Lords Sitting of 19 November 1985

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

Message from the Queen
The Earl of Airlie: My Lords, I have the honour to present to your Lordships a Message from Her Majesty the Queen, signed by her own hand. The Message is as follows:
"I have received with great satisfaction the loyal and dutiful expression of your thanks for the Speech with which I opened the present Session of Parliament".

Water Cannon and Public Disorder
Lord Inglewood: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government how many German water cannon have been brought into this country over recent years; what training has been carried out in co-operation with a German police team; and what are their plans for the use of water cannon in areas where there is risk of major disorder.
The Parliamentary Under-Secretary of State, Home Office (Lord Glenarthur): My Lords, two water cannon were borrowed for six months in 1982 from West Germany for examination by Home Office scientists and the police. Four West German police officers came to London for a fortnight to familiarise operators with the use of the machines. Two prototype vehicles have since been built in this country under contracts awarded by the Home Office. We are considering, particularly in the light of the recent riots, whether they have a role to play in dealing with public disorder.
Lord Inglewood: My Lords, that is a very satisfactory first reply to this Question. However, considering the controversy which there is bound to be and the fact that there cannot be very many of us who have had experience of these water cannon, would it not be good if a party were organised of Members of this House who were interested to go to Hendon, or wherever it may be, to learn how effective they are?
Lord Glenarthur: My Lords, I think the important point is that the examination of these machines by those who are looking at them takes place fully first. I do not think I can really commit myself here at this Box to any visits by my noble friend or any others at this stage.
Lord Elwyn-Jones: My Lords, can the noble Lord give us further and better particulars of these German water cannon? What qualities have they that British
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water cannon, if any, do not possess? Is there some special attraction of the German police which is now coming forward with approval in the Home Office?
Lord Glenarthur: My Lords, it is true that in years past we had our own water cannon, and they were used in the early 'seventies in Northern Ireland, as the noble and learned Lord will remember. We have not used them at all regularly since then, but the Germans and other nations have. It was important that we looked at current ranges of vehicles.
Lord Hunt: My Lords, is the noble Lord aware that I and, I feel sure, other noble Lords are relieved to know that the Government are proceeding with great caution in this matter? Is the noble Lord also aware that there are grave objections to using water cannon in the narrow streets of our inner cities, as distinct from open spaces? Is he further aware that, to my knowledge, the only water cannon used by the RUC in Northern Ireland in the late 1960s were not used later for that very reason, and, as far as I know, have been scrapped?
Lord Glenarthur: My Lords, the noble Lord is quite right, there are difficulties in their deployment in narrow streets, with parked cars and that sort of thing. However, I am sure that the most important matter is to prevent the situation arising where this kind of measure is necessary in the first place.
Lord Renton: My Lords, bearing in mind that fires have been one of the major features of the riots in our inner cities, is there any hope that the use of water cannon might have the double purpose of suppressing riots and also minimising the amount of fire-raising that is carried out?
Lord Glenarthur: My Lords, I think the major difficulty is that water cannon do not carry the necessary quantity of water with them to suppress fires in the way that my noble friend would like.
Lord Bruce of Donington: My Lords, further to the question put to him by his noble friend, will the noble Lord bear in mind that well-fed, well-clothed and well-housed people tend not to riot?
Lord Glenarthur: My Lords, the fact is that we have been faced with riots. As I said just now in answer to the noble Lord, Lord Hunt, it is important that we make every effort to prevent the kind of situation occurring in which in any sense it might be necessary to use measures of the kind for which water cannon were designed.
Lord Carver: My Lords, will the noble Lord the Minister not agree that it is preferable to give the police the option of squirting people with water rather than be forced to use CS gas or fire plastic bullets at them?
Lord Glenarthur: My Lords, yes, I think the noble and gallant Lord is right in saying that one can think of a scenario in which drenching with water would be preferable to the use of either CS gas or plastic bullets. However, I still stand by what I said: that it is important that the situation should not arise at all.

Employment of Graduates
2.42 p.m.
Lord Sandys: My Lords, on behalf of my noble friend Lord Orr-Ewing, and with his consent, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what are the latest figures for graduate employment and what further actions they propose.
The Earl of Swinton: My Lords, in 1984 there were 97,900 graduates from full-time and sandwich first degree courses in universities and polytechnics. That is 18 per cent. more than in 1979. Of the 1984 graduates, 10 per cent. were unemployed six months later, which is the lowest proportion since 1980. The Green Paper published last May emphasised the need for higher education to take greater account of the needs of industry and commerce. The Government will continue to pursue policies to that end.
Lord Sandys: My Lords, I thank my noble friend for that reply. Can he tell the House whether a larger proportion of graduates are now going into industry than hitherto?
The Earl of Swinton: My Lords, in 1984 there were nearly 7,000 more graduates in science and engineering than in 1979—an increase of about a quarter. However, industry has indicated that it still needs more, particularly in electronic engineering and computing.
Lord McIntosh of Haringey: My Lords, while I welcome the Minister's statement of a decrease in graduate unemployment, may I ask him whether he would accept that there are two possible explanations of that, one that there are genuinely more jobs for graduates and the other that there have been excessive cuts in the provision of university education?
The Earl of Swinton: My Lords, perhaps I may begin by welcoming the noble Lord, Lord McIntosh of Haringey, as the Opposition spokesman on education and science in this House, and wish him all the luck. There has not been a cut in higher education, as the noble Lord suggests. In fact, since 1979 the number of home students has increased by more than 65,000. The proportion of 18- to 19-year-olds entering higher education has increased by a tenth, and the number of mature entrants has increased by a sixth. Our plans envisage further increases in opportunities to enter higher education over the next decade.
Lord Nugent of Guildford: My Lords, is my noble friend aware that while the cut has not occurred in these technological faculties it has occurred in the arts faculties which usually accompany the technological faculties, and that it is impossible to have a good university with a balanced education unless one has both? Will my noble friend be good enough to look at that particular aspect?
The Earl of Swinton: My Lords, I do not often disagree with my noble friend Lord Nugent, but on this point I think I must because at present 47 per cent. of university students and 60 per cent. of those in the public sector are not on science-related courses, so I think that there is scope for change. But my noble friend is quite right in saying that arts and humanities courses are also important. As my right honourable friend the Secretary of State has made clear, rigorously taught, such courses develop analytical and critical skills of broad vocational relevance and help transmit and enrich our cultural heritage.
Lord Avebury: My Lords, with regard to the shortage of graduates in computing, is the noble Earl aware that most of the demands are from people with several years' relevant experience and there is still a need to encourage employers to take people straight out of the universities, as do some sectors such as the banks and local authorities, and give them the necessary background; and the more the Government can do to encourage the rest of industry to follow the example of these more enlightened employers. the sooner we shall reach the end of the shortage of qualified manpower?
The Earl of Swinton: My Lords, I think that in answering the last supplementary question I said that I did not very often disagree with my noble friend. I do not very often agree with the noble Lord opposite but I do so on this occasion.
Lord Mowbray and Stourton: My Lords, does my noble friend have the figures of the proportion of graduates in employment who have gone into manufacturing industry?
The Earl of Swinton: My Lords, I think that my noble friend will have to wait because detailed statistics on graduates' subjects of study and on their employment destination are going to be published, together with other related figures, in a Department of Education and Science statistical bulletin in late December or early January. If my noble friend will wait patiently until then, he will get all the figures.
Baroness Seear: My Lords, now that the number of graduates has gone up, when are the Government proposing to increase the resources to back the numbers—particularly in those technological universities such as Salford and Ashton which have suffered severe cuts?
The Earl of Swinton: My Lords, our expenditure plans envisage small cash increases in grants to universities in the next few years. The effect in real terms will depend upon the rate of inflation, but a reasonable expectation might be that universities will need to make savings of just over 1 per cent. in each of the next two years and of rather less in 1988–89. We believe that these savings can be achieved through increases in efficiency so as to offer the taxpayer even better value for money.
Baroness White: My Lords, can the noble Earl explain how that squares with the advice the universities have received from the University Grants Committee that they must face cuts of 2 per cent. per annum for an indefinite period?
The Earl of Swinton: My Lords, I think we are getting rather wide of the Question, which is about the employment of graduates.
Baroness White: My Lords, since it is very much at the root of the questions to which the noble Earl has been good enough to give some replies, I think he should reply to that one, too.
The Earl of Swinton: My Lords, I gave my answer and I stand by it.

Export Credits: Consultation
2.47 p.m.
Lord Bruce of Donington: 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 consultations have taken place with export houses since their published decision to phase out the ECGD's comprehensive bankers' guarantee scheme, and with what result.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Lucas of Chilworth): My Lords, before the Government's decision was announced, consultation took place with all users of the ECGD scheme referred to, including export houses, and the views then expressed were taken into account. No further consultations with export houses have taken place since the decision was announced.
Lord Bruce of Donington: My Lords, can the noble Lord inform the House on what consultations took place between his department and the noble Lord, Lord Young of Graffham, before the phasing out of this particular part of the ECGD's scheme was announced? Is he aware that the withdrawal of this scheme will have a particular impact on small and medium sized businesses, and in particular on their cash flow? Will he say whether satisfactory agreements have been arrived at with the export houses and the banks in order to ensure that satisfactory facilities will be given, particularly to small and medium sized exporting firms, so that their progress may continue?
Lord Lucas of Chilworth: My Lords, the fact of the matter is that a reducing number of exporters have taken advantage of the scheme. In 1981, for example, 1,770 were using the facilities. The current figure is down to 725. In addition, the service is losing money. As a result of the consultations which took place earlier this year we were satisfied that there was an availability of finance through the normal banking channels to satisfy the needs of small and other exporters.
Lord Bruce of Donington: My Lords, is the noble Lord aware that one of the reasons why the number of
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firms using these facilities has declined is that the policies of the Government have decimated the numbers that are able to participate in these particular schemes? Will he give an undertaking that before proceeding further consultations will take place with his noble friend Lord Young of Graffham with a view to ensuring, even at this late stage, that the facilities are restored?
Lord Lucas of Chilworth: My Lords, the policies of Her Majesty's Government have improved our exporting performance quite considerably over a number of years. Secondly, I can give the noble Lord opposite the assurance that any matters concerning industry, and particularly exporting, are discussed with all relevant Ministers.
Lord Diamond: My Lords, is the noble Lord satisfied that the best way of dealing with a loss being made by a service is to cancel the service completely—especially when it is obviously still of considerable use to some exporters?
Lord Lucas of Chilworth: My Lords, my honourable friend the Minister of Trade and Industry announced on 24th October this year the finishing of this particular facility concerning the ECGD; but it will not finish completely for two years, so enabling exporters to make alternative arrangements, which, as I have already said, the banking channels are ready and able to deal with.

Drug Trafficking: UN Convention
2.52 p.m.
Lord Rodney: 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 there are any proposals to draw up a new United Nations convention to counter drug trafficking.
Lord Glenarthur: Yes, my Lords. A proposal for a new convention to deal with drug trafficking was brought forward by the Venezuelan Government at the United Nations General Assembly last year. Her Majesty's Government firmly support this proposal. Our suggestions and comments on the elements that such a convention might contain were placed in the Library on 3rd July.
Lord Rodney: My Lords, I thank my noble friend for that encouraging Answer. Can he say whether, among these suggestions, any provision was made for the possible extradition of traffickers in drugs?
Lord Glenarthur: My Lords, this is one of the aspects which is considered, and of course my noble friend will see that it is more fully set out in the paper.
Lord Elystan-Morgan: My Lords, I welcome what the Minister has said on that matter. Does he agree that equally important as the new convention is the question of practical working relations day by day with

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those countries from which the drugs come, particularly narcotic drugs? Can he assure the House that Her Majesty's Government are making every necessary effort in this field?
Lord Glenarthur: Yes, my Lords, I can give the noble Lord that assurance. No doubt he will be aware that my honourable friend the Parliamentary Under-Secretary recently visited Pakistan, and there he was able to announce the provision of further United Kingdom financial assistance with crop substitution and rural development projects and also for law enforcement measures in that country. It is right that all countries should be involved, and that is what we are doing our best to encourage.
Baroness Masham of Ilton: My Lords, is the Minister aware that many countries within the United Nations convention derive great income from drug trafficking and that it may not be in their interests to try to stop this? Is there any way that those countries can be penalised?
Lord Glenarthur: My Lords, I believe that question was really answered by my Answer just now. My honourable friend made that announcement of an extra £2.4 million to Pakistan for precisely what the noble Baroness seeks—crop substitution. That is one of the ways in which this problem can be tackled.

Anglo-Irish Agreement
2.54 p.m.
Lord Denham: My Lords, your Lordships will know that my right honourable friend the Prime Minister made a Statement in another place yesterday on the Anglo-Irish Agreement. A full debate is being arranged through the usual channels and is likely to take place next week. It has therefore been agreed through the usual channels that the Statement should not be repeated orally this afternoon, but with the leave of the House I will arrange for its text to be printed in the Official Report.
Following is the Statement referred to:
"With permission, Mr. Speaker, I should like to make a Statement about the meeting which I attended with the Taoiseach on 15th November. I was accompanied by my right honourable and learned friend the Secretary of State for Foreign and Commonwealth Affairs and my right honourable friend the Secretary of State for Northern Ireland. Dr. FitzGerald was accompanied by Mr. Spring, the Tanaiste, and by Mr. Barry, the Irish Minister for Foreign Affairs.
"An agreement was signed between our two Governments, which has been published in a Command Paper. The text of the communiqué, issued after the meeting, is also included in the Command Paper.
"The purpose of the agreement is to promote peace and stability in Northern Ireland; to encourage reconciliation between the two
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communities there; to create an improved climate of friendship and co-operation between the United Kingdom and the Republic of Ireland; and to strengthen cross-border co-operation between the two countries, particularly in combating terrorism.
"The agreement will not come into force until it has been approved by Parliament and by the Irish Dail. The House will have an early opportunity for a full debate.
"The agreement has two principal features. The Irish Government have affirmed in a binding international agreement that the status of Northern Ireland will remain unchanged so long as that is the wish of the majority of its people. They have also recognised that the present wish of a majority is to remain part of the United Kingdom. This is the most formal commitment to the principle of consent mady by any Irish Government.
"The second main feature of the agreement is the establishment of an intergovernmental conference within the framework of the existing Anglo-Irish Intergovernmental Council. The conference will be serviced by a secretariat on a continuing basis In this conference the Irish Government may put forward views and proposals on certain aspects of Northern Ireland affairs.
"If devolution is restored—both Governments are committed to support this—then those matters which become the responsibility of the devolved Government will be taken out of the hands of the intergovernmental conference. The conference will also discuss cross-border co-operation, including improved security co-operation.
"The two Governments have agreed to make determined efforts to resolve any differences that may arise, but the conference will not be a decisionmaking body. Full responsibility for the decisions and administration of government will remain with the United Kingdom Government north of the border and with the Irish Government south of the border.
"The first meeting of the intergovernmental conference will take place as soon as practicable after the agreement comes into force. Particular subjects on which the conference will concentrate at its initial meetings are: ways of improving relations between the security forces and the minority community in Northern Ireland; action to improve security co-operation between our two Governments; ways to help underline the importance of public confidence in the administration of justice.
"The agreement recognises that it would be for parliamentary decision in Westminster and Dublin whether to establish an Anglo-Irish parliamentary body of the kind described in the Anglo-Irish studies report of November 1981.
"The Irish Government have announced in the communiqué their intention to accede as soon as possible to the European convention on the suppression of terrorism. We welcome this.
"No single agreement can resolve the deep-rooted and complex problems of Northern Ireland and deliver the peace for which the great majority of

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people in Northern Ireland long, but I believe that the present agreement will make an important contribution. It maintains and confirms the status of Northern Ireland as part of the United Kingdom and recognises the legitimacy of the Unionist position. It provides for co-operation in the intergovernmental conference to be a two-way street.
"We shall wish to pursue matters affecting the Republic in the interests of the people of Northern Ireland—for instance, improved security and economic co-operation. It encourages the political parties in Northern Ireland to reach agreement on an acceptable form of devolved government. It offers hope to all those in both communities who want to defeat the men of violence and to work together peacefully for a better future for their children. That is the purpose of the agreement. It is in that spirit that I commend it to the House."

