Local Government Finance Bill

HL Deb 30 June 1988 vol 498 cc1734-63

5.4 p.m.

Consideration of amendments on Report resumed on Clause 12.

Lord McIntosh of Haringey moved Amendment No. 49:

Page 9, line 14, at end insert— ("(6A) For the purposes of facilitating the calculation of the personal community charge under this section, the compilation of the register under section 6 above, and the collection of the charge under sections 22 and 24 below, the Secretary of State shall make a determination under section 91(3)(d) below as to the amount of grant he proposes to pay to receiving authorities in reimbursement of 80 per cent. of the actual cost incurred".).

The noble Lord said: My Lords, I venture to claim that Amendment No. 49 is a proper Report stage amendment. In Committee we considered the cost of collection of the community charge and sought to persuade the Government that because it would be so very much higher than the cost of the rating system, the charge of setting up and administering the system ought not to fall on the local authorities, who are hardly responsible for its introduction, but on central government which is wishing the system upon them.

We urged that course on the best evidence available to us. At that time the report of the Government's own consultants, Price Waterhouse, had not yet been published. To some extent, therefore, we were speaking speculatively about the cost of collection of the community charge. The best evidence we had was contained in the Explanatory and Financial Memorandum to the Bill as it appeared before the Committee, which said: It is estimated that the total additional cost to local authorities in a full year will be in the range of £160 million to £200 million. Expenditure in the range of £70 million—£90 million is expected in 1989–90 on the establishment of the register and preparation of new billing and collection systems".

The Government must be grateful that it is the convention of the House that the Explanatory and Financial Memorandum is not repeated when the Bill is reprinted, as amended in Committee, because those figures look pretty absurd now not only in the light of the Price Waterhouse report but also of the calculations that have been made by the local authorities themselves.

I take it that the Government will not deny that instead of a figure of £70 million to £90 million for implementing the new system, the figures from Price Waterhouse are £38 million in 1988–89 and £325 million in 1989–90—a total of nearly £363 million. With the system in place the cost in a full year was said to be £160 million to £200 million. The estimate now is that the cost will be £435 million.

Those are huge figures, enormously greater than anything ever admitted before. It is not even as though the Government had not had an opportunity to revise their own figures. The local authority associations themselves took the precaution of carrying out surveys among authorities which I was able to present to your Lordships' Committee and which showed that the costs would be very much greater than the original estimates. Yet, speaking at Second Reading, the Minister said that the unit cost of collection of the community charge would be no greater than the unit cost of collection of the rates. What he meant by that was that the cost per name on the register would be no greater than it is for the rates; in other words, the cost would increase by the amount by which the length of the register (the number of people on the register) is greater for the community charge than for the rates. In other words, he admitted that the total cost of the community charge would be very much higher but argued that the cost for entry would be the same.

Even that prediction has been repudiated by the Price Waterhouse report which indicates that the cost of maintaining the register will be £1.50 per head and that the other costs involved in the community charge will be £9.20 per head, making a total of £10.70 compared with the sum of £8.50 per rateable hereditament under the rating system. So even the more recent figures which the Government gave to this House have now been disproved by the Government's own consultants.

As regards the rebate system, I suspect that even the calculations of Price Waterhouse are out of date because of the changes, some of them very welcome, that are taking place to the rebate system as it proceeds through your Lordships' House. According to the calculations, the rebate system would cost an extra £81 million to administer, whereas the rates rebate system we have at present costs £65 million. In addition to that—and there are many local examples which are pouring into us day by day—there will be huge demands on additional staff. Price Waterhouse estimate that an additional 14,000 to 18,000 town hall staff will be needed to run the new systems.

It has been a favourite sport of Members of this House on the government Benches to deplore the extravagance of local authorities. There are many noble Lords, some of them present today, who have taken great delight in proclaiming that local authorities are extravagant and reckless, that they do not care about the pockets of the ratepayers, and that it is to control this extravagance that these measures have to be introduced. Can we imagine anything more extravagant than the expenditure of all this additional money, not to produce a single new benefit for a single individual but simply for administration of this cumbersome and unjust system? Can there be any greater example of extravagance than that which is now being forced down the throat of the British people by this Government?

I have to ask whether the Government have fully appreciated the enormity of what they are doing in putting forward this system, and I have to ask some specific questions about the way in which they are doing it. The first question, obviously, is: why did they get it so badly wrong? Why have their estimates been so patently disproved by the Price Waterhouse calculations? Why could those sums not have been done before the Bill was introduced? Would it not have given pause to any sensible government, and an opportunity to think again about this madcap system?

If it is true, as Price Waterhouse say, that the set-up costs are going to be as great as this, are the set-up costs—leave the running costs on one side for the moment—going to be met in full, and are there going to be adequate capital allocations for the accommodation and the computer systems, and so on, that will be needed by this additional staff? Indeed, in the light of the fact that Price Waterhouse say that most authorities find it difficult to recruit suitably qualified and experienced personnel for senior posts—and this is especially true in London and the South-East—are the Government confident that we are going to find the additional staff?

Are the Government satisfied indeed that the Price Waterhouse report is even now adequate to represent the true costs of the community charge system? They have assumed, for example, that there will be no specific problem of evasion of the tax, but all the evidence from taxes of this kind—like the car tax and the TV licence tax—is that there will be a significant level of evasion, and that this level of evasion will not only put up the community charge for those who do not evade the charge but will also increase the administrative costs for local authorities.

Price Waterhouse do not appear to make any provision for the special difficulties of collection in inner city areas, but we know that electoral registers are badly incomplete in inner city areas. We know that the defects probably run at a level more like 17 per cent. or 20 per cent. compared with less than half that in other parts of the country. If that is true for the electoral register, is it not also going to be true for the community charge register?

So far as we can tell, Price Waterhouse have made no specific provision for the cost of collecting from students, and yet we have seen from the debates in this House on this Bill that the system proposed for students, with the establishment of certification officers and all this paraphernalia in the universities and colleges, is going to be particularly difficult, and therefore expensive. Price Waterhouse, so far as we can tell, have not made any specific provision for the cost of staff training, although they say that there will be a need for an extensive training programme for staff. If that has not been taken into account, then the true figures for the cost of the community charge are going to be very much higher.

Price Waterhouse have not made any allowance for the kind of publicity that is going to be necessary. We understand that the Government are raring to go and champing at the hit with publicity for the community charge as soon as this Bill receives Royal Assent. That of course will be a charge on the taxpayers and not on the community charge payers, but it will be an equally unjustified expense, an equally unjustified burden, on hard-pressed taxpayers.

Finally, the consultants do not appear to have made any estimate of the costs of the additional number of people who are likely to be paying by instalments. At the moment only 20 per cent. to 30 per cent. of rates are paid by instalments, but it seems highly likely that far more people will wish to pay by instalments when the new community charge comes into effect.

We come to the wording of the amendment itself. I have discussed the need for it and now I come to the actual wording. What we propose is a reasonable compromise. Instead of saying that the whole cost of the administration of the community charge should be borne by the Government in the form of increased grant—because I understand, although I did not agree with them, the points that the noble Earl made at Committee stage when he argued that full reimbursement would not encourage local authorities to be economical and prudent in their administration of the community charge—we say that there should be a half-way stage between the 60 per cent. that is now likely to be proposed and the full payment. We are proposing reimbursement of 80 per cent. of the actual cost incurred.

That leaves a sufficient burden on the local authorities and on the community charge payers to ensure that they will do their best—with the benefit, I must say, of the best practice recommendations in the Price Waterhouse report—to see that the system is as economical as possible. But it also reflects the fact that, with the best will in the world, with the best practice, with the most efficient system, with the greatest of good fortune on staff training and staff availability, the system is going to be enormously more expensive than the rating system, and that is the fault not of the local authorities but of the Government themselves.

I suggest to the House that it would be right to make the concession proposed in this amendment, to recognise the fact of the burden on the community charge payers and to recognise the resposibility of the Government for that additional burden. I beg to move.

5.15 p.m.

Lord Boyd-Carpenter

My Lords, the noble Lord, Lord McIntosh of Harringey, during the first three-quarters of his speech devoted his attention to indicating his dislike of the community charge system. Your Lordships have discussed this at considerable length at earlier stages of the Bill and it does not seem to me that those broad, important questions arise at all on the amendment that he is proposing.

The noble Lord's amendment relates to the distribution, as between central and local government, of the costs of setting up the new system. It will surprise no one with any experience of administration if the costs of setting up a new system considerably exceed the original estimates. I think I know of no major changes in the administration of affairs in this country where that has not been the case. That of itself, I say to the noble Lord, is no argument against the broad decision of policy which your Lordships' House has already approved. That there will be some costs is clear. Therefore the only real question for your Lordships at the moment is the much narrower one as to what exact percentage of the costs of setting up the new system should fall on the local authorities and what percentage should be carried by central government.

