Lords Sitting of 6 July 1989

Preamble
The House met at three of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Chester): The LORD CHANCELLOR on the Woolsack.

Employment Legislation: ILO Criticisms
Lord McCarthy Lord McCarthy asked Her Majesty's Government:
When they intend to publish their response to the criticisms of their employment legislation made by the International Labour Organisation's committee of experts.
The Minister of State for Defence Procurement (Lord Trefgarne): My Lords, as requested by the International Labour Organisation (ILO), the United Kingdom Government will be responding to some of the criticisms by November of this year for consideration by the ILO's Committee on Freedom of Association, and to all the criticisms by October 1990 for consideration by the ILO's committee of experts.
Lord McCarthy: My Lords, I thank the Minister for that Answer. However, is he aware—or will he deny—that the provisional record of the 76th session of the ILO shows that the committee on the application of standards has in fact criticised the Government on eight counts, for being in breach of ILO conventions? If the Government do not accept that, then the only thing the committee can do is to go to the International Court of Justice. Therefore, what are the Government going to do?
Lord Trefgarne: My Lords, there was, I think, a report issued in March of this year by the ILO committee of experts recording six points where it criticised the United Kingdom's employment legislation. I should say that the United Kingdom does not accept any of those criticisms, certainly not at first sight. Indeed, at least one of the six points is not even part of the United Kingdom law at present.
Lord Rochester: My Lords, I can understand the Government's reluctance to accept one or two of the criticisms of their legislation by this ILO committee. However, as regards the general question of what is called "the social dimension", would it not be more productive if, instead of denouncing the concept as a whole, the Government aimed to persuade positively our partners in the Community that, for example, in the matter of employee involvement we should follow the practices of our best companies?
Lord Trefgarne: My Lords, I hope that the noble Lord will forgive me if I suggest that that proposal goes rather wide of the Question to which I am replying. As I say, the ILO committee of experts has recorded six criticisms and it is those to which we shall respond in the forums to which I referred in the main Answer.
Baroness Turner of Camden: My Lords, is the Minister aware that the committee of experts expressed the view that the cumulative effect of various pieces of legislation introduced by this Government since 1988 could, by virtue of their complexity and extent, constitute an incursion upon the rights guaranteed by the constitution? In view of that fact, is it not unwise for the Government to be considering yet further incursions into the role of industrial law as has already been indicated in this Chamber?
Lord Trefgarne: My Lords, given the fact that we find great difficulty with the position which the ILO's committee of experts has adopted on the six points, I hope that the noble Baroness will agree that her conclusion does not therefore arise.
Lord Boyd-Carpenter: My Lords, can my noble friend say something about this committee of experts? For example, who are the members and in what are they expert?
Lord Trefgarne: My Lords, as I understand it, it is a committee of experts appointed by the ILO. However, I do not know the names of individual members. But, rather than criticise the personalities involved, we should prefer to take their criticisms on their merits and respond accordingly.
Lord Nugent of Guildford: My Lords, as regards the noble Baroness's point about the Government considering further legislation in this field, is my noble friend aware that the Government would be very much at fault at present, when the country is suffering from these rail strikes, if they were not doing so?
Lord Trefgarne: My Lords, those of us who experienced difficulties in getting to work yesterday will, I am certain, agree with my noble friend.
Lord McCarthy: My Lords, surely the noble Lord would not deny that the Government's own spokesmen, according to the report of the provisional committee, praised the work of the committee of experts? Indeed, there are three successive committees who have indicted the Government on four occasions. The Government must say, if this continues to happen, whether they will conform to those conventions, or decide that they will go outside of them and line up with such countries as Burma, Panama and Nicaragua.
Lord Trefgarne: My Lords, we never said that we praised all the work of the committee of experts. As I said, the criticisms which it levelled at us have caused us considerable difficulty.

West Bank: Arab Children's Education
3.6 p.m.
Lord Mayhew Lord Mayhew asked Her Majesty's Government:
What financial contribution they make through the United Nations Relief and Works Agency to the education of Arab children in the West Bank; for how long such education has been prohibited by the Israeli Government; and what action they now propose.
The Minister of State, Foreign and Commonwealth Office (Lord Glenarthur): My Lords, our annual contribution to the United Nations Relief and Works Agency, including our share of the EC donation, is approximately £8·5 million, of which the United Nations Relief and Works Agency devotes more than half its educational programme. West Bank schools have been closed, with brief exceptions, for 16 months. We have repeatedly pressed the Israeli authorities to open them and shall continue to do so.
Lord Mayhew: My Lords, is the noble Lord aware that the Government protest, but do nothing? Further, is it right at this time that we should continue the normal relationship with the Israeli Ministry of Education as though nothing was going on, and as though we approved of their conduct?
Lord Glenarthur: My Lords, the fact is that if we were to remove this sort of support, then I think it is felt by many that it would do more harm than good.
Lord Mellish: My Lords, can the Minister say why it is that all we have heard up to this moment is an anti-Jewish argument? Why are the Israeli Government doing this? Is there not a good reason for it? Is it perhaps due to the fact that they are frightened that at the end of the day they will be stoned, have abuse hurled at them, and so on, by these people?
Lord Glenarthur: My Lords, that is certainly often expressed as a view. So far as concerns Israel, we are committed to its right to secure existence; but Israel's security is not enhanced by either a refusal to recognise Palestinian rights, or by the sort of actions we have seen in this case.
Lord Beloff: My Lords, can my noble friend the Minister persuade the noble Lord, Lord Mayhew, who has undoubted influence in the Arab world, to ask them not to use children in the front line of assaults against the occupying forces, which in itself produces the fatalities which all of us in this House regret and which were referred to in yesterday's Question Time?
Lord Glenarthur: My Lords, I am sure that the noble Lord will have noted my noble friend's remarks. The fact is that we deplore the actions which have prevented these schools from opening and we shall continue to do so.
Lord Cledwyn of Penrhos: My Lords, will the noble Lord agree that our gratitude is due to the British-based agencies—namely, Christian Aid and Oxfam—for the splendid work which they have done, and are continuing to try to do in this difficult area? Further, can he say whether those two agencies have made representations to Her Majesty's Government and, if so, what was the nature of those representations and what was the Government's response to them?
Lord Glenarthur: My Lords, I certainly agree with the noble Lord that those agencies, and others, have done a great deal to try to help the situation. We have regular contact with them through the Overseas Development Administration, but I cannot say what recent representations have been made. However, I shall certainly inquire into the matter.
Lord McNair: My Lords, does the Minister agree—I am sure that he must if he has ever visited a Palestinian school—that the cruel irony of the situation is that those children, unlike some nearer home, have an avid hunger for knowledge, which means that for them exclusion from school is a real punishment?
Lord Glenarthur: My Lords, I fully understand that point, which is why we and the 12 have made our views known on several occasions.
Lord Mayhew: My Lords, is the Minister aware that not only the British Government, but the European Parliament and the Council of Ministers, have all strongly condemned the fact that those Palestinian children have been prevented from having any education for 18 months, and have equally condemned the killing, as he stated, of 90 children and the wounding of 20,000 others by shooting and beating? Does he agree that it is extraordinary that such conduct can find defenders in the House?
Lord Glenarthur: My Lords, on many occasions over the past few weeks I have made clear from this Dispatch Box the Government's views, and I hold to those views.

Chemical Weapons: Warsaw Pact Countries
3.11 p.m.
The Earl of Cork and Orrery The Earl of Cork and Orrery asked Her Majesty's Government:
What member states of the Warsaw Pact have, or are thought to have, a chemical warfare capacity.
Lord Glenarthur: My Lords, the Soviet Union is the only member of the Warsaw Pact to have admitted possessing a chemical weapons capability. As published in the Statement on the Defence Estimates 1989, we have good reason to believe that, contrary to Soviet claims, the Soviet Union has stationed chemical weapons in Eastern Europe and that such weapons have also been produced by other members of the Warsaw Pact.
The Earl of Cork and Orrery: My Lords, I thank my noble friend for that Answer, clouded though it may be in a certain cautious obscurity. When it comes to securing by negotiation the destruction of chemical agents, is not the great difficulty the problem of how to secure mutual verification? How do Her Majesty's Government hope to achieve that if they do not even know where the stuff is being made?
Lord Glenarthur: My Lords, I agree with my noble friend that verification is one of the difficulties, but the United Kingdom has been active in the Geneva negotiations on a comprehensive, world-wide verifiable ban. As he says, complex issues remain, especially on the question of verification.
Lord Cledwyn of Penrhos: My Lords, have not the Geneva talks on the banning of chemical weapons now been going on for 18 years? Is any progress being made there? If there is no progress, what is the use of the talks? Is there any progress, for example, on the important issue of verification? Will the Minister enlighten the House on the present state of those talks?
Lord Glenarthur: My Lords, if there were no talks, I suspect that there would be even less progress. We have played a positive role as co-ordinator of the Western Group. My honourable friend the Minister of State at the Foreign Office spoke at Geneva on 15th June. He underlined our commitment to the negotiations, referred to the improved climate for arms control and gave details of the United Kingdom's work on verification issues, including our programme of trial challenge inspections at military facilities. That information may go some way towards helping my noble friend Lord Cork and Orrery.
Lord Orr-Ewing: My Lords, have the stocks been reduced since President Gorbachev came to power four years ago? NATO then estimated that there were 300,000 tonnes of chemical weapons stocked on the Eastern Front. Are the stocks still as great as that or has there been an effort to reduce them in view of the better climate under President Gorbachev?
Lord Glenarthur: My Lords, the Soviet Union has the world's largest and most sophisticated chemical weapons capability. The Soviet stated stockpile figure, which is 50,000 tonnes of toxic agent, is several times lower than Western estimates. The figure that my noble friend gave is within the range of possibilities.
Viscount Montgomery of Alamein: My Lords, can my noble friend throw any light on the suggestion that was made some weeks ago about a possible chemical warfare capability being produced in Libya?
Lord Glenarthur: My Lords, the Libyan chemical weapons programme, as thought to be the case by those who made those claims, is a disturbing one, given its links with terrorism. I assure my noble
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friend that the United Kingdom has played a leading role in increasing awareness of that threat.
Lord Murton of Lindisfarne: My Lords, does my noble friend agree that what is produced in Libya under the present climate is more dangerous than what is produced in Russia?
Lord Glenarthur: My Lords, that may well be the case, which is why we have drawn attention to it.

Homelessness and the Private Rented Sector
3.15 p.m.
Lord Dean of Beswick Lord Dean of Beswick asked Her Majesty's Government:
Whether they have any evidence that the housing measures introduced during the last session of Parliament have increased the number of houses in the private sector available for rent to people categorised as homeless.
The Minister of State, Department of the Environment (The Earl of Caithness): My Lords, the measures contained in Part I of the Housing Act 1988 deregulating new private sector lettings have been in force for less than six months, and it is therefore too soon to draw any firm conclusions as to their impact. We shall carry out a detailed evaluation as soon as practicable.
Lord Dean of Beswick: My Lords, I am grateful to the Minister for that Answer, which is the type of Answer that could have been reasonably expected. Is he aware of the figures that I quoted in Tuesday's debate in the housing section of the Local Government and Housing Bill which show that rents paid in London from public funds range from a minimum of £160 a week to £300 a week? Is that not an appallingly bad use of public funds, when for £5,500 the debt charges on a new council house could be paid? Is it not the economics of the mad-house to carry on in that manner?
The Earl of Caithness: My Lords, no. We want more diversity in our housing market. To date, there has been a great deal of restriction. There has been either owner occupation or council house tenancy. Many of those who have been on the waiting list have said that they want diversity, more choice and more opportunity. That is what the Act gave them.
Lord Graham of Edmonton: My Lords, I can confirm that the figures given by my noble friend Lord Dean of Beswick are correct. Rents for property in London are in the region of £100 to £150 a week. Bearing in mind that the Question is about how the Government's action last year will help the homeless, can the Minister tell us how the homeless are expected to find rents of £150 a week? Will he tell us a little more about how he intends to monitor the effects of last year's legislation? It is one thing to say that they intend to free the market; it is another to produce figures which convince the homeless that they are being well looked after by the legislation.
The Earl of Caithness: My Lords, we shall not know what the true situation is until a detailed survey is done. We are considering how that can be done. We may well be able to use the OPCS 1991 survey, which is associated with the Labour Force Survey. That is something that we need to keep under review. With respect, the noble Lord's question goes wider, because homelessness is part of housing. In providing an opportunity for someone to rent which was not there before the 1988 Act, one is relieving pressure elsewhere in the system.
Lord Carter: My Lords, is the Minister aware that this is not just a problem in the inner cities? Wiltshire, where I live, is a rural area with a population of 67,000. The district council's bill for bed and breakfast accommodation five years ago was £2,000 and the bill this year is £82,000. That is because 50 per cent. of the homeless are in rural areas. What plans do the Government have to solve the housing problem in rural areas, because if they do not solve it, it will wreck the social structure of the countryside?
The Earl of Caithness: My Lords, I am grateful to the noble Lord for raising that important point. As he will be aware, we are the first Government to have designed a package for rural housing. It involves changes in the Finance Act, which my right honourable friend the Chancellor of the Exchequer has brought forward; and it has meant changes to the planning system so that for the first time land can be set aside for low cost housing for local people. Extra funds have been made available to the housing associations to enable them to take advantage of the new climate.
Lord Dean of Beswick: My Lords, is the Minister aware that on Tuesday I quoted the fact that two-thirds of the improverished families living in bed and breakfast accommodation live in the London area. Without trying to make political capital out of it, would it not make more sense for the Government to release some of the funds to local authorities or to give permission for them to use more of the capital assets which the Government intend to diminish under the Bill at present going through Parliament? That would allow local authorities to have a substantial increase in the house building programme in conjunction with housing associations. These are only two areas of housing which could possibly cope with homelessness on the scale that we have. The private sector has neither the will nor the ability to do such a job under the Government's legislation.
The Earl of Caithness: My Lords, I am very interested in that question from the noble Lord. He said clearly that it would be the local authorities in conjunction with the housing associations. That is a major step forward, it is what we are seeking to pursue. There is a role for the local authorities which have about 4·5 million properties of their own. Many need repair; indeed, many are now receiving repair. There is due provision for the housing associations and there is the private rented sector housing. Under the Local Government Act 1988, the local authorities
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can help the private rented sector by giving help of between 50 and 75 per cent. No one body can solve the very difficult problem. It must be a combination of local authorities, housing associations and the private sector.
Lord Stallard: My Lords, I accept that no one body can solve the problem. But will the Minister accept that all the bodies trying to solve the problem, including the Housing Corporation, have had their finances and subsidies slashed by the Government?
The Housing Corporation, for instance, had a £35 million cut between 1987 and 1989. We all know about the huge cuts in the local authority subsidised expenditure. Is it not true that government policies, of which the 1988 Act is just the latest example, have worsened an already serious housing situation? The Government can take no joy from the fact that the situation is getting worse every day and every night in London.
The Earl of Caithness: My Lords, I am glad to be able to tell the House and to reassure the noble Lord that he is wrong on this matter. Capital expenditure on housing this year, 1989–90, will be £4·2 billion. That is 12 per cent. higher than previously planned.
Lord Stallard: My Lords, I must correct the Minister. My figures, or the figures from his documentation, show that the Housing Corporation was allocated £686 million in 1987. For 1988–89 it has £655 million; that is a reduction of £31 million, no matter how one adds it up.
The Earl of Caithness: My Lords, the noble Lord has taken a specific item and I am unable to check his figures from this position at the moment. Perhaps I may re-emphasise that the total capital expenditure for local authorities and housing associations is 12 per cent. higher than previously planned this year. As the noble Lord will be aware, there has been a substantial increase in funds to the Housing Corporation. By 1991–92 we expect its funds to be 60 per cent. higher than now.
Lord Jenkins of Hillhead: My Lords, as a matter of statistical interest, what is the validity of "previously planned"? Can the Minister tell us how the figures compare with what previously happened?
The Earl of Caithness: My Lords, the statistics that I gave show that funds have not been cut. They have been increased.

Business
3.23 p.m.
Lord Denham: My Lords, it may be for the convenience of the House if I announce that the Report stage of the Electricity Bill will be adjourned at about 7 p.m. for about one hour and that during this adjournment the Cereals Marketing Act (Application to Oilseeds) Order 1989 and the Fisheries Act 1981 (Amendment) Regulations 1989 will be taken.

Religious Prosecutions (Abolition) (No. 2) Bill [H.L.]
Lord Sefton of Garston: My Lords, I beg to introduce a Bill to abolish prosecution for the expression of opinion on matters of religion. I beg to move that the Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Lord Sefton of Garston.)
On Question, Bill read a first time, and to be printed.

International Westminster Bank Bill
3.25 p.m.
Read a third time, and passed, and returned to the Commons with amendments.

London Docklands Railway (Beckton) Bill
Read a third time, and passed, and returned to the Commons with amendments.

Social Security Bill
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Skelmersdale): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the amendments for the Report stage of the Social Security Bill be marshalled and considered in the following order—

Clauses 1 to 8,

Schedule 1,

Clauses 9 to 20,

Schedule 2,

Clauses 21 and 22,

Schedule 3,

Clause 23,

Schedule 4,

Clause 24,

Schedule 5,

Clause 25,

Schedule 6,

Clauses 26 and 27,

Schedule 7,

Clauses 28 to 34,

Schedules 8 and 9.—(Lord Skelmersdale.)

On Question, Motion agreed to.

Consolidation Bills: Joint Committee
3.26 p.m.
The Lord Chancellor (Lord Mackay of Clashfern): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the Lord Renton be appointed a member of the Joint Committee in the place of the Lord Campbell of Alloway.—(The Lord Chancellor.)
On Question, Motion agreed to.

Water Bill
3.27 p.m.
The Earl of Caithness: My Lords, I beg to move that the Commons reasons and amendments be now considered.
Moved, That the Commons reasons and amendments be now considered.—(The Earl of Caithness.)
On Question, Motion agreed to.
MOTION AND AMENDMENT MOVED ON CONSIDERATION OF
COMMONS REASONS FOR DISAGREEING TO CERTAIN LORDS AMENDMENTS, AND COMMONS AMENDMENTS IN LIEU OF ONE OF THE LORDS AMENDMENTS
[References are to HL Bill 33 as first printed by the Lords. The Commons reasons and amendments are printed in italics.]

LORDS AMENDMENTS
1 Clause 37, page 39, line 32, after "of" insert "wholesome".
2 Page 39, line 33, at end insert—
"(aa) for providing water of a standard of wholesomeness prescribed under section 38(2A) or (2B) below".
3 Clause 38, page 40, line 16 at end insert—
"(2A) Without prejudice to the generality of the duty conferred by subsection (2) above, regulations under that subsection shall include in any standard of performance a requirement for an undertaker to achieve the levels of drinking water quality specified in EEC Directive 80/778 by a date not later than the date specified by the Secretary of State under subsection (2B) below in respect of each undertaker.
(2B) The date or dates to be specified by the Secretary of State by order under this subsection shall be that or those which either—

(a) Not later than 31st December 1989, have been agreed by the Secretary of State and the European Commission; or

(b) Where no such agreement has been reached by the date referred to in paragraph (a) above, 1st September 1993.

(2C) Where, before the date specified in an order under subsection (2B) above, any further terms of a Directive by the European Commission relating to drinking water quality are introduced, the Secretary of State shall, in consultation with the Commission, by regulations establish the shortest timetable for compliance by each water and sewerage undertaker as he considers to be reasonably practicable.".
4 The Commons disagreed to these amendments for the following reason:
Because adequate provision is made, without the amendments, for ensuring that water supplies that do not comply with EC Drinking Water Directive 80/778 will do so as quickly as possible, taking account of the practicalities, and the making of workable schemes for guaranteed customer standards would become impossible as a result of uncertainties about the effect of the amendments.
MOTION MOVED ON CONSIDERATION OF COMMONS REASON
4A Lord McIntosh of Haringey rose to move, That this House do not insist on their Amendments Nos. 1 to 3 to which the Commons have disagreed but propose the following amendment in lieu thereof—
After Clause 80, insert the following new Clause:
"Publication of investment programmes.
—(1) The Secretary of State shall, before any date on which shares in any undertaker are to be offered for sale, publish an investment plan in respect of each such undertaker specifying the steps to be taken by that

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undertaker in order to secure compliance in respect of the supply of drinking water with such parameters of EC Directive 80/778 or other directives relevant to the quality of drinking water as may be specified in regulations made under this section.
(2) The Secretary of State shall before publishing any plan under subsection (1) above, consult the European Commission as to the timescale and content of the proposed investment plan.
(3) The Secretary of State shall for the purposes of subsection (1) above specify as a parameter to which this section applies any parameter of a relevant directive, a breach of which is likely, in his opinion to carry a significant risk of danger to the health of any person.".
The noble Lord said: My Lords, some Members of your Lordships' House will know that it is not my general practice to seek to overturn amendments when the Commons have overturned our own amendments. My general view is that the Commons, as the elected Chamber, ought to have the last word on these matters. However, in this case it seemed necessary to put down a further amendment in lieu, and there are specific reasons which have arisen since the matter was considered in Committee in your Lordships' House—and indeed even since the matter was considered in another place on Monday—why the amendment should be put forward.
I beg to move that this House do not insist on their Amendments Nos. 1 to 3 to which the Commons have disagreed but propose in lieu thereof the new clause, which has the sub-heading, "Publication of investment programmes" as set out in the Marshalled List.
As I said, there are specific reasons since this matter was last considered which make it necessary for the House to consider the issue again. The most important perhaps arises from the visit of the Minister of State for Water and Planning, Mr. Michael Howard, to Brussels last Wednesday when he met Sr. Carlo Ripa de Meana, the European Commissioner for the Environment. When that meeting was reported by the Secretary of State in another place, he described the meeting as a constructive and fruitful discussion. He claimed that the commissioner accepted the Government's resolve in the matter.
I do not know what is meant by "accepted the Government's resolve in the matter." It is clearly a phrase designed to mean as little as possible. But whatever the Secretary of State intended, the fact of the matter is that this was a meeting at which no negotiation whatsoever took place. It was the first occasion when Mr. Howard had met the commissioner, and I have confirmed that there was no negotiation of any kind at that meeting. It was largely a formal meeting.
To claim the support of the European Commission for the removal of our amendments, as in effect the Secretary of State did, is not an adequate representation of what took place and it ran the risk of misleading honourable Members in another place about the position of the European Community in respect of drinking water quality directives.
Not only was that a non-meeting in the negotiating sense, but this has been confirmed by the fact that
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only yesterday the European Commission issued a decision to the British Government—not on drinking water quality on this occasion but on river water quality. The Commission decided that it would apply to the European Court of Justice, to seek compliance by the British Government with two directives: one of 1983 on cadmium and one of 1984 on hexachlorocyclohexane, or HCH, because the UK is in breach of those directives, which in the first case should have been implemented by 26th September 1985 and in the second case should have been implemented by 1st April 1986.
The note from Brussels states that the UK is in breach of the directive on various aspects. It states that the directive has been implemented by means of circulars which are not public, may be changed at any time and are not even seen to be binding for the administration. It states that the circulars do not contain some of the quality objectives required by the directive and do not require the competent authorities to fix emission standards for each individual cadmium discharge and that the UK authorities have failed to establish a report on each quality objective chosen and applied by them.
So it is clear that we are debating this in a context where, even on matters which have not been debated in this House, the British Government are still failing to meet the Commission's requirements as regards water quality in this country. The British Government forced the Commission to go further than the reasoned opinion which was debated in your Lordships' House on drinking water quality, to the final stage of the process, which is a decision to apply to the European Court of Justice. It is quite clear that there has been no effective meeting of minds between the British Government and the Commission on water quality. It is also quite clear that any claims that this legislation satisfies the Commission are very wide of the mark. That is why it is necessary to come back.
There is the additional factor that only today the accounts of the regional water authorities have been published. We have not yet had a chance to study them, and no doubt the Minister has not had a chance to study them either. However, it will be very interesting to see whether the investment expenditure of the regional water authorities shows that there is any significant progress as regards improving drinking water quality and river water quality. We shall have to seek another occasion than the passage of this Bill in order to debate that matter in your Lordships' House, but it is another example of the matters which should have been available before the passage of the Bill was sought. It is another of the aspects in which the Water Bill is clearly inadequate.
The new clause that I have tabled does not seek to reinstate the amendments to which the Commons disagreed. It is different from them in three important ways which I believe answer the points that were made by the Secretary of State in another place when the matter was debated. First of all, we are not specifying a particular date for compliance. The Secretary of State put forward the extraordinary argument that any date for compliance would be illegal because the date for compliance was 1985 and

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therefore it should be done straight away. He is not saying that it will be done straight away; he is merely saying that a reasonable and feasible date cannot be put forward. It is obvious that that is an extraordinary argument, but it is not one that I wish to enter into now. Therefore, we have not put a date down, but we have said that before the shares are offered for sale there should be an investment plan published for each undertaker specifying the steps to be taken in respect of the supply of drinking water within the parameters of EC Directive 80/778, which was the one referred to in our earlier amendments, and other directives relevant to the quality of drinking water as may be specified in regulations.
We make two further provisions: first, that the Secretary of State shall consult the European Commission. We are not suggesting that the Secretary of State should agree with the European Commission because clearly it is not in our power to direct Secretaries of State to agree with anyone who is not in the control of the British Government. Thirdly, we are proposing in the third part of the new clause the restriction of breaches under this section to those which carry, in the opinion of the Secretary of State, a significant risk of danger to the health of any person. In other words, we are answering the point made by the Secretary of State in another place when he said that some of these water quality standards were cosmetic, and that, like manganese and iron, they affected the colour or clarity of the water but did not affect matters of health.
We are now talking about a new clause which would require an investment plan to be produced with a timetable for compliance before flotation; that that plan should be the subject of consultation with the European Commission and that it should be restricted to those matters of drinking water quality which carry a significant risk of danger to health. I cannot for the life of me think why the Government should not accept these amendments because all of the things we are asking here will have to be in the prospectus anyway. But what is necessary is that there should be other reasons apart from commercial reasons for their being in the prospectus.
No sensible investor would wish to apply for shares unless there was an accepted timetable for the improvement of drinking water quality standards, as it is clear that that has a fundamental effect on the viability of the water companies and the price of their shares. However, it does not seem to us satisfactory that that should be only in the prospectus. It seems to us necessary that Parliament should specify that the investment plan and the compliance programme should be on the face of the Bill. Only in that way can Parliament fulfil its fundamental responsibility both to water consumers and to the potential investors in the water companies.
I suggest to the House that these are improved amendments. They answer the points made by the Secretary of State in another place in rejecting our amendments, and they provide real protection to water consumers and to investors in the industry. I commend them to the House. I beg to move.
Moved, That this House do not insist on their Amendments Nos. 1 to 3 to which the Commons have disagreed but propose in lieu thereof the new clause (Publication of investment programmes) set out in the Marshalled List.—(Lord McIntosh of Haringey.)
Lord Boyd-Carpenter: My Lords, I have always admired the ingenuity of the noble Lord, Lord McIntosh, but he has excelled himself this afternoon. He began with the very proper affirmation that he did not favour this House getting into conflict with another place by a direct rejection of its views and insistence on an amendment which it had rejected. He then sought to justify this amendment in a very curious way by references to a meeting in Brussels which he himself described as a non-meeting and whose relevance to this discussion would therefore seem to be a trifle tenuous. He further suggested that what the Commission was talking about at the moment was a reason for a very last minute amendment to the Bill. The noble Lord knows perfectly well that international discussions on matters of this kind need to take time. To try, on the pretext of their relevance, to slip in a further amendment to a Bill in its final stage is a misuse of language.
If the Commission has views that it wishes to express, I am perfectly certain that my noble friend in the Government will have discussions with it. But the idea that we should in great haste, at the last minute at this stage of the Bill, slip in something which the noble Lord thinks may appease the Commission does not seem to make very practical sense.
Let us look at the amendment which the noble Lord proposes. He hastens to disassociate it from the earlier amendment which, in circumstances which your Lordships will well recall, was carried. However, it has certain basic similarities, and in particular it has the similarity that it is plainly intended at least to slow up and to hinder the process of privatisation. That of course is the real purpose—
Noble Lords: Hear, hear!
Lord Boyd-Carpenter: My Lords, I notice that noble Lords opposite say "Hear, hear". I am glad to carry them with me. That was the real purpose of the earlier amendment and that is the purpose of this amendment.
If noble Lords will look at the first paragraph they will see that the Secretary of State has to publish an investment plan before any shares are offered. What is meant by "an investment plan"? That is surely one of the vaguest of matters. It makes it extremely difficult to foresee the future. It would be extremely difficult for a new company to make arrangements if an investment plan is imposed on it by the Secretary of State. If an investment plan means anything, it means the allocation of certain specified sums, year by year, although the situation may well change, though prices may well change, though needs may well change. The rigid framework of an investment plan, though designed in theory to assist in the provision of purity of water, in practice would