European Communities Committee
2.55 p.m.
The Chairman of Committees (Lord Aberdare): My Lords, I beg to move the first Motion standing in my name on the Order Paper.
Moved, That a Select Committee be appointed to consider Community proposals, whether in draft or otherwise, to obtain all necessary information about them, and to make reports on those which, in the opinion of the Committee, raise important questions of policy or principle, and on other questions to which the Committee consider that the special attention of the House should be drawn;
That, as proposed by the Committee of Selection, the Lords following be named of the Committee:—

Attlee, E.

Nathan, L.

Bancroft, L.

Nugent of Guildford, L.

Brookeborough, V.

Oram, L.

Broxbourne, L.

Robson of Kiddington, B.

Camegy of Lour, B.

Rochdale, V.

Gallacher, L.

Rochester, L.

Harris of Greenwich, L.

Rodney, L.

John-Mackie, L.

Seebohm, L.

Kearton, L.

Serota, B.

Llewelyn-Davies of Hastoe, B. (Chairman)

Shannon, E.

Sidmouth, V.

MacLehose of Beoch, L.

Templeman, L.

Middleton, L.

Torrington, V.

That the Committee have power to appoint Sub-Committees and to refer to such Sub-Committees any of the matters within the terms of reference of the Committee; that the Committee have power to appoint the Chairmen of Sub-Committees, but that such Sub-Committees have power to appoint their own Chairman for the purpose of particular enquiries; that two be the quorum of such Sub-Committees;
That the Committee have power to co-opt any Lord for the purpose of serving on a Sub-Committee;
That the Committee and any Sub-Committees have power to adjourn from place to place;
That the Committee have power to appoint specialist advisers;
That the Committee have leave to report from time to time;
That the Reports of the Select Committee from time to time shall be printed, notwithstanding any adjournment of the House;
That the Minutes of Evidence taken before the Committee or any Sub-Committee from time to time shall, if the Committee think fit, be printed and delivered out;
That the Committee or any Sub-Committee appointed by them have leave to confer and to meet concurrently with any Committee of the Commons on European Legislation, &c. or any Sub-Committee of that Committee for the purpose of deliberating and of examining witnesses; and have leave to agree with the Commons in the appointment of a Chairman for any such meeting.—(Lord Aberdare.)
On Question, Motion agreed to.

Science and Technology Committee
Lord Aberdare: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That a Select Committee be appointed to consider Science and Technology and that, as proposed by the Committee of Selection, the following Lords be named of the Select Committee:—

Blakenham, V.

Lockwood, B.

Carver, L.

Melchett, L.

Cranbrook, E.

Nelson of Stafford, L.

Erroll of Hale, L.

Perry of Walton, L.

Flowers, L.

Sherfield, L. (Chairman)

Gregson, L.

Tordoff, L.

Hunter of Newington, L.

White, B.

Ilchester, E.

That the Committee have power to appoint Sub-Committees and that such Sub-Committees have power to appoint their own Chairman;
That the Committee have power to co-opt any Lord for the purposes of serving on the Committee or any Sub-Committee;
That the Committee have leave to report from time to time;
That the Committee and any Sub-Committee have power to adjourn from place to place;
That the Minutes of Evidence taken before the Committee and any Sub-Committee from time to time be printed and, if the Committee think fit, be delivered out;
That the Committee and any Sub-Committee have power to appoint Specialist Advisers.—(Lord Aberdare.)
On Question, Motion agreed to.

European Communities (Spanish and Portuguese Accession) Bill [H.L.]
2.56 p.m.
The Minister of State, Foreign and Commonwealth Office (Baroness Young): My Lords, I beg to move that the Bill be now read a second time.
It gives me particular pleasure to introduce a Bill giving legal force in the United Kingdom to the instruments of accession of Spain and Portugal to the European Communities. The strict legal purpose of the Bill is to ensure that, once Spain and Portugal accede to the Community on 1st January 1986, the United Kingdom is able to honour in full the obligations undertaken in the Treaty of Accession between the applicant countries and the Communities. The Bill achieves this by amending the European Communities Act 1972 to provide that the Spanish and Portuguese treaties of accession to the EC, Euratom and the European Coal and Steel Community are included among the basic Community treaties referred to in Section 1 of the European Communities Act 1972.
It is a short and straightforward Bill that little reflects in its dry prose the political significance of the event. The south-western flank of the European Community is being completed. In future we shall be 12 democratic nations working together for a common purpose in a Community based on common ideals. As my right honourable friend the Prime Minister said when the negotiations were completed earlier this year, it is a great step for democracy and for Europe.
Britain has been a staunch supporter of the accession of Spain and Portugal. We warmly welcomed the Portuguese and Spanish applications for membership respectively in March and July of 1977. For Portugal, the application was made by the courageous fighter for democracy, Senhor Mario Soares, who eight years later was to be the principal Portuguese signatory of the accession treaty. For Spain, the application was made almost immediately after the ending of military rule and restoration of democracy with the first popular elections since the Civil War, prior even to parliamentary adoption of a new constitution. For both countries, membership of the European Community has been a political imperative. For the existing member states, their entry has been a means of consolidating democracy in Europe.
The accession process has lasted seven years. Long and hard negotiations have been necessary to find a mutually satisfactory means of integrating the two Iberian economies into the Community. There were different patterns of economic development to reconcile. Spain, with a protected economy and high tariff barriers, a large agricultural sector and highly successful horticulture and a substantial fisheries fleet, presented one set of problems; Portugal, with uneven industrial development and uncompetitive agriculture, another. The acceding countries wanted early access for their most competitive sectors. The existing member states argued for long transition in the same sectors and for early reduction in turn of trade barriers.
It has been a time of recession and high unemployment throughout Europe. But the political
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determination was there despite the practical difficulties, and the negotiations were brought to a successful conclusion in March. It was an indication of the will to succeed on all sides, and a tribute to the negotiating skills and determination of the Italian presidency, in particular those of Signor Andreotti, as President of the Council of Ministers. The Accession Treaty was signed at ceremonies in Lisbon and Madrid on 12th June, thus making it possible to meet the important target accession date of 1st January 1986.
My Lords, I turn to the outcome of the individual chapters of the negotiations with Spain and Portugal. In forming an assessment, it is of course important to remember that while the United Kingdom, like other member states, had important interests to protect. the Community could not try to impose terms on Spain and Portugal which would have destroyed their will to join. A balance had to be struck; all parties accept that it was a good balance, and I believe that the outcome is fully consistent with United Kingdom interests.
Negotiations on the arrangements for tariff dismantlement were long drawn out. Spain wanted a long transition to give her industry time to adjust. The Community argued for as short a period as possible to give early access to a long-protected market. While it was agreed to allow an overall industrial transition of seven years, the high Spanish tariffs allowed under the inequitable EC-Spain 1970 Agreement are to be cut by over half after the end of only three years, thus offering major opportunities to our exporters. In addition, under the special arrangements for cars, double the number, at much lower rate of duty than hitherto, can be exported to Spain from the first year of accession, with further improvements in subsequent years. Spanish introduction of VAT on 1 st January 1986 will replace the present tax system, which has added substantially to the resale value of imported goods and which has reduced the price of Spanish exports. Portugal will also benefit from seven years of industrial tariff transition; as an EFTA member, her import duties have not, however, been generally high. The Community textile industry will have time to adapt to the new competition from Spain and Portugal, since restrictions in this sector will continue for up to four years after accession.
The negotiations were hard fought but the result affords exciting new opportunities for our exporters, providing they are quick enough off the mark. Spain and Portugal collectively form a market of nearly 50 million consumers; they are countries of big cities, with growing electronic and aerospace industries, as well as tourism and agriculture. Large sectors of industry and agriculture in both countries will need to modernise and re-equip in order to become more competitive and thus will offer further opportunities, as will, for example, the information technology and energy conservation sectors. It is not a question of waiting until the end of the relatively short transitional period, but of acting now. If our businessmen do not act, then their competitors will take advantage of any lost opportunities.
The British Overseas Trade Board has conducted a major campaign to bring to the attention of United Kingdom business the new scope for exporting to the Spanish and Portuguese markets. In addition, I commend to your Lordships the booklets published by

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the Foreign Office and the Department of Trade and Industry the day after the Treaty was signed entitled Basic Facts on Spanish/Portuguese Accession. These set out the main elements of the agreements of potential interest to British exporters. Copies were placed in the Library of your Lordships' House on publication; more are available now in the Printed Paper Office.
Each successive enlargement has given rise to fears about the impact on Community agriculture, the dangers of adding to existing surpluses or creating new ones. Given the relative size of the Spanish agricultural sector, there has been particular concern also about the impact on existing Community horticultural producers and on the Community budget. The transitional arrangements agreed will protect the interests of British (and other Community) horticultural producers. Since Spain is a deficit producer for such products as milk, beef and cereals, British farmers will have export opportunities which will become increasingly attractive as tariffs are phased out. Portuguese agriculture, on the other hand, which is largely fragmented and uncompetitive, will be given time to adapt to Community competition by a long transitional period. The Community is making aid available to Portugal to help her develop the necessary agricultural infrastructure.
The acceding countries will not be exempt from community disciplines on production; the Dublin agreement on reform of the wine sector will apply to both Spain and Portugal and a milk quota has already been set for Spain. In the case of olive oil, it was agreed that the Commission would bring forward proposals for reform to include a guarantee threshold following accession, once it is established that a surplus exists or is likely. For these reasons, some of the more extreme pressures on the common agricultural policy and on the EC budget that might have been provoked by Spanish accession have been averted. Discussions on reform of the common agricultural policy, in the light of the Commission report on Perspectives for the Common Agricultural Policy, which calls for price cuts for the main surplus commodities, are continuing. The Government will continue to press for effective action to reduce surpluses and cut the budgetary cost of the CAP principally through price restraint.
Fisheries was one of the most difficult issues to be negotiated and among the last to be settled. The Spanish fleet is presently the fifth largest in the world. After Spain's accession, the Community fleet as a whole will be the world's second largest. It was therefore essential in the negotiations to protect limited stocks and maintain the balance of existing fishing opportunities under the Common Fisheries Policy, only so recently agreed. The outcome was broadly satisfactory. Spain and Portugal are incorporated into the common fisheries policy for its duration. But, with certain limited exceptions, Spanish and Portuguese access to EC waters is limited to those areas and species to which they currently have access. The number of Spanish and Portuguese vessels fishing in EC waters will continue to be strictly controlled and subject to strict reporting and monitoring requirements. The arrangements thus do not affect the
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effective fishing opportunities of United Kingdom fishermen.
In the light of the high unemployment rates in both acceding and existing member states, agreement was reached that there would be a transitional period of seven years for the free movement of labour, as was the case for Greece. Gibraltar and Spain have of course already given effect from 5th February to certain reciprocal EC arrangements in this field, under the agreement reached between my right honourable and learned friend the Foreign and Commonwealth Secretary and the then Spanish Foreign Minister at Brussels on 27th November 1984. But the 7-year transitional period will apply also between Gibraltar and Spain.
My Lords, I turn now to the institutions of the Community. This was not a difficult area in which to reach agreement. Spain will be entitled to nominate two commissioners and Portugal one. In the Council, Spain will have eight votes to Portugal's five: the new qualified majority necessary will be 54 votes. Spain and Portugal will hold their elections to the European Parliament no later than two years after accession.
When the negotiations began in 1979, it was clear that the financial costs of enlargement to the United Kingdom could have been very substantial. But the arrangements agreed at Fontainebleau have ensured that the United Kingdom will pay only 7 per cent. of any additional costs. It was important in the negotiations to ensure that Spain and Portugal themselves were not placed in an inequitable situation on accession, particularly since stringent transitional arrangements for agriculture meant that the two countries would be building up FEOGA receipts only slowly. The Community decided to follow the Greek precedent and establish a system of degressive refunds of their VAT or GNP contributions during a transitional period of seven years. Under these arrangements, it was intended that Spain's net budgetary position should be broadly neutral over the transitional period and Portugal should be a modest net beneficiary.
Absorption of these two new member states could have aggravated some of the problems facing the Community, had the member states not already embarked on a substantial programme of reform. The Fontainebleau agreement negotiated by this Government has provided for the necessary increase in own resources to deal with the costs of enlargement—the decision on own resources will come into effect once all member states have ratified the Accession Treaty. The Fontainebleau mechanism means that despite the increase in the Community VAT ceiling to 1.4 per cent., the United Kingdom's contribution will remain below 1.0 per cent. The successful negotiation of the budget discipline arrangements means that the framework now exists for curbing the headlong expansion of agricultural expenditure.
The Commission have made proposals for long-term reform of the common agricultural policy with price restraint for the main surplus commodities as a central feature. Quotas for milk production were agreed last year and will curb production. The last two rounds of agricultural price fixing have ensured that increases in agricultural spending have been on a

