HL Deb 22 October 1985 vol 467 cc1008-26

4.50 p.m.

The Lord Advocate (Lord Cameron of Lochbroom)

My Lords, I have it in command from Her Majesty the Queen to acquaint the House' that she, having been informed of the purport of the Law Reform (Miscellaneous Provisions) (Scotland) Bill, has consented to place her interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.

My Lords, I beg to move that this Bill be now read a third time.

Moved, That the Bill be now read a third time.—(Lord Cameron of Lochbroom.)

On Question, Bill read a third time.

Lord Ross of Marnock moved the amendment:

page 41, line 34, leave out Clause 55.

The noble Lord said: My Lords, this amendment is one which gives us an opportunity to look at Clause 55. It was introduced more or less as an amendment at Report stage. I tend to look more than once at amendments that are introduced belatedly like that on a subject which has not been discussed in the Commons at all. When it was amended here at Committee stage there was a very considerable change because at that time the noble and learned Lord the Lord Advocate said that what we were doing was merely bringing Scottish law into line with English law.

We could hardly say that now, because I think that what was in the mind of the Lord Advocate at that time—and we must remember that the Committee stage was before the Recess—was that negotiations were going on throughout the United Kingdom in respect of a new contract for chemists. Scotland was trailing a bit behind in these negotiations. Indeed, the English contract was finished some time in June and, I think, was due to come into operation at about the beginning of this month.

Your Lordships will understand that the Scots, having looked at things, then decided, "We'd better get our legislation in the same way and in the same shape as in England and Wales so that when our turn comes we can introduce it". But what happened was that, despite all that was being said in England—and there was considerable opposition to the new contract for the chemists in England—the new Minister of Health and Social Security discovered that the opposition in England and threats of legal action were such that the department, looking again at its legal powers, decided that they were not enough. I understand that the position now in England is that they are going to introduce primary legislation—not amending legislation as a by-blow of a handy Act, but primary legislation—with full discussion of the whole thing so that the Secretary of State for Health and Social Security will have the powers, if Parliament gives them to him, to introduce this new contract.

But in Scotland they were still negotiating the contract and the negotiations were not accepted. I think Mr. McKay went to the British Pharmaceutical Council in Scotland on 9th October, not all that long ago, and it was accepted overwhelmingly there by that council. I have never known of anything of any importance being rushed so quickly because, although they have put in an amendment to bring us up to what was English law and, as they thought, sufficient, the English having discovered that their law was not sufficient, the Scots then decided to use this Bill to give this additional power to the Secretary of State. I do not think that that was at all evident to us all when we discussed this last week. Certainly, I had not received a single scrap of paper about it from anyone either for or against it.

But then I started reading about it and discovered that things were not quite as they seemed according to what we were told by the noble and learned Lord the Lord Advocate. Indeed, one MP—and we must remember that all this took place, the putting down of this amendment, while the Commons were not sitting, though there is nothing wrong in that—was still writing to the Secretary of State and, when we were discussing it, was about to receive a reply from the Prime Minister, about complaints that that MP had had about Clause 55. It means that if we pass this, we are out of line with England. It means that the new Scottish contract will be in operation; whereas the people who started it will now not have it, I gather, before 1987. That is the position they have got themselves into in England and Wales. As for the canny Scots, we decided that we would race in with this new piece of legislation and cover the situation,

Now what happens? Under the present contract, I believe, the position is that a pharmacist can start up anywhere and will be on the list and it will depend on himself as to what he is able to make of his business. Two things are happening now. First of all—and this is something which I think the Government can act on under existing legislation—the financing of the new contract is going to mean a lower payment to the smaller pharmacy. It could be terribly important, for it might be serving an area where there is none for miles around. Whereas at the present time the small pharmacists get an advantage over the bigger ones, which do a bigger business, their emolument is being reduced and that of the larger ones is being increased relatively speaking.

To the income to the smaller pharmacists—and you find them in rural areas, you find them on the outskirts of towns and in housing areas—it will mean a loss of about £1,200 to £3,000 per year. This must be added to the burdens that they are already carrying in Scotland with the recent increase in rates and the fact that the introduction of the new lists for chemists under the limited list scheme has meant a reduction in the number of prescriptions. In addition, there has been the increase in the cost of prescriptions, which has meant that people who are not getting help from the state have to think twice about whether they will have two prescriptions or one prescription. It means that there has been a squeeze already upon the smaller chemist, who will find it difficult to compete, and this is virtually the last straw in that respect. And it is the small people who are going to be hit.

It was suggested, I think in an article in the Scotsman in September, that the number of people affected in Scotland—and we must remember that there are about 1,300 chemists in Scotland—will be about 209; and that 106 chemists who are dispensing less than 1,000 prescriptions will be the worst affected and will be likely to close. I would think that that is 50. I know a gentleman who takes a different point of view and who very much knows what the Government are doing and he was suggesting to me that the number would be 75. But I noticed that, in England and Wales between the months of June and September, where in June it had been suggested that 200 would close, it was 600 by the time it came to September. The source of that information is the Guardian and a very timely article that was in today's The Times.

There it is. It is the smaller man who is going out, who is going to be squeezed. It is the person who has been badly squeezed. Additionally to the financial squeeze—and this is highlighted very considerably in respect of this new clause—the Government are taking the power within regulations to enable a committee of the health board, to be called the pharmacy committee, to determine whether or not there should be any pharmacist in any particular area. If within two miles there is another pharmacist, they will be denied the facility of having a chemist's shop in the area. We have not been given any of this information. I have had to glean it very quickly. Indeed, for any newcomer there is the double business, involving whether or not he will get on to the list and whether or not—apart from the pharmacy—the place where it is proposed to be will be allowed by this new committee.

