Lords Sitting of 26 May 1988

Preamble
The House met at eleven of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Leicester.

Royal Assent
The Lord Chancellor (Lord Mackay of Clashfern): My Lords, I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified her Royal Assent to the following Acts:

Employment Act,

Scottish Development Agency (Oban South Pier) Order Confirmation Act.

New Car Sales
11.6 a.m.
Lord Rodney Lord Rodney asked Her Majesty's Government:
What are the latest figures for sales of new cars in the United Kingdom.
Lord Beaverbrook: My Lords, there were just over three quarters of a million new cars registered in the UK in the first four months of this year. This is an increase of 10 per cent. on the corresponding period of last year.
Lord Rodney: My Lords, I thank my noble friend for that Answer. Does he agree that the recent announcement of a new Rover model for 1989, with the consequent increase in the labour force, is an encouraging sign for the British motor car industry? Can he say what percentage of newly registered cars were manufactured in this country?
Lord Beaverbrook: My Lords, I agree with my noble friend that Rover's programme of new models is clearly encouraging for the British motor car industry as a whole. As regards import penetration, analysis of new registrations of passenger cars in the period January to April of this year shows that 54·5 per cent. were imported. In the corresponding period for last year, 49·4 per cent. were imported. However, I should say that the Ford strike undoubtedly had an impact on those figures, whereas during 1987 there was a drop in the percentage level of registrations of foreign-made vehicles.
Lord Williams of Elvel: My Lords, can the noble Lord tell the House what the current net annual increase in the total car population is, as opposed to sales for new cars? Having given that figure, can he then tell us how to avoid traffic jams?
Lord Beaverbrook: My Lords, that is an interesting point. I have all sorts of figures in front of me concerning new car production. However, I do not have figures relating to cars which are taken off the road or scrapped. If I can find those figures, I shall of course let the noble Lord have them. No doubt they
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will be of great interest to him. However encouraging the figures may be, I doubt whether he will get around much more quickly than he does at the moment.
Lord Fletcher: My Lords, can the Minister say what steps are being taken in central London and the central areas of other big cities to improve traffic conditions?
Lord Beaverbrook: My Lords, I must tell the noble Lord that that is another Question. The present Question concerns registration of cars in this country. Although that may have some bearing on traffic, the noble Lord's is another point.

Police Computer Systems Improvements
11.10 a.m.
Lord Gainford Lord Gainford asked Her Majesty's Government:
How they intend to use computer technology to assist the police in the fight against crime.
The Minister of State, Home Office (Earl Ferrers): My Lords, computer technology has already brought the police more effective systems for handling major criminal investigations, for deploying police officers and for recording and analysing crimes. There will be continuing development of this nature.
Lord Gainford: My Lords, I thank the Minister for that Answer. Does he have information on how computers can speed up identification of crimes and criminals?
Earl Ferrers: My Lords, the police national computer is being replaced at the moment. That will give it more capacity, which should result in the quicker retrieval of information.
Lord Mishcon: My Lords, does the Minister agree that the Question is very important in regard to the detection of crime and the saving of manpower? Can he give the House news about the development of at least three devices? The first device, about which the police are very keen, is AFR—automatic fingerprint retrieval—which is already in use in the United States, Canada and Japan. The second device is the electronic photofit, which is at an experimental stage in Hertfordshire but which is not in use generally. The third device is the very useful automatic notebook, known technically as the HHID—the hand-held input device.
Earl Ferrers: My Lords, as usual, the noble Lord, Lord Mishcon, has asked penetrating questions of detail. As regards automatic fingerprint recognition—AFR—I can tell him that the Home Office and the Metropolitan Police are working on that project. It is a pilot project for a national AFR system. So far as the electronic photofit system is concerned, I applaud the noble Lord for his detailed knowledge of those matters. The system has been on trial with the Lancashire Constabulary. We are considering whether the system will be suitable for use on the new police national computer. As regards hand-held

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input devices, which the noble Lord described as electronic notebooks, those are in use in many police forces. They cannot be used to access the police national computer and there are no plans to allow such devices to be used with the PNC.
Lord Harmar-Nicholls: My Lords, can we be sure that trained policemen are not being used to read the computers who could be better employed on the beat? Are civilians being used for that purpose?
Earl Ferrers: My Lords, all forces are engaged in a considerable civilianisation programme for the very purpose which my noble friend has mentioned—to put uniformed police on the beat.
Lord Mishcon: My Lords, while I thank the noble Earl for his customary courtesy, can the House be assured that these matters are receiving his urgent attention as a Minister with special responsibility for the police, because the police themselves to my certain knowledge are most anxious that they should be proceeded with with diligence?
Earl Ferrers: My Lords, the noble Lord is quite right to emphasise that point because improving the status and ability of the police to function properly is very important. He would like to know that £25 million was spent in 1986 on operational computer systems and very considerable work and expenditure are being put into computerising the police force.
Lord Elwyn-Jones: My Lords, can efforts be directed to finding a substitute for the term "civilianisation", which might put civilians off?
Earl Ferrers: My Lords, it is one better than "screenees" to which one of the noble and learned Lord's noble friends was subjected yesterday.
Lord Allen of Abbeydale: My Lords, since the Question looks to the future, is it worth putting on record that the police national computer has now been functioning for some 20 years and that originally the police themselves were very dubious about its benefits but since it was forced upon them they have come to value its contribution towards the detection of crime?
Earl Ferrers: My Lords, I am very grateful to the noble Lord for drawing your Lordships' attention to that fact. The police national computer is a very considerable asset. Apart from containing the names of criminals and conviction details and information on stolen or suspect vehicles, 33 million inquiries are made into it each year and 90,000 a day. There are 2,700 terminals connected to the computer, so it has a major impact.

Fire: Houses in Multiple Occupation
11.15 a.m.
Lord Dean of Beswick Lord Dean of Beswick asked Her Majesty's Government:
How many lives have been lost over the last 10 years in houses in multiple occupation and hostels
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due to the incidence of fire, and whether any measures are being contemplated to deal with this problem.
Earl Ferrers: My Lords, because of some change in the recording practice by fire brigades consistent information is available only from 1982. In the period 1982 to 1986 there were 432 deaths in fires in the UK in detached, semi-detached or terraced houses in multiple occupation and 23 deaths in fires in hostels or similar institutions. Her Majesty's Government will be issuing guidance on means of escape from houses in multiple occupation later this year. We are considering the way in which means of escape from fire can be included in future housing legislation.
Lord Dean of Beswick: My Lords, I am extremely grateful to the Minister for that very informative reply. May I ask him whether the advisory standards which are to be issued later this year will be mandatory or optional? If they are optional, is he aware that because of lack of resources many local authorities will certainly not implement them and the carnage suggested in the figures he has given today will continue? I do not think that that is what any of us in your Lordships' House or elsewhere wishes to see happen.
Earl Ferrers: My Lords, the guidance will cover within its scope some 80 per cent. of houses in multiple occupation. It will not have statutory force, but it is anticipated that it will help to raise the standards of means of escape in many more than 8 per cent. of the houses in multiple occupation upon which there is a duty to provide means of escape. A mandatory grant is available for up to 90 per cent. of the cost of the provision of means of escape from fire in those houses in multiple occupation which are required to have them.
Viscount St. Davids: My Lords, since the great majority of fires in such buildings are caused by overloaded electric circuits, can the noble Earl tell us how far it is now compulsory to have electronic residual current circuit-breakers fitted in those houses? Is that now compulsory?
Earl Ferrers: My Lords, the noble Viscount is very ingenious in putting his question, but I believe that if he thinks about it again he will realise that it is far outside the scope of the present Question. I should be delighted to answer if he would be kind enough to put down a Question specifically on electronic contact-breakers.
Lord Auckland: My Lords, I should like to declare my interest as a non-executive vice president of the Royal Society for the Prevention of Accidents. Has the Minister any evidence of unguarded electric fires and old-fashioned oil heaters, which I believe are illegal anyway, being in evidence in such properties? If so, have any recommendations been made concerning them at inquests into such tragedies?
Earl Ferrers: My Lords, the Question refers specifically to houses in multiple occupation and to

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hostels. I do not have the detailed information for which my noble friend has asked because it is outside the scope of the Question.
Lord Mishcon: My Lords, is not the answer to the question of houses in multiple occupation and hostels that they ought to be designated under the Act dealing with fire prevention and required to have a certificate as a result? Is the Minister aware that the greatest fire authority dealing with the problem, namely the one which covers the metropolis, is extremely anxious as a matter of policy that that should happen so that it can as a fire authority have proper liaison with the housing authority?
Earl Ferrers: My Lords, one of the problems which has been considered in drawing up the guidance is the connection between the Home Office, the fire authorities and local authorities. I think that the suggestion which the noble Lord has put forward would have considerable resource implications, but we are considering ways in which means of escape from fire can be included in future housing legislation.
Lord Dean of Beswick: My Lords, is the Minister not aware that I am somewhat disappointed at his answer to my supplementary question that there will still be a large number of properties for which the necessity to provide that type of accommodation without fire risk will be left to the mercies of individual local authorities? As he said, considerable resources will be necessary to bring those buildings up to standard.
The point I wish to make is that the more that provision is left as a non-obligatory function, the longer the risk will continue. Is the Minister further aware of the concern shown by authorities and associations which arc grappling with this problem? I know that they will be extremely disappointed to learn that there will still be some loopholes left should the advisory standards be as depicted by the Minister in his Answer.
Earl Ferrers: My Lords, local authorities can serve a notice under Section 366 of the Housing Act 1985 requiring the provision of means of escape from fire. There is a duty in respect of houses in multiple occupation of three storeys or more and with 500 square metres of floor area, and there is a discretionary power for local authorities in respect of smaller properties. At the moment the Government are not convinced that further powers are necessary and no authorities have said that they serve notice only where the duty applies. They appear to discharge their duties on fire safety as regards houses in multiple occupation outside their legal duty.
Lord Leatherland: My Lords, can the Minister say whether the expression "multiple occupation" as it appears in the Question covers the case of families who have a mother-in-law living with them?
Earl Ferrers: My Lords, I think that they would have to live in separate apartments within the same building and that there would have to be more than two of them.

Wheelclamping in London: Policy
11.21 a.m.
Lord Mackie of Benshie Lord Mackie of Benshie asked Her Majesty's Government:
Whether they are satisfied that the policy of clamping cars in London is operated in a fair and rational manner.
Earl Ferrers: My Lords, the operation of wheelclamping in London is a matter for the Commissioners of Police for the Metropolis and of the City of London. Officers have been made aware of the need to ensure that the power to clamp is used with discretion.
Lord Mackie of Benshie: My Lords, I thank the Minister for his reply. I must declare a personal interest, in that I was clamped in the space of six minutes while I was unloading my luggage and carrying it into the Farmers' Club in Whitehall Court. Although my indignation boiled over at that time, I put down the Question because I have discovered that a great many people have had similar experiences. Is the Minister aware that there is a general feeling that the civilians who are employed under the supervision of a police officer to clamp cars are either on a bonus or on quota? Will the Minister tell us a little more, if he can, about the system and how many people a police officer supervises? Can he say whether the story about quotas and bonuses is a fable?
Earl Ferrers: My Lords, I am very grateful to the noble Lord for having been generous enough to tell the House that he had an interest to declare and that he had only put down this Question on behalf of others who had suffered a similar fate! I am bound to say that when I saw this Question and was apprised of the fact that the noble Lord had been clamped, I thought that he could well have been reminded of the prayer, which he would have heard read had he been present for prayers, which says:
"We, having Thy fear always before our eyes and laying aside all private interests, prejudices and partial affections".
He was of course good enough to lay all those considerations on one side.
I can tell him that wheelclamping operations are carried out with sensitivity, though the person being clamped does not necessarily notice it. The Metropolitan Police have instructions which are sent out to all officers stating that officers engaged on wheelclamping duties are inevitably involved in a sensitive area of public relations and it is therefore essential that officers apply common sense and good judgment at all times. They also add that there will be many occasions when it will be necessary for police officers employed on those duties to exercise their discretion.
There is always a police officer in charge of a wheelclamping unit and no car is clamped before the officer concerned has given such authority.
Lord Boyd-Carpenter: My Lords, at the moment I am touching wood and hoping that I do not have an interest to declare and can therefore comply with my noble friend's theological admonition. Is he aware that clamping seems to be taking the place of the older practice of towing away? May I ask whether he and the Metropolitan Police appreciate that a clamped car that is obstructing traffic continues to obstruct the traffic for longer than it might otherwise have done, whereas once a car is towed away there is no further obstruction?
Earl Ferrers: My Lords, that is perfectly true, but towing away is a fairly draconian measure. It is undertaken on certain occasions. The number of wheelclamping operations which have taken place has risen considerably and this has been found to increase the rate of traffic flow. There are occasions when a car that has been wheelclamped still obstructs traffic, and it is then towed away.
The Countess of Mar: My Lords, has the Minister seen reports in the press last week about a police car that was answering an emergency call being clamped? I understand that it took the officer several minutes to persuade the person who had clamped the car to unclamp it.
Earl Ferrers: My Lords, there is an expression:
"The rain it raineth every day upon the just and the unjust person".
Lord Mishcon: My Lords, as someone who most likely will have to declare an interest as a consequence of asking this supplementary question, may I ask the Minister whether he is conscious of the fact that there is a general feeling among the public that much wheelclamping is done at random? Is he aware (though how in the name of heaven he can be I know not) that at about 6.15 p.m. yesterday near Russell Square I observed that a British Telecom vehicle had been clamped and heard the driver's language when he found it? It was somewhat disturbing. It appears that the vehicle was in that place in order to carry out some telephone repairs. Does he not consider that an example of that kind, which I personally witnessed, indicates that wheelclamping operations are done at random and somewhat carelessly?
Earl Ferrers: My Lords, we all have individual examples of how things appear to be not part of the norm. I am conscious of the anxiety caused by wheelclamping, but there is a real and serious dichotomy in this situation. On the one hand, the police have to make sure that the roads are kept clear and where parking offences occur they should be properly penalised. On the other hand, that must be done with sensitivity because the mere fact of clamping alienates the people who very often are the greatest supporters of the police. There is a delicate balance to be kept.
The noble Lord may not be surprised that I was not aware of what happened in Russell Square around 6 o'clock yesterday afternoon. He may have been surprised at the language of the British Telecom engineer. I wonder whether he heard the language of the noble Lord, Lord Mackie of Benshie, when he was clamped.
Lord Nugent of Guildford: My Lords, is my noble friend aware that there are many people who, in some streets at any rate, have found the movement of traffic to be somewhat improved as a result of wheelclamping? Does he appreciate that previous to that draconian punishment (which is what it is) the ordinary system of fines, which usually operates many months in arrears, was proving quite insufficient to stop illegal parking such as can be seen any day in London in hundreds of places? My noble friend is fully justified in introducing wheelclamping as a possible—I repeat possible—means of preventing illegal parking and thus freeing the streets of London for traffic to move through.
Earl Ferrers: My Lords, I am very grateful to my noble friend for putting that point so clearly. Perhaps I may say that he is quite right. There is a perfectly clear distinction made between places where one may and one may not park. Nevertheless, in all of us there is the element of the schoolboy and we all try to see whether or not we can get away with it. If one does not get away with it, one has really only oneself to blame.
Lord Underhill: My Lords, has consideration yet been given to the recommendations of the North Report? The report suggests that clamping might be extended to cases where the police constable sees that a vehicle is in a very dangerous condition or where there is no display either of a registered licence disc or an out-of-date one.
Earl Ferrers: My Lords, the North Report, only recently produced, has some very important recommendations. There are a great many of them. At present the Government are considering them and will in due course decide what to do.
Lord Mackie of Benshie: My Lords, is the noble Earl aware that I said, "Bother"? There is a serious point to my Question. It seems to be a firing into the pack method. It may be effective but it could be refined. Certainly the unloading time should be defined. Five minutes is far too little. If the computer could be used so that persistent offenders pay more, there might be some logic to it. The present "spray shot" method is alienating the public.
Earl Ferrers: My Lords, the clamping time is very clearly laid down. One is permitted to stop, or to load or unload, for up to 20 minutes. The courts have held that loading or unloading must be continuous. The Metropolitan Police observe private cars for five minutes for signs of loading or unloading before a wheel clamp is applied; and 10 minutes is allowed for commercial vehicles. Should the noble Lord, Lord Mackie of Benshie, go to the City, the City police observe for 10 minutes and 20 minutes respectively.
The noble Lord has a very good point. He is quite right when he refers to the alienation of the public from the police. I had the advantage of drawing this fact to the attention of the police yesterday at the meeting of the Association of Chief Police Officers at Eastbourne. I said that this was a matter that they have to take into account. However, in the end we

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must make sure that we do not alienate from the police those who are basically the greatest supporters of the police.

Dartford-Thurrock Crossing Bill
11.31 a.m.
Read a third time, and passed, and returned to the Commons with an amendment.

British Steel Bill
11.32 a.m.
The Secretary of State for Trade and Industry (Lord Young of Graffham): My Lords, I beg to move that the Bill be now read a second time. As I said in my Statement to the House on 3rd December last year, the British Steel Corporation has now reached the stage at which it would benefit from a return to a fully commercial environment. I said that legislation would be introduced in this Session to turn the corporation into a Companies Act company. The House now has that legislation before it and I should like to outline its main provisions.
The Bill is an enabling Bill. It paves the way for the subsequent privatisation of British Steel. The core of the Bill is to be found in Clause I, which provides for all of the property, rights and liabilities of the corporation to vest in a successor company. That company will be a Companies Act company set up for the purpose of vesting. The successor company will be limited by shares, all of which will be owned by the Government. The Government will then be able to offer their shares for sale to the public and thus privatise the successor company.
The Bill does not dictate the timing of the privatisation. That will depend on the market and the performance of the company. Our clear intention, however, is to return British Steel to the private sector as soon as possible. Nor does the Bill dictate the form in which British Steel will be privatised. We have, however, made it clear that we intend to privatise the successor company as a single entity and in its present plant configuration.
The Bill essentially provides therefore for a change in the legal status of British Steel from a public corporation to a public limited company. While the successor company will technically be a different person in law from the corporation, the intention of the Bill is that it should be regarded for all practical commercial purposes as the same company. The change brought about by the Bill is not intended to affect the commercial activities of British Steel nor the extent of its assets and liabilities
To complement this change of legal status the successor company will require a capital structure which is compatible with the requirements of the Companies Act. Clauses 2, 3 and 7 of the Bill provide for that capital structure and it may be of assistance to noble Lords if I briefly explain those provisions.
Clause 2 provides for the reduction and subsequent extinguishing of the public dividend capital of the corporation. A reduction in the corporation's capital
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is necessary to write off accumulated past trading losses and thereby achieve a balance sheet which more accurately represents the present value of the net assets of the company. It is important to understand that the accumulated losses are not debts. We are not talking about money that is owed to someone; we are concerned with losses which have been made in previous years, the accumulated total of which is recorded in the corporation's accounts.
It is open to any Companies Act company to apply to the court for a reduction in its capital in order to eliminate such losses, to enable it to pay dividends and, in the case of the successor company, to ensure that it may be registered as a plc. Since the corporation as a nationalised industry cannot apply to the court for such a reduction, this will be authorised under Clause 2 of this Bill.
The remaining public capital will then be extinguished, and will be replaced by securities issued under the provisions of Clause 3 by the successor company to the Government. To the extent that the total nominal value of the securities issued to the Government is less than the amount of the public capital extinguished, the balance will go to form a reserve, called the statutory reserve. The uses to which this reserve may be put are specified in Clause 7 of the Bill.
The statutory reserve is not a cash fund; it is a book-keeping entry which serves the primary purpose of ensuring that the balance sheet balances. Private sector companies generally have a mixture of share and loan capital and reserves. The process of restructuring the balance sheet of the corporation is, as I have said, complementary to the vesting provisions of the Bill. Instead of—as we have now—a nationalised corporation funded by public dividend capital, the successor company will be a Companies Act company with capital and reserves.
I must make it clear that the rearrangement of British Steel's capital structure prior to privatisation does not contain any element of subsidy nor does it contain any element of write off of debt. No cash changes hands as a result of the provisions I have described and the successor company is obliged to inherit all of the liabilities of the corporation.
The remaining provisions of the Bill are subsidiary and technical and I do not propose to delay your Lordships by discussing them further now. They are generally well precedented by previous privatisation legislation. My department will make available full explanatory notes to anyone who is interested or concerned.
Your Lordships will be aware from my previous statements to the House on this and other matters that my department is committed to the promotion and regeneration of enterprise in this country. We are firmly of the belief that nationalisation and public ownership of industry are inimical to the growth of enterprise.
The Morrisonian type of state corporation—a relic perhaps of a bygone era—is a cumbersome and unwieldy structure. It has been proved to be fatally flawed in that the different imperatives of the commercial and political worlds (to both of which it is subject) cannot be satisfactorily reconciled. That

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has been amply demonstrated by the history of the British Steel Corporation, and I think that most people would now accept that state ownership is unlikely to promote the efficient and competitive manufacturing of goods for the international market.
Not only is the political control imposed on state corporations inappropriate, but there also grew up a belief that governments could afford to ignore the market, and indefinitely maintain outdated excess industrial capacity. Again and again the history of the British Steel Corporation illustrates the folly of such a belief. It is simply not within the power of governments to roll back the tide of market forces and to preserve industries in a static form. The lessons have been learnt, and learnt painfully, that the only guarantee of success is to respond quickly and flexibly to the market, and to produce goods that customers want to buy at prices they are willing to pay.
British Steel fully understands that fundamental truth, and I congratulate the management and workforce of the corporation on the excellent results they are now achieving. Yes, it is true that the remarkable turnaround in the corporation's fortunes has been achieved within the public sector; but that has been achieved despite public ownership, not because of it. The Government have sought as far as possible to give the corporation the freedom to get on with its business and not to interfere in its commercial decisions.
The foundations of success have been laid and the first profits built upon them. But this is not the time for complacency. We must look to the future. The European steel market is well on its way towards complete liberalisation. It will come as no surprise to your Lordships that the internal market will be complete by 1992. Third world steel producers are increasingly making their presence felt. If British Steel is to prosper in this increasingly competitive environment, as I am sure it will, it must have the freedom and flexibility to take swift decisions, to adapt to the changing needs of the market-place, and to take risks; in short, it must be enterprising.
As I have said, I believe that public ownership inhibits the spirit of enterprise. The benefits that the Government's privatisation policy has brought to the economy are plain for all to see. This Bill is the first step in the process of privatising British Steel. As a private sector company, British Steel will be free to grow and prosper and to play its full part in contributing to the wealth of our nation. I beg to move.
Moved, That the Bill be now read a second time. —(Lord Young of Graffham.)
11.46 a.m.
Lord Williams of Elvel: My Lords, the House will be grateful to the Secretary of State for taking us through the Bill and for explaining some of the thinking behind it. I was grateful to him also for clearly specifying that the point of the Bill was to prepare for privatisation, although the Bill itself, as he remarked, is just a vesting Bill making sure that a public corporation becomes a plc.
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I am afraid that the noble Lord has failed to persuade us of the reasons for the change of ownership. He said clearly that the British Steel Corporation has done extremely well in the last two years under public ownership. He went on to say—I do not think I misquote him—that this was because the Government gave the British Steel Corporation freedom to manoeuvre and freedom to react to market forces. We on our side see no reason why this should not continue. I have yet to hear from any government Minister anything other than what I would regard as somewhat weary platitudes about the Government not being involved in any kind of industry.
If I were turning the argument on its head and the British Steel Corporation were now private and we were considering nationalisation, I believe I might even take the same view. This was not the case in 1967 when 14 companies were brought together. I believe it was right to do that under public ownership, but if a company is running successfully in the national interest and if it is in a competitive environment, as British Steel is and will continue to be, I do not see any great reason for changing ownership simply for reasons of dogma.
Since 1984–85 the British Steel Corporation has been a substantial success story. In productivity, just to take the Lanwern works, labour productivity to produce a tonne of steel has gone from eight hours to 2·8 hours today, and Scunthorpe is now at 2·86 man hours per tonne. In terms of export growth the 1986 overseas receipts came to about £1 billion. British Steel was the ninth largest foreign exchange earner in industry. In 1987 approximately 36 per cent. of total output was exported.
In technology British Steel has shown itself to be a world leader. The blast furnace at Redcar, for example, was rebuilt in 1986 right on time. In fact, it was put into commission slightly early. The Port Talbot hot mill in 1987 was commissioned early and without substantial teething troubles. In terms of product quality, there have been certificates of quality signifying complete confidence from some of the major steel consumers in the world who are operating in the international market, notably Caterpillar and Gillette. On reliability of delivery, customers now take it for granted that orders will be delivered, will be delivered on time and to the required specification.
I do not think anybody would now say, as they used to say of the British Steel Corporation, that it is the sick man of the European steel industry. In fact there is good reason to suppose that it may be the world's best steelmaker at present. By any standards the British Steel Corporation is now a success and this must be due to every person employed in the corporation, manager and workforce alike. One cannot say too often how much they have contributed and at a considerable price in terms of employment (we have to recognise that) to the present success.
So why are we now discussing the possible change of ownership which will upset an equilibrium which has produced such a success? We are doing it because the Government wish to do it and the Government