The first point that I think occurs to anyone who has any experience of administration is that unless a substantial part of the costs fall on the local authorities who are actually doing the collecting, there is no guarantee that this will be done as economically as possible. Where one draws that line exactly is no doubt a matter of genuine difference of opinion. To talk of being liable for only 20 per cent. of the costs of the whole operation seems to me a most dangerous suggestion. When one is doing something administrative and has to pay for only one-fifth of it, there is less incentive to exercise rigid economy than if one is paying the whole or a substantial proportion of it. After all, it must be remembered that Parliament having decided, as it will have, that the new system shall take effect, the setting up of the proper administrative system in each local authority area is very much in the interests of that authority because a quarter of its revenues will depend on the efficient working of the system. It is the local authority that stands to gain or lose most according to how well that job is done.

It seems to me therefore that the noble Lord, Lord McIntosh of Haringey, is allowing his immense and obvious distaste for the whole Bill to colour his normally acute judgment on matters of local government finance. I add only one comment: in the light of the many discussions that we have had in the House, particularly with the noble Lord taking the lead, it is cheering and encouraging to hear him expressing anxiety about excesses of local government expenditure.

Lord Ross of Newport

My Lords, I strongly support the amendment so ably moved by the noble Lord, Lord McIntosh of Haringey. It comes a bit rich at a time when the Government have had to admit obtaining a report from outside experts that the cost of collection will be at least double their original estimates. We have thrown at us constantly the inefficiency of local authorities. In the Price Waterhouse report, reference is made to the variation in cost of collection in raising from something over £400 million down to £379 million. Even in the case of the most efficient local authorities, the report says that the cost is likely to be £379 million by 1990. I accept the point made by the noble Lord, Lord Boyd-Carpenter, that it is only right that local authorities should meet part of the amount. If some of it is not included in their responsibility, there is a risk that the money will not be collected in the most efficient way possible.

I am not going to argue that we should not be introducing a poll tax. I think that it is mad and that the Government are daft; but they are going ahead with it. We are trying to find a fair deal for local government by means of the amendment. If the Government themselves have so wrongly estimated, it is only right that we should be pressing amendments in the House to make sure the Government recognise that the cost to be borne by the local authorities will be enormous and that therefore it is up to the Government to make some greater contribution, at least while the new tax is being introduced.

This will probably be the most expensive tax ever introduced in the country. It is certainly far more expensive to collect than VAT and income tax—although one part of income tax may be slightly more expensive to collect. Nevertheless, this tax is heading towards being the most expensive tax ever introduced. It is only right therefore that we in this country who support local government. who believe that it has a role to play and who wish to see it given back its strength and not utterly annihilated, should ensure that it has a fair deal if it is obliged to introduce a tax that I imagine most local authorities also think is daft.

We do not need to guess what the poll tax will cost in England and Wales because we know what is happening in Scotland. The administrative burden for the authorities of compiling poll tax registers is proving enormous. Tracking down 3.9 million Scottish adults liable for the poll tax has been every bit as difficult as was feared and predicted in the other place and here. We know that Strathclyde is trying to track down 2.3 million adults. We know that the council reckons on spending at least £5 million on capital costs to get the system running, and £8.6 million a year thereafter. It needs 370 extra full-time staff and at present is employing 100 canvassers to help with the register. Lothian needs an extra 150 staff, with costs in the region of £2.8 million for computers and £4.25 million for computer staff.

Once it is off the ground—if it is to remain, heaven help us—these costs naturally will not automatically recur. But it is surely beholden on the Government to make a real gesture when the new tax is being introduced. If, in the reply, we are to be told about efficiency, perhaps I can throw back this question to the Department of the Environment: is it not time that the Government looked at the activities of the PSA, which is about the most inefficient state agency business in the country?

Lord Stoddart of Swindon

My Lords, the noble Lord, Lord Boyd-Carpenter, criticised my noble friend Lord McIntosh of Haringey for coming back to the principle of the poll tax or community charge. The noble Lord ought to realise that it is virtually impossible on any amendment not to come back to the principle of whether we should have a poll tax because the tax, as has been shown throughout the debates in the House and indeed in another place, is unpopular on all sides. With the best will in the world, most people believe that it will be much more difficult to collect the tax than it is to collect rates. The local authorities will be under an additional burden of costs in regard to staff.

It is clear, having read my local evening newspaper, the Reading Evening Post, of last Monday, that Reading Borough Council and its treasurer, Mr. Innes, are already considerably worried about the cost of collecting the poll tax and of the new machinery, equipment and staff that will be needed. Mr. Innes—he is not leader of the council, Labour or Tory, but borough treasurer of Reading, which traditionally has had good treasurers who know what they are talking about—has told his local authority that the poll tax will cost an extra £2.6 million in collection charges. Indeed, the rate having been made for 1988–89, he now asks the council to provide him with an extra £87,000 this year for preparatory work in advance of the poll tax coming into operation. Mr. Innes has already informed the council, which will undoubtedly be criticised by the Tory opposition on the council for the increase, that he needs an extra 43 staff to put the poll tax into operation.

Reading, I am glad to say, has practically no unemployment. Firms are finding it difficult, indeed well-nigh impossible, to recruit qualified staff. So where on earth Mr. Innes will get the extra 43 staff from, I do not know. Nevertheless, he needs them and will have to have them if the borough is to collect the rates for itself and for the county council. Mr. Innes will also need a new computer, which will cost an extra £1 million. As to Reading Borough Council having to meet and overcome these difficulties, it is not a large city but, I suppose, a town of about 140,000 souls. In places such as Birmingham or Manchester we can imagine the additional costs that will be involved. It is quite clear that my noble friend's amendment is very timely and necessary, unless the poll tax charge is to be far higher than the Government estimate.

I promise that this is the last time that I shall quote Mr. Innes, the borough treasurer of Reading. He estimates that instead of the £246 per person which the Government believe that people in Reading will have to pay, on his calculations they will have to pay £280 per head, an increase of £34 over and above the government estimate. My noble friend knows about these things and is concerned about local authorities and ratepayers. They will no longer be called ratepayers; we shall have to call them charge payers. That is an un-British expression, is it not?

My noble friend is absolutely right to try to assist the people who will have to pay this charge and the local authorities by bringing forward his amendment. Local authorities over the last eight or nine years have been clobbered to the extent of about £13,000 million and it is about time they had some consideration. I hope that the noble Earl will be helpful in his reply.

5.30 p.m.

Lord Underhill

My Lords, I follow my noble friend because local facts are very useful to underline information such as that my noble friend gave. To reply to the noble Lord, Lord Boyd-Carpenter, I thought that my noble friend was very impressive in the information and facts he gave concerning the costs of setting up and operating the machinery.

This morning I read my local newspaper, the West Essex Gazette. I live not in a Labour-controlled authority area, not in one of the extravagant areas, but in the area of the Epping Forest District Council. For some years there has been a controversial scheme for the centralisation of the offices of the Epping Forest local authority. The scheme, which has been approved, is quite costly and development is now being carried out in the commuter country town of Epping. What do I find in the local newspaper? Already there is consternation. The question of accommodation in the centralised offices has been thrown into turmoil because it has been reported to the council that an additional 40 staff members will be required. If one multiplies 40 by the number of district councils in England/Wales it seems to come to about 16,000, which is well in line with the Price Waterhouse figure that the extra staff required will be between 14,000 and 18,000.

The local facts provided by my noble friend Lord Stoddart of Swindon together with those I have given surely bear out what my noble friend said about the costs of administration and staffing.

The Earl of Caithness

My Lords, I should like first to take this opportunity to speak generally on the subject of costs before dealing with the specific issues raised by these amendments. During the Committee stage I undertook to make available the results of the Price Waterhouse study when we received the final report. Price Waterhouse has now completed its report and copies were placed in the Library last week.

So far as the findings of the report are concerned, they generally confirm the Government's assumptions on costs. Your Lordships will be interested to know that in particular the consultants confirm what the Government have always maintained—that the cost of collecting the community charge will be similar to the present average cost of collecting rates from each ratepayer. The consultants estimate that these costs, including NNDR, will be between £379 million and £435 million in 1990, compared to the £200 million it now costs to collect rates each year. These costs will be taken account of in revenue support grant settlements from 1990–91 onwards. This surely refutes the allegations of the noble lords, Lord McIntosh of Haringey and Lord Ross of Newport, who have claimed that we have our figures grossly wrong.

The report also confirms that most of the expenditure on preparation will fall in 1989–90 and that the resources that the Government have provided for 1988–89, including the £25 million capital allocation, should be sufficient for any limited expenditure required this year. We shall, of course, be taking account of the Price Waterhouse findings that current expenditure in 1989–90 on preparation costs could be between £99 million and £122 million in our proposals for the RSG settlement. Additional capital allocations will be made when we have further considered the figures contained in the report.