We have not been told how this new committee will be formed. I was told this morning by, I think, a member of the Pharmaceutical Council of Scotland—a Mr. McConnell—that it will be done on the basis of the health board with three health board laymen, three chemists and, probably, a layman as the chairman. We are giving to this (so far as the general public is concerned) unknown, faceless committee, the right to determine where a chemist's shop will be and how many there will be, whether in a High Street, a rural area or anywhere else. I should be fair. I think that in Scotland there are about 50 pharmacies which could not be justified by the business they do. But they are essential and I think they will get support at the present time, though there is no guarantee that they will continue because the pressure is on to save money. My concern is for the customer.

Mr. Craigen, the Member of Parliament for Maryhill, has been taking up this matter. He has been visiting the chemists in his area and he received a letter from one who said: Under the terms of the new legislation, small pharmacies will be penalised financially and in addition small pharmacies presently dispensing fewer than 1,300 prescriptions per month will be closed. As a small community pharmacist serving the people of Milton"—

that is in that constituency in Glasgow— as I have for the past twelve years, I will become a victim of the new legislation and the community which I have served will be deprived of a dispensing service in their own area which they have enjoyed for over thirty years. I need not point out to you the undoubted disadvantages of this proposed action on the people of Milton"—

that is an area of multiple deprivation. The letter continues— The first victims would of course be the elderly, the disabled and mothers of young children who, at present, can rely on the services of neighbours to uplift prescriptions in the course of their daily shopping.

It will be very difficult. They will probably have to get somebody to travel by bus to some other area, and bus fares are not something that can be ignored these days. The letter continues that they will have to make a journey to the Saracen Street area

which is outside their area— by bus themselves or ask the good neighbour to do this on their behalf.

I know that the idea is to get a more efficient service, and by that I mean one that costs less, but it means that people will certainly be deprived of what is presently a competitive service.

I do not like the idea of introducing in this kind of way a new power, not for the Secretary of State, but for a new body—a sub-committee of a health board. They will be able to determine. The House does not know the guidelines which have been laid down. In fact, I doubt whether many people know what the new contract involves, and this is probably part of the bargaining for this new contract. I suggest that it would be far better, as they have to wait in England and Wales, for us to wait in Scotland as well. That will give us time to talk about it and find out who is right and whether everybody in Scotland agrees about it.

So far as I understand, in England and Wales—and it happened in Scotland, too—an action committee has been set up. It has blossomed and we now have that competitive organisation, the British Pharmaceutical Association. I have no indication of how many members it has, but I gather that in Scotland there is quite a number. It may be that this is all right, but should we take this step in advance of England, meaning that we were just hoping to catch up and go ahead with this, rather than wait and do it all at the one time? This is the kind of thing at which we should look twice, depending as it does on an important service to old people, to young people, to people who are sick, as well as the effect upon a certain number of chemists with the effect on employment.

We should be given a Utile more time and the Government should, without any further prodding from me, withdraw this clause. That does not mean to say that they cannot bring it back, perhaps at the same time as the English legislation. They could combine the two, as a Minister suggested in regard to rates reform. That would be much simpler than what is being suggested. So my plea to the Government is to withdraw this clause, so that we can get far more information about who will do it and who will be the people detrimentally affected. I do not think that doing this so quickly is the proper way to legislate. There was the new contract decided on 9th October, snags were already discovered in England, and then between the 9th and the 15th October the Government took action in Scotland. That is not the right way to do things and I suggest that the Government withdraw the clause. My Lords, I beg to move.

Lord Bruce-Gardyne

My Lords, in all the years that the noble Lord, Lord Ross, and I have sat on opposite sides of both Chambers, I do not think I can recall a single occasion when I felt drawn to support an amendment moved by the noble Lord. But there must be exceptions to every rule and I must confess that I am very much of a mind to support his amendment this afternoon, although I should hasten to say that I am not sure I would do so for exactly the same reasons as those that he has advanced.

I am concerned, in particular, about the second aspect of the consequences of this amendment to which the noble Lord referred. He referred to the impact of what I would call the proposed reduction in cross-subsidisation between the larger and smaller chemists which, as he rightly pointed out, does not arise directly from this amendment, although it is very much related to the whole question of the new contract. He referred also to what I believe arises directly from this clause as it now stands in the Bill, the proposition that the Secretary of State should be empowered to introduce regulations by which a pharmacy committee should control access by incomers to the pharmacy profession to an NHS contract.

I think that the way in which this clause was amended last week in Committee was just a little bit naughty. Your Lordships will recall that in the summer the noble Lord, Lord Harris, raised on an Unstarred Question the whole matter of the proposed new pharmacy contract, and since the noble Lord is here in person I certainly do not intend to elaborate on the debate which he staged then. But I think your Lordships might, at least, agree that he and other noble Lords expressed considerable concern about the nature of this proposed new contract.

5 p.m.

I read reports in the press, during the Recess, as I think the noble Lord, Lord Ross, did, to the effect that the Government have discovered, as the noble Lord said, that primary legislation would be required to bring in the new contract with pharmacists along the lines which the Government were proposing. I am bound to admit that, having read this, I took the opportunity to forewarn my honourable friend the Minister for Health in another place that I could not help feeling that such primary legislation might come in for some criticism and disagreement in your Lordships' House, certainly judging from the Unstarred Question debate of the noble Lord, Lord Harris, in the summer. My honourable friend told me that there was absolutely no decision about taking primary legislation. Quite obviously, apart from anything else, there was the question of whether there was a slot for such primary legislation.