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have secured a majority for the Bill in another place. In your Lordships' House we have to accept that that will happen. I wish to point out some of the problems with privatisation, as we see them, that we shall be exploring in Committee.
There is the future of Ravenscraig. When the noble Lord made a Statement we had a short exchange about Ravenscraig. When my noble friend Lord Carmichael of Kelvingrove winds up from these Benches he will be referring to Ravenscraig in much greater detail. Secondly, why should the corporation be privatised as a single unit? We believe that there is need for a full and frank discussion of the pros and cons. We expect to go into that in Committee.
Thirdly, there is the problem of the quasi-monopoly position of British Steel. I accept that that question is linked with the future of the European steel industry and integration in Europe—indeed the integration of the steel industry on a worldwide basis and competition from Korea and other countries. That in its turn is linked to the sterling-dollar and sterling-Deutschmark rate particularly. It is said by a number of experts that in Europe there is a surplus of steel-rolling capacity of approximately 30 million tonnes. It is also said that there is a world overcapacity of approximately 100 million tonnes. We must be quite clear that reductions in capacity—if they occur, as they certainly must at some point—do not affect the operations of British Steel merely because it is privatised.
Steel is a particularly interesting form of primary industry because in the early stage it suffers from a downturn in the inventory cycle. When steel users see the projections of their sales for the future and they see a possible downturn, the first thing they do is to cut stocks of raw materials. Steel immediately feels the effect of that process. It is a most cyclical industry. Part of the problems that were suffered by the British Steel Corporation in the 1970s and early 1980s were due to that early attack on the steel industry as a result of turndown in economic activity. We must be clear in our minds that privatisation will not damage the status and activities of British Steel if such a downturn occurs.
We shall next wish to discuss in Committee at some length the question of the golden share arrangement. We shall wish to know exactly what the Government are proposing, what they proposed in another place, how it will work, whether the five-year limit is satisfactory, whether it is right to include that in the articles of association and what the status will be. I suspect that we shall ask for a preliminary draft of the articles of association of the successor company.
The next problem which we shall examine is that which was described by the Secretary of State. It is the writedown of public dividend capital. It is true that a company can go to the courts and write down its capital. It is true that after shareholder approval it can go to the court and reconstruct its capital in whatever way it wishes. The Companies Act is most flexible on the matter. Nevertheless, I am not entirely happy that the funding of the losses of British Steel, which was achieved through public dividend capital, should be entirely written off without some repayment, and possibly a total repayment, to those
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who provided the capital; in other words, the taxpayer. We shall be looking carefully at the matter to see whether that can be achieved.
According to the estimates of some analysts the Government will receive approximately £2 billion as a result of privatisation. I shall not insist on the figure; that is give or take the odd £100 million. Clearly that is nothing like the money that the taxpayer has put into British Steel to ensure that it is the success it is today. In that connection there is an issue which we must examine in Committee.
It was said in another place that the reserve created by Clause 7 of the Bill will be the equivalent of a share premium account. I am not entirely convinced that that is correct. I understand the clause; it can be paid out only in the form of bonus issue to existing shareholders. However, we shall wish to look carefully at that matter to make sure that it is not in the form of a simple distributable reserve.
All those are questions which we shall be probing at the Committee stage. However, they are questions of detail. The main questions which the Government still must answer are these. If it is not broken, why fix it? Why should we change the ownership of the company? Until we receive a satisfactory answer to those questions we on this side of the House will continue to believe that enterprising public ownership is a perfectly valid formula and that the British Steel Corporation should remain in its present ownership. Consequently we shall oppose the Bill.
11.56 a.m.
Lord Ezra: My Lords, for many years I was involved in an industry closely associated with the steel industry. I was able to witness at first hand the debilitating effect on the steel industry of the continued changes of ownership. I believe that it is a remarkable testimony to the ability of the present management that with that background it has achieved such a remarkable turn-round.
The noble Lord, Lord Young of Graffham, has explained that that turn-round has been due not only to the skill of management but also to the fact that the Government have tried to minimise their interference. That point was seized upon by the noble Lord, Lord Williams. As one who suffered from various government interference during my previous activities in a nationalised industry, I believe that that is a good development. Therefore in passing I should like to ask the Minister whether the same self-denial will be and indeed is being practised in relation to the remaining nationalised industries. I have in mind particularly the railways and coal. Who knows whether in this era of governmental self-denial, combined with the undoubted efficiencies in management, those two great enterprises may not soon break into substantial profit?
If there is to be a further change in the ownership of the steel industry—this will be the fourth in the past 40 years—we shall all need to be absolutely convinced that it is not only a sensible course to take but that effectively in our lifetimes it would be the last change. For it to be just another change to be

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followed by a further change at some later date would not be a serious way to look at one of our basic industries.
The noble Lord, Lord Williams, has expressed doubts as to whether a change is at all necessary. I do not go quite as far as that. I believe that one can approve of it if the change now contemplated can clearly be demonstrated to be in the interests of the industry and its customers, and if it can be regarded as having a long-term prospect ahead to enable the industry to utilise its undoubted technological skill and managerial talents.
I should like to deal with the question of timing. The noble Lord, Lord Young, said that the Bill does not lay down the time when the privatisation would take place; this is merely a first step. I believe that timing will be of great importance. The timing which is chosen must be in the best interests of the industry to enable it to perform its tasks. I doubt very much whether the present time is such a time, if that were being contemplated.
As the noble Lord, Lord Williams, has pointed out, there is still an overcapacity of steel-making in the world, particularly in the European Community. As regards the Community, a quota system is still in place and the form in which that system will be dismantled is by no means clear. Furthermore, the British steel industry has a substantial debt. The Minister pointed out that it will be no part of government policy to reduce the debt before privatisation. The industry will carry it forward. Should it not be given a little more time in which to reduce it before privatisation through its now profitable operations?
I believe that these are all questions that should be raised. In addition to the points raised by the noble Lord, Lord Williams, I believe that it will be proper to consider in Committee some of the points that I have just made. We are concerned with the future of one of the great industries of Britain.
Over the past 40 years it has been through a most turbulent time largely because of successive political interventions. The kind of future that we should like to see for the industry is one in which political intervention would be kept to the absolute minimum. The kind of structure that we should like to see is one that could be preserved in its basic features for years ahead. Obviously there would have to be changes from time to time to meet changing external circumstances. That should be the objective of our inquiry and, therefore, we shall be raising a number of detailed points in Committee in order to elicit the views of the Government on these points.
12 noon
Lord Diamond: My Lords, I start on common ground, which is always a good place from which to start. Every one on all sides of both Houses has given nothing but praise to the management and employees of this industry for the remarkable turnround in its results and for having demonstrated that it is now a reliable, viable company making good steel, good exports and good profits.
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The conclusion that I draw is that, given good management, one can secure good results whether the organisation is managed under the public or the private sector. This is not the only example we have, as everyone knows. The Government's conclusion is quite different. The Government conclude that inasmuch as the corporation has demonstrated its capacity to win not only domestic praise but worldwide praise for its achievements, it should immediately be privatised. The logic of that escapes me.
I further criticise the Government for their decision that the industry should be privatised immediately, notwithstanding that clearly that was not planned. It is neither referred to specifically in the manifesto for the last election nor even in the Queen's Speech for this Session. It was not fully prepared. For example, no time has been allotted for an examination of the alternative methods of privatisation so as to avoid a private monopoly, which is what the Government are proposing, notwithstanding that the financial market conditions are still very flat and notwithstanding that the legislative programme is already far too heavy. I am sure that your Lordships will recognise that and sympathise with my remarks.
The Secretary of State has made no case whatever for privatisation at the present time. Therefore, the sole conclusion that I can draw for this hasty action is obvious: namely, to keep the receipts from privatisation rolling into the Treasury so as to enable the Chancellor of the Exchequer to continue his tax reduction programme. However, because the Government have not justified the present step does not mean that no case can be made out. Provided that the timing is right and given a full examination of the best method of achieving effective competition, I believe that a case can be made out on the ground of motivation.
Perhaps I may explain what I mean as it is a matter of some importance. I take the view that what makes for efficiency in any undertaking is the fullest motivation of men and management concerned. That means a combination of personal financial reward and a sense of service to one's community. Both elements are present, albeit in varying proportions. In some spheres such as the Civil Service or the defence services, the dominant motive of those attracted to these services will obviously be service to the community. Therefore, the natural place for such an activity is in the public sector. Similarly, in straightforward commercial activities the personal reward, the profit motive, will be the dominant factor; hence, the natural place will be the private sector.
Steel seems to me to come into that second category and to fit best into the private sector. That does not mean that steel production is not a matter for public concern. On the contrary, any country desiring a strong economy will need its own steel-producing capacity. Just as it was right, in the interest of defence, for a Tory government to transfer an ailing Rolls-Royce into the public sector until it was strong enough to be returned into the private sector, so it was right for a Labour government to nationalise an ailing steel industry in order to maintain domestic steel production. Indeed, had that

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not happened there might well be no domestic steel industry left to discuss today. The measure of that need for protection is the several billion pounds that have gone into safeguarding its future.
Therefore, I conclude that the Government are right in principle to return steel to the private sector. However, I must say that it is no credit to the Government just because every time they consider a nationalised industry and dogmatically decide to privatise it that they should, on rare occasions, happen to be right. Nor is it any credit to the Government that they should attempt to do so prematurely. I say prematurely for the reasons I have already given, three of which are self-evident, and the fourth, that of being unprepared, is demonstrated by the fact that the issue of the golden share, in spite of its importance in protecting the new fledgling industry and in spite of continual pressure on the Government to make up their mind, was only decided three months after Second Reading.
Of far greater importance is the fact that the Government have not given themselves time to examine the various options and to come forward with their considered proposals for enhancing competition. Instead, in spite of the lip service so recently paid to the promotion of competition, the Bill simply provides for the transfer of a public monopoly into a private monopoly. Whatever may be said about competition from abroad, the fact remains that the British Steel Corporation will be a monopoly under the law. Clearly, we must return to both these issues in Committee.
It will also be necessary in Committee to consider much more closely the rights of employees. I know it has been said that the rights of employees are protected because their rights are automatically transferred to the new company which has to take over all the liabilities of the existing corporation. That is not a fair statement of the case. The new company is a plc and the "l" stands for limited. The new company will have a limited liability. In the present circumstances any pensioner who is in trouble over his pension claim will be able to sue an employer which has no limited liability. In the new circumstances if, for example, total steel demand drops unexpectedly and the company finds itself in difficulties, the pensioner will have a right to sue a liquidator to recover whatever he can out of the liquidation. That again is a matter which we shall have to consider very carefully when it comes to the Committee stage.
Therefore, we are left with the conclusion that the dominating factor has been the need to maintain the flow of privatisation receipts for the purpose, as we all know and as has been declared so many times, of enabling the Chancellor to continue his programme of tax reduction.
As I have said many times, there is nothing wrong in selling the nation's assets if one reinvests the proceeds for the benefit of the nation. Perhaps I may paraphrase rather freely what has been said recently in high places. What matters is what one does with the wealth so acquired. We know the answer: it is to reduce taxation in such a way that those with the largest incomes benefit most, so that the gap between
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the well-to-do and the needy is widened once more. That is where the Tory philosophy of today leads. Thank heavens, it finds no place in the philosophy of my party!
12.10 p.m.
Lord Wyatt of Weeford: My Lords, I feel that I must say a few words at the start of the funeral rites of steel nationalisation. There is no happier mourner than myself. During the 1964–66 Parliament the Labour Government had a majority of three. Desmond Donnelly and I knew that the nationalisation of steel was doctrinaire dogma which would cost the nation many thousands of millions of pounds, which indeed it did. We were able to force the Government not to nationalise steel during that Parliament. They had to wait until Labour won a substantial majority in 1966. Therefore, I suppose that between us we saved the nation about £300 million by that delay.
Nationalisation was the disaster that we predicted it would be. Actually, the majority of the Labour Cabinet knew that it would be, too, but they were too frightened of their ideological supporters to stop it. The old and charming theologian, Nye Bevan, had vividly but mistakenly described steel as one of the commanding heights of the economy which must be taken over by the state if the nation were to be prosperous. In those days to be against nationalisation of steel in the Labour Party was like a cardinal of Rome declaring a disbelief in the Virgin birth. However, I gather that Mr. Kinnock is now discouraging that approach, though the news does not yet seem to have reached the noble Lord, Lord Williams of Elvel. However, it is too late now for Mr. Kinnock to welcome me back into the Labour Party.
For long periods British Steel was losing £2 million to £3 million a day of the taxpayers' money. The record was achieved in 1980 when it lost £1·8 billion, including an operating loss of £700 million.
There was great interference by government even before nationalisation. Steelworks were started in the wrong places for political reasons in order to catch votes. For instance, the late Lord Stockton had the interesting idea for half a strip steelworks in Wales and the other half in Scotland. The management was not allowed to manage while there was a Labour Government—that is the answer to the noble Lord, Lord Williams of Elvel. It is only since then that management has been allowed to manage. If the industry ever fell back into the hands of the noble Lord and his friends, once again it would never be allowed to manage. The losses need never have been so high.
But since 1980 there has been a new atmosphere. Under Sir Ian MacGregor, Sir Robert Haslam and Sir Robert Scholey, management has been urged to do what it believes is right and to take no notice of foolish politicians. Sir Robert Scholey deserves particular praise because throughout that period he was also the chief executive. He has done a wonderful job. He is a steel man born and bred and he remains so today. He wants the industry privatised, too.

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British Steel has become a success story. Over the past three years it has received no money at all from the Government. Now it would like the commercial freedom to operate nationally and internationally that privatisation will bring.
Never again will British Steel be a charge on the taxpayer. As the noble Lord, Lord Williams of Elvel, said, it is now the cheapest producer of steel in Europe and possibly anywhere in the world. That is because management has been allowed to manage as it never was before—certainly not under a Labour Government. It will now build up wealth for its shareholders and for the nation. I am sad that Desmond Donnelly did not live to see the return of steel to the private sector. I feel that I am speaking for him as well as for myself in saying how delighted I am that this day has arrived.
12.15 p.m.
Lord Morton of Shuna: My Lords, I wish to speak about the Scottish aspect of British Steel and the effect of these proposals on industry in Scotland. The noble Lord, Lord Wyatt, surprised me because I thought there was, or had been, a finishing mill at Gartcosh which dealt with the strip from Ravenscraig. I had the impression that Gartcosh is in Scotland and not in Wales. It was only recently in the term of this Government that Gartcosh was closed and the strip has to go to Shotton for finishing. However, perhaps I am wrong and Gartcosh was always in Wales and we never recognised it.
The privatisation proposals appear to us to contribute nothing to the efficiency or competitiveness in the form that is proposed because, as has already been said, it is replacing a state monopoly with a private one. As noble Lords will be aware, there is a deeply-held view in Scotland that the Government and the present management of British Steel—perhaps also the noble Lord, Lord Wyatt of Weeford—wish to close Ravenscraig.
In another place, on Second Reading of this Bill, the Minister responsible said that that view had no basis in practice and that the management of British Steel was not hostile to the Scottish steel industry. However, if one looks at the facts it is very difficult to substantiate that view. The management has said again and again to committees in another place and elsewhere that they see no long-term future for more than two flat product mills. There are, of course, three; namely, Port Talbot, Llanwern and Ravenscraig. Over the past few years Port Talbot and Llanwern have benefited from major long-term investment at very high cost. There has been very little investment at Ravenscraig. What there has been has been investment which would pay for itself over
two or three years and which was necessary in order to keep the plant going. The major investment that is required on such items as the coke ovens is not forthcoming. Investments that would require 10 years to pay for themselves are being ignored.
Because of the lack of investment in the coke ovens, Ravenscraig is using up its coke at a greater rate than it can produce it and so is diminishing its stock. It is difficult to see that management consider that Ravenscraig has a future. The guarantee that the
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Minister gave when he announced the privatisation is only that the hot mill at Ravenscraig will exist until 1989, which is when the continuous casting plant at Llanwern becomes fully operational.
In the debate in another place the Minister at no time denied that the hot mill at Ravenscraig is to close next year. He has never denied that without the hot mill there is no long-term future for either Ravenscraig or Dalzell. There is no possibility of keeping those plants going merely to produce slab steel. It is for those reasons, which I have briefly summarised, that the Scots are very anxious indeed about these proposals.
Assuming that privatisation is to go ahead what are the alternatives? There is the possibility of introducing competition. British Steel will be a virtual monopoly in the production and marketing of steel. Why not introduce competition—a concept to which the Government so often pay lip service? They only pay lip service to that concept because this measure is not introducing any competition.
The Arthur Young report suggests that a Ravenscraig, Shotton, Dalzell combination as a separate entity competing with the rest of British Steel would be a viable proposition. That has been attacked by the Government because it is opposed by the unions at Shotton. It is rather new for the Government to suggest that they are dictated to by the unions. It also seems to ignore the views of the unions at Ravenscraig. Are the unions at Shotton to be regarded as more valuable than the unions at Ravenscraig and, if so, why?
The report is also attacked because the Government and British Steel refused to give Arthur Young confidential information. I agree with what the Conservative Member from Eastwood said—that that really is no defence when the Government will not reveal any of the information or say that any part of the Arthur Young report is wrong. It is also no defence when Sir Ian MacGregor whom the Government seem to regard as having had some experience in the steel industry and perhaps having done a good job, says that cost estimates can be synthesised from standard industry sources. That is just what the Arthur Young report has done.
But even without competition British Steel at the moment is running all its plants at full capacity and it has been doing so for some time. In addition it has been importing large amounts of strip plate and processed steel. It seems that at the moment British Steel can produce only about 60 per cent. of the United Kingdom's strip needs. That is partly due, no doubt, to the European Community quotas; but they presumably will not last for ever.
The desire to close Ravenscraig hot mill is not based on a lack of demand, at least not so long as the pound stays at a realistic level. It denies opportunity for the quick responses that the Minister said that the privatised firm would have because it is really a minimalist approach. It is being assessed on the basis of the minimum production that British Steel considers at the worst level it will require.
British Steel sells steel to Scottish users on the basis of transport costs out of Glasgow. If Ravenscraig closes will transport costs still be assessed from there,

1025
or will they be assessed from South Wales? The demand for steel in Scotland is projected to increase from the 1990s onwards, largely due to an upturn in oil-related work. Will steel users turn to foreign steel? If so, what effect will that have on the balance of payments?
It may be suggested that Ravenscraig is far from the market and from the ports. But that is not true. Strip has to travel from South Wales to Shotton or from Ravenscraig to Shotton, and those are similar distances. Hunterston to Ravenscraig is a similar distance as Port Talbot is to Llanwern. But Hunterston is a deep water facility which can take far larger quantities of materials than Port Talbot ever could.
British Steel is already the largest importer of steel in the United Kingdom. In a monopoly position it will be able to exert tremendous power on other steel stockholders. Why should it continue to manufacture steel at all if it can increase profit from its stockholding by not producing but by importing? Is that in the best interests of the United Kingdom? Is it in the best interests of industrial users of steel in Scotland?
If steel has to be privatised, surely it should be done on the basis that it is creating competition and not a monopoly? Surely the Archbishop of Canterbury is right to say that while wealth creation is good it should be for the service of the common interest. If we are going to ignore the interests of Scotland altogether, is that not a bad reason for doing it this way?
Even on purely economic grounds, if the Government do not care for any other grounds, is it not necessary to take into account the figure of 12,000 who will be unemployed if Ravenscraig is to close, because that has a sheer obvious economic cost to the Government? That should be taken into account. On the basis of this privatisation there is deep worry in Scotland.
12.25 p.m.
Lord Carmichael of Kelvingrove: My Lords, this has been a debate which shows that we shall have a most interesting Committee stage on this Bill. I look forward to that. A great deal of material has been produced both in another place and by outside bodies on the whole question of this privatisation. Some of the speeches we have heard today were very knowledgeable on the subject. After the speech of my noble friend Lord Morton of Shuna there is little that needs to be said about Ravenscraig. He has been most analytical and he made a very powerful speech altogether.
British Steel and steel has always been an emotive question in Britain to all parties. It was at one time very high on the present Government's privatisation list. But it was not even mentioned in the election manifesto or even, as the noble Lord, Lord Diamond, said in the Queen's Speech. Having listened to the noble Lord, Lord Wyatt of Weeford, and having been there on the night when he and Desmond Donnelly refused to vote on the issue, it makes me wonder how he fought the 1964 election. That issue
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certainly appeared in the Labour Party manifesto in 1964. At that election he won his seat, but after that he soon changed his mind about this matter.
Lord Wyatt of Weeford: My Lords, I do not know how the noble Lord can suggest that I changed my mind. In 1962 I wrote a long article in the New Statesman and Nation saying that on no account should steel be nationalised as it would be a disaster for the country and for Labour. I made it quite clear to my constituency party and to the voters in my constituency that I was going bitterly to oppose the nationalisation of steel because it was ridiculous. I did not deceive anybody, nor did I change my mind.
Lord Carmichael of Kelvingrove: My Lords, I am in no doubt that the noble Lord did write a pamphlet about this subject. I have one or two of the pamphlets that he wrote for Tribune just a little earlier. They made interesting reading too. The noble Lord fought the election undoubtedly on the 1964 manifesto. I do not know whether that manifesto contained an opting out clause. I certainly did not have one when I fought the 1964 election.
But when British Steel announced good half-year profits of £190 million the Government made clear their intention to privatise the industry. That profit of £190 million for the half year followed a whole year profit for 1986 to 1987 of £187 million. The profit had more than doubled. As the Minister for Trade and Industry made clear in his statement in another place on 3rd December:
"This is an impressive improvement in the corporation's performance".—[Official Report, Commons, 3.12.87; col. 1107.]
The Bill before us today does not tell us a great deal about how the Government see the future of this basic industry, except to say that the corporation would be floated as a single entity. The Ministers on the Front Bench opposite will be familiar with our bemusement that, when an undertaking has become successful, usually by the injection of a great deal of public money, the Government decide that the private sector can then take over and reap the benefits.
I believe that the noble Lord, Lord Diamond, dealt with that aspect of the matter very fully when he said that as the industry was doing so well he did not see the need to privatise it, unless the money received from privatisation—as it has been put in other cases "selling the silver"—will be ploughed back into the pocket of the nation.
We suggest that British Steel is more than just another company. It is in every sense of the word a strategic industry which despite 1992, and our greater involvement in Europe by that date, must remain within the control of the United Kingdom Government. We do not know in detail what will happen to the quotas in 1992 in Europe, although this is probably something that will come out. They may even be totally abolished. However, I find it most difficult to believe that Germany, Luxembourg and France will completely accept the elimination of such quotas. Nevertheless, the Minister will be able to tell us whether any of the European steel-producing countries have allowed, or are likely to allow, any