Final announcements on the resources we shall be making available will be made following the usual consultation with local authority associations on RSG and in the specification of capital allocations which will follow the Chancellor's Autumn Statement.

The noble Lord, Lord McIntosh of Haringey, omitted to mention what I consider to be an important fact in the report—that there is scope for economies of up to 15 per cent. if all authorities were to perform as well as the most efficient in their category. I am sure that the noble Lord, like us, hopes that local authorities will take that on board. We shall also be disseminating to all charging authorities Volume II of the report covering best practice which, if followed, should help authorities to implement the new arrangements in an efficient and cost-effective manner.

I turn to the amendments. We discussed an amendment very similar to Amendment No. 215, which is being taken with this amendment, in Committee. I explained then that the attempt to have a particular amount of grant somehow set aside specifically to support administration, collection and enforcement costs was quite contrary to the unhypothecated, block grant nature of revenue support grant. Grant will be paid in relation to the totality of an authority's needs as measured by its needs assessment, but it will not be allocated to particular services. The nature of an unhypothecated block grant of this kind is that, having fixed the distribution of it between authorities, we let them decide what they are going to spend in total, how they are going to divide that total between the services they provide and how much they need to raise from local people. The idea that some part of the grant should be set aside does not fit into this framework and cannot easily be made part of this regime.

The noble Lord, Lord McIntosh of Haringey, explained on that earlier occasion that he was not seeking to influence the total of grant available but rather to make clear to chargepayers what money is going to services and what money is going to administration. But that cannot be done by specifying an amount of grant nominally going to support those costs if the authority can in fact spend as much or as little as it likes on administration. The level of grant would not necessarily indicate the level of spending.

The version of this amendment before us today introduces another principle which is equally unacceptable to us. It seeks to ensure that the amount of grant paid towards these costs shall be 80 per cent. of the actual costs incurred. Those are important words, for I remind your Lordships that we shall not know at the time we make the revenue support grant report what the actual costs incurred in the forthcoming year will be. Even if we had such clairvoyant powers, we have made it one of the main principles of the grant system that grant will depend only on need and not on actual expenditure. This ensures that grant entitlement does not vary. It means that we assess how much each authority needs to spend; we distribute grant accordingly; and we do not alter grant in relation to their spending decisions. This amendment would require us to pay grant in relation to actual costs. So a less efficient authority would get more grant than an efficient one and, because the total of revenue support grant would be fixed, it would take more grant out of the amount available for distribution generally. As my noble friend Lord Boyd-Carpenter said, this is exactly the kind of situation that we want to avoid. I cannot believe that any of your Lordships would want to reward efficiency and penalise efficiency in this way.

I shall answer the specific point of the noble Lord, Lord Ross of Newport, when he claimed that registrations in Scotland were proving extremely difficult. I understand that good progress is being made in all registration areas north of the Border. In many areas more than 90 per cent. of canvass forms have already been returned. Your Lordships will know that the register does not go live in Scotland until 1st October this year so we appear to be well on target for extremely high levels of registration. I also confirm that there is no evidence that the costs are running above the levels invisaged by the Government in their most recent estimates.

Finally, I should like to underline the fact that it has always been the Government's intention to ensure that authorities receive the resources that they need to implement the new arrangements. I hope that that will calm the fears of the noble Lords, Lord Underhill and Lord Stoddart of Swindon. The Price Waterhouse report will help us in our considerations of the level at which those resources should be made available.

Lord McIntosh of Haringey

My Lords, I make no apology to the House, and specifically to the noble Lord, Lord Boyd-Carpenter, for having drawn attention to the financial effects of the policy to which the Government wish the House to agree. Having decided at the beginning of your Lordships' Committee stage that it wished to see a flat-rate community charge, I believe that it is the proper responsibility of this House to look at the proposition carefully and critically; to consider the costs and possible drawbacks of the system and to seek to improve them so far as possible. That is what our amendment does. It is not a wrecking amendment. It cannot be claimed in any way that it criticises the principle of the community charge. It draws the attention of the House and the public to the enormously greater costs which will be involved in the administration of our local government finance system. It suggests that it should be the Government's responsibility to pay a larger proportion than is now proposed.

I should like to remind the House that the legislation has been introduced in a most unusual way. The Government have looked at local authority expenditure and have concluded that it is too high and ought to be diminished. They have also concluded that local authority expenditure is too high because not enough people pay the costs of that expenditure. Their solution is to increase accountability by having more people pay the costs of expenditure and by knowing that they are paying it.

That is a political judgment which we have already debated and I do not intend to debate it again now. However, I must point out that when that judgment is put into effect we shall have a taxation system called the "community charge" which will break every single rule of taxation. That is because it is the intention of the system that it should be conspicuous and that everyone should know that they are paying; whereas all the principles of taxation state that, so far as possible, one should try to have one's taxes levied without people noticing them. That is the effective way both to reduce the resistance to taxation and to obtain the highest possible return. The principle which the Government wish to impose on us states that the tax shall be collected in advance. That may have cash-flow advantages; but it breaks many of the rules of taxation which state that one collects the money only when one needs it.

The community charge has as a principle that it is collected from more people. Taxation priciples state that it is most efficient to collect a tax from as few people as possible in as large amounts as possible because by doing so the administration costs are lower and fewer people are antagonised by the tax. Above all, it is clear from the Price Waterhouse Report—and it was even clear from the Government's original misleading estimates—that per £100 gathered this tax will be much more expensive to collect. That is the true measure of the efficiency of a tax. It is not the unit cost, the cost per item on the register, or whatever; it is per £100 collected. This tax will rank with the worst taxes ever to be imposed on the British people. It is far more expensive to administer than income tax; far more expensive than the rates; far more expensive than value added tax: and far more expensive than inheritance tax or corporation tax, per £100 collected.

That is the judgment which we must make on the system. It must be a cool and collected judgment on the system because, for political reasons, it is being deliberately imposed by the Government. On every judgment that one makes on taxation this tax fails. It calls into question the good judgment of the Government in imposing it in the first place. It sounded very simple—did it not?—when we first heard about it. We were told that it will be a single amount collected from everyone on an equal basis. There will be no difficulty in calculating it and no difficulty in understanding it. That will be the great virtue of the community charge, as put forward by the Government last year. Any noble Lords who have sat through the Committee stage or the Report stage so far, or who have paid any attention to the debates in another place, will realise that we have moved a long way from the simple proposition originally put forward. We have a complicated tax, an unjust tax and an expensive tax. In the amendment we modestly suggest that slightly more—not all—should come from the central government exchequer and not from the community charge payers.

I entirely reject the argument used by the Minister which was that it is breaking the principles of the allocation of the resource grant. The need to spend money on administration is as much a need of a local authority as the need to spend money on education, housing or social services. It is a tragedy that the Government are imposing a need which merely increases administrative costs and brings no benefit. I believe that this is a reasonable compromise approach to a problem which must be recognised and which will become clearly recognised if and when the tax comes into force. I do not believe that it would be right for me to withdraw the amendment, and I shall seek the opinion of the House.

5.47 p.m.

On Question, Whether the said amendment (No. 49) shall be agreed to?

Their Lordships divided: Contents, 75; Not-Contents, 113.

DIVISION NO. 2
CONTENTS
Addington, L.	Longford, E.
Airedale, L.	McIntosh of Haringey, L.
Amherst, E.	McNair, L.
Ardwick, L.	Molloy, L.
Aylestone, L.	Monson, L.
Bonham-Carter, L.	Morton of Shuna, L.
Bottomley, L.	Nicol, B.
Bruce of Donington, L.	Northfield, L.
Buckmaster, V.	Oram, L.
Carmichael of Kelvingrove, L.	Pitt of Hampstead, L.
Carter, L.	Ponsonby of Shulbrede, L. [Teller.]
Cledwyn of Penrhos, L.
Cocks of Hartcliffe, L.	Prys-Davies, L.
David, B.	Ritchie of Dundee, L.
Dean of Beswick, L.	Robson of Kiddington, B.
Dormand of Easington, L.	Rochester, L.
Elwyn-Jones, L.	Ross of Newport, L.
Ennals, L.	Seear, B.
Ewart-Biggs, B.	Sefton of Garston, L.
Falkland, V.	Serota, B.
Foot, L.	Shepherd, L.
Gallacher, L.	Stallard, L.
Graham of Edmonton, L.	Stedman, B.
Grey, E.	Stewart of Fulham, L.
Grimond, L.	Stoddart of Swindon, L.
Hampton, L.	Strabolgi, L.
Harris of Greenwich, L.	Tordoff, L. [Teller.]
Hatch of Lusby, L.	Turner of Camden, B.
Hayter, L.	Underhill, L.
Henderson of Brompton, L.	Vernon, L.
Houghton of Sowerby, L.	Wallace of Coslany, L.
Hughes, L.	Wells-Pestell, L.
Irving of Dartford, L.	White, B.
Jacques, L.	Williams of Elvel, L.
Jay, L.	Willis, L.
Jeger, B.	Winchilsea and Nottingham, L.
Kilbracken, L.
Listowel, E.	Winterbottom, L.
Llewelyn-Davies of Hastoe, B.

