Lords Sitting of 17 March 1986

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Leicester.
The Marquess Camden—Sat first in Parliament after the death of his father.

Schizophrenia: Newspaper Articles
Baroness Elliot of Harwood: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they have noted the recent series of articles in The Times on schizophrenia, and whether they are addressing themselves to the problem.
Baroness Hooper: My Lords, perhaps I may begin by expressing the regret of my noble friend Lady Trumpington that she is unable to reply to this Question herself. She is, in fact, attending the National Schizophrenia Fellowship Conference in Oxford.
We have indeed noted the series of articles in The Times; and the noble Baroness will be aware from my noble friend's letter in The Times on 23rd December, and from the interview with my right honourable friend the Secretary of State, that we have for some time been addressing ourselves to the problems recently highlighted by The Times. In particular, two years ago we launched a specific central initiative designed to improve the quantity and quality of contact with schizophrenia sufferers needing longterm community care. Most recently the Secretary of State has announced the decision to launch a series of development projects which will help to ensure that health districts can really offer comprehensive care to people with schizophrenia living in the community.
Baroness Elliot of Harwood: My Lords, I thank my noble friend very much for that reply. I knew about the conference, which is very important, and I am very glad that the Government have taken this matter very seriously to heart. I should like to ask my noble friend one supplementary question. With the closing of quite a few mental hospitals and with schizophrenic patients living in the community, do the Government realise that it is very difficult to care for people with schizophrenia in a community and that nothing like enough help is available? Cannot something be done?—because otherwise tragedies such as people committing suicide when they go out into the world and find that they cannot cope will happen more often. I hope the Government realise that community care is vital and that it is inadequate at the present time.
Baroness Hooper: My Lords, on a number of occasions, including during the recent debate in your Lordships' House only last December, we have stated that consideration is to be given not only to sufferers from schizophrenia but to the people who look after
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them in the community. It is perhaps worth pointing out that schizophrenia tends to be an episodic illness. Many sufferers are valued members of their family circle between episodes of illness. However, where pressures become unbearable, as they certainly can, it may well be appropriate to take the patient into hospital for assessment and rehabilitation until things have settled down again. We believe that comprehensive psychiatric services would regularly provide such a service.
Lord Ennals: My Lords, is the noble Baroness aware that many of the problems which are so described apply to all sorts of other people with mental illness and that there is a very serious problem of health authorities discharging into the community patients who have been suffering from mental illness when local authorities do not have or are not using funds to provide community care? Is this not a problem which is happening all over the country? Is it not possible for the noble Baroness's department to play a more active role in tackling this problem, which in a sense lies between the health authorities and the local authorities?
Baroness Hooper: My Lords, on a number of occasions we have stated that any hospitals which it is proposed to close will not be closed unless the necessary alternative services are available to replace them. Broadly, as regards local health authorities, the Secretary of State has in mind to provide earmarked support over the the next few years, particularly for innovative projects for community care for mentally ill people in a number of districts. The results will then be carefully evaluated and publicised for the general benefit.
Lord Campbell of Croy: My Lords, does my noble friend agree that The Times has performed an outstanding service in enlightening its readers about this, the most common of the serious mental illnesses, and in particular in helping to dispel the illusion that it is simply a Jekyll and Hyde phenomenon? Is my noble friend aware that, although it is now possible, owing to advances in medicine, for many schizophrenics to live outside institutions, cases differ and there are some who are quite incapable of fending for themselves, who need care in the community or return to hospital?
Baroness Hooper: My Lords, the Government did indeed welcome the series of articles in The Times, as well as recent programmes on television concerning schizophrenia, as it helps to create a greater awareness in the community of the problems of these particular sufferers. In fact, the cases quoted were not unique; nor were they necessarily typical. I think it is necessary to say that it would be totally wrong to assume some sort of automatic link between schizophrenia and violence as a result of some of the examples quoted. However, it is certainly the Government's intention to preserve hospital or institutional remedies for this type of suffering so that those who are not capable of total care in the community can at least have periods in hospital.
Lord Elwyn-Jones: My Lords, are the Government giving sufficient help to bodies like the Mental Health

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Foundation, which are doing admirable work in this field? The Times articles rather gave the impression that no one was doing anything about it. A great deal of research has been carried out into this difficult problem. Will the noble Baroness look into the need to give recognition and encouragement to the bodies that are already at work in the field?
Baroness Hooper: My Lords, the Government fully acknowledge the valuable contribution of the voluntary sector and other organisations in this matter. There have recently been remarkable breakthroughs in research and techniques to help sufferers, but the department assists voluntary sector organisations by making grants available for this research.
Lord Elwyn-Jones: My Lords, perhaps I should have declared an interest in that I am president of the Mental Health Foundation.
Lord Mottistone: My Lords, is my noble friend aware that I, too, attended the meeting in Oxford to which she referred, for its morning session? Is she also aware that when one of the speakers said that before people are discharged from hospital it must be ensured that there are adequate facilities for receiving them into the community, particularly when their families cannot take them, this received prolonged clapping? I understand that this might mean further legislation. Would my noble friend give consideration to such legislation being introduced?
Baroness Hooper: My Lords, I am most grateful to my noble friend for giving us a hot-from-the-scene report on the conference taking place in Oxford today. The subject of legislation has been raised on many occasions, and not least, as I said before, in the debate in your Lordships' House in December. It has been suggested that legislation is required, but the Government feel that legislation itself could not conceivably solve all problems and they are taking time and care not to rush into further legislation without the most careful thought.
Lord Mayhew: My Lords, does the noble Baroness agree that, whereas this is a profoundly worrying situation, there has, at least in the last 10 or 20 years, been a considerable increase in public sympathy and understanding of these mental illnesses?
Baroness Hooper: My Lords, I would certainly agree with the noble Lord, and I thank him for his comment.
Lord Campbell of Croy: My Lords, does my noble friend agree that one of the most useful contributions that Parliamentarians could make would be to refrain from misusing the expressions "schizophrenia" and "schizophrenic" in public debate on other subjects?
Baroness Hooper: My Lords, I agree.
Lord Greenway: My Lords, may I ask the noble Baroness whether the Government will keep an open mind on alternative treatments of schizophrenia, and I refer in particular to diet?
Baroness Hooper: Yes, my Lords, I think I can assure the noble Lord that one of the grants recently made to the voluntary sector is particularly for research into this aspect.

Iran: Smuggling Allegations
2.46 p.m.
Lord McNair: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they can confirm allegations in Forbes Magazine (27th January 1986) that the London office of the Iranian National Oil Company assists in the smuggling of stolen US war material into Iran; and, if this is so, whether it is legal.
The Secretary of State for Employment (Lord Young of Graffham): My Lords, the Government have no evidence on this matter and cannot therefore comment on these allegations. The export of war material from the United Kingdom to all destinations is prohibited unless the exportation is covered by an appropriate licence. Provided that the goods mentioned in the article in Forbes Magazine were neither stolen in nor exported from the United Kingdom, no offences under United Kingdom law would have been committed.
Lord McNair: My Lords, can the noble Lord tell me whether Her Majesty's Government have received representations from the Government of the USA for assistance in preventing the onward transmission to Iran of material illegally acquired in the USA?
Lord Young of Graffham: Yes, my Lords, the Foreign and Commonwealth Office is in close contact with the United States authorities on all aspects of the Iranian-Iraqi conflict, including the supply of defence equipment. These contacts have included discussion on Iranian military procurement activities based in London.
Viscount Buckmaster: My Lords, in view of the difficulty in detecting much of this smuggled equipment, have the Government plans for the further training of Customs officials in this field?
Lord Young of Graffham: My Lords, this is a matter where we have no evidence at the moment, and therefore we shall be looking to see where we can acquire some.
Lord Williams of Elvel: My Lords, is there not also a separate problem in that the Iranian National Oil Company is established in this country as a trader in hydrocarbon products? If the offices of this company are being used for other purposes, then the declarations that are made to the Inland Revenue in that respect may well be false. Would the noble Lord therefore agree that the Inland Revenue itself has powers under the Income and Corporation Taxes Act 1970 to investigate this company, particularly in respect of business expenses, if that activity is being carried on?
Lord Young of Graffham: Yes, my Lords; but I would wish to assure the noble Lord, Lord Williams, and your Lordships' House, that we have no evidence of any involvement of the Iranian National Oil Company in this activity.
Lord Mayhew: My Lords, when the noble Lord says that the Government have no evidence, does that mean that the Government have made no inquiries of this firm?
Lord Young of Graffham: My Lords, I think in all the circumstances that it would be better to say that the Government have no evidence in the matter and therefore cannot comment further. Whether or not inquiries have been made, and the outlook on those inquiries, are not matters that I think we should raise in this way.

Nuclear Weapon Tests: Soviet Proposal
2.49 p.m.
Lord Brockway: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what action they propose to take in response to the moratorium on all nuclear weapon tests unilaterally declared by General Secretary Gorbachev of the Soviet Union until 31st March 1986.
The Minister of State for Defence Support (Lord Trefgarne): My Lords, we have made clear on numerous occasions that declaratory gestures of this type have no real value in arms control terms. We remain committed towards achieving balanced, verifiable arms control agreements which contribute to British security. In particular, we remain committed to seeking progress towards a comprehensive test ban treaty.
Lord Brockway: My Lords, I thank the Minister for that Answer. May I ask him whether he has noted President Reagan's invitation to Soviet scientists to witness a nuclear detection system and to monitor an underground test in Nevada? Does this not indicate that one of his reasons for not signing the comprehensive ban is to carry out further experiments, some of which may be more dangerous? While the Soviet Government may decline the invitation, because they are carrying out unilaterally no underground tests, will the Government do three things: first, press President Reagan to ratify the 1974 and 1976 test ban treaties; secondly, complete the hopeful negotiations on verification; and, thirdly, sign the comprehensive treaty?
Lord Trefgarne: My Lords, if I may take first the first of the noble Lord's supplementary questions, where he referred to the 1974 threshold test ban and the 1976 peaceful nuclear explosion treaties, I understand that the United States wishes to carry out or achieve better verification provisions for those treaties before they can move ahead; and I can well understand its anxiety in that respect. But the United States has indicated that those measures, such as
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proposals for test site observers, are a basis which could work towards an effective verification regime for those treaties. So perhaps the situation is not quite so black as the noble Lord suggested.
Verification remains the key on the signing of a comprehensive test ban treaty. We believe strongly that such a treaty would be without value if it does not have effective verification provisions within it.
Lord Cledwyn of Penrhos: My Lords, while we appear to live in an age of declaratory gestures which are not always helpful, is it not the case that the deputy Soviet Foreign Minister, Mr. Komplektov, recently said that the Soviet Union was prepared to negotiate on site verification and the possibility of a full test ban treaty? Can the noble Lord tell us what steps Her Majesty's Government are taking towards the possibility of talks on those two subjects?
Lord Trefgarne: My Lords, the Soviet Union has indicated that it would be willing under certain conditions, as I understand it, to accept observers of Soviet nuclear tests; but apparently the proposal is tied, in a way which is not entirely clear, to United States prior acceptance of the moratorium. That is a matter with which we should have some difficulty, for reasons which the noble Lord will understand. We have made clear in the past, as I endeavoured to make clear in the main Answer to the Question this afternoon, that declaratory gestures such as the moratorium which the Soviet Union has been proposing are without value while they are not properly verifiable.
Lord Cledwyn of Penrhos: My Lords, with great respect, does the Minister not agree that the moratorium is not a declaratory gesture but a fact which has been taking place for some months? Will the Minister therefore say what steps Her Majesty's Government are now taking to clarify whether or not the moratorium is the condition that he describes it to be?
Lord Trefgarne: My Lords, it is always difficult to get to the bottom of exactly what the Soviet Union is proposing, because it keeps on attaching conditions to whatever is proposed. The fact remains that the United States proposal, to which the noble Lord, Lord Brockway, referred, where President Reagan invited observers to watch an American nuclear test, was without conditions of any kind.
Lord Mayhew: My Lords, will the noble Lord confirm, however, that the unwillingness of the Government to resume negotiations for a comprehensive treaty is due to difficulties of verification and not to the fact that further tests are needed for the Trident project?
Lord Trefgarne: No, my Lords. The Government position on this matter is that we should like to see the verification problems addressed before the negotiations are resumed. We do not think there will be much point in negotiations while these problems loom large and have not been solved.
Lord Jenkins of Putney: My Lords, is the noble Lord aware that to call a unilateral decision to stop testing a declaratory gesture is to murder the English language? In the circumstances, will he not make a similar declaratory gesture, if that is what it is, and decide that this Government too will stop testing? If a unilateral decision to stop testing is a declaratory gesture then a large number of us on this side of the House will welcome it.
Lord Trefgarne: My Lords, I do not think that the limited unilateral and indeed declaratory gesture to which I have referred is any substitute for a long-term durable agreement. That durability will be achieved by resolving the problems, not by sweeping them under the carpet.
Lord Molloy: My Lords, the Minister has quite correctly said that the key to all this seems to be verification acceptable to both sides. Would it not be possible for Her Majesty's Government to consider talking to the United States and to the USSR, to have a conference and a discussion about what they feel might be the first realistic step towards ultimately achieving verification, which would mean so much to all mankind?
Lord Trefgarne: My Lords, what the noble Lord has in mind would be a meeting of technical experts, for example, to address the problems of verification, which are not inconsiderable, and the Government would support that.
Lord Brockway: My Lords, will the Government reconsider their attitude on this issue by an immediate signing of the comprehensive treaty? Is the Minister not aware that all world opinion, except for America, this Government and France, is in favour of the signing of the comprehensive agreement? Will he not respond to world opinion?
Lord Trefgarne: My Lords, there is really no point in entering into an agreement where there is scope for widespread cheating. That must remain the position while it is not possible to verify the effective compliance with such an agreement.

Health Authorities: Appointments
2.57 p.m.
Lord Dean of Beswick: My Lords, I beg leave to ask the Question standing in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what criteria have been used in the appointment or reappointment of health authorities which will take effect in April of this year, how many new appointments have been made, how many reappointments have been made, and whether a comprehensive list of the chairmen and their authorities can be published.
Baroness Hooper: My Lords, I assume that the noble Lord is referring to the appointment of district health authority chairmen which is to date from 1st
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April 1986. In some ways the noble Lord's timing is perfect in that my honourable friend the Minister for Health will be making an announcement of the names later this afternoon. I cannot therefore comment in detail, but I can assure the noble Lord that in making such appointments we take into account a wide variety of factors. The most important are the candidates' personal qualities, their interest in and commitment to the National Health Service, their management or other relevant experience and the need for fresh ideas.
Lord Dean of Beswick: My Lords, I am grateful to the noble Baroness for that Answer and for the fact that the information will be made available today. But is she aware that there is great concern in West Leeds because of the removal of Mr. Robin Wood, the chairman of the health authority in whose area I reside? I understand that Mr. Wood is a supporter of the Government. The only quality he does not seem to have is to be a "yes man" for the chairman of the regional authority. Is the Minister aware that a delegation of all the consultants in West Leeds based on the Leeds General Infirmary, which is one of the largest teaching hospitals we have, saw the chairman of the regional health authority to seek support for the reappointment of Mr. Wood? The chairman made an explicit statement in which he said, I understand, that he would not be prepared to support that. Can the Minister tell us whether we are now in the ball game of people like the chairman of the Yorkshire Regional Health Authority being able to pick his own team?
Baroness Hooper: My Lords, the noble Lord will appreciate that it would not be proper for me to comment on individual appointments in view of the Statement to be made in another place shortly. However, in view of press comments and the general concern which has arisen in Mr. Wood's case, I should say that it is unfair to imply that an individual has been sacked when the statutory term of his appointment has come to an end.
The noble Lord will appreciate that in making appointments we find it important to bring in new people to provide fresh insights into the service, as well as to reappoint existing chairmen. The decision taken not to reappoint some chairmen in no way reflects on them personally or on the genuine and valuable service that they have given over the past four years.
Lord Ennals: My Lords, will the noble Baroness accept that we shall study very carefully the list when it is published? Is she aware that there is a widespread view throughout the country that membership of the Government party is a very important consideration when choosing authority chairmen? Is it not wrong that authority chairmen who have criticised government policy or regional policy should in any way be excluded from reappointment? As the noble Baroness herself rightly said, is it not the commitment of the persons concerned to the National Health Service, their competence and their skill, regardless of any political considerations, which should govern who should be appointed?
Baroness Hooper: My Lords, indeed, chairmen of health authorities are appointed for their personal qualities and not to represent any sectional or particu

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lar interest. While we may be aware of political affiliations in some cases, we do not seek that information and neither is it the basis on which we select chairmen.
Lord Cledwyn of Penrhos: My Lords, will the noble Baroness deal with the point that my noble friend has made about the additional political qualification which is not on the list that she read out to the House? To what extent is it true that nominations of this kind are vetted by the Conservative Party Central Office, as was reported in one newspaper? Is there any truth in that? Is she aware that the House would take it very amiss, as would the country, if party political qualifications should be in any sense a qualification for this important post?
Baroness Hooper: My Lords, I am sure that the noble Lord, like many of your Lordships, does not believe everything that he reads in the press. In fact, in the case of these appointments the Secretary of State is not required to consult anyone. He did, however, take account of nominations and views from various sources, including those from Members of Parliament of all parties, national and local organisations and various individuals.
Baroness Fisher of Rednal: My Lords, will the noble Baroness inform us whether any women have been included among the list of chairmen who have been appointed?
Baroness Hooper: My Lords, I am afraid the noble Baroness will have to wait until the announcement is made in another place very soon.
Lord Cledwyn of Penrhos: My Lords, may I therefore assume that the noble Baroness is now giving a categorical denial that these party political qualifications are taken into account?
Baroness Hooper: My Lords, yes. Political qualifications do not count in these appointments.
Lord Dean of Beswick: My Lords, is the Minister aware that I am grateful for the remarks that she made when she said that those who have been removed have not been sacked but have been stood down, even though some of them have done only one term? Some of us find it strange that certain people have been reappointed. It is not the regional chairman's turn for appointment, but he has obviously had an influence on the three who have been removed in West Yorkshire. He and the chairman of a neighbouring authority, who were bitterly criticised in the report on the deaths at Stanley Royd of 17 or 19 old people through salmonella poisoning, appear to have been reappointed. What really is the standard that the Government apply?
Baroness Hooper: My Lords, I cannot comment on individual cases but I can say that the views of regional health authority chairmen are clearly important in this context.

Glorious Revolution and Bill of Rights: Tercentenary Celebrations
3.3 p.m.
The Lord Chancellor (Lord Hailsham of Saint Marylebone): My Lords, with the leave of the House I should like to make a Statement on the arrangements for celebrating the tercentenary of the Glorious Revolution and the Bill of Rights.
In 1988 we will be celebrating the tercentenary of the Glorious (or Bloodless) Revolution and the Bill of Rights. These were the foundations from which evolved, peacefully, the system of parliamentary democracy under a constitutional Monarch which we enjoy today, and which has inspired the constitutions of many other countries of the world. Parliament itself will wish to take a lead with an appropriate celebration to mark this anniversary. Mr. Speaker and I are therefore appointing today a small committee of Members of both Houses to advise us on the form of these celebrations, and to oversee the arrangements to be made.
I am also happy to tell your Lordships that the Prime Minister and the Leaders of other parties have indicated their full support for these proposals, and have agreed to become patrons of this project.
The following noble Lords who are Members of this House have kindly agreed to serve on the advisory committee: the noble Lords, Lord Blake and Lord Crawshaw of Aintree; the noble and learned Lord, Lord Elwyn-Jones. PC; and the noble Lords, Lord Henderson of Brompton and Lord Thomas of Swynnerton. A Clerk from each House will serve the committee.
My Lords, that concludes my Statement.