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meaningful part of their steel industry to be controlled by outsiders. However, I think that theme has already been dealt with by many other noble Lords in today's debate.
The House will perhaps remember the debate on the privatisation of the British Airports Authority, when the issue of the golden share was discussed and an amendment was put forward by my noble friend Lord Underhill and myself. The arguments raised in that case apply equally to the case of steel privatisation. Briefly, it was felt on all sides of the House, and reinforced by a most powerful speech by the noble Lord, Lord Boyd-Carpenter—unusually in support of the noble Lord, Lord Underhill, and myself—that a foreign owner of the British Airports Authority, who also had interests in major Continental airports, could make the decision to cut back on investment—an example was given of Heathrow or Gatwick—in order to make his own personal neighbourhood airport. It must be recognised that such people are swayed by political pressures just as much as people on this side of the Channel. It was further suggested that such a person could allow British airports to deteriorate so as to make the neighbouring airports—such as Schiphol, Paris or Brussels—more profitable and desirable.
In my view, the same argument applies to steel. It would be quite easy for a sufficient foreign ownership to obtain control of British Steel and allow it to run down to their benefit and most certainly to the great detriment of the British people. In another place the issue of the Kuwaiti stake in British Petroleum was raised. It was suggested that the Government's apparent indifference to what was happening to British Petroleum was not a good omen for this type of flotation. The suggestion was made that something more akin to the Rolls Royce solution should apply—namely, the possibility of using the 15 per cent. limit on overseas shareholding—which would be much more likely to be effective. The noble Lord, Lord Williams of Elvel, raised the matter and I think it is one that we shall undoubtedly return to.
We should like to know whether the Government accept that proposition as an important protection to allow this industry, which is vital to our defence and our industrial interests, to remain within British control. The steel industry has always been cyclical. We must endeavour to produce a solution, whether or not it is within privatization—which in any case the Government, with their majority, will obviously have—to ensure that in the long term the investment needs of the industry are secure.
I now return to the speech of my noble friend Lord Morton of Shuna. He pointed out the problems of Ravenscraig and the fact that the coke ovens are producing only because of the heroic efforts of the workforce and the technical people involved in the works. It would be so easy for Ravenscraig to be undercapitalised and therefore become a candidate for closure. I suggest that that could happen to the rest of the steel industry in Britain if it so suited a private ownership and if they were allowed to sell their shares in British Steel abroad and thereby lose control of the British steel industry.
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I think that is just as doctrinaire as was the suggestion that we were anxious to nationalise in 1964. It has been said by many people that the 14 companies were in an absolutely chaotic state and therefore it was vital that they should be pulled together. I am open to the idea that now that British Steel is in a much better and healthier position, because of an enormous investment of taxpayers' money and great effort on the part of management and workforce, new methods other than the Morrisonian method of overseeing are necessary. I think we all realise that there were great deficiencies in that method. Looking back to the time of those chaotic industries, such as British Steel and British Rail, it was the only way to solve the problem. However, we have moved on from that stage and we should like to discuss some of those methods in Committee.
12.35 p.m.
Lord Beaverbrook: My Lords, we have had a most interesting debate this morning and I am most grateful to the noble Lords who have participated in it. The British Steel Corporation has often been the subject of debate in this House and, all too frequently, at times of difficulty for the industry. However, I am happy to say that the Bill now before us will be the first step in taking British Steel out of the hands of politicians and returning it to the commercial domain where it truly belongs.
The noble Lord, Lord Williams, mentioned several issues to which we shall no doubt return in Committee. Of course they are important issues and will be explored here as indeed many have been explored in another place. However, I should like to respond especially to the noble Lord's question concerning the reasons for privatisation. The noble Lord intimated that in his view there was no other reason for privatisation than a matter of ideological theory—ideological dogma. I cannot agree with him. I sincerely believe that the history of the steel industry over the past 40 years represents the clearest possible reason for the Government's desire that this great industry should sit in the private sector. On the one hand, the industry must be spared the burden of political interference; on the other hand, if it is to prosper and flourish, it needs the freedom and the flexibility of the private sector. The Government fully accept the vital importance of the nation's steel industry.
The noble Lord, Lord Carmichael of Kelvingrove, mentioned that he believed steel to be a strategic industry; of course it is a vital industry. It is our strong belief that a return to the private sector will enable it to play the fullest part in continuing the wealth of our nation. The sooner the steel industry is no longer a football between government control, the private sector, back to public ownership and now privatisation (its fourth move), the better. In our view the industry should sit in the private sector where managers can manage and where they are freed from the constraints and other pressures of government.
I turn now to the speech of the noble Lord, Lord Diamond. I am most grateful to him for his praise of the industry: producing good steel, a good level of

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exports and good results. The noble Lord asked whether there were any alternative methods of privatisation, perhaps to avoid what he described as a "private monopoly". I must say that in the steel industry in this country there is considerable competition, and British Steel will remain subject to the discipline of competition. After all, consumers will continue to be free to buy their steel from foreign producers.
Where appropriate, regulatory regimes have been set up in other privatised industries whereby the company concerned has had a legally protected monopoly. However, British Steel has no such monopoly, and a regulatory regime is therefore inappropriate and unnecessary. British Steel is already subject to European Coal and Steel Community rules. Within the Community we are working hard towards greater liberalisation of the steel market in Europe. This is the point raised by the noble Lord, Lord Carmichael.
Lord Diamond: My Lords, is it not the case that British Steel plc will control more than 25 per cent. of the production of steel? Is that not under the law as it stands a monopoly?
Lord Beaverbrook: My Lords, the production of steel in itself I do not believe to be a monopoly under the law. There are other overseas producers which are already well represented in this market. It is a completely different case from that of the earlier privatisations such as British Telecom.
I was about to say to the noble Lord, Lord Carmichael, with regard to his point about 1992, that all steelmakers are subject to normal Community rules and our own competition rules. Therefore I believe that there are adequate safeguards. I should like to say that 1992 is going to impose challenges for the industry and for British Steel. We believe that taking away the restraints of government from the industry will help in the industry's preparation towards that very important date.
The noble Lord, Lord Diamond, made a point which I have heard him make on a number of previous occasions about the Chancellor of the Exchequer needing the receipts and using them in order to reduce taxation. I believe that the way the economy of this country has improved in the last few years is an excellent example of the very great benefits from lower taxation. The economy is going again and it is going because the people that are the shakers and the movers are motivated and doing what they are best at.
I understand the concern of the noble Lord, Lord Morton of Shuna, about the Scottish position and that that concern is uppermost in his mind. British Steel has given its commercial assessment of its requirements based on an honest and thorough assessment of future market demand. In the December statement British Steel said that it expected that, subject to market conditions, there would continue to be a commercial requirement for steelmaking at Ravenscraig and at the other integrated plants for at least seven years.
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At the end of the day employment is ultimately only protected by successfully meeting the changing requirement of the market. British Steel is profitable now because it has taken the necessary steps to produce good quality steel. It needs to be free to continue its efforts to be as efficient a steelmaker as possible if it is to maintain its present position. We can be quite sure that its foreign competitors are not standing still.
The corporation has made it clear that subject to market conditions there will continue to be a commercial requirement for steelmaking at Ravenscraig for at least the next seven years. The exact level of output will obviously depend upon the exact level of market demand that has to be set, but the assurances given in the December statement stand today.
I should like to add one further important point with regard to the issue raised by the noble Lord, Lord Morton of Shuna. He asked about investment in Ravenscraig. British Steel has invested steadily in all of its plants over the years, including the recent £15 million investment in coal injection facilities at Ravenscraig. There is no question of there having been a deliberate run-down of Ravenscraig.
Lord Morton of Shuna: My Lords, will the noble Lord not accept that that investment at Ravenscraig is merely a stop-gap measure and cannot he regarded as a long-term future for the coke plant, where much more basic renewal is required than this stop-gap which will hold together for only a few years?
Lord Beaverbrook: My Lords, it is a matter for British Steel to come to a decision on what is required by way of investment in the plant, but even the Arthur Young report confirms that there is no need for any substantial capital expenditure in Ravenscraig, in Dalzell or in Shotton over the next five years.
The noble Lord, Lord Ezra, brought to our attention a number of important points. He particlarly mentioned the timing of privatisation. At the moment it is far too early to give him any assurance as to when that might happen, but we have made it clear in the past that our policy is to return the corporation to the private sector as soon as practicable. British Steel is now in a position where privatisation is feasible and it is right to take the necessary steps to enable that to happen. That is what we are doing today. The Bill, as has already been said by my noble friend the Secretary of State, does not dictate a time for privatisation but our intention is that British Steel should be privatised within the next two years and as soon as is practicable within that timescale.
I should like to welcome the support of the noble Lord, Lord Wyatt, for the measures that we are taking today. I am well aware of his past involvement and of views that he has expressed. I believe the noble Lord, Lord Ezra, said that he hoped that this privatisation of the industry would be the last time in our lifetimes that there would be any tampering with the status of the industry. This has been going on for quite a long time. The first nationalisation was not in my lifetime. I am not that young, and no doubt the

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noble Lord will probably outlive me. I believe that the industry will rest better where it is now going to be as a result of the Bill that we are debating today.
Lord Williams of Elvel: My Lords, I should like to ask the noble Lord a question about the draft articles of association of the new company which I mentioned. As he is aware when the Gas Bill was before your Lordships' House, we had draft articles at the time that notes on clauses were distributed. Will that be the case now?
Lord Beaverbrook: My Lords, I understand that that will not be the case but I shall look into it and let the noble Lord know the full reasons for whatever the decision will be.
The Bill is a short and largely technical one but there is no doubting its importance. I wholly agree with noble Lords who say that steel is an industry of great significance to the economy. That is not in doubt. We do not, however, consider that because an industry is important it in some sense follows that it should be in public ownership. As my noble friend the Secretary of State said when he opened this debate, public ownership of the productive sector of the economy has not delivered the success which was promised of it. Indeed the reverse is true. It has been very clearly demonstrated that government intervention cannot keep market forces at bay.
The nationalised industries would have undoubtedly been better able to cope with the changing demands of the market if they had had the commercial freedom and discipline imposed by the private sector. Steel is no exception; 30 years of movement in and out of the public sector brought it to the edge of an abyss and made it an enormous drain on the nation's resources. Happily, recent years have seen a renaissance of the commercial spirit of this country. British Steel has shown what can be achieved. The corporation has worked hard to produce what the customer wants at the right time and at the right price. It has dramatically improved its efficiency and the quality of its products. As a result, British Steel is now a world leader. The time is now right for British Steel to return to the private sector.
The private sector is the right place for a successful and dynamic commercial organisation, and that is where it would be best placed to meet the challenges which lie ahead as competition in the steel market increases. While a privatised British Steel will be owned by its shareholders, the prosperity which I have no doubt it will enjoy will benefit the whole nation. The Bill paves the way for privatisation of the corporation. I commend it to your Lordships.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Health and Medicines Bill
12.56 p.m.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Skelmersdale): My Lords, I beg to move that this Bill be now read a second time.
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Back in November last year I was privileged to repeat a Statement in your Lordships' House about the publication of the Government's White Paper on primary health care, Promoting Better Health, and announcing the introduction of this Bill in another place. The publication of the White Paper marked the first major review of the primary health care services since the start of the NHS 40 years ago. It set out our plans for radical improvements in the pattern of primary care services. It is aimed at achieving a shift in emphasis from the treatment of illness to the promotion of health and the prevention of disease; raising standards of care and making services more responsive to the needs of the consumer; and improving value for money.
The White Paper set out the strategy for a radical transformation of the primary care services. The Health and Medicines Bill takes forward this strategy in two important ways: first, by providing powers to implement specific proposals (for example, to reimburse GPs for the costs of training practice nurses); and, secondly, by allowing us to introduce the new arrangements for the dental and optical services which will provide the resources required to allow many of the proposals in the White Paper to go ahead.
The Bill of course goes wider than primary health care but I should like to begin by discussing the Government's strategy for radical change in the primary care services and the way in which this Bill takes forward that strategy.
The White Paper plans for promoting the better health of the nation will require substantial extra resources. As the White Paper states, we now spend over £5 billion on the primary care services. That is in real terms £1,500 million more than in 1978–79—a full 43 per cent. What this means is, for example, that in Great Britain since 1979 we have seen an increase of nearly 4,000 in the number of GPs to 32,000; an increase of over 50 per cent. in the number of GPs' support staff, with the number of practice nurses nearly trebling; a 19 per cent. increase in the number of courses of dental treatment to 37 million; the computerisation of all 90 family practitioner committee patient registers, and the implementation of computerised call/recall systems for breast and cervical cancer.
The number of community psychiatric nurses has doubled in the past five years and we expect this trend to continue.
These figures show the Government's commitment to primary care. Published plans continue this trend and show very large real-terms increases for the future. By 1991, we plan to spend 11 per cent. more on these services—some £600 million of additional funds.
Prevention of illness and promotion of good health are central to our primary care strategy. Planned prevention measures, which I wish I had time to dilate upon at length, do not need legislation. However, the effective development of a preventive approach depends not only on the doctor but on other members of the practice team. Our concern to strengthen and improve the practice team lies behind Clause 16 of the Bill. We propose to release more funds to enable GPs

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to take on staff with skills which could extend the range of services provided by a practice. This could mean additional practice nurses, counsellors, chiropodists or physiotherapists. In some inner city areas, linkworkers with people of ethnic minorities could be recruited.
But obviously, for the new developments to be useful, the arrangements need to be flexible and geared to locally determined needs and priorities. We propose to remove current restraints on the type and number of team members whose salaries can attract direct reimbursement, and Clause 16 will replace these rigid constraints with a new and more flexible system under which each local family practitioner committee or health board determines its own needs and allocates funds according to its priorities, within a cash limited budget. As I said, more money will be available in this area. Through Clause 16 we aim to ensure that it is targeted efficiently and effectively in each locality.
Clause 15, meanwhile, will strengthen practice teams by clarifying and extending the scope for reimbursing the cost of training staff. We intend, for example, to arrange for GPs to be reimbursed for the training costs of practice nurses and for financial recognition to be given to those who provide clinical training for undergraduate medical students.
These changes will establish a substantial shift towards prevention and an improvement in the quality of services. The standard of GPs' premises can also help enhance the quality of service to the consumer. To achieve this we will increase the assistance available to doctors in improvement grants and under the cost rent scheme. Again, we will look to FPCs and health boards to direct the extra funds to the areas of greatest priority within an overall budget allocated under Clause 16.
Also of relevance to GP premises are Clauses 1 to 6, which concern the General Practice Finance Corporation. As we announced in the White Paper, our intention is to change the constitution of that body in order to allow maximum use of private sector funds. These clauses give effect to that intention. We see no reason to maintain the existence of a public sector body to lend to GPs when the private sector has in recent years shown itself perfectly capable of doing the job.
I have dealt at some length with health promotion and prevention and improving the quality of services. Another central plank of our strategy is to make services more responsive to the needs and wishes of the consumer. I can be briefer here because our proposals do not require primary legislation. We want to increase the quality of service and choice for the consumer. This will come in part from the changes I have already mentioned, but also through our proposals for publication of more information about services through practice leaflets and annual reports, from making it easier to change doctor and easier to complain if services are not up to standard.
Before leaving the family doctor services I should like to mention Clauses 8 and 9, which deal with the retirement of practitioners. One of the effects of the proposals we are discussing is to add to the already exacting responsibilities of GPs. The Government
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have come to the conclusion that it is not reasonable to expect doctors to carry on working under NHS contracts beyond an age when they are able to continue to bear those responsibilities fully. The Bill therefore gives powers to introduce a compulsory retirement age. It also gives powers to end the 24-hour retirement provision under which doctors can retire at 65, draw their pension, and return to work a day later without any reduction either in pension or pay. Both these proposals are widely supported and should lead to higher standards of service and increase opportunities for younger, vocationally trained doctors, who are generally more willing to work as members of primary care teams, to enter general practice. The provisions also apply to dentists.
The themes of prevention, quality of service and
consumer power are equally relevant to dental services. Recent years have seen a dramatic improvement in the dental health of the nation. In the 10 years to 1983 the proportion of 5 year-olds with no dental decay almost doubled from well under a third to well over half.
For 12 year-olds the proportion nearly trebled. In
1968, 37 per cent. of adults had no natural teeth. By
1985, only 22 per cent. of adults had no natural teeth. We believe that putting into effect the White Paper policies could help towards a further major decrease in dental disease especially dental caries.
Preventive policies are best directed toward the young. The general and community dental services are playing an increasing role in dental health education with individual patients and providing preventative therapy such as fissure sealants. We want to see this work continue to expand. Clause 10 of the Bill takes a major step in this direction. It helps broaden the scope of the community service and gives it discretion to redirect resources away from routine treatment of schoolchildren—who can generally be looked after in the general dental service—towards providing health education. They will also be able to concentrate more on providing services for groups with special needs such as elderly or mentally handicapped people.
We will also be launching, in conjunction with the profession, a campaign to promote dental awareness and regular attendance. This campaign will be directed particularly at young people in inner cities where the standards of dental health still lie some way behind those in the rest of the country. These steps will, we believe, have a major impact over the years ahead. Dental health will continue to improve and the amount of disease will fall.
The second theme is again quality of treatment. The department has long helped patients by monitoring the quality of service provided. This will be ever more important in the future. Clause 12 of the Bill provides increased powers for the newly named Dental Practice Board to survey and research and to deal with those dentists whose work appears at variance with those standards. The White paper also announces our intention to consult the profession about a new counselling and monitoring service of dental practice advisers. They should provide a valuable additional resource at local level to assist

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practitioners and to enable family practitioner committees to promote better dental services in their areas. In addition, the major expansion of postgraduate education and training announced in the White Paper should assist dentists in developing the use of the most modern preventive and therapeutic techniques.
I turn now to consumer power. To increase consumer power, we intend to encourage dental practices—like medical practices—to provide leaflets about the services they provide. We will be discussing this with the professions. In these ways, and with greater liberalisation of the advertising restrictions agreed by the General Dental Council earlier this month on dentists, we are confident that patients will be better informed and will be able to make an informed choice of dentist. And we might hope to see dentists competing on service, if not price.
We will also be spending more money to improve eye care services. For example, we will be extending the voucher scheme to adults who frequently break their glasses because of mental or physical disability, and providing a domiciliary sight-testing service to the housebound of modest means. The value of vouchers for those who require complex and hence more expensive lenses was given special consideration in last April's review to ensure that these people are not placed at a disadvantage. And the voucher can now be used towards contact lenses if the patient wishes.
A recent NHS disciplinary case has demonstrated that the present legal provisions may be inadequate to protect consumers against sight tests in which no proper eye examination is carried out. Although we believe that the vast majority of optometrists do both test for the need to wear spectacles and for the general health of the eye, we accept the need for ensuring consumer protection. As a result, the Government added to Clause 14 in another place. This now also allows for regulations to specify what tests should be carried out in a sight test. Such regulations will, of course, be discussed with the profession, but I can assure your Lordships that we are not envisaging a rigid set of rules which would constrain professional judgment.
In describing the improvements to the primary care services, I have naturally concentrated on those services covered by the Bill, but more will be spent across the whole primary care field. These additional resources have to be found from somewhere. The White Paper made clear that, after a careful examination of priorities, we feel that it is reasonable to find some of them from within the general ophthalmic and general dental services.
On sight tests, the effect of Clause 13 is to confine free National Health Service sight tests to particular groups, broadly those entitled to vouchers for glasses. Others would have private sight tests. About one-third of the population—some 19 million people—will still be automatically entitled to a free National Health Service sight test. And in another place my right honourable friend the Minister for Health announced the Government's intention to provide help to people on incomes just above the automatic qualifying levels.
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The removal of the restrictions on the sale of glasses in 1984 had what I can only call a wondrous effect. Greater competition in this field has benefited consumers as prices have fallen. For example, budget-priced glasses have become increasingly available, some for as little as £10 to £12. The opticians, too, have benefited as sales of glasses have increased by around 10 per cent. and the number of sight tests by about the same. The number of registered opticians has increased by about 500.
On this evidence, we would expect any charge to be very modest. But even if the charge were as high as, say, £10, most people go to the optician only at intervals of two to three years. We do not believe that for those not entitled to a free National Health Service sight test, such a sum would deter them from having their sight tested. It amounts to a little more every two or three years than the average family spends on alcohol in one week.
Nevertheless, concerns have rightly been expressed in relation to diabetics. Diabetics are at risk of developing diabetic retinopathy and need to have more frequent eye examinations to pick this up at the earliest possible stage. My right honourable friend announced in another place that we intend to offer free National Health Service sight tests to diabetics referred to an optician by a doctor. Similar arrangements will also be made for glaucoma sufferers. On glaucoma, I can report to the House that I have sought the advice of the Association of Optometrists and the British College of Optometrists on an agreed programme involving a slightly longer timescale than we are likely to have for this Bill. This will add around three-quarters of a million people to those eligible for free National Health Service sight tests.
I have said that we also intend to generate extra income from dental charges. But we are doing much more than that. We are carrying through a major reform of the dental charges structure. Part of that reform is already in place. Since April, the situation where treatment might be charged to the patient at anything between 25 per cent. and 100 per cent. of cost has ended. The effect of the changes introduced in April is that all charges will be at or about 75 per cent. of cost, subject to a maximum charge of £150. In relation to charges for dentures and bridges, Clause 11 will allow us to do this much more simply by relating charges directly to cost.
The change to this new system is something for which the profession has been pressing long and hard. A recent British Dental Association press release summed up the position rather well. It stated:
"The new system will be simpler and easier for patients to understand; and fairer for regular attenders who require little routine dental treatment … The Association is pleased to see that its recommendation to Government for a proportional charge system has finally been adopted."
The other major element in Clause 11 is the introduction of a charge for the dental examination. The dental examination is an increasingly important part of the service provided by the dentist, and includes advice on prevention and oral hygiene. For one-quarter of courses—about 8 million—it is the only service needed. Many of these patients can afford to pay a small contribution towards the

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service—some £3 at current rates. And for those who do have some minor treatment, the examination charge will in many cases be at least offset by no longer having to pay the full cost of treatment up to £17. We estimate that about 2 million courses a year will be cheaper than they would otherwise have been.
I would also remind the House that we will only expect those who can afford it to contribute towards the dental examination. All the existing exempt grounds will be maintained. Very nearly 40 per cent. of the population—21 million individuals accounting for nearly half of dental treatments—will be exempt from all charges. And as a result of the recent changeover from family income supplement to family credit, which has a much broader coverage, the numbers exempt as recipients of this benefit will nearly treble to over three-quarters of a million. Help will also continue to be available to people just above the threshold for automatic exemption.
There is one further point I should mention before leaving Clause 11. In response to concerns expressed in Committee in another place, the Government were pleased to put forward an amendment which exempts 16 and 17-year-olds in work from charges for dentures and bridges. As a result, this group will be exempt from all dental charges.
I should like to move outside the sphere of primary care measures to cover the remaining clauses. Several of these are rather technical or tie up loose ends. Clause 17 anticipates the integration of the artificial limb and appliances service into the NHS in 1991 and ensures that staff who choose to transfer to the health authorities as a result of the reorganisation maintain continuity of employment—clearly a good thing. Clause 20 confirms the current structure of fees for licences that are issued under the Medicines Act 1971.
Clause 19 fills a gap in the Secretary of State's rather limited powers to make grants for the training of local authority social services staff in England and Wales, and will enable us, for instance, to put resources into training for dealing with child abuse—a matter much in our minds at present. Clause 18 puts into legislation an agreement, made in 1974, that local authorities should not charge health authorities for the use of hospital social workers. The resources were transferred at that time, and there is no reason why the anomaly should continue in legislation.
Finally, I should like to turn to Clause 7. This is directed at giving health authorities more freedom to raise income for the good of the health service. It will also give health authorities more freedom in the way that they set private patient charges, and give them responsibility for setting charges for overseas visitors. We expect income generation eventually to raise at least an additional £70 million for health authorities to spend on improved services. When our proposals were introduced there was a good deal of suspicion about them, but most informed opinion seems to have come round to our view that it makes sense to increase the resources available to the NHS in this way. NUPE, for example, now sees much to commend the proposals. I think the Health Service Journal got it absolutely right recently when it said
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there was little chance of reversing the move towards increased income generation because,
"The opportunities to improve life for patients and staff are just too great".
In conclusion, the White Paper set out our strategy for promoting better health in this country by increasing consumer power and improving the quality and quantity of services and, most of all, by moving from the treatment of illness to the promotion of health and the prevention of disease. The Government believe that the Bill before us forms an important part of this overall strategy, gives health authorities more freedom to generate income to improve the NHS and makes important changes in the social services and medicines fields. I therefore have no hesitation in commending it to the House.
Moved, That the Bill be now read a second time.—(Lord Skelmersdale.)
1.13 p.m.
Lord Ennals: My Lords, I start with a small apology. I am at the moment under treatment for a chest infection and should not be here. I was very determined to be here but if by any chance I have to leave before the end of the debate, bearing in mind that my noble friend is replying, I hope that those speaking in the debate will understand.
When the Government published Promoting Better Health on 25th November I thought it was a fairly hopeful document, designed to make the service more responsive to the needs of the consumer, to promote health, to prevent illness, to raise standards of care and to improve value for money—to quote the statement made by the Minister.
The Bill before us today frankly does the opposite. Most of the good ideas are not in the Bill though I hope that they will reach fruition. Because of the cash-limiting of primary health care and the imposition of charges for most sight tests and most dental examinations, it will make the service less responsive to the needs of the consumer. It will lead to lower standards of dental and optical care, and in those respects it will lead to lower standards of care and reduce value for money, exactly the opposite of what the Minister said. Only time will tell.
Of course there are certain decisions which I welcome. For instance, the decision to introduce a statutory retirement age for doctors and dentists in Clause 8. That is a very sensible proposal. I certainly welcome Clause 17 about the continuing of employment for the purpose of employment protection, as the Minister has outlined. I welcome the statement made by the Minister in another place, Mr. Newton, on Second Reading that there would be £600 million additional expenditure on primary health care; but I have to admit my doubts about any such promise if it is a real-terms increase. I notice that the Minister, unless I missed part of his speech, did not allude to a figure for additional expenditure.
If one checks the figure against a real-terms increase and sets against it the additional revenue for charges for dental treatment and sight tests and the decision to cash-limit each family practitioner committee, one asks whether more money is really

