaborative projects. All of them of course involve an investment of one kind or another from the collaborative partners. That is one of the matters that have to be considered in regard to the other programme to which the noble Lord referred.
Lord Cledwyn of Penrhos: My Lords, while supporting the welcome which has been extended to this project, may I ask whether the noble Lord can indicate to the House where the jobs will be generated? A total
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of 10,000 jobs must be very welcome indeed at a time of unacceptably high unemployment. Can the noble Lord indicate whether these jobs will be found in areas of high unemployment?
Lord Trefgarne: My Lords, the principal contractors are likely to be Westland, the British helicopter company, and Augusta, the Italian helicopter company; so I imagine that the principal creation of jobs will be around and within those companies.
Lord Mayhew: My Lords, can the noble Lord say what is the size of the order, and what other orders are in prospect?
Lord Trefgarne: My Lords, this has yet to be finally decided. The noble Lord will appreciate that deliveries of this newly developed helicopter will not take place for some years, but the programme will be a very substantial one.
Lord Cledwyn of Penrhos: My Lords, if I may intervene again, in view of the noble Lord's last answer, can he say whether the 10,000 jobs will be generated in this country alone or whether they will be shared between this country and Italy?
Lord Trefgarne: My Lords, they will be shared between this country and Italy.
Lord Aldington: My Lords, would it be in order for me, while declaring an interest, to congratulate the Government on this decision? May I ask my noble friend whether he would not agree, in answer to the question about the number of sales, that the vast majority of the expected sales will be in the civil and utility field rather than in the naval field, which also will be very important?
Lord Trefgarne: My Lords, speaking as a defence Minister, I naturally attach importance to both markets to which my noble friend referred. Of course, my noble friend is quite right.
Lord Diamond: My Lords, can the noble Lord say whether the memorandum of agreement to which he referred is to be considered as a treaty, with all that flows from that, or as something of a lower status than that?
Lord Trefgarne: My Lords, I have to confess that I am not quite clear about the answer that I should give to the noble Lord's question. Perhaps I may ascertain the answer and write to him.
Viscount Trenchard: My Lords, would my noble friend go a little further than he did in answer to Lord Aldington's supplementary question, and confirm that the basic helicopter is one of the first instances of defence equipment which will be suitable for a very large civilian market? Also, does he agree that this represents an agreement (of which there have not been too many in the past) between the Ministry of Defence, the Department of Industry and industry itself to combine a civilian market and a defence market and this is to be welcomed in every way?
Lord Trefgarne: Yes, my Lords, my noble friend is quite right. What usually happens is that the military variant is developed first and then the civil variant follows later. In this case both of the variants are being developed side by side.

Bishop Muzorewa: Detention
2.42 p.m.
Lord Paget of Northampton: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are aware that Bishop Muzorewa has now been held in prison without charge for four months, and that it is alleged that at least three months of this detention have been contrary to the laws of Zimbabwe; and whether as fellow members of the Commonwealth they will make representations.
The Minister of State, Foreign and Commonwealth Office (Baroness Young): My Lords, Bishop Muzorewa's appeal has now been heard by the review tribunal, and the Zimbabwe Government have said that they will abide by its decision. The Zimbabwean authorities are aware of public concern in this country.
Lord Paget of Northampton: My Lords, I thank the noble Baroness for a welcome answer.
Lord Cledwyn of Penrhos: My Lords, can the noble Baroness indicate when the result of the review tribunal is expected? Would she not agree that keeping anyone in custody for this length of time is contrary to normal practice and is to be deprecated? Further, would the noble Baroness not agree that it would certainly increase confidence in the Zimbabwe Government if Bishop Muzorewa was either charged and tried or set free?
Baroness Young: My Lords, the noble Lord asked how long it will be before a decision is made. Of course, that is not a matter for us. The tribunal reports direct to the Zimbabwe Government; and, as I indicated in my original Answer to the noble Lord, Lord Paget of Northampton, the Zimbabwean authorities are aware of the public concern in this country.
Lord Broxbourne: My Lords, may I join in the welcome to the latest development in this unhappy saga? Do not the events leading up to it reinforce the plea which I made in last Wednesday's debate in this House for a British Government initiative to our Commonwealth partners to examine the possibility of strengthening the structure of the Commonwealth so as to make more effective the support for human rights and the maintenance of the rule of law? Will my noble friend the Minister urge this course upon her Government colleagues?
Baroness Young: My Lords, I listened with great interest to what my noble friend said in the debate last Wednesday, and of course it has been seen by my right
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honourable friend the Secretary of State. In the present circumstances, it would be wiser to say nothing more than I have already indicated in the House, in the interests of our relationship with Zimbabwe, and the interests of Bishop Muzorewa in particular.
Lord Wigoder: My Lords, has the hearing before the review tribunal finished; and, if so, when?
Baroness Young: My Lords, as I indicated in my Answer to the Question, the appeal has been heard by the review tribunal and we do not know when the answer will be given; but it is a matter that is reported to the Zimbabwe Government.
Lord Wigoder: My Lords, when did the hearing finish?
Baroness Young: My Lords, I do not have the actual date when it finished. We do know that it has been heard.
Lord Brockway: My Lords, would the noble Baroness consider the possibility of the Government taking the initiative in order to get an international convention for human rights, in view of the fact that a United Nations survey shows that 70 countries are denying human rights—unfortunately, many of them our western allies?
Baroness Young: My Lords, I think that the noble Lord's supplementary question is very far wide of the Question on the Order Paper.
Viscount St. Davids: My Lords, is it not true that any country is entitled to make its own laws? Is it not true that it is usually considered by countries that their own laws are good laws? When a country breaks its own laws, is it not pointing the finger of scorn at itself?
Baroness Young: My Lords, I can confirm that what the Zimbabwe Government are doing is not unconstitutional and is not illegal.

Acid Rain
2.47 p.m.
Lord Dean of Beswick: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what are the latest reports concerning the problem of acid rain, and whether any plans are in hand to deal with the situation.
Lord Skelmersdale: My Lords, the most recently published report is that of the Review Group on Acid Deposition in the United Kingdom, copies of which have been placed in the Library. A number of other scientific reports are expected in the next few months, including that of the Royal Society's discussion meeting last autumn on the ecological effects of deposited sulphur and nitrogen compounds. The Government plan to expand further their research on acid deposition.
Lord Dean of Beswick: My Lords, I am grateful to the noble Minister for that reply, but may I press upon him as a matter of urgency that when the Government do have some proposals they put them into effect as quickly as possible, bearing in mind the widespread ravages that acid rain is causing not only to this country but to some of our friendly neighbours in Europe?
Lord Skelmersdale: My Lords, to use a rather unparliamentary expression, I can confirm that the Government will not hang about on this matter. However, I should say that the scientific links between sulphur dioxide and nitrous oxide have not yet been proved to be the cause of the devastating effects that we are seeing in some places in Europe on the growth of trees and the absence of fish in some inland waters.
The Earl of Lauderdale: My Lords, would my noble friend not agree that this is a very complex matter where surprising contradictions arise, such as neighbouring lochs being unequally subject to acidity and one island in the Indian Ocean being worse off than anywhere else in the world?
Lord Skelmersdale: Yes, my Lords, I absolutely agree with my noble friend, which bears out what I have just said about scientific evidence so far being unclear.
Baroness Nicol: My Lords, can the Minister confirm that two of the very clear recommendations in the report to which he referred are being taken seriously? One is the need for more research and the other is the need for long-term funding in order to make more and better research available. Can he confirm that that has been discussed and that there is clear sympathy from the Government towards this view?
Lord Skelmersdale: Yes, my Lords, there is certainly sympathy. This year we spent £1 million on research into the effects and linkage of acid deposition. I confirm that next year it will be considerably more, but I do not yet have the figures available.
Lord Elwyn-Jones: My Lords, in the meantime, could everything possible be done to discourage factories and other premises from expelling sulphur into the air? There is no need for a great deal of research to establish the undesirability of such discharges.
Lord Skelmersdale: My Lords, the noble and learned Lord will know that since 1972 there has been a 30 per cent. reduction in the amount of sulphur dioxide put into the atmosphere. Regrettably, this has not resulted in a reduction in the effects of so-called acid rain. It is unclear exactly what is the cause. Therefore, it would be premature to fix such things as scrubbers to our big factory chimneys, which would be very expensive and which, as far as we can see at the moment, would not necessarily have the desired effect.
Lord Taylor of Gryfe: My Lords, does the noble Lord the Minister recall that about a year ago the same
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Question was put down on the Order Paper in my name, and that at that time we were given the same assurances as we have been given today? Will he take into account the experience of Scandinavia and Germany, which have conducted similar research into the subject? Indeed, the Scandinavians blame the British for the pollution of the Scandinavian woodlands. Will the noble Lord expedite the research into this and take account of the fact that certain European countries have taken positive steps to limit the emissions from power stations of sulphur dioxide?
Lord Skelmersdale: Yes, my Lords, I am well aware that the Scandinavian countries have undertaken research, but they are no nearer a solution than we are in this country. I have already told the House that we plan an increase in funding for research and that we take this matter extremely seriously.
Lady Saltoun: My Lords, are the Government aware that some research being carried on in this country at the moment not only does not prove that there is a linkage between acid rain and the kind of damage imputed to it but suggests strongly that the causes of the damage are quite different?
Lord Skelmersdale: Yes, my Lords; I have read papers from various sources giving a different series of views. This is exactly the problem.
Lord Leatherland: My Lords, can the Minister tell me whether, as this acid rain falls upon the reservoirs from which we get our drinking water, there is danger in our continuing to drink water?
Lord Skelmersdale: Absolutely none, my Lords.
Lord Dean of Beswick: My Lords, the noble Lord the Minister will be aware that there have been responsible programmes on television indicating the appalling damage that has been done by acid rain to vast areas of beauty, not only in this country but on the continent as well. It is undeniable that we as a nation are the biggest contributor to this. When the Government decide on some action, will the noble Lord press them to act swiftly because of the damage that is being inflicted?
Lord Skelmersdale: My Lords, I can only repeat the answer that I gave the noble Lord in response to his first supplementary question.
The Earl of Lauderdale: My Lords, is my noble friend aware that the Central Electricity Generating Board, in its laboratories in Surrey, is eager to meet any Members of this House or of the other place to tell them what it is doing about exploring the sources of acid rain, and that the results so far are very confusing?
Lord Skelmersdale: No, my Lords, I was not aware of that; and I am very grateful to my noble friend for the information.

Demonstration: Central London Traffic Disruption
2.53 p.m.
The Earl of Halsbury: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government why a politically-orientated demonstration was allowed to block motorised access to the Palace of Westminster during mid-morning to early afternoon of Tuesday 24th January; what warning, if any, was issued to the public that traffic in central London would be immobilised during this period; and when and by what means that warning was issued.
The Parliamentary Under-Secretary of State, Home Office (Lord Elton): My Lords, the Commissioner of Police of the Metropolis has told my right honourable and learned friend the Home Secretary that on 24th January a march of about 15,000 people, organised by the "Save Local Government Campaign", went from Hyde Park to Jubilee Gardens. The march began at 12.15 pm and took some three hours to complete its route. There was some traffic disruption, which the police sought to minimise by signposting traffic diversions and by closing and opening roads as the march passed. All officers employed on traffic duty were instructed to assist the passage of Members of Parliament. The march did not contravene the directions given by the commissioner to his officers, in pursuance of the sessional orders of your Lordships' House and of another place, to facilitate the passage of Members to and from both Houses. The police placed signs giving advance warning of the likely traffic difficulties to motorists at 44 strategic points in central London on 16th January. In addition, local radio stations broadcast the information in motoring bulletins in the evening of 23rd January and on 24th January.
The Earl of Halsbury: My Lords, in thanking the noble Lord for his Answer to my Question, may I ask him this? Would not my Question and his Answer have been more topical, albeit below the level of urgency of a Private Notice Question, if the Question list had not been congested for the month ahead by those noble Lords who, no longer being newcomers to this House, and therefore immune from opposition, have abused Question Time by making it a platform for their private obsesssions, in my view, habitually and repetitiously?
Lord Elton: My Lords, I share my noble friend's concern with the conventions of this House. Therefore, I have to reply to him that, if he has a question about Questions, that is another question about which he ought to put down a Question.
Viscount St. Davids: My Lords, will the noble Lord reassure my noble friend that if he carries his parliamentary pass in his spectacle case, as I do, and wishes to approach this House at one of these difficult moments, if he waves the pass out of the window of his car he will be let through, as I was?
Lord Elton: My Lords, I imagine that it all depends on whether at the time you wave the pass you are at the front or the back of the queue.
Lord Boyd-Carpenter: My Lords, is my noble friend aware that on the date in question the Mall, Constitution Hill and Marlborough Gate were all closed, in order presumably to assist this essay in political pedestrianism? Is he also aware of the fact that unless, as he has indicated, you were at the front of the queue, you could wave as many bits of paper about as you wanted and it would have no effect? In those circumstances was there not in fact a failure by the commissioner to carry out the sessional orders which are explicit that access to this Palace must be permitted?
Lord Elton: My Lords, under the sessional orders of both Houses, the commissioner is required to facilitate the passage of Members to and from Parliament during the Sittings. The commissioner in turn directs his officers to disperse all assemblies or processions of persons causing or likely to cause disruption or disorder on any Sitting day within a specified area around Parliament. The area is bounded by a long list of streets with which I shall not trouble your Lordships by reading them out, but in effect what the route of the march did was to go round the edge of that area. Had the area been enlarged, as I think my noble friend would have wished it to be, I suspect the result would have been merely to increase the area of congestion within its limits. There is a difficulty here, but I think that it is right that citizens should have the ability to voice their opposition to Government, which is—
Noble Lords: Hear, hear!
Lord Elton: Those supporting noises would have come perhaps from another place had I been sitting in another place when I voiced that sentiment.
Lord Mishcon: My Lords, would the noble Lord the Minister convey to the Metropolitan Police congratulations for all the care that they took with notices in order to give warning of this procession? Can the noble Lord, Lord Boyd-Carpenter, be thanked by this House for advertising the width and strength of the feeling that must have been behind the procession which filled so many parts of London on that day?
Noble Lords: Hear, hear!
Lord Elton: My Lords, I did in fact witness the efficiency with which the police dealt with this event. I am glad to endorse what the noble Lord says. Judging by the noises that followed the resumption by the noble Lord, Lord Mishcon, of his seat, the House wishes to thank my noble friend Lord Boyd-Carpenter.
Lord Boyd-Carpenter: My Lords, while most gratefully acknowledging the thanks of my noble friend and the noble Lord, Lord Mishcon, may I ask whether it is not also possible to infer that if 15,000 people from local government offices could leave their desks without leave during the day without any apparent reduction in the efficiency of local

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government, it would suggest that local government is grossly overstaffed?
Lord Monson: My Lords, would the Minister not agree that if the average person's time is valued at a modest £5 an hour, and if 100,000 people were delayed for up to an hour and a half (which may be an underestimate), the cost to the general public of this demonstration is in the order of £¾ million in lost time alone, to say nothing of the cost of air pollution from exhaust fumes and of petrol wasted by engines ticking over?
Lord Elton: My Lords, there is no doubt that it was a very annoying occasion for a lot of people, but I should not wish to hearten those who participated by suggesting that it was any more annoying than it really was.
Lord Mishcon: My Lords, I intervene, I hope for the very last time, to ask the House to note that, while an estimate has been given of the cost of the procession, the Government unfortunately have been unable to put forward any estimate at all of the cost that is supposed to be saved by this abandonment of local government.
Lord Elton: My Lords, the noble Lord tempts me very sorely to depart from the Order Paper and debate the merits of the measure, but I shall resist the temptation.

Business
Lord Denham: My Lords, it may be for the convenience of your Lorships to know that the Committee stage of the Telecommunications Bill will be adjourned for dinner at approximatley 7 p.m. for approximately three-quarters of an hour. During that adjournment the Report stage of the Town and Country Planning Bill, the Third Reading of the Inshore Fishing (Scotland) Bill and the consideration on Report of the Orkney Islands Council Order Confirmation Bill will be taken.

Kingston upon Hull Bill [H.L.]
The Chairman of Committees (Lord Aberdare): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, that those provisions in the Bill against which no petition has been presented, or if presented has been withdrawn in whole or in part, or which become unopposed by reason of any of the provisions of Standing Order 113, be committed to a Select Committee and that the quorum of the Select Committee be two.—(Lord Aberdare.)
On Question, Motion agreed to.

Telecommunications Bill
3.1 p.m.
The Chancellor of the Duchy of Lancaster (Lord Cockfield): My Lords, I beg to move that the House do once again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Lord Cockfield.)
On Question, Motion agreed to.
House in Committee accordingly.
[THE LORD ABERDARE in the Chair.]
Lord Bruce of Donington Lord Bruce of Donington moved Amendment No. 62:
After Clause 4, insert the following new clause:
("Telecommunications Council.
.—(1) The Secretary of State shall appoint a Council known as the Telecommunications Council (in this Act referred to as "the Council").
(2) The Director shall refer to the Council for decision in any matters in which disputes have arisen or appear likely to arise relating to the administration and performance of the functions assigned or transferred to him under this Act.
(3) In addition to the Director, who shall he the Chairman of the Council, the Council shall consist of not more than six persons of which two shall be members of Trade Unions recognised as closely associated with the telecommunications industry.
(4) The appointment of a person to the Council shall be for a term not exceeding four years.
(5) In relation to any matter which is referred to the Council, the Council shall consider whether any licence or agreement concerning any United Kingdom consumer or United Kingdom operator or foreign user or associations of such consumers, operators or users may effect the prevention, restriction or distortion of competition between United Kingdom operators in the United Kingdom or in markets outside the United Kingdom.").
The noble Lord said: Your Lordships' Committee will recall that an earlier amendment which was introduced by the noble Lord, Lord Lloyd of Kilgerran, sought to establish a council or an authority which would have the responsibility of appointing the Director General of Telecommunications. The debate went very wide, and ultimately the Committee rejected the amendment.
The amendment now before the Committee seeks to do something a little different. It seeks to create a council, within the terms that are set out in detail in the amendment itself and upon which I shall not elaborate, which shall be appointed by the Secretary of State himself. The council's main purpose will be to resolve disputes between licensed telecommunications operators and the director of Oftel. If the machinery were established, disputes referred to the council would be settled openly and in an accountable way. As I say, that is the main purpose.
From lengthy discussion of earlier clauses of the Bill it became quite clear that an enormous responsibility will rest upon the director himself. The very length of the debates on the individual duties and guidelines to be laid down for the director, in particular under Clause 3 of the Bill, made it quite clear that the responsibility will be a very onerous one for him to discharge alone. Therefore, the amendment seeks to establish other functions for the council. First, the proposed council would be a body with which the director himself could discuss matters of any kind of dubiety; and if we go through all the clauses of and

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schedules to the Bill, it must I think be generally conceded that there are quite a number of grey areas. At the same time the council would provide a valuable forum in which those within the industry and those affected by it could discuss recent developments in the telecommunications field. In this respect the council could take over from the rather ad hoc Department of Trade and Industry consultative committee on telecommunications a number of the functions that it has performed.
The council would also be an ideal organisation to co-ordinate the activities of the advisory bodies that are to be set up under Clause 52(2) of the Bill. So in this respect the council itself, which it is to be hoped would be widely representative, would absorb some of the activities of the Post Office Users' National Council, which, as the Committee knows, under Clause 51(4) it is proposed to abolish.
Bearing in mind the whole nature of this public utility—a public monopoly that is in effect to become a private monopoly—I should have thought that there is an overwhelming case for the appointment of a council of this kind. At present the Secretary of State is not an entirely uncontroversial person. He has many decided views on the future of most matters with which he comes into contact. I consider that it would not be wise for there to be nothing in between the Secretary of State and the director. There ought to be a body that can provide some degree of balance and possibly on occasions give reassurance to the director of Oftel himself.
I do not propose to enlarge on this matter very much further because I believe that the advantages of such a body are self-evident. In their way the Government can, if they wish, exert their power and reject the amendment, preferring matters to remain firmly in the hands of the Secretary of State because they cannot brook anything which approaches a body of the type of, say, the Independent Broadcasting Authority, and cannot brook any interference with whatever instructions are passed on by the Secretary of State to the director.
I believe that, during the next few years, resolving the lobby pressures of the various interests involved (whose influence has not been wholly absent from some of the amendments that have been proposed and some of the arguments that have been preferred) will possibly take up a good deal of the director general's time. It would I think be reassuring for the public at large, as well as in the interests of good, ordinary administration within a democracy, that that should occur. Government by democracy is very often defined as government by discussion, and indeed that it ought to be. There ought to be the widest possible ventilation of the differences that arise from time to time and of the injustices or unfairness that are alleged to be committed by one side against another, and I cannot help but feel that this very moderate amendment is worthy of the general support of your Lordships' Committee. I beg to move.
Lord Lloyd of Kilgerran: I strongly recommend this amendment to the committee. The creation of a consultative body of this kind would protect—I
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emphasise this—Oftel's impartiality and credibility. There is a second minor but personal reason why I recommend and support the amendment. The noble Lord, Lord Bruce of Donington, has phrased the amendment in exactly the same words that I used in an amendment that I put down to the 1983 Telecommunications Bill. That ran very well. I hope that this amendment also runs very well in the Committee today. This kind of council would surely be helpful as a watch dog. In fulfilling that role, it would surely increase the confidence of public operators and potential foreign investors who will be affected by the decisions of the director. As he would be the chairman of the proposed council, his standing and status would be unaffected.
The director has a tremendously difficult task. He has to deal with complicated procedures as well as fundamental questions of policy. A council of this kind to which he could refer would surely be of some help. In most amendments, and indeed in any matters, the sting is usually in the tail. I should like to draw the attention of the Committee to the fifth part of the amendment. It is similar to an earlier amendment that I moved for the purpose, as I thought, of helping the Government to make clear their policy in regard to competition, particularly as it affects other countries. I do not know whether it is known to the Government but it is known to me informally that a number of foreign companies and institutions are following the debate in the House for a variety of reasons to see what is the actual policy of the Government in regard to competition.
It would therefore be helpful if the Government were to include some general words somewhere in the Bill—I think that this amendment would be most appropriate—to say that they are not taking actions that are deliberately intended to infringe, say, the United States anti-trust laws or the EC competition laws under Articles 85 and 86 of the Rome Treaty. When I raised this matter earlier in Committee on another amendment, the noble Lord, Lord Glenarthur, was good enough to say, in replying to the words that the noble Lord, Lord Bruce of Donington, has included in subsection (5) of this amendment, namely, that the action of British Telecom, when it is privatised, should not distort competition or prevent competition to this wide extent:
"Therefore, while I appreciate the noble Lord's concern, I can assure him that the Government are doing a great deal both to introduce more competition and to take steps under the Bill, and under existing competition legislation, to ensure that there is fair competition in the telecommunications market. Clearly the Secretary of State and the director would note the effect on other countries of the market and competition generally". [Official Report, 16/2/84: cols. 358–359.]
I should therefore like to ask whether the Government can be more explicit as to the steps that they are taking to introduce under this Bill and under existing competition legislation matters to ensure that there is fair competition, particularly abroad. Your Lordships will know that when it comes to litigation in this country on the interpretation of an Act of Parliament, it is not appropriate to cite Hansard in order to understand the kind of argument that may or may not have affected the Government. But, when it comes to foreign territories, Hansard will be widely examined and possibly widely quoted. My purpose

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therefore in strongly supporting the amendment, particularly the last part of it, is to provide an opportunity for the Government to give some clearer view as to the width of competition, particularly in the export trade.
3.15 p.m.
Lord Taylor of Gryfe: The Committee will recall that the first amendment to this Bill some days ago was one proposed by the noble Lord, Lord Lloyd of Kilgerran, suggesting that an authority be set up to perform some of the functions outlined in the proposals before us today to set up a council. That amendment was defeated by four votes. It contained certain proposals that Members of the Committee may have found difficult to support. One proposal was that the new authority would appoint the chairman of Oftel. It was a proposal about which I had some doubts myself. In the amendment now proposed, your Lordships will see that there is a different relationship between the council suggested by the noble Lord. Lord Bruce of Donington, and the proposal of the noble Lord, Lord Lloyd of Kilgerran, that was so narrowly defeated. In this case, there would be a perfect liaison between the chairman of Oftel and the new body since he would be the chairman of the council.
I should like to say from these Benches that amendments proposed to the Bill are not designed to frustrate or impede the new organisation in discharging its responsibilities. We argued on Second Reading that this is a bad and unnecessary Bill. We still believe that to be true. However, since the principle is approved, it is not our intention to frustrate or impede. The amendment now being discussed is not designed to make life difficult for the new board of BT. It is designed to help the new board and to help the smooth operation of these proposals.
First, the suggestion is that there should be two trade unionists on the council. In the debates last week, great anxieties were expressed on the part of trade unionists with regard to the future operation of British Telecom. I believe that the presence of two trade unionists on the council would help the whole industrial relations picture of the new organisation. It is not an unusual suggestion. The involvement of employees in consultative bodies in industry is fairly well accepted in modern and progressive industrial organisations. We are therefore suggesting that there should be two trade unionists.
When you read the clauses it is clearly a complex Bill. On top of that, there are 44 separate clauses in the licence itself governing the operations of this business. Here you have a very complex organisation responsible for a service that enters the homes of millions of people in this country. Yet that important economic and social responsibility is discharged by a very cosy arrangement between the Secretary of State and the chairman of BT.
Those members of the public who are getting this service want to feel that there is some body which is responsible. On the last occasion I quoted the example—which appealed to the noble Baroness, Lady Macleod of Borve—of the experience of the IBA. That is another service that enters the homes of millions of people, just like the telephone service. But
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the people who enjoy the services of independent television feel that there is somebody that keeps an eye on whether the conditions of the licence and the responsibility assumed by the television companies are fully and adequately discharged.
I suggest that the telephone is no less important to the consumers, and that the council would add to the credibility of the organisation. After all, it is a new organisation. People have been accustomed to the Post Office, as such, for their telephone services. This is a new organisation and it would add to its credibility and acceptability if there was some body of this kind rather than some remote civil servant or a Minister a long way away. If there were a group of people, in which trade unionists and other people were represented, to help to air the difficulties and to consult as regards the application of a very complex business that affects millions of people, it would add to its credibility and acceptability. For that reason, we very much support the amendment and hope that the Government will find it acceptable.
Lord Morris: Despite the fact that I found the advocacy of the noble Lord. Lord Lloyd of Kilgerran, positively seductive, this amendment, if it becomes a law, would cause a number of problems. It would, among other things, create yet another tier of Government in the planning and administration of the telecommunications future of this country. The noble Lord, Lord Lloyd, argued by way of analogy that the council would act as a type of watchdog. One of the problems with watchdogs of course is that they take a lot of kennelling and a lot of feeding, and that again would create a considerable amount of expense.
Indeed, the noble Lord, Lord Lloyd, reiterated the vitally important fact that the role of the director general will be an extremely difficult one. The noble Lord referred to the director general's task as being a terribly difficult task. I believe that this amendment would make his task even more difficult. In addition to that, the provisions of Clauses 27 and 52 give the director general the powers to seek whatever advice and assistance he will need—and he will undoubtedly need it—to do his job in an effective way. To impose this amendment upon the Secretary of State will make life more difficult rather than easier in the future.
Lord Ezra: I should like to say in answer to the points just raised by the noble Lord, Lord Morris, that we are here talking not about a tier of Government or a tier of an executive nature; but about a regulatory body. If this regulatory body is to have the credibility which I believe will be very necessary in this major change in the running of a big organisation like the telecommunications industry, then it must be seen to be credible. One of the weaknesses in the organisation of this regulatory body is that so much is concentrated in one man—everything centres on the director. If there were a council of the sort so ably recommended by the noble Lord, Lord Bruce of Donington, I cannot personally see how it would do otherwise than strengthen the nature of this body.
We are aiming here to ensure that we shall continue to have—as we have had in the past—an effective service from the telecommunications industry of this country. It has hitherto been a public corporation and

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any complaints of individuals or of organisations have been channelled through the public system. It is now moving into the private system; but it will retain its existing size with a very limited measure of competition—at any rate in the initial years. We must be convinced not only in this Committee but in the country that the regulatory system will be an effective one. I believe that it could be very strongly reinforced by the council which has been recommended.
Lord Shaughnessy: With some misgivings about the specifics of the amendment proposed by the noble Lord. Lord Lloyd of Kilgerran, I think that the intention of the proposal to establish a council would have two beneficial results. One of the problems that the director general of Oftel is bound to encounter is that he will be so involved in administrative and monitoring duties that he will not be accessible by the public—and by that I mean the consumer, the subscriber or the supplier to British Telecom or any other company operating where complaints can be brought forward. Therefore, a mechanism such as the council proposed in this amendment would provide that access and be a support to the director general in dealing with the mass of administrative and consultative problems that will inevitably be brought before him.
Lord Fraser of Kilmorack: I had no intention of intervening. However, the word "watchdog" brought me to my feet because every time I hear the word "watchdog" I feel the same as I do in economic debates when people say, "There is light at the end of the tunnel". Although I would be the first to admit that there have been some notable and good exceptions to the rule, in my experience when the word "watchdog" is applied to committees, councils and other bodies of that kind, they have usually either been asleep on the job or biting the hand that fed them. One way and another I do not think that this is quite the right answer. There may he a need for something, but I would not support the amendment.
3.28 p.m.
Lord Cockfield: I am in some difficulty in dealing with the arguments that have been advanced in favour of this amendment because the noble Lord, Lord Bruce of Donington, went to great lengths to explain that his amendment was different from Amendment No. 1 which had been moved by the noble Lord, Lord Lloyd of Kilgerran, and which was rejected by your Lordships last week. But the noble Lord, Lord Lloyd of Kilgerran, went to great lengths to explain that the amendment of the noble Lord, Lord Bruce of Donington, was precisely the same as the one that he himself had moved.
Lord Lloyd of Kilgerran: Will the noble Lord the Minister allow me to intervene?
Lord Cockfield: Yes, of course.
Lord Lloyd of Kilgerran: The noble Lord the Minister has a complete misunderstanding of this situation—as he has, if I may say so, of many others. The amendment to which this is identical was the one
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that I moved in the 1983 Telecommunications Bill. I then moved in this Bill—in fact, I batted first—another quite different amendment. So the noble Lord the Minister is wrong in referring to the fact that the amendment moved by the noble Lord, Lord Bruce of Donington, is the same as the amendment that I moved in this Bill.
Lord Cockfield: In substance the two amendments are the same. They endeavour to set up a council or a body above the director general to whom the director general stands in some sort of relationship—let me put it like that—and the arguments for or against the creation of a body of that nature are very much the same in both instances. There are differences in the detail of the two proposals, but so far as the substance of the two proposals is concerned, it is essentially the same. In fact, the drafting of subsection (5) of the proposed new clause of the noble Lord, Lord Bruce, is almost identical to that of Amendment No. 33, which was moved by the noble Lord, Lord Lloyd of Kilgerran. Let me put it like this. There is, therefore, a degree of similarity between the two. I was making my point, not as a controversial one—I do not know why both noble Lords are so sensitive about the parentage of their amendments—
Lord Bruce of Donington: We are not sensitive at all.
Lord Cockfield: The noble Lord supports me in his interruption. I was merely drawing attention to what I thought was a fairly obvious point, that both amendments were intended to cover much the same ground. With that restatement, and not wishing in any way to drive a wedge between the noble Lord, Lord Lloyd of Kilgerran, and the noble Lord, Lord Bruce of Donington, perhaps we might agree that both amendments were designed to set up a new body which would stand in a position of adviser, assistant or helper to the director general.
The first point of substance that I wish to make is as follows. The noble Lord, Lord Bruce of Donington, said that it was the Government's policy that matters should remain firmly in the hands of the Secretary of State. That is not the basis on which the Bill is constructed; in fact, the contrary is true: that the director general is put in as an independent person and most of the powers are vested in him. He is not answerable for his decisions to the Secretary of State. Therefore, from that point of view the argument that what one is doing is protecting the director general from the Secretary of State is not in any sense a valid argument.
The basis on which the regulatory system has been constructed is that in Clause 3 and elsewhere—for example, in Clause 7—the Bill sets out very clearly what are the duties which bind the director general in the performance of his functions. If the director general fails to carry out his duties, he can be challenged in the courts. Indeed, one of the reasons why the Bill specifies matters in detail instead of conferring general and ill-defined powers is to ensure that the director cannot act arbitrarily. It would, of course, be quite exceptional for anyone to challenge the director in the courts, but the fact that he can be so challenged is a very effective sanction and, if I may say

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so, a more effective sanction than the appointment of a council which is given powers to consider disputes but no power to do anything about them.
There are other provisions of the Bill which are relevant to the present discussion. Thus the Monopolies and Mergers Commission will deal with disputes as to whether or not a licence should be amended, and the advisory bodies to be established under Clause 52 of the Bill will help and advise the director, particularly in relation to disputes between British Telecom and consumers.
Perhaps I may now turn to the detail of the proposed new clause. One of the criticisms of the telcommunications authority—that is, the body to which Amendment No. 1 related—was that the amendment gave the authority no guidance as to how it was to consider disputes referred to it. In the case of the council proposed by the present new clause, it is given guidance in subsection (5) of the clause, but subsection (5) relates only to the promotion of competition. This is obviously important but, as your Lordships will appreciate from our discussions on Clause 3, there are other factors to be considered when determining telecommunications policy, and it would be wrong to ignore them. For example, there is the universal service, the 999 service, services to rural areas and so on, and nowhere are these mentioned in the proposed new clause.
If the noble Lord, Lord Lloyd of Kilgerran, would forgive me, I wonder whether at this stage I might divert to deal with a specific and very technical point that he raised on subsection (5) of the proposed new clause. The Bill itself lays down very clearly indeed in Clause 3(2)(b) that one of the duties of the director is:
"to maintain and promote effective competition".
Then later on, in paragraph (h) of the same subsection to the same clause, another duty is:
"to maintain and promote outside the United Kingdom competitive acivity",
and so on. One of the main purposes of the Bill is to promote competition. I entirely understand the specific point which the noble Lord, Lord Lloyd of Kilgerran, has in mind—namely, the question of conflict of laws and extra-territoriality—and that is why I describe this as being a highly technical area.
As he knows, the position here is that we do not accept that other people are entitled to interfere in the domestic affairs of the United Kingdom. Nevertheless, conflicts do arise and have arisen because the laws of one country differ from those of another. While the director general would obviously pay regard, and would need to pay regard, primarily to the law of the United Kingdom, the question of the impact of foreign law is something that he would need to have in his mind. Indeed, later in the Bill at Clause 47(1) there are provisions which state:
"It shall be the duty of the Director, so far as it apppears to him practicable from time to time, to keep under review the carrying on both within and outside the United Kingdom of activities connected with telecommunications".
The object of that clause is to ensure that the director general recognises that one of his functions is to know what is going on overseas. Therefore, the answer on this technical point is that we are fully aware of the implications of extra-territoriality. The purpose of the
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Bill is to promote competition, and that is stated in a number of places in the Bill.
Having said that, perhaps I might now return more generally to the proposed new clause. There are further defects in the clause, in addition to those to which I have referred. If the council is to act, in effect, as an appeal body, sitting in judgment on the performance or administration of the director's functions, it would be quite wrong for him to he chairman. This would make him judge and jury as well as defendant.
Secondly, the amendment enables the director to refer disputes to the council for decision, but an aggrieved party has no such power. The clause as drafted, therefore, fails to meet the objectives which have been put forward in the debate which has taken place in your Lordships' Committee.
Having said that, I appreciate the general feeling which exists on all sides of the Committee, a feeling expressed both today and in the debate on the amendment moved last Monday by the noble Lord, Lord Lloyd of Kilgerran, that a body should be appointed by the Secretary of State which should in effect be as guide, philosopher and friend—if I may use the words of Pope—to the director general. I would suggest that the right course is to build on Clause 52 and get that right rather than introduce a new concept into the Bill.
If it is acceptable to the Committee, I propose two things. First, that the advisory bodies should be appointed not by the director but by the Secretary of State. This would give them greater status. It would emphasise their independence from the director, and this was a point on which I understood the noble Lord, Lord Bruce of Donington, to place great weight. It emphasised their independence from the director, and underlined the fact that they are there to help and advise the director from an independent standpoint.
Secondly, I would propose that the terms of reference of the advisory bodies should be amended—or perhaps a better term would be extended—to underline the fact that the advisory bodies will be concerned with the interests of consumers as well as of users generally. There are amendments relating to Clause 52 on the Marshalled List and what I am saying to some extent anticipates those amendments; but I felt that your Lordships would like to know the full extent of the proposals of the Government at this stage in our proceedings.
I believe that the suggestions I have made fully meet the point of substance in the amendment of the noble Lord, Lord Bruce, and also the point of substance in the original amendment, Amendment No. 1, of the noble Lord, Lord Lloyd of Kilgerran. It is a real attempt on the part of the Government to meet what we feel are genuine arguments, even though we believe they could be met perhaps in a more elegant and effective way than do these particular amendments. I very much hope that on the basis of the offer I have made, the noble Lord, Lord Bruce, would feel it possible to withdraw his amendment.
Lord Bruce of Donington: I am most grateful to the noble Lord, Lord Cockfield, for the very substantial concession he has offered the Committee in relation to this particular aspect of the matter. It rather seems to

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me that after having made a very gallant effort to shoot down the arguments put forward by the noble Lord, Lord Lloyd of Kilgerran, and myself, he then proceeded to support them and admit their validity by the very extent of the concession that he had granted. This does not in any way diminish our appreciation that the noble Lord should see fit to take account of what he must know is a very widespread feeling in the Committee, and possibly also in the country. We shall of course take a very close look indeed at the proposals when they materialise at a later stage in the Bill to see whether they meet substantially the points made by this amendment, including one specific point which is referred to in the amendment itself and to which the noble Lord. Lord Taylor of Gryffe, addressed himself, about the desirability of trade union representation at some point or other.
Subject to that, and in the hope that the noble Lord will be able to produce—and will in fact produce—something that is generally acceptable on the lines of the amendment at present before your Lordships, I ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 5 agreed to.
Clause 6—[Exceptions to section 5]:
3.45 p.m.
Lord Mottistone Lord Mottistone moved Amendment No. 63:
Page 7, line 14, leave out from ("system") to end of line 16.
The noble Lord said: My noble friend Lord Orr-Ewing has asked me to move this amendment on his behalf. Clause 6 of this Bill repeats a lot of the trends in Clause 13 of the 1981 Act and in effect places various sorts of limitations. Basically, the liberalisation of telecommunications as a whole, which we see as being the main point of the Bill, is seriously undermined without the right to use apparatus or to rent its transmission capacity without restriction. We see these paragraphs in subsection (4) to be such restrictions. Accordingly, we believe that the principles of the Bill would be better realised if the paragraphs were struck from it. I beg to move the amendment.
The Countess of Mar: I wish to speak very strongly against this amendment, because if these provisions were struck out of the Bill it would provide what is called a "by-passer's charter". People could have unlicensed point-to-point circuits, which means a company in Glasgow could have a circuit operating from its head office in Glasgow to somewhere in London. Someone could make a local call in Glasgow, be connected to the London Office and then be reconnected into the network. British Telecommunications at present relies for one-third of its revenue from 300 big customers which are likely to have point-to-point circuits. It would be disastrous for the revenue base of British Telecommunications if this was carried through; and not only disastrous for them, but also for all the other customers in the country.
The Lord Advocate (Lord Mackay of Clashfern): This amendment is intended to introduce wider
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freedom from licensing into telecommunications, to release from licensing controls those businesses which run their own telecommunications system, and to give them freedom to provide telecommunications service to others. My noble friend has referred to the desirability of businesses being free to resell capacity on the circuits they lease. The Government share many of the noble Lord's objectives. We want a liberalised telecommunications market. We want businesses to be as free as possible to run their own systems and to provide services to others. We are moving quickly—some might suggest too quickly—towards that end. We intend to make a statement to the House at a later stage of the Bill outlining the steps that we propose to take to permit wider resale of circuits leased from BT.
The Government cannot however accept the approach that my noble friend is suggesting in his amendments, since they would undermine the foundations of the Government's telecommunications policy. The basic result of the amendment is to produce an exemption so that any system can be run by a business without a licence if it is run for the purpose of the business and if it is not connected with another system. These two simple tests could largely be met by a company which set up a complete national network in competition with BT and Mercury. It would be in the business of providing services to others so it would meet the first test, and provided it was not connected to the BT or Mercury systems it would meet the second test. There would therefore be almost free market entry for those wanting to supply telecommunication services, and the Government's policy in relation to Mercury would be destroyed.
The amendments would also destroy our prospects of moving towards arrangements where BT was compelled to permit the resale of private leased circuits. At present a large number of British Telecom's leased circuits fall within the first two tests that I have described; they and the apparatus at each end are run by BT for the purpose of its business and they are not connected to another system. So the leased circuits would, if my noble friend's amendment is accepted, be exempted from licensing.
If they were exempted, the Secretary of State would not have the power to impose licence conditions on the running of such circuits, for example, to require British Telecom to connect such lines to other systems and to permit other persons to resell capacity over the leased circuits. It is only Clause 6(4), which my noble friend wishes deleted, which subjects the provision of telecommunication services to licensing controls and thereby ensures that British Telecom's private leased circuits are subject to licensing controls. I hope, therefore, that the noble Lord will feel that, while we share his objectives, the method that he has adopted for seeking to promote them is not appropriate, and that he will be able to withdraw the amendment.
Lord McIntosh of Haringey: The noble and learned Lord has made it clear that the amendment is technically defective and would not meet the requirements of the movers, but in doing so he has made what at first sight seems to be an alarming concession, or has anticipated an alarming concession. He said, if I understood him rightly, that at a later stage in the Bill

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he is going to make a statement about the resale of leased circuits. That presumably presages some sort of liberalisation of the resale of leased circuits, some sort of release from licensing. It is going to affect not only amendments of this sort but also the whole question of access charges, the whole question of the profitability of British Telecommunications, and indeed it is going to affect the purchase price for British Telecom on flotation.
If the noble and learned Lord is to make an important statement in the future he ought to make it as soon as possible because it is going to affect a large number of parts of the Bill, and those who are considering the Bill now ought to be able to see what it is that the Government are proposing. As the position stands it looks as though it could be a severe threat to the profitability and independence and even the viability of British Telecom, and I would urge the Government to make the statement they are anticipating as soon as possible.
Lord Somers: I must confess to being an ignoramus about such things, but take for instance the circuit within your Lordships' House, within the Houses of Parliament. Presumably that is a private circuit, but with one important exception and that is that by keying nine you can connect yourself to the main circuit outside. It would lose a great deal of its usefulness if one could not do that. Surely the element of competition would also be reduced a great deal.
Lord Boyd-Carpenter: I found myself, rather embarrassingly, in a measure of agreement with the noble Lord, Lord McIntosh of Haringey. I was interested in what my noble and learned friend said about an important statement being made. I should like to press him a little as to when we are to have the advantage of hearing this. It is a little unsatisfactory to discuss amendment after amendment of a detailed character to a Bill of this character when it may well be that the statement which my noble and learned friend is going to make would make a good deal of that discussion unnecessary.
If, as I hope, the statement is going to indicate a greater degree of liberalisation than is to be deduced from the Bill itself as it stands, I should have thought that that would undoubtedly cause some of my noble friends not to feel it necessary to move some of their amendments further on in the Marshalled List. However that may be, I am sure that my noble and learned friend will agree that it is difficult to go on discussing in detail a Bill when it may be that that Bill is in some respects going to be quite substantially altered as a result of a statement.
I hope that my noble and learned friend will be able to be a little more precise. Will this statement be made during the Committee stage? Is it anticipated holding it up until Report? Is he indeed going to hold it up till Third Reading? My noble and learned friend is normally so helpful. Perhaps he would show his helpfulness by being a trifle more precise.
Lord Mackay of Clashfern: First, I should say that, as I have sought to explain, the provisions of the Bill relating to licensing which are affected by this
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amendment would not, as I have suggested, be removed from the Bill. What I am suggesting is that, as soon as we are in a position to make it, a statement will be made which I would anticipate at a later stage in the Bill—that is to say, not on Committee stage, at Report or Third Reading—upon the way in which this policy will apply. The need for the licensing appears to us, on the basis of these amendments, to be required, and I certainly undertake that we shall make the statement as soon as we are in a position to do so.
Lord Alport: May I follow my noble friend Lord Boyd-Carpenter by saying that I find it extraordinary that we should be going through day after day of telecommunications Committee stage under the threat that a statement on the way in which it is going to be carried out is going to be made at Third Reading. Surely if there is an explanation of the Government's policy in relation to this, it should be made as early as possible in the Committee stage so that we know exactly where we are.
Lord Bruce of Donington: Your Lordships will be aware that this Bill was under considerable discussion in another place, and so far it has gone through Second Reading and part of its Committee stage here. The Committee well knows that the amendments so far made, or proposed, in Committee by the Government and their supporters vastly exceed those put up by Her Majesty's Opposition and by the Liberal and Social Democratic Parties in this House.
This Bill seems to be under a state of perpetual amendment by the Government themselves and their supporters. We do not object to that when it comes to constructive amendments, to amendments which take account of the views of the Committee, or amendments required for drafting or correcting purposes, or which express the intentions of the Bill more accurately. All these are permissible and indeed it is part of the functions of this House to consider them. But here we are considering something that was not in anticipation when the Bill entered the Committee stage.
It seems unreasonable that the Government now say that they are going to make a statement of importance at some later stage of the Bill which may well have a considerable influence on the amendments still to be considered by your Lordships and might, if it had been made before, have had a significant effect on the Committee's attitude towards amendments which have already been discussed in this Committee. This is not satisfactory. I must, on behalf of Her Majesty's Opposition, protest strongly against this kind of treatment of the Committee.
Earl De La Warr: I wonder whether my noble and learned friend can help us? I hope he will be able to tell me that I was wrong, but it seemed to me that the statement he made about what is to come later was used to some extent in rebuttal of my noble friend's amendment. If it was, then that is serious because he has used an unknown as an argument. Perhaps he could help the Committee to the advantage of us all by telling me that that was not so, and that nor will he be using the fact of his coming statement in rebuttal of any further amendments.
Lord McIntosh of Haringey: Before the noble and learned Lord replies, may I particularly draw his attention to the words he used about a statement being made on Report or Third Reading. If a statement is made at the time of Third Reading that leaves no opportunity whatsoever for the House to consider what consequential amendments may be required from the Government's own amendments. That surely would be a serious abuse of the purpose of this House as a revising Chamber. If amendments come from the Government at such a time that the House does not have a chance to consider them, or to consider what to do about them, or what its attitude should be to them, what are we revising?
Lord Mackay of Clashfern: I am sure it must be my fault that your Lordships may have a somewhat different impression of what I am seeking to say from what I intend. What I seek to do is to maintain the position that licensing should be required to cover the areas covered by this amendment. My noble friend has indicated that he would like to see the area covered by this amendment liberalised. What I say is that to achieve that to any extent it is proper that this area should continue to be covered by licensing. That is my answer to the amendment. What I said is that we shall take account of what my noble friend is saying in considering what we can say in amplification of the policy which will determine how these licence powers shall be used in relation to the area with which he is concerned.
This is not a question of amending the Bill or anything of that kind. It is an endeavour to amplify and to respond more fully that I can today to what my noble friend has put forward. All I am seeking to anticipate is a somewhat more detailed statement than has yet been made upon the way in which the Government see this power in its application being developed. In my submission there is nothing improper about that. It is a continuing consideration of these matters, taking into account what we hear from all sides. We shall make a statement about this as soon as we are in a position to do so. It is not in the nature of a statement which would propose amendments or bring amendments from the Government. It is in the nature of explaining how we propose, in a little more detail than we have been able to say so far, what the policy will be in relation to this matter.
Lord Bruce of Donington: The noble and learned Lord cannot have it both ways. Either the matter is, as the noble Lord stated, of some significance—and this was the way the noble and learned Lord conveyed it to the Committee; "an important statement"—or it is not important. If it is important it does not defy either the great departments of state or their parliamentary counsel to be able to incorporate the appropriate qualifications and clarity into the Bill. The noble and learned Lord only has himself to blame, or his department, if the Bill is so ambiguous or it leaves so much grey area that it has to be clarified at a later stage by an important statement. This is not a very courteous way to treat your Lordships' Committee.
Lord Ezra: Is the noble and learned Lord indicating that this future statement will deal with the whole issue
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of licensing? In that event, would it not make our work on a number of amendments now coming up on the subject of licensing somewhat unproductive?
Lord Mackay of Clashfern: What I indicated was that we would hope to amplify what has already been said in relation to the policy that will apply to the use of circuits leased from British Telecom. It is only the use of leased circuits that is in question. What we hope to be able to do is to be a little more detailed than has yet been possible in relation to the policy that will apply in exercising the powers which the Bill gives us in this connection.
That is a perfectly reasonable response to the amendment which my noble friend has put forward; saying that we are considering how far in the nature of things the policy which we adopt in this matter will meet his requirements.
Lord McIntosh of Haringey: I am afraid that this matter is going from bad to worse. As I understand from the noble and learned Lord's most recent words, this proposed statement is intended to affect his noble friend. It is seeking to get Lord Mottistone to withdraw the amendment. In other words it is seeking to change the course of the Committee procedures on the Bill. We are now told that the statement to be made is not itself to be incorporated into the Bill. That makes me wonder whether the Government really understand the financial importance of the resale of leased circuits. The basis on which leased circuits can be resold is absolutely critical to the financial viability of British Telecom. If British Telecom is to be forced to sell circuits in bulk and to allow other people to cream off the profits by selling them at a higher price broken up, the whole basis on which the prospectus is to be made to the public at the time of flotation is changed. I suggest to the noble and learned Lord and to the Government that the problem that the Government have about flotation will be immeasurably worse if any real change is proposed in this statement.
As my noble friend Lord Bruce of Donington said, in his characteristically moderate way, either this is an important statement, in which case it should be made now and it certainly ought to be made before Third Reading, or it is of no significance, in which case the noble Lord, Lord Mottistone, ought to ignore it.
The Countess of Mar: I find myself increasingly amazed as we go on through this Bill, particulary at the financing of the new set-up which is airy-fairy. Would it not have been better for the Government to have put their policies on a solid basis before they presented the Bill to the House?
Lord Mottistone: Perhaps I should now come in. My thoughts when I heard my noble and learned friend were that I welcomed his support for the general approach of encouraging liberalisation and on the whole I thought what he had to say was encouraging. I was going to say to him that I would read with great care what he had to say. The statement is of interest to us all, whatever view we may take about the Bill and whatever effect it may have. Though I shall withdraw the amendment, I think the Government must take note of the fact that we require to have this policy

