HL Deb 17 October 1985 vol 467 cc710-816

3.35 p.m.

Further considered on Report.

Clause 85 [Expenditure on public passenger transport services]:

The Minister of State, Ministry of Agriculture, Fisheries and Food (Lord Belstead) moved Amendment No. 213: Page 88, line 38, leave out paragraph (b) and insert—

The noble Lord said: My Lords, I spoke to this amendment with Amendment No. 148. I beg to move.

On Question, amendment agreed to.

Lord Belstead moved Amendment No. 214: Page 89, line 3, at end insert—

  1. (a) in relation to England and Wales, an authority who are a local authority for the purposes of the Local Authority Social Services Act 1970; and
  2. (b) in relation to Scotland, an authority who are a local authority for the purposes of the Social Work (Scotland) Act 1968.").

The noble Lord said: My Lords, for the same reason, I beg to move.

On Question, amendment agreed to.

Lord Belstead moved Amendment No. 215:

[Printed 16/10/85; col. 630.]

The noble Lord said: My Lords, I spoke to this amendment with Amendment No. 149. I beg to move.

On Question, amendment agreed to.

Following is the text of the amendment (No. 215): Page 89, line 43, at end insert ("and in sections 86 to 89 of this Act include references to London Regional Transport in relation to any exercise of their power under section 3(2) of the London Regional Transport Act 1984 (contracting-out powers) which by virtue of section (Co-operation between certain councils and London Regional Transport) (3) of this Act is subject to those sections.").

Lord Monk Bretton moved Amendment No. 216: After Clause 85, insert the following new clause:

—.(1) This section shall have effect for the purpose of enabling the Secretary of State to apply special provisions to local services on a particular route, if this becomes necessary in order to secure better value for money from the expenditure of a local authority on public passenger transport. (2) On application made by a relevant authority within four years from the passing of this Act, the Secretary of State may make an order under this section. (3) An order under subsection (2) above shall either
  1. (a) specify; or
  2. (b) within such lengths of road and subject to such other limitations if any as the Secretary of State may think fit to impose, authorise the relevant traffic commissioner to specify;
 times and places at which no local service (except an exempt service) shall have a stopping place. (4) the Secretary of State shall not make an order under subsection (2) above unless he is satisfied—
  1. (a) that in order to meet reasonable public transport requirements within their area, the relevant authority are necessarily incurring under Part IV of this Act expenditure on service subsidies which unreasonably exceeds their equivalent expenditure before the passing of this Act;
  2. (b) that the provisions of the order will not unreasonably affect the interests of any operator or prospective operator of a local service or of any person using or wishing to use such a service.
 (5) In determining for the purposes of subsection (4)(a) above what are reasonable public transport requirements in any area, the Secretary of State shall have regard to the services available in that area before the passing of this Act, taking into account any changes in relevant circumstances. (6) An order under subsection (2) above shall remain in operation for three years, and notwithstanding the provisions of that subsection may be renewed for such consecutive periods not severally exceeding three years as the Secretary of State on application by the relevant authority may determine. (7) In this section—

The noble Lord said: My Lords, in moving Amendment No. 216 I should like also to speak to Amendment No. 277. Amendment No. 277: Clause 106, page 111, line 26, after ("6") insert ("or (Special provisions for local services) (3)")

During the summer the Association of County Councils have maintained their view that a reserve power for the protection of subsidised bus routes is necessary. They have sought to modify its nature to make it more acceptable than that set out in the Committee stage amendment. In the meantime may I say that I know that in Kent, Surrey and Sussex it seems virtually impossible to find a Conservative county councillor who is not in support of this amendment. A number, particularly from Kent, think it rather less than the minimum. I cannot really accept, as did my noble friend Lady Carnegy on Monday, that they can all have been brainwashed by the officials.

Conservative councillors know very well that they are elected to get good value for money. They attach great priority to this and they watch it. They want this Bill to succeed because they recognise the considerable scope that it offers for savings. We must also recognise that they are very much at the sharp end of all this. They are close to what is going on and to the preparations for the day that the Bill becomes law. I think that we in this House should heed their view—we owe them that. They feel it vitally necessary to include a reserve power—only a reserve power—which can if necessary, be called into action to give some selective protection to subsidised routes. They remain adamant that there are dangers from creaming off which could unbalance these routes to no public advantage. Perhaps I should try to give a sketch example of what I mean.

Let us suppose that there are a couple of villages just off a main route which involve a detour. They add 10 minutes to the final destination time of the bus. The council makes an arrangement for this at reasonable cost. Later another operator creams off by avoiding the detour. The cost of serving the two villages rises, the local authority finds difficulty in meeting it and the service goes. This may be something of considerable advantage to those who gain 10 minutes on their route, but is is gained at the expense and severe deprivation of others, and we have a duty to avoid serious cases of this kind. At any rate, we have continued with this amendment so that serious cases of public deprivation, particularly in rural areas, can be dealt with.

The amendment has been much altered since Committee stage. The reserve power is entirely in the hands of the Secretary of State to use or not, as he wishes. Subsection (1) is merely a preamble. Under subsection (2), a local authority may only apply to the Minister for protection for a route within the first four years after the passage of this Bill. Therefore this is not a permanent provision; I should emphasis that it is only temporary, for four years.

Under subsection (3), the Minister can either simply specify the length of road concerned, leaving the protection details to be worked out by the traffic commissioner, or else he can spell out the full details himself. Those details will include the time of day and the date upon which competition should not extract revenue from the route.

Under subsection (4)(a) the local authority must show that it has necessarily to pay significantly higher subsidy than before. I emphasise the word "necessarily" because we wish to exclude constructive rigging of this altogether. If that had taken place, it would be a ground for rejection of an application. Under subsection (4)(b) the local authority must prove that an order would not unreasonably affect operators or the travelling public. We believe this to be a highly restrictive provision. It is much more difficult for a local authority to prove that negative than to prove, as with present road licensing, that a new service would be against the public interest.

Subsection (5) simply states that changes in local circumstances must be taken into account; such matters as population. Subsection (6) states that an order shall last for three years and can be extended for a period of up to a further three years. Subsection (7) has various definitions in it but one vital point is that the power operates now only after both the commercial and subsidised services are in place: in other words, after deregulation. It will not therefore get in the way of the tendering operation in the way that the previous amendment which I moved at Committee stage would have done. We were criticised on that aspect and the point was taken. This is really an enabling clause. It would give the Minister a discretion which it was felt the Government would wish to have very closely defined. We have tried to do that.

If I may say a few words about the views of the public, the operators and county councils, then I can quickly reach a conclusion. We must remember that the public have to produce public money, whether it is well spent or badly spend—and they would prefer it to be well spent. While an order of the kind proposed under the amendment may be an inconvenience to some passengers, no order may mean no service at all for others. To me, some pragmatism over difficult cases of this kind is both appropriate and in the public interest.

The amendment appears to be welcomed by operators and potential operators. When tendering for a subsidised service they would like the prospect of some protection against the totally unforeseen. For instance, there could be some maverick intervention of the kind that might happen in the first few years after deregulation, before people learn as much sense as they will do later. I bear in mind that we want the maximum number of potential operators. If this amendment encourages them to come forward, then so much the better.

3.45 p.m.

I shall now say a word about the viewpoint of the county councils and their problems. The Government's view that, overall, loss of cross-subsidy will be made good by the cost savings of competition is well understood and accepted. But although county councils agree with that overall conclusion, they have some reservations that in particular areas such may not be the case. Many of those areas will be under their regime. They fear the consequences very much because of the constraints on local government finance.

Experience with co-ordination and tendering under the 1980 Act has established that there is most scope for savings within the urban areas and considerably less scope in rural areas. I believe that is now a generally accepted fact. In any event, that is very much the view of the county councils. They consider that savings in rural areas depend very considerably upon the success of co-ordination, particularly coordination with educational transport. The shire counties' total bus subsidy at present is £94 million. For education they are paying out £196 million, and one should note the size of that expenditure. For social services transport they are paying out £44 million. It is critical to the economy of a county council to be able to control all three because they tend to be interrelated, and it is the overall result that counts finally.

To summarise, although I can enlarge a good deal more on the difficulties of county councils, there is a lot of evidence about these matters, but there has been considerable disagreement as to what it proves. One point we can be sure of is that it is pretty idle to try to estimate what the loss of cross-subsidy will be until it happens; it is only then that we shall know. It is therefore uncertain how much subsidy supported services will need. It is uncertain whether there will be variations between different areas. I believe that there will be.

Those are the portents—the straws in the wind. I believe that they are a warning; a warning that it is prudent that there should be a reserve power if we can devise one. If such a power is not genuinely needed then it need not be implemented. I believe it is up to my noble friend and the Government to prove why there should not be such a safety net in the Bill. I hope that my noble friend on the Front Bench will look most sympathetically upon this amendment. If it has imperfections, perhaps he will consider polishing it further if necessary, or perhaps putting down an amendment of his own—provided he undertakes that the principle is accepted that there should be a safety net.

I also ask my noble friend to consider separately if there are great difficulties with this amendment protection for the rural areas only including those areas—and this is important—in the neighbourhood of large conurbations, where it is felt that some of the difficulties over services may be greatest. Failing that, it might be right and necessary to test the views of the House. I hope that it will not be necessary. Nevertheless, I beg to move.

Baroness Vickers

My Lords, I beg to support this amendment. I would be guilty of intense ingratitude if I did not thank my noble friend the Minister for his ready help in the past. This amendment is not meant to cause him any further troubles but to help him decide what is right for the future. The amendment is not meant either as a back door way to frustrating the Secretary of State and his intentions regarding this Bill. It enables a local authority to apply to him for the use of powers to specify a route or routes where protection against competition would apply.

If the optimism of the Secretary of State over the impact of the Bill in rural areas proves correct, doubtless it will not be necessary to invoke the provisions of this amendment. However, without this amendment there appears to be nothing in the Bill to enable something to be done to deal with the problems which may face rural services. The Government have already accepted the principle of provision of powers to intervene where general application of legislation may cause local problems. This, I suggest, is through the rural area designation process in the Housing Act 1980. Also, of course when I replied to a point raised by the noble Lord, Lord Mottistone, the other night on the Transport Act 1981 I mentioned that the words, "interests of the public", were put in, and in the Housing Act they were given the right to buy. I believe the Secretary of State could accept the kind of principles in both those Acts.

The Bill is largely unprecented because it is without support of any Royal Commission, with the exception of some disputed trial areas. It is also without the support of an inquiry, and so the deregulation represents a leap in the dark. In view of the fact that this Bill deals with an organised majority industry, with vital services for a large part of the population there should have been more inquiries before it was brought to this House.

I agree with the noble Lord who has just spoken that we need a safety net. I should like to suggest that, as this Bill has been carefully and cleverly drawn to ensure there is no possible way of its being tampered with by the local authorities, he might accept this amendment which goes some way to help those who will be in need in the future.

Baroness Faithfull

My Lords, very briefly, I should like to support this Bill. The Women's Institute in Oxfordshire has done a survey of the needs of the county and of the small villages throughout Oxfordshire. As a result of having read the survey closely I, too, should like to support this amendment.

Lord Alport

My Lords, on behalf of the Essex County Council perhaps I may say that I understand it is strongly in support of the amendment. I hope my noble friend and the Government will consider more carefully than they appear to have done up to now the experience and interests of those who are democratically elected to represent us in the various counties which have already been mentioned in this debate.

Lord Nugent of Guildford

My Lords, the whole of the Conservative Benches seem to be in favour of this amendment. However, I should like to make one or two points about where, although I sympathise with the wish of all local authorities to see some sort of safety net, there are certain aspects of the amendment which seem to me to go much too far.

First of all, this Bill sets out to make a free market in bus transport in the belief that private operators will have something to offer in the way of better services, in many cases at lower rates and at lower public cost. That is the principle of the Bill which has been agreed, and my noble friend Lady Vickers made some comments about the principle that she did not agree with. However, I think that all noble Lords on all sides will agree that at this stage of the debates on the Bill we really cannot go back to the general principle.

So we turn to this amendment, which my noble friend Lord Monk Bretton has explained in fair terms of what the local authorities want. But let us make it quite clear to start with that this amendment is not for the assistance of the rural areas only; it covers the whole country. This is very wide indeed. It means to say that if this amendment were approved any local authority where there was a subsidised service would have the right to make the submission as set out in the amendment, and to make an application to the Secretary of State where that local authority considered that it could secure better value for money for the expenditure concerned. That goes right to the very heart of the Bill.

We must be realistic about this. Nearly all local authorities in the country have been campaigning against this Bill, flat out, for the last 18 months. All of us have been besieged by document after document. Is it really reasonable to expect that none of those would say, "Well, here is our chance; as soon as this Bill is on the statute book this gives us an opportunity to make an application in any case where there is a subsidised authority. After deregulation, after tendering, we can apply to the local authority and say we do not consider this is good value for public expenditure"? That is what this amendment does. I am sure my noble friend did not intend to go so far as that, but this is what it does. While I sympathise very much with him about the anxieties of local authorities, especially in some rural areas, that covers a lot, and the ferocity of the campaign of many of the urban authorities against the Bill is a fair indication of what the Secretary of State will be besieged with.

How on earth will the Secretary of State deal with all these applications if he gets them? We are told that in these subsections, particularly subsection (4), that he shall not make an order … unless he is satisfied that the relevant authority are necessarily incurring … subsidies which unreasonably exceed their equivalent expenditure and that the rights of the travelling public (subsection (4)(b)) will not be unreasonably affected. For the Secretary of State to be brought in to deal with goodness knows how many cases seems a strange piece of legislation. If Parliament decides that the principle that the bus service should best be operated on a free market system to bring the private operator into existence, and puts in this provision, surely in a word this is saying that we are doubtful whether this will work and therefore the Secretary of State must prepare this complete system of appeal which could be used in every subsidised case. That is what it does.

Lord Alport

My Lords, does my noble friend Lord Nugent of Guildford realise that the county councils are very certain that the scheme is not going to work? That is the reason they want this reserve position.

Lord Nugent of Guildford

My Lords, I am most grateful to my noble friend Lord Alport for making that point again, but he is opposed to the Bill. Parliament decided on Second Reading, both here and in the other place, that the principle is agreed. Therefore, at this stage it is out of order to argue against the general principle of the Bill. My noble friend's point is the one I am concerned with: that this amendment could go to the very heart of the principle of the Bill. My noble friend has been good enough to clarify that point for me.

I really do not think it is reasonable at this stage for my noble friend Lord Monk Bretton to ask the House to agree to a safeguard of this kind which has such enormous implications. If it had been possible to define the kind of safety net he wants for the rural areas in such limited terms that that was all it did, I am bound to say I would have a great deal of sympathy. I live in a rural area and I know what the bus services do and do not do. But this goes far beyond that.

I hope that my noble friend will say much more than I can. There are aspects of this amendment which really cannot be accepted at this stage. I say to my noble friend that if he still wishes to pursue this line he really ought to think again.

Lord Underhill

My Lords, the noble Lord, Lord Nugent of Guildford, is endeavouring to say to the House that because we have passed the principle of the Bill, therefore we should do nothing to ensure that there is a safety net or breakdown anywhere. We must challenge the Government. Are the Government thoroughly satisfied there will not be a breakdown in any area, on any service, on any route? They cannot say that. Therefore, if such should happen, what do the Government propose to do?

The amendment offers a way out. It is a reserve power and a safety net. As it offers a way out without in any way affecting the principle of the Bill the House should follow the amendment put forward by the noble Lord, Lord Monk Bretton. After trying to demolish the amendment the noble Lord, Lord Nugent, quotes the essential subsection of the amendment whereby the sole power will still reside with the Secretary of State. The Secretary of State will decide whether he wishes to do anything and what should be done. Therefore, much of what the noble Lord, Lord Nugent, said is, frankly, a red herring. He is endeavouring to set aside the vital safety net contained in the amendment.

4 p.m.

Lord Tordoff

My Lords, may I, too challenge the noble Lord, Lord Nugent. I am sorry to involve myself in what is clearly a private party on the Government side of the House this afternoon, but he does need to be challenged.

It seems to me that the noble Lord destroys his own argument when talking about the very large number of applications which will come forward. If the system is going to work as well as he says, where on earth is this large number of applications to come from? If there is a large number of applications, that would indicate that the Bill is not working. The fact that Parliament has passed a Bill and that at Second Reading the principle has been established concerning the direction in which the Bill is going, does not necessarily mean that it will work. Only time will tell. Votes in Parliament will not ensure that. They will ensure the way that the legislation is to go but they will not ensure that the legislation will work. All noble Lords on the Government Back Benches who have been in Government know that that is perfectly true. They have all been involved in either supporting or opposing Bills which have gone through Parliament and which, in the event, have not worked. One can think of the local government reorganisation which we have just reversed. That was intended to work, but did not, and the Government have found it necessary to introduce further legislation.

What the amendment is saying—and I congratulate the noble Lord, Lord Monk Bretton, on introducing it and on the way in which he did so—is that there may well be circumstances in which the Bill will not work. Even with the greatest possible faith in the Government's ability to produce a new bus system there may be instances when it will not work. Some mechanism is necessary to make sure that transport services are preserved on such occasions. If there is not a mechanism which can be applied quickly to fill the gap, then once bus services disappear in the rural areas they will not return. To reintroduce services that have decayed is almost impossible over the long term. I beg the Government to take this amendment seriously. It is not an attack on the principle of the Bill. It is a genuine attempt to provide a safety net.

Lord Shepherd

My Lords, it may well be that the amendment is not an attack upon the principle of the Bill, but let us be very clear that if we were to pass it we would at least be expressing what many of us who have taken part in the debate feel is a very great concern on the consequences of deregulation and, in particular, the loss through cross-subsidisation in the very early months.

Let me remind the House of what I said on Second Reading, speaking from my knowledge of what my old company, the National Bus Company, received, operating mainly in the shires, where much of the difficulty will exist which the noble Lord, Lord Monk Bretton, is expecting. We received under Section 1 grant for socially desirable but unprofitable services the sum of £67 million a year. The degree of cross- subsidisation conservatively estimated from our own examination in the National Bus Company was that we were cross-subsidising around £120 million a year. In certain parts of the country the difference between what we received from Section 1 grants and what we were able to maintain by cross-subsidy was greater than in others.

I can envisage a number of counties which will be much more severely affected than others—particularly the northern counties. I suspect that the main burden of deregulation—at least the initial consequences—will be felt in the counties, shall I say, just south of Buckinghamshire, and possibly further south.

The noble Lord mentioned an example of the difficulty where a profitable service is running between A and B and the county asks that the service should be extended, or retained, between B and C. He asked what would be the consequences if a competitor were to come in on the route from A to B which is the part of the route which provides the cross-subsidy. But that is only one element of cross-subsidy. Cross-subsidy permits the running of essential services m the countryside on Sundays. Anyone with experience of the bus industry knows that nobody could ever run buses at a profit on Sundays—not even if run at cost, and certainly not in the counties. Therefore, Sunday is always cross-subsidised. That also applies to early morning and late services. Therefore, it is not just a question of cross-subsidy for the mere provisional extension of routes, it is the maintenance of all the various types of services which the community has relied upon.

What the noble Lord, Lord Monk Bretton, has done, supported by his colleagues who have spoken, comes rather late. I do not say this to him but I do say it to others, because the basic fears we have had in regard to this Bill are now being expressed. These are fears which I know have existed within the counties. I find it a matter of regret that the voice of the counties has not been heard on this matter. I will be frank. From the operator's point of view the amendment is of very little benefit. Under the Bill an operator will be free to make his own commercial judgment. The amendment is dealing with the anxieties of elected representatives of the people who are today gravely concerned about what road passenger services will be available after deregulation. At least the amendment provides a safety net. How it would work, I do not know. The noble Lord, Lord Nugent, put his finger on it. I think there will be a vast number of applications made if the amendment is passed. But, if that is so, that must be the extent to which the damage to the rural bus services is likely to arise as a result of the Bill. That is a matter for the Government.

If the elected members of the counties are genuinely asking for a safety net, then even at this very late hour, although I do not see any gain at all in the Bill from the operator's point of view—in fact I can see aspects which will prove detrimental to their interests—it would be very foolish not to support that view and to press upon the Government the proposals in the amendment. Whether the amendment is perfectly drafted is neither here nor there; but the principle is there and if your Lordships' House feels that way then we should support the amendment.

Baroness Carnegy of Lour

My Lords, I should like to ask your Lordships to look a little more carefully at this amendment and at what it is actually suggesting. I am sorry that my noble friend Lord Monk Bretton gained the impression that I thought that all Conservative councillors were brainwashed by their officials. I know too many who have never been brainwashed by officials, let alone frequently brainwashed. I certainly do not think that. I agree with my noble friend Lord Nugent that this looks like a continuation, right to the end, of a campaign against the Bill, but at the same time, having listened very carefully to what my noble friend Lord Monk Bretton has said I appreciate that there has been a genuine attempt to try to find a way of doing something if the Bill and its effect fail.

Yet I should like to ask your Lordships to look carefully at what the amendment suggests. As I understand it—if I am wrong I am sure that my noble friend on the Front Bench will put me right—the suggestion is that the market, having been given a chance, as the Bill proposes, and the local authority having decided that it must put out to tender some subsidised routes, then, if in spite of all this, it seems that the authority will have to spend more money than previously it can ask the Secretary of State to protect some of the routes for which independent operators have applied, whether they are routes to be run without subsidy or with subsidy, in order to protect them from other people coming and stopping on those routes and taking passengers from them. That is what is being suggested. It is also being suggested that the person who decides that protecting the routes would save public money is the Secretary of State.

Anybody who has had anything to do with bus routes, whether in a local authority or as an operator, knows of the enormous intricacy in the interrelationship of routes. In order to make judgments you have literally to know the bus stops on the ground. You have to decide whether one route being protected will save money by bringing more people on to unsubsidised routes, or whether you will be able to pay less subsidy on a given route. It is immensely complex. Yet the person to decide these questions is to be the Secretary of State, doubtless in consultation with the local authority concerned which will put its point of view.

That is one point. Another factor is that should the Secretary of State decide to protect the routes, he can continue doing so under paragraph (6) of the amendment. He can make an order which will remain in operation for three years and which "may be renewed for such consecutive periods not severally exceeding three years". He has to act from a position which is really very remote, and he can so act with any route which has been applied for before November and before deregulation day. So as I understand it, there will be many routes which are not subsidised and others which are subsidised. The Secretary of State has to make that decision, and it seems to me that it is a very difficult decision to make. I query the extent to which the Association of County Councils has been able to identify what is possible for him.

4.15 p.m.

Then I should like to ask my noble friend, when he sums up on this debate, to tell us what is to stop a high-spending authority spending more on its subsidies in the initial stages than it did before and pointing out to the Secretary of State that it is doing so, making a very strong case for the protection of certain routes and getting that situation perpetuated three years by three years? The Secretary of State will find such an argument very hard to refute, if the authority has spent more in the first place.

Reading the amendment, it seems to me—and I may be quite wrong, and, if so, I am sorry—that the suggestion is one which simply will not work. I do not know whether there is a safety arrangement that might work. I hope it will not be necessary to have a safety net. I am one of those people who think that the Bill is almost certain to create a situation which, though not perfect, will be better than the present situation, which is very bad, certainly in rural areas, but it seems to me that this amendment is almost impossible to implement. Unless we can be sure that it might work, it really should not be accepted by this House.

Lord Mottistone

My Lords, I should like to support the principle of this amendment, though I quite understand and agree with my noble friend who has just spoken about the shortcomings of the amendment as it stands. I speak really from the point of view of people on the Isle of Wight who suffer from having a monopoly operator. I have noted that the noble Lord, Lord Shepherd, said that on the whole operators might be at a disadvantage if this amendment were to be accepted. It is for that kind of reason that I support the principle of it, because I foresee that there could be situations in which the operator, particularly if he starts from the advantage of a monopoly position, could manipulate matters, and he might indeed be able to bamboozle a county council into taking actions, which may be uneconomic actions, which it would not particularly want to do if it were better skilled at business matters. In the nature of things, county councillors and their officials are not businessmen, because they are not paid to be businessmen, and officials in an organisation do not know such things. It could well be that in the early stages, when this Act is working itself through, there will be occasions when people might take decisions at county council level which will not be to the advantage of their financial position nor therefore of their ratepayers.

