Local Government and Housing Bill

HL Deb 24 July 1989 vol 510 cc1157-208

5 p.m.

House again in Committee.

Clause 19 [Duty to adopt certain procedural standing orders]:

[Amendments Nos. 105 to 109 not moved.]

Clause 19 agreed to.

Clause 20 [Interpretation of Part I]:

Lord Ross of Newport moved Amendment No. 110:

Page 27, line 32, at end insert— (" "local authority" does not include parish councils;").

The noble Lord said: This is a probing amendment. At the end of Part I we are dealing with interpretation. While I assume it is the case that parish councillors are excluded from Part I, there is an anomaly on which I should like some guidance from the Government. My attention has been drawn to this by a county council officer who is a parish councillor. He also happens to sit on a district council and earns more than £13,500 a year. He recognises that in the future he will be barred from sitting on the district council but he will wish to continue his work as a parish councillor.

We know that when the Bill become law the Government intend to introduce regulations which will restrict certain political activities. Those are likely to include writing or speaking publicly on controversial issues, canvassing at elections, holding office in a political party or even having in one's home or one's car a poster supporting a political candidate. Whether we like it or not, the fact is that many parish councillors and town councillors are members of political parties and canvass as such. What restriction will there be on such local government officers who are parish councillors? Will they be able to speak publicly or canvass on controversial issues when they are standing for election to town or parish councils?

Will the effect of the legislation be that local government officers in politically restricted posts will be able to stand for parish councils only as independents and will not be able to have posters or stickers in their cars which might have political connotations? Will these officers be able to sign petitions on controversial issues or write letters to the press, and so on?

The amendment may not be in order but it gives me a chance to raise these points about parish councillors. What is their position to be? Will they be included in these regulations? If so, will that not destroy the ability of those people to serve on parish councils? Many of them serve with great distinction. As a county councillor I sat for hours at local parish meetings which went on interminably. Those meetings were chaired by officers. What is their future to be? Are they to be barred? I beg to move.

The Earl of Arran

I appreciate that the amendment is a probing amendment but it may be helpful to the Committee if I briefly set out the reasons why we consider that parish councils should be excluded from Part I of the Bill. The clauses in Part I which apply to parish councillors are Clause 7—all staff to be appointed on merit; Clause 10—limit on paid leave for local authority duties; Clause 13—voting rights of members of certain committees; and Clause 19—duty to adopt certain procedural standing orders.

Clause 7 is a statutory declaration of the long-standing tradition in the public service in this country that public appointments should be made on merit. We cannot see that the case for an exception for parish councils has been made. Is it realistic to say that parish councils are to be allowed to make appointments of paid staff on grounds other than merit? We consider not.

Clause 10 provides a statutory upper limit on the paid leave which a local authority may grant to its staff to carry out their duties as councillors on another authority. Some large parish councils employ full-time staff. We believe that the principle of the limit should hold good for parish councils in the same way as for other councils.

Clause 13 confines voting rights on local authority committees and sub-committees to elected members, except in the cases where a special exemption is made. This effectively places responsibility for executive decisions and actions with the democratically elected members. It does not stop other members being appointed in a consultative role. Some parish councils use committees, and we see no reason to make an exception for parish councils in this matter.

In the case of Clause 19—the provision for requiring a compulsory core of standing orders—we have no plans at present for using it in relation to parish councils. From time to time, however, there are complaints about abuses of procedure in relation to parish councils. This power would be an appropriate means to take preventive action if it was ever needed. We therefore think that there is good justification for the application of these four provisions to parish councils. The other clauses do not apply, since they apply only to the relevant authorities listed in Clause 20, which are defined for each group of provisions.

Finally, I should mention that the amendment is defective in that it exempts parish councils, which are found only in England, and does not exempt community councils, which are the equivalent in Wales. We would not regard it as satisfactory to treat these differently. We have had no representations from the National Association of Local Councils, which represents parish councils, about the provisions of the Bill.