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put the new companies in a straitjacket. Nobody knows better than the noble Lord that any such provision would be at least an immense discouragement to investors who were disposed to take up the offer and buy shares in the company that is being privatised.
Then there is the extraordinary provision in paragraph 2 that the Secretary of State must consult the Commission. The noble Lord went out of his way to say that he did not intend by that that the Secretary of State should be bound by the views of the Commission, but that he should consult the Commission. No doubt there are circumstances in which the views of the Commission might be helpful, but few things are less helpful than statutory consultation of that kind. It means that an approach has to be made, and if there is disagreement that disagreement has to be published. It will become known. What useful purpose would be served by a formal consultation, ending in disagreement, and followed by publication of the disagreement, with all the ill will and difficulty that that would cause?
Then there is the extraordinary provision, barely comprehensible, referring to:
"any parameter of a relevant directive".
As I understand it, it means that, subject to the direction of the Secretary of State, the new company would have to follow any new provision, any new order or any new decision that emerges over the years. There again, nobody knows better than the noble Lord that that would be a very great discouragement to investors.
We have reached the final stages of this Bill. Your Lordships have decided, after long debate—and no one can complain that the debate has been unduly short—that the water industry shall be privatised. The only effect, and I suggest the only purpose, of the amendment is to make that process, if not impossible, at any rate a great deal more difficult. To that extent it simply echoes the purpose, though the phraseology is different, of the earlier amendment which another place rejected.
In those circumstances, I hope that your Lordships will feel that, whatever the merits for the future of discussions with the Commission and whatever the merits of the guidance which the Secretary of State can undoubtedly give to the new water companies, to impose this straitjacket on the companies at this moment would be utterly destructive of the work which your Lordships' House and another place have done in going forward with the privatisation of water.
I cannot help recalling, because it is most relevant, that this argument is a great reinforcement of the argument for privatising water. Years ago one drank tap water in this country with complete confidence. At that time one was advised very strongly when on the continent of Europe not to drink tap water but to buy expensive bottled water. Then the industry was nationalised. Under nationalisation the process has apparently been reversed and we are now in the strange position—very strange to those of us who were brought up under the older dispensation—of being told that English tap water is dangerous and
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European and continental water is safe. If one wants a stronger argument against nationalisation than that one will need to go a long way to find it.
3.45 p.m.
Lord Ezra: My Lords, we are concerned here with the quality of drinking water. It is clear from debates in this House and the other place that there is no disagreement about the need for us as a country to conform with EC Drinking Water Directive 80/778. The only issue is the timing. When your Lordships' House previously considered this subject we concluded that a time should be set, and the time that we proposed was 1993. The other place—as is reflected in the document before us—considered that that could not be done, taking account of the practicalities, but that there are schemes in hand to bring it about at the earliest practical date. That is the issue.
The amendment which the noble Lord, Lord McIntosh of Haringey, has put forward suggests that, in view of the fact that there is agreement that we should achieve those standards of drinking water quality and there is disagreement about the date, the prospectuses for the sale of these companies should include a clear indication about what the companies intend to do in order to achieve those standards. As a potential shareholder, if I should be so persuaded, I would want to know that. The country having committed itself to achieving those standards, I would want to know what is to be done and what measures are to be taken by the companies to achieve those standards.
I am a little surprised that the noble Lord, Lord Boyd-Carpenter, should oppose the amendment. All it asks for is that potential shareholders should be very clear about what, as a result of a decision of Parliament, will be required of the companies to achieve those objectives. I think that it is very fair and proper that the prospectuses should state that.
Looking at the matter quite objectively, I should say that this is a very fair amendment in view of the agreement that we have reached that water standards should achieve the levels set out in the European Commission's directive. On those grounds, I strongly support the amendment proposed.
Lord Trafford: My Lords, I congratulate the noble Lord, Lord McIntosh, on the way in which he presented the proposed new clause. I also associate the noble Lord, Lord Ezra, in those congratulations for his remarks, because they are indeed seductive. However, I prefer to address myself to the amendment and its consequences rather than to an argument about the wholesomeness of water.
I do not think that there is any noble Lord on any side of this House who does not agree that we require a certain level of wholesomeness of water in the near future. As the noble Lord said, up to a point it is a question of timing. The noble Lord, Lord McIntosh, suggested that in bringing forward his amendment he was in some way facilitating that process, benefitting the consumer, and also benefitting the investor who would then know what he was buying.
This is a seductive amendment because it is a wrecking amendment. If the amendment were

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carried and became part of the Bill, if there were to be disagreement between the Secretary of State and the European Commission and there was a public row about the contents of the so-called investment plan, at the least that would cause great delay. Incidentally, the term "investment plan" appears nowhere in the Bill. I assume that it refers to the prospectus, but I do not know because we have not been enlightened on that point. It could cause a to-ing and fro-ing both about the content—the new clause refers to the content—and the timescale, so there is delay and argument about the content.
What does that mean in effect and in practice? It means something quite different to what the noble Lords, Lord McIntosh and Lord Ezra, have argued. In effect, it means that we are asking the European Commission to decide the content of the prospectuses and, therefore, the date of the prospectuses and the price of the flotation. In other words, the amendment drives a coach and horses straight through the central core of the Bill. It takes away even from Parliament, let alone from the Secretary of State, the decision with regard—
Lord Ezra: My Lords, perhaps—
Lord Trafford: My Lords, I shall give way in a moment. It effectively takes away from the Secretary of State—that is not immediately apparent, but it is apparent if one reads carefully between the lines of the amendment—powers with regard to the price, date and timescale of water privatisation which, as my noble friend said, the House has in principle approved. The noble Lord, Lord Ezra, wished to intervene.
Lord Ezra: My Lords, I thank the noble Lord for permitting me to speak at this stage. I should merely like to say that that is certainly not what I was saying. I was saying that if we—as two Houses of Parliament—agree that we shall attain the objectives of the directive set out in the EC regulations, it is not unreasonable that, when the companies are floated, they should indicate how they are to achieve what Parliament has decided that they should achieve.
Lord Trafford: My Lords, I thank the noble Lord for those comments. I do not think that they contradict anything that I have said. I congratulated the noble Lord on the persuasiveness with which he spoke on the wholesomeness of water. I do not disagree with what he said. I am addressing the amendment. He addressed a general principle with which many might agree. He then jumped a huge intellectual step and said, "The amendment will achieve those objectives". I do not think so. That is the point of our difference. It is not with regard to the achievement of satisfactory water. I certainly do not disagree with him on that point.
I believe that, in his intervention, the noble Lord is again trying to suggest in some way that the amendment will achieve those objectives. My argument is that it will not achieve those objectives
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because first—I do wish to go over what I have said before—it will wreck the Bill. It is essentially a wrecking amendment. Secondly—I had not developed this point prior to the noble Lord's intervention—there are three secondary considerations. However, the most important is that the proposal drives a coach and horses through the Bill.
The Secretary of State is allowed to choose any number of parameters from the very many in the EC directives. That means that he can pick and choose whichever he likes. If the measure has to apply to the health of any person, it could in many respects make a nonsense of the situation. Perhaps I may give an example from personal experience. Many noble Lords will know that I work in the field of renal dialysis. One of the great dangers for people on renal dialysis is the high aluminium content in the blood. That is achieved because for various reasons substances which contain aluminium are given. That is in addition to the question of dialysis water and ordinary water feeding every machine. Those people are therefore peculiarly susceptible to the problem. To make the water fit for any healthy person, and particularly for those people in this group, one would need deionisers all over the country.
I know that that is not what the noble Lord was saying, but, if one puts things like that on the face of the Bill, that is what it could mean. That is how those who wish to wreck the undertaking could take advantage of the loopholes and drive a coach and horses through the Bill.
Surely the proposal would be an administrative nightmare. We cannot put forward the prospectus—I assume that that is what the investment plan means—until such time as tile European Commission has been consulted. I do not know how long that will take. I do not know what will happen if there is argy-bargy backwards and forwards between London and Brussels. I do not know what will happen if there is disagreement. I do not know how the flotation would be carried out if most or even part of the so-called investment plan were subject to disagreement.
However, despite what I call those secondary points—the administrative nightmare, people's health and innumerable other grounds from which one could pick and choose—I come back to the fundamental point that the House has already approved in principle the privatisation of water with the intention that the industry should be floated later this year. The new clause would wreck that proposal. It would wreck it in theory and in practice. Anyone who reads between the lines of the new clause will inevitably come to the conlcusion that it is a wrecking amendment. It is for that reason—not because of any disagreement about the quality of water—that I hope noble Lords will reject the amendment.
Lord Molloy: My Lords, I am of the opinion that the speech by the noble Lord, Lord Trafford, to which we have just listened, is one of the most exaggerated I have heard in 35 years of political life. To describe this as so dangerous a new clause that

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it will smash the privatisation of the water industry is a crass absurdity.
We are not now arguing about whether water should be privatised or not; it will be privatised. The new clause proposed by my noble friend suggests that in so far as water will now be privatised and, therefore, that British water will be in private hands—Italian and Japanese as well as British—the House is of the opinion that there should be certain directives to defend the position under privatisation. In my view, it is absurd that those people will henceforth control British water, despite the fact that it droppeth from the heavens above.
However, those people should not be able to say that they can do whatever they like because they own British water. A sensible Parliament would impose certain responsibilities and restrictions. I hope that the House will look at the matter in that light. The word "privatisation" does not tell us much; it does not tell us who will ultimately be the owners of British water. The British people would like some idea of what restrictions or responsibilities—responsibilities rather than restrictions—will be placed upon them. That is the idea behind the new clause.
When the noble Lord, Lord Boyd-Carpenter, speaks of the last minute of a debate in Parliament, I must ask: what is wrong with the last minute? Is there something superior about the first minute and all middle minutes so that, as the debate goes on, the responsibility of the last minute diminishes? That is equally absurd. On the basis of the absurdities that we have heard from the noble Lords, Lord Boyd-Carpenter and Lord Trafford, all that I ask in support of my noble friend's amendment is that we should agree to the new clause, not for any party-political reasons whatsoever—
Noble Lords: Oh!
Lord Molloy: My Lords, I have already said that I am surprised that noble Lords opposite do not agree with me that it is almost certain that water will be privatised. Do they disagree with that? What a silence! Henceforth, do they not also agree that certain responsibilities should be placed on those who will ultimately own the water and that, at the same time, it might be prudent and sensible to co-operate with the EC with regard to safety in the supply of water? On those simple grounds, I believe that people have the right to see that Parliament places responsiblities on those who will own the water. Parliament must ensure that there is sensible co-operation with other countries. On that basis—it is a very simple request—I hope that the House will agree to support my noble friend Lord McIntosh.
4 p.m.
Lord Renton: My Lords, whether or not your Lordships agree with privatisation, I am sure that we all wish progress to be made as soon as possible when the Bill has reached the statute book. But my great fear with this amendment is that in fact it will delay matters very badly. Placing a responsibility on each of the the water undertakers in effect to obtain
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permission from the European Commission before its investment plan can be approved not only introduces a bureaucratic process which was not in the Bill before but is bound to lead to delays, as has been pointed out.
Quite apart from that, I must say that subsection (3) of this amendment introduces an extraordinary situation. It may not be fully realised but when it refers to parameters there are already 66 parameters—that is, detailed tests. They are contained in either EC Directive 80/778 or the other directives referred to in subsection (1). As my noble friend Lord Boyd-Carpenter pointed out, there is no end to the number of parameters that may be added in the future.
What then shall we do? We could find that each water undertaker, for perhaps several million consumers of drinking water, would be at risk of having the whole of its investment plan and the whole of its attempts to purify its water held up because one consumer complained that there was one parameter which fitted his case that had not been met. As my noble friend said, that would be an administrative nightmare.
I hope that those noble Lords who have been tempted and perhaps seduced by the terms of the amendment, which at first sight may look as though it has something to commend it, and have been tempted and perhaps seduced by the calm way in which the noble Lord, Lord McIntosh, introduced it at this late stage, will realise that to accept this amendment strangely and paradoxically enough would be to defeat its own purpose. It is a self-defeating amendment.
Lord Addington: My Lords, I originally supported the amendment which was rejected by the other place. I supported it on the grounds that it would improve the standards of drinking water and that a certain standard would be met by a certain date. The amendment was not about the privatisation of water; it concerned the health of people who happen to be drinking water and the surety and safeguards that they would have for their health.
This new series of amendments has the same aim. I appreciate, as the noble Lord, Lord Trafford, said, that every now and again there appears one person who might be affected by one particular substance in the water. I would go further and expand his remarks to say that there are numerous people who might be affected by any number of substances in foods. I have a terribly bad reaction to rye in my diet but I have no intention of suing or taking anyone to court because they happen to have grown rye or allowed it to enter my food in some disguised form.
The whole emphasis of this amendment is to make sure that people will have safeguards and that there is a set standard which will be met in their drinking water supply. The European standard is one that is readily available. Moreover we are a member of the European Community. I suggest that making sure that we have some kind of plan or way of knowing when that standard will be met would not be a wholly bad thing. We should know when we are going to do things. People should know when they have to meet targets.

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That sort of guarantee surely will not be a drawback to privatisation. Ultimately, if people know that those standards will be met and there is some way of making sure that they are met, we shall not have to endure this kind of debate and procrastination about when investment should take place. I suggest that private companies may possibly be a little less responsible to the general public than governments have been. As has been brought out in debate after debate in this House, virtually every single government, even those way back before I was even born, have fallen down on their duty to invest in the water industry.
Baroness Blatch: My Lords, in my mind there is no doubt that this is at worst a wrecking amendment and at best it is certainly a delaying amendment, as my noble friend Lord Renton said. I believe that the noble Lord, Lord McIntosh, and his colleagues have done much to create a perception which distorts the real situation. Therefore I want to deal with some of the misinformation that has been propounded throughout the whole passage of the Bill through the House.
Indeed, there are 66 requirements of the EC directive. Of those, 19 concern aesthetic or naturally occurring substances, 24 concern substances which are undesirable in water in excessive amounts, four concern hardness or softness, 13 concern toxic substances and 6 concern bacteriological content. Most supplies in this country and in Wales comply with those requirements and the majority of non-compliance relates to colour or turbidity, which are not related to health. Indeed those requirements which are concerned with health are treated with the utmost urgency. Bacteriological and toxic requirements are probably the highest on people's list of concerns. Of those 19 requirements in that particular field, most of them are met. Indeed, in England and Wales we have always had the highest standards of bacteriological purity in water. There are only three areas—small suppliers which do not conform—and they are already being dealt with.
With reference to the toxic parameters, there are small pockets of non-compliance. For example, there are 100 people who receive water with small excess amounts of cadmium; that too is in hand and being dealt with.
The other area of concern is nitrates. All supplies currently meet medical requirements. Nevertheless some supplies, as we all know, are higher than the limits in the directive. These too are being tackled and most supplies should be up to standard by 1993; all supplies should be up to standard by 1995. So the health aspects of drinking water are well in hand.
Many of the other requirements—for example, the colour and turbidity to which I referred earlier—require wholesale replacement of pipes and apparatus. That cannot be done overnight and it is almost impossible immediately to say how long it will take. But it is also worth noting that in thousands of homes in this country there are still large quantities of lead piping. That too has to be dealt with. It is not of course under the control of either the water authorities or the water companies.
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The water companies will be required on every single one of those 66 requirements to negotiate with the Secretary of State. They will have to draw up a contract and that contract will be very one-sided. It will be one-sided in the sense that the water companies will have to deliver to the standards required by the contract. They will have no powers to vary the contract. In fact the only variable power will lie with the Secretary of State, who will have the power to toughen the contracts. Therefore it seems to me that that work is also well in hand. As a last resort the companies too, if they continue not to comply with the standards, can lose their licences. That is a full backstop on the part of the Secretary of State.
Finally, there is the point about shareholders. It is my view that if the shareholders want a dividend, then pressure from them, from the community and from the Government to conform to the standards will be very real. Shareholders will not wish their companies to be constantly risking financial penalty.
I believe therefore that this amendment is not acceptable. The highest priority must be given to programmes for maintaining safe water. Programmes to improve taste and colour and the other aspects which do not affect health will take longer. Programmes are in hand and are being negotiated. It is worth repeating that most of our water supplies meet all the EC requirements. The deficiencies that exist affect only some supplies, and most of these concern appearance and taste.
The noble Lord, Lord McIntosh, and his Labour colleagues, as I said earlier, have been responsible for scaremongering on this issue. They have put about this information and they have been quite successful. They ought to congratulate themselves on the fact that they have convinced the public at this time that our water is undrinkable. I support a sustained programme for improving our drinking water.
Lord McIntosh of Haringey: My Lords, I have been accused in person of scaremongering in this House. Is that in accordance with Standing Order No. 29, which relates to asperity of speech?
Baroness Blatch: My Lords, as a relatively new girl I am not sure of the rules of the House. If it is not in accordance with the rules of the House, I apologise. I am saying that there has been large scale scaremongering and misinformation on this issue. Drinking water in this country is drinkable and is safe. I drink it and I have survived. There are many noble Lords a great deal older than me who have drunk our drinking water and they still survive. We should get the whole issue into context.
I support the sustained programme of improvement to meet all these standards. I believe that the systems are already in place to ensure that the companies will be required to achieve compliance in the shortest possible practical time. I shall oppose the amendment and support the Government.
4.15 p.m.
The Earl of Caithness: My Lords, of the 350 or so amendments that your Lordships made to the Bill, the other place have disagreed with only six covering just two groups. I am sure that your Lordships will agree that that is a clear indication of the value of our work as a revising Chamber, and of the many important modifications that your Lordships have made which will pass into legislation.
However, I indicated at Third Reading that we could well return to this group of amendments when they had been considered in the other place. I know the importance that your Lordships attach not only to meeting Community directives but also to improving the quality of our drinking water supplies. Let there be no doubt that the Government share that concern. I welcome the fact that in Amendment No. 4A the noble Lord, Lord McIntosh of Haringey, now also concedes that Amendments Nos. 1 to 3 would not have been the right way to achieve those improvements. Since there seems likely to be an agreement about the case for not insisting on Amendments Nos. 1 to 3, I shall say no more about them unless your Lordships would like me to do so, except for one point.
The amendments specify a date for compliance with the Community drinking water directive requirements which is later than that set in the directive. The amendments would therefore conflict with Community law. The legal duty must be to comply now, and that is what the Bill will provide once these amendments are removed.
The noble Lord, Lord McIntosh of Haringey, has shifted his ground and indeed his argument, and is concerned with the progress of our improvement programme. Your Lordships will be glad to hear that we are well advanced in our consideration of the programmes, and I can say that in all important areas we shall be able to comply well before 1993 in England and Wales. For example, the lead programme related to the directive is virtually complete now and the very few remaining areas should be dealt with in the next few months. The same can be said for any remaining microbiological problems at treatment works.
For nitrate there are only about 30 suppliers in the whole country still regularly exceeding the standard and most will comply in the next two or three years. The few remaining areas will require the installation of special denitrification equipment, and we need to be sure that this equipment is quite safe before bringing it into general use. I know that your Lordships would be the first to condemn us, and rightly so, if we did not go to those lengths to check the equipment.
For aluminium regularly exceeding the standard due to aluminium treatment, compliance should also be achieved within two or three years. Other supplies where improvements are needed relate to standards which have nothing to do with health, such as colour and iron, or which are purely precautionary, such as the pesticide standard. In most cases these standards are breached only at irregular intervals. We are still considering the timescale of these programmes.
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I felt that the noble Lord, Lord McIntosh of Haringey, was keen to have another go at Britain as though we were the only country having difficulties in meeting Community directives. Let me remind the House that all member states are having difficulty in implementing the very strict standards in the drinking water directive. The Commission has started legal proceedings against all other member states except Portugal, which does not have to implement the directive until next year. France, Germany, Denmark, Italy and Belgium all have substantial problems with the nitrate standard. Germany and Italy are being proceeded against for not applying the pesticide standard properly. France, Belgium, Germany and Ireland are all alleged not to have fully incorporated the directive into national law. It would be interesting to see what would happen if the Commission had as much information about water supplies in other member states as we have provided in this country.
The noble Lord, Lord McIntosh, referred to two factors in particular; cadmium and HCH. The particular case referred to concerns technical legal aspects of the means of implementation of these directives. There is no allegation—I repeat, no allegation—that Britain is failing to control pollution by these substances. Indeed, we are as assiduous as any other member state in implementing the directives in practice and a good deal more assiduous than most. We undertook some time ago to give formal legal effect to the directives and relevant provisions have been included in Part III of the Water Bill. Regulations will be brought forward shortly so any action now by the Commission would, I submit to your Lordships, be quite redundant.
It was a pity that the noble Lord, Lord Molloy, did not take part in our earlier proceedings. He would have realised that we are not privatising water; we are privatising the water industry. I know that the noble Lord, Lord Ezra, would be happy to tell him of the advantages to the French of having an industry not in the public sector.
I have listened carefully to what has been said by all your Lordships and, despite the honeyed words of the noble Lord, Lord McIntosh of Haringey, I would say that there are difficulties with this amendment. I agree with my noble friend Lord Renton, in saying that we do not think it would be right for the Secretary of State to pick and choose among the 66 parameters in the community directives. As I have said, we are committed to a programme of compliance with all parameters as soon as possible, taking into account all the practicalities. I do not know how the Commission would take—but I would suggest to your Lordships not very kindly—to regulations that restricted investment plans to particular parameters.
The wording refers to substances which carry a significant risk of danger to the health of any person. That would mean going much further than the EC directive in respect of substances such as aluminium to cater for the needs of the very few who need water with no aluminium for kidney dialysis machines or water with no nitrates where some young babies require that in a few cases.

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As my noble friend Lord Trafford said, with his great experience, it is more cost effective to provide special treatment and special supplies in those circumstances, and the cost of what the noble Lord, Lord McIntosh, is proposing is, I would submit to your Lordships, quite disproportionate to the benefits that can be achieved in other ways.
The noble Lord, Lord Addington, raised the difficulty he has with rye in his diet. However, the fact is that the noble Lord can avoid rye in his diet. But I would ask him to think this amendment through. This amendment would require all water supplies to be brought up to the highest standards for any person. Thus, to continue the analogy for the noble Lord, it would mean that because the noble Lord needed to avoid rye in his diet, rye should be excluded from all food sources. That is the effect of what we are considering.
As has been mentioned by my noble friend Lord Boyd-Carpenter, another effect of the amendment is to place responsibility for deciding the timing of privatisation on the European Commission. We cannot determine how long the Commission will take to consider the programmes and respond. Our experience on such matters is not good. It has taken four years to consider the much smaller drinking water programme that we put to them in 1985. I should not like to speculate on how long it will take to consider the proposed compliance programmes but we shall be sending them to the Commission shortly.
From my own experience, I was promised from the Commission in March last year that information would be given within six months; that is, by September last year. I took the opportunity to remind the Commission at the last meeting of the Council of Ministers that we were still waiting for that information.
A further reason for not supporting the new clause is the fact that the provisions already in the Bill adequately cover the subject. Programmes which are currently being discussed with the undertakers will lead to undertakings under Clause 20(5)(b) being submitted during September. Assuming that these are acceptable to the Secretary of State, he will serve a notice on the company saying that he is so satisfied. Under Clause 20(6)(b) he must publish a copy of the notice to bring it to the attention of all those affected by it. He must also serve a copy of the notice and of each undertaking on the director general, who is required to enter the undertakings in the public register. This register will be set up in September.
When we publish notices under Clause 20(6)(b) in September, I can assure your Lordships that information on all programmes will be made available. The nature and time scale of these programmes will be plain to everyone. It therefore surprised me that the noble Lord, Lord Ezra, did not seem to be aware that the prospectus is to be published later in the year and will also contain statements on the extent of the investment programmes, including those to comply with the drinking water directive. I put it to the noble Lord that his genuine concerns are already met by the conditions under the Bill.
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I too read through this amendment, as my noble friends have done, and its clear to me that the main reason for it is to delay flotation. That is something that I hope your Lordships will not support.
Lord McIntosh of Haringey: My Lords, I am grateful to noble Lords who have taken part in this short debate. I am particularly grateful to noble Lords opposite, all of whose contributions have been remarkably helpful to my case. The noble Lord, Lord Boyd-Carpenter, whom I am delighted to see intervening on the Bill—I am sorry that we have not had the pleasure of his interventions before—criticised my reference to the Brussels meeting which he correctly described as a non-meeting. I mentioned the Brussels meeting because the Secretary of State prayed that non-meeting in aid when he persuaded Members in another place that our amendments were not acceptable. If he had not raised the matter, it would have been inappropriate for me to do so, but I question whether there was not, as I said earlier, a risk of another place being misled into thinking that the European Commission was satisfied with the British Government's programme of compliance when that is most certainly not the case.
The noble Lord, Lord Boyd-Carpenter, referred to the investment plan as a discouragement to investors. He was adequately answered by the Minister, who said that the prospectus itself will include statements on investment programmes and on compliance programmes. How can it be a discouragement to investors? The very least that investors must have is a statement of how, in what way, at what expense and in what timescale there will be compliance with the European Community directives. It is not in the interests of investors to run the risk of incurring financial penalties from the European Commission because there is non-compliance with drinking water standards.
Lord Boyd-Carpenter: My Lords, the noble Lord asked me a question and perhaps I can answer it. The great discouragement to investors would be this proposal, with its slow and cumbrous demand for an investment plan, totally different from what would be in the ordinary sensible prospectus either in the private or the public sector. The noble Lord knows that perfectly well.
Lord McIntosh of Haringey: My Lords, the noble Lord is making a distinction without a difference between a plan and a programme, and one which in a prospectus certainly has to be costed and has to include a timescale; otherwise it would be in breach of companies legislation.
The final point made by the noble Lord, Lord Boyd-Carpenter, was even more helpful. He criticised the decline in drinking water standards, as he said, since water was nationalised. It was his Government in 1973 and 1983 who took control of our public sector water from the local authorities and centralised it. If he calls that "nationalising", I am delighted to see his death-bed conversion to the principle which a Conservative Government overturned of local authority control of the water supply.

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The noble Lord, Lord Trafford, was even more helpful. He claimed that our amendment required that we should be specifying on the face of the Bill a price, a date and a timescale. We say no such thing. As the Minister has made very clear, we have said that there should be an investment plan but that it should be confirmed by discussion and consultation with the European Commission and that it should cover only those parameters of European Commission directives which are concerned with health and where there is, in the opinion of the Secretary of State—that is the important thing to remember—a significant risk of danger to the health of any person. That does not mean every person. It does not mean that all water supplied to everybody has to be aluminium or nitrate free, and the Minister knows that as well as the noble Lord, Lord Trafford. But the requirement that the health of the general British public should be protected in accordance with European directives is not a very radical demand. It is not one which the Government might resist in any normal circumstances. They are resisting it at the moment only because they are determined to press ahead with water privatisation at any cost. The cost is to the consumers of water, to the health of the consumers of water and to the information to be provided to investors.
The noble Lord, Lord Renton, seemed to think that the amendment would mean that privatisation would be held up if one consumer complained about one parameter. The amendment does not say that and it cannot be interpreted to mean that. The Minister again has answered that point by saying what will be in the prospectus. The noble Baroness, Lady Blatch, when she was not descending to vulgar abuse, made the great mistake of referring specifically to cadmium. It is exactly cadmium that I referred to when I said that the British Government are not complying with European directives, have not complied with reasoned opinion and are now forcing the European Commission to go to the High Court.
The Minister had the nerve—I congratulate him on it—to repeat the claim that no deadline can be put on the improvement of our drinking water because the law states that we have to comply now. Those are his words. He went on then to say that the Bill states that we shall have to comply now. But we are not going to comply now. Everybody knows that. We shall not be complying now, by 1993 or probably even by 1995. What the Minister is saying is that the law is an ass. We are enacting a Bill which states something that the Government have no intention of complying with. That is what the Bill states and that is what will happen.
The noble Earl seems to think that by doing this we are saying that only Britain has problems with its drinking water quality. No such thing. I have referred to no other country in moving the amendment or at any other stage of the Bill. But it is Britain that we legislate for. That is why our responsibility is to protect the consumers of this country and to ensure that there is a realistic timetable for safeguarding their health by improving
1296
drinking water quality and protecting the investors by ensuring that there is a proper plan for putting things right, complying with the law and enabling the new privatised water companies to start off on a basis which is fair to the investors, fair to their shareholders and above all fair to the British public.
4.28 p.m.
On Question, That this House do not insist on their Amendments Nos. 1 to 3 to which the Commons have disagreed and do agree to the amendment in lieu thereof?
Their Lordships divided: Contents, 114; Not-Contents, 168.

DIVISION NO. 1

CONTENTS

Addington, L.

Leatherland, L.

Airedale, L.

Leicester, Bp.

Alport, L.

Listowel, E.

Amherst, E.

Llewelyn-Davies of Hastoe, B.

Ampthill, L.

Ardwick, L.

Lloyd of Kilgerran, L.

Attlee, E.

Lockwood, B.

Aylestone, L.

Longford, E.

Banks, L.

Lovell-Davis, L.

Beaumont of Whitley, L.

McGregor of Durris, L.

Birk, B.

McIntosh of Haringey, L.

Blease, L.

McNair, L.

Bonham-Carter, L.

Mais, L.

Boston of Faversham, L.

Mayhew, L.

Bottomley, L.

Milner of Leeds, L.

Briginshaw, L.

Mishcon, L.

Broadbridge, L.

Molloy, L.

Bruce of Donington, L.

Monson, L.

Burton of Coventry, B.

Mountevans, L.

Callaghan of Cardiff, L.

Murray of Epping Forest, L.

Campbell of Eskan, L.

Nathan, L.

Carmichael of Kelvingrove, L.

Nicol, B.

Northfield, L.

Carter, L.

Ogmore, L.

Cledwyn of Penrhos, L.

Peston, L.

Cocks of Hartcliffe, L.

Phillips, B.

David, B.

Pitt of Hampstead, L.

Dean of Beswick, L.

Ponsonby of Shulbrede, L. [Teller.]

Denington, B.

Donaldson of Kingsbridge, L.

Rathcreedan, L.

Dormand of Easington, L.

Rea, L.

Elwyn-Jones, L.

