Lords Sitting of 29 June 1984

Preamble
The House met at eleven of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Rochester.

NHS: Junior Doctors
Lord Molloy: 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 will initiate discussions with the junior doctors of the BMA on National Health Service cuts, which are causing them concern.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Glenarthur): My Lords, my right honourable friend the Minister for Health has been in correspondence with the Hospital Junior Staff Committee of the British Medical Association about their concern over National Health Service finance and manpower. The evidence cited by the committee was investigated by the department and did not support their claims.
Lord Molloy: My Lords, in thanking the Minister for his reply, I should like to ask him whether he is aware that at their conference the junior doctors passed resolutions expressing grave apprehension about what they consider to be the deteriorating effect of cuts in the National Health Service—for example, bed closures, ward closures, long waiting lists, and, in particular, cuts in the medical and nursing staffs. Their apprehensions are entirely genuine. They are not involved with regard to their pay; their concern is for the patients. We understand the Government share that concern, and, therefore, they should take cognisance of the doctors' views.
Lord Glenarthur: My Lords, I am aware of the views expressed by the committee. but, on the other hand, as I said, there has been considerable correspondence between my right honourable friend the Minister of State for Health and the committee, and the fact is that the claims they make are not substantiated.
Lord Ennals: My Lords, who can know better than the junior hospital doctors, working as hard as they do, right across the country? The committee represents 25,000 junior hospital doctors. Who better than they can know the situation in the National Health Service? Has the Minister read their report and has he seen the resolution, from which I should like to quote two sentences only? One is:
"The quality of patient care is deteriorating as a result of worsening financial crisis in the National Health Service".
The second is:
"that Government expenditure plans will lead to a decreasing proportion of gross national product being spent on health care over the next three years".
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In the light of this, how can the Minister simply lightly say that the evidence they have produced is not substantiated?
Lord Glenarthur: My Lords, the fact is that they make a series of different claims. Another of their claims is that there are many doctors out of work. On many occasions at the Dispatch Box I have answered questions about exactly that, and there is not the evidence to support the claims they make. Certainly I am very happy to let the noble Lord have a copy of the correspondence, which deals very effectively with the claims that they make. Perhaps I ought to say also that I am aware of the fact that yesterday my right honourable friend met the junior hospital doctors committee. I do not know what was the outcome of that, but no doubt they made their claims then, and they would have been dealt with by my right honourable friend.
Baroness Gaitskell: My Lords, is the Minister aware of what the Government are doing in relation to this Question? Have they had experience, as I have had, several times, of the National Health Service and of the people who have been treated by it, as well as those who work in it? They will be doing a really wicked thing if they make cuts in the National Health Service, which looks after patients who do not have a great deal of money. and who, indeed, might not have any money. The NHS looks after patients very well; those working in it are not over-paid. One of the most wicked things that the Government could do would be to attack them and to take action which would harm the hospitals and. indeed, the National Health Service.
Lord Glenarthur: My Lords, I share entirely the noble Baroness's views of the importance of the health service and those who work within it. The fact is that there are improvements that can be made within the health service—there always are—and I am glad to see that the noble Baroness agrees with me. The fact is that the Hospital Junior Staff Committee's claims have not been substantiated, but my right honourable friend the Minister of State for Health has been in consultation with them and has explained the facts to them.
Lord Molloy: My Lords, is the Minister aware that, as has been said, there are throughout Britain 25,000 junior doctors? The resolutions in the report refer to their views of their experiences throughout the country. They work, on average, an 88-hour week. They are not asking for even a halfpenny more. They have joined with the National Association of Health Authorities in stating quite clearly that the £100 million last year had a devastating effect; that over the next three years nothing whatever has been taken into consideration in regard to inflation; and that all this constitutes the biggest threat to the NHS and the patients. The situation can be helped only if all of us believe in our National Health Service and enable it to serve the patients. That is what it was designed for and, a the doctors and health authorities say, we have got to put a stop to the staff losses and under-funding.
Lord Glenarthur: My Lords, if the committee are able to produce any clear evidence, then, of course, my right honourable friend will look into it; but so far they have not been able to do so. So far as excessive hours are concerned, the problem is recognised, and it is being tackled. First of all, the Government have banned on-call rotas requiring junior doctors to be on duty more than one night and one weekend in two. Any such rotas are subject to strict central control, as the noble Lord will be aware. Secondly, last year we asked health authorities to conduct a major review of the continuing need for rotas which were worse than a one-in-three basis, and over the past 18 months they succeeded in reducing these by 20 per cent.—from approximately 5,000 to 4,000. Finally, we expect authorities to keep their rotas under close scrutiny, especially where the doctors concerned spend a high proportion of their on-duty time working, rather than just standing by.
Lord Ennals: My Lords, sometimes one wonders whether Ministers who answer from the Dispatch Box see very much of doctors, nurses and hospitals around the country. I am grateful to the Minister for saying that he will supply a copy of the correspondence which he has had. In return, I shall supply a copy of the correspondence which I have had, which involves not only the Hospital Junior Staff Committee but the British Medical Association itself, in support of them.
Lord Glenarthur: My Lords, if I may respond to the noble Lord, I should like to say that on the question of unemployment among doctors, the BMA distanced itself from what the junior hospital doctors claimed when they made their report last time. As we know, they are about to produce another report, and certainly we shall be very interested to see what it says.
Lord Strabolgi: My Lords, in view of what the noble Lord has said, has anything been done to reduce the very long waiting time that so many patients are having to undergo when waiting for vital operations?
Lord Glenarthur: My Lords, certainly work is being done on that, but of course—
Lord Strabolgi: My Lords, what work?
Lord Glenarthur:—it is strictly another question; but I would be delighted to answer it if the noble Lord would care to table a Question on it.
Lord Molloy: My Lords, is the noble Minister aware that I very much appreciate the detail into which he goes? He does not in any way skimp his replies to any Questions concerning the National Health Service and that is very much appreciated. In so far as the noble Lord has said that correspondence has passed between the BMA's junior doctors and his honourable friend in another place, I should have thought that that was a sufficient basis, after a written exchange of views, to examine matters in detail, which I am sure that both will then find to their mutual advantage on behalf of our National Health Service.

Football Grounds: Safety
11.14 a.m.
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 whether they would consider the possibility of financing safety grants at English 3rd and 4th division soccer grounds.
Baroness Trumpington: No, my Lords, there is no power to do so under the Safety of Sports Grounds Act 1975. This is properly the responsibility of the owners of these grounds.
Lord Gainford: My Lords, I thank my noble friend for that Answer. Is there no provision as regards 3rd and 4th division grounds that suddenly have a much larger crowd of fans than expected? I am thinking particularly of the early matches of the FA Cup and perhaps the Milk Cup when a 1st or 2nd division team may be drawn against one from the 3rd and 4th division at the lower division's home ground.
Baroness Trumpington: My Lords, this situation arises only rarely, but some grounds occupied by clubs in the lower divisions are already designated and would therefore be subject to safety certificate requirements. I understand that in the situation set out by my noble friend it is usual for the small host club to contact the local police, who will advise them on maximum safe numbers that the stadium will hold, plus the number of policemen required inside the stadium.
Lord Stallard: My Lords, that is a very disappointing reply from the noble Baroness. With all due respect. does she really understand the enormity of the problems that face these 3rd and 4th division clubs in the circumstances described? Has she ever in fact been to a football match and does she understand the game?
Baroness Trumpington: My Lords, it is now 12 years since when I was Mayor of Cambridge I kicked off for Cambridge United, since when I have never been to a football match. I am only hoping that I shall not kick an own goal during this Question.

Youth Training Scheme
11.16 a. m.
Lord Kilmarnock: 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 was the number of young people actually participating in the Youth Training Scheme at the last count, and how they were distributed between Mode A and Mode B schemes.
Viscount Long: My Lords, there were about 238,000 young people in training in Great Britain under the Youth Training Scheme at the end of May. About 169,000 of these were on Mode A schemes, and 69,000 were on Mode B schemes.
Lord Kilmarnock: My Lords, I am grateful to the nobleViscount for giving me the information which his noble friend the noble Earl, Lord Gowrie, was unable to give me off the cuff in a supplementary question which I put to him on 19th June at col. 146, although I must say that I do think that he ought to have had it up his sleeve. I should like to ask the noble Viscount two questions. First, to what do the Government attribute the relatively poor take-up of a scheme designed originally for 460,000 young people? Secondly, are the Government satisfied that there are sufficient Mode B places for those who are not suitable for the Mode A schemes?
Viscount Long: My Lords, perhaps I may give the noble Lord and the House a few more figures as regards the numbers in training. In Mode A, in community projects there were 38,349 places; in workshops there were 12,107: and in information technology centres 3,051, totalling 53,507. Mode B is a different category of work altogether. There are 15,000 in B2 of Mode B—15,530—and the total in Mode B is 69,037 which, as I have already said, makes a grand total of 238,083.
Baroness Faithfull: My Lords, does my noble friend agree that a number of Mode B training centres have lately been closed? Does he agree that these training centres are run to deal with the most vulnerable young people who do not fit at this particular time into employment? Has the Manpower Services Commission followed up what has happened to those young people who are now not in employment at all and who have no training centre to attend?
Viscount Long: My Lords, it is sometimes difficult to discover why some of these young people suddenly lose interest in or leave these schemes. Therefore, it is sometimes difficult to arrive at an exact figure. My noble friend mentioned certain schemes closing down. I shall write to my noble friend in that respect because I do not know the reasons for that at this moment.
Lord Kilmarnock: My Lords, is the noble Viscount able to tell us why there has been a decline in the number to 238,000 at the end of May from the figure given by the Manpower Services Commission at the end of April of 246,000? Does not the noble Viscount agree that there has been a decline over the last two months of 8,000 people on these schemes? Can the noble Viscount give any explanation for this and would he not think that it might possibly be because of the decline in the number of Mode B places?
Viscount Long: My Lords, to answer the latter part of the noble Lord's supplementary question, that could be possible. The MSC recently carried out a small sample survey of young people who left schemes by mid-November—that is, before completing a year in training—a copy of which is in the Library.
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survey indicates that three months after training nearly 40 per cent. were in jobs: nearly 30 per cent. were in youth training schemes and at that point less than 25 per cent. were unemployed. Although the noble Lord wonders why there has been the decline, these results show that there is some reason for encouragement at this stage.

Aircraft Replacement: Collaborative Project
11.21 a.m.
The Earl of Kinnoull: 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 progress is being made on a successor to Tornado aircraft with our European partners.
The Parliamentary Under-Secretary of State for the Armed Forces (Lord Trefgarne): My Lords, I apologise in advance for the fact that this Answer is rather longer than is normal. I assume that my noble friend is referring to the Royal Air Force's need for a new aircraft to replace its Phantoms and Jaguars in the mid-1990s. Last December the chiefs of the air staffs of France, Germany. Italy, Spain and the United Kingdom agreed an Outline European Staff Target for a European Fighter Aircraft. In January the governments of those countries commissioned their aeronautical industries to undertake studies into the viability of meeting their joint requirement on a collaborative basis, and supplementary studies were commissioned in May. Officials of the five countries are continuing their discussions on the industrial reports and will submit recommendations to the five defence Ministers, who plan to meet shortly to review the position and to decide the way forward.
The Earl of Kinnoull: My Lords, I am grateful to my noble friend for that informative reply. Can he indicate the likely British share in this important collaborative project. the likely cost of the programme, and whether the British engine, which I understand could be suitable for this aircraft, is likely to be selected?
Lord Trefgarne: My Lords. it is not yet possible to say precisely what share of this project will fall to the United Kingdom, but it will certainly be a very important share and I am clear that the project is a very important one for British Aerospace. As for the total costs of the project. the Government are not yet in a position to give their own figures on this matter. but I understand that the industries concerned estimate that the total cost of the project up to the production stage would be about 6 billion Ecus, and that thereafter the aircraft would cost between 15 million and 17 million Ecus each.
Lord Boston of Faversham: My Lords, in saying that it is hoped that the British share will be an important share, can the Minister say whether the implications for jobs in this country arising out of the new aircraft

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will also be important and whether that is one of the factors that he is taking into account? Is he also able to say whether the forthcoming consideration being given by Ministers is to take place in the very near future and whether that meeting will actually result in a final decision being taken?
Lord Trefgarne: My Lords, the Government are certainly taking into consideration the employment implications of this matter, which is why I said that the project would be a very important one for British Aerospace. As for the timing of future consideration of this project, I understand that a meeting has been tentatively set for 9th July to take place in Madrid. If that meeting goes ahead, we very much hope that important decisions will be taken.
Lord Leatherland: My Lords, is the Minister aware that he has referred to Ecus? I have just searched my pockets and I can find no coins of that denomination there. For the benefit of people who read the newspapers, will the noble Lord explain what Ecus are?
Lord Trefgarne: My Lords, when a project involves no fewer than five European nations, as this one does, I suggest that it is better to use the European unit of account, and it is that to which I was referring.
Lord Bruce of Donington: My Lords, is the noble Lord aware that at today's price of the Ecu, which is £0.59413, to the nearest pound, the figure that he has given is £3,565 million?
Lord Trefgarne: My Lords, I am happy to receive those figures from the noble Lord, but if they continue to be valid in five or ten years' time, when the project gets under way, that may be a different matter.
Lord Renton: My Lords, will not the British contribution towards this project eventually have to be expressed in the Estimates, or in some form of public accounts, in terms of pounds sterling? Would it not be better. therefore, if we were kept informed in that way?
Lord Trefgarne: My Lords, I shall certainly be willing to explain these figures to my noble friend in the form in which he suggests as soon as the Estimates are available.
Viscount Mersey: My Lords, whatever the unit of currency being used, is it not the case that the new plane will be considerably cheaper than the Tornado?
Lord Trefgarne: My Lords, present estimates are indeed encouraging.
The Earl of Kinnoull: My Lords, does my noble friend have any information on the engine content of this project?
Lord Trefgarne: My Lords, I apologise to my noble friend for not referring to this because I think that he put that question to me earlier. The engine to be fitted to this aeroplane has not yet been finally decided, but
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one of the contenders is certainly a development of the RB.199 engine which is presently fitted to the Tornado. However, the French also have an engine which they are considering.

GLC and Metropolitan County Councils: Election
11.26 a.m.
Lord Denham: My Lords, with the leave of the House, I shall now repeat in the form of a Statement the Answer which has been given to a Private Notice Question in another place on the Government's intentions about elections to the GLC and metropolitan county councils. The Answer is as follows:
"The Government are considering and will announce in due course how they intend to handle the question of these elections. There are a number of options for dealing with them, and we will make known our proposals in good time to enable Parliament to make up its mind on the issues. In the meantime, let me make it abundantly clear that we remain firmly resolved to fulfil our election commitment to end these unnecessary and expensive upper-tier councils".
Lord Ponsonby of Shulbrede: My Lords, I should like to thank the noble Lord the Chief Whip for repeating the Answer to the Private Notice Question put in another place earlier today. The vote yesterday was won on a fundamental issue of principle. On an earlier occasion the Leader of the House described a Government majority of 20 as being substantial. On that basis, I would submit that the vote yesterday was a massive defeat for the Government.
The Government should not attempt hastily to reject the decision of this House. To do so would be an unacceptable act of what the noble and learned Lord the Lord Chancellor himself has described as an "elective dictatorship". The Government's election commitment was not to transfer power for an interim period to an unelected body. I hope that the noble Lord will keep the House fully informed of any decisions that the Government intend to make on this matter.
Lord Wigoder: My Lords. I too should like to thank the noble Lord the Chief Whip for his repetition of that Statement. We are grateful to him for keeping us informed and we look forward to future developments with very considerable interest. At this stage I should like to raise two matters. First, can the noble Lord, Lord Denham, inform us whether the Government agree with the observations made by his noble friend Lord Whitelaw last night? The noble Viscount, after reflecting upon the matter for some hour and three quarters after the end of the Division, announced at col. 1096 of Hansard:
"The amendment that has been passed is not a wrecking amendment. I think that it is important to recognise that particular point".
Is that still the view of the Government?
The other matter that I would bring to your Lordships' attention is this. Is the noble Lord, Lord

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Denham, aware that in the other place this morning one of his Conservative Party colleagues has apparently indicated that what this House did yesterday was totally undemocratic, and apparently he indicated that in future all good Conservatives should join with all good Socialists and together call for the abolition of your Lordships' House?
Lord Denham: My Lords, I should like to thank the two noble Lords opposite for their response. In reply first to the noble Lord, Lord Wigoder, I cannot confirm what happened in another place because I thought it right to be in your Lordships' House at this time. I wish that noble Lords opposite could get their act together.
Noble Lords: Oh!
Lord Denham: My Lords, in winding up not only for his Alliance friends but also, as he made quite clear, for the official Opposition, last night the noble Lord, Lord Hooson, said:
"This amendment is not a wrecking amendment at all. It is an amendment that is couched deliberately out of the terms in which the Bill itself is couched. It is not a wrecking amendment. It is a significant amendment, because it restores what I believe is the proper constitutional position." [Official Report, 28/6/84: col. 1066.]
Later in the evening in another place. the right honourable gentleman who sits for Bethnal Green and Stepney said:
"The Government were defeated on an amendment which disembowels the entire purpose of the Local Government (Interim Provisions) Bill." [Official Report, Commons, 28/6/84: co1.12521
Which is it? It cannot be one thing before the Division and another after the Division.
Baroness White: My Lords, would the noble Lord agree that it is not proper in this House to quote verbatim from another place except the words of a Minister?
Lord Denham: My Lords, it is possible, I understand, to quote verbatim from words given from the Opposition Dispatch Box.
Lord Harmar-Nicholls: My Lords, is my noble friend aware that while this House in Committee yesterday did its duty according to its lights, the result was to frustrate Government action for which they had a mandate?
Noble Lords: No!
Lord Harmar-Nicholls: Under those circumstances is my noble friend aware that many of us will not be surprised if the other place, quite legitimately—as legitimately as our position—will "unfrustrate" it in order to put themselves in the position where they can carry out their mandate, and perhaps replace the existing words with the words put down in Amendment No. 10A by the noble Earl, Lord Halsbury? If that happens it will not be the first time that the Cross-Benches have cut across the rigid partisanship which clouds an issue and have the real answer in the interests of the nation.
Lord Denham: My Lords, this House has often in the past exercised its undoubted right to ask another place to think again. This is what your Lordships did last night. When my noble friends were in opposition we never even claimed parity with another place, let alone superiority or domination, and now extravagant things are being quoted. I do not believe everything I read in the papers, but may I quote what was said of the Opposition Chief Whip last night:
"Labour's chief whip, Lord Ponsonby, said amid popping champagne corks: With a majority of 48 it would be quite foolish of the Government to try to overturn the judgment of this House'."
It is quite proper for your Lordships to ask another place to think again, and sometimes it does think again; but it would be totally improper to deprive another place, just because your Lordships have passed an amendment, of even the opportunity of considering it.
Baroness Seear: My Lords, may I remind the noble Lord the Chief Whip that we on these Benches have no responsibility whatsoever for anything that is said by a Labour Member in another place. To be told to get our act together with them is something we do not accept.
Lord Denham: My Lords, the act was fairly firmly together last night.
The Earl of Lauderdale: My Lords, could my noble friend clarify one matter? In so far as the events under consideration took place in this House, would it not have been more proper for the substantive Statement to have been made here and repeated in another place? Can this he so in future on this particular matter?
Lord Denham: My Lords, there is always the delicate matter of comity between the two Houses. I understand what happened in this case was that a Private Notice Question was put down in another place and was allowed by Mr. Speaker, and was therefore repeated here. I do not think that this interferes in any way with the comity between the two Houses.
Lord Elwyn-Jones: My Lords in the matter of comity. may I inform the noble Lord the Government Chief Whip in the House—as he was good enough to correct me a little while ago in a fluent moment in a speech because I summarised what a former Conservative Minister had said in another place—that the rule of the House is apparently:
"The content of a speech made in the House of Commons in the current session may be summarised, but it is out or order to quote from such a speech unless it be a speech of a Minister in relation to Government policy."
For once the Chief Whip has erred, no doubt quite innocently.
Lord Denham: My Lords, I am most grateful to the noble and learned Lord. I assure him that it was totally innocent and out of a mistaken belief which I shall not fall into again.
Lord Galpern: My Lords, can the noble Lord explain to the House what we are to understand by the declaration by the Leader of the other place that the Government would test the strength of the other place against that of the House of Lords?
Lord Denham: My Lords, I have the exact words here. My right honourable friend said:
"The House will realise that the Bill will return to this House so that it may pitch its authority alongside that of the other place."—[col. 1253]
The end of the quotation—because it is unfair to take things out of their context—is:
"Furthermore, fair-minded Members will recognise that the Government will wish to take a due and measured course in considering their judgment."—[col. 1253]
This House, if I may say so, has pitched its authority alongside another place. Is the noble Lord opposite denying another place the right to return the compliment?
Lord Jenkins of Putney: My Lords, when the Government consider this question next week, will they consider that their mandate was part of a mandate containing many more even more important issues, and certainly that it contained no element within it to provide that the Government would abolish an elected body before deciding what was to go in its place? In considering that will they also take into consideration that all measurements of public opinion since then have shown that the vast majority of people want to retain these bodies, including possibly even a majority in the noble Lord's own party?
Lord Denham: My Lords, I hope that noble Lords opposite, and their right honourable friends in another place, will refrain from issuing promissory notes as to the status of this House which they do not intend to redeem in full when they themselves are next in power and in a position to do so.
Lord Molloy: My Lords, I am sure that the noble Lord the Chief Whip will not recall it, but if he reads Hansard he will see that I used the same words that he used in my speech. My contribution was to get the Government to at least think again. Throughout our country this morning this is the top political issue. Could not the Government Front Bench in this noble House state clearly, honestly, and categorically that in view of the vote last night they will most sincerely think again, taking full cognizance of the views expressed in this House, of councillors of all political parties who agree with the majority view last night, and consider that to be something which they must think about deeply and arrive at a fair and just decision, taking into consideration all the views that I have mentioned?
Lord Denham: My Lords, that is implicit in the original Statement that I repeated.
Lord Mowbray and Stourton: My Lords, is it not possible that after another place has considered what happened and that when it comes back to this place, the other 95 noble friends who voted on Second Reading might decide to return and support the Government?
Lord Denham: My Lords, of course everything is possible.
Lord Strabolgi: My Lords, may I ask the noble Lord whether he recollects that during the last Parliament the amendment on school transport was passed against
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the Government's wishes by an even larger majority, and in that case the Government bowed to the clear view of this House? Will they now follow that excellent precedent?
Lord Denham: My Lords, I must make it absolutely clear, and I think that this is beyond doubt, that it is the privilege of this House to ask another place to think again. It does think again. On occasion it agrees with this House, and on many other occasions—and particularly in the times when noble Lords opposite are in power—it disagrees with this House. That is the constitutional position, and there is no possible way in which your Lordships can suggest that this House should invariably be dominant over another place.