Consolidated Fund (No. 2) Bill
3.5 p.m.
Lord Denham: My Lords, on behalf of my noble friend the Lord President of the Council, I beg to move the first Motion standing in his name on the Order Paper.
Moved, That Standing Order 44 (No two stages of a bill to be taken on one day) be dispensed with for the purpose of taking the Consolidated Fund (No. 2) Bill through its remaining stages this day.—(Lord Denham.):
On Question, Motion agreed to.

Business of the House: Debates 18th March
Lord Denham: My Lords, again on behalf of my noble friend the Lord President of the Council, I beg to move the second Motion standing in his name on the Order Paper.
Moved, That Standing Order 38 (Arrangement of the Order Paper) be dispensed with to enable the four Motions standing in the name of the Lord Elwyn-Jones to be taken before the Second Reading of the Housing (Scotland) Bill on Tuesday next.—(Lord Denham.):
On Question, Motion agreed to.

Consolidated Fund (No. 2) Bill
Read a second time; Committee negatived.
Then, Standing Order No. 44 having been dispensed with (pursuant to Resolution), Bill read a third time, and passed.

Museum of London Bill
Read a third time, and passed and returned to the Commons with an amendment.

Latent Damage Bill [H.L.]
3.8 p.m.
The Lord Chancellor: My Lords, I rise to move that this Bill be now read a second time.
The object of this Bill is to put into effect the recommendations of the 24th Report of the Law Reform Committee on a reference I made earlier in my present term of office on the subject of the limitation of actions for negligence in cases where the damage alleged to have been caused by negligence is not obvious and only appears long after the breach of duty has taken place. I made the reference in August 1980. The committee chaired by my noble and learned friend Lord Scarman reported in November 1984 and I have only now been able to obtain a slot for it in the Government's programme. The Bill is only five clauses and six pages long. It therefore ranks as a short Bill; but if, as I hope, it finds its way on to the statute book it will effect an important and valuable change in the limitation law as it affects the tort of negligence.
The necessity for the reference to the Law Reform Committee arose out of a series of court decisions which I need not enumerate seriatim. The tort of negligence arises when damage occurs as the result of a negligent act or omission in breach of an existing duty of care. A breach of duty by itself is not enough to give rise to the cause of action. The right of action arises only when the breach results in actual damage. The ordinary limitation period for actions for damages for negligence, apart from the numerous cases of personal injury (with which the Bill is not concerned) is the ordinary period of six years. In most cases this is perfectly adequate since in most cases the damage is obvious from the first. My Lords, if I run into your canoe in the Thames or negligently knock over a pile of plates in your restaurant or negligently set fire to your house, you have only yourself to blame if you let six years pass without issuing a writ. But sometimes damage occurs which is not easily or reasonably discoverable till after the six-year period has already passed. It may be that I am an architect or builder who has faultily designed or constructed the foundations of your house or a surveyor who failed to discover under the plaster. It may be that I am a solicitor or an under the plaster. It may be that I am a solicitor or an accountant who has advised incautiously or drawn a document in a way which for some time does not come to light. There is a whole range of cases and relationships to which such considerations may apply. What happens then, my Lords? The case to which I have referred establish, first, that the cause of action does not arise and therefore the six-year period does
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not begin to run on the breach of duty before damage has actually occurred; secondly, that the time does begin to run when damage has occurred even though it is not reasonably discoverable; and, thirdly, the principle of discoverability does not therefore apply to the limitation period. The reference therefore to the committee covered a very limited field. It covered the accrual of the cause of action; it covered the desirable limitation of the cause of action; and though it excluded latent disease or personal injuries it included a wide range of occupational relationships: builders, architects, solicitors, accountants and many others. It also covered the case where the victim of the damage was a third party—for instance, the purchaser of the house, or, in the case of a will drawn by a solicitor during a prospective testator's lifetime, an intended beneficiary. These are all persons other than the person to whom the original duty of care was owed.
There are really two classes of person whose interests are affected in this area of the law, apart from the third parties; the potential plaintiff (or alleged victim of the negligence) and the potential defendant (or alleged tortfeasor). They are both equally important. But there is this difference between them. In the main the potential defendants are well represented by professional associations of one kind or another who are extremely articulate, extremely competent and very well advised. The potential plaintiffs, however, do not constitute an identifiable class, since at any given point of time, ex hypothesi, they are unknown and, since they cannot be identified, cannot be represented and have no articulate voice at all.
The committee found that the present law did an injustice to both classes: to the potential plaintiffs, because owing to the irrelevance of the principle of discoverability the limitation period might elapse before they could reasonably be aware that they, had a right of action; and to the potential defendants because the right of action might arise so long after the negligent act or omission that they are unable to assemble adequate evidence to contest a claim, and might find it impossible or at any rate difficult to insure against it. In addition, under the existing law third party victims, as when a house is sold to a third party after damage has occurred and the action has accrued, can remain uncompensated, and in any case where the limitation period is in question the courts themselves are required to perform in every case the time-consuming, expensive and sometimes impossible task of ascertaining exactly when damage began to occur. It was to remedy these defects in the law that the committee recommended changes and now this Bill embodies their recommendations.
Following the committee, the design of the Bill follows three principles. The first principle was that plaintiffs must have a fair and sufficient opportunity of pursuing their remedy. The second principle was that defendants are entitled to be protected against stale claims. The third principle was that uncertainty in the law is to be avoided wherever possible.
These principles resulted in two major recommendations: first, that the ordinary period of limitation of six years should be subject to an extension which would allow the plaintiff a further three years from the date on which he discovered, or could reasonably have

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discovered, that he had suffered significant damage; but, secondly, that there should be a long stop provision which should operate to bar all negligence claims, however well founded, involving latent defects or damage that are brought more than 15 years from the date of the defendant's breach of duty. These recommendations are embodied in the Bill.
I must say a word about the contents of the Bill and scope for discussion. In the first place, I must emphasise that the Bill, based on the Law Reform Committee recommendations, is a highly balanced document based on the widest consultation, with over 140 entities listed in the appendix to the report. It endeavours to do justice both to the inarticulate, unorganised and unidentified potential plaintiff and to the highly articulate, well organised and easily identifiable potential defendant. Both gain by the Bill, I believe. In the second place, although it does not deal with insurance (which is the subject of an entirely separate consultation document issued in 1985 by the National Economic Development Office), nor with insurability, the long stop provisions which are for the benefit of potential defendants should ease their insurance problems. In the third place, both the Bill and the report on which it is based contain certain further provisions, which I will now enumerate seriatim.
First, the Bill deliberately makes no change in the general rule of substantive law whereby a cause of action in negligence accrues at the date on which the resulting damage occurs. The report deals with that at length. Secondly, the Bill provides that a person under disability (for instance, minority or unsoundness of mind) at the date of discoverability is given an extension to cover the unexpired portion of his disability. Thirdly, the Bill ensures that fraud, deliberate concealment or mistake are not protected by the long stop. Fourthly, the Bill provides that unlike the date of the accrual of the cause of action, the long stop period runs from the date of the breach of duty and not from the occurrence of damage. That is of course beneficial to potential defendants.
A suggestion was made to your Lordships in the course of a short debate a few weeks ago on the Unstarred Question by the noble Lord, Lord Hacking, that the long stop period should run from the date of completion. That suggestion was deliberately rejected by the committee, particularly on the grounds, first, that it is applicable only to a narrow segment of the potential litigants in the causes of action concerned—for example, the construction industry—and, secondly, on the ground of the difficulty, even in relation to the construction industry, of defining completion so as to avoid injustice especially to defendants responsible for very large projects. Completion is a contractual concept, essentially difficult to apply, and perhaps wholly inapplicable to the law of tort. Furthermore, on consultation the suggestion was firmly rejected by the official referees who are perhaps the specialists best qualified to referee this decision.
Clause 3 enables successors in title to the original victim to inherit the original cause of action. This continues to be effective only within the original limitation period, and subject to the long stop.
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I ought to say a word about the drafting of the first two clauses which at first sight might seem a little clumsy. As the House will remember, we consolidated the Limitation Acts, which by that time were becoming a little complex, in 1980. We do not wish to lose the advantage of that consolidation in 1986. We have therefore drafted Clauses 1 and 2 of the Bill in such a form as to read as textual additions to the consolidation Act in the form of a new Section 14A (the discoverability addition) and 14B (the long stop addition). Clause 2 of the Bill, which is consequential on Clause 1, adds a new Section 28A to the consolidation Act. Subsection (1) of that new clause gives the additional protection to those who are under a disability at the time of discoverability. Subsection (2) removes the long stop protection from a defendant guilty of deliberate concealment. I have described the effects of these provisions earlier in my exposition of the policy.
I think that Clauses 4 and 5 speak for themselves, and I will therefore add nothing. My Lords, I beg to move.
Moved, That the Bill be now read a second time.—(The Lord Chancellor.)
3.23 p.m.
Lord Silkin of Dulwich: My Lords, may I begin by thanking the noble and learned Lord the Lord Chancellor for his clear exposition of a Bill on a highly complex subject? In doing so, perhaps I may also be permitted to express my thanks and, I am sure, those of the House for the clear and interesting report of the Law Reform Committee upon which the Bill is based.
There is little that I can usefully add to what the noble and learned Lord the Lord Chancellor said, more particularly perhaps because we had a short debate on the Unstarred Question asked by the noble Lord, Lord Hacking, a few weeks ago, to which the noble and learned Lord referred. The issues raised by the Bill were thoroughly canvassed then.
However, there is one matter which I raised on that occasion to which I should like to return and with which I do not think the noble and learned Lord dealt when he answered the point raised by the noble Lord, Lord Hacking, either then or on this occasion. As the noble and learned Lord said, the Law Reform Committee put forward three principles which it sought to reconcile. They are not principles with which I would wish to quarrel. The first is that the plaintiff must have a fair and sufficient opportunity to pursue his remedy. In that context, perhaps I may draw particular attention to what the noble and learned Lord said a moment ago when he repeated what he said on the earlier occasion; that plaintiffs in such an action, particularly those which relate to defects in buildings, are unlikely to be assisted by the organisation or even the articulateness which defendants probably enjoy, so that when one considers what is a fair and sufficient opportunity one must bear that point in mind. The second principle is that a defendant is entitled to be protected against stale claims. The third is to avoid uncertainty wherever possible.
Of course, the difficulty which the committee had to resolve was how to reconcile those three principles

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which, particularly in cases related to buildings, are not always easy to reconcile. It may well be that the defect which causes loss and damage to the plaintiff is one of which he did not become aware and, indeed, of which he could not have become aware until many years have elapsed. I speak with a certain amount of personal experience inasmuch as settlement occurred to the house that I occupy which was not noticeable until some 25 years or more after it had been built. It certainly could not have been known about before then.
The plaintiff or the house owner may be put in a very difficult position as a result of the existing law, and the report and the Bill go some way towards dealing with that. The ideal situation would be to remove altogether the possibility that a plaintiff is debarred from suing upon something about which he neither knew nor possibly could have known. To achieve that ideal is extremely difficult without extending the limitation period so long as to be totally unfair to the defendant. It is fair to say in that context that the builder or the architect, if he keeps proper records, would normally be in a very much better position to defend himself against an accusation of negligence than would the plaintiff who may not even have been the first purchaser of the house if the defect does not appear for a substantial period of time.
The plaintiff in such circumstances will probably have to rely upon the advice of an engineer or other expert at the time when eventually the defect appears. As I know from my experience, it was not until extensive and expensive excavations had taken place that it was possible for me to be advised as to whether the settlement was due to any fault on the part of the builder or not. That is a situation which is likely to be repeated. It is in that context that I raise the only point on this Bill and on the report which has worried me; and that is the period, which is not subject to any change in any circumstances, of 15 years as the long stop period. As I have mentioned, in my own case it was 25 years before the defect became apparent, and though, fortunately, I was able to put the cost upon an insurance company, that will not always be the case and the costs of putting right that kind of defect can be quite frightening.
The question which has worried me in reading the report of the Law Reform Committee is whether it would be desirable and possible to give to the court some elasticity in the application of the long stop period. This matter was raised before the committee, which somewhat summarily rejected it on the basis that a long stop ceases to be a long stop if there is any uncertainty at all about its length.
I wonder whether that was a sound reply and whether it would be practicable—I am not seeking at this stage to think in terms of drafting—to give to the court some power to vary, obviously within fairly close limits, the 15-year period in favour of the plaintiff where it appears to the court on the facts before it, first, that it would not involve unreasonable hardship on the defendant; and, secondly, that in the circumstances of the case it would cause hardship to the plaintiff, particularly when he neither knew nor could possibly have known of the defect and the damage, and where, as soon as he did know, he took immediate action to bring the matter before the court. The courts have
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powers in other fields to vary limitation periods and I should have hoped that it might be possible to devise a satisfactory way of doing that in the sort of case to which I have referred.
Apart from that one difficulty on which I have doubts, and which I recognise is a matter of the balance to which the noble and learned Lord the Lord Chancellor referred—and I fully understand that those who represent the builders, the architects and those concerned with the erection of a building may prefer the balance to be on one side, while the householder may prefer it to be on the other—it seems to me that this is an extremely valuable Bill and I commend it to the House.
3.34 p.m.
Lord Mais: My Lords, I feel hardly qualified to rise and speak on this occasion in company with such an abundance of legal talent, but I can assure your Lordships that I shall at least be brief. There are many points in this Bill which required attention, but the one which has bothered me most, and I think it has bothered most people connected with the construction industry, whether on the professional side or on the industrial side, is the period of 15 years.
It is only recently that the subject of latent damage has been dealt with and I think we are all very grateful to the noble and learned Lord, Lord Scarman, for his report, which certainly clarifies the position both from the professional point of view and from the point of view of those who go their way in industry. I have been in the construction industry for the best part of 50 years and the fear of latent damage arising has always been with both the professions and the contractors who carry out the work. For the professions it is a very serious matter indeed, because, unlike the contracting element, they are entirely dependent upon the amount of insurance that they carry and it is not always possible to cover for the amount of damages that might be levelled against them.
The question of latent damage claims is worse now and much more prevalent than it used to be when I first started in the industry. Then there was a certain amount of covering up and people said, "We mustn't bring a case like this, because it will cause unnecessary suffering." But now people think of looking for the possibility of making a claim before a job has even started! In fact, I have come across cases where contract documents are handed over to the legal side of a company to see whether there are any loopholes in those documents which will support a claim at a later date.
When one is thinking about the unfortunate person who is on the receiving end of late contracts, and contracts completed several years after they were told, one should also bear in mind the problems of architects, engineers and contractors. With labour conditions as they are, and with the unknown problems which one may face on any contract, particularly if it is a big one and it is abroad, people need to have some protection.
There is no particular point to which I object in the Bill. In fact, it is a good Bill so far as the industry is concerned. The only point that I wish to raise is the period of 15 years from the breach of duty. That

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problem could arise at a stage in the contract which meant, ultimately, that it would be not 15 years but 20 or even 23 years. It could mean severe financial disaster for some people. If it is possible at this late stage, I suggest that the Bill should be amended so that the period will be "the completion of the contract" plus 10 years. That would be much more reasonable and acceptable so far as the industry is concerned, and certainly so far as the professions are concerned. It would also have the advantage of being in accordance with the Continental procedure. I have no other point to raise. It is a Bill which is welcome, so far as the industry with which I have been connected is concerned. There is just the one point which worries us considerably, and I would only ask whether at this late stage it could be looked at again.
3.40 p.m.
Lord Hacking: My Lords, in rising to make his comments to your Lordships' House the noble Lord, Lord Mais, spoke of some diffidence at speaking among so many lawyers. I am one of those lawyers but I also speak with diffidence for I have nothing like the detailed knowledge and experience of the noble Lord, Lord Mais, and other noble Lords in the construction and other industries that are affected by the provisions set out in this proposed legislation. I hope that other non-lawyer Members of your Lordships' House, whether they are representing the articulate or inarticulate and whether they are concerned about the interests of plaintiffs or defendants, will participate in this debate.
In beginning my comments, I should like to express again thanks to the noble and learned Lord the Lord Chancellor for the enormous time and trouble that he and his officials have taken in the extensive consultations that have taken place prior to the Bill being put before your Lordships' House. I shall not name the officials of the noble and learned Lord but I am glad to see that they are in attendance in the House and I state again my personal indebtedness to the noble and learned Lord and to his officials for the time and trouble they took over these consultations.
I welcome this Bill for several reasons. First of all, I welcome it because it produces justice for plaintiffs, whether inarticulate or articulate. It is some time now since the law came to the rescue of the plaintiff with latent injury. That arose after the troubling case in 1963, if my memory is correct, of Cartledge v. Jopling. The plaintiffs were held in that action to be statute barred even though they did not know about their latent injuries which in that case was pneumoconiosis. The Houses of Parliament came quickly to their rescue in—again if my memory is correct—the Limitation Act 1963. It is therefore clearly right and appropriate that the law should come to the rescue of, and do fairness to, plaintiffs who have suffered from latent damage and who have been statute barred long before they knew of their damage.
I also welcome the Bill on behalf of defendants because it does fairness to them. They should not be exposed to stale actions when so much time has passed that they are put at a severe disadvantage in defending the plaintiff's claim against them. I also welcome the
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Bill because it goes some way, although I hope to persuade your Lordships that the Bill should go further on this route, to establish greater clarity and certainty in the law relating to limitations of actions and particularly relating to latent damage.
The present law has not been in a satisfactory state for some time. For that reason I much welcome these measures but I am sorry, though, that the Government have not yet been persuaded—in bringing these measures before your Lordships—to deal with the five different accrual points for the period of limitations upon which I addressed your Lordships in the Unstarred Question in February. I hope nonetheless that the noble and learned Lord will give further and fresh consideration to this problem to which I intend to return at the Committee stage. I presented the argument as best I could in the Unstarred Question and I shall at this stage leave that argument as it rested there.
The noble and learned Lord has referred—and I have repeated the words—to the "articulate" and the "inarticulate" in his concern that the inarticulate plaintiffs interest should be protected, and protected within the framework of this legislation. I think it would be right, although I in no way defer from this concern of the noble and learned Lord, to draw your Lordships' attention to other persons who are potential plaintiffs who are far from inarticulate. I refer to large property companies and to large local councils and I refer to the Consumers' Association, which sent to me (and I suspect to other noble Lords) a letter which was highly articulate and represented the concern of potential plaintiffs. In truth, defendants and plaintiffs each have their special problems and that is why I welcome the Bill.
I should like now to turn to some special points concerning this proposed legislation and to address a few comments upon them. I turn first of all to the activating event for the long stop period. In new Section 14B of the 1980 Act it is proposed that that activating date should be, in effect, the date of breach of duty. The difficulty is that it covers so many wide, diverse activities. It covers the building of buildings to the making of products and indeed, as the noble and learned Lord mentioned, solicitor negligence. Therefore this test of breach of duty, while it covers all those differing activities, still presents some difficulty in ascertaining the accrual point. I do not think it was me in the debate that I introduced in February who argued that we should settle on "completion date". This is a matter which has been extensively discussed among those in the construction industry—among those members who are truly concerned for clarity of the law and not to get an advantage for their own interests.
It has been suggested—and I hope to deal with this in Committee—that some compromise may be reached about the accrual date for the long stop period in terms which would fairly bring the completion date as one of the starting points for the accrual point of the long stop period. I merely put before your Lordships what I believe to be the difficulty, which is to find a phrase which covers such wide and diverse activities from the building of buildings to the making of products or to the provision of services.