Ritchie of Dundee, L.

Ennals, L.

Rochester, L.

Ewart-Biggs, B.

Russell, E.

Ezra, L.

Sainsbury, L.

Falkland, V.

Scanlon, L.

Fisher of Rednal, B.

Seear, B.

Flowers, L.

Sefton of Garston, L.

Foot, L.

Serota, B.

Gallacher, L.

Shackleton, L.

Galpern, L.

Shepherd, L.

Gladwyn, L.

Somers, L.

Graham of Edmonton, L.

Soper, L.

Grimond, L.

Stallard, L.

Hampton, L.

Stedman, B.

Hanworth, V.

Stoddart of Swindon, L.

Harris of Greenwich, L.

Strabolgi, L.

Hatch of Lusby, L.

Tordoff, L. [Teller.]

Henderson of Brompton, L.

Turner of Camden, B.

Henniker, L.

Wallace of Coslany, L.

Houghton of Sowerby, L.

White, B.

Howie of Troon, L.

Wigoder, L.

Ilchester, E.

Williams of Elvel, L.

Jay, L.

Willis, L.

Jeger, B.

Winchilsea and Nottingham, E.

Jenkins of Putney, L.

John-Mackie, L.

Winstanley, L.

Kearton, L.

Winterbottom, L.

Kilmarnock, L.

Young of Dartington, L.

1297

NOT-CONTENTS

Abercorn, D.

Jenkin of Roding, L.

Abinger, L.

Johnston of Rockport, L.

Airey of Abingdon, B.

Joseph, L.

Alexander of Tunis, E.

Kaberry of Adel, L.

Allenby of Megiddo, V.

Kenilworth, L.

Annaly, L.

Killearn, L.

Arran, E.

Kinnaird, L.

Astor, V.

Kitchener, E.

Barber, L.

Knights, L.

Bauer, L.

Lawrence, L.

Belhaven and Stenton, L.

Layton, L.

Beloff, L.

Lloyd of Hampstead, L.

Belstead, L.

Lytton, E.

Bethell, L.

McAlpine of Moffat, L.

Biddulph, L.

Mackay of Clashfern, L.

Birdwood, L.

Macleod of Borve, B.

Blake, L.

Mancroft, L.

Blatch, B.

Manton, L.

Blyth, L.

Margadale, L.

Borthwick, L.

Marley, L.

Boyd-Carpenter, L.

Merrivale, L.

Brabazon of Tara, L.

Mersey, V.

Brougham and Vaux, L.

Monk Bretton, L.

Bruce-Gardyne, L.

Monteagle of Brandon, L.

Caithness, E.

Montgomery of Alamein, V.

Camden, M.

Mottistone, L.

Campbell of Alloway, L.

Mountgarret, V.

Carnock, L.

Moyne, L.

Chelmer, L.

Munster, E.

Chester, Bp.

Murton of Lindisfarne, L.

Cockfield, L.

Nelson, E.

Coleraine, L.

Nelson of Stafford, L.

Colnbrook, L.

Norrie, L.

Colwyn, L.

Nugent of Guildford, L.

Cork and Orrery, E.

O'Brien of Lothbury, L.

Cottesloe, L.

Oppenheim-Barnes, B.

Crickhowell, L.

Orkney, E.

Cullen of Ashbourne, L.

Orr-Ewing, L.

Dacre of Glanton, L.

Oxfuird, V.

Daventry, V.

Pender, L.

Davidson, V. [Teller.]

Peyton of Yeovil, L.

De Freyne, L.

Platt of Writtle, B.

Denham, L. [Teller.]

Plummer of St. Marylebone, L.

Dilhorne, V.

Dundee, E.

Porritt, L.

Eden of Winton, L.

Quinton, L.

Ellenborough, L.

Radnor, E.

Elles, B.

Rankeillour, L.

Elliott of Morpeth, L.

Reay, L.

Elton, L.

Reigate, L.

Erroll of Hale, L.

Reilly, L.

Fanshawe of Richmond, L.

Renton, L.

Ferrers, E.

Renwick, L.

Fisher, L.

Rodney, L.

Fraser of Carmyllie, L.

Romney, E.

Fraser of Kilmorack, L.

Sackville, L.

Gainford, L.

St. John of Fawsley, L.

Gardner of Parkes, B.

Sanderson of Bowden, L.

Glenarthur, L.

Sandys, L.

Grantchester, L.

Seebohm, L.

Gray of Contin, L.

Sempill, Ly.

Greenway, L.

Sharples, B.

Gridley, L.

Shaughnessy, L.

Grimthorpe, L.

Shrewsbury, E.

Hailsham of Saint Marylebone, L.

Skelmersdale, L.

Slim, V.

Halsbury, E.

Stevens of Ludgate, L.

Hanson, L.

Stockton, E.

Hardinge of Penshurst, L.

Strathclyde, L.

Harvington, L.

Strathmore and Kinghorne, E.

Havers, L.

Hemphill, L.

Strathspey, L.

Henley, L.

Suffield, L.

Hesketh, L.

Swinton, E.

Hives, L.

Terrington, L.

Home of the Hirsel, L.

Thomas of Gwydir, L.

Hood, V.

Thomas of Swynnerton, L.

Hooper, B.

Trafford, L.

Hylton-Foster, B.

Trefgarne, L.

Ironside, L.

Trenchard, V.

1298

Trumpington, B.

Wolfson, L.

Ullswater, V.

Wyatt of Weeford, L.

Vaux of Harrowden, L.

Wynford, L.

Waldegrave, E.

Yarborough, E.

Watkinson, V.

Young of Graffham, L.

Wise, L.

Resolved in the negative, and Motion disagreed to accordingly.
4.37 p.m.
The Earl of Caithness: My Lords, I beg to move that the House do not insist on their Amendents Nos. 1 to 3 to which the Commons have disagreed for the Reason numbered 4.
Moved, That the House do not insist on their Amendments Nos. 1 to 3, to which the Commons have disagreed, for the Reason numbered 4.
On Question, Motion agreed to.

LORDS AMENDMENT
5 Schedule 18, page 267, line 13 leave out from "description;" to end of line 15 and insert—
"(ii) the power conferred by virtue of sub-paragraph (1)(bb) above; and
(iii) each of the powers conferred in relation to the powers mentioned in sub-paragraphs (i) and (ii) above by virtue of sub-paragraph (1)(c) above,"
6 The Commons disagreed to this amendment for the following reason:
Because it is inconsistent with the amendments proposed by the Commons in lieu of Lords Amendment No. 239.
The Earl of Caithness: My Lords, I beg to move that the House do not insist on their Amendment No. 5, to which the Commons have disagreed, for the Reason numbered 6. With the leave of the House I should also like to speak to Amendments Nos. 7, 8 and 9.
Schedule 18 sets out the powers under which the authority and water and sewerage undertakers are able to lay pipes and carry out associated works. Water authorities are currently generally able to exercise their pipelaying powers after serving reasonable notice on the owner and occupier of the land. As a result of Amendments Nos. 7 and 9 moved by my noble friend Lord Radnor at Third Reading which were accepted by your Lordships, the authority and undertakers would be required generally to seek the consent of tile owner and occupier of the land before exercising the powers. The power to lay pipes after serving reasonable notice should be limited to cases of emergency, cases where the undertaker is complying with a requisition to provide a main or sewer and cases where the Secretary of State determines that it would be exceptionally difficult to obtain the consent of every owner and occupier concerned.
While there may seem to be a superficial reasonableness about these provisions, the overall effect of these amendments would be severely to inhibit the ability of undertakers to meet effectively the requirements placed on them to provide the water and sewerage services that are essential to public health. That is a matter which we discussed only recently. The amendments would impose extremely cumbersome arrangements on the Secretary of State and undertakers, which would to a

1299
large extent defeat the whole object of the pipelaying powers. Far from merely limiting those powers in a sensible way the provisions would in fact undermine them.
The provisions are particularly unreasonable when considered in the context of our EC obligations. If the operational capabilities of water and sewerage undertakers are constrained in the way proposed by there amendments, there is certain to be a considerable deterioration in the pace at which we can expect to see the improvements we all want in the quality of our drinking water and standards of our bathing beaches.
I know that in retaining the existing powers of water authorities to lay pipes on notice, we would be preserving the unique position of the water industry as the only public utility with such powers. The water industry can, however, properly be regarded in a different context from other utilities. It does not generally have the operational advantages of other utilities; the route of water and sewer pipes is often determined by the need for gravitational flows, a restriction that does not apply elsewhere.
I turn to Amendment No. 8. The purpose of this amendment is to meet the concerns expressed by noble Lords from all sides at Third Reading, about the extent of these powers and the scope they offer for inconsiderate behaviour, in a way which does not jeopardise the ability of water and sewerage undertakers to meet their statutory obligations.
The amendment provides that, when exercising their powers in order to lay new pipes, undertakers would be required to give a minimum of three months' notice. A minimum of 42 days' notice would be required in the case of replacement or repair of existing pipes. The only exceptions to these arrangements would be cases of emergency and the exercise of the powers in response to a requisition to provide a main or sewer or a request to provide a service pipe when the undertaker is required to comply within a statutory time limit. These notice periods are intended to ensure that the examples of the exercise of the powers following an unreasonably short period of notice that concerned noble Lords cannot be repeated.
The amendment also contains a further measure designed to ensure reasonable behaviour by undertakers. Clause 156 provides for the director general to direct an undertaker to make a payment to a complainant if he is satisfied that an undertaker has failed to consult the owner or occupier before or during pipelaying, or by acting unreasonably has caused them to suffer loss or damage or to be inconvenienced. The clause currently specifies that the maximum payment that the director general is able to direct an undertaker to make is £1,000. The amendment provides for this sum to be increased to £5,000. This provision will help to ensure that undertakers act reasonably when exercising their powers.
Finally the amendment provides for the Secretary of State to make regulations to provide for advance payment of compensation in respect of the exercise of these powers. I am happy to repeat the
1300
undertaking given by my honourable friend the Minister for Water and Planning in another place that these regulations will be made in time to come into force on transfer date. They will follow the precedent of Section 52 of the Land Compensation Act 1973 and provide for advance payments of 90 per cent. of the agreed amount of compensation or 90 per cent. of the compensation as estimated by the undertaker. The advance payment will be made not later than three months after such a payment is requested. These provisions will meet the concerns expressed at earlier stages about the time taken to settle compensation following the exercise of these powers.
I am well aware of the concerns of your Lordships about the scope that these powers offer for arbitrary behaviour on the part of undertakers. I know that there have been occasions in the past when landowners have suffered from unreasonable actions. I make no apologies for explaining again the significant steps we have taken to protect the interest of landowners.
First, the Bill provides for the powers to be subject to a statutory code of practice to be submitted by the undertakers to the Secretary of State for approval. The code will cover all aspects of the pipelaying process. In particular it will contain provisions requiring undertakers to provide information to owners and occupiers about the works, to plan the works to cause the minimum inconvenience to landowners and to restore the land, once the work is complete, to its original condition. Undertakers will be required to act in a reasonable way at all times.
The second step we have taken is to provide in Clause 156 for the director general to direct an undertaker to make a payment to the complainant, up to a maximum of £1,000, which we propose should be increased to £5,000, if he is satisfied that an undertaker has failed to consult the owner and occupier before or during pipelaying, or by acting unreasonably has caused them to suffer loss or damage or to be inconvenienced. The director general will take into account whether there has been a breach of the code of practice in determining whether to make a direction and the amount of any payment.
Finally, the new clause after Clause 155, which was introduced by the Government in this Chamber at Committee stage places a requirement on undertakers to alter or remove a pipe in response to a reasonable request from a person with an interest in the land were the pipe is installed, or in adjacent land. This will go a long way to ensuring that the presence of undertakers' pipes on private land does not unreasonably hinder any subsequent development of that land.
I know that in accepting the amendments of my noble friend Lord Radnor at Third Reading your Lordships were greatly concerned about the powers that will be available to the water industry and the scope they offer for inconsiderate behaviour. The provisions contained in Commons Amendment No. 8 will I believe fully meet these concerns. These requirements, combined with the provisions of the code of practice and those in Clause 156 for the

1301
director general to direct an undertaker to make a payment, now up to £5,000, in cases where the undertaker has failed to consult a complainant or has acted unreasonably in exercising the powers, will I believe deal extremely effectively with the legitimate concerns of landowners.
I hope that the House will not insist on Amendments Nos. 5, 7 and 9. I commend to your Lordships Commons Amendment No. 8 in lieu of Amendment No. 7. This will improve the protection afforded to landowners while preserving the powers of undertakers to meet their statutory obligations.
Moved, That this House do not insist on their Amendment No. 5 to which the Commons have disagreed for the Reason numbered 6.
On Question, Motion agreed to.

LORDS AMENDMENT
7 Schedule 18, page 267, line 16, after "only" insert "except in the circumstances specified in sub-paragraph (5) below, after the consent of every owner and occupier of the land where the power is to be exercised has been given, which shall not be unreasonably withheld and any question whether such consent is or is not unreasonably withheld shall be referred to and determined by the Secretary of State; in the circumstances specified in sub-paragraph (5) below".
8 The Commons disagreed to this amendment but proposed the following amendments in lieu:
Page 156, line 26, leave out "£1,000" and insert "£5,000".
Page 267, leave out lines 11 to 20 and insert "only after reasonable notice of the proposed exercise of the power has been given to the owner and to the occupier of the land where the power is to be exercised.
(5) Subject to sub-paragraph (6) below, in relation to any exercise of the powers conferred by this paragraph for the purpose of laying or altering a relevant pipe, the minimum period that is capable of constituting reasonable notice for the purposes of sub-paragraph (4) above shall be deemed—

(a) where the power is exercised for the purpose of laying a relevant pipe otherwise than in substitution for an existing pipe of the same description, to be three months; and

(b) where the power is exercised for the purpose of altering an existing pipe, to be forty-two days.

(6) Sub-paragraph (5) above shall not apply in the case of any notice given within the period of one year beginning with the transfer date or in the case of any notice given with respect to the exercise of any power in an emergency or for the purpose of—

(a) laying or altering a service pipe; or

(b) complying with a duty imposed under section 40 or 70 of this Act."

Page 268, line 38, at end insert—
"( ) The Secretary of State may by regulations make provision requiring the Authority or any water undertaker or sewerage undertaker, where it is proposing or has begun to exercise any power conferred by virtue of paragraph 4 or 5 above in a prescribed case, to make advance payments on account of compensation that will become payable in respect of the exercise of that power.".
The Earl of Caithness: My Lords, I beg to move that the House do not insist on their Amendment No. 7 to which the Commons have disagreed and do agree with the Commons in their three amendments proposed in lieu thereof.
Moved, That this House do not insist on their Amendment No. 7 to which the Commons have disagreed and do agree with the Commons in their
1302
three amendments proposed in lieu thereof.—(The Earl of Caithness.)
4.45 p.m.
The Earl of Radnor: My Lords, I am grateful to my noble friend for describing both the original amendment which your Lordships accepted and also for going into some detail into the amendment which the Commons have put in lieu of it. I am happy to accept the replacement by the Commons. At the same time, I should like to thank my noble friend for seeing me between the last stage of this Bill in this House and now in order to discuss the sort of compromise which we have before us. Having said that, indeed it is a compromise in that still in my heart of hearts I believe that the original amendment was tidy, concise and covered all the matters which were worrying my noble friend.
However, as he has described it, the situation is a great deal better than it was in the original Bill for the various reasons my noble friend described. To begin with there is this restrospective penalty of £5,000 instead of £1,000. That must be considered an advantage, although in a way it is quite outside the original thrust of the amendment which I put forward together with other noble Lords.
Much more important to me is that "reasonable notice" has been defined as three months for a new pipe and 42 days for the relaying of a pipe. I believe that, together with the exceptions of emergency service pipes and Clauses 40 and 70, it must be considered at least an advance because it will mean that people will not be abused in quite the same way as has happened since 1974 when "reasonable notice" could be defined by the courts as whatever they felt was correct. Noble Lords will remember from the debate that this could be as little as one month and two days.
An important point is that, by regulation, money can be paid in advance. That is of considerable importance because the parties must come together for this to happen and all kinds of matters must be discussed. Once more those ugly situations where things happen too quickly and with too little consultation may be overcome. Perhaps my disappointment is that the matter is left to regulations and is not on the face of the Bill.
I think that I have covered the matter. Compromise is sometimes quite a good way of going about things. Although I said earlier that I prefer my own amendment, I am happy to accept this amendment as it stands. I am grateful to my noble friend.
The Earl of Caithness: My Lords, I am grateful to my noble friend for what he has said. I appreciate that he would have liked his amendment to stay intact. Any noble Lord who had succeeded in the way that my noble friend has would not have felt any differently. I hope that the House will agree that we have been able to meet my noble friend a great part of the way, although perhaps not as far as he would have liked. We have made every effort to meet him on the points that he raised and we have

1303
also, as he so generously said, broadened the scope of the amendment. We increased the penalty.
On Question, Motion agreed to.

LORDS AMENDMENT
9 Schedule 18, page 267, line 20, at end insert—
"(5) The circumstances in which powers shall be exercised only after reasonable notice as provided in sub-paragraph (4)(a) above are—

(a) in an emergency; or

(b) when a pipe is laid in order to comply with a requisition under this Act; or

(c) where the Secretary of State determines it would be exceptionally difficult to obtain within a reasonable time the consent of every owner and occupier of the land where the power is to be exercised and so certifies.".

10 The Commons disagree to this amendment for the following reason:
Because it is consequential on Lords Amendment 239 in respect of which the Commons have proposed amendments in lieu.
The Earl of Caithness: My Lords, I beg to move that the House do not insist on their Amendment No. 9 to which the Commons have disagreed for the Reason numbered 10.
Moved, That this House do not insist on their Amendment No. 9 to which the Commons have disagreed for the Reason numbered 10.—(The Earl of Caithness.)
On Question, Motion agreed to.

Electricity Bill
4.53 p.m.
The Parliamentary Under-Secretary of State, Department of Energy (Baroness Hooper): My Lords, I beg to move that the Bill be now further considered on Report.
Moved, That the Bill be further considered on Report.—(Baroness Hooper.)
On Question, Motion agreed to.
Clause 34 [Electricity from non-fossil fuel sources]:
Lord Shepherd Lord Shepherd moved Amendment No. 76:
Page 26, line 9, at end insert—
("(4A) The Director may specify from time to time in the case of any person authorised to generate electricity under section 7(1)(a) above a proportion of his total generation that shall be from non-fossil fuel sources other than nuclear generation.
(4B) In exercising his functions under subsection (4A) above the Director shall have regard to the availability of different methods of generation and levels of use of energy from non-fossil fuel sources other than nuclear generation which may be appropriate to persons to whom subsection (4A) above applies.").
The noble Lord said: My Lords, this amendment is concerned with what we in this country refer to as renewable sources of energy and the Community refers to as alternatives. They range widely from wind turbine power to biomass, geothermal heat, solar and many others. Many of them are still at the
1304
early technological stage. A great deal of work has been done. Some are now in production. One is delighted to see that the Central Electricity Generating Board is now seeking to prove the feasibility of wind power with its wind farm of some 25 turbines. Denmark has gone a good deal further. There is no question that the Government have shown their interest in this field although, as Sub-committee B reported, we should have liked more funds to be available for research and development. I suppose that that is the story of all those who are interested in research and development.
In her Second Reading speech the noble Baroness said that it was the Government's intention to move an amendment to provide tranches within what was called the non-fossil fuel allocation for the generation of electricity taken by what are now the area boards. I have read with care what the noble Baroness said. I am only sorry that I was not present for her speech. My first criticism of the government amendment was that while the importance of this matter was recognised what was said was obscure. When I first saw the part of the Bill concerned with non-fossil fuel I though of nuclear. However, it is clear that that is not so. What the Government put forward to honour their agreement and undertaking to provide these tranches is to be found in the amendment which the noble Baroness proposed.
There are some difficulties with the government amendment as it now lies in the Bill. I am still unclear what is a non-fossil fuel generating station. In Clause 34(8) a non-fossil fuel generating station is described as,
"a generating station which is (or may be) fuelled or driven otherwise than by a fossil fuel".
I am not quite sure how the noble Baroness's amendments fall naturally within that definition. It is important to make clear that the renewable tranche is separate from non-fossil fuel; that is, without the nuclear element. That was one of the purposes of the amendment. I agree with the noble Baroness that it is difficult to describe renewables, although I must say to my noble friend Lord Peston that in Amendment No. 24 a side bracket referred to the "new techniques". I thought that the new techniques related to renewables but it may be an all-embracing term. That is why I was pleased to see Amendment No. 24. It seemed that the Government were undertaking their commitment to maintain research and development in alternative energy sources.
My difficulty goes a little further when I come to subsection (9). It says:
"subsections (5) to (8) above shall have effect in relation to any non-fossil fuel generating station which is driven by water, wind or solar power".
The noble Baroness will agree that that places a limitation on the renewables. There is geothermal, in respect of which the Government have most recently, and I think very wisely, given fairly substantial sums to the Institute of Mining. Biomass was referred to by the noble Baroness. I do not think it is covered in that definition, if that definition is what the Government have in mind for non-fossil fuel generating stations.
I believe that biomass has an area of development particularly in the field of small towns, and maybe also in city power supplies. I find myself in a difficult situation as to whether the Government have got it right in the way that they propose to honour their undertakings which they gave quite voluntarily concerning renewables. I ask the noble Baroness to look at subsection (9)(b), which states,
"that electricity generated outside the United Kingdom shall be treated for the purposes of subsection (5)(a) above as generated by a non-fossil fuel generating station in such circumstances and to such extent as may be prescribed".
I may be something of an innocent and I am certainly not a lawyer. I was wondering whether what is to be supplied from France has to be clearly identified by some generating station which is using renewable or alternative energy sources. At the moment that appears to be rather obscure.
The Government have gone a good way in trying to meet the concerns of Sub-committee B and many others involved in the field of the use of renewables and the easement of the greenhouse effect. Perhaps it is just as important to reduce the reliance on the imports of oil. I believe that the Government have gone a good way as regards those matter. But could they not have done so in a better way, one that would have shown the importance of this particular industry? If the noble Baroness appreciates that, I shall be happy to withdraw this amendment. It is a new industry and there is in it a great deal of enthusiasm and potential. If this subject were more closely identified within the Bill, as opposed to being part of the obscure nature of the way in which the parliamentary draftsman has provided it for the Minister, that would be welcome.
I believe it was my noble friend Lord Peston who raised the question of the change being made by order. Whether it is done by an order or through the framework of the amendment that I and other noble Lords have tabled, there may be some similarity. The amendment that I am moving will at least give the impetus that the provision would not be lost in the morass of a very large Bill. Such an order would create a degree of priority in the minds of those who advise Ministers when they are making up their strategic policies. Above all else, it would remind them of their commitment to the community which they have undertaken as regards the reduction of the reliance on imported oil. I do not believe there is anything between myself and the Minister as to what the Government have in mind here. It is the complexity and obscurity of it which I believe is unnecessary, and I do not believe it is right in what I call the public interest. I beg to move.
5 p.m.
Lord Ezra: My Lords, as a member of Sub-committee B and having had the honour to serve under the noble Lord, Lord Shepherd, I support his amendments. I do so because we spent a great deal of time on the whole question of renewable sources of energy. It is quite clear that these sources of energy, which have considerable environmental benefit, are at a relatively early stage of development. If they are to be developed further they need
1306
encouragement. This Bill provides the opportunity to give such encouragement.
However, as the noble Lord, Lord Shepherd, has said, the encouragement is given in a way that is not obvious to the normal reader of the Bill. Combined heat and power, of which I am a great supporter, has many environmental benefits. Yesterday I had occasion to make virtually the same point. On everything that she has said about combined heat and power, the noble Baroness has shown that she is substantially in support of it as a form of energy with its big environmental advantages. The Government are in support of it. Nevertheless, it is very difficult to discern that support in the wording of the Bill as it now stands. Not only has the parliamentary draftsman disguised the fact that any reference is being made to combined heat and power—though we are told that the wording used in the Government's amendment means that—it is put in a way that suggests that the Government are much less supportive than they really are.
I believe that this is an opportunity for the noble Baroness to accept this amendment or to propose something similar in order to indicate clearly to us all that the Government favour the non-fossil fuel element other than nuclear (which is known as the renewable element), and that they consider that it should be encouraged. As I understand it, the Government intend to continue to support with financial contributions research into the development of these forms of energy. The Government consider that they are desirable. We should have it clearly stated in the Bill that that is the Government's position. Therefore I very much support the points made by the noble Lord, Lord Shepherd.
Lord Gray of Contin: My Lords, I do not wish to take issue with the principles that have been spelt out by either the noble Lord, Lord Shepherd, or the noble Lord, Lord Ezra, because I believe we all agree that support for alternative sources of energy is very important and that in the future they will have a vital part to play. We must get the situation into perspective. My understanding is that the total contribution of all alternative sources of energy to power generation at the present moment is somewhere in the region of 8 per cent. That is a very small percentage indeed. With all the best endeavours it is going to be many years before that percentage is increased substantially.
We spend a great deal of our time in this House looking at Bills and revising them, trying to ensure that we do not write into them that which is not absolutely necessary. I do not altogether agree with the noble Lords, Lord Shepherd, and Lord Ezra, when they suggest that in order to emphasise the importance of alternative sources of energy it is necessary to introduce this amendment into the Bill. I suggest to my noble friend who will reply that she thinks very carefully as to whether or not it is desirable to accept this amendment. I personally believe it is unnecessary.
When the generators come to consider the sources of generation that they are going to use, there will be the sources which are available to them at the

1307
present time. When the time comes for those to be extended and expanded, the generators will make their decisions in due course according to availability. The second part of the noble Lords' amendment; namely, subsection (4B), spells out how they should proceed. There will be plenty of time for consideration to be given to the matter. That consideration will take place in any case if those alternative sources provide an adequate and attractive source of supply. While I am not taking issue with what the noble Lord, Lord Shepherd, said, I believe it is unnecessary to write such an amendment into the Bill.
Lord Hatch of Lusby: My Lords, I should like to take up the point made by the noble Lord, Lord Gray of Contin, and contradict it. In doing so I should like to support the noble Lords, Lord Ezra and Lord Shepherd, in their introduction, but I would go further than either of them. I want the Minister to come clean and direct on this matter. As she knows, I have been raising it every since consideration of the Bill began.
First, with regard to what the noble Lord, Lord Gray of Contin, said, it is simply not the case that renewable sources of energy are going to take a long time to be put into effect, particularly if combined with conservation. Certainly they will take a much shorter time to come into effect than would the building of nuclear power stations, which takes six years at a minimum.
I should like to put this straight to the noble Baroness. The Government have been pussy-footing around ever since the issue of renewable energy sources and conservation was introduced. They have been making noises about the necessity for diversification and for giving some support to the research and development of alternative sources of energy. But the issue is clear. The Government and the nuclear industry have been using the taxpayers' money for a large number of advertisements, maintaining that the answer to the greenhouse effect is to increase nuclear energy. It is not. I am not the only one who is saying that. Yesterday over 100 British scientists, including two Nobel lawyers, put their names to this very issue: that it is not the case that the greenhouse effect can be reduced by the use of nuclear energy. The greenhouse effect will be worsened by an increase in nuclear power because the resources that are put into nuclear power will divert resources and attention from the real attack on the greenhouse effect. The real attack must come from energy conservation and from renewable sources, but both cannot operate at the same time.
Unless the Government are prepared to recognise what we are saying to them and what many British scientists are saying, and what was said to the Prime Minister in No. 10 Downing Street six weeks ago, there is no question but that the greenhouse effect will continue to endanger our planet. Renewable sources and conservation can be introduced much more quickly than can the building of new nuclear power stations. Unless the Government are prepared to look at the case for scrapping their plans for the building of four new PWRs and diverting those
1308
resources to the real attack on the greenhouse effect, they are not seriously taking into account what is now becoming widely known as the greenhouse menace to our society. I have told the noble Baroness several times during the passage of the Bill that it is now established that conservation and renewable sources are seven times as efficient as nuclear energy.
I would add one further point which I raised during the Committee stage, though I did not come back on it because I did not have the actual evidence to hand. When I asked the noble Baroness whether she was taking into account the health effects and the health costs of nuclear energy, in addition to the whole paraphernalia of the disposal of waste and that threat, and mentioned the connection between leukaemia and nuclear installations, two Members of the House said that there was no connection, and the noble Baroness agreed with them. Has she read the Black Report of 1984 concerning Sellafield? Has she read the study of the Scottish health services in relation to Dounreay? Has she read about the research going on today about the likely effect?
All I said to the noble Baroness was that it was quite apparent today that there may be a connection between the two, and a great deal more research is needed on this issue. The cost of that research is a cost as against the nuclear industry. It is not sufficient to say, as she has done before, "We are going to diversify; we are going to give consideration to renewable sources and to conservation". I want her to say quite bluntly whether the Government seriously consider that the building of new nuclear power stations may increase the greenhouse effect and be a danger to the health of our society, and whether they will at least consider what they are being told by so many scientists, that by putting their resources into the building of new nuclear power stations they are reducing the opportunity for tackling the causes of the greenhouse effect.
I hope that the noble Baroness will answer that argument this afternoon and tell the House whether the Government have sufficient openness of mind to listen to the scientists. I am not asking her to make up her mind this afternoon but to listen to the scientists and to consider whether this is not a case which should at least be referred to an expert committee as to how the future energy policy of this country should be run. In my view it should be by cancelling the four PWRs, running down the other nuclear power stations and mobilising all the resources available, including those that are now going into nuclear energy, into conservation and into renewable sources.
5.15 p.m.
Lord Kearton: My Lords, I should like to speak to the amendment to which I have put my name. As a member of Sub-Committee B I should like to support the amendment of the noble Lord, Lord Shepherd, which he moved so eloquently and, if I may say so, so reasonably—so reasonably in fact that I cannot imagine that any responsible Minister could possibly disagree with the case that he put.
As the noble Lord said, exactly what is required must be made clear. Sub-Committee B took a lot of evidence; it was converted in some cases, and its