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going to be spent. Certainly cash-limiting, in the experience of the health authorities, does not produce as much money as they want. It may produce as much money as the Government decide they ought to have, but it is not as much money as they want.
When I heard this statement from the Minister about all this extra lovely money, I naturally turned to the Financial Memorandum, and perhaps I may quote from it:
"the changes relating to Family Practitioner Services … are expected to produce significant net savings on public expenditure despite some expenditure on compensation to be incurred under clause 8 and a potential postponement of liability to Corporation tax occasioned by clause 6. These savings include considerable savings on the Public Sector Borrowing Requirement arising from the provision within clauses 1–6 relating to the General Practice Finance Corporation. The manpower implications are not expected to be significant".
I hope that when the Minister comes to reply he will try to square this strange circle. The Financial Memorandum says that money will be saved and the Minister says that more public money is going to be spent. I wonder which is actually the fact. No doubt the Minister will make it clear when he comes to reply.
There are a number of neutral items on which I should like to ask for more information before coming to the more controversial points. Clause 16, concerning reimbursement of expenses, provides for a cash-limited grant to family practitioner committees from the DHSS to reimburse those providing family practitioner services for various expenses—presumably principally taking on additional staff within GPs' practices, as was suggested in the White Paper. One would welcome that; I do not object to it at all.
The Minister may well know that the Royal College of Nursing is seriously concerned with the potential implications of this clause as it affects nurses. The White Paper clearly sets out the intentions of the Government to encourage primary health care systems based around GPs' surgeries. The provisions of this clause will encourage GPs to take on extra primary care staff, chiefly community or practice nurses, as outlined in paragraph 3.45 of the White Paper, though that is in some contradistinction to the statement on manpower in the Financial Memorandum.
The difficulty for the nurses—and I hope the Minister will answer this question—arises over what I think are very imaginative proposals in the Cumberlege Report for nurse-based teams, which may well deal increasingly with the elderly, infirm or terminally ill patients who find it impossible to get to the surgery. One asks whether they will benefit from the clause dealing with reimbursement of expenses.
Another nursing problem is that of nurse prescribing. The primary health care White Paper states:
"The Government also sees merit in giving nurses more freedom to prescribe a limited range of items (such as dressings, ointments or medical sprays)… The Government will consult the Professional Standing Advisory Committees about the professional and ethical issues of prescribing by nurses".
As I understand it, most of the bodies which have been consulted warmly support that suggestion. We
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on these Benches also support it, and I think it will become even more apparent, as the qualifications of nurses increase, that nurses will have a professional qualification for prescribing in certain limited sectors. I had hoped to find something in the Bill about that matter. Perhaps the Government will produce something at a later stage of the Bill. If not, perhaps we can help them by doing so on their behalf.
The Minister touched on income generation. I have no argument in principle against health authorities raising additional revenue by offering goods and services to patients and their visitors so long as it is extra money which is to be on top of their cash limit. However, I do not wish to see health authorities busy themselves raising money by some means—hairdressing, shops and so on—and then finding that because they have extra money their cash limits are reduced to ease the burden on the DHSS. I hope that we can be assured that that will not be so.
There are also some methods of raising money which I should oppose. It has been suggested that there should be advertising on nurses' uniforms, rather like that used by some football clubs. Although that might well be attractive, I do not think that it is advisable. I would also object to the selling of tobacco products on hospital premises. I hope that the Minister will be able to assure me that he will also get his fags somewhere else! More seriously, perhaps I may ask him what sort of body will be established to vet the many different proposals. We do not want our hospitals and their entrance halls to look like tourist attractions or local bazaars. There must be standards and I should like to know how those will be maintained.
Turning to Clause 15, which deals with the remuneration of GPs for clinical teaching and training of their own staff, I do not object to that proposal. However, I ask why it should be a perk which is confined to GPs. If there is to be an additional payment, should not that be extended to other teachers in primary health care, whoever they may be? Surely nurses should be included. If it is limited simply to GPs, that would seem to be an anomaly which we would seek to remove in the Committee stage of the Bill.
Perhaps I may turn for a few moments to the two issues which have created concern throughout the country and have led to a major revolt of Conservative MPs. I was going to say that it has led to "revolting Conservative MPs", but perhaps that would be misunderstood. There is certainly a revolt in another place concerning sight test charges and charges for dental examinations. However, I should first like to raise a question about Clause 10 which removes the community dental service's statutory duty to screen schoolchildren for dental disease. We are very worried about that matter.
The community dental service carries out a screening service in schools which is acknowledged to be cost-effective and efficient. It promotes dental health at an early age and therefore stimulates demand in children which carries forward into adulthood. The community dental service also has an important role in health education, in preventative medicine and the epidemiological monitoring of dental health changes. Increasingly health

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authorities, faced with difficult choices in expenditure, are making cuts in the community dental service. Many authorities have admitted that and have agreed that their proposals are not concerned with patient care but only with saving money.
While those authorities recognise the importance of the CDS, financial pressures have forced them to make economies, and in some cases the cuts are now as much as 40 to 60 per cent. Several health authorities are considering abolishing the CDS completely. With the removal of the statutory obligation to screen shoolchildren for dental disease which is proposed in the Bill, it seems certain that that sector will be the one to which health authorities turn for savings. Can the Minister give some guarantee that the community dental service will be properly retained in a statutory form? The most important age in dental care for children is when they are at school and anything which takes away the obligation upon local authorities is to be very much regretted.
Clause 10(2), states:
"the Secretary of State has the power to provide"—
he has the power but he need not necessarily provide it—
"for the dental inspection at appropriate intervals".
The clause does not state what is appropriate or who shall determine what is appropriate. What about opted-out schools? Perhaps the Minister can comment on that matter.
Turning to sight tests and examination charges, in my view that is another serious inroad into the basic principles of the National Health Service which have stood over the past 40 years. This is the first change of that nature which has dug its way into the dental health services. I suppose that we have all been wondering when it would happen in terms of both sight tests and dental examinations. The Minister quoted the British Dental Association on that subject. The BDA has said that dentists believe that free access to advice is one of the fundamental principles of the National Health Service. Charging for examinations will deter some patients from having regular dental care and their dental health will suffer as a result.
It is also important to remember that dentists are not merely concerned with teeth but are experienced practitioners in all forms of oral health. Serious general health problems with oral symptoms are often identified for the first time at routine dental examinations. Among the general health problems which dentists may diagnose are AIDS and other severe immunological diseases, cancer of the mouth and of the bone, serious blood disorders, food allergies, severe skin diseases, salivary gland diseases, infections of the mouth, and so on. A whole range of important conditions may be diagnosed in a patient who may not have had any symptoms of those diseases. I submit that to impose any charge, be it only £3 for those who live on modest incomes (it should not be assumed that all those who are on modest incomes are covered by exemptions), is not justified. The dentists believe that that would act as a deterrent. The Minister must argue that view with the
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dentists. I also believe that it must be opposed in the strongest possible way.
That is especially true for the elderly. I have before me evidence which has been given by Age Concern. It says that:
"Regular dental inspection is needed for all elderly people to identify pathological changes in tissue, and for those with dentures to check for wear and detect changes in tissue and bone structure which in time will affect the fit of dentures".
They feel very strongly about that and have sent me a number of publications, studies and surveys which I believe strongly argue their case and that case will be argued from this side of the House. I hope that the Minister will listen to our arguments because those views are held not only by us but also by those who are concerned with the needys of need people and especially by the profession itself.
The parallel mischief affects the free sight test. I shall not say a word about ready-made spectacles because I think that that is something which the noble Lord, Lord Winstanley, will do. I am likely to support some of what he says. I say "some" because I have not yet heard him.
I am very worried about the likely effect of the proposed fees for sight tests. They have been bitterly opposed by the Federation of Ophthalmic and Dispensing Opticians, the Association of Optometrists, the BMA, Age Concern and the Royal National Institution for the Blind, who have written to say that there are about 146,000 registered blind people and 82,000 registered partially sighted, of whom 40,000 are on income support and 75 per cent. are pensioners.
I believe that this is an extremely important issue. For the past 40 years the principle of free access to the National Health Service for primary care has stood without challenge. In this proposed legislation the Government intend to maintain the free eye test for children, people receiving social security benefits, the blind and partially sighted as well as the additional categories which they introduced in another place, of diabetics and those with glaucoma. One welcomes that move. The effect will still be that almost two-thirds of the population will in future have to pay for their eye tests. That includes 6½ million of the country's 9 million old age pensioners. Most of them watch their expenditure. I do not say that they are all on the bread line, but certainly they do not want additional expenditure.
Approximately 12 million eye examinations were carried out last year under the National Health Service. Approximately 1 million of those eye tests resulted in either referrals or notification to the patient's own GP because of the suspected presence of abnormality or disease.
There is very strong feeling among those who know best. It is the practitioners who have the daily experience of dealing with patients, and that applies both to dentists and opticians. It seems to me that that provision offers a second indication in the Bill, or maybe a third, that the allegations made that the government are an uncaring government are true. I think it is miserable that, in terms of sight tests and dental examination charges, they should particularly pick out those who are most needy. I deeply regret that.

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I have read all the replies given by Ministers in another place on both of those major issues and I find none of them satisfactory. I hope that your Lordships will take the same view. From these Benches we shall oppose these discriminatory measures with all the power that we can muster.
1.24 p.m.
Lord Winstanley: My Lords, I must begin by following the example of the noble Lord, Lord Ennals, with an apology. Shortly before I entered the Chamber I discovered that I had left my diary in somebody else's office about two miles away. I am paralysed if not actually speechless without my diary and I hope that noble Lords will understand if I absent myself briefly during the course of the debate to retrieve it. I hope that it will be accepted by those noble Lords of whose speeches I shall be deprived the pleasure of hearing, that no disrespect is intended.
I must also follow the example of the noble Lord, Lord Ennals, in thanking the Minister for such a clear exposition of the purposes of the Bill and for doing so so very briefly. The noble Lord will know that I welcome warmly many of the steps which he has outlined. I think that he will agree with me that I would not be serving the best interests of this House if I now went over all the points about which we are in agreement.
It seems to me from all the correspondence that I have had on this Bill and indeed on others—I have had a great deal, and I have here just a small selection—that there is a widespread impression outside your Lordships' House, and occasionally, I feel, shared by some noble Lords in your Lordships' House, that we cannot raise amendments at later stages of the Bill on various points unless we have flagged up all those points in the Second Reading debate. Nothing is further from the truth. We are entirely free to move any amendment about anything at later stages. I do not think that it is necessary for us to outline or detail them or to have a first go at the arguments during Second Reading. Nevertheless, I think that it is a matter of courtesy that I should list some of the points of my anxiety so that the Minister is forewarned.
To get a general impression of the nature of a Bill—and I have read this Bill very carefully right through—I feel that one cannot do better than to take a careful look at the Explanatory and Financial Memorandum which comes at the beginning of the Bill. That indeed I have done. Studying the financial part of that opening memorandum, if I may paraphrase it, I found that broadly speaking it says that this Bill will, in the end, clearly be beneficial to the public sector borrowing requirement. When dealing with health and the National Health Service my suspicions are aroused when someone tells me that the measure will be of great benefit to the public sector borrowing requirement.
I understand what the noble Lord has said about the prospects of income generation. Much of it I applaud and welcome. I also understand that it is wise to make the best use of those resources we have, and that if we can save money we should do so. I shall
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just make the general point that what the National Health Service needs is more resources and more money; it does not need an exercise to protect the public sector borrowing requirement.
That leads me back to my main concern, which has been mentioned in some detail by the noble Lord, Lord Ennals; namely, the general question of cash limits contained in Clause 16 and other parts of the Bill. I accept that that is in a limited sense only, but it seems to me that this could be the thin end of a very thick and damaging wedge.
Cash-limiting family practitioner services seems to me a very difficult principle. I do not believe that this Government or any government can predict with accuracy what illnesses which people will have, and at what cost in future years. It is an exercise which is doomed to failure. We know what has happened in the past. When the family practitioner committee services have overspent or spent more than the Government expected, the Government had to make savings. The only place they could make savings was in the cash-limited part of the service, so they made a 5 per cent. cut in the hospital budget. The inevitable consequence was that greater burdens were laid on the family practitioner committee services, so that the following year they were overspent by even more; then one had another 5 per cent. cut in the hospital budget.
That is a ludicrous situation; one which, I entirely agree with the Minister, could not be allowed to continue. The logical development of it would be that, in the end, there would be no hospital budget left from which to make a 5 per cent. cut in order to compensate for the loss. I wish to make the general point that I see what is being done and that it is being done to a very limited extent. But I hope that it will not turn out to be merely the thin end of a much thicker wedge. I think that there are great dangers with regard to cash-limiting family practitioner services and the domiciliary services.
That leads me to some of the correspondence I have had. I was interested in correspondence which has taken place between Sir Mark Richmond, the vice-chancellor of my former university, and the Secretary of State in Sir Mark's capacity as chairman of the Committee of Vice-Chancellors and Principals of United Kingdom Universities. It deals with Clause 7 of the Bill, which proposes changes with regard to research conducted in universities which has been funded by the Department of Health and Social Security.
I have always been very proud of medicine in that medical research is open. I would say to noble Lords that if today in the Soviet Union they discovered a cure for AIDS, tomorrow we would all know about it. That is what should happen with regard to medical research. However, now I think—or so Sir Mark Richmond appears to think from his correspondence with the Secretary of State—that we have a different arrangement. When some important medical discovery is made as a result of research which is conducted in a university and which has been funded by the DHSS, there may be some kind of "freezing" of the results of that research until the DHSS has decided how much it can make out of it before it is finally released. I shall not say much more about that

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matter now, but I have drawn the noble Lord's attention to the correspondence and I hope that at a later stage he will study it carefully.
The Minister mentioned that Clause 20 refers to the Medicines Act and certain matters related to it. A number of pharmacists have alerted me to the fact that Section 66 of the Medicines Act, which gives pharmacists greater freedom in relation to what they can do as regards drugs, has never been implemented. Since certain sections of the Medicines Act are related to this Bill, I wonder why Section 66 has not been implemented. It is something that pharmacists feel would be very helpful and would give them, as professional people, greater freedom with regard to certain drugs.
That remark leads me to the point made by the noble Lord, Lord Ennals, as to why we are not enabling nurses to prescribe more freely than they now do. I know that there was a time when the nursing organisations did not care for such a suggestion and did not want the responsibility. However, I have recently received letters from the Royal College of Nursing stating that that is something that the college would like to see done. It seemed to me, when I was in general practice, to be quite a ludicrous situation that if I had an elderly patient who had a varicose ulcer which was being dressed regularly by the community nurse, that nurse would come round to my surgery, ask me for a prescription for A, B, C or D—for this that and the other, and would tell me what to write. I would write that prescription and she then would go round to the pharmacy and obtain the prescription and apply the medicaments to the ulcer. He or she is a professionally trained person so why should they not be able to prescribe? That is the point made by the Royal College of Nursing. I am sure that in the course of our discussions on this Bill it will be considered further.
I too am much concerned about the question of charges. I shall not say very much about the dental service because I am absolutely certain that if I am here during the speech of the noble Lord, Lord Colwyn—and I think that I may be—I should agree with every word that he says. He has explained his anxieties, and as a professional person I agree with everything that I think he will say. No doubt he will be supported by the noble Baroness, Lady Gardner of Parkes, but we must wait to see.
As regards dental inspections, there appears to be a contradiction to which the noble Lord was recently alerted by his noble friend Lord Trafford. There is now a situation in which we are encouraging screening. If a general practitioner undertakes certain screening practices he is paid for them, but if a patient goes to be screened then it is the patient who is charged. There is a contradiction there which has already been drawn to the attention of the Minister and I am sure that he will look further into the matter. However, I am sure that I shall agree with what the noble Lord, Lord Colwyn, will have to say to the House shortly.
With regards to eye tests, I welcome the Minister's remarks on the subject of diabetics, which is a very important concession. It is a matter about which many diabetic patients have been extremely worried. Noble Lords are aware, I think, that I intend to move
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an amendment in regard to eye questions about which there may not be total unanimity, even on my own Benches. As I have explained before to noble Lords, I have always taken the view that to require an elderly person, who merely wishes to have magnifying lenses and nothing else, to have a full ophthalmic examination before being able to buy those lenses, seems to me to be exactly the same as requiring someone to have a full orthopaedic examination being being allowed to buy a walking-stick.
I do not wish to be misunderstood. I greatly value the services of opticians. As a general practitioner I relied very heavily on my local optician and I had a close professional relationship with him. He carried out detailed examinations of my patients with great efficiency, which I am sure was to both their benefit and mine. I should like that to be fully understood.
I also believe that some of the examinations that were done were, while I am not critical of them, nevertheless quite cursory. I welcome steps that will make sure that the ophthalmic examination carried out by the optician is a fuller one so that it will become more of a screening process than it is now. Nevertheless, I think it wise to give notice to the House that I shall be tabling an amendment at a later stage to provide that spectacles which contain identical lenses of certain diopters which are purely for magnifying purposes, should be exempt from the controls which now exist. I also wish to consider facilitating the ability of people to obtain a spare pair of contact lenses without going through the present difficult administrative procedures which are an obstacle to them.
I have merely listed one or two matters with which I am concerned. I shall be speaking more fully about them during our discussions at later stages of the Bill. I come back briefly to what I said at the beginning of my speech. Initially I cannot be totally happy with a Bill concerned with the National Health Service if I am told at the very outset that it will be immensely helpful to the public sector borrowing requirement. That is not my main concern, and I am quite sure that it is not the main concern of the noble Lord, either.
1.45 p.m.
Lord Hunter of Newington: My Lords, I also should like to apologise to the House since I may have to leave before the Minister replies to the debate. Unfortunately I have an important engagement in Birmingham which I feel I must not miss. I should like first to congratulate the Minister and the noble Lord, Lord Ennals—who, I see, is fast disappearing from the Chamber—as well as the noble Lord, Lord Winstanley, for what has been a very comprehensive review of this subject. The question that arises in my mind is whether there is anything left to talk about.
When I read the Government's White Paper Promoting Better Health I was most attracted, as others have been, to the proposals contained within it. It seemed right that the Government who in 1973 had damaged the organisation for the delivery of public health by removing the medical officer of health should take some steps toward putting right that damage. Having spent a little of my life in

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medical education and realising what a skilled job it is, I began to wonder, having read the document, where the people were to come from in family practice who would discharge some of the new and important functions when the doctors' terms of service with relation to their role in the provision of health promotion services and prevention of ill-health were introduced.
Nurses have been mentioned, and I wonder whether it means that a greater stooging role is envisaged for nurses or a new specialised job for them and others. That is something which is in everybody's mind and which is central to the success of the whole issue. The Bill that we are discussing does not help in any way. I should like to ask the Minister a question which he may partially have answered earlier: will the proposals of the White Paper be implemented as proposed, even though some of them are not considered in any way from the financial point of view in the Bill that is concerned with health and medicines?
I realise that one is dealing with lumps of money and independent contractors, but this is a whole area which is very vague and it is the area on which the success or failure of those proposals will depend. An important part of the White Paper's proposals which is not mentioned in the Health and Medicines Bill concerns the reorganisation of the family practitioner committees so that they will have a more active role in the organisation of primary care services, recognising that their new status enables them to collaborate on equal terms with other agencies. What does that mean?
The Bill that is before us deals with additional powers for financing the health service and the dissolution of the General Practice Finance Corporation, which has not yet been mentioned in this debate. The Bill discusses the provision for private medicine, which I welcome, and considers the controversial proposals which it is claimed will save money. The proposals concern both the optician's responsibility for eye testing and the dental services. I propose to say something about the first matter but to make only a very brief mention of the second.
I am told by the experts that if free eye testing does not continue, the patient may complain to his doctor about eye problems and then be sent to the hospital out-patient department where treatment is given free. The writers of this document seem to see the hospital services and general practitioner services as operating in different compartments.
A brief examination of what has happened in the
hospital ophthalmology department will I think show the relevance of their interdependence. There has been a revolution in the past 20 years in eye departments with laser technology and corneal transplants and other changes. There has been an enormous improvement in the help that the departments can give the seriously ill; and there is more in the pipeline. Under these circumstances, it would seem that any patient who can be dealt with outside the hospital should be so dealt with, and the best people to do this are the opticians. All available resources in hospital ophthalmology should be
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concentrated on developing these new services. There is an urgency about this because there are people who can now be cured who could previously not be cured.
I was interested that the White Paper talked at some length—and rightly—about the pharmacists and their new role. I believe that the Government are losing a very great opportunity in not extending the use of opticians in relation to eye problems. My experience is that they are absolutely first class at quickly detecting anything that is wrong. They are, and should be, the general practitioners of the eye services. Every step should be taken to have patients adequately examined by them away from the hospital which, as I have said, must be primarily concerned with resources for the treatment of the sick. I would therefore question the wisdom of the proposal to save money on eye testing. Do the people who have drafted this Bill really understand about this revolution and the urgency of using the skilled professions allied to medicine? I ask the Minister: do the Government see domiciliary eye services as part of the whole provision of optical services or as something separate from the hospital activity?
On dentistry, as has been said, it is vitally important that the school dental service continues to teach the young about the care of their teeth and to detect any defects that they may have. They have to have a good diet and a good toothbrush; and they have to use fluoride toothpaste.
On several occasions in the past three years I have expressed my regret in this House that family practitioner services are not firmly linked with the district health authority. We now have a situation where the Government are proposing to increase substantially the powers of the family practitioner committees. I have to admit, however, that the increased status and authority given by their direct link to the Secretary of State has resulted in remarkable improvements in the conduct of affairs in many areas. There would seem to be two possible ways to go. However, there are certain basic factors which must be met which are vital to the situation. The first is co-terminosity with local authority boundaries of responsibility. Recent events—the Griffiths Report, for example, make this even more important. The noble Lord, Lord Mottistone, has spoken eloquently in support of this. This automatically existed until 1973 in the days of the medical officer of health. We must somehow or other achieve co-terminosity of responsibility between the health authority and the local authority so that they can work hand in glove.
The second important factor is the greater involvement of nurses, pharmacists, opticians and others in the delivery of diagnostic and therapeutic services in practice. This means to me a substantial transfer of responsibilities. One does not hear about this when one hears about the practice nurses. Can the Minister tell us whether there are plans, proposals, or educational programmes arranged; or will it be left to the independent contractor who is employing these people to decide what their responsibilities are; or what they are to do?
There are so many activities that they can now undertake which allow the family doctors time to continue their central task of assessing and advising