NOT-CONTENTS
Alexander of Tunis, E.	Brabazon of Tara, L.
Ampthill, L.	Brookes, L.
Arran, E.	Brougham and Vaux, L.
Bauer, L.	Broxbourne, L.
Beaverbrook, L.	Bruce-Gardyne, L.
Belhaven and Stenton, L.	Butterworth, L.
Beloff, L.	Caithness, E.
Belstead, L.	Cameron of Lochbroom, L.
Bessborough, E.	Campbell of Alloway, L.
Blatch, B.	Campbell of Croy, L.
Blyth, L.	Coleraine, L.
Boyd-Carpenter, L.	Colnbrook, L.

Colwyn, L.	Mersey, V.
Constantine of Stanmore, L.	Mottistone, L.
Cork and Orrery, E.	Mountgarret, V.
Cowley, E.	Mowbray and Stourton, L.
Cox, B.	Munster, E.
Craigavon, V.	Murton of Lindisfarne, L.
Craigmyle, L.	Nelson, E.
Davidson, V. [Teller.]	Norfolk, D.
Denham, L. [Teller.]	Nugent of Guildford, L.
Dilhorne, V.	Onslow, E.
Dundee, E.	Orkney, E.
Elton, L.	Orr-Ewing, L.
Faithfull, B.	Oxfuird, V.
Ferrers, E.	Pender, L.
Ferrier, L.	Penrhyn, L.
Foley, L.	Peyton of Yeovil, L.
Fortescue, E.	Porritt, L.
Fraser of Kilmorack, L.	Portland, D.
Gainford, L.	Pym, L.
Gardner of Parkes, B.	Renton, L.
Geddes, L.	Renwick, L.
Halsbury, E.	Rochdale, V.
Hanson, L.	Russell of Liverpool, L.
Havers, L.	Selkirk, E.
Hesketh, L.	Skelmersdale, L.
Hives, L.	Somers, L.
Home of the Hirsel, L.	Strathclyde, L.
Hooper, B.	Strathspey, L.
Hylton-Foster, B.	Terrington, L.
Jenkin of Roding, L.	Teviot, L.
Kenilworth, L.	Teynham, L.
Killearn, L.	Thomas of Gwydir, L.
Kitchener, E.	Trafford, L.
Lawrence, L.	Trefgarne, L.
Long, V.	Trumpington, B.
Lucas of Chilworth, L.	Ullswater, V.
Lytton, E.	Vaux of Harrowden, L.
McAlpine of West Green, L.	Westbury, L.
Mackay of Clashfern, L.	Whitelaw, V.
Macleod of Borve, B.	Windlesham, L.
Mancroft, L.	Wise, L.
Marley, L.	Wolfson, L.
Marshall of Leeds, L.	Wyatt of Weeford, L.
Massereene and Ferrard, V.	Young of Graftham, L.
Merrivale, L

Resolved in the negative, and amendment disagreed to accordingly.

5.55 p.m.

Lord McIntosh of Haringey moved Amendment No. 50: After Clause 12, insert the following new clause:

("Transitional protection.

.—(1) A person falling within such category of income as may be prescribed by the Secretary of State and comprising those persons called upon for the first time to meet a financial liability for local taxation for whom the liability will cause hardship shall be subject to a charging authority's personal community charge on a tapering basis of 25 per cent. of the charge in the first year increasing annually by equal proportions to 100 per cent. of the charge in the fourth year from the date of introduction of the charge.

(2) Any income forgone by the charging authority as a result of the operation of subsection (1) above shall be reimbursed by way of revenue support grant payable to the charging authority.").

The noble Lord said: My Lords, I suggest that Amendment No. 50 is not in any way a destructive or wrecking amendment but is one which looks at the facts; namely, that the community charge, as the Government claim, will affect many people who have never been directly affected by local authority financing and taxation.

We have argued that many more people than pay the rates bill know that they are contributing to local authority taxation; but it is true, as the Government have always claimed, that they have not paid it directly. They may have had it paid via another member of the household or as part of the council rent. Therefore, in the light of the fact that there will be a new financial responsibility for a very significant number of people, we suggest that there should be a transitional period of four years. Where the new tax will cause hardship, it should be introduced gently for those individuals.

This is rather different from the transitional proposals in Part IV of the Bill which we may have an opportunity to discuss this afternoon without waiting until Monday. Our amendment is confined to those individuals who will suffer hardship due to being exposed to the community charge for the first time. We believe that this may decrease the unpopularity of the community charge and might be to the electoral benefit of the Government if this amendment were introduced. That is not our main reason for bringing the amendment forward, but we sense that there could be not only a feeling of injustice but actual hardship for perhaps a limited number of people—and I do not know how many. We should like the Government sympathetically to consider whether some way could be found—and perhaps this is not exactly the right way—to meet that very justifiable need. I beg to move.

The Earl of Caithness

My Lords, I give full credit to the noble Lord, because this amendment is deceptively simple. However, if implemented I suspect that it would cause many more problems than it would solve. Perhaps I may give your Lordships an example. It refers to individuals who are caused hardship but does not indicate how the proposal for a 25 per cent. payment in 1990 would relate to the rebate system under which 4 million individuals will be paying only 20 per cent. of the charge in 1990. How would they be dealt with? Nor do we accept that hardship will be caused. Even those on maximum rebates will have the 20 per cent. payment reflected in their income support.

Moreover, the amendment seems to envisage a static society. An individual on a low income who is not a ratepayer in 1989 will receive special transitional protection for four years. However, that individual may well obtain a well paid job shortly after the community charge comes in or he may stop living with his parents and buy a home of his own on 1st April 1990. Is he then to be more favourably treated for several years simply because of his personal circumstances on 31st March 1990?

The Government are committed to provide transitional protection for people in areas where the community charge would be higher than contributions from domestic rates. That safety net power is Clause 102. We believe that that is the right way to cushion the impact of the new system. As regards people on low incomes, we shall be providing rebates. These will apply to all those people who are on low incomes—young and old, householder and non-householder—and they will be a permanent feature of the new system, not just for the first few years.

I accept that there will be people who were not previously ratepayers but who will be asked to pay the community charge in 1990. I do not apologise for that. Indeed, it is central to the Government's proposal for increasing accountability that those 17 million non-ratepayers should make a direct contribution. Many of those people are in employment. The payments they make will help to reduce the bills faced by millions of single pensioner households.

The noble Lord's amendment contains a number of serious flaws. The Government believe that their proposals, temporarily through the safety net and permanently through the rebate system, provide the protection which I am sure he seeks and which we are providing in the Bill.

6 p.m.

Lord McIntosh of Haringey

My Lords, I confess I am surprised that the Minister should call in aid Clause 102. Indeed, it is true that Clause 102 provides that the Secretary of State has the power, which is called a safety net, to introduce grants for a transitional period to cushion the blow to local authorities of the change in the financing system. However, the grants are made to the local authorities and, therefore, in so far as they affect the community charge, they affect the community charge for all, rich and poor, whereas we are proposing a direct recognition of the problems of individuals who are in hardship. That is a very different proposition.

I suggest that our amendment is much more in accord with Conservative philosophy than is Clause 102, which is broadly based and covers both rich and poor within a given local authority area. On those grounds alone I am tempted to pursue the amendment to expose the difference between us on this matter. However, I accept that there are drafting difficulties in my amendment and that it is right I should take it away to see whether we can find a better way of giving expression to our objectives. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 13 [Relief for Students]:

[Amendment No. 51 not moved.]

Baroness Robson of Kiddington moved Amendment No. 52:

Page 9, line 46, at end insert— ("( ) If a person is undertaking a course of nursing education on each day of that period, the amount he is liable to pay under this section shall be determined by order, no such amount being less than one-fifth of the amount it would be apart from this section.").

The noble Baroness said: My Lords, in moving this amendment I speak also to Amendments Nos. 125 and 126. Your Lordships will remember that in Committee I moved an amendment to include nursing students in the provisions which entitle students to an 80 per cent. discount on the community charge. At that time I said I was confident that the Government would agree. It is obvious from the very short speech I made in introducing that amendment that I was convinced no government could refuse to accept it. However, it did not turn out to be so and the amendment was defeated. Therefore, I now introduce an amendment which gives the Secretary of State discretion to determine by order the amount of discount to which student nurses will be entitled.

In the debate in Committee the problems of the overlap of six months in England and 18 months in Scotland between the introduction of the community charge and Project 2000 were highlighted. We know that the community charge will be introduced in 1990 in England and Wales, but we are not as yet at all sure whether Project 2000 will be ready to be introduced in 1990. There are certain aspects of this overlap, this difference in timing, which were not brought out in Committee.