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statement as soon as is practicable. It could, as the noble Lord, Lord Ezra, said, affect the amendments we are about to come to about the licence, and I suspect that the policy will be deeply related to the licence. One of the things that we shall all be saying when we come to debate the licence is that we want to see the final licence good and early and the policy which goes with it. But, having said that, I beg leave to withdraw Amendment No. 63.
Lord Bruce of Donington: The noble Lord, Lord Cockfield, must have heard the exchanges across the Committee on this matter over the last 20 minutes. In view of the fact that there is a possibility that the attitude taken by his noble and learned friend to the amendment moved by the noble Lord, Lord Mottistone, may affect other amendments that are down in the name of the noble Lord, may I ask the noble Lord, Lord Cockfield, whether he would consider the advisability of asking the Committee to adjourn for an hour while the Government make up their mind about what they propose to do with the Bill? They are evidently in some confusion. I think the noble Lord owes it to the Committee to say, after due consideration with his officials and colleagues, how they propose to proceed. I suggest that he considers asking for the adjournment of the Committee for an hour and then comes back to make the statement, so that noble Lords on all sides of the Committee know exactly how we shall proceed hereafter.
Lord Boyd-Carpenter: I put to my noble friend Lord Cockfield a suggestion rather less drastic than that of the noble Lord, Lord Bruce of Donington, despite the habitual moderation which his noble friend rather startlingly attributed to him. I feel that it would not be treating the Committee fairly or properly to defer this statement—which was obviously referred to here by the noble and learned Lord the Lord Advocate as having some relevance to the amendment we are discussing—to Third Reading. Will my noble friends seriously consider before we go over this course again on Report—no doubt the Report stage, judging from experience at the Committee stage, will not be unduly brief—getting the statement here either before or at the beginning of the Report stage? Otherwise, I am bound to say that the position of your Lordships' House as a revising Chamber has not been properly respected.
Lord Mackay of Clashfern: The situation certainly is that we shall give the further detail as soon as we are able to do so. I should certainly hope that we shall be in a position to do that in time for the Report stage. The situation is that further detail has been under consideration for some time, and that what we are intending by the statement to which I have referred is simply to fill in some further details on the aspects of licensing of private systems. I certainly undertake —and I am grateful to my noble friend Lord Boyd-Carpenter for his intervention—that we shall do it at the earliest possible moment, and I hope that we shall be in a position to do it for the Report stage.
So far as concerns the conundrum of classifying statements as of relative importance, the situation is that what I am saying is that we hope to be in a
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position here—as on many other matters that are from time to time considered—where the thinking will develop between one stage and another. As far as this particular matter is concerned, what I indicated was that we hope to be in a position to give further details on the policy raised by this amendment, and I hope that we shall be in a position to do so by the Report stage of the Bill.
Lord Ezra: May I ask the noble and learned Lord whether the proposed statement is likely to refer to other amendments which we have already discussed, or might be likely to discuss, or is it solely related to the amendment that we have just been discussing?
Lord Mackay of Clashfern: The matter that I have in mind is that of giving further details in relation to the policy that we expect to be pursued in relation to the use of leased circuits. It does not directly affect the terms of any of these amendments. All it does is to indicate, in a little more detail than we have yet been able to state it in relation to that particular matter, the policy that would be pursued.
Lord Bruce of Donington: This Bill has been in gestation for well over a year. There has been plenty of opportunity to consider these matters. If the noble and learned Lord's Government had made up their minds what they were going to do, the statement could be made now. I still think that the needs of your Lordships should be considered. I beg to move that the House do now resume.
Moved, That the House do now resume.—(Lord Bruce of Donington.)
4.13 p.m.
On Question, Whether the Motion shall be agreed to?
Their Lordships divided: Contents, 93; Not-Contents. 109.

DIVISION NO. 1

CONTENTS

Ailesbury, M

Delacourt-Smith of Alteryn, B

Airedale, L

Amherst, E

Denington, B.

Ampthill, L

Diamond, L

Ardwick, L

Donaldson of Kingsbridge, L

Attlee, E

Donnet of Balgay, L

Aylestone, L

Elwyn-Jones, L

Banks, L

Ennals, L

Beswick, L

Ewart-Biggs, B

Birk, B

Ezra, L

Bishopston, L

Fisher of Rednal, B

Blyton, L

Gaitskell, B

Boston of Faversham, L

Gallacher, L

Bottomley, L

George-Brown, L

Briginshaw, L

Graham of Edmonton, L. [Teller.]

Brockway, L

Brooks of Tremorfa, L

Grimond, L

Bruce of Donington, L

Hampton, L

Burton of Coventry, B

Hanworth, V

Caradon, L

Henderson of Brompton, L

Carmichael of Kelvingrove, L.

Hunt, L

Cledwyn of Penrhos, L

Jacques, L

Collison, L

Jenkins of Putney, L

Cooper of Stockton Heath, L

John-Mackie, L

Dacre of Glanton, L

Kearton, L

David, B

Kilmarnock, L

Dean of Beswick, L

Lawrence, L

477

Leatherland, L.

Ross of Marnock, L.

Listowel, E.

Seear, B.

Llewelyn-Davies of Hastoe, B.

Sefton of Garston, L.

Lloyd of Hampstead, L.

Simon, V.

Lloyd of Kilgerran, L.

Stallard, L.

Longford, E.

Stewart of Alvechurch, B.

McIntosh of Haringey, L.

Stewart of Fulham, L.

MacLeod of Fuinary, L.

Stoddart of Swindon, L.

McNair, L.

Stone, L.

Mar, C.

Strabolgi, L.

Mayhew, L.

Strauss, L.

Milverton, L.

Taylor of Gryfe, L.

Molloy, L.

Taylor of Mansfield, L.

Mulley, L.

Tordoff, L.

Nicol, B.

Underhill, L.

Oram, L.

Wallace of Coslany, L.

Paget of Northampton, L.

Wedderburn of Charlton, L

Peart, L.

White, B.

Ponsonby of Shulbrede, L. [Teller.]

Wigoder, L.

Wootton of Abinger, B.

Rathcreedan, L.

Young of Dartington, L.

NOT-CONTENTS

Abercorn, D.

McAlpine of Moffat, L.

Adeane, L.

McAlpine of West Green, L

Airey of Abingdon, B.

Mackay of Clashfern, L.

Alexander of Tunis, E.

Macpherson of Drumochter, L.

Auckland, L.

Avon, E.

Mancroft, L.

Belhaven and Stenton, L.

Mansfield, E.

Bellwin, L.

Margadale, L.

Belstead, L.

Marley, L.

Blake, L.

Maude of Stratford-upon-Avon, L.

Boyd-Carpenter, L.

Bruce-Gardyne, L.

Merrivale, L.

Caithness, E.

Mersey, V.

Campbell of Croy, L.

Middleton, L.

Carver, L.

Molson, L.

Clitheroe, L.

Morris, L.

Cockfield, L.

Mottistone, L.

Cottesloe, L.

Mowbray and Stourton, L.

Craigavon, V.

Munster, E.

Daventry, V.

Murton of Lindisfarne, L.

De Freyne, L.

Northchurch, B.

De La Warr, E.

Nugent of Guildford, L.

Denham, L. [Teller.]

Onslow, E.

Drumalbyn, L.

Orkney, E.

Duncan-Sandys, L.

Pender, L.

Effingham, E.

Plummer of St. Marylebone, L.

Ellenborough, L.

Elliot of Harwood, B.

Porritt, L.

Elphinstone, L.

Portland, D.

Elton, L.

Rankeillour, L.

Faithfull, B.

Rodney, L.

Fraser of Kilmorack, L.

St. Davids, V.

Glanusk, L.

Saltoun, Ly.

Glasgow, E.

Sempill, Ly.

Glenarthur, L.

Shaughnessy, L.

Glenkinglas, L.

Skelmersdale, L.

Gormanston, V.

Soames, L.

Gray of Contin, L.

Somers, L.

Gridley, L.

Spens, L.

Hailsham of Saint Marylebone, L.

Strathspey, L.

Sudeley, L.

Halsbury, E.

Suffield, L.

Harvey of Prestbury, L.

Swansea, L.

Hawke, L.

Swinton, E. [Teller.]

Henley, L.

Terrington, L.

Home of the Hirsel, L.

Teynham, L.

Hornsby-Smith, B.

Thorneycroft, L.

Howard of Henderskelfe, L.

Torphichen, L.

Hylton-Foster, B.

Trefgarne, L.

Ilchester, E.

Trenchard, V.

Killearn, L.

Trumpington, B.

Kinloss, Ly.

Vaux of Harrowden, L.

Kinnaird, L.

Vickers, B.

Lane-Fox, B.

Vivian, L.

Lauderdale, E.

Waldegrave, E.

Long, V.

Wise, L.

Lyell, L.

Resolved in the negative, and Motion disagreed to accordingly.
4.23 p.m.
Lord Mottistone: I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
[Amendment No. 64 not moved.]
Clause 6 agreed to.
Clause 7 [Power to license systems]:
Lord Bruce of Donington Lord Bruce of Donington moved Amendment No. 65:
Page 8, line 10, after ("Director") insert ("and subject to approval by a resolution of each House of Parliament")
The noble Lord said: I beg leave to move the amendment standing in my name and in those of my noble friends. It may be for the convenience of your Lordships if Amendments Nos. 65 and 66 are discussed together.
Amendment No. 66: Page 8, line 13, after ("Director") insert ("and subject to approval by a resolution of each House of Parliament")
The events of the last half-hour or so, if they have done nothing else, have certainly demonstrated the need for a rather firmer accountability to Parliament on these very crucial matters under discussion. Your Lordships will be aware that under Clause 7 licences may be granted by the Secretary of State after consultation with the director and, with the consent of or in accordance with a general authorisation given by the Secretary of State, by the director himself.
What this amendment seeks to do is to subject both these options to the final approval of both Houses of Parliament. As I say, I think the events of the last half-hour have shown how very necessary this is. At the moment, we have only one licence, and that is not a licence. We have one licence which was issued on 25th October 1983, is labelled "draft", and is headed:
"Licence granted by the Secretary of State for Trade and Industry to British Telecommunications".
It is admitted by the Government that this is not yet finalised.
One thing is perfectly clear: the contents of this licence governing the relationship between the Secretary of State for Trade and Industry and British Telecom and also the director himself are of the utmost importance, because even though the outlines and decisions in principle are made by the Bill the detail, of course, is in the licence. Efforts to bring matters that are in the licence into the Bill have so far been very fiercely resisted by the Government, and therefore we wish that when the final licence has been determined—and let us hope that it will not take very much longer—and before it is finally made, Parliament shall have an opportunity to consider it. What is wrong with that?
Noble Lords opposite, when they are talking on party platforms—and I would not wish to deny them the pleasure: we all do it in one way or another—preach the virtues of open government. They are in effect saying to the public, "Look, we have nothing up our sleeves at all". Then why is it that at one stage during the passage of this Bill through another place, depending as it did to a very large extent on the contents of the licence, even copies of the draft

479
licence were not available? It was only with some difficulty that one obtained it here, thanks to the courtesy of your Lordships' Library and the copying facilities that are so fortunately made available in the Palace of Westminster.
I do not want to go through the contents of the licence, and the noble Lord, Lord Mottistone, can be relieved that I am not going to make another Second Reading speech. However, for the edification of your Lordships, in regard to last Thursday's proceedings may I point out that 57·8 per cent. of the time on that day was occupied by the Government and their supporters; 11·8 per cent. by the Alliance; 7·1 per cent. by the Cross-Benches; and 27·3 per cent. by Labour. So I hope that the noble Lord, before he starts reflecting on the evils of Second Reading speeches, will bear in mind that, so far, on a Government Bill the Government have done about twice as much talking as everybody else. Therefore, in this particular case perhaps I may be forgiven for insisting, even though it may not be palatable, even though some may call it a Second Reading point, and particularly in the light of the confusion the Government have apparently got into in regard to their own Bill, that Parliament ought to have an opportunity of approving the licence.
Major licences will not be granted, so it is no good the noble Lord coming back and saying that there will be scores of important licences granted over the next few years, which would impose too much demand on parliamentary time and would become boring to another place or to your Lordships' House. That is not the case at all. We have an undertaking by the Prime Minister, no less—and those undertakings are presumably important—that, in any event, there will be only one major licence. In a letter to Mr. Richard Shepherd, the Conservative MP for Aldridge-Brownhills, the Prime Minister said:
"An open and unregulated market would inevitably lead to a concentration on the lucrative business market at the expense of the less profitable domestic rural services, public call boxes and the emergency services which run at a loss. I am determined to protect these services, which is why we took the decision that Mercury should be the only national network provider to compete with British Telecom."
So the noble Lord cannot get up and say that there will be lots of licences granted and that there would he an undue imposition on parliamentary time.
Ultimate parliamentary approval by affirmative resolution of this vital licence, when it is finalised, is essential to secure any kind of parliamentary control. I shall say no more upon the subject, save to commend the amendment with confidence to all your Lordships who believe in the proper exercise of parliamentary democracy, free from the diktat of an Executive which apparently cannot make up its mind on a whole series of matters in regard to this Bill. I beg to move.
Lord Mottistone: I do not know how the Government would like to play this. My Amendment No. 71 could be said to be vaguely connected with this amendment, but I would rather move it separately. Do the Government wish to take these amendments together in one monster debate, or would it be better to deal with this as a separate issue?
Lord Cockfield: As the point of principle raised in Amendment No. 71, in the name of my noble friend
480
Lord Mottistone, is the same as the point of principle raised in this amendment, it would certainly be, in my opinion, for the convenience of your Lordships to talk about both of them.
Lord Bruce of Donington: I should like to be of as much assistance to the noble Lord as possible. But in view of the remarks that have fallen from the noble Lord, I am bound to say that the principles are not the same, since the amendment proposed by the noble Lord, Lord Mottistone, seems to enshrine a principle of 25 per cent., which has nothing to do with the amendment which we are now discussing. We on this side do not wish to be a party to the passing of an amendment which, on the face of it, gives consent to the 25 per cent. principle.
Lord Cockfield: Perhaps I did not make myself clear. There can be no question of the amendments being voted on or moved together. It is simply that I think it would be for the convenience of the Committee, because I should like to make certain suggestions in this field which I hope will be helpful. It would be more convenient if I could make them in response to the views of your Lordships on the whole of the field. I am simply trying to be helpful in this instance—not to make any specific point.
Lord Mottistone: With that in mind—and I trust that the noble Lord, Lord Bruce, does not object too much—perhaps I may comment on both his amendment and my Amendment No. 71, which I shall naturally move separately when the time comes, depending on how the debate has gone.
The difference between these two amendments, as the noble Lord made clear, is that we seek to have the licence laid before Parliament only for those companies in the telecommunications field which are themselves monopolies, and the figure of 25 per cent. is one that is derived from the guidance notes on the Competition Act 1980. To mention the proposal of the noble Lord, Lord Bruce, I think that it would be unreasonable to have all licences laid before Parliament, because in the passage of time there would be a very great number of them and, quite apart from the fact that, in the nature of things, parliamentary time would be wasted, they would probably get a cursory glance and it would therefore be a waste of time. Therefore, I would strongly resist the amendments of the noble Lord, Lord Bruce.
However, the licences of monopolies need to be debated before ratification, and I shall be very interested to hear if my noble friend has another way of doing it. But just to have a licence placed before us—and we are a little worried as to when we will see the licence; whether we will see it in time for parliamentary comment or whether it will suddenly appear in its final form just after we have gone into the Summer Recess, or something of that nature—would be a great worry.
I am concerned only about the licence of vast monopolies and, currently, British Telecom is the only one in this field before us. I suggest that the views of customers—that is, the users—and of competitors are crucial to ensure a reasonable and cost-effective service to customers and fair competition to

481
competitors, particularly the smaller ones. This is absolutely essential. The whole worry on my part, and on the part of others of your Lordships who have the same view, is that there is a risk that the large monopolist will exercise powers, possibly even unwittingly, which he should not.
I suggest that the large monopolist and the naturally uncommercial Oftel cannot be sure of arriving at a fair balance in deciding on the licence. Of course, the same would apply in the interim, before Oftel gets going, to the department concerned, because, once again, it is not in the business of being commercial, and people who are not in the business of being commercial will not necessarily be able to arrive at a fair conclusion when the other person debating the licence is the vast monopolist.
Apart from the many concerns on the part of business about many of the conditions in the current draft licence that we have before us, to which I shall return, it is also a fact that the POUNC, as representing the ordinary user, has comments—and very valid comments, in many respects—on a vast number of the conditions. So there is not only concern among the users as to whether they will get value for money and be fairly treated from their end, but there are also the strong views of business, which not only fears anticompetitive practices in the future, but has many examples of anti-competitive practices at this very moment. I shall not weary your Lordships with details of those, but there are many right across the board.
Therefore, it is important that the licences of large monopolies should be debated. I am not altogether happy about my amendment in this respect, because it refers to a statutory instrument—as, indeed, did one of the amendments of the noble Lords opposite. A statutory instrument cannot be amended by both Houses of Parliament. I suspect that in the case of a licence Parliament needs both to examine and amend the licence, if that is what Parliament believes would be a good plan. If, therefore, my noble friend could indicate to the Committee how he visualises this problem being met and could let us know the views of the Government, I should be grateful. I have it in mind to press my amendment if the Government cannot give me a satisfactory reply, but that is for the future as there are other amendments to be dealt with first.
4.41 p.m.
Lord Cockfield: This is a matter of great importance because it touches upon the proper role of Parliament. I hope, therefore, that I shall be forgiven if I speak at considerable length upon it. It would only be right for me to analyse the background situation in order to indicate why we have come to certain conclusions.
In this country, as opposed to the United States, there is no formal separation of powers between Legislature and Executive, between Ministers and Parliament. The division of responsibility and of power rests upon practice and precedent. Indeed, the balance of power is shifted from time to time. Sometimes one is in the ascendant, sometimes the other. But wherever lies the balance of power, the two are bound together in an indissoluble partnership. In recent years, Parliament has sought to increase its powers over the Executive, to expand the area of
482
scrutiny and examination. But no Parliament has sought, still less succeeded, in extending its powers to the extent that noble Lords opposite have sought to do in the amendments they have tabled to the Bill. The noble Lord, Lord Stoddart of Swindon, has argued that there must be a first time for everything. That is a nice philosophical point—as, no doubt, the chicken would have said to the egg. But be that as it may, there is nothing worse than adopting a bad proposition on the argument that it will enable you to create a bad precedent for the future.
The broad dividing line which has always been drawn is that Parliament lays down the rules, and within those rules the administration deals with individual cases. That is precisely what the present Bill does. It defines the duties of the Secretary of State and of the director general in Clauses 3 and 7 of the Bill and elsewhere, and within the ambit of those duties it is for the Secretary of State and the director general to issue the licences and determine the terms of' the licences. That is entirely right and proper. The regulatory system established by the Bill is designed to be free from political interference so that those responsible for the management and direction of firms in the telecommunications industry can plan ahead on the basis of a stable environment. This is why the Bill creates the office of Director General of Telecommunications at the head of his own non-ministerial department and why the role given to the Secretary of State is limited in the way that I shall describe.
Once the Secretary of State has issued a licence, the monitoring, the enforcement and, where necessary, the modification of licences becomes the responsibility of the director. Enforcement is entirely a matter for the director. He has powers to make orders requiring compliance with licence conditions, and he has powers, if necessary, to enforce such orders through the courts. Licence modifications are also a matter for the director. He may, after public consultation, agree, licence modifications with the licensee or, in the event of a failure to agree, refer the matter for independent assessment by the Monopolies and Mergers Commission.
The Secretary of State's only general powers in relation to licence modifications are that he may insist on a Monopolies and Mergers Commission investigation before the director makes a particular change. In the very special circumstances where he judges that it will be against the interests of national security or our relations with the government of another country, the Secretary of State may also veto a licence modification. The director general's independence is central to the structure of the Bill and to the Government's proposals for the regulation of telecommunications. The amendments, as drafted, would strike at the heart of his independence.
The amendment in the name of the noble Lord, Lord Bruce of Donington, would require every licence to be approved by both Houses of Parliament. The later amendment, in the names of my noble friend Lord Mottistone and other noble Lords, would require "the particulars of the … licence" to be embodied in an order or statutory instrument where the licensee controlled more than 25 per cent. of the market. Perhaps I might comment first on this amendment. A

483
statutory instrument of the kind contemplated could be modified only by another statutory instrument made by Parliament. This would end the director's independence, would render a great part of the director's activities subject to direct parliamentary control, and would strike down the carefully prepared arrangements for the modification of licence conditions set out in Clauses 12 to 15. The procedure would also reintroduce short-term political considerations into telecommunications when it is one of the prime aims of privatisation and of the Bill to insulate from such considerations those who undertake the long-term work of planning and building telecommunications networks.
At the practical level and leaving political considerations on one side altogether, all in telecommunications have told us that we need swift-acting procedures to deal with any problems that may emerge, particularly when British Telecom itself, or another licensee, engages in anti-competitive practices. In contrast, the preparation of statutory instruments is necessarily slow and cumbersome. This consideration is important, not just to enable prompt action to be taken on anti-competitive practices but also because telecommunications are developing rapidly and licences may need to be amended to take account of changing circumstances. If amendment could be made only by statutory order it would introduce great rigidity into the system and inhibit changes which ought to be made.
There is the further objection that Parliament cannot amend a statutory instrument. It can only approve or reject. This would be a further element of inflexibility. Clearly Amendment No. 71 could not be accepted in the form in which it has been proposed. I suspect that it will come as no great surprise to the noble Lord, Lord Bruce of Donington, if I say that I cannot accept his amendment, either, in the form in which it has been proposed. Apart from the considerations I have already mentioned, it would, require every single licence issued to be approved by Parliament. Thousands of licences have been issued by British Telecom for private telecommunications systems under the existing legislation. All of these will require to be re-cast and re-issued to accord with the new legislation. I do not believe that Parliament would seriously he interested in these documents. But I ask the noble Lord, Lord Bruce of Donington, not to abandon hope. I think that his interest, as well as mine, really rests in the much smaller number of licences which, if I may use the phrase, set the tone. Indeed there was one phrase that he used in the course of his own speech which led me to believe that.
It is with this group of key licences that Amendment No. 71, in the names of my noble friend Lord Mottistone and the noble Lords, Lord Taylor of Gryfe, Lord Lloyd of Kilgerran and Lord Spens, to which I have already referred, is also concerned. I have explained in some detail why I do not think that actually incorporating the licence in a statutory order is the right approach. Nevertheless, I recognise, and indeed share, the view that Parliament should have the opportunity of scrutinising the British Telecom licence and certain other key licences. I acknowledge, too, the fear which is held in some quarters that the Secretary
484
of State might issue a licence substantially different from the draft which is now the subject of public consultation. While, as I have explained, I could not accept the amendments as drafted, there is an alternative and more effective route to solving the problem. The key lies in Clauses 8 and 9.
Clause 9 provides that the Secretary of State may by order designate as a public telecommunications system any system the running of which is authorised by a licence to which Clause 8 applies. By virtue of Clause 92, the Secretary of State's order has to be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament. By building on Clauses 8, 9 and 92 we can devise a procedure which will involve Parliament in a way which will meet the points which have been raised while avoiding the objections. Designation of a system as a public telecommunications system is not a formality. It makes the operator a public telecommunications operator and is essential for the running of a public system. Without public telecommunications operator status an operator cannot enjoy most of the privileges and protections afforded by Clauses 31 to 46 of the Bill.
The grant of a public telecommunications operator licence—that is, a licence to which Clause 8 applies—is necessary before the provisions of the telecommunications code contained in Schedule 2 to the Bill can be applied to an operator. British Telecom could not operate without a public telecommunications operator licence, and the Government intend to confer similar licences on Hull, Mercury and the two cellular radio companies. This point is important because it illustrates the ambit of the proposals that I am making. They will apply to all operators licensed under Clause 8.
Clause 9 therefore provides a way for Parliament to consider, and if it wishes to vote against, the designation of an operator like British Telecom as a public telecommunications operator. What I now propose is that I should table an amendment on Report providing that before any order made under Clause 9 enters into force, the text of the licence authorising the running of the system to which the order relates shall have been laid before both Houses of Parliament for not less than 28 days. This means that order and licence would he laid together at the same time. If Parliament was not satisfied with the licence in the form it was made, Parliament could pray and vote against the order designating British Telecom, or the other licensee concerned—because these proposals apply to all Clause 8 licensees; we are not singling British Telecom out specially—as a public telecommunications system. If this happened, the licensee would not be able to run its business. The Government would then have to come back to the House with a new order and a new licence meeting the objections which had been raised. If however Parliament was satisfied with the licence as granted, it need take no action and the Clause 9 order would stand unannulled.
I am very conscious of the strong view held on all sides of the Committee that Parliament should not stand completely aside: indeed, I share those views. The arrangements that I have suggested combine parliamentary scrutiny with arrangements to preserve

485
the independence of the director and the swift and flexible licence amendment procedures which are central to the regulatory process. They avoid the serious difficulties which would arise if the licence were actually itself incorporated in a statutory order. This is a genuine attempt to meet what I accept is a genuine concern. I hope that on the basis of the offer I have made that the noble Lord, Lord Bruce of Donington, will feel able to withdraw his amendment, and that my noble friend Lord Mottistone will take the same view.
Lord Bruce of Donington: I am greatly obliged to the noble Lord for his very constructive responses to the amendments that we have ventured to put down. They show a willingness; I am glad to have it confirmed that the Government are sensible of the very widespread view that Parliament should be more intimately involved. We should of course like to take a look at the amendment that the noble Lord proposes to introduce on Report. May I tell him how much we would appreciate it if he were constrained to adopt the affirmative procedure rather than the negative; that would sweeten it for us. But in general, and certainly without in any way committing ourselves to the principle enshrined in Amendment No. 71, in the name of the noble Lord, Lord Mottistone, we appreciate the concession, and I ask the leave of the Committee to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 66 to 68 not moved.]
Lord Somers Lord Somers moved Amendment No. 69:
Page 8, line 33, leave out ("may") and insert ("shall").
The noble Lord said: This amendment and the one following, Amendment No. 70, hang together, since one of course affects the other. It was only I think a fortnight or so ago that we had a considerable discussion on the relative merits of "shall" as compared with "may". These licences, which I think we have all agreed are going to be very important, are to be issued by the Secretary of State. But I must point out that in our present political system Secretaries of State come and Secretaries of State go. One Secretary of State may have very satisfactory and certain opinions on the matter. Another may have entirely different ones. I do not think that in that case one can just leave it to his decision. We must have compulsion and that, of course, will be provided by Amendment No. 70, which I shall leave to my noble friends to discuss. Their knowledge on this subject is rather more extensive than mine. I certainly think that a compulsory licence which must—not "may"—contain certain features is essential. I beg to move.
Lord Ezra: I should like to support the noble Lord, Lord Somers, in this proposition. It seems to me that, if one of the objectives is to ensure that the director and the Secretary of State conform, and to make sure that there is conformity with the important Clause 3, the word "shall" is much more appropriate than "may". For that reason alone, the amendment is worthy of support.
5 p.m.
Lord Mackay of Clashfern: I understand perfectly from what has been said the objective of the noble Lord, Lord Somers, in moving this amendment and the noble Lord, Lord Ezra, in supporting it. As Clause 7(5) is drafted, the Secretary of State has discretion as to whether or not he includes in a licence that he is granting conditions of the sort described in Clause 7(5)(a), (b) or (c). It is important to notice that this change would affect not only (a) but also (b) and (c).
I believe it is important that the Secretary of State should retain such discretion. There has already been mentioned the vast number of licences that are likely to he issued under the Bill. We tend to concentrate on the major ones—those to British Telecom, Mercury, Hull, the cellular radio companies and the cable companies. But there are very many others besides. Indeed, we expect that there may be some 3,000 licences to be granted. Obviously the vast majority of these will not be of any great public interest and there may well be cases where it would not be appropriate to impose all the conditions listed in Clause 7(5).
I should perhaps point out in this context that a licence is essentially a permission to do something that would otherwise be unlawful, and does not as a matter of course have to include conditions. An example may help. Entry phone systems for blocks of flats are telecommunication systems and as such will require a licence under the Bill. The most sensible way to do this is by a general licence but I doubt whether the Secretary of State necessarily wishes to charge for such a licence. But if he were obliged to, as he would be if this amendment were accepted, then the director could he in the nonsensical position of having to chase up the owner of every entry phone system in the country to ensure that he had paid the fee. I am sure that this is not what the noble Lord had in mind.
It seems to me that the concern is that the Secretary of State may not include conditions of the sort described in Clause 7(5)(a); namely, conditions to ensure that his Clause 3 duties are fulfilled. But this represents a misunderstanding of the nature of the duty in Clause 3. Whenever the Secretary of State, or the director, exercises any of his functions under the Bill which includes the issue of licences then he is bound by his Clause 3 duties. In other words, Clause 3 imposes a duty when he is exercising any of these functions. If, in the light of these duties, conditions should be included in a licence when he is granting it—and in the great majority of cases I accept that this is likely to be so—then they will have to be in the licence by virtue of the duty which flows from Clause 3. I hope I have satisfied the noble Lord's concern and that he will accept that, in the circumstances we are dealing with here, the power is appropriate in Clause 7(5), with the underlying duty coming from Clause 3.
Lord Ezra: Would the noble and learned Lord perhaps consider separating Clause 7(5)(a) and (b) and (c)? From what he said, he fully accepts that the Secretary of State and the director are bound to ensure that the duties imposed on them by Clause 3 are carried out. This does seem to weaken that responsibility as the clause is at present worded.
Lord Mackay of Clashfern: With great respect, I do not feel able to accept that last contention because the fundamental duty is in Clause 3 and it pervades all the Bill. To seek to make apparent strengthenings in some places might well weaken its full effect. Clause 3 imposes that duty and it is for the Secretary of State or the director to see whether conditions are necessary under Clause 7(5)(a) to implement that duty. I certainly appreciate, as I sought to point out, that (b) and (c) are in a somewhat different situation from (a). But the fundamental point remains that the underlying duty—the compulsitor, as it were—to put in such conditions as are necessary comes from Clause 3 and is clearly set out. It would damage the structure of the Bill to interfere with the way in which this is expressed. The clause gives the Secretary of State and the director all the necessary powers to ensure that they can properly comply with their duties in this direction.
Lord Molloy: Following the noble and learned Lord's submissions, can he explain this to me and to the Committee? It seems to me that if Clause 3 is the fundamental clause and everything laid down must be adhered to, then there is a slight deviation if the word "may" remains, because in law, as I understand it, above "will" a powerful word is "shall". Therefore, what the amendment submits is that there shall be total adherence to the initial clause which the noble and learned Lord quoted and that there shall be no deviation. Therefore, the amendment appears to assist the Government in maintaining regularity in the presentation of the Bill.
Lord Somers: I am most grateful to the noble and learned Lord hut, before withdrawing my amendment, may I point out that he referred several times to the Secretary of State. I think we can all have perfect confidence in the present Secretary of State, but what about in 20 years' time? We do not know who the Secretary of State will be and what he will be like. However, let us hope for the best. Meanwhile I beg leave to withdraw the amendment.
Lord Bruce of Donington: May I offer the noble Lord a way out of the difficulty, if he is so disposed? I suggest that he retains "shall" in subsection (5)(a) and tables a further amendment inserting "may" in (b) and (c). That would appear to overcome the objection of the noble Lord, Lord Ezra, with which I entirely agree. If the noble Lord will give an undertaking that on Report he will reproduce his evident agreement with the noble Lord, Lord Ezra, in amendment form he will make the Committee much happier. The Committee will not then resist any withdrawal of the amendment.
Lord Milverton: I support my noble and learned friend the Minister and the Government. I think the clause is satisfactory as it is now. If the amendment were pushed to a Division, I should support Her Majesty's Government.
Lord Mackay of Clashfern: I am extremely grateful for that support. I certainly wish to do what I can to please the Committee, as I was perhaps not particularly successful earlier. I feel that the correct structure is to have Clause 3 as imposing the duties and then
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confer in this clause the powers which are necessary to enable that duty to be carried out. To put the sort of distinction which the noble Lord, Lord Bruce of Donington, suggested between (a) on the one hand and (b) and (c) on the other is an unnecessary complication. I believe that the noble Lord, Lord Somers, has taken that point and appreciates that the duty in Clause 3 would apply to the Secretary of State and the director whoever they were.
Amendment, by leave, withdrawn.
5.10 p.m.
Lord Taylor of Gryfe Lord Taylor of Gryfe moved Amendment No. 70:
Page 8, line 34, leave out paragraph (a) and insert—
("(a) conditions requiring any person who is authorised by the licence to run a telecommunications system to agree to submit to arbitration any dispute relating to such systems and arising between such systems and a user of such systems if the user so chooses, the rules and procedure of such arbitration being those as may he approved by the Chartered Institute of Arbitration and the Director General;")
The noble Lord said: I am moving the amendment following representations from the Post Office Users' National Council which points out that in the event of a dispute all telecommunications users should have access to arbitration as an inexpensive alternative to taking action through the courts. It also points out that, while there is provision for arbitration in the licence—and, as one noble Lord pointed out last week, the licence has not yet been approved—there is no clause in the Bill which would enable users of services provided by any telecommunication operator to have access to arbitration. It is for that very good reason that the amendment is moved.
Lord Mackay of Clashfern: As your Lordships have just heard, the first part of the amendment is to leave out paragraph (a). I did not really understand the noble Lord, Lord Taylor of Gryfe, to explain that. I do not know whether that is necessary at all. I suspect that perhaps it is some kind of clerical inadvertence. I therefore go to the second part of the amendment, to which the noble Lord has spoken, which is the insertion.
That is designed to impose an obligation on the Secretary of State to include in licences conditions of the sort described in this amendment—that is, conditions which allow users to take disputes they have with the operator to arbitration. I fully appreciate the value of such conditions and will say a little more about them in a moment. However, I believe that it would be quite wrong to impose a requirement that all licences should contain these conditions. As I explained on the earlier amendments there will be a vast number of licences to be granted under the Bill—perhaps 3,000 or so—ranging from large licences such as British Telecom's, which are of great public importance, to many minor licences such as those for entry phones. I think it would be wholly inappropriate for all these licences to have to include conditions of the sort described in this amendment, and I do not think that this is what noble Lords have in mind.
Nevertheless, the Government fully appreciate the importance to consumers of having access to arbitration to settle minor disputes. This is why, as the noble Lord said, a condition to this effect has been included in the draft British Telecom licence in

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Condition 28. There is no need to have a specific provision in the Bill to enable such conditions to be included, since the combined effect of the duty in Clause 3(2)(a) to promote the interests of consumers and the power in Clause 7(5)(a) as the Bill stands already achieve this. In other words, if the Secretary of State and the director are satisfied that this is an appropriate thing to put in in the interests of consumers, these two clauses together achieve this.
The effect of the duty in Clause 3(2)(a) to promote the interests of consumers is that, where the Secretary of State in issuing licences believes such a condition is necessary, then it will be included. As I have said, such a condition will certainly he included in the British Telecom licence and it is the intention that a similar condition should also he included in the new licence to be issued to Mercury under the Bill.
Having regard to the vast range of possible licences, I would suggest to your Lordships that this is an appropriate way to proceed rather than by attempting to do it in the primary legislation itself. I hope that with that explanation the noble Lord will feel able to withdraw the amendment.
Lord Bruce of Donington: I hope that the noble and learned Lord will think again. As he says, a large number of licences may be granted. As he well knows, I do not mean what he would term the key or very important licences. But the fact that an individual licence includes an arbitration clause on the lines set out here does not mean that arbitration will arise in every case. We have numerous forms of contract; for example, the RIBA contract in the building and construction industry. The number of cases that go to arbitration is very small indeed. In some agreements the Institute of Chartered Accountants is very often designated as the arbitrator. The amendment would not expose anybody to considerable trouble. I think that the condition should go in the Bill in order to ensure that this is accomplished.
The noble and learned Lord says that the provision could go into the principal licence. The difficulty is that in later stages in the Bill the director general has powers, with the Secretary of State, to amend the terms of licences. We do not know how far licences will be amended. The Secretary of State might find certain sections of the licence inconvenient to him. He might therefore decide to ask for amendment to the licence. Indeed, there are powers later in the Bill to amend licences. Is it not far better to have a moderate and innocuous clause carrying no political overtones whatsoever? I suggest that it is far more satisfactory to have the provision in the Bill for the avoidance of doubt. I do not think that it will cause any extra disputes or arbitrations. On the rare occasions when they take place, the Bill will make the position unambiguous. I should have thought that that was in everybody's interests.
Lord Campbell of Alloway: I wonder whether my noble and learned friend could possibly think again. As has been pointed out, and as indeed is quite apparent, the option to arbitrate is exercisable only at the choice of the user. This is a useful provision which could do no mischief and could conceivably do good to the consumer. I have not heard the reasons for the
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objections of my noble and learned friend the Minister. I have an open mind until I hear them; but it seems a reasonable proposal.
Lord Morris: I am concerned about the necessity for the amendment. The Government's intention is made quite clear in Condition 28 of the draft licence, if the draft licence is anything to go by, whereby:
"The licensee shall include in the standard terms and conditions an inexpensive arbitration procedure".
This is extremely important. The noble Lord, Lord Bruce of Donington, and indeed the noble Lord, Lord Lloyd of Kilgerran, will recall the sandwich board man who used to parade outside the Law Courts. He was obviously a disgruntled litigant. The instruction read: "Arbitrate; don't litigate". Rumour had it that the Law Society and the Inns of Court paid his wages. They knew very well that in an arbitration there are no rules of procedure whatsoever and to the delight of all lawyers it becomes an extremely expensive operation. A great deal of care must be taken in putting a provision of this kind into statute. I am not really surprised that the noble Lord, Lord Lloyd of Kilgerran, did not speak to the amendment.
Lord Ezra: I should like to support those in favour of the amendment. If it is thought desirable to introduce it into the licence, if it is conditional and if it provides on the face of it an additional safeguard for users, it seems to me to be wholly in the spirit of the Bill and it is desirable to introduce it.
The noble Lord, Lord Morris, spoke of the possibility of arbitration being a very expensive process. If there is an argument against arbitration as such, arbitration should not figure in the licence at all. The fact that it is in the British Telecom licence, and in all probability it will be in all other major licences, seems to me to justify giving the provision the force of law as something which is desirable at any rate in these major licences.
Lord Mackay of Clashfern: In my submission to your Lordships, the way to have the provision in the major licences is that it be in the licences. The idea of putting it into the general provisions of the primary legislation would make it appear that it was appropriate for all licences. In view of what I have said about the great variety of types of licence, it would be inconceivable that one would have arbitration clauses of this kind in a good number of them. I hope that in the light of that the noble Lord, Lord Taylor of Gryfe, will feel able not to press the amendment.
Lord Taylor of Gryfe: I know that the noble and learned Lord is a very persuasive Minister and I am inclined to accept his argument. Considering the fact that already this afternoon the Government have made substantial concessions in the Bill, I do not feel like pressing the amendment to a Division, though to be honest I am not fully persuaded of the logic of the Minister's statement. If the point applies to 3,000 licences, it is unlikely that there will be 3,000 cases, but this provision is necessary in contracts and is frequently used in commerce. Quite frankly, I cannot see the undesirability of having that overall provision in the law just as a contingency. As the noble Lord,

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Lord Ezra, has said, if it is logical to have the provision in the licence, it seems logical to have it in the law. However, as I say, I have made my point and I do not feel like pressing it to a Division. I must consult other noble Lords who are interested in the amendment, but I should be prepared to withdraw it.
Amendment, by leave, withdrawn.
5.21 p.m.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 72ZA:
Page 9, line 9, leave out from ("of") to first ("a") in line 10 and insert ("paragraph (a) of subsection (5) above, conditions included by virtue of that paragraph in")
The noble and learned Lord said: In moving Amendment No. 70ZA, perhaps I may speak also to Amendment 70ZB:
Amendment No. 70ZB: Page 9, line 11, leave out ("include conditions requiring") and insert ("require")
These are technical amendments. Clause 7(5)(a) limits the content of licence conditions to matters which appear to the Secretary of State or the director to be requisite or expedient having regard to the duties under Clause 3. Clause 7(6) describes the form that conditions must take. However, it is intended that the limitation on the content of Clause 7(6) conditions should not be any different from that of conditions imposed under Clause 7(5)(a). As the Bill is drafted, that is not the case, and these amendments put the matter correctly. I beg to move.
On Question, amendment agreed to.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 70ZB:
[Printed above.]
On Question, amendment agreed to.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 70A:
Page 9, line 26, leave out subsection (8).
The noble and learned Lord said: In moving Amendment No. 70A, perhaps I may speak also to Amendment No. 150B:
Amendment No. 150B: Clause 94, page 83, line 30, at end insert—
("( ) For the purposes of any licence granted, approval given or order made under this Act any description or class may be framed by reference to any circumstances whatsoever.")
These are tidying up amendments and I believe that it would be useful to introduce them. Amendment No. 150B introduces into Clause 94 a new subsection to bring together in a single place all references to descriptions or classes being framed by reference to any circumstances whatsoever and therefore enables the earlier clauses to be reduced in size. I beg to move.
On Question, amendment agreed to.
Lord Mottistone Lord Mottistone moved Amendment No. 71:
Page 9, line 30, at end insert—
("( ) Before granting a licence under this section to any telecommunication company with more than 25 per cent. of a particular market, the Secretary of State shall lay an order embodying the particulars of the proposed licence for the approval of both Houses of Parliament.").
The noble Lord said: I am very grateful to my noble friend for the remarks that he made on this amendment when we debated it earlier and I greatly appreciate the distance he moved to accommodate the principle behind my amendment. I should like to put two questions to my noble friend. First of all the noble Lord. Lord Bruce, made the point that affirmative procedure would be welcome. I think that I would support that view because there could be an occasion when the provisions of Clause 9 were about to be put into effect just as a Recess was starting and we should then find ourselves unable to handle the statutory instrument because the negative procedure would be involved. So I hope that my noble friend will give special thought to that question.
I turn to the other point which occurs to me. Elsewhere in the Bill there is provision for modifying licences. As I understand it, when the Clause 9 procedure is instigated, the order relating to the licence will be placed before both Houses of Parliament. What happens thereafter to amendments and modifications to the licence? I ask that because presumably the order under Clause 9 will not be retabled each time there is a modification. Some of the modifications might be rather important. Would there be a system to take account of that? If my noble friend does not have an immediate answer, it would be helpful to know that he is giving thought to the matter with a view possibly to returning to the Chamber with a statement at some future date. I beg to move.
Lord Cockfield: With regard to the first question raised by my noble friend, we have of course met this point on almost every single occasion upon which either this or any other Bill provides for a statutory instrument to be made, and invariably the Government have proposed the negative procedure and invariably the Opposition have proposed the affirmative procedure. The time may come when we have to fight this one out. We ourselves believe that the negative procedure is the correct procedure in a case of this kind. So far as the 28 days are concerned, perhaps I may write to my noble friend to elucidate the particular point that he raises.
On the question of the modification of licences, I would suggest that my noble friend reads very carefully the statement that I have made because the point that he now raises was in fact covered in that statement. A very careful regime is set out in Clauses 12 to 15 of the Bill, which deal with the procedure to be adopted in the case of modifications. It is important to make the point that the Secretary of State does not come into that procedure. The modifications may be made by the director by agreement with the licensee, but, if there is no agreement, they must be referred to the Monopolies Commission, and the Bill then goes on to provide that a recommendation by the Monopolies Commission must be carried out by the director. So we believe that we have that point properly tied up. However, if after he has read what I have said my noble friend wishes to come back on any other point, I shall be only too pleased to try to clarify it.
Lord Bruce of Donington: The noble Lord has shown a most constructive attitude towards this amendment and the earlier one which I had the