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their patients. We all know that in recent years the doctor's ability to talk to his patient, to assess the case to make the very important decisions, and to discuss them with the patient has become threatened. It is better that he hands over many of his technical responsibilities to allow time for this task.
The third factor is this. The team has to deliver a better and quicker service, as the Minister has said. We must now resolve the problem which was so clearly understood by Lord Dawson of Penn's report in 1920 entitled Future provision of medical and allied services. This report proposed the establishment of health centres as part of a comprehensive programme of community and personal services involving doctors, dentists, pharmacists, nurses, health visitors and opticians. Whether this should come about under the district health authority or under family practitioner committees is the question. But in my mind there is little doubt that it should happen and would put us in the best position to progress into what could be a cheaper, as well as a more effective, service than the traditional approach. I ask the Minister whether he agrees.
1.56 p.m.
Lord Colwyn: My Lords, it seems that apologies are in order this afternoon. Mine are that I missed the first part of the Minister's speech. However, I assure him that I shall stay to the end although I shall slip out for a sandwich, having missed my lunch.
In general, I am supportive of the main provisions of this Bill, in particular those parts which should encourage preventative medicine and health screening, and those in which I have a special interest as a practising dentist which directly affect dentistry and the provision of dental care.
Out of five speakers on this side of the House this afternoon, two are practising dentists. My noble friend must therefore be prepared for some fairly heavy arguments against Clause 11 which proposes charging for dental examinations for the first time. I must agree with the noble Lord, Lord Ennals, that my profession believe that free access to advice is one of the fundamental principles of the National Health Service and that paying for dental check ups would deter patients from having regular dental care.
I am sorry to disappoint the noble Lord, Lord Winstanley, but this afternoon I drew the short straw and my noble friend, and dental colleague, Lady Gardner, will deal with this aspect of the Bill in more detail. I look forward to hearing her speech, and I feel sure that most noble Lords will agree with her.
I agree that no government have done more for the funding and organisation of the NHS—despite the fact that it is clearly a fallacy to believe that the injection of ever increasing cash will provide all the resources that are required.
Your Lordships will know that, since the inception of the NHS, the contractual service—the general dental service—has provided the great majority of dental care very economically. However, the high street dentist has no ability to look out or to seek out needs. This means that there are a number of groups of patients for whom the general dental service, as presently structured, cannot readily provide the
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treatment. These include some pregnant and nursing mothers, the elderly and the handicapped or housebound.
Fortunately, these groups are provided for by a complementary service—the community dental service. This community dental service grew up out of the old school dental service which provides for the screening at appropriate intervals of all children in maintained schools. It also provides treatment for the children of non-attenders. Screening has been a significant factor in the overall improvement of children's dental health which is acknowledged in the White Paper.
The screening process is cost effective, promotes dental health at an early age and so stimulates demand in children and then in the adult years. This happens irrespective of whether treatment after screening takes place in the general dental service or the community dental service.
In addition, as a public health service, the community dental service collects epidemiological information on disease levels within the community. It also provides prevention and health education both on a group and an individual basis.
The way forward for dentistry and for the future provision of dental care has been investigated carefully during the 1980s by a number of groups. The Nuffield inquiry and the dental strategy review group immediately spring to mind. The British Dental Association developed a paper on the future role of the service. In all of these reviews there was general agreement as to the way forward. This was that the community dental service should continue to develop as a complementary service; and that it should direct its role towards those areas where services are needed most.
I join the British Dental Association in recognising that the Government's long-term aims for the community dental service are very similar to those held by dentists. However, I am concerned over that part of the Bill which seeks to remove the statutory duty to provide school screening. The Government's view appears to be that it would be beyond their scope of authority for the Secretary of State to issue guidance to health authorities to target the community dental service towards care of priority groups, and towards a complementary role to the general dental service, unless the present duty over screening is removed. However, I believe that this well-intentioned change would cause more problems than it would solve.
Increasingly, health authorities faced with difficult choices in expenditure are trying to make cuts into their community dental service provision purely to save money. Many have openly shown this and some have admitted that there was little or no regard to the needs of patient care. Some 40 authorities, seeking to go down this route over the past two years, have been persuaded to modify inappropriate cuts because of the statutory duty. With the removal of the obligation to provide dental screening in schools, it seems inevitable that health authorities will turn to the community dental service savings.
In those parts of the country which are well supplied with general practitioners, the community

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dental service already concentrates more on services other than the routine treatment of children. It would thus be those areas with a shortage of general dental practitioners which would be hardest hit if authorities cut back on their community dental service.
Since the publication of the White Paper Promoting Better Health the BDA has been alerted to more cases of health authorities appearing to want to disregard the statutory responsibility. There have been clear statements that their motive is to save money and that they accept that problems with patient care could arise. In some cases the planned cuts are massive, as the noble Lord, Lord Ennals said. They are in the region of 40 to 60 per cent., and at least three authorities would like to be able to abolish their community dental service completely.
If some health authorities are taking this form of action now, the removal of the statutory duty would send a clear signal to them and to others to proceed with cutbacks. The problem could then become worse and more widespread. Should this occur, there might not even be sufficient community dental service staff to maintain the new direction for services proposed in the White Paper.
I believe that the statutory duty should remain but be modified to permit the targeting of the community dental service desired by government. This could permit the restricting of screening to areas shown to have real dental needs. The Government would then have targeting, while health authorities would be inhibited from making inappropriate cuts. I think there is much agreement all round on the need to target the community dental service more effectively and to continue with school screening where necessary. The remaining difference over the need for a statutory power is relatively minor.
I am sure that it is essential to retain the statutory powers while enabling the Secretary of State to provide guidance to health authorities on how to target the service. I plan to bring forward an amendment on this point at the next stage, and I hope that my noble friend the Minister will be able to give me some encouragement to do so.
2.4 p.m.
Lord Kilmarnock: My Lords, it does not seem to me that this is the right Bill on which to raise a wide-ranging discussion on the future funding of the National Health Service. But it is valid to criticise the introduction of the new charges under the Bill at a time when a major government survey of the methods of funding the service is under way. There are many views and variants in the air which we shall, no doubt, discuss at length on future occasions. That is my first point.
Any radically new policy on charging, as this is, should have waited until the review had been widely and properly discussed. That is a criticism of the timing. But the charges for dental examination and sight tests are also objectionable in principle. I cannot for the life of me see on what principle we are able to have free examinations of any part of the body—throat, chest, rectum, elbow or knee—but not
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of eyes and teeth, as if these were some curious kind of optional extra not essential to the health of the whole. It defeats me how such discrimination can be logically or morally justified.
Furthermore, these charges appear to be at distinct variance with the Government's often-stated policy, which we all support, of stimulating preventative medicine and primary health care with the object of reducing the burden on hospital services by detecting conditions at an earlier stage and perhaps thus avoiding them altogether.
On the dental side I will say little. Those issues are in the capable hands of the noble Lord, Lord Colwyn, and also of the noble Baroness, Lady Gardner of Parkes, who is yet to speak. As both speak from the Government Benches (therefore, all good dentists appear to be Conservatives) I am sure the Government will pay a great deal of attention to what they have to say. But I cannot refrain from adding my voice—the third or fourth, I believe in this debate—to the general concern about the removal of the statutory requirement for dental inspection and treatment of schoolchildren. I regard that as an especially retrograde step.
The British Dental Association has suggested that if the Bill goes ahead up to 50 per cent. of schoolchildren in the United Kingdom may miss out on dental care. I had always thought as a layman that this service was largely responsible for the improvement in children's dental health and thus of dental health of the nation at large, to which the noble Lord, Lord Skelmersdale, referred with some pride, I thought. I cannot see that injunctions to hard-pressed health authorities, looking around desperately for savings, will fill the gap.
Even if the Government will not yield on examination charges for adults, I hope to hear from the Minister that they will think again, particularly in view of the concern expressed on all sides of your Lordships' House about this particular proposal.
I regard the proposed charges for sight tests as even more objectionable. Loss of teeth can be compensated; loss of sight cannot. Apart from the savings which the Government seek, the argument is really about the value of opportunistic screening. The profession
points to the fact that 70 per cent. of positive referrals in respect of glaucoma come from high street optometrists following a free National Health Service eye test. As at present most people over the age of 40 have their eyes tested for one reason or another, one would expect that that generalised sift was fairly efficient, as it appears to be. I would much prefer not to tamper with a system which is working well.
On the other hand, disregarding professional opinion, the Government argue that it is a wasteful and random form of detection and it should be scrapped in order to plough the money back into other branches of the primary care service. That has given rise to such widespread concern that the right honourable Tony Newton came forward with a number of concessions at Report stage in another place. The noble Lord, Lord Skelmersdale, has referred to them. He also mentioned new arrangements to provide help for those with incomes

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just above the qualifying level of incomes support and family credit. Can the Minister tell the House when the proposals will be introduced and on what scale? Can he also say whether that will be provided for by a regulation under the Bill during its passage through Parliament?
The right honourable Tony Newton and the Minister also spoke of discussions with the profession about a new process for the screening of glaucoma. He mentioned that modest additional funds will be available for that. From what he said I am unclear whether the new arrangements are likely to be in place or agreed before the Bill leaves Parliament. Those are two points that I should like to raise about the particular arrangements.
The most important issue appears to be the large questionmark over the amount of saving which will be achieved. As the honourable lady Dame Jill Knight pointed out in another place, where the Government have been paying approximately £10 to an optometrist to test a person's eyes, in many cases they will now be paying £35 to a London hospital. If a GP advises an eye test and the patient does not have the money to pay, he will refer that patient to the hospital. Even in a general hospital outside London the process could cost £25 or £30. As the noble Lord, Lord Hunter of Newington, has said, such things should be done outside the hospital service wherever possible.
I am extremely doubtful about the amount of net saving which will be achieved as the result of the Bill. Fewer dental and sight examinations will mean less early diagnosis and detection. Eye disease will add to the burden on hospitals and the whole exercise may turn out to be counterproductive, even in cost-cutting terms. That in turn will presumably affect the Government's whole strategy of redeploying the money elsewhere. That is an issue to which I shall return.
To introduce a new note into the discussion, I should like to point out that there is a much better way of saving money, of which the Bill makes no mention. I refer to more general generic prescribing of medicines. The Government have already demonstrated their concern about the size of the NHS drugs bill by introducing the limited list. I understand that it has now settled down and is delivering most of the saving expected of it, which is in the region of £75 million a year. That cannot reasonably be further pruned because there must be a range of choice available to doctors in the different therapeutic areas. Further substantial savings can be achieved by the extension of the prescribing of generic substances for branded products.
When the noble Lord, Lord Northfield, introduced a Bill early last year, which was the forerunner of the section repealing licences of right in the Copyright, Designs and Patents Bill, I introduced an amendment based on the Greenfield Report on effective prescribing. It would have made it obligatory on chemists to supply a non-proprietary medicinal product, if one existed and was properly approved, unless on the form the GP insisted on a proprietary brand by putting a simple tick in a box.
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I should like to emphasise that I was not opposing the abolition of licences of right for which the industry has made out a reasonable case. My amendment would have bitten only on products which had enjoyed their full 20 years' patent protection. I did not press that amendment, however, because it was not wholly appropriate to the Bill introduced by the noble Lord, Lord Northfield, which fell in any event.
That amendment, or something similar, is highly appropriate to this Bill, especially in view of the much less acceptable cost-cutting devices proposed by the Government. On those grounds I shall be proposing a new clause to the Bill at the Committee stage. It will have the object of promoting generic substitution with its attendant savings. I do not believe that it should be wholly unwelcome to the Government who are bound to be permanently cost-conscious in this field. If they will come forward with something of their own I dare say that many noble Lords will be happy to rally round that.
However, it is important that a major boost should be given to effective prescribing—which is Professor Greenfield's phrase—either through generic substitution by pharmacists or by some other means. I do not expect the noble Lord to give a detailed comment on that today but I hope for some sympathetic noises towards the idea in principle. The details can be discussed in Committee.
There are other parts of the Bill which we can support. Among them is the compulsory retirement age which opens the way to younger doctors. We have advocated that for a long time. With regard to Clause 7, I have no objection in broad principle to the Government's aim to raise additional revenue for the health service. However, I tend to agree with the National Association of Health Authorities that that will be rather marginal and should not be allowed to consume too much management time.
However, I have three specific concerns on which I should like some reassurance from the noble Lord: first, whether Clause 7(1)(d) would operate to allow a pharmacy with a NHS dispensing contract to be opened on hospital premises or, indeed, for the hospital itself to run one. If so, that would seem to go against the spirit of the recently renegotiated pharmacists' contract which I believe should be given time to get into its stride. At the very least it would seem that any such development should be subject to the normal process of application to the subcommittee of the FPC so that the Government's policy of a more even spread of pharmacies is not adversely affected. I should be grateful if the noble Lord could comment on that.
I should also like to support the point touched on by the noble Lord, Lord Winstanley, that Clause 7(1)(f) allows the Secretary of State:
"to develop and exploit ideas and exploit intellectual property".
There is concern about this, which is linked to unhappiness over the recent changes in the DHSS research contract. It is not clear from the wording of the Bill whether this subsection is intended to cover the results of research work commissioned by the department or surgical techniques developed within the hospital or what its scope is intended to be. I hope

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the noble Lord will help us to decide whether the alarm is justified.
On Clause 7(7) relating to accommodation and services for private patients, I should say that I am not opposed to private beds in NHS hospitals as they can generate valuable income, and I welcome the power of the Secretary of State to charge for them on the appropriate commercial basis. But if private beds are to continue to command general public support, it is vital that all criticism of sloppy and even dishonest collection of private charges is laid to rest once and for all. To that end the mechanism for collection must be foolproof. I know that the BMA has worked hard with the department to produce a code of conduct designed to end the administrative confusion over private patients. However, there is apparently a technical hitch in that the definition of "private patient" as written into the 1977 Act has been, inadvertently I am sure, removed from the Bill, which could create problems of collection for health authorities. I am sure that was not the Government's intention and therefore I hope they will bring forward an amendment in Committee to remedy the defect.
Clause 16 on the reimbursement of doctors' expenses is one of the most important clauses in the Bill and I believe it requires some clarification. The Government's commitment to continued development of relevant primary care teams in the White Paper is marvelous—vaccination, immunisation, screening, chiropody, physiotherapy, in-house social workers, a wide range of expertise, and reduced times in the waiting room. You name it the practice should provide it. Indeed, the noble Lord Lord Skelmersdale, almost waxed lyrical on this theme.
He referred to more money becoming available, but along with the noble Lord, Lord Winstanley, I am not clear how this will be reconciled with cash limits or whether it will be an increase in real terms, a concern also expressed by the noble Lord, Lord Ennals. The difficulty is that although doctors at present may claim 70 per cent. of the cost of a maximum of two full-time staff, the national average of staff employed per doctor is still only 1·2 full-time equivalents. While honouring existing arrangements, as I understand the Bill does, it removes the ceiling of two employees qualifying for reimbursement and puts the control of all future funding for ancillary staff and premises under the control of the FPC.
The ostensible idea is to encourage, in collaboration with the district health authority, locally agreed strategies for the more effective use of primary teams. That is a splendid idea in principle. Indeed it goes a long way or could go a long way to satisfying those of us who for years have advocated closer links between FPCs and DHAs, and their ultimate amalgamation. However, unless additional funds or new money is made available, it is hard to see how all these practice improvements can take place in needy areas such as the inner cities, other than—and this is the point—at the expense of any continuing improvement in the national average of ancillary staff.
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From the Financial Memorandum to the Bill my reading was that the Bill was intended to be cost neutral. The noble Lord, Lord Winstanley, said that it was intended to save money on public sector borrowing but I read it as intending to be cost neutral. That means that savings from the abolition of free tests will be ploughed back into the primary care team. However, what will happen if these savings do not materialise? Will the Government still add the savings they originally calculated from the abolition of free tests to the primary care budget? How is this going to work on the ground?
I believe it will be very helpful to all of us if the Minister can say a little more about this rather complex area when he comes to wind up. I take the point of the noble Lord, Lord Winstanley, that one should not go into too much detail on Second Reading but by asking these questions it may help to clear the ground about the attitude that we shall take at later stages of the Bill. No doubt the noble Lord will be able to satisfy us on many of the points that I have raised, in which case we shall not need to put down amendments in Committee.
2.20 p.m.
Lord Wallace of Coslany: My Lords, I agree entirely with other noble Lords who have mentioned the extension of charges to dental and eye examinations. We still have the right to general examination of the body by a medical practitioner, so why exclude teeth and eyes? Routine examination of the eyes can often yield evidence of disease and referral to a doctor for treatment. I have personal experience of this, not with myself but with a member of my family.
The main point I wish to make concerns income
generation, so briefly referred to by the Minister but which, frankly, was not referred to at length by anyone else. Naturally my noble friend Lord Ennals did his stuff, but it is a point that has to be examined more carefully. First, there is the effect of income generation on hospital management. At the moment management is already involved in schemes which have nothing to do with hospital management. It is far better that hospital managers concentrate upon the real job of hospital management and not waste valuable time on negotiating and promoting schemes which are quite outside the remit of their duties. Such schemes call for the business tycoon or someone of that kind.
Recently, in a Question to the Minister, I asked who would be responsible for carrying out schemes which in the main have no connection with the health service. They are simply money-raising ideas with a view to providing extra money for the service both locally and nationally. The Minister will recall that he replied that presumably someone would have to be appointed.
My experience so far is that the poor old managers, some of whom are doing the job quite happily because it is a relief from their other work, are involved in getting these schemes going and they are not adequately carrying out their hospital management duties. It seems therefore that the hospital managers are carrying out the job at the

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present time. As I said, that constitutes a further burden of work and the lessening of patient care.
I do not object to the National Health Service providing and selling such of its medical services as may be necessary to private hospitals, and so on. However, I object to the provision of services such as advertising, mini-supermarkets, flower stalls, catering services and many other facilities which are provided elsewhere. Car parking charges seem to be a natural for exploitation among managers. But what about the staff? There are volunteers assisting in many ways. Will they have to pay? In some cases charges are already being put forward to them.
Another important aspect is that of the out-patient. For example, an elderly out-patient may call upon a friendly neighbour for a lift to a hospital which is difficult to reach, as is so often the case because there cannot be a hospital in every area. Will ambulances be available to deal with that situation if car parking charges stop individuals offering lifts?
One needs only to look at Clause 7 to realise the extent to which the health service is being committed. Clause 7(1)(a) states that the Secretary of State shall have power:
"to acquire, produce, manufacture and supply goods".
That covers a tremendous amount of services. Clause 7(1)(b) states that the Secretary of State shall have power:
"to acquire land by agreement and manage and deal with land".
Are we going in for property development or something of that kind! Finally, Clause 7(1)(g) states that the Secretary of State shall have power:
"to do anything whatsoever which appears to him to be calculated to facilitate, or to be conducive or incidental to, the exercise of any power conferred by this subsection".
Those provisions give the Secretary of State a complete free hand to do what he likes. Those are just a few examples of the sweeping powers which are far more extensive, and need more careful checking, than appears to be the case at the moment.
I happen by chance to possess a copy of the National Health Service Management Board's letter which was sent out to hospital managers. It is dated 5th April 1988. I recommend the Minister to read this document. It is informative—far more so than the legislation because it is written in ordinary language—and it appeared before the Bill was available. Some of the letter is most interesting, written as it was by a former NHS manager. It states:
"The Management Board does not wish to see schemes developed that run counter to general health policies, that might be regarded as being in poor taste or that involve undue risk. Authorities will also need to take account of any existing activities by voluntary organisations and discuss any changes fully with them with a view to ensuring that their services are channelled into those areas where they can be of most benefit. In short, we expect health authorities to act sensitively over the way in which they undertake or introduce commercial activities".
I wish that Ministers had had recourse to that management letter before they drafted the Bill. The legislation before us makes no mention whatever of the quotation to which I have referred. I am president of a league of friends. Such organisations, and many others, do valuable service for their respective hospitals. The league to which I belong raises at least £30,000 to £32,000 or more per year, which goes
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directly to the local hospital. There is no argument about that. The hospital is guaranteed that income.
The point simply is that the National Health Service hospital is part of the community. That is something that no private hospital ever is or can be. That is perfectly true, as we know. It is because of that fact that hardly any appeal goes unanswered for a local hospital.
In the early days of the National Health Service leagues of friends were only expected to cater for the comfort of patients and staff. Today we are busy in many directions raising money for valuable equipment needed for the health service, and we are getting it. This work will go on unless the income generation scheme interferes with and upsets volunteers.
We need voluntary service. We have always needed it in the National Health Service. We need it to be extended, and yet no word whatever about it is placed in the legislation before us. I challenge the Government to introduce an amendment to the Bill on the lines of the management board letter, drawing attention to the valuable work of the voluntary organisations and the need to consult them before schemes are carried out. Of course that consideration applies to local schemes, but does not refer to the larger national ones. Unless that is done, I can see that in many cases there will be conflict and loss of voluntary action. In other words, the whole matter needs to be handled with great care.
Finally, should such schemes go ahead, I ask that someone else should be appointed in place of the manager. It has never been the job of a health service manager to deal with such matters. His job is hospital organisation and out-patient care; it is not that of a part-time industrialist. Further, what arrangements are to be made for accounting? Does all the money raised locally go to the hospital or to the local health district? Other monies raised go to the Ministry, or does the Treasury have something to say on the matter? In any event separate accounts must be kept in the best traditional business manner. Such administration will prove expensive and will require additional staff. There may be a case for medical and nursing sales but the rest is just a waste of time, as much of the work is already being carried out by voluntary effort. It will only clog up an already exhausted machine with too much management at all levels. Why not clear up existing management and leave the extra bits and pieces where they properly belong?
I frankly admit that there is room for improvement in the National Health Service, without going into the side efforts just to raise money, which is the case with Clause 7 and much else. That is not brought about by legislation.
2.33 p.m.
Baroness Gardner of Parkes: My Lords, as a practising national health dentist, who has been in practice for a long time, you would of course expect me to speak upon dental matters. However, before doing so, I wish to make a few points on behalf of the general practitioners and, interestingly, a slightly reverse point on behalf of the Royal College of Nursing.