But in Scotland things were easier. On 15th October at Report stage my noble and learned friend the Lord Advocate moved his Amendment No. 32. At col. 524 of the Official Report he said: The provisions now sought do not differ in principle from those which Clause 55, as originally drafted, sought to achieve. The amendment to Section 27 does not in itself alter the right of a pharmacist to be included in a health board pharmaceutical list and thereby enter into a contract with the National Health Service … Regulations may make the right of a person to have his name and premises included in a health board's pharmaceutical list… subject to the board's pharmacy practice committee being satisfied that the granting of an application for inclusion in the list is necessary or desirable from the point of view of securing adequate provision of pharmaceutical services to the NHS in the locality of the proposed pharmacy".—[Official Report, 15/10/85; col. 524.] In other words, it certainly very substantially altered the terms of potential entry into NHS contracting in the pharmacy trade. I must say that it proposed to alter it in what I find an extremely worrying way.

The noble Lord, Lord Ross, referred to this new body, the pharmacy committee, which he said had not been at all clearly spelt out to us. It is my understanding—I am sure that my noble and learned friend the Lord Advocate will correct me if I am wrong—that this is to be a body consisting of three chemists, three gentlemen from the local family practitioner committee (who presumably, by the sound of it, will be doctors) and a lay chairman. They will be empowered to decide whether or not it is necessary or desirable that a new pharmacist should have access to an NHS contract. If they decide that the new pharmacist should not be so empowered, he has a right of appeal. To whom? Not to the Secretary of State, not to an independent arbitrator, but to the adjacent pharmaceutical committee made up of a precisely similar group of people.

I accept that chemists will be in a minority on these new bodies—a minority of three out of seven—but I submit to your Lordships that a body consisting of three chemists, three doctors and a lay chairman is not perhaps the most certain body to resist suggestions that a little additional competition in the interests of the customer would not be necessarily in the interests of the pharmaceutical profession. In other words, it seems to me that this proposal smacks considerably of rigging the entry into the profession by a professional cartel.

I know that my right honourable friends have pointed out that as things stand the open access to the right to provide NHS prescriptions is extremely costly for the health service. I would be the last to complain about measures aimed to achieve economies in the health service. I must point out to your Lordships that the only economy expected to be achieved by this proposal for the United Kingdom as a whole is £2 million a year net. That is not really a vast sum. Furthermore, I would submit to your Lordships that the fundamental reason why the present system of open access to the right of NHS prescribing is so costly to the health service is that it is done on a cost plus basis. I should have thought that we might have learnt by now, not least by the experiences of the Ministry of Defence, that a cost plus basis is a recipe for wasting public money. It is that at which we should be looking again rather than arranging a fairly marginal saving by any standard on the cost of the pharmacy contract, and in return giving to the profession something not wholly removed from a power of veto on new entry into the prescribing aspect of the profession's work.

For those reasons, I am bound to say that I find myself for once in support of the amendment moved by the noble Lord, Lord Ross of Marnock.

Lord Ross of Marnock

My Lords, before the noble Lord sits down, will he make it clear whether the saving of £2 million which he suggested—I heard a higher figure—is not related to Scotland?

Lord Bruce-Gardyne

My Lords, I bow to the greater knowledge of the noble Lord on that point. The figure is £4 million gross but £2 million of that is earmarked for return to the profession, so it is £2 million net in public expenditure terms. It was my understanding, although I stand to be corrected by the noble Lord, that it was a United Kingdom figure. If the noble Lord is telling your Lordships that it is purely an England and Wales figure, I accept his judgment on that.

Lord Tordoff

My Lords, it may seem curious for an Englishman to be speaking on a Scottish Bill (and I apologise for the fact that the noble Lord, Lord T aylor of Gryfe, is not able to be here today as he certainly would have joined in the debate) but I do not really apologise because I think that this is the thin end of a wedge which will hit us South of the Border, and in any case there is a matter of principle here in which we should all be interested. We are grateful to the noble Lord, Lord Ross of Marnock, for having raised this amendment on Third Reading today.

I have been lobbied by pharmacists in Scotland. I wonder whether we can continue to use the word "pharmacist" rather than "chemist" because chemists and pharmacists are rather different and we are talking here about pharmacists. As a long time chemist who was not a pharmacist, I object to the confusion. I have been given an example which illustrates the problems that already exist and the problems that are created by the Government's amendment. May I echo what was said by the noble Lord, Lord Ross of Marnock, that this is a very curious way of introducing legislation. There is a tendency, particularly for English Members of your Lordships' House, to let the Scots get on with it and to be assured that noble Lords such as the noble Lord, Lord Ross of Marnock, are keeping a beady eye on Scottish legislation and will not let anything slip through on the nod. I am not saying that he failed on this occasion as far as Scotland is concerned but, as I said before, this is the very thin end of a very big wedge. It is unfortunate that it should be introduced in a Bill which really has very little to do with the subject of this amendment. Certainly the terms in which it was moved by the noble and learned Lord the Lord Advocate last week would have given nobody any suspicion of the issues at stake.

This is my illustration. Let us imagine a small town which two years ago had one pharmacy situated close to a doctor's surgery. The pharmacist had owned this pharmacy for 20 years or more. Suddenly along comes another pharmacist who sets up a practice much closer to the doctor's surgery. It is that kind of thing that I understand this system is intended to stop. Nevertheless there have been cases like that, and I seek to show that in fact this clause will make the situation worse.