Therefore it seems to me that it is sensible to have some kind of an amendment which seeks to do what subsection (1) of the amendment says is the aim of this section. I quite see that the detail may be too complicated, and indeed that it may have the wrong kind of effect, such as my noble friend Lord Nugent has suggested. I would hope that perhaps my noble friend the Minister, when he comes to reply, will be able to say to us that he agrees that some kind of a safety net is necessary, which is very much under the control of the Secretary of State, as proposed here; that he will take this amendment away and, at the next stage of the Bill, will present one of his own which meets the principle involved yet avoids the shortcomings that have been pointed out by certain of my noble friends. He may perhaps point them out himself. That is what I hope will happen, and I hope very much that in those circumstances my noble friend Lord Monk Bretton will feel that he can accede to the possibility of my noble friend producing a replacement for his amendment.

Lord Henley

My Lords, I wonder whether I may add a few words to assure the Government that not everyone on these Benches is in favour of this amendment. I certainly hope that the Government will not accept it and that the House in general will reject it. We have spent a long time—six days in Committee and now three on Report—discussing the principles of the Bill. As I think my noble friend Lord Nugent of Guildford said, this amendment seems to be bringing cross-subsidy principles in by the back-door. On top of that, I am not sure that, as drafted, the amendment would achieve what it sets out to achieve. The drafting is thoroughly suspect, I imagine. For those reasons I hope that the House will reject it.

Lord Sandford

My Lords, I hope that my noble friend on the Front Bench will take the advice of my noble friend Lord Mottistone in dealing with this amendment. It is not an amendment which strikes at the heart of the Bill, as my noble friend Lord Nugent sought to suggest. The principle of the Bill is that by introducing competition and private enterprise we shall have a happier state of affairs in the public bus services than we have now. That is certainly something to which the House has agreed. The Bill is not drafted as though private sector competitive operations will meet all the social needs of the bus travelling public. That was never claimed. It recognises that there will be gaps left when all that the private operators feel they can do has been done by registering their services, and they will be filled by tendering for subsidy.

It is conceivable and entirely within that philosophy that the result of that tendering for subsidy will be to incur greater costs for some authorities than are incurred at the moment, and it is that contingency for which this amendment provides. But it would be very surprising if a private member succeeded in drafting an amendment perfectly to meet that rather complicated contingency which we are all considering. I think that much the best thing that my noble friend could do, particularly as we are now at the Report stage, is to accept the principle which had been clearly made out, undertake to take the matter away, deal with it and come back to us with a Government amendment on Third Reading.

Another contingency which I envisage as being likely to occur if that is not done is that a number of district councils, finding that they are involved in meeting social needs for buses in the remote rural areas, and not wishing to continue to pay subsidies which they regard as too heavy, will form separate small bus companies of their own, below the threshold of 10, which will exempt them from the private company arrangements in Clauses 63 and 64, and meet those social needs by operating their own small bus companies in the public sector. That would run flat counter to the general intention of the Bill, and it is not a development which I should have thought that my noble friends on the Front Bench would welcome, and nor should I.

For those and a number of other reasons which I do not think it is necessry to go into, I hope that my noble friend will accept the principle behind the amendment and come back with a Government amendment on Third Reading.

Lord Denning

My Lords, may I say just one thing? Even if we accept the principle, so called, of the amendment is seems to me quite hopeless. As I read it, the only order that can be made comes under subsection (3): An order … to specify … times and places at which no local service … shall have a stopping place". That is the order than can be made. On such an order it seems to me quite impossible to implement the principle suggested. So far as concerns the drafting, I am afraid that it does not carry out the objectives about which we have heard today, so I would oppose the amendment.

Lord Belstead

My Lords, I am interested in what the noble and learned Lord, Lord Denning, has just said. Perhaps I may say in reply to the amendment that I recognise that my noble friends Lord Monk Bretton and Lady Vickers have been quite consistent in showing their concern for subsidised bus services during the passage of the Bill through your Lordships' House.

My noble friend Lord Monk Bretton originally tackled the question in the context of rural bus services at the Committee stage. But let us be clear: this amendment is not a simple provision to protect country bus services, and it goes very much further than protecting subsidised services. It is an amendment which worries me very much, as I think it worried my noble friend Lord Henley who spoke a few moments ago. Let me add to what he said and explain the cause of my worries.

First, the purpose is to enable the Secretary of State to make orders to secure better value for a local authority's public transport expenditure. There has been a certain amount of criticism during this debate of the Bill once again in quite a fundamental way. If I may throw the ball back for just a moment, here is an amendment being put forward which makes no mention at all of securing better services for the travelling public or even for some particular sections. It is true that later on the clause says that an order shall not be made if its provisions could unreasonably affect the interests of other operators or passengers; but those interests are clearly dependent on the original application of the local authority which is on quite other grounds.

I find especially worrying the definition of the bus services which could be protected if just for once the noble and learned Lord, Lord Denning, was not correct—which I suspect is not the case—and this provision could be brought into effect. Let us look at the definition of the bus services which could be protected under these orders. Incidentally, by "protected" the amendment makes it clear that it means that no other local service would be able to pick up or set down passengers from specified stopping places at specified times. Even if the noble and learned Lord is right, the intention is clearly that there shall be protection.

This is not just protection for subsidised services, if I may ask your Lordships to look at the Marshalled List. It would be protection for any bus service at all which happened to be registered before deregulation day, which we have now put back so that it will be at the beginning of November 1986. That is the effect of the last two lines of the amendment on page three of the Marshalled List. Is that really what my noble friend intends—to have a Bill encouraging the registration of new services but then setting those services in stone by order if they happen to be registered within the next year, while of course giving no special protection to any other services registered after the autumn of next year?

This amendment is not saying, "Let us have some safety net for services in rural areas or anywhere else". We are being invited to pass an amendment with a provision in it which would create monopoly bus services, if that can be brought into effect, by law—not only subsidised services but on a random basis—provided they have been registered within a year from now. Then of course those commercial services would be able to charge what they liked to their passengers with no one able to compete against them. Of course I took seriously what my noble friend Lady Faithfull said about the views of the Women's Institutes. But, my goodness me, there would not be much of an outlook for their members throughout the country, or indeed for anyone else, whether in the town or in the countryside, in those circumstances.

I feel that I must say one thing more. This amendment could be invoked comparatively quickly. Certainly, it could be done only a year after the Bill comes into effect, for subsection (2) simply provides that an application needs to be made within four years of the passage of the Bill. But once an order is made, how on earth is it unscrambled? How does any bus operator who feels that he can provide a better service at a keener price with advantage to people get admitted to any of this wide range of routes that would be protected, as is the intention under the amendment? True, there is a three-year renewal period. But as my noble friend Lady Carnegy so rightly pointed out, no-one except the local authority is allowed to make the original application and no-one except the local authority is allowed to have a say about the renewal of the order.

4.30 p.m.

With respect to my noble friends, this is not a safety net clause of the kind with which we are familiar in the revising work that we carry out in this House. As my noble friend Lord Nugent of Guildford rightly said, it is a provision to return to the present system. This was confirmed by the speech of the noble Lord, Lord Shepherd. The noble Lord, Lord Shepherd, made a sterling defence of the system of cross-subsidy. But it is just that system that the Government believe has not served the travelling public well. It is just that system that this amendment attempts to allow to be restored but with the extraordinary addition of giving monopoly protection to any commercial services provided that they fall within an order and that they have been registered within the next year.

I cannot believe that this would be good for passengers. I do not believe that it would be good for bus staff who want more and not less work. It would not be good for operators. And, in the end, I do not think that it would be good for local authorities. Most of all, I really do not think that it would be much of an advertisement for the revising work of your Lordships' House. I respect the concern of both my noble friends in the matter, but I do not believe that this can conceivably be an amendment that would work with any semblance of fairness.

Lord Monk Bretton

My Lords, before my noble friend sits down, can he say whether or not he is prepared to do something towards this end, perhaps over the rural services alone?

Lord Belstead

My Lords, I am always ready to talk to my noble friend. But I cannot talk to my noble friend on the basis of this amendment because it is so far away from any practicality. So far as some scheme for rural services is concerned, this is a matter that my noble friend and I went into in great detail with other noble Lords at Committee stage. My noble friend withdrew his amendment on very much the same worries that I have been expressing today.

Lord Monk Bretton

My Lords, I must try and say a few more things about this matter. A principal difficulty with the Bill is, of course, that in a perfect world it would be satisfactory without an amendment of this kind at all. What makes the world imperfect and produces the need for an amendment such as this is the constraints of local government finance. It is for that reason that one needs to be pragmatic in certain cases right on the fringes. It is a difficulty that is inevitably with us.

I should like to comment briefly on the fact that I hope very much that the type of order that could only be applied for during the first four years following the passage of the Bill would not be considered as an attack upon its general principle. I had hoped, indeed, that the amendment would only help in the case of minor problems when difficulties arose in the relatively long grass of the subsidised areas. As for the Secretary of State being overwhelmed by applications, we had thought that if the Secretary of State published for local authorities some more precise guidelines of what he would or would not accept, he should avoid being inundated with the kind of request that he does not wish to accept. Obviously, what is shakily justified he would reject very smartly anyway.

The amendment cannot, I believe, affect a service established before deregulation day. My noble friend said that he was concerned about these orders setting matters in stone. But if another operator did come along and a better solution presented itself, the original order would not, I think, be extended. So, although it might last for a time, it would last no longer than that and would not be renewed. I am sure that it would be in the interests of everyone to get rid of it as soon as possible.

I am very much at a loss as to what to do. I am not sure that my noble friend has given an undertaking that he will take this away and consider it so that we shall have something back. I am very much in the hands of the House as to whether there should be a Division on this amendment or not.

Lord Stoddart of Swindon

My Lords, press it and give us a chance to test the mood of the House.

Lord Monk Bretton

I do not want to spoil the rural issue. I would like to preserve that. It may be that there is a better case for it and it is easier to do. However, I think that perhaps we should show an opinion on the amendment. I think that perhaps I should test the mood of the House.

4.38 p.m.

On Question, Whether the said amendment (No. 216) shall be agreed to?

Their Lordships divided: Contents, 94; Not-Contents, 113.

DIVISION NO. 1
CONTENTS
Airedale, L. Kagan, L.
Alport, L. Kennet, L.
Amherst, E. Leatherland, L.
Attlee, E. Llewelyn-Davies of Hastoe, B.
Aylestone, L. Lockwood, B.
Barnett, L. Longford, E.
Beaumont of Whitley, L. McIntosh of Haringey, L.
Blease, L. McNair, L.
Boston of Faversham, L. Mais, L.
Bottomley, L. Mellish, L.
Brockway, L. Mishcon, L.
Bruce of Donington, L. Molson, L.
Burton of Coventry, B. Monk Bretton, L. [Teller.]
Carmichael of Kelvingrove, L. Monkswell, L.
Cledwyn of Penrhos, L. Monson, L.
Collison, L. Morton of Shuna, L.
Crawshaw of Aintree, L. Mottistone, L.
Cudlipp, L. Moyne, L.
David, B. Mulley, L.
Dean of Beswick, L. Nicol, B.
Diamond, L. Oram, L.
Donaldson of Kingsbridge, L. Pender, L.
Dowding, L. Rea, L.
Elwyn-Jones, L. Ritchie of Dundee, L.
Ewart-Biggs, B. Rochester, L.
Faithfull, B. Russell of Liverpool, L.
Falkland, V. Sainsbury, L.
Fisher of Rednal, B. Sandford, L.
Fitt, L. Shepherd, L.
Foot, L. Shinwell, L.
Gallacher, L. Silkin of Dulwich, L.
Gladwyn, L. Somers, L.
Glenamara, L. Stallard, L.
Graham of Edmonton, L. Stamp, L.
Hampton, L. Stedman, B.
Harris of Greenwich, L. Stewart of Fulham, L.
Hatch of Lusby, L. Stoddart of Swindon, L.
Hayter, L. Taylor of Blackburn, L.
Hooson, L. Teviot, L. [Teller.]
Houghton of Sowerby, L. Tordoff, L.
Hylton-Foster, B. Underhill, L.
Ilchester, E. Vickers, B.
Irving of Dartford, L. Wallace of Coslany, L.
Jacques, L. Wells-Pestell, L.
Jeger, B. White, B.
Jenkins of Putney, L. Willis, L.
John-Mackie, L. Wise, L.
NOT-CONTENTS
Ailesbury, M. Broxbourne, L.
Aldington, L. Buckinghamshire, E.
Alexander of Tunis, E. Butterworth, L.
Allenby of Megiddo, V. Caithness, E.
Ampthill, L. Cameron of Lochbroom, L.
Auckland, L. Carnegy of Lour, B.
Belhaven and Stenton, L. Coleraine, L.
Belstead, L. Cox, B.
Bessborough, E. Craigavon, V.
Blake, L. Cullen of Ashbourne, L.
Boyd-Carpenter, L. Davidson, V.
Brabazon of Tara, L. De Freyne, L.
Brougham and Vaux, L. Denham, L. [Teller.]
Denning, L. Newall, L.
Drumalbyn, L. Nugent of Guildford, 1
Duncan-Sandys, L. Orkney, E.
Ebbisham, L. Orr-Ewing, L.
Ellenborough, L. Pennock, L.
Elliot of Harwood, B. Penrhyn, L.
Elliott of Morpeth, L. Plummer of St Marylebone, L.
Elton, L.
Erroll of Hale, L. Portland, D.
Foley, L. Quinton, L.
Fortescue, E. Reay, L.
Fraser of Kilmorack, L. Renton, L.
Gainford, L. Rochdale, V.
Glanusk, L. Rodney, L.
Glenarthur, L. Romney, E.
Gray of Contin, L. Rugby, L.
Gridley, L. St. Davids, V.
Hailsham of Saint Marylebone, L. Saltoun of Abernethy, Ly.
Sanderson of Bowden, L
Halsbury, E. Sandys, L.
Hankey, L. Simon of Glaisdale, L.
Hardinge of Penshurst, L. Skelmersdale, L.
Harvington, L. Strathcarron, L.
Henley, L. Strathspey, L.
Hives, L. Sudeley. L.
Holderness, L. Swinfen, L.
Hood, V. Swinton. E. [Teller.]
Hooper, B. Terrington, L.
Ironside, L. Thomas of Swynnerton, L.
Kimball, L. Tranmire, L.
Kitchener, E. Trefgarne, L.
Lane-Fox, B. Trenchard, V.
Lauderdale, E. Vaux of Harrowden, I
Liverpool, E. Vivian, L.
Long, V. Waldegrave, E.
Lucas of Chilworth, L. Ward of Witley, V.
Lyell, L. Westbury, L.
McAlpine of Moffat, L. Whitelaw, V.
Mancroft, L. Windlesham, L.
Margadale, L. Wolfson, L.
Marley, L. Wynford, L.
Marsh, L. Young, B.
Merrivale, L. Young of Graffham, L
Mersey, V. Ypres, E.
Nelson of Stafford, L.

Resolved in the negative, and amendment disagreed to accordingly.

4.46 p.m.

Clause 86 [Obligation to invite tenders for subsidised services]:

Lord Brabazon of Tara moved Amendment No. 217: Page 90, line 4, leave out ("in respect of a local service") and insert ("under which a local service is to be provided").

The noble Lord said: My Lords, I beg to move Amendment No. 217 and, with the leave of the House, speak also to Amendments Nos. 225, 226, 267 and 268. Amendment No. 225: Clause 88, page 93, line 4, leave out ("respect of") and insert ("order to secure"). Amendment No. 226: Page 93, line 27, leave out ("respect of") and insert ("order to secure"). Amendment No. 267: Clause 100, page 107, line 37, leave out ("in respect of any service"). Amendment No. 268: Page 107, line 40, leave out ("on journeys on that service").

These are purely technical amendments consequential upon the change in the definition of agreement providing for service subsidies in Clause 61(10)(b) which was agreed at Committee stage of your Lordships' House. I beg to move.

On Question, amendments agreed to.

Lord Brabazon of Tara moved Amendment No. 218: Page 90, line 29, after ("(4)") insert ("(b").

The noble Lord said: My Lords, this again is a purely technical drafting amendment. I beg to move.

On Question, amendment agreed to.

Lord Stallard moved Amendment No. 219: Page 91, line 6, leave out ("solely").

The noble Lord said: My Lords, on behalf of the noble Lord, Lord Ennals, I beg to move Amendment No. 219. The House will know that the noble Lord, Lord Ennals, has been incapacitated for a few days and is not yet able to return. That does not please me too much because I have not had a chance to discuss this amendment with him, and I came to it with a fairly fresh mind. However, Amendment No. 219 seemed to me an important amendment for several reasons. The amendment is to leave out the word "solely" in Clause 86(7).

At the moment the duty of local authorities in undertaking tendering has been laid out quite clearly in a previous clause, Clause 61 (8) where it says: It shall be the duty of any council, in exercising or performing any of their functions under the preceding provisions of this section, to have regard to the transport needs of members of the public who are elderly or disabled.

That has already therefore been included in the Bill.

The part to which the amendment refers is in Clause 86(7): The authority issuing any invitation to tender under this section shall determine—

  1. (a) whether to accept a tender submitted in response to the invitation; or
  2. (b) which (if any) of several such tenders to accept;
solely by reference to what in their view is the most effective and economic application of the funds at their disposal.".

My first and immediate thought was that the word "solely" ought not to be included for grammatical reasons, if for no other. You cannot refer to "solely" and then go on to refer to: the most effective and economic application".

You can have one or the other, but you cannot have both.

When considering the matter I saw a copy of a letter which had been written by the noble Lord, Lord Belstead in reply to a letter from the chairman of the All-Party Disablement Group. The noble Lord, Lord Belstead, said in the letter: I can assure you this is not the case"—

in other words, we would not just be talking about the "effective and economic application". He went on to say: The emphasis here is not only on economy but also on effectiveness".

He separated the effective from the economic, but in the subsection to which I am referring they are qualified by the word "solely". I do not think that we can use the word "solely" in that context. Therefore, if for no other reason that that, I should have thought that the word should be deleted. I hope that the Minister will at least agree with me on that point.

Indeed, I should like to go a little further, because obviously there will be differences between myself and the Minister about: the most effective and economic application of the funds".

There is a major difference of philosophy. I would certainly never discuss the application of anything so far as the disabled, the mentally handicapped, the sick, the elderly and so on are concerned purely and simply on an economic basis. I would hope that we would all accept that there is a social cost as well as considerations concerning effectiveness and profitability when dealing with services for the disabled, and so on. In my view the words, the most effective and economic application

seem to say that if the price is right then it will be all right. That is not the only consideration and will never be the sole consideration as far as I am concerned. Therefore, that is another reason why I take the view that "solely" should not be in the subsection.

Moreover, the noble Lord, Lord Belstead, went on to say in his letter: In giving guidance to authorities on tendering we shall draw attention to the kind of specific steps which they can take to ensure that proper account is taken of these needs when sending out invitations".

I come back to my original point. If we are still talking about "solely" in connection with, the most effective and economic application",

then the next subsection, which is referred to in Amendment No. 221 in the name of the noble Lord, Lord Belstead, adds further considerations for the local authorities when discussing and considering these tenders. We have already qualified the situation with the word "solely". We then put in a separate subsection to add further considerations. It seems to me to be either bad drafting or a deliberate attempt to complicate the matter unnecessarily.

The case for the removal of the word "solely" should now be becoming clearer. The Minister went on to say in his reply: we do believe that it would be quite wrong to single out one particular aspect of the criteria".

I simply ask: why? Why is it wrong to single out one particular aspect, especially when that particular aspect has already been dealt with, mentioned and written into the Bill in Clause 61? Why is it wrong to mention that aspect if it is already there? Why should the Minister say that he thinks it is wrong to refer to a particular aspect, albeit that that particular aspect is already part of the Bill? It is at least arguable to say that there should be more than that consideration.

I understand that there is to be guidance, and that guidance was mentioned by the Minister in the reply of his which I have just quoted. I have been informed about a draft of the guidance, and I have had a quick glance at it. It points out that authorities may wish to indicate vehicle features which are needed—such as handrails, colour coding or seat positions—and it adds that authorities may feel that the safest course is to invite alternative tenders showing the relative costs of providing services with or without special features. That seems to me to underwrite my fears and those of disabled people themselves that it will be the price that will determine the type of service which is provided. It is no good the Minister saying, "Oh, we shall say this and we shall say that", when in the code of guidance it says that the authorities "may wish" and "may feel" that the safest course is to invite alternative tenders—in other words, to find out whether they can get a cheaper set of conditions applying to disabled transport and, if so, go for that one.

First, I do not think it wrong to single out a particular aspect, for the reasons which I have mentioned. Secondly, however well-intentioned the guidance may be—and it may not have been intended to have this effect—it certainly comes across that a major factor in the considerations by the local authorities under the guidance, the draft code of practice, will be cost; and that, of course, would worry all of those involved. Therefore, I hope that the Minister will accept that there is a case to delete the word "solely" from the clause. I beg to move Amendment No. 219.

Lord Somers

My Lords, I feel inclined to support the amendment. I would be the last person to hold that economic questions are unimportant. Of course one has to observe what is and is not financially possible. However, at present there is too widespread a tendency, in industry at any rate, to consider only what is cheapest to produce and not what is best. In this case, for instance, how about considering facilities for the public and whether of not there will be an improved form of transport provided? It would be a great pity if we were to determine the matter only on the question of how much it will cost—although, of course, as I have said, one must always consider that aspect. However, in my view, it should be, as it were, the last post to be passed. I therefore support the amendment.

Lord Tordoff

My Lords, I shall simply say that if the noble Lord, Lord Belstead, is serious about moving Amendment No. 221, then I am surprised that he is not moving Amendment No. 219 as a paving amendment.

Lord Belstead

My Lords, I am anxious to get across the point in reply to the amendment that the words, effective and economic application of the funds reflect meeting the needs of people in providing public passenger transport services. Perhaps I may say to the noble Lord, Lord Stallard, and to the noble Lord, Lord Somers, that I quite understand when both of them say to me that what should be uppermost in the minds of those providing services for people who are elderly and disabled is the matter of their needs. I hope I can show, briefly, that the words, effective and economic application of the funds lead one to the conclusion that what one has to do is to meet the needs of people.

In the first place, under Clauses 57 and 61 of the Bill authorities have a duty to secure public passenger transport services to meet any public transport requirements within their areas, and they have a duty to formulate general policies about the descriptions of services they propose to secure. In exercising those functions, authorities will have a further specific duty to have regard to the transport needs of members of the public who are elderly or disabled. This is a very important point which has been put into the Bill, and I think that it has been widely recognised in your Lordships' House. It means that when the policies of authorities are translated into decisions to secure particular services, those decisions will have to be taken with regard to the travel needs of elderly or disabled people.

5 p.m.

The draft code of practice on tendering for subsidised services which has just recently been sent out by the Department of Transport draws authorities' attention to the duties with regard to the elderly and disabled and discusses how this might be reflected in service specifications. On the extent to which provision might be made for special needs, for instance, some authorities might believe that certain specifications are needed in order to meet travel needs of elderly or disabled people. Other authorities may prefer to do this on selected routes or on selected services which they consider to be of particular importance to elderly or disabled people.

Other authorities may place greater emphasis on meeting special needs with specialised services while accepting a lower specification on other subsidised services generally, bearing in mind that money will not run on indefinitely to be spent on everything that an authority wants. The important point to understand is that first the policy stage and then the specification stage are the ones at which an authority makes key decisions about the way in which the needs of elderly or disabled people should be met when they are getting tenders in for subsidised services, and tenders are then invited on the basis of those specifications.