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The general medical practitioners are most concerned about the cost of premises and ancillary staff, especially in the big cities and the inner-city areas where the costs are high. There is genuine concern about the future of such services—which are now provided so well by practices—which have adequate ancillary staff and which have taken over great responsibility from the local hospitals, because patients are now able to receive treatment in the general practice.
The Royal College of Nursing has also written to me putting forward another point. Their concern is that the general practitioners will receive all the money and they may not receive anything for the services being run by the nurses in the community services. Therefore both points are highly relevant and both directly related to the cash limits. I found it difficult to reconcile the most interesting speech of my noble friend the Minister, when he told us how much more money will be spent on primary care services, with what I read in the Bill; namely, that the financial and manpower effects show that Clauses 1 to 6 and 8 to 16 are:
"expected to produce significant net savings on public expenditure".
I should like the Minister to reconcile for me how we can be spending so much more and yet, at the same time, be saving so much on public expenditure. It is somewhat difficult to follow.
I should also mention that dentists have always longed for some form of direct reimbursement, such as doctors receive. Dentists in the expensive and inner-city areas are experiencing great difficulty in even surviving in some cases—certainly if they provide a large proportion of National Health Service dentistry. Anyone running a practice with, say, 85
per cent. national health dentistry is in grave trouble. That is why patients, especially in London, Birmingham and the big cities, are finding it harder and harder to obtain national health treatment, because the amount paid by the National Health Service does not match the costs involved. I know from experience in my own practice that for the time taken, our costs amount to something like twice the cost of the examination fee presently paid. Therefore with every patient one examines—even when that patient does not have to pay—one is still really giving him a present for walking in one's door. One tends to survive only on the actual treatment provided.
Dentists are victims of their own success. As the Minister points out, 8 million patients now require examination only. That is due to the fact that over the years the effective dental treatment given to patients has so improved dental health in this country that the dentists are the very ones now suffering.
The story with regard to younger patients is different; it is a case of fluoride, prevention and dental health education. We talk about the community service but the day may come when general dentists desperately need to examine schoolchildren—who will not have to pay—as a source of income. The rest will always have to stop and think twice about what it is going to cost them.
The deterrent effect of a charge for dental examination cannot be overestimated. Over 30 years
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in practice, I cannot claim to have found more than six life-saving conditions that were visible when patients came to the surgery; but I would certainly say that there have been six such cases. I remember very clearly one man who had shown great courage; he was terrified of visiting the surgery. His income was very low income and if there had been a charge, I do not think he would have come for perhaps another six months. That would have been too late. He had an obviously nasty lesion which we picked up. We referred him for treatment.
That man, who had two children, is still alive over 20 years later. The children have grown up and their lives have been changed completely. His case seems to me a highly relevant argument for having free dental examinations. It might have cost the Government much more to support the widow and those children over the 25 years that the man has continued to be able to support them. That could have been quite expensive.
Our practice has picked up six similar conditions in 30 years. One can multiply that for every practice in the country. One sees that there are patients whose lives have been affected by a decision whether or not to put off going to the dentist. That argument, I believe, outweighs anything else.
The other aspect of whether or not people can afford treatment is different. A great number of people could afford to pay and indeed could pay more than the Government presently pay. I do not think it is entirely a financial matter. Those at the very bottom end of the market, who need assistance, receive assistance and can have free treatment. Therefore I am not so concerned about those people. I am really concerned about the patient who is terrified of going to the dentist. Even the slightest additional deterrent will be enough to stop a visit.
Mention has been made of the possibility that the Government do not intend immediately to implement charging but that they want to have the powers in advance. If that is true, I oppose it. Let them come for the powers when they want them rather than at any other time. There is nothing more insidious than obtaining powers in advance of need. It is rather like the case of the M.4 motorway into the middle of London. Nobody thought about it because it had all been approved 15 years previously. But the day cars were roaring past their windows, they suddenly noticed. I do not on any account want us to agree to it if it is not going to be implemented, any more than if it is to be implemented.
The Minister mentioned that one can now obtain glasses for £10 to £12. I wish he would give me an address or two. I find that the cost of reading glasses has more than doubled. I am hanging out for as long as I can. I shall have to make my writing larger to put off going for another pair. I think there are many people like myself who are deterred from having new glasses until they really cannot do without. I have spoken about the desirability of dentistry from the life-saving and from the dental health points of view. However, in considering the health aspect I am more concerned about eye tests than I am about dentistry. If a person loses a tooth, the dentist can give a form of replacement; but it is different if something disastrous happens to one's eyes. I am no expert, but

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I should be terrified by losing my sight. That aspect has all my sympathy.
My noble colleague has spoken about the educational role of the community dental service. I agree with the point about its importance. As I said, his point about targeting services is a good one. We must see what will happen about that.
Retirement is another issue that comes up in the Bill. Clause 8 seems to cover retiring age. I fully approve of a top age for retirement, especially in London. There are too many medical practitioners working single handedly in inadequate practices who are unwilling to take on patients especially if the medical practitioner has an expensive address. It means that people are being deprived of national health medical treatment in large areas of our city.
It would be good if the Government would consider early retirement facilities. I ask the Minister whether that point is covered by the Bill. We have too many dentists now. We are reducing recruitment; we are not training so many dentists. However, we still have too many. There is not enough work for them to do. As I have said, they are victims of their own success. Instead of trying to share out whatever work there is among them, would it not be better—even if it meant paying up their superannuation—to allow some to retire early to make room for some of the others?
I approve of a ceiling on the retiring age but I should also like to see options for voluntary earlier retirement. Many people who retire early find that retirement opens up a new life for them. There is certainly plenty to do in life now.
The Minister said—and it is a fact—that different dental charges have already come into force. The profession has always believed that the regular patient was prejudiced and so proportional charging is a good thing. That is the point that the Minister made.
The profession is less happy about the fact that dentists are unpaid tax collectors. This has gone on for many years now. They all handle money and do calculations. I think that I made the point some years ago—it is still relevant—that we are back to handling coppers again. We now have to take in a handful of small change. Instead of dental charges being rounded to the nearest 5p, one now has to give a few pence change. That is a terrible waste of professional people's time. It is difficult to find professional or ancillary staff to help in a practice in central London. It is not good to add those unnecessary and irritating burdens.
The Minister said that we want dental awareness and regular attendance. There has been a great growth in dental awareness. Years ago people would come in, and the only statement they made was, "It might as well come out now, because it has to come out sooner or later". No one in London says that now, although I believe that it is still said a little in the North. People now want to have their teeth until the day they die. It is on that point that the comment about Age Concern, made by the noble Lord, Lord Ennals, is more relevant than it was.
A year or two ago, I should have said that examinations for elderly people were less important
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because so many had dentures; but they are now becoming more important. I believe that the Government have retained free domiciliary visits for the elderly. It is important that they should have such visits. A call-out charge for a dentist to see a patient at home could be expensive. It is one of the better paid elements of the health service, perhaps because it is so difficult to get the dentist to visit.
It is a very good thing to have improvements in the primary care services, but I find it impossible to reconcile the statements in the speech of the Minister with the facts as they are in the Bill. I think that this is a worry for people. I hope that as this Bill progresses we shall be able to look at things again.
Everyone says that dental examination is free now. That is true, but only on a time-limited basis. You can only go for a free dental examination once in six months, and for children it is once in four months. There might be some possible compromise point at which you could have a free dental examination once in a year, or something of that type, and for most adult patients something of that kind might be an answer. But if instead all free dental examination is thrown out, then I believe that the patient most in need of it may be the very one who will not attend.
2.45 p.m.
Lord Rea: My Lords, it is very interesting how much agreement there is between the working professionals in health on both sides of the Chamber on quite a number of issues which we discuss in your Lordships' House. I must apologise to the noble Lord the Minister for arriving rather late; it was for the same reason as was given by the noble Lord, Lord Colwyn. I may have missed some of the points he made and if that becomes clear from my speech, I apologise in advance.
This is a short but quite complex Bill, but very little of it deals with the positive aspects of the White Paper Promoting Better Health. It has 20 clauses and I calculate that these cover some 14 separate topics, only three or four of which are, I feel, moves in the right direction. These include Clauses 8 and 9, dealing with the retirement of GPs to make room for younger doctors. There may be some parts of Clause 10 dealing with community dentistry which are beneficial towards dental education in children, but I am not sure of the full implications of the whole of that clause.
Clauses 15 and 19 relate to training—reimbursement of GPs' expenses in training staff and students, and increased government support for social work training. Both of these are steps in the right direction towards improving services and, of course, I fully support those. I take on board the remarks of the noble Baroness, Lady Gardner of Parkes, on the concern of nurses at not being mentioned in Clause 15 about the reimbursement of training costs.
There are five areas which seem to be relatively neutral in their impact. They are probably necessary but not exactly earth shaking and some of them, I admit, I do not fully understand. I do not think I would have understood some of them even after the noble Lord's explanation, because some of the clauses are a little obscure.

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That leaves six measures which in my view will be damaging in their effect. They are Clauses 1 to 6 dealing with the privatisation of the General Practice Finance Corporation; Clause 7 dealing with income generation by health authorities—and I agree with the noble Lord, Lord Wallace, in his reservations about that clause; Clause 10 in the part that diminishes the scope of community dentistry; Clause 11 where it ends free dental inspections; Clause 13, which has been mentioned by many noble Lords, dealing with the ending of free eye tests, and Clause 16 dealing with cash-limiting family practitioner committees.
I shall concentrate on eye tests and cash limits, but may I first put in a word about the General Practice Finance Corporation? This was set up in 1966, mainly to enable GPs in unattractive or underprivileged areas to improve their premises. It is a self-financing organisation charging interest at the prevailing rate. For this reason it is only technically a charge on the public sector borrowing requirement.
Some aspects of the privatisation proposals cause concern. First, if doctors have applied to use the General Practice Finance Corporation's facility for acquisition and subsequent lease-back of their premises, is there any assurance that the successor body will honour this? This is rather a complex subject on which to speak in the House and perhaps the Minister will read what I have said and write to me later.
Secondly, have the Government yet decided how the General Practice Finance Corporation's assets and liabilities are to be transferred to the private sector? Lastly, if the corporation's portfolio of leases and loans on the premises of GPs are sold, what protection would be offered to existing mortgagees and tenants, since the loans are categorised as commercial and not as domestic?
My main concern with the ending of free eye tests is that, as many other noble Lords have mentioned, a valuable screening service will have been made less effective. I consider that the Bill will promote worse and not better health in regard to eyes and also to general medical conditions, as I hope to point out. There are a number of medical and ophthalmological conditions which cause eyesight to deteriorate. Two of the commonest are diabetes and glaucoma. It is important to recognise both at an early stage in order to prevent complications, to avoid the condition itself and to prevent blindness. Opticians themselves may not be trained to diagnose eye pathology in detail, but as the noble Lord, Lord Hunter, said, they can detect that something is wrong if vision cannot be corrected with the use of suitable glasses. Many will have a very good idea of eye diagnosis because they will have been trained in optometry—that is testing the pressure in the eyeball which is necessary to detect glaucoma—and funduscopy, which means inspecting the back of the eye, which is necessary to detect diabetic retinopathy. If they are in any doubt they will refer to a ophthalmologist, usually through a general practitioner.
If the optical complications of diabetes are detected early enough, blindness can be prevented in
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60 per cent. of the cases by laser treatment. But only about half of known diabetics actually attend out-patients' clinics, where they are screened regularly for early eye disease. GPs, who see the other half, are often not so good at funduscopy. I admit to not being expert, and many opticians and optometrists have more practice and are better at it. Therefore it is a great relief that the Government agreed at Report stage in another place to insert Clause 13(4)(b), permitting those with certain diseases still to be entitled to free eye tests.
As Dr. John Yudkin, a consultant physician and diabetologist at Whittington Hospital, pointed out in a letter to the British Medical Journal in January, if 1,000 diabetics are screened 12 cases of early retinopathy will be detected and seven of these can be prevented by laser treatment from going blind. He shows quite clearly that the exercise is cost-effective, let alone the immeasurable benefit of saving sight.
However, of more concern to me is the fact that many previously unknown diabetics are picked up by opticians. Their high blood sugar results in refractory changes in the fluids in the eye and the lens, which result in a deterioration of vision. This leads people to seek an eye test, from which I feel they may be deterred if there is a charge. Also 8 per cent. of diabetics already have retinopathy, the condition which leads to blindness if not treated early, when they are first diagnosed. The ending of free eye tests will have an adverse effect on the initial diagnosis of diabetes and glaucoma, which may lead to blindness if untreated.
Clause 16, which brings family practitioner committees into the cash limited sector of the NHS, seems, as other speakers have pointed out, a curious non sequitur, given the stated intention of the Government to expand the role of primary care. The Government justify that on the gound of the need to control total expenditure while encouraging certain aspects of the service to develop. One aspect of expenditure which the White Paper encouraged was the employment of more ancillary staff by GPs—that is, clerical, nursing and management staff—70 per cent. of whose salaries are reimbursed by the FPCs.
At present, a limit is set of two staff per GP. However, the national average of staff employed at the moment is only 1·2 per GP. That ranges from 0·72 in Oldham to 1·59 in Cornwall. Some more ambitious and enterprising practices, wishing to increase their services, may go quickly to two staff and above. However, if there are cash limits, will those practices which apply later find their applications blocked because the cash limit will have been reached? The main task is surely to encourage the less forward-looking general practices in the country to expand their services. How can that proposal help them?
We are in the dark about how cash limits will be administered. For instance, how will family practitioner committees decide which practices get funded and which do not? Will maximum standards for premises be set if numbers of reimbursed staff are allowed to expand? What about the salaries of reimbursed staff, some of whom are skilled professional people? At present, ancillary staff are very poorly paid—well under the national average. Will cash limits tend to stop them being paid

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adequately? Will the 70 per cent. level of reimbursement remain or is there a thought that it might be reduced? Those are some of the worries which many of us in primary care have. It is reasonable to seek some clarification. I hope that the Minister will be able to oblige.
In the section of the Bill which relates to financial and manpower effects, which has been mentioned by the noble Lord, Lord Winstanley, and others, it is made clear that the changes proposed will not only involve no additional public expenditure but will result in net savings. The White Paper is entitled Promoting Better Health. Do the Government feel that that can be done as part of an economy drive? I am afraid that the only kind of health that the Bill will promote will be healthy scepticism.
2.59 p.m.
The Countess of Mar: My Lords, the National Health Service has been very much before us recently. Noble Lords will know that I have not been reticent in keeping it so. I have had very good reasons, for I do not believe that the health of any individual should be sacrificed to Mammon. I believe that both the healthy wealthy taxpayer and the sick should receive value for money and that all the resources, be they men and women, medical and scientific equipment or buildings and land, should be carefully husbanded.
The Bill conceals a number of carrots and sticks among some fairly innocuous clauses. Those which cause most concern, such as provisions relating to dentistry and the optical services, have already been thoroughly aired by previous speakers. Therefore, I do not propose to dwell on them for very long.
The General Practitioners Finance Corporation was an obvious target for privatisation or dissolution as the process is described in the Bill. My only reservations about Clauses 1 to 6 are that the financial stability given by the GPFC to general practitioners for building or extending surgeries and health centres should continue and that current loans to GPs should not be altered. Agreements should be honoured under the original contracts. Is the Minister able to give such an assurance?
I think that we would all agree that the Secretary of State must have the power to ensure that the assets of the National Health Service are fully exploited. That is part of good management. However, the peripheral activities must not be allowed to detract from the main objectives of management—service to patients. Once again fears are being voiced over the Secretary of State's powers regarding intellectual property. I think that the noble Lord, Lord Hunter mentioned that point. Clause 7(1)(f) will have to be very carefully scrutinised.
There has been a long debate both within the medical profession and outside it about a compulsory retirement age. Is the Minister able to say whether there will be any flexibility? I am thinking particularly about some practices in inner cities and rural areas where a doctor has been practising single-handed and where the family practitioner committee may have some difficulty in finding a replacement.
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The arguments for and against charging for initial optical and dental treatment have already been thoroughly rehearsed. The effects that the charges levied will have on the take-up of these services are an unknown quantity. I know that the Government have promised to exempt certain groups of people who are regarded as vulnerable but the preventive aspects should be paramount—a stitch in time. I am sorry to see that the Government do not consider the school dental service sufficiently important to warrant the imposition of a duty upon the Secretary of State to continue its provision. Not all parents ensure regular visits to a dentist for their children.
I am delighted to see that Her Majesty's Government recognise the need for ancillary staff to be trained and are prepared to reimburse training costs, although to what extent is not clear from the Bill. The Dispensing Doctors Association—of which I am patron—has long been exploring the means to ensure that their dispensary staff are qualified. I am hoping that the provisions under Clause 15 will give them the means to attain their objective; or will they be only for practice nurses? I wonder whether the noble Lord will be able to answer that question. Can he also say whether the Government will be prepared to reimburse all or only a part of reasonable training expenses?
That was the carrot: now for the stick. Clause 16 enables the Secretary of State to impose cash limits on general medical services. We have already seen the effects of cash limiting on the acute services. In very many instances the savings achieved by district health authorities have been achieved only at the expense of family practitioner committees. Longer waiting lists, early hospital discharge after surgery, discharges from psychiatric hospitals, closures of family planning clinics and a reduction in drugs dispensed by hospital pharmacies have all imposed a considerable burden upon the family practioner committees. There is no question of general practioners having carte blanche at present. Their expenses claims and prescribing habits are closely scrutinised by the FPCs.
The Government have outlined their objectives for expansion of preventive medicine and for community care in various papers recently. Constraints on funding of FPCs will undoubtedly lead to restrictions on the rate at which those objectives are achieved. The general practitioner is the first and often the last post for the patient and provides a backstop for the acute services. It is essential that patients should have free access to their GPs and that GPs should be free to provide the treatment considered reasonable and necessary.
There is no evidence to show that GPs are extravagant in their demands to FPCs for reimbursement for improvements to premises or employment of ancillary staff. The existing incentives to economy are successful. It could even be argued that fewer and not more restraints should be imposed to encourage GPs, particularly those who practise in the inner cities where property is disproportionately costly and the current reimbursement schemes have failed to bring about necessary improvements.
At what levels will those limits be imposed? If they are to approximate to current spending levels it is

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likely that some GPs and patients will receive more favourable treatment than others. If they are to be higher, what would be achieved? I believe that the current constraints on extravagance work well and that we should vigorously oppose Clause 16.
I am very grateful to the Minister for so clearly putting the Government's point of view, and I hope that he will be his usual co-operative self when we go through later stages of the Bill.
3.5 p.m.
Lord Cullen of Ashbourne: My Lords, I propose to concentrate my remarks on Clauses 13 and 14 of the Bill which are concerned with the subject of optics. I declare my interest as president of FODO (the Federation of Ophthalmic and Dispensing Opticians).
The main thrust of the Bill and the White Paper Promoting Better Health has in general been warmly welcomed. The dental and optical clauses are quite inconsistent with it. I have noticed that so far there has not been a single speaker in support of the Government's plans contained in the dental and optical clauses. I thought that one of the most interesting speeches today came from the noble Lord, Lord Hunter, and I look forward very much to reading it later.
It seems that during the public expenditure review the Treasury told Health Ministers that they could only obtain increased resources for promoting health care if corresponding savings were made elsewhere in the department's budget. I believe that it would be morally and economically wrong in principle for dental and eye care to be sacrificed in that way. I question whether the savings to be made will be spent more effectively elsewhere, if indeed savings are actually made, as the noble Lord, Lord Kilmarnock, disputed.
Neither of the proposals on dental or optical care were mentioned in the Government's election manifesto, so I hope that it will not be suggested that your Lordships cannot look at them and if necessary revise them. I do not intend to weary the House over the many signs of physical ailments that can be detected during the course of an eye examination. Many of them develop very gradually and are often discovered in their early stages only when a person goes to see an optician for a check-up. Much concern has been expressed by the BMA, the RNIB, Age Concern, Help the Aged and many other organisations to the effect that the withdrawal of a free sight test from about two-thirds of the population will deter a significant number of people from having eye examinations.
For some reason Ministers do not accept that there will be any long-term deterrent effect. Even if they are right about that, there will obviously be a short-term effect. Since the publication of the White Paper the volume of sight tests has risen by 25 to 30 per cent. Clearly, a corresponding fall will follow when people have to pay.
I understand that about 1 million people annually are referred by opticians to GPs when signs of glaucoma, hypertension and diabetes, etc., have been
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spotted. We have been told that under the provisions of this Bill about two-thirds of the population will no longer receive free sight tests. I doubt whether my noble friend Lord Skelmersdale will think that none of those 667,000 people will be deterred by having to pay the optician's charges for a sight test.
The Government's answer came in another place on 16th February in Committee when my honourable friend Mrs. Edwina Currie said:
"Doctors normally see about three-quarters of the patients on their list within a 12 month period. On average, people visit their doctors four times a year and the frequency rises for elderly people. However, people usually have sight tests every two or three years, or even less frequently. It follows, therefore, that if we are looking to deter conditions which may be detected through the eye or in other ways, the GP is the appropriate person from whom one should seek advice and assistance".
It is even more illuminating that on 16th February my right honourable friend the Minister for Health said:
"We believe that in general the increasing resources that we are making available to primary care services would be better employed on developing systematic screening arrangements—basically through GPs—than on the random issue of whether people happen to go for eye sight tests".
He went on to say that he did not agree that,
"what we are proposing in respect of the development of, among other things, screening activities for general medical services is something that is vague or distant".
Then, believe it or not, my Lords, he continued:
"Admittedly I cannot give as much detail as I would like because that depends, for example on detailed negotiations with the BMA which are now under way. Therefore, it is not possible for me to give details of where we shall end up".
I have the greatest respect for the Minister for Health but I wonder where some of the patients will end up.
I wish to ask the Minister two questions. First, does he visualise a doctor, visited by a patient with a sprained ankle, or a cut, in his very busy surgery, thinking that this is a heaven-sent opportunity to carry out a thorough examination of his patient's eyes? Secondly, would it not be wiser to defer the restriction of free eye tests at least until negotiations with the BMA have been satisfactorily completed? It will be no surprise to me if the BMA turn down the idea flat. Before Easter I met the chairman of the General Medical Services Committee of the BMA, Dr. Michael Wilson, who assured me that far from any such negotiations being under way they had not even started. Last week I enquired again. No discussions, let alone negotiations, had begun. Perhaps my noble friend will be able to tell the House whether these negotiations have now commenced and, if so, how far they have progressed and what they are intended to achieve.
I understand that there are about 30,000 GPs. Are they all to be given specialist training in ophthalmology and are they all to be supplied with the equipment used by OMPs and OOs? I am told that the minimum cost of such equipment to carry out eye examinations would be about £4,000. Apart, therefore, from the cost of training GPs and the provision of adequate space for this additional activity in the GP's premises, the cost of the equipment would be £120 million. So much for the £80 million savings anticipated by Ministers and the Treasury.