As a result of this leapfrogging, the original pharmacist begins to lose business to the new one. After a time his business drops below the crucial level. He is forced out of the National Health Service under the terms granted to this committee. His income anyway is therefore reduced by between £100 and £200 a month. Dispensaries dispensing more than 1,300 items a month will be untouched. The owner then has no alternative but to shut up shop. Although he will receive compensation of approximately £16,000 in this case, it is not enough to pay redundancy and settle on his stock at a loss. This, after a number of years of operating in the health service, is not good enough.

The ultimate irony is that the new pharmacy will dispense national health prescriptions for the whole town and will be largely protected from any future competition. This is extremely curious, coming from this Government in particular. They are great believers in market forces and in small businesses, yet they seem by this amendment to be attacking the very people whom they seek so often to support. It may be said by the Government—and I am sure that it will—that this change is being made after consultation with the appropriate body. However, I must tell the Government that that appropriate body, because it was having secret discussions with the Government, did not check with its own contractors or even with the pharmacists. They have not been allowed to vote on whether or not they want this deal. That surely cannot be good enough.

It is my understanding that the saving in Scotland is likely to total £250,000. Therefore the figure given by the noble Lord, Lord Bruce-Gardyne, must include the whole of the United Kingdom and not relate just to Scotland. It is interesting that that figure is being bandied about. It must mean that it is the Government's intention to extend this particular system throughout the length and breadth of the United Kingdom—again, as far as I know, without any consultation with the people involved and certainly without any consultation with Parliament. That is why I say that this is the thin end of the wedge, because the Government are using the figures at the thick end of the wedge to justify what they are doing at the thin end.

I am not an expert on this subject, but the noble Lord, Lord Ross of Marnock, has opened up a very interesting debate. This matter is not one that should be going through on the Third Reading of a rather complicated and tortuous Bill. I know that the noble and learned Lord the Lord Advocate has been complimented on his flexibility at the Report stage of this Bill and for the way in which he listened to the requests made to him at earlier stages. I hope that on this occasion he will be equally flexible and do as the noble Lord, Lord Ross of Marnock, suggests; that is, allow this whole matter to rest until it can be fully debated in a proper measure brought before Parliament to cover the whole of the pharmaceutical business in the United Kingdom. I certainly support the amendment.

Lord Harris of High Cross

My Lords, the noble Lord, Lord Bruce-Gardyne, wondered whether his reasons were the same as those of the noble Lord, Lord Ross, in opposing Clause 55. Even from the Cross-Benches I have begun to learn that in politics, if one can find people who will agree with one on a certain action or inaction, it is not necessary to probe too deeply to discover whether their reasons precisely coincide with one's own. For my money, the fundamental objection in principle to Clause 55 is that in place of relying as hitherto on financial incentives and disincentives to influence the number and location of dispensing chemists, the Government are now proposing to unleash the ultimate sanction of compulsion and prohibition against the opening of new small businesses in the form of what are popularly called chemists' shops and what the noble Lord, Lord Tordoff, correctly named the new pharmacies.

I first ventured to raise this issue in the form of an Unstarred Question in June, when I warned that the Government risked bringing themselves into some degree of ridicule by supporting the lobby of existing chemists in ending the open entry into the retail market. I can only say that it has turned out at least as badly as any critic could possibly have anticipated. Thus after the previous Minister of Health, Mr. Kenneth Clarke, had nailed his colours to this already crumbling mast, his successor, Mr. Barney Hayhoe, announced in public that the Government could not do the chemists' dubious work for them by shutting the door on new pharmacies in the United Kingdom—in England and Wales—because, present powers are almost certainly inadequate to introduce the limitation of entry provisions.". Mr. Hayhoe went on to say: '"New primary legislation is required to provide the necessary powers". As the noble Lord, Lord Ross, has said, this explains how it came about that suddenly at Committee stage the noble and learned Lord, Lord Cameron, moved an amendment to add a new clause, Clause 55. When on scrutiny that clause was found to be inadequate, the noble and learned Lord went on at Report stage to move an amendment which enlarged Clause 55 into a complex rigmarole that is impossible to understand without the benefit of several highly-paid lawyers but which purports to give the Government power to restrict the entry into the market of new retail pharmacists.

In passing, one paradox is that Scotland, which has led the way in liberalising shop opening hours and licensing laws, is here chosen to pioneer the exactly opposite process of regulation and outright restriction.

5.15 p.m.

At Report stage the noble and learned Lord, Lord Cameron, sought to justify that backward step as implementing an agreement between the Minister of Health and representratives of the profession in the pharmaceutical services negotiating committee. The truth, which was already public by last May, was that when the terms of the secret negotiations were out in the open the Company Chemists' Association completely repudiated the agreement, which its own representatives on the negotiating committee had no mandate to accept. So there is no wide agreement by pharmacists and chemists on this matter.

Indeed, in the present issue of the Pharmaceutical Journal the president of the Pharmaceutical Society, which is the pharmacists' professional body, expresses severe misgivings about the whole process and the proposal. He concludes by expressing the view that: The recent proposals strike at the basis, structure and operation of the entire pharmaceutical profession". He added that he hoped to see a wider debate next time. I have to ask: why wait until next time for this wider debate? If we follow the noble Lord, Lord Ross of Marnock, into the Lobbies it will not only be good exercise but will get rid of this trumped-up amendment now. Then the wider debate can commence before legislation has cast these far-reaching changes into tablets of stone.

Lord Campbell of Alloway

My Lords, I am rather concerned about a curious aspect of this affair—the imposition of a fetter upon the liberty of a person to exercise his calling without any form of appeal to the courts of law. I ask my noble and learned friend whether, from the depths of his legal experience, he is aware of similar precedents in any analogous circumstances. Shutting the door on new pharmacists is inevitably a subject for primary legislation. Primary legislation can do anything, as all your Lordships know. But ought it to deprive a man of exercising his calling without recourse to the ordinary courts?