Child Abduction Bill
11.40 a.m.
Baroness Faithfull: My Lords, I beg to move that this Bill be now read a third time. In so doing perhaps I may thank those noble Lords who took part in the various stages of the Bill in your Lordships' House. I believe that it returns to the other place and to its promoter, Mr. Timothy Wood, the Member of Parliament for Stevenage, an improved Bill.
During the passage of the Bill the noble and learned Lord the Lord Chancellor gave a fascinating discourse on the history of kidnapping. The noble Lord, Lord Mishcon, aired controversial matters, while strongly and wholeheartedly supporting the Bill. My noble friend the Minister assisted me and the noble Lord, Lord Meston, made a notable maiden speech. I am grateful to the civil servants for the help which they gave me.
Finally, the whole House will be grateful to the noble and learned Lord, Lord Scarman, for moving an amendment at a latter stage of the Bill following the judgment on the Daily case, thus adding consistency to the Bill. We are, as a House indeed grateful to him.
Moved, That the Bill be now read a third time.—(Baroness Faithfull.)
Lord Mishcon: My Lords, one of the difficult tasks of the House is to find different words with which to express our gratitude sincerely to the noble Baroness, Lady Faithfull, on the many occasions on which we do so. This is a further such occasion and I wish to thank her most heartily and to thank the Minister for his unfailing courtesy to which we are absolutely accustomed.
It was my privilege to try to put some testing amendments in regard to the Bill. Although it was a Private Member's Bill, there was united support for its principles. It was right that we had the discussions we had and I agree with the noble Baroness that the Bill goes back to another place in a better state than it was.
The Lord Chancellor (Lord Hailsham of Saint Marylebone): My Lords, perhaps I may just congratulate my noble friend on having carried a Private Member's Bill through the House. It is always rather enjoyable when one is on the Back-Benches, so to speak, and she has done it so well.
On Question, Bill read a third time, and passed, and returned to the Commons with the amendments.

Data Protection Bill [H.L.]
11.43 a.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Elton): My Lords, I beg to move that the Commons amendments be now considered.
Moved, That the Commons amendments be now considered.—(Lord Elton.)
Lord Mishcon: My Lords, I wonder whether upon that Motion I may be permitted to raise one point against the background of which we shall be considering amendments generally and this Bill, in so far as we can on this occasion. The Secretary of State for the Home Department in the other place and the noble and learned Lord the Lord Chancellor in this House both intimated—I am sure they had complete belief in what they said—that it was not possible to ratify the convention until legislation had been passed by Parliament and the machinery of that legislation had been put into force. For that reason there was a period of two years' delay, apart from anything else, as we understood it, for the convention to be signed.
I have intimated to the noble Lord the Minister that at a recent international convention, at which the Home Office was represented, the Governments of Spain and Portugal had taken it for granted, on the advice they received, that they could sign the convention provided only that they intimated an intention to legislate, and that the Act itself had not to be on their statute books—if that is the proper way to describe the manner in which they deal with their legislation. In view of the authoritative view that was given in both this House and another place, I wonder whether the noble Lord the Minister can offer any up-to-date guidance. If it were possible to sign the convention even now—and that is the practical point—and to do so immediately, it would obviously be right to do so.
Lord Simon of Glaisdale: My Lords, I hesitate to intervene when I played no part in the discussions on this Bill, but I have always understood that the British constitutional position was that we ratify intending to legislate. Having ratified, we are under a duty to legislate, but we are not bound to postpone ratification until after legislation.
Lord Elton: My Lords, I am most grateful to the noble Lord, Lord Mishcon, for his thoughtful warning of this question, which would otherwise have left me in some difficulty. As the noble Lord has said, the convention has been ratified by Spain before legislation is actually in place in that country. But like any other member of the Council of Europe, Spain must do what it thinks right. That applies to Portugal as well. Spain has certain provisions in its constitution which it regards as relevant in this matter. For our part we take the view that we cannot ratify the convention without data protection legislation in force. That is due to the particular circumstances of the case.
Article 4.1 provides that a party to the convention,
"shall take the necessary measures in its domestic law to give effect to the basic principles for data protection".
Article 4.2 provides that,
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"those measures shall be taken at the latest at the time of entry into force of this convention in respect of that party".
In the United Kingdom context that quite clearly means to us that we must have legislation in force before we ratify. There are not, I think, two ways about it. It is in the provisions of the convention itself. Of course it is not for me to judge what is required in the Spanish or any other European context.
Lord Mishcon: My Lords. I am most grateful to the noble Lord the Minister and I am very glad that his observations are now on record.
On Question, Motion agreed to.

COMMONS AMENDMENTS
[References are to [Bill 51] as first printed for the Commons).
1 Clause 1, page 1, line 14, after ("information") insert ("or from that and other information in the possession of the data user").
2 Page 2, line 4, after ("processed") insert ("by or on behalf of that person").
3 Page 2, line 8, at end insert—
("; and
(c) the data are in the form in which they have been or are intended to be processed as mentioned in paragraph (a) above or (though not for the time being in that form) in a form into which they have been converted after being so processed and with a view to being further so processed on a subsequent occasion.").
4 Page 2, line 16. leave out from ("for") to end of line 17 and insert ("the processing as mentioned in that subsection of data held by them.").
5 Page 2. line 27, at end insert ("; and where the identification of the individual who is the subject of personal data depends partly on the information constituting the data and partly on other information in the possession of the data user, the data shall not be regarded as disclosed or transferred unless the other information is also disclosed or transferred.").
Lord Elton: My Lords. with the leave of the House, I beg to move that the House doth agree with the Commons in their Amendments Nos. 1 to 5 en bloc.
These five amendments all modify the definitions of some of the basic terms of the Bill. In each case the basic concepts remain the same, but the amendments are designed to clarify points which might otherwise have given rise to ambiguity, and to stop up any potential loopholes. Amendments Nos. 1 and 5, the first and the last of the group. go together. Amendment No. 1 elaborates the Bill's definition of personal data as cast. Clause 1(3) defines personal data as information about a living individual who can be identified from the information. If it were left there, however, it would be possible for an unscrupulous user to evade the Bill's control by devising a personal code for all data subjects and using manual records as a key to translating the code into names.
Amendment No. 1, therefore, requires that all the information in a user's possession must be taken into account when deciding what is and what is not personal data. But where the information on the user's computer does not itself identify subjects and only that information is disclosed or transferred to someone else without the identifying key, the data are effectively anonymised and present no threat to any data subject. Amendment No. 5 recognises this and takes any disclosure or transfer made in these circumstances outside the Bill's scope.

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Amendments Nos. 2 and 3 define the crucial definition of a data user as a person who holds data. Without Amendment No. 2 a person could be a data user without ever having processed or without ever intending to process personal data. For instance, if he possessed a sheet of typescript which someone had previously fed into an optical character reader, he would be a data user by virtue of controlling the content and use of data which had been automatically processed. The amendment, therefore, ensures that only a person who both controls the contents and uses the data and is himself responsible for the processing of the data or having them processed on his behalf may be a data user.
The amendment's companion, Amendment No. 3, makes it clear that a person holds data only when they are in the form in which they have been, or are intended to be, processed. Thus, if the data user has on his computer the names and addresses of his employees but also happens, quite independently, to keep the same information on a conventional file, the effect of the amendment is that he does not hold the information on the conventional file so far as the Bill is concerned. The only exception is the case in which data are transferred from one medium to another for storage purposes with the intention of reconverting them to the original medium when they next need to be processed. This is a common practice in the computer world and it is important that the data should remain within the Bill's scope while they are being stored in this way.
Finally, Amendment No. 4 operates on the definition of a computer bureau. A computer bureau is defined in subsection (6) as cast as someone who processes data on behalf of other persons or who provides equipment for other persons to process data with. The effect of this, however, could be to make into a computer bureau a person who retained control over the contents and use of data but who rented out terminals to third parties who are allowed, for example, to process the data in the sense of extracting information from the data. The Lexis system is an example of such an arrangement, as is the system whereby banks allow their customers access to terminals to interrogate their accounts. I believe that you can now do this standing in the street. In such cases the person providing the services is not really operating as a bureau in the true sense since he actually controls the contents and use of the data whereas a bureau does not.
The amendment therefore makes the distinction between a data user who controls the content and use of the data and the operator of a computer bureau who does not, much clearer. I hope that my speech has had the same effect. I remember from our initial stages what a tangled thicket this matter of definition is. I think that the other place has actually made a few pathways through it a little clearer. I hope your Lordships will agree that they should stand in the Bill.
Moved, That this House doth agree with the Commons in the said amendments en bloc.—(Lord Elton.)
Lord Mishcon: My Lords, the House will be grateful to the noble Lord the Minister for his comments. I have nothing additional to say.
Lord Mottistone: My Lords, perhaps I may say a brief word. It strikes me that the other place has made a splendid job of improving the improvements that we made in practically all, and in particular these, amendments that we have just heard about. They really ought to be congratulated as being a first-class revising Chamber for this purpose.
Lord Elton: My Lords, I hear the last three words of the noble Lord's speech in the context of what it followed. It is nice to say friendly and grateful things about the other place and also trusting things. I am grateful to your Lordships.
On Question, Motion agreed to.

COMMONS AMENDMENT
6 Clause 2, page 3, line 12, at end insert—
("(4A) An order under subsection (3) above modifying the third data protection principle may, to such extent as the Secretary of State thinks appropriate, exclude or modify in relation to that principle any exemption from the nondisclosure provisions which is contained in Part IV of this Act; and the exemptions from those provisions contained in that Part shall accordingly have effect subject to any order made by virtue of this subsection.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 6. This amendment was moved by the Government in another place—I hesitate for a moment: is this the amendment to which my noble friend has an amendment and will she be speaking after'? I have misunderstood the procedures. That curtails what I shall say now. If your Lordships find that I explain anything at too much length or detail I shall be happy in the later stages to curtail it, but I think that we should have on the record the basis in this House of what was done in the other place.
This amendment was moved by the Government in another place in response to representations from the health professions and others for special measures to regulate the disclosure of health data. Health data are specially sensitive. The Bill already recognises this by providing the power in Clause 2 for the Secretary of State to make an order modifying or supplementing these principles in order to provide additional safeguards in respect of such data. Health data are also different for another reason. They may often for perfectly legitimate reasons pass from the control of the health professional who originated them. Thus, within the National Health Service, it is technically the health authority which controls medical records. Also there are circumstances in which the employer may hold health data about his employees or in which an educational establishment may hold health data. Similarly health data may be disclosed and used for research purposes.
In all of these circumstances, although the subject is entitled to expect his data to be properly protected, he does not necessarily have the guarantee that any decision about their disclosure will be taken by a responsible health professional. This is a matter of some concern to the health professions who are anxious to ensure that the trust between a patient and his doctor or other professional is not undermined. My right honourable friend the Secretary of State for Health and Social Services therefore has agreed to consider the issue of directions under the National

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Health Service Act requiring health authorities to comply with a code of guidance which will set out the circumstances in which health data may be disclosed and will make it clear that, generally speaking, the consent of the patient will be required before data are disclosed. In other limited circumstances the consent of the responsible professional may, instead, be required, including, for example, where the disclosure is to the police. Such a direction will of course apply only to the health authorities. It was in order to ensure that similar restrictions could be imposed on the disclosure of health data held outside the National Health Service that this amendment was brought forward.
As I have already said, Clause 2 allows the Secretary of State to make an order supplementing or modifying the principles as they apply, among other things, to health data but as Clause 2 originally stood any order which amended the third principle relating to the disclosure of data would still have been subject to the exemptions from the nondisclosure provisions; so that although the order might say that health data may not be disclosed without the consent of the patient or the responsible professional. Clause 28(2), for example, would have been capable of overriding this restriction.
The amendment therefore provides specific power for the Secretary of State to modify or override the exemptions from the nondisclosure provisions in any order modifying the third principle. The intention is to use this provision to make an order placing restrictions on the disclosure of health data similar to those contained in the code of guidance being prepared by the Department of Health and Social Security in consultation with the health professionals. This amendment meets the concern expressed in many quarters about the need to provide additional safeguards in relation to the disclosure of health data and I accordingly commend it to your Lordships.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
Baroness Faithfull Baroness Faithfull moved:
That this House do agree to the Commons Amendment 6 with the following amendment:
Line 8, at end insert—
("; and any order made by virtue of this subsection may exclude or modify in relation to that principle exemptions from the non-disclosure provisions in respect of sensitive data consisting of information as to spiritual counselling, or social work or similar activities involving counselling as to personal welfare.")
11.58 a.m.
The noble Baroness said: My Lords, in moving the amendment set down in my name on the Order Paper, may I say that I do agree with the amendment to which my noble friend the Minister has just spoken. But I wonder if it is fully appreciated that what my noble friend the Minister has just said is to safeguard confidential data of a medical nature. I wonder, again, if it is fully appreciated that this is not fully implemented. If I may, I will say why. My Motion before your Lordships House today seeks to do two things: first to safeguard the disclosure of confidential information given to social workers in the course of their duties by those seeking advice, support and help
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of a practical nature. Secondly, this amendment of mine seeks to implement fully the amendment to which my noble friend has spoken.
In order to explain this, may I for a moment outline the duties of a social services department? May I say that social work and medical work are inextricably interwoven and that one cannot operate without the other. The information of one cannot operate without the information of the other. For instance, the social services department is responsible for, let us say, the adoption categories. One cannot place a child for adoption without highly sensitive confirmation from a doctor of the health of the baby, of the health of the mother who is unable to have a child and of the health of the mother wanting to place the child. That information must be sought, and can only be sought, from a doctor. The report of the doctor is on the social work file and therefore the doctor's advice is taken but there are, of course, other factors.
There are social factors, as to whether the couple have the capacity to look after a child, whether they are capable of bringing up a child; but in the first instance it is upon the medical report that the social workers depend. Take, for instance, the Chronically Sick and Disabled Persons Act 1969. The doctors make the medical recommendation as to what the patients require—alterations to their house, various implements which they need or perhaps admission to a home. That medical report must go on the social worker's file because the social worker would otherwise probably not know how to implement the doctors recommendations.
Then we have the Mental Health Act. The doctors and the social workers must work closely together. The social workers cannot arrange admission to a mental hospital without the recommendation of the doctor, and that must be on the file. Therefore, the social workers are implementing what is set out by the doctor. Then there are various court cases, of children who have been abused by their parents. If a case is taken to court it is necessary to have a medical report on the state of the child in order to present both the medical and the social background of the case: without a medical report one cannot possibly take a case to court, and probably the child will not be helped but possibly even further damaged.
Then, with the elderly, we have recommendations by the doctors as to what should happen to them, and some of the things that the doctors recommend are very serious. If there is a confused, incontinent, elderly person, the doctor has to state that on the file and on the medical report and must make a recommendation to the social services department on what is the best help to be given to that elderly person. I hope that, by briefly covering the role of the social services department, I have shown your Lordships that the medical and health departments are inextricably interwoven and one cannot do without the other.
I now turn to the whole question of administration. About half the local authorities in this country have data on computers from the social services departments. Those computers are not held in the social services departments. They are held possibly in the chief executive's department or in the treasurer's department, and the people servicing the computer

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may be asked for information. Information may be given from the computer quite without the knowledge of the social services department. They do not control what information is given from the computer.
Then, I come to the question of the position of social workers in a local authority. Social workers are the servants of the council for which they work; and in a notable case relating to Birmingham District Council—the Old case—it was ruled that, because workers were the servants of the council, the members of the council had the right to see the papers. If the members of the council have the right to go to the computer and ask the operator for information, the operator, who also is a servant of the council, will in all probability give that information. That will include not only social work information; it will also include medical information. Therefore, the doctors will not be safeguarded and the doctors' data will not be safeguarded as Amendment No. I sets out to do.
When I was president of the Association of Children's officers many years ago, there were at that time—I believe it was 1969—various difficulties as between the medical profession and the social work profession, As president of the association I went to see the BMA. The BMA at first said that there was no question of their divulging confidential information. However, a very good relationship was worked out as between the social work profession and the BMA, and I believe I can honestly say that over the years that relationship has been built up, and the doctors have been prepared to give the social work departments confidential information, for the sake of their patients if for nothing else. Therefore, I feel that the trouble about this amendment which the noble Lord has moved is that, while we thoroughly approve of it, it really does not go far enough.
Finally, from the point of view of social workers, a great deal of confidential information is given to them under the different Acts. My noble friend the Minister has talked about medical information being very sensitive. When one is dealing with, for instance, divorce or the custody of children or wardship cases, the information given is indeed extremely sensitive, and, if the social workers lose the confidence of their clients, then those clients will be the worse off and will not have the help that they should have. I very much hope that my noble friend the Minister will take this into account, realising that for the following three reasons this matter should be looked at again: first, this should be done for the sake of the doctors; secondly, for the sake of social workers; and thirdly and most important of all. for the sake of the clients. I beg to move the amendment to the Commons amendment.
Lord Kilmarnock: I hesitate to intervene in a debate on the Data Protection Bill, in which I took no part, but, as the noble Baroness, Lady Faithfull, has been kind enough to ask my support for her proposal, I thought I should go into the matter a little. It seems to me that, if the Government are intent on safeguarding the confidential information of the health professions, they will have to ask themselves whether this phrase "health professions" is really adequate to the realities of the contemporary scene. The noble Lord, Lord Elton, will of course be aware that health authorities and social services departments are now intimately
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linked in all kinds of ways, particularly under the joint financing arrangements for care in the community, which in some cases under the tapering arrangement will mean that they will, so to speak, be coupled together over a period of something like 10 years.
As the noble Lord himself will also be well aware, there is the whole question of mental health care. He will recall from the many hours that we spent on the Mental Health Act in your Lordships' House that a new role emerged for social workers under that Act in that particular field of mental health. Then, as the noble Baroness, Lady Faithfull, has said, there are the medical reports on which social workers depend and which will be in their possession. As she also pointed out, many local authorities actually store their confidential social work data on a mainframe computer which is shared by other departments in the same authority.
The concept of the phrase "health data" is something which is constantly being expanded. I understand from the Royal College of General Practitioners—which is a body with very high standards for which I have the very greatest respect—that they have recently recommended that "health data" should be expanded to include such information as broken engagements, bankruptcy, broken marriages, loss of jobs and bereavements. These have all been added to the standard international classificaton of diseases by the Royal College of General Practitioners as part of a revised coding of diseases and treatment suitable for use on a computer. Therefore I would submit that the phrase "health data" covers an area which is constantly being updated and is on the move.
We all know the noble Baroness, Lady Faithful], well enough to know that she always makes practical suggestions out of her very extensive experience in social services departments. It seems to me that she has made a very good case on practical grounds because of the increased linkage, which I have also endeavoured to underline, between the health authorities and the social service departments. Under the Government's own plan for care in the community, the relationship between these two types of authority will, if anything, increase rather than the opposite. Therefore, for all those reasons I think that the Government really should listen very carefully to what the noble Baroness has said and see whether they cannot accommodate her suggestion.
12.12 p.m.
Lord Mottistone: My Lords, I should like to support my noble friend Lady Faithfull. All the arguments she advanced are of the kind which have been put to me by the Natonal Society for the Prevention of Cruelty to Children, on whose central committee I sit, as being their concern. They have exactly the same problem. I think, from the wording of my noble friend's amendment, that it covers that sort of nonprofitmaking body as well as social services of an official nature—I would hope it would—but the principle that she was on is exactly the same as for the NSPCC and I hope that the Government will be able to accept this amendment or, if not this, something very like it.
The Lord Bishop of Rochester: My Lords, I should like to follow the last speaker and support both the Minister's amendment and also the amendment of the noble Baroness, Lady Faithfull. She has spoken of the closely-integrated nature of the social and the medical work. There are others in the field, of which the noble Lord has just mentioned one, and there are other volunteer agencies such as the Marriage Guidance Council, conciliation services and the day-to-day counselling by ministers of all denominations. This is a constantly changing scene, but I think it is part of the picture which the Government ought to take into account in these revisions.
Noble Lords will notice that the amendment includes the words:
"non-disclosure provisions in respect of sensitive data consisting of information as to spiritual counselling."
Clergy and ministers are beginning to hold sensitive information on computers. There is a Church computer users' group and their fear is that such information could be disclosed to the police, to Customs officials or others by, say, a parish secretary if he or she has access to the computer data; and that could be given without the knowledge or consent of the priest or pastor who had put that information on record. This I think shows that there are a great many people invoved in this work of what is called in the amendment "spiritual counselling". I therefore hope very much that the Minister will feel able to accept the noble Baroness's amendment, because I think it would be of help to a great many concerned.
Baroness Vickers: My Lords, I should also like to support this amendment. My reason is rather a different one. I am connected with a hospital in which some people have been staying for up to 30 years. Now it is found, with modern drugs and so on. that they can leave hospital and live in the community. We have over 300 people in the community at the present time and there may be even more, as far as I know. But it is essential that they should be given support, and of course the social workers are the people who can give them the best support. The other thing that is essential is that a lot of them have to take drugs at certain times on certain days. That must be safeguarded if we want to keep them in the community. So I do feel very strongly that we must have the help and support that can be given only by the social workers in this connection and therefore I wish to support the amendment.
Lord Mishcon: My Lords, the last thing in the world I want to do on a Friday morning is to repeat in other words the points so well made by other speakers. I therefore do not intend to do that; but I want to say from these Benches that we certainly support the principle and the spirit behind this amendment.
I want to try practically, only for a minute or two, to see whether there is any alternative that we ought to put before the Minister before he replies, because I am sure that the spirit of the amendment is one which coincides with his own views. Therefore, if there is any technical difficulty or any other difficulty in the way of accepting this amendment. I would, in line with the British Associaton of Social Workers (who are very worried about the position), like to put forward these
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proposals to the Minister before he replies. At least, if for any reason the Government cannot accept the amendment of the noble Baroness (although I hope they will) the suggestion is that the Government should state unequivocally that where there is any degree of overlap in respect of data relating to physical or mental health and to religious or other beliefs, with data that should not be regarded as falling under those headings. then the higher standards of protection to be offered under those headings should be in the proposed regulations.
Similarly, where a social services computer file includes any information regarding personal welfare or personal functioning which might be regarded as having a bearing on health, those data should also be protected. This would apply of course to psychological tests adminstered by qualified psychologists which rely on data supplied by the data subject. Quite obviously it would be the preference, certainly of that association and those who were like-minded, that the Government should acknowledge that they already have the power under Clause 2(4) of this Bill to modify the interpretation of the data protection principles, and that they would do so on the lines that I have indicated and which are embodied in the noble Baroness's amendment.
Lord Elton: My Lords, at the end of the last piece of business the noble Lord, Lord Mishcon, said how difficult it was to find different words with which to thank my noble friend Lady Faithfull on different occasions. I must say that my chief difficulty, which I find myself reminded of on each occasion when she intervenes, is the fact that she makes me feel there should be some sort of driving mirror attached to the Dispatch Box—she addresses all her most difficult points to the nape of my neck!
I think that I can be of help in reassuring your Lordships, without necessarily following any of the paths which your Lordships have suggested the Government might follow. My noble friend's Motion is intended to extend the scope of the amendment which I have tabled so as to enable restrictions to be placed on the disclosure of social work data. I well understand the reasoning which has led her to table this Motion and the concern which has prompted it, and I think that has been made more clear in the course of this debate. That I appreciate, but I must make it clear to start with that the result which she desires cannot be achieved through an amendment to Commons Amendment No. 6 in any form.
The Bill recognises that there are certain categories of specially sensitive data which may require additional safeguards. These categories, which are the same as those recognised by the Council of Europe convention, are set out in subsection (3) of Clause 2 and are data relating to the racial origin of the data subject. his political opinions or religious beliefs, his physical or mental health or sexual life, or his criminal convictions. Social work data are not included in this list and cannot, therefore, be made the subject of an order under Clause 2. My noble friend's amendment does not, and cannot, succeed in bringing social work data within the scope of the order-making power, since that power resides in subsection (3) and not in the new subsection (4A) which is inserted by the Commons amendment.