All of us realise that to introduce Project 2000, which is a major change in the student nurse education, will take some time. One cannot envisage that in the build-up to the introduction of Project 2000 for some time we will stop the training of student nurses. Therefore, inevitably there will be student nurses who start their training in the autumn of 1989 or the spring of 1990. It is unlikely that, having started that training, they will be able to switch to the new type of training under Project 2000. Therefore, there will be many student nurses in England, for example, who start a course of training in the autumn of 1989 and will be staying on the old system of nurse training and presumably will not be entitled to the 80 per cent. rebate on the community charge. This also means that if nurses start in 1989 they will be paying the full charge for 27 months until their course finishes after the introduction of the community charge in 1990.

The position is even worse in Scotland. A student nurse starting in the autumn of 1989 will be liable to pay the community charge in full and will have to do that for the full three years of training. That will mean that there could be the anomaly that nurses who start their training in 1989 under the old system of training will be paying 100 per cent. of the community charge up to 1992. If Project 2000 is introduced in the autumn of 1990, those students who start under the new system will be paying only 20 per cent. of the community charge. That is an anomaly which the Government must seriously consider.

There is another aspect that worries me. Under Project 2000 nurse education will be linked more closely to higher education and the contribution by nurses to hospital manpower will be cut from 80 per cent. to 20 per cent. They will be paid by a non-means-tested bursary. However, I cannot envisage that this reduction from 80 per cent. to 20 per cent. will take place just like that. It is very likely, with the present shortage of staff in the hospital service, that health authorities will insist that this contribution by student nurses to hospital manpower will be reduced gradually over a period of years. I do not know, and I have heard nothing to tell me, how and at what point, even after Project 2000 is introduced, the nurses become entitled to an 80 per cent. reduction in their community charge.

I know that many of these problems are speculative. All that we know for certain is that the Government have committed themselves to the Project 200 reforms, but we do not know exactly when they will be introduced and we do not know exactly at what point the nurse will be entitled to an 80 per cent. rebate.

Clearly this amendment is less desirable than the amendment I moved in Committee, but it gives the Secretary of State discretion to act to alleviate the position for nursing students. He will be able to judge the problems as they come forward in the development of Project 2000 after the introduction of the poll tax. If this amendment finds favour with the Government and with this House, the Secretary of State will hopefully use it to minimise the differential between students and student nurses. I beg to move.

Baroness Cox

My Lords, in speaking in support of these amendments it seems to me that there are three kinds of arguments that can be briefly put forward. The arguments are the principles in the amendments, professional considerations and political considerations. The principles in the amendments have been very fully and lucidly explained by the noble Baroness. Therefore perhaps I may briefly highlight the professional and political considerations.

It is absolutely essential not to underestimate the seriousness of nursing recruitment. Traditionally, nursing has been taking a quarter of the girls leaving school with the appropriate qualifications. With the falling numbers of pupils leaving schools, in theory the profession would need to take half the number of school-leavers with the appropriate qualifications if it is to maintain the current levels of recruitment, training and staffing in the National Health Service. Clearly it is not possible to do that, especially as there are so many good career opportunities available for school-leavers. Therefore there is great competition for well-qualified recruits to a wide range of professions and occupations. Nursing must be able to compete not only in attracting school-leavers but also in attracting other categories of recruits including more men and mature students.

Unless nursing can do this the current crisis in the National Health Service caused by shortages of staff will become exacerbated to perhaps the point of a possible breakdown in the provision of certain services. It was said by my noble friend the Minister at the Committee stage that student nurses were well-off compared with other students who are on grants. Once the deductions are made, student nurses are not so very much better off. It is important to remember that they work extremely hard and carry very heavy responsibilities. Therefore, the life of a student nurse is not like that of other students. It is not comparable.

There is another point which was not made before or recognised; namely, that many student nurses do not receive entitlement to advantages which are enjoyed by other students such as free banking services. They have quite a few disadvantages which were not previously recognised. It is a general perception that nurses have received significant pay awards. That is both true and highly welcome for qualified nurses and is much appreciated. However, student nurses received only 6 per cent. of what was already a low salary. It is important not to see them as part of the overall and very generous pay award.

Perhaps I may raise a brief point of political consideration which it is not inappropriate for me to make from this side of your Lordships' House. The Government received and deserved great popularity with the profession and the public for the measures that they have recently taken as regards nursing. They were principled and much-needed professionally.

I hope that my noble friend understands that it will be an enormous pity to lose good will and this well-deserved popularity by pursuing a cheeseparing policy as regards student nurses, especially without good arguments. I did not find his arguments convincing at Committee stage. It is one thing to be unpopular for good reasons and because one is adhering to certain principles, but I suggest to him that it is politically inept and inexcusable to become unpopular without good reason. I hope that my noble friend will respond sympathetically to these amendments.

6.15 p.m.

Lord Morton of Shuna

My Lords, my name is on these amendments and I shall not take up your Lordships' time for very long. We have had two very able speeches so there is very little for me to add. It seems indicative of what happened that perhaps there was no consultation between the Department of Health and Social Security, which took a quite proper attitude to nurses by changing them to students, and the Department of Education and Science. No thought was given to how this was to be done. Surely the only fair way is to call student nurses "students" from now on. With a predicted shortfall of at least 3,000 recruits for nursing in England and Wales—I am very carefully not mentioning Scotland—by the year 1990, it is daft for the Government not to give effect for this amendment.

Lord Trafford

My Lords, I support this amendment because it seems that it has two points very much more in its favour than the amendment discussed at Committee stage. First, it is not asking the Government to do anything specific at this time and neither is it asking them to grant to student nurses (on the basis of being student nurses) any particular relief. At the Committee stage the point was made that student nurses earn a certain salary and that many other people do not earn greater salaries yet they have to pay the community charge.

In this amendment that situation does not arise. Therefore I believe that one can support it even more strongly because it seems to be what one might call a more reasonable amendment. It is one that says in effect "We are heading for trouble; we can see trouble at least 18 months ahead"—there is some trouble now—"We know that there is confusion between Scotland, in which this measure will be implemented earlier, and in England". I remember that I made a slight joke about that last time when I suggested that the fact that it was implemented in Scotland a year early would definitely help the nursing problems of England for a short time. However, it does not alter the more serious point; namely, that there will be a distinct difference in the charges made to nurses north of the Border as opposed to those south of the Border for a considerable period of time.

In addition, the confusion was ably described by the noble Baroness, Lady Robson, and by my noble friend. There will be confusions of transition from the present method of student nurse training (which is an apprenticeship system where they are employees and mostly in service) to the time when they become students of higher education when they are treated, certainly initially, as ordinary undergraduates. Though we have received a concession from the Government that when nursing students are fully accepted into this scheme they will become liable for the rebate, they will not be liable in the intermediate period. However, it has been said on more than one occasion in this House that it takes time to introduce this new kind of education system and it creates confusion.

That is one good reason for suggesting that we give the Secretary of State powers to deal with the situation that can be seen coming by anyone who is not blind. There is another compelling reason that I would urge upon my noble friend the Minister. One should not create an organisation to which one wishes to recruit staff and then ruin all the recruiting posters by saying "If you come I cannot actually tell you what you will be paid, what taxes you will be liable to and what advantages and disadvantages you will have, but I can tell you not to train in Edinburgh between 1989 and 1991 for certain, and maybe not in Birmingham, London, Brighton or wherever it may he after 1991 and until 1994". As we have heard from my noble friend Lady Cox, we are already somewhat short of young nurses. Owing to demographic change, of which everyone is aware and which has been discussed in other connections, we need to recruit 50 per cent. of that age group of young women during the period up to 1995 if we are to recruit at the same rate.

We have a recruiting problem already. Are we to complicate it further? I do not see any reason why we should do that. If I see a runaway car hurtling towards me down the road, with disaster staring me in the face, I should be a fool if I did not take evasive action, especially if I was given plenty of warning. I urge my noble friend to take note that the Government have been given adequate warning both at Committee stage and now with a more reasoned amendment at this stage. For both those reasons, as well as for the reason of natural justice which was also raised, I sincerely hope that my noble friend will at the very least agree to look at this matter again in view of the complications, but preferably to agree to the amendment.

The Earl of Halsbury

My Lords, in rising to support the amendment of the noble Baroness, Lady Robson of Kiddington, and the extremely useful contributions of other noble Lords, I have an interest to declare. My granddaughter is a student nurse at the Westminster Hospital. In so far as we have a special arrangement with the Westminster Hospital, I must warn noble Lords that if in the heat of debate they become over-excited and have an epileptic fit, a coronary thrombosis or a stroke, they are liable to suffer from her ministrations. Having declared that interest I must to some extent withdraw it because she is in her third year and will not be affected by the provisions after 1989.