Lord Morton of Shuna

My Lords, I also support the amendment of the noble Lord, Lord Ross of Marnock. At Report stage the noble and learned Lord the Lord Advocate stated that this new contract had the substantial agreement of pharmacists. It certainly appears from strong representations made to me, and I understand to numerous other noble Lords, that there is a vociferous body of pharmacists who are strongly opposed to this measure and who claim to represent at least 40 per cent. of the pharmacists in practice. If that is the position surely it is wrong suddenly to add to this Bill a form of rationing of premises which is not to apply to England, so that one has the curious result that certain small chemists in Scotland will be paid less per prescription than the chemists in England. That will certainly raise anger in the future.

I also ask the noble and learned Lord the Lord Advocate: has the Scottish Consumer Council been consulted? Of course, ordinary people as distinct from pharmacists are concerned as to where pharmacies will be. The Scottish Consumer Council was consulted in great detail on the small claims provisions in the Bill, but was it consulted about this provision?

Lord Cameron of Lochbroom

My Lords, I have obviously listened very carefully to all that has been said by noble Lords in various parts of the House but I am bound to say that I cannot commend the acceptance of the amendment proposed by the noble Lord, Lord Ross of Marnock, that the clause should be dropped.

On Report I explained that in Scotland, as in England and Wales, the Government had reached substantial agreement with representatives of the profession on a new contract for community pharmacists, but that progress towards implementing those proposals could not be completed until regulations were available which authorised restriction on entry to health board pharmaceutical lists. I accept, of course, that that power under regulations required primary legislation.

I should make it clear that certainly my understanding is that the new contract proposals which were agreed after negotiations, which proceeded over a period of months prior to October of this year, are supported by the substantial majority of pharmacists in Scotland. May I say at the outset that the body with which my honourable friend the Minister dealt with is, of course, a body which represents all pharmacists in Scotland. Indeed, it was at a meeting of the pharmaceutical general council on 9th October this year that the motion to approve the new contract proposals was approved unanimously by those who were present. My information is that 39 of the 44 members of the council were present.

The general council itself draws its membership from all 15 health board areas in Scotland. The council is recognised by the Secretary of State as representing the general body of community pharmacists in Scotland on remuneration matters and on terms and conditions of service. It is an elected body and, as I said, on this particular occasion those present at the meeting voted unanimously to accept the new contract proposals. Before Report stage I received a letter from the Scottish Department of the Pharmaceutical Society of Great Britain—that is, the professional body for all pharmacists—which expressed strong support for the proposals. I understand that other noble Lords may have received such a letter.

I accept, of course, that a number of pharmacists are opposed to the scheme—notably small contractors who, in general, are not opposed to the contract limitation as such (and that is all that we are dealing with at Clause 55) but who consider that they may be at a disadvantage as a result of changes in remuneration. We are not dealing with that aspect in this clause. I also accept that there is apparently some opposition from some multiples according to a leading article in last week's Pharmaceutical Journal. However, that article indicated that it was in the interests of the profession that the Bill should now be translated into law. I understand that that was said in the editorial comment which appears in the 19th October edition of the journal. That would suggest, at least to me, that there is general support throughout the pharmacists' profession for what is intended by the powers given under these new arrangements.

The new arrangements are designed to provide a network of pharmacies located where they can best serve the needs of patients without the extravagant use of National Health Service resources. They include greater incentives for economy and efficiency and disincentives against over-supply, while at the same time providing safeguards for the funding of essential small pharmacies. There is no suggestion that those pharmacists already on the list should be required to give up their contracts. I wish to make that entirely clear.

However, there is special provision to enable small pharmacies adversely effected by the contractual arrangements to withdraw from their National Health Service contracts or to relocate their business to areas where they could better serve the needs of the patients. It is certainly not the intention that additional National Health Service dispensing contracts should be refused where there is a genuine service need. The overall package aims to and, I believe, does achieve a realistic balance between competition and efficient provision of National Health Service dispensing services. It thus frees the resources for other demands on the National Health Service. The Government are satisfied that the new arrangements are in the interests both of the public and of the pharmaceutical profession as a whole, and that there is a width of support from within the profession, as I have already mentioned, which serves to endorse this view.

I answer certain of the points raised by noble Lords in this way. In the first place, issue was taken with the fact that the amendments were put down at a late stage. Of course, the amendments were originally considered by your Lordships at Committee stage. At that stage it was the principle upon which the new contracts were being negotiated; they had already been set out and they included restriction of entry. The noble Lord, Lord Ross of Marnock, is quite correct in saying that, thereafter, it became recognised that the legal powers to restrict entry in the way in which it is intended by the additional amendments which I proposed on Report are not, after all, available. Certainly it is clear that my honourable friend in another place has indicated that primary legislation would be required for England and Wales although, having read The Times today, there appears to be some doubt on that on the part of the profession itself. However, I note that in that article the professional body—the Pharmaceutical Services Negotiating Committee—appeared to support the proposals which are, for Scotland, within the context of this clause.

5.30 p.m.

I do not fear coming before your Lordships to suggest that Scotland should be in the vanguard of a change. I have never thought that that was necessarily a bad thing at all. However it gives your Lordships an opportunity today to consider what is intended within the context of these amendments. I make it abundantly plain that what the amendments seek to do first of all is to require that an applicant, in applying to be placed upon the list, also needs to state the premises from which he will operate. That of course is a necessary precursor to being able to determine whether the applicant, who will only be concerned with National Health Service dispensing—I can assure my noble friend Lord Campbell of Alloway that he is not precluded from acting as a pharmacist in the ordinary way, but would simply not be on the list for a particular health board area for acting to provide pharmaceutical services—could meet a need which was not already being catered for.