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honour of moving on behalf of myself and my noble friends. The noble Lord touched on the question of modifications and it would be most helpful to the Committee if he could deal with a situation where the licence modifies itself in the passage of time.
I have in mind, for example, Condition 24, which refers to the most important RPI minus X formula, which has been sold to the general public very largely as being one of the reassurances that the Government have no evil intention in regard to the consumer. It will be observed that in Condition 24.1 the RPI minus X percentage is due to expire on 31st July 1989. That has nowhere been explained in the political observations made not only by noble Lords opposite, but also by Members in another place. If any fortification of that point is required, I would say that the noble Lord will doubtless be well aware of the letter which Mr. Baker contributed in October last to the Economist, in which he made no mention of this limitation. Even though the public may to some extent have severe misgivings, which I am sure is the case, they have been partially reassured by the RPI minus X percentage factor by which charges are prevented from rising by more than a certain percentage in relation to the retail price index. What the public have not been told, and what they must be told, is that this undertaking applies for five years only.
I wish to ask the noble Lord how this situation is dealt with vis-à-vis parliamentary control. Here, in Condition 24.1, is a licence that modifies itself by excluding the provisions of its own clause after a period of time. How will Parliament take control of that? Perhaps the noble Lord will be able to reassure the House, and I am sure the country, by saying that, as this is only a draft licence and not yet in its final form, the time limitation, when it comes to the final form, will he eliminated. If the noble Lord can say that, we shall all be reassured and even happier than we have been made by the noble Lord on a number of other matters on which he has been most constructive this afternoon.
Lord Cockfield: The noble Lord is entirely correct in so far as he says that the RPI minus X formula is written in for a period of five years. This, I understood, was fully known. We would hope that, at the end of that period, competition would have developed in such a way that the formula was no longer necessary. But the Bill contains provisions to deal with such a contingency. The director is put in with a duty—it is important to stress this—to protect, inter alia, the interests of consumers. If, therefore, he felt, in pursuance of his duty, there should be some continuation of the RPI minus X formula, then it would be his duty to suggest a modification of the licence procedure accordingly. If the licensee refuses to agree, the next provision comes into effect; namely, Clause 13 of the Bill which we shall be discussing in due course. If the licensee refuses to agree, the director may then refer the matter to the Monopolies and Mergers Commission. If the commission comes to the conclusion that some such provision should be continued or inserted in the licence and recommends to that effect, then, under Clause 15, the director shall make such modifications as appear to him requisite for the purpose of remedying the adverse effects specified
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in the report. I think, therefore, that we have dealt with this contingency very fully.
Lord Mottistone: Once again, I thank my noble friend for his great concession. I beg leave to withdraw the amendment.
Lord Weinstock: In view of the earlier tenor of discussion in Committee, I have been agreeably surprised by the atmosphere of light and constructiveness that has pervaded the Committee's deliberations today. I hope that your Lordships will grant me indulgence in that my lack of experience in parliamentary affairs does not leave me entirely clear whether the assurance given by the noble Lord, Lord Cockfield, means that the licence will be laid before Parliament and will be discussed and approved by Parliament before it becomes effective and that the terms of the licence will not be settled between BT and the Secretary of State in any way that will affect the placing of shares in British Telecommunications plc until that has happened.
Amendment, by leave, withdrawn.
[Amendment No. 72 not moved.]
On Question, Whether Clause 7, as amended, shall be agreed to?
Lord Bruce of Donington: I speak on clause stand part if only to give the noble Lord an opportunity of replying to the point put by the noble Lord, Lord Weinstock. The noble Lord, Lord Weinstock, may not have been aware of the precise terms of the debate in which the point of the earlier amendment in the name of myself and my noble friends was concluded.
There is another point that I should like the noble Lord to explain. If the licence of British Telecom was incorporated in the Bill, it is the position, according to my understanding, that the Bill, being in favour of a specific institution, would automatically be made into a hybrid. I should like confirmation formally on that point. Otherwise, there are reasons why the licence, before it is granted, should be subject to Parliamentary debate. I believe that the assurance so far given by the noble Lord amounts to the fact that on Report stage an amendment will be introduced that will result in the licence to BT being debated when it is finalised and put formally to the House for confirmation. So there will be some debate on it even though, by its particular structure, the House will not be able to amend it. Perhaps the noble Lord will confirm that.
Lord Cockfield: May I first reply to the noble Lord, Lord Weinstock. I would ask the noble Lord to read the statement that I made. This is a very complex and difficult matter. The statement was very carefully considered. The short answer to his point is that the licence, which will be made at the same time as the order, is, in its final form, a signed licence. That is essential if we are to meet a criticism that the Secretary of State might alter the terms of the licence between the time that Parliament saw it and the time that it was granted. If Parliament does not like the licence in the form that it has been granted, it then votes against the statutory order. If it strikes down the statutory order, then de facto, not de jure, it strikes down the licence as

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well. You have therefore this complete flexibility which means that all the points that have been raised are met. It is because the legal position is such an intricate one that I would ask the noble Lord to read the statement that I have made. If there is any point on which he feels that further elucidation is required I would be glad to give it.
On the point of hybridity, this matter, as the noble Lord, Lord Bruce, will be well aware, is one of great complexity. I think that I am not wrong in saying that a ruling on this point is more a matter for the House authorities than for me. Nevertheless, we were acutely aware of the risks of hybridity. That is why we proceeded by taking Clause 9 as the basis. Clause 9 relates to a class or group. I endeavoured in my statement to indicate the people who were likely to be within that class or group. All of us know who the important ones are going to be. However, because it is a class or group covered by a clause in the Bill, it does not get into difficulties on the hybridity point.
Lord Morris: Before we leave Clause 7, I wish only to draw attention to the penultimate word on page 8 in subsection (5)(b). I feel sure that officials have picked up this mis-spelling although I will be rather sad to see it go as it conjures up a delightful picture of the Secretary of State considering fees in a most exotic and aromatic atmosphere.
Lord Cockfield: I am sure that the point has been noted and will he dealt with in the appropriate fashion.
Clause 7, as amended, agreed to.
[Amendment No. 73 not moved.]
5.40 p.m.
Lord Campbell of Alloway Lord Campbell of Alloway moved Amendment No. 73A:
Alter Clause 7, insert the following new clause:
("Procedural measures of safeguard.
.—(1) A decision to grant, vary, or refuse a licence under the provisions of this Act or of the Cable and Broadcasting Act 1984 shall not be made unless and until—

(a) consultation shall have ensued between the Director and the Cable Authority;

(b) written observations as to terms and conditions of grant, variation, or grounds of proposed refusal shall have been exchanged between the Director and the Cable Authority;

(c) a copy of such written observations shall have been supplied to the applicant; and

(d) the applicant shall have been afforded an opportunity of making written and oral representations on such observations in support of his application.

(2) The decision mentioned in subsection (1) above shall be a reasoned decision in writing.").
The noble Lord said: I beg to move the new clause, Amendment No. 73A, which stands in the name of the noble Lady, Lady Saltoun, my noble friend Lord Mottistone, the noble Lord, Lord Spens, and myself. This amendment is not concerned in any way with designation under Clause 8 to which, as I understand it, my noble friend the Minister intends to introduce an amendment on Report. This amendment is concerned with something quite different.
The origin of the clause was in Amendment No. 108B of the Cable and Broadcasting Bill, and its sister amendment—Amendment No. 73—to this Bill.
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During the Committee stage the amendment, in its original form, was found by the noble Lord, Lord Mishcon, in particular, to be open to three objections. The first was that the drafting was too detailed. The second was that the drafting could involve possible disclosures of confidential documents and legal arguments. The third objection was that the full review procedure of such a decision was not appropriate.
I took full note of those objections and I am indebted to the noble Lord for his reasoned analysis which appears at cols. 838 and 839 of the Official Report for 2nd February. I have sought to defer to the reasoning of his analysis in drafting Amendment No. 73A which I move before your Lordships at this time, it being in the same terms—and this is important—as the sister amendment already tabled for Report on the Cable and Broadcasting Bill.
To use the words and the concept (if I may borrow them) of the noble Lord, Lord Misheon, I have tried to secure that all applicants for licences have a fair deal; to secure a minimum requirement within the basic principles of natural justice; and to provide a safeguard against abuse of administrative discretion. There must surely be consultation between these two bodies before the grant, the variation or the refusal of a licence by either. Of course, I take on board the fact that variation is expressly covered by Clauses 12 to 15.
However, that, on an analysis in depth—in which I shall certainly not seek to indulge in opening this amendment—is hardly sufficient. It is hardly sufficient because in any event an applicant should be entitled to know the provisional objections which he has to face after consultation between these two bodies has ensued. The applicant must be entitled to make representations in support of his application and he must be entitled to a reasoned decision which must be handed down. It is suggested that such are the minimum procedural measures of safeguard and that is precisely what this and its sister amendment seek to achieve—minimum procedural measures of safeguard requisite to reflect the requirements of natural justice and to secure a fair deal for all applicants. On the previous occasion at the Committee stage of the Cable and Broadcasting Bill, the noble Lord, Lord Harris of Greenwich, strongly supported this concept and again I acknowledge my indebtedness to him for his support.
In conclusion, were this amendment to be adopted it will only be possible for the courts to interfere with the licensing decision on grounds of want of due administration in the exercise of the general supervisory jurisdiction which the High Court exercises over all inferior tribunals. There can be no question under this amendment of the court substituting its own decision for that of the licensing authority. There is to be no full review; there is to be no appeal, and there is to be no hearing de novo. But the absolute discretion of the Executive will be mitigated by the provisions of this amendment which require compliance with natural justice and the handing down of a reasoned decision. If this is done, then the courts will have no jurisdiction, indeed no reason to interfere. This is put forward as a minimum safeguard. On behalf of the other noble Lords and the noble Lady whose names are associated with this amendment. I beg to move.
Lady Saltoun: The object of this amendment is to bridge the gap which yawns between Oftel and the Cable Authority. In view of the fact that different Government departments are not noted for cooperating with one another—to put it mildly—and that with both present and future developments such as Prestel, telebanking and teleshopping, cable and telecommunications are inextricably entwined, it is essential, whether the Government like it or not, that the duty of Oftel and the Cable Authority to cooperate should be clearly written into both this Bill and the Cable and Broadcasting Bill, because ministerial assurances, however sincere, have no legal force. Moreover, I believe that the bridging of the gap between Oftel and the Cable Authority will be welcomed by British Telecom who, because of the interplay between the two technologies, are not at all happy with the proposed dichotomy.
Earl De La Warr: I am extremely grateful to my noble friend Lord Campbell of Alloway for moving this amendment. Before I talk to it, I must declare my interest as a director of one of the new cable companies. I drew attention to the question of dichotomy of control as long ago as the debate on the cable White Paper in July, and I have talked to it whenever appropriate ever since.
The cable operators—both the present ones and those to come—are extremely concerned about the fact that this new, high-risk industry is to be controlled under two separate Acts of Parliament and administered by two separate authorities which will be under the aegis of two separate departments of state. I believe, with them, that, not only at the granting of the licence but right throughout the length of the cable operators' tenure, there is a danger of muddle.
The noble Lady, Lady Saltoun, referred to the fact that there was not always agreement between the two departments concerned. I do not want to go into the history of the matter, but when it became clear that this new industry was to be thus controlled, it immediately became as clear that there must be a statutory linkage between the two departments. Let me give your Lordships an example. Both Bills require that before licences are issued—the one by the Cable Authority and the other by Oftel—there shall be consultation and the receipt of representations from local authorities and from the public. Will these two authorities, which are quite distinct from each other, consult together? Will they go to the public together and present the case, and together receive representations? Of course, in all good sense they must.
However, like my noble friend and the noble Lady, I am deeply concerned to make sure that the two authorities work together, and I shall remain concerned until something is included in both Bills which links them together by statute. I do not ask my noble friend to take exactly the wording which appears in this amendment and which will, as he says, appear in exactly the same form in an amendment to the cable Bill. I do not want to hear detailed comments about exactly how we have dealt with it, although I believe that my noble friend has it exactly right.
I want an assurance from the Government that they have taken the point of the statutory need for
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consultation—one between the other, as equals—and that they will accept an amendment of this type, embodying all these principles, so that, when we come to the other Bill, we may see the two running alongside each other. That will go a very long way to mitigate the inherent difficulties that the industry must face in having to deal with two departments. Anything less than that will leave us very worried and will leave our supporters in this high-risk industry much less willing than they would otherwise have been to support this brave new experiment.
Lord Milverton: I should like to support my noble friend's amendment and I hope that Her Majesty's Government will be able to accept it or, as my noble friend Lord De La Warr has just said, give us an assurance that the principles behind it will be included in the Bill. I hope that the Government will either accept my noble friend's amendment or give an assurance that the principles behind it will be brought into the Bill.
Lord Howard of Henderskelfe: Like the noble Earl, I do not trust assurances. Governments change, different parties come to power, and the assurances of one Government are as nothing to the next. We are already in a thorough organisational muddle over cable. This has recently been enhanced by the transfer of the radio regulatory department—which one might think has nothing to do with cable whatever but which, in fact, does—from the Home Office to the department. At times one is tempted to ask: is this a private fight or can anyone else join in?
I believe that the various forms of consultation which are to be pursued in the future must be laid down very strictly in the Bill, because if they are not, there will be the muddle at the edges which some people erroneously think is the genius of British democracy, and I believe that we shall he asking for trouble in the future. This is not an easy Bill to understand; nor is the Cable and Broadcasting Bill. Let us do our best to ensure that with identical words in both Bills relating to consultation, there is no room for doubt whatever.
5.55 p.m.
Lord Mackay of Clashfern: Perhaps I may deal with the first aspect of the amendment—that is to say, consultation between the director and the Cable Authority—and then come to the more detailed aspects of it later. First, may I start with what is perhaps a truism, but nevertheless an important one. Cable systems are telecommunication systems in just the same way as is the telephone network. They are no different from other broad-band systems and the only reason that they have become generally known as cable systems is that it is proposed to send over them cable programme services, defined in both Clause 54 of the Bill and Clause 2 of the cable Bill.
In fact local cable telecom systems have an importance greater than simply the entertainment services that they will provide. They are expected to develop into major local telecom systems which in due course could come to rival the British Telecom local network. The Government have made it clear that they also wish them to offer services quite different

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from what we have defined as cable programme services. For example, the applicants for the pilot cable licences will be required to indicate what interactive services they would provide—services such as telebanking, teleshopping, and so on. Some applicants have also outlined their plans for two-way telecommunication services, including the provision of voice telephony services.
I hope that I have explained that the licensing of a cable telecommunication system involves much wider considerations than simply what I shall term, for the sake of brevity, "broadcasting considerations". Nor are the considerations simply those of setting the technical standards. There are vital economic and commercial considerations to be taken into account as well as the need to protect the physical requirement. These matters are not the concern of the Cable Authority. This is why the two licensing functions—that under this Bill and that under the cable Bill—are distinct.
Quite simply, there are different factors which are relevant to the issue of each licence which grants permission for different activities. These different factors and considerations are clearly set out in the two Bills. Under this Bill, in deciding whether or not to grant a licence, the Secretary of State will be bound by the duties set out in Clause 3. These we have already discussed and they represent the national telecommunications objectives. Similarly, in deciding whether to grant a cable programme licence, the Cable Authority must also have regard to statutory criteria set out in Clause 6 of the cable Bill.
As far as the running of a telecommunications system is concerned, the primary licensing authority is the Secretary of State. This is because the Government consider that telecommunications is too important for licensing to he given to an authority not directly responsible to Parliament. Of course, the Secretary of State may delegate this licensing function to Oftel, but he does not intend to do so in respect of important licences, and this includes those for wide-band cable telecommunications systems.
So far as cable programme services are concerned, the primary concern is the content of the messages that are sent, and the Government believe it right that judgments on such matters should not be taken by the Secretary of State but by an independent authority. This aspect of the amendment which we are considering has two aims. The first is to require the Secretary of State to consult with the Cable Authority before he issues a licence; and the second is to require him to take into account the Cable Authority's views on both the terms of the licence and how he is to interpret his Clause 3 duties. It may be more convenient if I take the second aim first because I think it is more easily dealt with.
I hope that I have shown your Lordships that there are different criteria and considerations which are relevant to the grant of each licence. Quite simply, matters such as the content of cable programmes, their quality and their origin are not relevant to the consideration of whether or not a telecommunications licence is to be granted. What is important in this connection is the duties in Clause 3. To require the
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Secretary of State to take account of the opinions of the Cable Authority would, in effect, mean that the appointed Cable Authority would be in a position to suggest to the Secretary of State, who is responsible to Parliament, how he should exercise his powers in relation to peforming the duties that Parliament has set upon him under Clause 3. In our view, it is for the Secretary of State and the director to make judgments in this area, guided by Clause 3, just as it is for the Cable Authority alone to make judgments in its area of responsibility.
However, this is not to say that both licensing authorities will operate without any regard for the other. This would not be a sensible way to proceed, and I am sure there will be close co-ordination. It is this close co-ordination that I think my noble friends and others who have supported this amendment are seeking to achieve by imposing a statutory requirement on the Secretary of State. As my noble friend Lord Elton explained in the earlier debate on the Cable Bill, such a requirement is unnecessary because there is already a requirement on the Cable Authority to consult. Noble Lords may well ask, "Even if it is unnecessary, what is the harm?" I shall try to explain why a requirement in this form would be inappropriate.
First of all, many telecommunication systems are capable of conveying cable programmes, not just those being run solely for the purpose of providing programme services: but the Cable Authority will have no interest in these systems, so it would be quite wrong for the authority to be consulted when these systems are licensed under the Telecommunications Bill.
Secondly, precisely because telecommunication systems can be run otherwise than for the provision of cable programmes, it is quite possible that when the runner of this system applies for a licence to the Secretary of State he does not intend that cable programmes requiring a Cable Authority licence shall be provided over it. This may come much later. Therefore, a requirement to consult at the initial licensing stage would be inappropriate. The only cases where a requirement to consult is sensible are those where a system has to be installed and operated for the primary purpose of providing cable programmes, but in this case there is already a requirement to consult through the obligation on the Cable Authority. I hope that I have said enough to convince your Lordships that a blanket requirement of the Secretary of State to consult in relation to each telecommunication licence would he unworkable and inappropriate.
Nevertheless, I am aware of the views of noble Lords and I accept that there will be merit in the Secretary of State, the director and the Cable Authority keeping in close touch about developments within each other's sphere of responsibility. Therefore, I undertake to consider further with my right honourable friends this aspect of the amendment to see whether we can devise an appropriate requirement which should be placed on the Secretary of State and the director for consultation.
I now turn to the other aspect of this amendment: the requirement to send written representation to the applicant and to enable him to make representations on them. I do not believe this is either necessary or desirable. First, in the case of variation of a licence, this Bill already provides for notice to be given by the

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director of any variations he proposes to make, and for representations to be made which the director must consider. These are in Clauses 12 and 15, and my noble friend Lord Campbell of Alloway has already referred to that aspect.
As regards the issue of licences, I do not think that giving written observations to the applicant and allowing him to make representations is an appropriate way to proceed. First of all, it would be quite impracticable in view of the large numbers of licences—perhaps 3,000—to be granted under the Bill. The licensing process would probably grind to a halt under the weight of the bureaucracy created. This would be a long way from the streamlined and efficient licensing procedures that the Government are trying to achieve under both this Bill and the cable Bill. It is not in the interests of either the telecom or the cable industry to have a highly bureaucratic licensing regime, but there are also objections in principle.
Where there are competing applications for a particular area, it will generally be the case that only one will be selected. Applicants therefore may be rejected for no reason other than that there was another application considered to be superior in the particular circumstances that I figured. To give each applicant access to written observations and associated correspondence would result in the licensing authorities having no alternative but to supply details of the commercial arrangements of the competitors. This is the point that the noble Lord, Lord Mishcon, made in relation to the same consideration when it was being discussed in connection with the cable Bill. The applicants would then be at liberty to make representations not just on their own case, but on those of the competing applicants; but in each case the duty which lies upon the Secretary of State and the director will be the duty imposed on him under Clause 3. If the Secretary of State and the director do not perform that duty of course they can be challenged in the courts in the normal way. In cases of maladministration it can be taken up with the ombudsman, whose ambit is extended to include the director by Schedule 1 of this Bill.
I hope in the light of the undertaking I have been able to give to your Lordships, my noble friend will feel able to withdraw this amendment, which we have certainly considered very carefully.
6.6 p.m.
Earl De La Warr: Before the debate comes to an end, may I say that I find myself very confused by much that the noble and learned Lord has said, because for about nine-tenths of his speech he did not appear even to have taken the point about what it is we were asking for. He referred constantly to the Secretary of State. We are asking for it to be written into statute that Oftel and the Cable Authority consult each other on the granting or modification of any licence. From hearing the noble and learned Lord, it seems that between us we have failed to make our point.
Here is a cable consortium which is able to lay the wire, it is able to put down, if you like, television programmes; it is able to produce the interactive service that he referred to. It is all one body. I must make the point quite clear that what is splitting this
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into two is the fact that the two great departments of state found themselves unable to come to any accommodation. The reason they found themselves unable to come to any accommodation—and I hope I am not teaching my grandmother to suck eggs because I must tell my noble friend a little history—is because for the past five years an argument has been raging between the Home Office and what we call the Ministry of Technology as to who should control broadcasting. There have been some very weighty arguments by senior statesmen of great weight. They have fought each other along with their civil servants and they have used—perhaps I should not refer to knives in this Committee. Right in the middle of this argument, which was nearly lost by the Home Office some 3J, years ago, and to my certain knowledge was nearly lost by them last year, cable comes in to complicate this argument still further.
They have therefore arrived at a political compromise and they have done so by the most extraordinary means. My noble friend would need to refer to the wording on the notes to the cable Bill in order to see how they have done it. They have said:
"For the purposes of this clause it must be accepted that the act of sending and the act of conveying are conceptually distinct".
That is how the two departments have got out of their dilemma.
Now, for my noble friend to take the line he has and pretend everything is perfect, and that it can be assumed by cable operators—whether they be operating already or whether they be applicants—that the way will be made easy because automatically these two authorities, bossed by these two warring departments, will consult with each other, is simply to take an attitude which I can only describe as living in cloud cuckooland. It is for this reason that we are pretty well convinced that the cable industry is unlikely to get off the ground as the Government as a whole intended —not just one department—if we do not get the assurance from the Government that these two authorities will have to consult with each other.
My noble and learned friend referred to the fact that in the Cable and Broadcasting Bill, I think under Clause 5(4), the Cable Authority was required to consult with Oftel along with local authorities. It was put in as almost a throwaway in one line. There is nothing in the Telecommunications Bill which says the same thing; nothing at all. It is what I called in another debate a universal blank. My noble and learned friend has talked as though he did not appreciate any of these things about which we are so anxious on behalf of a brand new industry.
At the end he has given what he regards as some sort of an undertaking to take a point which, by his speech, he clearly had not taken. He seems to expect us now to be satisfied. Of course we are not satisfied. We shall no doubt study what he has said, and I must leave the matter there to my noble friend, who will doubtless give the Committee the benefit of his views on what has been said.
Lord Ardwick: I have a good deal of sympathy with the words that the noble Earl has just uttered, and a good deal of sympathy too with the first part of the amendment. It seems to me obvious that there have to he legislative arrangements for collaboration. In the

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Cable and Broadcasting Bill these arrangements are most perfunctory. They have to be made specific. I hope that when the noble and learned Lord and his colleagues are looking at this—if they look at this question again—they will refer back to the White Paper because they have gone away from it in their answers this afternoon.
Lord Campbell of Alloway: I should like to thank all noble Lords, who have spoken from all sides of this Committee, who have shared my concern. I have absolutely no interest whatever to declare other than that of an ordinary lawyer who wants to see fair play done, and reasonable protection for the Queen's subjects in a statute. In that vein, I should like to say in particular to my noble and learned friend, speaking only for myself, that I am terrified not only at what I see in this Bill but at what I understand his attitude, with his ministerial hat on, appears to be.
On the first issue, the issue of consultation, my noble and learned friend produces a most interesting and most erudite deployment of the many considerations involved, entirely missing what I understood to be my main point. Why? With respect, I think it is because—and this shows this curious defect, this perishable thread, which the Ministry do not appreciate—the noble Lord, Lord Elton, on 2nd February at column 817, expressly recognised that it was requisite to have a degree of commercial compatibility between the two sets of licences. But my noble and learned friend today does not recognise that necessity. Hence the first aspect of genuine concern, without seeking to make too much of it or to repeat myself, but just to say that I am sure that from the Front Bench there will be close co-ordination, but what on earth does that mean? What safeguard does that give the subject? What is its value? None.
On the second point, which is that it is neither necessary nor desirable in any way to seek to curb the absolute exercise of discretion by the ministry, I for one will have none of it. I do not believe in absolute administrative discretion. Anyone who has been subjected to it either personally (which fortunately is not my case) or professionally (which often is) would have none of it, either. I once more ask my noble and learned friend to think again. This is not a tease of the Front Bench; this is not a political stance; it is an expression of genuine and real concern.
To talk about the ombudsman is wholly inappropriate, but time prevents me from saying why on this occasion. It is essential that the applicant should have a fair deal, and these are the minimum requirements by which he can be provided with a fair deal. In the battle of the civil servants to which my noble friend Lord De La Warr referred, what does it matter who are the Roundheads and who are the Cavaliers? We have now the conceptual distinction of the indivisible, which satisfies both sides.
This distinction is the distinction between the desire or facility to send a message and its actual conveyance by cable, and in that way everybody appears to be satisfied. But I hope not. This gap to which the noble Lady, Lady Saltoun, has spoken is real. It ought to be faced; it ought to be bridged; it ought to be dealt with sensibly. There should be, as the noble Lord, Lord
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Ardwick, has just observed, some form of mandatory statutory consultation between these two bodies. Those were not his terms, but I hope I do justice to his thought. Indeed, there must be this other aspect of natural justice.
I find myself in a difficulty. I would really wish, my concern being such, to divide your Lordships' Committee, but I do not think that would be prudent because it gives my noble and learned friend no fair opportunity to consider whether the concern expressed by your Lordships from all sides of the Committee is reasonable, is fair, and whether it ought to be met. It is in that vein that I would wish to give the Front Bench, my noble and learned friend the Minister, a further opportunity. But if that opportunity is not taken I reserve the right, with the other noble Lords who supported this amendment by tabling their names to it and who have spoken tonight in support, to bring this matter again before your Lordships on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 8 [Special provisions applicable to certain licences]:
The Deputy Chairman of Committees (Baroness Wootton of Abinger): I have to point out to your Lordships that if Amendment No. 74 is agreed to I shall not be able to call Amendments No. 74A, No. 75 or No. 75ZA.
[Amendment No. 74 not moved.]
6.20 p.m.
Lord Morris Lord Morris moved Amendment No. 74A:
Page 10, line 8, after ("system") insert ("of any other systems licensed under section 7 above and").
The noble Lord said: On behalf of my noble friends Lord Trenchard and Lord Mottistone I move this amendment, which stands in my name as well. The purpose of the amendment is solely probing. In so moving, I wish to point out at the outset that it is not so much that I ask for a detailed statement on policy from my noble friends on the Front Bench, for I believe that would be quite wrong. However, if they determine that they would prefer to let me and my noble friends know in writing that we may have some grain of comfort in this regard, that would be of great help.
As your Lordships are well aware, Clause 8 places a duty on the director to publish, in certain instances, the fact that he proposes to grant a licence by virtue of Clause 7, the reasons why he proposes to grant the licence and, in so doing, he shall give enough time on the granting of this licence for consideration of any representations or objections to that licence.
To put it in the vernacular, this will only apply to those licences which, for want of a better term, may be called the big licences. That is my understanding of the clause. That Her Majesty's Government, in tabling the Bill, are determined to grant licences to legal persons to connect to any system is quite clear as we know from the powers to licence systems under Clause 7. As to the application of Clause 8, it is clear from Clause 8(1)(b) that Her Majesty's Government will, in

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due course, be licensing corporations to connect systems and such apparatus in the future. Still further, if one looks to that draft licence, which does not exist, at Condition 13.1 it is even clearer; namely,
"the Licensee"—
the major licensee which we all know is the major operator of the public switched telephone network—
"shall … connect and keep connected to any Applicable System … any other Connectable System whenever the person running that system so requires".
Indeed, he must,
"provide other such telecommunications services as the Operator may reasonably require to secure that such connection is effected and maintained".
My reason for tabling the amendment is my concern that, by virtue of those same condition, there are considerable—to use the vernacular term—"copouts", by virtue of Conditions 13.3, 13.4 and 13.5. There will he no duty to connect any other system if that system were seen by the licensee—not by Her Majesty's Government—to impair the quality of any telecommunications service provided by the licensee.
The licensee shall have no obligation to do anything under that duty, to which I earlier referred in Condition 13.1,
"unless the relevant conditions and terms have been complied with".
The licence goes on to spell out in detail a whole series of conditions, terms and matters that have to be complied with. In other words—I may be quite wrong about this—the old system, whereby the tempo of change lies with the major operators of the public switched telephone network, and may be controlled by them rather than by Government or an independent body, seems to have been paid service to within the conditions of a licence, although if one looks at the Bill without considering the licence, as we have heard today, that is not the case.
Lord Somers: I am sorry to interrupt the noble Lord, but surely it is in the interests of any small system to provide an interconnection because that will greatly increase its use.
Lord Morris: One would certainly have thought so, but practice in the past has not necessarily proved that. Because of the timing, a person wishing to provide a value added service to the existing network may he prepared so to do and ready to do it, but the partner who is needed to supply this service may not he ready, willing or able to provide that service.
With those remarks, I beg to move the amendment standing in my name and in the name of my noble friends.
Lord Mackay of Clashfern: This amendment raises quite an important matter in the way that my noble friend has moved it. Perhaps I could concentrate on one aspect of the matter. As I understand it and the way he has explained it, this amendment would require British Telecom to connect each and every system which was licensed under Clause 7, to take British Telecom as an example. If we were to do this the Secretary of State or the director would have to do one of two things. The first would be to write into all
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the licences for telecommunications systems granted under Clause 7 the rules that would have to be met, if they were to be connected to carry traffic to and from any of the public networks. This would not be right because there is an increasing number of systems which are licensed under Clause 7 but which are not connected to the public network or which serve specialist functions where connection is not wanted. There is no point in having in such telecommunications licences conditions which would make them compatible with connection to the public system. The operators of these systems clearly do not have to meet, and do not want to have to meet, unnecessary and expensive rules.
The second course would he to abandon all standards so that anyone could connect any system to the British Telecom and Mercury networks. I am sure your Lordships appreciate that that would rapidly bring about a reduction in the quality of the public telecommunications service. As a recent Which? report shows, there is wide criticism of the quality of the service which British Telecom provides and the technical advice I have been given is that the connection of systems which do not comply with standards would increase the noise on some circuits, would make many calls inaudible, would cause increasing numbers of calls to fail to get through and would cause many lines and even whole exchanges to appear to be engaged when they were not.
I feel sure that the Government share the same aims as my noble friend in connection with this amendment. We have thought about the issues carefully and we think the best course is to say to British Telecom and to public telecommunications systems' operators that the Government require them to connect other systems but that this requirement should apply only when the other systems are constructed, maintained and operated according to the rules laid down in their licences. The amendment would prevent us from writing the rules into the licences or will require us to apply the rules to all systems licensed under Clause 7; and for the reasons which I have explained this does not appear to be appropriate to achieve the aims which the amendment sets out. I hope that in the light of this explanation my noble friend will feel able to withdraw the amendment.
Lord Morris: I am grateful to my noble and learned friend the Lord Advocate for his explanation. I accept entirely from what he has said that the amendment is highly defective, not only in its position in the Bill but no doubt in its wording as well; but I made it clear at the outset that it was a probing amendment. If, between the two stages of the Bill, he could give me some assurance as to the fears of many with regard to the intent of Her Majesty's Government over encouraging as hard as possible the connection to any licensee's network of value added services and encouraging this position, I would he very much obliged to my noble and learned friend. I beg leave to withdraw—
Lord Torphichen: Before the amendment is withdrawn, may I ask my noble and learned friend the Lord Advocate whether the advice that he has had concerning attachments choking up the system and leaving extensions apparently engaged referred to

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illegal connection and apparatus? Or was the reference to the connection of some legally allowed apparatus and its misuse?
Lord Mackay of Clashfern: I was referring to the technical incompatibility of the one system with the other. The point that I am making is that if you allowed a complete free-for-all you would have a situation where people might attempt to interconnect incompatible systems. On the other hand, if you wanted to permit interconnection you would have to lay down the correct technical standards; but you would not wish to impose these technical standards on systems which do not want to interconnect. The imposition of the standards and the desire to interconnect require themselves to be properly related (I was about to say "connected"). You must relate them properly. That is the point I was seeking to make.
Lord Bruce of Donington: I sincerely hope that the noble and learned Lord will not be in a position to give his noble friend Lord Morris the assurance that he requires. Otherwise, we on this side of the Committee will feel constrained to oppose the amendment.
Lord Morris: I do not think it matters. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.34 p.m.
Lord Mottistone Lord Mottistone moved Amendment No. 75:
Page 10, line 20, leave out ("and") and insert—
("( ) to provide the connections in paragraph (b) above at an interconnection level that is appropriate to the needs of the person or persons in paragraph (d) above and fully automatic where requested and under fair and reasonable contract conditions: and").
The noble Lord said: I have been asked to move this amendment on behalf of the noble Earl, Lord Halsbury. The terms "preference- and "discrimination" in Clause 8(1)(d) are relative to the service provided to others and therefore may not apply in all cases. It has not been unknown (and can easily be imagined) that a monopoly carrier forced by statute to connect a competing system to its own system, might find it more convenient to provide that connection at a lower standard or at a lower grade of service than the competing network requires; or to make the terms and conditions of the connection very unfavourable. In this connection it must be understood that the systems to be connected will range from Mercury at the big end, so to speak, to a small private exchange with only two exchange lines which might not be purchased from British Telecom. The purpose of this amendment is to provide positive protection for the applicant system against a reluctant monopoly if this becomes necessary. I beg to move.
Lord Bruce of Donington: I trust that, when the noble Lord replies to this amendment, he will bear in mind his observations about needs which are incorporated in the amendment and his reaction to needs when it came to consider early amendments to Clause 3 which referred to the needs of people as distinct from the demand.
Lord Mackay of Clashfern: Obviously, I should have regard to what was said before about needs in what I am now going to say. So far as this amendment is concerned, and as my noble friend has explained the amendment, the Government share my noble friend's objectives. I would wish to explain briefly how we intend to achieve them. The Government have already set out their policy on high-level interconnect. Condition 13 of the draft British Telecommunications licence lays down the principles on which the Government intend interconnect to take place. Our aims were underlined on 17th November 1983, when my right honourable friend the Minister of State for Industry and Information Technology said in another place:
"We intend any person connected to any public telecommunications system to be able to call any person connected to any other public telecommunications system. That is our firm aim."
I should like your Lordships to be in no doubt that we intend not only to achieve this but also to achieve it as soon as this Bill is enacted and gives us the necessary powers.
I should also say that much has already been achieved on the road to interconnection. Your Lordships will know that there is a full automatic dialled connection between British Telecom and the Hull system and between British Telecom and the host of private branch systems in offices and factories throughout the country. There is also a low level of interconnection between British Telecom and the Mercury system: but I would ask your Lordships to excuse me from dealing with the detail of this subject because of the present pending litigation. Air Call has also secured arrangements for the automatic connection of its radio paging system to British Telecom. Arrangements for the automatic interconnection of its radio message handling system with British Telecom are being delayed by the lack of agreed technical arrangements for such interconnect and by lack of agreement on charging protocols et cetera. But the principle of automatic dialled interconnect between private mobile radios and the British Telecom systems is, I understand, accepted by all concerned.
We have drafted this Bill not only to ensure that dialled high-level interconnect does take place but also to ensure that the Secretary of State and the director have no alternative but to use their licensing enforcement powers to achieve this objective. This is achieved, we believe, by Clauses 3, 4 and 7 as drafted. Clause 3(1)(a) lays down that it is the duty of the Secretary of State and the director to exercise their functions in the manner they think best calculated to secure that there are provided such telecommunication services as satisfy all reasonable demands. There can be no doubt that there is a demand for the type of interconnection I have just described, which means that the Secretary of State and the director will be obliged to exercise their functions to secure the provision of that interconnection, subject only to the limitation of what is practicable and whether their actions may damage the viability of those who provide telecommunication services generally. The Secretary of State proposes to use the powers conferred on him under Clause 7 to include

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what is now draft Condition 13 in the British Telecom licence.
I should like to say in conclusion that the Government do not feel it appropriate to refer to interconnection levels in the Bill. These concepts are apt to be ill-defined and relate to the existing analogue technology. I am advised that digital technology will radically alter the position and will probably render obsolete the existing concept of levels. Having said this and sought to explain the Government's commitment in the matter, I hope that the noble Lord will feel able to withdraw his amendment.
Lord Mottistone: I thank my noble friend for that very full reply. I shall read it carefully, and in the meantime I beg leave to withdraw the amendment.
Lord McIntosh of Haringey: Before your Lordships give leave for the amendment to be withdrawn, apologise for intervening at this stage but I had not realised that it would be withdrawn so rapidly. When I come to read the reply of the noble and learned Lord, I hope it will not be as favourable to the noble Lord, Lord Mottistone, as the noble Lord seems to think. This is a much more serious matter than would appear from the technicalities of levels of communication. This is not the case of one telecommunications operator dealing with another on equal terms. It is a question of the way in which British Telecom deals with other licence holders, and they are by no means on equal terms.
In one sense it might he thought that the power of BT is very great under the provisions of this Bill, and I agree that is the case; but if the Government go too far along the roads being so seductively proposed by the noble Lord, Lord Mottistone, and his noble friends, the possibility is that BT will land up with all the obligations and the other operators will land up with all the advantages. That is a serious possibility if we go too far towards this amendment. There is a possibility that if British Telecom no longer has the power to control the method by which other operators connect with its own system it will be left providing the basic and not necessarily profitable system, which includes the obligation to supply residential households, for example, and the other operators will simply come in at whatever level they choose and skim offall the cream. That, as I say, is a serious possibility, as I am sure the noble Lord, Lord Mottistone, knows. Indeed, I am sure it is in his mind in moving the amendment, but it is one which will have to be resisted by the Government, and if there is any move in that direction we shall have to take a part in resisting it.
Lord Mottistone: The whole point is to get this fair. You have one vast company and a lot of little ones. Our amendment is intended to try to tip the balance not all the way but part of the way towards the smaller companies so that they have a fair and equal chance. I quite understand what the noble Lord, Lord McIntosh, has to say: he has said it many times before on other amendments. Of course this is serious, and no doubt he will say the same thing again. But the fact is that British Telecom does not really need to be cossetted: it needs to be controlled. That is where the difference lies between us: but do not let us go on and
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on with that argument. I again beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
6.44 p.m.
Viscount Trenchard Viscount Trenchard moved Amendment No. 75ZA:
Page 10, line 28, at end insert—
(";and
to maintain accounting records in such a form, that the activities of the licensee which are of a similar nature to activities of other licensees, whether particular person or class of persons, to whom licences have been granted under section 7 above, are separately identifiable or separately attributable in the books of the licensee. Provided that this condition shall only apply if the licensee is in a monopoly situation; and for the purposes of this paragraph, a monopoly situation shall he as defined by sections 6 and 7 of the Fair Trading Act 1973.").
The noble Viscount said: I tabled this amendment of course before I heard the helpful statement from my noble friend in relation to Parliament's at least getting a look at the licence. I realised that to require in a Bill a form of accounting in an individual company, albeit in the accounts of a company in a very monopolistic position, was a rather exceptional thing to do. I had also taken note of Condition No. 20 in the draft licence, which requires a degree of separation of British Telecom's accounts and, indeed, businesses. But what I felt was that it did not cover the number and kind of separations that certainly a director of Oftel, I believe, would wish to see if he is to discharge his duties in ensuring fair competition. I therefore put down this amendment in the terms of maintaining accounts in a form which are of a similar nature to activities of other licensees. I had in mind not only the various parts of the networks, national and regional, and not only apparatus (which is covered in Condition 20) and the manufacture of apparatus, but the international area and, even more particularly, the value added services, which are not mentioned.
I am aware that the value of splitting accounts, when a number of overheads are arbitrarily allocated to the distinct trading operations, remains an arbitrary judgment. It is one that has to be made in the management of many large private and public enterprises. It cannot be done perfectly but it can be a big help to British Telecom itself in the management of its enterprise, and I think that is important. During Second Reading we heard certain reports on the state of accounting in British Telecom at the moment. I have already said that I think it would be a great help to the director and to Oftel. I feel that it could even be a help in relation to the flotation of British Telecom, because would-be investors are bound to want to be able to see an estimate at least of the results of each section of this huge business.
So, for all those reasons, I tabled this amendment. I have been reflecting since my noble friend made his very helpful statement in relation to the licence as a whole whether it would he adequate, and whether my noble friends would regard it as adequate, simply to request that he asks the Secretary of State, before the licence is finalised, to consider whether we have enough separation in the conditions in the licence and in particular in Condition 20, and whether it would not be appropriate to push for substantially more.
I am also aware that there are later amendments which bear on this question in relation to some parts

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of the industry, but it is particularly the value added services that I feel British Telecom should be required to show a trading account for, even though it is on an arbitrary basis. I beg to move.
Lord Bruce of Donington: I read through this amendment with some amazement. Your Lordships will observe that in the last four lines of the amendment it says:
"Provided that this condition shall only apply if the licensee is in a monopoly situation: and for the purposes of this paragraph, a monopoly situation shall he as defined by sections 6 and 7 of the Fair Trading Act 1973".
The noble Viscount knows perfectly well that British Telecom will be in a private monopoly situation more or less indefinitely, unless of course the noble Viscount repudiates the undertaking given by the Prime Minister, to which I referred earlier on in the Committee stage when he may not have been there. If the noble Viscount will allow me to complete the point I am making I shall be happy to give way to him, The only competitor, according to the Prime Minister, who impinges in any way on the position of British Telecom for the foreseeable future—and I am relying upon the Prime Minister and not upon the noble Viscount—will he Mercury. That means, for all practical purposes, that this amendment is designed to ensure that the accounting records of British Telecom—I will quote the amendment and then I will give way to the noble Viscount—will be in such a form,
"that the activities of the licensee"—
and they are the only effective licensee—
"which are of a similar nature to activities of other licensees,"
which in this case is Mercury,
"whether particular person or class of persons, to whom licences have been granted under section 7 above, are separately indentifiable or separately attributable in the books of the licensee."
What does that really mean? The noble Viscount knows perfectly well that the accounts of British Telecom are presented by one of the most reputable firms of chartered accountants in the United Kingdom. The accounts are very easily understood. Why does the noble Viscount want further information of a character comparable to that of Mercury to he supplied by British Telecom? Why can he not put it the other way and require the accounts of Mercury to conform to the standards of British Telecom?
Viscount Trenchard: I thank the noble Lord for giving way. The competition in the basic network is, as he described it, Mercury only. The competition in apparatus, in value added services and probably in international services is quite different. The problem is as the noble Lord stated it—and I am only amazed at his amazement—namely, that British Telecom will be in an enormously strong monopolistic position for a long while to come in the basic network. It is also involved in the other areas where large numbers of firms, big and small, are also involved. Unless it separates its accounts for its businesses properly, it will be extremely hard for the director of Oftel to ensure what is and what is not a fair or unfair competitive position outside the basic network operation. It is in the interests of British Telecom itself that it should be
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able to justify before Oftel its pricing in these other areas. It is therefore to its advantage to be able to separate these accounts. I hope that I have satisfied the noble Lord's mind.
Lord Bruce of Donington: Yes, the noble Viscount does, in part, satisfy my mind. All I can say, as one who has had some experience in the preparation and presentation of accounts, is that I sincerely hope that the accounts of the other licensees to whom he referred are of the same high standard as those published by British Telecom.
Viscount Trenchard: The reason why I would not concern Parliament with that point is that it is not in a very strong monopolistic position. In many cases, it will have extreme difficulty in being able to get fair competition.
Lord Bruce of Donington: But is the noble Viscount aware that the auditors of British Telecom are entrusted with a very considerable responsibility? Is the noble Viscount suggesting that the accounts as audited by an extremely renowned firm of auditors, whoever they may be—I think that the present ones are probably likely to continue—will do anything other than present a true and fair view of the affairs of British Telecom as required by the Companies Act?
6.54 p.m.
Viscount Trenchard: So far as I can remember, it is not a condition of any Companies Act that accounts be kept for certain separated parts of the business. So I am not impugning any auditor about anything. I am merely pointing out that this very large public monopoly in one area of the telecommunications world will continue, as the noble Lord himself said, to be a near monopoly in a private sense, and that in that situation it is very difficult, even by accident, not to price unfairly a small section of your business which is completely lost in the total acounts of this huge enterprise. It is also extremely hard, even if you try not to do so, to avoid conditional selling.
We are speaking to an amendment on the Bill and the last thing I want to do is encourage the noble Lord to go a back to a Second Reading speech criticising the Bill as a whole. For his information, I have some sympathy with some of his criticisms, but in the Bill as written I believe that it would be an improvement, and a help to a lot of companies whom we want to see expand in this area, if the British Telecom accounts were split in the way I have mentioned, particularly in areas which are not of the main network.
Lord Bruce of Donington: I am most grateful. Would the noble Viscount, being a very fair-minded person—as I am sure from my own personal experience of him he is—support an equal insistence that Mercury, which will also be one of the licensees for a long time, shall show the precise advantage that it obtains in financial terms, so far as that is ascertainable, in battening like a leech on the whole system as established by British Telecom?
Viscount Trenchard: I must not detain the Committee but I would not suggest making that a

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statutory provision unless and until it had reached the strength of a monopoly position in any important part of this field. There would be the question of good management and advice, which I think the noble Lord may wish to give Mercury on how to run its accounts. But, in terms of possible abuse, I do not see the necessity for legislation until such time as a monopoly has been reached.
Lord Taylor of Gryfe: I wonder whether it is necessary to build this into the Bill. We are talking about the procedures to be carried out by a public limited company which will have a board of directors who will represent the interests of shareholders. The point that is being made, which relates to some subsequent amendments, is that there is a great danger of this company exercising that monopoly purchasing power by supporting its own additional production capacity—be it telephone instruments or whatever —and because it has a monopoly power it will be able to concentrate on purchasing within its own business, to the exclusion of other competitors.
But I should imagine that, in any company which has a subsidiary undertaking within its business and which is tempted to do some cross-subsidation, as suggested by the noble Viscount, it is not in the interests of the company, nor of the shareholders, to maintain a production unit, even if it is exercising its monopoly power, that is not producing as efficiently or as attractively as a competitor. I should have not have thought it was necessary to put this into the statute. With the protections that we have from the Office of Fair Trading against the abuse of a monopoly, I think that we have adequate protection against the kind of abuse that the noble Viscount has in mind.
Lord Mackay of Clashfern: From my noble friend's introduction, I took it that he was finding the situation a little different from what it was when the amendment was put down, in respect of what my noble friend Lord Cockfield said earlier about the chance to look at the licence before the public telecommunications system was licensed—
Viscount Trenchard: If it helps my noble and learned friend, perhaps I can speed things up and make up for a little of the time that the noble Lord, Lord Bruce, and I have used. If he were able to assure me that he would draw to the Secretary of State's attention this exchange today, and ask whether there is a possibility of the conditions in the licence—Condition No. 20 in particular—being drawn slightly differently to include the value added services, I should be prepared to withdraw the amendment today and wait upon his reply as to whether it is possible.
Lord Mackay of Clashfern: I am greatly obliged to my noble friend. I shall be very happy to draw to the attention of my right honourable friend the Secretary of State all that has been said in this exchange. There are a number of conditions in the draft licence which bear on this problem, apart from Condition 20.
Viscount Trenchard: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 75A:
Page 10, line 36, leave out from ("shall") to ("notice") in line 37 and insert ("give").
The noble and learned Lord said: I beg to move Amendment No. 75A, and with leave I shall speak to Amendments Nos. 78A, 81A, 96C, 98A, 99A, 99D, 99K and 99M.
Amendment No. 78A: Page 10, line 47, at end insert—
("( ) A notice under subsection (3) above shall be given by publication in such mariner as the Secretary of State or the Director considers appropriate for bringing the matters to which the notice relates to the attention of persons likely to be affected by them.").
Amendment No. 81A: Clause 10, page 13, line 7, leave out from ("matters") to end of line 17 and insert ("to which the notice relates to the attention of persons likely to he affected by them").
Amendment No. 96C: Clause 12, page 14, line 33, after ("appropriate") insert ("for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them").
Amendment No. 98A: Clause 13, page 16, line 6, after ("appropriate") insert ("for the purpose of bringing the reference or variation to the attention of persons likely to be affected by it").
Amendment No. 99A: Clause 15, page 19, line 17, after ("appropriate") insert ("for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them").
Amendment No. 99D: page 20, line 18, after ("appropriate") insert ("for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them").
Amendment No. 99K: page 21, line 40, after ("appropriate") insert ("for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them").
Amendment No. 99M: page 22, line 5, leave out from ("or") to ("and") in line 7 and insert ("persons likely to be affected by it").
These amendments are intended to introduce a minor improvement into the various requirements for the publication of notices under Part II of the Bill and, in so doing, to introduce consistency between the different provisions. It has always been the intention that, when licences are issued which contain conditions of the kind envisaged in Clause 8(1), when the Secretary of State is considering whether or not to apply the powers of the telecommunications code to a particular operator and when the Director General of Telecommunications proposes either licence modifications or the enforcement of particular licence conditions, there should be an opportunity for those likely to be affected by the outcome to be able to make representations.
It has been pointed out that, as drafted, some of the requirements to publish do not make it absolutely clear that publication will be in a manner appropriate for the purpose of bringing the relevant matters to the attention of those likely to be affected. We think it right therefore to bring forward these amendments. They introduce consistency between the various notification provisions; and, more important, they remove any doubt about the manner in which notices will be published. I hope that your Lordships will agree to support these modest improvements. I beg to move.
Lord McIntosh of Haringey: We entirely support the amendments.
On Question, amendment agreed to.
Lord Denham: This is probably the moment when we should have the adjournment. I am not sure how long the intervening business will take, but for the sake of those noble Lords who are interested in the Committee stage of the Telecommunications Bill may I say that we shall not resume the Committee stage before a quarter to eight. I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Town and Country Planning Bill
7.4 p.m.
Report received.
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 1:
After Clause 1, insert the following clause:
("Tree preservation orders in antiopation of disposal of Crown land.
.—(1) A local planning authority or, in Scotland, a planning authority may make a tree preservation order in respect of Crown land in which no interest is for the time being held otherwise than by or on behalf of the Crown if they consider it expedient to do so for the purpose of preserving trees or woodlands on the land in the event of its ceasing to be Crown land or becoming subject to a private interest.
(2) No tree preservation order shall be made by virtue of this section except with the consent of the appropriate authority.
(3) A tree preservation order made by virtue of this section shall not take effect until the land in question ceases to he Crown land or becomes subject to a private interest, whichever first occurs.
(4) A tree preservation order made by virtue of this section shall not require confirmation under section 60 of the Act of 1971 or section 58 of the Act of 1972 until after the occurrence of the event by virtue of which it takes effect in accordance with subsection (3) above; and any such order shall by virtue of this subsection continue in force until—

(a) the expiration of the period of six months beginning with the occurrence of that event; or

(b) the date on which the order is confirmed, whichever first Occurs.