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I turn next to the period of the long stop. In fixing this period it is clear that different persons have different interests. It spans (does it not?) a 10-year period to a 12-year period, to a 15-year period to a 20-year period. At this stage I shall not advocate before your Lordships any particular period. I just reflect that the time that has been chosen in the Bill is clearly a middle period. It is also the period that the noble and learned Lord, Lord Scarman, and the fellow members of his committee recommended in their report. It has a sense of fairness in the sense of being middle ground.
All I make is the general observation that the plaintiff is not being served by too long a long stop period. He is not being served because it is the plaintiff who is also put to disadvantage by stale litigation. He is not being served because too long a period means that he may no longer be able to find his defendant or, more seriously, no longer able to find his defendant with means to pay damages because, for example, that defendant is no longer covered by insurance. Thus it is not in the interests of the plaintiff to go for too long a period. Indeed, it is in the interest of both the plaintiff and the defendant that there should be an alertness to the need to get on with the action and—more than that—an alertness about the need to be sure that the products you are receiving into your possession—whether it be a house or another product—are carefully examined so that you are not caught by latent damage and, worse still, caught by the 15-year period.
I turn now to another point in the Bill. It is set out in the proposed Section 14A and subsections (5), (6), (7) and (9). The noble and learned Lord explained how those subsections came to be drafted into the Bill. He referred to them in his most helpful speech to your Lordships in explaining the Bill as "textual additions" to the Consolidated Limitation Act 1980. In my humble submission that is precisely the difficulty about those provisions. They are indeed largely, although not exclusively, taken from Section 14 of the 1980 Act, as the test of knowledge for plaintiffs who have suffered personal injuries.
I should like to refer to this matter in a little more detail because it is my submission that those tests are not appropriate for latent damage cases. It is my submission also that, to coin a phrase used by the noble and learned Lord, these provisions are "too cumbersome".
The new section involves a series of tests, and I shall read from the text of subsection (5):
"For the purposes of this section, the starting date for reckoning the period of limitation under subsection (4)(b) above is the earliest date on which any potential plaintiff first had knowledge both—

(a) of the material facts about the damage in respect of which damages are claimed; and

(b) of the other facts relevant to the current action mentioned in subsection (7) below".

Leading from those two initial tests, we go on to the actual tests for putting into effect subsection (5)(a). I refer to subsection (6), where we find these words:
"For the purposes of subsection (5)(a) above, the material facts about the damage are such facts about the damage as would lead a reasonable person who had suffered such damage to consider it sufficiently serious to justify his instituting proceedings for damages
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against a defendant who did not dispute liability and was able to satisfy a judgment."
That is not the end of the matter because the clause goes on to elaborate upon the test in subsection (5)(b). Subsection (7) states:
"The other facts referred to in subsection (5)(b) above are—

(a) that the damage was attributable in whole or in part to the act or omission which is alleged to constitute negligence; and

(b) the identity of the defendant; and

(c) if it is alleged that the act or omission was that of a person other than the defendant, the identity of that person and the additional facts supporting the bringing of an action against the defendant".

Your Lordships might think that that is a big enough mouthful, but the clause goes further because it is again picking up "textually" Section 14 of the 1980 Act. Thus it is proposed that the "knowledge" test is now applied.
Subsection (9) states:
"For the purposes of this section a person's knowledge includes knowledge which he might reasonably have been expected to acquire—

(a) from facts observable or ascertainable by him; or

(b) from facts ascertainable by him with the help of appropriate expert advice which it is reasonable for him to seek":

and that subsection goes on to describe yet another caveat with which I need not trouble your Lordships.
The sum total of all of this is, with great respect to the noble and learned Lord, that—to adopt again his own phrase—the clause is extremely "cumbersome". Indeed, if one refers to the very adequate Explanatory Memorandum on the face of the Bill, one finds it is all contained within half a sentence and within lines that number no more than two. In describing Section 14A, the Explanatory Memorandum states:
"It prevents bringing such actions after 6 years from the date on which the cause of action accrued"
and these are the critical words—
"or 3 years from the date on which the plaintiff knew or ought to have known facts about the damage, whichever is the later".
That puts the proposition with at least greater clarity—if not with sufficient precision for the text of the Bill—without the cumbersome use of all these tests, which I have put before your Lordships.
Another point of worry that I should like to draw to your Lordships' attention concerns the general extension of Section 32 of the 1980 Act as it is intended to refer to the proposed revisions. The general proposition in Section 32 is that the period of limitation shall not run when there has been fraud, concealment or mistake. In those circumstances, the plaintiff—within certain procedures that I shall not detail to your Lordships—is still entitled to bring his action, albeit that he is out of the six-year time frame. The inclusion of the word "mistake", which is a technical term well known to lawyers, produces some degree of uncertainty, and that is another matter that causes me concern.
I have one other small observation to make before returning to my general welcome for this Bill. The Explanatory Memorandum includes a note that states:
"There are no EC implications".
Unless I have misunderstood it, I take it that that means there are no EEC implications. I am a little concerned about this proposition because there is a Council Directive of 25th July 1985 that I know is well

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known to the noble and learned Lord the Lord Chancellor and to his officials. With respect, I believe that that Directive has a direct bearing on the provisions in the Bill. I shall not go into detail but I will return to that point, and the importance of it when considering the long stop period, when we reach the Committee stage.
Those are the observations that I have for your Lordships' House on the proposed measures in the Bill. I end as I began, by giving the Bill's provisions a general welcome; but I also end by urging that your Lordships should, when in Committee, show a flexibility that I hope will be shared by the noble and learned Lord so that we may make a reasonable Bill a much better Bill.
3.56 p.m.
Lord Kimball: My Lords, it is with some trepidation, as one who is not versed in the law, that I dare to enter into this debate. My only reason for so doing is that for the past two and half years I have been joint chairman of Lloyd's of London's law reform committee. We have been negotiating with the department on this particular Bill and on the long stop provisions especially. In any negotiations with a government department, the more that one has to negotiate, more often than not one gets let down by it. It is fair to say that my understanding of the position of the negotiations as we finished them was exactly that as summarised by the noble Lord, Lord Hacking, who has just spoken; namely, that the long stop provision would run for 10 years from the date of completion of a building. That is a very acceptable arrangement and one equally proposed by the noble Lord, Lord Mais.
The 10-year long stop provision would be in line with the EC directive under Article 11 on product liability, which states that product liability must run for a 10-year period. The 10-year long stop provision would also have the merit of avoiding the criticism that was in the 24th report of the Law Reform Committee, when it criticised the Scottish 20-year period of extended liability. It criticised that provision on the ground that it led to,
"stale claims and defendants risking litigation over an unreasonable length of time".
I submit to your Lordships that the 10-year long stop period would meet that particular objection.
After all, the longer one waits over a claim, the more difficult it is to prove the fact. Surely the consumers are best served by ensuring that architects, quantity surveyors and civil engineers are all covered by soundly-based policies against claims for latent damage. The position in the market is that those very quantity surveyors, architects and civil engineers are now finding it an extremely difficult market in which to obtain proper insurance provision. Premiums are galloping away at the moment. The Institute of Civil Engineers is currently finding it impossible to obtain building inspectors, who are not prepared to take the jobs simply because they cannot afford to take out the necessary insurance to cover themselves. I hope that when we reach the Committee stage of this Bill we will look very carefully at the whole question of the long stop provision for latent damage.
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Your Lordships will be aware that there are many small states in America where distinguished doctors, surgeons and other professional people simply cannot practise today because they are unable to obtain the necessary insurance cover. It always frightens me when the courts and the law see an insurance company and a claim. It is rather like a pack of hounds when they see their fox. The lawyers' tongues hang out and their wigs flow behind them as they brandish their sticks and pursue the wretched insurance company and the wretched underwriter to a point where they can no longer carry on in business. I am quite certain that that is a situation we wish to avoid. I hope that eventually, during the course of the Committee stage, we shall agree to limit the latent damage provision to a 10-year period.
4 p.m.
Lord Denning: My Lords, I too welcome this Bill and also thank the noble and learned Lord, Lord Scarman, and his committee for a well-reasoned and convincing report. As I have been concerned in many of the law cases that were under consideration, perhaps I may be permitted to explain to your Lordships that the primary object of this Bill, as I understand it, is to deal with latent defects in buildings.
We had two or three cases, the leading one of which was Sparham-Souter in 1976. A house had been built on rubbishy foundations. A little damage was noticed from time to time, but it was over six years before the cracks became very bad in the house, and so the householder looked to see who he could sue because it was discovered that the foundations had been laid on a rubbishy base. The builder had gone into liquidation, so the householder sued, if you please, the inspector of the local authority for having passed the foundations when he ought not to have done. It was seven years or more since the house had been built. It looked as though his claim would be defeated by the six-year limitation. However, in the Court of Appeal, after much consideration, we held that the time did not run against him until he knew of the defects or, with reasonable care, ought to have known. Therefore, he won his case.
The next case in the House of Lords was similar, that of Anns v. Merton. There was even a third case which, I stress, again concerned foundations. The owner of the house noticed a few cracks after 10 years. He had them patched up by a jobbing builder, but after another 10 years—that is, 20 years altogether—the house was falling down. Excavations were carried out and it was found that the concrete flooring was only three inches where it ought to have been 10 inches, or whatever it should be. There had been a breach of the building regulations. The local inspector had passed it. The Court of Appeal held that the householder could not reasonably have known of the bad foundation work for 20 years and that his action was good.
Then there came the great case in the House of Lords of Pirelli. This did not concern foundations but dealt with a 160-foot high chimney at Pirelli's works at Southampton. The chimney looked satisfactory when it was built and for a little time. But after, I believe, six years the owners had occasion to send up a steeplejack

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who found that the wrong material had been used in cladding the chimney at the top. Because of that the chimney had cracked and it was only then discovered. I am afraid that the House of Lords said those earlier cases of ours were wrong; that the time of limitation arose from when the cracks first appeared six years before, although no one had seen them, no one had been up the chimney, and no one knew that they were there. But the time ran from the time of the damage.
In that case the House of Lords said that it was time this matter was looked into. The noble and learned Lord the Lord Chancellor appointed this committee as a result of that case. I am glad to see that the fundamental recommendation of the committee is that in cases of latent defect the time should not run against the plaintiff until he knows of the defect or with reasonable diligence could have discovered it. That is a welcome principle which I gladly accept. It protects the individual who has been unorganised, as my noble and learned friend said, whose house falls down after years and he finds that there is a latent defect. Therefore, so far I welcome the Bill.
Another question arises which is almost more important. It could be said to be hardly within the scope of the committee's report. It does not deal with latent defects in building but with negligent advice from an architect or a solicitor which causes no physical damage but only financial loss. One of the most interesting cases recently is where a man made a will to leave something to his sister-in-law, a Mrs. Ross. The solicitor sent the will to the testator to sign and told him to get it witnessed, but to get it witnessed by someone independent. Therefore, the testator had the will witnessed not by Mrs. Ross but by her husband, Mr. Ross. That made the gift fatal and flawed because the Wills Act says that wills must not be witnessed by either a beneficiary or by the spouse of a beneficiary. The solicitor had not told the testator of that. After he died, the poor sister-in-law was done out of her legacy because the solicitor had given the wrong advice about the witnessing of the will.
I am glad to say that in an important judgment the Vice-Chancellor, Sir Robert Megarry, held that the solicitor was liable for that negligence. That was an almost epoch-making decision. But what if that happens 10, 15 or 18 years afterwards; is there to be no remedy?
The committee wondered whether it ought to go into such a matter as the liability of a solicitor giving negligent advice. The committee said:
"we can see no reason in principle why a plaintiff who has, for instance, suffered damages as a result of a negligently drawn lease should be in any worse a position than a plaintiff whose house has defective foundations".
I agree. The committee did not mention it, but it means overruling cases which have stood for over 100 years. For over 100 or 160 years the law said that a solicitor was liable for breach of contract, for his carelessness or for not taking due care, but was not liable in an action for negligence for tort.
That lasted until about 20 years ago. I am afraid we got round that a bit and we held that a solicitor was not liable for breach of contract only but also in tort for negligence. But it is an open question. There was an important long article in volume 100 of the Law
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Quarterly Review a short time ago which said that the House of Lords has not ruled upon that. Is not the solicitor liable only in contract and not in tort? It is therefore an open question. However, the important point I would raise is this. There are two cases, one called Howell v. Young in 1826 and the other called Forster v. Outred in 1985 or 1986, when it was said that so far as a solicitor's negligence is concerned the time runs from when the person acts upon it.
The cases are these. A man goes to a solicitor and says "I want to lend £1,000 on this property. Advise me, is it good security or not?". The solicitor says "yes". After seven, eight, 10 or 15 years, when it comes to realising the security, it turns out that it was bad and the solicitor's advice was bad. The courts have held that in such a case the time runs from the solicitor's initial act. Those cases must, and I hope will, be overruled by this Bill. Regarding solicitors and all those people, the principle should apply not only in regard to latent defects in the making of buildings but also to bad advice by professional men. It is the very important principle of our law that time should run against the man only from when he knows of the defect or damage or ought reasonably to have known of it. That is the general principle.
Perhaps I may say one word about the long stop. I have given some illustrations. Fifteen years would have knocked out the case about which I have already told your Lordships, Dennis v. Charnwood, where the damage was not discovered, or could not be, for 20 years. It would knock out the will case when the solicitor's negligence was not discovered or did not appear for 20 years. Is it to be looked at again? Is there not ground, as my noble and learned friend Lord Silkin said, not for making this long stop absolute but for giving a discretion to the judge in a proper case to extend it, as has been done in the personal injury cases?
With regard to the date of completion so urgently recommended by my noble friends Lord Mais and Lord Kimball, there is a good deal to be said for this. In the Defective Premises Act 1972—that is on contract, not negligence—Parliament has made the time run (I think it is 12 years) from the date of completion, so that it is already on the statute book in regard to defective or bad work from the date of completion. I can well see how the industry—the engineers—would like to see it from the date of completion. I shall say nothing in favour of it, because I should prefer the principles as enunciated and set down in this report.
I raise those small points, but I should like to say this. We ought to make it clear that the negligence we are concerned with here is not only neglect of a common law duty of care but also negligence in breach of a contract to use due care and negligence in breach of building regulations and the like which have to be observed. At the moment the Bill does not deal with those. My noble friend Lord Hacking suggested in the Unstarred Question that we should deal with them. I should have thought that it was a very good idea to make that clear.
Subject to those observations, many of which no doubt would have to be discussed in Committee, I welcome this Bill.
4.15 p.m.
Lord Wilberforce: My Lords, I ask your Lordships' indulgence in order to add one or two words, prompted by the interesting and valuable observations made by noble and "un-learned" Lords who have spoken in this debate. I am referring, if they will allow me the designation, to the noble Lords, Lord Mais and Lord Kimball. I agree that this is a useful Bill and that the report on which it is based is a very valuable report. But I should like to make the point, which I think is inherent in the observations of some of your Lordships too, that the report is based on very narrow and limited terms of reference.
The committee was to consider the accrual of the cause of action and limitation in negligence cases involving latent defects. I treat that, as I think is the reality, as basically referring to building and engineering cases. That is an enormously important area. When we heard the case of Anns in this House some years ago we were told that there were 200 cases of a similar character awaiting that decision. The law reports are full of cases in which it has been discussed, followed, and so on, and not only here. There is a volume of jurisprudence in Canada, the United States, Australia and New Zealand on this very difficult question of latent damage in building cases.
That is the major problem which was being faced by this report and with which this Bill deals. Picturesque cases about the negligent making of wills, and so on, are very interesting, but that is not the main subject with which we are dealing. I think it is a pity that the terms of reference were so narrowly drawn. They prevented the committee, and it says so in its report quite fairly, from considering broader questions of breach of contract, breach of statutory duty and other cases of liability which may arise in this country. But, more important than that—and this is the point to which the noble Lord, Lord Mais, drew attention—they prevented the committee from considering whether there should not be imposed strict liability in these cases, coupled with a short period of limitation. That is what all the Continental laws, to my knowledge, provide for: strict liability with 10-year limitation. It is not only the Continent of Europe; this has gone into Egyptian law, and has been followed therefore in all the Arab states, because it gives a convenient and, on the whole, just way of dealing with these cases. One does not have to prove negligence; one has strict liability.
I therefore agree entirely with what the noble Lord, Lord Mais, said, subject to this. If one is going to cut down the period to 10 years—and there is a lot to be said for that—one must accompany that with the other limb in the case; namely, strict liability and not negligence. This is the trend in the EC. That is what is being recommended in the case of product liability and in relation to this area. We should be going along entirely with the modern trend if we were to do that instead of sticking to our old common law negligence.
I know that there is an inherent, in-built resistance to dispensing with our precious common law of negligence. We love it. Let the juries, if there are still juries, or the judge find it. Prove negligence; there is nothing so fruitful in costs in litigation as having to prove negligence in relation to an act which may have
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taken place five, 10 or 20 years ago, involving the calling of experts, architect against architect, surveyor against surveyor, and so on. Can we not face up to the fact that the beautiful common law of negligence is not a panacea for all evils and come into line with some of these other countries? It is a great pity that the Bill has been drawn on a report which itself was prepared on so narrow a base. However, perhaps it is now too late to do anything about that here.
Coming to the Bill itself, I have one or two observations to make. It does a faithful and good job in carrying out the recommendations of the report. But I should like to draw attention to three points. First, in spite of the terms of the remit, which is to consider the law relating to the accrual of the cause of action, the Bill does not do anything about it at all. The committee's report says that it does not recommend any change in the law by which a cause of action accrues when damage occurs. But Clause 1 of the Bill simply refers to accrual of the cause of action without telling us when the cause of action is to be deemed to accrue. That is followed up in the new Section 14A(1) in Clause 1, which says: "the date on which the cause of action accrued". In subsection (4)(a) it says: "six years from the date on which the cause of action accrued". Then one goes on and adds the additional periods based on the discoverability test.
The noble Lords who have spoken from building experience know perfectly well that it is extremely difficult to find out when the cause of action accrues. Foundations are laid. The right depth is not gone to, according to the regulations. It is on a rubbish dump. The wrong sort of rubble is put there. Perhaps after a couple of years there is a little subsidence and one of the plates holding up the building slips a bit. Does the cause of action accrue then? A few years later perhaps some weeds come up—this is an actual case—through a crack in the cement. Does the cause of action accrue then? A few years later there are some cracks in the wall. Does the cause of action accrue then? The man probably feels, "Well, this is very annoying, but I am not going to do anything about it." A few years later still the building falls down. There is no doubt that there is a cause of action then.
All these cases—and I repeat that there are many of them not only in our courts but in other courts all over the world—focus on this point and find difficulty in the point: when does the cause of action arise? Does it arise on the first and imperceptible damage or does it only arise when the damage occurs which means something in money on which the man is to sue?
I repeat again for clarification that this has nothing to do with the discoverability problem which is separately solved by this Bill by the additional three years. You have to start with the accrual of the cause of action and the Bill does not help us at all on that point. I know that the noble Lord, Lord Hacking, has much to say on this point which is much more valuable than what I have just said. It is a very real point and I am sorry that the Bill does not clarify it.
The second point is that I believe—I may not have understood the Bill fully—that the provisions about concealments is likely to give rise to some difficulty. Your Lordships will find that on page 4, Clause 2(2). It is a convoluted clause; one cannot follow it in the