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None of this makes sense to me. And what happens if GPs make it quite clear that they do not wish to undertake these additional responsibilities which are currently being very well carried out by OMPs and OOs? Even if they are willing, I cannot think how they will find the time.
I very much welcome the ministerial review which I understand is taking place but I do not know why dentistry and optics have to be dealt with in isolation and why we could not have waited until that ministerial review was completed. Once having pushed through dental charges, and removed the general entitlement to a free sight test, I suppose it could be argued that it would be logical to make other charges for visits to GPs, hospital accommodation and meals, and so on. If that is what is in the Government's mind, why not say so? The Government have a majority of over 100 in another place and they have grasped many nettles since 1979. Why will they not say what their intentions really are? So far the Government have not enlightened us about the ministerial review of the NHS. What a good opportunity this is for my noble friend to do so.
As already mentioned, some concessions have been announced that promise retention of a free sight test for diabetics and glaucoma sufferers referred by a GP or a clinic. However, this is really too little, too late; it does not address the problem of how to encourage people who may be suffering from a symptomless condition to have the regular eye examination which might detect it in the first place.
The RNIB has welcomed the concession for diagnosed diabetics which is intended to ensure that price will not deter them from visiting the optician until it is too late. It points out, however, that this is a tacit acknowledgement by the Government that some people will be deterred by the charge from having a sight test.
On the subject of glaucoma, the RNIB urged the Government to go further. Glaucoma is known to run in families. It is therefore important that people over 35 who are related to a glaucoma sufferer should have regular eye checks. It urges the Government to allow free sight tests to first degree relatives of glaucoma sufferers on referral from a GP. I should like strongly to support this suggestion. I hope that my noble friend will give it sympathetic consideration.
It is well known that early detection of these conditions is vitally important—and no more so than in the case of the elderly. Surely if any group is in need of special consideration in regard to teeth and eyes, it must be the elderly. FODO has estimated that 6·5 million of the approximately 9 million pensioners will cease to be eligible for free sight tests if this Bill becomes law. We all know that elderly people are reluctant to ask for help and tend to regard deteriorating eyesight as an inevitable part of the ageing process. It is therefore particularly important that we should give them every encouragement to have regular eye examinations, since they are the group with by far the greatest need.
I really do not feel that it is necessarily an answer to say that there is no precedent for doing this. After all, the precedent is that the elderly have in fact been
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entitled to a free NHS sight test ever since 1948 and are still so entitled as of today. The Government are proposing to take away an existing entitlement and the onus of proof is upon the Government to justify it. I therefore ask my noble friend the Minister to give sympathetic consideration to the possibility of including pensioners within the NHS eligible groups entitled to free dental and eye examinations.
Whatever changes come out of this Bill, it seems to me obvious that if we are to have competition for sight testing services, then opticians must be completely free to advertise the whole range of the comprehensive services which they have to offer. I should like to see the existing publicty rules of the General Optical Council made in 1985 revoked entirely and replaced by provisions giving opticians a positive legal right to advertise all their services. I see no reason why there should be any restriction on the giving of information to the public, provided that it is not misleading and is subject to the existing law and the code of the Advertising Standards Authority.
In conclusion, I do not agree with the Government that the withdrawal of the free sight test will have no long-term deterrent effect. I believe that the short-term deterrent effect will result in many people suffering from disease—even blindness—which would have been detected if free sight tests were available to all. I ask the Government seriously to consider withdrawing Clauses 13 and 14, at least until they have agreed with the BMA how to implement their plans to have eye examinations carried out by GPs.
3.19 p.m.
Lord Graham of Edmonton: My Lords, it is with considerable pleasure that I immediately follow the speech given by the noble Lord, Lord Cullen, who was very reasonable and very controlled. Yet I detected that there was a great deal of, if not anger, considerable unease about the impact of the Bill.
Although many of those who have spoken have congratulated the Minister and his colleagues on aspects of the Bill which they recognise will to some extent improve the primary care services, I would simply underline what has recently been said: that there is not a friend in the House who supports what the Bill and the Minister and his colleagues intend to do by the institution of charges for eye tests and dental expenses.
Lord Rugby: My Lords, I disagree; I am afraid that I am a friend to it. Therefore the noble Lord is speaking for me before I have spoken.
Lord Graham of Edmonton: My Lords, I am obviously speaking about what has been said up to now, and the situation is that the Minister does not have a friend. However, I have flushed one out before the noble Lord has risen to his feet. To that extent the House can anticipate some support for the issue. No doubt the Minister will tell us of the imperatives which have driven him and his colleagues to this particular aspect of good housekeeping or reorientation of priorities.
I am interested in and grateful for the support for my general point of view which I heard from the

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noble Baroness, Lady Gardner of Parkes. On many issues and on many occasions she and I have had different points of view. However, on this issue and others she speaks with an authority and professionalism which I do not pretend to have. One of the facets of this debate has been the fact that some noble Lords have spoken not from general experience or with a gut reaction but from seeing the situation as it is. The noble Baroness was a good illustration of that, as were the noble Lords, Lord Winstanley and Lord Rea. They and many other noble Lords practise in the field and they will see the impact of the Government's actions.
I have a common interest with Dr. Ian Twinn, Mr. Tim Eggar, Mr. Michael Portillo, Mr. Bernie Grant, Sir Hugh Rossi, all Members of another place, and the noble Lord, Lord McIntosh of Haringey. We all received a letter from the family practitioner committee of the Enfield and Haringey area. Mr. Boris Whycer wrote to us indicating that at its recent meeting members of the committee received copies of Promoting Better Health, the Government's programme for improving primary health care. The depth of feeling of members at the meeting resulted in the following resolution being passed unanimously:
"On the grounds of basic preventative health care, this FPC condemns the proposed introduction of charges for sight testing and dental examination contained in the Government White Paper, Promoting Better Health".
No doubt all the people I listed found their own way of bringing to the attention of the Minister that which they were invited so to do. I ask the Minister to take on board the fact that the committee is responsible for the small part of London in which I live, and at that level it is the unanimous view. The Minister will know that there is no political animosity in the make-up of the committee. Serving on it will be politicians and those with strong political views and no views at all.
The issue has been raised of what is stated in the financial memorandum and what has been stated by the Minister. The noble Baroness, Lady Gardner of Parkes, said that there are people who will delay visiting the dentist, doctor or optician if there is a possibility of an additional deterrent, apart from their reluctance to do so. A charge which has not been levelled before is an additional deterrent.
It is not my intention to introduce or regurgitate the statistics that have been used but they are a very powerful argument. One sees the consequences of the diseases which are discovered at the first stage of an examination, and I wonder whether the Minister and his colleagues appreciate what they are doing.
I fully understand the Government's search for savings and their desire for efficiency and value for money. However, it is demonstrated by practitioners in the field and not someone who has conducted a survey, not someone who is in the Ministry, not someone who has written a paper, but people who tell it as it is, that in time any savings will be lost by the extra costs on the taxpayer. I wonder whether the Minister can help us; if not today, then in Committee. In Committee amendments will be moved that will be designed to be helpful to the Minister and his colleagues without damaging the full purport of the
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Bill. I cannot believe that the full purport of the Bill is to damage the coverage of primary health care in respect of eyes and teeth. I cannot believe that that is the purpose of it. I hope that we can convince the Minister to amend the Bill before we go too far down a particular road. The noble Lord, Lord Cullen, has pointed out a useful amendment. Other amendments will be moved along those lines.
Several bodies have written to me. I must confess that I rely almost entirely not just on a gut reaction, which is that I am in favour of a free service as far as possible, but also on those who write to me with their views. The Federation of Ophthalmic and Dispensing Opticians has written to me. It represents not only the Federation of Optical Corporate Bodies, which it has replaced, but it incorporates the British Guild of Dispensing Opticians and also the Co-operative Optical Services. I must declare a slight interest. The House knows of my deep and long association with the co-operative movement. Co-operative societies with their own optical departments are saying to the Minister that they recognise that there are good provisions in this Bill. I have made inquiries which confirm that there are good measures in the Bill, but there are also damaging and detrimental measures. I appreciate that the Minister may not be able to answer all the quesions, but I hope that he will listen carefully to many of the ways suggested to safeguard the primary health care of a great many people and, in particular, our children. I cannot get the drift of the Minister's intention to lift the duty to provide this care.
The Minister must know, because of his experience in other places, that on the margin there will be local authorities and health authorities which would say that in a perfect world they would wish to provide a good and satisfactory service to cover all eventualities. However, they will say, "Lord Graham, there is a limit on the budget. There is pressure from this quarter or that quarter and we have to make priorities". They will genuinely wring their hands. They do not want to do that, but in many instances they will be forced to do so, and we too shall hold up our hands. They will do those things because the Minister is saying that they now have the ability to do that. I hope the Minister will listen. In my view, the Government have a reputation for not listening to those who disagree with their views. The views heard from behind the Minister today are those which support him and his Government. I hope he will respond.
3.28 p.m.
Lord Auckland: My Lords, whatever defects this Bill may have, at least it has one thing in its favour: it is mercifully brief. According to my reckoning, it has only 21 clauses and two schedules, unlike some other major and controversial Bills in this Session. With the advance of modern technology, the DHSS and an ever-expanding National Health Service are almost in a "no-win" situation. To that extent, I have a great deal of sympathy for the Minister and his department, because obviously the most controversial part of this Bill concerns the optical and dental charges. Having thought this out very carefully, I do not necessarily criticise these charges per se for certain people.

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I take a view which perhaps even Mr. Enoch Powell may have taken in his distinguished days as a Member of the other place. If one has to have these charges they have to be realistic. Under the terms of the Bill and the charges which have been bandied around—I do not believe that anyone is certain what they will be—the Government have the worst of all worlds. Rather like prescription charges, the charges themselves are such that the revenue to the National Health Service will be very small. By the time the administration is operating it would appear to a layman such as myself that the revenue will be smaller still. Those of us who have an interest in the health service, whether serving on hospital committees, as members of a League of Friends, or anywhere else—and there are many noble Lords in that position at present—genuinely want legislation to work.
I agree with noble Lords who said that the cart before the horse is the problem. So far as I can ascertain there was not proper discussion with the British Medical Association and other bodies before these measures were taken. We are now in times when, under all governments, legislation is brought in without proper discussion with those who have to apply it. I believe this to be true of the Local Government Finance Bill, and we have all had enough of that for the time being—
Lord Graham of Edmonton: There is more to come.
Lord Auckland: We have had the Education Reform Bill as well. We are living in times when there is insufficient consultation with those who have the duty to implement the legislation. Ministers and civil servants have a very important part to play but ultimately it is the doctors, dentists, health committees and others who have the job of putting all these provisions into practice.
Perhaps I may say a little about Clause 7, to which the noble Lord, Lord Wallace of Coslany, referred. It contains some very sweeping powers. I should like to ask the Minister a question though I have not given him notice of it. Perhaps he will write to me and other noble Lords as regards Clause 7(1)(b) which states:
"to acquire land by agreement and manage and deal with land".
I was surprised to see that in a Bill of this kind. I live in an area where there are seven large dental hospitals and there is a great deal of land available. There is local concern as to what will happen to this land. Perhaps the Minister can say precisely what paragraph (b) means. We know that when the Department of Health and Social Security requires new nurses' homes and other establishments for people who administer the health service it is in a position to acquire land, perhaps through compulsory purchase.
It seems that while Clause 7 might be wholly in order, it is drafted in such a way that the ordinary person looking at it will see that it has draconian powers. I refer also to subsection (1)(a);
"to acquire, produce, manufacture and supply goods".
These are enormous powers and they have not been spelt out in the Bill. If they had been, it might have been much longer.
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I believe too that the suggestion that nurses, and in particular senior nurses, should be able to prescribe certain drugs and other medical appliances is a very good one. I think so particularly in view of the recent upgrading of student nurses, who will now be much more professional in their nursing than before.
This will take the strain off a number of general practitioners who, as the letter from the Royal College of Nursing suggests, often see their patients much less than the staff nurse and the sister who have received considerable training. This Bill will need to be examined very carefully in Committee. I believe that the purport of the Bill is a good one, but the powers in it need considerable further scrutiny.
3.35 p.m.
Lord Pitt of Hampstead: My Lords, I too must begin by apologising to the Minister in that I missed the beginning of his speech. The previous debate ended much sooner than I thought it would. One of the advantages of speaking as late in the debate as I am is that most of the points that I would want to make have already been made, and probably better than I could make them. I therefore wish to say how much I support the points that have been made about the wrongness of charging for eye testing and for dental examinations. That is a retrograde step.
I believe that the department decided on a good strategy for primary care in the White Paper. Then the gremlins of the Treasury got their hands on it and said that the costs must be reduced. So the department was forced into making these kind of proposals in order to reduce the cost.
I notice that the Minister shook his head. I am glad to see that. I hope that, having heard the arguments in the debate, he will now agree that the charges should not be introduced. They do not go well with the proposed objective of improving preventive medicine. If we are trying to improve preventive medicine, one of the things we want is the early indication of the presence of any disease. One would get that from these examinations, and that is the vital importance of them.
The Government seem to be at cross-purposes with themselves. In one breath they speak about increasing preventive medicine, but in the second breath they talk of charging for the kind of examinations that would help in that direction. I hope that this provision will be reconsidered. If the Government will not recognise their mistakes perhaps your Lordships will correct them by rejecting those clauses. I hope that we shall not hear from any side of the House during this debate that it would be unconstitutional for this House to reject certain clauses.
I want to use my time to comment on two matters. One is in the same vein as eye testing and dental examinations, but it is not quite the same. It is the attempt to cash limit the expenses of doctors through the FPC. I recognise what the Government are trying to do. They have agreed that there should be an expansion of the support scheme for general practitioners, but they want it to be a controlled expansion. I can see that that is the motive behind it. However, there are dangers in that approach. Indeed,

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many previous speakers have already mentioned some of them. It seems to me that once you cash limit, then what you have done is reduce the availability of resources for dealing with the matter. Therefore if you expand—that is what the Government say they want to do in their White Paper—then cash limiting is again a contradiction. So I hope that the Government will also look at that point because—although I am not castigating their motives—I believe that they are mistaken in their approach.
However, I want to use my time to indicate why I differ from the rest of my profession on the issue of compulsory retirement at the age of 70, which is proposed by most people. When a doctor has been practising for 50 years, as I have, he has developed a certain amount of expertise which should not be wasted. I have many friends who are accountants. When they reach my age they become consultants for their firms. Similarly, I have friends who are architects and the same applies to them. Indeed, it also happens in the case of solicitors. Therefore I cannot see any reason why the same should not apply to general practitioners.
I believe that what should be proposed is not just a blanket age at which they must stop practising, but an age at which they cease to be principals. In that case their practice will be permitted to keep them on as consultants, although it must be said that not all ageing practitioners are worth keeping on. If that is to be the approach, then I agree that the 24-hour retirement procedure should not be allowed. On the other hand, if we are to have the fixed age limit at which to retire, then I personally believe that early retirement, with full pension, is an invaluable way to make an early transfer from an elder doctor to a younger doctor. It would reduce the elder doctor's workload and, at the same time, bring in a new partner.
For example, often you have a practice which currently has more than the maximum amount of work but not quite enough to take on a new partner. However, if the eldest practitioner retires at, say, 65 and subsequently takes on a lower workload, the practice will then be in a position to take on an additional partner. Indeed, there have been several practices which as a result of the 24-hour retirement—
The Earl of Longford: My Lords, speaking out of curiosity as an octogenerian, perhaps I may ask whether the noble Lord would set any limit on that. It must be said that there are Members of this House who are active in their nineties. Does he consider that they should be allowed to go on practising?
Lord Pitt of Hampstead: My Lords, no, I would not set any limit. I am leaving that aspect to their partners. They can decide whether it is worth while keeping such practitioners on. In fact, age is not the point. If the other partners think that a certain doctor, at the age of 70, can still perform a useful service to the public, then they will keep him on as a consultant. However, if they do not think so, then they will not. I am talking about a permitted activity.
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I believe that this cut-off, so to speak, at the age of "X" because one has reached a certain age, is not the best way to use accumulated resources. In fact the expertise that the doctor had accumulated over the years is a resource. Surely such a resource should not be wasted merely because the doctor has reached a certain age.
People over the age of 70 are often—I am not quite sure how to put this—more skilled than younger people, not only in terms of the expertise and the knowledge that they have accumulated over the years, but also in the way they function. We have plenty of examples in your Lordships' House of the various ages at which people can become old. Therefore I genuinely believe that this is a serious point. Consultants have always had to go at 65 but they do not retire; they start in private practice and are working all the time. I do not believe that this is desirable.
What will happen when GPs retire at 70? They will start private practices. I do not believe that is the way to proceed, because if they are not fit enough to have a general practice in the National Health Service, they are not fit enough to have a private practice either. However, they will do so because there is nothing to stop them. The suggestion that I should like the Government to think about very seriously is that in addition to the clause which will permit the Secretary of State by regulation to decide at what age doctors should retire, there should be an additional clause giving him the power to enable practices to appoint a retiring practitioner as a consultant if he can be of service.
There is an additional argument in favour of that. Most doctors over the years establish a rapport with certain patients and those patients are very loathe to give up their doctor when he reaches the age of retirement. I know that only too well. If my suggestion is accepted, while a doctor may not be seeing 1,000 or 2,000 patients, he will still be able to see the 100 or two who want him and nobody else. At a time when we are deciding at what age GPs should cease to be principals in the National Health Service, this is also an opportunity to open it up so that the expertise and knowledge they have accumulated over the years, and the experience and rapport they have established with patients, can continue. That is my text for the House this afternoon and I hope the Government will give it careful consideration.
3.47 p.m.
Lord Rugby: My Lords, I should like to thank the Minister for his presentation of the Health and Medicines Bill, and I too will address myself to Clauses 13 and 14.
We are looking at the issue of whether the public should now pay for an eye test and a prescription without which they will not be issued with an optical appliance. The argument hitherto has been that the test is necessary because it screens the customer for all kinds of diseases. My Lords, since the practitioner is not medically trained it is not surprising that there is no accountability whatever as to the validity of that test. If one goes for a medical test to somebody who is not medically trained, I would take that to come under the heading of quack medicine.

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In the words of 1927 report which was commissioned by the Minister of Health, Neville Chamberlain, it was stated,
"By practising ophthalmoscopy and prescribing glasses for patients, who consulted them directly, opticians were claiming a degree of medical knowledge which they did not possess and positive harm might be done by prescribing glasses, where an error of refraction was accompanied by some disease which they could not detect. This is a positive danger to the public were Parliament to pass such a measure."
I hope that that aspect will be taken into account in regard to this new Bill. That fact was maintained in the later report by the Minister for Health, Aneurin Bevan, when similar findings were made known which cannot be ignored.
Those reports also serve only to highlight the recent case brought in the European Court which stated that the provision of spectacles was not a medical service. Therefore, we have three reference points. That ruling has been accepted by the United Kingdom Government.
How can it be a medical service when the optician is not a fully qualified medical person? He has direct links with the commercial pressure selling of his own medicines where spectacles are synonymous with medicines within the definition of the Act. Surely that was the very conflict of interest that the Act was supposed to remove.
Section 21 of the Opticians Act refers to a defect of sight. Does that mean a defect or abnormality of the eye? If so, that should be the wording. Using the word "sight" in that context is as indefinable as the hypothetical length of a piece of string. There is no such thing as perfect sight. Therefore an optical appliance may be deemed to be within the Bill and be entirely misinterpreted for commercial reasons.
The optician is equipped to deal only with the refractive capability and quality of the eye, and to provide compensating lenses for abnormalites where he is specifically instructed by the client. Sight is one of the most marvellous, precious, personal and private of all human senses. It can be assessed objectively against certain standards; but it cannot be defined. Section 21 has tried to define "sight" legally. It has failed. If anyone tried to define my sight, I would tell him that that was impossible. If I tried to define anyone else's sight, I should be guided by that old adage:
"Fools rush in where angels fear to tread."
It is my hope that freedom to use whatever optical appliance we wish to obtain should be allowed to us. Such interference in the enjoyment of our own sight is clearly contrary to the charter on human rights, and any provision within the Act and future legislation on restrictive trade practices should be responsive and subservient to the morality and intention of that charter. Present laws relating to the availability of reading spectacles descriminate against one age group.
Perhaps I may conclude on an historical note. In 1299 a writer in Florence is recorded as saying:
"I find myself so pressed by age that I can neither read nor write without those glasses they call spectacles (senza vetri appellati ociali)".
I apologise for my Italian but I extol that inventor.
A few years later Alessandro of Pisa died. His tomb states that he had learned the secret of how to make
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spectacles, the great gift to mankind by which our learning and civilisation came to be distributed all over Europe. Civilisation is eternally grateful to that man.
Despite that incalculably munificent gift to the human race, throughout history various charlatans and cheats have been able to latch onto and monopolise the invention for their own exclusive use in the full knowledge of the enormous riches which can be amassed therefrom unto themselves. It is inconceivable that it can still be dressed up in yet another guise and sold to the gullible with exclusive marketing rights accorded to the vendor. With that in mind, whatever the merits of Section 21 as currently interpreted, it goes only to prove the other side of that old adage:
'There's many a rotten tune can he played on an old fiddle."
I should therefore like to ask that compulsory eye tests should become voluntary eye tests, without obligation of any sort to buy from the person who carries out the test, and that reading spectacles—since such provision is highly discriminatory against the middle-age group—should no longer be provided under compulsory sight tests or prescription unless specifically requested. Sight does not come from optical appliances. It does not come to us by courtesy of opticians. It is sacrosanct between ourselves and our creator. No man-made laws can alter that.
3.56 p.m.
Lord Mottistone: My Lords, I always find it sad to follow the noble Lord, Lord Rugby, on these occasions, because he has this extraordinary bitter and implacable opposition to opticians and to their valuable contribution to health care in the modern day. To quote, for example, from Mr. Neville Chamberlain over 50 years ago when things were rather different, and even to go back to the Greeks, is not particularly relevant now. But if the noble Lord will allow me I shall not pursue that now as I have other things to say, and we can perhaps return to it at Committee stage. But it is very sad and I hope that one day he will come to see that his view is rather excessive in a very narrow direction.
My noble friend the Minister introduced the Bill with his customary skill, but I have to ask him whether it is necessary. This Bill is yet another example of patching the NHS before tackling the much more important task of radically modernising it. I have had the good fortune to read a very recent book entitled National Health Crisis: A Modern Solution by Mr. Ray Whitney, who was the Minister for Health in 1985 and 1986. I will not delay your Lordships by explaining the modern solution, though I strongly commend the book especially to noble Lords opposite, as well as of course to my noble friend.
It is interesting that one of the more wise speeches that we had, from the noble Lord, Lord Hunter of Newington, drew our attention to the report of the committee of Lord Dawson of Penn in 1920 and the book to which I referred also commends that report very highly. The point of mentioning the book in this debate is that it makes clear that the problem of providing adequate health care for all our fellow

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citizens can no longer be solved by patching the NHS as this Bill does. Something much more radical needs to be done. We as a nation—that is, government and private citizens—dedicate only about half the per capita sums towards our health care compared with most other major Western nations, and the other half is necessary. But the other half cannot come from within the present system and we have to have a radical new one.
In answer to questions in recent months my noble friend the Minister told us that a searching review is currently being conducted within the DHSS, and the Government will be announcing their proposals as soon as they are ready. If these proposals are as radical as Mr. Whitney has convinced me they must be, they will subsume this small Bill with its mini-tinkering. I therefore strongly suggest to my noble friend that the best think to do with this Bill is quietly to let it die and to free time for other important government business. I think that the noble Lord, Lord Kilmarnock, said much the same when he addressed us.
In the event that my noble friend does not take that sensible advice, there are some points in the Bill on which I must briefly comment. They relate, as has been the case with other noble Lords, to Clauses 13 and 14, which introduce charges for sight testing—a matter on which I am advised by the Association of Optometrists in which I have to declare an interest as a vice-president and on which certain other noble Lords have commented. I particularly call to the attention of my noble friend and of other noble Lords the wise comments of the noble Lord, Lord Hunter of Newington.
It is significant that all the experts, whether they be doctors or dentists, have commented so clearly and so wisely on this subject. Those of us who are laymen on the whole have been supported by a great deal of expert advice to which I hope my noble friend will pay particular attention.
I appreciate that the Bill will permit free eye tests for children, people who are receiving social security benefits, the blind and partially sighted, diabetics and glaucoma sufferers. But this will leave almost two-thirds of the population to pay for eye sight tests in the future. Those paying will include 6·5 million of the country's 9 million old age pensioners, of whom I am one. Out of 12 million people undergoing eye examinations last year, approximately 1 million were referred to their
individual GP by the optometrist or opthalmic medical practitioner because of suspected abnormality or disease. In their turn, GPs refer patients to optometrists to avoid unnecessary referrals to hospital. In that sense the two professions are acting in a complementary way. It seems strange that somebody may go to his GP and at another stage to a hospital and not pay anything. However, when part of the chain, all too frequently, is the optometrist, you have to pay unless you are in the exempted categories. That seems to me to be spoiling what has become quite a good chain of exchange of information between the optometrist and the GP.
As people get older, especialy after 60, according to a recent survey by the British College of Optometrists, they are, not surprisingly, more likely
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to have abnormalities or disease which the eye test reveals and, importantly, of which they were unaware. In recent years, based on the experience of several elderly relations, I have learnt that anything—other noble Lords have said this too—which stands in the way of their seeking primary health care is all too often latched on to as an excuse not to seek such care. It is a peculiarity of the old, which I expect will happen to us all: maybe it is already happening. The noble Lord, Lord Pitt, was talking about 70 year-old doctors. Perhaps at 80 years of age he will find that he too is resisting care from other doctors.
Although many old people can readily afford the £10 to £12 which an eye test may cost, that is just the sort of impediment that will put them off having a test for as long as possible. Then it will be discovered that some of them have an advanced state of, say, glaucoma which is irreversible—I repeat, irreversible.
Turning now to younger people, your Lordships will know that I am much concerned by the fact that faulty eyesight makes a greater contribution to road accidents than is generally accepted. The difficulty has been to persuade transport Ministers to conduct the necessary scientific study to determine whether my supposition, and that of many others in many parts of the world, is true. For example, a survey in California indicated that probably some 4 to 5 per cent. of road accidents were mainly caused by defective eyesight.
In this connection I was pleased to learn from a BBC radio programme only last Monday that drivers in some parts of Britain are being stopped and given random eye tests by the police. The resultant surveys suggest that more than 3 million drivers might have defective eyesight. Some senior police officers accordingly think that a full eye test should replace the 25-yard numberplate test. That is just what I have been advocating. It is a welcome step in the right direction and I strongly commend the police for taking this initiative. I sadly note, however, in today's issue of The Times that my noble friend Lord Ferrers, no doubt encouraged by transport Ministers, warned chief constables yesterday not to overdo the introduction of that sensible practice.
The relevance of that matter to the Bill is that it is important that drivers of all ages, and not just elderly people, should not have the extra excuse of having to pay for a proper test to put them off taking that extra measure to help make their driving safer. Thus, one wonders whether there are sufficient advantages to the Government in introducing eyesight testing charges to offset the fact that they may inadvertently be contributing to a delay in necessary health care for elderly people who are not on social security and who may be failing to take a necessary precaution to make our roads safer.
The saving to the Exchequer of not paying the £9·75 which is charged for each sight test is estimated to be £80 million per year. That must be measured against the cost to the National Health Service of extra health care for the elderly, which might have been avoided, and the cost of road casualties. The noble Lord, Lord Kilmarnock, and other noble Lords have mentioned that matter. The noble Lord, Lord Graham of Edmonton, commented upon it and we heard the moving true story which was told by my