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declining trend. The wine ŕegime has been reformed and the olive oil ŕegime is to be reformed. The Community is considering at this moment arrangements to ensure that the traditional trade flows of its preferential partners around the Mediterranean basin are sustained.
The Community has long recognised the risk that a Community of Twelve could become unmanageable, that decision-making could be impaired and that the cohesion of the Community might be weakened. In this regard, enlargement has acted as a catalyst. These are the very matters we are considering at present in the inter-governmental conference. I described our approach in a recent debate on your Lordships' Select Committee on the European Community's admirable report on European Union. We are examining the proposals put forward to see whether they will lead to speedier, more efficient decision-making, to completion of the internal market, to a more competitive Europe and to a satisfactory balance among the institutions.
Let us all remember that enlargement is not just a matter of adaptation and learning to live together. Enlargement of the Community to twelve is a fact of major international significance. We are the world's largest trading bloc working together within the framework of a common external trade policy. Collectively we can make our weight felt against the industrial giants of the United States and Japan, whereas severally our voices would have little impact. We have a single voice in the multilateral trade negotiations that are so vital a feature of world trading relations, and we are jointly working for a new round of multilateral trade negotiations to avert the dangers of a slide into protectionism.
The Community includes some of the world's largest donors of aid, and the Lomé Convention enshrines a unique trade and aid partnership with 66 African, Caribbean and Pacific nations. The accession of Spain and Portugal will bring extra weight and expertise to the Community's actions in political co-operation, particularly in Africa and Latin America.
Even the founding fathers of the Community would have hesitated to predict that circumstances would have allowed us successfully to complete a second enlargement to include the restored democracies not only of Greece but now of Spain and Portugal. We all recognise and should pay tribute to the outstanding achievement of the people and the political leaders of Spain and Portugal, who have rejected the path of authoritarianism and military dictatorship and restored democracy. Spain and Portugal are countries with which we have had ties since the fourteenth century; they are part of our common European history.
Entry to the Community, adherence to the principles of the EC Treaty, and our common membership of NATO, in which we hope Spain like Portugal will play a full part, make us in the fullest sense partners together in the European venture. Our common aim is now to bring our collective energies to bear in order to make the Community work as well as possible.
I am sure that your Lordships will join me in giving a warm welcome to the accession of Spain and
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Portugal to the European Community. My Lords, I beg to move.
Moved, That the Bill be now read a second time.—(Baroness Young.)
3.15 p.m.
Lord Cledwyn of Penrhos: My Lords, we are very grateful to the noble Baroness for introducing this Bill and for her explanatory speech. It is a very small Bill, but it deals with a very large and complex subject and it opens a new and, if I may venture to say so, somewhat unpredictable chapter in the history of the European Community. We on this side of the House support the Bill and the accession of Spain and Portugal and we wish them well. We hope that the enlarged Community will develop successfully.
Over the years, political, economic and social arguments have been advanced for and against the existence and the enlargement of the Community. The issues have been extensively debated both in another place and here; for example, in 1973 and again in 1975. These arguments are well known and, as a member of a small European nation, the political arguments have always seemed to me to be preponderant.
It was clear from the start that there would be economic difficulties. Certainly it became very apparent from 1973 onwards that these would increase and, as the House will be aware, they have provided the recurring discords of the last 12 years or so. But these are a challenge to be met and overcome, and the concept of a wider and more cohesive European Community of 12 nations, as described by the noble Baroness—indeed, 14 nations if you count Scotland and Wales—is admirable. It may not be a super-power yet but it is a super-Community and its potential is enormous, if it can harness its undoubted genius and experience in a co-operative effort. We need not lose our national identities, but we can afford to lose a little chauvinism from time to time.
We must not, however, overlook or disregard the difficulties which exist now and which lie ahead, and the noble Baroness referred to one or two of these in her speech. The negotiations with Spain and Portugal, which have taken eight years and which we have followed carefully, have alerted us to the problems and we know that those of Portugal are quite substantially larger than those of Spain.
As the noble Baroness has indicated, the addition of nearly 50 million people involves a change in the institutions. The Parliament will be increased by 48 seats—there will be 60 for Spain and 24 for Portugal; Spain will be given eight votes in the Council and Portugal five and the Commission will increase from 14 to 17. There will, however, be certain immediate advantages to British industry and the noble Baroness has quite properly emphasised these. I hope that we shall make special efforts to maximise them.
The Government themselves have a responsibility, through the Foreign and Commonwealth Office and the Department of Trade and Industry, to ensure that as import duties come down—and the noble Baroness said that they will be down by half in three years and removed completely in seven years—our exporters are both competitive and enterprising. This is where new jobs can be created if we are quick enough off the

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mark. The special provisions for the motor-car industry, to which the noble Baroness referred, are potentially valuable and the United Kingdom's share of additional cars allowed into Spain next year will be 5,000, which is twice the current number, with further increases in successive years. This calls for smart and efficient sales, marketing and particularly after-sales service, which is something many, otherwise good industries in this country have been criticised for failing to provide.
Like the noble Baroness, I welcome the initiatives already taken by the British Overseas Trade Board which has offices throughout the country. I was also impressed by the excellent brochure it has produced giving the basic facts and statistics about the two countries. I hope that the Department of Trade and Industry, the Welsh Office and the Scottish Office are actively canvassing industries to ensure that no opportunity is lost, especially in areas of high unemployment. If I may divert for a moment, I know from a past office that the South Wales ports, which have been declining over many years, have enjoyed a very close relationship with the ports of northern Spain and of Portugal. There is no reason whatsoever why industry in South Wales should not look to these potential new markets and to the opportunities which they now present. I hope that the CBI and the TUC in Wales will be thinking very carefully of ways and means of profiting from the new markets which result from this accession.
We must not forget that enlargement is taking place against a background of economic recession, and policies which were thought right for a smaller Community will need revision in the larger and more varied grouping of twelve. I have referred to impending difficulties and the chief of these is probably in the industrial disparity between the new members and the great majority of the rest which are highly industrialised. For example, industry contributes some 20 per cent. to GDP in Spain compared with a Community average of 30 per cent., and her industrial productivity is about 40 per cent. less than that of the Community. The difference is obviously much greater in the case of Portugal. It should be remembered—I say this in fairness—that Spanish industry has made great strides in the past 20 years, and Spain is to be congratulated on those advances. But we must be very careful in this country not to think that we can allow our manufacturing industry to decline and to stagnate. That would be an unmitigated disaster for us as the Community develops.
There is also the belief in some quarters that the accession of the two new members will lead to a demand for greater protection. The Minister's view on this would be of interest. It is the case that Spain and Portugal will now have to open their markets to developing countries in line with the Community's preferential trade agreements. There could well be pressure from them in due course to raise the tariff barriers of the enlarged Community. In some parts of Britain we are concerned about the implications of the accession for the regions. Regions' accessibility to economic activity is of obvious importance. To put it crudely, this is why the South-East of England is better
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off than the North-West of England in relation to the Community. If we do not plan carefully, enlargement could exacerbate these difficulties. We need development programmes which will take account of regional disadvantages and we need to anticipate the effect of the accession of two comparatively poor countries upon the future prospects of peripheral areas such as the North-West, large parts of Scotland and Wales.
There are some observers who see the enlargement as likely to increase the disparities and the imbalances which continue to create strains upon the unity of the EC. We must at all costs strive to avoid the development of a strong economic and industrial Community heartland surrounded by a distant and backward periphery. The concentration of economic and industrial strength in one area has dangers for all of us. I do not look at this pessimistically; I say that we must consider the danger and work to avoid it. On the other hand, we should not overlook the possibility that there could be a gradual decline in the dominance of the Franco-German axis which has dictated the economic fortunes of the Community since its beginning. There could be a shift of power towards the South and the West, especially the South, from the rich to the poor as Mediterranean influence increases. This power will be reflected of course in the institutions of the Community which were dealt with by the noble Baroness in her speech.
I turn briefly to another problem, the common agricultural policy, which was mentioned by the noble Baroness. This has always been "the joker in the pack", and the recent debate in this House on a report of our sub-committee on agriculture showed that clearly once again. The gracious Speech said that the Government intend to work for the reform of the common agricultural policy, and the noble Baroness referred to that again. To talk about it is one thing, but experience shows that to achieve any revision or even a slight amendment is quite another matter. The fact is that the accession we are debating makes the reform even more urgent than it was before. The figures show that, as a result of the accession, the Community's farm acreage will increase by 30 per cent.; the farm labour force will grow by 25 per cent.; and the number of farms will rise by 32 per cent. On the other hand, the number of consumers will increase by about 18 per cent. These are figures to ponder as we look to the future.
The CAP now takes up two-thirds of the Community budget, and if there are no changes the additional burden of two countries, notwithstanding what the noble Baroness has just said, pretty well dominated by agriculture, could impose an intolerable strain unless something is done. So far we have no clear picture of what will happen. I am grateful to the noble Baroness for the explanation which she tried to give us, but I am not absolutely clear that the Government have a really persuasive reply to the problem that I have described.
Two things seem to be clear: what Spain and Portugal manage to achieve during their respective transition periods is crucial, and what the Community itself manages to achieve by way of reform, especially of the CAP, may well be decisive in terms of the survival of the Community. Here again a more flexible

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and ambitious operation of the regional development fund could provide one possible answer to the problem. I personally believe that a gradual and sensible switch away from the CAP to the regional development fund is one possible solution to the continuing problem which besets the EC.
We have had several exchanges in the House about fisheries, which is of acute interest and which the noble Baroness also mentioned. This is quite natural because of the historic importance of this industry to us as a nation. When I had responsibility for fisheries I had the privilege of giving our fishing industry a new policy which then received a general welcome. Since then the experiences of the cod war and the common fisheries policy have brought great changes. It is a completely new scene in a comparatively short space of time; and now, as the noble Baroness said, we have Spain with a fishing fleet almost as large as the total fleet of the rest of the Community put together. The transitional fisheries regime agreed with Spain is complex and I think it is much better than we thought was attainable at one stage in the negotiations. The noble Baroness referred to the need for imposing strict control. I fully agree with her. Without going into detail, it seems that the important requirements relate to enforcement and inspection, and that we and other Community countries will need to consider whether this sector needs strengthening. Perhaps when she replies the noble Baroness will tell us what steps the Government have in mind in order to do this.
Again, the position of Gibraltar after the new accession has concerned us from the start of the talks. As time passes there will no doubt be further ramifications. However, the atmosphere has improved greatly and the Foreign Secretary has reiterated that the wishes of the people of Gibraltar will be respected by Britain. No doubt we shall return to this rather sensitive area in future debates. However, it would be a mistake if we allowed this occasion to pass without saying that we have the future interests of Gibraltar very much in our minds at this time. We were also interested to read about the special arrangements which have been made for the Canary Islands.
In conclusion, I shall refer briefly to two or three other matters which I regard as being of importance. First, it is clear that a Community of 12 members will present more problems and will be harder to run, as previous enlargements have demonstrated. I sympathised entirely with the speech of the noble Baroness but she was if anything slightly euphoric on that point. I do not believe the future will be quite as easy as she hopes it will be. We understand that the debates on voting procedures are continuing and that the Government are prepared to go along with more majority voting. I hope that is true because the machinery really will get jammed unless a little common sense prevails. If the Community is to be effective, and if decisions are to be taken in reasonable time, then a more liberal attitude towards voting seems to be essential.
Secondly, we must not overlook the implications of accession for NATO. The Spanish Prime Minister has spoken of a possible referendum which might pull Spain out of the alliance. It would certainly be curious if Spain were to leave NATO at the same time that she
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joins the Community. However, I understand there are signs that other thoughts may intervene in Spain. I hope that reason will prevail at the end of the day.
Thirdly, the need for extradition arrangements between Spain and Britain now assumes greater significance. Perhaps the noble Baroness can tell the House whether discussions are proceeding on that subject. There are a number of British citizens who we in this country would very much like to see returning home for various reasons but who at the present time are enjoying the sunshine of Spain. A little thought needs to be given to the current state of this law and to the ways in which it could be improved in the light of the new situation created by this Bill.
We hope that all those matters will be resolved amicably and that enlargement will be a success. There are huge problems to be overcome—not least, if I may say so, in relation to the Portuguese economy. A sympathetic attitude to that fairly small and poor country is essential. The Community has embarked upon a great enterprise, and animated by compassion and a true spirit of co-operation it can become the major world element in the preservation of international peace and understanding. That is my belief. It is also my hope for a better future. That is why I have pleasure in supporting this Bill.
3.33 p.m.
Lord Kilmarnock: My Lords, although this is a one clause Bill designed to give legal effect in the United Kingdom to the accession treaty of Spain and Portugal to the European Community, and is thus a routine measure, it would be a pity for it to slip through your Lordships' House this afternoon without any sense of occasion. The noble Baroness has already ensured through her speech that this will not happen. She has hailed it as an important event. We on these Benches agree with her and we welcome the Bill.
For the Spaniards, it is the culmination of a process that started under General Franco, without any hope of success at that time. However, that is merely recent history, as some sectors of liberal Spanish opinion have had European aspirations for 150 years. Indeed, Jeremy Bentham—an unlikely philosopher, one might think, to appeal to the Spanish temperament—was held in high esteem in some Spanish circles in the 19th century.
However, Spanish liberalism was not to flourish politically in that century, and Spain has remained preoccupied with her own traumas, loss of empire, civil war, and isolation from Europe until very recently. Even so, the old saying that Africa begins at the Pyrenees was never true. The rivers Ebro, Douro and Tagus were the successive historic boundaries between Christianity and Islam—never the Pyrenees, which were straddled by a common architectural and linguistic heritage in the Middle Ages, and by a common political structure when the writ of the Counts of Barcelona ran up to Albi and Toulouse and around the coast to Nice. My purpose is not to indulge in an historical ramble but to put this little Bill in a broader context.
Here it is also appropriate to congratulate the Spanish people on the achievement of a democratic constitution in 1978, guaranteed by a constitutional

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monarchy. There can be no doubt that the King of Spain has trodden an extremely difficult and sometimes hazardous path with great maturity and judgment. With each year that passes Spanish democracy has become more assured.
Even so, it is unwise to be complacent—especially in view of Spain's volatile history. It is to the great credit of the Community to have recognised that this democracy should be underwritten as firmly as possible and that 10 countries have shown the political will—and the noble Baroness referred to this political determination—that has led to the introduction of the Bill before the House today. There has clearly been an overriding political consideration, as the noble Lord, Lord Cledwyn, said. The economic difficulties have not been overlooked but they have been considered capable of solution and the larger view has prevailed.
That is not to say that areas of potential tension do not exist. The noble Lord, Lord Cledwyn, referrred to Gibraltar. It is to be hoped that the reopening of the land frontiers as a result of a process initiated by Lord Carrington at Lisbon will lead to a growth of mutual interest between the Gibraltarians and the inhabitants of the Llano de Gibraltar to which the Rock is physically attached. The Rock and the mainland were always symbiotic and the best way ahead is for them to become so again. The noble Lord, Lord Cledwyn, referred also to an improvement in the atmosphere and I think he is correct about that; and Spain will now of course have to keep the frontier open as a member of the Community.
In the economic and, in particular, the agricultural sphere there are some necessary disciplines to which Spain especially will find it painful to conform. The noble Baroness referred to some of those disciplines, and I understand that my noble friend Lord Kennet will be making mention of fisheries in particular. I myself know that the Spanish food processing industry is flexing its muscles, and this may give some cause for concern to our own processors.
In the industrial and manufacturing sphere, the picture is rather different. I ask your Lordships to pause before pronouncing the accession of Spain a threat to our industries. This summer I spent two months in and around Barcelona. Catalonia is the only region of Spain in which an industrial revolution really took place. Despite General Franco's drive to industrialise Madrid, and thus assure his power base, it remains the most commercially and industrially orientated part of the peninsula.
It has also been traditionally protectionist, demanding tariffs from Madrid to protect its textiles and other exports. If we fear import penetration by the deft and diligent Catalans, let there be no doubt that they are equally if not more apprehensive of market penetration by us. They believe that they are exposing themselves to competition which will spell the end of some of their smaller and more traditional industries when the first tranche of tariff reduction takes place after three years. Nevertheless, they have put their protectionist philosophy behind them and are determined to bite the bullet of competition because they see their future within Europe and not outside it. They are prepared to accept initial disadvantages in order to secure the political prize.
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That situation is not without opportunities for us, as the noble Baroness has already said. I venture to suggest that it is an encouraging development for the cause of free trade and a step forward in the consolidation of Europe as an economic and political force of increasing weight in the world.
Portugal's accession is generally thought to present the Community with less of a problem of absorption. Portugal's low rent per capita will make her a modest net beneficiary during the transitional period—but that is what the Community is about and Portugal's democracy likewise deserves the same underpinning as that of Spain. On state visits and the like we are always reminded that Portugal is our oldest ally. As your Lordships will of course be aware, that dates from the alliance made by Ferdinand of Portugal with John of Gaunt in 1372 against Castile, of which Gaunt had claimed the throne by virtue of his marriage to the elder daughter of Peter the Cruel. As we know, this claim did not prosper. However, Portugal maintained her independence from Castile which she only lost for some 60 years as a result of her annexation by Philip II. She is a sturdy nation with whom we have longstanding links, not least through the port trade, and we are glad to welcome her on board.
I hope that the message which will go out from this short debate is that we warmly welcome both our new Iberian partners and wish them well. As I said at the outset, this Bill may be a formality, but its Second Reading is also a significant occasion and has, I believe, been recognised as such in your Lordships' House this afternoon. It puts paid, once and for all, to the notion that Africa begins at the Pyrenees.
3.40 p.m.
Lord Moran: My Lords, I warmly weleome this Bill and I should like to pay tribute to Her Majesty's Government's wholehearted and unwavering support for Spanish and Portuguese accession to the Community. I propose to confine my remarks to Portugal, where I had the privilege of spending four-and-a-half years as Her Majesty's ambassador.
Portugal's application to join was made over eight-and-a-half years ago, in March 1977, some six months after I arrived in Lisbon. I suggested to the then Portuguese Government that it might be a long process, and so it proved, primarily, I think, because the Community needed time to reform, or try to reform, its budgetary and agricultural arrangements. I am glad, nevertheless, that the process has finally been completed.
The reasons for Portugal's determination to join the Community were primarily political. Having, like us, lost its maritime supremacy and its overseas empire, it saw no future in isolation and thought it best to become part of a Western European grouping. Like the noble Baroness, I also pay tribute to the special part that my friend Dr. Mario Soares played in swinging opinion in Portugal behind this option. A good many Portuguese tended, perhaps rashly, to believe that the economic aspects might take care of themselves. Others hoped that, having overthrown a dictatorship, staved off an attempt to instal a Communist régime, and established a genuine democracy, they would be given substantial help by their richer partners in Europe.