We should then be rid of one of the difficulties to which the noble Lord, Lord Tordoff, alluded; namely, that of leapfrogging, that is to say, where a person who is already on the list providing pharmaceutical services perfectly satisfactorily finds himself in competition with a new entrant who, by reason of good fortune, is able to find premises closer at hand, say, to a doctor's surgery and who thereafter takes away a part of that pharmacist's business. That cannot be good for the general standing of the pharmaceutical profession so far as the dispensing of contracts is concerned.

Lord Tordoff

My Lords, if the noble and learned Lord would permit me to interrupt him, I know that this is the Third Reading but I think it is fair to say that I accepted that point. What I sought to suggest was that in fact in certain instances these provisions could make it worse and not better.

Lord Cameron of Lochbroom

My Lords, as I understand it, it was suggested by the noble Lord that these provisions would mean that the small pharmacist who was already in business would thereafter find that his business had disappeared to the extent that he was required to give up business. What I am pointing out to your Lordships is that he would not be placed in that position if these regulations were already in force; that is to say, the second pharmacist would not be in the area to compete with him unless, as is suggested here, it were already established that it was for the proper provision of services and to meet a need that that second pharmacist had come into the area. That is the point which I think the noble Lord was making, and I hope that I have answered him in that regard.

The noble Lord, Lord Ross of Marnock, mentioned certain figures in relation to remuneration and I simply say again that I am not suggesting that we are dealing with the matter of remuneration in these particular amendments. But I think it is only right and proper to make it absolutely clear that while it may be that if a pharmacy closes it will be less convenient for some, it is not the case that those pharmacies providing an essential social service in areas where they are needed will be deleteriously affected.

There is at present an essential small pharmacies' allowance which is primarily but not exclusively of benefit to rural pharmacies. Under the new arrangements this will be enhanced in particular for the benefit of those in the smallest subscription groups. So the Government fully recognise the difficulties which arise in this area.

My noble friend Lord Bruce-Gardyne, and the noble Lord, Lord Ross of Marnock, made reference to the provisions for the new committee. Of course, under the 1978 Act, to which these amendments are directed, it is the duty of every health board to make, in accordance with the regulations, certain arrangements in respect of its area for the provision of pharmaceutical services. This clause sets out to ensure that the regulations will contain the power first of all to provide that the health board shall set up a particular committee in order to deal with the matter, that committee being the pharmacy practices committee which is referred to in the clause. Furthermore, it goes on to provide that there shall be, by way of regulations, provision of an appeal from the decisions of that committee. Obviously, at the end of the day this will be a matter for regulations, but I am advised that the proposal as thought of at present would be that the pharmacy practices committee would comprise four lay health board members and three pharmacists, with a lay chairman. Of course I make clear, as your Lordships will have observed, that it is the duty of the health board to make provision within its area for pharmaceutical services.

So far as the appeal committee is concerned, it is proposed that it would be made up in a similar fashion, that is to say, with four lay members and three pharmacists who have no interest in the applications. Obviously, what has been said in your Lordships' House would necessarily be taken into account in the final determination of these matters so far as regulations are concerned.

I think that my noble friend Lord Bruce-Gardyne in a sense complained of the fact that this matter appeared to be brought into this Bill at a late stage. I hope that I have been able at least to explain how it was that this matter came to arise. Nevertheless, I believe that the purpose behind this clause is a proper and a salutary one, which I commend to your Lordships.

Lord Bruce-Gardyne

My Lords, I apologise for interrupting my noble and learned friend but it would appear that he is leaving the question of appeal. Could he just clear up the point raised by my noble friend Lord Campbell? Is there any precedent for appeal running from one of these professionally dominated bodies to the adjacent hunts?

Lord Cameron of Lochbroom

My Lords, I am always chary of giving an immediate reply, but I am fairly confident that such provision is not unknown in this field. I think I am correct in saying that there is something of a similar character as regards disciplinary proceedings under the National Health Service regulations. I say that off the top of my head and I may well be wrong. As I say, I cannot answer the point directly and, should it be necessary, I shall certainly undertake to attempt to answer my noble friend in writing in due course.

Lord Winstanley

My Lords, will the noble and learned Lord just deal with this for a second as it is on the point that he has answered? Appeal to the Secretary of State in relation to disciplinary hearings in England and Wales is surely open. Are we to understand that it is different in Scotland?

Lord Cameron of Lochbroom

My Lords, I do not think that I was attempting to suggest different. There is in fact an appeal at the end of the day to the Secretary of State. I think I am right. I hasten to add that I say what I did with caution, but I am fairly confident that there is a similar procedure elsewhere within National Health Service regulations. It may be that I am wrong. As I say, I undertake to follow this matter up if necessary.

The noble Lord, Lord Harris of High Cross, on the Cross-Benches referred to the question of restriction as something that is in a sense new to the NHS. I would take issue with him on that. I do not accept that the new arrangements are contrary to the basic principles of the NHS. There the general aim is to secure that where possible a service is available where there is a need. It is clearly desirable, as I said earlier, that there should not be over-provision in some areas to the detriment of national health services generally. It is that unnecessary over-provision that this clause is designed to meet.

Nor is limitation of entry, as such, contrary to the principles of the NHS, since certain noble Lords will be aware that in the comparable area of general medical services there is machinery designed to control entry and to assist in securing the provision of those services throughout the country. The principles behind these further proposals and amendments to the 1978 Act are not in themselves novel.