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ordinary way. Fortunately, if one goes to the report, it will tell you what it is trying to do. What it is trying to do in paragraph (f) on page 28 is to say that the long stop should not apply in cases of latent damage involving fraud, deliberate concealment or mistake. That is surely very right, but does that not open the door to the whole difficulty with which the report has been dealing—deliberate concealment? Many of these cases are ones of deliberate concealment: the builder covers it up; the inspector says, "All right, let it go, it won't be noticed for some time." Do not worry about fraud, but deliberate concealment is a very great reality. It seems that cases of deliberate concealment are taken out of the long stop provision. We shall therefore be faced with a lot of litigation as to whether particular cases are cases of deliberate concealment or not.
The third point is rather a lawyer's point but I cannot refrain from making it. I am very sorry to see that this Bill follows the bad old English habit of making limitation cases a question of procedure. This is an old English absurdity which has been followed for many years. This country is quite unique in it, and we have our affection for these old things. We keep it as a matter of procedure instead of substance. Every European law does the opposite. I thought that we were going to bring our law into line with European law in order to enable us to ratify their Judgments Convention. Here we find this old thing: limitation is a matter of procedure which related to an old doctrine in Dicey and Morris on Conflict of Laws because we wanted to apply our procedure limits to cases arising abroad. We should forget about it; we do not need it here.
I know that the report has something about contribution, which it says may be helped by this particular provision. I was not impressed in the least by that. I think it is just a case of our old conservatism preserving this rule which is out of date, out of line with everybody else, out of line with our own intending obligation to come into line with Europe. I am sorry to see it here again. It is a technical Bill. I am sorry it is so narrowly based. It has one or two things wrong with it, but it represents a laudable attempt within its limits and within its lights to right a definite wrong and remove a definite difficulty.
I apologise for having kept your Lordships.
Lord Simon of Glaisdale: My Lords, may I slip into the gap behind my noble and learned friend Lord Wilberforce just to make one very short technical point. My noble and learned friend the Lord Chancellor explained why the method of drafting by textual amendment of a principal Act—in this case the 1980 Limitation Act—was adopted. No doubt over and above that my noble and learned friend will take note of the criticisms that were made by my noble friend Lord Hacking and my noble and learned friend Lord Wilberforce. My point is a different one. If this sort of method is adopted I had hoped that immediate steps, before the matter ever came before Parliament, would be taken to ensure that the Statutes in Force were so reprinted that the principal Act—the 1980 Limitation Act in this case—was reprinted with the amendment proposed to be made.
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I hope that my noble and learned friend the Lord Chancellor will be able to assure your Lordships that that has been done, and that if it has not been done, immediate steps will be taken to implement that procedure. I know that he is interested in it and has personally pursued the matter. I hope it will be applied in this case.
The Lord Chancellor: My Lords, this has been a lively and variegated discussion. I would like to thank all those noble and learned Lords who have played their valuable parts in it. I will take note of the last point made by my noble and learned friend Lord Simon of Glaisdale about the Statutes in Force, but he knows that I take an interest in the point and will see that it is looked into. One does not, of course, want to anticipate the decision of Parliament at too early a stage.
Going backwards along the list of speakers. I was very interested in what my noble and learned friend Lord Wilberforce had to say about strict liability and the nature of the law of limitation. I am afraid I have to tell him that, although like everything else he says there was immense penetration and perceptiveness in his argument, basically speaking the choice before Parliament at the moment is not about altering the whole nature of the English law of limitation but about the way in which it applies to a fairly narrow range of cases. I would agree with him that if we were dealing with product liability, as we may be—although the matter is not within my departmental functions as Lord Chancellor—in applying the European rule, it is quite possible that we shall be adopting the principle of strict liability over a range of cases probably wider than, or at any rate different from, the range of cases to which this Bill applies.
The Law Reform Committee quite deliberately, and for reasons which it explains in its report, said that it did not want to introduce into our law of limitation in this particular exercise a principle which operated to destroy the plaintiffs right rather than the principle which is already there and inherent in English law: that it limits the circumstances or time at which he can bring his cause of action. It gave reasons for this. I believe them to be sound. I do not, however, feel any sense of guilt about limiting its terms of reference. I was, like my noble and learned friend Lord Denning, concerned in 1980 with a whole range of cases that dealt with latent damage and not with the whole law of limitation that had been the subject of successive amendments and, finally, of consolidation only a year before under the Labour Government.
I was concerned with the sequence of cases—some have been cited by noble and learned Lords—with which the noble and learned Lord, Lord Scarman, and his committee were concerned. The real point that I am trying to make is that if one considers the time that it took the committee to look at the narrow range of issues with which it was asked to deal between August 1980 and November 1984 and the time thereafter that it took me to find a slot in the programme even for that, your Lordships will, I think, probably agree that although what my noble and learned friend Lord Wilberforce says makes, as it always does, a great deal of sense, I was right, faced with the actual practicalities of the situation, to choose the course of action that I did and to which at any rate by now I am committed.

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Assuming that we are not concerned with strict liability, I must now address myself to the other points raised in the debate. The grand debate lay, of course, between the criticism of the noble and learned Lord, Lord Silkin, from the Opposition Front Bench, who thought it arguable that the long stop provision was too short and rightly pointed out that his own house had subsided after 25 years when the long stop provision is limited to 15 years from the breach of duty, and those noble Lords of whom the noble Lord, Lord Mais, was one and my noble friend Lord Kimball was, I think, another, and there were others, who thought that the long stop period should be shortened still further, some with and some without a change in the definition of the point at which the time should run.
I have to return to something that I said at the beginning. I asked the committee to undertake a limited task. It consulted 140 different entities and came up with the 15-year period running from the breach of duty and not from the occurrence of the damage, which is too short to help the noble and learned Lord, Lord Silkin, and too long to please the noble Lord, Lord Mais, and my noble friend Lord Kimball. Someone asked me to make a compromise. But the 15 years is, in fact, a compromise. Any other period that you choose will be a compromise if you are going to have either a limitation period or a long stop period at all. Five minutes before the period runs out a plaintiff, even though slightly unmeritorious, will be able to exercise his full rights. Ten minutes later, when five minutes have passed since the long stop period came down like a guillotine, he will not be able to exercise any rights at all. It is bound to be a compromise and is bound to have an element of arbitrariness against it. This is what limitation laws are about, whatever form they take.
The noble Lord, Lord Hacking, thought that I was overstating the case when I said at the beginning that my experience had been that potential defendants were articulate, well organised and extremely lucid whereas potential plaintiffs were inarticulate, unidentifiable and not represented. It was only through the matter of chance that the noble and learned Lord, Lord Silkin, came to their assistance in this debate. And that was because it had happened to him. He does not happen to be inarticulate, and the last thing that I would suggest is that he is not well organised. It is, however, a pure matter of chance that from the body of the kirk the potential plaintiff was represented at all. I am not at all convinced that the person in the position of the noble and learned Lord, Lord Silkin, would be in the least mollified by what the noble Lord, Lord Hacking, says when he points to large property companies and the Consumers Association. I do not think that they do represent him. It is my duty to put his point of view. The committee took exactly the same view.
I do not wish to dismiss summarily what my noble friend Lord Kimball said. I would, however, ask him to banish from his mind the bogey of American-type litigation in this country and his picture of lawyers with their wigs trailing and their sticks waving, chasing whatever form of spiritual ambulance it may be to get cases started. This does not happen here. I must point
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out that the two major factors in what has led to this evil, for I believe it to be an evil, although I am not so familiar with American law as I am with our own system is, first, the contingent fee which a potential plaintiff's advisers are entitled to charge; and, secondly, the fact that the civil jury continues to exist in my mother's country—that great mausoleum, or museum, of archaic and obsolete English practices—and that civil jurors in America are quite wise to the contingent fee and aim off in their assessment of damages to make allowance for it. Neither of those features, if I have anything to do with it, will occur here. So whatever else may be true about the periods and the particular criticisms made, that one, I do not think, need be taken seriously as yet.
The only other matter that I should like to mention on Second Reading is that those arguing for a shorter long stop were arguing for the following proposition. Damage occurs on either view. The question, as so often in civil law, is on whose shoulders the loss is going to fall. Their proposition, if I may put it bluntly, plainly and, I hope, not unpleasantly, is that it should fall on the victim and not on the tortfeasor. This is a proposition where the burden of proof lies on those who wish to place it there.
What I have done, and what the committee has done, for the potential defendant is to give him a long stop with certainty and provide that the long stop should not run from the occurrence or discoverability of the damage, as the limitation period does, but from the actual breach of duty. That may mean a great deal less than the 15 years which would have run had it been made to run from the date of damage or any other period. We shall have to return to these matters in Committee. I should like now to conclude my remarks, looking forward to any further debates that we may have later.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Local Government (Temporary Provisions) (Northern Ireland) Order 1986
4.38 p.m.
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Lyell)The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Lyell) rose to move, That the order laid before the House on 13th February be approved.
The noble Lord said: My Lords, I beg to move the Local Government (Temporary Provisions) (Northern Ireland) Order 1986, which was laid before this House on 13th February.
Your Lordships may be aware that the order was made at a meeting of the Privy Council on 12th February this year under the urgent procedure as provided for in Schedule 1, paragraph (1)(4)(b), to the Northern Ireland Act 1974, by reason of urgency and without a draft having been approved by this House. The urgent procedure requires the order to be approved by resolution of your Lordships within 40 days after the date on which the order was made, if the order is to remain in force.
Your Lordships will be aware of developments in Northern Ireland during the past few months and that since September 1985 Unionist-controlled district

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councils in Northern Ireland have been adjourning or even suspending business, firstly, in protest about the presence of Sinn Fein members on councils, and now because of the Anglo-Irish agreement. By the end of January, or even early February this year, it was clear that the adjourning of councils would put at risk the making of district rates for the financial year 1986–87.
Perhaps I should explain to your Lordships that, under the provisions of local government legislation in Northern Ireland, there are three specific functions which must be exercised by councils themselves and cannot be delegated to either officers of councils or to a committee of the council. These functions relate to the making of a district rate, the borrowing of money and land transactions. The failure to make a rate is a clear indication that Unionist-controlled councils wish to intensify their action against the Government's policy. In such circumstances, the Government's first priority has to be the protection of local authority services and jobs, and it was for this reason that on 12th February this year the Privy Council was asked to make the order before us this afternoon.
My honourable friend the Northern Ireland Minister responsible for local government made clear at that time that (I quote shortly):
"this precautionary step is being taken because the Government is not prepared to allow citizens and ratepayers in any district council area to be deprived of those services and facilities to which they are entitled, nor to allow the jobs of council employees to be put at risk through the actions of councillors".
That is what my honourable friend the Minister responsible for local government in Northern Ireland made clear earlier this month.
There are default powers already existing in local government legislation in Northern Ireland. However, these powers are cumbersome as they require a failure to exercise a function or a breakdown in service before action can be taken and, as your Lordships will be aware, such action may take several weeks to complete. Such powers are therefore insufficient to ensure an uninterrupted delivery of local services. The new powers by contrast will provide government with the ability to respond flexibly and in a measured way to disruption of local government.
As it has been indicated by some Unionist councillors that they wish to cause maximum disruption to local government and as the Unionist-controlled councils which have been refusing to meet normally are responsible for providing services to approximately 80 per cent. Of the total population of Northern Ireland, it would be a negation of duty by the Government not to take these necessary additional powers to minimise the damage that could be done either to the public or to the employees of councils. That is the main reason why the Government are seeking the approval of your Lordships to the order before us this afternoon.
Despite the assurances by the leaders of the main political parties involved that protest action against the Anglo-Irish agreement would be constitutional and within the law, noble Lords should be aware that we now have a situation where a majority within Belfast City Council has deliberately defied the rulings of the High Court; where 18 councils including Belfast have deliberately defied a direction from the Department of the Environment to make a district
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rate, having earlier already decided to break the law by not making a rate by the due date; and where these same councils continue to adjourn or suspend meetings thereby putting at risk services in these council areas.
I now turn to the main provisions of this order. Article 3 provides that, if it appears a council has failed or is unable or unwilling to exercise duly and effectually any of its functions, then the Department of the Environment may make an order which would suspend that council and appoint a person or persons to assume responsibility for its functions. It is important to emphasise that, since this is a measure of last resort, the Government would also want to ensure that any application of these powers would not necessarily be permanent. Your Lordships will therefore see that there are provisions for any order so made to be revoked if circumstances subsequently changed and councillors were willing to resume normal business.
4.45 p.m.
It is also important to draw your Lordships' attention to paragraph 2 of Article 3, as this will give the power for the suspension from all other public bodies to which a councillor has been appointed or elected by virtue of his membership of a district council. It would be anomalous to suspend district councillors from their council activities and not at the same time consider their suspension from those other public bodies on which they purport to represent local interests. The remaining provisions in Article 3 are consequential to the suspension of councillors and their replacement by other persons. These consequential provisions will ensure that those persons appointed to look after the councils's interests have the full authority of the law to continue to exercise all functions previously exercised by the council.
Paragraphs (7) and (8) of Article 3 are designed during the period of direct rule to preserve the position of the Assembly if legislative powers were devolved to it. While direct rule continues, they are modified by Schedule 1 to the Northern Ireland Act 1974 which suspends the requirement to lay such orders before the Assembly in its present consultative form. Your Lordships will see from Article 4, at the foot of page 3 and over the page, that the legislation shall remain in force until 31st May 1988 but could, if necessary, be extended for periods not exceeding one year until 1991: that is, for a five-year period in all.
The Government will not be diverted from their objective of safeguarding those services in Northern Ireland which are a fundamental entitlement in any society. The Government have been patient over a period of months during which local councils have not been meeting, but the stage has now been reached where it has proved necessary to seek these additional powers on a contingency basis in order to be in a position to secure the provisions of local authority services and to protect jobs. I hope that these powers will not have to be used, but as a measure of last resort the Government are prepared to do so.
It is worth reminding Unionist councillors that the services provided by their councils, such as health inspection, burials, building control, refuse collection and the operation of leisure facilities, are for the

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benefit of all sections of the community. It is the Government's wish that these important local services should remain under the control of local elected representatives, but if this proves to be impossible the Government must be certain that they can take steps to protect innocent members of the community.
I have explained the background against which the Government found it necessary to introduce these new powers and I have given a brief summary of their intent. I am sure that your Lordships will agree that the Government's action is justified in the circumstances and will recognise that the powers would be used only if absolutely necessary. I commend the order to the House.
Moved, That the order laid before the House on 13th February be approved.—(Lord Lyell.)
Lord Prys-Davies: My Lords, regrettably the choice has been made by the Unionist-controlled district councils to adjourn meetings of their councils and to refuse to strike a rate for 1986–87 in protest against the Hillsborough agreement, although that agreement has been overwhelmingly supported by Parliament. We have heard from the Minister—indeed, we have read in the newspapers—how councils were directed by the Department of the Environment in Belfast to carry out their functions and to strike a rate. They defied the directive. This policy of defiance and obstruction is unlawful. Not only is it unlawful, but it is extremist and irresponsible—irresponsible because it puts important services (which the Minister has mentioned) and jobs at risk. Given this situation and this escalation, we agree that the Government have no alternative but to introduce this order, which will give them the statutory authority to take over all the functions allotted by law to the district councils should this become necessary. That caveat has been entered more than once by the Minister in the course of his speech this afternoon.
If the policy of opposition to central government policy which has been adopted by the opposition should lead at some future date to the implementation of this order, that would be an ironic consequence for Unionist councillors to impose upon their communities. I understand that the functions of the disctrict councils in Northern Ireland are relatively modest, and are far fewer than those discharged by the district councils in England and Wales. Nevertheless, the services carried out by the district councils are important and cannot be allowed to break down. The dead have to be buried; refuse has to be collected; drains have to be cleaned; and streets have to be swept. They are the requirements of a civilised community.
If one day in the future the district councils have to be run by commissioners appointed by the Department of the Environment and without accountability to the local community instead of by democratically-elected representatives who have walked out on their councils, that would be the choice of the Unionist councillors. In those circumstances, the Unionist councillors cannot fairly complain of dictatorship by the Department of the Environment, and yet this accusation is already being intemperately hurled by the councillors and others at the department. This is sheer propaganda, whether consciously or otherwise, to mislead the public.
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It is sad that councillors who have served their wards and have been prominent in public life for years should now walk away from their councils. One would have thought that to remain in control of their councils, watching local expenditure and the quality of local services, would at least ensure accountability of government at district level to the local community. But this decision to defy the department, the decision to adjourn their councils, suggests deep-seated frustration, or possibly trauma, felt by the Unionist leaders. That I certainly acknowledge. We would not from this side of the House underrate the frustration or the trauma. But to the Unionist leaders we would say that they do not best serve their cause by taking the law into their own hands and effectively suspending the councils which were entrusted to their care by their electorate.
For all those reasons we approve the order. Indeed, this is the only practical answer available to the Government if services and jobs are to be protected. We know only too well that some 150 jobs with the community groups in Protestant areas are already seriously at risk. This is the cause of anxiety in the Protestant community. Is it possible, as it becomes clearer that the policy of non-co-operation puts jobs at risk, that the Unionist councillors will have second thoughts?
The Minister has explained to your Lordships' House that the decision to introduce this order has not been hastily approached. Councils were stood adjourned generally in September last, but it is only now that the Government bring the order before the House. This may be an indication—I think that the noble Lord hinted at this—that the order will not be hastily implemented. But this is not to suggest that the Government should wait until the point of breakdown of services is reached before they exercise the powers which this order gives them. With those few comments, and with a certain degree of sadness, we approve the order.
Lord Donaldson of Kingsbridge: My Lords, the noble Lord, Lord Prys-Davies, speaks of sadness. That is what I feel intensely at the moment. This seems to me to be the first sign after the general strike, which was an explosion, of something which may be very bad indeed for all of us—so much so that I feel impelled to pause for a moment to look at what has happened to the loyalty to this country of the loyalist majority in Northern Ireland: our friends and compatriots who are now deliberately trying to reduce their part of the United Kingdom to anarchy.
They are doing this because they feel unable to accept a minimum step towards treating the minority community as citizens with equal rights to their own. I think it is worthwhile trying for a moment to explain—I say to explain to them, but I think it may be too late—the logic of the intense disapproval of their attitude on the part of so many British citizens on the mainland. I shall give my own version of this, but I think it is widely shared in the Alliance Party, the Labour Party, and in many parts of the Tory Party.
I believe that what is important for Northern Ireland in the long run is not whether it finally consents to join the South, but whether it can manage its own affairs so that the whole population turns against the senseless