It is when tenders are received that Clause 86(7), to which these amendments are directed, comes into operation. This subsection requires authorities to judge between tenders using the criterion of the most economic and effective use of their subsidy funds. If I may say so to the noble Lord, Lord Stallard, the word "solely" is correctly used by the draftsman because it refers to the combined need to make the most effective and economic application of funds. "Solely" refers to those two criteria.

As your Lordships will understand, an essential point about a tendering process is that people can make offers on a fair and equitable basis to provide the service as specified. I am not saying that the authority should necessarily award the contract to the person who would do the job at the least cost. The criterion of effectiveness is equally important. Nor am I saying that the authority should award the contract to the person who would perform economically and effectively a service which does not come up to the specifications which have been asked for. If the authority specifies buses with low steps, it is not going to want to accept a tender from an operator whose buses do not meet that requirement, because elderly or disabled people will not be able to get on board. To do so would indeed be unfair to the other tenderers who tendered on the basis specified.

This does not of course mean that policy choices are completely ruled out at the stage when tenders are received. An authority might, I suppose, change its mind, but it would then have to make it clear that it was not acting in a discriminatory way in changing its mind. It would be for the authority to decide.

Therefore, my objection to this amendment is that it is based on a misunderstanding of the proper point at which the needs of elderly and disabled people should be taken into account in the tendering process. What we are concerned with in subsection (7), to which the amendment relates, is the final decision between tenders that have been submitted. In that context I would put it to your Lordships that the proper considerations to be taken into account are those of economy and effectiveness, and by "effectiveness" I mean the more human consideration of how effectively the authority will be meeting the needs of people—in the case of this debate, those who are elderly and disabled—always remembering that the effectiveness is at least as important as the economy.

It would obscure that nature of the whole process to bring in at this final stage a reference, albeit an important one, to one particular aspect of the needs to be specified in tenders. The proper stage for authorities to have regard to this matter is the earlier one of the specification of requirements. If I may go back to the beginning of what I said, it is firmly in the Bill that in formulating their policies authorities have a duty to have regard to the needs of the elderly and disabled. That is why I also resist Amendment No. 220 which would needlessly again mention elderly and disabled people at this particular point in the Bill.

I apologise for speaking at length. I hope I may have made clear to the noble Lord, Lord Stallard, that there is nothing between the Government and him except that we believe that this wording is right. We are at one in wanting to make sure that in getting tenders in, local authorities, within the discretion which they have under the Bill in the tendering arrangements, provide for the needs of elderly and disabled people.

Lord Stallard

My Lords, I am grateful for the courteous way in which the Minister has replied and the trouble he has taken to pick up the points that I made. While I would accept what the noble Lord has said in his explanation, I am sure that that same position would obtain in two or three years' time, following the coming into force of the Act, and there is a different Minister interpreting the Act, and reading this word "solely" and the guidance notes as well. I am not sure that the position would be the same as the present Minister has said.

Even he was in some difficulty in justifying why he himself separated effectiveness from economy in his letter, when he said: I can assure you this is not the case. The emphasis here is not only on economy but also on effectiveness, and effectiveness can only be judged by reference to the way in which a tender measures up to all the requirements of the original specification. The two things were quite clearly different so far as he was concerned, and therefore the word "solely" ought not to have applied.

The noble Lord mentioned again when winding up that there was no difference between me and the Government on the question of facilities for the disabled, and I would accept what he says, except that in this reply he said: But we do believe that it would be quite wrong to single out one particular aspect of the criteria. I do not think it would be quite wrong.

If the noble Lord said to me that that sentence is a mistake too, that it is not quite wrong to single out one aspect which has already been mentioned in the Bill and which he has already accepted and which he agrees with me is an important aspect, why is it wrong to single this out? If he says that that sentence is a mistake as well and that he will have another think about the word "solely", and on the basis of what he said in reply to the other matters, and in fairness to my noble friend Lord Ennals, I think I would withdraw the amendment but reserve my position to come back at the next stage.

Amendment, by leave, withdrawn.

[Amendment No. 220 not moved.]

Lord Belstead moved Amendment No. 221: Page 91, line 9, leave out subsection (8) and insert— ("(8) Subsection (7) above shall not be taken as requiring the authority to limit their consideration, in the case of any such invitation to tender, to the application of those funds for the purpose of securing the provision of the particular service to which that invitation to tender relates; and accordingly the authority may (in particular) take into account in making, in relation to any such invitation to tender, and determination to which that subsection applies—

  1. (a) costs and benefits in relation to any proposed expenditure by that or any other authority for the purpose of securing the provision of any other public passenger transport service;
  2. (b) costs and benefits in relation to any proposed expenditure on transport for the purposes of or in connection with the exercise and performance by that or any other authority of any functions of a description mentioned in section 85(2)(b) of this Act; and
  3. (c) any matter appearing to the authority to be relevant to determining whether the particular service to which that invitation to tender relates, and any other relevant service, would be effectively provided by any person who has submitted a tender in response to that invitation to tender.
For the purposes of paragraph (c) above, a service other than the particular service there mentioned is relevant if the authority propose to incur expenditure for the purpose of securing its provision and any tender or proposal for the provision of that service by any such person is also under consideration by the authority.")

The noble Lord said: My Lords, I beg to move Amendment No. 221, which is intended to amplify and clarify the existing subsection (8) of Clause 86. May I just say that in discussing the previous amendment moved by the noble Lord, Lord Stallard, I have already sought to make clear that in considering whether a particular tender represents an economic and effective use of subsidy funds, an authority is not necessarily constrained to accepting the lowest tender, but could, for instance, take account of the extent to which the needs of elderly and disabled people would be met.

Subsection (8) is intended to set out some of the considerations an authority might take into account beyond the service itself for which tenders were invitied. This new version in this amendment which we would ask your Lordships' House to substitute for the existing version is not intended to do anything different, but I hope is both clearer and more comprehensive. I beg to move.

On Question, amendment agreed to.

Clause 88 [Exceptions from section 86]:

Baroness Stedman moved Amendment No. 222: Page 92, line 39, at end insert— ("; or ( ) any service provided by virtue of a permit granted under section 22 of this Act.").

The noble Baroness said: My Lords, we are now into the field of the exemptions. I want to talk about community buses and their future. The community buses that are being used today cover a wide range of transport and basically they have been set up in the rural areas. Since the late 1970s these schemes have been growing slowly. Usually they comprise minibuses which seat anything from 8 to 16 people and they have to be run on a non-profit making basis, but they can provide bus services for the general public and, in effect, they provide a useful local bus service in many rural areas.

The safety standards and the compliance with the construction and use regulations are just as rigorous, but essentially they are a voluntary sector project. The 1978 Act required them to provide the services where no other conventional services were generally available. At the moment there are about 30 special schemes operating. The local authorities concerned top up any shortfall in finance. They fill gaps in the conventionial network and they do not attempt to duplicate the existing stage facilities. The community buses run when the conventional operators cannot fulfil the need. It is a nonsense for them to be included in the tendering rules.

The existing schemes may all need to cease next September because the county councils will have to withdraw their financial support. They will have to go out to tender to see whether any commercial operator wants to pick up a journey or two, which might just pay, and then go back to the local voluntary group and say: "These are the bits which do not pay and you can have them".

This amendment seeks to remove such a nonsense. If the community buses under Clause 22 are not accepted in the tendering arrangements there are unlikely to be any new schemes because, under Clause 19 of this Bill, a bus permit will enable a voluntary service to be run, but only for specific groups of people. The general public would be excluded. That would be a pity when the schemes could have a wider role, but it would be safer for the voluntary bodies to operate on a restricted basis to the disadvantage of the general public who are now at times able to use these buses. I beg to move.

Lord Belstead

My Lords, the noble Baroness is asking in this amendment for a specific exemption from tendering for community bus services. I share the noble Baroness's support for this movement. There is no question about it that community buses have done a lot of good and we wish to see that they continue to do so. The Government are nearer the position of the noble Baroness than I think she realises because we are proposing to make regulations under Clause 88 to exempt from tendering all agreements to subsidise services which involve subsidies of less than £2,500 a year. It is our feeling that the vast majority of agreements to subsidise community bus services will escape tendering under the de minimis exception. What then of a case where a local authority would like to give a subsidy in excess of that amount to a community bus service? We believe that in such cases where a substantial subsidy is involved it is only fair that all bus operators should be given a chance to tender for the service, for one is then considering a local bus service of a more general kind.

I should like to emphasise to the noble Baroness that those are our current proposals. Everything here can be done under regulations and this amendment is not necessary to achieve an exemption for community buses. At the moment we are consulting local authority associations and others about these and other proposals for regulations governing tendering. I give an undertaking to the noble Baroness that if the responses suggest that we have it wrong we shall think again. If, in the fullness of time, it becomes apparent that there is reason to change our view, the regulations can be changed.

Because of the information I have given about the £2,500 level, below which we believe there should be no requirement for tendering, we go along with the noble Baroness, provided that the subsidy does not go above £2,500.—So the view of the Government is much closer to the position in the amendment than perhaps the noble Baroness realised, and I hope that that information and the undertaking I have given to the noble Baroness about the making of the regulations will also persuade her that perhaps there is no need for her to press the amendment.

Baroness Stedman

My Lords, I am most grateful to the noble Lord. I had not expected to get so much accommodation from raising what appears to be quite a small amendment. I think he is probably right that the limit of £2,500 will cover most of the present community bus schemes. In the light of what he said, I am happy to withdraw my amendment and I hope that his consultations proceed satisfactorily.

Amendment, by leave, withdrawn.

5.15 p.m.

Lord Teviot moved Amendment No. 223: Page 93, line 2, at end insert— ("; or ( ) securing the provision of an unforeseen service.")

The noble Lord said: My Lords, I am sorry that I did not bring this point up at the Committee stage, where perhaps I should have done. It was something that emanated from it and I hope my noble friend will accommodate it.

Clause 88(2) spells out the circumstances in which a local authority can incur expenditure and obtain a local bus service by subsidy without immediately resorting to a tender procedure. The grounds are that urgent action is needed, there is not enough time for tenders to be sought and direct negotiation must take place. These are powers to deal with emergencies, but the subsection restricts such action to maintaining or replacing an existing service. It does not deal with cases where a new or extra service is urgently needed.

The main need for such action arises in education, from school or college movements. It is often impossible to tell exactly how numbers will work out. Your Lordships know that I always try to give an example. Last month in Ranskill in Nottinghamshire a double-deck bus carrying schoolchildren to Retford was overloaded because far more children stayed on to enter the sixth form than had been expected. It was vital therefore that an extra journey was run. This was done by negotiating for another service to be altered to enable a single deck journey to be converted to a double deck operation and to be completely rerouted over four miles to serve Ranskill. That has created a new route which differs from any existing service, and under the Bill as it stands that would require to be put out to tender, which would take some four to six weeks to sort out.

In this example the Bill could be ignored and the education department could lay on its own bus to Retford, remove the schoolchildren from the service bus and just leave a few members of the public to use it. In effect, three buses would then be used where two now suffice. That course of action might contravene Section 85 of the Bill, but would ensure that the county council did not contravene the Education Act 1944, whereby it is obliged to provide transport.

In other cases where children are not entitled to free travel the ability to secure an extra journey may be very important and no Education Act loophole would be available. Such peak journeys cost a lot to run and very often the only way of getting them would be by subsidy. Thus there needs to be a means of taking quick action to meet such unforeseen circumstances and to provide a new service. The tender procedure would then be taken up as soon as possible to serve a permanent arrangement. Indeed, the new service could be temporary as tenders might be sought to alter other services and short term cover might be needed while it is being sorted out. I beg to move.

Lord Monk Bretton

My Lords, I should like to say a word or two in support of my noble friend's amendment. I think it is worth supporting if such provisions are not already in the Bill. I am advised that it could also be useful for the institution from time to time, in circumstances which might arise fairly suddenly, of a trial service which could be done simply on a "use it or lose it" basis, so that one knew whether or not it was worth proceeding with thereafter.

Lord Brabazon of Tara

My Lords, as my noble friend has stated, the purpose of Clause 88(2) is to provide an essential flexibility for authorities to take prompt action without recourse to tendering to avoid disruption of services on which the public rely. These can be services which were about to stop operating or services which have suddenly cease to operate. In those cases, the Bill gives authorities the flexibility to make arrangements to ensure continuity of services until tenders can be invited and a service substitute agreement entered into in the normal way.

I am not sure that I agree with the example he gave of how the necessity for a new service could suddenly arise. Surely, in the case he gave of more school-children staying on for the sixth form, there would be at least a term's notice of that kind of requirement.

Lord Tordoff

My Lords, I think the noble Lord will find that in the present circumstances, particularly at the older end of the school where the sixth form is involved, during the period of the summer a number of children who intended to go out to work find that there is no employment for them and then go back to school again for a final year. This is something that I think the Government would encourage, rather than having children on the dole. I assure the noble Lord that this is a genuine problem in certain cases where the parents and children together do not make up their minds to go back to school until the very last minute, and it can cause problems.

Lord Brabazon of Tara

My Lords, I have listened most carefully to the point that the noble Lord, Lord Tordoff, has made. As I say, we felt that authorities should have sufficient warning for this kind of thing; but if this is indeed the case, I think it is something that we should look at. I shall definitely look at this and come back to my noble friend.

Baroness Carnegy of Lour

My Lords, may I ask my noble friend on the Front Bench—and I may have misunderstood this—whether, if a second bus is required on a service route because of additional school pupils, this can be provided under the existing arrangements without any alteration to the Bill? What the noble Lord, Lord Tordoff, has said is perfectly obvious: very often, people make the decision in the last week of the holidays. But there is more than that to it. Parents who pay for their children's education also may decide, "This is an excellent bus service and we want to put our child on the bus rather than take it by car", or even to put six children on to the bus instead of taking them by car. So it is not only a matter of the authority which is deciding to give free school transport on the bus but also of parents who pay. The school numbers can go up and down very quickly. Is a second bus on the same route, and thus part of the same service, not possible under the provisions of the Bill?

Lord Brabazon of Tara

My Lords, I should expect that it was possible but, as I have said to my noble friend Lord Teviot, I shall look into this and come back to him. However, I think we shall find that it is possible.

Lord Teviot

My Lords, I am grateful to my noble friend and I am very glad that he will look into this matter. I think that in view of what my noble friend Lady Carnegy has said, I should like rather to repeat what I said when I moved this amendment: that this is very much a case of "due to unforeseen circumstances". I am most grateful to the noble Lord, Lord Tordoff, for his pointing out the facts about the schoolchildren. We may call them schoolchildren, but they are not necessarily what one thinks of as nice little things going around in long socks and berets. They are probably great hulking brutes of between 16 and 18, or something of that sort, and they do need a service. I think we must think in terms of such pupils to get this absolutely right.

One also wants this provision simply as a temporary measure in order to run the service until a tender can be agreed—merely to cover that period—and I can see this happening. I am most grateful that my noble friend has said he will look into this. I beg leave to withdraw this amendment.

Amendment, by leave, withdrawn.

Lord McIntosh of Haringey moved Amendment No. 224: Page 93, line 2, at end insert— ("; or ( ) Securing the provision of a service already available to the public which would not otherwise be maintained where the authority will be unable to either issue an invitation to tender, or accept a tender before the end of the transitional period as determined in the Fifth Schedule to this act.").

The noble Lord said: My Lords, this may be an attempt to continue the education of those educated at Eton and Harrow into the workings of the state education system; I do not know. This is by way of being a paving amendment on a very similar but not identical subject to that of the amendment just moved by the noble Lord, Lord Teviot. It is based on an interpretation of Clause 88(2) on which I would very much welcome the Government's guidance. As I understand it, the phrase "urgently required" for these various purposes—maintaining the existing service or securing the provision of a service in place of a service which has ceased to operate—refers to the needs of the passengers to avoid disruption of services. That is my understanding of what the noble Lord, Lord Brabazon, has just said.

I should like to put it to Ministers that there is another kind of urgency and that is, particularly in the transitional period, when (even with the extension of the transitional period which was granted on Monday) there is going to be great difficulty for the tendering authorities and the operators to secure that the tenders are received, assessed, adjudicated and acted upon in time for the services to start at the proper time after deregulation.

I should like an assurance that that kind of problem—one which the noble Lord, Lord Belstead, acknowledged might take place because he acknowledged that the time table for Schedule 5 was tight—would be included in the definition of the "urgency" and that there might in certain circumstances be the possibility of the tendering procedure being set aside for the purpose of securing that necessary services operate after deregulation day.

I say that it is a probing amendment because, having put down the amendment, I appreciate that my amendment: Securing the provision of a service already available to the public…

could be thought to be saying no more than is said by the phrase, "maintaining an existing service". So I readily acknowledge that the wording of the amendment, or at least its placing in the Bill, is defective. Certainly, I have no intention of pursuing it; but it would be very helpful, before I decide what might be put down (if anything at all) at Third Reading, if I could have the assurance of the Government that the problems facing the tendering authorities and the operators in achieving the timetable of the tendering period will be taken into effect in the definition of the word "urgency".

Lord Brabazon of Tara

My Lords, I am grateful to the noble Lord, Lord McIntosh, for moving this amendment and giving me the opportunity to explain fully the scope of Clause 88(2). This clause enables authorities to enter into emergency agreements without recourse to tendering, to maintain existing services or to reinstate services which have ceased to operate. Although this provision is intended to give authorities important flexibility in subsidising services generally, it will apply equally to the transitional period as this group of clauses will be commenced early and could be used by authorities in precisely the circumstances contemplated by the noble Lord's amendment.

Authorities will have to invite tenders as soon as possible after entering into the emergency agreement and that agreement should then last no longer than three months after the end of the period allowed for the submission of tenders. I would certainly not suggest that this provision is one which gives authorities carte blanche for delay. The wording suggests nothing of the kind. But it is available for unforeseen eventualities or hiccoughs which the transition may throw up. On the basis of that assurance and the explanation I have given, I hope the noble Lord will be satisfied.

Lord McIntosh of Haringey

My Lords, I am most grateful to the noble Lord. That certainly is a new interpretation of the clause. I had not encountered this three months' leeway before. At first hearing, it sounds as though it meets the case admirably, I supose that perhaps I should protect myself by saying that we may take it further at Third Reading, but it appears at the moment to be perfectly proper for me to beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

5.30 p.m.

Lord Brabazon of Tara moved Amendments Nos. 225 and 226:

[Printed earlier: col. 726.]

The noble Lord said: My Lords, I beg to move these amendments. I spoke to them with Amendment No. 217. I beg to move.

On Question, amendments agreed to.

Following is the text of the amendments (Nos. 225 and 226): Page 93, line 4, leave out ("respect of") and insert ("order to secure"). Page 93, line 27, leave out ("respect of") and insert ("order to secure").

Lord McIntosh of Haringey moved Amendment No. 227: After Clause 89, insert the following new clause:

.—(1) Except as provided in subsection (2) below, the provisions of section 9A(6) of the 1968 Act and sections 61(7), 77 and 89(1) of this Act, requiring the persons to which those provisions apply to conduct themselves so as not to inhibit competition, shall not be construed as imposing, either directly or indirectly, any form of duty or liability enforceable by proceedings before any court to which those persons would not otherwise be subject. (2) For the purposes of section 11 of the Competition Act 1980 (references of public bodies and certain other persons subject to statutory controls to the Monopolies and Mergers Commission) contravention of any provision mentioned in subsection (1) shall be taken to be possible abuse of a monopoly situation.").

The noble Lord said: My Lords, in moving this amendment I would wish to speak to Amendments Nos. 283 and 284. Amendment No. 283: Clause 109, page 113, line 15, leave out subsection (1). Amendment No. 284: Page 114, line 5, leave out subsection (3).

The whole issue of preventing conduct inhibiting competition occurs on a number of occasions in the Bill. I believe there are four specific references to that.

In moving this amendment I do not wish in any way to encourage the inhibition of competition, if that is not a double negative. In the context of the Bill as it is going through, we are in favour of any advantages that can be gained from competition between operators. Where we differ from the Government over this concerns the way in which competition can best be maintained and the inhibition of competition can best be prevented.

The problem is really very simple. The Bill proposes in these four places that there shall be the possibility of civil proceedings against action which may be thought to be inhibiting competition. The problem with civil proceedings, although I am no lawyer, is that they can be pursued by means of interlocutory injunctions, which immediately stop the person complained of providing the service or doing the action which is thought to be inhibiting competition.

The problem there is not when it is pursued in a responsible way, but it occurs when the way is left open for less scrupulous people to use the power of an interlocutory injunction to hold up the whole process of the formulation of a network of services and of tendering, and to prevent all those concerned—the tendering authorities and the operators—from carrying out the wishes of Government and seeking to do that which is required by this Bill. It could make a nonsense of the whole thing if operators, in a sort of dog-in-the-manger attitude, were in any way aggrieved by the way in which the tendering process is proceeding and attempted to disrupt it by means of interlocutory injunctions.

Fortunately, there is a perfectly acceptable alternative—an alternative which is used in many comparable cases and which has additional advantages to that of not disrupting the services. That is the possibility of using a reference, under Section 11 of the Competition Act 1980, to the Monopolies and Mergers Commission.

The main point is that the services carry on while the reference is made. The Government may say that this could be a lengthy period, but I believe it is within the power of Government to see to it that decisions are made fairly rapidly on issues of this kind. The additional advantage is that it forces the passenger transport authorities and the local authorities generally to be as explicit as possible about the policies on which they are operating the tendering procedures.

That of course is what is recommended by the Government themselves in their suggested code of practice for tendering, which has now gone out for consultation purposes. It is entirely right that the authorities should be forced to make clear to the public what they are trying to do for public transport on their areas. That, in turn, should form a basis on which the Monopolies and Mergers Commission could decide whether any particular action, in the light of those policies, is inhibiting competition or possibly doing so.

I believe that with this amendment we remove a serious danger of disruption to the tendering process. We also replace it with something which will be equally effective but much less disruptive and damaging, and which I believe will be in conformity with the intentions of the framers of this Bill. Indeed, it is because Section 11 of the Competition Act 1980 does appear on the face of the Bill that Amendments Nos. 283 and 284 seek to remove those references, which become redundant if this amendment is passed. I beg to move.

Lord Denning

My Lords, may I say a word in favour of this amendment. It is to lawyers and to the courts a most important matter in regard to new legislation which is just coming in, favouring competition and prohibiting those who would prevent competition. It occurs in the Treaty of Rome, in the Common Market legislation (Articles 85 and 86) and it occurs in our own Competition Act 1980.

Let me explain. We all agree that competition is a good thing. But, equally, prevention of competition is a bad thing. At auction sales we are in favour of all the bidders competing one against the other. We are against "rings" which prevent competition. Again, with tendering for a building contract, we are in favour of all the contractors being a liberty to compete and put in a low tender. We are against any rings or arrangements which would prevent competition. That is the idea which runs through our Common Market. In Articles 85 and 86 there are provisions which are aimed against any prevention or restriction of competition and which are against any abuse of a dominant position.

There, my Lords, no remedy is provided in the Treaty as to what is to be done if those provisions are broken. It is the same here. We have four provisions in this Bill which say that the county council or the passenger authority are so to conduct themselves as not to inhibit competition. Those are excellent provisions. My noble friend Lord McIntosh has said that he does not dispute those at all. We want competition and we do not want it inhibited by rings or anything of that kind.

The provisions themselves are very good, but where this legislation falls down is that it does not tell us what the remedies are when there is a breach of that duty. It does not say whether there is an action at law in the High Court or a reference to a tribunal; it does not say what the remedies are, whether it is damages or an injunction or the like. The problem has come before our courts in regard to similar provisions in the Treaty of Rome; and it is said that there is no action for damages if they are broken. They suggest, but it is not decided, that there might be an injunction. This is such a matter—it is a principle of legislation, as has been said from time to time by the judges—and this statute itself ought to tell the courts what are the remedies when there is a breach.