(5) On the occurrence of any event by virtue of which a tree preservation order takes effect in accordance with subsection (3) above the appropriate authority shall as soon as practicable give to the authority that made the order a notice in writing of the name and address of the person who has become entitled to the land in question or to a private interest in it; and the procedure prescribed under the provisions mentioned in subsection (4) above in connection with the confirmation of the order shall apply as if the order had been made on the date on which that notice is received by the authority.
(6) In section 58(4) of the Act of 1972 after the words "section 59 of this Act" there shall he inserted the words "and section (Tree preservation orders in anticipation of disposal of Crown land) of the Town and Country Planning Act 1984".
(7) Any order made before the date on which this section comes into force which would have been a valid tree preservation order but for the fact that—

(a) the land in respect of which it was made was Crown land; and

(b) no interest in the land was for the time being held otherwise than by or on behalf of the Crown,

shall be deemed to have been a valid tree preservation order: but any order validated by this subsection shall have effect (and be deemed always to have had effect) as provided in subsection (3) above.").
The noble Lord said: My Lords, this new clause arises from a suggestion made in another place that the provisions of the Bill should be extended to tree preservation orders. It was recognised from the outset
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that this was a valuable and sensible suggestion for improving the Bill. However, its implementation has not been easy and that is why I must apologise for bringing this new clause before your Lordships at such short notice.
At present, tree preservation orders cannot be made in respect of Crown land in which there is no subsisting private interest. We have heard quite a lot about "subsisting private interest" during the course of our discussions on the Bill. However, the need for the clause arises from what happens when Crown land upon which trees are growing is sold or let. If the local planning authority concerned considers that the trees ought to be preserved, it can make a tree preservation order as soon as the land ceases to be Crown land or a private interest in it is created. But even the speedy procedure for making a provisional tree preservation order which the 1971 Act contains takes a few days. A tree, though, can be cut down in a few minutes, so there is inevitably a period when the trees are at risk.
The new clause would enable a planning authority to make a tree preservation order in respect of Crown land in which there is no subsisting private interest. However, the order will not take effect until the land has been sold or a private interest in it, such as a lease, has been created. Even then, it will take effect only provisionally and it will require to he confirmed within six months of the sale or creation of the private interest that brings it into effect. In this way, the short-term protection of the trees is ensured, but the new owner of the land will have the normal opportunity to have his views properly considered before the order takes permanent effect.
The clause covers two other points. First, we recognise that the provisions of Section 266 of the 1971 Act may sometimes have been misunderstood. We believe that some tree preservation orders may erroneously have been made in respect of Crown land in which there is no subsisting private interest, just as we know that planning permissions have erroneously been granted in these circumstances. Subsection (7) would therefore validate such orders so that they take effect as if they were orders made under this new clause. Secondly, it should be noted that subsection (6) of the clause applies only to Scotland, where the statutory powers relating to tree preservation orders differ from those in England and Wales. The purpose of subsection (6) is to ensure that a tree preservation order made under the clause is recorded in the Register of Sasines after it is confirmed. I hope that your Lordships will share my view that these are useful new powers. I beg to move.
Lord Graham of Edmonton: My Lords, on behalf of the Opposition I arise with alacrity to express our appreciation of the terms of the new clause and of the spirit in which the Minister in another place. Mr. Neil Macfarlane, was quick to recognise the point that was made to him by the Member for Chipping Barnet, Mr. Sydney Chapman. Mr. Sydney Chapman, to my knowledge, has always been very diligent, fair, robust and independent in his point of view. He is certainly a very knowledgeable Member of another place on these matters. He made his point not merely because he is knowledgeable about town and country planning matters but because he has assumed the responsibility

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of president of a certain body. However, it surprises me that it was left to a Back-Bencher to point out this deficiency in the Bill.
The history of this matter is not a happy one. Indeed, it is somewhat sad. We on this side of the House acknowledge the Government's immediate recognition of the deficiency and the way in which they have put it right by means of this new clause. There can be few matters in planning legislation which arouse more anger and apprehension in the country generally than the protection of trees. As was pointed out in another place, we are talking in terms of 50,000 acres of land owned by these bodies. The Member for Chipping Barnet may well have had in mind interests which both he and I share. As his constituency includes the Friern Barnet mental hospital, he must know, as I do, that it is intended that by 1993 this very large area of land, upon which there are many hundreds of trees, should pass from Crown to private ownership. Therefore, he has every right to be concerned.
The Government must recognise that the protection and preservation of trees can have enormous financial consequences if there is any possibility of land passing into private ownership without the tree preservation order being watertight. I was interested to hear the Minister point out that even under the emergency powers which are contained in the 1971 Act it is possible for these matters to take a few days. We are well aware of the situation where a tree which is crucial to the amenity of an area and which has a preservation order attached to it is suddenly lopped or cut down. People are very good at saying that they are sorry—that the notice had not arrived. I want the Minister—and it is purely a point across the Table—to take fully on board that it would be an absolute travesty if, when land was passing from Crown ownership to private ownership, there was a timescale which allowed the protection and conservation of the amenity to be put at risk.
I recognise of course that the best people to understand the need for protection are the local authority. If the local authority cannot act until the ownership has changed—and I note the words "until the land in question ceases to be Crown land or becomes subject to a private interest, whichever first occurs" (I may be wrong, and I can certainly take advice, but surely they happen simultaneously)—well, therefore there is an interregnum, there is a no man's land. There is a time in which mischief can be done.
If there is a time when it is neither one nor the other, and that is, by virtue of bureaucracy or administration, a period in which some damage can be done, then the House ought to ask the Government to look very closely at the situation. If it means that a local planning authority, the council, cannot act—and I appreciate they can only make the order with the agreement of the regional health authority, or the Post Office or whatever it is—I would have thought that one ought to look very closely at what might be called an overlap period. If there is a desire on the part of the Crown landowner to protect the trees, if the local authority, on behalf of the community, is expressing a desire that the trees be protected, and there is a period in which some damage can be done, can the Minister and his advisers look at the possibility of the tree
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preservation order either being made in advance or with a date of operation which applies immediately the ownership changes from one to the other? I certainly am very concerned about that point.
Then we come to subsection (4). That is, "(a) the expiration of the period of six months beginning with the occurrence of that event"; or "(b) the date on which the order is confirmed". Can we take it that this in effect is the stopgap period while the ownership is changing? If the order is capable of becoming permanent—in other words, the order once made and subsequently confirmed is as permanent as one can have in planning legislation—then I am satisfied. But if it means that the local authority is simply going to ask for the holding period of six months and then has to go through the process again, then I fear for the possibilities. The Minister is well aware of some unhappy experiences that he and I know where Crown land changes into private ownership. We are talking about considerable sums of money that can be made; we are talking about land which is worth a lot more money with no trees on it than land upon which there are trees which are preserved.
So with those few words of welcome—and I ask the Minister to understand them as words of welcome, and of appreciation to him—we on this side of the House feel that the Government have been wise in recognising the anxieties expressed in another place and fully shared in this place too.
Lord Skelmersdale: My Lords, it is obviously not my night; I have obviously made such a hash of explaining this amendment that the noble Lord, Lord Graham, did not really get the drift of what I was trying to say. The purpose of the clause is that it enables a tree preservation order to be made when the land is still Crown land. It is a sort of subliminal interest, if you like. It only takes effect as soon as the land is sold or the private interest is created. The new owner or lessor may, very naturally, want to object, and he has this six months which the noble Lord asked about in which to do that. After that time the order would be confirmed or not, depending upon whether his objection is upheld. I hope that now explains the position to the noble Lord.
Lord Graham of Edmonton: My Lords, I am grateful to the noble Lord. In order that I may be quite clear as to the timescale, suppose a Crown owning authority decides to dispose of land in a way which enables it to seek from the local planning authority the kind of planning permission that that local authority would give, on the basis that at the present time the land is hospital land and the intention is to maximise the value of the land to the public—as opposed to the private developer, speculator, owner; nothing derogatory is intended—and in order to make sure that the land changes hands not at £2,000 or £3,000 pounds an acre but at £70,000 or £80,000 an acre, if it is for housing in order to protect some of the trees one needs to give to the local authority the discretion not to make a blanket order. If we are talking in terms of the land changing ownership—shall we say?—on 1st July, am I right in thinking that the Minister is saying that the tree preservation order shall be applied for and shall come into effect on 1st July but shall be in

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existence before 1st July, so that it is as watertight as possible, and so that when the ownership changes the chopper comes down and the order shall be in existence?
Lord Skelmersdale: Yes, my Lords. In fact the chopper comes down even more quickly than that. The moment the transfer is signed between the Crown and the purchaser, at that very moment, the tree preservation order comes into effect. So there is absolutely no gap at all.
On Question, amendment agreed to.
Clause 3 [Persons in occupation of land by virtue of a licence or contract]:
Lord Skelmersdale Lord Skelmersdale moved Amendments Nos. 2 and 3:
Page 5, line 3, leave out ("and 2") and insert (", (Tree preservation orders in anticipation of disposal of Crown land) and 2").
Page 5, line 6, leave out ("section 2") and insert ("sections (Tree preservation orders in anticipation of disposal of Crown land) and 2").
The noble Lord said: My Lords, Amendments Nos. 2 and 3 are consequential upon the amendment which your Lordships have just agreed. I beg to move the two amendments en bloc.
On Question, amendments agreed to.
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 4:
Page 5, line 14, leave out ("granted by an instrument").
The noble Lord said: My Lords, this is a drafting amendment to secure consistency with subsection (1) of Clause 3. I beg to move.
On Question, amendment agreed to.

Inshore Fishing (Scotland) Bill [H.L.]
7.19 p.m.
Read a third time.
Clause 1 [General power to prohibit sea fishing in specified areas]:
Lord Ross of Marnock Lord Ross of Marnock moved the following amendment:
Page 2, line 8, at end insert—
("( ) Before making any orders under this section the Secretary of State shall consult such bodies representing inshore fishing interests as appear to him to be appropriate.").
The noble Lord said: My Lords, I move this amendment hoping to meet the wishes of the Government. As I remember, at the last stage an amendment creating some form of consultative committee was put forward by myself, and it was only turned down very reluctantly. I felt, by the Minister of State, because he thought that it went fairly wide and was not exactly in the right words. He said he almost wished there was some power in respect of an advisory committee. He later went on to say that he did not quite mean that, that it was something else, but he was going to have an advisory committee.
The point is that here we are giving the Secretary of State very considerable blanket powers over the industry, both in respect of what may be local problems and in respect of what may be national problems. All the Secretary of State has to do is make an order to prohibit or ban fishing in areas which are wide, or not so wide, or to except certain kinds of fishing, Indeed, he has a general power of exception from any power that he seeks to exercise. All this he can do without consulting anyone. He is unfettered and untrammelled. He can just act on whatever strange advice he gets, perhaps from his officials, or he may even have had a nightmare, and can proceed to a regulation. That is as the statute stands. He is under no obligation to consult anyone.
It is no good the Minister saying that the Secretary of State will consult. According to the statute the Secretary of State does not need to consult. I remember legislation that we have had in the past week about tourism. The Secretary of State has to consult, not people in Scotland but people in England. I noticed that recently there was a Bill about education concerning, I think, grants and awards. Lo and behold there was a whole paragraph about consultation! Surely, when one is dealing with what may be the livelihood of very worthy people round the coast of Scotland—people who are very touchy indeed about central government interfering with things that they could settle themselves, and certainly on which they have a point of view—we really ought to include a paragraph saying that before any of these regulations are laid or come into force the Secretary of State should consult the appropriate fishing interests.
I cannot answer for the impeccability of the draftsmanship, but the Minister might like to know that I lifted the clause completely from a Government Bill that was going through the House last week. I think it will meet the needs of the industry and the innermost wishes of the Minister of State that we should put in this power that:
"Before making any orders under this section the Secretary of State shall consult such bodies representing inshore fishing interests as appear to him to be appropriate".
That gives him full legal coverage, and he need only consult those interests that he thinks are important. I could not have done better myself in drawing up a way to protect the Secretary of State from the legal consequences of what he might do. I beg to move.
Lord Grimond: My Lords, I hope that the Government will consider this amendment favourably. As the noble Lord, Lord Ross of Marnock, said, it may not be perfectly drafted. I would have drafted it a little wider and extended the scope of consultation to other bodies besides the inshore fishing industry, if there are bodies representing other elements of the fishing industry. I think they could be consulted, too. But that is a minor matter.
The point is that from the very beginning I have felt that the necessity for this Bill is doubtful. I believe agreement could have been reached between the various fishing interests. They have shown no great enthusiasm for the Bill, but it is absolutely essential that the Government should carry them along with it. It could well be disastrous if the Government begin making orders which set the static fishermen against

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the inshore fishermen. The Government may say, "Of course we shall not do that. We are eminently sensible men", and so on. But they have been known to rush prematurely into such things. I cannot see that they will lose anything by accepting a clause of this nature. After all, if consultation is with only such interests as appear to the Secretary of State to be appropriate it gives him extremely wide tolerance on what bodies he is likely to consult.
It may be said that the whole thing is subject to statutory procedure in Parliament. But we all know what that means. Candidly, it may receive extremely little consideration. Local fishing industries may suddenly find that an order has been made before they wake up to what is happening. As I understand it, no time is laid down. It is simply the time that the procedure takes to go through Parliament. We are talking about small groups of men round the coast who are not in daily touch with the Scottish Office and who may well find that they are faced with an order before they understand what is happening.
Therefore, I hope that the Government will accept the amendment. It is a reasonable amendment. Everything put forward by the noble Lord, Lord Ross of Marnock, is always reasonable. He is notorious for his goodwill and for his anxiety to please. In this case he has gone out of his way to make this an amendment which the Government can accept.
In all seriousness, I cannot see what the Government will lose by accepting the amendment. It will reassure the industry, which is worried in case it is forced into a position which it does not want, if the Government are not going to move without consultation. I do not believe it is enough for the Government to say, "Of course we shall consult". If that is the case, there is no reason for not writing it into the Bill.
The Minister of State, Scottish Office (Lord Gray of Contin): My Lords, the noble Lord, Lord Ross of Marnock, is to be congratulated on his efforts to protect the interests of the fishing industry. Indeed, I am just afraid that if we accept the amendment the fishermen will not in every case benefit to the extent that he intends. I also note the support given to the amendment by the noble Lord, Lord Grimond. I know that it is his intention also that the industry should be protected and assisted in every possible way. However, I can assure the noble Lord that we have the interests of the industry equally at heart.
The Secretary of State has amply demonstrated his good faith in the consultation process in the legislation which has already been enacted and in the dealings which he has had with the fishing industry. In Committee I gave a number of examples of the close relationship which has built up between the Government and the fishing industry—a relationship which has developed over the years and as a result of which extremely difficult and sensitive negotiations with the European Community reached a successful conclusion. These were not negotiations and consultations with the industry which were achieved by means of statute: they were consultations which took place on a totally voluntary basis, to which both parties gave a great deal and listened a great deal, and then acted upon the result of their deliberations.
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Noble Lords may say, "If negotiation is so easy and if the Government are in favour of advisory committees, why should it not be necessary for the Secretary of State to consult them, and why not write this into the legislation?" There are perfectly good reasons why it is better that it should not be written into the legislation. For example, as far as the fishing industry is concerned the question of the spirit of this amendment is not one to which I take exception. I accept the spirit; but we are arguing about whether it is better to try to achieve the best means of consultation by means of trust between advisory groups of people, advisory committees, and the Government, or whether we want to write it into statute.
I believe that one of the difficulties is that sometimes time is of very great importance. It could be that there is a dispute, for example, between two fishing interests; let us say between the mobile gear fishermen and the static gear fishermen. It might be necessary for the Secretary of State, in the best interests of everybody concerned, to close a particular area. If by statute he is required to consult, that cannot be done immediately. I think that at Committee stage the noble Lord, Lord Ross of Marnock, suggested that there could be consultation by telephone, but that is not always possible. More people than might be available on the telephone may need to be consulted; some might not be available by telephone. It might be necessary to convene a meeting. All this takes time. In the meantime, the Secretary of State would be unable to act because it had been written into statute that he has first to consult.
I think that there is little between us as to what we aim to achieve. The difference is that we believe that it is better to achieve the result by means of consultation with advisory committees on a purely voluntary basis, whereas the noble Lord, Lord Ross of Marnock, is suggesting that the requirement should be written into statute. For that reason, I cannot accept his amendment and I hope that he might consider withdrawing it.
7.31 p.m.
Lord Ross of Marnock: My Lords, I like the spirit of the Minister of State. He says that all governments have been good over consultation. I could tell him quite a lot of things about the failure of governments to consult, or to consult the right people. The amendment suggests no formalisation. It just says that the Secretary of State has to consult. It does not say that there will be a standing or advisory committee on any particular problem. It may require a different set of people. It just says the people who are appropriate in respect of the particular regulation.
The Minister cannot have it both ways. He cannot say that there is no time for consultation and at the same time that the Secretary of State might prefer to consult in a particular way. If there is no time for consultation, nobody will be consulted and the Secretary of State will act without advice—which is a very foolish thing for a Secretary of State to do. How many times does that arise? The last time the Minister covered himself by talking about an emergency. Quite frankly, emergencies do not arise. An emergency to the Scottish Office is something that has been hanging

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fire for at least five years. I can rememnber that I was sent a paper by officials and they wanted a decision within two days, but they had been sitting on it for five months. Probably the emergency exists only in the minds of the officials. If the business is carried on properly, there is plenty of time to consult. I am not satisfied that that is a very good excuse.
I think that if the Minister asked the industry he would be told that it would prefer to have this provision. The Minister talks about matters in relation to negotiations with the EEC. The Secretary of State would have been a foolish man if he had not been in touch with the fishing industry, because it was watching every single move not just by this Government but by other governments; and it is still watching. It is not yet entirely satisfied in relation to quotas.
The provision is written into the Bill that the Secretary of State has to consult the British Tourist authority. Again, we know that he would do that anyway. Last week we dealt with legislation on education which said that the Secretary of State must consult in respect of something or other. That is where the words came from.
I took note of the point made by the noble Lord. Lord Grimond. I think that he is right. I hesitated over whether to use the term "fishing industry". I thought that I had better narrow it as it is an inshore fishing Bill. But if there is consultation going on outside, the Secretary of State can consult any other interests without a mandatory requirement.
I think that this is an amendment that the Government cannot afford to pass up. They will probably hear about it elsewhere. I hope that they will. There is so much timidity about the Government at the present time that I begin to despair. I know that the Minister of State is new to the Scottish Office. He was a private secretary or a Whip there at one time, I believe. He should know a little more about it than to talk about failing to exercise the power that he has. He does not need a regulation before he can exercise his power. All he has to do is to get up and say "Yes", and to tell the Secretary of State that a whole crowded House insisted that this amendment be accepted.
Lord Grimond: My Lords, I do not know whether I am in order in saying one word in view of what the Minister has said.
Lord Ross of Marnock: My Lords, the noble Lord is in order as long as I have not sat down.
Lord Grimond: My Lords, the noble Lord has not sat down and I am very glad to hear it. I am much obliged to the noble Lord for not sitting down. May I then put this point to him? Not only is he quite right, of course, about the emergency, but does he not think it a little alarming that the Minister particularly referred to a dispute and said that the Secretary of State might have to act very quickly because of a dispute? I accept the noble Lord's view that it is very unlikely that he would have to act very quickly in any degree; but I thought that the Minister's argument was
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going to be that certain of the orders were so obvious and so widely accepted that it was unnecessary to consult. But a dispute is exactly the time when he should consult. If he is going to override a genuine dispute between two sections of the industry without consulting either, then I really think that they have some reason to be nervous about this Bill.
Lord Ross of Marnock: I am grateful to the noble Lord for that intervention. It was a point that I had thought of but I did not feel that I should prolong what I was saying. I have only one thing more I want to ask about. I have asked the question more than once. What is the nature of the statutory instrument by which the Secretary of State is to exercise these powers? Will Parliament see it at all? Will it have a chance to debate it either on an affirmative or a negative Motion? We should have had an answer to this a long time ago. I suggest that Parliament will not see the orders again. If Parliament is not to see them again, it is all the more important, surely, that the fishermen should see them and give the proper advice at the right time. Everything builds up to the importance of the Government doing this kind of thing.
Lord Gray of Contin: My Lords, I am grateful to the noble Lord, Lord Ross of Marnock, for keeping going long enough for me to get the little message that comes on these occasions. The order is seen by the joint committee. I apologise: before I began to speak again, I should have said, "By leave of the House".
The consultation takes place considerably before that. Indeed, as I explained, considerable consultation has already taken place about the location of static gear and nursery areas. The proposal which the Government have put forward is by no means final. It can he changed in accordance with the wishes of those who are involved locally. It is the desire of the Government that there be consultation if changes are to be made at any future time. That is the answer to the noble Lord's question.
I am afraid that I still do not accept the arguments which the noble Lord has put forward. I believe that what we are doing is better for the industry than what the noble Lords. Lord Ross of Marnock and Lord Grimond, wish us to do. For that reason, with regret, I am unable to accept the amendment.
Lord Ross of Marnock: My Lords, despite the fact that in this whole crowded House nobody has supported the noble Lord, and the fact that he now tells us that Parliament will not see the orders again, I shall withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Gray of Contin: My Lords, I beg to move that the Bill do now pass.
Moved, That the Bill do now pass.—(Lord Gray of Contin.)
On Question, Bill passed, and sent to the Commons.

Orkney Islands Council Order Confirmation Bill
Considered on Report.
Lord Skelmersdale: My Lords, I beg to move that the House do now adjourn during pleasure until a quarter to eight.
Moved accordingly, and, on Question, motion agreed to.
[The Silting was suspended from 7.41 until 7.45 p.m.]

Telecommunications Bill
House again in Committee on Clause 8.
Lord Somers Lord Somers moved Amendment No. 76:
Page 10, line 47, at end insert—
("( ) The Secretary of State or the Director may also require any person applying for a licence under this section to publish his application in such manner as is appropriate for bringing it to the attention of the persons for whom the system will be provided in the area in which the service will he provided.").
The noble Lord said: This is a very simple amendment and is entirely non-controversial. It is simply to do with publicising the fact that services have become available. This is the age of advertising and so I do not think that this amendment will make any great change. The only point is that people who live in remote districts probably may not know of the fact that they are perfectly able to have a telephone. The publicity could be carried out in various ways. It could he done in a local newspaper, or by circulars sent to each house. However, the amendment does not lay down how it is to be done, but simply that it shall be done. I am sure that nobody could grumble with that in the slightest. I beg to move.
Lord Mottistone: I should like to support the amendment. In amplification of what the noble Lord, Lord Somers, has said, I would say that as I see the amendment it is concerned with a need for local consumers and perhaps consumer bodies to know in advance where an applicant is seeking to operate, so that they can take a view and make the necessary representations if they so wish.
Lord Mackay of Clashfern: The Government sympathise with what I believe to be the main purpose of the amendment; namely, to ensure that all those with an interest including consumers, and possibly competitors, are fully consulted and their comments taken into account before a licence which could affect their interests is granted. Indeed, that is also the Government's intention. Where we differ is just on the detail of how it should be achieved. The amendment seeks to enable the Secretary of State or the director to require applications for licences to be published. I presume that the intention is that the Secretary of State and the director should receive from interested parties comments and representations on such applications, though the amendment does not say so.
However, for the following reasons I do not think that publication of applications, as the amendment
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proposes, is the best way to proceed. First, the amendment relates only to applications for a licence under this clause. This is not in fact how applications for licences will work. A person will not apply for a particular licence or for one containing particular conditions. What he will do, instead, is to apply for a licence to run his system. It is then up to the Secretary of State to decide what kind of conditions he will impose, including conditions of the type described in Clause 8(1).
In short, the proposal to require publication of applications for licences containing Clause 8(1) conditions would not work because at the time of application it would not be known whether or not the licence, if granted, will contain such conditions. It therefore seems to me much better to have consultation after the Secretary of State or the director has considered an application and intends to include Clause 8(1) conditions, but before the licence is issued. This is what the Bill as drafted provides for in Clause 8(3). The subsection requires the Secretary of State to give notice of his intention to issue a licence and the reasons for this, and to allow at least 28 days for representations to be made, which he must consider.
I should also like to draw the attention of your Lordships in this connection to Amendment No. 75A, which we have already dealt with, and Amendment No. 78A, to which I have spoken. These strengthen the consultation procedure by requiring the notice to be published in a manner appropriate for bringing the matters to which the notice relates to the attention of persons likely to be affected by them. This will ensure that organisations such as consumer bodies, appropriate local authorities, manufacturers and other operators will be aware of a potential licence that could affect their interests and offers them a chance to make representations and objections. I believe that this is the best way to ensure that consultation takes place. I believe that, amended by the amendments to which I have referred, subsection (3) ensures that all those with an interest will he afforded an opportunity to make comments that must be considered by the Secretary of State or the director. Accordingly, the purpose that the noble Lords who support the amendment have sought to achieve is, I think substantially achieved at a slightly different time but again before the licence is granted, by virtue of the provisions of the Bill as strengthened by the amendments that I have described. I hope that, in the light of that, the noble Lord will feel able to withdraw the amendment.
Lord Taylor of Gryfe: I am thankful for the description of the protection in the Bill given by the noble and learned Lord, Lord Mackay of Clashfern. In view of all that he has said, I would counsel my colleagues to withdraw this amendment. I am delighted to have the assurances that have just been given.
Lord Somers: That is exactly what I was intending to do. I should like to thank the noble and learned Lord very much for the points he has put forward, which I found most convincing. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Spens Lord Spens had given notice of his intention to move Amendment No. 77:
Page 10, line 47, at end insert—
("(3A) Without prejudice to any of the provisions of section 7 or of subsections (1), (2) and (3) above, any prospective licence containing conditions applying to commercial activities connected with telecommunications the provision of all of which when taken together would satisfy 25 per cent. or more of the demand in the United Kingdom for such commercial activities shall only be granted in pursuance of a resolution of both Houses of Parliament specifically relating to each such licence.").
Lord Mottistone: This amendment is another way of attacking the problem that my Amendment No. 71 attacked earlier. I rise to my feet only to say that consequential upon it are Amendments Nos. 97 and 99. It is not proposed to move Amendment No. 77.
[Amendment No. 77 not moved.]
[Amendment No. 78 not moved.]
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 78A:
[Printed earlier: col. 514.]
The noble and learned Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 8, as amended, agreed to.
Clause 9 agreed to.
7.55 p.m.
Lord Mottistone Lord Mottistone moved Amendment No. 79:
After Clause 9 insert the following new clause:
("Limitations on the manufacturing business of public telecommunications operators
.—(1) Any public telecommunications operator whose commercial activities connected with telecommunications the provision of all of which when taken together would satisfy 25 per cent. or more of the demand in the United Kingdom for such commercial activities and who has a manufacturing capacity for telecommunication apparatus used by or in connection with the public telecommunication system operated by it shall not until such time as it has established a separately managed and accounting subsidiary for the manufacture of such telecommunication apparatus increase the scale of the manufacturing capacity it has at the date of the grant of its licence nor shall it produce in more than prototype quantities such telecommunication apparatus which it does not make at that date nor shall it at any time make such telecommunication apparatus or cause such subsidiary to make such telecommunication apparatus except to the extent and until—

(a) it has issued an open invitation to tender for the manufacture and supply of such telecommunications apparatus specified in the invitation and has allowed a fair and reasonable period within which bids can be submitted, and

(b) no offer to supply such telecommunications apparatus has been received which in the opinion of the Director would be acceptable, and

(c) it has satisfied the Director that manufacture of such telecommunication apparatus by it or its subsidiary will be on a fair and reasonable basis and will satisfy the requirements of section 3(2).

(2) A public telecommunications operator shall not acquire after the date of the grant of its licence, either directly or through any other company, more than 15 per cent. of the shares in a company engaged in the business of production of telecommunication apparatus for use by or in connection with the public telecommunication system operated by it.")
The noble Lord said: With the leave of the Committee, I should like to associate with this Amendments Nos. 80, 80A and 80B.
Amendment No. 80: After Clause 9, insert the following new clause—
("Limitations on the supply business of public telecommunications operators.
.—(1) Any public telecommunications operator whose commercial activities connected with telecommunications the provision of all of which when taken together would satisfy 25 per cent. or more of the demand in the United Kingdom for such commercial activities and who carries out the supply of apparatus which is to be connected to a telecommunication system and activities related thereto including export, installation, maintenance, adjustments, repair, alteration, moving, removal or replacement or any of such activities shall establish a separately managed and accounting subsidiary within twelve months of the date of the grant of its licence.
(2) The public telecommunications operator shall, prior to the establishment of such subsidiary, satisfy the Director that such activities will be conducted on a fair and reasonable basis and will satisfy the requirements of section 3(2).
(3) After the establishment of such a subsidiary the public telecommunications operator shall only conduct such activities through such subsidiary and shall satisfy the Director that such activites will be conducted on a fair and reasonable basis and will satisfy the requirements of section 3(2).")
Amendment No. 80.4: After clause 9, insert the following new clause:
("Meaning of "accounting".
.—For the purposes of sections (Limitations on the manufacturing business of public telecommunications operators) and (Limitations on the supply business of public telecommunications operators) the meaning of "accounting" shall include the demonstration to the satisfaction of the Director that each subsidiary shall be responsible for all expenses directly incurred by it together with a fair proportion of those expenses incurred by the public telecommunications operator in respect of work done or services performed wholly or partly for the benefit of its subsidiaries.").
Amendment No. 80B: After clause 9, insert the following new clause:
("Expenses of subsidiaries.
.—Without prejudice to the provisions of section (Limitations on the supply business of public telecommunications operators (6) each subsidiary' shall satisfy' the Director that it has ensured that the proportion of expenses incurred by others on its behalf to those directly incurred by the subsidiary is as small as is reasonably' practicable and in any event shall not exceed five per cent. by and after twelve months from the establishment of the subsidiary for each financial year of each such subsidiary.").
These amendments come about because of the proposal in Condition 21 of the draft licence to allow British Telecom to manufacture. The terms of the amendment do not seek protection from competition in product manufacture or in supply but seek to obtain safeguards that are essential to prevent unfair competition in these areas from competitors who have been granted privileges as licensed public telecommunications operators. It is pertinent to note that no network operator in the European Economic Community currently engages in manufacture and that the United States Government have, in recent years, gone to considerable lengths to separate network operations from telecommunication equipment manufacture. While the draft British Telecom licence includes conditions requiring separation of the systems business from that of supply and manufacture, total separation will be difficult to achieve and the date proposed in the draft licence for separation is several years ahead. This leads us to propose the amendment. It is perhaps also worth noting that Section 7 of the 1981 Act currently provides some protection of the

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sort that this amendment seeks to give, but the Bill proposes to repeal that section in Part II of Schedule 7.The proposed new clauses are to redress this repeal and to strengthen the current Condition 21. I beg to move.
Lord Mackay of Clashfern: The Government agree with the general aims underlying this amendment but we disagree with the attempt to achieve these aims through the Bill itself. Our view, first, is that if the Bill were to contain any special rules intended for British Telecom, these rules should apply also and fairly to all public telecommunications operators. The Government endorse the first specific proposal in the amendment, which is to require certain operators to set up separately managed and separately accounting subsidiaries for any telecommunications apparatus manufacture that they undertake.
The Government think that limitations of this general kind should apply to all public telecommunications operators regardless of their market share. Some discussion of the difficulties of the market share concept has taken place already.
It seems to us that public telecommunications operator status involves such privileges, particularly at a time when economic and environmental considerations cause us to limit the number of licences that may be granted, that it would be right to draw a clear line between the running of public telecommunications systems and the manufacture of telecommunications apparatus. The Government therefore believe that apparatus manufacture by any public telecommunications operator should be in a different company from that which runs the network with a different management and different accounts. The Government intend to put this policy into practice through Condition 21 of the draft British Telecom licence.
The Government believe that separation alone is not enough. Your Lordships know how funds can be transferred from one subsidiary to another through mechanisms like favourable transfer pricing. The Government believe that there should be a clear prohibition on cross subsidies between the two activities. The amendment makes no particular provision for this. Nor do the later amendments 80A and 80B deal with this matter. The Government believe that assistance can take forms other than money. There are various forms of preferential treatment, and we believe that these should also be prohibited. The Government intend to put this policy into effect through Condition 18 of the draft BT licence read in conjunction with Condition 21.
The second aim of the amendment is to limit the scale of a public telecommunications operator's manufacturing activities to the capacity at the date of the licence until it has established a separate subsidiary company. This idea may reflect the fact that in the draft licence British Telecom was given a two-year period of grace before it is required to have completed setting up its apparatus manufacturing company. We are well aware of the universal criticism of the two-year period of grace and we understand the concern about what could happen during this interim period. My right honourable friends in the Department of Trade and Industry are considering this aspect of the
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matter. The proposal that there should be some limitation on the scale of British Telecom's apparatus manufacturing activities during the period of grace is an idea that has not been suggested in any of the other representations that we have received on the licence. We are grateful to my noble friend for pointing out the problem.
Thirdly, the amendment deals with the production of prototype apparatus. As drafted, the amendment would stop British Telecom producing any new apparatus in prototype quantities after the appointed day. I am not sure that that is the effect that the noble Lord intended, but I should explain our view.
We wish to encourage British Telecom to engage in research and development work in telecommunications. I emphasised that earlier when dealing with an amendment from the noble Lord, Lord Lloyd of Kilgerran. British Telecom has aready achieved significant results, particularly in fibre optic cables and view data. We want British Telecom to do even better in future. But research and development necessarily involve the production of small quantities of prototype apparatus. British Telecom must be allowed to do this if it is to continue its research. However, as soon as production rises above prototype quantities, it should be transferred to the manufacturing subsidiary. Moreover, the subsidiary should pay the market price for the intellectual property—know-how, et cetera—involved in the apparatus. The amendment does not seem to deal with that aspect of the necessary arrangements.
Fourthly, the amendment states that British Telecom or the manufacturing subsidiary should not manufacture at all unless there has been an open tender arrangement and the director is satisfied that the arrangements are fair and reasonable. This arrangement, as drafted, appears to us to be impracticable. At present British Telecom is marketing to consumers a new telephone handset which it has manufactured itself, and the marketing is on the usual commercial terms. If the amendment were adopted, British Telecom's apparatus subsidiary would have to go through open tender arrangements before it even made, let alone sold, a single telephone to a consumer. This, as I have said, seems to us to be impracticable.
What the Government intend instead is that when British Telecom itself purchases 25 per cent. or more of any description of telecommunications apparatus, it will not be allowed to purchase such apparatus from its manufacturing subsidiary, whether for sale to members of the public or for use within its network, unless it has gone through an open tender procedure agreed with the director. I believe that this arrangement is practicable and will deal with a mischief which causes my noble friend, and those who support this amendment, concern.
Finally, the amendment seeks to prevent any public telecommunications operator—not just British Telecom—from acquiring more than 15 per cent. of any company producing apparatus used by that operator or for connection to its network. This is the only aim of those who have put forward this amendment with which the Government essentially disagree. One of the aims of liberalisation and

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privatisation is to ensure that the British information technology industry is able to respond to the rapid technological developments which are now occurring, and to convert these into British technology, British manufacturing, British jobs and British exports.
Recent and current developments in technology have broken down old distinctions between telecommunications, data processing and even entertainment. There is a convergence of technologies and regrettably many of the prizes are being carried off by others. It is increasingly apparent that firms do better in the market place if they combine expertise gathered from the different branches of the converging technologies. We welcome the participation of manufacturing firms like GEC, Thorn, EMI and local cable systems, some of which will we hope become public telecommunication operators. We would not want to stop them.
Overall, we wish British companies to play a full role in the development of information technology and we would not want to see a situation in which an innovative British firm, which needed to develop an idea in association with a large information technology company, could not enter into a joint venture with British Telecom because of a general prohibition like the one in the amendment. We think that joint ventures must be allowed, but I agree with my noble friend that this aspect has to be kept under careful review. That we intend to do. I hope that, in the light of this explanation, my noble friend may feel able to withdraw the amendment.
The Countess of Mar: I wonder whether the noble and learned Lord could possibly clear up one small point? At present, British Telecom manufactures small quantities of aids for the disabled. Obviously if these were put out to tender, they would just fall flat because nobody would want to know about them. Will British Telecom still be allowed to go on manufacturing these aids?
Lord Mackay of Clashfern: With respect, I think that that question is answered by what I said earlier; namely, that the Government intend that when British Telecom itself purchases 25 per cent. or more of any description of telecommunications apparatus, it would have to go through the open tender procedure. I would foresee no difficulty from the point of view of the apparatus that the noble Countess, Lady Mar, mentioned.
Lord Bruce of Donington: We on this side of the Committee would sustain the noble and learned Lord in his opposition to the amendment moved by his noble friend; but we find the noble and learned Lord's remarks far more menacing than the amendment itself. So far as we can see at the moment—and we shall have to study what he said in Hansard tomorrow—it would seem that, even assuming that manufactures are made on almost identical terms and on a fair competitive basis, British Telecom will be denied the economies of scale which of course have a very great impact upon price.
British Telecom over many years, first of all at Dollis Hill and later on at Martlesham, have
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developed a very formidable R and D department, and have been responsible, as has already been pointed out, for many discoveries in which private enterprise is only too happy to back them. Indeed, one of the purposes of the Bill is that the supporters of the party opposite shall be able to batten like leeches on the achievements of this public utility. I repeat: is it to be the case that, owing to the machinations of the noble Lord's mind—in so far as these are discernible from the draft licence which we are considering—every time British Telecom brings things to a new point of production (after the employment of the appropriate production engineers in drawing up the schedules, and so on) that, if they do it better than anybody else as soon as their demand for certain assemblies or subassemblies reaches a certain point, they are to be denied it? That does not seem to me to be very consistent with the maintenance of a public service, to which the party opposite seems to be formally committed.
Lord Taylor of Gryfe: I should like to make some comments before the noble Lord, Lord Mottistone, withdraws his amendment—and I should imagine, in the light of the statement made by the Minister, that withdrawal is inevitable because the Minister has conceded the case for the amendment and has even been more generous than is provided for in the amendment. I said on an earlier amendment that we on these Benches would do nothing to impede or frustrate British Telecom. I must say that the fewer constraints that are put on this company, the better for the efficient operation of the company. But from the statement just made by the Minister, there are a whole series of constraints that he wishes to build around British Telecom, and they are very serious.
I was for some years a member of the Board of British Rail. We had British Rail workshops manufacturing engines and rolling stock, and so on, in order to run the railway system. If the same constraints were to he put on British Rail, they would be prevented from manufacturing the apparatus which carries railway passengers. What noble Lords are saying is that British Telecom should simply run the system and should not be permitted to manufacture the apparatus. By the same token, we could apply the same provisions to British Rail, and say that they would not be permitted to have their own workshops manufacturing their own equipment; that their purpose is simply to carry passengers.
An interesting point—and I see that the noble Lord, Lord Howard, is in his seat—is that as a spin-off, the British Broadcasting Corporation has developed a highly efficient computer. If we were to apply the same constraints to the BBC and say that its job is to run the television programmes, it would not have been possible for it to manufacture the computer and to put it on the market. I believe that it is for the board of the new company to decide whether or not a vertical operation would be in the best interests of the shareholders and the company. They will look at the market for apparatus; they will look at their research capability; and in their wisdom they will decide whether it is better for them to manufacture on their own behalf or whether it is wise to buy-in the equipment.