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When I was there I took occasion to warn them that they would probably face many of the same problems that we had encountered. They import much of what they need from across the Atlantic. I explained that in fighting the battle of the budget we were also fighting their battle since, if nothing was done, they might easily find themselves, like us, being net contributors while much richer countries were recipients. I am therefore sorry that the arrangements we have negotiated with the Community to rectify our own position apply only to us and not to others, like Portugal, with the same problems. I hope it is indeed the case, as the explanatory memorandum says, that before and after the transitional period Portugal can expect to be a net beneficiary from the Community budget.
In this context I was concerned to read the remarks of the Common Market budget commissioner, Mr. Christopherson, in September, accusing member governments of breaking their promises to Spain and Portugal to neutralise the early costs of membership, by cutting back the draft budget. I see that the European Parliament has since sought to restore those cuts. I hope that on this matter we and our partners will keep our promises.
Portugal has many problems. There is the loss of revenue from African colonies and the lack of resources in mainland Portugal. Industrial investments in the past were in areas now in difficulty throughout Europe—two great shipbuilding yards, a steelworks and a textile industry. Like us, Portugal has a position on the edge of Europe—a Europe in which prosperity tends to drift from the fringe to the centre. I was particularly interested in what the noble Lord, Lord Cledwyn, said about that. The funds of the European Regional Development Fund and the European Investment Bank are not adequate to redress regional imbalances. Portugal has a very low GDP per capita—some 2,000 dollars compared with a Community average which is four times that. Nearly 30 per cent. of the population is in agriculture. What will happen if, as elsewhere in Europe, that percentage goes down drastically and countrymen drift in large numbers to the towns, looking for jobs and houses?
Portugal imports between one-half and three-quarters of its food. I know that there is to be a four-year grace period during which Portugal will not have to pay levies on its grain imports, but after that what will happen? Will the Portuguese, after 1990, be able to afford to pay the Community's high food prices? Portugal's productivity is low. It is about only half that of Spain. Her traditional products, like cork, port, table wine, minerals and wood pulp are already exported to available markets and cannot easily be expanded.
However, there are some encouraging aspects. When in Portugal I was deeply impressed by the way in which Portugal integrated into her population the enormous number of Portuguese refugees from Angola and Mozambique—the retornados. The textile industry has had good successes recently—last year I believe it exported textiles to the value of about £900 million. There are about three-quarters of a million Portuguese workers in France and elsewhere in Europe who send back substantial remittances; and Portugal is
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receiving about 500 million dollars from the Community to modernise her agriculture.
The danger for Portugal is, I believe, of being swamped by imports from Spain. Portuguese history has largely been a resistance to domination by Spain. Now Portugal will not be allowed to restrict Spanish industrial imports after 1988. The Portuguese, I know, recognise that they are going to have to make drastic changes if they are to benefit from Community membership, to modernise their industry, to build better roads—as they are now doing—and cut down their very large civil service. There is always the threat that if the experiment fails there may be damaging political repercussions. One in every five Portuguese votes for the Communist Party. This is still led by old, unimaginative, diehard Stalinists; but if it acquired more dynamic leadership—if there were to arise a Portuguese Gorbachev—it could be formidable, especially if Community membership was not a success and, instead of prosperity and progress, Portugal, like us, encountered unemployment and industrial decline.
For us the accession of Portugal is of particular importance. We have a unique relationship with Portugal going back many centuries. A British ambassador in Lisbon enjoys a very special position. The Portuguese are an exceedingly civilised people—something that is becoming quite rare in today's world. They are warm-hearted and kind; indeed, they are some of the nicest people in the world. They are among our closest and firmest friends. I think that it is enormously important that, once they are in the Community, we should regard it as our special task to help them to settle in and make a real success of their membership so that Portugal may be prosperous and stable and our own relationship with them may continue to flourish, as I am confident it will.
3.49 p.m.
Lord Shepherd: My Lords, may I add my voice to those of other noble Lords speaking in support of this Bill. I had the privilege of representing Her Majesty's Government at the accession of King Carlos to the throne of Spain a week after the funeral of General Franco. Even then, as the noble Baroness said, there were thoughts and questions among the leaders within Spain on the possibility of Spain, at some stage, being able to enter the democratic Community of Europe. Therefore we must all be pleased with the stability of Spain despite its many difficulties, and that it has been able to pass the test and has now been accepted by the Community. In the same way that is true of Portugal.
Like the noble Lord, Lord Moran, I suspect that the difficulties of Portugal will be very much greater than those of Spain. But the noble Lord, Lord Cledwyn, was quite right when he said that first the accession of Greece and now that of Spain and Portugal will add very considerably to the strains within the Community. I put it a little more strongly than that. I think it will bring very considerable pressures, of which there are already signs, that the Community should develop into two strata: those countries which are strong not being held back and those which are unable to keep up with the speed of development of the stronger ones being allowed to find their own path and their own speed of development. I think that

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would be a major disaster to the whole concept of the Community, but that is a feeling today within the Community.
I think the noble Lord, Lord Cledwyn, is quite right to say that the Minister spoke with a touch of euphoria in regard to the potential changes which are being discussed by Ministers. There is no doubt at all that steps cannot be long delayed. I believe that the strains of which I spoke and the sense of frustration that one finds are such that unless there is a real step forward within the Community structure so that the Community is able to meet the very serious challenges that not only surround it but lie also within it, and unless it is seen that improvements are being made and new opportunities, particularly for employment, are being created, I suggest that a serious situation and a crisis of confidence could develop.
Therefore I say to the Government in the sincerest terms that I do not believe time is exactly on our side. I believe we are reaching the stage when we need acts of courage and trust in terms of the Community as we now see it. We should allow it to develop, particularly, as my noble friend Lord Cledwyn has suggested, in the field of majority voting. I believe that this is absolutely necessary if we are to overcome some of the serious logjams and also the deep frustrations that are to be found within the Community offices. So in welcoming Spain and Portugal to the Community I hope the Government will recognise how this changes the situation; that the problems which exist are now more serious and that time is certainly not on our side in rectifying those difficulties and finding a solution.
3.53 p.m.
Lord Kennet: My Lords, among those who have spoken in this short debate there has been unanimity in favour of this Bill and in welcoming Spain and Portugal into the Community. It is a very short Bill about a very long treaty, and that of course is the right way round. The governments concerned are to be congratulated on having produced a good treaty.
I should like for a moment to take up the remarks which the noble Lord, Lord Shepherd, has just made. I think we can all agree with him that there will be difficulties and that perhaps time is not on our side in our attempts to solve these difficulties, but I am sure that he will agree that the feeling in the Community will not in any way be anti-Spanish or anti-Portuguese.
Lord Shepherd: No, no!
Lord Kennet: My Lords, it will be a feeling about the difficult common task of absorbing two economies which are not only poorer than most of those which are already on board but also different from them. It can be done, and I agree with the noble Lord that it is urgent, but let me add a word of caution about the two tiers that he mentioned. I should have thought that we had too often been told that we were not good enough to be in the top tier and should form part of a second tier in the Community. We have been told that too often to wish it on anybody else. Our part in this should be to resist such proposals. It should be regarded not as a burden but as an honourable duty by the more wealthy countries in the Community to carry
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the poorer ones for part of the way. That is what "community" means.
Gibraltar has been touched upon briefly, and it is good that this matter is being satisfactorily resolved. There is a natural tendency in Parliament and the press in this country to forget about things when they come right or look like coming right. I should like to dwell for a moment on the amazing fact that a quarrel which for a couple of centuries has looked as if it might blow up at any time and which in the last two years has looked really quite menacing is now back where it belongs—on the table between civilised and moderate governments, who are awaiting with pleasure the day when it will partly solve itself by accession, but only partly. The whole House will wish the Foreign Secretary well when he goes to Madrid in March to carry this matter one stage further forward.
I understand that Spain is now taking a lot of trouble to find the right two commissioners, and for this the rest of the Community can be grateful to the Spanish Government and opposition. In the European Parliament the political Right in Spain is to join with our own Conservative Party in the European Democratic group—which I think will be pleasant for them and they will have some sensible allies—and the Spanish Socialist Party is to join the Socialist Group in the European Parliament, where they will clearly be an asset to what one might call the more constructive wing of that group.
Fisheries are another matter which has gone right and on which for that reason it is not incorrect to dwell for a moment. The treaty is ingenious. It allows Spain the same access that it had under its treaty with the Community as an extraneous country over the last few years, with two exceptions, one each way; that is to say, it may not fish in the picturesquely named "Irish Box" for 10 years, as it has done up to now, and on the other hand it may have 4,500 tonnes of hake more a year than it has been allowed so far. Together with the limitation on the number of boats which are fishing and the quota system, this looks like a good enough régime to last for the 10 years that it is billed to last. But we can be very glad to see that the review conference on this matter is scheduled for 1993—two years before the expiry of the fisheries régime. That is only realistic. It will be hard to negotiate a new one. In the meantime the governments concerned are to be congratulated on having learnt the lesson of our own accession to the Community when the fisheries problem was just swept under the carpet and it took 12 years of bitter wrangling, ill-will and even occasional violence before it was solved. We look like getting it right this time and that is good.
I come now to the main point. I share the feeling which has been expressed by several noble Lords that though the Government are right to be optimistic they are perhaps in danger—though we would not expect them to declare their hand fully—of being too optimistic about the CAP. Can we imagine, when the present support grants for cereals and certain other foodstuffs are extended to Spain and Portugal, and when Spanish and Portuguese agricultural producers, who are, by Community standards, so much in excess of the consumers—we have just had the figures for consumers—become fully subject to the cat's cradle of payments, repayments and re-repayments which

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occur at the internal frontiers of the Community, that it will then be possible to hold VAT at the present level of 1·4 per cent., a level which this country has not even reached? Can we imagine that it will be possible for us to continue to hold ours below the general ceiling of 1·4 per cent? Can we imagine that it will be possible for the general ceiling to remain as low as 1·4 per cent?
Is it not rather the case that probably next year, and almost certainly in 1987, there will be immense pressure on the Council of Ministers to get national agreement to a raising of that ceiling; either that or a beneficial pressure stronger than we have yet known for a proper and fundamental reform of the CAP and—if I may say, as it were, something un-Social Democrat and rather pro-Conservative—for a natural freeing of market forces? If things were to go that way, we should be glad of the difficulties which we shall face in the next two years because they will force us all in the richer part of Europe (in the North) to face the realities of this CAP.
The Government will also be bearing in mind—and I do not complain that they did not mention it—the fact that for reasons best known to itself the Council of Ministers has this year proposed a Community budget as if there will be only 10 countries in the Community in 1986, but of course there will be 12; and that makes it inevitable that there will be one or two supplementary budgets with all the wrangling that that always entails superimposed on the wrangling that will be natural to the enlargement itself.
That is the dark side. The good side is that all five countries on the European fringe of the Atlantic are now fairly and squarely democratic, and anchored in democracy; and the four peoples who invented the unitary sovereign nation state—the British, the French, the Spanish and the Portuguese—are now together in the first human experiment that there has ever been in going beyond absolute sovereignty: the European Community.
4.1 p.m.
Baroness Young: My Lords, I believe that we have had a very good debate this afternoon. It has been a short one, but I have been much heartened by it. I think that there has been a unanimity of view on giving the Bill a fair wind to see it on the statute book in time for the accession of Spain and Portugal on 1 st January 1986.
Your Lordships' speeches have shown that this House not only gives full support to the accession of Spain and Portugal to the European Community but shares the Government's belief that that enlargement represents a real turning point in the history of Europe and a determination to make a success of the new Community of 12. First Greece, and now Spain and Portugal, have succeeded in throwing off military dictatorship and restoring democracy. In acceding to the European Community they are joining a unique adventure undertaken by European countries which share common ideals and which seek an ever closer union among their people.
Spain and Portugal have been part of our common history since the beginning of the modern age. Both countries have made an inestimable contribution to our heritage and the way in which we look at the world
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about us. Had it not been for the determination and courage of Iberian adventurers in the 15th century the world today might have assumed a different aspect. Now their voyage of exploration is of a different kind. Centuries of conflict among the nations of Europe, from which Spain and Portugal have not been spared, have given way to a firmly based commitment to build a new Europe in which such conflict will no longer be possible.
That commitment is no mere act of governments It reflects a profound belief of the peoples of Europe that our continent must never again suffer the ravages which two world wars inflicted on the first half of this century. That is the rock on which this enterprise is founded. We should not lose sight of that essential truth when our attention is drawn to the inevitable disputes and teething troubles that mark the creation and development of the European Community.
Your Lordships have asked a number of specific questions in the debate, and I should now like to try to answer them. I was most interested in the speech of the noble Lord, Lord Cledwyn of Penrhos. I think that I speak on behalf of everyone when I say how well he put the case for the Bill. He described the advantages to British industry and the opportunities for new jobs that are opened up by the increased markets which we hope British business will take, and we all echo his congratulations to the British Overseas Trade Board.
The noble Lord asked whether the enlargement might lead to a cut in United Kingdom receipts from the regional and social fund. We expect to continue to receive substantial sums from the structural funds, but we have to face the fact that Spain is a relatively poor country. Its GDP is 56 per cent. of the Community average and it has problems of unemployment and regional disparities. Portugal will be the poorest Community country. Its GDP is 24 per cent. of the Community average. We believe that it is important that both should benefit from the Community structural funds. Nevertheless, as I said, we shall continue to receive substantial funds. I was interested in the noble Lord's point about the advantages that may accrue to South Wales, as I am sure were many other noble Lords, with its links with ports in Spain and North Portugal. I hope that that will be possible.
The noble Lord also asked whether accession would lead to further protectionism in the Community with regard to third countries. I very much hope and expect that the Community will maintain its attachment to the principles of free trade. I have no reason to believe that in joining the Community Spain and Portugal intend to change that. The Community fully supports the launch of the new GATT round in order to maintain an open trading system and to avert a slide into protectionism.
The problems of the reform of the CAP were referred to by both the noble Lords, Lord Cledwyn and Lord Kennet. I should hate the noble Lord, Lord Kennet, to think the Government were over-optimistic about the problems of the reform of the CAP. We have had enough difficulties over the negotiations as it is. The Commission Green Paper is a valuable attempt to address the fundamental issues, and we agree with its argument that restrictive pricing is the best way to get the CAP under control by cutting costs and cutting surpluses.