I remember the great case of Cutler v. Wandsworth Stadium in 1949 (Appeal Cases 398) when this House judicially stated that legislators ought to insert into the statute what are the remedies if there is a breach and not leave the courts to try to work it out afterwards, looking at the whole of the Act. The statute ought to say what are the remedies. In this statute there ought to be some provision saying what is to happen if a passenger authority or a county council breaks the rules and, in effect, does not invite tenders from everyone and just invites tenders from a very few friends. That is an abuse of a dominant position; it is unfair competition and it is a breach of the statute.

But what is the remedy? There is not a word here as to what is to be done. If nothing is done, I do not think that there will be action for damages; it will be too difficult to assess. It may be that an injunction would be granted, but in those circumstances one must be very careful of injunctions. An injunction is the most delicate thing of all. If you grant an injunction you will stop any tendering and put things back for ages. It is not spelt out in any way in the statute. I suggest, as it is suggested in the amendment, that there is an analagous remedy already available in our Competition Act 1980, which specially deals with cases where people are trying to restrict or prevent competition. It means that there should be a reference to the Monopolies and Mergers Commission, which can report about it. I shall not go into all the details, but if its report is adverse the Secretary of State can make an order, and if the order is disobeyed the people concerned can be taken if need be before the criminal courts.

Surely that is a sensible remedy which could, quite quickly, be brought about. The Director General of Fair Trading, who comes under that Act, could take it up. There could be a quick investigation and a report made and, if need be, the Secretary of State could make an order so as to prevent any abuse. But at all events my one plea is that some provision should be inserted in this statute as to what is to happen if there is a breach in connection with tendering and an abuse of the position in that way. So far as I can see, the suggestion in this amendment is quite a good one, so I support the amendment.

Lord Belstead

My Lords, there are a number of places in this Bill where a duty is placed on local authorities to conduct themselves so as not to inhibit competition between operators and potential operators of public passenger transport services. Those duties are there because we believe a healthy competitive market is essential if passengers are to have good and reasonably priced services. The noble and learned Lord, Lord Denning, has explained with great clarity why he believes that is right, and I think it is also a thesis to which the noble Lord, Lord McIntosh, subscribed in his opening remarks.

I think it is right to say that this is a Bill in which we also accept that a free competitive market cannot meet all passengers' interests. That is why this Bill gives authorities wide powers to subsidise services and to promote the availability of services. But if those powers are used in such a way as to stifle competition, we will all be worse off; and it is there that the provisions of the Bill, to which the noble Lord, Lord McIntosh, has his amendment down, come into play.

I believe I can calm some of the noble Lord's concern by emphasising that the Bill does not say that authorities should do nothing which has an adverse effect on operators. The exercise of the subsidy and promotion powers in the Bill is bound to have some effect on particular operators. But what we are concerned about is the broad effect of authorities' policies and actions on competition between all operators. Your Lordships may be interested to know that we say as much in the recently issued draft code of practice on tendering.

5.45 p.m.

I was most interested that the noble and learned Lord, Lord Denning, gave an example of a probable anti-competitive practice, if an authority were to give an opportunity for tendering only to those whom the authority knew particularly well. Indeed, the code of practice on tendering which we have just sent out suggests that if authorities package services for tender in such a way that only one operator or a very limited number of operators would have a chance to bid, that would clearly be an anti-competitive practice.

My understanding is that the amendment would exclude from any sort of consideration by the court any aspect of the way an authority conducts itself in relation to these duties. I am well aware that the form of words used to do so has precedence in legislation, but I suggest that where such a limitation has been placed on statutory duties in the past the duties were ones on which it was hardly reasonable to expect the court to take a view as to whether the body concerned had complied with its duty.

London Regional Transport has a duty to provide or secure the provision of public transport services for Greater London. That is framed in such a way as to show that the duty is concerned with the broad principle of what LRT is there to do—its policies, really—and I understand that the court traditionally has been reluctant to pronounce on matters of policy. I suggest that the competition duties in this Bill are rather different from that. It is not for me to say whether or not, in this or that particular circumstance, the courts would allow an individual to bring an action against a local authority. All I would say is that it appears to me that the effect of this amendment is to prevent ratepayers and operators having any legal redress whatsoever against an authority, and I wonder whether the House would welcome that.

The alternative suggestion in this amendment is that the Monopolies and Mergers Commission should instead have a role here. Section 11 of the Competition Act 1980, to which the amendment refers, deals with questions of efficiency and monopoly abuse by public sector bodies which are supplying goods and services to the public. That is not appropriate to authorities' exercise of subsidy powers. I can understand the concern of the noble Lord, Lord McIntosh, in moving this amendment. I hope that I have said something to show that I believe his fears are exaggerated and that the courts provide a necessary, if only seldom to be used, protection for the public.

If I may attempt to reply to the noble and learned Lord, Lord Denning, the Government considered making some specific provision for penalties, but decided against. My advice is that court decisions—the Blackburn cases and the British Transport Commission v. Gourlay are examples—have set out some rules and it is our belief that the courts will be able to develop their rules further from this basis. Perhaps I may look with care at what has been said by the noble and learned Lord and, of course, by the noble Lord, Lord McIntosh, in moving this amendment. However, I hope that what I have said goes some way to arrest the concern which is the basis of the amendment of the noble Lord, Lord McIntosh.

Lord McIntosh of Haringey

My Lords, I have listened very carefully to that reply. I appreciate that at this late stage in the Bill it is difficult for the Minister to give assurances which are going to cause significant disruption to the drafting of the Bill, but I have to say that I do not think the noble Lord has in any way answered the objections which I raised or, still more, the objections raised from the highest quarter, by the noble and learned Lord, Lord Denning. The noble and learned Lord expressed the view, for which as a layman I have great sympathy, that legislation should not impose duties without suggesting what the remedies will be. It is simply not good enough for the courts to be told by the Minister that the duty expressed a broad view or a broad principle. That is not what is said on the face of the Bill.

On the face of the Bill there is a duty on the local authorities so to, conduct themselves as not to inhibit competition between persons providing or seeking to provide public passenger transport services in their area". It is that phrase with which the courts will be concerned, not with the statements of the Minister in this place or of Ministers in another place, or with the draft code of tendering practice which is an instruction or will be an instruction to those responsible for the tendering process. There has been no answer whatsoever to the statement by the noble and learned Lord, Lord Denning, that the Bill does not provide any indication as to what shall be the remedy for any failure to perform- that duty. The duty is very clear, as I have said.

I am in no legal position to make a judgment as between legal experts and legal examples, but the noble and learned Lord, Lord Denning, said that he thought there would be circumstances in which an interlocutory injunction might be obtained. The House ought to take seriously what he says and I do not think it ought to be satisfied with the assurances or answers given by the Minister. This is not only a legal question but a question about the effective pursuit of the objectives of the Bill. If the Government seriously want this tendering procedure to go through they ought not to leave it open for any persons—the kind of persons who do it would typically be the larger operators who would have the financial and legal muscle to seek these interlocutory injunctions—to abuse the procedure by seeking action in the civil court.

For the life of me I cannot see why the Government should resist that conclusion. It must be in their interests to see to it that there is no disruption of that kind. When there is a clear alternative (which is already referred to in the Bill) which the noble and learned Lord has confirmed is appropriate for these circumstances, and indeed was designed for these circumstances and comes in a Bill which was introduced by this Government, for the life of me I cannot see why the Government should resist that alternative and resist the opportunity to avoid the disruption which has been predicted not only by myself but by those who have much greater knowledge of the law and of bus operations. In the light of those answers, I fear that I have no alternative but to seek the opinion of the House.

5.54 p.m.

On Question, Whether the said Amendment (No. 227) shall be agreed to?

Their Lordships divided: Contents, 71; Not-Contents, 93.

DIVISION NO. 2
CONTENTS
Airedale, L. Kagan, L.
Attlee, E. Kennet, L.
Aylestone, L. Kilbracken, L.
Blease, L. Kissin, L.
Boston of Faversham, L. Lawrence, L.
Bottomley, L. Llewelyn-Davies of Hastoe, B.
Brockway, L. Lockwood, B.
Bruce of Donington, L. McIntosh of Haringey, L.
Carmichael of Kelvingrove, L. McNair, L.
Cledwyn of Penrhos, L. Meliish, L.
Collison, L. Meston, L.
Crawshaw of Aintree, L. Mishcon, L.
David, B. [Teller.] Monkswell, L.
Dean of Beswick, L. Morton of Shuna, L.
Denning, L. Mulley, L.
Donaldson of Kingsbridge, L. Nicol, B.
Donoughue, L. Ogmore, L.
Ewart-Biggs, B. Parry, L.
Fisher of Rednal, B. Ponsonby of Shulbrede, L. [Teller.]
Gallacher, L.
Gladwyn, L. Ritchie of Dundee, L.
Glenamara, L. Russell of Liverpool, L.
Graham of Edmonton, L. Shepherd, L.
Greenway, L. Silkin of Dulwich, L.
Hampton, L. Somers, L.
Hanworth, V. Stallard, L.
Hatch of Lusby, L. Stedman, B.
Hayter, L. Stewart of Fulham, L.
Henderson of Brompton, L. Stoddart of Swindon, L.
Houghton of Sowerby, L. Teviot, L.
Hylton-Foster, B. Tordoff, L.
Irving of Dartford, L. Underhill, L.
Jacques, L. Wallace of Coslany, L.
Jeger, B. Wells-Pestell, L.
Jenkins of Putney, L. White, B.
John-Mackie, L. Willis, L.
NOT-CONTENTS
Airey of Abingdon, B. Glenarthur, L.
Alexander of Tunis, E. Gray of Contin, L.
Allenby of Megiddo, V. Gridley, L.
Belhaven and Stenton, L. Hailsham of Saint Marylebone, L.
Belstead, L.
Bessborough, E. Hardinge of Penshurst, L.
Brabazon of Tara, L. Henley, L.
Brougham and Vaux, L. Hives, L.
Broxbourne, L. Holderness, L.
Buckinghamshire, E. Hood, V.
Butterworth, L. Hooper, B.
Caithness, E. Inchcape, E.
Cameron of Lochbroom, L. Kitchener, E.
Carnegy of Lour, B. Lane-Fox, B.
Coleraine, L. Lauderdale, E.
Colwyn, L. Lindsey and Abingdon, E.
Cowley, E. Liverpool, E.
Cox, B. Long, V.
Craigavon, V. Lucas of Chilworth, L.
Daventry, V. Lyell, L.
Davidson, V. McAlpine of West Green, L.
Denham, L. [Teller.] Mancroft, L.
Drumalbyn, L. Margadale, L.
Elles, B. Marley, L.
Elliot of Harwood, B. Merrivale, L.
Elliott of Morpeth, L. Mersey, V.
Elton, L. Monk Bretton, L.
Foley, L. Mottistone, L.
Fraser of Kilmorack, L. Mowbray and Stourton, L.
Gainford, L. Nugent of Guildford, L.
Glanusk, L. Orkney, E.
Orr-Ewing, L. Tranmire, L.
Pender, L. Trefgarne, L.
Plummer of St Marylebone, L. Trenchard, V.
Trumpington, B.
Reay, L. Vaux of Harrowden, L.
Renton, L. Vickers, B.
Rochdale, V. Vivian, L.
Rodney, L. Waldegrave, E.
St. Davids, V. Ward of Witley, V.
Sanderson of Bowden, L. Whitelaw, V.
Selkirk, E. Windlesham, L.
Skelmersdale, L. Wolfson, L.
Strathcarron, L. Wynford, L.
Strathspey, L. Young, B.
Sudeley, L. Young of Graffham, L.
Swinfen, L. Ypres, E.
Swinton, E. [Teller.]

Resolved in the negative, and amendment disagreed to accordingly.

6.2 p.m.

Clause 90 [Travel concession schemes]:

The Parliamentary Under-Secretary of State, Department of Transport (The Earl of Caithness) moved Amendment No. 228. Page 94, line 26, leave out ("relevant") and insert ("public passenger transport").

The noble Earl said: My Lords, we move to new territory here, and to the subject of travel concession schemes. During the course of consultation on our proposed arrangements for the reimbursement of concessionary fares, it became clear that many authorities in the non-metropolitan areas were seriously concerned about the implications of the limitation on their powers. This is the case especially in respect of rail services where many authorities are already providing concessions and which, as some authorities have pointed out, are in some areas at least as important for the availability of public transport as are bus services.

Very strong representations were made by people including my noble friend Lord Mottistone and the noble Baroness, Lady Stedman. I am particularly grateful to them because I am happy to be able to tell them and the rest of the House that in view of their comments we have decided to remove the existing distinction and make the power to provide concessions available for all forms of public pssenger service in all parts of the country. I beg to move.

Lord Mottistone

My Lords, I am extremely grateful to my noble friend for having made this move. I know that the Isle of Wight will be particularly pleased to see this amendment made.

Baroness Stedman

My Lords, I too wish to express thanks to the Minister. It is nice to know that what we are doing is now legal, as there were some doubts expressed at the last stage of the Bill. I am most grateful to the noble Earl.

Lord Henderson of Brompton

My Lords, perhaps I may add the thanks of the Cross-Benchers for this move. I wonder whether this excellent change in the interests of equality would have been made had it not been for the backing of the noble Lord, Lord Mottistone, and the fact that he lives in the Isle of Wight.

On Question, amendment agreed to.

The Earl of Caithness moved Amendment No. 229. Page 94, line 42, leave out subsection (3).

The noble Earl said: My Lords, I must apologise to the House because when speaking to the previous amendment, I should have spoken also to Amendments Nos. 229, 230 and 239: Amendment No. 230: Page 95, line 44, leave out ("relevant"). Amendment No. 239: Clause 93, Page 99, line 15, leave out ("is a relevant service for the purposes of") and insert ("runs or will run between places within the limits covered by").

However, in the circumstances, I do not believe that it makes too much difference. I beg to move.

On Question, amendment agreed to.

The Earl of Caithness moved Amendment No. 230:

[Printed above.]

On Question, amendment agreed to.

Baroness Stedman moved Amendment No. 231: Page 96, line 8, leave out ("are") and insert ("may include").

The noble Baroness said: My Lords, in moving this amendment I should like to reiterate what I said yesterday; that we have received considerable co-operation from the Minister, who has been good enough to meet members of the all-party group and has corresponded with others. We are grateful to him for the most generous way in which he has given of his time to try to satisfy us. The Minister met the all-party group to discuss this issue, among many others. He wrote to us all on 25th September, and I shall quote his letter. He stated: On the question of extending the coverage of concessionary fare schemes to cover the categories of people who are eligible to receive assistance from social services authorities under the National Assistance Act 1948, including people suffering from mental disorders, who are deaf or dumb, or suffer from other handicaps prescribed by the Secretary of State, I am afraid that it remains our view that the existing division of responsibilities and powers provides the best solution. It is we believe the social services departments who are best placed to identify the people concerned and who are most likely to be aware of the kind of support that they need. We are not convinced therefore that there is a sufficient case for changing the pattern or existing legislation in this area".

Perhaps we would not quarrel with the noble Lord, and that it is right to say that the social services departments are certainly well placed to be those best suited to identify the people concerned. However, that applies equally to people who are physically handicapped and who do come within the category already included in Clause 90. That is not the point at issue.

The concessionary fares scheme is an arrangement secured between the local authorities and the transport operators. Under the terms of this Bill they will need to negotiate terms for reimbursement. They will have to arrange for the tokens and the passes to be issued and to publish the travel availability. It is essentially a transport service negotiation.

Eligibility and desirability in making concessions to particular groups are quite separate from the negotiations with the transport operators. The exclusion of the deaf and the dumb and the mentally handicapped from the face of this Bill means that they will have to be treated separately and that the social services authority will have to enter into the necessary arrangements and negotiate to secure concessions for such people.

We feel that that would be adding unnecessary bureacracy and would be keeping a distinction which could mean that existing concessions may not be maintained. Since putting down this and the linked amendment, other noble Lords have also put down related amendments; notably Amendment No. 232A: Amendment No. 232A: Page 96, line 21, at end insert

In the light of what those other amendments say, I believe that they may cover the point we have tried to make. If so, I may at the appropriate time seek the leave of the House to withdraw both Amendments Nos. 231 and 232: Amendment No. 232: Page 96, line 21, at end insert— ("and ( ) any other persons included in section 29 of the National Assistance Act 1948.").

I should do so in favour of Amendment No. 232A because we shall probably find when other noble Lords have spoken, that that amendment covers the same points made by Amendments Nos. 231 and 232.

Lord Tordoff

My Lords, I believe it was the intention of my noble friend to suggest that we should at this stage discuss in addition to Amendments Nos. 231, 232 and 232A Amendment No. 268A: Amendment No. 268A: Clause 101, page 108, line 11, leave out subsection (1). Let me add immediately, because a worried frown has come over the Minister's face and I would not wish it to stay there for a moment longer, or at least not at this time of night, that I only suggest that because it seems to those involved that Amendment No. 268A, which refers to Clause 101(1), has merely been laid down as a marker. If Amendment No. 232A were to be accepted by the Government, then it is our belief that some changes would need to be made to Clause 101(1). It is certainly not our intention to press the deletion of subsection (1) at this stage. It is there merely as a marker.

My Lords, it will be seen immediately that the difference between the amendment moved by my noble friend and the one in which I am interested, No. 232A, is that we are referring to the legislation enacted in the Concessionary Travel of Handicapped Persons (Scotland) Act 1980. The reason is, first, that this is a more modern Act introduced by the present Government. There was some doubt as to whether the reference to the Act mentioned in the earlier amendment, the National Assistance Act 1948, being inapplicable in Scotland covered the purposes for which these amendments were intended. Nevertheless, I think the categories of people are quite clear. At present, the PTAs in the metropolitan areas and their PTEs have clearly defined general powers to offer concessionary fares under Section 15(2)(b) of the Transport Act 1968. The legal position is that the executive can put forward proposals to the authority for reducing or waiving charges in the case or cases of a particular class. If the authority approves the proposals they can be implemented and there is no requirement that the scheme should be necessarily self-financing. After weighing all the considerations, if the authority determines that the cost justifies the benefits it can apply this power. Also at the moment, through the operation of Section 24 agreements in various metropolitan areas, it is normally the case that concessionary travel arrangements can be applied on the majority of services throughout the area, both for PTE and NBC buses. Thus, in essence at present there is a general power which usually can be applied throughout the area on a uniform basis. This has been a great boon to many people in these categories. This general power is exercisable by the PTA and PTE and allows them to bear the cost of such arrangements.

In order to ensure that the general power as it relates to the disabled groups remains as hitherto, it is necessary to add to the list of categories in Clause 90(8) the ability to make concessionary fares available to other classes of persons as approved by the relevant local authority. If this is not done, we believe the PTEs and the PTAs are powerless to ensure concessionary travel to the people to whom my noble friend referred, the deaf, the dumb and the handicapped. It is true that Clause 101(2) provides that where a local authority under the National Assistance Act 1948 is willing to provide money for concessionary travel in respect of the welfare of handicapped persons, this can be done.

This is all very well and, indeed, the local authorities at the moment in metropolitan areas already have powers to provide money for concessionary travel arrangements. However, with district councils being particularly hampered by financial restrictions, it is inappropriate to rely on their good offices to ensure the continuance of concessionary travel schemes outside this specific category's "get out" at the moment in Clause 90(8). Therefore, while it is appropriate to see that the district councils do have the power to provide for the cost of concessionary travel for handicapped persons, it seems total diminution of the existing general powers merely to rely on that power instead of allowing both the PTA and the district councils to have the appropriate powers assuming, most importantly, that the monetary situation allows them to exercise those powers in the first place. The important thing is that the powers should be available if the PTA has the resources and wishes to exercise its discretionary power in a particular way.

6.15 p.m.

The Secretary of State for Transport and other Government spokesmen have said throughout the Bill that the proposals of the Government do not affect the powers of the PTAs to deal with travel concessions. Clause 98 of the Transport Bill re-enacts the previous powers and clarifies the position with regard to children and scholars, and during the Committee stage here the wording in Clause 90(8) relating to children was altered, and the Government also introduced Clause 101 which meant other classes of people could not receive benefit in the form of reduced or waived charges unless the cost thereof is made up by some other party, for instance, the district council.

A letter to the AMA from a Mr. Fawcett of the Department of Transport, who may just be listening now, dated 3rd October, indicates that this maintains the status quo, but this is not the case, as is seen from cases in Greater Manchester. The noble Lord, Lord Carmichael of Kelvingrove, will be referring on a later amendment to the question of school-leavers, but in the case of the profoundly deaf, for instance, approximately 1,800 people have free travel in Greater Manchester. This is mainly because this group have difficulty in communicating with bus crews. In Scotland the transport authority are permitted to grant travel concessions to this group, under the Concessionary Travel for Handicapped Persons (Scotland) Act to which this amendment refers. The cost of this concession would pass on to the district councils, but they would be charged £67 per pass, which would add up to approximately £120,000 per annum to the district council costs in Greater Manchester.

The same sort of considerations apply to the mentally handicapped, and even larger sums are involved. In the case of Greater Manchester, something like £850,000 extra would be added. Similar examples can be quoted from Tyne and Wear where the mentally handicapped receive concessions under the general powers. It is argued that if the Government persist with these proposals, the groups mentioned will be adversely affected. We suggest that Clause 90(8) is amended accordingly, and Clause 101(1) should be either deleted or subsequently altered, otherwise people such as the deaf and the mentally handicapped will be affected. That is the case we are making for this amendment. I believe it is an important one, as my noble friend has said. The Bill as it now stands simply does not cater for these people. I hope the Government will accept this amendment because I believe my noble friends intend to withdraw their amendments. I do not at the moment beg to move it. I am specifically speaking to Amendment No. 232A, and in due course I will move that amendment.

Lord Carmichael of Kelvingrove

My Lords, briefly I would like to support the previous speakers on this amendment. There is little more to be said except perhaps to repeat the salient fact that we are not asking that a great deal of public money be used in these three categories relative to the sums already spent on concessionary fares—the sums involved here to allow for the categories mentioned; that is, the profoundly deaf and the mentally handicapped. The figure is really very small indeed.

Also, of course, it is particularly apt that the method has been used in Scotland using the Concessionary Travel for Handicapped Persons (Scotland) Act 1980. It is important to observe that it was the present Government which introduced it. It means there is a great deal of leeway for the local authority to put the categories together, so there is no invidious comparison one with the other. On the question of the mentally handicapped, for instance, I understand one of the great advantages is that it saves a great deal of personal embarrassment to both staff and the person involved. The same applies to the deaf, because one of the great tragedies of being deaf is that people do not recognise that you are deaf until some sign is made by you to indicate that you are.

I could give the noble Lord the Minister some figures. I am sure he has them already, but we are talking about small figures. I have figures for Manchester—12,000 mentally handicapped people have free travel passes on local buses and the cost is really very little compared to the cost of all the other passes for disabled people of various categories. I hope the Minister will take this very seriously. I am happy to support the speeches made by the previous two speakers.

Lord Belstead

My Lords, may I take it that we are speaking also to Amendment No. 231A?

Noble Lords

No.

Lord Belstead

My Lords, so we are not taking Amendment No. 231A, just Amendments Nos. 231, 232, and 232A, together with Amendment No. 268A.

Lord Tordoff

My Lords, if I may assist the noble Lord the Minister, we felt that the education aspect was a slightly different argument and might be better set aside.

Lord Belstead

My Lords, then I shall reply to the amendments which are concerned with disabled people. I assure your Lordships that the Government share the general concern to improve travel facilities for disabled people. Indeed, the noble Baroness. Lady Stedman, was good enough to say that we had done our best in the Bill, so far, to take on board a number of amendments to seek to ensure this.

However, there are difficulties with these amendments, and the difficulties are these. Section 29 of the National Assistance Act 1948, as amended, already gives social services authorities in England and Wales the power to provide various services and facilities for people in these groups. Indeed, the noble Lord, Lord Carmichael, specified that he is talking about those who are outside Clause 90(8); for example, referring to the deaf, the blind and the mentally handicapped. The power to provide services and facilities for people in groups falling outside subsection (8) is subject to the consent of my right honourable friend the Secretary of State for Social Services. That consent was given in a circular issued by the DHSS back in 1974 which made it clear that social services authorities could, if they wished, provide free or subsidised travel for all people in these groups. That is the law in this country.