1309
mind was made up at the end that the course suggested by the noble Lord was the sensible one to take.
I should like to commend the Government and the Minister for the way in which they have responded so constructively to many of the comments and suggestions made during the course of this complicated Bill. We are putting a great deal of onus in the Bill on the director. I do not have the privilege of knowing the director but I know the young lady who has recently been appointed as the deputy director. I can only say that it is an inspired appointment and I congratulate the Minister on it.
The director and the deputy director are going to have a monumental task, which in some ways will be greater than that already carried out by the Department of Energy. Anything which we can do to make their task simpler, more direct and more closely specified would be a great advantage. That is the purpose of the noble Lord's amendment.
The case made by the noble Lord, Lord Gray of Contin, reinforces the case for the amendment, because non-fossil fuel sources are relatively small at the moment and they require very active and positive encouragement to make the contribution which they can make in the future. I hope that the Minister will find it possible to accept the amendment.
Viscount Hanworth: My Lords, I do not wish to take up too much of the time of the House, but I think that one really must reply to some extent to the remarks of the noble Lord, Lord Hatch. We agree on one point, and one point only; namely, that the way forward, avoiding the greenhouse effect, is undoubtedly energy conservation. There is nothing on the scene at present as regards alternative energy, however hard we try—apart from tidal power which could have an effect and wind power which would have a small effect—that would get us out of this difficulty. We are therefore left with nuclear and coal.
No one in their senses would say that going nuclear to the maximum possible extent will completely solve the greenhouse effect. However, to argue against nuclear on the grounds that people will be deterred from continuing research into alternative forms of energy is just fairyland.
The last comment I should like to make concerns another point made by the noble Lord, Lord Hatch about health grounds and nuclear. We know the dangers of nuclear. But, my gosh, what has been happening as regards coal—I shall not go into detail, because I do not wish to keep the House too long—it is far greater than anything, Chernobyl included, which has happened or is likely to happen from nuclear.
Baroness Hooper: My Lords, I am happy to give the House the assurance that the Government certainly believe that renewables have a significant contribution to make to diversity in generation. Moreover, that will be increasingly true in the future as many of the developing renewable technologies
1310
are able to prove themselves as attractive options. That is exactly why we are creating the possibility for renewable tranches within the non-fossil fuel obligation which I announced on 15th June.
In doing so I referred to the fact that, as originally drafted, the Bill allowed the order to specify that the capacity should be only from non-fossil stations. In order to make it absolutely clear we introduced the amendment which allows the alternative of specifying that it must be from non-fossil stations of a particular description. The Secretary of State will therefore be able to set orders specifying that they can only be met by capacity from renewable generators. In fact, it will be made clear in the orders that additional tranches will apply to non-nuclear, non-fossil sources. The provision in the Bill is, after all, an enabling provision.
Renewable projects will of course be able to contribute to the initial obligation in any event through contracts signed before the end of this year. That will cover existing capacity and capacity which is on the point of production. The Secretary of State will be setting the obligation with that very much in mind to encourage the distribution companies to contract for all practical and economic propositions that are available. We fully expect a number of competitive projects to be in position to contract by then. Those projects will be included in that initial overall obligation.
We believe that the additional renewable tranches which will be introduced through the. 1990s, and to which I referred in Committee on 15th June, will provide a considerable boost to the prospects for increased generation of renewable forms of energy in the United Kingdom. They will provide a guaranteed premium market into which renewables can sell as soon as they become competitive.
The system will have the added benefit of flexibility. Before setting the size of each tranche, we will consider the progress which the developing technologies have made and the lead times necessary to build new stations. If any particular renewable technology becomes competitive earlier than seems likely at present, we will, of course, be able to review the size of the relevant tranche.
The important thing is that in doing this we must be careful in fixing the level, since the obligation rests upon the suppliers who cannot be expected to cope with any unreasonable obligation. They run the risk, among other matters, of criminal proceedings if they do not fulfil their obligations. Therefore we feel that to look carefully at the level of the obligation is important. That is why the flexibility has been left as it stands.
Further, as I said before, the figure set is a minimum one and there is nothing to prevent suppliers going higher. We believe—and here I must agree with my noble friend Lord Gray of Contin—that this amendment is unnecessary. I say that because the Bill as currently drafted meets the aims of the amendment, as the noble Lord, Lord Shepherd, explained it. The non-fossil fuel obligation is designed to meet the vital strategic need for diversity in generation. This is a matter of national policy and therefore we also believe that it is rightly a matter for the Secretary of State to decide.

1311
The director has a more limited role in this respect. His work and that of his team will be guided by the duties set down in the legislation. It would therefore not be appropriate for the director to have the power to set that obligation. I must say that I am happy about the welcome to the appointments given by the noble Lord, Lord Kearton. We agree, of course, that the director will have a considerable knowledge of the industry which will be very valuable in assessing at what level the non-fossil obligations should be set. That is why the obligation can be set only after the Secretary of State has consulted the director. Moreover, he will also be consulting the public electricity supply companies.
It will also be to the director that the public electricity supply companies have to present the evidence to show that they have met their obligations under Clause 34. Therefore he will be involved in the procedure. We believe that the Secretary of State has all the resources of the Civil Service to assess this, as well as an extensive research and development and demonstration programme. He also has an excellent network of contacts within the industry by which to judge what the potential is. Clearly only one person should be responsible for deciding the proper level for renewables. Further, given the importance that we all recognise renewables have in the longer term, we feel that it is appropriate that that person should be the Secretary of State. I hope that noble Lords will feel able to agree with that conclusion.
The noble Lord, Lord Shepherd, asked whether renewables cover geothermal or biomass. The answer is that renewables do cover these energy sources. They will be able to contribute towards the initial obligation and the future exclusively renewable tranches. Clause 34(9)(a) is designed purely to ensure that the intermittent renewable resources—that is why they are specifically referred to—are given a fair capacity rating. However, geothermal and biomass are not intermittent and can be relied upon to generate when needed.
The noble Lord, Lord Shepherd, also asked about imports having to be related specifically to capacity from non-fossil stations. It is precisely because it is not possible to specify what the contracts for imports should say that Clause 34(9)(b) is needed. Regulations will ensure that imports are treated fairly and in line with domestic electricity.
5.30 p.m.
Lord Shepherd: My Lords, does that mean that the imported electricity, to be covered by the provision for renewables, will have to be identified by renewable generation plants, shall we say, in France?
Baroness Hooper: My Lords, yes. To contribute to the obligation it will have to be positively identified as from a non-fossil or renewable source within the non-fossil obligation.
We all know the view held by the noble Lord, Lord Hatch, about nuclear power. I always aim to give straight answers. I rather resent the implication of his remarks in that respect. His return to the subject of health risk is unwarranted after the
1312
comments that were made when he raised the issue on a previous occasion. There is no way that the risk he suggests exists has been established. We see no one solution to the greenhouse effect. A package is needed, which we believe we are providing with the various measures in the Bill, which will allow for a variety of sources of energy, in addition to energy efficiency measures. The Government believe that the nuclear programme is part of that package. I believe that I have made that clear and given straight answers on a number of occasions.
With regard to the noble Lord's solution to the future of nuclear power, I point to recommendation 4.1 of the House of Lords Select Committee on Science and Technology which endorsed the Government's views and policy in that respect.
The Government are at one with the noble Lord who tabled the amendment in attaching great importance to renewables and, in particular, to their long-term contribution to diversity. However, we believe, as I hope I have sufficiently explained, that the provisions in the Bill achieve that aim and that the amendment would add nothing. I therefore trust that the noble Lord will feel able to withdraw the amendment.
Lord Shepherd: My Lords, I am grateful to those who have taken part in the debate, especially the noble Lord, Lord Ezra, and my noble friend Lord Kearton. I am sorry that the noble Earl, Lord Lauderdale, is not present, because we were together when we successfully moved the amendment which is now Clause 3. We were then described in one responsible newspaper as a group of rebel Tories. I do not know about the noble Lord, Lord Ezra, or my noble friend Lord Kearton, but some of my friends may have said, because of my Right wing views, that I may be close to being a Tory, but they have not yet described me as a rebel.
There is one thing that the Minister can bear in mind—of course the noble Lord, Lord Gray of Contin, does not have the slightest hope of ever being a rebel. It must have been the years that he spent in the Whips Office in another place. I am pleased that the Minister corrected him in respect of his intervention which was clearly in support of the Government. Alternative energy sources, or renewables as we call them in this country, play a significant part, and will increasingly do so in the coming years.
I listened carefully to what the Minister said. With due respect, I do not believe that she added much to what she said in Committee. She did not meet the point to which most of us on this side of the House attach importance, which is to draw attention within the Bill to the importance of what the Government propose and the powers that they intend to take, and whether it was possible to redraft what the Government have in mind so that that is made much clearer.
When they looked at the Bill a number of my noble friends could not find renewables. I would have been in my place when the Minister moved the amendment if I had known that it was about renewables. I have an interest in renewables and

1313
energy, but if that is my reaction and the reaction of others, is the reaction of the general public and the industry likely to be very different?
I find it, in a sense, rather distasteful, because there is nothing between the Minister and myself in intention, purpose and expectation, but I do not believe that she has met the point central to what we have been discussing today—the importance of alternatives or renewables and the need for that to appear on the face of the Bill with infinitely greater clarity than it now does. Therefore I should like to test the opinion of the House in regard to the amendment. The amendments which I have tabled in no way conflict with the purposes or intentions of the Government.
5.36 p.m.
On Question, Whether the said amendment (No. 76) shall be agreed to?
Their House divided: Contents, 81; Not-Contents, 110.

DIVISION NO. 2

CONTENTS

Addington, L.

Llewelyn-Davies of Hastoe, B.

Airedale, L.

Alport, L.

Lloyd of Kilgerran, L.

Amherst, E.

Lockwood, B.

Ardwick, L.

Longford, E.

Aylestone, L.

Lovell-Davis, L.

Banks, L.

Lytton, E.

Blackstone, B.

McIntosh of Haringey, L.

Boston of Faversham, L.

McNair, L.

Bottomley, L.

Milner of Leeds, L.

Briginshaw, L.

Molloy, L.

Broadbridge, L.

Monson, L.

Caldecote, V.

Mountevans, L.

Campbell of Eskan, L.

Mulley, L.

Cledwyn of Penrhos, L.

Nicol, B.

Cocks of Hartcliffe, L.

Northfield, L.

David, B.

Peston, L.

Dean of Beswick, L.

Phillips, B.

Dormand of Easington, L.

Pitt of Hampstead, L.

Elwyn-Jones, L.

Ponsonby of Shulbrede, L. [Teller.]

Ennals, L.

Ewart-Biggs, B.

Prys-Davies, L.

Ezra, L. [Teller.]

Ritchie of Dundee, L.

Fisher of Rednal, B.

Rochester, L.

Fitt, L.

Russell, E.

Foot, L.

Russell of Liverpool, L.

Gallacher, L.

Scanlon, L.

Galpern, L.

Sefton of Garston, L.

Graham of Edmonton, L.

Serota, B.

Gregson, L.

Shepherd, L.

Grey, E.

Sherfield, L.

Halsbury, E.

Stoddart of Swindon, L.

Hanworth, V.

Tordoff, L.

Hatch of Lusby, L.

Turner of Camden, B.

Houghton of Sowerby, L.

Wallace of Coslany, L.

Howie of Troon, L.

White, B.

Jay, L.

Williams of Elvel, L.

Jeger, B.

Willis, L.

John-Mackie, L.

Winchilsea and Nottingham, E.

Kearton, L.

Lawrence, L.

Winterbottom, L.

Listowel, E.

Young of Dartington, L.

NOT-CONTENTS

Abinger, L.

Arran, E.

Alexander of Tunis, E.

Auckland, L.

Alexander of Weedon, L.

Bauer, L.

Allenby of Megiddo, V.

Belhaven and Stenton, L.

1314

Beloff, L.

Manton, L.

Belstead, L.

Margadale, L.

Biddulph, L.

Marley, L.

Birdwood, L.

Merrivale, L.

Blatch, B.

Mersey, V.

Borthwick, L.

Monk Bretton, L.

Boyd-Carpenter, L.

Monteagle of Brandon, L.

Brabazon of Tara, L.

Montgomery of Alamein, V

Brougham and Vaux, L.

Mottistone, L.

Bruce-Gardyne, L.

Munster, E.

Caithness, E.

Murton of Lindisfarne, L.

Camden, M.

Nelson of Stafford, L.

Campbell of Alloway, L.

Norrie, L.

Carnock, L.

Nugent of Guildford, L.

Chelmer, L.

Oppenheim-Barnes, B.

Colnbrook, L.

Orkney, E,

Cork and Orrery, E.

Orr-Ewing, L.

Cottesloe, L.

Oxfuird, V.

Craigavon, V.

Pender, L.

Cullen of Ashbourne, L.

Peyton of Yeovil, L.

Dacre of Glanton, L.

Platt of Writtle, B.

Daventry, V.

Prior, L.

Davidson, V. [Teller.]

Pym, L.

Denham, L. [Teller.]

Quinton, L.

Dundee, E.

Radnor, E.

Dunrossil, V.

Rankeillour, L.

Eden of Winton, L.

Reigate, L.

Elles, B.

Renton, L.

Elliott of Morpeth, L.

Rodney, L.

Fisher, L.

Romney, E.

Fraser of Kilmorack, L.

Saint Albans, D.

Gardner of Parkes, B.

Sanderson of Bowden, L.

Glenarthur, L.

Skelmersdale, L.

Gray of Contin, L.

Stevens of Ludgate, L.

Gridley, L.

Stockton, E.

Hailsham of Saint Marylebone, L.

Strathclyde, L.

Strathspey, L.

Hardinge of Penshurst, L.

Suffield, L.

Hemphill, L.

Swansea, L.

Henley, L.

Swinton, E.

Hesketh, L.

Thomas of Gwydir, L.

Hives, L.

Thomas of Swynnerton, L.

Home of the Hirsel, L.

Trafford, L.

Hood, V.

Trefgarne, L.

Hooper, B.

Trenchard, V.

Jenkin of Roding, L.

Trumpington, B.

Killearn, L.

Ullswater, V.

Kitchener, E.

Vaux of Harrowden, L.

Layton, L.

Waldegrave, E.

Lloyd of Hampstead, L.

Watkinson, V.

Mackay of Clashfern, L.

Young of Graffham, L.

Macleod of Borve, B.

Resolved in the negative, and amendment disagreed to accordingly.
5.44 p.m.
Lord Williams of Elvel Lord Williams of Elvel moved Amendment No. 77:
Page 26, line 26, at end insert—
("(6A) The aggregate amount of the non-fossil fuel generating capacity which shall be specified by the Secretary of State shall be the minimum which is required to ensure the security of electricity supply to electricity consumers. The Secretary of State shall, in specifying the aggregate amount, demonstrate that no other means exist for ensuring the security of supply to electricity consumers which are more economic and less distorting of competition.").
The noble Lord said: My Lords, I beg to move this amendment standing in my name and that of my noble friend Lord Peston. A similar amendment was tabled at Committee stage in which the aim was to eliminate the non-fossil fuel quota and ensure security of supply by other means. In the event, there was no discussion of any significance on that subject, but on Report we believe that it is right to try to approach the problem slightly differently. This time

1315
our amendment addresses itself to the level at which the NFFQ—if I may use that rather ugly series of initials—is to be allowed to ensure security of supply and no higher than that.
In the amendment we attempt to link the non-fossil fuel quota to security of supply, but there is a caveat that the Secretary of State has to demonstrate that there is no other way in which to achieve that security which is cheaper or less distorting of competition. As I understand it, the amendment achieves what the Government wants—in other words security of supply. But it imposes certain limitations on the non-fossil fuel quota in order to make quite certain that the Secretary of State shall pay attention to all other means of conserving and saving electricity while being bound to the provisions on security of supply. I beg to move.
Viscount Hood: My Lords, I think that the amendment is unnecessary and complicated. It relates the fossil fuel capacity to the security of supply, but the security of supply will be met by numerous forms of generation—notably coal—for the foreseeable future. Moreover, the amount required for security is a matter of opinion. In the past, although it has been estimated to the best of our ability, the estimates have not been very accurate. My noble friend Lord Nelson may recall the period in the 1950s when it was decided to build two nuclear stations a year. The estimations were wrong. That was reduced to one; and then it was reduced to none, to the great inconvenience of the plant manufacturers.
I also think that a very strict relationship to the economic factors is unwise. It could well be that a private company might be prepared, if necessary, to put up a wind station, although the Secretary of State could not possibly demonstrate at that time that it was most economic. It might be most economic to import marginal power from France. On all those grounds, I think that the amendment is unnecessary and should be resisted.
Baroness Hooper: My Lords, we believe that the amendment challenges the Government's policy of maintaining security of supply and is therefore unacceptable for reasons which I hope to be able to demonstrate.
I remind your Lordships that over the last two decades the energy market has been marked by considerable turbulence. There were the very rapid oil price rises of 1973 which so nearly led to petrol rationing, and again in 1978. Then there was the miners' strike in 1984. These are experiences which should not quickly or lightly be forgotten. It is quite often the role of this House to remind the Government of the lessons which history and experience have to teach; but on this occasion I think that the lessons have quite clearly already been learnt.
With that in mind, I should like to look first at the second part of the amendment before us. It states that the Secretary of State will have to demonstrate, when he sets the non-fossil fuel obligation, that there
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was no other means of protecting security of supply which would be more economic or less distorting to competition. I entirely agree with my noble friend Lord Hood. How can the Secretary of State possibly know? How could anyone have predicted in advance the cost which the miners' strike imposed on this country? How could anyone have predicted the economic effect which the quadrupling of oil prices had on the British economy?
With the greatest of respect to the profession of the noble Lord, Lord Peston—who is unfortunately not in his seat at the moment—I am afraid that these decisions are, by their nature, beyond the realms in which economics can do more than inform the debate rather than decide it. No doubt it could be said that economists can carry out sensitivity analyses based on different scenarios. But how do we know which scenarios to take and what probability to ascribe to each one?
At the beginning of the 1970s economists suggested that a quadrupling of the oil price and a year-long miners' strike were unlikely outcomes and yet that is what happened within 15 years. It is precisely because we are in the realm of such uncertainty that we need the insurance which we believe the non-fossil fuel obligation offers. I am afraid that decisions of this nature are bound to be broad strategic decisions. It will not be possible to demonstrate down to the last penny that the same security of supply could not have been achieved more cheaply.
As regards the distortion of competition, that is even more difficult to quantify. This will, of course, be a factor which the Secretary of State will consider when he makes a judgment about the level of the obligation. However, it would be quite wrong to constrain his decision in the way this amendment suggests. I do not feel I need to go into the questions of to whom the Secretary of State must demonstrate this, by what method, or what would happen if the two criteria mentioned in the amendment were in conflict.
The first part of the amendment tries to prevent the Secretary of State setting an obligation which is higher than the minimum required for security of supply. That, too, is quite unacceptable. As we have just discussed, there is the possibility of extra tranches to the non-fossil fuel obligation as the 1990s progress. These extra tranches will be exclusively for renewables. As I made clear when I originally announced them, and earlier this afternoon, the Government believe that renewables have a significant contribution to make to diversity in generation in the longer term. However, it would be difficult to argue that these extra tranches, which we estimate will total 600 megawatts, are part of the minimum required to secure security of supply at the moment.
The amendment would quite probably make it impossible for the Secretary of State to set these extra tranches, which we believe would give a considerable boost to the commercial prospects for renewables. I am sure that that is not what the noble Lord, Lord Williams, has in mind. More broadly though, this part of the amendment seems to suggest that the

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Secretary of State will want to use the non-fossil obligation for some purpose other than achieving security of supply through having diversity in generation. That is not the case. As Ministers have repeatedly pointed out, we intend to set the obligation so that it maintains roughly the level of diversity which we have at the moment. I hope, on the basis of what I have said, that the noble Lord will feel able to withdraw his amendment.
Lord Williams of Elvel: My Lords, I am grateful to the noble Baroness. The question of who shall make what estimates of demand in order to ensure security of supply is one which has vexed governments and the Electricity Council over the years. Nevertheless, they have to be made. One cannot simply shrug them off and say they do not have to be made. So there must be some clear estimate. Indeed the Electricity Council has in the past made estimates which, as it turned out, were way above the total level of demand for electricity. Therefore, we should like to see some rather more sophisticated statistical mechanism—which must exist—in order to ensure that demand is not overestimated.
Further, the noble Baroness said that this amendment would in some way cut down the emphasis on renewables. I am afraid I totally failed to follow her argument on that point. I could not see any reason why this amendment would exclude that. Further, I do not believe that the decisions as regards what will be nuclear and the level of the non-fossil fuel quota are going to be economic decisions; I believe that they will be political. That is the essence of what this Bill is about in the clauses we are discussing at the moment. These are political decisions to go in for and continue with a certain programme. That may have stemmed from good political decisions or bad political decisions. I shall not argue that point at the moment. However, the decisions are not based on the economic facts as we know them at the moment. That is why I come back to this amendment and why I state that it is economics which should decide the matter rather than politics.
A current theme of my noble friend Lord Peston, myself and my honourable friend in another place, Mr. Blair, is that if it can be shown that the economics are right, we would be prepared to go along with whatever is economically satisfactory. If the economics are not right, there must be some reasonable political view as to why we should have a non-economic situation. However, having gone through that argument today—no doubt the argument will continue for a number of days yet—I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Shepherd Lord Shepherd moved Amendment No. 78:
Page 26, line 35, at end insert—
("(7A) No non-fossil fuel generating station shall be rated in such a way as to discriminate unfairly against it in comparison with other types of generating station.").
The noble Lord said: My Lords, I move this amendment with the feeling that the noble Lord, Lord Gray of Contin, would stand foursquare with
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me if it were necessary to go through the Division Lobbies. The amendment seeks to allow or to ensure that the rating parity between small and large generators should be the same; in other words, there should be no unfair discrimination through the rating system against private, small operators.
In evidence presented to Sub-Committee B, it was quite clear that this was an inhibiting factor in a number of projects, particularly in the field of renewables. A question was put to Mr. Michael Spicer on 10th March with regard to the adverse disparity as regards the small operator. Mr. Spicer replied:
"The Department of the Environment are very much aware of that, and they are reviewing this matter very seriously in terms of the 1990 commitment to a new rating structure, and certainly we believe that it is right that the obstacles and the distortions which exist in the market against certain new forms of generation and a variety of size rates should be removed".
There was therefore a commitment given by Mr. Spicer in regard to legislation. I was told not so long ago that the Government had already dealt with this matter. I was not aware of that, and I have not been able to find out whether or not that is correct. But if it has not been dealt with, I should think it would be right, with the passage of this Bill, that we should ensure that operators and generators, whether they are private, big or small, be treated as my amendment suggests. My amendment suggests that:
"No non-fossil fuel generating station shall be rated in such a way as to discriminate unfairly against it in comparison with other types of generating station".
This is an important point in terms of the passage of this Bill. If the matter has not been dealt with by earlier legislation, the commitment that has been given is a very open-ended one which could adversely affect small operators. I cannot believe that that is the intention of Her Majesty's Government. I beg to move.
Lord Renton: My Lords, I am sure your Lordships would agree that we do not legislate as a rule, especially in detail, in a way to prevent the unthinkable from happening. To me it is absolutely unthinkable that there might be discrimination—
Lord Shepherd: There is!
Lord Renton: My Lords, I do not think there could be discrimination against fossil fuel generating stations once this Bill is passed. We have so much in the way of provisions here to encourage and require them to be given a proper run and a fair crack of the whip, that to add this point as well seems to me to be quite unnecessary.
Baroness Gardner of Parkes: My Lords, I find the point about rates very strange. I know that the electricity industry has always been unhappy with the present rating system. However, under the new rating system there will continue to be a right of appeal. If one is discriminated against, one therefore has a right of appeal. I do not understand the amendment.
6 p.m.
Lord Kearton: My Lords, I support the amendment. I would say to the noble Lord, Lord Renton, and the noble Baroness, Lady Gardner of Parkes, that Sub-Committee B received evidence from small producers that the cost of electricity was doubled by the anomalies of the rating system. Despite what the noble Lord, Lord Renton, said, the present situation has meant that small producers are very unfairly discriminated against. The sole purpose of the amendment is to ensure that that does not happen in the future.
Baroness Hooper: My Lords, I was somewhat puzzled by the amendment. I thought that it might refer to rating in the sense that the noble Lord, Lord Shepherd, has explained, but it could equally have applied to capacity rating, which we discussed earlier, on the basis of intermittent sources.
The Government have agreed in principle—and an announcement was made by the Secretary of State—that private generators exporting electricity to the electricity supply distribution network should be rated on a comparable basis to the rest of the electricity supply industry. That means that small generators and private generators will be on the same footing as others.
Although Section 34 of the General Rate Act provides for the extension, by order, to other generators of electricity of the formula contained in Schedule 7 to the General Rate Act 1967, which provides for the rating of electricity boards, that formula is not in a form which can be applied to independent electricity suppliers. The same is true of the existing formula for Scotland. The Government have put in hand a revaluation of all non-domestic property and, as a part of that revaluation, are reviewing the statutory rating formula for England, Scotland and Wales. That review will take account of the need for a more broadly applicable basis of assessment in respect of electricity generation. The outcome of the review will be new rateable values to be brought into effect from 1st April 1990 together with the new valuation lists.
At that time it is intended that any new electricity generator or combined heat and power scheme which has the capability to export electricity to the electricity supply industry's distribution network will have its rateable value assessed on a comparable basis. While the review of formula rating is progressing it is obviously not possible to say what that basis will be.
That is the position as it stands, but I think that it goes some way to meeting the anxieties expressed by the noble Lord.
Lord Ezra: My Lords, before the noble Baroness sits down, will she explain what would be the rateable situation of those generators which do not export electricity but which could be quite sizeable, supplying the internal requirements of industrial activities?
Baroness Hooper: My Lords, if I may, I shall write to the noble Lord to clarify the position. It is my
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understanding that the same basis as I have described will apply.
Lord Shepherd: My Lords, I am not very sure how far the noble Baroness has taken me down the road, or the lane, in this respect. It is a serious matter, and despite what the noble Lord, Lord Renton, and the noble Baroness have said, my noble friend Lord Kearton is quite right. Clear evidence was put before the Committee. It was accepted by Mr. Spicer, the Minister within the Department of Energy, that that was the case.
I cannot say that the reply was satisfactory, but I appreciate that the noble Baroness did not understand the purpose of the amendment. Therefore it would be unfair to be too critical. However, the noble Baroness had better get a new and improved departmental brief in this respect before Third Reading. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Shepherd Lord Shepherd moved Amendment No. 79:
Page 27, line 18, at end insert—
("(9A) The Secretary of State may by order establish an authority which shall promote and supervise the generation of electricity from tidal power.").
The noble Lord said: My Lords, this is a probing amendment. The amendment is very much in line with the inquiry which is presently being undertaken with regard to the Severn barrage and the Mersey barrage. I am sure that the noble Lord, Lord Gray of Contin, will welcome this.
If the Severn barrage were in existence it would produce electricity to the order of 7 per cent. of present electricity production. That in itself is significant. The difficulty is that, apart from planning permission matters, the barrage would cost approximately £13.5 billion. On the other hand, if the barrage were built it would have an operating life of at least 120 years. With inflation and the changing value of money, I am not sure what the relationship between 120 years and £13.5 billion is. At the end of the day it may prove competitive with other investment decisions.
A project of that order is clearly beyond the capacity of even the new generating organisation, but we must recognise that it may one day be in the public interest for the Severn barrage, or the Mersey barrage, to be implemented. The question therefore is, if such a project were undertaken it would need to be undertaken by the Government, or by the Government in conjunction with private industry. I would prefer the latter to a purely state-funded project. If that were so, how could that be achieved? Would it be limited by the provisions of the Bill, or would it require new legislation or amendments to this Bill in regard to competition with the established generating companies?
This is very much a probing amendment to see whether the Government have considered this aspect. However, I know that they are awaiting a report at the end of this year. I understand that they are awaiting it with interest and a good deal of sympathy. I shall be interested to hear the response of the Government. I beg to move.
Lord Renton: My Lords, I am sure that all noble Lords are grateful to the noble Lord, Lord Shepherd, for raising this important question of generation by tidal power. I should have thought that the Bill probably enables the Secretary of State to take steps to see that somebody does this if public money is provided. As the noble Lord says, it is a huge sum. I do not think that it would come from private sources.
I shall be very interested in the Government's reply. I say in passing that it is only a probing amendment. I should not wish to see a separate authority established. I doubt whether that would be necessary.
Viscount Hood: My Lords, I think that this amendment is unnecessary and could conceivably be harmful. As the noble Lord, Lord Shepherd, said, a report is pending. It is being funded partly by Government, partly by the CEGB, and partly by private interests, one of which is George Wimpey Ltd, of which I am a director and therefore declare an interest.
The barrage is an enormous project and if at some point it becomes practical it will be carried out by private enterprise because the industry will have been privatised. This is where the amendment could conceivably be harmful. If a private entity proposed to enter such an enterprise I do not believe that it would want there to be in existence an authority which could complicate the business. I therefore suggest that, at this point in time, it would be better not to pass the amendment.
Viscount Hanworth: My Lords, the amendment uses the word "may". It does not state that such an authority must be established. I should like to make just two points. One must consider the viability of those long-term projects over their lifetime which may be 100 years or more in the case of a tidal barrage. In my view, it will never be promoted entirely by private enterprise. That is not to say that, if the Government gave a certain amount of help or some guarantees, it could not be brought about. That is an important point to bear in mind. If I am right that it cannot be initiated solely by private enterprise, it is a good thing to incorporate the amendment in the Bill because it is merely permissive.
Lord Somers: My Lords, I am entirely in favour of the amendment, but I wish that the noble Lord had inserted two words at the end. I wish that he had inserted the words "or wind" after the word "tidal". Wind power is certainly a possibility. I saw a film on television not long ago which demonstrated to me quite convincingly that wind power was a possible source of electricity. Although, during the past few days, one may have wondered what has happened to the wind, there is no doubt that it still blows up in the north. I therefore think that it would be a possibility to carry out experiments with wind power.
Lord Hatch of Lusby: My Lords, I should like to support what the noble Lord, Lord Somers, has said
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about wind and wave power. Perhaps I may add my own probing to that of my noble friend Lord Shepherd. Perhaps the Minister will tell us, first, whether it is the case that, some months ago, the Government either gave up or drastically reduced their research subsidy to the examination of wave power. Secondly, has she seen the statement that was made yesterday by the north-west region that 14 per cent. of the energy needs of the region could be met by wind and wave power? That 14 per cent. is not to be taken simply as 14 per cent. of the 100 per cent. Presumably, it is 14 per cent. of the 20 per cent. that is allocated to non-fossil fuels.
Lord Howie of Troon: My Lords, the point that we must bear in mind is that my noble friend Lord Shepherd said that this was a probing amendment. He is trying to find things out. There is therefore little point in delving too deeply into the wording of his amendment.
I support the amendment in general terms. I should like to see the Severn barrage promoted and producing electricity. I do not care whether the work is done with public or private money so long as it is done with some money. It may not be done with private money, but it should be done by someone. I make no ideological distinction between private and public money so long as money is spent on that project.
I should like to go a little further and remind the House that this is not merely a matter of the Severn barrage or the Mersey barrage. Work on tidal power is being done in Queen's University in Belfast, for example, on a wholly different prospect. Professor Salter at Edinburgh has made proposals which I think are somewhat fanciful, but there may well be something in them in the long run. It is a little sad that the principles behind the work that is being done in Belfast have already been adopted by the authorities in Norway. We are being outflanked in that area where we might have been to the fore.
I support in general terms the ideas that underlie my noble friend's amendment. I should like to end by uttering a cautionary word about wind power. It is clearly desirable that we should utilise every source of energy that we can find. In that respect, I am entirely in support of the Government's generalised policy of finding as many sources of power as possible—tidal and wind among them. However, not long ago, I made a comparison related to Pembroke power station which is a 2,000 MW station. I worked out that, in order to replace it by windmills, one would require a windmill every 100 metres round the Welsh coast from Cardiff to Liverpool. That is an interesting prospect and I am sure chat the Welsh deserve it, but environmentalists would perhaps raise a query as to whether it was the right thing to do. I am sure that there is something to be found from wind power, but on the domestic rather than the industrial scale. At all events, I mention wind power here because I think that it should be kept out of my noble friend's amendment.
6.15 p.m.
Baroness Hooper: My Lords, the Government certainly accept that tidal power has the potential to