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noble friend Lady Gardner of her experience in the field of dentistry.
There is to be a charge. The question is: What will that charge be? It can be shown, based on the current referral rates, that if only one elderly person in a thousand fails to have a potentially blinding condition arrested as early as is currently the case, the subsequent NHS and care costs could well eat up over half of all expected savings made on the chargeable eye tests of a thousand people. The other half of those savings might well be exceeded by accident casualty costs, not to mention the extra costs which my noble friend Lord Cullen mentioned in relation to equipment.
One way and another, one potential unnecessary delay in arresting disease in one person out of a thousand could eat up half the savings which the Government believe they are making. The other factors could well eat up more than the other half of those savings, and all because people delayed having eye tests or did not have them at all.
The one elderly person who fails to have a potentially blinding condition arrested as early as is currently the case will also be left unnecessarily blind. There is sufficient evidence to show that that can happen. My noble friend may say that it might not happen. I reply that in time it certainly will. I say to my noble friend: Is it worth it? I think it would be best to let the Bill die. If not, the Government should take the initiative in leaving out Clauses 13 and 14.
4.3 p.m.
Lord Prys-Davies: My Lords, although the Bill is a short one, many of its provisions are far-reaching. My noble friend Lord Ennals has made it clear that we welcome some of the provisions. On the other hand, the Bill is strangely silent on a number of issues which have been identified. But the debate has clearly brought out genuine worries on all sides of the House about the most far-reaching of those provisions.
The area of greatest immediate concern to most people is scrapping the free sight test and free dental examination except where concessions are made. I am sure that the Minister will not be surprised at that concern. We have heard strong criticism of the charges from quarter after quarter.
Yet on the need for the charges the 1986 discussion document was silent. It contained no suggestion that the Government were contemplating the imposition of charges for sight testing and dental examination. Accordingly, no opportunity was given to the consumers to make such representations as they may have wished against the introduction of the charges. Can the Minister help the House. Why was the document silent on that point?
Although it is late in the afternoon I should like to try to summarise the objections to the charges. I think that they can be brought under three or four main headings. First, it has been said by speaker after speaker that they would be inconsistent with the philosophy of the discussion document and also of the November 1987 White Paper with its central emphasis on the prevention of illness. Indeed they are inconsistent with the theme which dominated the Minister's speech. That objection has been
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powerfully voiced this afternoon by many speakers and there is no need for me to develop the argument further.
I move to the second objection. It is feared that the charges will make preventive health care in some fields less effective because more people will be deterred by the charges from applying for an examination. For many people diagnosis of diseases which show themselves in the eye or the mouth will be delayed and possibly detected too late in the day.
I accept that it is probably true that most people
who are in good financial circumstances will not be deterred by the examination fees. But I understand that the available evidence indicates that there are many people in relatively poor financial circumstances—just above the income support level—who will be deterred from applying for examination or test which they ought to seek from the NHS. I understand from the experts that there is evidence from the United States of America in particular which shows that the effect of introducing charges for access to primary health care was to reduce the uptake by 6 per cent. to 8 per cent. We are often subjected to homilies about the American experience. Has the department studied the evidence from the United States?
I turn to the third objection, which rests on the judgment that the introduction of charges will impose an additional stress on the already overburdened and expensive hospital service. That is particularly true of the hospital eye service. As I understand the position, the GP will still have the option of referring a patient free of charge to the hospital consultant for examination but at a cost to the NHS of about £25 to £50. I understand from the experts that that referral is likely to happen.
So any financial gains which will be achieved by the introduction of charges ought to be weighed against the additional costs to be borne by the hospital eye service. Moreover, the out-patient lists and the waiting time for the hospital eye service will lengthen and there are already very substantial waiting time problems in many health authorities. I repeat that one has to judge the introduction of the charge against that wide background, which was referred to by the noble Lord, Lord Hunter, in particular, in his wise counsel to the Government.
Let me be fair to the department. We must look at the case for introducing these charges that has been made out. The November 1987 White Paper—because there is no reference to it in the 1986 discussion document—advanced a specific case in support of the dental examination fee and a specific case in support of the sight testing fee; it then advanced a general case in support of both charges. The Government's specific justification for scrapping the dental examination fee is that they believe it is reasonable for patients to pay for the test. That is purely an assertion. That statement is made without further argument to show how or why it is reasonable to pay for the test. There is no recognition that there are objections to the test and no attempt is made to weigh the pros and cons.
The Government's specific justification for scrapping the fee for sight testing is based on their belief that the principle of increased competition

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should be extended to sight testing. That is to be found at paragraph 5.4 of the White Paper. Is that an acceptable explanation? In paragraph 2.10 of the White Paper, which has been conveniently overlooked until now, there is a significant hint that the Government half expect the opticians to absorb the cost, or part of the cost. It is put in an interesting way:
"Competition between opticians may well result in the cost of the sight test being wholly or mainly absorbed by opticians".
Has that suggestion been endorsed by the opticians or is it pure speculation? If the Government seriously hope that the costs will be wholly or mainly absorbed by the optician, is there not a small risk that some opticians will cut corners, rush the test notwithstanding the regulations to which the Minister referred in his opening speech, and only undertake a standard sight test in order to improve vision and not make a fuller examination which would detect the silent and early symptoms of the onset of illness? Are we right to subject people to that kind of risk?
However, the real reason for introducing charges for dental and eyesight tests—and it is acknowledged in the White Paper—is that the Government are determined that developments in primary health care, which otherwise would require £600 million of additional expenditure, are in part to be financed by the £170 million which it is said those charges will produce. The noble Lords, Lord Kilmarnock, Lord Auckland and Lord Mottistone, have questioned whether the net savings will be anything like £170 million.
As the underfunding of the NHS continues, we fear that in the future, on the basis of this precedent, the Government may be tempted to introduce charges for other routine medical examinations, and that will eventually lead to charges made whenever one consults the health service. I say to the Government that the importance of this precedent has not gone unnoticed. This could be regarded as the fourth ground of objection to the charges.
I accept that Ministers do not often take advice from this side of the House. We should therefore be very grateful if they would pay full regard to and accept the convincing advice tendered today by their friends on the opposite side of the House, from the noble Lords, Lord Cullen, Lord Mottistone, Lord Auckland and Lord Colwyn, and the noble Baroness, Lady Gardner and from the Cross-Benches by the noble Lord, Lord Hunter, and the noble Countess, Lady Mar. I hope that they will reflect on that advice and will widen the exemptions to include all groups which have been identified in the course of this debate.
I should like to say a few words about the important Clause 16. Through the mechanism of this clause cash limits will be imposed for the first time upon the ingredients of the FPC budget. This has been referred to more than once in the course of the debate. As my noble friend Lord Ennals pointed out, to this we are firmly opposed. Nevertheless, I wish to add a few words because some of the things which have been said by the family doctors show that there is within the medical profession a considerable uncertainty and apprehension about the working of
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Clause 16 and its implications for family doctors and the family practitioner committee.
We have had the benefit of listening to the thoughts of the noble Lord, Lord Hunter, about the future of the FPC and the strategies which he believes are called for. I thought that the noble Lords, Lord Mottistone and Lord Cullen, had a very fair point when they suggested that these proposals, if not the contents of the entire Bill, should be referred to the ministerial review. Can the passage of this Bill be delayed for six months so that the ministerial review may reflect upon its implications? Perhaps the noble Lord can offer us guidance.
My noble friend Lord Rea concentrated much of his speech on Clause 16 and addressed a number of precise, well thought out questions to the Minister. Each question has fundamental practical implications. Thus it would be helpful if doctors knew how cash limits are to be administered. It would be helpful if they knew what criteria the FPC would be required to apply in the administration of cash-limited budgets for staff and premises. It is important that there should be no possible basis for misunderstanding about what the Government intend to achieve through the machinery of Clause 16. It would therefore be helpful when the Minister replies if he could clarify the practical implications of the clause in terms of the use of resources, the rule of the FPC and the relationship between the FPC and the doctors.
Before sitting down, I wish to mention one other matter with has been referred to by a number of speakers in the course of the debate. It is the matter of concern to university medical research workers referred to by the noble Lords, Lord Winstanley and Lord Kilmarnock, and the noble Countess, Lady Mar. I understand that the Committee of Vice-Chancellors and Principals, a very powerful committee, has today expressed publicly its concern about the application of the sweeping powers of Clause 7 to medical research. Among other things this clause will authorise the Secretary of State to exploit research work carried out by university staff and funded by the DHSS. It will authorise him to give directions to university departments which undertake the research and to impose conditions which would be binding on the departments. In his helpful speech the Minister was silent on this power when he introduced the Bill. It is an important point because the front on which medicine has advanced during the last 40 years has been predominantly scientific and based on research in the laboratory.
The achievements have been brought about without the powers which the Secretary of State now seeks for himself in the Bill. It would be helpful if the Minister would explain what is wrong with present arrangements. Will he confirm that it is agreed in the department and by Ministers that no steps should be taken which would create an environment which could deter good research workers from entering the service of medicine in this country?
This short Bill raises many worrying issues which have been identified in the course of the debate. We promise to return to those issues when the Bill is in Committee.
4.26 p.m.
Lord Skelmersdale: My Lords, I should like to begin, perhaps rather to his surprise, by agreeing with the noble Lord, Lord Prys-Davies, when he said that the debate has largely focused on three issues: the dental examination charge, sight tests and cash limits. This reply will take some time to explain, but noble Lords will appreciate that this is only the Second Reading of the Bill and I anticipate other stages. I was grateful for the way in which the noble Lord, Lord Winstanley, made his speech. He explained the thinking behind flagging possible amendments in committee, which I believe is contained in Standing Orders.
I spoke about these three issues and I do not find it surprising that there are genuine concerns about them. In my opening speech I tried to set these proposals in the context of our strategy for the primary health care services. I do not intend to repeat myself, although I observe that there has been a fair amount of scepticism about it during the debate. Certainly the professions have welcomed the shift towards prevention and health promotion and accept the new emphasis on quality of services and the importance of the consumer. All round the House today I believe that the thrust of the White Paper has had an overall welcome.
As I said, we have been spending more on the primary health care services—43 per cent. since 1979. We all want more money for the health service. We can accept that across the political divide and even within parties. The great divide comes in deciding from where the money is to come. The Government believe that the time is now right for it to come both from patients when they can afford it and in well-trailed and specific instances, to answer the point made by the noble Lord, Lord Prys-Davies. The question therefore is, can they afford it? I am most grateful to my noble friend Lady Gardner for speaking. She agreed that they certainly can afford it. One only has to consider the experience of four years of National Health Service spectacles which have proved the point. Furthermore, it is well known that many people who have free vouchers for spectacles actually spend more than the voucher value on those spectacles.
The review has been mentioned. Although I cannot pre-empt anything which may be decided in the course of the review, I can tell the noble Lord, Lord Kilmarnock, that the health service review as such is outwith the central functioning of the primary health care services. It may be clearer if the sentence was turned round, but that is the fact.
How can I reconcile the comments that I have made with the Financial Memorandum? The answer is, quite easily. By no means all the White Paper proposals need legislation, although many of them cost substantial sums of money as I explained in my opening speech. But the proposals for the General Practice Finance Corporation on dental charges and sight tests need legislation and they happen to be proposals for saving money which will be spent on primary care development.
As I mentioned in my opening speech, by 1990–91 we plan to spend 11 per cent. more in real terms on primary health care; that is approximately £600
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million. That provides both for forecast growth and demand for additional funds for the development of primary care services along the lines of the proposals contained in the White Paper.
I believe that the noble Lord, Lord Prys-Davies, was a little mean about our White Paper proposals. I refer him to page 1 of the White Paper, which states:
"Health Ministers took a number of steps to encourage full public debate on their proposals. They set aside 8 months for the consultation period, which ended on 31st December, 1986".
They are hardly untrailed proposals—may I finish the thought and I shall then allow the noble Lord to interrupt?
A little later paragraph 2.8 of the White Paper states:
"The Discussion Document outlined various ways in which the primary care services could he improved but"—
and this is the important point—
"pointed out that developments which cost money would have to be funded through better use of existing resources. In the comments made during consultation"—
so there was no hiding this fact in the consultation—
"no one who supported such developments suggested where economies could be made to finance them. As a result the Government has considered how the substantial extra sums needed to pay for the changes it intends to make should be found".
I shall now give way to the noble Lord.
Lord Prys-Davies: My Lords, the point that I was seeking to make was that the option of scrapping the eye test and the dental test fee was not set out in the 1986 discussion document. On that point the document was silent.
Lord Skelmersdale: My Lords, I take the noble Lord's point but I stated what the White Paper said. It made clear that the resources would have to come from somewhere. In the absence of any suggestions, the Government produced their own proposals. The proposals are in the—I am sorry?
Lord Ennals: My Lords, I am sorry, I did not intend to intervene. However, I should like to know why in the White Paper the Minister did not say, "and one of the things is charges".
Lord Skelmersdale: My Lords, White Papers take a little time to produce and it is not possible to anticipate all the reactions. However, I am saying so now and I hope that that will satisfy the noble Lord. Of course it will not, but I am trying.
Two of the areas where we propose to spend more are on family doctors' practice premises improvements and extending and improving practice teams. The money available to family doctors through the cost-rent scheme and improvement grants will be increased. We shall also remove the restrictions on employment of members of the practice team to allow people to decide local priorities rather than dictating from the centre. That is something which I am sure the whole House will agree is right. More money will be available for family doctors to employ more staff, and that is the important point.
We are proposing to offer more flexibility, more local control and more money to improve the quality of services. In management terms it is simple

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common sense that this increased delegation of larger sums of money should be matched by increased accountability through the introduction of cash limits. That is the purpose of Clause 16.
Today I can give two assurances on the part of the Government that may help those noble Lords who have expressed concern about the issue. First, the overall cash limit will be higher in real terms than the current spending in these areas. How much higher will depend on our negotiations with the professions. Secondly, we intend to introduce cash limits in two, and only two, areas: that is, direct reimbursement for improvement of premises of family doctor practices and practice team development. We have absolutely no plans for introducing them in any other areas of the family practitioner services.
The two remaining areas for concern are the dental examination charge and sight tests. As I have said, the White Paper proposals for improving primary care have received widespread support. Many people who responded to the discussion document supported proposals which cost more money. Many people suggested new ideas which could cost still more money. But no one suggested where economies could be made to finance them. Following a careful review of priorities we concluded that it was right to find additional resources for primary care development from within the general ophthalmic and dental services. We feel that those who can afford it should be expected to pay a modest charge for dental examination and should no longer be entitled to a free National Health Service sight test.
I was interested in the comments of my noble friend Lord Auckland. Last night I was considering what I would say to your Lordships on the subject of people paying for their eye tests and teeth examinations and the first two lines of Hilaire Belloc's Tarantella flitted across my mind:
"Do you remember an inn, Miranda?
Do you remember an inn?"
The party opposite clearly do not. The date of my "inn" was 1951, the "inn" itself prescription charges. Exactly the same arguments as have been advanced today, which boil down to the primary health care of the nation, were advanced against that proposal. What has been the result in the last 27 years? People who cannot afford them—about 40 to 50 per cent. of GPs' patients—do not pay prescription charges. And the primary health care of the nation has never been in better fettle than today.
Prescription charges are part of the medical scene in this country. No government, either Labour or Conservative, in recent years has sought to remove them. So will it prove in the case of payment for eye tests and dental inspections. We have maintained all the existing exempt groups so that only those who can afford it will be expected to pay. Help will be available for those with incomes just above the qualifying level.
The charges involved will be modest. On dental charges many simple courses of treatment will be cheaper. Therefore, we do not believe that there will be any significant deterrent effect. The evidence of past changes in dental charges and of the competitive market for glasses does not support the deterrent argument.
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I listened with great interest to the arguments of my noble friends Lord Colwyn and Lady Gardner of Parkes. I appreciate that their speeches were based on the advice of the whole dental profession and not just the private sector. I believe, however, that I should be failing in my duty if I did not ask my noble friend Lord Colwyn one question to which he need not respond now although I hope he will during the later stages of the Bill. Over the past 10 years in which he has practised privately, has he seen an increase in patient treatment and, indeed, patient numbers? If, as I suspect, the answer is yes, it really damages the general argument that people will not pay for dental examinations. I say in passing to the noble Lord, Lord Kilmarnock, that children will certainly receive both free sight tests and teeth inspections because it is in childhood that good habits are formed. Early corrective work in children saves, as we all know, not only time, trouble and expense later on but also provides comfort at the earliest possible moment.
The noble Lord, Lord Ennals, and my noble friend Lord Colwyn will agree with me that we do not want duplication in the provision of dental services. Therefore, if the Secretary of State has a duty by law to duplicate, that most emphatically would be wrong. However, I am prepared to look at another formulation to see whether it is possible to avoid wasteful duplication in another way if such a proposal is presented to me at a later stage of the Bill.
As a matter of information, at present the community dental service in England provides annually 1.5 million courses of treatment and the general dental service 8 million. I hope that that information helps the noble Lord, Lord Kilmarnock. As regards the deterrent effect of charges, I believe that my noble friend Lady Gardner dealt very effectively with that point. It is important to put the question of deterrence into perspective.
Charges have increased each year since 1976 by as little as 5 per cent. to as much as 35 per cent. This did not lead to any reduction in the demand for dental services. On the contrary, there has not been one year—not even one—throughout this period in which the number of courses of treatment has not increased. The increase in Great Britain over that period was 6.9 million courses, from 29.9 million to 36.8 million, which is an overall increase of 23 per cent. and an average increase of 2.3 per cent. Therefore, I do not expect the measures we are taking to alter that trend, particularly bearing in mind that, even after the examination charge is introduced, in current terms many courses will cost no more and many will cost less.
On the subject of prevention, which has exercised the minds of your Lordships as regards eye tests and dental examinations, in my view the suggestions that our proposals on charging for NHS dental examinations or ending NHS sight tests are inconsistent with preventive policies in dentistry and eye care simply do not hold water. With regard to dentistry, the essence of prevention is to ensure that children's teeth remain as free from disease as possible. To ensure that, the Government are taking a number of positive measures.
More resources are to be made available to facilitate implementation of new fluoride schemes

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which are being proposed by health authorities. Clause 10 will enable health authorities to deploy more of the resources of the community dental service to preventive and educational programmes. More money is to be devoted to training programmes which concentrate upon prevention and techniques of minimal intervention.
Noble Lords may recall our recent consideration of the new dental video on this subject. The Government are also funding a three-year study of a capitation system of payment for treating children in order to see whether that system offers a better incentive to provide preventive services. Noble Lords should not overlook the fact that the Government intend to maintain the free National Health Service dental services for children and young persons. Once the Bill is enacted no one under the age of 18 will pay for any treatment. Taken together, those incentives must amount to a major contribution to prevention in the child health dental field.
That is not to say that prevention, through advice on matters such as oral hygiene and diet in the field of adult health, should be overlooked. This service will continue to be available and we hope that dentists will continue to devote more chairside time to this important activity. The question at issue is whether or not patients will be deterred from attending the dentist because of the proposal to charge for the examination. Dental charges have existed for 37 years and there is no evidence worth the name that increasing patient charges has any real effect on the uptake of treatment.
Turning to the ophthalmic services, we are ensuring that those people in the community who are most vulnerable will still get a free National Health Service test. As I explained, vulnerability does not apply only to financial vulnerability; it also applies to eye health vulnerability. I have repeated the measures announced in another place for diabetics and for sufferers and potential sufferers from glaucoma. The GPs' role in screening for diabetes has been called slightly into question by my noble friend Lord Cullen of Ashbourne. But I do believe that we have to get sight tests into proportion. No one says, for example, "Oh, today is Thursday. I shall go and have my free National Health Service sight test". People go because they want to determine whether or not they need glasses. So I have a great deal of sympathy with the speech of the noble Lord, Lord Rugby.
Opticians can in the course of the test notice signs of such diseases as diabetes and refer patients on for medical care. We would of course expect this to continue. But the overall responsibility for a patient's health rests, and will continue to rest, with his or her general practitioner who has ample opportunity to detect such diseases.
We made clear in the White Paper that we shall discuss with GPs' representatives ways in which family doctors can increase their involvement in preventive care generally. I do not want to go into detail about what we have or have not yet discussed with the BMA's General Medical Services Committee, but discussions are indeed under way. I should like to say a few words about the unregulated—
Lord Cullen of Ashbourne: My Lords, am I correct in saying that these negotiations have started in the past five days?
Lord Skelmersdale: My Lords, the specific negotiations to which my noble friend referred have indeed started in the past five days. The more general ones have been going on for some time. So to an extent I think my noble friend would agree that we were both right. But I am not sure that that gets us very much further.
I should like to refer to the unregulated sale of reading glasses. The noble Lord, Lord Winstanley, and the noble Lord, Lord Rugby, argued the desirability of permitting the uncontrolled sale of reading glasses, as I understood it, without prescription. I have listened carefully to the arguments and I have to say that I do not throw up my hands in abject horror. Noble Lords may snort, but they might also listen to what I am about to say. One cannot hold the view that the eye health of the nation will suffer from charges for eye tests and the view that the uncontrolled sale of reading glasses should be allowed.
Time is getting on but I should like to refer to people on incomes just above the qualifying levels, because obviously that is a new consideration which interests noble Lords. The people on income support and family credit will of course continue to qualify for a free NHS sight test. In addition, we are aware that there may be difficulties for people whose incomes are just above the qualifying levels. As was announced in another place on 14th April we intend to introduce arrangements to provide help for these people and, if necessary, to seek to amend the Bill for that purpose. I regret that I cannot be specific as regards the details of the arrangements at this time as they are still being considered.
Important questions were raised on income generation, on the General Practice Finance Corporation and on many other matters, but in all fairness to the House time does not permit me to go into them. I shall of course write to the noble Lords who raised those points. I believe, however, that I have covered the most important and wide-ranging thoughts of your Lordships.
We propose to redirect resources towards the proposals set out in the White Paper to permit the systematic development of the quality, scope and preventive nature of the primary care services in order to promote the better health of the nation. This Bill will enable us to do this and to make many other important changes. My Lords, I beg to move.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Firearms (Amendment) Bill
Brought from the Commons; read a first time, and to be printed.

Adjournment
Viscount Davidson: My Lords, before adjourning the House I should like to say a few, but very sincere,

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words of thanks to the staff of the House for the great support they have given your Lordships since the Easter Recess. It may not be customary to do so at this time of the year, but I am sure that noble Lords will agree that the past seven weeks have been especially onerous compared with similar periods during previous years.
We have had many late nights and that puts pressure on the Officers of the House, especially Black Rod and his team of Doorkeepers. In the enforced absence, due to illness, of the Clerk of the Parliaments, which we all regret, it has put pressure on the Clerks at the Table. It has also put pressure on the Hansard Reporters. They have all responded magnificently and I am sure that all noble Lords will agree that we owe them a great debt of gratitude.
However, in addition to all this, and as some noble Lords will have known to their cost, there was an outbreak of salmonella poisoning some three weeks ago. I do not believe that your Lordships will ever know the extent of the pressure which this put upon the Refreshment Department, but I can tell you that the staff responded so well that many noble Lords were unaware of the problems with which they had to cope. That illustrates just how well we are looked after by our staff. I should like especially to mention Mr. Bibbiani and Miss McWilliam, without whose
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initiative, improvisation and sheer hard work the whole operation of feeding Members of this House would have ground to a halt. I must point out that the other parties in the House, as well as the Cross-Benches, have naturally expressed a wish to be associated with those remarks. Therefore, on behalf of the whole House, I should like to extend to all our staff our special thanks.
Finally, to all of your Lordships and to our staff I wish a well-earned rest and hope that this short recess will enable all of us to recharge our batteries for the exciting days and nights which lie ahead.

Imperial College Bill [H.L.]
Reported from the Unopposed Bill Committee with amendments.

Northampton Bill [H.L.]
Reported from the Unopposed Bill Committee with amendments.
House adjourned for the Spring Bank Holiday Recess at ten minutes before five o'clock.