I have a cautionary word to say to the noble Earl who is to reply for the Government. Every time the Government have gone down on the two major Bills that we have been considering for so many weeks, it is because they have been obdurate and defiant in the face of the growing opinion of this House which, sitting on the Cross-Benches, I can feel piling up. I beseech the noble Earl to respond to what his noble friend Lord Trafford has just said and be accommodating on this point. The nursing profession is a popular one. At some time or other we have all been dependent on them. We do not want to see nurses or student nurses underpaid or hardly treated. We do not want to see anomalies between student nurses in Scotland and student nurses in England and Wales. I beseech the noble Earl to be a little pliable in a matter of this kind.

Lord Auckland

My Lords, throughout the country schools are being visited by nursing officers seeking to increase the ratio of student nurses. It is certainly true in my area of Surrey where I am president of the friends of my local Epsom District Hospital. Quite frequently students, and especially sixth-form students, visit the hospital or have lectures on the nursing profession. As has already been said by my noble friend Lady Cox, who is especially knowledgeable on these matters, there is a considerable shortage of student nurses.

We can all indulge in special pleading. My younger daughter is now a staff nurse and will not he directly affected by the amendment. However, we have to look to the future. Student nurses are not in the same category as ordinary students. They have to carry out responsibilities far beyond the requirements of students of, say, chemistry, architecture and so on. Many noble Lords will know that student nurses, especially those in long-stay hospitals, have to take complete control of a ward if only for a short time. That is an enormous responsibility for any young person. I join the pleas to my noble friend to look carefully at this all-party amendment. I have just been to a reception given by the Royal College of Nursing. It is one of the most responsible bodies in this country. Whenever it makes a plea, it is a responsible one. If only in deference to that fine body, the Government should give serious consideration to this amendment.

Baroness Faithfull

My Lords, I shall not repeat what has been so wonderfully said by other speakers. I rise to support the amendment.

The Earl of Perth

My Lords, a year ago—it seems like a long time—we were considering the community charge for Scotland. At that time I led a compaign to have overseas students released from 50 per cent. of the liability. A remarkable thing happened. Instead of that 50 per cent., the Government agreed to 20 per cent. for all students. The generous action of the Government at that time is one of the happiest things I can remember.

When I listened to the speeches today I was moved to say to the Government that they should consider acting similarly in this case. We all realise, first, that the name is "student nurses". Secondly, the student nurses earn money. Is that a reason why they, almost alone of all the students, should not get the relief which others are to get? Having heard all the health reasons, the need for hospitals to have recruits and so on, I beg the Government to consider accepting the amendment or something similar which gives the effect that we all want.

Lord Hesketh

My Lords, I confess that 1 am just a little surprised that the House is having a repeat of the debate it had on the same issues at Committee stage. On that occasion, the relevant amendment was pressed to a Division and defeated.

As I confirmed on that occasion, the Government have indicated that they intend to accept many of the recommendations of Project 2000, including the proposal that student nurses should receive nontaxable bursaries instead of salaries. Assuming that the qualifying conditions concerning supervised study and similar matters are met, student nurses will then automatically become students for the purpose of the personal community charge and eligible for the 80 per cent. relief under Clause 13. It may be of assistance if I say that Amendments Nos. 125 and 126 are not necessary to allow this to happen. The regulation-making powers in Clause 28 are already wide enough to ensure that student nurses will become students for these purposes when Project 2000 is implemented.

The detailed implementation of Project 2000 is a matter for my right honourable friend the Secretary of State for Social Services. I understand, however, that implementation may well begin within the next 18 months but is then likely to proceed in stages.

In Committee on 6th June I argued—and on a Division the Committee accepted—that we should not extend the student relief to student nurses until Project 2000 was implemented. Until that time, student nurses will remain salaried employees, paid on a scale rising to £6,783 this year in London. Part of their time will be spent training; but in that respect they will be in the same position as others undertaking on-the-job training for a trade or profession. The implementation of Project 2000 will be the watershed. Thereafter, as the Secretary of State for Social Services has made clear, the whole nature of student nurses' training will alter; and they will receive bursaries, not salaries. When that point is reached and student nurses become students, it will be appropriate to give them the 80 per cent. relief from the community charge. Indeed, as I have already said, that will happen automatically, assuming the qualifying conditions are met. What in the Government's view is not acceptable is to jump the gun and apply Clause 13 to student nurses in advance of Project 2000.

Part of the problem in today's debate is in a way caused by the arrival of Project 2000 at the same time as this Bill. I am sure that my noble friend Lady Cox will agree when I say that Project 2000 has nothing to do with the Bill as such. The difficulty, as I see it, is summed up by the new system and the old system. The real problem is that one group of people has not been mentioned at all. I refer to all the contemporaries of student nurses—many millions of them—who are earning around three times as much as ordinary students and will be expected to pay the community charge. They might feel that there was an anomaly that while they should be expected to pay the community charge, the student nurse earning £6,700 per annum, and before the introduction of bursaries and her acceptance as a full-time student, should not.

I am afraid that my remarks today have been similar in content to those contained in my speech on 6th June when we debated these matters in Committee. On that occasion at col. 1200 the noble Baroness, Lady Robson, said that she had, never been so disappointed by a reply". If she is equally disappointed today, I can only say that I have at least been consistent. I ask her to accept that what I am offering is in fact very good news for student nurses and that the implementation of Project 2000—which itself has been welcomed by the nursing profession—will in due course also lead to student nurses gaining an 80 per cent. reduction in their community charge.

Lord Trafford

My Lords, before my noble friend sits down, perhaps I may ask him a question on this point. I do not think that he addressed himself to the fact that this amendment is different to the one moved in Committee. This is an enabling amendment with discretionary powers to avert the possibility of a particular situation arising; it does not contain a request as did the amendment which was moved in Committee.

Lord Hesketh

My Lords, I fully appreciate what my noble friend said, but I feel that I have tried to answer him and I can say no more than I have already.

Baroness Cox

My Lords, before my noble friend sits down for the second time, would he agree that the figure he has just given us is by no means typical of student nurses' salaries and that it is in fact at the top end of the scale in London, taking into account the London allowance? It is certainly not what the average student nurse receives, which is very much less.

Lord Graham of Edmonton

And he knows it!

Lord Hesketh

My Lords, I gave the figure as a1n example against the higher figure for a student grant as a proportional equivalent. I believe that the noble Baroness will find it to be accurate.

Baroness Robson of Kiddington

My Lords, I was disappointed in Committee but I am open-mouthed at the reply which I have just received from the Minister. First, he referred to a repetition of the debate on the amendment in Committee taking place now on Report. There is no similarity between the amendment we have just discussed and the one moved in Committee. We have introduced it to try to get the Minister and the Government to agree to some kind of assistance for student nurses.

We would rather have had the amendment we introduced in Committee, but this, at least, will enable a compassionate Secretary of State to help look after nurses. Reference was made to the income of nurses, comparing it with that of students. Students do not work 52 weeks of the year and they have plenty of time to go out and earn money during the vacation period. They have all kinds of possibilities. Student nurses work so hard that they cannot do anything more to augment their income.

I am delighted to have the support of the noble Lord, Lord Trafford. I am also delighted that so many Members on the Government Benches can see the difference between this amendment and the one we moved in Committee. I am afraid that under the circumstances I must press the amendment to a Division, and I hope that the House will support me.

6.34 p.m.

On Question, Whether the said amendment (No. 52) shall be agreed to?

Their Lordships divided: Contents, 85; Not-Contents, 65.

DIVISION NO. 3
CONTENTS
Addington, L.	Lytton, E.
Airedale, L.	McIntosh of Haringey, L.
Ardwick, L.	Macleod of Borve, B.
Auckland, L.	McNair, L.
Avebury, L.	Massereene and Ferrard, V.
Aylestone, L.	Monson, L.
Beloff, L.	Morton of Shuna, L.
Bonham-Carter, L.	Moyne, L.
Broxbourne, L.	Nicol, B.
Bruce of Donington, L.	Oram, L.
Buckmaster, V.	Orkney, E.
Carmichael of Kelvingrove, L.	Penrhyn, L.
Carter, L.	Perth, E.
Cledwyn of Penrhos, L.	Pitt of Hampstead, L.
Cox, B. [Teller.]	Ponsonby of Shulbrede, L.
Craigavon, V.	Prys-Davies, L.
David, B.	Renton, L.
Dean of Beswick, L.	Ritchie of Dundee, L.
Donoughue, L.	Robson of Kiddington, B. [Teller.]
Dormand of Easington, L.
Ennuis, L.	Rochester, L.
Ewart-Biggs, B.	Ross of Newport, L.
Faithfull, B.	Russell of Liverpool, L.
Falkland, V.	Seear, B.
Foot, L.	Seebohm, L.
Gallacher, L.	Serota, B.
Graham of Edmonton, L.	Shepherd, L.
Grey, E.	Stedman, B.
Halsbury, E.	Stewart of Fulham, L.
Harris of Greenwich, L.	Stockton, E.
Hatch of Lusby, L.	Stoddart of Swindon, L.
Hayter, L.	Strabolgi, L.
Hylton-Foster, B.	Swinfen, L.
Irving of Dartford, L.	Tordoff, L.
Jay, L.	Trafford, L.
Jeger, B.	Turner of Camden, B.
Kilbracken, L.	Underhill, L.
Killearn, L.	Vaux of Harrowden, L.
Kinloss, Ly.	Wallace of Coslany, L.
Lawrence, L.	White, B.
Listowel, E.	Williams of Elvel, L.
Llewelyn-Davies of Hastoe, B.	Willis, L.
Longford, E.	Wise, L.