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At any other stage in our proceedings we would, of course, regard this as a purely technical argument and could nevertheless proceed with the debate on the merits, in the knowledge that any technical defects could be remedied later. That option is not open to us now. Our terms of reference are limited, and I could not therefore undertake to go away and produce something which would meet my noble friend's concerns or those of other noble Lords, as has been suggested, because although it is open to us to suggest different amendments to this amendment it is not open to us to amend another part of the Bill. That makes what follows in my speech the more important.
I must add, however, that while I understand the concern which underlies the Motion I believe that there is a difference between health data and social work data which justifies their different treatment. We are talking here about the disclosure of data by the data user to third parties. Where health data are concerned within the National Health Service, the data are technically held by the health authority rather than by the health professional. This has always been the case, and there are already existing arrangements which regulate the use and disclosure of such data by the health authority. It is these arrangements which may be given statutory backing by directions under the National Health Service Act.
Outside the National Health Service, health data may be held not only by individual professionals but by a wide range of other people for perfectly legitimate reasons; for example, by employers, insurance companies, pension funds, holiday and travel firms and many others. Clearly these people have good reasons for needing to hold health data, but may not be professionally qualified to decide whether such data should be disclosed to anyone else.
The same is not true of social work data. I accept that the local authority rather than the individual social worker holds social work data in the same way as the health authority holds health data. But arrangements for the use and disclosure of such data by the local authority are a matter for internal agreement. Indeed, I understand that the local authority associations are drawing up codes of practice for different categories of data, and I am sure that they would wish to discuss the handling of social work data with those concerned, including those who have addressed themselves to my noble friend's interest. But all that is an internal matter. Looking outside the local authority, there are simply not the same range of people who hold social work data. There is therefore not the same need for restrictions on disclosure of such data.
May I now come to what I think, with respect, may be a misconception which I readily understand and frequently find myself influenced by when I return to this Bill after a period away from it, but which I think may underlie the concern of noble Lords. We must not be misled into thinking of health data as the data which doctors hold, and social work data as the data held by social workers, as if the two were mutually exclusive. My noble friend has ably shown how they are interwoven. The Bill operates not on the basis of files of data, but on individual items of data.
Just because a file has my name on it, it does not mean that all the data contained in it are personal data
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to which I am entitled to have access. One has to look at the information contained in the file and identify that which is personal to me, including opinions and excluding intentions. Similarly, just because my name appears on the outside of a social work file, it does not mean that all the data in that file are exclusively social work data.
The file may contain information that my doctor says I have been under great pressure, having handled far too many Bills lately, and that this has affected my health and explains my eccentric behaviour. I cannot think why that should be in my briefl That is information obtained during the course of social work and is therefore social work data; but it is also information about my physical or mental health and, accordingly, is also health data. The definition of "health professional" will be a matter for the order itself. In determining the contents of the order we will, of course, bear in mind what your Lordships have said.
But to return to the health data, which is what I was talking about, the Bill allows the order to cover data as to one individual's physical or mental health. This may need further specification in the order itself, but would clearly seem to go sufficiently wide to allow us to cover in the order all that is required in the health field. I hope that your Lordships begin to see how the protection of the Bill extends to these items of health information, although they are held by social workers.
The data do not stop being health data just because they are contained in a social work file, and they will be subject to the same restrictions on disclosure as may be imposed on health data generally by an order under Clause 2. There is no danger, therefore, of health professionals refusing to pass on health data to social workers because of the risk of further disclosures—
Lord Mishcon: My Lords, it looks as though the noble Lord is now going on to a separate point. Before he leaves this one, could he give the House an undertaking, which is the one that I really asked for, that if there is an overlap such as he suggested the higher principles of protection will apply in regard to that overlap in any regulations that are made?
Lord Elton: My Lords, I think that the answer may be qualified and therefore will not come as readily to my lips as the noble Lord or I would wish. My noble friend gave specific examples of health data. I understand that no such qualification is required, but I want to be quite sure of that so I am going on with what I am saying now. The noble Lord seeks to draw into the record that which is visible but not audible, but that is not the function of the record. It is my privilege, however, to be able to convert the visible into the audible, and I am happy to give the undertaking which the noble Lord sought.
Lord Mishcon: And I, my Lords, in turn, have the pleasure of thanking the noble Lord for it.
Lord Elton: My Lords, I wonder, therefore, whether I should continue much further, because I think this will assist my noble friend. One of her concerns was where an adoption was being considered. I think that I can put her mind at rest in that connection. Wherever health data are held in these circumstances, the order

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that can be made under Clause 2 can apply to those health data. As I said a moment ago, health data remain health data whether held by a doctor, a social worker or anyone else. My noble friend will no doubt tell me in a moment whether she has followed what I have said and whether it has sufficed to reassure her.
12.30 p.m.
Baroness Faithfull: My Lords, I am sorry, but I am afraid that I am not reassured, because I do not think that it is fully appreciated how a social service department works. You cannot separate medical data from social work data when each is dependent on the other. Unless I do not understand computers, I do not see how, when you are making a recommendation that a child should be adopted or not adopted, because the medical record says that the child will not live for very long and therefore the case should not be recommended for adoption, you can separate out that tiny, middle sentence upon which the social work decision is going to be taken by the adoption committee.
Lord Elton: My Lords, I can reassure my noble friend that this is precisely what I mean. Perhaps your Lordships recall the endless discussions on the definition of "data", the central feature of which was the very, very small units into which they are broken down. Any units which are units specifically of medical information, as defined, are covered by the provisions of the Bill which relate to that kind of data, regardless of whether or not they are intermingled with other data. My noble friend will rightly say that it may be an awful job to unscramble the data and decide what one can and cannot legitimately say, but this is something which one does in one's own head with every piece of confidential information that one receives. I am sure that on many occasions my noble friend, who has discussed correspondence with me, has not revealed to me the whole of it, or the whole of any one paragraph. I also have to learn to respect the confidentiality of separate pieces of information, some of which are confidential and some of which are not, which together comprise an item on the file. The only way I can reassure my noble friend is to say that with a computer it is much easier to separate these bits out than it is to do it manually.
Lord Mottistone: My Lords, I still do not understand why my noble friend's amendment is not acceptable.
Lord Elton: My Lords, I thought that I had already read that out. My noble friend's amendment relates to a function which is not covered by the Commons amendment. The procedures of Parliament steadily narrow the area upon which we can have an influence. If they did not do that, the vanishing point would never be reached and we should still be discussing the Criminal Evidence Bill 1982. Because the area of my noble friend's concern lies outside the amendment, it is not possible for any amendment to this amendment to achieve what she wants. That is why I have tried to take considerable care in giving what I hope will be, at least in print, a lucid explanation of the way in which what my noble friend wants is, in fact, achieved by the
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Bill. I understand how my noble friend has lost sight of that, because so had I until I started to re-read my brief.
Lord Mishcon: My Lords, the noble Lord the Minister has helpfully given an undertaking. Personally I felt that there was some technical difficulty, not because of any wisdom of mine or any knowledge of the legislation, but because rumour had reached me that there was a technical difficulty. Therefore I thought the practical way to deal with it was to see that advantage was obtained from the noble Baroness's contribution to this debate, and her amendment, by getting the undertaking as to overlap and the higher protection that will be given under any regulations which are going to be made. The noble Lord the Minister has very courteously conceded that point and has said that such an undertaking can be given and that the regulations will be so worded.
Baroness Faithfull: My Lords, I recognise that there is a technical difficulty. The problem is that it has arisen towards the end of the Bill. If it had arisen a little earlier, things might have been easier. Up to the moment we have been talking about the medical data which must be safeguarded, but there are other data which have to be safeguarded by social workers. As I said in my speech, the information on the computer of the social services department includes, besides sensitive medical information, information which is also very sensitive from the point of view of personal relationships, from the point of view of the courts, and from the point of view of confidentiality as between clients. Am Ito understand from the Minister that that information is safeguarded and, if that is so, how is it safeguarded?
Lord Elton: My Lords, the difficulty is that we cannot have again all the debates which we had on this subject when the Bill was orginally in this House. I am tempted to refer my noble friend to the debates that we had at that stage and to remind her that the whole purpose of the Data Protection Bill is to provide safeguards for the data subject. That is what it is here for. It is not exposing data subjects to greater risk of injury from misinformation, or fright at true information. It is intended to ensure that the evils which might spring from a misuse of the computer and computerised records shall be, as far as is possible in law, minimised, avoided, muffled or stopped. At what point in that scale of effects the information which my noble friend wishes to introduce by means of this amendment strikes I could not precisely say, but the fact is that all personal data is protected by the Bill. That is its function. If my noble friend had wanted to change the function of the Bill, may I say, with the greatest respect and courtesy and without wishing to give any offence whatsoever, that she should have said so when the Bill was in this House. But that is no longer possible.
Baroness Faithfull: My Lords, I fully accept the delightful chiding of my noble friend the Minister. This should have been said at an earlier stage. Nevertheless, it was not possible for me to take part in the Data Protection Bill when it was before your Lordships' House. But that is no excuse. I have to say

1169
frankly that I am not entirely happy about the present position. I should very much regret it if the relationship between the social services and the medical profession were jeopardised. I should regret it bitterly if the relationship between social workers and their clients were jeopardised, because the clients are the most vulnerable in our society.
I appreciate that this is a faulty amendment. All I would say is that I hope that my noble friend the Minister and the civil servants in both the Department of Health and Social Security and the Home Office will appreciate very deeply what the noble Lord, Lord Mishcon, has said and will appreciate, too, the very real difficulties that the departments run into. With that, I beg leave to withdraw the amendment.
Lord Elton: My Lords, before my noble friend does so, may I point out that she inferred that the amendment failed because of a technicality. I hope I made it clear that no amendment could achieve what she wants. It is not a question of my noble friend having wrongly drafted the amendment. It is simply that a vacancy does not exist for an amendment to do what she wants it to do. That is the hard fact of the matter. Secondly, we are deeply sensitive to the delicate and important nature of the relationships to which my noble friend has referred. I should not wish anything I have said to obscure that fact. My last point is that it really is the case that a social worker who wants to protect, or keep confidential, data, will find it easier to do so effectively after the Bill is on the statute book than was the case previously.
Amendment to the Commons amendment, by leave, withdrawn.
On Question, Motion agreed to.

COMMONS AMENDMENT
7 Clause 3, page 3, line 34, leave out from ("shall") to ("and") in line 37 and insert ("be—
(a) persons to represent the interests of data users;").
Lord Elton: My Lords, I beg to move that the House doth agree with the Commons in their Amendment No. 7, which affects Clause3. I think it will be for the convenience of the House if I speak also to Amendments Nos. 49 and 50 which strike at Schedule 3.

COMMONS AMENDMENTS
49 Schedule 3, page 37, line 35, leave out from second ("of') to end of line 43 and insert—

("(a) the chairman or a deputy chairman (who shall preside); and

(b) an equal number of the members appointed respectively in accordance with paragraphs (a) and (b) of section 3(5) of this Act.").

50 page 38, line 4, leave out sub-paragraphs (3) and (4).
The purpose of these amendments is to alter the composition of the data protection tribunal—and how well I remember our discussions on the composition of the tribunal—and to ensure that on a duly constituted tribunal there will be equal numbers of persons appointed to represent the interests of data subjects and of data users. This should provide for a more evenly balanced tribunal than the Bill originally allowed.
As noble Lords will recall, the Bill originally provided for at least half the members of the tribunal to be computer experts and for at least one member to represent the interests of data subjects. This was seen by many as favouring data users at the expense of data subjects, since computer experts were seen as implicitly representing data users, while others argued that data users would be completely unrepresented, since there was no specific provision to ensure that their interests were adequately catered for. The new formulation makes it clear that data users and data subjects are to be represented in equal numbers. No provision is now made for computer experts, but any necessary technical advice can be obtained by the tribunal by calling expert witnesses. I beg to move.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
Lord Mishcon: My Lords, I will resist the temptation to refer to the various copies of the Official Report covering the discussions on this matter in the course of the Bill. I am pleased to see this amendment.
Lord Elton: My Lords, the noble Lord might almost have said, "I told you so".
On Question, Motion agreed to.
12.40 p.m.

COMMONS AMENDMENTS
8 Clause 5, page 5, line 11, leave out ("or use any such data") and insert ("any such date, or use any such data held by him.")
9 Clause 5, page 5,line 14, after ("data,") insert ("to be held by him")
10 Clause 5, page 5, line 16, after ("data") insert ("held by him")
11 Clause 5, page 5, line 18, after ("data") insert ("held by him")
12 Clause 5, page 5, line 21, leave out subsection (3) and insert—
("(3) A servant or agent of a person to whom subsection (2) above applies shall, as respects personal data held by that person, be subject to the same restrictions on the use, disclosure or transfer of the data as those to which that person is subject under paragraphs (b), (d) and (e) of that subsection and, as respects personal data to be held by that person, to the same restrictions as those to which he is subject under paragraph (c) of that subsection.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 8 to 12 en bloc. The first four of these amendments, which all affect Clause 5, deal with the offences that may be committed under Clause 5 by registered data users and ensure that the scope of the offences is limited to personal data which are held, in the very special sense used by the Bill, by registered persons in question.
Amendment No. 12 modifies the application of the offences to the servants or agents of registered persons. It ensures that the use as well as the disclosure, transfer, and so on, of personal data by such a servant or agent in a manner not specified in the relevant register entry will be an offence. These five amendments merely iron out anomalies in the formulation of the Clause 5 offences, and I hope that your Lordships will accept them. I beg to move.
Moved, That this House doth agree with the Commons in the said amendments.—(Lord Elton.)
On Question, Motion agreed to.

COMMONS AMENDMENT
13 Clause 10, page 9, line 38, leave out from ("user") to end of line 40 and insert("—

(a) to rectify or erase the data and any other data held by him and containing an expression of opinion which appears to the Registrar to be based on the inaccurate data; or

(b) in the case of such data as are mentioned in subsection (2) of section 22 below, either to take the steps mentioned in paragraph (a) above or to take such steps as are specified in the notice for securing compliance with the requirements specified in that subsection and, if the Registrar thinks fit, for supplementing the data with such statement of the true facts relating to the matters dealt with by the data as the Registrar may approve.").

Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 13. This amendment strikes Clause 10, and it may be to your Lordships' convenience if I speak also to Amendments Nos. 20 and 21, to Clause 24.

COMMONS AMENDMENTS
20 Clause 24, page 19, line 34, leave out ("Subject to subsection (2) below,").
21 Page 20, line 1, leave out subsection (2) and insert—
("(2) Subsection (1) above applies whether or not the data accurately record information received or obtained by the data user from the data subject or a third party but where the data accurately record such information, then—

(a) if the requirements mentioned in section 22(2) above have been complied with, the court may, instead of making an order under subsection (1) above, make an order requiring the data to be supplemented by such statement of the true facts relating to the matters dealt with by the data as the court may approve; and

(b) if all or any of those requirements have not been complied with, the court may, instead of making an order under that subsection, make such order as it thinks fit for securing compliance with those requirements with or without a further order requiring the data to be suplemented by such a statement as is mentioned in paragraph (a) above.").

In moving these amendments, may I draw your Lordships' attention to a small misprint in paragraph (a) of Amendment No. 13 as set out in the list of amendments? In the first line of that paragraph the word "date" should of course read "data".
The important change in this group is made by Amendment No. 21. It deals with marked data; in other words, and as I am sure your Lordships will remember, data which have been obtained from a third party and carry an indication that they have been so obtained—and, if their accuracy is disputed by the data subject, carry a further indication to that effect. Marked data are immune from civil action as regards their accuracy. Compensation cannot be awarded for damage caused by their inaccuracy, and the court cannot order their rectification and erasure.
I believe that your Lordships accepted the need to provide protection from liability to pay compensation in respect of inaccurate "received" data which have been properly marked, but the noble Lord, Lord Mishcon, did question at Report stage whether it is right to prevent a court from ordering that such data be rectified or erased. He will be pleased to know that
1172
on reflection the Government agreed with him that the courts should be able to interfere even with "marked" data if they were inaccurate. Amendment No. 21 allows this to happen. The two other amendments are consequential. Amendment No. 13 merely ensures that the registrar's powers are unaffected, while Amendment No. 20 makes a drafting change to Clause 24. I beg to move.
Moved, That the House doth agree with the Commons in the said amendment.—(Lord Elton.)
Lord Mishcon: My Lords, I am most grateful to the noble Lord the Minister for his very courteous reference to the contribution I made in regard to this on behalf of my noble friends. I am delighted to see this amendment.
On Question, Motion agreed to.

COMMONS AMENDMENTS
14 Clause 19, page 16, line 15, leave out. ("or, as respects Northern Ireland, £1000.")
15 line 20, leave out ("or, as respects Northern Ireland, £1,000.")
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment Nos. 14 and 15. As a result of the Fines and Penalties (Northern Ireland) Order 1984, there is no need for a separate statement of maximum penalties for Northern Ireland any longer. The inflation-proofing system already in force in the rest of the country will apply there, too. The amendments simply remove the superflous words. I beg to move.
Moved, That this House doth agree wth the Commons in the said amendments.—(Lord Elton.)
On Question, Motion agreed to.