In Scotland, to turn specifically to Amendment No. 232A, the same powers are available but are available to the regional and island councils. Your Lordships will know that the reason for this is that the regional and island councils have the combined powers of social services and transport within those councils.

To your Lordships who ask, "Would it not be better if, instead of the social services departments, the power to identify and to give help under the 1974 circular was in fact transferred to the transport authorities?" I remind your Lordships that the identification of the needs of disabled people is not an easy matter. It requires an expertise which the social services departments operating at county level possess but which will not be available to their colleagues in the districts. As I said, this problem does not arise in Scotland where the transport and social work functions are invariably operated by the same level of authority.

An authority without this expertise, which is solely concerned with the operation of a concessionary fares scheme that requires no detailed consideration of need on an individual basis, would find it difficult to cope with the more specific needs of disabled people. Resources which might best be devoted to meeting other, non-transport needs could be diverted into providing concessions on which perhaps a little more thought and expertise might have given a rather more refined decision.

Basically, that is the reason why the law has been as it stands at the moment, and the Bill is not proposing to change the law. The existing powers in the Bill allow all authorities the power to provide concessions for people suffering from severe physical handicaps whose transport problems are manifest. I repeat, for the reasons I have given, that we feel that the bodies best placed to consider the needs of the wider group of disabled referred to in these amendments are the social services authorities.

I am sorry that I am appearing unfriendly on this amendment. The point is a familiar one. As I believe one noble Lord said, it has been gone through at practically every stage of the Bill in both Houses. We feel that the law is more satisfactory as it stands and has stood for a long time. For that reason I resist these amendments.

Baroness Stedman

My Lords, I am not at all happy with the Minister's response to this group of amendments. It is going to be very difficult for the authorities to provide special facilities through their social services for these categories of people who cannot be included in the general scheme.

We have reached the position where in the shire counties the district councils will not be able to do much about it because they are not social service authorities. In the metropolitan areas the PTAs will not be able to do anything because they are not social service authorities. In any case, even if in the metropolitan areas the districts try to take on something like this the difficulties are that many are in, or at, a penalty situation with their rates. Will there be any adjustment in their GREA to enable them to take on all these extra responsibilities and services? Perhaps a general concession could have covered all this.

I am not happy but with the leave of the House I will withdraw Amendment No. 231 and not move Amendment No. 232, but I hope that our colleagues will press for the other amendment.

Amendment, by leave, withdrawn.

Lord Underhill moved Amendment No. 231A: Page 96, line 13, leave out ("eighteen") and insert ("nineteen").

The noble Lord said: My Lords, this is a very simple but important amendment which I hope the Minister will find it possible to accept. Clause 90(8) includes in the list of persons who are eligible to receive travel concessions the following: persons whose age exceeds sixteen years but does not exceed eighteen years and are undergoing full-time education".

The noble Lord, Lord Tordoff, referred to a letter from Mr. Fawcett at the Department of Transport to the AMA, of which, as your Lordships know, I am the president. This letter said that the status quo applies under the Bill.

It may be argued that a person does not exceed 18 years until the day before that person is 19. That might be a matter for argument. However, at least one major authority has interpreted this as meaning that when a person actually exceeds 18 years of age and is in full-time education he is no longer eligible for travel concessions. Therefore in the amendment we propose to alter the 18 years provision to 19 years of age. That would then cover persons who are in the upper-sixth form and other individuals who should remain in a position to receive concessionary fares throughout their period of education.

Even if the legal interpretation of when a person reaches the age of 19 is the day before that person's 19th birthday it could be that that date would be reached during the year of education. Therefore we believe the age should be extended to 19 years so that all those in receipt of travel concessions receive them up to the age of 19 throughout their educational year. I beg to move.

Lord Swinfen

My Lords, I support this amendment. There are a large number of children who do not finish their full-time education until after they have taken their A-levels. A number sit their A-levels when they are 18. Some, because their birthday falls during the year, will sit their A-levels at the age of 19. In my own family one of my daughters was ill and was therefore put back a year. As a result she took her A-levels at the age of 19. She is not the only youngster who might get ill and drop a year. This is not an uncommon occurrence and I think it is quite wrong that those whose education is delayed for a year through illness or who sit their A-levels when they are 19 because of the time of year when they were born should be discriminated against.

Lord Belstead

My Lords, the categories of children defined in Clause 90(8)(b) and (c) are those contained in the Travel Concessions Acts 1955 and 1964, which referred to district council operations. These definitions include all those who are not babes in arms and who have not reached their 17th birthday, and anyone in full-time education who has not reached his or her 19th birthday. This is now the law and covers virtually all children who are still at school. Though I have taken on board what my noble friend Lord Swinfen has said (and perhaps I may return to that before I finish) I say to the noble Lord, Lord Underhill, that we know of no scheme at present extending beyond the 19th birthday; and, if I may say so, I think that the definition is quite clear. As I understand it, the noble Lord's case was that the definition was not clear. With respect, I think that it is.

I realise that what I am not doing giving this reply is giving satisfaction to my noble friend, who is saying in effect that he would like older childen to be brought into the categories of those who receive travel concessions. Travel concessions are a discretionary matter for local authorities, anyway, and of course if a local authority wished and felt it could do so it could include older children. But on the grounds that my noble friend gave, even though he was persuasive in what he said, I do not feel that it would be right to change the law. I must admit that that is not what we are intending to do in Clause 90.

Lord Underhill

My Lords, the noble Lord the Minister has said that the reference in subsection (8)(c) is quite clear. I asked what the definition was.

Lord Belstead

My Lords, I have given the definition.

Lord Underhill

What does "exceed eighteen years" mean, my Lords? Does it mean that you do not exceed 18 years until the day before your 19th birthday? That is what some people suggest. But even if that is the case, the point that I made, which was supported by the Minister's noble friend, was that under certain circumstances there will be young persons who are still in receipt of full-time education when they have actually reached the age of 19, and we can see no reason why they should be discriminated against. I think the case put by the Minister's noble friend was a very strong case.

Lord Belstead

My Lords, that is the case I am resisting.

Lord Underhill

My Lords, if the noble Lord is to resist it, I want to say that, while I shall refrain from dividing the House at this stage, there is a very important principle here and we should consult not only with travel interests but with education interests and maybe look at this again on Third Reading.

Lord Belstead

Not content, my Lords!

The Deputy Speaker (Lord Nugent of Guildford)

My Lords, may I ask the noble Lord if he wishes to withdraw the amendment?

Lord Underhill

My Lords, in view of the definite refusal of the noble Lord the Minister we shall consult not only with the transport interests but also with those who are greatly interested in education and will look at the matter again with a view possibly to bringing this forward at Third Reading. Meanwhile, I beg to withdraw the amendment.

Lord Belstead

Not content, my Lords!

The Deputy Speaker

My Lords, I must put the Motion, That this amendment be agreed to.

6.34 p.m.

On Question, Whether the said amendment (No. 231A) shall be agreed to?

Their Lordships divided: Contents, 59; Not-Contents, 82.

DIVISION NO. 3
CONTENTS
Airedale, L. Collison, L.
Attlee, E. Crawshaw of Aintree, L.
Aylestone, L. David, B.
Bernstein, L. Dean of Beswick, L.
Blease, L. Donaldson of Kingsbridge, L.
Boston of Faversham, L. Donoughue, L.
Brockway, L. Fisher of Rednal, B.
Bruce of Donington, L. Gallacher, L.
Carmichael of Kelvingrove, L. Glenamara, L.
Cledwyn of Penrhos, L. Graham of Edmonton, L.
Hampton, L. Morton of Shuna, L.
Hanworth, V. Mulley, L.
Hatch of Lusby, L. Nicol, B.
Houghton of Sowerby, L. Ogmore, L.
Irving of Dartford, L. Parry, L.
Jacques, L. Ponsonby of Shulbrede. L. [Teller.]
Jeger, B.
Jenkins of Putney, L. Ritchie of Dundee, L.
John-Mackie, L. Silkin of Dulwich, L.
Kilbracken, L. Stallard, L.
Llewelyn-Davies of Hastoe, B. Stedman, B.
Lockwood, B. Stewart of Fulham, L.
McIntosh of Haringey, L. Stoddart of Swindon, L
McNair, L. Swinfen, L.
Mellish, L. Taylor of Blackburn, L
Meston, L. Tordoff, L. [Teller.]
Milner of Leeds, L. Underhill, L.
Mishcon, L. Wallace of Coslany, L.
Molloy, L. Wells-Pestell, L.
Monkswell, L. White, B.
NOT-CONTENTS
Airey of Abingdon, B. Lindsey and Abingdon. E.
Allenby of Megiddo, V. Long, V.
Belhaven and Stenton, L. Lucas of Chilworth, L.
Belstead, L. Lyell, L.
Bessborough, E. McAlpine of West Green. L.
Brabazon of Tara, L. Mancroft, L.
Brougham and Vaux, L. Margadale, L.
Butterworth, L. Marley, L.
Caithness, E. Merrivale, L.
Cameron of Lochbroom, L. Mersey, V.
Carnegy of Lour, B. Monk Bretton, L.
Camock, L. Mottistone, L.
Coleraine, L. Mowbray and Stourton, L.
Colwyn, L. Napier and Ettrick, L.
Cowley, E. Nugent of Guildford, L
Craigavon, V. Orr-Ewing, L.
Daventry, V. Pender, L.
Davidson, V. Reay, L.
Denham, L. [Teller.] Renton, L.
Elles, B. Rochdale, V.
Elliot of Harwood, B. Rodney, L.
Elliott of Morpeth, L. Russell of Liverpool, L.
Elton, L. St. Davids, V.
Foley, L. Sanderson of Bowden, I
Fraser of Kilmorack, L. Selkirk, E.
Glanusk, L. Skelmersdale, L.
Glenarthur, L. Strathspey, L.
Gray of Contin, L. Sudeley, L.
Greenway, L. Swinton, E. [Teller.]
Gridley, L. Tranmire, L.
Hardinge of Penshurst, L. Trefgarne, L.
Hayter, L. Trumpington, B.
Henderson of Brompton, L. Vaux of Harrowden, L.
Henley, L. Vickers, B.
Hives, L. Vivian, L.
Hood, V. Ward of Witley, V.
Hooper, B. Whitelaw, V.
Hylton-Foster, B. Wolfson, L.
Inchcape, E. Wynford, L.
Lane-Fox, B. Young of Graffham, L.
Lawrence, L. Ypres, E.

Resolved in the negative, and amendment disagreed to accordingly.

6.42 p.m.

[Amendment No. 232 not moved.]

Lord Carmichael of Kelvingrove moved Amendment No. 232A:

[Printed earlier.]

The noble Lord said: My Lords, I beg to move.

Lord Tordoff

My Lords, the noble Lord has said that the law has not been changed. That may be true in relation to what he is saying, but the fact is that the mechanism has been changed. Unless we make the change set out in the amendment, people will not be able to do things which they have done in the past in relation to travel concessions for the mentally handicapped and the other people we have been discussing.

Lord Belstead

My Lords, I have already spoken to this amendment.

6.43 p.m.

On Question, Whether the said amendment (No. 232A) shall be agreed to?

Their Lordships divided: Contents, 61; Not-Contents, 82.

DIVISION NO. 4
CONTENTS
Airedale, L. Llewelyn-Davies of Hastoe, B.
Attlee, E. Lockwood, B.
Aylestone, L. McIntosh of Haringey, L.
Bernstein, L. McNair, L.
Blease, L. Mellish, L.
Boston of Faversham, L. Meston, L.
Brockway, L. Milner of Leeds, L.
Carmichael of Kelvingrove, L. Molloy, L.
Cledwyn of Penrhos, L. Monkswell, L.
Collison, L. Morton of Shuna, L.
Crawshaw of Aintree, L. Mountevans, L.
David, B. Mulley, L.
Dean of Beswick, L. Nicol, B.
Donaldson of Kingsbridge, L. Ogmore, L.
Donoughue, L. Parry, L.
Elwyn-Jones, L. Ponsonby of Shulbrede, L. [Teller.]
Fisher of Rednal, B.
Gallacher, L. Ritchie of Dundee, L.
Gladwyn, L. Shepherd, L.
Glenamara, L. Silkin of Dulwich, L.
Graham of Edmonton, L. Stallard, L.
Hampton, L. Stedman, B.
Hanworth, V. Stewart of Fulham, L.
Hatch of Lusby, L. Stoddart of Swindon, L.
Houghton of Sowerby, L. Taylor of Blackburn, L.
Irving of Dartford, L. Teviot, L.
Jacques, L. Tordoff, L. [Teller.]
Jeger, B. Underhill, L.
Jenkins of Putney, L. Wallace of Coslany, L.
John-Mackie, L. Wells-Pestell, L.
Kilbracken, L. White, B.
NOT-CONTENTS
Airey of Abingdon, B. Elton, L.
Allenby of Megiddo, V. Foley, L.
Belhaven and Stenton, L. Fraser of Kilmorack, L.
Belstead, L. Glanusk, L.
Bessborough, E. Glenarthur, L.
Brabazon of Tara, L. Gray of Contin, L.
Brougham and Vaux, L. Greenway, L.
Butterworth, L. Gridley, L.
Caithness, E. Hardinge of Penshurst, L.
Cameron of Lochbroom, L. Henderson of Brompton, L.
Camegy of Lour, B. Henley, L.
Camock, L. Hives, L.
Coleraine, L. Hood, V.
Colwyn, L. Hooper, B.
Cowley, E. Hylton-Foster, B.
Craigavon, V. Inchcape, E.
Daventry, V. Kitchener, E.
Davidson, V. Lane-Fox, B.
Denham, L. [Teller.] Lindsey and Abingdon, E.
Elles, B. Long, V.
Elliot of Harwood, B. Lucas of Chilworth, L.
Elliott of Morpeth, L. Lyell, L.
McAlpine of West Green, L. Sanderson of Bowden, L.
Mancroft, L. Selkirk, E.
Margadale, L. Skelmersdale, L.
Marley, L. Strathcarron, L.
Merrivale, L. Strathspey, L.
Mersey, V. Sudeley, L.
Monk Bretton, L. Swinton, E. [Teller.]
Mottistone, L. Tranmire, L.
Mowbray and Stourton, L. Trefgame, L.
Napier and Ettrick, L. Trumpington, B.
Nugent of Guildford, L. Vaux of Harroden, L.
Orkney, E. Vickers, B.
Orr-Ewing, L. Vivian, L.
Pender, L. Ward of Witley, V.
Reay, L. Whitelaw, V.
Renton, L. Wolfson, L.
Rochdale, V. Wynford, L.
Rodney, L. Young of Graffham, L.
St. Davids, V. Ypres, E.

Resolved in the negative, and amendment disagreed to accordingly.

6.50 p.m.

The Earl of Caithness moved Amendment No. 233: Page 96, line 22, leave out subsection (9) and insert—

  1. (a) means the council of a county or district in England and Wales or a regional or islands council in Scotland; and
  2. (b) includes also, in relation to England and Wales, a metropolitan county passenger transport authority.").

The noble Earl said: My Lords, in moving this amendment I should like at the same time to speak to Amendments Nos. 234 and 384. Amendment No. 234: Page 96, line 31, leave out from beginning to ("to") in line 36 and insert ("references—

  1. (a) except in a case to which paragraph (b) below applies, to the authority concerned in establishing the scheme or, where two or more authorities are so concerned, to both or all those authorities acting jointly; or
  2. (b) where the authority or one of the authorities concerned in establishing the scheme are a Passenger Transport Authority for a passenger transport area in England and Wales,").
Amendment No. 384: Clause 132, page 134, line 17, at end insert (" (including different purposes of the same provision) ").

These amendments are consequential upon enactment of the Local Government Act 1985. I beg to move.

On Question, amendment agreed to.

The Earl of Caithness moved Amendment No. 234:

[Printed above.]

On Question, amendment agreed to.

Clause 91 [Reimbursement for travel concessions under schemes]:

The Earl of Caithness moved Amendments Nos. 235 and 236: Page 97, line 16, leave out ("and"). Page 97, line 21, at end insert—

The noble Earl said: My Lords, with the leave of the House, I should like to move Amendments Nos. 235 and 236 together.

These amendments seek to give the Secretary of State the power to make regulations which govern the extent to which an authority may contract out the administration of a concessionary fares scheme to another party. Although the statutory responsibility for the management of a scheme and its reimbursement arrangements rests with the authority concerned, there may be instances where that authority wishes to use the expertise of other bodies; for example, a district might, by agreement, use the resources of county council staff for collecting and analysing data on passengers and apportioning payments to operators; or, alternatively, it might commission independent consultants for this purpose. We do not wish to discourage this sort of practice, which may indeed result in greater efficiency. It would not, however, be appropriate to allow one operator to run a scheme in which others participate since this might be seen by the other operators as acting to their disadvantage. That is why we feel it is appropriate for the Secretary of State to have the power to regulate this.

These amendments will not—I repeat, "will not"—affect the basic duties that the legislation places on a local authority which establishes a concessionary fares scheme, and it will be held accountable by the Secretary of State in the event of any application by an operator relating to compulsory participation. Rather, the intention is to impose a modest limitation on what authorities may do in the mechanics of operating their scheme. I beg to move.

On Question, amendments agreed to.

The Earl of Caithness moved Amendments Nos. 237 and 238: Page 97, line 25, after ("may") insert ("from time to time"). Page 97, line 27, leave out ("on their admission to participation in the scheme").

The noble Earl said: My Lords, with the leave of the House, I should like to move Amendments Nos. 237 and 238 en bloc. These amendments recognise that it may periodically be necessary for authorities and operators to renegotiate the arrangements for reimbursement and concessionary fare schemes. For example, it may happen that a local authority wishes to use electronic data capture methods to establish eligibility for reimbursement rather than periodic surveys. Where such a change occurred it would amount to formulating new arrangements. As now drafted, the clause appears to allow negotiation only when an operator is first admitted to participation. The amendments therefore allow for the possibility of periodic renegotiation. I beg to move.

On Question, amendments agreed to.

Clause 93 [Right of eligible service operators to participate in travel concession schemes]:

The Earl of Caithness moved Amendment No. 239.

[Printed earlier.]

On Question, amendment agreed to.

Following is the text of the amendment (No. 239): Page 99, line 15, leave out ("is a relevant service for the purposes of") and insert ("runs or will run between places within the limits covered by").

Clause 94 [Compulsory participation in travel concession schemes]:

Lord Carmichael of Kelvingrove moved Amendment No. 240: Page 101, line 24, at end insert— ("( ) Where an operator has failed to agree a modification of the current reimbursement arrangements in accordance with sections 93(4) or 93(5) of this Act, the authority or authorities may at any time issue a participation notice in accordance with subsection (2) above which shall take into account such modification of current reimbursement arrangements for eligible service operators as may be considered appropriate with regard to the service in question and commensurate with the level of reimbursement generally applicable in the principal area covered by the scheme.").

The noble Lord said: My Lords, I would have preferred in many ways that we had been able to take this amendment after dinner. However, progress has been rather more rapid than we expected and we must take it now. My purpose in proposing the amendment is to draw attention to the complications that we have arrived at in the whole question of travel concessions. In the Bill as it stands, travel concessions extend to no less than 12 clauses and cover 15 pages of extremely complex draft legislation. This stands in sharp contrast to the single, comparatively simple clause to be found in the 1968 Transport Act.

One of the difficulties of even debating any of this is that it is so complex that it becomes extremely difficult to unravel and understand. This is despite the fact that the Minister provided notes on clauses which were specially reissued during the Committee stage. However, even the notes on clauses are not easily digested. It seems a great pity that the Government draftsman could not have produced one straight-forward clause that gave operators a right to participate in the scheme, scope for the obligation to be imposed where necessary and the corresponding right of appeal with adjudication over the level of reimbursement. As it is, the Bill presents a maze. This amendment is designed to highlight some of the important issues that are still a cause for concern.

The amendment focuses on one particular point relating to the inclusion of services on which high or premium fares are charged where a concessionary fares scheme is to be applicable. Clause 93(4) contains an allowance that a local authority which has a concessionary fares scheme can reduce its payments to an operator for such concessions where, in the local authority's view, the fares charged are significantly higher than for comparable services within the rest of the local authority's area.

It also provides that an operator cannot force the local authority to include his service within the concessionary scheme unless he agrees to a modified rate of reimbursement. Subsection (5) goes on to empower a local authority to exclude an operator with premium fares from a scheme if the operator and the local authority are unable to agree a satisfactory modification to the reimbursement arrangements.

My fear with regard to these proposals and the reason for the amendment is that some operators who are in a monopolistic position—it would be silly to think that no such situation will arise when the new regime is in force—could actually use these provisions as a means of eliciting more money from the local authorities. It is easy to foresee circumstances where an operator may provide services in a predominantly rural area where the bulk of his passengers are entitled to concessions. By charging a high basic fare, he is able to operate a lucrative commercial service in the expectation that a significant proportion of his income will be paid by a local authority by means of the reimbursement on concessionary fares.

Where this major market is for schoolchildren and for pensioners, both of whom carry concessions—there are many rural areas where those who use the services are practically all schoolchildren or elderly people—it is inconceivable that a reasonable local authority would be willing, because of disagreement with the operator, to exclude the service from the scheme if the operator refused to accept a reduced level of concession. The authority will want to make the operator participate, but at a reasonable price. The purpose of the amendment is to give local authorities the right to maintain concessionary fares on a so-called "special amenity" fare, which is a high fare, but to oblige the operator to accept a lower level of compensation. The operator, of course, would then have the facility to appeal as afforded in Section 95(2) if he felt that the lower level of compensation was inadequate.

7 p.m.

There are wider issues involved in this matter. The key issue, which I think all these clauses address, is the means by which authorities will be able to maintain past schemes in the new regime. The slightest possibility that an operator could easily opt out would place a local authority in an extremely weak negotiating position. If the cost of such schemes rises dramatically, then the likelihood of any authority being able to maintain them must be in serious doubt.

Financial constraints which the Government are imposing, particularly in the metropolitan areas, must mean that many concessions will be reduced in value. But the main concern has been to ensure that if a scheme is run then it will be available to all comers on all services. It is for this reason that the Government changed the obligation to one where the local authority can compel operators to offer concessions in accordance with the local scheme. However, despite that change it is very clear that there is a real risk that the past schemes could be abandoned and that token schemes—of which we all know the dangers—could be re-introduced. It has even been suggested that it could reach the point that not only token schemes but brand-specific token schemes (to use the jargon words) could be proposed; that is, one operator accepting only his own tokens in any particular area, which would be very confining to many people who use the service. Instead of having the freedom to move around they would need to use the tokens issued by the particular individuals.

This is the first opportunity we have had to discuss the many new clauses that were put down during the Committee stage of the Bill. It is perhaps stretching the amendment to bring in some of the points I have tried to raise, but I think that the Minister should be aware that the concessionary scheme is a vital part of life for many millions of people in the country, and if that were taken away, or if it were in any way weakened, it would greatly reduce the quality of life for many people.

I hope that the Minister will be able to look at it very carefully. We have only a week before Third Reading, and I know that there are many discussions going on with experts on both sides; but certainly there are many gaps in the scheme of the Bill as it exists that could allow a great deal of abuse of any concessionary scheme. I hope that the Minister will take that into account. I beg to move.

Lord Tordoff

My Lords, while we are in a probing mood, may I say that I thoroughly endorse everything that the noble Lord, Lord Carmichael of Kelvingrove, has said, particularly in relation to travel passes. In earlier stages of the Bill one has said how welcome these schemes are and how unwelcome a fall-back to token schemes would be. The token schemes are simply not as good as the passes which can be used over wide areas. I have referred in the past to the scheme in Lancashire which is a wonderful example of what can be done. That is a scheme which was intended to be extended into Greater Manchester, and Greater Merseyside, but which may now fall by the wayside.