Finally, the noble Lord, Lord Morton of Shuna, referred to a vociferous body of opposition He mentioned about 40 per cent. of pharmacists as being opposed to the new contract proposals. I have endeavoured to make inquiry about this. That is not in accordance with the information I have been given. Estimates must vary, but my information is that the pressure group which has been formed—the British Pharmacists' Association—claimed recently to have about 100 members in Scotland, and that is out of about 3,000 pharmacists registered in Scotland. I should add that, of that 100, some may not necessarily be community pharmacists. I am also advised that there are in the order of 1,100 community pharmacists in Scotland. The information that I have—and I recognise that it may well be inaccurate—is that about 60 of those have joined the unofficial body. That does not seem to me to suggest that the pressure group controls as much as 40 per cent. of all pharmacists.

The noble Lord also asked me about consultation with the Scottish Consumer Council. I have to say quite unequivocally that the Scottish Consumer Council was not consulted. This has always been a question of negotiation between the Government and the responsible professional body. As I indicated, that has taken place over a period of time and resulted in acceptance by that body in the manner which I have described on 9th October of this year.

I have taken some time endeavouring as best I may to respond to the arguments that have been put forward from all quarters of the House. I make it clear that the Government would wish that these new arrangements, based upon this clause, should be available to Scottish pharmacists in due course on the basis of the new contract provisions agreed with the general council. I would say only that it is the Government's view that there is much to be gained from what is proposed in this clause. For all those reasons, and bearing in mind that, as I have indicated, the Government will make certain that the essential small pharmacies allowance will continue in being, I invite your Lordships to reject the amendment.

5.45 p.m.

Lord Ross of Marnock

My Lords, we are grateful to the Lord Advocate for taking his time in answering the debate. The fact that he did so was an indication of the importance of this, which he probably did not appreciate when he moved the amendment on Report. In a way, I felt rather sorry for him. All the speeches that were delivered from the Cross-Benches, from his own Benches, from the Liberal Benches and from these Benches were against him. He had not a friend in the place. But I suppose that he will say, "I am the representative of the Government. I represent this great majority", and what not.

That may be exactly what is happening in the pharmaceutical industry. People were mandated to go ahead with secret negotiations. May I quote what I thought was a very apt comment by Mr. Jim Bannerman from Glasgow, who is a former president of the Pharmaceutical Society of Great Britain? He said: As in all representative bodies you have a negotiating committee with a mandate, but they are not mandated to wipe people out". That is the essence of all this: people are being wiped out.

I think that the noble and learned Lord was a bit unfair to the noble Lord, Lord Campbell of Alloway. This is a restriction on qualified people practising their profession. It is taking away a right that they presently have, and it is taking away a right only in part of the United Kingdom. When he started amending Section 27 of the 1978 Act at the Committee stage he thought that he was giving Scotland the same powers as England and Wales. Now we are way beyond England and Wales in the power to restrict—in the power that will be given to a sub-committee of a health board to say that there will not be a pharmacy. Perhaps I may say to the noble Lord, Lord Tordoff, that everybody in Scotland calls it the chemist shop. Let us keep with the people.

The noble Lord, Lord Morton of Shuna, asked whether the Scottish Consumer Council was consulted. The noble and learned Lord says, "Oh, no; this was always done by the negotiating committee". When customers—patients who are ill and their families—are being deprived of a service which is there or would readily be there, considering the consumer does come into it. On this occasion it should have been worthwhile for the Government to consult the consumer.

I do not think that the case has been made out for delay. If the provision is going to come later in primary legislation for England and Wales, why not see that the steps are taken together? I think that it is very important that chemists in Scotland or chemists who intend to set up business in Scotland should not be impeded, when they will have the freedom in England and Wales until the primary legislation is effective, I understand, in about two years' time.

That is all I am saying. We are not voting against the provision. We want to withdraw it so that the Government can introduce it and let us have a proper debate. Many noble Lords, I think, wish that this was just the Committee stage, with a full debate on Report and Third Reading to follow. We do not have all the information about the committee and about the appeal. There is nothing in the clause about the appeal. We have nothing about the contract. There is not a single person here who has seen the new contract, which is now only going to be applied in Scotland. That is the bit that sticks in my throat a little.

Let us go canny and be traditional Scots; let us see exactly what is in this poke, whether it is a pig or anything else. Let us introduce the primary legislation when everyone can have the opportunity of having a go at it. I must proceed with my amendment, and I trust I shall have support from right-minded people in this respect.

5.50 p.m.

On Question, Whether the amendment shall be agreed to?

Their Lordships divided: Contents, 95; Not-Contents, 75.