COMMONS AMENDMENT
16 Clause 21, page 18, line 15, leave out from ("deletion") to end of line 17 and insert ("that would have been made regardless of the receipt of the request.")
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 16, to Clause 21. Clause 21 provides that a data user who receives a request for access must supply the relevant information as it stood on the date the request was received; but it recognises that changes are constantly being made to personal data, and it would be wrong if those changes had to be suspended between the time the request was received and the time it was complied with. We have tried to find a provision that allows processing to continue but does not allow any data to be "doctored" or suppressed as a result of the request. When the Bill left this House Clause 21(7) provided that the information supplied in response to a request could reflect changes in the data so long as those changes were the results of instructions programmed before the request was received and were made to keep the data up to date.
But upon reflection it occurred to us that this arrangement might be unduly restrictive. New programs for updating data may be introduced. As Clause 21(7) stood, the user would have to clear outstanding requests for access before implementing the new program. Moreover, other operations are

1173
routinely performed on the data. Unwanted information may be weeded out and completely new information added. If the information supplied to the data subject could not reflect such changes, the data user would be forced not to make them or to keep a manual record of any data he had deleted. This is hardly satisfactory for either him or the data subject, who would normally want the information obtained to be as current as possible.
Amendment No. 16 will allow the data user to supply the information as it stands when the request is complied with provided that any changes made since the request was received are changes which would have been made irrespective of the receipt of the request, so that the record cannot be changed as a result of a request. I beg to move.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
Lord Mishcon: My Lords, I wonder whether the noble Lord the Minister can help me. Is this a convenient moment to deal with the question of raw marks on examination papers? He has dealt with Clause No. 21(7); but if the Minister feels that this is not a convenient moment and that another moment may be more convenient for him, I will sit down. I think he knows the point I am going to make.
Lord Elton: My Lords, I do know the point the noble Lord has in mind, and I believe that I shall be answering it by means of an amendment. That perhaps, will be the appropriate moment. If we are racing towards the buffers and I have not mentioned it, then please let the noble Lord remind me. My recollecton is that we shall reach that aspect shortly.
Lord Mishcon: My Lords, I am most grateful.
On Queston, Motion agreed to.

COMMONS AMENDMENTS
17 Clause 22, page 18, line 34, leave out ("for that damage from the data user") and insert ("from the data user for that damage and for any distress which the individual has suffered by reason of the inaccuracy.").
18 Clause 23, page 19, line 24, leave out ("for that damage").
19 Clause 23, page 19, line 25, at end insert ("for that damage and for any distress which the individual has suffered by reason of the loss, destruction, disclosure or access.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 17 to 19 en bloc. Amendment No. 17 strikes in Clause 22, and Amendments Nos. 18 and 19 in Clause 23. The amendments provide that where a subject suffers damage as a result of inaccurate data or of a breach or failure in a user's security arrangements he is entitled to compensation not only for the damage but also for any distress which he suffers. It was argued both in this House, in the context of the previous Bill, and in another place that where inaccuracy results in distress to the data subject he or she should be entitled to compensation under Clauses 22 or 23 just as if damage had been suffered.
My noble and learned friend the Lord Chancellor replied to that argument by pointing out that to found a civil action on distress alone could lead to speculative litigation; anyone who had been mildy annoyed by a
1174
minor slip in his gas bill might be tempted to chance his arm in the courts. But we are persuaded that where the plaintiff can point to some material damage that he has suffered in circumstances entitling him to compensation under Clauses 22 or 23, it is right that the courts, in fixing the amount of compensation to be awarded, should take into account any distress which he may have suffered. These amendments make the changes necessary to achieve this, and go as far as we consider sensible in meeting the concern that has been expressed. I beg to move.
Moved, That this House doth agree with the Commons in the said amendments.—(Lord Elton.)
Lord Mishcon: My Lords, I am again tempted to refer to the Official Report of the arguments and submissions on this matter that we made in the course of our deliberations on this Bill. I will resist the temptation to do so, and will merely say again that I am pleased to see these amendments.
On Question, Motion agreed to.

COMMONS AMENDMENTS
20 [Printed above.]
21
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 20 and 21 en bloc. I spoke to these amendments with Amendment No. 13.
Moved, That this House doth agree with the Commons in the said amendments.—(Lord Elton.)
On Question, Motion agreed to.

COMMONS AMENDMENT
22 Page 20, line 24, at end insert ("; but, in the case of data in respect of which services were being provided by a person carrying on a computer bureau, the court shall not make such an order unless such steps as are reasonably practicable have been taken for notifying the person for whom those services were provided and giving him an opportunity to be heard.").
Lord Elton: My Lords, I beg to move that the House doth agree with the Commons in their Amendment No. 22 to Clause 24.
As your Lordships know, computer bureaux process or provide processing facilities for personal data which are held by others. The main obligation which the Bill imposes on bureaux, therefore, is to take adequate security measures and when damage to a subject occurs as a result of a bureau's failure to do so a court may order it to pay compensation and, more importantly in the present context, to erase the personal data in question under Clause 24(3).
Clearly the data user, whose data are being processed by the bureaux, has a direct interest in the question whether the data should be erased. It would be wrong if the court could order the erasure of the user's data without steps being taken to bring this prospect to the user's attention and the user being given the opportunity to be heard in that connection.
The amendment, therefore, recognises this by requiring the court to take measures for the purpose of enabling representations to be received from the data user before making an order under Clause 24(3). I hope noble Lords will agree that this is a sensible precaution. I beg to move.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
On Question, Motion agreed to.

COMMONS AMENDMENT
23 Clause 28, page 22, line 9, at end insert—
(" (IA) Personal data which—

(a) are held for the purpose of discharging statutory functions; and

(b) consist of information obtained for such a purpose from a person who had it in his possession for any of the purposes mentioned in subsection (1) above,

are exempt from the subject access provisions to the same extent as personal data held for any of the purposes mentioned in that subsection.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 23 to Clause 28.
This amendment bears on perhaps the most contentious clause in the Bill. Nonetheless, I hope that the slight change it makes is not one which noble Lords will find difficult to accept. Clause 28(1), of course, says that personal data held for any of the specified purposes are exempt from subject access if subject access would be likely to prejudice any of those purposes. Agencies which hold the data for those purposes. however. may pass the information to other bodies who need it for different purposes. For instance, the police may have to pass sensitive information to the Police Complaints Board; or the Inland Revenue may be required to disclose data exempt from subject access to the ombudsman. Neither the ombudsman nor the Police Complaints Board necessarily hold the data for a purpose stated in Clause 28(1) and they might, therefore, be unable to refuse a request for access on those grounds. Yet the infomation is no less sensitive for being in their hands.
Therefore, Amendment No. 23 ensures that where a person obtains information exempt from subject access under Clause 28(1) for the purpose of discharging his statutory functions, the data continue to be exempt to the same extent as they were before the closure took place. The provision is deliberately limited to persons carrying out functions conferred by Parliament in order not to give rise to fears that the scope of Clause 28(1) will be unduly extended thereby.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
On Question, Motion agreed to.

COMMONS AMENDMENT
24 Clause 29, page 22 line 44, leave out ("those provisions (or") and insert ("the application to the data of those provisions (or of).
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 24 to Clause 29. It is a purely drafting amendment.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
On Question, Motion agreed to.

COMMONS AMENDMENT
25 After Clause 29, insert the following new clause:
("Regulation of financial services etc.
.—(1) Personal data held for the purpose of discharging statutory functions to which this section applies are exempt from the subject access provisions in any case in which the application of those provisions to the data would be likely to prejudice the proper discharge of those functions.
(2) This section applies to any functions designated for the purposes of this section by an order made by the Secretary of State, being functions conferred by or under any enactment appearing to him to be designed for protecting members of the public against financial loss due to dishonesty, incompetence or malpractice by persons concerned in the provision of banking, insurance, investment or other financial services or in the management of companies or to the conduct of discharged or undischarged bankrupts.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 25 to Clause 29. At the same time it may be helpful if I speak to Amendment No. 45 to Clause 38.

COMMONS AMENDMENT
45 Clause 38, page 28, line 42, after ("29") insert (", (Regulation of financial services etc.)").
Of the two amendments, Amendment No. 25 is, of course, the substantive one. It introduces a new order-making power for the Secretary fo State to exempt certain data from the subject access provisions. The data in question are data held for the purpose of discharging statutory functions which are designed for protecting members of the public against financial loss due to dishonesty, incompetence or malpractice by persons concerned in the provision of banking, insurance, investment or other financial services or in the management of companies, or against financial loss due to the conduct of bankrupts. The data may only be exempt from subject access, however, if granting access would be likely to prejudice the proper discharge of the statutory functions. The exemption is, therefore, rather similar to the one in Clause 28(1) and it is designed to ensure that bodies such as the Bank of England or the Registrar of Friendly Societies or the Director General of Fair Trading may carry out the various functions assigned to them for the protection of the public from financial loss without fear that their ability to do so will be hampered by the application of the subject access provisions.
Of course. Clause 28(1) may be relevant in some cases, but there may be others where what is at issue is a person's incompetence or dishonesty which may fall short of being a criminal offence. In such a case access by the subject to the data held about him may enable him to cover his tracks or in some other way to frustrate the investigation. There is also a danger that, if access were granted to the subject, valuable sources of information might dry up. Such disclosure might enable a subject to guess who the source was. The financial regulatory agencies with which this amendment is concerned rely heavily upon information from confidential sources and it is therefore important to ensure that the supply of information is not unnecessarily impeded.
It is worth pointing out. however, that in almost all cases where information about a subject is acted upon in order to take a decision which affects him the subject has a right of appeal against the decision and

1177
would at that time be told the substance of the information held about him. This amendment is, therefore, designed merely to prevent premature access before a case has been properly established and at a time when access might have adverse consequences for the way in which the regulatory agencies discharge their functions. I believe it provides a necessary protection for the public at large which justifies the infringement which it represents of the subject's right of access.
Amendment No. 45 is merely consequential.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
26 Clause 31, page 23, line 17, leave out from ("user") to end of line 25 and insert ("only for one or more of the following purposes—

(a) calculating amounts payable by way of remuneration or pensions in respect of service in any employment or office or making payments of, or of sums deducted from, such remuneration or pensions; or

(b) keeping accounts relating to any business or other activity carried on by the data user or keeping records of purchases, sales or other transactions for the purpose of ensuring that the requisite payments are made by or to him in respect of those transactions or for the purpose of making financial or management forecasts to assist him in the conduct of any such business or activity.")

27 Clause 31, page 23, line 30, leave out ("that for which they are held or") and insert ("the purpose or purposes for which they are held and are not")
28 Clause 31, page 23, line 31, leave out from ("(3)") to ("for") in line 36 and insert ("and (4) below; but the exemption shall not be lost by any use or disclosure in breach of that condition if the data user shows that he had taken such care to prevent it as in all the circumstances was reasonably required.
(3) Data held only for one or more of the purposes mentioned in subsection (1)(a) above may be disclosed—

(a) to any person, other than the data user, by whom the remuneration or pensions in question are payable;

(b) for the purpose of obtaining actuarial advice;

(c) for the purpose of giving information as to the persons in any employment or office for use in medical research into the health of, or injuries suffered by, persons engaged in particular occupations or working in particular places or areas;

(d) if the data subject (or a person acting on his behalf) has requested or consented to the disclosure of the data either generally or in the circumstances in which the disclosure in question is made; or

(e) if the person making the disclosure has reasonable grounds for believing that the disclosure falls within paragraph (d) above.

(4) Data held for any of the purposes mentioned in subsection (1) above may be disclosed—
29 (a") Clause 31, page 23, line 39, at end insert (";or")
30 Clause 31, page 23, line 40, leave out from beginning to first ("in") in line I on page 24 and insert ("(b)").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 26 to 30, en bloc, which all touch on Clause 31.
Although these amendments appear to amount almost to a complete redrafting of Clause 31 I think I can reassure the House that they raise no fundamental issues. Your Lordships will recall that Clause 31 provides an exemption, subject to certain conditions being met, for data held for payroll and accounting purposes. Amendment No. 26 makes some changes to what are, in effect, the definitions of payroll and
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accounting data. Subsection (1)(a) is amended not only to refer to data held for the purpose of making payments of remuneration and pensions but also for the purpose of making payments of deductions from remuneration and pensions—for example, PAYE deductions or trade union subscriptions. Subsection (1)(b) is also amended to cover data which are held for what has become known as "management accounting" purposes—that is, basically accounting data which are used to make financial or management forecasts.
Amendment No. 27 is designed simply to avoid ambiguity and to make it clear that data may be held for one or any combination of the purposes described in subsection (1) and still claim the benefit of the exemption, while Amendment No. 28 makes a number of changes. The first of these makes it clear that a data user does not lose the benefit of the exemption if data are used or disclosed in breach of the conditions attached to it if he can show that he had taken such care as was reasonably required to prevent the breach. That is a normal provision.
Second, the amendment allows payroll data to be disclosed for the purpose of obtaining actuarial advice. This amendment was prompted by various organisations who deal with pension funds and who quite legitimately need to disclose payroll data for this purpose. Without this amendment a user would have had to forgo the exemption in order properly to make his pension arrangements.
Third, the amendment allows payroll data to be disclosed for the purposes of medical research. Apparently researchers sometimes need payroll data in order to identify people working in particular occupations, or perhaps in particular areas, who might be prone to certain illnesses. Again, without this amendment, a user would not be able to claim the exemption and co-operate with medical researchers. We certainly do not want to hinder medical research and, since the data being disclosed will not themselves be sensitive health data but will probably be little more than names and addresses, it seems sensible to allow them to be disclosed without requiring the user to register.
Finally, the amendment allows data to be disclosed if the person making the disclosure has reasonable grounds for believing that disclosure is to the data subject or a person acting on his behalf, or if he has reasonable grounds for believing that the subject has requested or consented to the disclosure. If this amendment were not made, a user who disclosed data in good faith to a person he mistakenly believed to be the subject would lose the benefit of the exemption and find himself committing the absolute offence of Clause 5(1) of holding data without being registered.
Amendments Nos. 29 and 30 are consequential and drafting amendments. I believe that this rather formidable group of amendments will ensure that the exemptions in Clause 31 are wide enough to be of real value while not going so wide as to represent an unacceptable weakening of the data protection scheme. I commend them to your Lordships.
Moved, That this House doth agree with the Commons in the said amendments.—(Lord Elton.)
Lord Mishcon: My Lords, I think that the noble Lord the Minister knows there are bodies which feel that the exemptions in respect of payrolls and accounts have been substantially extended by this amendment. He may also know that the Trades Union Congress has made certain representations in this connection. However, I need not worry him any further in that regard because I am aware that their submissions are known to the Government. I do not think that I should have much success if I endeavoured at this stage to do anything about this amendment, but I thought it only proper to put that on record in view of the observations that the noble Lord made about the possible general acceptability of the amendment.
On Question, Motion agreed to.

COMMONS AMENDMENTS
31 Clause 32, page 24, line 9. after ("affairs") insert ("or held by him only for recreational purposes").
32 Clause 32, page 24, line 15, at end insert ("or information").
33 Clause 32, page 24, leave out line 17 and insert (", addresses or other particulars necessary for effecting the distribution,").
1.3 p.m.
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 31 to 33, which affect Clause 32. I should like to start by drawing your Lordships' attention to our second and, I think, final printer's error. In Amendment No. 32, the reference should be not to line 5 but to line 15. I gather that my noble friend Lord Mottistone had spotted it. These amendments represent a fairly minor qualification to the provisions in Clause 32 which provide exemptions from the operative provisions of the Bill for data held for domestic or other limited purposes. Noble Lords will recall the interesting debates that we had about the cricket loving schoolboy who was also a computer enthusiast and who kept the school team's batting averages on his computer. Much concern was expressed at the prospect of little Johnny having to register his data with the registrar. While I took the view at the time that this was unlikely, since Johnny would be holding the data for his own personal purposes and able therefore to claim exemption under Clause 32, on reflection, we thought it better to put the matter completely beyond doubt. Amendment No. 31 does this by inserting into Clause 32(1) a specific reference to data held for recreational purposes. This will give the noble Lord, Lord Mishcon another of his increasingly frequent opportunities to tell us that he is not saying "I told you so" but he would if he thought he should.
Amendments No. 32 and 33 amend subsection 2(b) of Clause 32, which relates to data consisting only of names and addresses held for the purpose of distributing articles to data subjects. They recognise that the age of electronic mailing is with us and that information as well as articles may be distributed to data subjects and may be sent to the electronic equivalent of an address. They are entirely straightforward and sensible amendments. I hope that your Lordships will agree with them. I beg to move.
Moved, That this House doth agree with the Commons in the said amendments.—(Lord Elton.)
Lord Mishcon: My Lords, I remember well my reference to cricket and the schoolboy. If only I had had an opportunity yesterday afternoon of making any reference to cricket, I should have done it with a smile on my face and happiness at England's score. By virtue of my duty to your Lordships House, I am unable to see or know whether that success has been maintained. I shall therefore sit down without further comment.
On Question, Motion agreed to.

COMMONS AMENDMENTS
34 Page 24, line 30, at end insert ("; but the first exemption shall not be lost by any use, and neither exemption shall be lost by any disclosure, in breach of that condition if the data user shows that he had taken such care to prevent it as in all the circumstances was reasonably required.").
35 Page 24, line 36, leave out from ("made;") to first ("in") in line 37 and insert—
("(b) if the person making the disclosure has reasonable grounds for believing that the disclosure falls within paragraph (a) above; or
(c)").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 34 and 35. At the same time I shall speak, if it is for the convenience of the House, to Amendments Nos. 40 and 41, which strike in Clause 33.

COMMONS AMENDMENTS
40 Clause 33, page 25, line 46, at end insert—
(": or
(d) the person making the disclosure has reasonable grounds for believing that the disclosure falls within any of the foregoing paragraphs of this subsection.").
41 Page 26, leave out lines 1 and 2 and insert—
("(5A) Section 4(3)(d) above does not apply to any disclosure falling within paragraph (a), (b) or (c) of subsection (5) above: and that subsection shall apply to the restriction on disclosure in section 32(6) above as it applies to the non-disclosure provisions.").
These amendments have one thing in common. They are designed to avoid making a user liable to prosecution for an absolute offence in cases where he has reasonable grounds for believing that what he is doing is permissible or where he has taken reasonable precautions to prevent something that is not permissible taking place. Amendment No. 34 provides that a user will not lose exemption under Clause 32(2) and will not therefore commit the absolute offence of holding data without being registered if he has taken reasonable care to prevent any use or disclosure of data in breach of conditions attached to the exemption. Similarly, with like effect, Amendment No. 35 provides that a user does not lose his exemption if he discloses data to a person he reasonably believes to be entitled to receive the data but who, in fact, is not so entitled. Amendment No. 40 makes the same sort of change to Clause 33(5), which concerns certain exemptions from the non-disclosure provisions, while Amendment No. 41 is purely consequential. I beg to move.
Moved, That this House doth agree with the Commons in the said amendments.—(Lord Elton.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
36 Page 25, line 14, leave out ("information—(a)") and insert ("information")
37 Page 25, line 1 7, leave out from ("enactment") to end of line 22 and insert ("if he considers that the prohibition or restriction ought to prevail over those provisions in the interests of the data subject or of any other individual.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 36 and 37. These amendments are designed to allay a concern expressed both in this House and in the other place about the possibility that Clause 33(2) might be used to exempt from the subject access provisions virtually all Government data on the grounds that their disclosure was prohibited by the Official Secrets Act. There was never any intention that the power in Clause 33 should be used in this way. In our view, to do so would probably have been ultra vires. Nevertheless, since there was clear concern about the matter, we thought it right to put the whole issue beyond doubt by amending subsection (2) to make clear that the Secretary of State may make an order only if disclosure of the data is already prohibited or restricted by law and if the Secretary of State believes that the prohibition or restriction should be maintained in the interests of the data subject or any other individual. This merely restates perhaps more clearly what has always been the Government's intention, but it gives me pleasure to be able to deliver this amendment to your Lordships because I recall the exceeding difficulty that I had in convincing your Lordships that the Government not only meant what they said but would do what they meant. I feel confident therefore that your Lordships will be glad to receive this amendment.
Moved, That this House doth agree with the Commons in the said amendments.—[Lord Elton.]
Lord Mishcon: My Lords, once again I resist the temptation to bore the House with an excerpt from a speech that I made at an earlier stage. I am delighted to see the amendment.
On Question, Motion agreed to.

COMMONS AMENDMENT
38 Pages 25, line 33, at end insert—
("(3A) Personal data are exempt from the subject access provisions if the data are kept only for the purpose of replacing other data in the event of the latter being lost, destroyed or impaired.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 38. I reflect that this House is not without its influence, as the responses of the noble Lord opposite make clear. This must be a matter of satisfaction. The purpose of the amendment is to avoid data users having to grant subject access to two sets of data which will be virtually identical. As a security precaution—when I say "security precaution" I do not mean things pertaining to secrecy and the protection of money, but against defects in the machine—almost all data users take copies of their data so that, if there is some kind of accident to the data or a failure in the machine that results in the corruption or, indeed, the loss of the data, all will not be irretrievably lost.
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They will have a copy of the data from which they will be able to reconstitute that which they have lost or which has become unuseable. The copy is referred to as a back-up tape or disc. The back-up data may be very slightly out of date since they will be a copy of the data as they stood at a fixed point in time. How much out of date they are likely to be will depend upon the nature of the operation for which they are used. Some data may be updated and copies taken daily while other data may be updated and used less frequently, perhaps weekly or even monthly.
The important point, however, is that the back-up data will never be used without first having been brought up to date by means of a separate log which users maintain and which records the transactions which have taken place since the copy was taken. There is little point, therefore, in giving the subject access to both the data in current use and the back-up data, particularly since the latter may well be kept in a form which does not lend itself to easy access.
This amendment therefore exempts for the subject access provisions data which are kept only for the purpose of replacing other data in the event of the latter being lost, destroyed or impaired. It removes what would otherwise have been an unnecessary and troublesome burden. I beg to move.
Moved, That this House doth agree with the Commons in the said amendment—(Lord Elton.)
Lord Mottistone: I welcome this amendment. I am only sorry that we did not think of it when the Bill passed through our House. It is a very practical addition to the Bill.
On Question, Motion agreed to.