821
years of brutal and often cowardly killing by the IRA. Only with the help of the whole population can this be achieved, and it will take years of determined government. To obtain this consensus we must put right the most obvious of the many complaints made by the minority community of unequal treatment; of no say in government; of secretarianism in the RUC; of discrimination over housing, employment, and so on. The Unionists freely admit the existence of these complaints, though they claim that they are mostly unfounded. We on the mainland do not agree. We think there is a great deal which must be altered if the Province is to remain a part of the United Kingdom.
During the last year both sides have agreed in writing in the New Ireland Forum and The Way Forward that they must live peacefully together, which means respecting the views and aspirations of the other side even while not agreeing with them. I believe that the only way forward is through devolved government with both sides sharing power, which they showed in 1974 they could do very well if they could be protected from the attacks from the hard men on the Unionist side. The Government are pledged to work for this and we shall support them, but first agreement must be found on the manner of partnership in the new Assembly.
The SDLP sadly failed to come in at the last attempt. They insisted that certain points must be conceded first. One—and for the Unionists the most difficult—was some recognition of what has been called the Irish dimension. The demand was for joint sovereignty, or at least joint authority between the British and Irish Governments. Our Government, in my opinion rightly, refused firmly to agree to either. The most they would concede was joint discussion to take place in the standing conference, with no powers of action at all. All powers would remain with the British Government, but clearly they could be influenced in their action by such a conference. The concession was so small that Dr. FitzGerald was bitterly attacked by Mr. Haughey for agreeing to it.
It is to destroy this function of consultation, which to me seems entirely harmless, that the Unionists called the one-day strike. They failed to prevent their supporters from acting with brutal violence, much to their shame, and are now proposing to paralyse local government by refusing to do their duty as councillors. Their intention, openly stated, as the Minister said, is to produce such anarchy that government is impossible and to do it by imposing real hardship on the people by stopping, or trying to stop, many services on which so many depend not only for their comfort but for their living, and, indeed, as the noble Lord said from the Front Bench, for their dying.
5 p.m.
It seems to me to be unforgivable to behave like this over an issue which involves no transfer of authority from the Government and which was conceded to encourage Mr. John Hume to persuade the SDLP to discuss terms for joining the assembly. If it could have been accepted, we should by now have had a devolved government and with it the gradual transferance of subjects to it from the conference terms of reference. This, in my opinion, is the key to all future progress.
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As it is, we are confronted with legislation to deal with the councillors' strike.
There is a gleam of hope. The Unionist leaders have, it seems, suggested further talks, though I am not sure how firm this suggestion is. Certainly the Prime Minister has made it clear that she wants them. Mr. Hume, none too soon, has said that he will talk to anyone at any time, though I beg him to be generous, having achieved so much of what he wants, and to help the Unionists to co-operate by not sticking on detail. Something therefore may happen. But those of us who, like myself, have always sympathised with the determination of the Unionists to remain British are deeply shocked. I believe that this agreement, far from being a step towards a united Ireland, could be the last chance for the Unionists to maintain their present position as full British citizens.
I turn at last to the order before us. Though I have spoken for myself up to now, I speak for the Alliance parties without equivocation in supporting it.
Lord Fitt: My Lords, it is an indication of British insensitivity to the Irish situation that we are discussing these orders on St. Patrick's Day. One would have thought that there could have been a more appropriate time, but perhaps there was an emergency situation. However serious the first order may be, it will be even more insulting that on the next order we shall be discussing the mental health of Northern Ireland, which, I think it would be conceded, has been seriously affected by the Anglo-Irish Agreement.
I have been a Member of this House for a few years now; I was a Member of another place for many years. I recall when the boot was on the other foot, when I was the leader of the minority population. As I have said on occasions in this House, the great ability of the English has for many years been to compromise: an Ireland that does not exist, an Ireland where there are victories and defeats. I recall vividly in 1971 when Irish nationalism met the total opposition of the Northern Ireland Parliament, supported by the British Government on the introduction of internment. What did the Irish nationalist population do? They withdrew from all the local authorities on which they were represented. They called on the nationalist members of local authorities, as they were then constituted, to absent themselves. They called on the nationalist population to boycott and abstain from the institutions of government because the Catholic nationalist population saw in those days that they were being victimised by the institutions of government.
In 1986, 14 years after, we find that the wheel has turned full circle and the Unionists now feel how the nationalists felt then. The history is that the Unionists in Northern Ireland have no real history of rebellion. Throughout the centuries, particularly in these last 100 years, they have succeeded in imposing their will on a succession of British governments by threatening what they would do: in 1886, 1903, 1910, 1912, 1914 and 1974. But now they are faced with a British Government who have decided, rightly or wrongly, to have the Anglo-Irish Agreement. The Unionist or Protestant in Northern Ireland does not know what to do in this situation. He gets out his newspaper cuttings or goes to the library and asks, "What did the Nationalists do when they were in a situation such as

823
this?" He sees that Gerry Fitt was leader of the nationalist party. When things were not going the way that Gerry Fitt for the SDLP wanted them to go, he advised his councillors to withdraw from the local authorities. That is what I have repeatedly said in this House.
There are two sections of the community in Northern Ireland. They are motivated by the same impetus in their opposition to what they feel to be an injustice. When the nationalist minority felt that they were being unjustly treated, they withdrew from public life. Now the Unionists feel that. Whether I agree that what they feel is right or not, they feel that they are being unjustly victimised.
This order is before the House because the Unionists are in a majority in Northern Ireland. When the nationalists withdrew their councillors from the local authorities in the 1970s, the Unionists—the British Government since 1972, since direct rule—did not have to take any real action such as this, with the exception of one case. The withdrawal of the nationalist councillors from local authorities did not have the devastating effect that the withdrawal of the Unionists will have, because the Unionists hold 18 out of 26 seats. The nationalists, being a minority, did not have that punch.
This is not the first time that this has been done. There was the famous, infamous or notorious Deny city council (Londonderry city council, as it then was) which over the years had gerrymandered itself in favour of the Unionists against all the laws of natural justice, and the overwhelming majority of the people living in the city of Derry were Nationalists and opposed to unionism. But because of the vicious system of gerrymandering, the Unionists had totally unjustly controlled that town. The British Government had no hesitation then, and I applauded them for it at the time, in abolishing the Londonderry city council and putting in commissioners. The commissioners received the support of the overwhelming population, even of the Unionist population, in the city of Derry when this happened. If the Government are forced to act in this, people in local authorities may feel that they would rather have commissioners then councillors.
One has to take into consideration the psychology of local authority councillors. I was one for 25 years, and so I have half an idea of what it is all about. There is nobody in political life in this country who feels himself to be more important than the local councillor. When they are fighting elections in Northern Ireland, you would almost think it was a presidential election, and particularly under PR. You get the strangest candidates, the strangest elections and even more strange results. And these people are now—or, are they? I ask them through this House—prepared to put their positions of importance into jeopardy. Would the Government, for example, consider taking action against those councils in Northern Ireland who have refused to strike a rate, to surcharge them and to disqualify them from serving for five years? Would it be possible for the Government to do that? They have done it in Lambeth and at Liverpool. Would the Government consider
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doing that in the 18 councils throughout Northern Ireland?
How many men would you disqualify in that situation? So far as concerns the Unionist councillors who have been elected, it has already been said here by the Front Bench on this side of the House that many of them have given what they consider to be and what their own community considers to be sterling service throughout the years. But because of their deep-rooted feelings of insecurity and opposition to this agreement, they have withdrawn their services from the local authorities.
Having said what I have, I think it is right that the Government should take these emergency powers. I am not a representative of West Belfast now; I am not an elected representative. But over the past number of days I have received numerous requests from the community organisations in West Belfast, the constituency which I formerly represented and which is now allegedly represented by a pseudo-IRA man. He cannot make any plea to this Government. So the people who rejected me at the polls—and I have no doubt that they are some of the people who are writing to me now—are asking for me to put forward their point of view on what may happen before the end of this month. They fear that there will be many people in the community associations, in the graveyards, in the cleansing departments in the city and constituency which I formerly represented who, unless emergency powers are taken, will find themselves out of a job with no guarantee as to when and where their jobs will be reinstated.
I say to the noble Lord that I do not think that anyone in his right mind could oppose this legislation because it is taken in an emergency situation. But while saying that, I go along with what has been said by my noble friend, Lord Donaldson. He perhaps cannot see as readily as I do the fear that exists among the Unionists, but he recognises that it is there. He has made an appeal here today, and I would reinforce that appeal, that to allay the fears and the suspicions that exist in the minds of the Unionist population, and in this case in the minds of their local authority representatives, the SDLP should make a further reciprocation. They should keep trying to do something to allay the fears that exist within that Protestant community.
There are two sides to the conflict in Northern Ireland and I have seen the two sides. That is perhaps why I was not the most successful of politicians in Northern Ireland. It is very easy to see one side and guarantee your own success. Incidentally, my Lords, just think of the term "emergency"! How many emergency legislations have we had since the advent of direct rule in 1972? How many emergency legislations did we have since 1922 in the form of the Special Powers Act in Northern Ireland?
It is necessary to bring forward this legislation. But I say do not implement it too hastily. Do everything that you can to bring those councillors back to what they have been regarding as their duties; because it is only by doing that that you will make this type of legislation unnecessary in the future.
5.15 p.m.
Lord Lyell: My Lords, we are immensely grateful for the interest shown by noble Lords who have

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spoken and to other Members of your Lordships' House who have listened to what I believe has been a very succinct summing up of the entire political scene in Northern Ireland by the noble Lord, Lord Fitt, and certainly, all the very worthwhile and valuable contributions that have been made by both the noble Lord, Lord Prys-Davies, and the noble Lord, Lord Donaldson.
Perhaps I may first of all thank the noble Lord, Lord Prys-Davies, for his forthright support for the measures which we have outlined in the order. I think that this is a common theme, certainly in the preliminary remarks that I made and in the entire debate this afternoon, that these powers which we have in the order before us are to be used very much as a last resort.
The noble Lord, Lord Prys-Davies, mentioned this defiance of councillors in showing their defiance of the Anglo-Irish agreement and the noble Lord also stressed the importance of the functions of local councillors in Northern Ireland. I think he mentioned the word "dictatorship"—the cry of "dictators" and "dictatorships" that came towards the Government and to the Northern Ireland Office. Your Lordships who are acquainted with Northern Ireland will realise that that is particularly mild. When people call me a dictator, I tend to think that they have been off their food or are ill because we expect much stronger meat than that. Nevertheless, I take the point that was raised by the noble Lord, Lord Fitt. Nobody who is interested in Northern Ireland, who visits there or who lives there, as does my noble friend behind me can fail to be aware of the very strong feelings in regard to the Government and to the political situation which exists in Northern Ireland at the moment.
The noble Lord, Lord Prys-Davies, raised one particular point which has caused concern here, in another place and in Northern Ireland. He touched on what we call the voluntary groups or voluntary bodies. I shall try to reassure the noble Lord and your Lordships who are interested in these groups. I understand that a meeting of Belfast City Council has been called for 27th March when the matter of grants to voluntary bodies will be included in the agenda. I am afraid that this is very conditional and hypothetical; nevertheless perhaps it might be hopeful.
The Government will be monitoring closely what decisions emerge from that meeting. Therefore, it will be premature for me to comment in advance upon what measures the Government might consider to ensure continuity of support for all those bodies who might be at risk. Of course, that does not just mean those bodies in Belfast. It would also cover the voluntary groups in other council areas.
Lord Donaldson of Kingsbridge: My Lords, before the noble Lord leaves that point, I have sent him a copy of a letter today. I see that the noble Lord indicates that he has received it. Will he keep me advised as to what action happens as a result of these meetings and let me know whether it applies to the letter I have sent to him?
Lord Lyell: My Lords, the noble Lord, as always, is lightning fast, rather like the Irish threequarters on Saturday afternoon, and I am pleased that the noble Lord is keeping up their momentum. I have received
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his letter. I am afraid that I have read it but I cannot comment yet. I shall certainly look into it and shall be in touch with him. If there is any specific point, then we shall be able to cover it when I reply and keep the noble Lord informed. But the thought that I had about our understanding that there will be a meeting of Belfast City Council is hedged, as the noble Lord of all people will be aware, with the usual Government caution. However, I take note that I have received a very valuable letter from the noble Lord and we shall deal with it expeditiously and in detail.
In reply to the noble Lord, Lord Prys-Davies, I reaffirm what I said about voluntary groups. Any appointment of a commissioner would be only as a measure of last resort, and the grant-aiding of local community groups is in itself a permissive power available to councillors. These issues, in the first instance, would be for local councillors to consider, and of course commissioners are very much a long stop.
We are grateful for the forthright support of the noble Lord, Lord Donaldson, for the measures in the order. Your Lordships will be aware that the noble Lord was a distinguished precursor in my present office and he is fondly remembered in many parts of the Province. Wherever I go people keep on asking after him and hoping that he is in good health. I have to remind everybody that those of your Lordships who come to speak on Northern Ireland matters here are in very good health.
The noble Lord referred to the sad events of 3rd March. All that I would wish to do this afternoon is to reiterate what I said then. The pictures sent by electronic media and also in printed form throughout the world showed what the noble Lords, Lord Donaldson and Lord Fitt, and my noble friend know, that that is not the true face of Northern Ireland. This was an aberration. It was particularly sad, and I would hazard a guess—if one is allowed to do that from this position—that what happened on that day is slowly being recognised as most unhelpful to everything that all of us want in Northern Ireland. I am of course very grateful for the support that the noble Lord, Lord Donaldson, gave to the order.
The noble Lord, Lord Fitt, speaks with considerable authority, since he has had a long history of service to Northern Ireland, and all your Lordships will appreciate everything that he did in Northern Ireland and continues to do in your Lordships' House. He mentioned that the Unionists would rush along to the public library and might be tempted to follow the boycotting events of 1971 and 1972. I would hazard something stronger than a guess that the Unionists would be very foolish if they did that. What they probably should be doing is reading the newspapers and perhaps following the noble Lord, Lord Fitt, in his other, more profitable, activities which will be familiar to your Lordships. Perhaps if the Unionists were to follow the noble Lord's record in that way, they might be a great deal healthier. However, I do not think the Unionists need any lessons in obstruction or foolish tactics from what happened in 1971 or 1972.
The noble Lord, Lord Fitt, mentioned the word "surcharge". The law in respect of surcharge in Northern Ireland is quite specific. A local government auditor may apply to the court for a declaration that

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any item of account is contrary to law, and if the court makes such a declaration the person or persons responsible for authorising or incurring such expenditure shall be liable to repay the amount in question. Also, where it appears to a local government auditor that a loss has been incurred or a deficiency caused by the wilful misconduct of any person, he shall certify that the amount of the loss or deficiency is due from that person.
Certainly it would not be proper for me to speculate on whether the present action by councils will result in penalties of this nature. The law demands that these are matters for the local government auditor, in his quite independent capacity, to consider. I would stress to your Lordships that there is no clear parallel with the events which took place in Liverpool. We hope that this question of surcharge will not arise, but it is not something that we could help with, especially this afternoon, because it is a question for the local government auditor in his independent capacity. His duties and powers are laid down by statute and I think the noble Lord, Lord Fitt, would agree that we should leave it there.
I think I have said enough. We are all immensely grateful for the support that has been received for this order. I stressed to your Lordships that it is a long stop power, but we feel that it is prudent and indeed necessary to have the order.
On Question, Motion agreed to.

Mental Health (Northern Ireland) Order 1986
5.26 p.m.
Lord Lyell Lord Lyell rose to move, That the draft order laid before the House on 28th January be approved.
The noble Lord said: My Lords, I beg to move that the Mental Health (Northern Ireland) Order 1986, a draft of which was laid before the House on 28th January this year, be approved.
The order, as your Lordships will see, deals with the status and legal position of the comparatively few people suffering from mental disorder who need special protection or control either in their own interests or in the interests of others. It replaces and amends the existing mental health legislation which is contained mainly in the Mental Health (Northern Ireland) Act 1961.
Although this Act has worked very well, there have been considerable changes in mental health service structures and practices in the 24 years since it came into force. These include such developments as the advent of the open door hospital, the shift to community care and the introduction of multidisciplinary team management. Public attitudes have also changed, as I think your Lordships would agree. There is a much greater emphasis on individual rights and an increased demand for legal safeguards to protect those rights. The new proposals are intended to bring the mental health legislation into line with these changes and to provide a statutory framework which will not frustrate future developments.
The order gives effect to the proposals of an interdepartmental working group. These proposals are
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largely based on the recommendations of the MacDermott Committee. This was an independent committee set up under the chairmanship of a distinguished member of the Northern Ireland Judiciary, Mr. Justice MacDermott, to review the mental health legislation there. We are deeply indebted to him and his committee for providing us with such a well-formulated blueprint for new legislation. Some of the proposals in the order reflect the changes made to the mental health legislation in Great Britain and will perhaps seem familiar to those of your Lordships who participated in the long and intensive debates on the English and Scottish amending Bills.
The main effects of the order are to improve safeguards for people compulsorily detained in hospital or placed under guardianship, to clarify the position of staff looking after them and to remove uncertainties in the law. However, the order is not a new statement or philosophy of the law. The 1961 Act established a number of important principles. Among them are those which require that where care and treatment in hospital are needed, they are given on a voluntary basis wherever that is possible and that, in those few cases where compulsion is necessary, it should be subject to very strict controls. I doubt whether any of your Lordships here today would challenge those principles. The order, although it introduces many new provisions, certainly does not seek to challenge them. On the contrary, it seeks to ensure that they are implemented in a better way.
Like the Mental Health Acts in England, Wales and Scotland, this is a very long and in parts complex piece of legislation. I am sure that your Lordships would not wish me to deal with each article individually, so perhaps I may direct your attention to the main provisions, especially to the ones which are new, and to those which vary significantly from the 1961 Act. If your Lordships wish to raise any points about the provisions contained in the Act, I shall do my very best to respond to them. If I am unable to do so this afternoon, I guarantee that we shall be in touch, expeditiously, in writing. I am sure that your Lordships appreciate that the measures are long and detailed. I shall do my best.
If we turn to Part I, we find that it deals with definitions. The first change here is the introduction of a definition of mental illness. This is the first time that mental illness has ever been defined in United Kingdom legislation, and the intention is to identify clearly, for the benefit of patients and staff alike, those characteristics of mental illness which justify the use of compulsory powers.
The second change is the replacement of the term "arrested or incomplete development of mind" by the term "mental handicap". Both terms refer to broadly the same group of people, but the latter reflects current medical perceptions of the nature of mental handicap by emphasising the importance of social functions, such as the ability to eat, control one's bodily functions, learn new skills, recognise hazards or exercise reasonable judgment and foresight.
The lack of these abilities is now considered to be as much a part of mental handicap as low intelligence, and their inclusion as essential elements in the