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make a contribution to generation in the longer term. Indeed, the Department of Energy's "Energy Paper 55" suggested that, of the technical potential of 54 TWh, up to 28 TWh might possibly be commercially exploitable by the year 2025.
The Government are already doing a significant amount to identify the commercial prospects for tidal energy. Feasibility studies are under way with consortia for the Severn and Merseyside estuaries and a number are planned or under way for smaller estuaries. But as the noble Lord, Lord Howie of Troon, pointed out, all forms of energy generation have environmental consequences. We must recognise that some of the difficulties that have been raised in relation to those studies are in respect of the environmental impact of those schemes. However, the consortia which are dealing with those arrangements consist of a mixture of public and private sector investors at present. We believe that they are already doing the job of the kind of tidal quango that the noble Lord, Lord Shepherd, proposes in his amendment.
As has been recognised, one of the objects of the extra tranches for renewables is to give a considerable boost to the commercial prospects for early tidal schemes. I specifically mentioned that we shall take into account the lead times of the different types of renewable plant. Tidal power has lead times of seven to 10 years. In Clause 34(9), we have provided the ability by regulations to allow tidal power to make its contribution to the non-fossil fuel obligation in the way that I explained earlier.
However, our aim goes wider than tidal power. We want to encourage all competitive and environmentally acceptable renewable technologies. The wind research programme is well advanced with a collaborative programme with industry spending £5 million a year. We expect that the contribution from wind power will be made via the manufacturing and electricity industry without the need for a separate authority to promote it.
Concerning wave power, research on large-scale off-shore wave power was curtailed in the early 1980s after a £17 million research programme had shown that it was unlikely to contribute at an economic rate. Research into smaller scale wave energy which shows more promise continues, including the work by Belfast University to which the noble Lord, Lord Howie of Troon, referred. As to his reference to Norway's wave device, I understood that in fact it fell down last Christmas. However, I am quite aware that the technology of Norway is progressing in this respect.
The noble Lord, Lord Shepherd, asked specifically whether the Bill would prevent a Severn barrage being built or if new legislation would be required. Whoever it may be when the time comes, the operator would need a generator's licence, but the Bill would not prohibit the construction of a barrage. However, the application for, and obtaining of, a licence is a preliminary step that would have to be taken. A private Bill might well be needed to enable the promoters to acquire land and carry out works; otherwise, there is nothing in the Bill which would prevent a potential Severn or Mersey barrage.
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Indeed, we believe that the renewable tranches would give a boost to it.
So, in suggesting the setting up of an authority specifically to promote tidal power, I believe that the best promoters and supervisors are the companies which intend to harness and operate that power. We are assisting those companies with joint funding of the studies and through the proposals in the Bill. Indeed, our aim in privatising the electricity industry and creating scope for competition is to remove the generation of electricity from government interference, not add to it. Therefore I cannot accept the noble Lord's amendment. I hope that he will decide to withdraw it.
Lord Shepherd: My Lords, this was a probing amendment. I agree with the noble Lords, Lord Howie of Troon and Lord Somers, that wind power has the same problems although perhaps in a less degree than tidal power generating stations and barrages because of the long period of pay-back. I agree with the noble Lord, Lord Howie, that wind power and wind farms of any great size on land are unlikely to become a practical issue, although I am advised that cattle and sheep happily graze between the stanchions of the turbines. However, the noble Lord is right; there is a long pay-back. I am sure that in the future wind farms, if they do come into being, will be offshore, and the costs will be infinitely higher than if they were put on the land.
As for the noble Viscount, Lord Hood, I do not think that there is anything between us. I used the word "authority". I did not know what other word to use. I could have put "company" or "plc" or many other things, but I used the word "authority" to ascertain whether there was some body or some organisation which would fit into the terms of the amendment. I am influenced neither one way nor the other as to whether this is financed by government, private industry or a mix of both.
The noble Lord is confident that this will be financed by the private sector. We must wait and see when the issue arises. I doubt it, unless there is some clearer undertaking of continuity in taking off the supply. If 7 per cent. of present-day energy resources suddenly became available through the barrage, it would create a massive over-supply to the great detriment of the generating companies set up under this Bill.
I am grateful to the noble Baroness for her remarks. I shall read them with care. I do not think that I shall come back on this point; however, I fear that I shall do so in respect of the other amendment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Peston Lord Peston moved Amendment No. 80:
Page 27, line 23, at end insert—
("(11) That all applications for major capital projects planned as a result of this section should be subject to the outcome of a planning inquiry held in public.
(12) That the provisions of this section and the orders arising from it shall be discounted as evidence for the purpose of any public inquiry under subsection (11) above.").
The noble Lord said: My Lords, this amendment is connected with Clause 34 which concerns electricity

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from non-fossil fuel sources. It is intended largely to deal with nuclear energy and how to protect it. First, I should like to make one general remark about the clause as a whole. Despite what is intended by this clause, I and my noble friends regard the Bill as a whole as more threatening to the British nuclear power industry and as placing it in greater peril than anything that the anti-nuclear groups have ever done.
I notice that my noble friend Lord Hatch of Lusby is in the Chamber and perhaps I may therefore be slightly mischievous at this point. If he is really anti-nuclear, this is the Bill that he ought to support. I say that in terms. In my view, this section of the Bill would not reassure anybody who felt that nuclear power was an important part of our future energy supply.
Partly, the purpose of this amendment is to enable us to go further into certain matters dealt with earlier by the noble Lord, Lord Sanderson. I should like more assurance. I have not yet mentioned what I think he said; I should like to remind him of it. He said that all planning applications, even those coming under this heading, would be subject to the normal planning laws. I am fairly sure that he said that, and I should like to have it clarified to make absolutely certain that there is no doubt that the non-fossil fuel protection clause (if I may call it that) does not, and could not, get round the general question of planning law. I am fairly sure that he reassured me on that point, but I should like to pursue it.
Beyond that point, and perhaps more importantly, the amendment seeks further clarification about how such a planning inquiry would be undertaken; that is to say, if a nuclear station is being examined in a planning inquiry, whether it could be argued that almost everything that would normally be raised in such an inquiry has to be set on one side. It can be raised but it has to be set on one side simply because the nuclear station is required to meet the purposes of Clause 34 about electricity from non-fossil fuel sources.
In other words, we argue in our amendment that whatever view one takes of non-fossil fuel sources and nuclear energy per se surely it cannot be the purpose of this Bill, or this Government, not to scrutinise any such power station in the normal, if extremely complex and convoluted, way. Those who would be applying to build such a station could not, as it were, seek more or less to ride roughshod over the normal planning processes by saying, "Look, we have to meet this non-fossil fuel requirement and you just have to let us build this power station whether you like it or not".
So the two parts of the amendment have different but related purposes. I should like to hear what the Minister has to say on those matters. I beg to move.
6.30 p.m.
Lord Hatch of Lusby: My Lords, in supporting the amendment of my noble friend, I ask the noble Baroness when replying to answer questions which I put to her together backed by some evidence that there is a growing disquiet among the public in places
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where power stations are being built about both the nature and the conditions of public inquiries. It is widely thought that the public inquiries that are being held and are likely to be held, are being limited in their scope compared with what has happened previously at such places as Sizewell and Hinkley.
Although it has taken many months for the CEGB to prepare its planning applications, the public—laymen—are being given at the maximum a matter of three months to organise in detail their objections to these power stations on planning applications which have taken the CEGB many months to prepare. In particular, for many organisations that meet only once every quarter, it is limiting public inquiries to such an extent as to distort the right of the public to express their views.
I have referred the noble Baroness to both the proposed inquiries at Sizewell over Sizewell C and to the inquiry at Wylfa over Wylfa B. I know from personal experience that in both these areas there is very wide public disquiet about both the limitation of the terms of reference of the inquiry and even more so, about the limitation of time during which the public are being allowed to submit their objections. I therefore hope that the noble Baroness will take the opportunity of at least expressing some consideration for what the public are demanding.
Those demands are for free inquiries into the necessity for the building of these power stations; and for at least double the period of three months so that the public have the opportunity of mobilising their arguments, co-ordinating their opposition and examining the documents in such a way that their view can be put in a coherent way, which will express the very grave disquiet that is being, shown in all these areas.
Lord Renton: My Lords, there are two words in these amendments that give rise to a great deal of trouble and ambiguity. In the new subsection (11)—which incidentally I do not think is necessary anyway, because I think that all major capital projects will be, and always have been, the subject of planning inquiries—the words "outcome of a planning inquiry" are a little ambiguous. Does that phrase mean the inspector's recommendation? Does that mean the Secretary of State's decision, or, if it is a matter that does not go to the Secretary of State but to the local authority, is it its decision? What is the "outcome"? That is my first point.
In subsection (12)—to which I am personally opposed—the word "discounted" appears. Does that mean that the evidence shall be inadmissible, or that it shall be admissible but disregarded% In any event, it is a very strange thing that we should legislate and then say that some of the provisions of our legislation shall be dicounted for the purpose of the public inquiry—ignored. It is a very strange way to legislate and a very strange outcome of legislation.
Lord Howie of Troon: My Lords, I hope that the Government will treat this amendment with the utmost possible caution. My experience of large scale construction over the past generation or so is that public inquiries have changed their nature. At one time they were inquiries into the need for

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constructions. They have long since ceased to be anything of that kind. They are now methods by which construction can be at best delayed or possibly stopped altogether.
Lord Hatch of Lusby: That is democracy.
Lord Howie of Troon: My Lords, it may well be democracy, but democracy means doing things as well as stopping them. I think we must be careful about this.
My noble friend Lord Hatch of Lusby—who keeps interrupting me from his seat—asks for a longer period than three months. I wonder why? If one considers the progress of the most recent notorious public inquiries, what happens is that a travelling circus moves from inquiry to inquiry bringing the same information which was produced at the last inquiry. They do not need three months for it. They do not need ten minutes; they have it already.
I am not saying that we should not have inquiries. Obviously, we should. But we should revert to the situation where inquiries were treated as inquiries and not as obstacles over which necessary construction had to leap.
Baroness Hooper: My Lords, I feel that the contribution of the noble Lord, Lord Howie of Troon, has answered adequately the points raised by the noble Lord, Lord Hatch of Lusby. At Question Time recently I answered very carefully similar questions that he raises now. The Secretary of State is required to allow a minimum of 21 days in which objections to a power station application can be made to him. However, in the cases of Wylfa B and Sizewell C, to which the noble Lord referred, the Secretary of State is allowed three months for any objections to be made for registration.
Having said that, I certainly give the noble Lord, Lord Peston, the confirmation that he seeks of his understanding that all the normal regular planning procedures will have to be fulfilled and that the provisions of the Bill are additional.
Perhaps I may refer again to the provisions of Clause 37 of the Bill. They require any operator wishing to construct, extend or operate any generating station over 50 megawatts to seek a consent from the Secretary of State. Clause 37 will provide a unified procedure for all electricity operators and will draw together the current provisions under the Electric Lighting Act 1909, the Town and Country Planning Act 1971 and the Energy Act 1983.
Planning permission will also be required. Where a consent under Clause 37 is needed, paragraph 7 of Schedule 8 continues the present practice of enabling the Secretary of State—when he gives the consent—also to direct that planning permission shall be deemed to be granted. Before making an application to the Secretary of State for a nuclear station or a station of 300 megawatts or greater thermal capacity, the company will be required to undertake an environmental impact assessment of their proposals, under the new regulations made to implement the European Community's
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environmental assessment directive. In addition, the company will be required to consult the local planning authority to ascertain if it has any objections.
As noble Lords know, if the local planning authority has made objections which are not withdrawn, then under paragraph 2 of Schedule 8, the Secretary of State is obliged to hold a public inquiry before reaching his decision, unless he imposes conditions or modifications to meet those objections. Under paragraph 3 of Schedule 8, he may also hold an inquiry after consideration of objections made to him by other interested parties or to meet his own concerns. A station under 50 megawatts will not require consent under Clause 37, but will require normal planning permission.
I believe that these controls are sufficient to ensure that no power station is constructed until there has been the opportunity for all concerns to be aired. The new provisions in the Bill will simply continue the current procedure. As has been said, a public inquiry was recently held into the application for the Sizewell B nuclear station and an inquiry is currently under way to consider the application for the Hinkley C station. After privatisation, public inquiries will continue to be held in the say way for two further planned PWRs and any other capacity that is planned.
As to the second part of the noble Lord's amendment, I believe that it would be totally unacceptable for the requirements of Clause 34 and any orders under the clause to be discounted as evidence at an inquiry, whatever that may mean. As my noble friend Lord Renton has asked, the Secretary of State should and will have to consider all the relevant evidence concerning the application. If a generating station is proposed to be built as a result of contracts signed in pursuance of the statutory non-fossil fuel obligation on a public electricity supplier, that is a relevant fact to be considered by the Secretary of State. To do otherwise would place the applicant at a severe and unfair disadvantage.
However, it will not be the case that a generator will only have to show that a station would contribute to the non-fossil fuel obligation to receive a consent. The obligation will have to be met, but it is up to the industry to decide how it chooses to do this. Each application will be considered on its own merits, and if a public inquiry is held into such an application, all the relevant implications of the proposal will be considered in the same way as they would be in any other inquiry. It would be entirely possible for the Secretary of State to refuse a particular application and the public electricity supplier concerned would then have to consider how the obligation could be met in another way.
I also believe that the amendment is ill-conceived. In the past the CEGB has had a statutory duty to provide bulk supplies of electricity and it has been able to argue that duty in support of applications for new power stations. In future the CEGB's successor generating companies will have no such statutory duty. It will have to base its arguments for new stations, whether fossil or non-fossil, on a need to meet contractual commitments entered into in order

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to supply electricity. The statutory duties both in relation to supply and the non-fossil fuel obligation will rest with the public electricity supply companies. It will be for them to argue the need for new capacity.
It would be just as wrong to exclude from their arguments the statutory duty in respect of the non-fossil fuel obligation as it would be to exclude the obligation to supply. Both are relevant to applications for new non-fossil capacity. I invite the noble Lord to withdraw his amendment.
Lord Hatch of Lusby: My Lords, before the noble Baroness sits down, the question I asked was not how long the Secretary of State has to give nor how long he has given. I knew those answers and repeated them. I asked the noble Baroness whether she would consider extending the length of time from three months to six months.
In the case of Sizewell C and Wylfa B, to take the two current examples, will she tell the House whether she has been petitioned by a substantial number of the local residents to increase the time for objections to be sent to the Secretary of State and perhaps also to increase the time for local authorities which have been given only eight weeks? If such a demand is made by the local residents will she at least consider it?
Baroness Hooper: My Lords, of course I shall look with interest at all the contributions to the debate. However, I believe that the point raised by the noble Lord is not relevant to the amendment now before the House.
Lord Peston: My Lords, I thank the noble Baroness for her answer to the first part of my amendment. With due respect to the noble Lord, Lord Renton, its meaning is perfectly obvious. It means what I said: that the normal planning procedures will apply. The noble Baroness has said that that is so—
Lord Renton: My Lords, that is what I said. In every major capital construction there would be a planning inquiry.
Lord Peston: My Lords, there is no difference between us on that matter. However, in a Bill as complicated as this there is no harm in obtaining reassurance from the Government that that is still the case. I say to my noble friend Lord Howie of Troon, with whom I have rarely, if ever, disagreed, that I was not happy with what he said. I regard myself to be at least as much as a technocrat as any Member of your Lordships' House. As regards major planning issues, I certainly believe that the community, both in the small and the large, has the right to make its views felt. In dealing with the big battalions of technocrats like me, it also has the right to receive such assistance as it can so that its views can be put forward. I hate to disagree with my noble friend but I did not care for what I thought he said—so he is about to say some more.
Lord Howie of Troon: My Lords, this is the second time within minutes that my noble friend has been
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shown to be wrong. He was wrong in replying to the noble Lord, Lord Renton, and was wrong again in replying to me. I hope that he gets it right before the end of the debate. He knows that I have nothing against the small man. I have no objection to people having their objections. I objected to the circus which is entirely different.
Lord Peston: My Lords, I do not agree with that either. Okay, I have made my point and so much for that. My real concern is with the second part of the Minister's answer. I feared that she would give that answer and I was sorry to hear it. She is almost certainly right that it follows inevitably and logically from this clause that the kind of considerations of the commitment to the non-fossil fuel quota must weigh in the balance in a public inquiry. Therefore, it could happen that a power station which was regarded as being most unsatisfactory on environmental and community grounds and might even be unsatisfactory on normal cost benefit grounds would, nonetheless, have weighed in its favour the argument that there is a commitment to non-fossil fuel sources; in this case, nuclear. The noble Baroness said that it could weight in the balance and would not be decisive on its own. I am glad that she said that because that is my reading of what the Bill must state. My view is that it is not a satisfactory state of affairs. In a sense I have discovered what I wanted to discover and I have said what I wanted to say. I am now perfectly happy to withdraw the amendment.
Amendment, by leave, withdrawn.
6.45 p.m.
Clause 35 [Fossil fuel levy]:
Baroness Hooper Baroness Hooper moved Amendment No. 81:
Page 27, line 36, at end insert—
("(1A) The amount of any payment which is required by regulations under this section to be made by any person in respect of the levy shall be calculated by such method as may be specified by the regulations.").
The noble Baroness said: My Lords, I should like to speak also to Amendment No. 82. They are related amendments which are required to make clear on the face of the Bill what the fossil fuel regulations will cover. As a result of our discussions on this topic in Committee I realised that noble Lords have a strong interest in the matter.
The substantive amendment is No. 82. It sets out in a little more detail the mechanics of certain operational aspects of the fossil fuel levy. Perhaps it would be helpful if I explained what effect the amendment will have.
The Director General of Electricity Supply—as the person who is to be prescribed for these purposes by regulations under subsection (1)(b) and (c)—will be responsible for the calculation, collection and redistribution of the levy and he will, of course, need to be able to enforce the levy as well as supervise its smooth operation. The provisions of regulations referred to in this amendment will place a duty on licence holders to provide whatever information or facilities may be necessary to allow the director general to carry out these functions.
Secondly, the regulations will specify when levy payments—whether made by all licensed suppliers in respect of the levy, or to public electricity suppliers out of these payments—have to be made. There will of course be a regular schedule of payments as we go through the year to make sure that no one can get too far behind in their levy payments.
Thirdly, the regulations will provide a mechanism for adjusting any under or over-payments of the levy which might arise. That is necessary because in any one year the calculation of the levy will have to be based on forecast information. As part of that, there will be a forecast of the extra costs which the public electricity suppliers are likely to incur in the year as a result of the obligation. That will be based on assumptions about what, for example, the availability of the nuclear stations is likely to be in the year.
It may be that the nuclear stations turn in a particularly good performance in that year and as a result the prices which the public electricity suppliers pay for each unit of nuclear may be lower than expected. The levy based on a forecast may therefore lead to too much money being collected. That over collection will be used to reduce the levy in the following year.
Amendment No. 81 is simply a consequential amendment which follows on from Amendment No. 82, although it precedes it. That merely transfers some of the wording of subsection (5)(a) to a new subsection. Those amendments make no change in policy but simply make clear on the face of the Bill what regulations may include on these important matters. I beg to move.
Lord Peston: My Lords, I thank the noble Baroness for her clarification of the amendments. As I understand it, it will remain the case that fossil fuel levy will be borne entirely by the customers of the electricity industry. Therefore, there is no change of substance there.
Perhaps I may ask one question in terms of the drafting as to whether it has any significance. Subsection (5) states:
"Regulations under this section shall",
and they are replaced by a form of words which in the end amount to:
"Regulations under this section may".
Since the words "may" and "shall" do not have the same meaning in our language, I ask whether any significance is to be attached to the fact that "shall" has been replaced by "may". As the noble Baroness said that nothing of substance has changed, I ask whether or not that is possibly a typographical error.
Lord Renton: My Lords, my noble friend can answer much better than I: but as I see it the answer is this. Formerly, subsection (5) as drafted said that the regulations under this section "shall", and then it sets out several things which are now to be left out.
However, it now says that the regulations "may" do the various things set out in Amendment No. 82. That is not inconsistent with what follows when we find the words:
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"and the Secretary of State shall exercise the powers conferred by this section in the manner which he considers is best calculated to secure that the sums realised by the levy are sufficient".
There is nothing inconsistent between the word "may" to be introduced by the amendment, and the word "shall" which binds the Secretary of State as to the way in which he exercises his discretion.
Lord Howie of Troon: My Lords, I come to the support of my noble friend on the Front Bench. There is no point in saying that there is no difference between the word "may" and "shall", and that there is no change in removing "shall" and inserting "may". We have been debating this matter since time immemorial, and no doubt the debate will go on forever. However, there is no point in saying that there is no change because there is a change and the Government should admit that.
Baroness Hooper: My Lords, I did not say that there was no change, but I said that there was no change of substance. I cannot add anything to the explanation given by my noble friend Lord Renton.
On Question, amendment agreed to.
Baroness Hooper Baroness Hooper moved Amendment No. 82:
Page 28, line 11, leave out from ("section") to first ("the") line 17 and insert ("may—

(a) impose requirements (whether as to the furnishing of records or other information or the affording of facilities for the examination and testing of meters or otherwise) on persons authorised by a licence to supply, transmit or generate electricity;

(b) make provision as to the times at which payments falling to be made in pursance of the regulations (whether payments by way of levy or payments to public electricity suppliers) are to be so made; and

(c) require the amount of any overpayment or underpayment which is made by or to any person (whether it arises because an estimate turns out to be wrong or otherwise) to be set off against or added to any subsequent liability or entitlement of that person.

(5A)").
On Question, amendment agreed to.
Clause 37 [Provisions supplementary to section 36]:
Lord Peston Lord Peston moved Amendment No. 83:
Page 30, line 16, at end insert—
("(3A) The Secretary of State shall lay before each House of Parliament a copy of every direction given under section 36 above or this section unless he is of the opinion that disclosure of the direction is against the interests of national security.").
The noble Lord said: My Lords, Amendment No. 83 relates to Clause 37 in which the Secretary of State gives or may give directions of a particular kind. The question one raises is largely to do with general anxieties about parliamentary control which my noble friend Lord Williams of Elvel has raised on many occasions in this and similar Bills. Ignoring the obvious point on national security where we should never be in disagreement, should there not be a necessity to lay before your Lordships' House and the other place a copy of every direction which the Secretary of State laid under this clause?
I ask the question; but it may be that it is simply taken for granted that he will do that willy nilly, or it would just happen. In speaking to this amendment, I may be merely revealing my lack of knowledge of

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how aspects of the system work. However, in my reading of Clause 37 I cannot see where the Secretary of State must lay copies of these directions before both Houses of Parliament. I have looked elsewhere in the Bill and I cannot find that kind of consideration there at all.
Curiously—and I believe that noble Lords are well aware of this—in what was Clause 95 that kind of provision appears. I have not checked whether it is still Clause 95 because I discovered to my horror today that several clause numbers have changed and I have only just caught up with certain aspects of the renumbering. However, it is not obvious to me that what is said there carries back to this clause, but logically I cannot see the difference. I raise this matter because I am interested to know the nature of the relevant argument. I should like to see whether there is anything I have missed which I can do something about. I beg to move.
Lord Rochester: My Lords, it seems plain that the directions which the Secretary of State may give under Clauses 36 and 37 may be of very considerable consequence. Therefore, it seems to me reasonable that he should be required to lay a copy of any such directions before Parliament.
7 p.m.
The Minister of State, Scottish Office (Lord Sanderson of Bowden): My Lords, the noble Lord, Lord Peston, raised the question of the mirroring of what he saw in Clause 95 in the amendment that he proposes. It seems to me that Clauses 35 and 37 are directed to different circumstances. Therefore, it may be helpful if I attempt to outline why the provisions in these clauses have been framed in the way in which they have. Ensuring the security of supply to electricity consumers in times of disruption to fuel supplies continues to be of importance to the privatised industry and to the nation.
In framing our proposals we have taken the necessary steps to ensure a continuing security of supply. These are steps which any prudent Government would take. The powers in Clause 36 allow directions to be given to the operators of power stations about the level of stocks that they must hold and also, should circumstances warrant it, allow directions to be given about the use of stocks and the operation of those power stations.
As I explained in Committee, complementary powers over the National Grid company have also been taken in Clause 37 to reflect the importance we attach to the special partnership that will be necessary between generators and the transmission company in times of fuel shortage to ensure the continuity of supplies. These powers have to be flexible to be capable of coping with a wide range of possibilities. Far-sighted we may be, but we obviously cannot foresee the exact circumstances that might disrupt electricity supplies to consumers.
That said, I remind the House that these powers are very different from the more general powers we are taking in Clause 95. The latter is directed at combating national emergencies. The powers in
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Clauses 36 and 37 are essentially operational ones for the electricity supply industry. They are directed necessarily only at the specific parties involved—the generators and the National Grid company upon which we will rely to ensure that at times of fuel shortage electricity supplies continue to reach the consumer. Their effort is therefore limited to the industry alone and, within that, to the production and transmission of electricity. They cannot be used to restrict the consumption of electricity by the public at large. Moreover, there will be no secret about the directions themselves. We envisage that the stocking directions that will come into force, probably on vesting, will be seen merely as part of the whole regime in which the industry has to operate.
I take seriously what the noble Lord, Lord Peston, said. I see some merit in what he is proposing and in what the noble Lord, Lord Rochester, said about this matter. In the circumstances, I should like to take the amendment away. It does not quite meet what the Government would wish to see, but I guarantee to bring forward proposals at Third Reading to take account of this matter. An element in this may need to be addressed to satisfy the point made by the noble Lord, Lord Rochester.
Lord Peston: My Lords, I thank the noble Lord for his answer. I assure him that nothing I have said should be interpreted to mean that I am opposed to what we find in Clause 36. I feel strongly that we must have a clause by which the Secretary of State can take such matters as the national interest fully into account and act accordingly. I take his other point that this would not be a secret. It would be fairly obvious that demands would be made for copies of such orders. I am grateful for the noble Lord's sympathetic response and for his willingness to look at the matter. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Dundee: My Lords, I beg to move that further consideration on Report be now adjourned until 8.5 p.m.
Moved accordingly, and, on Question, Motion agreed to.