COMMONS AMENDMENT
39 Page 25, line 35, leave out from ("is") to end of line 36, and insert (" —

(a) required by or under any enactment, by any rule of law or by the order of a court; or

(b) made for the purpose of obtaining legal advice or for the purposes of, or in the course of legal proceedings in which the person making the disclosure is a party or a witness.").

Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 39 to Clause 33.
This amendment does not raise any major new issues of policy. It is a tidying up amendment. As originally cast, Clause 33(4) exempted personal data from the non-disclosure provisions in any case where the disclosure was required by or under any enactment or by the order of a court. It was put to us, however, that there might be rules of law which also required the disclosures of data: trust law, for example, may in certain circumstances require trustees to disclose information. Clearly if there is a legal obligation to disclose data, whether that obligation arises at common law or under statute, a user should be able to meet the obligation without breaching the nondisclosure provisions of this Bill and this amendment ensures that he will be able to do so.
It also recognises that a user may sometimes need to disclose personal data for the purpose of obtaining legal advice or, more generally, for the purposes of

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legal proceedings. Of course, a registered user could do this without breaching the non-disclosure provisions if he included his legal adviser or courts of law as potential recipients of his data, but a user who is claiming the benefit of an exemption such as that in Clause 31, for payroll and accounting data does not have this option open to him and would have to forgo his exemption if he wanted, for example, to use some of his accounting data in order to bring an action against a debtor. The amendment avoids this by ensuring that the disclosure of data in such circumstances does not breach the non-disclosure provisions. I beg to move.
Moved, That this House doth agree with the Commons in the said amendment—(Lord Elton.)
Lord Mishcon: If I may say so in another capacity, the legal profession are very pleased with this amendment.
On Question, Motion agreed to.

COMMONS AMENDMENTS
40 Page 24, line 46, at end insert—
("; or
(d) the person making the disclosure has reasonable grounds for believing that the disclosure falls within any of the foregoing paragraphs of this subsection.").
41 Page 26, leave out lines 1 and 2 and insert—
("(5A) Section 4(3)(d) above does not apply to any disclosure falling within paragraph (a), (b) or (c) of subsection (5) above; and that subsection shall apply to the restriction on disclosure in section 32(6) above as it applies to the non-disclosure provisions.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 40 and 41 to Clause 33.
Moved, That this House doth agree with the Commons in the said amendments.
On Question, Motion agreed to.

COMMONS AMENDMENT
42 After Clause 33, insert the following new clause:
("Examination marks.
(1) Section 21 above shall have effect subject to the provisions of this section in the case of personal data consisting of marks or other information held by a data user—

(a) for the purpose of determining the results of an academic, professional or other examination or of enabling the results of any such examination to be determined; or

(b) in consequence of the determination of any such results.

(2) Where the period mentioned in subsection (6) of section 21 begins before the results of the examination are announced that period shall be extended until—

(a) the end of five months from the beginning of that period; or

(b) the end of forty days after the date of the announcement,

whichever is the earlier.
(3) Where by virtue of subsection (2) above a request is complied with more than forty days after the beginning of the period mentioned in subsection (6) of section 21, the information to be supplied pursuant to the request shall be supplied both by reference to the data in question at the time when the request is received and (if different) by reference to the data as from time to time held in the period beginning when the request is received and ending when it is complied with.
(4) For the purposes of this section the results of an examination shall be treated as announced when they are first published or (if not published) when they are first made available or communicated to the candidate in question.
(5) In this section "examination" includes any process for determining the knowledge, intelligence, skill or ability of a candidate by reference to his performance in any test, work or other activity.").
Lord Elton: My Lords, I beg to move that the House doth agree with the Commons in their Amendment No. 42 after Clause 33. This amendment allows data users who hold examination data an extended period with which to comply with the request for access to the data. Where a request for access is received before the results of the examination have been announced, the data user may delay responding to the request until 40 days after the announcement of the results except in cases where this is more than five months after the date of receipt of the request, in which case access must be granted at the end of five months. Where a data user takes advantage of the extended period for compliance with requests for access he must, when he finally grants access, reveal all the data which he has held during the period since he received the request, even if some of this has since been removed from the computer.
This amendment meets the concern which has been expressed by many examining bodies that the examination timetable would be seriously disrupted if they had to divert resources to dealing with subject access requests at the very busy time between completion of examinations and announcement of the results. The amendment will generally enable them to put requests for access to one side until the results have been announced but ensures that data subjects are not disadvantaged by users deleting data, such as unmoderated scores, which the subject would have been entitled to see had his request been complied with within the normal 40-day period. It is therefore fair to both subjects and users and I commend it to the House, and to the noble Lord, Lord Mishcon. I beg to move.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
Lord Mishcon: My Lords, this is rather a fun amendment in many ways. by virtue of the fact that I am now told that the technical subject with which we are dealing is that of raw marks. There was a time when I could talk on behalf of my children but I can now talk on behalf of my grandchildren and tell your Lordships who are also in the same position of being grandparents that there are many occasions upon which grandchildren have described the marks they have recieved as raw marks. However, it is not this definition with which we are dealing today. It is the question of marks which are possibly preliminary marks and not final marks. Therefore, the right of access to these is a matter of obvious concern to examiners and might be of more obvious concern to students.
However, there is one point of clarification that the Law Society has sought on this matter. I have had an opportunity of giving notice of it to the Minister. I think it is going to be very much more brief if I read a paragraph of the letter addressed by the Law Society to the Home Office and then ask the noble Lord if he will kindly deal with it. The Law Society said in that letter:

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"We were glad to see the new clause on examination marks which does appear to meet the problem of premature access to results. I had hoped, however, that the debate on the new clause would have clarified the relationship between sub-section (3)"—
If I may pause for a moment in parenthesis, it is of course subsection (3) of amendment No. 42 now before us—
"and Clause 21(7)"—
again I say in parenthesis, that that is Clause 21(7) of the Bill—
"so far as the question of raw marks is concerned but the point was not mentioned. It would seem that, apart from the new clause, clause 21(7) would permit the examining authority to withhold from subject access any items which were amended or deleted between the date of receipt of the request and the date when it is complied with provided the amendment or deletion would have been made regardless of the receipt of the request. However sub-section (3) of the new clause seems to require disclosure of items amended or deleted during the period between the request and the date of compliance, but only if compliance is more than forty days after the normal time limit. I am not sure whether I have got this right"—
says the representative of the Law Society, if I may put that in parenthesis—
"or how exactly it will operate in relation to the moderation of raw marks. It would seem to depend in part on whether this is done by way of amendment to or deletion of data rather than addition to data and partly on how soon the results can be announced. I cannot help feeling that this is confusing for examining authorities and I wonder whether the opportunity could be taken to explain how the new clause is intended to operate in this respect when the House of Lords considers the Commons amendments to the Bill."
Then he courteously says:
"I am sending a copy of this letter to Lord Mishcon in case he may wish to ask for clarification on this point".
My Lords, I do.
Lord Elton: My Lords, how I sympathise with and recognise the sentiments expressed by his correspondent, in parenthesis. Subsection (3) is designed to ensure that data subjects are not unduly disadvantaged by having to wait more than the standard 40 days for a response to their request for access. Normally where a request for access is made access will have to be granted to the data as they stood when the request was received, except that the user may take account of any changes which he has made as a matter of course since receiving the request. In other words, the subject will probably get a copy of the data as they stood when the request is complied with, that is, at the time before the end of the 40-day period. Now where the examination data are concerned, there will be raw, unmoderated marks which will be recorded and possibly from time to time amended, deleted or added to the data. If the user were allowed, in effect, simply to grant access to the data as they stood at the time the request was complied with the subject might in fact be deprived of data which he would have received had his request been complied with within the normal 40-day period.
Subsection (3) therefore ensures that this cannot happen by saying that where the user takes advantage of the extended period within which to comply with a request for access he will be subject to a special regime which will require him to give the subject not only the data which he currently holds but also any data which he has held between receiving the request and complying with it. In practice, this means that he will have to keep a record of any changes or additions or deletions which are made, and will have to give all this
1186
data to the subject. This is, as it were, the cost of the special provision.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
On Question, Motion agreed to.
1.22 p.m.

COMMONS AMENDMENT
43 Clause 34, page 26, line 22, at end insert—
(" (1A) The Registrar may consider any complaint that any of the data protection principles or any provision of this Act has been or is being contravened and shall do so if the complaint appears to him to raise a matter of substance and to have been made without undue delay by a person directly affected; and where the Registrar considers any such complaint he shall notify the complainant of the result of his consideration and of any action which he proposes to take.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 43, to Clause 34. It heralds an old friend, a friend whose appearance would, I think, have been particularly welcomed by the noble Lord, Lord Avebury. Clause 34 of this Bill imposes on the registrar a duty to promote the observance of the data protection principles, and Clauses 10 to 12 provide him with his armoury—the weapons which he needs to ensure that the principles are complied with.
There will be very many data users—so many that the registrar could not realistically be expected to supervise them all without assistance from data subjects. That assistance will take the form of complaints from subjects about the activities of data users. We have always seen complaints as providing the registrar with the basic information which he will need to fulfill his duties, and it was partly because this was implicit in the scheme established by the Bill that we felt it unnecessary formally to place him under a specific duty to investigate complaints. We also wanted to avoid introducing an undesirable degree of rigidity into the system.
The noble Lord, Lord Avebury, clearly was not alone in believing that the investigation of complaints was such a crucial and integral part of the registrar's functions that it ought to be recognised statutorily. The same point was pressed with some force in another place, and the Government decided therefore that it would, after all, be right to make explicit mention in the Bill of the registrar's function in respect of complaint. This amendment therefore makes it clear that the registrar has a duty to consider complaints which appear to him to raise matters of substance, provided the complaint has been made to him without undue delay by a person affected directly.
The formulation used in the amendment should avoid the danger of the registrar getting bogged down with trivial or ill-founded complaints, while making it clear that he retains a discretion to investigate complaints even where they are not covered by his general duty—for example, where a complaint is made by someone not affected directly but which reveals a matter of some importance. I beg to move.
Moved, That this House doth agree with the Commons in the said amendment.—.(Lord Elton.)
Lord Mishcon: My Lords, we on these Benches were associated with the noble Lord, Lord Avebury, in our strong recommendation of some such amendment as this. Therefore, we are all delighted to see it.
On Question, Motion agreed to.

COMMONS AMENDMENT
44 Page 26, line 28, at end insert—
("(2A) It shall be the duty of the Registrar, where he considers it appropriate to do so, to encourage trade associations or other bodies representing data users to prepare, and to disseminate to their members, codes of practice for guidance in complying with the data protection principles.").
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in Amendment No. 44, to Clause 34. The amendment places upon the registrar a duty to encourage trade associations or other representative groups to draw up codes of practice giving guidance for their members on compliance with the data protection principles. This is something which many of your Lordships wished should be put in the Bill. and I do not think I need dilate further. I beg to move.
Moved, That this House doth agree with the Commons in the said amendment.—(Lord Elton.)
Lord Mishcon: My Lords, I can well understand why the noble Lord the Minister does not wish to dilate upon this matter, in view of the pressure he was under at a former stage of this Bill to agree to a statutory code of practice, and if he did not agree to that at least to try to make it more likely that a code of practice would in fact ensue. There is not a statutory code of practice under this amendment, but at least the registrar is put under certain duties here in regard to encouragement of codes of practice, and naturally we welcome a compromise achieved in the Commons which we could not achieve in the Lords.
Lord Elton: My Lords. the only constraint which led me to spare your Lordships the speech I have before me. which trembles almost on my teeth for delivery, was the pressures of time at this stage. not the pressures of argument at another stage. I beg to move.
On Question, Motion agreed to.

COMMONS AMENDMENT
45 [Printed earlier.]
Lord Elton: My Lords, Amendment No. 45 has already been spoken to. I beg to move that this House doth agree with the Commons in their Amendment No. 45.
On Question, Motion agreed to.

COMMONS AMENDMENTS
46 Clause 40, page 30, line 35, leave out from ("above;") to end of line 38.
47 Clause 40, Page 30, line 43, leave out ("as aforesaid") and insert ("by the data user in question since before the end of that period")
48 Clause 40, Page 31. line 5, leave out from ("above") to end of line 7.
Lord Elton: My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 46. 47 and 48, to Clause 40. These amendments
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are designed to improve the remedies available to data subjects in respect of inaccurate, Old data. Previously the Bill provided that compensation could not be claimed if the subject suffered damage as a result of inaccurate data which had been held since before the end of the initial six-month period, during which users will be required to register. even if the damage occurred after the period had elapsed; nor could such data he ordered to be rectified or erased.
This was because initially we had thought to limit the liabilities and obligations of data users, who might have vast quantities of data which they had collected, possibly many years previously, whose accuracy they could not necessarily vouch for. We thought it unreasonable to expect them to go back through all their old data, trying to establish their accuracy, and in particular took the view that it would be unjust to allow the registrar to refuse registration or to de-register a user because of inaccuracy in old data. The Bill therefore disapplied both the courts' powers and the powers of the registrar in respect of inaccurate, old data.
However, on reflection this seemed unnecessarily harsh on the data subject, who would be unable to obtain redress for any damage caused to him by old data, even if the damage arose long after the data protection scheme had been in force, and who similarly would be unable to have such data rectified or erased. These amendments therefore remedy this situation by allowing the courts their normal powers to order compensation, rectification or erasure in respect of data held before the end of the initial six-month period, while leaving the registrar's powers unchanged. Therefore, they improve the position of data subjects without placing data users at risk of action, and possibly of de-registration by the registrar. I commend them to your Lordships.
Moved. That this House doth agree with the Commons in the said amendments.—(Lord Elton.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
49 [Printed earlier.]
50
Lord Elton: My Lords. I have already spoken to Amendments Nos. 49 and 50. I feel such a release at seeing the red light on the end of this train finally disappearing into the future that I want to thank noble Lords who have patiently stuck with it all the way through from First Reading, as it were, in this House. These are my last two amendments. I beg to move them in a sense of gratification and comradeship with all of your Lordships, wherever in the House you sit.
Moved, That this House doth agree with the Commons in the said amendments. —(Lord Elton.)
Lord Mishcon: My Lords, in answer to such a warm series of words, obviously it would be appropriate for me, standing where I do, to thank the noble Lord the Minister and indeed Members in all parts of this House who have co-operated on such an extremely difficult Bill. I hope that at the end of it we really understand it. Nevertheless, we have done our best, and possibly my last comment, today being the day

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after yesterday (which is rather an obvious remark), is that, we having recognised the wisdom of the Commons in many respects, one merely prays over this weekend that the Commons will realise the wisdom of the Lords.
Lord Mottistone: My Lords, may I, as a humble Back-Bencher, add my thanks to my noble friend on the Front Bench for having steered this Bill through this House with such skill and care. I should like to say what a pleasure it has been working with him on it.
On Question. Motion agreed to.

Co-operative Development Agency and Industrial Development Bill
1.30 p.m.
Lord Lucas of Chilworth: My Lords, I beg to move that this Bill he now read a second time.
We move from the cheerful camaraderie of the last Bill to consider a very different kind of Bill, but certainly not one of any less importance.
The Bill, as your Lordships will have seen, is basically in two parts. The primary purpose of Part I is to provide further funding for the Co-operative Development Agency. The agency's initial funding under the Co-operative Development Agency Act 1978 will have been exhausted by August this year and the Government have therefore had to decide the future of the agency. The Government recognise the valuable and important work done by the CDA and have therefore decided to make further funds available to enable it to continue its activities. This requires legislation. We have also proposed certain changes to the provisions of the 1978 Act to assist the work of the agency and to encourage it to greater self-sufficiency.
In continuing Government support we believe the agency should he encouraged to maximise its own earning powers and to seek increased support from the private sector. For that reason we intend to maintain funding at the present level of £200,000 a year, which will be made available for a period of six years. Provision for this funding is being made in Clause 1 of the Bill. It raises the limit on the aggregate amount of grants which the Secretary of State may make to the agency to £3 million. The present limit is £1.5 million which, as I have said, will be reached by August this year. Noble Lords will note that on the basis of funding at £200,000 a year for six years, there is an extra £300,000 allowed. This is to give the Government flexibility in any future decisions on the funding levels and timescale.
Clause 2 extends the functions of the agency. First, it enables the agency to make grants or loans to promote the establishment or development of cooperatives. But the agency may not use grant money provided under Clause 1 or borrowed money to finance such grants or loans. The reason why we are giving the CDA grant and loan-making powers is to enable it to influence the use of any development funds that may be available for co-operatives.
Clause 2 also amalgamates the agency's existing powers to review and recommend training courses with that of an additional power to provide training
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courses for persons involved in the co-operative movement. Under its present powers the agency can undertake training only where this furthers its other functions. In order to provide the agency with wider powers in this respect it has now been given an explicit training function. Any training undertaken by the agency will be geared to the needs of co-operatives and will not duplicate the work of the MSC or any other Government institution.
The third important provision in Clause 2 is to remove the block on the agency undertaking commercial activity and forming partnerships. The underlying objective here is to encourage the agency to become as self-sufficient as possible. This will not widen the range of functions which the agency is empowered to undertake. but by being freed to carry out commercial activity the agency can charge what the market will bear for its services and use any profits made from such services to support other activities. By removing the prohibition on forming partnerships the agency can share in profits from collaborating with others in activities such as providing training courses. Clause 2 also makes provision for the Secretary of State to give general or specific directions to the agency and it is intended as a reserve power.
Finally—in so far as Part I is concerned—in Clause 3 we are including provisions to wind up the agency by order. The 1978 Act contained no provision for this and while the Government are fully committed, as I said in my earlier remarks, to maintaining the agency for the next six years, it is the case that if at any stage the agency had to he wound up this would, as matters stand at present, require primary legislation. We have deemed it prudent to remedy this deficiency by this clause, which sets out the general arrangements for dissolution. Noble Lords will. I am sure note that termination of the agency would be subject to a consultation procedure and an affirmative resolution of each of the two Houses of Parliament.
The remaining provisions of this Bill principally concern changes to the Regional Development Grants Scheme—changes which were foreshadowed in the White Paper on regional industrial policy published last December.
Successive Governments have operated a regional policy of one form or another for many years. Yet the areas of most disadvantage now are the areas which were the most disadvantaged 50 years ago. That does not mean that regional policy has been ineffective, but what it does suggest, I believe, is that the time has come to review past policies and to see whether and how change can be brought about. That review has been conducted and its results are summarised in the White Paper.
The principal problem of the assisted areas is unemployment, and it is to that problem that the revised regional policy is addressed, with the specific objective of reducing regional disparities in employment opportunities. This Government are concerned about unemployment and in a variety of ways seek to improve the economic climate which will lead to the creation of jobs; not here today, gone tomorrow jobs, but secure, long-term jobs. It is to this end that the new scheme of regional development

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grants has, for the most part, been designed. In future, and except normally for small firms, grant will be related to the creation of jobs either in the form of a capital grant or, where more advantageous, as a job grant. The scheme is to be extended to parts of the service sector, a sector where there is great potential for job creation. And there will be a significant reduction in the amount of regional assistance to projects which do little more than shuffle jobs from one part of the country to another. I believe that these proposals will be welcomed.
We recognise, however, that other changes may not be so welcome; in particular the exclusion from automatic regional development grant of modernisation projects which do not create jobs. Much was made in the other place of the importance of modernisation investment in the safeguarding and maintaining of existing employment and of the fact that, although new Section 3(5)(b) in Schedule 1 of the Bill permits it, the Government intention is that projects which safeguard or maintain employment but do not create new jobs will not be eligible for automatic grant except in the case of small firms.
As a further explanation, let me say that the Government in no way underestimate the importance of modernisation. Indeed, they have done more through the many technology support schemes to encourage such investment than perhaps have any previous Government. The reason for the exclusion from automatic assistance is that a judgment on whether or not a project preserves jobs is of necessity a selective one, inconsistent with an automatic and predictable scheme. But these modernisation projects are not being denied regional support. They will continue to be eligible for regional selective assistance, which in many cases at present is payable in addition to automatic assistance, since it is negotiated as the minimum necessary to induce a project to proceed. It follows that if automatic assistance is not available, the minimum necessary in terms of selective assistance alone may need to be higher.
The other major changes are the introduction of a cost-per-job limit and the introduction of a job grant. The cost-per-job limit is designed to ensure that the amount of capital grant payable towards a project is directly related to the number of jobs created by that project and is limited to a reasonable amount for each job. In the past grant has for some projects been equivalent to £200,000 for each job created. The Government consider that to be excessive. The costper-job limit will end that excess. Job grant is introduced as an alternative to capital grant and will be especially relevant in the service sector, where many activities are labour rather than capital intensive and consequently grant based on a percentage of capital expenditure may not provide a sufficient incentive. It is also part of the move away from present unjustifiable bias towards capital intensive industry.
I turn now to the individual provisions of the regional aspects of the Bill. Clause 4 of the Bill permits the designation of assisted areas by reference to wards, travel-to-work areas, defined by the Department of Employment or any other area existing for the purposes of any Act or statutory instrument. The boundaries of the areas can be frozen as at the date of
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the designation. Assisted areas have hitherto normally been designated by reference to employment office areas. However, the change effected by Clause 4 is needed because of the forthcoming changes in the way in which travel-to-work areas, the component parts of assisted areas, are put together.
Clause 5 provides for the new scheme of regional development grants as set out in Schedule 1 to the Bill to be substituted for the existing Part II of the Industrial Development Act 1982. The new Section 2 set out in Schedule 1 provides that grant may be paid in respect of a project of investment in the productive capacity or productive processes of an undertaking. The payment of grant in respect of a "project" is a fundamental change in approach from the old scheme. It is intended that, except where the qualifying date of a project is after a change in the scheme or the map has been announced but before the change comes into effect. the amounts of grant the project will receive cannot be reduced by any subsequent reductions in the rates of grant or cost-per-job limit or a map change. Section 5 provides that projects may on the other hand receive the benefit of a subsequent increase in the rates of grant.
The new Section 3 provides in effect that regional development grant will be paid only to projects the purpose of which is to provide or effectively "modernise" capacity. This will exclude replacement investment, in line with the Government's obligation to the European Commission to end grant for replacement investment by the end of 1984.
The new Section 4 provides that the amount of grant payable in respect of a project will be either a percentage of capital expenditure (subject to the costper-job limit if applicable) or an amount per job created, whichever is the more favourable to the applicant. The cost-per-job limit is defined in new Section 5. It is not intended to apply this limit to projects undertaken by small firms, for whom we aim to make the scheme as simple and as straightforward as possible. The new Section 5 provides for the qualifying activities, percentage of capital grant, job grant and cost-per-job limit to be set by order.
As I have mentioned the aspect of small firms on a number of occasions. it might be helpful if I say that we are viewing small firms as probably being those firms employing 200 persons or fewer. In these remarks I have sought only to outline the main changes. I have no doubt that we shall discuss these and other changes in more detail when we come to the later stages of the Bill.
Regional policy is by its nature a selective policy in that it must focus on particular areas. What we are doing is concentrating our resources and making them go further. In the same way as it is necessary to concentrate on designating the areas of most need, it is also necessary to concentrate resources on achieving objectives. We are making the policy job-related and hence more cost-effective in meeting the principal need of the regions. Those in assisted areas will gain from a better targeted policy, and everybody benefits from the increased cost-effectiveness because everybody, including those who live in assisted areas, pays a contribution towards those costs. Furthermore, the success of regional economies ultimately depends