533
From time to time they may even test the market. But it is surely not in the interests of British Telecom to manufacture something they that they could buy outside. They are entitled to test the market, but they are also entitled to the freedom to test the market, and in the statement that the Minister has made that freedom is being denied. They will he prevented from manufacturing apparatus on their own behalf; therefore, they must go to the market. They will not be able to test their own capacity against that of outside manufacturers. I am sure that the amendment is about to he withdrawn, but at the same time I am somewhat alarmed at the constraints which the Minister has mentioned will be placed on this company.
Lord Mottistone: I thank my noble and learned friend very much for his remarks. In any case I did not think that the wording of the amendment would be perfect. I was amused at the number of things which we had not thought of and which my noble and learned friend had thought of in order to strengthen the amendment, which were very good to hear.
To deal with the remarks of the noble Lord, Lord Taylor of Gryfe, the whole thing would be easy if the company did not have a monster monopoly. That is the problem. Otherwise, one would go right down the road with all that he said. If it only had half the monopoly it has now, it would be manageable; but to go into the market place with 90 per cent. of the market means that it needs some restraint. I particularly liked the remarks of my noble and learned friend about the prevention of cross-subsidisation. However, as was foreseen, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 80, 80A and 80B not moved.]
Clause 10 [The telecommunications code]
8.13 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 81:
Page 12, line 2, after ("be") insert ("especially").
The noble Lord said: It may be for the convenience of the Committee if I say that this is the first of a long series of amendments concerned with the protection of the physical environment, and that I propose to speak on this relatively unimportant and formal amendment by referring to most, if not all, of the subsequent amendments. It will not shorten the debate on this amendment, but it may make it easier to shorten the debates on the subsequent amendments.
It is only in this subsection that there is reference to the physical environment. It is left to the telecommunications code, which comprises Schedule 2 to the Bill, to go into detail about the protection which is to be afforded to the physical environment and to individuals who are affected by telecommunications operators' systems and apparatus.
It is necessary to write in extra protection for the physical environment where no extra protection has existed in the past because of the legal and practical changes which will take place as a result of this Bill.
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For example, it is proposed that British Telecom will lose the planning exemptions which it has had up until now under general development orders and special development orders. That is an example of a legal obstacle which has now changed. An example of a practical change is that if we take the object of the legislation seriously and we have a large number of telecommunications operators, we are faced with the possibility of many cables, including the possibility of many overhead cables, affecting our streets, our cities, our farmland and our areas of natural beauty.
The object of the amendments which are proposed here is that the responsibility for the protection of the physical environment should be taken out of individual licences and put explicitly into the telecommunications code, which comprises Schedule 2 to the Bill. This is not merely a matter of convenience; it is certainly not particularly a matter of profound political principle or political decision; but it is a matter which is important to those who wish to understand their rights and the rights of those who wish to protect the physical environment.
Imagine the position of someone who learns of the threat of overhead wires in an area of outstanding natural beauty. In order to understand the nature of the threat which he apprehends, he has to look in the licences of all the potential operators who might be posing the threat to the area of outstanding natural beauty. He has to look in all the different codes of practices which might be relevant to the operations of these telecommunications operators. Practically, it would be impossible for any individual objector—and the objectors to the despoliation of the physical environment tend to he scattered, weak, ill-informed and ill-served by bodies of lawyers and civil servants—to mount an effective opposition to threats to the physical environment. Therefore, the intention of these amendments is that the telecommunications code should he as explicit as possible so that no special protection is needed in the individual licences.
Perhaps I may refer briefly to the individual amendments so that your Lordships can gain an idea of the kind of protection which we believe should be incorporated in the telecommunications code. I come first to Amendment No. 83:
Amendment No. 83: Page 89, line 4, at end insert—
(" "the physical environment" includes—

(a) the architectural, archaeological or historic character of any building, structure, feature or area,

(b) the natural beauty and amenity of the countryside or an open space or garden, and

(c) the conservation of wildlife or any physiographic feature").

Amendment No. 83 defines the physical environment. There is no definition elsewhere in the legislation. If we are to talk about its protection, it is desirable that it should he defined, and defined as explicitly as possible, as including, for example, archaeological sites as well as areas of natural beauty.
Then we come to Amendment No. 85, followed by Amendments Nos. 90 and 91:
Amendment No 85: Page 89, line 38, at end insert—
("Protection of the physical environment
1A. All telecommuncation apparatus under this code shall be planned, installed, maintained or altered having regard to the need for protecting the physical environment and this shall not be avoided solely by the payment of compensation to any person claiming to be affected.").

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Amendment No. 90: Page 97, line 33, leave out ("paragraph") and insert ("paragraphs 1A (Protection of the physical environment) and").
Amendment No. 91: Page 98, line 18, leave out ("paragraph") and insert ("paragraphs 1A (Protection of the physical environment) and").
Amendment No. 85 refers to the need for actual protection which cannot be bought off by compensation. Compensation is short-lasting. It benefits those who have some claim to compensation; it does not benefit those who come afterwards and who are the users and enjoyers of the physical environment. Compensation is no substitute for prevention of despoliation of the physical environment, and the intention of these amendments is to ensure that we have prevention, not compensation.
Then there is Amendment No. 87:
Amendment No. 87: Page 96, line 23, at end insert ("or on the ground that the works necessary to afford the potential subscriber access to the operator's system would cause undue damage to the physical environment.").
This amendment refers to the possibility that a telecommunications operator may, by virtue of his obligations to a subscriber or potential subscriber, be obliged to seek powers to damage the physical environment. The intention of this amendment is to say that damage to the physical environment is a valid reason for objection to the proposed despoliation.
The next amendment is Amendment No. 88:
Amendment No. 88: Page 97, line 13, at end insert—
("( ) Sub-paragraph (1) of this paragraph shall not apply to an agreement or covenant imposed by or for the benefit of the National Trust, the National Trust for Scotland, a local authority or any other body for the protection of the physical environment.").
This amendment is a very important amendment indeed, and refers to the status of covenants with the National Trust, the National Trust for Scotland, local authorities and all other bodies concerned with the protection of the physical environment which at the moment have covenants with landowners, tenants and others to ensure the continued use and protection of the physical environment. As the legislation stands at the moment, the telecommunications code allows for the possibility that these covenants could be overridden by agreement between a telecommunications operator and subscribers, and that such an overriding of covenants could be permitted by the Office of Telecommunications and the director general. Our amendment is designed to close that loophole.
I come now to Amendment No. 89:
Amendment No. 89: page 97, line 31, at end insert—
("( ) The operator shall be responsible for restoring as far as practicable the surface of the street, highway or land to its condition before any of the things referred to in this paragraph had been done.")
Amendment No. 89 refers to a matter which, again, is of very great importance indeed; namely, the restoration to its original condition of land which could be farmland, common land or whatever kind of land, and also streets and highways, after the completion of the work of making a telecommunications installation. This is a matter which has been threshed out over many years in environmental circles. For example, the protection of farmland in which gravel working has taken place has largely been in the form of the requirement that the land should be restored to its original
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beauty, to its original condition, or to its original agricultural value after the work has been completed. That is the intention of this amendment—to ensure that those rights and those powers to ensure adequate restoration are included in the legislation.
I now come to Amendments Nos. 92 and 93:
Amendment No. 92: page 104, line 11, at end insert ("or altered")
Amendment No. 93: page 104, line 16, after ("completion") insert ("or alteration")
Amendments Nos. 92 and 93 refer to the conditions in the telecommunications code about the completion of works, and the amendments seek to ensure that there is no weakness in the definition of "completion", that works of alteration to telecommunications apparatus, alterations to overhead lines, for example, also fall within the restrictions of the code.
Amendment No. 94: page 104, line 17. at end insert ("or has a legal right of access to")
Amendment no. 94 refers to the legal right of access. At the moment, the legislation in the code would provide that there has to be consultation and agreement with the owner or occupier. We are proposing to add that there should be agreement with those who have legal right of access, who may well be the general public, or the general public as represented by different environmental bodies.
Amendment No. 95: page 110, line 48, at end insert—
("(2) A local authority shall have the power—

(a) to require the removal of any telecommunication apparatus that appears to be abandoned.

(b) to remove abandoned telecommunication apparatus where the operator has failed so to remove after reasonable notice, and

(c) to recover from the operator all expenses incurred under paragraph 22(10)(b) above.")

Amendment No. 95 deals with the problem of the removal of disused apparatus. I am sure your Lordships will have seen around the streets of our cities the large number of dead cars which have to be removed by local authorities from the highway, and the powers to remove them have been achieved with some difficulty by local authorities over the years. This is an essential part of the protection of our urban environment, and I wish it were so for our rural environment as well: there should be powers to remove disused cars. The same should apply to disused telecommunications apparatus, and the amendment seeks to provide that local authorities have the same powers as they have for the removal of cars.
I come now to Amendment No. 96.
Amendment No. 96: page 115, line 9, at end insert—
("Development Orders under Town and Country Planning Acts
27A.—(1) A development order made under section 24 of the Town and Country Planning Act 1971 granting permission for the installation of telecommunication apparatus under this code shall not have effect unless approved by a resolution of each House of Parliament.
(2) A development order made in accordance with subparagraph (1) above shall contain provisions enabling the local planning authority to require to be consulted on proposals for telecommunication apparatus in national parks, areas of outstanding natural beauty, conservation areas and other areas of high amenity or historic value or special scientific interest and to have the right to require the operator to apply to the court under any of the provisions of this code where objection could be raised by an occupier or owner affected by the apparatus".)
This amendment refers to general development orders involving telecommunication apparatus, and requires that orders of this kind should be submitted to Parliament for approval before they are finally confirmed.
I apologise for having spoken for 10 minutes on what may seem a trivial amendment, but I think your Lordships will agree that it is necessary to make a general introduction to all these amendments so that the discussion on those amendments will be better directed if the purpose behind them—which is a single purpose—is adequately understood from the outset, rather than being pieced together bit by bit as we proceed through the amendments. They are easily recognisable. They have straightforward numbers without the accretions of ZAs, ZBs, QSs and whatever else there may be. That simply means that I got in first before anyone else!
I do believe that we have here a series of noncontroversial amendments. I shall listen with attention and sympathy if the Government find there are defects in the wording of the amendments and suggest ways of putting those defects right. But I do believe the object behind the amendments is one which will be agreed by the whole Committee and I feel sure that at the end of the debate, given goodwill by the Government, we shall see significant improvements in the quality of the legislation as well as the quality of the physical environment. I beg to move.
Lord Mottistone: Strangely though it comes from me to say so, I have great sympathy with the general theme of what the noble Lord, Lord McIntosh of Haringey, has just put across, and I shall be most interested to hear what my noble friend has to say from the Front Bench.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Glenarthur): I am most grateful to the noble Lord, Lord McIntosh of Haringey, for his explanation of how his various amendments link up and their importance. However, I am bound to say that, while he mentioned a great many other amendments, he did not express in detail the intention behind Amendment No. 81. As I see it—and I strictly limit myself to Amendment No. 81 because the others are of considerable importance and I will mention them at the end—Amendment No. 81 is intended to provide for the Secretary of State to include exceptions and conditions in the licence of an operator to whom code powers are applied which appear to him to be especially "requisite or expedient" for the purpose of securing that the physical environment is protected and that the other matters in Clause 10(4) are dealt with. I have to tell the noble Lord that, so far as drafting is concerned, this amendment is quite superfluous. The phrase "requisite and expedient" covers all eventualities and allows the Secretary of State to include any conditions and exceptions necessary to secure the particular objectives mentioned.
The phrase "requisite and expedient" is a well tested legal formula and I see no reason to qualify it as this amendment suggests. What is more, the addition of
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the word "especially" before the words "requisite or expedient" would have the opposite effect to what I imagine the noble Lord is seeking to achieve, for it would enable the Secretary of State to include in licences only those exceptions and conditions which were especially requisite or expedient for the purpose of securing that the physical environment is protected.
Nonetheless, as I think I indicated earlier, we realise that there are important issues to be debated on Schedule 2 and I think that it would be best if we dealt with the substantive matters of concern in that context—for example, in relation to the protection of the physical environment to which the noble Lord has referred. So I hope that, with that explanation of this particular amendment, he will not press the amendment.
Lord McIntosh of Haringey: With the slight qualification that I find it difficult to understand how the addition of a word can be both superfluous and damaging, I can see the thrust of the arguments of the noble Lord, Lord Glenarthur, and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Cockfield Lord Cockfield moved Amendment No. 81A:
[Printed earlier: col. 514.]
The noble Lord said: This is purely a drafting amendment. My noble friend the Lord Advocate, Lord Mackay of Clashfern, in fact spoke to this on Amendment No. 75A. I beg to move.
On Question, amendment agreed to.
Clause 10, as amended, agreed to.
8.29 p.m.
Baroness Lane-Fox Baroness Lane-Fox moved Amendment No. 82:
After Clause 10, insert the following new clause:
("Compatibility with hearing aids.
. All telephones fitted to public telecommunications systems shall be compatible by internal means with hearing aids designed for use with the telephone by 1st January 1990.").
The noble Baroness said: I know from reading Hansard that my noble friend the Minister mentions very sympathetically the subject of my amendment in Amendment No. 37, and I am hoping to keep up that spirit to further this cause.
To lay people like myself, it appears that relatively slow progress has been made through medicine to ease the problems of those whose hearing is impaired. This emphasises the need for technology in electronics to come to their rescue, and telephones which can be used by people wearing hearing aids are obviously very important. It is ironic that the new electronic telephones can threaten the facility enjoyed through inductive couplers which work within the fast-disappearing Type 700 telephone. This is a blow technology can strike against the attempt made by those who are deaf to be useful, integrated people. To be unable to use the telephone seriously disrupts their social and business lives, their enjoyment and promotional prospects.
Do not let me suggest for one moment that someone is purposely slapping down the chance of deaf people to use the telephone. The fact is that the shapes of electronic telephones are not immediately suitable to

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house inductive couplers, but they are cheaper to manufacture and to purchase, and they have other advantages to offer over the Type 700. One bit of good news is that British Telecom has already put out on trial some models of their electronic telephone named the Statesman, and that model has already been adapted for use with inductive couplers. Reports are encouraging and British Telecom is being helpful over this trial. However, the shape of their Viceroy telephone and others made elsewhere but of similar oblong design makes the question of adaptation of these a difficult manufacturing problem.
Nevertheless, I hear from a spokesman of the British Association of the Hard of Hearing, Mr. Hart, who is expert in these matters, that there really is no technical reason why these models cannot be made compatible. The actual cost of an inductive coupler, I understand, is about 30p. It is estimated that approximately 6 million people would benefit if all telephones were made compatible with hearing aids. In my family I happen to have three members who use hearing aids, so I can vouch that the question affects the whole household.
In the past four years things have improved. During that time BT agreed to make the necessary adaptations to 77,000 public telephones, and they now say that this work will be completed by April. The fears of people with their hearing impaired now lie not only in what I have already described but also with electronic telephones waiting to enter the market and which use, I am told, piezoelectric crystals. The tiny amount of current having to be used within them makes it hard for the telephones to operate properly with inductive couplers, or for amplifying handsets to be fitted to them.
To look at the economic aspect, it is important to remember that 6 million people can benefit from having all telephones compatible with hearing aids. As it is now many already have telephones in their homes which are mainly used by other people. It is estimated that those people whose hearing is impaired, with telephones that they cannot now easily use, number about 2 million, and that armed with compatible telephones they will make at least two additional telephone calls per week and will receive per week at least two additional incoming local calls. That amounts to £18,304,000 a year extra revenue for BT even at that low estimate.
It would be wrong to miss this opportunity to try to improve the technological potential of help for hearing-impaired people; help to prevent their position from falling back—that is what it would do—if their need is forgotten at this important time in the present effort for general progress. Sir Francis Bacon, I believe, spoke of the importance of science as, "the endowment of human life with new inventions and riches". Would not your Lordships agree that this is a time when we should at least stifle any threat of man's inhumanity to man being exercised against a group of people growing, alas, particularly among the young? The amendment modestly requests that by 1st January 1990 all telephones fitted to public telecommunication systems shall be compatible by internal means with hearing aids for use with the telephone. It is my pleasure to move this amendment.
Lord Lyell: The whole Committee will have been fascinated and thrilled to hear the main purpose of this amendment so admirably moved by my noble friend Lady Lane-Fox. She mentioned quite correctly that I had touched on this problem and this particular amendment when I was speaking on Amendment No. 37 last week, when we covered the problems of new technology and the blind or those whose sight is impaired. I recall the noble Lord, Lord Stoddart of Swindon, mentioning his interest. He went so far as to use the term that he awaited with bated breath. I hope he has not been holding his breath all weekend, and I hope that when he comes to hear what I am afraid is a rather lengthy explanation of this complicated subject, that he may be interested, as I was when I studied the entire background not just to inductive couplers, but to the new frontiers of technology.
I am sure from the explanation given by my noble friend that your Lordships will appreciate that this amendment reflects the great concern about the future availability and supply of telephones which are adapted for use by the hard of hearing. I should like to consider this as two separate problems. First, we want to ensure that the hard of hearing and the hearing impaired can continue to obtain telephones which are adapted to their needs; and, secondly, to ensure that the new telephones, with the new technology which is with us now and certainly will be improving before 1990—and not just this admirable Statesman model described so well by my noble friend Lady LaneFox—and coming onto the market in the future will also be adaptable for use by the hard of hearing.
I hope that my noble friend and those of your Lordships who are interested in this problem will not take me to task too much if I say that we believe that this amendment does not quite separate out the two problems which have different though related solutions. I stress at the outset that the Government are taking action to resolve both these problems.
May I explain as briefly as possible—and I shall keep an eye on the Clock—what we are doing and why we are doing it. On the first question of ensuring the continued availability of telephones which are adapted for the hard of hearing, the Bill and the British Telecom licence together contain a firm guarantee that such telephones will continue to be available. I spent some time on the Bill in our earlier discussions on Clause, 3, and that would have covered Amendment No. 37, so may I concentrate now on the draft BT licence.
Conditions 32 and 33 in that licence are specially concerned with the hearing impaired and the hard of hearing. Condition 32 obliges BT to continue to make available telephones which incorporate the inductive coupler. I understand that this enables people with hearing aids under present technology to use the telephone—again I stress under present technology—and Condition 32 also obliges BT to continue to make available telephones with amplifiers—and this is a separate part of this problem—enabling people with impaired hearing to use the telephone without hearing aids.
What this will mean is that the familiar Type 700 series telephone, which can be fitted with the inductive coupler, will continue to be available. I believe that

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licence conditions, as I have tried to set them out, are a stronger safeguard than the position at present.
Baroness Lane-Fox: May I ask my noble friend the minister whether he feels happy about the Type 700 telephones? I am told that they are becoming more and more difficult to obtain. This is what I hear from the British Association of the Hard of Hearing.
Lord Lyell: I am familiar with the telephone that we use at the moment, but I was not aware that it was called the 700. The noble Baroness referred to the percentage of telephones in callboxes which were fitted with inductive couplers. Perhaps I mght ask my noble friend to come with me to some of the telephone boxes in my rural area. If they are fitted with the familiar 700 series, I would not know whether the telephones were fitted with inductive couplers. They did not seem to me to have them, but they have the technology of the 700 series telephone. I am afraid I cannot answer my noble friend's question at this point. If I have not answered it satisfactorily by the time I come to my conclusion perhaps she will take it up with me. If I receive any information I shall give it to her, otherwise, I shall be in touch very swiftly.
I stress to your Lordships that the licence conditions will be enforced by the director. I give one brief example. If the director finds out, through a complaint or otherwise, that BT is not complying with the licence conditions—I take the example further—and is not supplying a telephone fitted with an inductive coupler to someone who wishes to use it, the director will be obliged (I stress that to my noble friends) to take enforcement action, and he can order BT to supply such a telephone.
I will not definitely say that it is the type 700, for reasons that I shall enlarge on briefly. My noble friend has enabled me to expand briefly on Condition 32. I understand that Condition 32 will ensure that the 700 telephone model continues to be available. If anyone has difficulty in obtaining a telephone with an inductive coupler, under Condition 32 the director will be able to issue the order forcing BT to provide it.
I shall now consider public callboxes. Your Lordships will see that Condition 33 of the draft licence requires BT to work towards installing apparatus in all public callboxes. For example, if we take the inductive coupler, that apparatus will enable the hearing-impaired to use that telephone. I know that there is concern that this is being done too slowly. My noble friend mentioned the gap. I believe she mentioned April this year as the target date by which BT hope to have all telephones in public callboxes fitted with inductive couplers. I am pleased to be able to say that BT have already fitted 97 per cent. of all telephones in public call offices with inductive couplers, and it hopes to have all public telephones in callboxes fitted with inductive couplers before the licence enters into force. Whether those last remarks tie up with the month of April, I do not know. Indeed, my noble friend may be ahead of me, both in technology and information, but this is the information that I have.
We are considering the possibility of strengthening Condition 33 to reflect this last point. Before I leave the matter of the licence the Department of Trade and
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Industry has received detailed comments from the British Association of the Hard of Hearing, and the department is considering these comments actively and very carefully. I hope that the Committee has been reassured so far on what I have said about ensuring that the needs of the hearing impaired continue to be met.
At the outset of my remarks I mentioned the second half of the problem, which is considering the future. As I am sure your Lordships are aware, I mentioned the coming technology. I am sure Your Lordships are also aware that coming onto the market are telephones which, because of their design, cannot be fitted with the inductive coupler, which is the device we have at the moment. I very much hope that a way will be found to overcome this problem, and I know that British Telecom has a study group which is at present working on this.
However, the main problem will come further on in the future with the new generation telephones, which, not because of their design but, far worse, because of their advanced technology, will not be able to be fitted with the present type of inductive coupler. It is to this problem, which is one of technology and not necessarily privatisation, that the amendment is primarily addressed. What we understand and believe that the amendment seeks to do is to ensure that by 1st January 1990 all telephones attached to public telecommunications systems shall be "compatible by internal means" with hearing aids. We sympathise with the intention, but I fear that this amendment does not achieve what it sets out to do, simply because it will be unworkable. I shall explain this and then go on to explain the steps we are taking to ensure that a solution is found.
The main reason why the amendment would not work is that nobody yet knows how to make the new generation of telephones compatible with hearing aids. It is not just the Statesman, which my noble friend mentioned, because by 1990, the target date mentioned in my noble friend's amendment, there could easily be new technology which would make the current type of inductive coupler, if not obsolete then certainly obsolescent. At present we think that inductive coupling may be the answer, but we do not know. We may take another alternative in this field. The answer may lie in adapting not the telephone but the hearing aid. I stress that we are taking steps to find out, but I do not think that we should legislate for something that we do not know how to implement.
Secondly, we want to consider the other side of the coin—the manufacturers of inductive couplers, hearing aids and telephones. This amendment would mean that the manufacturers could not bring onto the market telephones which would not be internally compatible with hearing aids. This would certainly constrain technology, and we think it would prevent developments which would not only be of benefit to a large number of consumers but would also provide export opportunities for United Kingdom manufacturers. In short, we think that the amendment will inhibit technological progress.
This is not desirable, but once more I want to repeat and stress to your Lordships that the hearing impaired will still be able to have telephones fitted with

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inductive couplers, regardless of technological advances, since this is assured by Condition 32 of the draft licence.
The Earl of Cork and Orrery: I wonder whether my noble friend would be kind enough to explain what an inductive coupler is.
Lord Lyell: I regret to say that I have not used one, nor seen one, but if I am able I shall try to find a brief explanation. I know exactly where I shall go to obtain a brief explanation. If I cannot obtain something in printed form from my regular advisers, I know precisely where I shall go. It is to a Member of your Lordships' House, but I had better not call him my noble friend. I shall inquire for my noble friend where I can find a diagram of an inductive coupler. I stress that I have not yet used one: I am able only to explain what the inductive coupler does at present, and what we hope it will continue to do, as far as is possible. I take my noble friend's point, and if I can help him I shall.
Baroness Lane-Fox: May I interrupt my noble friend for one moment to say that it was described to me by somebody fairly expert as being little more than two bent pieces of wire which happen to alert the particular point at the right time.
Lord Lyell: My noble friend is absolutely correct. I have a fascinating heading, which I am sure my noble friend will appreciate. Perhaps even your Lordships will appreciate it. The heading is, "Unfair". But we are used to unfairness and unfair questions being thrown at us with such charm by my noble friend—indeed, by both my noble friends. An inductive coupler is, in general, a small coil which amplifies the stray magnetism in the telephone; that is, in the hearing piece. With enough stray comment, perhaps I may continue to try to satisfy your Lordships' curiosity in the hard-of-hearing and the hearing-impaired about what we want to do and how we hope that new technology may bring differing solutions. All the time, we continue to bear in mind the problems of the hearing-impaired and the hard-of-hearing and of how we hope that this will be achieved through the conditions of the licence and in the Bill.
If I may conclude the discussion of the amendment, we believe that it is impracticable because, as we understand it, it is addressed to all telephones—that is, the 700 and any older models, and not just new ones. I understand that at present there are nearly 29 million telephones attached to BT's network alone. Very many of these telephones will not be replaced before 1990. Thus, the amendment is going to mean that, on 1st January 1990, someone, somewhere, is going to have to fit inductive couplers to all these telephones and, indeed, to all those attached to other public telephone communication systems—which I think my noble friend and your Lordships will admit would be an enormously expensive task.
I hope that I have explained why we believe the amendment to be impracticable. I stress that the Government recognise that there is a problem with the hearing-impaired and hard-of-hearing and are already taking steps to find a solution. The DTI has set up a
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working group of experts. This group includes representatives of the hard-of-hearing, of the British Association of the Hard of Hearing and the Royal National Institution for the Deaf. It includes the manufacturers, British Telecom and the Department of Health and Social Security. I stress to my noble friend and to the Committee that there is no question of the hard-of-hearing or the hearing-impaired, as my noble friend said, falling back.
May I conclude by stressing what this working group is doing? They have clear terms of reference. They are looking at the problems: both at the present problems which have been so admirably set out by my noble friend and at the future of adaptations of telephones of all types for the hard-of-hearing. In particular, this group is going to be looking at the new technology. No doubt one of the things that they will be looking at is the possibility of a requirement that all telephones must be adaptable. I do not want to prejudge their findings, especially in view of my own knowledge of technology, which has been shown to be somewhat lacking this evening.
As I stressed earlier, it may be that adaptations to hearing aids also offer a way forward. It is a complex area but I hope that the working group in due course will advise the Government on the next steps. I stress that this is a longer-term problem. The old familiar telephone, be it the Series 700 or the even older ones, will not disappear overnight. The future availability of the Type 700 and the current telephone is assured by Condition 32; but there is no doubt of the Government's determination to find a solution to the long-term problem. I have spent a long time, and I apologise for this; hut, judging by the fan mail and the encouragement that I got on Amendment No. 37, I hope your Lordships will forgive me for spending time on this subject. I hope that I have reassured the Committee and I would ask my noble friend whether she is able to accept my comments and possibly to withdraw her amendment.
Baroness Lane-Fox: I am grateful to my noble friend the Minister for a very full reply. I feel very responsible in speaking for so many who are waiting on the answer to this question. I feel that the answers that my noble friend has given are quite enough for us to wait and be vigilant and to make sure that we keep everybody up to the mark on this. I am sure that the last thing that hearing-impaired people would want would be to hold back technology. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.55 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 83:
[Printed earlier: col. 534.]
The noble Lord said: This is where I hope the benefits of my encroaching on your Lordships' time on the preceding amendment will become apparent. The intention of this amendment seems to me so self-evident that I cannot think that there will be difficulty on it other than with its wording. Clause 10 refers to the protection of the physical environment and the preservation of the natural beauty and amenity of the countryside, both of which are admirable objectives.

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The intention here is to spell it out and to be more precise about what is meant by the physical environment, to ensure that we are talking about architectural, archeological and historical characteristics and that we are talking about the conservation of wildlife as well as the physiographical features. I shall await the friendly comments of the Minister.
I would say only that it would be helpful if the Government could indicate in their reply on this amendment whether the basic objective behind the series of amendments—which is to make the telecommunications code as explicit as possible and to avoid further definitions and conditions in individual licences—is acceptable to the Government; and whether the Government are in sympathy with that objective. It would help in understanding the Government's reactions to later amendments. I beg to move.
Lord Howard of Henderskelfe: I rise for one minute to say that my definitions in the amendment to which we are coming shortly are much more specific and specialised than are the definitions of the noble Lord, Lord McIntosh of Haringey. This does not mean that we are not in many respects trying to cover the same ground: it merely means, I think, that he is a generalist and, in this. I am a specialist. I think that we are both trying to achieve the same kind of object and therefore I would commend his amendment to the Government in saying that it may be that the one or the other, the more specialised or the more generalised description, may be appropriate in this case. I do not presume at this stage to judge.
Lord Glenarthur: The noble Lord explained at some length the purpose that lay behind his series of amendments when he spoke to an earlier amendment. Does the noble Lord wish to intervene?
Lord Bruce of Donington: I query the phrase "at some length".
Lord Glenarthur: Not at greater length than has been the case with other amendments, no; but it is a question of comparison. What I want to put across, without wishing in any way to pre-empt the amendments which are going to come in later on, is that this amendment rather than the earlier ones to which he spoke is probably in a way setting the tone for the others.
I begin by assuring the Committee that the Government regard the matter of the physical environment as of importance and that we have already taken steps to guard against the possibility that the powers in the telecommunications code could be used in a way which could have unfortunate consequences for the environment. At present, the basic legislative safeguards for the environment are to be found in the Town and Country Planning Acts, which establish controls designed to ensure that a whole range of activities can be controlled in such a way as to protect the physical environment.
In the context of this amendment, your Lordships may be aware that the Department of the Environment has recently issued a consultative document on the revision of the general development order under
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the Town and Country Planning legislation. The consultative document deals, among other things, with the planning aspects of telecommunications. It makes the point that the planning system will have to reflect the changes that this Bill will bring about and also accommodate the growth of telecommunications without either imposing unnecessary restrictions or allowing what is described as serious damage to physical amenities and telecommunications development. It proposes therefore that all telecommunications operators to whom the powers of a telecommunications code are granted should be given permission under a revised general development order to install minor telecommunictions apparatus such as wires, poles, small antennas and similar things, without the need to seek specific planning permission in each case.
Some arrangement of this kind is essential in order to avoid overburdening the planning system. However, the proposals put forward in the consultative document envisage that they would be put into effect against the background of firm licence conditions framed under the powers of Clause 10(3) and (4) of the Bill, qualifying the use that a particular operator may make of code powers.
Part 5 of the draft licence indicates what kind of conditions we envisage imposing. I think that they go a very long way towards meeting the concerns expressed by the noble Lord in his amendment. For example, there are specific conditions which require all new telecommunication lines to be placed underground in conservation areas, subject to very minor exceptions. In saying that these concerns have been met, I do not at all wish to appear too categorical. We have deliberately made available the licence in draft form, as the Committee knows, so that we might benefit from informed public comment upon it. Regarding Part 5, we have so far had very little reaction, and this and related amendments have given us the first real opportunity to consider whether what we are proposing is adequate.
Turning to this particular amendment, it would be unfortunate, given the framework of the general development order and the licence conditions which I have just outlined, to embark on a third avenue, what amounts to a planning control for the telecommunications code itself. We already have a provision in Clause 10 which deals with the protection of the physical environment through licence conditions; and it may be that before concluding that the code should be modified, your Lordships would wish to consider whether the description in subsection (4) should he further particularised in order to cover some of the categories of the environment covered in this amendment. I have to say that the Government's initial reaction is that that would not be a particularly satisfactory course to adopt since the more detailed the definition, the more likely it is to appear to exclude those areas not specifically mentioned.
May I also add in this context that the movers of this series of amendments are not perhaps fully aware of' the way in which the licence conditions will be formulated in order to protect the environment. The BT licence is in a special category because it needs to be in effect on the appointed day when the Act comes into force. Other licences which grant code powers, for

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example to the new cable system, will be the subject of public consultation with those who will be affected by the exercise of code powers. Thus the relevant local planning authority will be consulted in each case before code powers are applied and it will have the opportunity to suggest what particular restrictions or requirements should be introduced into its own area to meet the particular needs of the locality. I firmly believe that this offers a far more flexible and acceptable approach to dealing with these sensitive matters than laying down rigid general rules in either the code or the general development order.
In summary, I hope that what I have said has been sufficient to indicate the Government's receptiveness to suggestions for improvements of the licence conditions related to the telecommunications code. I hope it has given the noble Lord the flavour of the comments that apply to the amendments which follow. I hope that he will find the explanation reassuring and that he will see fit not to press his amendment.
Lord McIntosh of Haringey: I fear that I find that reply deeply disappointing. Of course, I was well aware of the amendments proposed by the Department of the Environment concerning the general development order, just as I referred in my speech on Amendment No. 81 to the prospect that BT itself, when privatised, will lose certain planning exemptions. But the noble Lord has shown no understanding of the necessity to have conditions under which the physical environment is to be protected in one single place which can easily be found—which I suggest must be in the telecommunications code. If we follow the Government's proposals we shall find that there are individual elements in each licence which will be concerned with the protection of the environment, as the noble Lord, Lord Glenarthur, has said, with reference to the only licence of which we know anything, which is the draft BT licence.
I suggest that it is not satisfactory' to have it in the licence: it is not satisfactory for those of us who are concerned with the physical environment to have to look at the licence, to look at the general development orders or special development orders to see whether Article 4 directions have been given which remove concessions in the development order. It is not satisfactory to require those who seek to protect our physical environment to embark on "a treasure hunt" in order to find the legal obstacles which they are seeking to overcome. They should he in one place, and that place should be here in this legislation.
I accept that there is more than one possible way of wording this amendment and I shall listen with interest to the noble Lord, Lord Howard, with his specialist knowledge. Only because of the possibility of improved wording at a later stage do I now seek leave to withdraw this amendment.
Amendment, by leave, withdrawn.
9.7 p.m.
Lord Glanusk Lord Glanusk moved Amendment No. 84:
Page 89, line 14, after ("running") insert ("or testing").
The noble Lord said: I expressed an interest on Second Reading which I do not intend to repeat now,
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unless your Lordships wish me to do so. This amendment is by way of being a probing amendment. Throughout the Bill there appears to be no mention of test equipment. which is essential to the maintenance of telecommunication systems. In Clause 4 there is a definition for telecommunications apparatus, which is designed to cover such items as are connected to the line and involved with transmission of signals, such as modems and switches. It does not appear to include test equipment which does not transmit signals.
In Schedule 2 there is an expanded definition of telecommunications apparatus; but, as drafted, this appears only to refer to such items as wires, cables, tubes, pipes and poles from which apparatus can be slung, hung or submerged. The amendment that I suggest would include the word "testing", and would therefore include test equipment. If I am right in saying that nowhere else is test equipment covered, it means that this class of equipment need not be approved by any central authority before being introduced into the system.
Most modern test systems are tested in a monitoring mode; that is to say, the equipment is permanently attached to the line and it measures and records the live traffic going over the system. But if that test equipment is of a poor quality or poor manufacture, or develops faults within itself, it can introduce serious errors into the system and even cause a complete breakdown. If these two words in the amendment are inserted, I hope that that will cure that problem and will require that all test equipment must be approved before being introduced into a system.
While I believe that this amendment is important to the safety of telecommunications systems, I should mention that there are some 300 or 400 types of test equipment produced by four or five manufacturers and, therefore, the job of inspecting and testing these is by no means inconsiderable. Clause 24 mentions meters, but from my reading of it this appears to cover only customer-charging meters or—the noble Countess, Lady Mar, will correct me if I am wrong—what are called "tollmeters" by the Post Office, and I do not think that the question of test equipment will fit into this clause. I therefore recommend this amendment to your Lordships. I beg to move.
Lord Bruce of Donington: It occurs to us that this may be a matter of interpretation of the word "running", and I think that the word "running" is nowhere defined in the Bill. But I do not see how you could run a telecommunications system without at some point making use of test equipment, and therefore I think that the existing wording covers the point. That is the only observation that we have to offer.
Lord Lyell: We are very grateful to my noble friend Lord Glanusk for filling us in on some very interesting technical problems and details, and he moved his amendment succinctly and with great clarity. My noble friend mentioed the term "telecommunications apparatus." I assure him and your Lordships that telecommunications apparatus is covered by the definition in paragraph 1 not only when a system is being run to provide a service to customers but also

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when it is undergoing testing and when the apparatus is being installed and the system itself cannot be either run or tested.
Under Clause 10 of the Bill the provisions of the telecommunications code contained in Schedule 2 to the Bill have effect when they are applied to a particular person by a licence authorising that person to run a telecommunications system. When a person, like the prospective operator of a local cable telecommunications system, is granted a licence he will not actually be running any system: he can do this only after he gets his licence and he will have to do several things before he can actually run a system. For example, he will have to install apparatus in his studio and in the streets: then he will have to connect it to individual customers' premises, and then he will have to test it satisfactorily before he provides a service.
The code is drafted to assist all these processes of installation, testing and running. Paragraph 9, for example, authorises a person to whom the code is applied to execute street works so that he can install telecommunications apparatus like ducts and cables under the highway, which he will have to do well before he actually provides a service. Because the code is applied to a person, the definition of "telecommunications apparatus" in paragraph 1 applies to such ducts and cables during the installation phase when the system is not being run at all.
The actual process of testing is embraced within the words "running of a telecommunications system". Testing involves the sending of sounds, visual images or signals over the system to check that they are received correctly and that the apparatus functions correctly. This sending and receiving must involve the conveyance of messages, and hence the operation or running of the system. I stress to my noble friend that the system cannot be tested without, under the definition that is provided in paragraph 1, being actually run.
I would go a little further and stress that apparatus which is specially designed for test purposes is covered by the definition of "telecommunications apparatus", which was referred to by my noble friend, in clause 4(2) of the Bill. It is also included in the definitions to be found in paragraph 1 which we are discussing now, since it is apparatus constructed or adapted for use in transmitting or receiving signals sent by means of this telecommunications system. I hope that explanation has been sufficient to set my noble friend's fears at rest.
Lord Glanusk: I am not convinced by what my noble friend has said, but in view of the fact that it is in the interests of my company that test equipment should not have to obtain approval I shall gladly withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 85:
Page 89, line 38, at end insert—
("Protection of the physical environment
1A. All telecommunication apparatus under this code shall be planned, installed, maintained or altered having regard to the need for protecting the physical environment and this shall not be avoided solely by the payment of compensation to any person claiming to be affected.").
The noble Lord said: There are two elements in this amendment. The first part attempts to write into the telecommunications code the need to protect the physical environment which I tried, by means of an earlier amendment, to define more precisely—and to define not in totally new words but in words which, as in Clause 10(4)(a), come from the Countryside Act 1968. The second part of the amendment is designed to ensure that it is not possible for a deal to be done between an operator and an owner or occupier under which the owner or occupier, or both, are bought out, leaving the damage to the environment for successive generations. It would he a valuable addition to the protection of the physical environment if that kind of buy-out of what, over the years and centuries, have been public rights were to be prohibited. I beg to move.
Lord Glenarthur: Certainly there must be clear and adequate safeguards to protect the environment in the context of telecommunications development; but we believe that those safeguards are best provided by means of licence conditions constructed under the general powers of Clause 10 rather than by limitations in the code itself. The code is designed to replace the Telegraph Acts. We do not think that the case has been made for a change of approach of the kind which the amendment proposes.
What the amendment tries to do is to introduce a statutory duty which would require all telecommunication apparatus installed under the code to be installed having regard to the need for protecting the physical environment. This is certainly not a precisely worded duty. Even as it is worded, it would open up the possibility of a considerable amount of vexatious litigation by those with, perhaps, questionable motives who might wish to frustrate the activities of telecommunications operators. It also introduces the possibility of a clash of objectives when, for example, the court, under paragraph 5 of the code, has to consider whether, at the operator's request, the agreement of a particular person to the installation of apparatus should be dispensed with. The amendment makes no attempt, as far as I can see, to reconcile the proposed new statutory duty with the principle upon which the code is based and to which the court is required to have regard; namely, that no person should unreasonaby be denied access to a telecommunications system.
Our view is that while this amendment is undoubtedly well intentioned, its consequences perhaps have not been fully thought through. I hope that the noble Lord will therefore agree to withdraw it. Having said that, I can give an undertaking that we are receptive to proposals for safeguarding the environment through the mechanisms which I previously described.
Lord McIntosh of Haringey: It would be helpful if the Government were to go slightly further and say that they are sympathetic towards the objective of securing that damage to the environment is not occasioned by a deal between an operator and an owner or occupier to buy out the rights. That is the second part of the amendment. It would be helpful if the Government were to say that they would look at

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whether this could be incorporated in licences, as appropriate—if that is the way the Government wish to deal with the matter.
Lord Glenarthur: I think that this point is already met. I should like to study what the noble Lord has
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said and to comment upon it at a later date, perhaps in writing. As far as I am aware, the point is covered. If it is not, I shall come back to the noble Lord.
Lord McIntosh of Haringey: I am grateful to the noble Lord. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
9.20 p.m.
Lord Howard of Henderskelfe Lord Howard of Henderskelfe moved Amendment No. 85A:
Page 90, line 14, leave out ("sub-paragraph (4)") and insert ("sub-paragraphs (4), (4A) and (4B) ").
The noble Lord said: I beg to move Amendment No. 85A, and, at the same time, Amendment No. 85B. Amendment No. 85A is purely a paving amendment for No. 85B.
Amendment No. 85B: Page 90, line 40, at end insert—
("(4A) A right falling within sub-paragraph (1) above shall not have effect so as to authorise an telecommunications apparatus to be installed, or kept installed, in, on or over any land in one or more of the under-mentioned classes unless the owner of the freehold estate in that land and every person who is (otherwise than as mortgagee) a lessee of the land is bound by his agreement that his interest in the land should be bound by the right except where the right is required to provide a telecommunications service to and only to the occupier of that land—

(a) agricultural land;

(b) land which is part of the countryside within the meaning of the Countryside Act 1968 and the Wildlife and Countryside Act 1981;

(c) land in a National Park as defined in section 114 of the National Parks and Access to the Countryside Act 1949;

(d) land in an area of outstanding natural beauty designated under section 87 of the National Parks and Access to the Countryside Act 1949;

(e) land which is the subject of a management agreement under sections 4(5), 7(3) and 45 of the Countryside Act 1968;

(f) land which is the subject of a mangement agreement under section 39 of the Wildlife and Countryside Act 1981;

(g) land held by the National Trust inalienably under section 21 of the National Trust Act 1907 or section 8 of the National Trust Act 1939;

(h) land the subject of agreements or covenants with the National Trust enforceable under section 8 of the National Trust Act 1937;

(i) green belt land as defined in section 2 of the Green Belt (London and Home Counties) Act 1938.