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The noble Lord, Lord Cledwyn, asked about Spanish extradition, an issue which he put most tactfully. The treaty which was signed on 22nd July we expect to be ready to ratify early in the New Year. The Spanish procedures are more complex. Spain has a written constitution which requires treaties to be voted on in the Cortes before ratification, but we hope that that will be done soon.
The noble Lord also touched on Gibraltar, which is a subject that we have discussed many times in your Lordships' House. He will know that the transitional arrangements, derogations and transitional periods agreed between Spain and the Community will apply equally to Gibraltar. For our part, we have stated our position on sovereignty quite clearly on many occasions.
The noble Lord, Lord Moran, to whom again I am sure we all listened with great interest, particularly as he is a former ambassador in Portugal, asked about aid for Portugal. I can confirm to him that the Community fully recognises the need to give particular help to Portugal. Quite apart from pre-accession aid of 400 mecu, the Community will also give Portugal 700 mecu aid post-accession over 10 years to help to develop agricultural structures, and a further 1,000 mecu loans under the new Community instrument.
The noble Lord, Lord Shepherd, raised a point that has been, I believe, of concern to your Lordships and has been raised before in the House about what has come to be known as a two-speed Europe. With enlargement, the Community's membership will, of course, be more diverse and its economic structures more varied. We do not rule out some flexibility of approach in the coming decade in areas where that makes sense, as already happens for some Community research programmes in which not all member states take part, to give an example. But this variable geometry, as it has come to be called, is a far cry from dividing the Community into distinctive groups operating on different rules. We do not see how this would be either practicable of justifiable.
Several of your Lordships suggested that perhaps in the remarks that I made I was too euphoric about the future. If I have spoken in those terms it is not only from a strong personal commitment to the Community but also from very strong belief that we should see the Community in more than just economic terms and in all the technical and complicated detail that is required to reach the position that we have now attained on this Bill. It is important, not only for all of us here but also for the coming generation, to be reminded of the great ideals that inspire the Community and, we hope, will still govern it.
In conclusion there is no doubt about the support given by this House to the Spanish and Portuguese accession. Spain and Portugal will be working with their partners in future to fulfil the objectives of the EC treaty. They will be working with us in future, in the words of the treaty, for common action to eliminate the barriers which divide Europe and for the pooling of resources to strengthen peace and liberty. It is right that Spain and Portugal should be with us in this great experiment. Today we welcome them.
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On Question, Bill read a second time, and committed to a Committee of the Whole House.

Legal Aid (Financial Conditions) Regulations 1985 Legal Advice and Assistance (Financial Conditions) Regulations 1985 Legal Aid (Scotland) (Financial Conditions) Regulations 1985 Legal Advice and Assistance (Scotland) (Financial Conditions) Regulations 1985
4.12 p.m.
The Lord Chancellor (Lord Hailsham of Saint Marylebone)rose to move, That the regulations laid before the House on 6th November be approved. [1st Report from the Joint Committee.]
The noble and learned Lord said: My Lords, this is a somewhat parochial matter after what we have been discussing. It is also something of an annual event. There are four Motions standing in my name. With the permission of the House, I shall speak to them all together. I am told—I hope that this will be confirmed—that, assuming that the House accepts this, I can put the Question en bloc.
The first two Motions relate to legal aid and legal advice and assistance in England and Wales. The other two relate to Scotland. As in the past two years, these proposals come before the House at the same time as the increases in supplementary benefit, that is, in November. The supplementary benefit changes take place on 25th November. That is the date also proposed for the changes in legal aid.
The first two Motions increase the income limits for civil legal aid and the income capital limits for legal advice and assistance. The increases average 5·1 per cent. This maintains the present relationship between legal aid and supplementary benefit. The regulations raise the lower disposable income limit, that is, the level of disposable income below which no contribution is payable from £2,145 a year to £2,255 a year. The upper income limit, that is, the limit above which legal aid is not available at all, increases by the same proportion from £5,155 a year to £5,415 a year. There is no change in the capital limits. Since the supplementary benefit limit is to remain the same as last year, that is, £3,000, it seems preferable to keep the identical legal aid lower capital limit unchanged as well. Similarly, I propose to hold the upper capital limit at its present level which is £4,710.
The advice and assistance regulations raise the upper disposable income limit for the "green form" scheme from £ 108 a week to £ 114 a week. The capital limit above which assistance is not available under this head is increased from £756 to £800. The two sets of Scottish regulations, the Legal Aid (Scotland) (Financial Conditions) Regulations 1985 and the Legal Advice and Assistance (Scotland) (Financial Conditions) Regulations 1985, make the same increases for Scotland.
The House will also be aware, I believe, that there is a further set of regulations for which an affirmative

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resolution is not needed at all. These are the Legal Advice and Assistance (Financial Conditions) (No. 2) Regulations. These increase the lower disposable income limit for "green form" advice and assistance from £51 to £54 and revise the scale of contribution that an applicant for advice and assistance may be required to make. Similar increases relating to Scotland are contained in the Scottish regulations, the No. 2 regulations, of 1985.
I am also proposing to increase the financial limits for criminal legal aid by the Criminal Proceedings (General) (Amendment) Regulations 1985. These require parliamentary approval but only by the negative resolution procedure. They increase from £44 a week to £46 the disposable income above which a person receiving legal aid in criminal proceedings under Part II of the Act of 1974 is required to pay a contribution. The regulations also amend the scale of contributions.
In addition, I have placed before the House under the procedure subject to negative resolution three instruments for Northern Ireland which have the same effect on the legal aid and legal advice and assistance provisions there.
At the time of the last up-rating I told the House that I proposed to increase the capital assistance for what is called assistance by way of representation. That is given in the jargon of the trade the abhorrent name of ABWOR. That is an extension of the legal advice and assistance scheme and provides for representation in certain specified proceedings before courts and tribunals. I propose to increase the capital limit there to £3,000. That is the same level as the lower legal aid capital limit. I took the necessary power to do this in the Administration of Justice Act that has just received Royal Assent. The necessary regulations will be laid before both Houses of Parliament in the near future. That covers the regulations which I am under a duty to speak to before the House. I beg to move.
Moved, That the regulations laid before the House on 6th November be approved. [1st Report from the Joint Committee.]—(The Lord Chancellor.)
4.18 p.m.
Lord Elwyn-Jones: My Lords, the House will be grateful to the noble and learned Lord for taking us through these regulations. As he says, they are by now an annual event occasioned by the inflation from which we continue to suffer. The effect of the up-rating of legal aid limits will not, as I apprehend, result in increasing the number of people in the community who are eligible for legal aid, advice or assistance. They seek merely to ensure that those who are now enjoying those facilities will continue to do so.
The changes are certainly of the most modest character and we are particularly anxious about the position with regard to capital provision, about which I apprehend that my noble friend Lord Elystan-Morgan may be commenting. The provision of legal aid has been recognised as a highly important social service ever since it was brought into being in 1949.1 wondered whether, without undue pressure upon his department, the noble and learned Lord could give us some picture of the benefit that the legal aid system has
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brought to the community in terms of the numbers who have enjoyed the facilities within a given period; how many civil actions have been brought under the umbrella of legal aid; and, if this were a possible exercise without massive research, what has been the outcome of the litigation?
As the applications have to go through a preliminary sieve by the appropriate committee of the Law Society, who must be satisfied that there are reasonable prospects of success before permission is given for legal aid to be granted, one would expect and hope that the success factor would be very considerable. If the material is available, I think it would be of great interest to the community to know and see how the scheme is operating. Undoubtedly, without the legal aid and advice schemes hundreds of thousands of our fellow citizens who have benefited from them since 1949 would have been in effect denied access to justice, which would have been an intolerable blot on our administration of justice.
With regard to the provision for ABWOR, to which the noble and learned Lord referred, I wonder whether he could elaborate on that a little for us? To what tribunals do the arrangements apply? As far as I recollect, the Lands Tribunal and the mental health appeal tribunals are the only two tribunals where legal aid is allowed. I wonder to what extent the ABWOR arrangements give the general possibility of legal advice and assistance in other tribunals as well? If it is convenient for the noble and learned Lord to refer to it, perhaps we can have some help about that.
We should also like to know what use is made of the ABWOR provisions, which provide a valuable extension to the legal aid and advice scheme. On the criminal side, a great deal of comment was made last year when we discussed the varying standards and practices between one magistrates' court and another in the granting of certificates and legal aid in criminal proceedings. I do not know whether the situation has improved in the course of the last year. There were previously some startling statistics of the variation between one magistrates' court and another in he willingness or unwillingness to grant legal aid in criminal cases. That again leaves a sense of inequity and unfairness: one gets legal aid or not depending on the magistrates' court one has the good luck or bad luck to be hauled before.
As I understand it from the noble and learned Lord, these provisions apply to both Scotland and Northern Ireland and that is obviously a very desirable measure.
In conclusion, may I fire a warning shot across the bows of the noble and learned Lord the Lord Chancellor—if that does not seem to be an unfriendly operation—with regard to the crisis that is now being reached on the position of law centres. Many of them are now in grave peril of having to be wound up altogether. When we discussed this in detail some time ago, the noble and learned Lord refused to accept any responsibility save for those that apparently I managed to rescue from destruction—according to him, with doubtful legality. I do not accept that for one moment. However, we shall be anxious to know what is to happen to them. Not only has the noble and learned Lord so far abdicated responsibility for them, but, having put me on to the Secretary of State for the

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Environment, which produced an equally unresponsive reply, there was an attempt to pass the buck wholly to local authorities, which are in increasing difficulty, particularly in the very areas—the impoverished cities and towns—where law centres have been able to render such great service. This is a very grave matter.
The law centre provisions have been a handmaid of the legal aid and advice scheme and if that has to be abandoned the consequences in the matter of social order and social relations within law centre areas will be very greatly aggravated. I hope therefore that the Lord Chancellor may hold out some hope in this field, although I appreciate that it only emerges indirectly from the orders. However, subject to those groans—which I think are legitimate—we support the regulations.
4.27 p.m.
Lord Denning: My Lords, may I say a word about this. In a way this is a small matter of keeping up with inflation so far as the limits of legal aid are concerned. But I wish to throw out a thought. In this country law is now available for the rich; it is available for the poor; but it is not available for the middle classes, and the limits of legal aid ought to be extended to make it available to people of the middle class.
Let me give just two illustrations. Any person of the middle class who is litigating with one of the poorer class is at a grave disadvantage. In one instance, a man sold his business for about £5,000, payable by instalments. The debtor did not pay. The plaintiff was just above the lgal aid limit. He had to go to a lawyer at his own expense. He had to sue the debtor. The debtor got legal aid in order to raise all sorts of defences to that claim. The case took two or three years. It cost the middle-class man £8,000. He got judgment for £5,000—and then nothing out of the other man. He had to pay £8,000 because he could not get legal aid. That is with regard to a plaintiff.
Let us now take the case of a defendant. A man is sued by a poor person who is legally aided, perhaps on a boundary dispute or something like that, and the defendant does not get legal aid because he is just above the limit. In those circumstances the man who has legal aid is at a tremendous advantage. He can go on litigating, put the defendant to no end of expense; and, although the defendant wins the case, he cannot get the costs from the legally-aided plaintiff at all.
Some of these inequalities were stressed during the last Session, when we ventured to suggest that a lot of improvements could be made. All I would ask today is this. Is it not'time that legal aid was extended beyond those poor limits to cover the middle classes of this country? The rich can litigate themselves; they are all right. The companies can litigate themselves. It is the middle classes who deserve to have legal aid available to them. If that were granted they would have to pay a contribution, but there would be discretion with the judge as to costs. That is the most important point. Therefore, I would urge not a minor increase to cope with inflation, but a wider revolution to extend legal aid to the middle classes of this country.
4.30 p.m.
Lord Wigoder: My Lords, it is one of the hallmarks of a civilised society that, because of their inadequate means, its citizens are not deprived of access to the courts. As these four orders represent a modest step in the continuation of the process which was begun many years ago in this country, we of course give them our full support. However, if I may, I would very respectfully echo the forceful point just made by the noble and learned Lord, Lord Denning.
The noble and learned Lord the Lord Chancellor referred to the question of legal aid in criminal cases, and because of that reference I hope that I shall not range too far outside the terms of these Motions if I mention that many of us are very much concerned that those who participate in criminal proceedings should be adequately remunerated. I hope that the noble and learned Lord the Lord Chancellor might perhaps be in a position to give some indication as to when the Government will respond to the submissions recently made by the accountants, Coopers & Lybrand, as to the fees at the moment being paid to the criminal Bar in legal aid cases. Any reply which the noble and learned Lord can give will I know be greeted with great interest.
4.32 p.m.
Lord Simon of Glaisdale: My Lords, I want to make only a few remarks in support of what was said by my noble and learned friend Lord Denning. They arise out of an observation that was made by my noble and learned friend Lord Elwyn-Jones to the effect that these measures, although useful and helpful in keeping the limits within the range of the rise in inflation, have no effect on taking anyone out of the legal aid scheme—they merely keep the same numbers in it.
I venture to put this point to my noble and learned friend the Lord Chancellor. By merely raising the figures in line with inflation, we are driving people out of the legal aid scheme so long as earnings increase in excess of the rate of inflation, as they have for a great number of years now. I know that hardly a day goes by without one or other of your Lordships—including, I confess, myself—urging increased public expenditure on this or that: whatever our favourite impulse may be. I know too that my noble and learned friend the Lord Chancellor is very capable of fighting his own corner when it comes to the allocation of public expenditure. Indeed, my experience was that he was often fighting everyone else's corner as well! When the matter comes to be reconsidered, I would venture to urge on my noble and learned friend that, so long as earnings in their increased rate exceed the increase in inflation, then merely by keeping the legal aid scheme in line with inflation increases we are driving more and more people outside it. That I know is contrary to the wish of my noble and learned friend and of all your Lordships.
4.35 p.m.
Lord Elystan-Morgan: My Lords, although this is an interesting and valuable debate, it lacks the high drama that has characterised some earlier debates on legal aid. I was not present on the occasion, but I read with very great interest the speech of the noble and