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on the success of the national economy. The operation of a cost-effective regional policy will, we believe, contribute to the health of the national economy. I therefore commend this Bill to your Lordships. I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read a second time.—(Lord Lucas of Chilworth.)
1.45 p.m.
Lord Bruce of Donington: My Lords, we on this side of the House should like to thank the noble Lord for having taken us briefly through the contents and purpose of these two Bills. I hope that the House will bear with me, before I come to deal with the subject-matter of the Bills concerned, while on behalf of the official Opposition I enter a formal protest against the way in which this whole matter has been handled by the Government so far.
Regional development in the United Kingdom, as in Europe, is a matter of very great importance indeed. Even on the Government's own say so, to which I shall come later, the efforts that have been made in this direction have already met with considerable success. I would suggest to the House that a Friday afternoon is not the best occasion on which an important Bill of this kind should be discussed and the very weighty matters associated with it correctly evaluated. That is my first point.
My second point concerns the combining of two Bills into one. Although, of course, all subjects affecting the economy are interrelated, these two matters which we are invited to discuss together this afternoon are two quite separate and independent matters, each of which merits very serious consideration by the House. By holding the debate on a Friday afternoon, coupled with lumping two Bills together in one (presumably due to some ministerial manoeuvre, as it were, to nullify any legislative quota by way of the number of Bills put on a department), one can understand that one can meet the allocated quota and at the same time do what one really wants. But so far as this House is concerned, a full-dress debate could take place on separate days, and the matter could be dealt with subject by subject. We do not really believe that this is the way in which, in this respect, to treat either another place where a protest has already been entered, or this House.
I have a third point to make. A Bill of this kind, an important Bill of this nature, merits being brought to this House by the leading spokesman for the Department of Trade and Industry. According to the grey book, there are two spokesmen on behalf of the Department of Trade and Industry. One is the noble Lord, Lord Cockfield, whose interest in economic affairs is so well known if not well advertised, and the other is the noble Lord, Lord Belstead.
I am second to none in paying tribute to the abilities of the noble Lord, Lord Lucas of Chilworth, who I gather has recently, since the publication of the grey book, been appointed to act as a third party to represent the Department of Trade and Industry. I sincerely hope that such words of praise from me and the real regard that I have for him will not unduly prejudice his future promotion. With all respect to the noble Lord, who is one of the hardest worked
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Members of the Front Bench opposite, I do not think he would take it amiss if I thought it more appropriate, and the House thought it more appropriate, that, on a matter of this kind on which the noble Lord Lord Cockfield, is such a master in terms of economic perceptions, it would have been a good thing had the noble Lord himself been here.
I am sorry to detain the House further but I have another point which is linked with the last. We on this side of the House have already made representations through the usual channels on the growing habit on the Front Bench opposite of winding-up speeches coming from the Government Front Bench which appear to have been pre-drafted and pre-briefed with the result that whatever happens in the debate itself, whatever arguments are brought forward, we on this side of the House are often faced with a reply that consists of little more than a rendering, however skilful, of a brief pre-provided by the Ministry concerned.
On this matter, as your Lordships will know, we have a large number of questions to ask. Some of them are important questions on which we shall demand a reply, and demand a reply today not at some future time, nor by correspondence, nor by any of the other avenues which are so often used for this purpose. I sincerely hope that the words that I have felt constrained to utter before we start dealing with this Bill will be taken carefully into account by the Leader of the House.
Last night's proceedings, without touching on them in any detail, indicated that this House does not like being taken for granted. We are the official Opposition in this House together with our colleagues, and we do not like being taken for granted either. We sincerely hope therefore that some constructive effort to respond to these debates properly may be made in the future.
I turn to the first of the Bills, the Co-operative Development Agency. Your Lordships will be well aware that up until now the activities of the agency have been governed by the Co-operative Development Agency Act 1978. It is universally acknowledged—and the Minister was kind enough to underline it today—that the agency itself has carried out considerable valuable work in this country. My noble friends Lord Graham of Edmonton, Lady Nicol and Lord McIntosh of Haringey will deal in more detail with this aspect of the matter.
A glance through the Act of 1978 will give a fair idea to those of your Lordships who are not familiar with what the agency does, just what its functions cover. They are quite formidable. The functions of the agency are:
"to promote the adoption and the better understanding of cooperative principles…; to identify and recommend ways in which the establishment, development and evolution of co-operatives might be facilitated; to identify and recommend projects …; to appraise and evaluate projects …; to advise co-operatives, persons proposing to establish co-operatives …; to provide a forum for discussion …; to make recommendations to government departments …; to keep under review the establishment, development and evolution of co-operatives throughout the world … to undertake such studies and research as the Agency considers necessary or expedient".
It is also charged with making recommendations in regard to training, and, with the new powers proposed

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under this Bill, will undertake, in association with others, training itself.
These are important functions. It is not wise, particularly in a period where confrontational politics are the order of the day and are lauded by the party opposite, to forget that the co-operative movement in the United Kingdom is a powerful one. Despite all the confrontational politics which afflict us at this time, the desire for co-operation in enterprises within modern society is still strong. It may perhaps stick in the gullet of some of the more extreme members of the Conservative Party to concede this principle. They are all for competition: the weakest to the wall, and the devil take the hindmost, as indeed the recent almost canonisation of Professor Hayek only more effectively underlines.
They may not find it politically expedient to denounce the co-operative movement. They may find it difficult to decry it, but of course there is a difference between whole-hearted support which any government within society ought to be extending to the co-operative movement and one that remains either effectively neutral or, in its long-term aspirations, hopes that co-operation in the sense of proper development will go away. Therefore, within this Bill one regards with some dismay the power to which the noble Lord has already referred for the Minister to be able to give directions. The new Clause 3A says:
"The Secretary of State may, after consultation with the Agency, give the Agency directions of a general or specific character as to the discharge of its functions: and the Agency shall comply with such directions".
No real reason has been given for the insertion of this power, particularly in the light of the Government's admission that the Co-operative Development Agency Act 1978 has worked perfectly satisfactorily. Why should the Minister now require to give directions? I ask this particularly with reference to the present Minister, Mr. Tebbit, whose political utterances are not well known for containing any expressions of co-operation when dealing with the affairs of others, especially those for whom he has a theoretical or ideological dislike. We on this side of the House would probably seek to delete this clause from the Bill.
More sinister than ever is, of course. Clause 3, to which the Minister referred, which indicates:
"The Secretary of State may, by order, on such day as he may appoint—

(a) terminate the exercise by the Agency of its functions except for the purpose of winding up its affairs;

(b) vest in himself any property, rights or liabilities of the Agency; and

(c) dissolve the Agency."

I know that the noble Lord has given an undertaking—although not phrased in those terms, it was phrased as an intention—that there is no intention of winding up the agency prior to the expiration of its funding term. But what is to stop him under this Bill from doing so? Nothing at all. The noble Lord has said that it is the intention that it should be funded up to the sum concerned. Within a fortnight, under the provisions of this Bill, the Secretary of State could, by order, terminate it without any redress whatever. The
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excuse given is that they would have to bring in legislation if the agency were to be terminated.
The Government do not really like bringing in legislation for that kind of thing because legislation is subject to widespread debate in both Houses and is subject to amendment. The Government, with an ill-concealed arrogance. more than ever now are taking powers by order to do what they want to do without effective debate in either House. It may be that my colleagues will consider it wise to impose in Clause 3 a time limit making it absolutely impossible for it to be wound up until after the expiration of a certain period, to which my colleagues and I will give some consideration. So much for the Co-operative Development Agency, to which my noble friends behind me will also give their attention in the course of this debate.
I now pass to the proposed amendments to the Industrial Development Act 1982. I am surprised that this Bill should have been brought forward at this stage. As your Lordships will be aware—the noble Lord referred to it himself—the Government published in December 1983 a White Paper on regional industrial development (Cmnd. 9111). It is made quite clear in that that the plans for the redeployment—if I may use the term—of areas to receive regional or other assistance would not be available until the autumn. Is there therefore any reason why this Bill could not have been brought forward in the autumn, when those of us in this House interested in regional affairs would know the approximate geographical limitations which noble Lords opposite and the Government have in mind? As it is, we are once again given a skeleton Bill which needs to be illuminated by a comprehensive picture of the totality of the operation that the Government have in mind. Until we can see the new map of the proposed assisted areas, it is quite impossible for us to assess the totality, the whole picture. that the Government have in mind.
I repeat that it would have been far better if the introduction of the Bill had been postponed until after the Government's main plan had been made more fully known. It would also have been helpful if, at the same time as they published the White Paper, the Government also had had the courtesy to publish some of the evidence that they considered in arriving at their conclusions. As your Lordships are well aware, this principle is followed by Select Committees, so that reports or matters which they have considered are illuminated by a sight of some of the submissions which they have taken into account. That has not been done in this case.
I now return to the whole question of the areas. So far the assisted areas are well known, but the Government have made clear, and have already said so in the White Paper, that owing to the incidence of large scale unemployment,
"Unemployment is now high throughout the country not just in the Assisted Areas; there are fewer mobile investment projects and increasing competition for them".
The Government can say that again. Let us consider the position in the regions when the noble Lord's Government took office in May 1979 with the position now. In 1979, excluding Northern Ireland, the highest rate of unemployment was in the North region with

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7.9 per cent. Now the unemployment in the North region is 17 per cent.; two and a half times as much. If one goes through the current figures for regional unemployment, one finds that the lowest figure, which is for the South-East, with 9.4 per cent., is greater than the highest figure in May 1979, which was 7.9 per cent., in the North.
Not only has the plight of these poorer regions suffered; but Government offices have now succeeded in producing a situation where practically every region is fairing worse than did the worst regions in 1979. In fact they are rapidly on the way—and the opinions of the Bank of England published this morning are not very encouraging—to creating a distressed area comprising the whole country, apart from certain secluded areas in the South-East, possibly in East Anglia, and also in the South-West. It is within this context that the contents of this Bill and the Government's expressed intentions have to be considered.
I observed that in the course of his opening remarks the noble Lord made no reference to the total savings that he expected would be made as a result of the operation of this Bill. This point was referred to in the debate in another place, but it has not been referred to here. According to the Explanatory Memorandum in regard to the original Bill it was hoped that there would be a saving of £150 million.
It is perhaps conceivable that things in the depressed areas are far worse than they were before. It is perhaps also conceivable that new distressed areas are being created. I should like to draw the attention of the noble Lord to the West Midlands in particular. In 1979 unemployment there was running at 5.1 per cent. It is now running at 14.7 per cent.; nearly three times the earlier unemployment figure in the West Midlands. So there we already have a new distressed area contained within the region. Is it really reasonable that under those conditions the total amount of relief should be reduced? This flies in the face of the advice that the Government themselves have received but which they have not published—notably by the renowned firm of accountants, Deloitte, who made a report upon this. I quote from a report in the Financial Times of the 5th of this month:
"Deloitte, a major firm of accountants and management consultants, has 30 offices in the UK whose clients, it states, 'are an integral part of the regional industrial structure. Therefore, directly as a firm and indirectly on behalf of our clients, we have considerable interest in regional policy'."
What is their recommendation? I will read only a small portion of it:
"With the acute shortage of job opportunities persisting in many areas, the current requirement is for a strengthening of regional policy through the sharpening of instruments and, at minimum, maintenance of the overall level of funding."
That is the minimum requirement which is recommended by a very well known accountancy firm, well skilled in these matters, well skilled in project assessment, well skilled in project evaluation and enormously experienced in the development of businesses of all kinds.
The Government have come forward with the proposal that their aid has to be linked to job creation. There can be no exception to that, except that I thought that the noble Lord was being a little less than
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frank with the House when he put forward the cost of individual jobs at something like £200,000 when, in the Government's own White Paper, after taking into account the operation of the multiplier factors, the cost of increasing jobs (which they put to the creation of jobs of 500,000) works out at something like £35,000 per extra job created. This is a perfectly acceptable figure—£35,000 capital investment to bring a saving at a minimum in terms of lost tax revenue, unemployment benefit of £5,000 a year, as is well known.
What is the capital price of an income of £5,000 a year, or to put it another way profits of £5,000 a year? We should know perfectly well because the City assesses its share values on the basis of anything between a 6-times to 8-times multiple of the profits per annum. This is the way that capital values are arrived at. Who is to say that a capital expenditure of £35,000 per job is not a good investment on the ordinary conventional basis adopted by the City of London? Quite clearly, every new job gained saves £5,000 a year at minimum; and by now it may well be more than that. Let us consider the implications of it. Trident, for example, is going to cost £ 10.000 million—a useless object, if ever there was one, and an inflationary one at that since the end product does not enter into consumption. Diversion of the money from expenditure on this completely useless, ineffective piece of hardware could result in investment in the creation of over 300,000 jobs. These are the kinds of priorities which the Government should consider.
In the process of its White Paper, the Government have made a number of interesting admissions. I will not weary the House with quotations, although I can do so quite easily, but they have talked about the creation of 500,000 jobs since the inception. What an admission! The whole philosophy of the party opposite is to deny that the Government can do anything to create jobs. Time after time we have heard from the party opposite that the creation of jobs is really nothing to do with them; that it is a matter for market forces. It is a question of remaining competitive, and now they themselves admit that the expenditure of money can create jobs; and the logic of that is that money should be so spent.
The Government qualify this of course and have qualified it in their White Paper, although the noble Lord this afternoon has not ventured to underline it. The White Paper talks about genuine jobs. That brings me to the first question that I have to ask the Government. A certain folklore has grown up around the words "real jobs" or "genuine jobs". What we should like to have from the Government is a definition of what they mean by "real jobs" or "genuine jobs". Just what does the term mean? Has a nurse a genuine job? Has a doctor a genuine job? Has a coalminer a genuine job? Who are the people with what are called, by the Prime Minister very often, real jobs? Or does she really, mean real jobs for people who in the main agree with her philosophy?
We know, for example, that a real job has been created recently in the head of the Government's accountancy service. It is a real job presumably, and it is not going to cost £35,000. it is going to cost £85,000. We hope the job is classified by the Prime Minister as a real job and not an ersatz job. So can we have some

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definition of exactly what is meant? Common sense dictates the realities, and the realities are that there are, for example. a million houses requiring substantial rebuilding in the United Kingdom. At the same time there are 240,000 "real" people who are capable of building. What is to stop the two being put together? If at this stage the Government decided to spend money on putting the construction workers on the work of building houses would those be real jobs because the Government created them or would they be some other esoterically described job, the definition of which I will leave to the noble Lord? These things we require to know because they are important.
But one thing is for certain. In Europe, as has been well proved—and I speak now from my experience as for some time president of the European Parliament's Regional Affairs and Transport Committee—the rich countries are still getting richer and the poor countries are still getting poorer. Similarly, in this country, the rich persons are getting richer, and the poor persons are getting poorer; and the poor regions are getting poorer and the richer regions are getting richer. What we want from this Government is a proper regional policy carefully thought out. This Bill at present, read in association with the White Paper that preceded it, and read particularly in conjunction with the debates that have taken place in another place, offers no hope for the development of regional policy in this country. The noble Lord the Chief Whip will possibly recall—if he was here at the time—that I had to spend some minutes in dealing with purely procedural matters for which 1 very much regret he was not present but of which he will read in due course.
Lord Denham: My Lords, I hope the noble Lord will forgive me. I was just inquiring whether the Clock had been set at the beginning of the noble Lord's speech.
Lord Bruce of Donington: My Lords, I, too, have ears. We on this side of the House do not like the Bill in its present form. We do not like the method of its presentation. We shall examine it in far greater detail than has been possible today, bearing in mind that it took 27½ hours in another place in Committee; and we hope that on the next occasion that it is dealt with there will be the necessary expertise, without in any way casting any reflection upon the noble Lord, to be able to deal with some of the expert evidence that we on this side of the House will be able to bring forward.
2.20 p.m.
Lord Grimond: My Lords, I welcome the decision of the Government to continue the Co-operative Development Agency and Industrial Development Bill. Like the noble Lord. Lord Bruce of Donington, I am somewhat curious why they have taken the power to give it direction and to wind it up by order; but the Government have assured us that they are wholeheartedly behind the agency and therefore we must suppsose that there is nothing sinister in those parts of the Bill. though as the noble Lord. Lord Bruce of Donington, has said, we shall no doubt want to examine them rather carefully in Committee.
May I also ask the Government a little more about the training provisions of the Bill? Certainly some
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training in setting up a co-operative may be needed by those who wish to embark upon it, but I am at the moment the chairman of an organisation known as Job Ownership Limited, which attempts to promote co-operatives. We have found. first of all, that the most helpful thing the Government could do would be to reduce the appalling tangle of regulations in which anyone wanting to set up any business finds himself entwined. Secondly, most people who set cooperatives want help over such things as accountancy, the legal aspects and so forth. The CDA already do a certain amount of this but it would be helpful if the Government could explain a little more what they have in mind about training.
Thirdly, the CDA want more money. Everyone wants more money. and I do no more that put on record that. like many other institutions, they are keen to have more money. However, I would ask the Government: why is it that so much more money is forthcoming for agricultural co-operatives than for industrial and other co-operatives?
I attach the greatest importance to the furthering of the co-operative movement in all its forms. I believe that industrial organisation is in fact one of the most serious problems facing this country. I do not accept that the only alternatives are state socialism or the creation of large conglomerates in the private sector, which are now almost entirely financed by insurance companies, pension schemes. trusts and so forth. In fact they are owned by absentee owners who really have no direct concern in how the business is run. I believe in a third and very important method, and that is to involve the work force in the ownership and running of businesses. Nothing makes this plainer than the present appalling dispute in the coal-mining industry. It is quite apparent that nationalisation by itself does not stop confrontation in industry. Surely it is becoming apparent that we might at least experiment by encouraging the miners and their union to take a greater share in the running of their own industry. I would go so far as to say that we should hand over one or two mines to the miners and see what they can make of them. But in any case I believe that the encouragement of co-operatives is extremely important for the future of this country.
Another feature of this country which strikes me very much is its gross over-centralisation. We are one of the most centralised countries in the world and I believe that is largely the reason for the comparative failure of regional policy. All the money is pumped into the regions from the centre and we do not sufficiently encourage indigenous growth in the various regions. I ask for your Lordships' sufferance if I mention again Mondragon, which is a town in Northern Spain. It is the centre of some 60 or 70 co-operatives. These were set up with the idea of giving employment and of mustering vast patriotism, if you like, to the advantage of the area. A co-operative bank collects the savings and finances and guides these cooperatives, which now employ some 20,000 people.
There is nothing like that in this country. There is no system by which this can he done. Here the whole of the financing of the country is centred upon London. There is no attempt to retain local savings in the area where they are generated. There is no attempt to mobilise local patriotism to do something in their own