The noble Lord asked whether parish council membership would be restrained. There will be no restriction on parish council membership. Parish councillors will be able to canvass for themselves but will not be able to canvass for a political party. We shall be consulting on this proposal. In the light of what I have said, I hope that the noble Lord will feel able to withdraw his amendment.

Lord Ross of Newport

I am grateful to the Minister. He went at a fair pace to start with, so I shall need to read his words rather carefully. He came to the point which I raised. I welcome that. It clarifies the position to some extent. As I said earlier, it was a probing amendment. I felt that it was probably wrongly drafted, and he has confirmed that it should have included community councils. I shall study with interest what he has said. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 20 agreed to.

Clause 21 [Advisory commissioners]:

On Question, Whether Clause 21 shall stand part of the Bill?

The Principal Deputy Chairman of Committees (Baroness Serota)

Clause 21 is the first clause in Part II of the Bill, which deals with local government administration. I should like the Minister to explain to the Committee the role and function the Government see for these new advisory members of the Commissions for Local Administration in England and Wales.

As he will know, the present commissions consist of the local commissioners together with the parliamentary commissioner ex officio. That provision was made in Part II of the Local Government Act 1974 and has proved extremely valuable, particularly as the same Act also made provision for composite investigations to be undertaken by the local commissioners together with the parliamentary commissioner, or in his role as health service commissioner when complaints were received which affected both local government services and central government and/or health services.

I should be most interested to know what kind of people these new advisory members will be, who will appoint them and for how long. Of course, the present commissioners hold office during pleasure until they reach the age of 65 and are bound by certain conditions of confidentiality in the legislation.

I presume that they are the external members who first emerged as a proposal when the Government responded to the Widdicombe Report. It would be extremely helpful if the Minister could enlighten us as regards the new membership of both commissions and if he could also give the Committee some idea of what they will do and for how long they will be doing so.

Lord Hesketh

It is always a great pleasure to have the company of the noble Baroness, Lady Serota, in Committee. I stand here feeling a certain amount of awe and trepidation because, as Members of the Committee will be aware, the noble Baroness was the chairman of the Commission for Local Administration in England. As a result, I should have thought that there were 'few people in this country better versed as regards the matters contained in this part of the Bill.

Clause 21 amends the Local Government Act 1974 to allow the appointment of advisory members to the Commissions for Local Administration in England and Wales. The number of such members appointed to each commission may not exceed the number of local commissioners, who continue to retain sole responsibility for carrying out investigations.

The purpose of this provision is to bring a wider range of interest and experience to the commissions. The advisory commissioners will be particularly concerned with the running of the commissions —their general finance and administration—and should be able to advise on wider issues affecting the ombudsman. This should lighten the load on the investigative commissioners which has increased significantly over the last year.

Although the clause would enable the appointment of a maximum of three advisory commissioners in England, we are at the present time only proposing to appoint two. My right honourable friend is considering whether there is a need for such an appointment in Wales, given the small size of the commission.

I trust that Members of the Committee will recognise the value of bringing additional experience to the commissions, and that the advisory commissioners will usefully complement the existing membership, and serve to strengthen the efficiency of those bodies.

As regards the question as to who the advisory members will be, we expect them to be drawn from business and from the academic world and appointed for a fixed term by the Monarch, on the advice of the Secretary of State. It is to help the investigative members of the commissison to achieve better performance that the advisory members have been added to the Civil Service Commission.

Baroness Serota

I am extremely grateful to the Minister for his explanation. The present commissions are under pressure, especially the English commission, because of the great increase in the number of complaints in recent years. I must, however, confess that I am still a little puzzled as to what these advisers will do if they are not going to investigate complaints. I say that because the commissions are relatively small organisations and, in my experience, are already extremely efficiently run. Nevertheless, it is helpful to have on the record just what the Government have in mind for these particular appointments. I shall watch with interest to see how the proposal works out when these people are actually appointed.