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learned Lord the Lord Chancellor in which he likened himself to Actaeon at the moment of his death, I was about to say at the hands but it was more at the teeth of the sleek hounds of Diana. Certainly, we are not in a position to consider such matters on this occasion; but we are glad of the opportunity which is given us year by year, through the necessity to amend these rates to meet the changes in the value of money, to review, as it were, the position in relation to legal aid.
There are two matters which I should like briefly to mention in my intervention. The first is the question of a consistency to be maintained as much as possible between one legal aid area and another in the grant of legal aid. I seem to remember that one of the annual reports by the legal aid authorities—I believe that it was either in 1981 or 1982—contained certain statistics concerning what appeared to be a capricious difference between certain legal aid areas and others in the percentage of cases that were granted certificates for legal aid.
My understanding was that there was to be further research in this matter. Together with I am sure every other Member of the House, I should be very interested to know how much research is done by way of monitoring and whether there is any ground for suspicions that from time to time a lack of consistency may exist between one area and another in the grant of civil legal aid. Clearly, in so far as the grant of criminal legal aid is concerned, there is inconsistency. It is a matter that many Members of this House, including myself, have turned to during the course of various debates.
I have read with very great interest statistics which appear in the September issue of Legal Action which are based upon researches carried out by the Lord Chancellor's Department. No doubt a great deal of monitoring work has been done. The statistics show that there is a lack of consistency. For example, the lowest percentage of refusal was 10 per cent., which was registered by Area No. 4, the South-Western area. The highest percentage of refusal was 16 per cent., which was the North-Western area, Area No. 7. When it came to the review rate in the South-Western area, Area No. 4, it was as low as 1.7 per cent.; and in the Northern area, Area No. 8, it was as high as 18 per cent.
On the whole these figures do not show any alarming divergences between one area as compared with another. But in my submission this masks the reality rather than underlies it. The real disparity exists, not between one area and another, but between one magistrates' court and another. I believe that in England and Wales there are some 700 magistrates' courts. Very often there are two courts within a stone's throw of each other and sometimes one court has a percentage figure which is three or four times that of the other. I appreciate of course that it is infinitely more difficult to gather this information on a court-by-court basis; but unless and until that is done, I do not believe that the reality of the problem will have been made public.
I turn now to the question that has been raised by my noble and learned friend Lord Elwyn-Jones, by the noble and learned Lords, Lord Denning and Lord
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Simon, as well as of course, by the noble Lord, Lord Wigoder. That is the question of the poverty trap. There is no doubt at all that hundreds of thousands of people suffer considerable injustice. I am conscious of that in my day-to-day practice at the Bar. I do not believe that anyone would pretend that there is an easy solution. There can be no solution by carte blanche. Nobody would suggest that for a moment. I doubt whether there is a solution by disregarding capital altogether, though it is right to remember that the Scottish Royal Commission on legal services made a specific and, if I remember correctly, unanimous recommendation to that effect. Powerful arguments were articulated in favour of treating capital wholly different from income. I need not go over them now, but it is obvious that that is a tenable argument.
The Benson Committee on legal services for England and Wales came to a slightly different conclusion: that it was wholly necessary to regard capital but, on the other hand, vitally necessary that there should be far more generous scales than those which have been conceived up to now. It is a very real problem. It is a problem that involves the denial of justice. I think it was Anatole France who said (and it has been quoted in this House often), that the Ritz Hotel is open to everybody. The courts of our land are open to everybody. It is the denial of means to enable a person to conduct litigation, sometimes in a defensive capacity, when that litigation has been inspired, and properly so, by the presence of legal aid that is the heart and core of the problem.
4.45 p.m.
The Lord Chancellor: My Lords, I have been given quite a battery of questions to answer—some of which I can, some of which I am likely to forget and others of which I probably cannot; but I shall do my best. I shall try to put this thing to some extent into perspective. I preside, successfully or otherwise, over what is the fastest growing in expenditure of all social services. This is particularly true in criminal legal aid. Indictable crime has been going up at a rate of compound interest of an average of 10 per cent. per year. Of course 90 per cent. of that is criminal legally aided. It must be said that this year looks like being rather worse than the average. The increase over the first six months was about 14 or 15 per cent. or perhaps a little more.
There are very heavy contraints upon me as to what I can do. It is no criticism whatever of noble Lords who have participated in this debate to say that if one is simply concerned with one's own area of departmental responsibility it is easy to find extended uses for other people's money. But if one is a member of the Government one is also collectively responsible for such things as hospitals, schools, teachers' pay, law and order, defence and the health service. One has to weigh the demands of one's own department against the perfectly legitimate demands of other departments and to fit them into a coherent policy. If one is to be loyal to one's colleagues and do one's duty as a member of the Government, one has therefore to moderate personal demands. In presiding over a rapidly expanding service that is what is called demand led—that is, that I do not determine the number of crimes committed every year in this

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country, or the rate of increase—one has to be very careful indeed.
This year there are a number of pressures upon me which are quite independent of what I have so far been discussing. I am glad nobody has mentioned the 24-hour duty solicitor scheme, but it is not very far from my own mind. I have to find another £20 million for that alone, though it was budgeted by the Philips Commission for about £6 million.
I cannot give an answer today to the noble Lord, Lord Wigoder, but he raised a perfectly germane question of the Coopers & Lybrand report, which is concerned with the remuneration for barristers in criminal legal aided cases. Very closely allied with that is that if one raises remuneration for barristers, I do not think that winter in the shape of solicitors can be very far behind. At the same time that the solicitors come cap in hand my right honourable and learned friend the Attorney-General is trying to set up a prosecution service, members of which will certainly not expect to be paid much less than the defenders. Thus your Lordships can see the kind of problem I am faced with; but I do not think it is anything like as bad as the noble Lord, Lord Elystan-Morgan, evidently believed.
This leads me to refer to my noble and learned friend Lord Denning. To begin with, civil legal aid applies to about 70 per cent. of the population. With respect, to say that the middle classes (whatever they may be; I have always regarded myself as one) are wholly excluded, does not live with that kind of percentage. One cannot include 70 per cent. of the population without including a great number of otherwise middle-class people.
Secondly, we have to recognise that, contrary to the general perception, it is the poor man who always has had the advantage of litigation, if he can get his litigation launched. That is because if he sues a rich man he can get his costs successfully. The rich man probably will not get his costs out of the poor man. That has been so ever since the noble and learned Lord, Lord Denning, was called to the Bar, and probably for 500 years before that. That is a very long time indeed.
Having said that, I should also say that it is not quite true that the legal aid fund cannot be made to pay in the case of a unsuccessful claim or defence; nor is it quite true to say that an assisted person cannot be made to pay. I shall not go into the details otherwise I shall take too long; but that is not quite right. One has to remember also—I think the noble and learned Lord, Lord Denning, did not spell this out specifically—that in order to get legal aid, whether one is financially eligible or not, one has to pass the merits test by the wholly independent system of committees in civil legal aid of the Law Society. They are supposed to apply, and I believe they conscientiously do apply, the same kind of test that an honourable solicitor or barrister would apply in advising an unassisted client whether to defend or not to defend or to initiate or not to initiate legal proceeedings.
The result is, first, that about 80 per cent. of civil legal aid certificates (I do not include matrimonial) succeed and therefore get their costs out of the other side. Secondly, if for any reason at any stage of the
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proceedings, which may, we fear, last for a long time, it comes to be apparent that either the claim or the defence is without foundation, the legal aid certificate can be withdrawn. Thus, the picture is nothing like as black as I think the noble and learned Lord gave the impression of its being. The answer to the question from the noble and learned Lord, Lord Elwyn-Jones, is, about a quarter of a million. I can give the exact figure. The actual figure for the year 1984–85, the last figure available, was 222,160—about a quarter of a million legal aid certificates granted.
There has also of course been an increase in matrimonial cases. There was a natural surge after we removed the three-year bar but that is plateauing out. It is impossible in the case of matrimonial proceedings, where very often both parties are legally aided, to give a significant figure for success or failure. One thinks that if both clients are reasonable, the case will be settled. However, in either event, both parties lose as a result of divorce. These adjustments, whether they are battles about children or battles about money, which they normally are, cannot be viewed in the way that personal injuries cases can be viewed, as either having succeeded or having failed.
Another general point that I should like to make, which I think should be made in relation to the speech of the noble and learned Lord, Lord Denning, is that over a very wide range, whether one is middle-class, working-class or very rich, the money for litigation comes out of income tax. In the enormous proportion of contract cases which arise in the course of carrying on a business—this must be true—the costs are offset. This is also true in the case of defendants in personal injuries cases, which form a very high proportion of legal aid certificates, because it is the insurance companies which pay the costs—even if one happens to be middle class—and the insurance companies set it off against the Chancellor of the Exchequer, against their profits. Thus one should not at all exaggerate the position of the middle classes.
Nor am I altogether withers wholly wrung by the noble and learned Lord, Lord Simon of Glaisdale. Of course, it is true that if earnings rise in relation to costs, people are—I will not say driven out of the legal aid scheme; they rise gleefully above it because, after all, if they are richer, they are richer, and that is a very good thing and not a very bad thing. However, while dealing with these general topics I must say that, having regard to the fact that my costs are rising so exponentially year by year, there cannot be any case for extending the provision to the entire population, even if one wanted to do so.
The noble and learned Lord, Lord Elwyn-Jones, asked me about the kind of representation which is given the jargon name of ABWOR. Of course, these are mainly for domestic proceedings in magistrates' courts and mental health review tribunals. The mental health review tribunal is the only tribunal properly co-called which I think qualifies for ABWOR, although the Lands Tribunal and one other which I think is called the Agricultural Tribunal count for civil legal aid.
The noble and learned Lord, Lord Elystan-Morgan, and the noble and learned Lord, Lord Elwyn-Jones, asked me a very interesting question about the inconsistencies between individual magistrates' courts

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in the granting or refusal of legal aid within their jurisdiction. The noble and learned Lord is quite right in saying that the Lord Chancellor's Department conducted a survey of some 60 courts in an attempt to establish what was happening, although one cannot very easily compare one with another because of the different patterns of cases which come before individual courts. For instance, if you have a motorway within your jurisdiction, it quite dramatically alters the pattern of refusals.
Nevertheless, I should be the last to deny the fact which the noble and learned Lord, Lord Elystan-Morgan, referred to and the other noble and learned Lord referred to, that there were at that stage, and shown as a result of that research, inconsistencies which could be explained only by inconsistent patterns of behaviour as distinct from inconsistent patterns of cases.
It will be remembered that in the legal aid regulations I introduced last year, and in response to this piece of research, I introduced an avenue of recourse where magistrates' courts were not prepared to grant legal aid for indictable offences. The new Criminal Legal Aid Committee have directly shown that they play a valuable role in that area. This is a wholly new function and I think that it will have to be allowed to work itself in. We, together with the Law Society, are watching the position closely, but I think before seeking further changes I should like to know how it was working.
A warning shot was fired across what the noble and learned Lord was courteous enough to refer to as my bows, about law centres. I think that would take me rather far into distant and bush country. However, I at once recognise that in deprived areas they have a limited function. I do not think that I have business in what is essentially a local service. However, whether my right honourable friend, who is concerned with urban deprivation and the urban programme, will at some stage feel inclined to make a concession in that area, I should not like to say today.
I should say that, except in areas where there is a shortage of practitioners, the law centre is not designed to be and ought not to operate as an alternative to the green form scheme. The standard scheme for giving legal aid advice and assistance should remain the green form scheme. It is only where that cannot be seen to operate that I should recommend the law centre to have a separate reason for its existence. Over a great part of the country, the green form scheme would be adequate.
I think I have answered a large number of questions put to me. I shall try, if I may, to have this debate carefully monitored and if I have left anybody out by mistake, or left out any points by mistake, I should like, if I may, to remedy it by correspondence.
So far as the noble Lord, Lord Wigoder, is concerned, I am not yet in a position to answer about Coopers & Lybrand for the kinds of reasons that I have been giving: a great many repercussions are involved and a good many related questions would have to be solved. I am examining the report very carefully. I shall, of course, be in touch with the profession about it. I am not in a position to make a statement today.
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I am very grateful indeed to all noble Lords who have taken part in this debate and I hope that I have covered a good deal of the ground, if not all, that has been raised in the course of it. With that, I commend the Motion.
On Question, Motion agreed to.

Atomic Energy Authority Bill [H.L.]
5 p.m.
The Minister of State, Scottish Office (Lord Gray of Contin): My Lords, the objective of this Bill is to put the finances of the United Kingdom Atomic Energy Authority onto a trading-fund basis; and for connected purposes. Your Lordships will recall that I indicated that legislation would come forward on these matters when I reported the Government's decisions on the AEA review on 11 th February.
As is customary, I should like to start by explaining the background to this measure. As your Lordships will know, the United Kingdom Atomic Energy Authority was created by the Atomic Energy Authority Act 1954 with a wide range of responsibilities for nuclear matters. It was initially almost entirely funded by the Government. Since then, the authority has undergone a number of significant changes. The Science and Technology Act 1965 gave it the power to carry out non-nuclear research and development as required by the Secretary of State. The Atomic Energy Authority Act 1971 "hived off' the radiochemical activities of the authority to what is now Amersham International, and the fuel manufacture, enrichment and reprocessing work to British Nuclear Fuels plc. And in 1973, under the Atomic Energy Authority (Weapons Group) Act, the weapons group of the authority was transferred to the Ministry of Defence.
The context in which the authority operates has also significantly changed. In 1954, the authority effectively was the nuclear industry. With the design, construction and operation of the nuclear power stations which are now supplying about 20 per cent. of our electricity needs, and the growth of reprocessing, other centres of expertise have grown up. But the authority's role as a research and development organisation underpinning the nuclear industry and exploring ways in which it might develop in the future remains a key one. Today the authority employs some 14,000 staff, 2,800 being qualified scientists and engineers. It has 10 sites in widely separated parts of the country. Its gross expenditure is around £400 million per annum. About half its income has in recent years come in the form of a grant-in-aid from the Department of Energy for nuclear research and development. The remainder comes mainly from contract work on nuclear research and development for other United Kingdom customers; for example the electricity supply industry and British Nuclear Fuels plc; and from customers for non-nuclear R&D. Thus, a large part of the authority's work is already under contract and is held in very high regard for its scientific and technical excellence.
It is against this background that my right honourable friend the Secretary of State for Energy set in hand last year a wide-ranging overall review of the role and activities of the authority, including whether

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its present relationship with the Department of Energy remained appropriate. The terms of reference were, first, to examine the main programmes of the authority, with reference to the character, funding and accountability for these programmes and their bearing on the role of the authority; secondly, to consider, in the light of this review and of other factors, whether changes were required in the role and accountability of the authority, and in its relationship with the Government; and to make recommendations to the Secretary of State for Energy.
Following consultations with the various interested parties, the decisions reached by the Government in the light of the review were announced on 11th February. The Government endorsed the two guiding principles recommended by the review team—that the authority should move to a fully commercial basis of operation as a further spur to efficiency; and that defined customer-contractor relationships should be applied as far as possible to its work. They therefore decided that more of the authority's work should be funded by the nuclear industry, that the Department of Energy's funding of nuclear research and development should move on to a customer-contractor footing, and that the authority's operations should be placed on a trading fund basis from 1 st April 1986. Your Lordships may find it helpful at this point to be reminded of the key features of Government trading funds. These are: a capital structure including a commencing debt; a profit and loss account and ability to carry surpluses or deficits forward from one year to the next; powers to borrow, subject to a limit on total indebtedness; and a duty to achieve, to the extent possible, financial objectives set by the responsible Minister, with the agreement of the Treasury.
In reaching decisions on the review's recommendations, the Government also recognised the authority's crucial contribution to the development of civil nuclear power and high nuclear-safety standards in this country; and endorsed the continuing need for it to act as a source of high quality, independent advice in these areas. The Department of Energy will therefore continue to fund a substantial programme of thermal reactor and general safety research by the authority. The authority's customers will also contribute to the continued funding of a vigorous and independent underlying research programme.
Privatisation of the authority is not a realistic option at this stage. Nor, however, is continued reliance on grant aid. Putting the authority's operations on a trading-fund basis will, we believe, bring increased market and commercial pressures for efficiency and for continued technical excellence. Clear financial objectives will aid the measurement of success. The authority will have increased end-year flexibility and greater discretion over the use of internally generated funds.
The Department of Energy will, as well as remaining the authority's sponsor in Whitehall terms, become accountable as a customer in a way it was not before. It will in future provide funding against "programme letters" covering such research and development areas as the fast reactor, advanced gas-cooled reactors, pressurised water reactors, general safety issues,
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fusion, radioactive waste management, radiological protection and suchlike. These programme letters will be settled following discussion between the authority and the department, who will be assisted by outside technical advisers. They will set out Government policy objectives relevant to the programme, and relate these to the objectives of the work programme, the proposed budget, the longer-term trends and a detailed description of the research and development, including milestones. The Department will of course monitor the work done and the money spent against the milestones and estimates in the programme letters with the objective of ensuring that the taxpayer obtains value for money. But the Government have decided not to build up an unnecessary apparatus for control and monitoring within the department to duplicate the resources of the authority. They will remain accountable to Parliament for their technical advice and efficiency of programme execution and also subject to inspection by the Comptroller and Auditor General.
One of the operational areas also covered by the programme letters is the authority's existing waste management and decommissioning operations. The Government have in the past accepted that they would pay the costs of meeting future waste treatment and decommissioning liabilities at the time they arise. Although the authority's operations are being placed on a trading fund basis, the Government will continue to accept responsibility in principle for the costs which the authority will incur arising from programmes carried out before 1st April 1986, and from future departmentally-funded programmes. Expenditure will be monitored and controlled through the appropriate programme letters.
Many of these changes—important though they are—do not require legislation. But placing the authority on a trading-fund basis with powers to borrow does: because under the 1954 Act the authority has no such powers, and as an already established body the provisions of the Government Trading Funds Act of 1973 cannot apply to it. The nine clauses of this Bill therefore provide for the main structure of a trading fund, without affecting the legislative bedrock of the 1954 Act. In brief, their purpose is as follows.
Clause 1 provides for the assumption by the authority of a commencing debt. This will be a debt related to the value of the authority's net assets at the start of the trading fund. The commencing debt will take the form of a notional loan from the National Loans Fund, deemed to be made on 1st April 1986, and repayable with interest. The period of repayment will be agreed between the authority and the Secretary of State. As I have already indicated, a commencing capital debt is a standard feature of trading funds. It reflects the fact that the Government have, in the past, grant-aided the authority so that it has been able to build up its asset base to its present levels. The commencing debt (and the interest on it) is to be repaid by the authority out of its trading profits.
Clause 2 defines the authority's borrowing powers. As a trading fund, it is intended that it should fund its capital requirements, including working capital, from internally-generated funds and borrowing. The amount the authority can borrow will be subject to the overall limits set in Clause 3 and to an annual external