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area. If one takes the Shetlands, I have mentioned before that there are quite large sums available in the Shetlands, as one can see from the accounts in the savings banks. What happens?—they are taken south. And then what happens?—grants are sent back by London. Of course there is enormous wastage and you lose the motivation which you would get if the Shetlanders dealt with their own business.
When we come to the second part of the Bill, I must say it is no wonder the Government have been forced to do something about it because this is the system which has led to £68 million of public money being put into Sullom Voe in the Shetlands for the oil companies. The oil companies are not the most impoverished institutions in this country; and this huge sum has given very little real employment. It has simply been a subsidy to very rich companies—and we have seen what happened in Northern Ireland over De Lorean.
As the noble Lord, Lord Bruce of Donington, has said, this is really two Bills which have been spatchcocked together when they are really planned on quite different subjects. But there is a possible connection between them, which I am not at all sure the Government realise. The way to tackle regional development is through engaging local people in the regions more directly in it, and one way of doing that is by encouraging co-operatives. I am glad to say that I find I have a formidable ally in this field and that is the Scottish Trustee Savings Bank. It is prepared to see what it can do by retaining local savings in Scotland. Of course, Edinburgh is said to be an important financial centre and no doubt there is a lot of expertise in Edinburgh which could assist in this matter.
My first point is that I hope the Government will give every assistance to the savings bank in this direction to keep savings and to invest them where they are generated. I also hope that they will bring other agencies, as well as the CDA into this; for example, the Highlands and Islands Development Board and the Scottish Development Agency. They, too, should he made much more entrepreneurial and should encourage the active participation of local people in their work. There should not simply be institutions created in Westminster and sent to the highlands and islands, or wherever it may be, to try to put right the continual sucking of blood out of the regions of this country which has gone on for generations. That is the reason, in many cases, why the regions are in such poor shape; it is because they have been bled dry by London.
The next point that I want to make is that the Government could help in regional development and in co-operatives, as well as in small businesses generally, if they would allow the concession which is allowed to partnerships by which you can set off against tax the interest that is paid on borrowed money.
The Government will be well aware that the National Freight Corporation has been a great success after its management buy-out. The chairman has just said that there is an entirely new motivation in the company; one which is very much needed in British industry as a whole. If that is to be carried on, there is at present an advantage given to the people who take up the shares in the first place, because, as I understand
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it—I shall be corrected by the experts on the Government Front Bench if I am wrong—they can set the expense of borrowing money to buy the shares against tax. But it is only for 12 months, so that the next generation get no such advantage. There appears to be no reason for this and I believe that there are members of the Government who want to see it changed. I hope that it will be changed very soon, because at the moment it is some handicap on the creation of further management and other buy-outs of a similar sort, which ought surely to be very much encouraged.
There is another aspect, in that the Government are deeply worried about social services and their expense. If they will go as far as Italy, they will find there that co-operatives are now engaged in running the social services. They are encouraged by all parties but the main party which has encouraged co-operative social services is the Communist Party in Bologna. They are extremely successful and the clients can join the cooperative. I went to an old folks' home in Bologna, which was run partly by the old folks themselves and partly by the social workers as part of the co-operative. That removes from the central exchequer a lot of the expense, it involves local people and it does a great deal of good for the clients.
Here, again, is a field where co-operation has a great deal to offer. I am not saying that all business can be run by co-operatives, because it cannot. I am not saying that there is any golden form of co-operative. But we know that big businesses, such as the National Freight Co-operation, right down to small businesses can be run successfully. I think I am right in saying that there were 300 or 400 founded last year. This seems to me a third way.
What I would say to the Government is that, if it proves that the only alternative to nationalisation is the present form of privatisation, by which we replace nationally owned monopolies with privately owned monopolies, in which the consumer gets no better deal and of which the result is that whether the issue is a success or a failure the City seems to do extraordinarily well out of it, then people will not support this system much longer. When, possibly, a more leftish-inclined Government than would be provided by our colleagues in this House comes into office, we shall simply find that a very great many of the commercial, financial and industrial operations of this country are renationalised. The public will say, "Look at what happened under privatisation". Privatisation should mean that the workers themselves now have a bigger stake in the country, and, although it is happening very slowly, it needs to happen much faster.
2.30 p.m.
Baroness Nicol: My Lords, before coming to the few points which I feel I can make on this Friday afternoon, I should like to endorse what my noble friend Lord Bruce of Donington has said. It really is a great shame that a subject so important as this should be taken on a Friday afternoon. Not only are we under pressure of time, as has been shown by the arrival of the Chief Whip a short time ago, who obviously is disturbed at the length of time we are taking over it, but many people who are directly affected by the Bill live in regions which make it impossible or very

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difficult for them to be here on a Friday. I hope that the Government will take this point on board and that for the sake of these people the subsequent stages of the Bill will be dealt with at a more sensible time.
I am going to confine my remarks to the cooperative side of this tandem. I very much welcome the Government's decision to renew the funding for the next six years, although it seems a little mean that there is to be no allowance for the effects of inflation. The funding is to remain the same over the six-year period with no allowance for inflation. With regard to the period of six years, the experience of the noble Lord, Lord Oram, who was the first chairman of the CDA between 1979 and 1982, is very relevant. He regrets that he is unable to be here today. However, he tells me that, as he looks back to his period of office, three years was a surprisingly short time for establishing the agency on a sound basis. No sooner had this been done than the board were faced with the problem of seeking a further period of life for the agency, and a great deal of effort had to be put into persuading those concerned that this was a desirable objective.
This meant that much time and energy were spent on this activity which could have been better spent on the practical promotional work for which the agency was set up. Six years is a much more reasonable working period, which will enable the chairman and the director to plan ahead with a reasonable expectation of continuity. Or will it? When we read the Bill we see that there is no guarantee, in spite of the Minister's opening remarks, that the agency will continue for six years. That is not actually written into the Bill. The Bill contains a clause which says that the minister can wind up the agency at any time. This is another reason why we shall be seeking changes to the Bill at the Committee stage. The noble Lord, Lord Oram, asked me to say to your Lordships that he hopes Clause 3 can be omitted entirely from the Bill.
We welcome wholeheartedly the power to make grants or loans. This was a great disadvantage under the old scheme. We welcome also the power to provide training courses. Training in basic business skills is one of the greatest needs for new co-operatives. I serve on the board of a local co-operative agency and have direct experience of what happens, particularly with small co-operatives. The availability of help is at present very patchy indeed. It would be of enormous value to local co-operatives.
May I say just a word about the place of cooperatives in society. The noble Lord, Lord Grimond, said a good deal about this subject. It cannot he said often enough that in a world of such great economic change as we are living in at the moment. the cooperative way of life has great potential. There are already many parts of the world where it is the only way of surviving—and not simply in Northern Spain. There the co-operative economic process is not simply a fringe activity, as it seems to be in this country, where it is associated in many people's minds with health foods, sandals and beards: it is a real economic way of life.
The fundamental difference between a co-operative and a small business, as I am sure many noble Lords know, but perhaps some do not, is that irrespective of your input in terms of work or of money, a cooperative entitles you to an equal vote in what is happening to the co-
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operative entitles you to an equal vote in what is happening to the co-operative; in other words, the business in which you are engaged. That is the fundamental difference between a co-operative and a small business.
Leaving that aside, the term "co-operative" can embrace enormous differences in approach about whether there are employees, the type of business done, and the size of the business. I understand from the best evidence I can obtain from a number of sources that the cost per job in co-operatives is about £1,500. Very often, that cost is non-recurring; it costs £1,500 to set up one job in a co-operative. The rate of failure of co-operatives is considerably less than the rate of failure of small businesses. The cost to the Exchequer of each unemployed person—as my noble friend Lord Bruce of Donington has said already—is of the order of £5,000, and it may be even greater. That is the cost per annum, and it is without considering the social cost of unemployment in terms of its effect on family life. I hope we shall be saying more about that aspect in a debate next week.
When one considers that the cost to the Exchequer of, for example, propping up the De Lorean car company, was £7,500 per job, then the investment in co-operatives makes very good sense indeed. There is nothing new in the co-operative idea but in recent years the local value of establishing co-operatives is being recognised. As social planning becomes a more important feature of economic planning, cooperatives are locally created and tend to remain locally based, bringing stability into the community in which they are situated. The noble Lord, Lord Grimond, mentioned this point also. In this way cooperatives benefit the whole local structure.
The point that is very often overlooked is that cooperatives also provide unique opportunities for people who are otherwise disadvantaged in the great Tory objective of standing on their own feet. People who are perhaps coloured or disabled, or who have other disabilities, can form themselves into cooperatives in order to help each other and keep themselves free of reliance upon social security benefits and other Government help. I would have thought that this in itself would commend cooperatives to the Government as a reason for making greater investment in them.
The strengthening of the CDA's powers will give new impetus to the whole co-operative scene and will allay some fears about the Government's intentions. However, the Bill would be much improved if it did not contain the seeds of its own destruction, as it does in Clause 3. I hope that as the Bill progresses we shall be able to improve that aspect of its provisions. With that qualified welcome, I hope that the Bill will proceed.
2.37 p.m.
Lord Wilson of Langside: My Lords, I imagine that there are currently one or two areas of public concern in relation to which it might reasonably be said that the Government's approach is wholly misguided and wrong. So far as the actual provisions of this Bill are concerned. it would not be quite appropriate to say that of the Government, but certainly the presentation of this measure to this House on a Friday afternoon is

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wholly misguided and wrong. I and my noble friends on these Benches share the sense of outrage which has been expressed by the noble Lord, Lord Bruce of Donington, on this matter.
I shall not attempt to express a similar sense of outrage in my own words because of the time, although I had intended to do so. The only reason why I speak now is because my noble friend Lord Taylor of Gryfe is not able to be here on a Friday afternoon. His expertise, particularly in the context of Part I of this Bill, is very great indeed.
I wish that the Government Chief Whip were here because I would then express the feelings I had when I saw what went on when he entered the House and looked repeatedly at the clock, and there were the exchanges, which those of your Lordships who were here witnessed, between himself and the noble Lord, Lord Bruce of Donington. I am not invariably on the side of the noble Lord, Lord Bruce of Donington, in all matters but on this occasion I cannot over-emphasise how much I shared his feelings. I know that my noble friend Lord Taylor of Gryfe felt that, and that was why he asked me—not the best qualified person to speak on these matters—to take part in the debate. I hope that Ministers will convey to their colleagues this feeling that we have.
These matters, in particular those dealt with in Part II, are of extreme importance to Scotland and to the other regions—Teeside, Sunderland, Tyneside, the North-West, Merseyside, and so on—because they have been the areas which have born the brunt of the recession. I find it positively offensive that against that background we should not have had an opportunity for a fuller debate nearer to the middle of the week. I referred to the presentation of this measure. The noble Lord, Lord Lucas of Chilworth, will appreciate that I was not referring to his extremely able, brief, clear and helpful presentation, but to the circumstances in which it comes before us.
I share also the feeling about the mix. This Bill is a bad mix. It is a thoroughly bad mix. I do not think it is right to refer to the matters dealt with in Part I and Part II as strange bedfellows. I think it was the noble Lord, Lord Grimond, who said that the two parts have aspects in common in the context of the present consequences of the years of recession during which this Government have been in power—and before that, too, because I appreciate that it started then. It is unhelpful to lump these two matters together. Our legislative system is such that it would have been much more sensible to have had two separate measures. That would have produced more fruitful debate. Do the Government not want fruitful debate? Do the Government not appreciate that they can be assisted in reaching more sensible solutions to the problems to which the Bill is directed if we have constructive, helpful and full debates? That particularly applies in this House, where so many of your Lordships have the kind of expert experience and knowledge which could promote solutions.
Having said that, we on these Benches welcome, with the kind of reservations expressed by the noble Lord, Lord Grimond, and others, Part I of the Bill. Some members elsewhere, and some here today, expressed doubts on the Government's enthusiasm for the possibilities of fruitful development in the context
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of the work of the CDA. Reference was made to the Mondragon experiment. My recollection—and I speak only from recollection and may be wrong—is that we had a debate in this House a year or two ago when a number of your Lordships and I expressed doubt about the Government's enthusiasm in this context. It is not surprising, because they have this curious ideological and dogmatic faith in the benevolence and the beneficence of market forces. One might call them "marketists". There is of course, as there always has been, a place for the market in human affairs, but there are other things as well. My feeling, as I remember saying at the time—this outraged some Members opposite—was that, in their approach to co-operatives in the light of the evidence of what had happened in Mondragon, they had a problem for every solution. That is, of course, not the way to get on with things.
I have only a few remarks to make about Part II of the Bill and I shall then sit down. It would. I imagine, be foolish to suggest that the working of regional policy in the past has not thrown up problems, including problems in my own part of the country, although there, as in Wales, there has been considerable success in creating jobs. The Government do not dispute that. The Government's approach to the problem in this Bill is not wholly without wisdom. What is open to doubt in this context, as in the other, is their willingness to pursue the new approach with enthusiasm. Is it sensible, we can ask ourselves, not to test the cost-effectiveness, which is what the Government have been doing, of the policies adopted up to now?
There is room for improvement, obviously, in the administration of the regional development grant system. One can understand the Government's concern that that system has been heavily weighted towards capital expenditure with too little regard for job creation. The same kind of question arises, and must arise, because of the Government's whole approach to the handling of the Bill and the relationship between Part II and Part I. It is clear from the financial memorandum, as the noble Lord, Lord Bruce of Donington, said, that the Government aim to cut substantially the money devoted to regional aid. There is no doubt about that. We on these Benches, and elsewhere I have no doubt, believe that this is not the time for cuts in this area. It will not do to pay lip service to the need for regional policy and then to reduce the resources necessary to pursue that policy effectively.
2.48 p.m.
Lord Graham of Edmonton: My Lords, I first wish to declare interests in this matter. I am a director of the Enfield and St. Albans Co-operative Society. I was sponsored as a Member of Parliament in another place by the co-operative movement. I continue my association with the co-operative movement and, of course, the Co-operative Party. It is a real pleasure to join once more the noble Lord, Lord Grimond who, I recall, has been in his place on every occasion when this matter has been dealt with since its inception in 1979 both in another place and here.
I also wish to associate myself with some of the dissatisfaction that has been expressed in what I consider have been five excellent speeches so far. The first excellent speech was that of the Minister himself,

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who gave a lucid explanation of the purposes of the Bill. I echo the words of colleagues in the House in saying that the noble Lord's speech was most helpful. When we look at the powers to dissolve, at the powers to intervene, and at financial matters, there is a great deal that we have to question. It would be churlish, however, if I did not echo the words of my noble friend Lady Nicol when she paid tribute to the fact that at least there appears to be a longer life for the development agency from 1984 on. The Minister can go a long way towards giving a categorical assurance not only that there is no intention to use the dissolution powers but that there is every indication that its life will be at least six years and beyond.
I wish to say how grateful we are that it appears to have a longer life. This has been achieved after persuading the hard-nosed businessmen—my collective view of those members of the Government who have rightly had to look at how they make public funds available—to take the decisions that appear in the Bill. They have done so in the light of a proven record based on a tiny amount of public money given to sustain co-operatives and the agency over the years.
It is right that my noble friend Lord Bruce of Donington should remind the House that there is a wider, well-established and successful co-operative movement, which, although sometimes in difficulties, will survive. Lord Bruce has paid tribute to the economic size of the co-operative movement and, in a debate of this kind, one cannot go into too much detail. However, I think one simply needs to put on the record the outstanding successful Co-operative Insurance Society, the Co-operative Bank, the Cooperative Milk Services and the like. Of course they are facing very great challenges to their ability to compete in the marketplace in future. Certainly the established co-operative movement takes a very keen interest in what one looks upon as the newly emerging and developing co-operative institutions about which we are talking at this particular time.
When one looks at the past five years in the history of co-operatives, worker co-operatives, copartnerships and the like, what it will show us is that it has been a time of burgeoning development in a range of matters. In my view, the 1980s will certainly be looked upon as the decade of the worker and the producer co-ops. Of course it is right for the House to be reminded, although we are looking forward for the next six years, of the raison d'eétre the development agency from its beginning.
For instance, I looked at a article which appeared in Your Business, on the 7th October 1983, talking about taking politics out of co-operatives. Without a political initiative—that is, without Labour and cooperative politicians (aided and abetted by politicians in other parties, let me add) having taken a keen interest in establishing the kind of mechansim that we have in the Co-operative Development Agency, we should not have had a development agency at all. So I do not think that we should too easily accept the sneering remarks about left-wing politicians, or even politicians at all, which appears in this article about the need to distance either the development agency or the co-operatives from the kind of image which some
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people say they have been getting in that particular way.
May I ask the Minister to take head-on the crippling nature of the funds which are available to the development agency? Would the Minister go through the following exercise? In 1978 it was seen that at 1978 prices £300,000 was needed and, in my view, it was well spent in establishing the agency. Now, six years later, the sum of money is £200,000. If at the end of a six-year life—if that is what we are talking about—with the normal rate of inflation, that £200,000 would need to be discounted by 37½ per cent. The Minister or the Box will tell him that there is a cushion. There is not merely six times £200,000 available; there is a little sum of money to play with which may be added from time to time. I wonder whether the Minister can say a little more about the willingness of the Government to make a little more money available from time to time if the CDA comes forward to them and says, "In this particular year, for these particular purposes, £200,000 is not going to be enough".
We also need to remind ourselves that in 1980 there were only 300 co-operatives of this kind. In 1984 there were 1,000. In 1980, 5,200 people found employment in them. In 1984, that figure has grown to 10,000.
I want to pay a well-deserved tribute to the chief officer, the chairman and the hoard of the development agency. The chief executive of the CDA is sitting not a thousand miles away from the Dispatch Box, listening very attentively to what undoubtedly is a most important matter to him. George Jones, the chief executive, has certainly brought a dynamism and an objectiveness into the future of the CDA which commends itself to a great many people. I notice that on the board are also Lewis Lee, who is the chief officer of the Co-operative Bank, and Bill Farrow, who is the chief officer of co-operative retail services. I am delighted to see that the board is a mix of those who have come from outside the established co-operative movement and those who at this moment, while serving the CDA, are also demonstrating that they are successful co-operative businessmen as well.
Could the Minister say something about the syndrome of secondment? The CDA exists and thrives on the basis that big companies like the Co-operative Bank, Unilever, and others, are seconding men of experience and ability in order to provide their time to the CDA. But if this was readily available at a time of recession, and if, as the Minister and the Government tell us, the economy is expanding and the bigger businesses will need these people back, how does the Minister see the CDA being able to produce and use people of that calibre, who are needed?
Also, could the Minister tell us a little more about how he sees the trading activities of the CDA being expanded? What kind of things does he envisage for the CDA? If it is a question of surveys and feasibility studies for the establishment of local CDAs, the Minister will know that there has been a time during the past six years when those kinds of services were needed. But I suspect that there will be a drying up. not only because they are already in-situ but also as more and more local authorities find that the bite is being applied by the Government in the provision of monies for that kind of work: that is, grants from central

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government. I should like the Minister to tell us more about what he envisages is going to be done in that field—the commercial activities of the CDA.
The CDA's annual report says, on page 20:
"The core sums of money needed to sustain an efficient CDA are relatively small. They should be provided by Government and, we maintain, increased".
The Minister knows that the monies are not being increased, and I wonder if he could say something helpful to the CDA.
I want to say a word or two about the crucial nature of training. Mention has been made of an expanding role. I wonder whether the Minister can take on board the facilities at the co-operative college at Loughborough. As we who have had experience in co-operatives know, there is a need to instil into handfuls of people who are keen but who are ignorant about co-operative methods, who are desperate to learn and to survive, skills, managerial expertise and experience. There is a world waiting to be opened up.
I notice in the report that some initiatives have been taken by the CDA. One talks about access to the "poly" of the South Bank; one talks about seminars. I would hope the Minister could tell us he intends to ask the CDA for a much more systematised programme indicating how we are going to transform people who are ignorant about managing a co-operative into competent people who can manage their small cooperative.
In my view, there is a desperate need for dynamic, vigorous leadership from central sources, especially in the sphere of firm guidance to unhappy workers, management and agencies with responsibility to promote and encourage co-operatives. Almost daily, one comes across illustrations of the need for groups of workers to receive better service if they are to turn their disaster of work collapse into work salvation. Let me illustrate that point.
Only yesterday I was told of the dispiriting experience of the workers at a firm called Synthetic Resins Limited at Speke on Merseyside. About two years ago their firm was in serious difficulties, in which management shortcomings played a significant part. When the well known and respected firm of Scott Bader took them over they saw it as a new lease of life. I understand that Scott Bader underwrote future losses to the extent of £1 million, but that recently the shop stewards were invited to produce a rescue plan and were given £10,000 to resource their researches. Earlier this month discussions were going on with management and the unions and USDAW played a prominent part. I am now told that the workforce received a bombshell yesterday—an announcement was made that the factory would cease production in June 1985. That is but a tiny tragedy in the vast depressing saga of unemployment statistics. But many of the workers have been made redundant before—not once, but twice and more. Desolation and depression about work prospects are deeper, longer held, and more real on Merseyside than in almost any other part of Britain.
In those circumstances, I ask: what can be done, especially in the context of a co-operative enterprise? I am told that there are prospects in this as in other comparable situations. New and vigorous
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management perhaps would help. Marketing, and advice, especially related to seeking and securing overseas markets for a new product, would help. The precise status of this factory and its workers is not fully known to me, but when we reflect that some 120 workers are affected—a not unusual size of enterprise in this situation—there is ample incentive to harness all resources. Can the Minister simply take this on board, reflect on how he can help, and appreciate the value of co-operatives in these circumstances?
Finally, I welcome the change communicated in another place by the announcement that before anything radical takes place about the future of the CDA there will be consultation with the established co-operative movement. I can tell the Minister that that announcement was received with great satisfaction and relief by the established co-operative movement—the Co-operative Union, the CWS, the CIS, the Co-operative Bank, and many others. I am optimistic about the future not only of co-operative enterprises, but of the CDA, and of course the future of the co-operative movement.
There is a great deal to be done, and in my view the opportunities which exists within this legislation will be turned to good purpose not only by the co-operative movement but by thousands of men and women who see co-operation as their salvation.
3.3 p.m.
Lord McIntosh of Haringey: My Lords. I am fortunate in following a number of excellent speakers on the first of these two Bills in that it relieves me of any responsibility of adding to the speeches, even if I were capable of doing so. I thought that my noble friends Lady Nicol and Lord Graham, and the noble Lord, Lord Grimond (in a very wise speech), covered this ground very adequately indeed. Therefore, this afternoon I want to concentrate on the second Bill which has been added—and it is my inclination to do so anyway because the sums of money involved have at least two and probably three noughts added on the end.
The importance of regional development and regional development grants to the economy of this country can hardly be under-estimated. The noble Lord, Lord Lucas, in his opening speech, made a very attractive case for the changes that were put forward. He presented them in terms—and very reasonable terms of improvements in the flexibility which the Government would have in making grants. For example, the areas covered by the legislation could now cover journey-to-work areas as well as local authority areas—indeed, any area that the Secretary of State chooses; that would be perfectly proper. The noble Lord pointed out that the restrictions which might have existed in previous legislations on the timing of projects had now been eased; and that, too, must be welcomed. The noble Lord talked about changes in the purposes for which grants might be made, and I shall come back to that matter in rather more detail in a moment.
The Bill also refers to the necessity for monitoring, which I believe is a valuable provision. The noble Lord made some reference to small businesses. He particularly reiterated the Bolton Committee definition of a