NOT-CONTENTS
Arran, E.	Home of the Hirsel, L.
Beaverbrook, L.	Hooper, B.
Belhaven and Stenton, L.	Jenkin of Roding, L.
Belstead, L.	Kitchener, E.
Bethell, L.	Lindsey and Abingdon, E.
Blatch, B.	Long, V.
Brabazon of Tara, L.	Lucas of Chilworth, L.
Brookes, L.	McAlpine of West Green, L.
Brougham and Vaux, L.	Mackay of Clashfern, L.
Bruce-Gardyne, L.	Mancroft, L.
Caithness, E.	Marshall of Leeds, L.
Cameron of Lochbroom, L.	Merrivale, L.
Campbell of Alloway, L.	Mottistone, L.
Campbell of Croy, L.	Mowbray and Stourton, L.
Coleraine, L.	Munster, E.
Colwyn, L.	Murton of Lindisfarne, L.
Constantine of Stanmore, L.	Nelson, E.
Cork and Orrery, E.	Onslow, E.
Cowley, E.	Pender, L.
Craigmyle, L.	Peyton of Yeovil, L.
Davidson, V. [Teller.]	Redesdale, L.
Denham, L. [Teller.]	Renwick, L.
Dilhorne, V.	Skelmersdale, L.
Dundee, E.	Stevens of Ludgate, L.
Ferrers, E.	Strathclyde, L.
Ferrier, L.	Teynham, L.
Foley, L.	Thomas of Gwydir, L.
Fortescue, E.	Trefgarne, L.
Fraser of Kilmorack, L.	Trumpington, B.
Hanson, L.	Ullswater, V.
Havers, L.	Windlesham, L.
Hesketh, L.	Young of Graffham, L.
Hives, L.

Resolved in the affirmative, and amendment agreed to accordingly.

6.41 p.m.

Clause 14 [Standard community charge]:

Lord Hesketh moved Amendment No. 53: Page 10, line 9, leave out ("sub-paragraph") and insert ("paragraph").

On Question, amendment agreed to.

Clause 16 [Joint and several liability: spouses]:

Lord Morton of Shuna moved Amendment No. 54: Page 1, line 15, after ("to") insert ("or lives with as if they were husband and wife").

The noble Lord said: My Lords, I am speaking also to a group of amendments that consists of Amendments Nos. 54 to 59 and 61. Amendment No. 54 is a purely drafting amendment. In six or seven lines the Scottish Act deals with the joint and several liability of people who are married or who are living together: Persons who

1. (a) are married to each other and live together; or
2. (b) being a man and a woman, live together as if they were husband and wife,

shall be jointly and severally liable for the personal community charge.". The Bill manages to take just about a whole page to deal with the same point. If and when the Minister moves Amendment No. 60, he will have got Clause 16 into at least a full page of print. I wonder why that is necessary.

The amendment is aimed at subsection (7) which was commented upon during the clause stand part debate in Committee. It reads, taking it shortly, that for the purposes of that clause people are married to each other if they are a man and woman who are married to each other or who are not married to each other. There was a certain difficulty in defining people who were married to each other as being people who were, on definition, not married to each other. It is to try to correct that apparent difficulty that the amendments are put forward.

Amendment No. 61 is the main amendment in which I suggest an alteration to subsection (7) to say, For the purposes of this section, people are jointly and severally liable where they are persons who are (a) married to each other and live together or (b) being a man and woman, live together as if they were husband and wife. That is a simpler and more easily understood way of putting the matter. To adopt the words of the noble Lord, Lord Boyd-Carpenter (who I am sorry to see not in his place) it is a more appropriate and more decent way of describing the situation.

To take the words in the Bill, to describe people who are living together as married people when they are not is absurd. To go through the whole clause providing a "person is married to a person ( the spouse)" and then to discover at the bottom of the clause that one does not need to be married, but if you are living together on a day you have joint and several liability, is absurd. Amendments Nos. 54 and 59 are an attempt to clear up that matter by making the provision more straightforward. If I had not been engaged on another Bill, which has taken up a great deal of your Lordships' time, I might have had a shot at trying to shorten Clause 16 more radically. The amendments make the sense rather more decent. I beg to move.

6.45 p.m.

The Earl of Caithness

My Lords, I should like to respond to the noble Lord, Lord Morton of Shuna, in two stages: first, on the policy intention underlying Clause 16, and the equivalent Scottish power; and, secondly, on the question of the words used in the clause.

So far as the policy is concerned, I can confirm that the position under the Bill will be the same as under the Scottish Act so far as the personal community charge is concerned. Married couples, and couples who are not married but are living together as husband and wife, will be jointly and severally liable for the charge during the period that they are living together.

Clause 16 takes more words to secure this outcome than does the equivalent provision—Section 8(7)—of the Scottish Act. That is partly a reflection of the fact that the personal community charge in England and Wales is specifically set up on the basis of daily liability, whereas the same is not true of the Scottish Act. That means, for example, that Clause 16 deals with part years' liability more explicitly. Your Lordships will recall that this is territory that we went over to some extent yesterday.

In addition, the Bills were drafted by different draftsmen. As many Members of your Lordships' House will be aware, Scottish legislation is produced by separate draftsmen within the Lord Advocate's Department. That in turn reflects the fact that Scottish law is different in many respects from that applying south of the Border.

Inevitably, different draftsmen will choose somewhat different ways of conveying the meaning that is required. That will be particularly so where, as here, we are dealing with Scottish and English law; and where there is a slightly different approach to the way liability for the charge is established in the two pieces of legislation.

As someone who is not a lawyer, I have always been extremely circumspect about implying that I might be able to draft legislation better than parliamentary counsel. The noble Lord, Lord Morton of Shuna, as a lawyer, obviously feels less constrained. However, the remarks he has made, it seems to me, are directed not towards the meaning of Clause 16, but purely to the way the result is achieved.

Much the same point was raised during consideration of the Bill in another place, and an amendment was put forward to alter the wording of the clause. My honourable friend the Minister for Local Government—whose views I commend as a fellow Queen's Counsel to the noble Lord—said in response: I agree that the formulation used … that 'married' for these purposes includes couples who are not married, but who are living together as husband and wife—is a little unusual. But the meaning is absolutely clear. The amendment would not change the sense in any way and I am not inclined to accept amendments to add unnecessary words to the Bill".—[Official Report, Commons Standing Committee E, 16/2/88; col. 743]. Finally, I venture to suggest that the noble Lord's amendments could make the clause less clear than it is now. The noble Lord made fun of the drafting of the Bill as it now is, but Clause 16(1)(b), for example, would, if the noble Lord's amendments were accepted, read: On any day in the chargeable period the chargeable person is married to or lives with as husband and wife a person (the spouse or other person) who is aged 18 or over on the day. The redrafting produces two linked pairs of criteria. Despite the skill that the noble Lord, Lord Morton of Shuna, undoubtedly has, I suggest that there seems to be some room for dispute as to which of those pairs are to be taken together, or how they relate to each other. The conclusion I draw is this: the existing drafting is clear, and secures the policy intention. We need to have a very good reason before we change the drafting simply for its own sake. I do not think that there is good reason, especially if, as I rather fear, the suggested revised wording might be capable of misinterpretation.

Lord Morton of Shuna

My Lords, I am much obliged for that very careful answer. What baffles me about this whole Bill relating to the community charge is that after both Houses of Parliament had in effect gone through a community charge Bill in 1987 drafted by the parliamentary draftsman and revised with all the skill of this House and the House of Commons and passed into force as an Act, the parliamentary draftsman drafting the Bill now before us did not start with the Scottish Bill as his framework and go along from there, changing it as necessary for English law. The noble Earl will be well aware that if two pieces of legislation covering the same subject are worded differently, the courts will assume that the meaning is different. So one can foresee a wonderful argument turning up in court in England—thank goodness!—where somebody will come along and say, "Ah, but look at the Scottish section which Parliament passed the previous year. It said this; it is different: therefore Parliament must have meant it to be different and therefore there is some difference."