(4B) The agreement of the occupier of any land not falling within one or more of the classes specified in sub-paragraph (4A) above shall not have effect under sub-paragraph (2) above unless the operator has not less than four weeks prior to the entering into of such agreement given notice in writing to the owner of the freehold estate in, and to every person who is (other than as mortgagee) a lessee of, that land of what is proposed, has afforded such owner and every such other person not less than three weeks from receipt of such notice to make representations to the operator and has taken such representations into consideration or unless the right is required to provide a telecommunication service to and only to the occupier of that land.").
In moving these amendments I make no apology for the fact that I suspect it may take a little time. This is such a departure from the practice which has grown up over the years in relation to wayleaves and the compulsory acquisition of wayleaves of all kinds that I would be absolutely staggered at its introduction by a Conservative Government had I not long since ceased to be astonished at any action of any Government.
The main amendment which I am putting forward for your Lordships' attention is in two parts; I will come to the reason for that later. Noble Lords will also notice that it is written in extremely obscure language. There is a perfectly good reason for that. It follows the amendment which was introduced by the Government themselves in another place to Schedule 2, paragraph 2(4). It tries to follow exactly the same wording. If in endeavouring to follow this somewhat obscure wording we have somehow not quite got it right, I shall be only too delighted, with Government help, to get it exactly right.
There are many lawyers in your Lordships' Committee, and I would not presume to try to teach them the law about wayleaves, but I do not think it is possible to understand the background to my amendment and the indignation that I and many others feel at what this Bill is attempting to do unless I say something about that background. I tend normally to live in the present and the future rather than the past, and I do not therefore intend to go as far back as Magna Carta or the Bill of Rights. Suffice it to say that the true needs for compulsory purchase tended to start in the middle of the 19th century, with the growth of public utilities generally, and they culminated, I think, in the Compulsory Purchase Act 1965. This was made to apply in most cases of compulsory acquisition of land or rights over land, and these included wayleaves, the laying of cables, the putting up of poles and all the rest of it. The procedures involved service of a compulsory purchase order on every owner and occupier, the advertisement of it, the right to object, the hearing of objections, the hearing or public inquiry, and the confirmation or otherwise of that order by the Minister, with or without conditions. This applied to new roads, sewage works, power stations and a thousand and one other public works.
If I may be more specific as to the various kinds of public utilities which can avail themselves of compulsory powers, there are electricity wayleaves, for example—and electricity is essential to all of us nowadays. The landowners' consent must be sought, and if it is refused the board must apply to the Minister for a compulsory wayleave. Again, it involves the usual service of notices, the right of objection and so on, and the right to be granted the wayleave conditionally or unconditionally, or indeed, on occasion, refused. Exploring for oil, gas, et cetera, is not, generally speaking, a public utility but a private utility. There, entry had to be negotiated and compulsory rights could be obtained only by application to the High Court under the Mines (Working Facilities and Support) Act, which was indeed a formidable obstacle to those seeking such entry.
Water mains and sewers, on the other hand, had a somewhat easier path which they could follow. When they wanted to enter to construct a water main or sewer, they had to give reasonable notice to every owner and occupier of the land. Even this procedure, which is extremely favourable to those particular undertakers, requires notice to the landlord. In reality of course the various terms have been negotiated with the water authorities who are responsible for sewerage services as well, so that trunk wayleaves are obtained by agreement and not under the powers which they have under the Public Health Act. British Gas has to go through the ordinary procedures that I have already described under the compulsory purchase orders if they cannot obtain their wayleaves by agreement. If the Government wish to do oil pipeline work under the Land Powers (Defence) Act 1958 they are required to serve a draft order on every landowner and occupier, giving them an opportunity for objection and a hearing by the inspector, and so on, before making the order. Under the pipelines Act negotiations, again, have to proceed before the undertakers can apply to the Minister for these acts.
Your Lordships will see that in every case, except water and sewerage, the consent of the owner has to be obtained. In many cases this leads to a long drawn-out procedure. Therefore, just as with water mains and sewers, there is an agreed procedure which, I make no apology for saying, was negotiated by the CLA, of which I was at that time chairman of the legal and planning committee. Negotiations were undertaken with all these authorities and undertakers so that they all agreed standard practices and standard payments whereby they could go onto the land. They could get quick possession and do the work quickly without going through any of the rigmarole which had hitherto possibly obstructed them.
What is happening now? What is to happen under this Bill? Those procedures are to be entirely forgotten. The consent of the landowner is no longer necessary, with the usual safeguards which I have already described. The Bill allows private operators, not public undertakers, to by-pass landowners entirely if they do not happen to be in occupation of the land in question and obtain the necessary rights from the occupier, for the time being, without even consultation or any notice to the landowner. In fact, it is putting telecommunication operators and cable operators in a unique position which is more favourable and which seems to say that telephones and cables of whatever kind, whether for inter-active use, entertainment, or whatever, are more important than electricity, gas, water or sewerage services. Can this really be so? Can the Government truly say that they believe in the interests of those who own property and then proceed in this way?
I turn to the amendment itself. I have tried to deal with the different difficulties which occur in the countryside and in towns by separating rural land and urban land. This I have done with sub-paragraph (4A) dealing with rural land, while sub-paragraph (4B) deals, generally speaking, with urban land. There is no evidence of any kind that rural landowners have been obstructive or oppressive or prevented the undertaker, the cable operator—the Post Office as it used to be known, but now British Telecom—from obtaining lines over or under their land. There is some evidence —largely hearsay—in relation to so-called harassment of tenants in towns, in blocks of flats, by Rachman-like landlords who have prevented the tenants from getting the telephones which they wanted. Therefore, I have endeavoured to deal with this in a slightly different manner, whereby I provide for an accelerated process under sub-paragraph (4B). The essential difference between the safeguards which I provide and those which are referred to in other areas of the Bill are that I talk about "his agreement" rather than "an agreement". It is a very important difference in words.
If I seem to be darting slightly from one point to another that is because this is a very complicated matter. When I was speaking to an earlier amendment rather briefly, I said that I had tried to define rural land in a particular kind of way. We have talked first of all about agricultural land; but not all land in the countryside is agricultural land. There are other uses for land in the countryside. There are various kinds of
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ownership of land and of covenants over it. There are various categories of land—land in national parks, areas of outstanding natural beauty, and so on; land which is the subject of the management agreements which I think have been endorsed by all sides of this and the other House as being the best way to cope with some of the worst problems that arise in the countryside and in the protection of the environment.
May I say here that the noble Lord, Lord Gibson, has authorised me to say that my amendment has the full support of the National Trust. Unfortunately, he is not able to be here this evening. He was here last Thursday but of course we spent rather a long time on some of the earlier amendments and did not reach this one.
In this case the wording of the amendment means—although noble Lords may have some difficulty in finding that out—that the laying of lines or the erecting of poles have to he agreed by the owner. The only exception to this is where the line is for the benefit of the occupier alone and is not to serve others. Noble Lords will see that exception provided for:
"unless the right is required to provide a telecommunication service to and only to the occupier of that land".
I think that this is exactly in accordance with the present provisions of all the other forms of wayleave. I see no reason whatsoever why private undertakers should be able to possess draconian powers which far exceed those of the public undertakers. It will not delay the undertakers because, as I have said already, codes of practice have been agreed which will enable speedy resolution of all difficulties.
The greater difficulties which are said to have arisen in towns and which arise from the maze of sub- and head-lessees and other people who operate with town property are dealt with under sub-paragraph (4B). This provides that notice in writing be given to the owners. That ties in with paragraph 24(4) of Schedule 2, where it is not practicable to trace the owner of the land. You therefore, as it were, hammer up a notice and say, "Look, we are going to come in unless you tell us who you are". Of course, this is paraphrasing slightly what it actually says in the Bill. However, I think that it conveys my meaning.
I consider that it is of immense importance that a matter which was not discussed at all in the House of Commons and which was subjected to the fall of the guillotine—I do not know at what hour of the night that happened—should now be put right in your Lordships' Committee. Perhaps I shall be given some reason—though I cannot think that there can be any—why this extra power should be introduced at this time. The noble and learned Lord the Lord Chancellor, who sits with such distinction on the Woolsack, not so long ago gave on television a lecture which was addressed to the whole nation, in which he talked about an elective dictatorship. If we go on in this kind of way, whichever side of the Chamber this kind of draconian power comes from, we shall be well on our way to an elective dictatorship and to proving once more that we have very nearly reached it.
I beseech the Government to think again and to come back with some better protection, some better

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code which incorporates also all the thoughts about the environment which have been put before us by the noble Lord, Lord McIntosh of Haringey, and which I have tried to cover in my particularised definition of land of this character. If I have spoken passionately, it has been because I do not feel that there can be many people on either side of the Committee who really believe that this is a good new provision, a good way to start off what could be one of the most exciting technological developments of what remains of my lifetime. I beg to move.
9.36 p.m.
The Deputy Chairman of Committees (Earl Carthcart): It is not permissible for the noble Lord to move Amendments Nos. 85A and 85B en bloc, as there is an amendment, in the name of the noble Lord, Lord Airedale, to Amendment No. 85B, but of course the noble Lord can speak to both Amendments Nos. 85A and 85B. I must therefore say that the amendment proposed is Amendment No. 85A.
Lord Middleton: The reason which until now the Government have given for presenting to private operators new, and as the noble Lord, Lord Howard, has said, quite exceptional rights over land is that they want to simplify and speed up the procedures for obtaining telecommunications services. That is an intention that we would all applaud, but—and I agree with the noble Lord, Lord Howard—the method proposed in the Bill is heavy-handed and I am rather surprised that the present Government should be advocating it. I therefore support the noble Lord, Lord Howard, in what he is seeking to achieve by his amendment.
Like the noble Lord, I am not aware of any evidence that the normal procedures for utility undertakings in the countryside lead to either obstruction or delay. These procedures are well understood by both public undertakers and private companies, and wayleaves and other agreements are arrived at in reasonable time. So far as rural land is concerned, where, as a rule, ownership is easily determined, I see no reason why there should not be adopted by private telecommunications operators procedures similar to those laid down under the Telegraph Acts. As the noble Lord has reminded us, they would be similar to those now used by public bodies and private companies, virtually all of which must obtain the owner's consent in order to do works.
In regard to urban land, it seems to me perfectly reasonable, and only right, that owners should he given the chance to make representations, and then all the operator need do, under the proposed new subparagraph (4B), would be to take such representations into consideration.
If an owner could not be traced either out in the country or in the town, the answer is already provided by paragraph 24(4) of Schedule 2 to the Bill as it now stands. That procedure would be applied and no undue delay need take place. The Government want (who would disagree with them?) to cut out the delays
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experienced by individual occupiers when they wish to be connected. Such applicants are catered for by these amendments. In their case, as I read it, consultation or consent by an owner would not be required.
The noble Lord, Lord Howard, has raised an important point of principle. As he said, it is a point that could not be argued in another place. I hope very much that the Government will give further thought to it in the same spirit with which they have already improved the compensation provisions.
Lady Saltoun: While accepting that difficulties have sometimes arisen in urban areas as regards obtaining permission from absentee owners, this is rarely a problem in the country. Merely notifying the owner or the proprietor so that he has a chance to object or possibly make constructive representations is quite another matter. Indeed, in the country, telecommunications operators have often something to gain from consulting the proprietor, who can often draw their attention to facts unknown to many town dwellers—for example, that small trees grow into big trees and that fields contain drains that you cannot see.
But this is by the way. The real point is that it is horrifying—at least it is to me—to find a Government, who, with one hand, are committed to supporting and encouraging private ownership of property (urban property, too), with the other hand writing into the Bill a provision that cuts at the heart of the law protecting the rights of the owners of property. It is totally contrary to the established law of the land. I shall go further. To try to sneak such a revoluntary alteration in the law into a schedule to the Telecommunications Bill is nothing less than a constitutional outrage. I hope that your Lordships will not tolerate it.
I hope that the noble Lord, Lord Glenarthur, will say that at least the Government will reconsider the question and will amend the schedule at Report stage. If he does not do so and if my noble colleague Lord Howard of Henderskelfe decides to press his amendment, I shall most certainly support him.
Viscount Massereene and Ferrard: I should like to strongly support the amendment. There is a difference, as all of us know, between the occupier and the landowner. There might be an occupier—say, a sheep farmer—in a beautiful part of the country, who might not have the same appreciation of the beauty of the countryside as the landowner. The occupier is the only one to be consulted. He would presumably give his consent perfectly easily, whereas the landowner might not. I am surprised that, as the noble Lord, Lord Howard, has said, a Conservative Government have brought in a measure in this Bill to deprive the landowner of an almost sacred right that he has always had.
The procedure that exists at the moment has always been fair. I have dealt with only one or two cases involving public bodies and public utilities. I have always found them extremely fair. I remember one case quite a long time ago when the electricity board was bringing electricity to the Isle of Mull. Its civil engineer was going to bring the pylons up a very

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beautiful loch to a very beautiful glen. I told him that I thought that this was a great pity, quite apart from the fact that, if he took the pylons up to the top of the glen, half of them would be blown down. The board was very reasonable and did not do that. It took the pylons by quite a different route where, as it turned out, there were more consumers. But if that had happened today I would not have had any say at all because some of the land is let and presumably the occupier would not have taken my point of view in the matter.
It is very odd for a Conservative Government not to have the private undertaker (and I do not mean the man who buries people) consult the landowner. After all, the landowners, especially the landowners whose families have owned land for a long time, are extremely concerned about preserving the beauty and wildlife of the countryside.
As the noble Lord, Lord Howard, has given such an excellent explanation of his amendment, I shall not waste your Lordships' time any more. However, I reiterate that I hope that the Government will bring the matter back at Report. In fact, it is not for me to say, but for the noble Lord who moved the amendment. But if the matter does not go to a Division, I hope the Government will take it away and alter it at the Report stage.
Lord Grimond: As this is a matter of some complexity—in fact, complexity worthy of the parliamentary draftsmen—I am not certain that I understand it all even after the lucid explanation from the noble Lord, Lord Howard. But in so far as I do understand it, I strongly recommend that part of it which emphasises that in rural areas landlords still have some rights. They have a long-term interest in the land, and it is only right that they should be consulted. So I merely adopt what has been said by several noble Lords already and support that part of the amendment.
I then pass on with some diffidence to ask one or two rather esoteric questions which I suspect are actually answered in the Bill, but the answers to which I cannot find. I am emboldened to do this by the return of the noble and learned Lord the Lord Advocate to the Government Front Bench. He will be aware that in Shetland and Orkney there is a form of tenure known as "udal", and that an important right of udallers is their ownership of the bottom of the sea between the high and low water marks. Under Schedule 2, paragraph 11, the tide lands are dealt with, but I am not certain that their position is safeguarded, and at some point I should like reassurance from the noble and learned Lord the Lord Advocate.
Secondly, what is the position of feus and feuars? Are those who grant feus to have any rights under the Bill? Thirdly, what about crofters? I imagine that crofters simply count as tenants. But does a crofting landlord have any rights? Has he any right to be consulted, or at least to be notified? I also ask what is the position about the common grazings or the "scattald", as they are known in Shetland, as the noble
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and learned Lord will be well aware. Is there an obligation to notify either the grazing constable or the grazing committee before there is any interference with the land? That is an important matter. There is also the question of peat roads, and so forth, which are of considerable importance in many parts of Scotland.
Finally, if there are disputes under this Act, why do they go to the sheriff court? There may be a good reason, but I should have thought that in many cases they would more appropriately go to the land court. I follow that not all these questions arise directly out of the amendment, but I understand that your Lordships' rules of order are pretty wide and I have no doubt that the noble and learned Lord the Lord Advocate will he able to deal with these questions extremely quickly. I hope he will give me some answers to them.
9.50 p.m.
Lord Home of the Hirsel: I probably should declare an interest. For countless years I was either a landowner or the chairman of a private land-owning company. In those years I have seen all sorts of dealings with all sorts of public corporations—electricity, gas, coal, oil, trunk roads—many of them seeking wayleaves or facilities for development. As the noble Lord, Lord Howard, has said, until now in every case the landowner was notified and the landowner had the rights which the noble Lord described. Quite often, as was natural, the original proposals made by one of these corporations cut across the development plans for the estate. However, as a matter of practice, over all those years I cannot recall a single case out of dozens in which a settlement was not reached to the satisfaction of the corporation, the landowner and the tenant.
That was a perfectly sensible procedure. Unless the Government can give some very good reasons, I do not see why it should be changed, particularly as it is proposed that a private operator should now he able to by-pass the landowner. The civilized, sensible way in which we proceed in the countryside is really for the corporation—or in this case Telecom—to consult the landowner, for the landowner to consult the tenant, and then for the three to consult together and arrive at a sensible solution. I am bound to say that I shall need a good deal of convincing that the Government's plan is better than what we have already. On the whole, I prefer solid experience to an uncertain future.
Lord Campbell of Alloway: Perhaps I may detain your Lordships for a few brief moments. I rise to support this amendment which enables the occupier to grant rights which bind those with a legal interest in land. It is a novel, substantial departure from existing law and it envisages that an occupier who puts his signature on a printed form presented by the operator will give a right to enter land and execute works.
An occupier may be a mere squatter: he could even be a bare licensee at the will of a lessee, a sub-lessee or a freeholder. One only has to start contemplating the actual circumstances on the ground of what quality an occupier may be to consider how unacceptable it would be for someone in that position to be able to bind anyone with a legal interest. It is wholly essential that before entry those with a legal interest in the

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land—whether leasehold or freehold—should have some opportunity to make representations. An attempt should be made—and this is all that I submit should happen—to serve those with the legal interest. Some suitable machinery should be devised; and only if such an attempt fails should there be resort to this peremptory procedure. Those with a legal interest must he given notice and an opportunity to make representations. I agree with the noble Lord who has already said that an important legal interest is at stake. Is this not another aspect of the Bill where the Executive presumes overmuch?
Baroness Elliot of Harwood: I should like to support this amendment very strongly indeed. I agree with everything that has been said by the noble Lord, Lord Howard, and by the noble Lady, Lady Saltoun. I have had the same kind of experience as my noble friend Lord Home, only on a much smaller scale. I have lived in an area which is very large and wild and in which from time to time electricity, drainage and other services have been proposed. Unless one has had the opportunity of giving advice (let alone anything else) as to the best way in which to do something, it will all have been done extremely badly.
I think that is the safeguard this Bill will have if you put in these amendments. I hope that the Government will realise we are not speaking in any sense of selfishness or of wanting to lord it over anyone. We are speaking in the sense that this is the best way to do it This will be the best way to do it; it will bring the best advice, and the best results. It is nothing short of madness not to incorporate these amendments in the Bill. To me, what is there now is extremely unfortunate, and I never dreamt that a Conservative Government would put forward something so dictatorial and something so out of tune with what we normally feel in the countryside and elsewhere. I support this amendment very strongly indeed.
Lord Northfield: We are all indebted to the noble Lord, Lord Howard of Henderskelfe, for spotting this point in the Bill. I must confess that anyone who follows these matters must be very puzzled by the present drafting of sub-paragraphs (3) and (4) on page 90 of the Bill. I hope that the noble Lord will address himself to this point when he replies, because what the sub-paragraphs seem to say is that the occupier whose consent is needed for these works will not have sufficient authority to give his consent unless he has had an agreement in writing from the landowner that he shall have this authority to give such consents. I have rather convoluted it, but what it seems to say—
Lord Howard of Henderskelfe: With all respect, this is telecommunications apparatus exceeding 15 metres in height—and if I am right, that is about 45 feet. That is a great pylon, in other words. That is what that refers to. There are the words "an agreement" which can be an agreement of the occupier; it is not necessarily an agreement of the owner.
Lord Northfield: I am much obliged. I am with the noble Lord, Lord Howard of Henderskelfe, all the way. All I want to say is that the right of the occupier to give these consents seems to be limited to cases where he has an authorisation of some kind from the
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landlord to possess these powers. What I do not understand is what happens if landlords in general begin to say, "We will now include a clause in all the leases specifically withdrawing such powers from the occupier". In that case the utility concerned, I presume, will have to go to the landowner for his consent if the occupier by his lease is deliberately not allowed to have such powers.
If I am right in my interpretation, this leaves a great hole in this part of the Bill, because it means in cases where landlords begin to safeguard their position—as I very much hope, with the noble Lord, Lord Howard, that they will—the Government will have to do something about the position of the landlord. I find the whole matter extremely confusing, so I think that the amendment of the noble Lord in some form, whether as presently drafted but certainly the spirit of his amendment, must be included in the Bill to get the position as complete as possible right from the beginning.
10 p.m.
Lord Glenarthur: We have certainly heard a powerful defence of the rights of property owners from the noble Lord who moved this amendment, and those who supported him, but no government could be more concerned than this one to defend these rights. But before your Lordships leap to the conclusion that the telecommunications code overlooks or ignores the rights of landowners I ought to explain the background to our proposals. The code is intended to replace and update the Telegraph Acts. I think that it is generally agreed that these are archaic and highly unsatisfactory as the statutory framework for modern telecommunications development, dating as they do hack to 1863. In updating them, the Government had to decide what general principles should govern the installation of telecommunication apparatus at a time when telecommunication services are of increasing importance to all aspects of life.
The conclusion that we reached was that there were two important general principles. One of them was that no person should unreasonably he denied access to a telecommunication system. This is explicitly referred to in the code. The other was that operators should be enabled to provide telecommunication services on request with the minimum of delay. This is implicit in the code and in particular in paragraph 2, which sets out the agreements which are required before an operator can install wire, poles, et cetera, on private land.
Paragraph 2 requires what has become known as occupier only consent. Under its provision the agreement of the occupier is sufficient to give the operator the necessary permission to install his apparatus unless the occupier is merely a short-term tenant with a lease of less than a year. This contrasts with the range of consents required under the Telegraph Acts which extended to the landlord, any superior lessee of the occupier, as well as the occupier himself. Over the years these arrangements have been shown to have a number of serious drawbacks. They failed to recognise the impracticability in many cases of obtaining such a wide range of consents. Perhaps the landlord is abroad, for example. This has served to bring the law into disrepute.

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They also failed to recognise that landlords might use the withholding of their consent as a means of harassing their tenants. They might. But, above all, they have led to unnecessary delay in the provision of services: and with the growing significance of telecommunications in everyday life that has become less and less acceptable. The noble Lord's amendment more than acknowledges the validity of these arguments, for it is only in relation, broadly speaking, to agricultural and rural land that it proposes that the operator should have to seek a wider range of agreement. Even here it acknowledges that where apparatus is placed on land to provide a service only to the occupier of that land, the occupier's consent should be sufficient to confer a right on the operator to install his apparatus.
The telecommunications code itself deals, as the noble Lord made clear in moving his amendment, with the granting of wayleaves. In this context it is true that the principle of occupier-only consent is new; but I suggest that it must be looked at in the context of the telecommunication works which are likely to be carried out using its powers. Comparisons with other legislation can be rather misleading. As far as electricity is concerned this is partly because the relevant legislation dates back almost as far as the Telegraph Acts; but it is also because the physical consequences of installing much electricity transmission equipment—and, for example, pipelines, to which the noble Lord, Lord Howard of Henderskelfe, refers—are far more substantial than in the case of telecommunication equipment. That is why more extensive arrangements are needed to protect those with interests in land. Very little telecommunication apparatus, unlike the gas and electricity apparatus that I mentioned, is longer than a telegraph pole.
Against that background, we have to ask why special arrangements are necessary for the categories of land covered by this amendment. Despite what has been said in support of the amendment, to some extent the noble Lord's case is not that the code fails to safeguard property rights of landlords whose consent is not sought, at least in so far as such rights have a financial aspect. The Government have already admitted that this aspect of the code was not fully worked out in the beginning; but thanks to the assistance in particular of the Royal Institution of Chartered Surveyors, we think that the compensation provisions are now satisfactory.
They will ensure that the landowner whose consent is not sought because he is not in occupation of his land will, when he reoccupies it, be able to require the operator to remove his apparatus, if necessary by going to the court. and be able to have the land restored to its former condition. This means that if, for some reason, the land cannot he restored, the operator will be bound to pay compensation for any loss or damage suffered. If the market value of the landlord's interest diminishes because of the uncertain outcome of and the troubled association with the court procedure to get the apparatus removed, the operator will be required to pay compensation to the amount of the depreciation in value.
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Against this background, it seems that perhaps the real concern behind the amendment—emphasising as it does parts of the country which are national parks or designated as areas of outstanding natural beauty—is the need to ensure that landlords can play their part in protecting the rural environment, both in relation to its visual amenity and in connection with other aspects of the physical environment, by giving operators the benefit of the their long-term knowledge of a particular locality in the way that my noble friend Lord Massereene and Ferrard said.
As I said, the protection of the environment is a matter which we regard as of the highest importance. Indeed, it was one of the considerations that we had in mind when we amended the code so that the full range of consents would be required in relation to large apparatus. But in the light of the noble Lord's remarks and the concern which has been expressed by other members of the Committee, it seems to me that this is something to which we need to give further consideration. I should like briefly to give the Committee some idea of the direction that further consideration might take.
It will be clear from what I have already said that we attach considerable importance to the principle of "occupier only" consent. We are not attracted by the amendment which would substantially undermine one of the foundations upon which the code is based. However, as the noble Lord may be aware, we have begun to explore, with one of the organisations which has made representations on this subject, whether conditions could be devised for inclusion in the licence of code operators which would achieve the key objectives of the amendment. Perhaps I should emphasise that there can be no question of licence conditions introducing additional consent procedures, as it were by the back door. That is a matter for the code itself, but it seems possible that some kind of prior notification procedure could be devised, perhaps along the lines of the prior notification procedure for planning authorities in Part 5 of the draft BT licence. That would enable landlords in certain defined areas to make representations to operators about how apparatus should be installed.
I should emphasise that such a prior notification procedure would not extend to all categories of land as the second part of the amendment proposes. We believe that the objection procedures in paragraph 17 of the code, which provides complainants with recourse to the courts if they wish to have apparatus removed or relocated, already provides a better safeguard for the majority of installations. But as I have indicated in areas where special environmental considerations apply, we think that additional safeguards could be introduced by way of licence conditions. In this connection, I should like to make particular mention of the National Trust and the National Trust for Scotland in connection with whom we now recognise that special safeguards are needed. I shall be returning to this subject again in connection with Amendments Nos. 88 and 88B. But I say now that we think that a combination of licence conditions of the kind I described, coupled with an amended paragraph 8 of the code, will meet the very justifiable concerns.

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I am the first to understand and accept the force of the arguments which have been put to me this evening. But I would not wish to give any more precise undertakings at this stage other than the way I have described, since the whole matter would need to be discussed further with interested parties. But on the basis that the Government were willing to adopt an approach of the kind that I have described, and with the explanations that I have given in describing the way the system will work under Schedule 2, I hope that the noble Lord will see tit not to press his amendment.
Lord Northfield: Before the noble Lord sits down, can he answer my question about what happens under sub-paragraph (3) if landlords begin to say in leases that they specifically withdraw from the occupier the right to give these consents?
Lord Glenarthur: I am afraid that I cannot answer that particular point at the moment. I shall certainly find out and let the noble Lord know.
Lord Howard of Henderskelfe: May I be of some assistance to the noble Lord? I think that he will find that the majority of leases already include a prohibition against the occupier granting a wayleave without the landlord's consent. Often it says after that, "which shall not be unreasonably withheld". It is very nearly standard in most leases. I see a lot of noble Lords nodding at what I have said. I hope that that in some measure answers the question. I have to try to deal with it when we come to a later amendment.
Meanwhile, the Minister has held out hope of some amendment. His speech was certainly very much more conciliatory in its tone than the speech that was made in another place on Second Reading. I should like to read very carefully indeed what he has said before I decide to return to this matter later. I cannot accept that we can move on to a new era of occupiers-only consent. If that is to be the new role, then I feel that at a later stage we still must march into the Lobbies. But, because I do not feel that I would wish to do so tonight until I have first had an opportunity of reading what the noble Lord has said tonight and, secondly, of seeing what the Government propose in the future,. I would wish to seek leave to withdraw the amendment.
Lord Airedale: Before the noble Lord withdraws his amendment, although we have been discussing Amendments Nos. 85A and 85B together, we are technically still only on No. 85A. When Amendment No. 85B is called, if the noble Lord, Lord Howard, will be so kind as to move it formally, that will let in my following amendment. Otherwise, I shall be frustrated.
Amendment No. 85A, by leave, withdrawn.
Lord Howard of Henderskelfe Lord Howard of Henderskelfe moved Amendment No. 85B:
[Printed earlier: col. 553.]
The noble Lord said: I beg formally to move Amendment No. 85B, which stands in my name. I do not propose to speak to it.
10.13 p.m.
Lord Airedale Lord Airedale moved, as an amendment to Amendment No. 85B, Amendment No. 85BA:
At end insert—
(" (4C The agreement of the occupier of any land falling within headings (b),(c),(d),(e)and (f) of sub-paragraph (4A) above shall not have effect under sub-paragraph (2) above unless the operator has not less than four weeks prior to the entering into of such agreement given notice in writing to the Countryside Commission or the Countryside Commission for Scotland, as the case may be, of what is proposed, has afforded such Commission not less than three weeks from receipt of such notice to make representations to the operator and has taken such representations into consideration or unless the right is required to provide a telecommunication service to and only to the occupier of that land.")
The noble Lord said: I am happy to say that my amendment does not in any way interfere with the previous amendment. It raises a different point. It is only associated with the previous amendment because I have taken the opportunity to adopt some of the happy wording of the previous amendment. The Countryside Commission is charged with looking after the physical environment of the land under its control. That land is the land comprised in paragraphs (b) to (f) of the previous amendment.
I should have thought that it almost went without saying that if something is going to be erected affecting the physical environment of Countryside Commission land, the Countryside Commission should at least be told what it is proposed to do. I listened with great interest to the Minister's reply to the first amendment to Schedule 2, in which he said, for instance, that there would be permission for the erection of certain poles and wires so as not to overload the planning controls system.
There is a great difference between putting a line of poles and wires upon the horizon and siting them out of sight below the skyline. I should have thought the Countryside Commission would be more sensitive to and aware of a problem of this kind than would British Telecom. Then the Minister said that in most cases, of course, it is compulsory to put telephone cables underground; but there are exceptions, and I suppose that one would he open moorland, where it would probably be far too expensive to put the cables underground.
Then the Minister relied very much upon the planning control legislation. My observation on that is that planning control is local, and inevitably one will get situations where the same problem is dealt with in one way by one local authority and in another way by another local authority. But if you have the Countryside Commission having their say in the matter, you will tend to get uniformity in dealing with similar problems nationwide.
My only fear is that I have perhaps not drafted this amendment strongly enough. It says only that the Countryside Commission must be given notice, and it enables them to make representations; and it says that the representations must he taken into consideration. But that is all. It may well be that your Lordships will think that something stronger is required and that the Countryside Commission's permission ought to be required, with possibly an appeal to the Secretary of State in the event of a deadlock between British Telecom and the Countryside Commission. However,

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I should have thought that this amendment, so far as it goes, was desirable. I would most gladly support a stronger amendment at the next stage of the Bill, but in the meantime I would hope that your Lordships might think that this amendment is at least desirable, and I beg to move.
Lord Glenarthur: The Government have made it clear that the conditions in the BT licence represent a minimum standard to which other licences applying powers under the telecommunications code will conform. There has to be full public consultation before other licences are granted, and it will be possible to deal with matters of the kind covered by this amendment in that context.
Turning to the BT draft licence, the Government do not think it is necessary to extend the notification procedure in Condition 2 of Part 5 so widely as to cover all the areas dealt with in this amendment, or that the Countryside Commission itself should be notified as well as the local planning authority in the case of countryside consisting of a national park or an area of outstanding natural beauty. Furthermore, the Countryside Commission have indicated that in any case they would not have the resources to vet proposals for the installation of apparatus.
I therefore hope that the noble Lord will accept that BT's draft licence and, by extension, all licences in future providing for consultation with local planning authorities on the installation of overhead apparatus in national parks and areas of outstanding natural beauty go as far as it is practicable to go in requiring operators to consult the relevant authority before installing apparatus in the countryside in general. I hope that the noble Lord will see fit to withdraw his amendment.
Lord Airedale: I am sorry to hear that the Countryside Commission do not have the financial resources. That seems to be a sad state of affairs. In that event, I suppose it is not much good pressing this amendment, and I have not had what one might call overwhelming support for it. So I beg leave to withdraw the amendment.
Amendment to the amendment, by leave, withdrawn.
The Deputy Chairman of Committees: May I have the wishes of the noble Lord, Lord Howard, on Amendment No. 85B?
Lord Howard of Henderskelfe: Having withdrawn my paving Amendment No. 85A, I think it would be impossible for me to divide on No. 85B. I therefore beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Lyell Lord Lyell moved Amendment No. 85C:
Page 92, line 47, leave out ("paragraph 8(b)") and insert ("subparagraph (8A)")
The noble Lord said: With the permission of the Committee, I should like to speak also to Amendments Nos. 85D, 85E. 85F, 85G, 85H, 85J, 85K and 85L, which are all in the name of my noble
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friend Lord Cockfield. They are all interconnected and are all concerned with paragraph 4 of Schedule 2.
Amendment No. 85D:
Page 93, line 16, at end insert (": and sections 2 and 4 of the Land Compensation Act 1961 (procedure and costs before Lands Tribunal) shall apply, with the necessary modifications, in relation to any such determination.")
Amendment No. 85E:
Page 93, line 18, leave out from ("be") to ("becomes") in line 19 and insert ("made by giving the operator notice of the claim and specifying in that notice particulars of—

(a) the land in respect of which the claim is made:

(b) the claimant's interest in the land and, so far as known to the claimant, any other interests in the land:

(c) the right or variation in respect of which the claim is made: and

(d) the amount of the compensation claimed:

and such a claim shall be capable of being made at any time before the claimant")
Amendment No. 85F:
Page 93, line 26, at end insert—
("( ) Without prejudice to the powers of the Lands Tribunal in respect of the costs of any proceedings before the Tribunal by virtue of this paragraph, where compensation is payable under subparagraph (4) above there shall also be payable, by the operator to the claimant, any reasonable valuation or legal expenses incurred by the claimant for the purposes of the preparation and prosecution of his claim for that compensation.")
Amendment No. 85G:
Page 93, line 31, at end insert—
("( ) In the application of this paragraph to Scotland—

(a) for any reference to the Lands Tribunal there is substituted a reference to the Lands Tribunal for Scotland and for any reference to costs there is substituted a reference to expenses:

(b) for the reference in sub-paragraph (6) above to sections 2 and 4 of the Land Compensation Act 1961 there is substituted a reference to sections 9 and 11 of the Land Compensation (Scotland) Act 1963:

(c) for the reference in sub-paragraph (8) above to section 5 of the Land Compensation Act 1961 there is substituted a reference to section 12 of the Land Compensation (Scotland) Act 1963;

(d) for the reference in sub-paragraph (9) above to sub-sections (1) to (3) of section 10 of the Land Compensation Act 1973 there is substituted a reference to subsections (1) and (2) of section 10 of the Land Compensation (Scotland) Act 1973")

Amendment No. 85H:
Page 93, line 33, leave out from ("for") to ("to") and insert ("any reference")
Amendment No. 85J:
Page 93, line 36, leave out from ("the") to ("5") and insert ("references in sub-paragraphs (6) and (8) above to sections2, 4 and")
Amendment No. 85K:
Page 93, line 37, leave out from ("there") to ("6") in line 38 and insert ("are substituted references to Articles 4, 5 and")
Amendment No. 85L:
Page 93, line 39, after ("1982") insert (". respectively")
All these amendments arise from paragraph 4(4), which was one of the improvements in the compensation provisions of the code which were made at Report stage in another place. The basic objective of paragraph 4(4) is to enable landlords whose agreement is not sought to the installation of apparatus to telecommunications obtain compensation for any diminution in the value of their interest in the land which may occur because, in order to get such apparatus removed when they come back into occupation, they may have to take the telecommunications operator to court.
Three of the amendments to which I am speaking—Nos. 85C, 85D and 85E—are designed to introduce the necessary procedures for making claims

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under paragraph 4(4), and to ensure that the existing arrangements by which the Lands Tribunal hears cases are carried over into the telecommunications code. These amendments are based on the corresponding provisions in the Land Compensation Acts of 1961 and 1973, which present the same situation.
Amendment No. 85F is related to the other three to which I have spoken. It ensures that, when the Lands Tribunal is assessing compensation in relation to paragraph 4(4), account is taken of any valuation or legal expenses which are paid by the operator to the claimant. The rest of the amendments—Nos. 85G, 85H, 85K, 85J and 85L—are consequential and are to achieve the same objectives. They are amendments to Scottish and Northern Irish enactments. These amendments involve no real issue of policy. I hope that, with that brief explanation, the Committee may see fit to accept them. I beg to move.
On Question, amendment agreed to.
10.23 p.m.
The Earl of Kinnoull The Earl of Kinnoull moved Amendment No. 85CA:
Page 93, line 12, at end insert—
("(5A) Where—

(a) a person would as the owner of a relevant interest in land subject to which a right is conferred or varied be entitled under sub-paragraph (4) above to compensation for depreciation in the value of that relevant interest if there were any such depreciation,

(b) that person is the owner of any interest in other land, and

(c) the value of his interest in that other land is depreciated by reason of the conferment or variation of the right or of anything otherwise injuriously affecting that other land by the exercise of the right.

then, whether or not any compensation is payable under subparagraph (4), the operator shall pay to that person compensation equal to the amount of the depreciation in the value of his interest in the other land.")
The noble Earl said: I beg to move this amendment, and with it I should like to speak to Amendments Nos. 85CB, 85EA, 85FA and 86CB, all of which are consequential.
Amendment No. 85CB: Page 93, line 14, leave out ("subparagraph (4)") and insert ("sub-paragraphs (4) and (5A)")
Amenthnent No. 85EA: Page 93, line 22, leave out ("subparagraph (4)") and insert ("sub-paragraphs (4) and (5A)")
Amendment No. 85FA: Page 93, line 29, leave out ("subparagraph (4)") and insert ("sub-paragraphs (4) and (5A)")
Amendment No. 86CB: Page 95, line 31, at end insert—
("( ) In determining what amount shall be specified in a term of an order under paragraph 5 above the court shall take into account any compensation paid under paragraph 4(5A) above.")
My noble friend praised the Royal Institution of Chartered Surveyors earlier, when he said that helpful discussions and consultations over this complicated code are taking place between the Government and the institution. But I should say at once to my noble friend that I do not think the institution is completely happy with the code as it at present stands. Indeed, this complicated little amendment has been drafted by the institution.
It is a complicated subject which we are taking at a late hour, and the position is made more complicated because I have lost the brief. But, as I understand it, the amendment seeks to provide compensation for injurious affection. This is a case where land has been
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affected but not actually acquired by the body which has built apparatus on the land. A typical example is a house with a meadow in one ownership, and along comes this body and builds a large apparatus on the meadow in front of the house. The question is whether there should be a claim for injurious affection or depreciation of the value of the house which has not been acquired. This is a common claim under the rules of compensation. It is a common claim under the other statutory bodies which the noble Lord, Lord Howard of Henderskelfe, listed some time ago, and I hope that it will be included, if it is not already included, in this code. I beg to move.
Lord Lyell: In reply to my noble friend's excellent and succinct summing up of the purpose of his amendments, the Government see the purpose of the amendments as being to confer on the owner of an interest in land—perhaps the meadow to which my noble friend referred—upon which telecommunication apparatus is installed under the code a right to compensation which will extend any injurious affection to any interest which he happens to have in any neighbouring land. If your Lordships were to look at the code they would find "injurious affection" mentioned. I am told that in legal terms it means loss or damage suffered by the owner of an interest in land as a direct consequence of the exercise of powers of compulsory acquisition for the execution and use of duly authorised works.
The amendment would give to the owner of an interest in the land on which the apparatus is installed an extended right to compensation—a right extended in this way: to cover the damage to his interest in the neighbouring land. This would be a right closely akin to that which is conferred by Section 7 of the Compulsory Purchase Act 1965 upon owners whose land or interest is taken away from them. By these provisions they can claim under that section for injurious affection to their interest in the neighbouring land as well as for the loss of the land which is taken away.
I have to say to my noble friend and to the Committee that the Government have given careful and, I stress, sympathetic consideration to the suggestion that a principle similar to that in Section 7 should be applied in the circumstances of the code, but we are convinced that it would not be right to do so for these reasons. Primarily, the circumstances in the code which we have before us differ from those in Section 7 of the 1965 Act, in that nothing is taken away from the owner of any interest in the land on which the apparatus is installed who is not in occupation. He is entitled to have the land restored to the condition it was in before the installation was made, once he resumes occupation. We find that in paragraph 4(2) (ii). We believe that there is no justification for seeking to give compensation along the lines of that afforded by Section 7 where there has been expropriation.
As regards his interest in the neighbouring land which is injuriously affected, the owner is in the same position under the code as the holder of an interest in that land and he is entitled to compensation under Clause 16(2) which Amendment No. 91KA seeks to restrict. I hope I have not pre-empted my noble friend,

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who mentioned a list of amendments. We believe that Amendment No. 91KA comes into the list which was introduced by my noble friend, so perhaps he will permit me to refer to it.
Clause 16(2), which Amendment No. 91KA seeks to restrict, expressly provides for the compensation under that paragraph to be determined irrespective of his ownership or interest in the land on which the apparatus is installed. This puts him in just as good a position as would be any neighbouring landowner under the 1965 Act whose interest in that land was not held with the land taken.
I am afraid this has been somewhat convoluted. I hope it has gone some way to assuage the worries expressed by my noble friend. I leave it to the Committee and say our case rests, and I hope my noble friend will not insist on his amendment.
The Earl of Kinnoull: I do not intend to insist on it, but I must pick up the points my noble friend makes. He said the case differs from that under Section 17 of the Land Compensation Act, which applies to the statutory authorities. He said it differs because the owner can remove the apparatus as and when he takes possession of the land. I think that could be misleading, for this reason. In practice what would happen is that if the tenant, having given permission for the apparatus, which would cost quite a considerable sum, to be put on that land, then retires and hands over to the owner two years later, say, I cannot believe that any court, when the company applies to it under this Bill, will say to the owner, "It is reasonable for you to take away that apparatus". I think it would say, "It is reasonable for that apparatus to stay".
So we have the strange situation, which in a funny way was covered by the noble Lord, Lord Howard, that the land is blighted and the owner may not receive compensation until he takes possession, which may be one year or may be fifty years. He may die after three years: and his executors will receive no compensation. I think it is a fundamental injustice in what is a very complicated code, particularly when one remembers that one is dealing with a private company and private interest. I do not see any case at all for giving a special advantage, a draconian power, to a private body over a statutory body. There is a sense of panic that this private body should be given these draconian powers where there is no necessity. I withdraw this amendment under protest because of the time of night and the complication of the matter.
Lord Lyell: Before my noble friend withdraws his amendment, could I stress to him and the Committee that, in the scenario he presented, if the court says that the apparatus must stay when the owner re-occupies his land, then compensation must be paid. My noble friend referred to Section 17 (in fact, it is Section 7) of the 1965 Act. I did not stress that if an owner reoccupies his land he is entitled to have the land restored to the condition it was in before the installation was made. My noble friend will find that in the code on page 92, about halfway down. It is in subparagraph (2) of paragraph 4. He will see the words:
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"the operator shall restore the land to its condition before that thing was done."
I think that goes, if not all the way then a good deal of the way to assuage the justified fears expressed by my noble friend. He sought to abbreviate the proceedings, and perhaps I may also.
The Earl of Kinnoull: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 85CB not moved.]
Lord Lyell Lord Lyell moved Amendments Nos. 85D and 85E:
[Printed earlier: col. 568.]
On Question, amendments agreed to.
[Amendment No. 85EA not moved.]
Lord Lyell Lord Lyell moved Amendment No. 85F:
[Printed earlier: col. 568.]
On Question, amendment agreed to.
[Amendment No. 85FA not moved.]
Lord Lyell Lord Lyell moved Amendments Nos. 85G, 85H, 85J. 85K and 85L:
[Printed earlier: col. 568.]
The noble Lord said: I have already spoken to these amendments. They are all formal. I beg to move them en bloc.
On Question, amendments agreed to.
10.35 p.m.
Lord Spens Lord Spens moved Amendment No. 85LA:
Page 94, line 17, after ("circumstances") insert ("(including, where the land concerned is operational land of statutory undertakers, as defined in section 222 of the Town and Country Planning Act 1971, the needs of those statutory undertakers for the purpose of carrying on their undertaking)")
The noble Lord said: I shall be brief. This amendment has been submitted to us by the water authorities. All water authorities are apparently worried about the Bill because they have their own private telecommunications systems and they are afraid that Schedule 2 may put them in a slightly difficult situation. Schedule 2 gives the operator powers to execute works in relation to the installation of telecommunication systems; and, generally speaking, when an operator wishes to execute works on land the agreement of the occupier for the time being of that land is required. However, paragraph 5 contains provisions whereby the need for obtaining such agreement of the occupiers of the land can be dispensed with.
Under the provisions of paragraph 5 the operator may apply to the county court for an order enabling him to execute works and carry out other operations on land without the usual agreements. Paragraph 5(3) provides that:

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"The court shall make an order under this paragraph if, but only if, it is satisfied that any prejudice caused by the order—

(a) is capable of being adequately compensated for by money; or

(b) is outweighed by the benefit accruing from the order to the person whose access to a telecommunication system will he secured by the order."

It is that situation which the water authorities are worried about. They feel that the court should have regard to all the circumstances and to the principle that no person shall unreasonably be denied access to the telecommunication system. They feel that gives a little bias towards the telecommunications people and against the water authorities. Therefore they suggest that on page 94, at line 17, the following be inserted:
"(including, where the land concerned is operational land of statutory undertakers, as defined in section 222 of the Town and Country Planning Act 1971, the needs of those statutory undertakers liar the purpose of carrying on their undertaking)"
That is all that the water authorities require. I beg to move.
Lord Glenarthur: I hope that I can reassure the noble Lord that there is no danger of the powers of the telecommunications code being used in a way which would damage the interests of statutory undertakers such as water authorities by interfering with their activities on their operational land.
I think it will be unusual for telecommunications operators to want to install their apparatus on the operational land of statutory undertakers except in two sets of circumstances: first, where they are, by agreement, providing a service to that undertaking and, second, where they are acting under the power in paragraph 12 of the code to install apparatus across, and for a short distance along, linear obstacles of railways, tramways and canals. In the first case there is no difficulty because the installation takes place on agreed terms. In the second case paragraph 12, subsection (3), specifically provides that the installation must not interfere with the activity being carried out on the land.
The only other possibility, as this amendment recognises, is that an operator might seek to install apparatus across the operational land of a statutory undertaker under a court order, dispensing with the undertaker's agreement. But as the code is currently drafted, the court is required to take into account all of the circumstances of the case.The fact that the land in question is the operational land of a statutory undertaker is clearly one of the circumstances of the case and the court will he bound to consider it.
I suggest therefore that the amendment is unnecessary. But in addition to that, if we were to treat the operational land of statutory undertakers differently from land in general, for the purposes of paragraph 5 of the code, when there is already an adequate safeguard in paragraph 5 for statutory undertakers it would tend to devalue the safeguards that exist for land in general. I hope therefore that the noble Lord will withdraw his amendment.
Lord Spens: I thank the noble Lord the Minister for that reply. I think that I am satisfied by it. Anyway, I shall take it away, look at it and discuss it with the water authorities to see what they think about it. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Kinnoull The Earl of Kinnoull moved Amendment No. 85LB:
Page 94, line 30, at end insert—
("( ) Before making an order under this paragraph the court shall afford to any person whose agreement will be dispensed with by the order or whose interest will be bound by the provisions of the order an opportunity to apply to the court for the terms of the order which may be specified under paragraph 6 below to be determined by the Lands Tribunal and if any such person so applies—

(a) the order may be made by the court and shall take effect on such day as the court may appoint for the purpose of conferring the right or providing that it shall hind an interest in the land whether or not such terms under paragraph 6 have then been determined;

(b) the terms and conditions of the order which may be specified under paragraph 6 below shall be referred to and determined by the Lands Tribunal;

(c) the Lands Tribunal shall have all the powers and duties conferred on the court by paragraph 6 below: and

(d) the terms and conditions determined by the Lands Tribunal shall be deemed to form part of the order made by the court under this paragraph as if they had been determined by the court and shall be enforceable accordingly.")