Royal Assent
The Deputy Speaker (Lord Alport): 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:

Control of Pollution (Amendment) Act,

Water Act,

Wesleyan Assurance Society Act.

Cereals Marketing Act (Application to Oilseeds) Order 1989
7.3 p.m.
The Parliamentary Under-Secretary of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington)The Parliamentary Under-Secretary of State, Ministry of Agriculture, Fisheries and Food (Baroness Trumpington) rose to move, That the draft order laid before the House on 7th June be approved. [22nd Report from the Joint Committee.]
The noble Baroness said: My Lords, I propose to describe briefly the background to this order, which was discussed in another place yesterday, and then to outline its main points.
As your Lordships will know, the Government are currently implementing their decision to withdraw from what is known as "near market" research and development work. We believe it right that such work, from which industry derives direct benefit, should be funded by industry, although government funding of basic research in areas of environmental concern and the public good will of course continue.
In keeping with this approach, the Government will be withdrawing from the near market research and development work which they currently undertake into oilseeds. At present the Government spend between £500,000 and £600,000 per year on such work.
It is for oilseeds producers to decide whether to take over funding of this type of research, if they believe that it is of direct benefit to industry. At the request of the farming unions, the Government therefore conducted a poll of oilseeds producers earlier this year to establish their views on possible future funding arrangements for research of this kind. The results of the poll indicated overwhelming support by producers for the setting up of a levy scheme which would enable them to fund research and development work in this sector.
The Government recognise the need to provide the industry with an appropriate mechanism for raising funds for this purpose. Following wide consultations, we have concluded that the best way to achieve this is by extending the functions of the Home Grown Cereals Authority (HGCA) to allow it to operate a levy scheme for oilseed crops for research and development purposes. The levy would be paid by oilseed producers and be collected at the first point of sale of the crop.
As a first step, before the HGCA can establish an oilseeds R&D levy scheme, it is necessary to extend the remit of the authority by statute to include the various oilseed crops. Such an extension is provided for under Sections 6(1) and 6(4) of the Agriculture Act 1986, which gives agriculture Ministers powers to amend the Cereals Marketing Act 1965.
There are two main elements in the order now before the House. First, the order amends Section 24 of the Cereals Marketing Act 1965 by extending the definition of "home-grown cereals", as covered by the remit of the HGCA, to include the oilseed crops of rapeseed, linseed, soya bean and sunflower seed. This will allow the HGCA to start work on a levy scheme for oilseeds. Secondly, it further amends Section 24 of the Cereals Marketing Act by changing
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the definition of "year" from a period of 12 months beginning on 1st August in any calendar year, to one beginning on 1st July. The purpose of this is to bring the HGCA's present financial year into line with the EC marketing years for cereals and oilseeds.
I should like to make it clear that the present instrument does not itself set up the levy scheme. If this order is given parliamentary approval, the HGCA will then be able to undertake the necessary consultation on, and preparation of, a draft levy scheme, which it will put to agriculture Ministers for consideration. That scheme will then come before Parliament. The Government would hope to be in a position to present that order early next year so that the levy scheme may come into operation in time for the 1990 oilseed harvest.
Oilseeds producers have demonstrated overwhelming support for the proposal to extend the HGCA's remit to oilseeds. This shows their readiness to support near market research and development in this important sector. I commend this measure to the House. I beg to move.
Moved, That the draft order laid before the House on 7th June be approved [22nd Report from the Joint Committee]—(Baroness Trumpington.)
7.9 p.m.
Lord Carter: My Lords, I should like to thank the Minister for her explanation of the order and declare an interest at the outset as a rapeseed grower, a director of a major oilseeds co-operative, one who voted "yes" in the recent grower poll and one who wrote in the agricultural press and urged other farmers to vote "yes".
It gives me particular and personal pleasure to speak on this order. In the mid-1970s I was one of the prime movers of a plan to set up an oilseeds development council. It was supported by the then Minister, Mr. John Silkin. We were on the verge of conducting the producer poll that was required, using the Ministery computer at Guildford. The computer broke down, the 1979 election intervened, and with the change of Government the whole idea of the oilseeds development council was definitely out.
The purpose of the proposed council was to set up a mechanism to allow for the collection of a compulsory levy for research and development into oilseeds. This proposal was turned down by the new Minister, Mr. Peter Walker, in 1979. Now here we are, some 10 years later, considering the preliminary and parliamentary mechanisms needed to bring in just such a compulsory levy. As the French say, the more things change the more they are the same.
As I understand the order, to bring in the levy scheme it is necessary to turn oil seeds into cereals. Judging by the report of the Joint Committee on Statutory Instruments, MAFF has got itself into a fair old muddle in its attempts to bring about this statutory transmogrification. The Minister will know that the dictionary defines "transmogrification" as meaning to transform in a magical and surprising manner. I shall be interested to hear the Minister's comments on the searching criticisms in the report of the joint committee on the magical and surprising manner in which this order has been drafted,

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including the quite magisterial rebuke in the final sentence. The committee found the memorandum persuasive in that there is recognition of the need for caution in amending primary legislation by order.
I have some specific questions as regards the order itself. When the levy scheme comes forward, can the Minister ensure that the money raised by the levy on oilseed will be ring-fenced and used only for oilseed research and development, and that it will not be allowed to leak away into other areas of HGCA activity? Can the Minister also say what control there will be over the administration charge that will be made by the HGCA in connection with the levy? The final question on which the Minister may wish to write to me is why Evening Primrose has been left out of the list of oilseeds?
As regards the turning of oilseeds into cereals for the purposes of the 1986 Act, can we be quite sure that this will not bring oilseeds into the scope of any EC restrictions that may be placed on proper cereals in the future? For example, I refer to the possibility of quotas and the like. Can the Minister say whether oilseeds will be affected by anything that the EC does with cereals? I repeat my thanks to the Minister. We are pleased to support this order from these Benches.
Lord Rochester: My Lords, I have had occasion to use Evening Primrose oil for medicinal purposes. Like the noble Lord, Lord Carter, I wonder why it was not included in this order.
Baroness Trumpington: My Lords, I am most grateful to both noble Lords. I shall first deal with the original points made by the noble Lord, Lord Carter, and finish with the joint question raised by both noble Lords. The noble Lord, Lord Carter, referred to the criticisms of the terms of the order by the Joint Committee on Statutory Instruments. I assure him that the officials in my department are indeed capable and skilled at distinguishing between cereals and oilseeds. Moreover, they are absolutely brilliant at differentiating between different types of cereal and different types of oilseeds. Perhaps I may tuck in at this stage the joint point made by both noble Lords; namely, that Evening Primrose is not considered an oilseed.
Lord Carter: My Lords, it is a seed that produces oil.
Baroness Trumpington: My Lords, it is a primrose by any other name. I understand why the joint committee raised questions about the wording of the draft order. There are many ways of drafting an order. The joint committee suggested two possible versions. However, I am satisfied that the order as drafted by the department falls within the terms of the enabling powers. In drafting the order the department was concerned to achieve maximum clarity of style while being needful of the desire for caution in amending primary legislation by order.
I can assure the noble Lord, Lord Carter, that the moneys raised from the levy will be spent solely on oilseeds research and development, apart from a
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small proportion that will go to the HGCA's administrative costs. As regards the question of bearing the cost of collecting the levy, it will be collected at the point of first sale. The first buyers deduct the levy from the price they paid to growers for the seed. I understand that the first buyers will not require a fee for collection of the levy but will make payments to the HGCA at six-monthly intervals although possibly at four-monthly intervals in the first year. The interest accrued during this time will go towards the administrative costs incurred by first buyers in handling the levy.
I am very well aware that the noble Lord, Lord Carter, is a pioneer in this matter and that he has a keen interest in the oilseed industry. I am grateful for his "yes" vote. I assure your Lordships that this order, together with the levy scheme to follow, are of considerable importance to the oilseeds industry. They should help to ensure the continued funding of research and development in this sector and thus play a part in the long-term viability of the industry.
On Question, Motion agreed to.

Fisheries Act 1981 (Amendment) Regulations 1989
7.17 p.m.
Baroness Trumpington Baroness Trumpington rose to move, That the draft regulations laid before the House, on 6th June be approved [21st Report from the Joint Committee].
The noble Baroness said: My Lords, these regulations are necessary to correct a technical breach (albeit an important one) in our Community obligations in relation to a levy imposed by the Sea Fish Industry Authority. The instrument is therefore made under Section 2(2) of the European Communities Act 1972, and amends the Fisheries Act 1981 which established the Sea Fish Industry Authority.
Under the 1981 Act the authority has a general duty to promote the efficiency of the sea fish industries by carrying out certain activities. These include carrying out research and development, giving advice, providing training and promoting the marketing and consumption of sea fish and sea fish products. For the purpose of financing these activities the Act provides for the authority to impose a levy on persons engaged in the sea fish industry. The levy is raised by weight on first-hand sale of sea fish or sea fish products landed in the UK (including imports) or transhipped within British fishery limits.
We are obliged to make the amendment because the EC Commission considers that the 1981 Act, as presently drafted, does not ensure that exporters from other member states, including fishermen who land their catches here, receive benefits from the SFIA's activities commensurate with the amount of levy they pay. It appears to the Commission that under the terms of the 1981 Act the receipts from the levies could be allocated only towards work which would be of direct benefit to the UK industry.
I should stress that the Commission agrees with us that the levy arrangements do not in practice

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discriminate against other member states who land fish here. That is why I referred to a technical breach in my opening remarks. Nevertheless the maintenance in force of the present wording contravenes the obligation on all member states not to expose imports from other member states to any form of financial burden in excess of that imposed on similar domestic products.
The amendments proposed are set out in regulation 2 of the draft instrument and concern Sections 2, 3 and 14 of the Act. Section 2 is to be amended to provide for the sea fish industries of member states other than the Untied Kingdom to receive benefit commensurate with any burden borne by them in consequence of the levy—the proposed new regulation 2A.
Section 3 is to be amended to ensure that the requirement to recover fees in respect of services provided to persons connected with the sea fish industry other than in the United Kingdom shall not apply to services provided for such persons in other member states.
Finally, a slight consequential amendment is required to Section 14 concerning the definition of the sea fish industry. These amendments have been cleared with the Sea Fish Industry Authority who do not anticipate any difficulty in complying with them.
Although the proposed changes are perhaps in the nature of a cosmetic exercise they will nonetheless help ensure the continued approval of the Commission to the authority's levy as a legitimate state aid. A successful challenge of the levy arrangements by the Commission in the European Court, albeit on technical points, could threaten the funding and therefore the future of the authority's vital work on behalf of the whole sea fish industry. The proposed amendments would avoid such a step. I commend these regulations to your Lordships and seek approval of them. I beg to move.
Moved, That the draft regulations laid before the House on 6th June be approved [21st Report from the Joint Committee]—(Baroness Trumpington.)
Lord Carter: My Lords, the House will be grateful to the noble Baroness for explaining the regulations. Perhaps I may repeat the comment made in another place when the order was discussed: is this a case of Mr. Delors strikes again?
I understand that the regulations are required for technical reasons and to bring the Fisheries Act 1981 into line with Community requirements, but I have two questions. Can the Minister explain how it is proposed to achieve the equity with other member states that is envisaged as a result of the operation of the Sea Fish Industry Authority levy, and how will this be done in practice? Secondly, is it correct that non-members of the European Community, for example Norway and Iceland, will not be covered by the regulations?
We appreciate the need for the regulations and support them from this side of the House.
Lord Rochester: My Lords, in this case I feel like a fish out of water. I shall therefore content myself
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with saying that on these Benches we have no objection at all to the regulations.
Baroness Trumpington: My Lords, I should like to thank both noble Lords very much for their welcome to this small but necessary step. To answer the two questions of the noble Lord, Lord Carter, the Commission accepts that the existing levy arrangements do not in practice discriminate against other member states' fish landed here. In giving approval to the SFIA development programme 1984–89, the Commission accepted the authority's guarantee that SFIA marketing and advertising activity does not feature the country of origin of fish; the results of all R&D are available to other member states; all SFIA training activities are available to nationals of member states; the SFIA does not employ levy funds to promote the export of fish from the UK to the detriment of other member states; and the authority does not employ levy funds to finance wholly or partly schemes of financial assistance to which only United Kingdom interests are entitled.
On the other point, the noble Lord, Lord Carter, is perfectly correct. Third countries do not receive any direct benefits. I am most grateful to both noble Lords.
On Question, Motion agreed to.
Viscount Davidson: My Lords, I beg to move that the House do now adjourn during pleasure until five minutes past eight.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 7.25 until 8.5 p.m.]

Electricity Bill
Consideration of amendments on Report resumed.
Clause 38 [Consent required for construction etc. of generating stations]:
Lord Peston Lord Peston moved Amendment No. 84:
Page 31, line 5, leave out subsection (4).
The noble Lord said: My Lords, I wish to speak very briefly to this amendment. I wish simply to ask about subsection (4). The clause as a whole refers to consents which are required. Then we are given a reasonable and specific statement in subsection (2) about exemptions, and a possible modification of that under subsection (3). But, in addition to that, and almost as if none of the rest had been written, we read a statement that the Secretary of State can make any other exemption he wishes. One is therefore slightly suspicious as to why we need this catch-all subsection, or, to put it the other way around, why we need the two explicit subsections if this one is relevant.
It may be that the Government have in mind one or two other matters which may have gone into specific clauses but which they now think are covered by subsection (4). The easiest way to flush that out is to suggest that we do not need subsection (4). I beg to move.
Lord Sanderson of Bowden: My Lords, I should like to thank the noble Lord, Lord Peston, for raising this issue. It was of course raised in Committee. First, perhaps I may make two general points and then give the noble Lord an example of a situation where what he calls a "catch-all" subsection is needed.
I should like to stress once again that any kind of power station development exempted from the need for the Secretary of State's consent will still be subject to all the requirements of the planning Acts—indeed, I think that we discussed that matter before the dinner break—and to the amenity obligation contained in Schedule 9. That will apply to any exemptions which may result from orders made under subsection (4), in just the same way as it will apply to exemptions for developments which are below the threshold in subsection (2).
The other point I should like to make relates to the concern previously expressed that the Government may be taking on powers, through an enabling provision, which would not be subject to further reference to Parliament. That is not, however, the case because the exemptions may only be made through orders which must be placed before Parliament, which will have the opportunity to express a view on them.
The noble Lord may wish to hear an example of the sort of situation we have in mind which this particular subsection could deal with. The provision will enable any generating station on offshore oil and gas installations, which generate for the operators' own use, to be exempted from the consent requirement. There are some installations—one example is the Magnus field—which have a generating station of greater capacity than the 50 megawatts threshold above which consent will be necessary.
As such installations are fully regulated under offshore legislation, we do not think that it is desirable to introduce this additional control over them. I hope therefore that the noble Lord will see that we have definite constraints on this matter, but that there are definite reasons why we wish to retain the subsection.
Lord Peston: My Lords, it is kind of the Minister to give such a clear and cogent example. I still believe that logically what is in subsections (2) and (3) could be construed to be covered by subsection (4), and so in drafting terms I believe that I am still right. Having said that, I entirely accept what the Minister said and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 8 [Consents under sections 38 and 39]:
Lord Peston Lord Peston moved Amendment No. 85:
Page 103, line 33, at end insert ("and, if not, what objections have been raised").
The noble Lord said: My Lords, I do not intend to delay your Lordships long. Paragraph 1(2)(b) provides that the application must state whether all necessary wayleaves have been agreed with owners
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and so on. I do not need to trouble your Lordships with the exact words. The sub-paragraph concludes:
"and shall be supplemented, if the Secretary of State so directs, by such additional information as may be specified in the direction".
I should like some comment on the point, which I would expect to be the case, that the Secretary of State when providing any such additional information would be bound to say a word or two about objections and their nature. He would find it hard to get away with not doing that. I should like to hear a word or two as to whether I am right that where it says "such additional information" it is possible, if not necessary, that the objection that my noble friend and I raise could come under that heading.
Lord Sanderson of Bowden: My Lords, I do not believe that there is a necessity for the amendment because adequate provision has been made in paragraph 6 of Schedule 8 for cases where wayleaves have not been agreed. This provides for the Secretary of State to tell the applicant that he will not proceed with the application for his consent for the line until the applicant has applied to him under Schedule 4 paragraph 5 to acquire a necessary wayleave. Alternatively, the Secretary of State may grant consent for the line but subject to the condition that work may not proceed until he gives permission as appears in Schedule 8 paragraph 6(1)(b). In deciding whether to give such permission he will take into account the extent to which the necessary wayleaves have been granted by that time. He will also ensure that permission will be given to proceed with any work on part of the line only where that can be done without prejudicing the outcome of unresolved wayleave problems on another part of the line.
It might be helpful if I point out that paragraph 5 of Schedule 4 sets out the procedure where a wayleave has not been agreed voluntarily and application for a necessary wayleave is made to the Secretary of State. Under the paragraph the Secretary of State may not grant such a necessary wayleave without affording the owners and occupiers of the land an opportunity to be heard by a person appointed by him. I hope that with that explanation the noble Lord will see fit to withdraw the amendment.
8.15 p.m.
Lord Peston: My Lords, again I than the Minister for enlightening me on what this complex schedule means. He is right that the worry my noble friend and I have will be dealt with by later clauses. I am happy to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Hooper Baroness Hooper moved Amendment No. 86.
Page 104, line 37, after ("shall,") insert ("in such circumstances as may be prescribed by the regulations or").
The noble Baroness said: My Lords, I shall speak also to a rather large group of amendments which consists of Amendments Nos. 87, 89 and 91 to 105 inclusive. They are all government amendments, with the exception of Amendments Nos. 90 and 93 tabled by the noble Lord, Lord Howie of Troon, and

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Amendment No. 95, tabled by the noble Lords, Lord Williams of Elvel and Lord Peston. I referred briefly yesterday to the package of amendments to Schedules 8 and 9 which the Government have now proposed following careful consideration of the concerns expressed to us and the consultations that we have held on the subject.
The amendment to Schedule 8 gives effect to the undertaking that I gave way back on 16th May to allow the regulations to be made under Schedule 8 to provide that an application for consent under Clauses 38 and 39 should be notified to the NCC if it relates to SSSIs or national nature reserves.
I turn to the amendments to Schedule 9. The Government have considered carefully all the environmental amendments which were tabled at an earlier stage. We have tried to have regard—if I may use those words—to the spirit of what was proposed while also bearing in mind the need for amendments capable of practical implementation.
I shall speak first to the second amendment to Schedule 9 which inserts the word "archaeological" in line 40 and takes up suggestions made in the amendments tabled by the noble Lords, Lord Williams of Elvel and Lord Peston. It is a helpful clarification.
Yesterday in response to the amendment to Clause 4 tabled by the noble Lord, Lord Williams, I undertook to take the amendment back and to return to the House on Third Reading with an amendment to the clause which would embody, so far as possible, the spirit of the amendment but which would correct its technical defects. I hope that, together with that undertaking, the Government's amendments to Schedules 8 and 9 will be seen as evidence of our wish to accommodate the main concerns of the environmental bodies, taking account of the new structure for the industry and the need to consider the practicalities of implementation. There are of course equivalent amendments to the parts of Schedule 9 affecting Scotland.
As I have reminded the House previously, the Bill's environmental provisions should not be seen in isolation. There are 15 Acts of Parliament and 14 European Community directives which bear on the industry's reaction to the environment. Taking account also of Schedule 9, as the Government now propose to amend it, the industry will be subject to explicit and strong duties. The Secretary of State will have a responsible and important role to play. I therefore commend the government amendments to the House.
I turn to Amendments Nos. 90 and 93. I am grateful to the noble Lord, Lord Howie of Troon, for suggesting the amendments, but I do not believe that any further elaboration of the already wide coverage of Schedule 9 is necessary. One of the Government's amendments to Schedule 9 will, as I have said, add the word "archaeological". That addition provides a useful clarification and, arguably, fills a gap in the chronological range of its coverage. I now consider that coverage to be comprehensive and I doubt whether any court would take the view that a burial ground or a bridge, for
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example, would slip through the net on the argument that it was neither a building nor another object.
In addition to natural features, flora and fauna, Schedule 9 now encompasses buildings and other objects of archaeological, architectural or historic interest. It is difficult to envisage a structure or feature which does not now fall within that ambit. If a structure or building is of no architectural or historic interest but of interest only to an engineer, it is perhaps not of sufficient general importance to be included within the scope of Schedule 9. Of course, if something is of interest because of its key position in the development of technology, it would also hold a specific historic interest. I hope that the noble Lord will feel able not to press his amendments for those reasons.
Similarly with Amendment No. 95, the first part is unnecessary. Under Schedule 9, as the Government propose it should be amended, there will be a duty on those seeking consents under Clause 39 to have regard to the desirability of preserving natural beauty and to do what they reasonably can to mitigate the effects of their proposals on the natural beauty of the countryside. That will necessarily involve consideration of whether lines should be put underground, if the location is a sensitive one.
Clearly the applicant must also have regard to the cost of putting a line underground, since the cost ranges from 1.5 to 18 times as expensive as overhead lines, depending on voltage. There are other considerations too, such as the greater cost of locating and rectifying faults and the risk of cables being damaged in arable fields.
That brings me to the second part of the amendment and the second reason for my being unable to accept it. If there is an objective which on the face of it seems eminently desirable but which costs money, it is a natural temptation to look to the Government to pay. However, the Government in this sense means the taxpayer. I see no logic in requiring the taxpayer to contribute to the cost of putting lines underground. Putting lines underground for environmental reasons is as much a part of the cost of supplying electricity as modifying the design or layout of a proposed power station, to make it visually more acceptable, or indeed of fitting flue gas desulphurisation equipment in order to reduce the emission of sulphur dioxide.
It is not at all clear why one should distinguish between different kinds of environmental costs and require taxpayers in some cases to contribute and in others not to do so. For these reasons, I am unable to accept the amendment, although I acknowledge the intentions behind it.
I think it would be wrong to end on a negative note. I mentioned in Committee the good work which some boards have done in this field and perhaps I can given another example, this time from South Wales. It is a pity that the noble Lord, Lord Williams, is not present to hear this. In the past three years, in order to cater for the extension of supplies, the South Wales Board installed 620 kilometres of underground cable while dismantling only 135 kilometres of underground cable. Over the same period a greater length of overhead lines was

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dismantled—that is, about 65 kilometres—than was erected. Looking at the area boards as a whole, in 1987–88 they commissioned over 6,000 kilometres of lines, of which 4,000 were underground.
I believe that we should commend the industry for doing what it is already achieving in the field and acknowledge that underground lines are already an important consideration in their operations. As a result of the amendment that we are proposing in the Bill, we believe that this will continue to be such a consideration. I beg to move.
Lord Howie of Troon: My Lords, I apologise to the House for returning to this matter so soon after we have debated the Water Bill at some length. We came to some rather unsatisfactory conclusions, but at least they were conclusions. The fault is not mine but that of the Government that the Electricity Bill followed so soon after the Water Bill.
I have been carrying out an educational process in which I have been trying to convince the Government Front Bench that engineering and architecture are not the same and not interchangeable, and that matters which are of engineering interest should not be referred to as if they were of architectural interest. They are not quite the same.
The House will know that I hold the noble Baroness, Lady Hooper, in high regard, but I must confess that my devotion trembled just for a moment when she seemed to me to say that engineering was not of great importance. I know that she did not mean quite that, but it was odd and, I think, significant that it could be said. Engineering is of great importance. There are objects, artefacts, amenities and things which are worth preserving and worth looking at, which have nothing to do with architecture at all. They are engineering objects and that is why I put "engineering interest" in my amendment.
Perhaps I may give an analogy which has nothing whatever to do with the Bill before us but which will simply and locally illustrate what I mean. The building where we are this evening is of architectural rather than engineering interest and possibly historic interest—who can tell?—although the Victoria Tower is of engineering interest because it was the first skyscraper. Waterloo Bridge is of engineering interest, not architectural interest. The only architecture in it is wholly false: it pretends to be an arch when it is actually a beam. Never mind that. I am saying that architectural interest is a good thing, it should be supported; engineering interest is something else and ought at least to be recognised in this House and by the Government.
I am only interested in Amendments Nos. 90 and 93 which are mine and Nos. 91 and 100 in the name of the noble Baroness. I know that I ought to have repeated my amendments in relation to paragraph 2, but I did not do so in order not to clutter up the Marshalled List by putting in two sets of identical amendments.
I have taken the amendment which was already accepted under the Water Bill—that is my Amendment No. 90—and added to it the words
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"structures" and "engineering" because I fancied them from my own point of view. The noble Baroness has put down an amendment which adds "historic or archaeological". If she will not go all the way with me, surely she could go at least the length of adding "sites or other objects of archaeological, architectural or historic interest". At least she could go that far; it is as far as the Water Bill has gone. It would be quite absurd if the restrictions laid upon the companies under the Water Bill were different from those laid on the companies under the Electricity Bill. To that extent I think that the noble Baroness must agree with me.
I shall now throw her a lifeline, because I am like that. In the recent Water Bill and under the Copyright Act when it was a Bill 18 months ago, we redefined the word "buildings" to include "structures". It was a lawyers' device, a typical Whitehall device, because it allowed my "structures" in without saying so in the sense of putting the word "engineering" on the face of the Bill. I should be happy if the Government would bring back my Amendment No. 90 at the next stage without the words "structures" or "engineering" and if they would also bring in an amendment which redefined "buildings" to include "structure". They would then recognise a difference between buildings and structures. That would make me happy, and I am sure they worry a little bit about that. They would also be following the precedent of the Copyright Act and the Water Bill.
I throw them this lifeline because I am by nature a kindly fellow. I see the noble Earl, Lord Dundee, sitting on the Front Bench. He was present during the debate on the Copyright Act so he will be able to explain the importance of all this and the semi-satisfactory compromise which was eventually reached. As a man who believes in compromise, I shall not press my amendments, important, useful and good though they are. However, I am willing to accept the notion that the Government could come back with something along the lines which I have indicated. I hope to receive such an assurance.
8.30 p.m.
Lord Norrie: My Lords, I shall speak to government Amendments Nos. 89, 91, 92, 94 and 96 to 105. I start by congratulating my noble friend the Minister on her commitment last night to introducing an environmental amendment to Clause 4 of the Bill on Third Reading.
The Minister knows from our almost continuous dialogue that Clause 4 had become a sticking point. It therefore came as an unexpected, though thoroughly welcome, surprise when she announced to the House that she would bring forward an amendment of her own. I thank the "green Baroness" as the noble Baroness was aptly nicknamed last night. I look forward to seeing the wording of that amendment at Third Reading. Incidentally, I hope the wording I offered in the debate last night will prove a helpful starting point.
I turn now to the amendments which the Government had previously tabled to Schedule 9. As I said yesterday, I am glad to welcome these.