I do not wish to press this. If the Government intend to proceed with something as chaotic as Clause 16, I can only say that I have made an attempt to try and clear it up. The Government have had the encouragement of the noble Lord, Lord Boyd-Carpenter, pointing out that some words I have suggested are more decent and appropriate. If the Government choose to ignore that, then there is the proverb which says something about those whom the gods wish to destroy. However, at this stage, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 55 to 59 not moved.]

The Earl of Caithness moved Amendment No. 60:

Page 11, line 37, at end insert— ("(6A) In a case where—

1. (a) the chargeable person and the spouse are jointly and severally liable to pay an amount by virtue of this section,
2. (b) the chargeable person fails to pay all or part of it because of wilful refusal or culpable neglect, and
3. (c) the spouse accordingly pays an amount to the authority, the spouse may recover from the chargeable person an amount equal to the amount paid by the spouse to the authority.

(6B) Subject to subsection (6A) above, the spouse may not recover from the chargeable person anything by way of contribution to any amount paid by the spouse to the authority by virtue of this section.").

The noble Earl said: My Lords, this is a clarifying provision which, I am sure, will be welcomed on all sides of the House and in particular by the noble Lord, Lord Morton of Shuna. Your Lordships will be aware that under Clause 17(8), where a managing agent has to pay a collective community charge on behalf of a landlord, by virtue of joint and several liability, the managing agent may recover the sum from the landlord. There is, however, no similar provision under Clause 16 for recovery as between husbands and wives or persons living together as husband and wife. The Government have taken the view that there should be such provision for the avoidance of doubt.

In deciding the form that this recovery provision should take, we have paid considerable attention to the views expressed in your Lordships' House at an earlier stage. Noble Lords will recall that joint and several liability was devised so that where one partner—perhaps a non-working wife—has no money of her own, the other partner should pay her charge. It is not the intention that the non-working wife should be pursued for the community charge of a working husband, nor do I believe that charging authorities will apply joint and several liability in that way.

At an earlier stage I assured your Lordships' House that in the Government's view charging authorities could be relied upon to act responsibly in applying joint and several liability. This amendment backs up our belief by giving a very clear signal both to charging authorities and to the partners of nonworking wives.

The amendment provides that where a person fails to pay the community charge because of wilful refusal and culpable neglect and the partner has to pay it on his or her behalf, then the partner who actually pays may recover the amount in question from the partner who failed to pay. It also provides, however, that where a person fails to pay the charge and there is no wilful refusal or culpable neglect, then the partner who actually pays cannot recover the amount in question.

It may make matters somewhat clearer if I remind your Lordships that in lay terms failing to pay because of wilful refusal or culpable neglect means that a person had the money, could have paid, but either chose not to do so or failed to do so deliberately. If a person fails to pay, but there is not wilful refusal or culpable neglect, then it is likely to be because the person simply did not have the money with which to pay.

In other words, if a working husband has to pay the charge on behalf of his wife and the wife has no money of her own, then the husband cannot recover the money from his wife. If on the other hand a non-working wife has to pay the charge on behalf of her working husband, then the wife may recover the money from her husband. I hasten to add that in practice we do not expect that a non-working wife will have to pay her husband's charge. But this provision is useful because it gives a clear signal, as I have said, that joint and several liability is to be invoked in favour of women who have no income of their own, not against them. I beg to move.

Lord Morton of Shuna

My Lords, this shows that the Government really have gone completely off their heads. Can I have an assurance that neither this amendment nor anything like it will be introduced into the Scottish Act and that there will not be the comparative amendment? This amendment appears to provide—it does not say anything about the recovery provisions so I suppose it is the same as we had before—that if somebody pays their partner's poll tax, they go to the magistrates' court and say, "Jeannie was wilfully refusing to pay. Please put her in prison." It does not seem to me that this does much for restoring the Victorian values of family life, if there were any.

I do not see what the Government are about in this case. Are they really setting out to increase the work of the divorce courts? Can one really imagine setting out in a case where people are married to each other and giving a right to recover from the other partner by establishing that the person was wilfully refusing to pay or did not pay by culpable neglect? There are occasional arguments in family life as to where the money is to go. But this does not seem to me something which will decrease those arguments.

I have seldom seen anything that I could regard as so plain silly as this amendment, quite apart from the fact that by the time this occurs one would imagine that the parties had ceased to live together and their joint and several liability had flown away long ago. It would never have happened. Can the Minister explain to me where this will happen with people still having a joint and several liability? It seems to me plain idiotic.

Lord Swinfen

My Lords, I wonder whether my noble friend could confirm that a husband is responsible for his wife's debts. Is this not a case of the law as it stands by common law in any case? I wonder why it is necessary to put it in the Bill.

The Earl of Caithness

My Lords, I am terribly disappointed that the noble Lord, Lord Morton of Shuna, could not give such a reasonable amendment a more glorious welcome.

On the first point that he raised—whether it would be translated into the Scottish Act—of course I shall discuss this matter with my right honourable friend the Secretary of State for Scotland. In due course he will decide whether it is necessary. But he will bear in mind very much the words of the noble Lord, Lord Morton of Shuna.

To reply to the other point, husbands and wives are not responsible for each other's debts unless the law so provides, as Clause 16 does. I think that covers the point of my noble friend Lord Swinfen. To recap, this amendment provides in certain circumstances an indemnity for a person who has to pay the community charge on behalf of his or her partner by virtue of joint and several liability. It is a clarificatory amendment which I commend to your Lordships.

6.59 p.m.

On Question, Whether the said amendment (No. 60) shall be agreed to?

Their Lordships divided: Contents, 72; Not-Contents, 37.

DIVISION NO. 4
CONTENTS
Alexander of Tunis, E.	Ferrier, L.
Arran, E.	Fortescue, E.
Auckland, L.	Hanson, L.
Beaverbrook, L.	Havers, L.
Belhaven and Stenton, L.	Henley, L.
Beloff, L.	Hesketh, L.
Belstead, L.	Hives, L.
Bethell, L.	Home of the Hirsel, L.
Blatch, B.	Hooper, B.
Brabazon of Tara, L.	Hylton-Foster, B.
Brougham and Vaux, L.	Jenkin of Roding, L.
Broxbourne, L.	Kitchener, E.
Bruce-Gardyne, L.	Lindsey and Abingdon, E.
Caithness, E.	Long, V. [Teller.]
Cameron of Lochbroom, L.	Lucas of Chilworth, L.
Campbell of Alloway, L.	McAlpine of West Green, L.
Campbell of Croy, L.	Macleod of Borve, B.
Coleraine, L.	Mancroft, L.
Colwyn, L.	Marshall of Leeds, L.
Constantine of Stanmore, L.	Merrivale, L.
Cork and Orrery, E.	Mersey, V.
Cox, B.	Mottistone, L.
Craigavon, V.	Munster, E.
Craigmyle, L.	Murton of Lindisfarne, L.
Davidson, V. [Teller.]	Nelson, E.
Denham, L.	Orkney, E.
Dilhorne, V.	Pender, L.
Dundee, E.	Penrhyn, L.
Faithfull, B.	Redesdale, L.

Renton, L.	Teynham, L.
Rochdale, V.	Thomas of Gwydir, L.
Skelmersdale, L.	Trafford, L.
Stevens of Ludgate, L.	Trefgarne, L.
Stockton, E.	Ullswater, V.
Strathclyde, L.	Vaux of Harrowden, L.
Teviot, L.	Wise, L.

NOT-CONTENTS
Addington, L.	McNair, L.
Airedale, L.	Morton of Shuna, L.
Bonham-Carter, L.	Nicol, B. [Teller.]
Carmichael of Kelvingrove, L.	Oram, L.
Cledwyn of Penrhos, L.	Pitt of Hampstead, L.
David, B.	Ponsonby of Shulbrede, L. [Teller.]
Dean of Beswick, L.
Donoughue, L.	Robson of Kiddington, B.
Dormand of Easington, L.	Ross of Newport, L.
Elwyn-Jones, L.	Seear, B.
Graham of Edmonton, L.	Stedman, B.
Grey, E.	Stewart of Fulham, L.
Harris of Greenwich, L.	Stoddart of Swindon, L.
Hatch of Lusby, L.	Strabolgi, L.
Irving of Dartford, L.	Tordoff, L.
Jay, L.	Turner of Camden, B.
Jeger, B.	Underhill, L.
Listowel, E.	Wallace of Coslany, L.
McIntosh of Haringey, L.	White, B.

Resolved in the affirmative, and amendment agreed to accordingly.

7.7 p.m.

[Amendment No. 61 not moved.]

Lord Hesketh

My Lords, may I suggest that this is a suitable moment for us to retire to dinner and return here at 8 o'clock? I beg to move that further consideration on Report he now adjourned.

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