The noble Earl said: This amendment is fundamentally very important to the Royal Institution of Chartered Surveyors. I know that the institution has had a good deal of correspondence with my noble friend and his department. Under the new code the Lands Tribunal will deal with compensation matters in the final appeal under paragraphs 4 and 16: and yet under paragraph 5, with which we are now dealing and which concerns the court fixing the financial terms where there have been disputes, the county court will in fact be the fixing body.
The institution is concerned because, first of all, the Lands Tribunal is an expert and recognised body in this field, and I do not think that anyone disagrees with that. Secondly, its decisions are given a good deal of publicity in the professional journals and the decisions are given in writing, which I understand would not necessarily be so in the county court. Thirdly, its rulings are made by a a single body. In the view of the professions, that gives a stable sense of judgment. There was a recent case of Clouds Estates v. Southern Electricity Board, where the Lands Tribunal had to fix an award in a case similar to one which might need to be dealt with under this code. If my noble friend does not accept the precise wording of the amendment, I hope that he will give consideration and sympathy to the purpose behind it. I beg to move.
Lord Lyell: My noble friend was correct to point out the relevance of paragraphs 4 and 16 of the code, as well as the relevance of paragraphs 5 and 6. As we are on paragraph 5 now, my noble friend was right in bringing us hack to that particular section of the code. It may appear to be odd in some ways that the Lands Tribunal is given a role in assessing compensation under paragraphs 4 and 16 but not under paragraphs 5 and 6.
I would stress to my noble friend that the relevant parts of paragraphs 4 and 16—and indeed it was paragraph 16 for which I was seeking in my earlier oration about injurious affection to land—are entirely concerned with the question of compensation. In the one case it is compensation that a telecommunications operator is under a duty to pay to a landlord whose

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agreement to the installation of apparatus has not been sought for any depreciation in the value of his interest—that is, the landlord's interest—in certain circumstances. In the other case—that will be paragraph 16—it is compensation for injurious affection to neighbouring land which once again the operator is under a duty to pay. The issue in these two particular cases is quite simply what is the appropriate level of compensation for the injury suffered.
Far wider issues arise in the context of paragraphs 5 and 6 in the code under which the primary decision is whether or not a right to install apparatus on private land should be conferred on the operator despite the opposition of the person with the relevant interest in the land. This must, in the Government's view, be a matter to be decided by a judge in court and not by a tribunal.
The second matter to be determined in such circumstances is the terms and conditions (including terms as to compensation) on which the right is to be exercised. We believe that it is difficult to separate out these issues, and in particular to divorce the question of compensation from the other terms and conditions that will have to be incorporated in a court order. We also believe that it makes for a much more efficient and economical legal process if these matters are dealt with together in one package. It seems to me that this amendment acknowledges the force of those arguments, for it does not seek to split the jurisdiction in all cases, but rather to leave open the option of a reference to the Lands Tribunal where the complainant asks for such a reference.
I think that the essence of my noble friend's argument is that if difficult cases arise, it may be desirable to draw on valuation expertise, and I would acknowledge that there is some force in that. Having considered the matter the Government have concluded that it would be appropriate for the court to have access to relevant valuation expertise so as to assist it (the court) in coming to a conclusion on the terms that are to be included in the order. Therefore I am happy to give my noble friend an undertaking that at Report stage we shall come forward with the necessary amendment to ensure that a county court judge will he able to summon an expert assessor and authorise him to inspect the relevant land and report hack to the court as to the terms that should be included in any order. I think that that would be a significant improvement in the jurisdiction under the code as it stands at present and, moreover, an improvement which would not involve any of the procedural inefficiency associated with a reference in any particular case to the Lands Tribunal. I hope that. in the light of the assurance that I have given my noble friend, he will feel able to withdraw the amendment which he has moved so succinctly.
The Earl of Kinnoull: I am most grateful to my noble friend for his courteous and uplifting reply. I noticed a glow going around the Committee and I saw, too, even a smile on the face of the Chief Whip. On the basis of the assurance that my noble friend has given, I am very happy to beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Glenarthur Lord Glenarthur moved Amendment No. 85M:
Page 94, line 43, after ("on") insert (". under or over")
The noble Lord said: In moving Amendment No. 85M I wish at the same time to speak also to Amendments Nos. 86B, 91D, 91K, 94A and 95A.
Amendment No. 86B: Page 95, line 18, leave out ("suffered") and insert ("sustained").
Amendment No. 91D: Page 101, line 40, leave out ("suffered") and insert ("sustained").
Amendownt No. 91K: Page 103, line 23, leave out ("a puhlic") and insert ("that").
Amendment No. 94A: Page 107, line 24, leave out ("suffered") and insert ("sustained").
Amendment No. 95A: Page 113, line 18, after second ("or) insert ("the application in relation to this code of").
These are all formal drafting amendments, and I need not detain the Committee with them. I beg to move.
On Question, amendment agreed to.
[Amendment No. 86 had been withdrawn frotn the Marshalled List.]
Lord Glenarthur Lord Glenarthur moved Amendment No. 86A:
Page 95, line 16, leave out ("persons from time to time bound by the order") and insert ("that person and persons from time to time bound by virtue of paragraph 3(2) above by the rights to which the agreement relates")
The noble Lord said: In moving this amendment I wish to speak also to Amendment No. 86C:
Amendment No. 86C: Page 95, line 19, leave out ("the rights to which the agreement relates") and insert ("those rights")
These two amendments correct a drafting error in paragraph 6(1)(b) of the telecommunications code. I could explain them at length, but I think that at this time of night I shall merely move them formally. I beg to move.
On Question, amendment agreed to.
Lord Glenarthur Lord Glenarthur moved Amendment No. 86B:
[Printed above.]
On Question, amendment agreed to.
Lord Glenarthur Lord Glenarthur moved Amendment No. 86C:
[Printed above.]
On Question, amendment agreed to.
10.49 p.m.
The Earl of Kinnoull The Earl of Kinnoull moved Amendment No. 86CA:
Page 95, line 20, at end insert ("and persons to be so compensated shall include all persons from time to time being on or using the land with lawful authority.")
The noble Earl said: We are moving along at a good pace here. This is a simple amendment which I know my noble friend will grasp very quickly. As I understand it, basically there is a difference under the code involving on the one hand the rights of an occupier if, for example, he is injured or any of his stock on the land is injured, against the contractor or

577
the company putting in the apparatus. There is a sharp difference between the occupier, who does not have to seek negligence and has an automatic claim, and anyone who might be invited onto his land. For instance, a farmer might invite a fellow farmer to place in a field for a week a valuable herd of Jerseys. During that time they might become entangled in the apparatus and the wires and two might be killed. There is no automatic claim to compensation for that person or his interests.
Equally, if someone invited on to the land by the owner while the work with the apparatus is being carried out is injured, he does not receive an automatic right of compensation. This is a simple point. I hope that my noble friend may be able to accept the principle of the amendment. I beg to move.
Lord Glenarthur: Paragraph 6(1) (b) of the code provides for the court to include, in an order dispensing with the agreement of someone to the installation of apparatus on private land, terms relating to compensation for any loss or damage. As I would have made clear if I had elaborated on Amendment No. 86A, which I have just moved, we intend that persons who are from time to time bound by such an order by virtue of paragraph 2(3) should also be within the scope of this provision. That includes anyone who is the successor in title to the interest of the person or persons whose agreement was dispensed with by the court.
The amendment seeks to go very wide indeed, and includes within the scope of a court order all persons from time to time being on or using the land in question with lawful authority in respect of any loss or damage suffered by them in consequence of the exercise of the rights of the operator. The Government's view is that it is wholly impracticable. How can the court possibly deal with a range of circumstances which might include, let alone Jersey hulls to which my noble friend referred, accidental damage to ramblers using a right of way across the land in question and people playing football on the land with the permission of the landowner?
We must hear in mind that the court may grant a right to an operator to install and maintain his apparatus on a particular piece of land for as long as 25 years or more. I suggest that it would be quite impracticable for a court order to be able to provide for compensation to be paid to all persons who may lawfully be on or use the land over this period of time for any loss or damage they may suffer as a result of the exercise of the right of the operator. The only damage such people will suffer will be as a result of negligence on the part of the operator—for example, failure to properly fill in a trench. If this happens, they can sue the operator, or the operator's contractor, for his negligence under common law. That seems to me to be the appropriate remedy.
I hope therefore that my noble friend will withdraw the amendment.
The Earl of Kinnoull: My noble friend says that the amendment is slightly impracticable and refers to ramblers going over the land being injured. That misses the point. If an owner invites someone on to his
578
land and while that person is on the land he is injured, he would not be covered. Yet the owner would be covered if he suffered a similar accident. That is more restricting than the suggestion of my noble friend concerning ramblers. To be honest, I consider that it is very late to be discussing this matter. Perhaps we may look at it together. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 86CB not moved.]
The Deputy Chairman of Committees (Lord Murton of Lindisfarne): I understand that Amendment No. 87 falls and is not moved.
Lord McIntosh of Haringey: No. I do not wish to detain the Committee. I did say at the time that I was speaking to this amendment but not necessarily that I should not be moving it.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 87:
[Printed earlier: col. 535.]
The noble Lord said: The noble Lord, Lord Glenarthur, in response to a previous amendment of mine, talked about the potential conflict between the courts and the conditions that we propose should be put into the telecommunications code. I do not think that that objection can apply to this amendment. It simply adds to the conditions that can be taken into account by the court the condition that an operator can apply to the court for a notice to be set aside on the ground that he is put in an intolerable position: that to afford a potential subscriber access to an operator's system would cause undue damage to the physical environment. This is a just recognition of the kind of conflict of interest that will inevitably be encountered by an operator. It seems to us to be a reasonable addition to those matters that fall to be considered by the court under the conditions of the telecommunications code. I beg to move.
Lord Glenarthur: Paragraph 7 of the code enables a potential subscriber to give notice to an operator requiring him to take certain steps to afford the potential subscriber access to his system. The paragraph also enables the operator to apply to the court to have such a notice set aside on certain specified grounds. This amendment tries to add to those specified grounds that the works necessary to afford the potential subscriber access to the operator's system would cause undue damage to the physical environment.
I have already explained how we see licence conditions operating to protect the physical environment. I have no difficulty with the general proposition that undue damage to the physical environment should, if' possible, he avoided. The difficulty is in providing a meaningful description of what undue damage is. The Government's suggested approach overcomes this kind of problem to a very large extent because it begins by asking questions, such as: in what circumstances is damage likely to be done, or what specific aspects of the environment need special

579
protection? Even that does not solve all the problems, but it avoids the difficulty of very vague statutory tests of the kind suggested here. And in view of the licence conditions we propose to include in the licences of BT and other operators, I would further argue that this amendment is unnecessary.
But I am also concerned about another aspect of this amendment, in that it would appear to provide a very wide subjective test on the basis of which an operator might try to escape obligations in his licence to provide particular services, for example, to rural areas, unless it is impracticable or not reasonably practicable. In view of the assurances the Government have given on this point, I hope that the noble Lord will see fit to withdraw this amendment, which could have potentially harmful effects.
Lord McIntosh of Haringey: I think that the Minister is greatly exaggerating the potentially harmful effects. This is only one possible way in which the operator may apply to the court to have a notice set aside. It is no more than that. It is simply widening the area of possible consideration by the court. But I do realise that the Government have rejected the basic argument, which is that the telecommunications code is the place for this type of environmental protection, and in the light of the necessity to come back to that at the Report stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Lyell Lord Lyell moved Amendments Nos. 87A and 87B:
Page 96, line 46, after ("8") insert ("(1)").
Page 97, line 5, leave out paragraph (b).
The noble Lord said: I beg to move Amendments Nos. 87A and 87B, and I am sure it will be for the convenience of the Committee if I also speak to Amendment No. 88A.
Amendment No. 88.A: Page 97, line 13, at end insert—
("(2) Where any obligation is to any extent unenforceable by virtue of sub-paragraph (1) above, that obligation shall, to that extent, be disregarded for the purposes of assessing the amount of any compensation payable under any provision of this code.")
All three amendments are concerned with paragraph 8 of the code, which your Lordships will find is entitled rather grandly:
"Prohibition on restrictions on giving required agreement".
I should add that Amendment Nos. 87A and 87B are paving amendments for Amendment No. 88A, which is the main amendment about which I should like to speak.
Amendment No. 88A replaces the old paragraph 8(b) with a new sub-paragraph (2) and is designed to remove an obscurity in the drafting. I could go on about the breaching of a covenant in a tenancy agreement, but possibly at this late hour your Lordships might allow me to beg to move Amendments Nos. 87A and 87B together. If any noble Lord wishes a more detailed explanation, I shall willingly give one.
On Question, amendments agreed to.
11 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 88:
[Printed earlier: col. 535.]
The noble Lord said: In view of what I said on a previous amendment. I think that I can content myself by asking the Government to give me some indication of how covenants with the National Trust, the National Trust for Scotland, local authorities or other bodies for the protection of the physical environment are to be protected under the proposed legislation. I beg to move.
Lord Glenarthur: Amendment No. 88, which the noble Lord, Lord McIntosh, has proposed, is related to Amendment No. 88B in the name of the noble Lord, Lord Howard. Both are concerned with the same point; namely, the disapplication of paragraph 8 of the code in circumstances where it is thought that special environmental factors have to be taken into account in the context of the installation of telecommunications apparatus. With the Committee's permission, I should like to relate my remarks to both of those amendments. I do not know whether the noble Lord, Lord Howard, is happy with that, but they are substantially the same points.
Lord Howard of Henderskelfe: Yes.
Lord Glenarthur: I see that he is. In connection with an earlier amendment, I have explained why the Government believe that the principle of occupier-only consent is necessary in order to enable telecommunications' operators to provide services without delay when they are requested to do so. It is not possible to look at paragraph 8 of the telecommunications code, which both amendments seek to amend, without looking at paragraph 2 which establishes that principle.
There would be no point in enabling telecommunications' operators to install their wires and poles on the basis of the consent of occupiers alone if those occupiers thought that, by virtue of having given their agreement, they would be liable to their landlords for breaching a provision in their tenancy agreements. Clearly the principle of occupier-only consent would not be acceptable if it was possible for a landlord whose agreement was not sought to suffer loss or damage as a result of an operator installing his apparatus. But this will not be the case.
At the risk of repeating myself, the code provides a procedure whereby, if necessary, a landlord who reoccupies his land can seek the agreement of a court to the removal of the apparatus. Furthermore, the operator is under a statutory duty to restore the land to the condition it was in before.
Perhaps I can paraphrase the theme that runs behind the noble Lord's amendment. It is that financial compensation is not enough in relation to apparatus, the installation of which might damage the physical environment and in particular visual amenity. The ultimate removal of apparatus and

581
compensation for the landlord at the end of the day if the land cannot be restored to its former condition cannot make up for the environmental loss in the interim. It is precisely because we recognise the strength of these arguments that we have included in the telecommunications code an objection procedure in relation to overhead apparatus so that those with an interest in land on which apparatus is installed, or neighbouring land, if their enjoyment of it is prejudiced, can seek to have offending apparatus removed immediately.
I regard it as inconceivable that operators would put their own interests at risk by ignoring the strong possibility that they could be required to remove their apparatus if they had ignored the environmental aspects of the installation. However, as I have already indicated, the Government are prepared to consider including conditions in the licences of operators to whom the powers of the telecommunications code are applied, conditions which would have the effect of introducing a prior notification procedure in relation to certain categories of land. The aim would be to enable landlords to influence the way in which apparatus was installed, using their knowledge of the locality to minimise any disruption to the environment.
In proposing this amendment, the noble Lord, Lord McIntosh, could argue that even this does not go far enough and that there are certain types of agreements or covenants—and he specifically referred to covenants—which are of such special significance in environmental terms as to merit special treatment in the telecommunications code. The Government accept this view and I hope that an offer to consider the issue further and to come back with proposals for amending paragraph 8 of the code in the direction of his concern will persuade him to withdraw his amendment.
However, in making that offer, I would emphasise that, apart from pure drafting points which make the amendments unacceptable and on which I shall not detain the Committee, we regard the scope of both this amendment and the amendment of the noble Lord, Lord Howard, as going too wide. Amendment No. 88 would enable a local authority or any body to impose agreement or covenants on the grounds—genuine or otherwise—that the physical environment required special protection. Such a formula could be widely abused in many different circumstances to frustrate perfectly acceptable activities of telecommunications operators.
As far as Amendment 88B in the name of the noble Lord, Lord Howard of Henderskelfe, is concerned, the Government's view is that disapplying the basic principles of the code in relation to the whole of the Green Belt also goes too far, but there is a common core in these amendments; namely, the National Trust, which has clearly distinguishable interests and objectives, which makes it a sensible starting point for the disapplication of paragraph 8. At this stage I would not rule out the possibility that our own proposals would also include the categories covered by the references to the Wildlife and Countryside Act. I hope however that your Lordships will accept that it is reasonable for us to want to give further consideration
582
to all the details before making firm commitments. On that basis, I hope that the noble Lord will not press his amendment.
Lord McIntosh of Haringey: I must say that I am grateful to the noble Lord for these offers. I hasten to say I have no intention of intervening in the family quarrel as between landlords and occupiers. I do not think that in moving this amendment I was in any way putting myself at risk on that score. But certainly the offer of further consideration on Report of genuine convenants—and I accept they have to be genuine convenants and not covenants produced for the purposes of obstruction—is very valuable and if I and my advisers from the Civic Trust can play any part in that consideration, we will be happy to do so. On that basis, I am happy to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Lyell Lord Lyell moved Amendment No. 88A:
[Printed earlier: col. 579.]
The Earl of Kinnoull: May I ask a question? Is the noble Lord suggesting in this amendment that the question of compensation payable refers to the occupier, or the owner, or both?
Lord Lyell: I am sorry, I took a risk and quite rightly my noble friend has asked me to elucidate. We are replacing the old sub-paragraph 8(b) with new subparagraph (2) designed to remove this obscurity in drafting. The intention of paragraph 8(b) in the Bill and above all of the new sub-paragraph (2) in the amendment—I hasten to assure the Committee and my noble friend that there is no policy change—is to ensure that compensation is not payable to a landlord simply in recognition of the fact that his tenant has breached a covenant in his tenancy agreement by allowing a telecommunications operator to install apparatus on the landlord's land.
As the Committee will be aware, the code permits the installation of telecommunication apparatus on private land on the basis of the agreement of only the occupier of the land, and of course, that is providing the occupier is not a short-term tenant: it is referred to as being a term of one year or more.
In support of the principle of occupier-only consent, paragraph 8 of the code is designed to ensure that a tenant who gives his agreement in breach of a clause in his tenancy agreement does not thereby become liable to his landlord. In this context it is also necessary to ensure that the tenant's liability is not transferred indirectly to the operator through the specific compensation provisions in the code. I stress that the code already provides adequate protection for landlords whose agreement is not sought by an operator before apparatus is placed on the land in which they have an interest. Your Lordships will see paragraph 4 sub-paragraph (2); indeed, I have referred those paragraphs to my noble friend in the course of my earlier remarks on earlier amendments. Against the background that I mentioned, Amendments Nos. 87A, 87B and 88A seek to make clear the Government's policy intention; namely, where a provision in a tenancy agreement is unenforceable by virtue of paragraph 8 that fact will be disregarded for

583
the purpose of assessing the amount of any compensation payable under the code.
On Question, amendment agreed to.
11.10 p.m.
Lord Howard of Henderskelfe Lord Howard of Henderskelfe moved Amendment No. 88B:
Page 97, line 13, at end insert—
("( ) This paragraph shall not apply where the land to which the agreement given for the purpose of paragraphs 2 or 3 above falls within one or more of the under-mentioned classes:

(a) land which is the subject of a management agreement under sections 4(5), 7(3) and 45 of the Countryside Act 1968;

(b) land which is the subject of a management agreement under section 39 of the Wildlife and Countryside Act 1981;

(c) land the subject of agreements or covenants with the National Trust enforceable under section 8 of the National Trust Act 1937;

(d) green belt land as defined in section 2 of the Green Belt (London and Home Counties) Act 1938.".)

The noble Lord said: I beg to move Amendment No. 88B. The answer which was given before I moved this amendment had no relevance to the amendment. Noble Lords will no doubt remember that I reminded the noble Lord, Lord Northfield, that practically every tenancy agreement included a prohibition against occupiers granting wayleaves of this kind, and this schedule quite properly provides for the indemnification of the occupier against his landlord for the granting of such wayleaves.
What the Government do not seem to appreciate is that the sort of land which is the subject of a manpower agreement and the subject of a management agreement, and so on, is not land which has a separate landowner and tenant. These are agreements usually directly between the landowner and the various people responsible here. The indemnifications will not apply there because they are not made with the same people.
This is really the same kind of attempt that others have been making as well as myself to get certain protection for land on environmental grounds. I would be the first to admit that my amendment is defective in that it does not refer to the National Trust for Scotland; it refers only to the National Trust for England and Wales. I beg to move.
Lord Glenarthur: When I spoke to Lord McIntosh's amendment I gave a special commitment to consider (a), (b) and (c) of Amendment 88B. I hope that with that assurance, and after the noble Lord has studied in Hansard what I said specifically in relation to it, he will see fit not to press this amendment.
The Earl of Kinnoull: Besides the fact that the operators can go beyond an agreement between a landlord and tenant, as we now understand—they can just wipe out an agreement between landlord and tenant—may I ask whether they can also wipe out any normal restraints on planning other than this 50 ft. pylon?
Lord Howard of Henderskelfe: It would appear to me from what has been said so far that they are going to be able to wipe out practically everything—planning agreements, management agreements, planning consents, and all sorts of other things. I would not put it past them to obliterate all our beautiful landscape. I beg leave to withdraw the amendment in view of the assurances that have been given to me by the Minister.
Amendment, by leave, withdrawn.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 89:
[Printed earlier: col. 535.]
The noble Lord said: Again, this deals with the minimum demands. I do not expect this amendment to be accepted, or this condition to be included in the telecommunications code, but I should like some indication from the Government that the obligation for restoration of the land will be included in the licences. I beg to move.
Lord Lyell: The noble Lord wants an assurance or some explanation from the Government. The Government recognise that it is vitally important that telecommunications operators should be required to make good the streets which are disturbed by the work that they carry out. But I assure the noble Lord and the Committee that this is already provided for, and that the amendment is superfluous. All those operators who are authorised by the Secretary of State to use the powers in the code, and also to undertake works in the street, classified under paragraph 9, will automatically be subject to this splendid measure, the Public Utilities Street Works Act 1950, as the tailpiece to paragraph 9(1) of the code makes clear. Your Lordships will see that.
Section 7(2) of the 1950 Act places this fascinating breed called "statutory undertakers"—the operators under the code will fall into this classification—under an obligation to reinstate and to make good the street after they have completed their works. Failure to do this attracts criminal penalty. But the 1950 Act provides for some flexibility, so that the street authorities may elect to reinstate and to make good the street themselves after the execution of all but what I am informed are minor works. If the street authority chooses this course, the undertaker, by, the measures in paragraph 9(1), is required to make interim restoration. He has to reimburse the authority for the costs of any permanent reinstatement of the street which may be undertaken by that street authority.
Furthermore, the undertaker is required to reimburse the street authority for the costs of remedying any subsequent subsidence of his work. In other words, if he does not do it well, if it is carried out and the undertaker or the operator causes grave structural damage to the street and further repairs are necessary, the operator will be required to make good the street to the condition in which it was before he carried out his works.
I hope that against this background and at this late hour I have been able to give a satisfactory explanation to the noble Lord in his justified question.
Lord McIntosh of Haringey: Only up to a point. The amendment refers to "street, highway or land", and the noble Lord has referred only to legislation in 1950 which refers to streets. I wonder whether he can tell me what assurance there is for the restoration of land to its previous condition?
Lord Lyell: I can give a brief answer, but not tonight. I will study what the noble Lord has said and will write to him. If he wishes to raise this at a later stage I can answer him, but I understand that "street" and the provisions of paragraph 9 go very wide.
The Earl of Kinnoull: Before the noble Lord withdraws the amendment, my noble friend talks about the operator being forced to reinstate or, if there has been a depression in the land, to build it up again. Who will have the right to force the operator to do this? Will it he the tenant of the land or the court? Who will have the right to see that this work is done?
Lord Lyell: I can reply swiftly to my noble friend. I hope I have read out correctly at this late hour that the statutory undertaker—that is, the operator—is under an obligation to reinstate and to make good the street after the completion of his works. I imagine that it is the people we call "the street authority" who would be the relevant authority under the local council. I am pleased that the noble Lord, Lord McIntosh of Haringey, is able to nod assent, since he has served, and I have not, in local government. It would be the street authority who would enforce the obligation under Section 7(2) of this splendid PUSWA, the Public Utilities Street Works Act 1950.
I am able to give an answer this evening to the noble Lord, Lord McIntosh. I am advised that repairs to land and bringing land back into the state in which it was before the operator started work is covered under paragraph 4(2). He will find that in the code.
Lord McIntosh of Haringey: I am grateful to the noble Lord for those explanations and assurances. On that basis I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 90 and 91 not moved]
Lord Lyell Lord Lyell moved Amendment No. 91A:
Page 101, line 4, at end insert—
(" ( ) If within the period of 28 days beginning with the giving of a notice under sub-paragraph (7) above the person to whom that notice was given gives a notice to the operator requiring him to pay compensation, the operator shall he liable to pay that person compensation in respect of loss or damage sustained in consequence of the carrying out of the emergency works in question; and any question as to the amount of that compensation shall, in default of agreement, be referred to arbitration under paragraph 13 below.")
The noble Lord said: I shall speak also to Amendments Nos. 91B, 91C, 91E, 91F, 91G, 91H and 91J, which stand in the name of my noble friend.
Amendment No. 91B:
Page 101, line 16, leave out ("under paragraph 12 above which") and insert ("or question which, in accordance with paragraph 12 above.")
Amendment No. 91C:
Page 101, line 21, leave out ("On a reference") and insert ("Where an objection under paragraph 12 above is referred")
Amendment No. 91E:
Page 101, line 43, at end insert—
(" (2A) Where a question as to compensation in respect of emergency works is referred to arbitration under this paragraph the arbitrator—

(a) shall have the power to direct the operator or the person who requires the payment of compensation to furnish him with such information and to comply with such other requirements as the arbitrator may think requisite for the purposes of the arbitration; and

(b) shall award to the person requiring the payment of compensation such sum (if any) as the arbitrator may determine in respect of the loss or damage sustained by that person in consequence of the carrying out of the emergency works in question.")

Amendment No. 91F:
Page 101, line 45, after ("(2)(a) to (c)") insert ("or (2A)(a)")
Amendment No. 91G:
Page 102, line 3, leave out from ("or) to ("to") in line 4 and insert ("the making of an award under this paragraph—
(a) the references in sub-paragraphs (2)(e) and (2A)(b) above")
Amendment No. 91H:
Page 102, line 6, leave out ("a reference") and insert ("references")
Amendment No. 91J:
Page 102, line 8, leave out ("that sub-paragraph") and insert ("sub-paragraph (2)(e) above")
All these amendments are contained in Schedule 2, but the code allows operators to whom it is applied to install any apparatus by agreement on private land. It also gives them certain powers to enable them to install that apparatus, for example, in the streets. Paragraph 12 enables the code operators to place telecommunications apparatus across railways, canals and tramways, provided that it does not interfere with traffic on the relevant railway, canal or tramway. This power is equivalent to similar powers in the Telegraph Acts, to which we were referring in an earlier amendment, which, of course, Schedule 2 replaces. Schedule 2 also provides that the controller of what is termed the linear obstacle can object to the operator's proposal and any objection which cannot be resolved between the parties is referred to an arbitrator.
Under paragraph 13 of the code (which your Lordships will find on page 101) the arbitrator has power to modify the operator's proposals and, quite properly, to award the controller compensation for any loss or damage that he may sustain in consequence of the carrying out of these works. But, as drafted, Paragraphs 12 and 13 do not provide a mechanism for the controller of the linear obstacle—and, for these purposes. I am given to understand that this is the relevant railway, canal or tramway—to obtain compensation for any loss or damage sustained as a consequence of any works which are carried out by the operator in an emergency.
This is the particularly relevant part. The amendments that I am speaking to seek to remedy that defect. The new sub-paragraph 7(a) of paragraph 12—and that is Amendment No. 91A—is the main amendment, and it sets out the procedure whereby the operator notifies the controller of any emergency work which he, the operator, has carried out. The controller will be able to claim compensation for loss or damge just as he would if the works had been carried out normally. The subsequent amendments to paragraph 13 are, essentially, a restructuring of the existing paragraphs consequential on the main amendment to

587
paragraph 12, which is Amendment No. 91A. With that somewhat lengthy explanation, I beg to move.
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendments Nos. 91B and 91C:
[Printed earlier: col. 585.]
On Question, amendments agreed to.
Lord Glenarthur Lord Glenarthur moved Amendment No. 91D:
[Printed earlier: col. 576.]
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendments Nos. 91E to 91J:
[Printed earlier: col. 586.]
On Question, amendments agreed to.
Lord Glenarthur Lord Glenarthur moved Amendment No. 91K:
[Printed earlier: col. 576.]
On Question, amendment agreed to.
[Amendment No. 91KA not moved.]
11.24 p.m.
Lord Lyell Lord Lyell moved Amendment No. 91KB:
Page 103, line 48, at end insert—
("( ) In the application of this paragraph to Scotland—

(a) for any reference in sub-paragraph (1) to section 10 of the Compulsory Purchase Act 1965 there is substituted a reference to section 6 of the Railway Clauses Consolidation (Scotland) Act 1845;

(b) for the reference in that sub-paragraph to land that has been compulsorily purchased there is substituted a reference to land that has been taken or used for the purpose of a railway;

(c) any question as to a person's entitlement to compensation by virute of that sub-paragraph, or as to the amount of that compensation, shall, in default of agreement, he determined by the Lands Tribunal for Scotland.")

The noble Lord said: Your Lordships will see that paragraph 16 of the code, which covers injurious affection, also provides for compensation which is caused by operators' works in certain circumstances. When these paragraphs were introduced in another place, we were not able to move the necessary adaptations so that the provisions might apply in Scotland. This amendment fills that gap. As paragraph 16 is drafted in relation to England and Wales it refers to the Compulsory Purchase Act 1965. I recall speaking to that on earlier amendments moved by my noble friend Lord Kinnoull. The Compulsory Purchase Act 1965 does not extend to Scotland so that the effect has to be reproduced by reference to equivalent Scottish legislation. I beg to move.
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey had given notice of his intention to move Amendment No. 92:
[Printed earlier: col. 536.]
The noble Lord said: On the basis that I shall have a number of different and more extensive amendments to paragraph 17 of Schedule 2 at Report stage, I shall not move this amendment at this time.
[Amendment No. 92 not moved.]
[Amendments Nos. 93 and 94 not moved.]
Lord Glenarthur Lord Glenarthur moved Amendment No. 94A:
[Printed earlier: col. 576.]
The noble Lord said: This amendment was spoken to earlier. I beg to move.
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 95:
[Printed earlier: col. 536.]
The noble Lord said: I am not quite so co-operative on this amendment. As I indicated when speaking to Amendment No. 81, this is a matter of considerable practical importance even though it may seem minor to some people. There is, and is bound to be, an increasing problem of abandoned equipment of various kinds and it seems necessary for local authorities to have the power to remove abandoned telecommunications apparatus. I do not see how the power can be exercised in the context of a licence, since presumably the licensee is not capable either of being contacted or being held to the conditions of his licence. It therefore needs direct action to give local authorities the powers required, and I beg to move.
Lord Glenarthur: This amendment raises an important issue in relation to the responsibility of local authorities for ensuring in particular that the highways for which they are responsible are free from obstruction and abandoned apparatus that may be undesirable in environmental terms.
I think, however, that the code already goes a very long way towards meeting the noble Lord's concerns. Paragraph 22 of the code provides that an operator is not entitled to keep his apparatus installed on land if it is not used for the purposes of the operator's system and there is no reasonable likelihood that it will be so used. Paragraph 21 of the code lays down the procedure to be followed in order to enforce a right to have apparatus removed from land—for example, in a case where the apparatus ceases to be used for the statutory purposes of running the relevant telecommunication system.
Thus, there is no doubt that a local authority could, under these provisions, enforce a right to remove apparatus abandoned on land which it owns. If necessary, the authority could seek an order of the court, enabling it to remove the apparatus itself and seek reimbursement of the cost of doing so from the operator. A highway authority would, under these provisions, also be entitled to require the removal of any apparatus abandoned in any section of the highway for which it is responsible. The telecommunications code apart, highway authorities also have power to remove abandoned apparatus when it causes a nuisance, or otherwise interferes with the highway.
I hope the noble Lord will agree, therefore, that we have provided local authorities with very adequate powers to deal with the problem of abandoned apparatus. Highway authorities are already enabled to require the removal of abandoned apparatus in certain circumstances in the street. Although the noble Lord's amendment does not specifically provide such a power, it is clear that a local authority would need to he given a power to enter on to private land in order to

589
remove abandoned apparatus. I do not think it would he proper to give local authorities power to enter on to land for this purpose, particularly when the occupier of that land is already enabled to require the removal of any apparatus abandoned on his land. I would therefore hope that the noble Lord will see fit to withdraw the amendment.
Lord McIntosh of Haringey: I am afraid that that answer is unsatisfactory in a number of ways. First, the noble Lord has referred almost entirely to highway authorities and to the removal of telecommunications apparatus from the highway, whereas, as he recognised in his closing remarks, the purport of the amendment goes much further than that. It includes land other than the highway, which may be private land and may be land owned by the authority or accessible in other ways. The noble Lord also appears to have failed to realise the importance of paragraph (b) of my amendment, which refers to the case of abandoned telecommunication apparatus which the operator has failed to remove after reasonable notice. The kind of occasion that I am thinking about, and which the Government must think about, is the occasion when an operator is unable to remove it, when an operator is no longer solvent or, for example, when an operator simply does not have the power or the finance to do what is environmentally necessary.
The Government will have to look at this again, extending the powers beyond those of highway authorities. The alternative which the Minister suggested, of going to the courts has been found, in the case of abandoned cars, to be quite excessively slow and expensive and led, until greater powers were given to highway authorities, to abandoned cars being very difficult to get rid of. I suggest that the changes in the law, which have enabled local authorities more efficiently to get rid of dead cars from the highway, ought to be applied to telecommunication apparatus, and that there should be no difficulty for the Government in finding ways of doing so. But on the basis that there is need for further thought about the right of access to private land, I am prepared to withdraw the amendment at this stage. I take enough comfort from what the Minister has said to think that he will be willing to answer the specific points which I have made in moving this amendment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Glenarthur Lord Glenarthur moved Amendment No. 95A:
[Printed earlier: col. 576.]
On Question, amendment agreed to.
[Amendment No. 96 not moved.]
Schedule 2, as amended, agreed to.
Clause 11 [Provisions supplementary to section 10]:
Lord Lyell Lord Lyell moved Amendment No. 96A:
Page 13, line 24, leave out ("made by statutory instrument")
The noble Lord said: This is a drafting amendment. As a result of amendments made at an earlier stage, Clause 92 now draws together references in the Bill to the Secretary of State's power to make orders or schemes by statutory instrument. Thus the reference
590
in Clause 11(1) to an order applying parts of the Electricity Supply (Northern Ireland) Order being "made by statutory instrument" is no longer necessary. This amendment seeks simply to remove the superfluous words. I beg to move.
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendment No. 96B:
Page 13, line 34, at end insert—
("( ) The Secretary of State may from time to time by order provide that the telecommunications code shall have effect for all purposes as if an amount specified in the order were substituted for the amount specified, or for the time being having effect as if specified, in sub-paragraph (3) of paragraph 16 of the code as the minimum amount of compensation payable under that paragraph: and an order under this subsection may contain such transitional provisions as the Secretary of State considers appropriate.")
The noble Lord said: Paragraph 16 of the telecommunications code in Schedule 2 makes provision for compensation to be paid by an operator in respect of injurious affection to neighbouring land caused by the exercise of a right to install apparatus. This amendment to Clause 11 is related to the provision in paragraph 16(3) of the code that compensation for injurious affection should not be payable, unless the amount of compensation exceeds £50. This is designed to exclude nuisance and frivolous claims and follows the precedent in the existing land compensation legislation. It is thought however that there should be a power for the Secretary of State to amend by order this de minimis figure in the light of inflation. This amendment would give the Secretary of State such a power which he would be able to exercise, subject to parliamentary control, by the negative resolution procedure. I beg to move.
On Question, amendment agreed to.
Clause 11, as amended, agreed to.
Clause 12 [Modification of licence conditions by agreement]:
11.35 p.m.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 96C:
[Printed earlier: col. 514.]
The noble and learned Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
[Amendment No. 97 not moved.]
Clause 12, as amended, agreed to.
Clause 13 [Licence modification references to Commission]:
Lord Morris Lord Morris moved Amendment No. 98:
Page 15, line 32, at end insert—
("(1A) Subject to subsection (1B) and (1C) below where the Director makes a reference to the Commission under subsection (1) above, he may if he sees fit modify the conditions of any licence to which the reference relates.
(1B) Any modification of a licence under subsection (1A) above shall cease to have effect upon the making of any modifications to the licence under section 15 below in consequence of the reference to the Commission or at such earlier time as the Director may declare.
(1C) Subsections (3) to (6) of section 15 below shall apply to the making of modifications to any licence under this section.")
The noble Lord said: Despite the fact that I understand that the argument underlying this amendment is well-known to Her Majesty's Government, it is critically important that Parliament should consider the argument. Although it is known to the Government it is for Parliament to ratify, at least, the Government's view. The amendment is designed to assist the vital role of Her Majesty's Government and, indeed, the Director General of Telecommunications, and to provide industry with a means of avoiding the cost of having eternally to look to their backs.
At Second Reading I suggested that more emphasis should have been placed in the Bill upon deterring a wrong rather than upon emphasising remedies to a wrong already committed and that there should be more incentive for self-regulation rather than encouraging complainants to the department and to the Office of Telecommunications. The Director General of Telecommunications and the Department of Trade and Industry will be for ever reviewing the performance of individual licensees and considering the conditions of licensees' licences against the performance of those conditions—in other words, for ever being regulatory and administering rather than performing their more important role of concentrating their endeavours upon gearing the tempo of change and encouraging the commercial and industrial initiative best suited to the national interest.
As the Bill is drafted, the only expectations of dealing with new forms of anti-competitive behaviour lie in the provisions of Clause 3(2)(b) and (h), the provisions of Clause 13 and the duties of direction under Clause 49, whereby the director general can exercise the functions of the Director General of Fair Trading and the provisions of the Competition Act 1980.
The manner in which the Secretary of State's duties under Clause 3 are perceived in the exercise of the licensing-granting function under Clauses 7 and 8 may be anticipated in the form of a draft licence which has recently been published. This contains various restrictions upon what could be anti-competitive practices but at the same time does not plug every possible loophole, an ideal which I fully admit would be quite impossible to achieve. However, the problem that this amendment is intended to highlight is the inventiveness of the major suppliers of goods and services in thinking up new means of preventing effective competition.
The United States experience indicates that many methods could be used: for example, competing operators denied the same quality of connection: free telephones and other apparatus could be offered, the charge being included in line rentals; excessive charges for installing sockets for jacks for prime instruments; loyalty discounts; "bundling" of equipment and service prices; leasing arrangements to tie in customers; varieties of cross-subsidisation, predatory pricing and transfer pricing; and the use of "migration strategy"—in other words, raising the price of use of existing installed equipment to encourage the purchase of new offerings, particularly in advance of competitive offerings. Some of these practices could include artificial restriction in permitting
592
interconnection of one licensee's system and another's, the showing of undue preference to itself, cross-subsidisation of services, and alteration—this is an important one—without adequate notice of licensees' systems, of their stored commands or protocols, in such a way as to cause confusion to their competitors. However, no claim could be made for the exhaustiveness of this list.
Against this background of opportunity for an ingenious and knowledgeable licensee, the lengthy procedures of Clause 13 onwards, whereby a licence condition may be amended against the wishes of the licensee, pursuant to a reference to the Monopolies and Mergers Commission, must be examined. They are indeed extremely lengthy. This amendment is designed to allow the director to take prompt action—by analogy it could be described as an injunction—to suppress anti-competitive practice in this way.
Since the suppression of anti-competitive behaviour is an acknowledged aim of the Bill, it would be unfortunate if the procedures laid down were too slow-footed to keep up with the tactics likely to be employed. By the proposed amendment, it is intended that the necessary licence amendments may be made promptly. While the amendment stands on its own, it would be immeasurably reinforced by other amendments put forward to secure a licensee's prompt compliance with the conditions of his licence. I beg to move.
Lord McIntosh of Haringey: I do not think any of us would wish to see delay for its own sake, or to weaken the powers of the director general, but what is proposed in this amendment does seem quite a remarkable instance of the latter being judge and jury in his own case. It is suggested that, when the Director General of Telecommunications makes a reference to the Monopolies and Mergers Commission, he shall, without waiting for any response from the commission and without hearing any of the evidence the commission will have to consider, at the same time modify, without consent, the conditions of the licence. If that is not prejudging the decision of the commission, I do not know what is.
Lord Morris: The noble Lord has totally missed the point. The director general must, before he makes a reference to the commission, come to the conclusion that there is a prima facie case. If there is, there is absolutely no reason why he should not make an injunction. This practice is not unknown to the courts in an analogous civil action, where speed is of the essence.
Lord McIntosh of Haringey: That is no analogy at all. A prima facie case is for reference to the commission. It goes no further than that. The noble Lord suggests the director should act on this prima facie case rather than wait for the judgment. I am very happy to leave it to the noble and learned Lord to explain to the noble Lord, Lord Morris.
Lord Morris: I am sure the noble Lord has some experience of how long it would take for the Monopolies and Mergers Commission to come to a conclusion. Has he any idea?
Lord Mackay of Clashfern: Perhaps I may be allowed to intervene. I am not in favour of delay for its own sake either. The concern that my noble friend has evinced I perfectly understand. The procedures for modifying licence conditions do envisage some delay in those circumstances where a licensee does not agree that an amendment should be made. However, that delay is for as short a period as possible consistent with a thorough investigation of the matters referred to the Monopolies and Mergers Commission. The requirement for the director to specify a period of up to six months within which the commission must report is the same as the period allowed for merger references under the Fair Trading Act. In framing this provision in the Bill, the Government saw the need to balance different considerations. On the one hand is the clear desire to minimise the period of uncertainty for the licensee concerned, and the need for speedy remedies to matters which affect the public interest. On the other is the need for the commission to have a sufficient period of time to investigate matters which may critically affect the licensee's business and also the wider interests of other operators, manufacturers of telecommunications equipment, consumers and users of services and apparatus, and so on.
Your Lordships will note that this amendment does not seek to challenge that balance of considerations. It accepts that the modification of licence conditions where there is no agreement between the director and the licensee should be a matter over which the commission acts as an independent arbiter. But I have to say that whilst apparently accepting the basis of our present policy, it would undermine it in a very significant way.
The regulatory arrangements set out in the Bill strike a fair balance between all the interested parties. That balance could be quite unfairly tilted in unpredictable directions if the director had power to modify licence conditions on an interim basis while waiting for the Monopolies and Mergers Commission to report, even allowing for the public notification procedures in Clause 15 which the amendment envisages would apply.
My noble friend referred to the court situation and an interim injunction—or, as I prefer to call it, an interim interdict. The situation very often is that these are granted to preserve the position at the time litigation starts; in other words, to prevent the position being innovated upon. In a sense that is the way in which this Bill proceeds; it is on the view that matters should not be altered until the Monopolies and Mergers Commission reports.
There is one other matter. A good number of the practices to which my noble friend referred are already prevented in the terms of the licence, and to a certain extent the imagination which goes into the preparation of the licence terms will play a significant part in reducing the problem to which my noble friend draws attention. I hope that against that background my
594
noble friend will feel that, although I see the point that he makes, perhaps on balance the Bill is better as it stands.
Lord Morris: I am most grateful to my noble and learned friend the Lord Advocate for the carefully considered argument that he has given to this amendment. I will of course have the opportunity to consider what he said in greater detail at a more reasonable hour. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Mackay of Clashfern: moved Amendment No. 98A:
[Printed earlier: col. 514.]
The noble and learned Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 13, as amended, agreed to.
Clause 14 [Reports on licence modification references]:
Lord Morris Lord Morris moved Amendment No. 98B:
Page 18, line 18, after second ("person ") insert ("and to the attention of persons likely to be affected by the report ")
The noble Lord said: On mature reflection this amendment has been tabled somewhat clumsily. The intention is very clear. It is to bring into another part of the Bill the very good intentions of Her Majesty's Government in drawing to the attention of persons likely to be affected by the report, in this instance in Clause 14; namely, in particular the complainant affected by that. I am as certain as I can be that I have tabled the amendment in the wrong part of the clause. Notwithstanding that technical point, I beg to move.
Lord Mackay of Clashfern: As I understand the amendment it is pretty much in line with the amendments that I have proposed to other clauses. On that assumption, if my noble friend is prepared to withdraw this amendment, I will undertake to bring forward an amendment on Report which I believe will be appropriate to deal with the point he makes.
Lord Morris: I am most grateful to my noble and learned friend. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 14 agreed to.
Clause 15 [Modification of licence conditions following report]:
[Amendment No. 99 not moved.]
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 99A:
[Printed earlier: col. 514.]
The noble and learned Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 15, as amended, agreed to.
Clause 16 [Securing compliance with licence conditions]:
11.49 p.m.
Lord Glenarthur Lord Glenarthur moved Amendment No. 99B:
Page 19, line 31, leave out ("an operator") and insert ("a person who is authorised by a licence granted under section 7 above to run a telecommunication system (in this Act referred to as a "telecommunications operator")")
The noble Lord said: It might be for the convenience of the Committee if we considered with this amendment Amendments Nos. 99C, 99E, 99F, 99G, 99H, 99J, 99L, 99N, 99P, 99Q and 150A.
Amendment No. 99C: Page 19, line 40, leave out ("an") and insert ("a telecommunications")
Amendment No. 99E: Page 20, line 19, after second ("the") insert ("telecommunications")
Amendment No. 99F: Page 20, line 21, after first ("the") insert ("telecommunications")
Amendment No. 99G: Page 20, leave out lines 31 to 33.
Amendment No. 99H: Clause 17, page 21, line 16, after first ("the") insert ("telecommunications")
Amendment No. 99J: Clause 17, page 21, line 19, after ("the") insert ("telecommunications")
Amendment No. 99L: Clause 17, page 21, line 40, after second ("the") insert ("telecommunications")
Amendment No. 99N: Clause 17, page 22, line 8, after second ("the") insert ("telecommunications")
Amendment No. 99P: Clause 18, page 22, line 9, after ("the") insert ("telecommunications")
Amendment No. 99Q: Clause 18, page 22, line 18, after second ("the") insert ("telecommunications")
Amendment No. 150A: Clause 94, page 82, line 30, at end insert—(""telecommunications operator" has the meaning given by section 16(1) above:")
These are technical amendments and I shall only take a moment of the Committee's time. Clauses 16, 17 and 18 as they stand refer to "an operator" which is defined at the end of Clause 16 as a person who is authorised by a licence granted under Clause 7 to run a telecommunications system. As your Lordships may have noticed, there are amendments on the Marshalled List to Clauses 31, 32 and 33. These result in a reference to "a telecommunications operator". However, this person so described is the same as the person described as "an operator" in Clauses 16 to 18. It is obviously sensible to have the two descriptions the same and these amendments are designed to change "an operator" to "a telecommunications operator". It is necessary to do it this way round rather than change Clauses 31, 32 and 33 because in those clauses the word "telecommunications" is necessary to make the provision readily understandable. Amendment No. 150A simply adds the definition of a telecommunications operator to the list of definitions in Clause 94. I beg to move.
On Question, amendment agreed to.
Lord Glenarthur Lord Glenarthur moved Amendment No. 99C:
[Printed above.]
On Question, amendment agreed to.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 99CA:
Page 20, line 5, leave out ("where he is satisfied that") and insert ("if")
The noble and learned Lord said: The amendment seeks simply to introduce consistency between final orders and orders confirming provisional orders by deleting the words in subsection (4),
"where he is satisfied that".
so that the director will be obliged to confirm a provisional order if, at the time the order was made, its provisions were requisite. I beg to move.
On Question, amendment agreed to.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 99D:
[Printed earlier: col. 514.]
The noble and learned Lord said: I have spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Glenarthur Lord Glenarthur moved Amendments Nos. 99E, 99F and 99G:
[Printed above.]
On Question, amendments agreed to.
Clause 16, as amended, agreed to.
Clause 17 [Procedural requirements]:
Lord Glenarthur Lord Glenarthur moved Amendments Nos. 99H and 99J:
[Printed above.]
On Question, amendments agreed to.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 99K:
[Printed earlier: col. 514.]
The noble and learned Lord said: I have spoken to this amendment earlier. I beg to move.
On Question, amendment agreed to.
Lord Glenarthur Lord Glenarthur moved Amendment No. 99L:
[Printed above.]
The noble Lord said: This amendment has already been spoken to. I beg to move.
On Question, amendment agreed to.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 99M:
[Printed earlier: col. 514.]
The noble and learned Lord said: I have spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Lord Glenarthur Lord Glenarthur moved Amendment No. 99N:
[Printed above.]
The noble Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 17, as amended, agreed to.
Clause 18 [Validity and effect of orders]:
Lord Glenarthur Lord Glenarthur moved Amendments Nos. 99P and 99Q:
[Printed above.]
The noble Lord said: I have already spoken to these. I beg to move.
On Question, amendments agreed to.
The Deputy Chairman of Committees: If Amendment No. 99R is agreed to, it will not be possible to call Amendment No. 100.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 99R:
Page 22, line 33, leave out from ("it") to end of line 35 and insert ("; and the obligation to comply with a provisional order which is subsequently confirmed with modifications shall be regarded for the purposes of this subsection as an obligation to comply with the order with such of the modifications (if any) as relax the requirements of the order.
(5A) Where a duty is owed by virtue of subsection (5) above to any person—