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Amendments Nos. 89, 92 and 94 strengthen the operations of the environmental duty by clarifying the roles of the licence holders and the Secretary of State. The latter will have a duty to ensure that the licence holders have taken the environment into account. This is very welcome in principle, and I trust it will also bite in practice. I assume that this means that the Secretary of State will feel fully justified in refusing consent for power stations and other proposals which do not meet the criteria of this schedule, and that this will happen in practice. To the best of my knowledge such a thing has never happened in over 100 power station applications since the 1940s. I hope the Minister can reassure me that these duties are sufficiently strong and that she is confident herself that this is an entirely possible outcome. As ever, the proof of the pudding will be in the eating.
Amendment No. 90, standing in the name of the noble Lord, Lord Howie of Troon, and Amendment No. 91, standing in the name of my noble friend the Minister, make the welcome addition of archaeology to the scope of the environmental duty. This addresses a point which a number of noble Lords on this side and on the other side of the House raised during earlier discussions. I hope that my noble friend does not think I am nitpicking, but the only point I wish to make is that archaeological objects are very narrowly defined. That term suggests particular objects like burial chambers or standing stones. I believe the amendment ought ideally to refer to archaeological areas, to incorporate the site itself and its surroundings, as well as recognising the importance of historic landscapes and areas of land over which archaeological remains are scattered. I believe this is one of the points that the noble Lord, Lord Howie of Troon, is endeavouring to make.
I note, too, the extension of the duty to the changes in the operation of power stations. This will pick up new practices and changes in operating standards, and will ensure that the environmental implications of these matters are properly taken into account. I particularly welcome the new proposed environmental statements which must be approved by the Nature Conservancy Council and the Countryside Commission and which will apply to all licence holders.
The new Schedule 9 will, if accepted by the House, be a considerable improvement on the old one. However, I must register a small twinge of regret that the Government have not been able to beef up the words "have regard to" when mentioning the environment. I still believe these words to be less than ideal. Nor have the Government been able to incorporate a reference to energy conservation in this schedule, in acknowledgement of the key role which energy conservation plays in fulfilling environmental objectives. I hope, however, that one effect of the Government's amendment to Clause 4 will be to emphasise the importance of energy efficiency and conservation in meeting environmental objectives.
Having said that, I welcome the Government's proposals. I believe that in conjunction with the very welcome promise by my noble friend the Minister,
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made in relation to Clause 4 last night, we have a Bill that has become a very much better Bill for the environment than it was when we received it a few weeks go.
Lord Peston: My Lords, I, too, certainly wish to congratulate the noble Baroness on bringing in these most welcome amendments. I think she has gone a considerable way to meet the concerns of those in your Lordships' House who have worried about these matters. I refer not only to noble Lords but also to interested people outside. Therefore, I hope the noble Baroness will not think me churlish if I add one or two critical remarks, and also at least speak to my own amendment and say why I still think it is a good amendment. However, I do not wish the noble Baroness to misunderstand my remarks. I think she has done a great deal as regards moving in the right direction.
Before I speak to my own amendment, I wish to say a few words on Amendment No. 90, standing in the name of my noble friend Lord Howie of Troon. I support that amendment very strongly, for precisely the reasons that my noble friend supports it. I have underlined in particular the word "engineering". In this country we tend to underestimate the value of what one might almost call engineering antiquity as regards certain buildings, sites and structures. I am not referring now to the standard piece of British manufacturing industry which some of us tend to regard as an example of archaeology anyway, but, more seriously, our successors will wonder why very little is preserved so they can see the real thing rather than pictures.
I think my noble friend is right to emphasise engineering in particular. My noble friend was looking for a compromise, but I wonder whether there may be a verbal way out. We have included the word "archaeology", but there is a very well-defined discipline nowadays called "industrial archaeology". The noble Baroness may feel able to tell us that the term "archaeology" subsumes all forms of archaeology, including industrial archaeology. If that term includes industrial archaeology, it meets the engineering point, at least to some degree. I should prefer to have the word "engineering", but the term "archaeology" may include that. I wish to draw your Lordships' attention, although I know this is not necessary, to the fact that part of our history is a history of engineering structures and objects and it is well worth preserving to some degree.
Amendment No. 95 is included in this grouping, although there are so many amendments it is difficult to keep track of them. The amendment which my noble friend Lord Williams of Elvel and the noble Lord, Lord Ezra, have put down does somewhat bring out the difference between the two sides of your Lordships' House. I join with the noble Baroness in commending the industry. In saying that environmental matters must be considered, none of us is saying that the industry is totally uninterested in the environment. If for no other reason than good public relations, or, less cynically, as good citizens, the people in the industry will want to take the environment into account to some degree. The

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example that the noble Baroness mentioned was a very good instance of that.
Let us assume that the industry will do a certain amount in this regard. The industry has done that in the past, and I see no reason why it should not continue to do so. Let us assume that the argument will be put forward with respect to national parks, areas of outstanding natural beauty and conservation areas that more lines ought to go underground.
There can be no doubt that what we are discussing here will involve expenses. There is no argument as regards that process involving costs. However, the point we are making is that it is reasonable that the Secretary of State, in representing public opinion, might on some occasions say that he would like to have more of the lines running underground because that is what the public wants. It is by no means obvious to me that the Secretary of State, in representing that opinion in the national interest, should ask the industry to meet the cost of that operation when the industry has done what it feels it can do in that regard. We feel it would be unreasonable of him to ask the industry to meet the cost.
Further, it is not obvious to me that the industry's consumers, as it were, should meet the cost. If we are talking about something that affects the general state of the environment, the exact word that the noble Baroness used applies. She talked about the taxpayer. We are talking about the taxpayer meeting the cost of something which is in the national interest. From Adam Smith to the present day, the fundamental proposition of taxation is that we tax in order to pay for things which are in the national interest. That is why we have a tax system in the first place.
We disagree with the noble Baroness, not in saying that no attention will be paid to the environment by the industry; but we believe that it would be reasonable for the Secretary of State to intervene on such occasions to say that, for very good reasons, he would like more line to go underground. However, we believe that the industry should then be able to say that if such a procedure is in the national interest the nation must pay for it. That is what our amendment states.
From the way the noble Baroness has spoken she will not agree with what I have said. However, she ought to know that there is a very strong logical case, which has a pedigree of at least 200 years, explaining why one would use the tax system to finance matters of national interest, of which this is one.
Lord Renton: My Lords, I must apologise for not having been present when my noble friend Baroness Hooper moved the amendments. I welcome them, especially those which amend Schedule 9. I cannot refrain from being nostalgic because paragraph 1 of Schedule 9 is taken word for word from Section 37 of the 1957 Act. That is a section which I moved at the Report stage in another place in that year. I am glad to see that the concept which we put forward then has stood the test of time and is now being embellished and strengthened.
I particularly welcome Amendment No. 103. I should point out that that fastens responsibility upon
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the Secretary of State for ensuring that the environmental provisions are properly applied by those concerned and gives him certain powers if they are not properly applied. That is a very important way of strengthening the protection for the environment.
Baroness Hooper: My Lords, I am most grateful for the welcome which has generally been given to the government amendments. I have noted the criticisms that have also been advanced, and am happy to note that they are very few. Many of them have been answered in previous debates and so I shall not respond specifically. However, it is my understanding that archaeology includes industrial archaeology, and that "historic" covers engineering history. As I said earlier, I believe that the situation is covered. Nevertheless, it would be churlish of me to refuse the lifeline thrown out by the noble Lord, Lord Howie of Troon. In view of the wide scope of the amendments which we have already conceded, I shall consider whether there is any way in which we can take his arguments into account.
On Question, amendment agreed to.
8.45 p.m.
Baroness Hooper Baroness Hooper moved Amendment No. 87:
Page 104, line 38, after second ("be") insert ("so prescribed or, as the case may be,").
On Question, amendment agreed to.
Clause 39 [Consent required for overhead lines]:
[Amendment No. 88 not moved.]
Schedule 9 [Preservation of amenity and fisheries]:
Baroness Hooper: My Lords, I should like to move Amendments Nos. 89 to 92 en bloc.
The Deputy Speaker (Lord Grantchester): The noble Baroness cannot do so.
Baroness Hooper Baroness Hooper moved Amendment No. 89:
Page 107, line 34, leave out from ("formulating") to end of line 36 and insert ("any relevant proposals, a licence holder or a person authorised by an exemption to generate or supply electricity").
On Question, amendment agreed to.
The Deputy Speaker: My Lords, if Amendment No. 90 is agreed to, I cannot call Amendment No. 91.
Lord Howie of Troon Lord Howie of Troon had given in notice of his intention to move Amendment No. 90:
Page 107, line 39, leave out from ("buildings") to ("and") in line 40 and insert ("structures, sites or other objects of archaeological, architectural, engineering or historic interest;").
The noble Lord said: My Lords, I wish the noble Baroness had moved the amendments en bloc. It seemed a very good idea at the time. However, I can see why she did not do so.
I greatly appreciate her reception of my comments. However, archaeology does not include industrial archaeology. I leave it at that. The noble Baroness said, as has been said to me before, that history would include the history of engineering. I must

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remind the House that the Bill includes architecture. History would include architecture. It is not proper to separate architecture from the history of architecture and yet assume that history includes the history of engineering. What is good enough for the architect ought to be good enough for the engineer. Having said that, I shall not move Amendment No. 90 or Amendment No. 93 when the time comes. However, I hope that the Government Front Bench will pay close attention to what I have said and come back at Third Reading with something that is mid-way between our two positions. I doubt whether it will be nearer my position than theirs, but I shall be content with something in between.
[Amendment No. 90 not moved.)
Baroness Hooper Baroness Hooper moved Amendments Nos. 91 and 92:
Page 107, line 40, leave out ("or historic") and insert ("historic or archaeological").
Page 107, line 41, leave out ("take into account") and insert ("do what he reasonably can to mitigate").
On Question, amendments agreed to.
[Amendment No. 93 not moved.]
Baroness Hooper Baroness Hooper moved Amendment No. 94:
Page 107, line 43, at end insert—
("(1A) In considering any relevant proposals for which his consent is required under section 38 or 39 of this Act, the Secretary of State shall have regard to—

(a) the desirability of the matters mentioned in paragraph (a) of sub-paragraph (1) above; and

(b) the extent to which the person by whom the proposals were formulated has complied with his duty under paragraph (b) of that sub-paragraph,").

On Question, amendment agreed to.
[Amendment No. 95 not moved.]
Baroness Hooper Baroness Hooper moved Amendments Nos. 96 to 105:
Page 107, line 45, leave out from beginning to end of line 6 on page 108 and insert ("means any proposals—

(a) for the construction or extension of a generating station of a capacity not less than 10 megawatts, or for the operation of such a station in a different manner;

(b) for the installation (whether above or below ground) of an electric line; or

(c) for the execution of any other works for or in connection with the transmission or supply of electricity.").

Page 108, line 10, leave out ("extends") and insert ("and paragraph 1A below extend").
Page 108, line 10, at end insert—
("1A.—(1) A licence holder shall within twelve months from the grant of his licence prepare, and from time to time modify, a statement setting out the manner in which he proposes to perform his duty under paragraph 1(1) above, including in particular the consultation procedures which he intends to follow.
(2) Before preparing or modifying a statement under this paragraph, a licence holder shall consult with the Countryside Commission, the Nature Conservency Council and—

(a) where the activities which he is authorised by his licence to carry on include activities in England, the Historic Buildings and Monuments Commission for England; and

(b) where those activities include activities in Wales, the Historic Buildings Council for Wales.

(3) As soon as practicable after preparing or modifying a statement under this paragraph, the licence holder shall publish
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the statement as so prepared or so modifed in such manner as he considers appropriate.").
Page 108, line 12, leave out from ("formulating") to end of line 15 and insert ("any relevant proposals, a licence holder or a person authorised by an exemption to generate or supply electricity").
Page 108, line 19, leave out ("or historic") and insert ("historic or archaeological").
Page 108, line 19, at end insert ("and").
Page 108, line 20, leave out ("take into account") and insert ("do what he reasonably can to mitigate").
Page 108, line 22, leave out from ("objects") to ("shall") in line 23 and insert—
("(1A) In considering any relevant proposals for which his consent is required under section 38 or 39 of this Act, the Secretary of State shall have regard to—

(a) the desirability of the matters mentioned in paragraph (a) of sub-paragraph (1) above; and

(b) the extent to which the person by whom the proposals were formulated has complied with his duty under paragraph (b) of that sub-paragraph.

(1B) Without prejudice to sub-paragraphs (1) and (1A) above, in exercising any relevant functions each of the following, namely, a licence holder, a person authorised by an exemption to generate or supply electricity and the Secretary of State").
Page 108, line 33, leave out ("paragraph 3") and insert ("paragraphs 2A and 3").
Page 108, line 33, at end insert—
("2A.—(1) A licence holder shall within twelve months from the grant of his licence prepare, and from time to time modify, a statement setting out the manner in which he proposes to perform his duty under paragraph 2(1) above, including in particular the consultation procedures which he intends to follow.
(2) Before preparing or modifying a statement under this paragraph, a licence holder shall consult with the Countryside Commission for Scotland, the Nature Conservancy Council, the Ancient Monuments Board for Scotland and the Historic Buildings Council for Scotland.
(3) As soon as practicable after preparing or modifying a statement under this paragraph, the licence holder shall publish the statement as so prepared or so modified in such manner as he considers appropriate.").
On Question, amendments agreed to.
The Deputy Speaker: My Lords, I should have pointed out that there is a printing error in the Marshalled List concerning Amendment No. 105. "Nature Conservancy Commission" should read "Nature Conservancy Council".
Clause 41 [Standards of performance in individual cases]:
The Earl of Dundee The Earl of Dundee moved Amendment No. 106:
Page 32, line 17, leave out ("domestic premises") and insert ("tariff customers").
The noble Earl said: My Lords, with the leave of the House, I shall also speak to Amendment No. 108. In Committee we undertook to consider the amendments proposed by the noble Lord, Lord Campbell of Croy, the noble Lord, Lord Ezra, and the noble Viscount, Lord Hanworth, to widen the application of the guaranteed standards scheme which the director will create under Clause 41 of the Bill.
It has always been the Government's intention that the new system of compensation for consumers when a public electricity supplier fails to meet guaranteed standards of service should apply to those customers who may not be able to benefit directly from the choice of supplier which larger business

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consumers may expect to enjoy after privatisation. We intend that those consumers who will be faced with a single monopoly supplier for the foreseeable future should have the additional protection of guaranteed standards of performance from their supplier.
The majority of consumers who fall into this category will of course be domestic consumers, and indeed the Government's primary aim has always been that it is primarily the householder who should benefit from the new rights. However, we have considerable sympathy with the view, expressed in many quarters, that there may be categories of customer who, although not qualifying as domestic customers, will nonetheless find themselves restricted for all practical purposes to a single supplier—for example, small business customers and farmers. The amendment before the House therefore provides that such categories of consumer may be included within the scope of the guaranteed standards scheme.
I am sure that noble Lords will agree that the amendment meets the concerns that they have expressed. I commend it to the House. I beg to move.
On Question, amendment agreed to.
Baroness Oppenheim-Barnes Baroness Oppenheim-Barnes moved Amendment No. 107:
Page 32, line 18, at end insert—
("( ) Without prejudice to the generality of sub-section 1 above, in making regulations under this section the Director shall have regard to the following aspects of service quality:

(a) the maximum number, if any of unplanned or planned interruptions of electricity supply;

(b) the maximum duration of any interruptions permitted under (a) above;

(c) the minimum notice required for planned interruptions of supply;

(d) the maximum variation allowable in voltage and frequence of supply, including transient variations;

(e) the maximum time allowable for the connection of new customers to an existing supply; and

(f) the restoration of a supply to customers where the supply has been terminated in error.").

The noble Baroness said: My Lords, some aspects of the quality of electricity are covered in other parts of the Bill. This amendment adds a new subsection to Clause 41 which gives the director powers to define standards which would, if breached, automatically trigger the compensation that is already provided for in subsection (3) of Clause 41. That subsection allows compensation for failure to meet individual standards.
The new subsection defines those standards. They cover a number of things which are obvious in the amendment, for example, interruption of supply and minimum notice required for planned interruption of supply. Many noble Lords will know of examples of consumers who have perhaps gone away at Christmas and not received a notification that there will be an interruption of supply. Their pipes have been frozen, serious damage has occurred to their homes and they have not had any compensation as a result.
There are a number of other definitions here, including the maximum duration of interruption and the restoration of supply when termination has occurred by error or by accident. All of those things come within the power of the director. He may define them. This is a purely permissive amendment but, in giving him those powers, it also gives consumers the opportunity to obtain automatic compensation and redress in those circumstances.
In allowing the director to define the causes for compensation, it would greatly facilitate all methods of redress. The measure is long overdue. Under the present system consumers have suffered for many years from disconnections and other matters that are due to negligence, and they have not been compensated. They will benefit and the whole industry will benefit because it discourage negligence. It will make people more careful—dare I say it?—about their engineering as well as about other matters and will thus raise standards throughout. I hope that that will therefore commend it to my noble friend the Minister.
The Earl of Dundee: My Lords, am grateful to my noble friend for drawing attention to the importance of Clause 41.
The making of regulations under this clause, prescribing guaranteed standards of service, will be a matter for the Director General of Electricity Supply. We do not feel that it would be right to restrict his discretion by setting out in advance precisely what he should or should not include in these regulations. The Bill already provides for a thorough consultation process in that the director will be required to consult the public electricity suppliers and persons and bodies representative of the consumer before making regulations under the clause. He will also need to seek the consent of the Secretary of State to the regulations that he proposes to make.
My noble friend seeks to ensure that the regulations will cover a range of specific areas of service quality. I should first make it clear that many of those areas may indeed feature in the regulations that the director will eventually make. Naturally, the question of whether they should cover matters already dealt with by other provisions in the Bill, licences or the supply regulations, is one that the director will wish to consider. However, as I have made clear, the Government wish neither to restrict his decisions in advance, nor to pre-empt the consultation process to which I have alluded.
Nonetheless, I understand my noble friend's concern. It might therefore be helpful if I dealt with each of these in turn, so that she is not under the impression that the Government feel that they are unimportant.
With regard to the maximum number and maximum duration of unplanned or planned interruptions of electricity supply, I must say that I do not think that what is suggested would be suitable in the form it is drafted for individual standards of performance. This sounds rather more like an area that the director might wish to consider for the standards of overall performance to be set up under Clause 42. I must say, however, that I could foresee

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practical difficulties in forecasting unplanned interruptions which, by their very nature, must be difficult to plan for.
Turning to the notice required for planned interruptions of supply and the maximum variation allowable in voltage and frequency of supply, both those areas are covered by the electricity supply regulations. Breach of those regulations constitutes a criminal offence and the consumer is therefore well protected in that area.
Turning to the maximum time allowable for the connection of new customers to an existing supply, I must say that I think it would be difficult to make such a prescription, given the variations which will inevitably occur in individual circumstances.
In any case the Bill already provides a remedy in that area. Under Clause 18, a customer requiring a supply may specify the day on which the supply is to commence. If the supplier nominates an alternative date, which is not acceptable to the customer, then the matter can be referred to the director for the exercise of his powers to determine disputes under Clause 25. Any failure to meet the determined timescale would be a breach of the obligation under Clause 18 and, accordingly, a matter for the director's enforcement powers.
Finally, the restoration of a supply terminated in error is already covered by the more general obligation to provide a supply.
I hope that I have demonstrated that the Government take those areas of supply service seriously. As I have also indicated, the director will be free to deal with those or similar areas when making his regulations. I do not think that it is necessary or desirable to list such areas in the Bill. I hope that in the light of what I have said my noble friend might feel able not to press her amendment.
Baroness Oppenheim-Barnes: My Lords, my noble friend the Minister has given a full and thoughtful answer for which I am extremely grateful. I shall study it carefully in relation to those parts of the Bill which he mentioned and which, obviously, one has not had time to study at this moment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Dundee The Earl of Dundee moved Amendment No. 108:
Page 33. leave out lines 6 and 7.
On Question, amendment agreed to.
Clause 43 [Information with respect to levels of performance]:
Lord Williams of Elvel Lord Williams of Elvel moved Amendment No. 109:
Page 33, line 19, leave out ("from time to time") and insert ("regularly").
The noble Lord said: My Lords, we are dealing here with the duties of a director to collect information. The expression in the Bill as drafted is "from time to time". That seems to us to be an expression which may extend to a period of weeks, months or years. A regular collection of information
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would be the right formula. This is not an amendment of great significance, but I believe that it is something to which the Government should pay attention. I beg to move.
Lord Renton: My Lords, I am not sure that the noble Lord's amendment serves his purpose because "regularly" could mean, for example, one a year and "from time to time" could mean four or five times in the course of a year, but at irregular intervals. I am not sure which way he would rather have it.
Lord Williams of Elvel: My Lords, the phrase "from time to time" could mean every five years.
The Earl of Dundee: My Lords, I am grateful to the noble Lord, Lord Williams, for putting forward his amendment. Under Clause 43(2) the public electricity suppliers are required to provide the director with specific information once a year about the number of cases in which compensation has been made under Clause 41, the aggregate value of that compensation and such information as the director may require about the overall performance achieved in respect of each standard determined under Clause 42.
Your Lordships may be concerned that the director will not publish information on a regular basis.
Lord Williams of Elvel: My Lords, what is "regular"?
The Earl of Dundee: My Lords, if the noble Lord will be patient for a moment I shall come to the all-important distinction between "regular" and "from time to time". I shall take my time about it.
I should draw your Lordships' attention to Clause 43(4) which provides that the director must arrange for the publication of the information at least once a year. I am sure that your Lordships will agree that it is the publication of the information, not its collection, which is important; it really makes no difference at all to customers whether the director collects the information "regularly" or "from time to time" provided that the information is published at least once a year.
9 p.m.
Lord Williams of Elvel: My Lords, before the noble Earl sits down, obviously it does not make a great deal of difference. If the information is collected from time to time it could be wildly out of date when the director makes his regular report.
The Earl of Dundee: The director, my Lords, is required to publish the information at least once in every year, so that customers or potential customers will be aware of their suppliers' performance. In this way, the consumer will be provided with information, as never before, about his local electricity supplier and will know that there are pressures operating on him to improve his performance. And the supplier will seek to improve his performance in competition with the other suppliers.

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Taking the difference between collection and publication, there is a duty to report to the director at least once a year. If there is that duty and there is also a duty imposed on the director to publish once a year, I do not think that it matters whether the collection is at a regular interval or from time to time. The relevant consideration is that the publication occurs. That publication cannot be neglected by the director and it has to occur at least once a year.
Lord Williams of Elvel: My Lords, I hope that the noble Earl will look carefully at what has been said in this discussion. It seems to me odd that the director should from time to time collect information which he shall then publish regularly. He can from time to time collect information and by the time he regularly publishes it it may be wildly out of date.
Again, this is not a very important factor but perhaps the noble Earl will write to me about it. I shall enjoy reading whatever he does write.
The Earl of Dundee: My Lords, I always look at everything that the noble Lord, Lord Williams, says in a very regular way, not just from time to time.
Lord Williams of Elvel: My Lords, I am very grateful to the noble Earl. He has a very regular mind and not a mind that functions from time to time. I hope that in the context he will explain to me how this will operate. If the director is to report regularly, he has to collect information regularly; otherwise he will have out-of-date information on which he is reporting. However, in the light of the noble Earl's time to time response I beg leave to withdraw the amendment.
Amendment, by leave withdrawn.
Lord Williams of Elvel Lord Williams of Elvel moved Amendment No. 110:
Page 33, line 23, leave out ("overall").
The noble Lord said: My Lords, in moving this amendment which stands in my name and that of the noble Lord, Lord Peston, it may be for the convenience of the House if I also speak to Amendment No. 111. Again, this is a probing amendment. I am quite uncertain about the meaning of "overall" in this context. I beg to move.
The Earl of Dundee: My Lords, this clause and Clauses 41 and 42 need to be seen as a whole. Clause 43 provides for the director to collect and publish information about the compensation in respect of standards of performance in individual cases under Clause 41 and the levels of overall performance achieved under Clause 42.
The word "overall" as used in Clauses 42 and 43 simply distinguishes the Clause 41 standards from the Clause 42 standards. The former will relate to the service experienced by individual consumers. By contrast the Clause 42 standards will provide indicators of the supply companies' overall performance and might include, for example, the
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expectation that the supply companies would respond to 100 per cent. of certain types of written inquiry within a set number of days, or that 95 per cent. of certain types of supply failure should be dealt with within a set period of time.
This category of standard is complementary to, but distinct from, the guaranteed standards of service to be set by the director under Clause 41. It will be up to the director which aspects of customer service it is appropriate to deal with in each of the two schemes, and there is no reason why there should not be some areas which are dealt with under both schemes.
The guaranteed standard scheme and the standards of overall performance will deal with different aspects of the supply company's performance. I hope that in the light of that further explanation the noble Lord will feel able to withdraw the amendment.
Lord Williams of Elvel: My Lords, as always I am grateful to the noble Earl. However, I did not receive an answer to my question: what does 'overall" really mean? He said that there will be standards of overall performance. What are those standards? What are the standards to be set? I do not wish to pursue this argument but if the noble Earl could help me a little as to what "overall" means, I should be more than grateful.
Lord Renton: My Lords, I hope it is in order for me to intervene at this stage. I think that the noble Lord, Lord Williams, is on to a point which requires explanation. If it cannot be given today, I hope that perhaps it might be given at Third Reading.
The Earl of Dundee: My Lords, the noble Lord asked me perhaps to be more precise in defining "overall". I think that the best way in which I can define it is to say that it does not mean individual.
Lord Williams of Elvel: My Lords, I express my gratitude for the noble Earl's overall performance but I am no further on than I was when we started this debate. I hope that he will take up the suggestion of his noble friend Lord Renton and perhaps I may receive another letter from the noble Earl explaining what the Government mean by "overall". If we do not like it, perhaps we shall return to it at Third Reading.
The Earl of Dundee: My Lords, of course it is always important through the lengthy discussions that we are having on this long Bill to be absolutely sure that we are all informed in the way that we should like to be informed. I shall be very happy to write to the noble Earl about this matter.
Lord Williams of Elvel: My Lords, I am most grateful. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 111 not moved.]
Clause 44 [Functions with respect to competition]:
Lord Williams of Elvel Lord Williams of Elvel moved Amendment No. 112:
Page 34, line 12, after ("Act") insert ("jointly with the Director").
The noble Lord said: My Lords, this amendment stands in my name and that of the noble Lord, Lord Peston. It may be for the convenience of the House if I also speak to Amendments Nos. 113 and 114.
We are dealing here with the function with regard to competition. The Director General of Fair Trading, as I understand it, has a role and the director in the terms of the Bill also has a role. The Fair Trading Act lays down the rules under which the Director General of Fair Trading operates. It would be detrimental to the concept of competition policy if there were to be any serious derogation of the rights of the Director General of Fair Trading simply because there is something written into a Bill that deals with a particular industry.
The Director General of Fair Trading has a writ which runs right across industry. The amendment I am moving and those to which I am speaking try to ensure that the role of the Director General of Fair Trading is properly respected in that he is, under the Fair Trading Act, the person who initiates action on anti-competitive issues.
I would hate it if the Government were to say "The Director General of Fair Trading can in some way not be involved", or in some way can be side-tracked in competition issues of this nature. It is for that reason that I beg to move the amendment.
Lord Sanderson of Bowden: My Lords, under Clause 44 the Director General of Electricity Supply and the Director General of Fair Trading will exercise powers concurrently—the point about which we have to talk is the meaning of concurrent and joint—in relation to electricity, and certain of the latter's functions under the monopoly provisions of the Fair Trading Act 1973, and the anticompetitive practice provisions of the Competition Act 1980. One director or the other will need to take the lead role depending on the nature of the case at issue. Broadly, the Government envisage that if the case turns primarily on the generation, transmission or supply of electricity the DGES would normally take the lead whereas the DGFT would do so if the case concerned more than that one industry or market.
The Bill cannot anticipate where the balance will lie in any particular case. That is why it provides for concurrent jurisdiction and for consultation between the two directors before either exercises that jurisdiction. The two directors will be able to decide the best practical approach in the light of these broad principles and the circumstances of the individual case.
Perhaps I can give examples which might help the noble Lord. The Director General of Electricity Supply would normally take the lead only where the case primarily concerned the performance of the electricity industry alone. If, for example, a licensee engaged in predatory pricing practices which distorted competition in some part of the electricity
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market, the director could take action under competition law if he felt that a more appropriate route in the circumstances than the licence enforcement and modification procedures. On the other hand, the DGFT might take the lead where the case concerned more than one, or a separate, industry or market. If, for example, a supplier engaged in anti-competitive pricing practices with regard to the sale of electric household appliances, that might be a case where the DGFT could be expected to take the lead role.
These are perhaps simple examples. It will not always be clear which director should take the lead. That is why this clause provides for consultation between the two directors before either exercises his power. The two directors will be able together to decide the best approach in the light of the broad principles which I have outlined.
Perhaps I may say to the noble Lord, Lord Williams of Elvel, that certainly the Fair Trading Act 1973 and the powers of the DGFT are in no way cut down by the provisions in this Bill.
Baroness Oppenheim-Barnes: My Lords, perhaps I may correct a mistaken impression given inadvertently by the noble Lord, Lord Williams of Elvel. The Director General of Fair Trading has no power to do anything in relation to a public sector industry. It is only after the passage of this Bill that the Director General of Fair Trading will be able to intervene for the first time. He was able to intervene to a limited extent if references were made under the Competition Act. I should like to clarify that point.
Lord Williams of Elvel: My Lords, I am always grateful to the noble Baroness, Lady Oppenheim-Barnes, for instructing me on the duties of the Director General of Fair Trading. The fact is that we are dealing with a Bill which is privatising companies and we are discussing what will happen post-privatisation. I made no assertions at all about what the director general can or cannot do under existing circumstances. He is governed by the 1973 Act which is complemented by the 1980 Act.
Turning to the amendment which the noble Lord and I were discussing, it seems odd that there should be a joint or concurrent responsibility and not merely a clear responsibility for the Director General of Fair Trading. As I understand it, and as the noble Lord has explained, the Bill arrogates to the director a right to exercise competition or to institute competition policies. In some way he is involved in what is properly the right of the Director General of Fair Trading.
I find that a curious construction. Perhaps the construction is sensible but I have yet to understand how that is so. As far as I know the provision does not appear in the British Telecom privatisation Act. It does not appear in the Gas Act, unless the noble Lord can point me to those sections in which the Director General of Fair Trading has a joint or concurrent responsibility with Ofgas. As far as I know it does not operate in British Steel. I am interested to note that it has suddenly appeared in this Bill. I shall be happier if the noble Lord can help.
9.15 p.m.
Lord Sanderson of Bowden: My Lords, with the leave of the House, I say with respect that the noble Lord's amendment seeks to insert the word "jointly" in place of the word "concurrently" and that that is the issue which concerns him. Our understanding of the word "jointly" is that everything is done jointly—as Siamese twins, for instance—in respect of every single issue which arises. We believe that the word "concurrent" allows each to take the lead in the area in which he has responsibility. However, in no way does that infringe or impinge on the power of the Director General of Fair Trading in relation to the Act.
I do not believe that there is anything between us as regards what we are trying to achieve in the rights of the Director General of Fair Trading. However, we believe that in this context the word "concurrent" is much better than the word "jointly". We do not want any matter to fall down between the two; nor do we want them to do everything as though they were Siamese twins.
Lord Williams of Elvel: My Lords, I am grateful to the noble Lord. The expression "jointly" means that either side has a veto on what happens. That preserves the authority of the Director General of Fair Trading. Ultimately he will decide whether jointly such and such an action is to be taken. The word "concurrently" means that at a certain point in time things happen. Nevertheless, we have had an interesting debate. I am sure that the noble Lord will read what has been said, as will I. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 113 and 114 not moved.]
Clause 45 [Fixing of maximum charges for reselling electricity]:
[Amendment No. 115 not moved.]
Clause 48 [General functions]:
Baroness Hooper Baroness Hooper moved Amendment No. 116:
Page 37, line 5, leave out from ("activities") to second ("and") in line 6 and insert ("to which this subsection applies").
The noble Baroness said: My Lords, I should like also to speak to Amendments Nos. 118 and 119. Yesterday we discussed combined heat and power and touched upon the government Amendments Nos. 116 and 118. The purpose of the two amendments is to ensure that, in carrying out his functions to keep under review the carrying on both in Great Britain and elsewhere of activities connected with the generation, transmission and supply of electricity, the director should also keep under review in particular activities connected with the supply to any premises of heat produced in association with electricity and steam produced from, and air and water heated by, such heat. I understand that that is the correct description of the process known as CHP. I understand that these amendments are reasonably welcome.
I now turn to Amendment No. 119. In this respect, I have no difficulty in agreeing with the intention behind this amendment. However, there are two practical difficulties created by it.
First, it refers specifically to activities which have the effect of increasing the overall efficiency of power stations. But measures which increase the output of electricity from a given amount of fuel may not be compatible with increasing the overall efficiency with which fuel is burnt. The operation of CHP plant is a case in point. Some efficiency of electrical output has to be sacrificed in order for there to be a constant and marketable supply of heat. Thus, the efficiency of power generation may be lower; but of course the CHP plant has greatly increased the efficiency of fuel use. The amendment could therefore give rise to confusion on behalf of the director. It may, unintentionally, give CHP a lower priority than electricity generation pure and simple. I am sure this is not what is intended by the movers of the amendment.
Secondly, the director is already under a primary duty in Clause 4 to promote competition in the generation of electricity. In discharging that duty he will have to take account of the efficiency of different power stations and the different ways in which electricity can be produced. The more efficient stations will naturally be the more competitive. And those which make the best use overall of the way fuel is burnt—for example, through CHP—will be at a considerable competitive advantage.
I hope therefore that the House will accept that this amendment, though well intended, might set back rather than advance the cause of CHP. I beg to move Amendment No. 116.
Lord Williams of Elvel: My Lords, I am in some confusion about the amendments which we are discussing. The noble Baroness moved Amendment No. 116. She has also spoken to Amendment No. 118 and to an amendment tabled by the noble Lord, Lord Ezra, the noble Earl, Lord Lauderdale, and myself, which is an amendment to Amendment No. 118. I ask for guidance from the noble Lord on the Woolsack. Are we discussing the whole lot together, are we to move Amendment No. 119, or how are we to treat this matter?
The Deputy Speaker (Lord Strabolgi): My Lords, the noble Baroness, as I understood her, was merely speaking to Amendments Nos. 118 and 119. What I was intending to do was having called Amendment No. 118, the noble Baroness having put it, I would then put the Question. Then I was going to immediately call Amendment No. 119 in the name of the noble Lord, Lord Williams.
Lord Williams of Elvel: My Lords, in that case, if the House agrees, we should speak to Amendment No. 119 as an amendment to Amendment No. 118 although the noble Baroness has only moved Amendment No. 116. She has anticipated the arguments which were to be put forward in support of Amendment No. 119. Am I correct in my assumption?
The Deputy Speaker: My Lords, noble Lords are entitled to speak to any amendments they wish, but they are only allowed to move one at a time.
Lord Renton: My Lords, assuming that we are taking Amendments Nos. 116, 118 and 119 together for discussion, although they may have to be moved separately—and we know that they do—I wonder whether, without causing him any embarrassment and without trying myself to seem the least bit clever, I should invite the attention of the noble Lord, Lord Williams of Elvel, to the fact that in Amendment No. 119 he refers to the:
"overall efficiency of power stations",
having complained quite recently of the use by the Government two pages earlier of the expression "of overall performance", which, I must say, puzzled me a little.
Lord Williams of Elvel: My Lords, I am grateful to the noble Lord for pointing that out. The amendment was drafted by the noble Lord, Lord Ezra, whose name appears at its head. The noble Earl, Lord Lauderdale, who alas is not in his place, and I simply supported the amendment without going into the complications of what "overall" might mean.
Lord Renton: My Lords, if we are to accept the amendment of the noble Lord, Lord Williams, it is important that we should know the implication of the use of the word "overall" in relation to the efficiency of power stations. Does it mean the efficiency of all power stations throughout the country, or of all power stations to which this clause refers? What is the difference between "efficiency" and "overall efficiency"?
Lord Bonham-Carter: My Lords, in the absence of my noble friend Lord Ezra I feel that I must elucidate. As I am not in the difficulty of the noble Lord, Lord Williams, in defining the word "overall". I can perhaps have a shot at it without offending anybody. Perhaps I shall also be able to help the Minister in answering the question asked by the noble Lord, Lord Williams of Elvel. It is self-evident to anyone but a lawyer what is meant by "overall" in this respect. It means the efficiency of power stations in general and in particular. That is what the amendment is intended to convey.
Lord Renton: My Lords, before the noble Lord sits down, perhaps I may point out to him that referring to power stations in the plural inevitably means that we are not referring to particular power stations but to power stations in general.
Lord Peston: My Lords, it is with some trepidation that I join this debate. I had better ensure that we are talking about Amendments Nos. 116, 118 and 119. I have no problem with Amendment No.116. I believe that Amendment No. 118 is intended to take us on with combined heat and power and is meant to be the Government's response to pleas in that direction. I hope that I am right in that assumption. The only minor matter between us concerns Amendment No. 119. My name is not attached to
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it, and I therefore have no responsibility for the wording.
I had assumed that this was an elucidatory amendment to point out that we wanted to interpret the contribution in terms of system efficiency. What matters is the explicit recognition by the Government of combined heat and power as being the relevant matter, a point made yesterday by the noble Lord, Lord Ezra, which I strongly supported. If we ignore the precise wording of the amendment—I shall not add to the insults to lawyers—I believe that a clarification of this kind might be helpful. However, that is not the central issue. What is important is to welcome the Government's recognition of the contribution of this kind of technology in this area.
On Question, amendment agreed to.
9.30 p.m.
Lord Peyton of Yeovil Lord Peyton of Yeovil moved Amendment No. 117:
Page 37, line 8, leave out from ("on") to end of line 11.
The noble Lord said: My Lords, in asking your Lordships to look at this amendment I begin by saying that I am full of genuine sympathy for Professor Littlechild, who will doubtless be scanning this Bill night after night in order to understand clearly what his duties will be. Clause 48(1) states,
"It shall be the duty of the Director, so far as it appears to him practicable from time to time to do so—