Airedale, L. Leathers, V.
Ampthill, L. Llewelyn-Davies of Hastoe, B.
Ardwick, L. Longford, E.
Auckland, L. Mackie of Benshie, L.
Aylestone, L. McNair, L.
Beaumont of Whitley, L. Maude of Stratford-upon-Avon, L.
Boston of Faversham, L.
Bottomley, L. Mayhew, L.
Brockway, L. Milford, L.
Brooks of Tremorfa, L. Morton of Shuna, L.
Bruce of Donington, L. Munster, E.
Bruce-Gardyne, L. Nicol, B. [Teller.]
Caradon, L. Northbourne, L.
Carmichael of Kelvingrove, L. Orr-Ewing, L.
Carnegy of Lour, B. Paget of Northampton, L.
Chitnis, L. Peart, L.
Cledwyn of Penrhos, L. Ponsonby of Shulbrede, L. [Teller.]
Collison, L.
Craigavon, V. Raglan, L.
Crawshaw of Aintree, L. Rathcreedan, L.
David, B. Rea, L.
Elwyn-Jones, L. Ritchie of Dundee, L.
Elystan-Morgan, L. Rochester, L.
Ennals, L. Ross of Marnock, L.
Ewart-Biggs, B. Rugby, L.
Ezra, L. Russell of Liverpool, L.
Fisher of Rednal, B. Sainsbury, L.
Foot, L. Saltoun of Abernethy, Ly.
Gallacher, L. Scanlon, L.
Galpern, L. Selkirk, E.
Glenamara, L. Somers, L.
Graham of Edmonton, L. Soper, L.
Gregson, L. Stallard, L.
Grey, E. Stanley of Alderley, L.
Hampton, L. Stedman, B.
Harris of High Cross, L. Stodart of Leaston, L.
Hatch of Lusby, L. Stoddart of Swindon, L.
Hayter, L. Strabolgi, L.
Heycock, L. Taylor of Blackburn, L.
Houghton of Sowerby, L. Taylor of Mansfield, L.
Howie of Troon, L. Tordoff, L.
Hughes, L. Underhill, L.
Irving of Dartford, L. Wallace of Coslany, L.
Jacques, L. Walston, L.
Jeger, B. Wells-Pestell, L.
Jenkins of Putney, L. Whaddon, L.
John-Mackie, L. Williams of Elvel, L.
Kilmarnock, L. Winstanley, L
Kintore, E.
Allenby of Megiddo, V. Brabazon of Tara, L.
Belhaven and Stenton, L. Brougham and Vaux, L.
Belstead, L. Butterworth, L.
Bessborough, E. Caithness, E.
Cameron of Lochbroom, L. Lane-Fox, B.
Campbell of Croy, L. Lauderdale, E.
Chelmer, L. Long, V.
Cox, B. Lyell, L.
Cullen of Ashbourne, L. McFadzean, L.
Darnley, E. Mancroft, L.
Davidson, V. Margadale, L.
De La Warr, E. Marley, L.
Denham, L. [Teller.] Merrivale, L.
Drumalbyn, L. Morris, L.
Effingham, E. Mottistone, L.
Ellenborough, L. Murton of Lindisfarne, L.
Elliot of Harwood, B. O'Brien of Lothbury, L.
Elton, L. Onslow, E.
Ferrers, E. Orkney, E.
Fortescue, E. Pender, L.
Fraser of Kilmorack, L. Portland, D.
Gainford, L. Renton, L.
Gardner of Parkes, B. Rochdale, V.
Geddes, L. Rodney, L.
Glenarthur, L. St. Davids, V.
Gray of Contin, L. Savile, L.
Gridley, L. Skelmersdale, L.
Grimston of Westbury, L. Sudeley, L.
Hailsham of Saint Swansea, L.
Marylebone, L. Swinfen, L.
Harmar-Nicholls, L. Swinton, E. [Teller.]
Harvey of Prestbury, L. Trefgarne, L.
Harvington, L. Ullswater, V.
Henley, L. Vaux of Harrowden, L.
Holderness, L. Vickers, B.
Hooper, B. Whitelaw, V.
Inglewood, L. Young, B.
Killearn, L. Ypres, E.

Resolved in the affirmative, and amendment agreed to accordingly.

6 p.m.

Lord Cameron of Lochbroom

My Lords, I beg to move that this Bill do now pass.

In so moving I would like to thank your Lordships for giving this Bill, in most of its parts, a general welcome. The provisions in the main—I say "in the main"—are not controversial, and together they constitute an extremely useful compendium of measures that will effect substantial and worthwhile changes in various aspects of Scots law. In particular, your Lordships will recollect that the Bill implements no fewer than four reports of the Scottish Law Commission—those on irritancies and leases, rectification of documents, negligent misrepresentation and evidence in cases of rape and other sexual offences.

Importantly, it also paves the way for a new procedure for small claims. It introduces a number of new provisions relating to the care of children and provides for increased penalties for drug trafficking offences. In Committee and at Report, the Bill was extended and improved with the inclusion of provisions relating to the incorporation of solicitors and extension of the powers of the Commissioner for Local Administration. A number of those amendments have resulted from suggestions which were made by noble Lords, in particular by the noble Lord, Lord Morton of Shuna, and by the noble Lord, Lord Wilson of Langside. I am most grateful to them and, indeed, to all who have taken part in the debates on the Bill for their helpful contributions which have led to valuable modifications in the Bill.

More generally, I should like to thank your Lordships for the care with which this House has considered this piece of legislation. I think that I can confidently say that it probably has few rivals as to the extent of the subjects and interests which it still covers. I beg to move.

Moved, That the Bill do now pass.—(Lord Cameron of Lochbroom.)

Lord Morton of Shuna

My Lords, I also welcome the Bill in general. It has been improved in the last few minutes. I should like to deal with two or three points, two of them perhaps of greater interest to more members of the general public in Scotland than some other parts of the Bill. The first is the small claims procedure which, I think, will be generally welcomed. I would, however, like to sound a warning note which I trust that the noble and learned Lord the Lord Advocate is also aware of. It is that the effectiveness of the small claims procedure will depend crucially on the rules that the Sheriff Court Rules Council will formulate. If these are complicated, too rigid and legalistic, the whole procedure will just not work.

The other measure to which I should especially like to draw attention is the provision that the local government ombudsman shall now have power over the Scottish Special Housing Association and new town tenanted houses. This will be a very useful measure for the many tenants who have complained to the ombudsman but who have been unable to have their complaints dealt with. In general, I welcome the Bill.

On Question, Bill passed, and returned to the Commons amended.