(a) any breach of the duty; and

(b) any act which induces a breach of the duty or interferes with its performance and which is done wholly or partly for the purpose of achieving that result,

shall be actionable at the suit or instance of that person.
(5B) In any proceedings brought against any person in pursuance of subsection (5A)(a) above, it shall be a defence for him to prove that he took all such steps as were reasonably practicable to comply with the order.")
The noble and learned Lord said: This amendment is part of a fairly important package of amendments which has the effect, among other things, of getting rid of an important criminal provision in Clause 45. It is against that background that I present the matter.
The main effect of the amendments to Clause 18, which I move now, is to ensure that customers of public telecommunication operators who suffer loss or damage as a result of certain kinds of industrial action are able to sue those concerned. They may also obtain injunctions or interdicts against those responsible. This provides members of the public with a civil remedy against selective industrial action by trades unions and in the circumstances the Government were able to review the provisions of Clause 45 of the Bill which make it a criminal offence for employees of public telecommunications operators to take certain kinds of action there described.
I should explain that Clause 45 reproduces with modifications the provisions in the existing Telegraph Acts which make it a criminal offence for anyone engaged in the running of a public telecommunication system intentionally and contrary to his duty to prevent, delay or interrupt the transmission or reception of a message sent by means of the system. It is clear that some forms of industrial action, such as deliberate blacking of a particular customer's premises, so that he could not use the telephone to
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send messages, could constitute a criminal offence. Other forms of industrial action, such as an all-out withdrawal of labour which had only the incidental effect of preventing some customers using the telephone to send messages, might well be in a different position.
The Government have decided that, in view of the availability of civil remedies as a result of the amendments that I now propose to Clause 18, it would be right to delete Clause 45(1)(a). That means that, from the appointed day, no form of industrial action by employees of public telecommunications operators which prevented, delayed or interrupted the transmission or reception of messages will be a criminal offence. Any such action would, however, be a breach of the employee's contract of employment and would render him liable to disciplinary action by his employer, and any member of the public who suffered loss because an employee of a public telecommunications operator prevented the transmission or reception of a message would have a remedy against the operator under his contract for the supply of telecommunication services, assuming that the contract covered that situation.
The Government's ability to amend Clause 45 has arisen because these amendments to Clause 18 of the Bill clarify the right to claim damages or to seek injunctions or interdicts of those who suffer loss as a result of a deliberate action by an employee of a telecommunications operator to prevent them sending telephone messages. At present Clauses 7 and 8 of the Bill provide that a public telecommunications operator will have obligations under his licence to provide telecommunication services, for example to rural areas. If the operator fails to honour those obligations, he can be subject to orders made by the Director General of Telecommunications under Clause 16, requiring him to do specific things in order to fulfil his licence obligations. It is a statutory duty for the operator to obey such enforcement orders, and they are enforceable in the courts. Anyone who is adversely affected by a breach of the duty to obey an order made by the director can obtain damages from the operator.
It is probably the law that any action to induce a breach of a statutory duty constitutes a tort or a wrong, and the person committing the tort may be liable to actions for damages, or to injunctions, or to both. Therefore an employee of a public telecommunications operator who took action, (including industrial action) to prevent the operator complying with his statutory duty to obey the director's enforcement order would be liable to civil action for damages, or an injunction or interdict, or both. The legal position is not free of doubt, and it may be that inducement to breach a statutory duty is not in fact a wrong and that an employee or his trade union could not be sued for damages, or for an injunction or interdict, in the circumstances that I have described.
The Government have therefore decided to clarify the law but only so far as concerns acts which induce a breach of the statutory duty to obey enforcement orders under this Bill, or which interfere with the performance of such a duty. The amendments to Clause 18 of the Telecommunications Bill will make it clear that any act which induces a breach of the duty

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to obey a Clause 16 enforcement order, or which interferes with the performance of such a duty, shall be actionable by any person affected by the breach of the duty. The new provision will apply only to acts which are done wholly or partly for the purpose of achieving the result of inducing a breach of the duty or of interfering with the performance of the duty.
This limitation is particularly important for those concerned in industrial relations in, for example, British Telecom, and I should explain the effect of the words,
"wholly or partly for the purpose of achieving the result".
of inducing a breach of the statutory duty. For example, an electricity undertaking might cut off the electricity supply to a public telecommunications operator who had not paid his electricity bill. That could cause the operator to breach his duty to obey an enforcement order, but the electricity undertaking would not be liable to action in the courts because its action was not taken with a view to the result, even in part, of causing the operator to breach the enforcement order.
Similarly, a trade union which called an all-out strike of employees of a public telecommunications operator over a pay dispute which resulted in a breach by the operator of his duty to comply with a Clause 16 enforcement order would not, in our view, be liable because the action was not taken with a view to achieving the result of causing the operator to breach his duty. The breach would be an incidental and an unintended result of the industrial action.
On the other hand, if a manufacturer deliberately withheld normal supplies of a special kind of apparatus which he knew the operator needed in order to provide a service which the operator was required to provide under an enforcement order, and if the manufacturer sought this result, he might well be liable. Similarly, if an employee or a group of employees of the operator deliberately blacked or continued to black a customer with a view to the result of causing the operator to breach his duty to obey an enforcement order, they might well be liable to pay the customer damages and would be liable to an action for an injunction or interdict.
Clause 18 is also being amended to ensure that an operator will not be liable for damages when he breaches an order if he can prove that he did all that was reasonably practicable to obey the order. This will provide the operator with a defence against claims for damages in circumstances where the breach of a duty was wholly beyond remedy by him. These amendments have been brought forward to deal with concern expressed in relation to the provisions of Clause 45. They deal with a complex area. The Government stand ready to consider any representation about the amendments and any matters of drafting that anyone seeks to raise. I beg to move.
Lord McIntosh of Haringey: This is a complex and dense amendment. It has been moved in an unavoidably complex and dense way, and also at breakneck speed, which makes it somewhat difficult for us. I think that it would be wise for us to concentrate on criticism of the right to strike section of
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the Bill to our own amendment on Clause 45. I appreciate the attempt in this amendment to modify the conditions continued from the Telegraph Acts, but I think that it would be necessary for us to consider them all together.
I simply ask for one concession from the Government. In view of the hour, we shall not have the opportunity to study the noble and learned Lord's speech in time for the debate on the amendment tomorrow. I wonder whether it would be possible to have a copy of the speech in time for us to consider it, as we normally would, on the later amendment.
Lord Mackay of Clashfern: I think that that should he possible. I would hope to facilitate it later tonight, or possibly tomorrow morning.
Lord Morris: I think that the noble Lord, Lord McIntosh of Haringey, will have no problem with regard to my noble and learned friend's speech. It will be available in the Library first thing tomorrow. The amendment places me in a difficult position. As your Lordships will be aware, the amendment is new despite the fact that there is no star to it. It was tabled on Friday, and was seen only today. It has the effect not only of shooting but also of hanging, drawing and quartering my fox with regard to Amendment No. 100. I am not suggesting in any way that this was done deliberately. I believe, however, that I am duty bound to speak to Amendment No. 100 at this stage. I understand that this is my right.
I support the amendment in its entirety. However, it does not go quite as far as I should like. Amendment No. 100 is significant in respect of the new text contained in paragraph (a). This has the effect of making actionable not just the breach of an order made by the director but also the breach of a licence condition about which the order is made. This is intended to give rise to a liability on the part of any licensee in breach to pay compensation with effect from the date the breach first caused loss.
The purpose of the amendment is to secure promptly a licensee's compliance with his licence conditions in circumstances where delay in compliance would cause other users of telecommunications services considerable personal loss. Where these users are also licensees in their own right and potential competitors with a public telecommunications operator, the requirement to secure the public telecommunications operator's compliance with his licence is even more desirable and urgent.
There is, indeed, scope and incentive for a licensee effectively to delay the enforcement of his licence against him and there is no adequate remedy available to others for losses suffered by them during the period when enforcement is delayed, even if the licensee is found by due process to have been acting entirely contrary to his licence terms.
The Government were aware that this amendment was tabled by me the day after the Second Reading. It was tabled a very long time ago. I am absolutely certain that argument was developed either to agree with or to counter this amendment. I believe that it

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would be only fair in the circumstances for me to have some sort of answer to the argument devolved upon this amendment.
12.6 a.m.
Lord Mackay of Clashfern: I think that it is possible to regard the amendment to which my noble friend has just spoken as a kind of criticism of the amendment which I have just moved. In that light may I say that the arrangements which we have proposed in the Bill, as amended by the amendments that I have just made, are designed to avoid the excessive litigation which has been a feature of regulatory activity in other parts of the world, and to give protection to individuals who cannot afford to go to law. Such an approach is however incompatible with a free-for-all where individuals can take licensees to court for breaches of licence conditions, as my noble friend is proposing. To allow that would ensure that the director's key role as the kind of policeman of the condition was undermined, and by allowing all aggrieved persons recourse to the courts, would create a certain recipe for a good deal of confusion and delay. It could also open the door to a flood of contentious litigation and take us some way down the road of experience in other parts of the world.
We do not believe that such a procedure would benefit complainants. Both they and licensees would be involved in time-consuming court actions which, for complainants, would also be unnecessary since there is a much shorter, cheaper and effective route through the director. In a sense the amendment itself acknowledges that because it indicates that the proceedings should only be brought with the prior written consent of the director. In that situation it appears to me to acknowledge the correctness of the principle that we have embodied in the arrangements that we have proposed.
Lord Morris: In the circumstances of the tabling of this particular amendment, I feel sure that my noble and learned friend will understand that I must of course reserve the right to return to this very important point at another stage. However, as a most eminent lawyer, he will understand that the multiplicity of litigation argument born of experience in other countries, really does not hold water in any way whatever. My noble and learned friend will know better than anybody the hideous cost of litigation in this country and anybody who goes to law in this country does so with the greatest care and at their greatest peril. As he knows, in the United States—which I believe is the experience which he is praying in aid—the costs procedures, which are geared to the amount of damages won in court, are an incentive to a multiplicity of litigation. There is no incentive whatever to a multiplicity of litigation in this country. I believe that for a Bill in any way to deprive the individual from recourse to the courts, is a very worrying precedent. However, I shall return to this point at a later stage.
Lord Stoddart of Swindon: This is a very complicated and a very important amendment. I must confess that I think that the Committee has not been done a service by having the amendment brought forward only this morning on today's Marshalled List.
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Nor is the Committee being done a service by discussing this very complicated and important amendment at this time of night. I believe that we should have a fuller Committee and a much refreshed Committee—refreshed after having had a good night's sleep—to contemplate and think about what the noble and learned Lord the Lord Advocate said.
This matter was raised on Standing Committee A in another place on 24th November, when there was quite a long debate about the position of workers and trade unions in the telecommunications industry. Quite frankly, I am still not clear as to just exactly what their position will be after this amendment and the amendment to Clause 45—Amendment No. 108F—have been agreed to, if they are agreed to, by this Committee. Will workers in the telecommunications industry have the same rights as those in other industries? Will they be protected from criminal liability under circumstances, or under certain circumstances? Will they be able to take selective action—for example, as selective action can be taken in the Civil Service, in the electricity industry and in the gas industry—without being liable to criminal prosecution and criminal penalties?
Those matters were not made clear by the noble and learned Lord the Lord Advocate when he spoke to this particular amendment, Amendment No. 99R. On Standing Committee A at col. 896 of Hansard the Solicitor-General said:
"It means"—
and he was referring here to the question of the right to strike and the right to take action—
"no infringement and no derogation from the right to strike".
That is fair enough and those are my own words. Then he went on:
"But in the case of industrial action falling short of a strike, a withdrawal of labour, the clause may, according to the circumstances, make such action a criminal act. The same answer has to he given with respect to the 1863 and 1953 Acts."
We want further assurances and a further clarification of what the Government have in mind with regard to this amendment and the amendment to Clause 45. I hope that the noble and learned Lord the Lord Advocate can give those assurances tonight and, if he cannot, then I hope that the Committee can adjourn and that the noble and learned Lord can come forward tomorrow and give us the explanations then.
Lord Mackay of Clashfern: As I sought to explain, the amendment which I hope to move in just a little while will delete the provisions from Clause 45, which had the effect of making a criminal offence arise in relation to interfering with the sending on of a message, and I shall explain that a little more fully in relation to Amendment No. 108R.
On the other aspect of this matter, in effect we are deleting the portion of Clause 45 which was the subject of the debate to which the noble Lord, Lord Stoddart of Swindon, referred. Therefore, that as a basis for criminal liability disappears. That really is the point of this. As I have sought to explain, in order to try to meet the concerns expressed in that direction we have deleted that and taken the matter into the civil area.
On Question, amendment agreed to.
[Amendment No. 100 not moved.]
12.15 a.m.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 100A:
Page 22, line 37, leave out (" (5) ") and insert (5A)(a) ")
The noble and learned Lord said: This is part of the package of amendments to which I have just referred, and I beg to move.
On Question, amendment agreed to.
The Deputy Chairman of Committees: Amendment No. 101 should be in the name of the noble Lord, Lord Morris.
Lord Morris Lord Morris moved Amendment No. 101:
Page 22, line 41, at end insert—
("(6A) Subject to subsection (6B) below, any person who suffers damage by reason of the failure by a public telecommunications operator to comply with any condition to which section 8(1) above refers in that operator's licence shall be entitled to compensation for that damage from that operator.
(6B) No proceedings shall he brought by virtue of subsection (6A) of this section without the prior consent in writing of the Director.
(6C) In proceedings brought against a public telecommunications operator by virtue of subsection (6A) of this section it shall be a defence to prove that he had taken such care as in all the circumstances was reasonably required to ensure compliance with the condition of the licence in question.")
The noble Lord said: For one glorious moment I thought the Government had taken up this amendment, but I was quite wrong. I will not take long. This amendment does nothing other than place another arrow in the quiver of Her Majesty's Government and, indeed, the director general of Oftel. I spoke briefly on the effect of this amendment on the previous one, Amendment No. 99R, in that I believe it is very important that the director general of Oftel has the power to grant his fiat for a private prosecution to any person who suffers damage by reason of failure by a public telecommunications operator to comply with any condition in the operator's licence which is referred to in Clause 8(1). I believe that if there is any restriction on an individual's recourse to the courts, it is something which has to be looked at with the very greatest care. It would be quite wrong to argue this case in detail at this time of night, but I would be interested to hear what the Government have to say with regard to this amendment. I hope they do not repeat the multiplicity of litigation argument, because I never have enjoyed it.
Lord Mackay of Clashfern: When I explained the answer that we had to Amendment No. 100, as a criticism of the amendment which I had then moved, I of course took account of Amendment No. 101 at the same time. This makes it unnecessary for me to repeat the multiplicity of litigation argument. All I need to do is to refer to it.
Lord Morris: My noble and learned friend the Lord Advocate, who is a value-added network service in himself in that he can repeat an argument at the speed and clarity of the most modern telex machines, has done it yet again. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 101ZA:
Page 22, line 42, after ("section") insert—
(" "act", in relation to any person, includes any failure to do an act which he is under a duty to do and "done" shall be construed accordingly;
(" "contravention", in relation to a final or provisional order, includes any failure to comply with it;")
The noble and learned Lord said: This is the completion of the amendment to Clause 18 which I sought to explain earlier, making necessary definitions for the purpose of that provision. I beg to move.
On Question, amendment agreed to.
Clause 18, as amended, agreed to.
Clause 19 agreed to.
Clause 20 [Approval of contractors]:
Lord Cockfield Lord Cockfield moved Amendment No. 101A:
Page 24, line 30, leave out subsection (9).
The noble Lord said: My noble friend spoke to this amendment during consideration of Amendment No. 70A. I beg to move.
On Question, amendment agreed to.
Clause 20, as amended, agreed to.
Clause 21 agreed to.
Clause 22 [Approval etc. of apparatus]:
Lord McIntosh of Haringey Lord McIntosh of Haringey had given notice of his intention to move Amendments Nos. 102 and 103:
Page 25, line 42, leave Out ("or")
Page 26, line 18, at end insert—
("or.
(c) the apparatus, if it has been imported or is assembled predominantly from imported components, has been (or the relevant components have been) imported from a country or countries which permit the import into them of apparatus made in the United Kingdom.")
The noble Lord said: These two amendments, Nos. 102 and 103, follow Amendments Nos. 36 and 50, which we moved earlier on in the Committee stage and neither of which found favour with your Lordships. I became convinced in the course of the discussion that other noble Lords—notably the noble Lord, Lord Weinstock—had better wording than we had in protecting the rights of British manufacturers, which certainly have to be protected in some way. On the basis that we shall have to take account of comments earlier on and come back to this matter on Report. I shall not seek to move these two amendments.
[Amendments Nos. 102 and 103 not moved.]
The Deputy Chairman of Committees: Perhaps I should inform the Committee that, if Amendment No. 104 is agreed to, I shall not be able to call Amendments Nos. 105 or 106.
Lord Mottistone Lord Mottistone moved Amendment No. 104:
Page 26, line 17, leave out subparagraph (ii).
The noble Lord said: In view of the lateness of time I propose to speak to Amendments Nos. 105 and 106

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at the same time, because they are alternates on the assumption that 104 might not be agreed to.
Amendment No. 105: Page 26, line 17, after ("impair") insert ("significantly")
Amendment No. 106: Page 26, line 18, at end insert ("other than the services provided by or through the connected apparatus.")
The point at issue is the question of standards of apparatus, and the particular sub-paragraph that I propose to strike out is (8)(b)(ii) on page 26, which talks about impairing the quality of any telecommunication service. The point at issue is not one of standards. They should certainly be maintained but they should be restricted to essentials, particularly in order to encourage innovation and, through innovation, to encourage exports.
What is suggested is that there is no reason for this to be in the Bill. British industry could with advantage be given the right to authorise self-certification on the home market, and then this particular sub-paragraph would not be necessary. If that sensible argument is not accepted, then it would still be necessary to qualify (8)(b)(ii) first in relation to Amendment No. 105 because one must have a practical limitation on the impairing of quality, and so I seek to add significantly to it. But, in addition, one needs to qualify it to make sure that the apparatus does not necessarily include the service provided through connected apparatus.
For example, the user might be satisfied with the transmission or reception at a different standard at his terminal from that which the operator would himself have applied. Therefore, it does not seem reasonable that the third party would control the quality referred to in the particular sub-paragraph. It is really a question of either having Amendment Nos. 104, or 105 and 106 together. At this stage, I beg to move.
Lord Cockfield: I appreciate the point that my noble friend Lord Mottistone is making. The Government's view is that the mandatory standards against which the terminal apparatus must be approved should be what is necessary, but no more than is necessary, to safeguard the staff and property of network operators and to protect the interests of the whole community of subscribers. The noble Lord's amendment rests on the view that in this respect subscribers can look after their own interests without the help of regulation. That is not a view that we could entirely accept.
As my noble friend will know, there has been complaint about the quality of telephone service. British Telecom, through improvements in its trunk networks and elsewhere, is making a major investment to improve its service. These improvements could be lost if the Government were to allow unsuitable terminal apparatus to gain approval and become widespread. Noisy lines and faint speech are important among the causes of unsatisfactory calls.
For good reasons, telephones designed for the United States' market, for example, transmit more faintly than telephones for use here, and if connected here would increase the number of occasions when a call cannot he heard. Problems would not arise on all the calls and users could be unaware of them at the time of purchase, but the effect would be a progressive worsening of service.
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There is also a problem of what is technically known as "network pollution". I am sure that this term is familiar to all your Lordships. Market forces cannot control such network pollution any more than they can control environmental pollution. We believe that a measure of regulation is required. There are, however, defects in Clause 22(8) as drafted. We plan to move amendments on Report. In considering what needs to be done to Clause 22(8)—the defects in it are tenchnical—we shall, of course, give consideration to the points that my noble friend has made. On that basis, I hope he will not press his amendment.
Lord McIntosh of Haringey: I had not intended to intervene. It was only because the noble Lord, Lord Cockfield, referred to amendments which the Government propose to put to this clause and subsection on Report that I think it is necessary to say that, although we agree entirely with his answers to the noble Lord, Lord Mottistone, he has given only half the story. It is not just a matter of the voice lines, but the quality of transmission is particularly important for data transmission. It will be necessary to see in any amendments that are made that the quality of data transmission, on which many millions of pounds may depend, will be fully protected.
Lord Cockfield: I entirely appreciate the point that the noble Lord has raised. I was merely endeavouring to confine the examples I had given to the minimum necessary to make the argument that I was putting forward.
Lord Mottistone: I am grateful to my noble friend for giving consideration to one or more of these amendments in any amendment that he may be putting forward at Report. I beg leave to withdraw Amendment No. 104.
Amendment, by leave, withdrawn.
[Amendments Nos. 105 and 106 not moved.]
Lord Cockfield Lord Cockfield moved Amendment No. 106A:
Page 27, line 11, leave out subsection (14).
The noble Lord said: My noble friend has already spoken to this amendment during consideration of Amendment No. 70A. I beg to move.
On Question, amendment agreed to.
Clause 22, as amended, agreed to.
Clause 23 agreed to.
Clause 24 [Approval etc. of meters]:
12.28 a.m.
Lord Stoddart of Swindon Lord Stoddart of Swindon moved Amendment No. 107:
Page 29, line 8, leave ("sufficiently")
The noble Lord said: I can move this amendment very briefly. I must confess that when I saw this wording, that the meter would be: "sufficiently accurate and reliable", I was concerned that if one has a meter it has to be accurate and reliable. I am concerned to know exactly what will be construed by the Secretary of State as "sufficiently accurate and reliable". If, for example, it is a meter measuring my bill, I would not mind it underscoring 10 per cent.; but

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if it overscored 10 per cent. I should be very annoyed indeed. We have to be absolutely clear that where meters are in operation, whatever those meters may be, "sufficiently accurate" or "sufficiently reliable" just is not good enough. The consumer, whoever he might be, is entitled to believe that if something is being metered and that he is to be charged on the basis of what that meter records, it has to be accurate and it has to be reliable. I shall look forward to hearing what the noble Lord, Lord Cockfield, has to say about "sufficiently".
Lord Glanusk: I tried to speak earlier on this clause in connection with meters. Can we possibly have the definition of this clause improved? "Meters" is a generic term for a large range of measuring equipment, including Avos, voltmeters, ammeters, selective-level meters, some of which cost tens of thousands of pounds. I do not think that this clause is meant to refer to them. If we mean customer-charging meters, can we please say so in the clause and call them toll meters or charging meters?
Lord Cockfield: I should be very happy to look at the question of whether or not further definition of the word "meter" is required. So far as the point raised by the noble Lord, Lord Stoddart of Swindon, is concerned, there is no such thing as absolute accuracy when you are measuring physical quantities. Those of your Lordships who are engineers will remember that variations are always quoted at the same time as a measurement is quoted; that is, the figure is given as "plus or minus" a certain accepted degree of variation about the absolute figure. So that the word "sufficiently" is really intended to reflect the practicalities of life.
There are difficult issues to be considered both in relation to the meters already in use and those which are being developed in connection with the digitalisation of the telecommunications network. Ministers have decided therefore that consultants should be appointed to advise the department on how an approvals regime could be established under Clause 24. The object will be to ensure that practical and cost-effective arrangements are made which will significantly improve consumer protection in this area. The consultants who have been appointed are the Metra Consulting Group. They have been asked to advise on the form an approvals scheme should take and the resources required to put it into effect. In that connection, it may be of interest to know that the department's initial thinking, subject to the consultancy report, is that the main approvals work should be added to the functions of the British Approvals Board for Telecommunications. This is an established and well-known body. Perhaps I might also add that although it was concern about telephone meters which led to the inclusion of Clause 24, one of the questions the consultants will be asked to advise on will be the practicability in due course of extending whatever arrangements they recommend to cover other telecommunication services.
I hope that your Lordships will understand that I cannot at this stage offer further comment on the detailed arrangements which will be made. But we are pursuing this point. We realise the importance of
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having the meters as accurate as it is possible to get them within reason. I think that the right thing to do, if I may say so, is to wait for the consultants' report and to take the decision in the light of that. On the point raised by my noble friend Lord Glanusk, I am now assured that a meter is, in fact, defined in Clause 24 (16) which reads:
"In this section "meter" means any system or apparatus constructed or adapted for use in ascertaining the extent of telecommunication services provided by means of a telecommunication system."
But, as I have said, I will be only too happy to look at the specific comments that my noble friend has made.
Lord Glanusk: May I say that I think that that definition is a little bit woolly, to put it mildly?
Lord Stoddart of Swindon: I must confess that I am still not very satisfied with the reply which was given by the noble Lord, Lord Cockfield; because if I consume 10 units of telephonic time, then I expect to be charged for those 10 units and not 10.5 or 14 or what-have-you. I must say that the word "sufficiently" still worries me. It is a qualification which I think will probably worry many other people as well—particularly bearing in mind that many people have expressed doubts about the present metering policies of British Telecom. However, it is late and I may wish to come back to the matter on Report; but for the moment I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Cockfield Lord Cockfield moved Amendment No. 107A:
Page 30, line 1, leave out subsection (14).
The noble Lord said: Amendment No. 107A is a simple amendment to which my noble friend spoke again on Amendment 70A. I beg to move.
On Question, amendment agreed to.
Clause 24, as amended, agreed to.
Clauses 25 to 27 agreed to.
Clause 28 [Information etc. to be marked on or to accompany telecommunication apparatus]:
Lord Cockfield Lord Cockfield moved Amendments Nos. 107B to 107D:
Page 31, line 21, after ("that") insert ("any description of")
Page 31, line 24, leave out ("the apparatus") and insert ("apparatus of that description")
Page 31, line 26, after ("of") insert ("any")
The noble Lord said: May I move these amendments together? The main amendment, No. 107B, reflects the drafting in earlier clauses where it is recognised that it is desirable to have flexibility when it comes to describing telecommunications apparatus for the purposes of a standard or approval or, in this case, in the context of an order requiring the marking of such apparatus with particular information. The amendment seeks to achieve that flexibility by introducing the words "any description of" before "telecommunication apparatus". Amendments Nos. 107C and 107D are consequential on that change. I beg to move.
On Question, amendments agreed to.
Clause 28, as amended, agreed to.
Clause 29 [Information etc. to he given in advertisements]:
Lord Cockfield Lord Cockfield moved Amendment No. 107E:
Page 32, line 16, leave out from ("in") to end of line 17 and insert ("advertisements of that description")
The noble Lord said: This is a minor amendment designed to improve the drafting. It has no policy significance. I beg to move.
On Question, amendment agreed to.
Clause 29, as amended, agreed to.
Clause 30 agreed to.
Clause 31 [Rating in England and Wales]:
Lord Lyell Lord Lyell moved Amendments Nos. 107F, 107G and 107H:
Page 33, line 28, leave out ("public")
Page 33, line 29, leave out ("Part II of")
Page 33, line 36, leave out ("public")
The noble Lord said: I hope that the Committee will forgive me if I speak to Amendments Nos. 107J, 107K, 107L, 107M, 107N and 107P, as well as Nos. 153A, I 53B and 153C, which are right at the end of the Marshalled List.
Amendment No. 107J: Clause 32, page 34, line 7, leave out ("public")
Amendment No. 107K: page 34, line 8, leave out ("part II of")
Amendment No. 107L: Clause 33, page 34, line 19, leave out ("public")
Amendment No. 107M: page 34, line 23, leave out from ("with") to ("associations") in the line 24 and insert ("such telecommunications operators.")
Amendment No. 107N: page 34, line 25, leave out("such")
Amendment No. 107P: page 34, line 12, leave out("an") and insert ("the")
Amendment No. 153A: schedule 7, page 198, line 16 at end insert—

("1974 c. 7.

The Local Government Act 1974.

In Schedule 3, paragraph 9.";

Amendment No. 153B: Page 198, line 18, at end insert—

1975 c. 30.

The Local Government (Scotland) Act 1975.

In Schedule 1, paragraph 9."

Amendment No. 153C: Page 199, line 54, at end insert—

("S.I. 1977/2157 (N.I. 28).

The Rates (Northern Ireland) Order 1977.

In Schedule 12 Part XII.")

These amendments are all concerned with the same subject; namely, the assessment for rates of telecommunication systems.
This is a complicated matter so I will be very brief. The network of British Telecom consists of posts, wires, cables and ducts, call-boxes and other associated equipment which is at present assessed for rates by a method known as formula-rating. This is a method of last resort and is used only when more conventional methods of assessment are not appropriate. It is particularly used for national networks and, apart from BT's network, the gas and electricity national distribution networks are also assessed in this way. The essential feature of formula-rating is that a formula is used to arrive at an overall rateable value for the hereditament and this is apportioned between the different rating districts. Clauses 31, 32 and 33 of the Bill as it stands enable formula-rating in England and Wales, Scotland and Northern Ireland
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respectively, to be extended to the systems of public telecommunication operators. These are defined in Clause 9 which we have already discussed.
However, on reflection it has been decided that the power to formula rate should be widened to cover the systems of all telecommunication operators licensed under the Bill, not just those designated as public telecommunication operators. These amendments achieve this change and enable formula-rating to be extended, by order, to hereditaments of the description specified occupied by "a telecommunication operator". As your Lordships will recall, we have earlier agreed to amend Clauses 16, 17 and 18 to define a telecommunications operator as a person who is authorised by a licence granted under Section 7 to run a telecommunication system. These amendments do not mean that formula-rating will be used very widely; it is still intended to be a method of last resort where more conventional methods are not appropriate. At present, we intend that only Mercury's system should be rated by formula, but it may be that the conventional methods will not be appropriate for some of the systems that will be constructed in future but will not necessarily be designated as public telecommunication systems. Therefore, it is only prudent to take the power to be able to assess such systems by the formula method.
Amendments Nos. 153A, 153B and 153C are consequential on this change. I hope that that brief explanation has given some indication of our wishes in this matter of formula-rating. Unless any of your Lordships wishes me to go further, I beg to move.
On Question, amendments agreed to.
Clause 31, as amended, agreed to.
Clause 32 [Rating in Scotland]:
12.45 a.m.
Lord Lyell Lord Lyell moved Amendments Nos. 107J and 107K:
[Printed above.]
The noble Lord said: I have already spoken to these amendments. I beg to move.
On Question, amendments agreed to.
Clause 32, as amended, agreed to.
Clause 33 [Rating in Northern Ireland]:
Lord Lyell Lord Lyell moved Amendments Nos. 107L, 107M, 107N and 107P:
[Printed above.]
The noble Lord said: I beg to move formally Amendments Nos. 107L, 107M, 107N and 107P. I spoke to these amendments in connection with Amendment No. 107F.
On Question, amendments agreed to.
Clause 33, as amended, agreed to.
Clauses 34 to 41 agreed to.
Earl De La Warr Earl De La Warr moved Amendment No. 108:
Before Clause 42, insert the following new clause:
("Prohibition on fixing of placards, etc. on public call boxes.
.—(1) A person who, without due authority, affixes or attempts to affix any placard, advertisement, notice, list, document, board or thing in or on any public call box shall be guilty of an offence and liable on summary conviction to a fine not exceeding level 2 on the standard scale.
(2) In this section "public call box" means any structure in a public place in or on which telecommunication apparatus is installed by a public telecommunications operator for the provision of public call box services to members of the public at that place.")
The noble Earl said: The object of this amendment is to put back into the Bill what is now in the 1981 Act as Section 46, but to put it back in slightly narrower terms so that it does not cover a wide range of BT property but only call boxes. It was included in the Bill which fell in the last Parliament for a reason which escapes me, because I have carefully read Hansard. My honourable friend Mr Kenneth Baker dropped it on the insistence of the redoubtable Member for Newcastle-under-Lyme, Mr Golding, perhaps lest he should speak for another 10 hours on the subject. It did not find its way back.
The reasons for this are that placards and advertisements in call boxes can be a nuisance to the public who use them. They can, and do, hide dialing instructions. More importantly, they can, and do, hide emergency instructions; and they can, and will, as they go up, hide the instructions for use by the deaf of the inductive couplers which are being put into call boxes by British Telecom.
I understand that the main users of these advertisements are taxis, but I have to add that there are one or two less seemly uses—for instance, telephone numbers which are to be found there, which no doubt cause offence to a number of worthy citizens. It has been said that this can be dealt with by regulations under the Town and Country Planning Act 1971, but my information is that it is difficult to do so. You have to prove that the object is an advertisement. You can prove that only if you can show that it can be seen from outside the box. In nine cases out of 10 it cannot. Furthermore, I believe that the police are reluctant to use the planning Acts but that they are prepared to co-operate much more under the existing offence as it stands in the 1981 Act. Therefore my suggestion is that it would be good procedure for the Government to consider reinstating this clause. I beg to move.
Lord Mackay of Clashfern: My noble friend has clearly and succinctly mentioned the history of this provision and explained the arguments in favour of the clause. What is not so clear to us is why call boxes of public telecommunications operators should be singled out for this special treatment over and above the provisions of the general law. I am sure all your Lordships recognise the desirability of adopting very strict criteria in deciding whether to have statutory criminal offences. I find it a little difficult to be convinced that this proposal satisfies these criteria. My noble friend has adverted to the proceedings in Standing Committee on the previous Bill and described his impression of them, and I would not wish to go into that. But the result of their deliberations was to drop a somewhat similar provision from that Bill, and the Government thought it best in this Bill to abide by the decision of that Standing Committee. It may be that the noble Lord will
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consider withdrawing his amendment in that situation.
Earl De La Warr: I would not want to press this. I think it was dropped because there was developing an ugly political argument with the Member for Newcastle-under-Lyme suggesting that telephone poles were being used for political purposes. The only other thing I would say is that one of the reasons for including this is that it is there now in the Bill which exists. But I do not want to press it. Having drawn it to the Government's attention, if they do not feel it worth putting in I am happy to withdraw it.
Amendment, by leave, withdrawn.
Clause 42 [Assaults etc. on persons engaged in the business of public telecommunications operator]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 108A:
Transpose Clause 42 to after Clause 46.
The noble and learned Lord said: This amendment is designed to improve the presentation of the Bill by demoting Clause 42 to come after Clause 46. I beg to move.
On Question, amendment agreed to.
Clause 42, as amended, agreed to.
Clause 43 [Improper use of public telecommunication system]:
Earl De La Warr Earl De La Warr moved Amendment No. 108AA:
Page 41, line 35, at end insert ("to imprisonment for a term not exceeding six months or")
The noble Earl said: This is an amendment about which I feel rather more strongly, as your Lordships may appreciate. It seeks to increase the maximum penalty in Clause 43, which now stands at £200. This deals with the extremely unpleasant offence of making calls that are offensive, indecent, obscene or menacing. I do not propose to harrow your Lordships by giving examples, but, believe me, in this dossier I have things which make one's hair stand on end. I think it will be sufficient to say this: there are—I find this an unbelievable figure, but I am assured it is true—no less than an average of 500 reported cases a day, and the number of cases is going up.
The people who do this horrible thing terrify, literally, a very large number of women, most of whom are alone; and it has to be said, too, that on occasions, arising from hanging around schools, they terrify and verbally debauch young children of a very tender age. I am sure your Lordships will agree this is a very horrible thing, unpleasant even to talk about. I gather that frequently when the offence is very bad a technique is adopted which is known as stretching, where you look for and use another offence which carries a greater penalty. I would only add that in the Post Office legislation of 1953 there is a provision which makes letters of the same kind subject to an even greater penalty.
I am very ill-acquainted with the law and I have never been a magistrate, but all my instincts tell me that there is a lot in this and that we should consider

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a maximum penalty which is much higher than the present one. I seek the advice of your Lordships on whether I am on firm ground and whether I have perhaps by chance struck the right level. I hope that the Government will take an interest. I beg to move.
Lord Donaldson of Kingsbridge: I should like to give the noble Earl the advice that he has asked for. There is absolutely no case for extending the causes on which people can be imprisoned. At the moment far too many people are in prison for far too little. Although the offence to which the noble Earl referred is particularly nasty and despicable imprisonment, which involves £7,000 or £8,000 a year expenditure, produces not good but total and absolute harm, as is agreed by everyone. It is ridiculous to bring in imprisonment at this stage for an offence of this nature. I hope that the noble Earl's suggestion will be rejected.
Lord Morris: I hold a totally opposite view. If the sanction is within the Bill it will have an effect on potential offenders. When my noble and learned friend the Lord Advocate answered a previous amendment of my noble friend Lord De La Warr I thought at the time that he had not been in a public telephone box for a very long time indeed. I doubt very much whether he has had any experience in this respect. But one must consider that there are 500 complaints each day, and one would take a multiple of at least 10 times that for the number of offences committed and not reported. As this is the only public general Bill that I have experienced where penalties are not considered by Parliament—remember, this clause was not considered by another place—I consider it important that the Government give this fact some thought. It is a point of considerable worry to British Telecom and I hope that my noble and learned friend will consider this—as I am sure he will—with great care.
Lord Donaldson of Kingsbridge: I do not understand the point which the noble Lord makes. My point is that one should not send people to prison when one knows that it will do no good. Generally speaking, it is agreed that that kind of offence is not influenced by the sanction of prison. I am not clear as to what the noble Lord said in opposition to that. He talked for a while-but I could not understand the direction of his argument.
Lord Morris: I am not in the least surprised that the noble Lord did not understand me because I am not very good at making myself absolutely clear. However, I draw immense comfort from the fact that my noble friends had no difficulty whatever in understanding me. I was particularly getting at the malicious telephone call rather than the obscene telephone call. I wanted to avoid that because it is generally considered rather jokey.
My other point is that the mere presence of the power to imprison undoubtedly will have a deterrent effect on certain people who are inclined to indulge in this particular proclivity. Even though my noble friend believes that it would not have any deterrent effect, I have my doubts.
Lord Donaldson of Kingsbridge: I think that that undoubtedly is quite a wrong description. There is every possible doubt that the kind of person who in a malicious way rings up to damage somebody because he has offended him is affected by the fact that he might be sent to prison. That proposition is extremely hard to justify and is almost certainly untrue.
1 a.m.
Lord Mackay of Clashfern: The Government of course very much appreciate the matter which my noble friend has raised. We entirely appreciate the reason why he has put this matter forward. However, we have a particular responsibility to ensure that before we increase penalties it is the appropriate action. I question whether the type of case that my noble friend has particularly referred to ought to be lumped along with the rather petty cases which can also come under this provision.
There is also the point that the noble Lord, Lord Donaldson of Kingsbridge, made, that my right honourable friend the Home Secretary has made clear his desire to reduce the number of petty offenders in custody. It would not be consistent with that approach to make this an offence which is subject to imprisonment in the petty case.
My noble friend is concerned with the more serious type of case. As he will be aware, the Law Commission is at present considering this whole area and has put forward a proposal to create a new offence which would extend to,
"any person who causes any other person to receive a communication, written or otherwise, which is grossly offensive, or of an indecent, shocking or menacing character, for the purpose of causing needless anxiety or distress to that other person"
Having sought comments from interested parties the Law Commission is now considering whether, and in what form, to make firm proposals. It seems to me that it is in that wider context that we should examine the problems raised by my noble friend, rather than by trying to deal with them in the context of Clause 43 of this Bill which is not really very well suited to the purpose.
I hope therefore that my noble friend will feel able to withdraw the amendment, not because the problem that it deals with is not an important and serious one but rather because the best manner of dealing with it is along the lines which the Law Commission has proposed, which makes a very important distinction between the petty kind of case which Clause 43 is designed to deal with and the much more serious type of case that he has in mind.
Earl De La Warr: I am extremely grateful to my noble and learned friend for the information that he has given mc. I said that I was no expert in the law, and I have to admit that I did not know that the Law Commission was going into this. Of course, he must be right. Although I would object mildly to the description of ridiculous by the noble Lord, Lord Donaldson of Kingsbridge, that is not the point that I want to make. I am most grateful to my noble and learned

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friend for giving the Committee this information. I have pleasure in withdrawing the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 108AB not moved.]
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 108B:
Transpose Clause 43 to after Clause 44.
The noble and learned Lord said: Amendments Nos. 108C and 108E are the principal amendments. Amendment No. 108A, which I have mentioned already, and Amendments Nos. 108B, 108C and 108E all really go together.
Amendment No. 108C: Clause 44, Page 41, line 40, leave out from ("dishonestly") to ("shall") in line 41 and insert ("obtains a service provided by means of a licensed telecommunication system with intent to avoid payment of any charge applicable to the provision of that service")
Amendment No. 108E: Page 42, line 2, at end insert—
("(2) In this section "licensed telecommunication system" means a telecommunication system the running of which is authorised by a licence granted under section 7 above.")
The principal amendments are Nos. 108C and 108E. The amendments seek to amend Clause 44 of the Bill so that the offence of dishonestly using a public telecommunication system with intent to avoid payment will have a somewhat wider implication.
The Deputy Chairman of Committees (Earl Cathcart): We are considering Amendment No. 108B which is the proposal to transpose Clause 43 to after Clause 44.
Lord Mackay of Clashfern: The purpose of this is to facilitate the changes which I am proposing. Amendment No. 108B is the second of these. Amendment No. 108A is the first transposition and Amendment No. 108B is the second. I am saying that Amendments Nos. 108C and 108E are the main amendments. I think it is right to try to explain why we are doing all this, using Amendments Nos. 108C and 108E as the principal amendments, which I shall of course seek to explain. As I say, they are the main amendments and they seek to amend Clause 44 of the Bill, so that the offence of dishonestly using a public telecommunication system with intent to avoid payment will have a somewhat wider application. Amendments Nos. 108A and 108B are purely consequential and seek to transpose the order of the clauses dealing with the offences, so that, if the amendments to Clause 44 are accepted, the Bill will continue to group together the offences connected with public telecommunication systems. I beg to move.
On Question, amendment agreed to.
Clause 43, as amended, agreed to.
Clause 44 [Fraudulent use of public telecommunication system]:
The Deputy Chairman of Committees: In calling Amendment No. 108C, I should inform your Lordships' Committee that, if it is agreed to, I cannot call Amendment No. 108D.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No 108C:
[Printed above.]
The noble and learned Lord said: I have already sought briefly to explain this amendment. I beg to move.
Earl De La Warr: Perhaps I may ask my noble friend whether, as I understand it to be, it is a fact that this amendment meets the point that he will probably have presumed I was trying to make, which was to get the offence extended so that dishonest use of systems applies to cable systems as well as to public telecommunication systems.
Lord Mackay of Clashfern: The answer is, yes. The first objective of the amendments to Clause 44 is to extend the ambit of the offence from public telecommunication systems to all telecommunication systems licensed under Clause 7 of the Bill.
On Question, amendment agreed to.
The Deputy Chairman of Committees: I cannot call Amendment No. 108D. Amendment No. 108E.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 108E:
[Printed above.]
The noble and learned Lord said: This amendment is part of the same package. I beg to move.
On Question, amendment agreed to.
Clause 44, as amended, agreed to.
Clause 45 [Interruption or interference with public telecommunication system]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 108F:
Page 42, leave out lines 6 to 10 and insert ("intentionally modifies or interferes with the contents of a message sent by means of that system")
The noble and learned Lord said: I sought to explain the amendment to Clause 45 when I dealt with the earlier amendments to Clause 18. Perhaps since we are now at this particular point, I should say that, as drafted, Clause 45(1)(a) relates to two criminal offences which were contained in Section 45 of the Telegraph Act 1863. Clause 45(1)(a) deals with the actions of an employee of a public telecommunication operator who intentionally prevents, delays or interferes with the transmission or reception of a message sent by means of his employer's system. That is what this amendment is deleting.
We leave in Clause 45(1)(b), which deals with the situation where such an employee intentionally modifies or interferes with the contents of a message sent by means of his employer's system. The amendment deletes the first offence but retains the second, contained in subsection (1)(b), and of course it has to make some minor adjustments to accommodate that. I beg to move.
Lord McIntosh of Haringey: Our response has to be the same as that on Amendment No. 99R. Although there seems to be considerable improvement in the drafting of Clause 45, the complex argument has only just been made available to us. I am grateful to the noble and learned Lord for allowing me to see his speech on Amendment No. 99R. It is safest if we reserve our position so that we can raise any points when we come to consider Amendment No. 109.
On Question, amendment agreed to.
Lord Denham: I think that we have probably reached a stage beyond which it would be counter-productive to go tonight. I should like to thank all noble Lords who have stayed this long. I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Derwent Valley Railway Bill [H.L.]
The Examiner's Certificate that the further Standing Order had been complied with was ordered to lie on the Table, and the Bill was committed to an Unopposed Bill Committee.
House adjourned at eleven minutes past one o'clock.