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financing limit set by the Secretary of State with the approval of the Treasury, after consultation with the authority.
Clause 3 imposes a borrowing limit on the authority, prescribes what is to count towards the borrowing limit, and allows for the limit to be increased by order if Parliament approves. Clause 4 empowers the Secretary of State to lend to the authority and sets out the procedures governing such loans. Clause 5 permits the Treasury to guarantee borrowing by the authority from non-government sources, and sets out the arrangements to be followed if any such guarantee is called. Clause 6 provides that the authority carry out capital investment and other developments only within plans approved by the Secretary of State.
Clause 7 provides that compensation may be paid to members of the authority for loss of office, for which there is no provision in the 1954 Act. This clause also repeals, as anachronistic, a section of the 1954 Act which requires the Secretary of State to lay a statement before Parliament when the salaries of members of the authority are altered. Current practice is for Her Majesty's Stationery Office to publish annually a booklet which covers the salaries of members of all public bodies, including the authority.
This is a small Bill, but it is also a significant one. The effect will be to make the authority more like a nationalised industry, and to give it a greater scope for development than grant-in-aid arrangements can provide. The Government consider it to be the logical outcome of the evolution in the role and activities of the authority over the past 30 years. It should provide a sound basis from which the authority can contribute still further to the development of civil nuclear power and non-nuclear technologies, while continuing to provide a source of expert advice to Government on a wide range of issues. I believe that the proposals provide an incentive for all concerned and I commend them to your Lordships' House. My Lords, I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read a second time.—(Lord Gray of Contin.)
5.13 p.m.
Lord Stoddart of Swindon: My Lords, I should like first of all to thank the noble Lord, Lord Gray of Contin, for explaining the Bill, for doing it so well and, indeed, for explaining the background of the nuclear industry itself. I am sure the House will have found that most helpful: I certainly did. But I hope the noble Lord will forgive me if I say that the Opposition is rather suspicious of this Bill. It is quite true that it is a small Bill, but it is a very important one, as the noble Lord said. The Bill itself seems innocent and innocuous enough; yet, so far as the Opposition is concerned, behind its seemingly mundane provisions there could lurk serious problems and dangers for the continued existence of the AEA as an independent body advising the Government on a wide range of nuclear matters, ensuring safety in nuclear matters and keeping Britain in the forefront of underlying research.
I was glad to hear the noble Lord say that privatisation was not a realistic option. What worried me a little was that he added, "at this stage". We do not think it is a realistic option at any stage, and we feel
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that evil intent can often be masked by an innocent countenance. Our fear really is that this Bill, with its provisions for putting the authority on a trading fund basis, is simply paving the way for future privatisation. It is true, as I have said, that the noble Lord stated that that was not a realistic option—he said that this afternoon—and, indeed, the Parliamentary Under-Secretary of State, Mr. Alastair Goodlad, gave the assurance in another place on 11 th February this year that there are no plans to privatise the AEA. Nevertheless, the trading fund concept is clearly a step in the direction of privatisation.
The Manley Report, to which the noble Lord referred, certainly considered privatisation as an option; and suspicion of the Government's motives and future intentions has been heightened by the failure to publish the report in full. That has heightened suspicion, not only by the Opposition but also, I understand, by staff working for the authority. It seems to indicate that the Government have something to hide; and I would ask the noble Lord whether he will now arrange for the publication of the report in full as an indication of the Government's good faith in this matter. I would ask him to state firmly and clearly that the Government have no intention to privatise the AEA, not only during the lifetime of this Parliament but for all time, or at least for the foreseeable future. Can he go that much further than he did in his opening remarks?
Perhaps it would be as well if I asked him at this stage, and indeed in connection with privatisation, what is meant by Clause 3(3) of the Bill, which states:
"If a body corporate ceases to be a wholly owned subsidiary ot the Authority, the Secretary of State may, having regard to the extent to which the amounts taken into account for the purposes of subsection (1)",
and so on. Clause 3(3) relates to the possible denationalisation of a subsidary of the AEA. Does it mean that the authority can be privatised piecemeal; and, if so, by what means? The clause certainly gives the impression that the authority may dispose of a wholly owned subsidiary without further reference to Parliament, but I cannot see how this can be so. Yet, if Parliamentary approval is necessary, I cannot see the need for the provision in Clause 3(3), since that matter could be dealt with when Parliament was dealing with the question of the disposal of a wholly owned subsidiary. I recognise that I may be misreading the clause, and I should therefore be grateful if the noble Lord, Lord Gray, could deal with the point when he winds up the debate.
I should like now to turn briefly to the question of accountability to Parliament. When the Parliamentary Under-Secretary made his statement in another place on 11th February, he was asked specifically by my honourable friend Mr. Alexander Eadie whether this move to a commercial basis would weaken parliamentary accountability. Mr. Goodlad's reply, in col. 32, was quite specific. He said (and I quote):
"On the hon. Gentleman's third point, there will be no reduction in accountability to this House because of the change to the trading fund." [Official Report, Commons, 11/2/85.]
That reply was absolute. There was no equivocation; no "ifs" or "buts". There is to be no change. Will the noble Lord now confirm that statement? Indeed, will he underline it? Will he state categorically that

531
commercial confidentiality, for example, about which we heard a good deal during the passage of the Oil and Pipelines Bill, will not be increasingly used as an excuse for weakening Parliament's role in nuclear matters and keeping from them information which is necessary and vital for their oversight of the authority's affairs?
There is certainly one sense—and the noble Lord mentioned it in his opening remarks—in which parliamentary control will be affected by the Bill. In Clause 7(2) the duty to lay statements of remuneration, etc., of members of the authority is repealed. Will the noble Lord please explain this clause further and say why this does not weaken parliamentary accountability? Members of Parliament, particularly in the other place, often glean a good deal from the salaries and conditions of service of members of the board, and the noble Lord himself will know that very well.
I should now like to discuss the main part of the Bill concerning the authority's finances, and certainly there are a number of important questions which arise. First, in Clause 3 the authority's borrowing limit is set at £150 million, which may by order be increased to £200 million. The borrowing limit is, as the noble Lord mentioned, to include the authority's commencing capital debt, but there is no indication of what that entails. Is the commencing capital debt to be £50 million, £100 million, or what is the figure?
The Bill refers in Clause 1 to consultation with the authority and to the approval of the Treasury. What does this mean? Is consultation with the authority to be real and meaningful, or perfunctory? Will the Treasury have the last word, and, if so, does this not give them an arbitrary power over the authority's finances right from the start? I sincerely hope that the noble Lord will comment on that.
Perhaps the noble Lord will also say if consultations are now in progress and whether there is agreement on the commencing capital debt; and, if so, what that figure is. The noble Lord will appreciate that without knowledge of the commencing capital debt it is difficult to assess whether the borrowing limits will be adequate for the authority's needs. This information is also vital in order to assess the authority's ability to meet the targets which will be set by the Government.
We are also entitled to have an indication of the rate of return expected of the authority. I have heard a rate of 5 per cent. mentioned, and if this is correct I should have thought it was a high figure, particularly during the early years of the new arrangements. Will the noble Lord give some information today of the likely rate of return which the Government will expect? The noble Lord may very well say that it is too early at this stage to give such information, but he will appreciate that there are worries that, if the rate of return is set too high, this could have an effect on staffing levels and, indeed, on salaries, which would be squeezed by the authority's straining to meet an unrealistic rate of return.
The other element which could be at risk in the event of an unrealistic rate of return is underlying research, which will be particularly vulnerable during the transition period, since the pressure on costs will be
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at a maximum and the return on investment a long way off. The noble Lord will, I feel sure, understand the point and, I hope, sympathise with it. I wonder whether consideration has been given to phasing the transfer of the underlying research programme to the trading fund over a period of years, bearing in mind the importance of underlying research for the future. Do the Government intend to apply some underpinning, by means of contracting directly for a proportion of the underlying programme? That would certainly be helpful, particularly in the early years of the trading fund arrangements.
Clearly, the authority should not be burdened by unreasonable demands and commitments, but also it should not be at the mercy of Treasury diktat and raids on its earnings, which will be needed to finance future investment and to expand worthwhile programmes. I sincerely hope that the noble Lord can give emphatic reassurance on these matters.
I notice that the overall effects of the transition to a trading account basis on the PSBR are expected to be broadly neutral, and, of course, we must accept that as the Government's best assessment of the position. However, what is the likely effect on the authority's non-departmental customers? Are the Government sure that their proposals will not put the authority in a worse competitive position in relation to these customers, and are they confident that the authority will be able to cope with the situation unless sufficient time is allowed it to adjust to the new arrangements?
May I now ask about the fusion programme? The noble Lord will recall that on 15 th October we had a long and interesting debate on that matter and fears were expressed—indeed, they were expressed by myself and by other noble Lords—that the Government may in the future not be as committed to the fusion programme as they have been in the past. May I ask the noble Lord how these new arrangements will affect the fusion programme and the Government's commitment to it? Can he also give some attention to the question of the fast breeder reactor? How, in fact, will the CEGB be involved in the future with the fast breeder reactor programme? I understand that it will be expected to meet a greater part of the cost of the programme. Can he say to what extent this will be, how control of the programme will be managed and whether a greater control of the programme will pass from the AEA to the CEGB itself?
May I now turn to the composition of the authority board? The noble Lord will accept, I feel sure, that it is essential that the board should be seen to be completely independent and free of pressure from commercial interests. It should be completely committed to the objectives of the organisation and to no other. That being so, part-time members who have a beneficial interest in the organisations which have formal contractual arrangements with the authority should not, surely, be permitted to serve on the new board. I hope I shall be told that the Government are in agreement with this view.
Another important aspect concerns the people who work for the AEA. They undoubtedly feel that their jobs and conditions of service could be at risk from commercialisation. When the UKAEA was established in 1954 and when British Nuclear Fuels

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was hived off in 1971, employees were guaranteed that their pay and terms and conditions of service would be no worse than those of civil servants. Indeed, the 1953 White Paper even promised salaries
"not seriously out of line with those paid by other public corporations."
That promise in the White Paper has certainly not been kept. Indeed, Government pay policy has held salaries down, with the result that the Atomic Energy Authority is losing professional and scientific staff and is unable to recruit replacements. The assurance that the people working for the authority need is that their terms and conditions of employment are maintained and that salaries should be at a level where staff of all grades can be recruited and, indeed, retained.
Furthermore, they need the assurance that the Department of Energy will not impose cash limits on the authority's wages and salaries bill that will lead to distortions in wage and salary patterns and to unjustified reductions in staffing levels. The staff certainly do not want to be the sacrificial lambs on the Government's commercialisation altar. I should welcome the noble Lord's comments and assurances. There are aspects of the commercial approach which are, of course, beneficial, and we accept that. But it is misguided to believe that every area of human endeavour is necessarily improved by the commercial approach. Nuclear safety, for example, is a matter which cannot and must not be jeopardised by this approach. The public are entitled to expect that the AEA's contribution to nuclear safety is in no way compromised or affected by the Government's preoccupation with commercialism or the new customer/contractor relationship between the authority and the CEGB. The noble Lord will, I trust, give an absolute assurance that nuclear safety will not be in any way affected, and, indeed, I hope he will outline the safeguards intended to see that nuclear safety will not suffer as a result of this Bill.
I want to say in conclusion that our attitude to this Bill in its later stages in this House will depend very much on the answers which the noble Lord gives to the many questions I have asked. I make no secret of the fact that the Opposition do not trust this Bill. I was going to say that we do not like the Bill. We do not trust the Bill and we think it is possibly unnecessary for the proper development of the AEA. As I said at the beginning of my speech, the Opposition suspect that it is a paving measure for full-scale privatisation. Nevertheless, in so far as the provisions of the Bill are concerned, we do not wish to be obstructive but we shall require firm assurances about the matters I have raised, and perhaps others, between now and Committee stage.
5.31 p.m.
Viscount Thurso: My Lords, it is no secret that my colleagues on these Benches do not entirely share my enthusiasm for atomic energy; nor are they so well aware of its usefulness to us as a nation and in the future. However, this does not mean to say that they are in any way against atomic energy; nor indeed that they are against the work which has been done by the Atomic Energy Authority in the past. I know that certainly two of my colleagues, the noble Lords, Lord Ezra and Lord Lloyd of Kilgerran, would have liked to
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have been here to speak in this debate. Unfortunately both are prevented from doing so. They tend to agree with the move that is being made to put the Atomic Energy Authority's finances on a trading basis. However, I find myself rather more critical of this measure than they are, and I find that many queries arise in my mind, some of which the noble Lord, Lord Gray of Contin, has been able to answer, some of which will remain in my mind until we see how the Bill progresses, particularly through the Committee stage, and some of which I may be able to ask the noble Lord now.
The Atomic Energy Authority was originally set up in 1954 with the primary responsibility of advising the Government on nuclear power. In the mind of the public this is still the principal function of the Atomic Energy Authority. The noble Lord, Lord Gray of Contin, as a Ross-shire man, will be perfectly well aware of the high regard in which Caithness holds the establishment at Dounreay and of the high regard in which those who are close to atomic energy hold the authority in so far as they are not solely commercially minded. They are scientifically and professionally interested in the reputation of the plant, and they are people of integrity whose word can be broadly relied upon. Any erosion of the high standing in which they are held is bound to be harmful to the interests of the country.
It is important that the body which is responsible for advising the Department of Energy upon the dangers or the desirable avenues to be explored and so forth in an industry so obviously subject to hazard should clearly be as independent as possible of the normal commercial pressures. For instance, before this country decided to pursue the pressurised water reactors, the authority had to be in a position to assess the safety of this particular form of reactor and to carry out assessments to advise the Government on the relevant merits of these reactors, as compared with the gas cooled reactors. It is no secret that in the process of doing so, and in carrying out that work, it was found that there were some possible safety limitations on the performance of the fuel. Then research and development work was carried out and the original assessment of the authority was proved to have some foundation in fact. Work was then carried out to find how these limitations could be made acceptable. Similarly, work has been carried out to improve the performance of gas cooled reactors. This again has involved first class staff reviewing the situation and carrying out research and development work to reach conclusions which were and still are of considerable importance to this country.
On a trading fund basis the limitations on the use of staff and equipment in this way might become very difficult if the work has to be solely commercially supported. After all, the results of research and development are never totally predictable and they may produce results which commercial organisations might not want to know about and for which they might not be very willing to produce funds because of the danger of showing that their plans might be unacceptable. I am certainly looking for assurances that this method of funding is not in any way going to affect the independence of the authority as the main adviser to the Government. I hope I received this