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definition is intended to make it clear that a person who is intellectually dull but otherwise normal is outside the scope of the order.
Another change is the disappearance of the expression, "person requiring special care" and the use of the synonymous term, "severe mental handicap" to identify those mentally handicapped people who may be placed under guardianship or who are protected against sexual abuse. The difference between "mental handicap" and "severe mental handicap" is one of degree. It is entirely a matter for clinical judgment as to whether a person exhibits "significant" or "severe" impairment of intelligence and social functioning.
A very important change is the introduction of "severe mental impairment" as a new sub-category of "mental handicap". This is defined in the same way as "severe mental handicap" but includes the additional element of abnormally aggressive or seriously irresponsible conduct. The effect of that is to make it impossible for mentally handicapped people to be compulsorily detained in hospital for treatment unless their handicap is severe and they present abnormally aggressive or seriously irresponsible behaviour. In that way, the new category distinguishes the small number of mentally handicapped people who need to be detained in hospital under long-term powers, from the majority who do not. It ensures that mental handicap, no matter how severe, can never constitute by itself a sufficient ground for long-term detention.
There is a body of opinion which continues to insist that compulsory powers are not needed for the mentally handicapped, and that they should therefore not be included in the legislation at all. I understand and appreciate the strength of the conviction with which that view is held. Most mentally handicapped people can and should receive the care and training that they need on a voluntary basis. Nevertheless, the weight of professional opinion is that there is a very small minority of mentally handicapped people, without any other mental disorder, for whom compulsory powers are needed, either in their own interests or for the protection of others.
Part I also introduces the concept of a substantial likelihood of serious physical harm as one of the two criteria for compulsory admission to or detention in, hospital. The purpose of this is to ensure that all decisions to admit or to detain a patient are based on objective evidence that the patient is likely to be dangerous either to himself or to other people.
The new criterion is of course rather more restrictive than the one in the 1961 Act which it replaces—that detention should be in the interests of the patient's health or safety or for the protection of others. That is precisely why it is being introduced. Compulsory admission or detention is a very serious step involving deprivation of liberty and the restriction of individual rights and freedom of action, and it is clear from the responses received during the consultation period that the prevailing view in Northern Ireland is that it can be justified only in extreme circumstances.
Part II deals with compulsory admission to hospital and reception into guardianship. It makes a number of important changes to the existing provisions. A new system of admission is introduced by Article 4. Central
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to this is the period of assessment. All patients who are compulsorily admitted to hospital will be held initially for an assessment period of up to 14 days before a decision is taken as to whether they should be detained under the long-term powers. During that period there will be a precise diagnosis of the patient's mental state and a comprehensive assessment of the need for compulsory admission. This period is half that of the assessment period under the English Act, but it is generally accepted by professionals in Northern Ireland as long enough to enable a decision to be reached.
Article 12 of the order provides for the assessment period to be followed by detention for treatment. The use of the term "treatment" makes it clear that the purpose of such detention is therapeutic rather than custodial. The authority to detain a patient for treatment lasts for six months and then it must be renewed for a further six months, after which it must be renewed every year, thereby halving the period for which a patient may be detained under the 1961 Act without a renewal of authority.
The order authorises psychiatric and mental handicap nurses of certain classes, which will be specified in regulations, to restrain patients from leaving hospital for up to a maximum of six hours, until a doctor can be brought. That power is similar to that in the English Act and has been welcomed by the nursing profession because at the moment nurses have to rely on common law powers which, because of their uncertainty, they are reluctant to use.
Only very limited use has been made of the guardianship powers under the 1961 Act. To encourage greater use of that useful and less restrictive alternative to detention in hospital, the powers of the guardian are more clearly defined and restricted to those which are essential for ensuring that patients receive the medical treatment, social support and, above all, the training that they require.
In addition, it will no longer be possible for children under 16 to be received into guardianship. Instead, they will be dealt with under the children and young persons legislation or, if appropriate, by voluntary admission to hospital. In future, guardianship will have to be in the interests of the welfare of the patient rather than simply in his interests. That will clarify the purposes of guardianship and it further restricts the powers.
Finally, the authority for guardianship must be renewed at the same intervals as the authority for detention for treatment—at the end of the first six months, at the end of the second six months and subsequently, for one year at a time. We must obviously look at the objections of nearest relatives. The nearest relative continues to have the right to veto an admission or guardianship, but in an emergency the order now allows a patient to be admitted to hospital or to be received into guardianship against the nearest relative's wishes if the approved social worker making the application consults a second approved social worker.
Part III deals with the group of patients which is called offender patients. It deals with the admission to hospital of persons who are concerned in criminal proceedings or transferred to hospital from prison. It

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follows very closely Part III of the 1961 Act, but it introduces a number of changes which reflect amendments to the law in England.
In future, courts will be allowed to send accused persons to hospital for limited periods of time to be examined or treated for mental disorder before taking a final decision in their case. Courts will continue to have the power make a hospital order, regardless of the availability of a hospital place, but the health and social services board responsible for the administration of the admitting hospital will be given an opportunity to make representations to the court before an order is made.
Restrictions on discharge will only be imposed where it appears to be necessary,
"for the protection of the public from serious harm".
Finally, restrictions on the discharge of patients who have been transferred to hospital from prison will end at the earliest date of release, had the patient stayed in prison and earned full remission, and not at the date his sentence ends, which is the present case.
Part IV is new and clarifies the circumstances in which treatment can be given without consent. The 1961 Act does not give any express authority to treat patients. It had been assumed that the authority to treat detained patients without their consent was implied, but this assumption is no longer valid. These new provisions are very similar to the corresponding provisions in the English and Scottish legislation and the issues involved were thoroughly debated during the passage of the amending Bills.
Part V of the order brings together the provisions relating to the Mental Health Review Tribunal and introduces a number of new measures designed to strengthen it and to increase the opportunities for patients to have their cases considered by it. The right to apply to the tribunal is extended to patients under 16 and to offender patients with restrictions on their discharge or who have been conditionally discharged. Any case which has not been considered for two years will be automatically referred to it for review and, if appropriate, a hearing by the responsible health and social services board.
The powers of the tribunal are widened. It will share with the Secretary of State the power to discharge restricted patients. To allow adequate time for appropriate after-care arrangements to be made, it will be able to direct a patient's discharge on a future date. It will also be able to recommend leave of absence, transfer to another hospital or transfer into guardianship to facilitate future discharge. In addition, the restrictions on the numbers of members who may be appointed to the tribunal are lifted to enable it to cope with the increased workload.
Part VI provides for the establishment of the Mental Health Commission to protect the interests of the mentally disordered. The commission will be an independent multi-disciplinary body of not more than 12 part-time members, including the chairman and vice-chairman. Unlike its counterpart in England and Wales, the Mental Health Act Commission, the new body's role will not be restricted to detained patients. It will cover voluntary patients, people in guardianship, people in residential accommodation and, indeed, anyone suffering from mental disorder.
The commmission will monitor the working of the order, investigate complaints, visit patients, make reports to the appropriate authorities and, very importantly, it will have a discretionary power to require these authorities to provide it with information about the action they have taken as a result of any report. Other functions of the commission include the appointment of independent doctors and other persons to verify consent and to provide second opinions for the purposes of the consent of treatment provisions; the appointment of the doctors required for the admission, detention and guardianship procedures under Part II; and the review of decisions to withhold patients' mail. I am aware of the excellent work done by the Mental Health Act Commission for England and Wales, so ably led by my noble friend Lord Colville—I do not see him in his place—and by the Mental Welfare Commission in Scotland. Part VII deals with the registration of private hospitals which are the equivalent of mental homes in England and is a re-enactment of Part IV of the 1961 Act. Part VIII is concerned with the management of the property and affairs of mentally disordered patients and replaces the existing law on this subject, mostly contained in the Lunacy Regulations (Ireland) Act 1871, which was 115 years ago. So Part VIII brings everything up to date. These new provisions are based on the corresponding provisions in the English Act, but take into account the differences in Northern Ireland's legal system.
Part IX contains a code of practice and places a number of miscellaneous duties on the Department of Health and Social Services Board. Two of these reflect measures introduced in the 1983 Act. The first is the duty of the department in Article 111 to produce, publish and keep up to date a code of practice for the guidance of professional staff concerned in the treatment of mentally disordered patients. The second is the duty placed on health and social services boards by Article 115 to appoint approved social workers. Mental health has a social as well as medical and legal dimensions. The order acknowledges this by allocating social workers a new and distinctive professional role. At the same time, the order recognises that social workers need special training and experience to ensure high standards of professional practice in carrying out this role, and accordingly provides that no one shall be appointed until approved by a board.
5.45 p.m.
Part X deals with offences. These are very much the same as those in the 1961 Act, except that the provisions relating to sexual offences have been brought into line with the law in England and Wales. The final part of the order—Part XI—deals with a number of miscellaneous and supplementary matters which, in the main, are re-enactments of similar provisions in the 1961 Act. I will mention just one, Article 127, which reaffirms the fundamental principle that people who suffer from mental disorder should be able to receive treatment in hospital, without the need for any special formalities, in the same way as people suffering from physical disorders.
That concludes my outline—my notes say "brief outline", and your Lordships have been very patient

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and kind—of the main provisions of the order. It is a lengthy and detailed order, which is also very interesting and important. There are many other changes, but the basis of them all is the need to strengthen the rights to safeguard the liberties of the mentally disordered while retaining a proper regard for the rights and safety of the general public and staff who look after the mentally disordered with such care. Although it is perhaps not as revolutionary as the 1961 Act was in its time, I believe the order will be a landmark in the history of mental health care in Northern Ireland and that the changes which it introduces will significantly improve the quality of life for people suffering from mental disorder in the years ahead. With that, I commend the order to your Lordships. My Lords, I beg to move.
Moved, That the draft order laid before the House on 28th January be approved.—(Lord Lyell.)
Lord Prys-Davies: My Lords, this is not only a long and detailed order. I find it to be a complex order, but the failure may be mine. Although objections—and sometimes serious objections—have been raised by two or three of the bodies concerned to the provisions of the order, it has nevertheless been well received by the voluntary, the professional and the statutory bodies concerned and, as the Minister has explained, the order is seen as an important step forward which will be of value to the patients, to their relatives and to the staff involved in their care. I am sure that we shall not do justice to this order this afternoon.
It is an important order, because compulsory detention in a psychiatric hospital is one of the very few situations where the law permits a person to be held against his will without prior access to a court. The Minister has explained the provisions and the structure of the order and has emphasised its main effects. It will improve the safeguards for mentally disordered people who are compulsorily admitted or detained in hospital. It clarifies the position of the staff who are looking after them and makes provision for the management of the property and affairs of patients. Following the England and Wales and Scotland legislation, it establishes a Mental Health Commission for Northern Ireland to keep under review the care and treatment of patients.
I mentioned that there have been strong objections to some of the provisions and one ought to place the objections on record, though I do not believe that I can do justice to them. The National Schizophrenia Fellowship are concerned about the criteria in Article 4(2)(b) for formal admission of patients into hospital. They would much prefer the criteria contained in the Mental Health Act 1983, which applies in England and Wales, and in the relevant legislation for Scotland. Again, in fairness, the Minister has touched upon this. The bodies which have a special interest in the mentally handicapped are disappointed that mental handicap should be included in a mental health order.
They also disagree over the definitions employed in the order. The Minister has quoted some of those definitions. They disagree with the definitions and they regret that the order should depart from the legislation for England and Wales in its general treatment of mental handicap. My only point is that the criteria for
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compulsory admission to hospital and the definitions of categories of mental handicap are not political issues and it is therefore surprising to this layman that different criteria, different definitions, should apply within this small jurisdiction of England, Wales, Scotland and Northern Ireland. Should not the criteria and the categories be consistent and unified throughout the different parts of the United Kingdom, or will the Minister say that the common sense of the layman is flawed in supporting this plea?
I return to the broad area of agreement. All the comments which I have read welcome the proposed Mental Health Commission. This is seen by all the bodies concerned—without exception—as a notable innovation, but it would be even more welcome had it been given more powers and more resources. Although the department has stuck to its view—it may be a sound view as far as I know—that the commission should not be an enforcement agency, there is in general satisfaction that the original draft of the order has been amended to enable the commission to publish on its own initiative such reports on its functions as it thinks fit and that the original draft order has also been amended to impose a duty on the various authorities to reply to an inquiry emanating from the commission. These are two important amendments and they go some way to strengthening the role and authority of the commission.
Drawing on the goodwill of all the bodies concerned with mental disorder, the commission could bring a new impetus to this complex field. Yet many people fear that the commission will not work as well as it is hoped because it will have inadequate resources. How does the Minister propose to allay the fear that it has inadequate resources to do a proper job? In any event, can the Minister give an indication of what the additional expenditure which is envisaged will amount to? How will it be found? It is anticipated that the order will lead to a greater access to the mental health review tribunals, but few applicants to mental health review tribunals are able to meet the costs of legal assistance and representation. Can the Minister assure the House that applicants will be eligible for legal aid to meet the costs of representation before the tribunal? Can he also assure the House that lawyers appearing before the tribunal will be drawn from an approved panel of lawyers with specialist knowledge of the order?
I note that there is no reference in the order or in the Minister's speech to a secure regional unit in the Province for mentally disordered prisoners or accused persons. Does the department have any plans to establish such a unit in the Province? If not, is the department satisfied that the health authorities have adequate facilities for the treatment of prisoners suffering from mental disorder? It is an important issue which has been before the House on a number of occasions. We should like to be assured either that the department has the regional unit in mind for the Province or that the facilities are adequate.
The issues which are dealt with in this order are not simply legal ones. The Minister has made the point that they are psychiatric and also psychiatric and social. If one is to understand the order and to implement this order, one must not only know the law but have an appreciation of medical concepts. I can

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certainly sympathise with the people who have asked the department to produce a well written, easily understood guide to the order. That would be helpful for patients, their relatives and staff. We hope that the department will put this in hand. With those comments, we support and approve the order.
Lord Donaldson of Kingsbridge: My Lords, I will not keep your Lordships very long. I want simply to say that this is a marvellous example of the inefficiency of our system of direct rule in the discussion of what happens. It is perfectly inadequate to deal with a matter as important as this without a Committee stage, without amendments and without three or four meetings in this House. I am not going to attempt that. The noble Lord, Lord Prys-Davies, made a jolly good shot, and I agree with most of what he said.
I want to know how much is different from what exists in English law or what is going to exist in English law by the end of the year. For example, if in Northern Ireland certain innovations are being brought in now which will follow in the British Acts, that is all right. If they are entirely different, they ought to be listed separately and we ought to see them. It is too late to do it now and I certainly shall not oppose the order, but I should like the noble Lord to ask his staff to send a short statement saying what is unique and is going to go on being unique to Northern Ireland in this measure and what is simply bringing it up to date with England. If it is simply bringing it up to date with Great Britain, I am prepared to wave it through perfectly happily. I know the abilities and the care taken by the departments in Northern Ireland, and I do not want to do more than have a brief glance at it. If it is bringing in a lot of new stuff, it should be properly debated and at length. I should be very grateful to have an answer to that point. In any case, I shall give the order this rather modified blessing.
Lord Fitt: My Lords, perhaps I may say at the outset that I realise that this is a serious debate. I am indebted once again to my noble friend Lord Donaldson. The noble Lord has talked about the uniqueness of the situation in Northern Ireland and about the innovations that have been brought out in Northern Ireland. It has ever been so. Northern Ireland is unique. Innovation after innovation has been tried in Northern Ireland. Perhaps I may say to the noble Lord who is to reply that this is St. Patrick's Day.
The noble Lord, Lord Prys-Davies, has obviously gone into this order in great detail, which I have not. It is a mental health order and I think it would be generally accepted that the mental health of Northern Ireland in particular and of Ireland in general has been seriously disturbed by the advent of the Anglo-Irish agreement. I wonder whether that has been taken into consideration and whether the effects of this agreement will be contagious to the mental aberrations of this Government and other Governments. I realise that this may not be terribly serious, but it may have a consequence to which we shall have to look in the future.
Lord Broxbourne: My Lords, perhaps I may very respectfully endorse the plea from the noble Lord opposite for a statement of comparison between the
836
law existing in England and Wales and the law embodied in this document. It is no doubt true that if noble Lords will peruse the whole of the order and then peruse the mental health Acts which in operation on the statute book, then they might arrive at the answer. However, I believe that the House will agree that some assistance should be accorded to it in that respect.
6 p.m.
I am bound to say that I am probably a little rusty on mental health law. I see the noble Lord on the Woolsack who took such a prominent part in the proceedings leading to the 1959 parent Act, all those years ago, and who has these matters within his recollection. It was of course a very long and detailed Act and it has since been added to and improved by recent legislation on this subject. If it were possible to relate the large corpus of law in England and Wales to the not inconsiderable document that we are now discussing, then that would be helpful. I am glad to see the noble Lord on the Front Bench opposite nodding his acquiescence. Such would be helpful not only to your Lordships but also to considerable numbers of people interested in this subject from outside.
Having made that general point, I shall take up two specific points made by the noble Lord, Lord Prys-Davies, in his interesting dissertation. If I understood him aright—and if I did not do so then I hasten to say that it is solely my fault—then the noble Lord queried the propriety or wisdom of incorporating a definition of mental handicap within the overall definition of mental disorder and related expressions contained in Article 3 of the order. But again, if my recollection is not too rusty, surely that was the course followed in the parent Act, where we included mental handicap in the overall definition of mental disorder. The noble Lord and the House as a whole will appreciate that the insertion of a comprehensive definition including mental handicap in no way confuses the differences between mental handicap and certain other forms of mental disorder. In fact, it is clearly defined. It means:
"a state of arrested or incomplete development of mind which includes significant impairment of intelligence and social functioning".
That is followed by the definition of severe mental handicap, meaning,
"a state of arrested or incomplete development of mind which includes severe impairment of intelligence and social functioning".
Those are definitions bringing it within the scope of the legislation, but it is of course accepted that they raise very different aspects. I do not know whether the noble Lord can tell the House whether he has received any representations, for example from MENCAP. I regret, for this reason only, that the noble Lord on the Woolsack is on the Woolsack at the present time—because he is the distinguished president of MENCAP. If MENCAP had any reservations or any objections to the proposed course being taken, then no doubt it would have communicated them to ministers. In the absence of a contribution from the noble Lord on the Woolsack, perhaps we may hear more of that matter from my noble friend the Minister when he replies.
One other point arises out of the speech of the noble Lord, Lord Prys-Davies, in regard to proceedings

837
before the tribunal. He queried whether there was any provision within the order for—again, if I understood him aright—the granting of legal aid to assist with costs. That would be a very proper provision. As I read the order, it does not expressly confer such a right. The procedures of the tribunal are dealt with in Article 83 of the order, and are fairly lengthy. Article 83(6) states:
"The Review Tribunal may pay allowances in respect of travelling expenses, subsistence and loss of earnings to any person attending the tribunal as an applicant or witness, to the patient who is the subject of the proceedings if he attends otherwise than as the applicant or a witness".
So far, clearly, there is no provision made in regard to the award of legal aid to a person so appearing. There then follows a surprising exception, in the bracketed part of that provision:
"(other than counsel or a solicitor) who attends as the representative of an applicant".
One is dealing here with very important cases that in a sense affect the liberty of the subject in regard to proceedings for detention and the like. What is the reason for excluding from the provisions of that article counsel or a solicitor? Is it intended to deprive any applicant or any patient of professional assistance, from which some of the complex matters involved might benefit, or what is the reason? I go perhaps a little further than the noble Lord, Lord Prys-Davies, with whose general observations I venture to record my respectful agreement, and ask why it is that such a provision has been inserted.
Again, it is the sort of provision that reinforces the suggestion made by the noble Lord opposite in regard to the desirability of further examination of this complex order and his comment that it would have better followed the procedure of a Committee stage and a detailed examination. Meanwhile, I am sure that the House will be grateful if my noble friend the Minister will deal with the points raised by the noble Lord, Lord Prys-Davies, and by others in this debate.
Lord Prys-Davies: My Lords, perhaps I may be allowed to respond to the noble Lord's questioning. The Assembly consulted widely on the terms of the order. I read the evidence that MENCAP submitted to the Assembly, and I read also their oral evidence in support of the written evidence. It appeared to me that they were saying basically three things. First, they were saying that the mentally handicapped ought not to be considered in an order that deals with mental illness. Secondly, it seemed to me that they were objecting to the definition of mental handicap and to Article 3 of the order. My comments are based on the evidence of MENCAP to the Assembly as I understood it.
Thirdly, it seems to me that the order makes no provision for the availability of legal aid to an applicant who wants to be represented before the tribunal. It appears that Article 83 provides for the expenses which could be paid by the review tribunal. Of course, there is no reference to the expenses incurred in instructing a solicitor or counsel. Therefore, I am anxious to know from the Minister whether the legal aid regulations in Northern Ireland make it possible for applicants to be represented.
Lord Broxbourne: My Lords, with the leave of the House, may I comment further, as the noble Lord,
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Lord Prys-Davies, has been good enough to refer expressly to what I said in my observations? On the second part of what he said in regard to Article 83 we are, I think, wholly ad idem. Indeed, I went a little further than he, so there is no need to comment further on that.
In regard to Article 3, I was most interested to hear what he said about MENCAP, but I remind the noble Lord and the House that the inclusion of mental handicap in the general definition has this very respectable parentage from the Mental Health Act 1959 and it is not equated with mental illness. Indeed, the provisions of Article 3(1) list them quite separately. Mental disorder means:
"mental illness, mental handicap and any other disorder or disability of mind".
That is merely intended to be a comprehensive definition to govern all forms of mental disorder.
Viscount Colville of Culross: My Lords, I apologise to the House and particularly to my noble friend the Minister and the noble Lord, Lord Prys-Davies, for being detained and therefore unable to hear their speeches. The points that I wish briefly to make are, I think, well known to my noble friend Lord Lyell and will not come as a surprise to him.
I should like to start by welcoming the new Mental Health Commission for Northern Ireland. There have been discussions among the various departments concerned, including, I am glad to say, that of Scotland. It is with great pleasure that we shall be welcoming at the Mental Health Commission conference this week the chairman and the secretary of the Northern Ireland commission so that they may see the English equivalent body in operation. It is not quite an equivalent body, as the powers and duties are slightly different, but there will be enough common ground for that to be useful for all of us. In the English commission we have always consorted with our Scottish colleagues, and I hope that there will now be a tripartite operation which will enlighten us all.
The point has already been made about the definition in Article 3. I do not wish to enter into the merits of it because they have evidently already been widely discussed. In any event, I made some of those points a while ago and the Government have not seen fit to alter the definition in Article 3. I see what they are doing. They are using the "mental handicap" definition for the purposes of assessment but not detention. They are also using it for purposes of guardianship. My impression is that they have seen the result of legislation in other parts of the United Kingdom and have decided that they will make minor variations.
Originally I had some concern about this because there has been a fairly substantial alteration in the definitions as between the 1959 and 1983 Acts in England and Wales, not least as a result of the activities of MENCAP and others interested in this respect. Certainly mental handicap as such, as defined in this order, is not even grounds for compulsory detention for assessment any more in England and Wales. However, it occurred to me when I was looking at the draft of this order that those who have to interpret the meaning in the English and Welsh Act of "mental impairment", which is the term now used,