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small business as being 200 employees or fewer. That puzzled me, not because I do not understand what he means by 200 employees but because I cannot find any specific reference to small businesses anywhere, either in the clauses or in the schedules. In his reply perhaps the noble Lord would describe exactly what he means by small businesses and what this Bill is supposed to do for small businesses.
So far, so good: it sounds like a reasonable measure. It sounds as though we need not worry about it too much. But when we think about it a little more deeply we realise that there are very big questions here with which the noble Lord did not deal adequately in his opening speech. These are of two kinds. First, there is the question of what changes have been made from the 1978 legislation. That was never spelt out clearly and, of course, it is not spelt out in the Bill itself. One virtually has to carry out a line-by-line comparison in order to discover the changes. Secondly, I think that we are entitled to rather more explanation of the analysis which lies behind the proposal in the Bill that the emphasis should pass from capital grants to job-creating grants. It sounds all right in theory, but we ought to examine what it actually means in practice.
First, I want to ask a little more about the changes in legislation. The significant phrases in this legislation are "qualifying activities". "specified percentages" and "specified purposes". There are others, but those are perhaps the most important. The 1982 Act spelt out in Clause 3(2) what are "qualifying activities". I shall not detain your Lordships by reading out the list, but it sets out a long list of activities which qualify for regional development grant. I know that governments often say that to specify in legislation also means to exclude those activities which are not specified, and therefore they go for less specificity rather than more.
However, in this Bill we have gone the full circle, because "qualifying activities" are now proposed to be those which are specified by the Secretary of State. That is fair enough: that is the Secretary of State's responsibility. But then comes the doom-laden phrase "with the consent of the Treasury". This means that there is no assurance whatever that the kind of activities which were spelt out as being available for grant, and therefore spelt out to potential applicants for grant—because all these grants have to be applied for in the first instance. and people have to understand the legislation before they can take advantage of it—will be defined. There is no assurance whatever that there will be a clear definition of what are the qualifying activities: there is no assurance that it will be made obvious to potential applicants and no assurance that it will not be used as a restrictive measure rather than as a measure increasing the flexibility of legislation.
The "specified percentages" were spelt out in the 1982 Act. They are no longer spelt out. It is simply said that they may be variable. I may have a very nasty. suspicious mind, but my instinct is to think that, under those circumstances, if the Secretary of State is giving himself that freedom, he is giving himself the freedom to reduce the percentages rather than to increase them.
The most important of all—and in a minute I shall refer to why it is most important—is the phrase
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"specified purposes". Again, the 1982 Act was quite precise. It talked about providing a building or works on premises, and it talked about providing new machinery or plant. No such definition appears in this Bill. This Bill simply says that the specified purposes shall be (and I do not have the quote immediately to hand) what the Secretary of State wishes the specified purposes to be. The significance of that will be found in the Explanatory and Financial Memorandum. All of the increased flexibility, the improved wording of the Bill as put forward so—I shall not say plausibly—gently by the noble Lord, Lord Lucas, in his opening speech: all of these are opportunities for restriction rather than for an improvement in the conditions of grant.
What about the analysis under which these changes are made? The argument of the noble Lord, and I am quoting now from his speech, was:
"The principle problem of the assisted areas is unemployment".
He said:
"It is undesirable to shuttle jobs from one part of the country to another. Therefore, there would be an exclusion from automatic assistance for modernisation projects which do not create jobs".
That sounds all very well. There is not much that anybody could object to in that. It is certainly true that a problem of the assisted areas is unemployment. But surely it is the responsibility of the Government at least to try to analyse whether the unemployment is the symptom of a more serious defect in our economic policy or the cause of it, and whether the relief proposed in this legislation and the changes from the 1978 Act are not in fact an attempt to deal with the symptom in order to improve the unemployment figures which destroy the credibility of the economic policy of this Government, or whether they are really an attempt seriously to deal with the cause of unemployment?
I am surprised that a Government which so proudly proclaim their adherence to the market economy should fall so readily for the Marxist labour theory of value as to think that they are dealing in this way with the real problems of our economy. It is not just a question of the more general economic analysis. It is not just a question of whether you can create jobs by counting the number of jobs created as opposed to the effectiveness over a long term of capital. It is also a question of whether this is going to lead to grants which are going to be permanent.
The Minister referred to long-term and secure jobs. Fair enough. But the problem with grants which are given on the basis of the number of jobs is that those jobs can disappear very readily when the grant expires, and there is no inhibition among those who have applied for grants and have been given the grants against simply packing up their tents and leaving when the grant is finished.
That is a quite different situation from grants for premises and capital expenditure and plant and machinery. That plant and machinery and those premises continue to provide value for our country and for our economy even when the original grants have expired. It requires a little more rigorous analysis of the economic issues involved from the Government if we are to answer that question. Are we dealing with the symptoms of distress, of economic problems in our

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assisted areas, or are we really dealing with the causes? I suspect it is the former.
I have talked about this in fairly neutral terms so far, but my suspicious mind then leads me to look back at the Explanatory and Financial Memorandum and to wonder why, looking there, these measures are proposed. When we come to Part II on the financial efforts of the Bill we clearly see the reason for it.
"The eventual financial effect of the Bill cannot be specified at this stage."
Perhaps the noble Lord, Lord Lucas, can help us a bit more on that in his closing speech, because we are entitled to more explanation than that.
"However the exclusion from grant of expenditure not relating to projects undertaken for the specified purposes, and the intended policy requirement for projects normally to increase jobs"—
note that: it is actually stated here that the additional requirement that projects should increase jobs is a contributory factor—
"are together likely to lead to a significant reduction in planned expenditure on RDG…expenditure on RDG might be reduced by some £150–£200 million in a full year. This may be offset to some extent by an increase intake up of selective financial assistance under section 7 of the 1982 Act".
That reduction in expenditure is the kernel of this Bill. That is what the Bill is about. It is not about any highflown conversion to job creation. It is not about any conversion to the argument which the Opposition parties have been putting all these years that the Government are guilty, above all, on their unemployment figures. There is no conversion there. What the Government propose to do with this Bill is to reduce expenditure on regional grants. They propose to do so despite the fact that, if anything—as my noble friend Lord Bruce said in his opening remarks—the original criteria for regional grants ought now to be extended to the whole country. There is no part of this country which does not have higher unemployment than the worst areas had when the Act was first introduced.
This part of the Bill, this second Bill, is presented in such a way as to conceal rather than to explain its real purpose. Its real purpose is extremely dangerous and I believe it is the duty of your Lordships to attack the reduction in expenditure and to demand that this Bill be reframed to continue the very necessary regional grants which ought to be a cornerstone of the economic policy of this Government.
3.15 p.m.
Lord Lucas of Chilworth: My Lords, the noble Lord, Lord Bruce of Donington, spent seven minutes of his speech describing how he did not like what I might call the domestic and other arrangements with regard to our business this afternoon. He will accept that this is not within my province of responsibility, but he will also accept that it is within the province of his noble friend who forms part of the usual channels. I do not feel that his accusation was totally accurately directed when he asked me to draw my noble friend's attention to it. He suggested in a reference to yesterday's business that your Lordships House should not be taken for granted—nor indeed would we. I can certainly assure the noble Lord that I would never take him for granted.
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The noble Lord spoke about my noble friends Lord Cockfield and Lord Belstead. How we on the Front Bench apportion our responsibilities. I am sure he would accept, is our responsibility. Your Lordships have before you the latest recruit, unlisted in the Grey Book. I apologise. but I hope that I will not let the noble Lord, Lord Bruce, down regarding the very kind remarks that he made.
I believe that throughout the general debate we have had, with one or two notable exceptions, there has appeared to be a general suspicion of the Government's intention. I am sorry, because I would be a little inclined to say—particularly in respect of the noble Lord, Lord McIntosh of Haringey, who wound up—that I would not have thought that noble Lords had such suspicious minds. I made the position quite clear. He said—I want to dispose of this right away—that hidden behind all this was an intention to reduce expenditure. No: what there is hidden behind this measure—I will come back to the Explanatory and Financial Memorandum in a moment—is a parallel measure. I cannot accept that we are talking about two Bills. We are talking about two parts of one measure. What lies behind it is a better utilisation of those funds which are available for regional development grant and for the Co-operative Development Agency. That, I think, noble Lords should have firmly in their minds as we come to discuss the Bill in later stages.
The noble Lord, Lord Bruce of Donington, asked me to reply specifically to questions. He did not want the pat, pre-written yesterday or this morning, winding-up speech. Well, he will not get that; but, if your Lordships will forgive me, it will obviously take me a longer time to answer all these questions. I do not mind at all. I really do not mind. If my speech, therefore, is a series of disconnected jottings, it is in response to his invitation. I would apologise, therefore, for not being able to string them all together. Let us have a look at some of the points about which the noble Lord, Lord Bruce, asked me.
He asked why we have chosen this moment in time, a Friday afternoon, at that, to bring forward this legislation. The reason is—and he really knows it—a very simple one. We have to ensure that we have an effective use of taxpayers' money and we must have that before August, for that is when the money runs out. That is why we have to have this legislation. I explained that when I opened the debate; so there is no great mystery about it.
The noble Lod specifically mentioned consultation with the co-operative movement, as did other noble Lords. It was first introduced, as he suggested, in another place at the direct request of the co-operative movement. It met the Opposition's concern with regard to consultation, particularly prior to any decision to wind up the agency. I do not know how much further noble Lords would expect me to go this afternoon, or when we reach Committee stage. We have met the requirement of the Opposition in this matter, and I would doubt whether we could go very much further.
When I was opening this debate I did not say that the cost of every job was £300,000. What I said was that grant in some cases amounted to that kind of figure and that it was an excessive amount. That is why

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the formula is changed. Let me emphasise again that, whether we go for the capital sum or for a job grant, any applicant will derive the greater benefit and, in the case of small firms, they will be excluded from that and therefore will not have to do any of the involved calculations to determine which is the better grant to go for. The noble Lord, Lord Bruce of Donington, went to some lengths to remind your Lordships of what Deloitte Haskins and Sells themselves had had to say. Of course, they are a very well respected company of chartered accountants known to all of us, but they were among the 500-odd bodies and individuals who took up the Government's invitation for views on a wide range of issues in the White Paper, and the results of all those consultations are under consideration now. Certainly the Bill before us this afternoon does not prejudge any of those considerations.
The noble Lord also asked me why we did not publish evidence with the White Paper. I do not know whether the noble Lord was pulling my leg. He knows very well that we did publish it, in a massive, great volume—he knows it. I have a copy on the Bench beside me. and he has a copy in his office. I think perhaps he was enjoying a little pre-weekend fun. He asked—and this was really very fair, and was perhaps one of the clearest question he asked me—what did I mean by a "genuine job". What I mean, and what the Government mean, are about the same thing. We believe, within the context in which I was speaking this afternoon, that a secure and genuine job is one which is both profitable and productive; that is, profitable to the individual and profitable to the organisation which he serves—and profit is not only in monetary terms. Yes, it is productive, because it creates wealth for the country. The noble Lord spoke about nursing and, of course. that is a genuine job; he knows that, too.
But if we have in mind the kind of job that relies on Government subsidy, whether it comes from the taxpayer or the ratepayer—and noble Lords will know that we have been discussing this kind of question for many weeks now in your Lordships' House—that cannot be a genuine job.
Lord Bruce of Donington: My Lords, if the noble Lord will permit me, may I ask whether he would consider the large-scale farmer who is receiving continuous aid from the Government, amounting to thousands of pounds a year in many cases, to be someone in a genuine job!
Lord Lucas of Chilworth: My Lords, considering that the farming community provide a very large amount of the foodstuffs that we consume in this country, I should have thought it was a very genuine job. I should not wish to debate this afternoon the amount of subsidy. Indeed, it was the noble Lord, Lord Grimond, who raised the question of the relativity of CDA funding to agricultural grant—a subject which perhaps I might be able to come to a little later.
I want to deal with one more principal question about which noble Lord, Lord Bruce of Donington spoke; namely, the winding up of the agency. In all legislation to do with non-statutory bodies there has been provision for their winding up, for whatever
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reason. There is no hidden significance in this and the provision in this Bill merely brings the CDA into line with what is common practice in regard to other non-statutory bodies.
I turn to the noble Lord, Lord Grimond, whose speech, if I may say so, I found somewhat warmer than that of the noble Lord, Lord Bruce of Donington. He made a number of points. I am quite sure he will forgive me if I do not take up all of them this afternoon. But he asked me quite specifically about training. Perhaps it would be helpful if I told him that in the other place there was a lot of pressure to widen the training power, so that the agency could provide training courses not only for members of cooperatives, or prospective members, but also for any other persons who were not necessarily involved in a co-operative movement. The thinking behind this concerned the need of professional people, such as solicitors, accountants, careers officers, and others, to understand the nature of co-operatives. We felt that the agency had a role to play in this respect. I beleive that that was the noble Lord's main point.
He asked me specifically why there was more money available for agricultural co-operatives than for the industrial co-operatives the CDA. The only thing I can tell him this afternoon is that MAFF runs a particular grant scheme for agricultural co-operatives, and that will amount to about £4 million in this financial year. It was designed particularly to improve marketing skills. There are 575 agricultural co-operatives, and their turnover in 1981–82, which is the last year for which I have figures available, was about £2,163 million. It was considered, because of that scale, that a different treatment was justified.
I was grateful to the noble Baroness, Lady Nicol, because she finished her very interesting speech by giving a qualified welcome to the Bill. She asked specifically: why was the funding fixed at £200,000. Could it not be more? Several other speakers raised that point also. Perhaps I might repeat exactly what I said in opening the debate:
"Noble Lords will note that on the basis of funding at £200,000 a year for six years, an extra £300.000 has been allowed for in the Bill. This is to give the Government flexibility in any future decisions on the funding levels and time scales."
I do not really think I can go further than that in response to the noble Baroness: nor indeed in response to the noble Lord, Lord Graham of Edmonton, who raised much the same point.
I am sorry the noble Baroness feels that she will have to seek to remove Clause 3 when we come to it. I have given an answer. If she still feels that it is inadequate I shall be very happy to discuss this with her, because she has given specific warning that this will be her intention. We of course shall resist it: I can say that.
The noble Lord, Lord Wilson of Langside, told us that he was deputising for his noble friend Lord Taylor of Gryfe. The noble Lord. Lord Taylor, told me that he would not be able to be here this afternoon; but I am sure that noble Lord, Lord Wilson, was speaking on his own behalf as well. Again, I am rather sorry that he should feel that there is some sinister motive, as other noble Lords suggested, in having the Second Reading of this important Bill on a Friday. There is nothing sinister: it is a necessity to get on with the business and has nothing with quotas of time. I have

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sought to explain that if noble Lords on those Benches—
Lord Wilson of Langside: My Lords, I am grateful to the noble Lord for giving way. If I suggested there was something sinister in it, then I misled myself as well as the Minister. What I was suggesting was that it showed a wrong sense of priorities.
Lord Lucas of Chilworth: My Lords, I am grateful to the noble Lord for that assurance and if I misunderstood him I am sure he will forgive me also. He asked—as did the noble Lords, Lord McIntosh, Lord Graham and Lord Bruce of Donington—where the savings are that we are talking about. The savings indicated in the Explanatory Memorandum arise primarily from the exclusion of the replacement investment grant. This is required by the European Commission, and in fact we are quite happy to comply with the Commission's ruling. This is not for the reasons which some noble Lords may suspect; but, frankly, we have belief that support for replacement investment is usually dead weight, in that that investment will be going ahead anyway, probably in the same place, even without grant, and the money could be better used elsewhere.
As the Explanatory and Financial Memorandum makes clear, if the present grant system and the map remain unaltered, we estimate that expenditure might be reduced by £150 million to £200 million in a full year. The exclusion of nonjob-creating modernisation grants, except normally in the case of small firms, will account for some £105 million of this saving, while the exclusion of replacement investment will account for about £70 million.
I was most grateful to the noble Lord, Lord Graham, because I found that his understanding of the whole of the co-operative business, which we acknowledge, gave him a rather different view of what we are trying to do. Of course, he had some reservations, but his speech this afternoon was very warm and very encouraging, particularly to the CDA. He asked a number of questions and I think that I have dealt with the one with regard to funding. He also asked me about secondments. The record of private sector secondments in the past has been excellent, as he knows, and we can see no reason why that record should not be sustained. Certainly, Ministers will continue to encourage secondments and we believe that firms will do so, also. It is part of their success. I have dealt with the dissolving of the agency. The noble Lord asked me particularly about—
Lord Graham of Edmonton: My Lords, I am most anxious about the question of getting to grips with the need for a relevant course of training for small groups of people. I gave an illustration not of a disaster, but of a potential disaster perhaps arising out of inexpertness in understanding what is required. I was talking about using the Co-operative College, but in other ways. Does the CDA have a proper programme for widening the number of courses and the number of people who will be trained to be sound co-operators?
Lord Lucas of Chilworth: My Lords, I appreciate what the noble Lord has said. I am sorry that I did not pick up the point properly before. This is something that I knew about some years ago when I was dealing in particular with small firms. My understanding is that the CDA and the MSC have put together a new package of training. The provisions in the Bill with regard to training will allow them to expand that activity for precisely the reason which the noble Lord gave. We have seen in recent years well-meaning, well principled people joining together in co-operatives, and two or three years later they have had to be abandoned because there was not the skill, the expertise or the knowledge. The CDA will be looking at this, in particular, and that is why that extension is in the Bill for giving assistance in that way. I take the noble Lord's points on board. I am sure that there are a number of points—some of which are rather more major than others—which I have not picked up. If I have failed to reply to any of the points which have been made, I can assure noble Lords that before we reach the next stage I shall respond.
Now let me turn to the speech of the noble Lord, Lord McIntosh of Haringey. He will forgive me if I say that I was just a little disappointed that he took the same kind of stance as was taken by the noble Lord, Lord Bruce of Donington. I have said before that there is nothing sinister about the Bill. It is an attempt—we shall see in the fulness of time whether it is a good or a bad attempt—to improve the way in which we deal with regional disparities. It is wrong to suggest that the Government are abandoning their real responsibilities. I do not intend to give a wide-ranging response to the point which the noble Lord, Lord Bruce of Donington, attempted to make when he discussed unemployment in more general terms, because that is not, I believe, the purpose of the Bill. We maintain that the Bill now before your Lordships will benefit those regional areas which need assistance. We prefer to give help where jobs have been created. That is the basic purpose of the Bill.
The noble Lord, Lord McIntosh of Haringey, asked a number of questions and, in accordance with my undertaking, I shall try to answer as many of them as I can. The noble Lord asked about qualifying activities. I can assure the noble Lord that the qualifying activities will be quite clearly defined by order. Any activity which currently qualifies will continue so to do. The noble Lord mentioned the consent of the Treasury. I would remind him that the consent of the Treasury is already required under the existing Act. There is, therefore, no mystery about it.
The noble Lord also asked me about the specified purposes. These are contained in the new Section 3(1) in Schedule 1, which is to be found on page 8 of the Bill. Under the Bill, grant is payable in respect of the provision either of assets, as now, or of jobs. That is set out in the new Section 2 on page 7. Grant rates will be specified by order, all the consultations and decisions having been taken. That would, we hope, take a matter of months only. Both the noble Lord, Lord McIntosh of Haringey, and the noble Lord, Lord Graham of Edmonton, asked about small firms. There is no mystery about Bolton. I believe that the noble Lord, Lord McIntosh of Haringey, asked why a number is not included in the Bill. If I said that the number was

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200 or 201, the noble Lord would probably ask whether it could be 150 or 300. Probably the general definition of a small firm is one which employs fewer than 200 people. We would go along with that figure.
Lord McIntosh of Haringey: My Lords, I was not saying that the Bill should contain a definition of a small firm. It may be entirely my own incompetence, but I cannot find in the Bill any reference to concessions to small firms, of whatever size.
Lord Lucas of Chilworth: My Lords, I shall attempt to find something with which to satisfy the noble Lord before he puts down a probing amendment for our Committee stage on 11 th July. I want to make only one other point. Even if the noble Lord, Lord Bruce of Donington, twits me that this is the prepared piece—yes, it is; I shall tell him that. But I have not given him the speech, and he knows that also. Most people have accepted the CDA provision in Part I of the Bill, and I am grateful to them for that. Perhaps it is the more straightforward part of the Bill but it is a no less important part for that.
The regional provisions of the Bill represent—and I have tried to illustrate this when answering questions—a sensible and practical way of tailoring regional policy to meet more effectively the challenge we now face. The Government believe that a new scheme will have a significant impact in encouraging the creation of jobs where they are needed, and it will provide a cost-effective way of helping the most disadvantaged areas of the country. As I have said, the Bill also recognises the importance of the Co-operative Development Agency. With those very few concluding remarks, I would ask your Lordships to give this Bill a Second Reading.
On Question, Bill read a second time, and committed to a Committee of the Whole House.
House adjourned at fourteen minutes before four o'clock.