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reassurance in the speech of the noble Lord, Lord Gray of Contin, in which he said that the Government would still be looking to the Atomic Energy Authority for high quality independent advice and that they would not build up another organisation. That would be a ridiculous and foolish thing to do when they already have an organisation which is perfectly capable of doing the kind of job which the Department of Energy requires to be done and which they only have to keep in being in order to get that kind of high quality advice.
I too was slightly puzzled by the phrase,
"privatisation of the authority is not a realistic option at this stage".
I hope that in giving reassurances the noble Lord, Lord Gray, will reassure us that privatisation is not at all envisaged. It would be quite wrong if one were to privatise one's advisers as a department of government. I hope that the privatisation of this function of the Atomic Energy Authority will never be envisaged.
While I see the importance to the country of obtaining a return through the authority on the investment in atomic energy, in setting up the commencing capital debt of the authority the Government intend to use a figure based upon the expenditure and the investment which has taken place so far in plant and equipment.
I believe that I heard the noble Lord, Lord Gray, correctly when he said that the Government intended that the commencing debt should be repaid. That seems a rather curious thing to do when presumably that equipment has been acquired while the authority was not on any kind of trading fund basis. Therefore, the profits out of which the authority might have been expected to repay the debt were not made under the original contracts. A little more explanation from the Minister as to what is meant and where the money is to come from in order to repay the commencing debt is called for. It sounds as though when the authority borrow money in the future they will not only have to make a profit on the money that they have borrowed but also make another profit in order to repay the money which theoretically they borrowed, although they did not borrow it—if the noble Lord follows my reasoning.
Another facet of the work of the authority to which the noble Lord referred was waste management and decommissioning. Those are two extremely important aspects of the work of the Atomic Energy Authority. They are very important in the minds of the general public. First, I hope that we have received a full reassurance—although it would do no harm to reiterate it—that there will be no shortage of funds for the management of the waste created by work that has already taken place, and that there will be no shortage of funds either for proper decommissioning of plant that has already served its function and is in the process of being decommissioned. It is very important to the public to be reassured on those points. It would do no harm if the noble Lord the Minister were to give the House such a reassurance.
While he is dealing with that point, perhaps the Minister can give the House some information about the state of play—an update perhaps—with regard to the European reprocessing plant which it is proposed
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might come up to Dounreay. Again, the local welcome for that is quite reasonable as these things go, but I wonder how strong the welcome would be if it were thought that the plant will be too highly commercial. The way in which the public regard the Atomic Energy Authority is very different from the way in which they regard, for instance, British Nuclear Fuels. It is felt that one has a commercial outlook and that the other has a more scientific outlook. The Minister should be aware of that. It would be interesting if the Minister could give the House some indication of the present state of play with regard to that project and to the management of nuclear waste in the future.
We give qualified support to this Bill. We are not totally against it but we are not totally for it. We feel that the independence of the Atomic Energy Authority as an advisory body must be ensured. If we see any point at which that is being threatened by the Bill as we examine it in Committee, then we shall certainly reserve our right to criticise the Bill and try to amend it. Meanwhile, we on these Benches give the Bill our qualified support.
5.45 p.m.
The Duke of Portland: My Lords, I welcome this Bill, which will place the operations of the Atomic Energy Authority on a trading fund basis and thus give it greater freedom of action. While the Central Electricity Board may well be a very big customer of the authority, I trust that the authority will not be regarded as an appendage of the Central Electricity Board. I hope that the authority will not only be free but also encouraged to undertake such research, development and other activities as its management may think fit.
I feel confident that this Bill will give the authority, and in particular the establishment at Harwell, a fresh and vigorous lease of life.
5.46 p.m.
The Earl of Kintore: My Lords, although I do not have my name down to speak, I should like to ask my noble friend a question in general terms. Can he tell the House what is the modern equivalent of beating the spear into a ploughshare? How does one beat a nuclear weapon into a ploughshare? It appears to me that one method would be to convert those weapons into fuel rods for nuclear plants. I should like to know what the Government's thoughts are on this matter, and whether they are making any proper provision.
We all hope that disarmament will lead to a large number of redundant or surplus nuclear weapons. But merely stockpiling them in another place without dismantling them will not answer anything. One is merely no longer pointing the weapon. One cannot just leave them lying about, nor can they be burnt except in a nuclear furnace.
5.47 p.m.
Lord Gray of Contin: My Lords, we have had a very useful debate on the occasion of the Second Reading of this Bill. I am most grateful to the noble Lord, Lord Stoddart of Swindon, and to the noble Viscount, Lord Thurso, for the constructive approach they have taken to this Bill from their respective Front Benches. I will do my best to answer some of the questions they raised

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and to give the reassurances which they asked of me. I should also like to thank my noble friend the Duke of Portland for his welcome for the Bill.
I must thank too my noble friend Lord Kintore for his contribution, and perhaps I may begin by explaining to him that the Bill is in no way connected with nuclear weapons. Indeed, one of the problems which the nuclear industry has constantly to face is that of making the distinction between nuclear power for civil purposes and nuclear weapons. This Bill, relating as it does to the nuclear industry as far as its civil aspects is concerned, is not related to nuclear weapons. Therefore I hope that my noble friend will forgive me if I do not take up his challenge to state the equivalent of beating spears into ploughshares. However, I wanted to make that distinciton clear and I am grateful to my noble friend Lord Kintore for giving me the opportunity of doing so.
The noble Lord, Lord Stoddart, and the noble Viscount, Lord Thurso, both raised at the very outset the question of what difference the measures we are taking will make to the attitude and performance of the authority. I can assure them that what we are seeking today is to place the Atomic Energy Authority on a trading fund basis with a revised capital structure and powers to borrow. We believe that this will encourage a more commercial approach and greater efficiency. I am sure that both noble Lords will certainly agree with me that it is very important, in whatever industry we are talking about, to encourage efficiency and to ensure that the AEA carries out its operation in as efficient a manner as possible.
I made it absolutely clear—and again I give this assurance to both noble Lords who asked me to do so—that the Government have no plans for the privatisation of the authority. I mentioned this in my opening speech and it was clearly stated also by my honourable friend the Parliamentary Under-Secretary of State in another place. I confirm for a third time that privatisation is not the intention of the Government.
I was pressed to give that assurance for ever. I am afraid that "ever" is a very long time, and noble Lords will realise that it is simply not in my gift to give assurances for ever and ever. What I can say is that the Government have no plans for the privatisation of the AEA.
Lord Stoddart of Swindon: My Lords, it is true that I asked the noble Lord to give an assurance that the AEA would never be privatised. However, I asked whether he would give the assurance specifically that it would not be privatised during the lifetime of this Parliament or for the foreseeable future. Can the noble Lord give that assurance?
Lord Gray of Contin: My Lords, I can certainly give the assurance to the noble Lord as far as the lifetime of this Parliament is concerned, but no Minister, and no Government, is in a position to commit successors. Therefore I can merely reiterate what has been said by energy Ministers elsewhere—that the Government have no plans for the privatisation of the Atomic Energy Authority.
The noble Lord, Lord Stoddart, also asked about accountability. The change to a trading fund will not
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bring about any reduction in accountability to Parliament for expenditure on nuclear research and development. The department's permanent secretary and the AEA chairman will continue to appear before the Public Accounts Committee. The department will answer on policy and overall programme specification. The AEA will answer on its technical advice and efficiency of programme execution. As regards commercial confidentiality, the transfer to a trading fund basis will make no difference whatever.
The noble Lord also asked whether the review can be published. I remind him of the very full summary of the report which was published on 3rd October last year, copies of which were placed in the Libraries of Parliament. The report itself is a classified internal departmental document, and it is not normal practice to publish confidential advice to Ministers. However, I trust that the noble Lord will accept what I have said about the very full summary that has been made available.
The noble Lord, Lord Stoddart, also asked about the financial return. In setting the financial target for the AEA trading fund for the first three years we have taken into account the likely earning power of the AEA, bearing in mind the nature of its business and the market situation. In the light of financial projections for the first few years of the trading fund's operations the Government believe that a 5 per cent. target return on current cost assets will be a realistic challenge for the authority. The noble Lord cast some doubt on this, but we have looked at it very carefully and we believe that it is a realistic challenge. That is why the figure of 5 per cent. has been taken.
Viscount Thurso: My Lords, before the noble Lord leaves that point, he mentioned that the Department of Energy will be giving contracts to the authority. Can he say what sort of margin there will be on these contracts?
Lord Gray of Contin: No, my Lords. With respect, I cannot do so, because these are obviously matters which will be negotiated between the authority and the department. It is not for me at this stage to assess what might be the margin the authority would look for in a contract with one of its customers. We are interested in what the authority can achieve at the end of the day in its accountability—what its bottom line is at the end of its financial year.
Viscount Thurso: My Lords, but will there be a margin in these contracts?
Lord Gray of Contin: My Lords, I presume that when contracts of such a nature are being discussed the authority is bound to have a figure in mind. However, that figure is not one which it would necessarily publicise, because on certain matters where it is giving advice such information might be useful elsewhere. Therefore I would hot think that the authority would necessarily wish to make known the figure on which it is working.
Lord Mackie of Benshie: My Lords, may I add to the noble Lord's troubles and ask whether he can tell us how the Government are to value the assets on which the authority will be charged to make a 5 per

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cent. return? Will they go back on all the money that has been spent and all the grants that have been given? This is very important, because it would appear that the Government will be placing a considerable burden on the authority and that they are going to fund the past expenditure, charge interest and charge the authority also with repayment of the capital and the interest. Therefore the valuation of the assets would appear to be very important.
Lord Gray of Contin: My Lords, the noble Lord, Lord Mackie of Benshie, has asked about the valuation and revaluation of assets. The authority is carrying out a full-scale asset revaluation exercise. All its assets are being revalued to current cost, so that the assets shown on the opening balance sheet of the trading fund will represent as realistically as possible their current value to the business. Does that satisfy the noble Lord?
Lord Mackie of Benshie: It informs me, my Lords.
Lord Stoddart of Swindon: My Lords, I am obliged to the noble Lord for giving way again, and I am sorry to have to pursue this. Nevertheless, as far as I can see at a quick glance the present assets amount to about £273 million. Is that the kind of figure that is to be used; or is it to be higher or lower? Indeed, if that is the figure that is to be used, does it not mean, on a 5 per cent. return, that the authority will virtually have a surcharge of £ 13 million from the outset?
Lord Gray of Contin: My Lords, I do not completely agree with the noble Lord's figures, though his opening figure of £273 million was not too different from mine. It seems likely that the opening capital employed will be around £250 million—that is, £185 million of fixed assets and £65 million of net current assets. The exact figures will not be known until the 31st March 1986 balance sheet is produced. Within this, the breakdown will be approximately a commencing capital debt of £80 million, a revaluation reserve of £105 million, a general reserve of £62.5 million and insurance provision of £2.5 million. However, as I explained, these are at this stage approximate figures which we obviously cannot finalise until the 31 st March balance sheet is produced.
The noble Viscount, Lord Thurso, asked me particularly about the question of Dounreay, and I should like to take this opportunity—and I emphasise to your Lordships that I take the opportunity as a representative of the Government's energy interest in this House rather than as a Scottish Office Minister—to comment on the proposed reprocessing plant at Dounreay.
Your Lordships may recall the open letter which my right honourable friend the Secretary of State for Energy wrote to the chairman of the authority on 21 st May. The Secretary of State indicated that the Government considers that the fast reactor, which is 50 times more efficient in the use of uranium than thermal reactors, will be of major strategic significance for the United Kingdom's and the world's future energy supplies. The United Kingdom is among the world's leaders in this technology as a result of the successful programme of research and development undertaken by the Atomic Energy Authority and
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centred at Dounreay, but the Government also recognised that substantial financial resources are needed to achieve commercialisation and that some international sharing of the costs is desirable. It is against this background that in January 1984 my right honourable friend the Secretary of State for Energy signed an inter-governmental memorandum of understanding to develop the fast reactor and its fuel cycle with his counterparts in France, Germany, Italy and Belgium.
We believe that research and development work will be done more effectively and economically by working together rather than by each country duplicating effort. The inter-governmental memorandum of understanding has paved the way for a number of implementing agreements drawn up by the respective nuclear industries of the partner countries. Some have been signed; others are in course of negotiation. At the working level, detailed collaboration is already taking place. It is envisaged that the collaboration will come to focus on a sequence of three demonstration fast reactors. These will be built in France, the Federal Republic of Germany and the United Kingdom, but decisions have not yet been taken on their specific timing, siting or financing.
All this is relevant to the Dounreay proposal because, to achieve the fast reactor's full potential, commercial demonstration is required not only of the reactor itself but also of the fuel cycle. At intervals the fuel in the fast reactor has to be changed. The spent fuel is reprocessed so that unconsumed and newly created plutonium can be recycled and fabricated into new fuel. The collaborating electrical utilities, which, subject to Government approval, will finance the reactors through cross-investment, regard it as essential that the demonstration reactors should be backed by fuel fabrication and reprocessing facilities. While there are prototype reprocessing facilities at Dounreay and Marcoule in France, they are insufficient for the demonstration programme and a further plant is required. The United Kingdom is a strong contender for this plant and the Government see advantages in siting it here, subject to the necessary planning, safety and environmental consents being granted.
This would enable British Nuclear Fuels and the authority to build on their long experience in this field. The authority has been reprocessing at Dounreay for over 25 years and the present small-scale reprocessing plant in support of the prototype fast reactor has been operating successfully since 1979. British Nuclear Fuels plc already plays a world role in the commercial reprocessing of thermal reactor fuels and wishes to be in a position to extend its business into the fast reactor field when series ordering of fast reactors begins. Thus, if built here, the project would provide job opportunities both during construction and operation and potentially for the longer term. The financing of the United Kingdom share of the project would be provided by British Nuclear Fuels supported by contractual commitments from the utilities, and there would be no call on public expenditure.
I have given that information—indeed, I have had it prepared for me—because I thought it almost inevitable that I would be asked by somebody what was the latest state of play at Dounreay and I am glad to have

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this opportunity of bringing the House up to date on this matter on behalf of energy Ministers in the Department of Energy.
A question was asked about the effect on fusion of the measure which we are discussing tonight, and I can assure your Lordships that the move to a trading fund in no way affects the authority's fusion programme.
The noble Lord, Lord Stoddart, also raised with me the question of membership of the board. So far as part-time members of the board are concerned, it is expected that there will no longer be part-time members holding executive responsibility in the CEGB, BNFL or the department.
I have tried to answer as many as possible of the points raised, but in the short debate which we have had your Lordships will agree that a great many points were raised and I think it likely that I may have missed a few of them. I shall have my officials carefully read what I have said, and perhaps I may write to noble Lords who have raised any issues with which I have not specifically dealt.
I am most appreciative of the qualified welcome—and, after all, at Second Reading one would not expect more than a qualified welcome—from Members opposite. I am grateful for that qualified welcome and look forward to the further stages of the Bill, when we will have an opportunity to discuss some of the aspects in more detail. My Lords, I beg to move that the Bill be read a second time.
On Question, Bill read a second time, and committed to a Committee of the Whole House.
House adjourned at seven minutes past six o'clock.