May I ask two unrelated questions of the Government? I do not necessarily ask for an answer now, but they are related in the sense that they are probes on this question of concessionary fares. The first question concerns travel concessions for the unemployed. A number of authorities run travel concessions for the unemployed; some deemed to be commercial, but not all. Legal opinions have varied over the years but it is accepted that there are no specific powers relating to this category. Under this Bill operators can continue a concession on commercial services as a commercial proposition. However, on a subsidised series this is not the case; and local authorities may perhaps be unable to include a concession because the Bill makes it clear that subsidised service contracts cannot offer concessionary fares other than for the categories included in the Bill. I am asking whether it is the Government's intention that concessions for the unemployed should end. That would be the result if the subsidised series cannot be covered and the operators lose general financial support which encourages their present "work-seeker" tickets.

I am sure that we can have a reassurance on the other question which has troubled a lot of people, but I think we should have it on the record in the House tonight. A few parish councils operate token-based concessionary schemes under the tuppenny rate provision of Section 137 of the Local Government Act 1972. Can the Government confirm that nothing in the Bill affects the powers of parish councils to go on doing this?

Lord McIntosh of Haringey

My Lords, may I add a few words from personal experience of the relationships between a local authority and an operator on concessionary fares schemes. I served on the Transport Committee of the Greater London Council for a number of years. We always felt that we were at a severe disadvantage when facing London Transport's claims for rate support in respect of the concessionary fare scheme. The problem was that they claimed that they were losing large amounts of revenue—I remember it being of the order of £30 million or £40 million many years ago—and it was always very difficult to substantiate whether those claims were reasonable or not. They claimed that they carried out surveys of the number of people using concessionary fare passes and they grossed up these surveys from a sample to give their financial figures. However, they were never able to convince me personally—and I am a believer in sample surveys; I earn my living by them—that they could distinguish adequately between revenue lost on journeys which would have taken place anyway and additional ridership, additional traffic generation, for journeys which would not otherwise have taken place.

One of the main benefits, we always thought, of the free travel for old age pensioners was that it was in fact increasing the mobility of older people. It was making it possible for them to get around London free in off-peak periods; and this was a very good alternative in social, and probably financial, terms rather than their being housebound, although the social terms are by far the most important.

The difficulty which I see with the multiplicity of operators which we shall now have is that the position of the local authorities—who have to determine the claims for reimbursement of concessionary fare schemes—will be even more difficult to argue because the operators will argue between themselves as well as with the authority. It will be even more difficult to determine to what extent there is increased ridership and traffic generation. If there is any suggestion at all that an operator can threaten to withdraw a service if the subsidy for concessionary fares is not adequate, frankly, the local authority will be over a barrel. The local authority will not be able to resist such pressure for fear of the service being withdrawn altogether. The word "blackmail" is not too strong a word to use for what might well occur.

I do not claim to understand the amendment which my noble friend Lord Carmichael has put down. I do not claim for one moment that this amendment reflects the whole range of concerns which there must be on this enormously complex issue of concessionary travel. But I say that it is the responsibility of Government to provide a simpler and more understandable way of dealing with the matter than is set out in the 12 clauses and 15 pages which cover this concessionary fare scheme. If it cannot be explained adequately even in the Notes on Clauses, how will it be clear to the operators and to the local authorities? How will the ratepayers ensure that they are not being defrauded? No, defrauded is not the correct word. How will they ensure that they are not paying too much for the concessionary fare schemes in whatever form they finally emerge?

Lord Belstead

My Lords, it has been interesting to hear noble Lords speak about the concessionary fares, and I make no complaint at all that the debate has gone a good deal wider than the amendment because the noble Lord, Lord Carmichael, with justice, said that the provisions on concessionary fares are complex and we did not really have the opportunity to go into them deeply during the previous stages of the Bill.

First, I shall seek to reply to the noble Lord's amendment, which I have to say would breach the principle that an operator should not be compelled to accept reimbursement at a rate which does not cover the full cost of the concession which he is providing. We believe that, as they stand, the provisions of the Bill represent a proper compromise between the rights of the operator, who is able to operate the option to participate in the concessionary fare scheme if he wishes, and those of the authority, which cannot be compelled to provide reimbursement on the basis of higher fares which reflect a specific amenity element. It is the amenity which is the point of this particular amendment. If the authority for its part wishes to ensure that a service of this kind is covered by the scheme, then it may make use of its powers of compulsory participation; but in that case, as we all know and as the Bill is drafted, it must be prepared to reimburse the operator on the basis of the higher fares which the operator is charging. We feel that if authorities were given the power to force an operator to accept reimbursement at the lower rate, it would be a serious disincentive to establishing specialised services where there is a market for them, and would reduce the diversity of services available to the general public.

Having said that, let me reply to the point which the noble Lord, Lord Carmichael, made—namely, what happens if we have a more or less monopolistic situation and the operator simply begins to jack-up the fares? Noble Lords perhaps will predict the answer which I shall give, but I am going to give it, nonetheless. The noble Lord's question points to one of the advantages of the Bill. It is in a case of that kind, when there is an operator who is beginning to behave in an unreasonable way, that another operator will simply come in and take the available business away. It is really inconceivable that somebody will literally take the public for a ride without somebody coming in and saying to the public, "Come and use my buses".

Lord McIntosh of Haringey

My Lords, I hope that the noble Lord will forgive me for interrupting, but I do not think he meant to say, "literally take the public for a ride". I think he meant to say, "metaphorically".

Lord Belstead

Yes, my Lords, I meant metaphorically. That is my answer to the important question raised by the noble Lord, Lord Carmichael. However, I point out that it is one of the advantages of the Bill as regards the encouragement which it gives to competition.

The noble Lord, Lord Tordoff, asked me important questions about travel concessions for the unemployed and those cases where travel concessions are given under the tuppenny rate powers of the parish councils. As I understand it, authorities do not have any statutory powers to provide concessions for unemployed people at their own expense because this is being carried out as a result of a commercial as well as a social judgment by the local authorities. The Bill makes no change in that respect. However, some authorities are already providing concessions on a self-financing basis and the Bill will not affect those. I believe I am right in saying that Tyne and Wear, which we have already debated, does precisely that in respect of the Metro.

The noble Lord, Lord McIntosh, quite reasonably said that, with the different system under the Bill—and, as the Government hope, with a greater diversity of operators—it will be more difficult for local authorities to ensure that they strike the right deal on behalf of their ratepayers as well as in the interests of passengers. The noble Lord had every reason to say that. All I can say, without embarking on the matter this evening, is that the regulations will take the generation of patronage very much into account in the reimbursement calculation. The department will be giving guidance to authorities on this matter. Meanwhile, as the noble Lord may have read, there is also some guidance on concessionary fares in, I think I am right in saying, the tendering consultation document which has already been sent out.

Lord Tordoff

My Lords, will the Minister reassure us about the parishes?

Lord Belstead

My Lords, I apologise. So far as concerns the parishes, I can reassure the noble Lord, Lord Tordoff, that nothing affects the power under Section 137 of the Local Government Act 1972 for parishes, if they so wish, to give concessions under the tuppenny rate power.

Lord Carmichael of Kelvingrove

My Lords, although I have heard what the Minister has to say, I am sure he will realise that there is still a great deal of dissatisfaction. I am sorry that we have not had time to go into what I consider will be one of the fundamental questions—that is, the concessionary schemes and whether or not tokens will be used. That will be something which will be of great annoyance to very many people and also a threat to a great many people. However, having heard what the Minister has had to say and realising how short a time we have left, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Brabazon of Tara

My Lords, I think that we have reached a suitable moment for me to propose that we adjourn further consideration on Report until 8 o'clock.

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

[The Sitting was suspended from 7.16 until 8 p.m.]

Consideration of amendments on Report resumed.

The Earl of Caithness moved Amendment No. 241: Page 101, line 42, leave out ("arrangements for reimbursement of") and insert ("reimbursement arrangements for").

The noble Earl said: My Lords, I beg to move Amendment No. 241 and speak to Amendment No. 282. Amendment No. 282: Page 112, line 17, at end insert—

  1. ("(bb) references to the current reimbursement arrangements for eligible service operators participating in any scheme under section 90 of this Act shall be read in accordance with section 91(5) of this Act;
  2. (bc) references to a participation notice shall be read in accordance with section 94(2) of this Act;").

These are two drafting amendments. I beg to move.

On Question, amendment agreed to.

The Earl of Caithness moved Amendments Nos. 242 and 243: Page 102, line 14, leave out ("on journeys on any service operated by him"). Page 102, line 20, leave out from ("Where") to first ("date") in line 28 and insert ("a notice is served on an operator under subsection (6) above the preceding provisions of this section shall apply, on and after the date when the variation in question takes effect, in relation to any obligation of that operator under subsection (2) above to provide travel concessions in accordance with the scheme in question which—

  1. (a) was current at the date of the notice; and
  2. (b) does not cease (by virtue of subsection (8) above or otherwise) before the date when that variation takes effect;
as if the latter").

The noble Earl said: My Lords, with the leave of the House, I beg to move Amendments Nos. 242 and 243 en bloc. These are drafting amendments. I beg to move.

On Question, amendments agreed to.

Clause 95 [Further provisions with respect to participation notices]:

Lord Teviot moved Amendment No. 244: Page 103, line 22, at end insert— ("( ) Where an operator has submitted an application in respect of a participation notice under subsection (2) above, he shall not be obliged to provide any travel concessions required by that notice in accordance with section 94(2) until his application has been determined under subsection (5) below.").

The noble Lord said: My Lords, may I say on behalf of the noble Lord, Lord Shepherd, that he has asked me to move this amendment. He has to go to Berlin, and is on his way via Hamburg tonight. So he is not here. Together with his Amendment No. 244, I should like to speak to Amendments Nos. 246,247,250,251, 252 and 254. Amendment No. 246: Page 103, line 35, at end insert ("with or"). Amendment No. 247: Page 103, line 36, at end insert ("from such date as he may specify"). Amendment No. 250: Page 104, line 7, leave out ("Any") and insert ("No"). Amendment No. 251: Page 104, line 7, leave out ("which has") and insert ("shall"). Amendment No. 252: Page 104, line 9, leave out from ("notice") to end of line 15. Amendment No. 254: Clause 97, page 105, line 7, leave out subsections (2) to (4).

Even before this moment I was in somewhat of a dilemma because Amendments Nos. 246, 247, 250 to 252, and 254 which I have tabled in respect of Clauses 95 and 97 have a similar objective to the amendment of the noble Lord, Lord Shepherd, but are incompatible with that of my own Front Bench. I should like to have urged your Lordships to support my own amendments but, if they were made, they would immediately be nullified by Amendments Nos. 248 and 249 in the name of my noble friend Lord Belstead.

In these circumstances, I give notice that it may be necessary for me to raise this matter again on Third Reading, although that stage seems to be getting rather full and it would be nice if we could deal with it tonight. If your Lordships' House were to accept the amendment of the noble Lord, Lord Shepherd, this course would not be necessary.

I now move on to Lord Shepherd's notes. I like a rather quiet, prepared speech and the noble Lord does off-the-cuff stuff, so I ask your Lordships to bear with me. This amendment seeks to reintroduce a level of fairness to the operator, who is compelled by a participation notice served on him under Clause 94(2) to take part in local authority concessionary fare schemes. As it stands in the Bill, the operator may apply to the Secretary of State for cancellation or variation of the notice on the grounds that there are special reasons why his participation would be inappropriate, or that the reimbursement arrangements are not appropriate, that is, adequate, for operators obliged to participate.

Travel concessions for elderly, blind and disabled people are a much valued benefit and it is right that the concessionary schemes should be open to all operators. However, there is deep concern about the requirement compelling an operator to participate in a scheme accompanied by the ability of the local authority to determine the extent and method of reimbursement.

An individual local authority could in practice propose a scheme of reimbursement which would fail to accord to the principle that operators should be no better or worse off as a result of making the concessions available. In that event, the operator could well apply to the Secretary of State for the variation or cancellation of the participation notice on the grounds of the inadequate level of reimbursement of a particular scheme. But he would have to continue offering the concession while his application was being considered. This could place a serious financial burden on that operator and could have dire financial consequences for him for three reasons: first, the relevant provisions in the Bill (Clauses 97(2) and 97(4) offer no guarantee of subsequent compensation payments—only the possibility; secondly, even if the operator is granted compensation under these provisions, it may be inadequate to cover any financial loss; and thirdly his compulsory participation may well have caused the operator concerned to experience interim cash flow problems and any subsequent compensation might be too late to remedy his financial difficulties.

No doubt in the vast majority of cases the co-operation between local authorities and operators will continue and the concessionary fare schemes that will be available will work well to the benefit of both the beneficiaries and the operators, but it is against natural justice that an operator could be forced into a position of having to offer reduced concessionary fares or even free travel in a particular scheme which would result in his making a loss. This amendment seeks to make things a little fairer for the operator by providing that he will not be obliged to provide a travel concession until his application for the cancellation or variation or the participation notice has been determined.

Travel concessions in a limited way have been available in some towns and cities for the past 30 years or so, but it was the Transport Act 1968 which gave power to all local authorities to provide these concessions and to reimburse the operators concerned. The many schemes in operation now vary considerably from completely free travel for elderly, blind and disabled people to schemes where a small concession is provided. There are however some areas where, for one reason or another, one or more classes of beneficiary do not enjoy the benefit of schemes. This amendment, although tabled, was not moved at the Committee stage because of the volume of late and complex Government amendments. I beg to move.

Lord Belstead

My Lords, it is an underlying principle in regulations which are to be made on reimbursement that an operator should be left no better, but no worse, off from his participation in a concessionary fare scheme. Where an authority fails to discharge its obligation under Clause 90(7) to reimburse an operator, the Secretary of State may cancel the notice of compulsory participation

To complement this, during the Committee stage we introduced additional provisions specifically designed to meet the objections that have been raised to compulsory participation before applications to the Secretary of State have been determined by allowing my right honourable friend to award compensation in such cases, assessed as covering any loss suffered by the operator during the period before my right honourable friend had reached his decision.

When the provisions for compulsory participation were introduced in another place the intention was that an authority should be able to ensure full coverage of all services. The amendments to Clause 95 would undermine that principle by delaying participation in any case where the operator made an application, and could mean that groups of concessionary travellers, such as the elderly or children, would be deprived of reduced fare travel for a considerable period.

I rather think that my noble friend's amendments to Clause 97—in fact he has made it clear—are consequential on the amendments to Clause 95. since the power of the Secretary of State to award retrospective compensation would no longer be required under the amendments. But I remind my noble friend that Clause 97(3) and (4), which my noble friend seeks to delete in his amendments, also give the Secretary of State the power to award compensation following his determination of an application for release from compulsory participation under Clause 96. This power is intended to cover the case of an operator who has been subject to compulsion for some time. If the operator finds that sums paid to him no longer provide adequate reimbursement because his concessionary patronage on fares levels changes and the authority has failed to take account of this, he can seek release and can be awarded compensation. I am sure that operators would want these additional safeguard measures.

I assure your Lordships that the Government are meeting the basic point which my noble friend is making about the dangers of inappropriate compulsion by another route, but we are meeting them nonetheless. It is on those grounds that I hope my noble friend will feel satisfied and may feel able to withdraw his amendment.

Lord Teviot

My Lords, I shall read carefully what my noble friend has said. I do not think I can do much more than withdraw this amendment.

Amendment, by leave, withdrawn.

The Earl of Caithness moved Amendment No. 245: Page 193, line 32, leave out subsection (5) and insert— ("(5) Where on any such application the Secretary of State finds the ground mentioned in subsection (1)(a) above established, he may cancel the participation notice or (as the case may require) vary it by excluding from it any service operated by the applicant in respect of which he considers the applicant's participation in the scheme would be inappropriate. (5A) Where on any such application the Secretary of State finds the ground mentioned in subsection (2)(b) above established, he shall cancel the participation notice unles he considers that a direction under subsection (6) below would meet the case.").

The noble Earl said: My Lords, in moving this amendment I shall speak also to Amendments Nos. 248 and 249. Amendment No. 248: Page 104, line 3, leave out ("be") and insert ("require)"). Amendment No. 249: Page 104, line 6, at end insert— ("(6A) If the Secretary of State cancels a participation notice under subsection (5A) above he shall give to the authority or authorities by whom the notice was served a notice in writing indicating in what respects the scheme or (as the case may be) the current reimbursement arrangements for eligible service operators participating in the scheme are inappropriate for application in relation to operators other than operators voluntarily participating in the scheme.").

These are drafting amendments to make clear the remedies available to the Secretary of State in relation to applications under Clause 95(2)(a) and (b). The amendments do not alter the substance of the present subsection (5). I beg to move.

The Deputy Speaker (Lord Hayter)

My Lords, I should point out that if this amendment is agreed to I cannot call Amendments Nos. 246 or 247.

Lord Teviot

I am not paying the slightest attention, my Lords. Is this Amendment No. 258?

The Deputy Speaker

No, my Lords; it is Amendment No. 245. My point is that if this amendment is agreed to I cannot call Amendments Nos. 246 and 247.

On Question, amendment agreed to.

[Amendments Nos. 246 and 247 not moved.]

The Earl of Caithness moved Amendments Nos. 248 and 249:

[Printed above.]

The noble Earl said: My Lords, I have already spoken to these two amendments.

On Question, amendments agreed to.

[Amendments Nos. 250 to 252 not moved.]

Clause 97 [Supplementary provisions]:

The Earl of Caithness moved Amendment No. 253: Page 105, line 6, leave out ("94") and insert ("93").

The noble Earl said: My Lords, during Committee stage your Lordships approved new versions of the travel concession clauses. Clause 93(5) now contains a requirement for notice and this amendment brings that notice within the scope of form and content of regulations. I beg to move.

On Question, amendment agreed to.

The Deputy Speaker

My Lords, if Amendment No. 254 is agreed to I cannot call Amendments Nos. 256 to 260.

[Amendment No. 254 not moved.].

8.15 p.m.

Lord Belstead moved Amendment No. 256: Page 105, line 19, leave out ("the Secretary of State determines") and insert ("on determining an application").

The noble Lord said: My Lords, I have already spoken to this. I beg to move.

On Question, amendment agreed to.

The Earl of Caithness moved Amendment No. 257: Page 105, line 20, leave out ("that an obligation imposed by a participation notice shall cease") and insert ("the Secretary of State finds that the authority or authorities responsible for administration of the scheme in question have failed to comply with their obligation under section 90(7) of this Act,").

The noble Earl said: My Lords, my noble friend has already spoken on this. I beg to move.

On Question, amendment agreed to.

Lord Teviot moved Amendment No. 258: Page 105, line 21, leave out ("may") and insert ("shall").

The noble Lord said: My Lords I tabled this amendment as a fall-back amendment if my earlier amendments had not been made. It is a milder amendment and I shall deal with it briefly. Although your Lordships have not been persuaded to accept the earlier amendments which would have protected bus operators from any possible imposition of unreasonable plans for concessionary fares, I feel your Lordships will accept the legitimacy of this small change.

Clause 97(3) provides that the Secretary of State may award compensation if it appears to him that the applicant suffered loss. The belt and braces of this phraseology is unreasonable. If it appears to the Secretary of State that the operator suffered loss because of the actions of a local authority, he should without doubt award compensation. If we substitute the word "shall" for the word "may" operators will be given greater assurance of equitable treatment when, through no fault of their own, they have been put at a disadvantage by this action. I beg to move.

Lord Belstead

My Lords, perhaps I may make it quite clear to my noble friend that where an operator is shown to have suffered loss as a result of a failure of an authority to administer its reimbursement arrangements properly I have no doubt that my right honourable friend will wish to see that the operator is compensated for this. There is nothing between the Government and my noble friend on that.

My noble friend says that this amendment is wholly reasonable. On the face of it, it is, but there may be a few cases where both parties are at fault. An authority may be failing in its duty to reimburse an operator properly, but the operator for his part may have contributed to that failure by not co-operating in the supply of information. In such circumstances the loss is attributable to both parties and it might not be appropriate for the authority to be penalised for a failure which was in part induced or enhanced by acts or omissions of the operator. For this reason I contend it is right that my right honourable friend should retain discretion in the award of compensation and that the matter should not be absolute.

I hope that my noble friend will accept my assurance that in the generality of cases compensation will be awarded, thereby ensuring the proper reimbursement of operators. But we believe that it is right to retain this discretion.

Lord Teviot

My Lords, my noble friend seems to be entirely fair. I do not think I need bother to read what he said. It seems absolutely clear as mustard.

Noble Lords

Oh!

Lord Teviot

No, my Lords, as clear as whatever. I think it is fine. However, if having read it I find there is anything I wish to raise I shall refer back to it. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Earl of Caithness moved Amendment No. 259: Page 105, line 23, leave out from ("to") to end of line 26 and insert ("that failure").

The noble Earl said: My Lords, on behalf of my noble friend I beg to move.

On Question, amendment agreed to.

The Earl of Caithness moved Amendments Nos. 260 and 261: Page 105, line 33, leave out ("specified in the notice") and insert ("so specified"). Page 106, line 8, leave out ("shall be both joint and several") and insert—

but if any such authority make any payment, in or towards the discharge of that liability, of an amount exceeding the amount representing any proportion specified in the notice as that authority's share, that authority shall be entitled to recover an appropriate contribution (determined by reference to the proportions specified in that notice) from the other authority or authorities concerned.").

The noble Earl said: My Lords, with the leave of the House I beg to move Amendments Nos. 260 and 261 together.

Amendment No. 260 is a simple drafting amendment. Amendment No, 261 is a technical amendment. I beg to move.

On Question, amendments agreed to.

Clause 98 [Enforcement of participation in travel concession schemes]:

Lord Henderson of Brompton moved Amendment No. 262: Page 106, line 16, leave out ("3") and insert ("5").

The noble Lord said: My Lords, I shall move this amendment briefly. It proposes merely to increase the maximum fine for a systematic attempt on the part of an operator to defraud by not complying with a local authority scheme. There is no need for me to say anything further than that a systematic failure by an operator as a deliberate policy to defraud by not complying with a local authority scheme is a serious offence ipso facto and ought to be dealt with as such.

Under the Bill there is merely a level 3 fine with a maximum of £400. My suggestion is that this should be increased to a level 5 fine, with a maximum of £2,000. Considering the gravity of the offence—it is a criminal offence—£400 cannot be the correct ceiling for a systematic failure. The sum of £2,000 must be more realistic, especially considering that a number of these operators may be really quite rich, and £400 is unrealistically small. I need say no more. I beg to move.

Lord Belstead

My Lords, I understand very well the point that the noble Lord is making. The amendment would allow a £2,000 fine maximum instead of the £400 contained in the present provision. This compares with the penalties for offences which have a direct effect on the safety of the travelling public, such as operating without an operator's licence or operating without a public service vehicle driver's licence, where the maximum penalty is limited to £1,000.

I would be the more hesitant if it were not for the fact that I think, with respect, that the noble Lord may have overlooked another factor. It is the case that, in addition to the fine which we are discussing under this amendment arising out of a conviction under Clause 98, we are proposing to provide that such a conviction should be listed as a relevant offence in the public service vehicles operator's licence regulations, so that such an offence would be one of the factors to be taken into account when the operator's licence is considered for renewal by the traffic commissioners.

What I am saying is that it could be a relevant consideration in an operator finding that he does not get his licence renewed. I hope that in the light of that consideration, added to the words which I spoke about the comparability with other offences dealing with safety, the noble Lord may feel that perhaps there is not so much between him and the position which the Government have taken up. I am not entirely sure that the noble Lord will be wholly satisfied by what I have said, but at the same time I think that the aspect which I have put in about renewals is an important one and is relevant to this amendment.