839
might be confused if Westminster subsequently passed this order, which has the effect of primary legislation, containing different definitions but all touching on very much the same area. I suspect, however, on reflection that the context of these definitions in the Northern Ireland order is sufficiently different for there not to be any confusion.
6.15 p.m.
However, I would just say to my noble friend Lord Lyell that in respect of the changes of definitions, my understanding of what happened in relation to people detained for what is effectively mental handicap under the 1959 Act in England and Wales, and who very likely might not have been so detainable under the equivalent provisions in 1983, has been a fairly slow but nevertheless enlightened process. It is not so much that because of the change of definition patients who were previously detained have been instantly set free, but rather that the mental health review tribunals, in reviewing these cases on the regular basis that they do, have taken account of these definitions, with the medical and other evidence available, and probably for this reason, among others, have been discharging people who were previously detained under the 1959 Act.
I hope that the tribunal in Northern Ireland will similarly be astute and will look at these definitions to make sure—I know that the number of patients is very much smaller—that, if any patient is affected by the change in definition so that under this order he or she is no longer within the criteria for detention, that will be reflected in its decisions. That would seem to be a thorough and proper way of doing it; by some organ which has all the information before it.
However, a second point arises on this definition. We now have added yet another variation to the battery of definitions of criteria by virtue of which people may be detained. Your Lordships should do what I did recently and look at the legislation applying in Scotland, the Isle of Man, Jersey, Guernsey, England, Wales and now in Northern Ireland. There is almost no common thread running through the criteria for detention. Each of the jurisdictions has passed its own legislation. In some of the Acts concerned they are comparatively ancient. This means that, no doubt for good reason, we are adding yet another set of criteria to what is already a very confused picture. That may be all very well in Northern Ireland, because the authorities there will, I am sure, be well equipped to deal with it, but there are rare occasions when patients are transferred between the jurisdictions. Indeed, in this order there is a provision for it in Article 134. Similarly, in the English and Welsh legislation there are equivalent provisions which are sometimes used for the transfer of patients from Scotland, Northern Ireland and the islands to hospitals in England and Wales.
What this order contains—which I should have thought is wholly right and ought to be copied elsewhere—is a provision for re-assessment upon receipt of a patient in Northern Ireland from any other jurisdiction. That is clearly sensible from the point of view of the hospital and those who are to look after the patients, but it is also a paramount method of taking
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account of these differences in detainability. My noble friend Lord Lyell, neither in this nor the consequential provisions order, can do anything about the other jurisdictions, but I ask him to suggest to his right honourable friends the Secretaries of State for England, Wales and Scotland—we cannot do anything about the islands because that is not a direct responsibility—that on the list of items for revision in due course, when the primary legislation in England and Wales is looked at again, they should include a provision for re-assessment upon the transfer of a patient.
There is one more archaic reason why this should be done. That is because in the English and Welsh legislation, as in this, when a patient is transferred the detention he is under is deemed to start again in the new country as from the date of the transfer. As a rule, this means that the date for an appearance before a tribunal is postponed for a year however near he may have been to that date in the country from which he came. In turn this means that the opportunity for an independent body to assess the criteria for detention is equally postponed. That will not happen in Northern Ireland under this order because the order deals with it. But it will continue to happen in the other jurisdictions. I hope that my noble friend will be good enough to pass on this message to his colleagues, because I suggest that it is time that was changed to take advantage of this excellent example in the order.
I am sorry to have come in so late. Those are the observations that I wish to make upon this matter.
Lord Lyell: My Lords, I apologise to your Lordships for taking so long to go through the order but, as your Lordships will be aware, it is a very complicated matter. The debate we have had since I sat down shows that there were many points that interested your Lordships and that I am afraid I was not able to cover first time round the course. I hope that I shall have more luck than some of the great jockeys at the steeplechases when I come round the second time, but I shall hang on.
Perhaps I may start with the observations of the noble Lord, Lord Prys-Davies. We were very grateful for his thoughts and his support for the order and the provisions. The noble Lord raised a number of points. First, he mentioned, so far as I recall, the substantial likelihood of serious physical harm, and compulsory admission or detention. As the noble Lord and your Lordships will appreciate, compulsory admission or detention is a very serious step which involves the deprivation of liberty and the restriction of individual rights and personal freedom. That is what I stressed in my opening comments. It can also carry with it a stigma and can generate feelings, which are not altogether helpful, of self-deprecation in the patient. It is therefore right that such powers should be used only where they are absolutely necessary.
The purpose of the new criterion is to provide a clear and objective test for admission or detention. This is based on recent overt behaviour, as I understand it is called. This represents the minimum possible interference with the rights of individuals who suffer from mental disorder. It is still consistent with the need to protect both them and members of the public from serious physical harm.

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It is more restrictive than the health safety in the protection criterion. It does not permit the compulsory admission or the detention of patients who, although not a danger to themselves or anyone else, would benefit from treatment but do not have any insight into their condition and refuse to accept any treatment. I appreciate the concern that doctors feel for these people and the distress which is experienced by their relatives. However, the prospect of benefit from treatment is not considered to be sufficient justification by itself for exercising compulsory powers of admission or detention in order (if we can put it so strongly) to impose treatment.
The noble Lord and others of your Lordships—I think most notably my noble friend Lord Broxbourne—were particularly worried about the definitions of the two new terms which do not appear in the English Mental Health Act of "mental handicap" and "severe mental handicap". The first term, "mental handicap", refers to one of the three categories of mental disorder as defined in the draft order. It covers everyone who has a mental handicap. We hope that the inclusion will ensure that all mentally handicapped people will have access to the help and the protection which will be available under the order. We take one example: the help of the office of care and protection in looking after their property; and above all the protection of the Mental Health Commission.
"Severe mental handicap" is a sub-category of mental handicap. It is included in the draft order to ensure that the most vulnerable group of mentally handicapped people are protected against such things as sexual abuse: or, if they require a limited amount of supervision to enable them to remain in the community, they can be placed under the care of a guardian.
The noble Lord, Lord Prys-Davies, quite rightly raised the question of resources. The changes which were introduced by the provisions of the order will involve the deployment of additional resources in the mental health field. For most of the changes, however, the additional resources required will be—and I say it advisedly—marginal, and they will be contained within existing resources. The major source of additional expenditure will be the Mental Health Commission, which will be funded by the Department of Health and Social Security. I understand that the figure of £200,000 has been made available in 1986–87 for this purpose to cover the commission's costs. Perhaps I should have spelt that out: it is not in the financial year which is about to come to an end.
The noble Lord, Lord Prys-Davies, raised two other points about the separate definitions in England, Wales and Northern Ireland. I am sure that he would agree with me that there is nothing political about these definitions. The noble Lord and my noble friend Lord Colville will certainly know that Scotland also has its separate legislations and views in this field. Certainly the Northern Ireland position was reviewed. It was discussed by the MacDermott Committee and by the local bodies.
The noble Lord, Lord Prys-Davies, had one query which I may be able to cover for him about a medium secure unit. The department has been considering the
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question of a medium secure unit. At one stage, provision was made for the unit in the department's capital development programme. However, I have to tell your Lordships that the constraints of finance prevented an allocation of resources being made for this purpose. But I am sure that the noble Lord will be interested to know that the report of the review committee on the services for the mentally ill, which was set up by the Department of Health and Social Security in April 1980, expressed doubts as to whether containment in a medium secure unit is the best and most efficacious way of treating and rehabilitating severely disturbed patients. The committee favoured the different course of providing appropriate care in high-intensive nursing care units such as are already in various stages of planning in two of the health and social services boards.
As the high-intensive nursing care units are brought into use the department will be in a stronger position, in the face of competing priorities and demands upon the financial resources, to take into account the effectiveness of these units and the priority which should attach to the provision of a hypothetical medium secure unit. We therefore hope that we are going along, as we might call it, parallel paths to that which the noble Lord is seeking. But we hope that this is the most effective way of carrying out this provision certainly in the current financial climate.
6.30 p.m.
The noble Lord and my noble friend Lord Broxbourne also raised the question of solicitors and counsel. I think that the noble Lord, Lord Prys-Davies, put it more succinctly. He called it legal aid. The extension of legal aid to cover representation at the Mental Health Review Tribunals was made in 1983 to include legal representation for all applications to the tribunal under the attractively named acronym of ABWORS—Assistance by Way of Representation Scheme. Previously, of course, legal assistance was available under the green form scheme, and in deference to the noble Lord, Lord Fitt, this is no crack at St. Patrick's Day but was to help patients and other applicants of limited means to prepare their cases. This scheme covered all work carried out by a lawyer, short of instituting proceedings and legal representation at the tribunal hearings. The green form scheme continues but is extended now by ABWORS to assistance given by a lawyer to an applicant in instituting and conducting proceedings, including the representation of the patients. I hope that will go some way, if not all the way, to help my noble friend Lord Broxbourne, and will help the noble Lord, Lord Prys-Davies.
The noble Lord, Lord Prys-Davies, also had a question about the panel of solicitors for the purposes of the Mental Health Tribunal. I understand that the Law Society of Northern Ireland may be looking at this question. I am sure that the noble Lord's comments and my reply will be brought to their attention. I shall certainly see that they are passed on.
The noble Lord, Lord Broxbourne, asked about MENCAP. I see the noble Lord who is now sitting upon the Woolsack and know of his great interest in this particular aspect. The noble Lord, Lord Prys-Davies, also raised a question on MENCAP. There

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was quite vivid talk, over my head. I was interested to note it but your Lordships will be aware that there were representations from MENCAP which criticised the categories of mental handicap during the consultation period. This followed the publication of the draft order as a proposal in April of last year. I assure your Lordships, I assure my noble friend and I assure the noble Lord, Lord Prys-Davies, that these were taken into account along with all the other comments which we received on that order.
I was very grateful to my noble friend Lord Colville for his kind comments and very grateful for his thoughts as far as this particular order is concerned. We know of his great expertise in this field. My noble friend will be aware that Scotland has a provision to allow the reassessment of patients when they are transferred from another country within the United Kingdom. I do not know quite whether the Isle of Man, Jersey, Guernsey and all the points mentioned by my noble friend were covered, but I am advised that Scotland possibly alone has such a provision. I understand it is Section 88, paragraph 1, of the Scottish Act. I hope that will be of partial consolation to my noble friend Lord Colville. I am very grateful to him for what I call his let-out about the Northern Ireland context of these definitions, and indeed some of the aspects of reassessment. We shall make sure that the Mental Health Tribunals are aware of my friend's points. I shall certainly bring my noble friend's points to the attention of my honourable friend as far as the Mental Health Tribunal is concerned. That is as far as I can go this evening.
No doubt one or two points of a more detailed nature have been missed, but I hope I have been able to satisfy your Lordships with the answers I have been able to give. As I warned when I stood up for the second time, this was something akin to a ride round a major steeplechase course. I think I have negotiated it.
Lord Donaldson of Kingsbridge: My Lords, could the noble Lord indicate whether he can answer my request to let us have a statement in due course—not to hold up this order—showing us the difference between legislation in England and Wales, which is the basic legislation, and the new legislation in Northern Ireland?
Lord Lyell: My Lords, I do apologise; I should have taken that up. That point was also mentioned by my noble friend Lord Broxbourne. I am not able to say definitely whether I can get what might be called a simplified Minister's guide to this. May I look into this and see if there is a chance of having a guide, or if indeed we can find simplified notes of sorts so that what we call the layman might have some idea of the provisions of the order. Of course, noble Lords will be aware that many of the provisions in the order will be in the field of my noble friend Lord Broxbourne and, indeed, my noble friend Lord Colville. It will be much more of a lawyer's field, and I have covered the point of legal aid. If I may look into his query and see if it is feasible to provide some simplified guidance or notes, would that satisfy the noble Lord tonight?
Lord Donaldson of Kingsbridge: Yes, my Lords. My difficulty about this is that I think it is absolutely
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wrong that we should pass legislation of this kind, which is extremely complicated, without the proper attention which we should give to it if it were English, Welsh or even Scottish legislation. For that reason, as I said, I think the system by which we deal with this sort of thing here is inadequate without further preparation. I know that the noble Lord, Lord Broxbourne, and the noble Lord, Lord Renton, know all about this. I happen not to. I know about some things that they do not. As this has nothing to do with it, it seems to be absolutely wrong that legislation as complicated as this should be carried without a direct comparison with what is going on in England and Wales.
Lord Lyell: My Lords, if I may finally reply, I have two points. Certainly my noble friend Lord Colville stressed that this order had an input—and certainly I had stressed this—from all round the United Kingdom. Secondly, I do not know if the noble Lord took on board all the points made by the noble Viscount, Lord Colville, but I found that my noble friend did explain these aspects very clearly.
As for the other aspects raised by the noble Lord, Lord Donaldson, they are in the generality of all legislation that we take in this way in your Lordships' House, and I am sure that he will accept that this is an imperfect situation in which perhaps tonight's order is not the best example. However, I take his points and I hope that he will accept that I will see if there is anything that I can do. I find it very interesting, and it was made even more interesting by my noble friend Lord Colville. I should like to thank him for his kind words of support for what we are trying to do.
With that, I hope the House will accede to our giving this order a fair wind.
On Question, Motion agreed to.

Mental Health (Northern Ireland Consequential Amendments) Order 1986
6.38 p.m.
Lord Lyell Lord Lyell rose to move, That the draft order laid before the House on 3rd February be approved. [10th Report from the Joint Committee.]
The noble Lord said: My Lords, I beg to move that the Mental Health (Northern Ireland Consequential Amendments) Order 1986, a draft of which was laid before your Lordships' House on 3rd February this year, be approved.
A number of Acts of Parliament applying solely to Great Britain or, indeed, to the United Kingdom as a whole require to be amended as a result of the changes introduced by the Mental Health Order which we approved a few seconds ago. These amendments are of a purely consequential nature and are contained in a separate enactment because the law which is being amended falls outside Northern Ireland's legislative jurisdiction.
I hope your Lordships will accept that these amendments are indeed consequential. With that, I beg to move.
Moved, That the draft order laid before the House on 3rd February be approved.—(Lord Lyell.)
On Question, Motion agreed to.

Overseas Holidays: Market Restrictions
6.40 p.m.
Lord Teviot Lord Teviot rose to ask Her Majesty's Government whether they approve of a closed shop in the sale of overseas holidays where this cannot be proved to be exclusively for the benefit of the consumer.
The noble Lord said: Underlying this Question is action being taken by the Association of British Travel Agents—ABTA—to the detriment of British holidaymakers, its own travel agent members, shipping companies, coach operators and, it seems to me, the association itself. Your Lordships will hardly need reminding that the holiday industry is volatile. It sells dreams—dream holidays—and holidays are often the biggest purchase a family makes each year. As well as being the biggest purchase, it can bring the greatest pleasure, not only the holiday itself but the anticipation of it and the planning of it. Looking through those brochures in dark, miserable winter days gives one great pleasure and joy. One can see oneself on a beach in the South Seas, until of course when the bills come in you feel that what remains in your pocket would be more befitting a week in a holiday flat in Clacton. So holidays are important. They should be protected from the failure of holiday organisers.
It is to ABTA's credit that it took steps as far back as 1965, following the Fiesta failure, to put its own house in order. It launched what is called Operation Stabiliser. One has to recognise that, through ABTA's initiative, the public interest has benefited even more than self-interest. However, that element of self-interest has always been a potential danger to the efficient self-regulation of the industry. It has caused problems within the membership of the association, and from time to time some blood-letting has been necessary. An essential element in Stabiliser's protection of the public is the financial safeguard provided by a bonding system, while the need to deal with customer complaints in an objective way is also recognised. The trouble is that, as a basis for this protection, ABTA felt the need for a closed shop. When it introduced Operation Stabiliser in 1965, it required its travel agent members to sell only the holidays packaged by its so-called tour operator members. Similarly, the operators were only to sell through ABTA members. That included their own direct sales.
From the outset, it was recognised that there were certain other holiday firms that could not logically be excluded from the holiday choice made available to the public through the travel agencies. These were the coach companies providing overseas tours—at that time under statutory licences—and also the shipping companies with their cruise and ferry services. Both these classes of operations were at first given dispensations from Operation Stabiliser, and the shipping companies, members of the Passenger Shipping Association, still have such a dispensation, although it is now under threat. In the case of the Bus and Coach Council coach operators, however, ABTA decided to make them an intrinsic part of Stabiliser by enshrining their position in its own articles of association. Now it wishes unilaterally to reverse this action. The difficulty is that as Stabiliser is
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undoubtedly a restrictive trade practice, it was referred to the Restrictive Practices Court in 1978. The Confederation of British Road Passenger Transport, now known as the Bus and Coach Council, or BCC for short, was a party to that action. In the judgments of the court in 1982 and 1983, it is made clear that the members of the CPT licensed continental section are, along with all members of ABTA, parties to the Stabiliser agreement.
The dispensation for members of the Passenger Shipping Association was also noted. It is apparent that these sensible relaxations in the closed shop principle were major factors in the decision of the court that it should not rule that Stabiliser was against the public interest. The court specifically affirmed that ABTA should not use its closed shop in a way that would prevent any suitably protected holidays being sold to the public by its members. The court went so far as to say that in considering dispensations from Stabiliser under Article 13(7)—a procedure that was insisted upon—ABTA must not consider any tendency to weaken, or to fortify, its supervisory functions. Ironically, it seems to be on these clearly prescribed grounds that ABTA is now seeking to force coach operators and shipping companies into its membership by cancelling their present rights, although the court further adjudged that to act as a recruiting sergeant would not be a proper use of its discretion.
ABTA speaks of rescinding dispensations, but that is another flaw in its reasoning because, as already explained, the coach operators do not have a dispensation. They are in fact parties to the Stabiliser agreement. ABTA does not seem to realise that it can only be heading straight back to another hearing before the Restrictive Practices Court by making such a fundamental change in the agreement that it accepted. What is more, it is hardly likely to give a very convincing account of its stewardship when it is choosing to ignore the very specific advice given to it by the court.
Another factor which ABTA chooses to ignore is the position of Stabiliser under Article 85 of the Treaty of Rome. This article prohibits
"as incompatible with the Common Market: all … decisions by associations of undertakings … which may affect trade between Member States and which have as their … effect the prevention, restriction or distortion of competition within the Common Market and in particular those which"
there follow (a), (b) and (c); and then (d) states:
"apply dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage".
One would think that, after a few minutes studying those words, ABTA would recognise that it is placing more at risk than the loss of a relatively small number of holiday sales. It is with these factors in mind that one turns to the Government and asks them to give some clear indication of the public interest which has until now been pretty well served by the Stabiliser agreement. One can only wonder whether the custodians of the agreement have lost their way, overwhelmed by a self-imposed responsibility for protecting the public from every Tom, Dick or Harry who in any way sells an overseas holiday. They claim to believe that the public is too stupid to choose