(a) to keep under review the carrying on both in Great Britain and elsewhere of activities …

(b) to collect information with respect to those activities, and the persons by whom they are carried on"—

I daresay that so far those words will have been of use and guidance to Professor Littlechild. He will then continue, looking at these words,
"with a view to his becoming aware of, and ascertaining the circumstances relating to, matters with respect to which any of his functions under this Part are exercisable".
I wonder when your Lordships' House will reach the conclusion that somewhere, sometime and somehow, there must be a limit to the amount of rubbish that is allowed to creep on to the statute book with the authority of your Lordships. After the minor exhilaration and shock that I experienced last night when the Government accepted one of my amendments, I do not entirely despair that they might even see fit, in their own interests and not to gratify any passing whim of mine, to omit these meaningless and useless words.
On the other hand, if one of my noble friends is able to rise to her or to his feet, whichever may be appropriate, and say that these words have proved to be of immense value to Professor Littlechild in facing his onerous duties, then I shall happily withdraw the amendment and apologise for having moved it. I beg to move.
Lord Renton: My Lords, whether my noble friend withdraws the amendment or not, I hope that he will not apologise for having moved it. I believe he has done a valuable service in doing so and I support him. When we enact laws we assume that they are laws that have to be obeyed and that can be enforced. I do not know how we can ever be sure. I did not

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know of this gentleman's name until my noble friend mentioned it.
Lord Peyton of Yeovil: My Lords, it has emerged very quietly and in a very low-profile fashion during the currency of these debates that Professor Littlechild—poor man‡—is to be the individual saddled with the fate of being the Director General of Electricity Supply.
Lord Renton: My Lords, I am grateful to my noble friend because he has mentioned something that has escaped me. I wonder how we can be sure that he has made himself aware of the matters that are contained in the words that my noble friend wishes to have omitted. How can those words possibly be enforced? They are not fit for law-making and, that being so, as he said, they should be taken out.
Lord Peston: My Lords, again I rise with slight trepidation in support of this amendment. If the Government do not accept it I hope that this is an occasion when a little exercise through the Division Lobbies might be appropriate. However, that is a matter for the noble Lord, Lord Peyton. Ending the relevant sentence at the point where the noble Lord, Lord Peyton, wishes it to be ended is to raise the question: for what other reason would the director wish to collect this information? In other words, the noble Lord, Lord Peyton, is entirely right. The sentence can stop exactly where he wants it to, because that is obviously—I underline the word "obviously"—where the sentence should stop. I make that point of agreement with him and hope very much that the Government will see the point of what he has said.
The Earl of Dundee: My Lords, I am grateful to your Lordships and to my noble friend Lord Peyton. I have listened carefully to the arguments. I do not wish to delay the House. I will agree to take this hack without commitment and reconsider the matter.
Lord Peyton of Yeovil: My Lords, this is the second shock. I very much doubt whether I have the constitution required to take these shocks, but I shall do my best and face them with such courage and resources as I can muster.
I am grateful to my noble friend, and I hope that at Third Reading he will come up with a clear determintion to delete this horrible—I will not use the noun that occurred to me. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Hooper Baroness Hooper moved Amendment No. 118:
Page 37, line 11, at end insert ("and this subsection applies to any activities connected with the generation, transmission and supply of electricity, including in particular activities connected with the supply to any premises of heat produced in association with electricity and steam produced from and air and water heated by such heat.").
The noble Baroness said: My Lords, I beg to move.
The Deputy Speaker: My Lords, as an amendment to Amendment No. 118 I now call Amendment No. 119.
Lord Bonham-Carter: My Lords, the amendment is not moved.
[Amendment No. 119 not moved.]
On Question, Amendment No. 118 agreed to.
Clause 51 [Annual and other reports]:
Baroness Oppenheim-Barnes Baroness Oppenheim-Barnes moved Amendment No. 120:
Page 38, line 39, leave out ("and").
The noble Baroness said: My Lords, I beg to move Amendment No. 120 and to speak to Amendments Nos. 121 and 124.
During the Committee stage of the Bill I moved an amendment on behalf of the National Consumer Council urging the Government to accept that consumers of monopoly utilities, especially electricity, need national representation as well as the very welcome local representation which the Bill provides for in the regional consumer committees. That amendment did not entirely find favour with my noble friend the Minister.
These amendments have the same objective but in a somewhat altered form. The effect of the amendments is to create in addition to the regional consumer committees a national consumers consultative committee known as the NCCC, with a remit to keep under review matters affecting the interests of electricity consumers generally, including the important issue of prices. It would also facilitiate the exchange of information relating to such matters between the director and the regional consumer committees. It would be chaired by the director and would consist of the chairmen of each of the RCCs, who would become members of the NCCC by virtue of their appointment as chairmen of the RCCs.
This is a formal structure which would be created for the discussion and exchange of information relating to national policy for electricity consumers. This is crucial to the director's ability to carry out his role successfully. Comparisons could he made between the different performances of the regional committees in relation to consumers and, indeed, between the performances of the regional companies themselves. Some are bound to be more successful than others, just as some of the regional companies are bound to be better than others. I hope that at the regular meetings the chairmen would compete with one another in bringing there stories of their own successes.
We believe that this information, discussed and analysed at national level, will be vital to the director when he sets national policy and when he negotiates with the local companies. It will enable him to discern which is the highest common denominator and not the lowest that is acceptable in terms of national policy. At the same time, he will have collated invaluable information to use when negotiating important issues such as prices and considering incidences of bad practice and poor performance.
As things are, without these amendments the terms of reference for each of the regional committees are drawn up exclusively to deal with the supply of electricity in its own geographical area. There is no provision for them to consider at national level issues which have to be resolved at that level by the director. These amendments remedy that omission.
The consequential amendments, Amendments Nos. 120 and 121 to Clause 51, would ensure that the director had a duty in his annual report to report in the form of a general survey on the activities of the new NCCC, in addition of course to the general survey in which he must already include the activities of the regional committees.
I spoke at length in Committee about the need for such a body, about its role and about how the structure of consumer protection in the gas industry is so admirable. If the Government accept these amendments tonight, then the newly-privatised electricity industry will be off to a flying start with a good structure for consumer protection; indeed, possibly a better structure than in any of the other privatised industries—certainly a far better structure than that which exists at present.
I urge my noble friend the Minister to look kindly upon the comparative modesty of these amendments and to accept their great importance to electricity consumers. I beg to move
Lord Renton: My Lords, I think that my noble friend has raised a most important matter and made a very valuable suggestion. I do not remember there being a statutory central users' consultancy council for electricity, but there was a body which we in the department, when I was there, used to know as "the electric women". They were, I think, called the Women's National Electricity Council. They were really representatives of housewives using electricity.
Of course, what is proposed here is something different. However, it is useful to have a central body in order to compare the performance in each region, and so on. I do not know quite what answer my noble friends on the Front Bench will give, but I think that is is a good suggestion, one which deserves serious consideration.
Lord Peston: My Lords, in rising to speak to this amendment I am of course aware of the position in the consumer world of the noble Baroness, Lady Oppenheim-Barnes. Indeed, she has vast experience in this area, and I think, therefore, that noble Lords would do well to listen carefully to the advice which she is offering.
In a way, the two main amendments are not necessarily interlinked, although they are related to one another. Perhaps I may speak briefly on Amendment No. 121. It seems to me that such a general survey of consumer activities during the year would be intrinsically valuable, whatever else we may say. I strongly support the proposal, in particular because I believe that such surveys attract public attention; they raise the general profile of consumerism; and they are educative so far as concerns the public in such matters.
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As regards the council itself, let me say briefly that I entirely agree with the noble Baroness. I think that this would again raise the standards of consumer representation in the industry. I always make the point, on this and on all other matters, that all industries exist for the consumers; that is why they operate, and that is what they are there for. Therefore, to have direct consumer input is at least one way of seeing that the consumer will get, to some degree, what he or she should have. Therefore I am totally with the noble Baroness on this proposal. She referred to the fact that this would be a kind of highest common factor, and I think that that is very good.
I entirely agree with the noble Baroness—and I do not say this in a mean spirit—about the existing consumer council in the electricity industry; but this would be something of a far higher order of magnitude and is therefore to be welcomed from that point of view. Moreover, I think that the noble Baroness is almost certainly right when she says that if the Government will move in this direction then they will give a stronger consumer voice in this area than has occurred in any of the other privatisation issues. However, I shall certainly not at this time of night start another debate on privatisation. Nonetheless, if we are going down that road, what the noble Baroness offers is a proposal which the Government should take seriously. Either in this form or in a form brought forward by the Government, I assure the Minister that she would receive complete support from this side of your Lordships' House.
9.45 p.m.
Baroness Hooper: My Lords, as my noble friend Lord Glenarthur made clear in Committee, we have given considerable thought to whether a new national body is needed in the privatised industry. As your Lordships will be aware, the Select Committee on Energy of another place recommended to the Government that there was no need for such a body. The Government accepted that view in their formal response to the committee's report. We felt that consumer interests would best be served by local consumer committees serving grass roots needs.
Nonetheless, we have always believed—here we agree with my noble friend Lady OppenheimBarnes—that national co-ordination of the activities of the new consumers' committees would be a vital part of the new arrangement. It is clearly important that the experience of the various committees at local level should be pooled and exchanged so that they can benefit from one another's experience and national lessons drawn where appropriate. To that end the Bill gives the Director General of Electricity Supply, who will have the ultimate statutory duty to protect consumers' interests, a duty under Clause 48 to make arrangements for the provision of information to consumers' committees and the facilitating of the exchange of information among them.
We feel that the amendments will supplement such provision by formalising arrangements for regular meetings at national level in the way described by

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my noble friend. Like noble Lords who support the amendment, we believe that that will be beneficial. I am happy therefore to accept that the amendments will achieve the national co-ordination of consumer representation in the privatised electricity supply industry which my noble friend has advocated. I accept the amendment.
Baroness Oppenheim-Barnes: My Lords, my emotion is not one of shock but of great gratitude to my noble friend the Minister for the generous way in which she has accepted the amendment. She has demonstrated in the best possible way her, and the Government's, commitment to ensuring that consumers are adequately protected after privatisation. I am sure that consumers will benefit and that they share my gratitude. I thank my noble friend.
On Question, amendment agreed to.
Baroness Oppenheim-Barnes Baroness Oppenheim-Barnes moved Amendment No. 121:
Page 38, line 42, at end insert ("; and
("(e) include a general survey of the activities during the year of the National Consumers' Consultative Committee.").
On Question, amendment agreed to.
Clause 53 [Periodical and other reports]:
Lord Peston Lord Peston moved Amendment No. 122:
Page 39, line 33, after second ("time") insert ("but not less than once a year").
The noble Lord said: My Lords, I speak with a growing sense of grievance. As we have been going through the Bill, noble Lords have occasionally found their amendments accepted by the Government. I am the only person left who has not had an amendment accepted. I find that most unacceptable, especially as I feel that I am doing as much work on the Bill as any other noble Lord.
This is a good, simple amendment: the Government might decide to humour me by accepting it. With regard to the mini-consumer committees, as opposed to what will now be the Oppenheim-Barnes grand committee, the amendment merely says that "from time to time" is somewhat weak and that they should meet not less than once a year. I cannot imagine that anyone would think that they should meet less than once a year. If the Government are inclined to put me into a better mood, this is an amendment they should accept. I beg to move.
Baroness Hooper: My Lords, it would indeed be shocking if we did not try to humour the noble Lord, Lord Peston, after his appeal. The present wording of the Bill requires the consumers' committees to report to the director from time to time. We believe that it is important that the committees should be able to report to the director freely at any time, as it is likely that they will make several reports in every year, either on their activities or at the request of the director, or on a matter which they may wish to draw to the director's attention.
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I therefore have some sympathy with the concern expressed by the noble Lord, Lord Peston, to ensure that the director receives a report from each committee on its activities at least once a year. I am therefore very happy to say that the Government will accept the spirit of the amendment. But perhaps we may consider the precise wording and drafting so as to retain consistency with similar provisions elsewhere in the Bill, in particular Clause 43(4).
If it is agreeable to the noble Lord, in terms of a pleasant surprise or shock which this may bring him, the Government will be willing to bring forward an amendment at Third Reading in order to achieve the noble Lord's aim.
Lord Peston: My Lords, I thank the noble Baroness. The fact that the Government will improve on the wording is even more pleasant for me to hear. Therefore, for the moment I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 123 not moved.]
Baroness Oppenheim-Barnes Baroness Oppenheim-Barnes moved Amendment No. 124:
After Clause 53, insert the following new clause—
("National Consumers' Consultative Committee
.—(1) There shall be a committee, to be known as the National Consumers' Consultative Committee, of which the Director shall be chairman and the ordinary members shall be the persons who for the time being hold office as chairmen of consumers' committees.
(2) the committee shall meet at least four times a year and shall be under a duty—

(a) to keep under review matters affecting the interests of consumers of electricity generally; and

(b) to facilitate the exchange of information relating to such matters between the Director, the ordinary members and their respective consumers' committees.").

On Question, amendment agreed to.
Clause 57 [General restrictions on disclosure of information]:
Lord Peston Lord Peston moved Amendment No. 125:
Page 41, line 47, leave out ("or") and insert—
("(gg) For the purpose of facilitating the conduct of collective bargaining between appropriate representatives of employees and any particular business;").
The noble Lord said: My Lords, perhaps with this amendment I may also speak to Amendment No. 126. This section of the Bill is headed "Miscellaneous", and Clause 57 is an interesting clause to do with the disclosure of information. I agree that it is a matter of some delicacy because, after all, we are discussing the plcs as they will be. There are always problems as to what information ought to be in the public domain and what ought not. Essentially the clause starts with the negative part of no information etc. Then it says that it does not apply to a variety of matters.
I, with my noble friends and the noble Viscount, Lord Hanworth, and the noble Lord, Lord Ezra, have no disagreement with that. It is a question of whether or not there ought to be two further exemptions. Perhaps noble Lords will permit me to take them in reverse order.
The second one is important in the sense that this industry, in terms of its operations and all the levels of generation, transmission and supply, will and ought to be subject to public scrutiny. It would be a most unsatisfactory state of affairs if, in connection with the operations of the industry and the awarding of licences, relevant information were limited. In other words, there are those who have every reason to possess information in order to scrutinise the industry and, for all the arguments we have heard about competition and the role of the director, general public scrutiny remains of importance. It seems to me, to say the least, that it would be a pity if there were any encouragement to limit the availability of information.
Looking at the clause, I myself am not at all clear that it is drafted as well as it might be to cover the meaning that I have in mind. I believe that I have explained what I have in mind here. I am not of the extremist school of thought which says that all information ought to be in the public domain, but I am of the school of thought that believes that information is one of the great protectors, not only of the national interest but of the private interests of consumers.
The other point I wish to raise is an important matter. It is curious that in discussing this Bill—we are now coming to the end of it—we have had very little debate on the employees of this industry. The Bill will affect them to a very large degree, but I accept that in another way the Bill is not about them. I suppose that is one of the reasons why we have said very little about them. Nevertheless, the employees are part of the industry and the industry will not operate without them. Despite certain comments I hear as I sit in your Lordships' House about the current state of collective bargaining in this country, I assume we shall still have an economy where collective bargaining is the characteristic method of determining wages and conditions in industry. We are obliged to do that by our commitments to the ILO, and we shall be further obliged to do that by all kinds of developments in the EC.
It would be a pity if information that would facilitate the conduct of collective bargaining were not available. By "facilitate", I do not mean producing strikes and bad industrial relations, but rather producing agreements and good industrial relations. It would be a pity if there were not a general propensity, obligation—perhaps "obligation" is going too far—or tendency to disclose information that would be conducive to collective bargaining. I commend both amendments to your Lordships and, perhaps more to the point, I commend to your Lordships the kind of thinking which lies behind the amendments. I appreciate it is a little late to say to the Government that we should have thought about some of these matters a little earlier, but I shall be interested to hear the Government's response on these two amendments. I beg to move.
Lord Sanderson of Bowden: My Lords, I believe the noble Lord, Lord Peston, wishes to ensure that
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associated with industrial relations or health and safety matters. In Committee the noble Viscount, Lord Hanworth, sought assurances that Clause 57, as presently drafted, did not prevent the normal flows of information associated with industrial relations or health and safety matters. He received an assurance from my noble friend Lady Hooper that it did not.
The provisions in Clause 57 will ensure that commercially sensitive information which has to be given to the Secretary of State or the director by licensees or others under any provision in Part I of the Bill will not fall into the hands of a competitor, or otherwise be disclosed. This clause does not in any way restrict the normal flows of information connected with health and safety at work matters between employer and employee. I hope that the noble Lord will see that point.
The Secretary of State and the director both have a duty, under Clause 4(3)(d), to secure the establishment of health and safety machinery for employees in the industry. This duty has been translated into conditions contained in all the licences which place a duty on the licensee to act together with other licensees to consult with representatives of their employees for the purpose of establishing an appropriate machinery.
Here I come to the important point in answer to the noble Lord, Lord Peston. We have always made it clear that the existing national machinery for negotiations between the unions and management would be carried over into the privatised industry. The Bill therefore provides that each of the new companies will become an individual party to any national negotiating machinery, and that each of the parties must give 12 months' notice of withdrawal to the other parties.
Aside from their duties to secure the establishment of health and safety machinery for employees in the industry which I have mentioned, neither the Secretary of State nor the director will play any part in the conduct of industrial relations in the privatised industry, whether it be collective bargaining or any other form of negotiating machinery. There are no provisions in the Bill for either the Secretary of State or the director to obtain such information. It would be entirely wrong for them to do so. These are matters which are purely for the successor companies and their workforces to arrange themselves.
I hope that with that explanation of what the Government have in mind the fears of the noble Lord, Lord Peston, are put at rest.
10 p.m.
Lord Peston: My Lords, I thank the noble Lord. I am most encouraged by his remarks in relation to health and safety. I am pleased to hear what he had to say.
I am slightly more fearful than he is about the general climate of industrial relations. On the whole, I have always been one of those who would prefer collective bargaining to go ahead and to persuade both sides of industry to sort matters out themselves. I am afraid that in our society, as we have learnt recently to our cost, that does not always work as

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well as we should like. That is why we have fall-back powers, either for Secretaries of State or other bodies.
I take what the noble Lord said. It seems to be a valid point of view even if it is one with which I disagree. I thank him for what he has said. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 126 not moved.]
Clause 58 [Directions restricting the use of certain information.]:
[Amendment No. 127 not moved.]
Clause 60 [Powers to make regulations.]
Lord Peyton of Yeovil Lord Peyton of Yeovil moved Amendment No. 128:
Page 44, line 24, leave out subsection (3).
The noble Lord said: My Lords, I make no apology to your Lordships for reminding the House, even at this late hour of the night, of the wording which it is on the brink of inserting on to the statute book. It would be a pity too if those ardent readers of the Official Report did not also have a chance of studying them. Clause 60(3) states:
"Regulations made under any provision of this Part may—

" (a) provide for anything falling to be determined under the regulations to be determined by such persons, in accordance with such procedure and by reference to such matters and to the opinion of such persons as may be prescribed by the regulations;

"(b) make different provision for different cases, including different provision in relation to different persons, circumstances or localities".

I have three solemn and serious questions to ask whichever of my noble friends is going to reply. First, what does he want those words to mean? Secondly, what does he think they mean? Thirdly, what do they mean?
I venture this observation in conclusion. The answer to the third question will be very difficult for him but very easy for me, and indeed for the rest of your Lordships. We shall, all of us, I am sure have no difficulty in concluding that those words mean nothing. Gobbledygook is quite a polite and civil description of this kind of garbage. I hope very much that the Government will have second thoughts and not allow it to soil the pages of the statute book.
Lord Peston: My Lords, I should normally wish to support the noble Lord, Lord Peyton, on an amendment of this kind. However, I must follow the noble Lord, Lord Bonham-Carter. I have always assumed that paragraphs of this kind were written into the Bill as a kind of outdoor relief for the legal profession. Although to the rest of us this does not seem to mean anything and seems to be gobbledygook, I thought that that was how the legal profession earned its living. Given the pressures the profession is under from other quarters, one is loath to suggest anything that might lower their standard of living at this time. Therefore, although my natural inclination is to support the noble Lord, Lord Peyton, I believe that these clauses are included
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for a very definite, productive, almost Keynesian, purpose.
Lord Bonham-Carter: My Lords, the House owes a great debt of gratitude to the noble Lord, Lord Peyton of Yeovil, both for the amendment that he moved and for the manner in which he moved it. Unlike the noble Lord, Lord Peston, I have no inhibition in supporting him.
Lord Sanderson of Bowden: My Lords, we have come a long way since the last stage of the Bill because I seem to have obtained recognition from the noble Lord, Lord Peston, that there is some purpose in this subsection. I notice that his view differs from that of his noble friend Lord Williams of Elvel who at that time called the subsection "unconstitutional". I suppose that it could be said that consistency exists in that the noble Lord, Lord Bonham-Carter, called the whole thing "monstrous" at the last stage while my noble friend Lord Peyton described the subsection as "just horrid".
The noble Lord has suggested that Clause 60(3) would not easily be understood. Clause 60 as a whole is there to support the other regulation-making powers in Part I of the Bill. It will be of great importance to those who draft the regulations in defining the limits of the powers and to those who wish to scrutinise the regulations who will know that they have been drafted within the powers. The clause may also be important to the courts should they ever be called upon to adjudicate on the lawfulness of any regulations made under Part I. The clause is a highly technical provision which will be of interest to lawyers and others concerned with the drafting and lawfulness of subordinate legislation. Whether or not it will be of direct interest to consumers is arguable. They will of course be interested in many of the regulations to be made under Part I; for example, those establishing the guaranteed standards scheme. We shall do our best to ensure that the regulations are clearly drafted in the awareness that those who scrutinise subordinate legislation will want before them provisions which are not obscure.
Like the noble Lord, Lord Peston, am aware of the professional background of my noble friend and I have no doubt that legislation loomed large in his mind when he was at the Inner Temple. I have taken seriously his concerns about the drafting of Clause 60. I must therefore say to him that, if he will agree to withdraw the amendment, I shall undertake, without any commitment, to ask that the draftsman looks closely at the terms of the clause with a view to establishing whether any improvement can be effected. However, I must say to my noble friend that that improvement will not be in the substance of what we are trying to achieve; it will be purely in the drafting.
To pick up what my noble friend said, he appears to be getting at the fact that the word "different" is mentioned four times in one subsection and the words "determined" or "determination" in another subsection. I undertake that the draftsman may have to burn the midnight oil but I am sure that, if my noble friend's strong feelings are to be judged correctly, that might not be wasted.
Lord Peyton of Yeovil: My Lords, I am almost drowning in gratification. But one good turn deserves another. Since my noble friend has taken such a gracious and generous view of this modest amendment, I shall not press him to answer the three questions that I asked; namely, what does he want those words to mean, what does he think they mean, and what do they mean? I must tell him that I shall enjoy asking those questions should that unfortunately be necessary at a later stage of the Bill when he tells us of the conclusions that he has reached. I hope very much that the outcome will be profitable and positive. On that basis I have great pleasure in asking permission to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 64 [Interpretation etc. of Part I]:
[Amendment No. 129 not moved.]
The Earl of Dundee: My Lords, I beg to move that further consideration on Report be now adjourned.
Moved accordingly, and, on Question, Motion agreed to.
House adjourned at ten minutes past ten o'clock.