Lord Henderson of Brompton

My Lords, I accept what the Minister says about the listing as a relevant offence when an operator wishes to apply for the renewal of his PSV licence. But I cannot accept that the systematic failure of an operator, by way of a deliberate attempt, or as a matter of deliberate policy, to defraud by not complying with a local authority scheme is equal to an operator operating without a public service vehicle licence. They seem to me to be quite different offences. One is much graver than the other.

Lord Belstead

My Lords, may I intervene for one moment? I think that I ought to say to the noble Lord that when he is talking about defrauding, this, with respect, is not the offence covered in Clause 98. Clause 98 covers failure to provide a concession when under compulsory participation. If this is fraudulent, it would be a matter for normal criminal sanctions.

Lord Henderson of Brompton

I see, my Lords. So what the noble Lord is saying is that it could be fraudulent and that if it were then it could be subject to the sanctions for fraud?

Lord Belstead

Yes, my Lords.

Lord Henderson of Brompton

My Lords, I thank the noble Lord for that; it reassures me considerably. But even so, even if it were not fraudulent, it still seems to me that a persistent offence of this sort is much worse, to put it only mildly, than an operator operating without a PSV licence. Nevertheless, I must not persist with this amendment because the other thing that the noble Lord said about it being listed as a relevant offence when a renewal is applied for is a material consideration. Having raised the point, I must beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Belstead moved Amendment No. 262A: Page 106, line 34, at end insert ("(and any such authority who would not apart from this subsection have power to bring such proceedings shall accordingly have that power).").

The noble Lord said: My Lords, this is a technical amendment. I beg to move.

On Question, amendment agreed to.

Clause 99 [Application of Passenger Transport Executive's financial plan to expenditure on travel concessions order schemes]:

Lord Brabazon of Tara moved Amendments Nos. 263 to 266: Page 107, line 10, at end insert ("and"). Page 107, line 18, leave out from ("above") to end of line 20. Page 107, line 28, at end insert ("and"). Page 107, line 30, leave out from (" "(d)" ") to end of line 34.

The noble Lord said: My Lords, with the leave of the House, I should like to move Amendments Nos. 263 to 266 en bloc. They are consquential upon the enactment of the Local Government Act 1985, and now that the Act has been passed and a date is fixed these provisions are redundant. I beg to move.

On Question, amendments agreed to.

Clause 100 [Subsidies for travel concessions]:

Lord Brabazon of Tara moved Amendments Nos. 267 and 268:

[Printed earlier.]

The noble Lord said: My Lords, I spoke to both No. 267 and No. 268 with Amendment No. 217. I beg to move.

On Question, amendments agreed to.

Following is the text of the amendments (Nos. 267 and 268): Page 107, line 37, leave out ("in respect of any service"). Page 107, line 40, leave out ("on journeys on that service").

Clause 101 [Travel concessions on services provided by Passenger Transport Executives]:

[Amendment No. 268A not moved.]

Lord Brabazon of Tara moved Amendment No. 269: Page 108, line 46, at end insert ("or (as the case may be) by authorities who include that Passenger Transport Authority.").

The noble Lord said: My Lords, I beg to move Amendment No. 269. This is a technical amendment which provides for the possibility that a scheme providing concessions on the Tyne and Wear Metro or PTE ferry services might be established jointly between a PTA and another authority. If this happened, the provisions of Clause 101(2) will now apply and such concessions under the scheme would not require the PTA's approval under Section 15(2) of the 1968 Act.

On Question, amendment agreed to.

Lord Belstead moved Amendment No. 270: After Clause 102, insert the following new clause:

.—(1) Any authority to whom this section applies, or any two or more such authorities acting jointly, may make, in such cases and subject to such terms and conditions as they think fit, grants to any other person towards expenditure incurred or to be incurred by that person in providing, maintaining or improving—
  1. (a) any vehicle, equipment or other facilities provided wholly or mainly for the purpose of facilitating travel by members of the public who are disabled; or
  2. (b) any equipment or other facilities specially designed or adapted for that purpose which are incorporated in any vehicle, equipment or other facilities not provided wholly or mainly for that purpose.
 (2) Subject to subsection (3) below, any such authority, or any two or more such authorities acting jointly, may make, in such cases and subject to such terms and conditions as they think fit, grants to any person providing public passenger transport services towards expenditure incurred or to be incurred by that person for the purpose of—
  1. (a) maintaining or improving facilities for public passenger transport, other than facilities provided wholly or mainly for use for the purpose of or in connection with excepted services; or
  2. (b) facilitating or improving the operation of public passenger transport services, other than excepted services;
 in the area of that authority or (as the case may be) in the area comprising the areas of both or all those authorities. In this subsection "excepted services" means services for the carriage of passengers by road which require a PSV operator's licence (within the meaning of Part IV of this Act). (3) Subsection (2) above shall not apply in relation to expenditure appearing to the authority or authorities in question to be of a capital nature. (4) This section applies to the following authorities—
  1. (a) any Passenger Transport Authority or Passenger Transport Executive;
  2. (b) the council of any county or district in England and Wales;
  3. (c) the council of a London borough or the Common Council of the City of London; or
  4. (d) any regional or islands council in Scotland.").

The noble Lord said: My Lords, this amendment gives a power to local authorities to grant-aid expenditure on vehicles and facilities which facilitate travel by disabled people. It applies both to facilities intended wholly or mainly for disabled people and to adaptations of normal vehicles and facilities. This provision covers the ground which is covered, I think, by Amendment No. 272 put down by the noble Baroness, Lady Stedman, and the noble Baroness, Lady Darcy (de Knayth) and I trust they will take that view and feel the Government amendment meets their amendment. I think I need say no more on this aspect of our amendment, other than that it is a valuable addition to local authorities' powers, and should be of value to all who are disabled. It was raised by noble Lords in the House at the previous stage.

The second half of our amendment ensures that local authorities can continue to contribute towards non-capital expenditure on maintaining public transport facilities other than those used in connection with bus services. That exception is necessary because it is our policy that financial assistance to the bus industry should take the form of service subsidies to which the tendering requirements apply, so that all bus operators can have a fair crack of the whip. The costs of maintaining bus facilities will be reflected in bus operators' tender prices, so we are not saying that that area of expenditure should be neglected. I beg to move.

On Question, amendment agreed to.

Lord Belstead moved Amendment No. 271: After Clause 102, insert the following new clause: Grants by London Regional Transport. ("Grants for services for disabled people in London. .—(1) London Regional Transport may make, in such cases and subject to such terms and conditions as they think fit, grants to any voluntary organisation for the purpose of meeting (in whole or in part) any expenditure incurred or to be incurred by that organisation for the purpose of the provision of transport services provided by that organisation solely to meet the needs of disabled members of the public resident in London. (2) In subsection (1) above "voluntary organisation" means a body the activities of which are carried on otherwise than for profit, but does not include any public or local authority.").

The noble Lord said: My Lords, this amendment, which I beg to move, gives effect to the Government's decision, announced on 9th October, that Dial-a-Ride transport services for disabled people in London should be funded through London Regional Transport.

The effect of the amendment will be to put LRT in a similar position to authorities outside London responsible for public transport. Your Lordships amended the Bill earlier, at Committee stage, to make it clear that, by altering the definition in Clause 61(10)(a) of "public passenger transport services", such authorities will be able to subsidise minibus services which meet the special needs of those who cannot use conventional public transport.

We shall be making a specific allocation of £5 million within the Government's overall grant to LRT to enable LRT to respond to requests for grant for Dial-a-Ride schemes. We are satisfied this will be sufficient to maintain provision at broadly the level anticipated by the end of March 1986, when GLC funding will cease. Part of this expenditure, up to a maximum of two-thirds, will be recoverable through the annual LRT ratepayer levy, in the same way that ratepayers contribute now towards LRT's costs.

I can also assure your Lordships that LRT fully support this decision and are now working out the necessary arrangements to take on this responsibility. I hope your Lordships will welcome this amendment. I believe it is a step in the right direction, and I beg to move.

8.30 p.m.

Lord Henderson of Brompton

My Lords, on behalf of the noble Baroness, Lady Darcy (de Knayth), who unfortunately cannot be here this evening, I should like to express her appreciation to the Minister both for this Amendment No. 271 and for the previous amendment.

Lord Belstead

My Lords, I am grateful to the noble Lord, Lord Henderson, if I may say so. He expressed an interest in these matters at an earlier stage and I am grateful to him for his generous remarks.

Viscount Ingleby

My Lords, I also am most grateful to the noble Lord, Lord Belstead, for these two amendments, which show that the Government recognise the need for grants for services for the disabled.

May I just ask him one question, merely to confirm that the Dial-a-Ride cost in London is approximately £5.3 million? I understand that two-thirds of that is to be recovered through a precept on the rates and one-third is to be met by a Government grant through LRT.

Lord Belstead

My Lords, I was just giving details when the noble Viscount, Lord Ingleby, came into the Chamber. It is indeed £5 million, which we believe is the necessary allocation and which we are going to make. Part of the expenditure up to a maximum of two-thirds will be recoverable through the annual LRT ratepayers' levy, in the same way as ratepayers now contribute towards LRT's costs. I can assure your Lordships once again that LRT fully support this particular approach.

On Question, amendment agreed to.

[Amendment No. 272 not moved.]

Clause 105 [Grants towards duty charge on bus fuel]:

Lord Teviot moved Amendment No. 273: Page 110, line 37, leave out paragraphs (a) and (b) and insert—

"a bus service which is of a description specified for the purposes of this section and which meets any conditions which may be specified in relation to that description of service.".").

The noble Lord said: My Lords, at present Clause 105 contains an amendment to Section 92(8) of the Finance Act 1965 which would restrict the fuel duty rebate to services which are wholly or mainly available to the general public. At present, services qualify for rebate provided that some seats are available for the general public. At Committee stage I raised the question of school services on which just a few seats might be available for the general public, which can be so valuable, particularly in rural areas.

These services will be denied rebate according to the Bill as it stands. I question the sense of that, given the Government's declared support for integrating schools and other services. The noble Baroness, Lady Darcy (de Knayth), and the noble Lord, Lord Henderson of Brompton, made a similar point about services for the elderly and the disabled. My noble friend indicated in reply the Government's willingness to look again at that, and I am grateful to him for help in drafting these amendments. Amendment No. 274 deletes the requirement that services should wholly or mainly be available to the general public. Amendment No. 274: Page 111, line 7, leave out ("wholly or mainly available to the general public and").

Amendments Nos. 273 and 364 concern the Secretary of State's powers to make regulations about eligibility for fuel duty rebate. Amendment No. 364: Schedule 7, page 169, line 33, at end insert—

("1965 c. 25. The Finance Act 1965. In section 92(1), the words "any bus service".").

Amendment No. 273 makes it clear that he may specify conditions which bus services have to meet if they are to qualify for rebate. The idea here is to rely on the regulation-making power to be used to impose more flexibility than is now the case under the Bill. A requirement of availability to the general public I accept as a valid one. It should be done in such a way as not to render ineligible school services and services for the elderly which just have a few spare seats for other passengers. I hope that my noble friend will feel able to indicate tonight the Government's intentions here. I beg to move.

Lord Belstead

My Lords, I should be glad, on behalf of the Government, to welcome these amendments. Even if others of your Lordships wish to take part in the debate I think it might perhaps be for the convenience of the House if I answer my noble friend, who asked about the intentions of the Government so far as concerns the regulation-making power in regard to these amendments.

It is my right honourable friend's intention that most services should, under the proposed regulations, qualify for rebate only if at least half the accommodation is available to the general public. This would mean, for example, that a contract service on which just one seat was theoretically available to the public would not qualify. Given that the aim of fuel duty rebate is to provide a subsidy for the kind of services on which the general public rely for day-to-day journeys, I hope your Lordships will agree that this is reasonable. It is ground which we went over during the Committee stage. But the Government have agreed that it would be wrong to apply this new condition across the board and that a less stringent requirement should apply to services for schools and for the elderly and disabled to encourage the best use of seats on these services.

As my noble friend Lord Teviot has said, this arose from discussion in which the noble Baroness, Lady Darcy (de Knayth), and the noble Lord, Lord Henderson of Brompton, both participated. The intention of the regulations of my right honourable friend is that these services for schools and for the elderly and disabled should be left in broadly the same position as they are now: qualifying for rebate, provided that a few seats are available to the general public.

Lord Henderson of Brompton

My Lords, I should like to intervene at this stage to thank the Minister once again on behalf of my noble friend Lady Darcy (de Knayth), and of course I should like to thank him personally myself. We are both extremely grateful to him and to the noble Lord, Lord Teviot, for moving these amendments and to the Minister for accepting them. I must say this is a most remarkable run: Amendments Nos. 270, 271, 273, 274 and 275. I can only hope that we can continue the luck with No. 275A.

Lord Teviot

My Lords, I would echo the feelings expressed by the noble Lord, Lord Henderson, as regards the statistics. It is almost too good to be true. I am very grateful to the Government for having allowed us to reach this very satisfactory conclusion.

On Question, amendment agreed to.

Lord Teviot moved Amendment No. 274:

[Printed above.]

On Question, amendment agreed to.

[Amendment No. 275 not moved.]

Viscount Ingleby moved Amendment No. 275A: After Clause 105, insert the following new clause: ("Grants by the Secretary of State for services for elderly and disabled persons. ( ) Subject to the following provisions of this section the Secretary of State may, with the approval of the Treasury, make in such cases as he thinks fit grants to any authorities responsible for expenditure on public passenger transport services to promote the availability of passenger transport services by persons who are elderly or disabled. (2) An authority responsible for expenditure on public passenger transport services shall apply such grants to

  1. (a) secure or continue the operation of services, whether operating to a timetable or not, for passengers who require to use wheelchairs; or
  2. (b) provide or continue to provide facilities which could not be provided on a commercial basis to facilitate the use of bus services by persons who are elderly or disabled and whose mobility is impaired but who are not dependent on the use of wheelchairs.
(3) Grants under this section shall be of such amount and subject to such conditions (including conditions requiring their repayment in specified circumstances) as the Secretary of State may, with the approval of the Treasury, determine either generally or in relation to any particular case or classes of case.").

The noble Viscount said: My Lords, the purpose of this amendment is to give the Secretary of State powers to assist special services for disabled people where they are at risk. The services I have in mind are mainly Dial-a-Ride, which exists in many areas other than London. Indeed most of our big cities are included and also country areas such as Derbyshire and Gloucestershire. Also included are the special scheduled bus services for wheelchair users such as exist in Leicester, South Yorkshire and Strathclyde.

May I give one example of each, from my personal experience, recently? While on holiday in France my wheelchair tipped over on some rather rough ground. I was thrown out on to my right side, and dislocated my right shoulder. Without the use of my right arm, I would have been completely immobilised but for GHIP. In case your Lordships are wondering what GHIP is, it is the French equivalent of Dial-a-Ride. GHIP came to my rescue in a little Peugeot van fitted out to carry two wheelchairs and a number of able-bodied people, with extendable ramps and a charming French driver by the name of Eric, who picked me up at the door, took me wherever I wanted to go in Aix-en-Provence and enabled me to get to the bank, to do my shopping and to visit friends. Without GHIP, I would have been completely housebound for the rest of my holiday.

The other visit I have made recently was in company with the noble Baroness, Lady Darcy (de Knayth). We visited Doncaster to see the special buses. These are Leyland Nationals which have had the seats removed, so that seven wheelchairs can be taken, and a number of able-bodied people. These buses travel around a different part of the outskirts of Doncaster every day, pick up wheelchair users at their own doors, take them to the centre of Doncaster, to the Arndale Shopping Centre, where they have two hours or so to do their shopping and meet their friends, and they are then picked up again and dropped at their own doors. I can honestly say that the lives of these people have been transformed by this weekly special bus service. If you are housebound, the idea of being picked up regularly once a week by drivers whom you know and trust, taken into the mainstream of life and then brought home again really makes the difference between existing and living.

But these services are expensive and cost about four times as much to run as an ordinary bus service. The Government have recognised the need for grants for these services in the powers that they are proposing to give to local authorites under Amendments Nos. 270 and 271. But local authorities are all being squeezed, and they have many other demands on their available resources. Some of them are being rate-capped, with specific limits set on what they can spend on transport, so that they may have to choose between, say, one service for disabled people and four services for the able-bodied; and at the present time the future of these services in uncertain.

I am quite sure that the Secretary of State, and indeed the Government, would not want any of these lifelines to lapse for lack of money—indeed, I am sure that the Government would like to see more of them—but their funding must be secure. I am delighted that the Government have done exactly this for London, and I hope that they will do the same for the other parts of the country as well. This amendment would give power to the Secretary of State to do for other parts of the country what he has so well done for London. My Lords, I beg to move.

8.45 p.m.

Earl Attlee

My Lords, it gives me great pleasure to support the noble Viscount, Lord Ingleby. It is interesting to me that, whereas the noble Viscount is a user, I, in a very small way, am a driver—admittedly, in London where, as we already know, the Government have seen fit to help us—and I have never driven an ambulance or Dial-a-Ride outside London.

The point is that the finances for providing transport for those who require it come from various sources. According to the figures that I have been given—I shall give only one example, because if you have one example your Lordships can change the figures around all over the country—there are at least 400 community transport schemes. In Reading, for instance, the Reading bus service runs five adapted vehicles which carry 20,000 passengers a year. They receive £52,000 in urban aid and £117,000 from the county and district councils. Urban aid is coming to an end—this is its last year—and without specific grant availability there is doubt, as the noble Viscount has already mentioned, as to whether these services can be continued. I think that the Government will say "Ah! Yes" and will refer to the £1 million innovation grant which I think is supplied by the development commission. But this is a very limited sum which is general in purpose and will in no way cover the country. Without this amendment a great many people will be immobile and stuck at home.

Without talking about hearts or anything else, it is a fact that if people who are immobile stay at home and do not get out they become a greater drain on financial resources, because they become ill. It has been proved time and again that if these people are made mobile and can get out they do not get these trivial illnesses. I believe that in one of the Scandinavian countries where they operate such a service they have shown conclusively—if statistics can ever be proved—that by providing Dial-a-Ride type services the Government save money. I shall not say more than that. I think that the noble Viscount has said everything that needs to be said and I support this amendment.

Lord Teviot

My Lords, I should just like to make a comment or two to support the amendment of the noble Viscount and the noble Earl. One hesitates to enter into the disabled lobby, which has made such valuable comments and such a good contribution to this Bill, but I should like to mention that I also paid a visit to South Yorkshire and Doncaster and I should like to add to various points that have been made. What impressed me about the service there was that there was a perfectly ordinary bus in normal livery with an ordinary number and, although the people who rode in it were in wheelchairs, there was no patronage and no condescension. Either they were with their helpers or they found their own way. The two-man crew were extremely efficient. The passengers just arrived and went up in a very robust lift, that would have taken a motorised wheelchair, straight into the bus.

I did not talk to the people very much, but they looked independent and perfectly ordinary with nothing special about them. They looked as stoic as one can be in a wheelchair. They were taken straight into the city centre to a well-known chain store whose name I forget. They were then unloaded and they could go off and do their shopping, have lunch and an hour-and-a-half or so later they went home. Your Lordships may say about many other things "Big deal", but I was very impressed by that service.

Baroness Elliot of Harwood

My Lords, may I also add one word in support, because I have had a great deal to do with handicapped people in the last five or six years. I know that it would make a tremendous difference if a clause like this went into the Bill, and if the bus organisations realised that, with very little trouble, they could do something which would make an enormous difference to a great many people who otherwise would not be able to get about. I hope that the Government will accept this proposal and that we shall really do something in this Bill for the handicapped.

Lord Belstead

My Lords, this amendment would have the effect of enabling my right honourable friend to make grants available to authorities. In regard to the powers of authorities, I would remind your Lordships that it is the intention that they should have powers under the Bill to make finance available for all the purposes to which the noble Viscount, Lord Ingleby, refers in the amendment. The general powers of authorities to provide support for public passenger transport services through the tendering process include a power to specify in going out to tender that those services should include facilities designed to meet the needs of disabled people, and these facilities could of course include features specially adapted for wheelchairs.

We have just now been discussing the new clause, Amendment No. 270, which the noble Viscount kindly mentioned, which gives authorities additional powers to make grants to operators for expenditure incurred in providing vehicles or other equipment intended wholly or mainly to improve travel facilities for people who are disabled, together with a corresponding power in respect of adaptations for that purpose to vehicles providing services for members of the public generally. We have also amended Clause 61 so as to allow authorities to provide support for minibus services when these services are provided for members of the public who are elderly or disabled.

Perhaps I may just say that in exercising these powers authorities will of course be required to bear in mind the new and specific duties which the Bill lays on them to have regard to the travel needs of elderly and disabled people. They will also be able to draw on guidance which is going to be issued by my right honourable friend on the advice of the new statutory advisory committee which I hope your Lordships will agree to set up a little later this evening. Those will be additional encouragements to what is going on at the present time.

I was very interested that all noble Lords who have spoken mentioned provision which is being made. The noble Viscount mentioned his experience in France and what he and the noble Baroness Lady Darcy (de Knayth) had seen going on in the north of England. The noble Earl, Lord Attlee, spoke from his personal experience as a driver of Dial-a-Ride services. My noble friend Lord Teviot spoke of a visit he had paid to Yorkshire, and my noble friend Lady Elliot has been closely involved with this whole scene, particularly in recent years. I would simply say that it is not therefore doom and gloom. An enormous amount is going on at the moment and is being done through the aegis of voluntary organisations. When the noble Viscount said to me, "Can't we add to the concept of direct grants Dial-a-Ride?", which is embodied in Amendment No. 271, I would say that those grants will be paid through the agency of London Regional Transport and to voluntary organisations which are providing Dial-a-Ride in London.

What the new clause proposes and what the amendment would do is to provide for the exercise of these grant powers, in so far as they related to services for disabled people, to be eligible for support from central Government by way of direct grants. There really is a difficulty here in regard to local government finance. As your Lordships know, the basis of that system is that local authorities should make their own choice of priorities within the overall resources available to them. A system of specific grants of the kind which the noble Viscount is proposing would inevitably introduce an element of distortion into the process of decision-making.

I am sorry, and I hope I am not being too unforthcoming in saying that the noble Viscount is presenting an amendment which, with the best will in the world, the Government feel they cannot accept. But I would remind your Lordships of the enormous amount that we are already doing in the Bill to see that authorities who are the subject of this amendment will have an easier passage, a more practical passage, in giving help to disabled people in these ways. I would also recognise what is already going on at the present time.

Viscount Ingleby

My Lords, I should like to thank the Minister for his reply and for what he has already done, which I think is of considerable benefit to disabled people, but I still feel that the special services are at risk. Their funding is not secure for the future. I very much hope that the Government who have acted so splendidly over Dial-a-Ride in London will be able to give similar help and similar thought, consideration and money to these other services in other parts of the country. Having said that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 106 [Unregistered and unreliable local services: reduction of fuel duty grant]:

The Deputy Speaker

My Lords, I have to say that if Amendment No. 276 is agreed to I cannot call Amendment No. 277.

Lord Brabazon of Tara moved Amendment No. 276: Page 111, line 25, leave out paragraphs (a) and (b) and insert ("that the operator of a local service has, without reasonable excuse—

  1. (a) failed to operate a local service registered under section 6 of this Act; or
  2. (b)to a significant extent operated a local service in contravention of that section;").

The noble Lord said: My Lords, with the leave of the House, I shall speak to Amendments Nos. 278 and 279 at the same time. Amendment No. 278: Page 111, line 34, leave out subsection (3). Amendment No. 279: Page 111, line 42, leave out ("the") and insert ("any").

These amendments which are technical are designed to improve Clause 106 so that it operates more fairly and to bring it into line with Clause 26. I beg to move.

On Question, amendment agreed to.

[Amendment No. 277 not moved.]

Lord Brabazon of Tara moved Amendment No. 278:

[Printed above.]

The noble Lord said: My Lords, I spoke to Amendment No. 278 with Amendment No. 276. I beg to move.

On Question, amendment agreed to.