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between their own bonding scheme and those of other organisations which they now see as competitors.
Since the trouble started in the 1960s, the consumer protection schemes provided by the Bus and Coach Council and the Passenger Shipping Association have never once been called into action. ABTA's is the only scheme that has ever had to rescue holidaymakers let down by its own members. Let me stress, however, that it did a very fair job of this and gained much experience. But is it not a great irony that ABTA should seek, after 20 years, for no valid reason, to evict those with a clean bill of health from the Stabiliser agreement in which they had participated in the public interest?
Finally, let me say that the fragility of ABTA's arguments may be explained by the line taken in private by certain of its members, which is clearly to protect their own sales from the success of others. As one said, self-interest has always been lurking in the wings since Stabiliser has been on stage. I can tell those of your Lordships who may ask that every effort has been made by the Bus and Coach Council and by the Passenger Shipping Association to avoid this head-on clash. Yet diplomacy seems to have been interpreted by ABTA as weakness. This has led it into ill-considered actions without stopping to weigh the consequences for itself. Fortunately, it is not too late to bring it back from the brink. I am delighted that it is my noble friend Lord Brabazon of Tara who will be replying to this debate as an Unstarred Question some 18 months ago was his first. I hope that he will be able to put matters in a perspective that will yet lead to an amicable settlement of this totally unnecessary dispute and will allow holidaymakers both protection and choice when they next visit their travel agent.
6.50 p.m.
Lord Williams of Elvel: My Lords, I hope not to detain your Lordships very long. It is quite right of the noble Lord, Lord Teviot, to raise this matter in his Unstarred Question. I have had a slight disappointment, because at one stage in his speech I had hoped that we would have a debate about the relative merits of South Sea islands and holiday packages, but I find that we now come to the rather narrow issue of the dispute between ABTA and the BCC, which is the point on which the noble Lord concentrated.
There is a very strict and slightly legalistic answer which the Government could make to the noble Lord's initial Unstarred Question which is:
"whether they approve of a closed shop in the sale of overseas holidays where this cannot be proved to be exclusively for the benefit of the consumer".
The Government, through their legislation, are bound to take the public interest into account, and the public interest has been defined on many occasions by legislation.
However, if I may, I want to go further into the noble Lord's argument. The noble Lord is certainly right that the travel association, ABTA, has done some excellent work in what I would call the general principles, which we on this side of the House would support when it comes to overseas travel, which is the
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essential protection of British citizens and British residents travelling abroad—the travelling public.
Since Stabiliser was set up in 1965 there have been several occasions of travel companies going bankrupt and some quite extensive horror stories of people being stranded. If it had not been for Stabiliser and the bonding arrangements of ABTA, I think we would all agree that the situation would have been much worse than it was.
Our second principle is that the members of the BCC, the bus and coach operators, should receive fair treatment. It is in trying to draw a balance between these two general principles that the difficult area arises. Essentially, the matter arises out of a decision of the Restrictive Practices Court in 1982 which was called upon by the Director General of Fair Trading to judge on Stabiliser when, as your Lordships will remember, in 1976 the restrictive practices legislation was extended to apply to services as well as to manufactured goods.
The question to which the court addressed itself, at the request of the director general, was whether Stabiliser was in the public interest. After, I think, a six-week hearing and a great deal of argument put forward in all directions, as the noble Lord, Lord Teviot, said, the court decided in favour—if I may put it like that—of Stabiliser. However, there were certain conditions: that there should be codes of conduct, the right of appeal, and so on. The paramount interest of the Restrictive Practices Court in arriving at that decision was consideration of the public interest.
The noble Lord is certainly right in saying that Article 63 of the ABTA constitution built in dispensation to one section of the BCC members: those who were already in Stabiliser. Under that article they had—and I shall use the term in spite of what the noble Lord said—automatic dispensation from the general ruling of ABTA, the general ruling being that if you want to belong to the Stabiliser scheme and you want to sell through ABTA agents, you must be an ABTA-registered tour operator and bonded through ABTA. Therefore, dispensation which partially existed under Article 63 for some of the members—I think they are called section members—of the BCC, is now proposed to be removed.
The resolution that is being brought forward at the ABTA general meeting is Resolution 9, which is designed to rescind Article 63 and to put all the people—the operators who hitherto had enjoyed dispensation under that article—into the same category as anyone else who wishes to apply for dispensation from the ABTA rules as normally applied. I note that dispensation is still available under Article 13(7), with a right of appeal under Article 13(8). That is to say, anybody can apply for dispensation, and all ABTA appears to be doing is saying to these people who had a slightly privileged existence under Article 63, "I am very sorry, you can no longer enjoy this privilege if this resolution is passed. You must apply in the normal way for dispensation; there is a time limit imposed during which that application can be made".
I have a certain lingering sympathy for ABTA in some of these matters because, if anything goes wrong, it is always ABTA that gets blamed. When there is a

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failure of any sort concerning tour operators—perhaps people are stranded on whatever South Sea island it might be, however desirable that might be—it is always the chief executive of ABTA who is called upon to answer questions on television. The serious point which ABTA makes about this is that it is very difficult to accept the responsibility in the public eye for supervising and being seen to supervise tour operators when there is no power to do so. It is a general point which I think covers a wide range of organisations of this nature. It may be the fault of the tour operator; it may be the fault of ABTA; it may be the fault of the people who provided the bond in the first place. Nevertheless, in the public eye I believe that ABTA is seen to be the major supervisor of tour operators in general.
Lord Teviot: My Lords, I am most grateful to the noble Lord for giving way. I hesitate to intervene, but the noble Lord mentioned that he has sympathy with ABTA in this area because it thinks it has to carry the can. I do not know whether the noble Lord used those words but I believe that that was his meaning. I would enirely agree with what the noble Lord says, but it should be pointed out that one would have sympathy for ABTA, especially if there had been cases. However, as the BCC and the PSA have had clean bills of health for 20 years, I can see no reason, and I would ask the noble Lord to take that point into account.
Lord Williams of Elvel: My Lords, I am very grateful to the noble Lord, Lord Teviot, for his intervention. Indeed that is the case. I was talking as a matter of general principle. I think I said that if generally, across the board, there were any such failure—and I am not claiming that there was—ABTA would be the people who would be regarded, certainly by the media, as being the governing association, and, I think quite properly, the chief executive of ABTA would be required to answer the questions of newspaper and television reporters.
The question which arises, which your Lordships have to determine and which the noble Lord, Lord Brabazon, has to determine when he answers the Question, is whether this is a proper matter that can be debated in your Lordships' House. As there has been a judgment of the Restrictive Practices Court, I have no intention of commenting on that judgment and of stating whether I think it was a good or a bad judgment. I understand that the director general was rather disappointed in the judgment, but that is his problem and not mine. It would be quite improper for me to comment on that.
It is perfectly true that the passing of Resolution 9 and the recision of Article 63 could create a change of circumstances under which the Director General of Fair Trading might feel it appropriate to re-open the issue in front of the Restrictive Practices Court. That no doubt is a question which is being addressed by the director general and he will come to his own conclusions, as is his statutory obligation. He will or will not ask the Restrictive Practices Court to look at the matter again. It would be very interesting if the Minister has any views, opinions or knowledge about
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the attitude of the director general in this particular instance.
As the noble Lord, Lord Teviot, said, it is also true that there may be a contravention of Article 85 of the Treaty of Rome, which the noble Lord quoted in full. It may be that the Fourth Directorate General in the Commission, which looks at competition matters, will look at this and say that there is a prima facie violation of this article, that they wish to take the matter further and will take it through the appropriate procedures. It is not for me to say whether that is right or wrong; that is their business. Again, I would be very interested if in his reply the noble Lord, Lord Brabazon, has a view or information as to whether the European Commission and the Fourth Directorate General will look rather closely at this problem. That would be interesting.
The point that I really wish to make is that in our view the legislation for dealing with this type of problem is already in place. There is a Fair Trading Act—the Fair Trading Act 1973. There is an Office of Fair Trading. There is a lot of restrictive practices legislation and there is a Restrictive Practices Court. We would believe that the proper place for these matters to be fought out would be in those places and not, as one might believe, between government and Opposition in your Lordships' House.
If the legislation is to be changed, that is certainly something which we would want to look at and discuss and have a normal debate on. But while the legislation is there, whatever we may think about the legislation, it is, in my view, proper to leave the matter to those who are competent to operate that legislation in the way they have been doing up until now. I therefore would simply say to the noble Lord, Lord Brabazon of Tara, who is replying to the Question, that so far as we are concerned we are, as it were, neutral on this issue. We believe that the right place is in the Restrictive Practices Court if that is the director general's intention, or in the European Court if that is the intention of the Commission, but we would not wish to take sides because we think the legislation is there and it would be improper for us to do so.
Lord Carmichael of Kelvingrove: My Lords, I should like to speak briefly on this Question. I am most grateful to the noble Lord, Lord Teviot, for his initial explanation, and also to my noble friend Lord Williams of Elvel for his further clarification of what is quite clearly an unclear matter and a quite difficult subject. My concern is largely with whether this will affect the ordinary holidaymakers who want to go abroad by coach, where most of the problems seem to arise in terms of the failure of companies. I understand from some information I have been given that, for instance, this year there will be over 1 million people booked through the bonded holiday arrangements of the Coach Council, and they will book through ABTA travel agents. Will this cease now, or will the Bus and Coach Council require to pay some fee to take part in the ABTA arrangements for insurance purposes should anything go wrong with the holiday?
The reason I raise this matter is that from the little knowledge I have been able to glean—although I have been approached by a number of people about the subject—it seems that while the courts felt unable to rule that this scheme was against the public

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interest—that was the stabiliser scheme, and even more so the moving of Resolution 9 when the ABTA annual general meeting comes—they did make clear that it was important that ABTA's decisions should be based on the public interest and not on its members' own particular interests. I just wonder whether ABTA is in some way trying to build a fence around itself and give itself something that would ultimately be against the public interest.
I agree with my noble friend Lord Williams of Elvel that ultimately the machinery is there for decisions being taken by the Restrictive Practices Court or the European Court in the competition terms if they so wish. But if there is uneasiness about the working of some new regulation about to be brought in—which obviously has a certain amount of contention in it because the original decision of the Stabiliser caused a bit of confusion, and Resolution 9 seems to me as though it is going to tighten that up and make it even more of a closed shop (though I may be wrong there)—while the machinery may be there, it does not do any harm to raise this at an early stage in your Lordships' House so that, if nothing else, there can be a rethinking of the spirit of the decision as well as the actual words of the decision.
7.4 p.m.
Lord Brabazon of Tara: My Lords, as my noble friend Lord Teviot reminded us, the last time I answered an Unstarred Question of his was some 18 months ago on the Buses White Paper. Judging from my noble friend's activities during the passage of what is now the Transport Act, I regretfully have to come to the conclusion that what I said that evening may not have been to my noble friend's complete satisfaction. I hope I can do a bit better this evening.
My noble friend has by his Question brought to the attention of your Lordships' House tonight a matter which is worthy of close consideration. It is a matter of concern to those who provide holidays, to retailers who sell those holidays on their behalf and, most importantly, to the 9 million people in this country who, each year, commit considerable sums of money to the travel industry in good faith and in the reasonable expectation that the travel, accommodation and other arrangements for which they have paid will be provided in due time.
It is, I am sure, common ground that the alteration or cancellation of holiday arrangements has been an all too frequent source of frustration and disappointment to holidaymakers. The risk that a holiday company or a travel agent will collapse leaving the holidaymaker with no compensation and perhaps stranded abroad has been an even greater source of worry which consumers in a modern society should not have to bear. Let me say at the outset therefore that the Government greatly welcome the efforts made by the travel industry in recent years to provide holidaymakers with the greater certainty and security which they deserve.
The Government believe that overseas holidays are a good example of where voluntary action by the industry can, and should, achieve a high level of consumer protection. The codes of conduct developed by the Association of British Travel Agents, ABTA, in
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consultation with the Office of Fair Trading have done a great deal to reassure holidaymakers, as noble Lords have already mentioned.
This is not the time to recall all that the industry has done in recent years to improve "its service to consumers; but it is perhaps relevant to tonight's debate to observe in particular that the bonding arrangements to which both tour operators and retail outlets within ABTA's membership contribute now offer consumers a comprehensive and substantial measure of protection against the failure of holiday companies and travel agents. I would not wish to overlook in my remarks the parallel efforts being made in this direction by other bodies, such as the Bus and Coach Council, the BCC and the Passenger Shipping Association.
Naturally, there will always be room for improvement. I understand that there is still a substantial volume of consumer complaint to the Office of Fair Trading about package holidays. This possibly reflects the very considerable amount of foreign travel that now takes place; and consumers have quite understandably grown to expect a progressively higher standard of service from the British travel industry. There is clearly no scope for complacency. In this context, the Government particularly welcome the recent announcement by ABTA that it will further strengthen its code of conduct to provide safeguards and compensation for consumers who are inconvenienced by last minute changes to the travel or accommodation arrangements made for them.
However—and this brings me to the focus of my noble friends concern—the travel industry's laudable efforts at self-regulation have given rise to a degree of conflict between the equally desirable aims of open competition and consumer protection. On the one hand, it is clearly in the interests of consumers that there should be a wide choice of holidays and that the market should be open to new tour operators and travel agents, bringing with them fresh ideas and innovative methods.
On the other hand, the operation in the market of holiday companies or travel agents not subject to disciplines capable of giving holidaymakers adequate protection against shoddy service or financial failure is not of benefit to consumers and is bound to undermine confidence in the travel industry generally. As my noble friend reminded us, ABTA's solution to this problem was to introduce the arrangement known as Stabiliser, under which tour operators within ABTA are prohibited from selling holidays through retail agents who are not also members of ABTA, and ABTA travel agents may not sell foreign holidays which are not promoted or organised by tour-operator members of the association. This ensures that in any dealings with ABTA companies consumers can be sure of services governed by ABTA's codes of conduct. But it clearly limits the opportunities for non-ABTA holiday companies and can be fairly described as a closed shop.
The question of where the balance of public interest lies in such matters is a complex one, and under the Restrictive Trade Practices Act 1976 it is a question which must be determined by the Restrictive Practices Court. The rules and codes of conduct of ABTA were

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referred to the court by the Director General of Fair Trading in 1982. The court was by no means satisfied that every restriction contained in those rules and codes was in the public interest, and a number of provisions were amended or abandoned, as the noble Lord, Lord Williams, reminded us; but the court was satisfied that the Stabiliser arrangement itself was not contrary to the public interest. It took the view that without such an arrangement the commitment of ABTA members to the association's bonding arrangements and their adherence to other disciplines laid down by ABTA would decline to the obvious detriment of consumers.
Nevertheless, the powerful market position in which Stabiliser places ABTA and its members has been fully recognised. In its judgment, the court placed emphasis on the existence, under ABTA's rules, of a procedure which would permit tour operators or travel agents not in membership of ABTA but operating to similar standards, to apply for a dispensation which would enable them to market overseas holidays through or on behalf of ABTA members. The court further emphasised that the paramount criterion for the consideration of such applications should be the consumer interest and not simply the strengthening of ABTA's supervisory role. The court was quite specific about this; it stressed that the ABTA council should not be acting as a recruiting sergeant for that would be an improper use of the discretion. It was with this in mind that the Director General of Fair Trading urged ABTA to extend its fully independent appeals procedure to cover requests for dispensation, and this, too, was an important factor in the court's decision.
The Government believe that the judgment of the Restrictive Practices Court provides a basis on which a degree of competition consistent with the need to protect consumers can be maintained in the market for overseas holidays. The responsibility for ensuring that the judgment is being implemented correctly rests with the Director General of Fair Trading. If the circumstances on which the court has based its judgment change in a material way it is open to the director general to seek leave to apply to the court for a variation of its decision.
My noble friend Lord Teviot has raised a particular problem concerning the Bus and Coach Council, and has fully explained the background. I believe that the formal relationship between the BCC and ABTA is a matter which the two organisations must determine for themselves. What is important is that one way or another the BCC and those of its members who are not also ABTA members should have a timely
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opportunity to make a case for their continued dispensation from Stabiliser and that such a case will be considered strictly according to the consumer interest criteria emphasised by the court. If the BCC's application is unsuccessful it may of course invoke the independent appeals procedure laid down in ABTA's rules. I believe that these procedures should be sufficient to safeguard the consumer interest in this matter. However, if, having invoked all the safeguard procedures available to it, the BCC considers that Stabiliser is nevertheless having an effect not envisaged by the court when judgment was made, I am sure that the Director General of Fair Trading will take those views into account in deciding whether there has been a material change of circumstances such as to require the court's reconsideration.
My noble friend and the noble Lord, Lord Williams, both mentioned the European Commission and asked whether that would be looking at this question. I am aware from press reports that a complaint has been made to the competition directorate of the Commission, and I am sure that it will consider the matter carefully. EC competition rules are likely to apply to Stabiliser in so far as it may affect trade between member states. It is for ABTA and its members to ensure that they are not in breach of those rules, but the competition rules clearly recognise that certain agreements which affect competition cannot at the same time be of benefit to consumers. I am sure that the EC Commission, like the Restrictive Practices Court, will take that into account in considering Stabiliser.
The noble Lord, Lord Carmichael, asked me whether holidays booked this year would be affected in any way. The arrangements governing the sales of holidays during the coming season will not be affected by the current dispute between BCC and ABTA. The bonding arrangements will protect the holiday maker.
In conclusion, I should like to thank my noble friend Lord Teviot for bringing this matter to the attention of your Lordships' House, and the noble Lords, Lord Williams and Lord Carmichael, for taking part. This debate has served to underline that the balance between consumer protection and free competition in the market for overseas holidays is a delicate one, and I am confident that, in seeking to ensure that the judgment of the Restrictive Practices Court on this matter is upheld, the Director General of Fair Trading will take careful note of your Lordships' concern.
House adjourned at sixteen minutes past seven o'clock.