Lord Teviot moved Amendment No. 278A: Page 111, line 41, after ("service") insert—

The noble Lord said: My Lords, I think it will be for the benefit of your Lordships if, in addition to this amendment, I speak to Amendments Nos. 278B, 280A and 280B. Amendment No. 278B: Page 111, line 42, leave out ("twenty per cent. of"). Amendment No. 280A: Page 111, line 44, leave out from ("of") to ("the") in line 1 of page 112 and insert ("that service for"). Amendment No. 280B: Page 112, line 3, at end add—

My noble friend Lord Brabazon has introduced purely technical amendments to this clause to which the noble Lord, Lord Shepherd, also has other amendments, but he is not here to move them. However, while I have agreed with the noble Lord that I am going to move mine, I am persuaded that it would be unreasonable to place the traffic commissioners in the position of magistrates, imposing fines to a maximum figure. I remind your Lordships that a large operator might under the system proposed by the Government incur a penalty more than 60 times greater than that of a small operator who is guilty of an identical fault, although I recognise that a large operator is likely to have a condition attached to his own licence prohibiting him from providing local bus services because this would be depriving the public of many necessary services. The alternatives are altogether too severe.

In Amendment No. 280B I have tried to capture the best of both ideas to provide on a predetermined scale a heavier penalty for the larger operator without the excess of the Bill. I hope that this solution will find favour with your Lordships. I have not gone into any great detail on the arguments I produced in Committee when I divided the House. I think it is much better that I stop where I am, listen to what my noble friend or other noble Lords might have to say on this particular, rather important matter which needs to be settled. In that context I beg to move.

The Earl of Caithness

My Lords, may I commend my noble friend on his brevity. I am afraid that I have to tell your Lordships that I shall not be as brief because, as my noble friend said, it is important that we cover this ground fully. I have listened very carefully to what my noble friend has just said and have reread what was said in Committee. We shall be covering a lot of it for a second time, but on this occasion, in view of the interest of the noble Lord, Lord Shepherd, who, alas! is not here, I think I should deal with it in a proper manner.

I think the two questions to which we must address ourselves in considering penalties under Clause 106 are, whether they are fair and whether they are likely to deter the sort of irresponsible behaviour which I am sure we would all deprecate. Let us not forget that what we are discussing is not a fine but a reduction in grant, taxpayers' money, which is paid by central Government to encourage the operator of local bus services to meet people's needs.

9 p.m.

I shall deal first with the question of fairness. My noble friend pointed out that very large sums of money could become due to the Secretary of State from a large operator who did not run one or more registered services or did not run them in accordance with the registered particulars. The potential penalties are large and we make absolutely no apology for that. They reflect the very substantial responsibilities towards the travelling public which have been taken on by operators of local services. The larger the operator the greater the responsibility. It is only right that substantial sums should be at risk if an operator abuses that responsibility.

The Government have sought in Clause 106 to embody that principle by basing the penalty which an operator would incur not on the particular service which he had operated badly but on all his services. My noble friend's amendments, however, would base the penalty on the service or services which had been operated badly. They then appear to acknowledge that this would let the large operator off too lightly and go on to impose progressively heavier penalties on those operators with more than 50 vehicles. There are two points I want to make about this approach.

The first is that it would surely be unequitable to use as a criterion the number of vehicles specified on the operator's licence. The operator may, for example, have 100 vehicles but use 90 of them on excursion or tour work. He would be receiving fuel duty rebate only in respect of local services operated with the remaining 10 vehicles in his fleet. Yet he would be penalised as though he was using all 100 of his vehicles on local services which attracted fuel duty rebate.

The other point I make on the formulation proposed in these amendments is that it would dramatically reduce the penalties imposed on the larger operators. The bigger the operator the more he would benefit from these amendments, which is absolutely contrary to our proposals. Indeed, the very largest operators would benefit still further from the provision in Amendment 280B, which would limit the penalty to five times the amount which would be imposed on an operator with 50 vehicles.

The second aspect of my noble friend's amendments which concerns me is in relation to this deterrent effect, already mentioned by my noble friend. Clause 106 is there principally to deter operators from letting the public down by running services irresponsibly or unreliably or, indeed, by not running them at all, and by doing so without a reasonable excuse. Nobody would be more pleased than my right honourable friend if Clause 106 is never used. But inevitably that is more likely to be the case if the potential penalties are substantial.

We must also remember that the traffic commissioners might be more reluctant to use the Clause 26 penalty concerning conditions attached to a PSV operator's licence against a larger operator. This was acknowledged by my noble friend.

Such operators may feel, whether rightly or wrongly, that the commissioners would be unlikely to attach conditions to their licences to prevent them from running services on which many people rely. The prospect of a heavy penalty under Clause 106 will provide a balance to that. The Government's intention is that Clauses 26 and 106 should fit together to provide an even deterrent to small and large operators alike.

I have tried to demonstrate that, compared with the noble Lord's amendments, Clause 106 as drafted is likely to produce results which are both more equitable and more likely to prevent the sort of misbehaviour we would all deplore. I hope therefore that my noble friend will see fit to withdraw his amendment.

Lord Teviot

My Lords, my noble friend has given a very full explanation. I share with my right honourable friend the hope that Clause 106 will never be used, and that is a wish we have very much in common.

I shall have to read very carefully what my noble friend has said. As to the question of large operators, he may have a very good point but at the moment I cannot say absolutely that he does. I should not wish my noble friend to get me wrong, but there is sometimes the view that small is beautiful and large is bad. That probably does not apply to this amendment. However, I believe it is necessary to reconsider this matter very fully. I may not have to return to this point on Third Reading, but if I feel that I have to do so, then I shall. In the present circumstances, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Deputy Speaker (Lord Airedale)

My Lords, in chronological order the next amendment is Amendment No. 280, but do I understand that Amendment No. 280 is not moved?

Lord Brabazon of Tara

My Lords, with the leave of the House, I believe that the next amendment to be taken is Amendment No. 279.

[Amendment No. 278B not moved.]

Lord Brabazon of Tara moved Amendment No. 279:

[Printed earlier.]

The noble Lord said: My Lords, I referred to this amendment when moving Amendment No. 276. I beg to move.

On Question, amendment agreed to,

Following is the text of the amendment (No. 279): Page 111, line 42, leave out ("the") and insert ("any").

[Amendments Nos. 280, 280A, 280B and 281 not moved.]

Clause 107 [Interpretation of Part V and supplementary provisions]:

The Earl of Caithness moved Amendment No. 282:

[Printed earlier.]

The noble Earl said: My Lords, I spoke to this amendment with Amendment No. 241. I beg to move.

On Question, amendment agreed to.

Following is the text of the amendment (No. 282): Page 112, line 17, at end insert—

The Earl of Caithness moved Amendment No. 282A: Page 112, leave out lines 32 to 41.

The noble Earl said: My Lords, in moving Amendment No. 282A I should like to speak also to Amendments Nos. 291A and 295A. Amendment No. 291A: Clause 117, page 123, line 10, leave out subsection (10). Amendment No. 295A: After Clause 125, insert the following new clause:

.—(1) In Part II of the 1968 Act, the references to that Part of that Act or (as the case may be) to that Act mentioned in subsection (2) below shall include references to this Act. (2) Those referencs are—
  1. (a) the references to that Part of that Act in section 12(2), (3)(d) and (g) (borrowing powers of Executive) and in section 15(5) (expenditure by Authority in performing their functions to be defrayed by Executive); and
  2. (b) the references to that Act in section 12(5)(b) (which refers to rights of priority in respect of any liability assumed by or transferred to an Executive in pursuance of that Act).").

These amendments will allow the financial provisions of the 1968 Act to apply in relation to all the functions of the PTEs and PTAs under this Bill. I beg to move.

On Question, amendment agreed to.

[Amendments Nos. 283 and 284 not moved.]

Clause 110 [Application of Restrictive Trade Practices Act 1976 to agreements between road passenger transport operators].

Lord Belstead moved Amendment No. 285: Page 114, line 8, at beginning insert ("In").

The noble Lord said: I beg to move Amendment No. 285, and at the same time speak to Amendments Nos. 286, 306, 385 and 386. Amendment No. 286: Page 114, leave out line 13 and insert—

Amendment No. 306: Clause 131, page 134, line 11, leave out ("4") and insert ("4(2)"). Amendment No. 385: Clause 132, page 134, line 28, leave out ("except section 109(1)(a) and (2)") and insert (", with the exceptions mentioned in subsection (6) below,"). Amendment No. 386: Page 134, line 29, at end insert— ("(6) Those exceptions are—

These are technical amendments. I beg to move.

On Question, amendment agreed to.

Lord Belstead moved Amendment No. 286:

[Printed above.]

On Question, amendment agreed to.

The Earl of Caithness moved Amendment No. 287: After Clause 110, insert the following new clause:

.—(1) In subsection (3) of section 137 of the Fair Trading Act 1973 (which defines "the supply of services" for the purposes of that Act and, by virtue of section 33(2) of the Competition Act 1980, for the purposes also of sections 2 to 24 of the latter Act) there shall be inserted after paragraph (c)— and (2) In section 20 of the Restrictive Trade Practices Act 1976 (interpretation of the Part of the Act dealing with services) there shall be inserted after paragraph (b) in the definition of "services"— and (3) The Act of 1976 shall have effect in relation to any agreement (within the meaning of that Act) which—
  1. (a) was made before the date on which this section comes into force; and
  2. (b) becomes subject to registration under that Act on that date by virtue of the effect which an order under section 11 of that Act has as a result of the coming into force of this section;
 as if it had become subject to registration by virtue of an order under section 11 made on that date.").

The noble Earl said: My Lords, I beg to move Amendment No. 287. The purpose of this amendment is to bring the provision of access to bus stations within the relevant provisions of competition law. It is a technical amendment. Perhaps if I can summarise in layman's language, the aim is to clarify the situation to that which we have always wanted which, simply, is that there should be access to bus stations, whether local authority or private. The local authority bus stations we have already covered earlier in the Bill. These amendments are aimed at the non-local authority sector. I beg to move.

On Question, amendment agreed to.

[Amendment No. 288 not moved.]

Lord Tordoff moved Amendment No. 289: After Clause 111, insert the following new clause:

.—(1) In Section 56(5) of the 1962 Act (matters which Transport Consultative Committees may not consider) at the beginning there shall be inserted the words "Without prejudice to their power to consider the general structure of fares and the relativities of fares within that structure," and the words "or reduction" shall cease to have effect. (2) In section 40(6) of the London Regional Transport Act 1984 (matters which London Regional Passengers' Committee may not consider) after the word "Act" there shall be inserted the words "or their power to consider the general structure of fares and the relativities of fares within that structure," and in paragraph (b), the words "or reduction" shall cease to have effect.").

The noble Lord said: My Lords, it will be remembered that during the Committee stage I moved an amendment which would have had the effect of completely removing restrictions on the central transport consultative committees, the transport users consultative committees and the regional passengers committees viz. their powers to consider fares and charges and propose reductions in British Rail services. I quoted extensively at that time from commitments given by the right honourable lady the Minister of State for the Department of Transport in the official record of the 13th December 1983. I do not propose to requote all that. However, the important aspect is that the right honourable lady gave certain guarantees at that stage, first of all saying that they accepted the general point being made, that my honourable friend the Member for Bermondsey, who had raised the matter with her, was pushing against an open door and that in due course when the appropriate moment came legislation would be introduced. That was in 1983.

I recognise that the amendment I moved in Committee went further than the commitment that the right honourable lady had given. But I still believe that we ought to try to get the matters tidied up in this Bill in so far as we can.

In the Committee stage, the noble Earl. Lord Caithness, said that both British Rail and London Regional Transport had agreed to consult with the TUCCs informally before implementing fares increases, "so this already takes place at the moment", the noble Earl said. Sadly, this is not so, because in that very month of July this year British Rail increased all longer distance Inter-City saver fares and the first that any of the committees knew about it was through press reports. British Rail made it abundantly clear that at that time they did not feel that the informal consultation process should or did cover anything other than the annual fare increases, despite the fact that for many journeys the saver tickets are now in practice the standard return fare. The noble Earl finished his speech with the words, "I hope your Lordships will agree we should await a more appropriate legislative opportunity," but that was on the basis that things were working as he suggested. It is unclear when such an opportunity will arise. We are given to understand that the proposed Treasury-sponsored nationalised industry business will not come before the 1985–86 Session; doubtless we shall have to wait for a fortnight before we can guarantee that. I am sure that Ministers will not tell us tonight what is not in the Queen's Speech any more than they will tell us what is in the Queen's Speech, and it may be some time before another suitable Bill comes before Parliament. It seems we have an opportunity to enshrine this in legislation at present without damaging the Bill as it stands at present. I beg to move.

The Earl of Caithness

My Lords, may I begin by saying that I am very happy to reassure the House that it remains our firm intention to fulfil the commitment to which the noble Lord, Lord Tordoff, has referred; but I believe there are good reasons why it would not be appropriate to do so by means of this new clause. First, I explained to the Committee on 29th July the reasoning behind the nature of the commitment of the Government. Like the noble Lord, Lord Tordoff, I do not want to go over that ground again.

I have to tell the noble Lord that the new clause does not, in fact, achieve the extension of the consumer bodies' powers which I think he intended. The noble Lord proposes to amend Section 56(5) of the Transport Act 1962 and Section 46 of the London Regional Transport Act in such a way that the consumer bodies' exclusion from considering charges made for any service or facility set out in those subsections should be without prejudice to their power to consider the general structure of fares and the relativities of fares within that structure. But there is no indication given of where these apparently free-standing powers are to be found. Indeed, our view is that no such powers exist and that amending legislation is required precisely to give the consumer bodies powers in this matter. Therefore, the amendments proposed, if I may humbly submit this to the noble Lord, are not logical.

9.15 p.m.

I have already referred to the fact that in practice the various consumer bodies do not consider both BR and LRT service reductions and they now have an opportunity to make a contribution in the matter of structure and relativity of fares. I can well understand the concern to regularise these informal arrangements to give them a statutory basis but I must say that, given the Government's commitment to legislate in this area and the firmly established arrangements which exist for considering BR service reductions and, furthermore, given the undertaking from both BR and LRT chairmen that in advance of the statutory provision they will consult the consumer bodies about their fare structures, I do not believe that the inclusion of the statutory revision is likely to make very much difference.

The noble Lord, Lord Tordoff, asked when we will legislate. He knew the reply better than I did. I cannot tell him what will be in the Queen's Speech. I hope that he will be patient and wait.

As I said before, the Bill is primarily about bus services and there is a limit to the number of policy areas, however worthy, which we can raise at what is becoming an increasingly late stage of the Bill; although I have to admit that the noble Lord did raise this matter in Committee. With the explanation that it would be right to wait for a more opportune legislative programme where, if necessary, changes can be made, I hope the noble Lord will withdraw the amendment.

Lord Tordoff

My Lords, I do not think there is any need to prolong the agony. If this is the result of pushing against an open door, I would not wish to push against a closed door or I should receive a very sore nose. Nevertheless, we have made the point.

One of the reasons I wanted to raise this matter tonight was to correct the record from what I said in Committee, when I clearly went beyond the commitment the Minister had given. I wanted to assure the House that I was aware of that. It is a pity that the Government are not prepared to move on this matter. I can understand that they do not want this Bill cluttered up with extraneous matter but I very much hope that they will find an early opportunity to put the matter right, because although there are assurances that British Rail say they will co-operate it does not happen every time. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 4 [Constitution, powers and proceedings of the Transport Tribunal]:

Lord Tordoff moved amendment No. 289A: Page 150, line 34, leave out ("may") and insert ("shall").

The noble Lord said: My Lords, I have to inform the House that my noble friend Lord Airedale is otherwise engaged and is unable to move this amendment standing in his name; which he would have done far more eloquently than I possibly can.

This amendment takes us back to 29th July when the Bill was being debated and the noble Viscount, Lord Colville of Culross, raised an interesting matter and said: May I ask my noble friend, without expecting him to reply today, to refer to paragraph 9(2) which reads: 'The tribunal may not on any such appeal take into consideration'."—[Official Report, 29/7/85; col. 58.]

and so on. He pointed out that this probably meant that the tribunal "shall" not on any such appeal take into consideration. It seems to me, and certainly to my noble friend Lord Airedale, that that is the intention of the Government in this clause.

The noble Lord, Lord Brabazon of Tara, said that he would take this away and look at it carefully, while yielding to no one on his lack of knowledge on the difference between "may" and "shall" in legal terms, and that he would definitely come back to this later. I am grateful to my noble friend for tabling this amendment and I hope that the Government will accept it. I beg to move.

Lord Brabazon of Tara

My Lords, I did indeed undertake to look into this matter when my noble friend Lord Colville of Culross raised the matter in Committee and I have done so. I can assure noble Lords that there is no room for doubt as to the meaning of the provision as drafted.

There is indeed room for argument in some cases as to whether what is ostensibly a discretion in fact involves a duty, and then lawyers certainly argue about the difference between "may" and "shall". However, I am glad to say that my lack of knowledge during the Committee stage has, I hope, been partially remedied. Where "may" is used in conjunction with an unconditional negative it is clear that there is simply no discretion. It seems to us, therefore, that there is no room for doubt as to the meaning of this provision and that the amendment is not necessary. I ask your Lordships to read the relevant part of the Bill and to transpose the words "may" and "shall". I think your Lordships will agree that in fact it has the same meaning one way and the other. Therefore, I would suggest that the amendment is not necessary.

Lord Tordoff

My Lords, I am sure that if the noble Lord, Lord Airedale, were here to respond to that explanation he would give a much better reply than I can, but it seems to me to be nonsense that "may" is the same as "shall", even in a context such as this. Nevertheless, we doubtless have to bow to the parliamentary draftsmen and legal eagles who cannot speak English but have to use a different sort of language where meaning has no meaning. In those circumstances, I really have no alternative but to beg leave to withdraw the amendment, but perhaps the noble Lord, Lord Airedale, may wish to come back to it at a later stage.

Lord Brabazon of Tara

My Lords, it is its use in conjunction with the unconditional negative that makes all the difference.

Lord Tordoff

My Lords, I heard the noble Lord the first time—and that repetition does not help.

Amendment, by leave, withdrawn.

Clause 112 [Railways Board's road passenger transport services]:

Viscount Ingleby moved Amendment No. 290: Page 114, line 43, at end insert— ("( ) In exercising the powers prescribed in subsection (1) of this section it shall be the duty of the Railways Board to have due regard to the needs of elderly or disabled passengers.").

The noble Viscount said: My Lords, this amendment which stands in the names of myself and the noble Baroness, Lady Darcy (de Knayth), provides that where there are temporary or permament railway closures, and where of course substitutions of bus services are being brought into being, "it shall be the duty of the Railways Board to have due regard to the needs of elderly or disabled passengers".

I am delighted to be able to tell your Lordships that this wording comes from the British Railways Board itself in a letter to me dated October 4th from Mr. Grant Woodruff, the Director of Public Affairs there, in which he refers to a letter from the board to the Department of Transport in March this year, when this undertaking was put forward. I warmly welcome this undertaking. I should like to pay a tribute to the many initiatives which the Railways Board is undertaking at the present time on behalf of disabled people. I beg to move.

Lord Belstead

My Lords, the noble Viscount is persuasive on this. Indeed, he was good enough to warn me that he had secured the agreement of British Rail; but I put it to the noble Viscount that I really do not think it makes very much sense to impose a duty on the British Railways Board in relation to a small part of their operations when no such duty applies in relation to the rail network or other bus operators. British Rail are aware of concern expressed on this issue during the passage of the Bill by the noble Viscount and the noble Baroness, and British Rail's view, which they have made known to the noble Viscount, is that a general duty to have regard to the needs of elderly and disabled passengers would be acceptable. This, of course, would be a duty of a kind which is infinitely preferable to them to the imposing of absolute standards of the kind proposed in the earlier amendment which was tabled on this matter.

I just say, with respect to British Rail, that they are not necessarily in the best position to judge how their statutory duties ought to be framed and whether any extension of those statutory duties which applied only in respect of a very small part of the passenger network would distort the overall framework. The fact of the matter is that when a bus substitution service is set up for either the permanent or the temporary withdrawal of a rail service, all the measures in this Bill to ensure that the needs of elderly and disabled passengers are catered for will apply to those services.

All the measures that we have been talking about this evening and before on the Bill—better training for bus drivers, the new construction and use regulations, the code of practice, the statutory advisory body and many other things—will apply to the bus substitution services running in place of rail services in just the same way as they apply to other bus services. But I would emphasise that the final decision on whether a bus substitution service should be provided following withdrawal of a rail service is not for British Rail; it is for my right honourable friend. It will not be possible under this legislation for British Rail simply to opt to provide a bus service in place of a rail service. The advantage of that is that for his part my right honourable friend will have power to impose conditions relating to the operation of the services. I give an undertaking to the noble Viscount that, if appropriate, those conditions could require special facilities to be provided so that the service was acccessible for wheelchair users.

The noble Viscount is generous in his words about what British Rail has been doing on a voluntary basis to improve the accessibility of the passenger network to disabled people, and indeed elderly people often benefit from the facilities provided. The assurance British Rail has offered in relation to the duty imposed by the amendment is further proof of its good will. But it is not an argument in favour of imposing a duty which would apply not to British Rail's rail network but only to any bus services whose provision British Rail secured in place of rail services. I think that it is an argument in favour of continuing to place faith in the board's ability and willingness to look to the needs of elderly and disabled people on a voluntary basis.

I hope that the noble Viscount will not mind my putting those points in answer to his amendment. He was persuasive, but I feel that this evening on this point I am not yet persuaded.

Viscount Ingleby

My Lords, I listened carefully to the noble Lord and I shall read carefully what he said. I must admit that I find it rather extraordinary that when British Rail is quite happy to accept the duty the Minister should raise doubts on it. I do not want to delay the House further at this point in time, but I must reserve the right, if necessary, to come back to the matter at Third Reading. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Earl of Caithness moved Amendment No. 291: Page 116, line 19, leave out from beginning to ("the") in line 21 and insert—

The noble Earl said: My Lords, this is a drafting amendment. I beg to move.

On Question, amendment agreed to.

Clause 117 [Supplementary and consequential provisions]:

The Earl of Caithness moved Amendment No. 291A:

[Printed earlier: col. 784.]

The noble Earl said: My Lords, I spoke to this with Amendment No. 282A. I beg to move.

On Question, amendment agreed to.

Following is the text of the amendment (No. 291A): Page 123, line 10, leave out subsection (10).

Baroness Lane-Fox moved Amendment No. 292: After Clause 118, insert the following new clause:

.—(1) There shall be established in accordance with this section a body to be known as the Disabled Persons Transport Advisory Committee. (2) The Committee shall consist of—
  1. (a) a chairman appointed by the Secretary of State; and
  2. (b) not less than ten, nor more than twenty, other members appointed by the Secretary of State after consultation with such bodies as appear to him to be representative of the interests of persons likely to be significantly concerned with matters within the competence of the Committee.
 (3) The Secretary of State shall, so far as is reasonably practicable, secure that at all times at least half of the membership of the Committee consists of persons who are disabled. (4) The Secretary of State may appoint one or more members of the Committee to be deputy chairman or (as the case may be) deputy chairmen of the Committee. (5) It shall be the duty of the Committee to consider any matter, relating to the needs of disabled persons in connection with public passenger transport, which is referred to them by the Secretary of State or which they think it appropriate to consider without such a reference and to give such advice to the Secretary of State on any matter which they have considered as they think appropriate. (6) The Committee shall make an annual report to the Secretary of State, who shall lay a copy of it before each House of Parliament. (7) Schedule (the Disabled Persons Transport Advisory Committee) to this Act shall have effect with respect to the Committee.").

The noble Baroness said: My Lords, with the leave of the House, I shall speak also to Amendments Nos. 307 and 388, which are purely technical. Amendment No. 307: Before Schedule 5, insert the following new Schedule—

    cc791-803
  1. SCHEDULE 6,062 words
    2. cc803-16
  2. SCHEDULE 6,775 words
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