Clause 21 agreed to.

5.15 p.m.

Clause 22 [Advice and guidance by Commissions for Local Administration and Scottish Commissioner]:

Lord McIntosh of Haringey moved Amendment No. 111: Page 28, line 24, after ("appropriate") insert ("in relation to its other functions").

The noble Lord said: I, too, rise with trepidation to speak on Part II of the Bill, conscious of the experience and wisdom of my noble friend Lady Serota. I can only say that as the son-in-law of the late Tom Sargant who was the founding secretary of Justice, and as one who took a leading part in the movement to establish the post of ombudsman, I have a longstanding interest—if, perhaps, no qualifications—enabling me to speak on the matter.

The object of Amendment No. 111 is again to question the Government about the intention of the wider powers which are given to the commissions for local administration under Clause 22. The commissions will now be able to give advice to local authorities about good administrative practice, or such advice and guidance about good administrative practice as appears to the commission to be appropriate.

Our amendment would insert the words, in relation to its other functions", so that the advice and guidance is not simply an open-ended opportunity for the commissions to become involved in all aspects of the administration of local government. This not in any way intended as a criticism of the work of the commissions; but it is intended to find a mechanism—although we may not yet have the wording right—whereby the investigation of complaints of maladministration shall remain at the centre of the commissions' activities.

We already have an Audit Commission which looks into the administration of local authorities. However much the commissions for local administration may be able to contribute to that work, it seems to us that the Audit Commission should stick to its own job and that the commissions should stick to their job which is to protect the ordinary members of the public from maladministration by local authorities.

We hope that it is not the Government's intention to lose sight of the primary reason for the establishment of the commissioners for local administration and the Scottish commissioner and that we shall receive satisfactory assurances on that point from the Minister in his reply.

The Earl of Arran

I must assure Members of the Committee that, whatever the circumstances, I always rise to speak with trepidation. However, surprisingly, this amendment does not seek to confine the advice which may be issued by the Scottish commissioner.

We welcome the opportunity which this amendment provides to clarify the role which the commissions in England and Wales and the Scottish commissioner will play in issuing advice and guidance. We do not see this as a major extension of the commissions' role. The local ombudsman's prime function will continue to be the investigation of complaints by individuals. The provisions are more by way of enabling powers to allow local government to benefit from the wealth of experience that the commissioners gain in carrying out those investigations, which it would be foolish to continue to allow to go to waste.

The advice and guidance which the commissions will issue will tend to be in the area of administrative practices and procedures with the aim of pointing to common faults and highlighting examples of good practice where they occur.

The advice will be what it says—purely advisory—and there will be no obligation on local authorities to follow it. Clause 22 also requires the commission to consult representatives of those concerned before issuing advice, so the local authority associations will have ample opportunity to comment.

The advice and guidance will thus be related in general to the investigative functions of the commissioners. However, we think that it would not be desirable to impose an absolute restriction on the matters which the advice can cover, as the amendment proposes. That might prevent the commission from drawing wider conclusions from the knowledge and experience it has gained through investigations. In view of those comments, I hope that the noble Lord, Lord McIntosh of Haringey, will feel able to withdraw the amendment.

Lord McIntosh of Haringey

What the noble Earl has said sounds reassuring. If the commissions are to confine their advice and guidance primarily to good administrative practice in relation to the pattern of complaints of maladministration that they have received, the Government's intention is close to that which we intended in moving the amendment.

The amendment is in any case as the noble Earl has indicated, defective in that it does not include an amendment under Clause 22(2) in relation to Scotland. However, that is a problem which could easily be remedied at a later stage or even by a manuscript amendment now. However, I am, as I say, relatively reassured by what the noble Earl has said, which I shall read carefully before deciding whether I need to refer to the matter at a later stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 22 agreed to.

Lord McIntosh of Haringey moved Amendment No. 112: After Clause 22, insert the following new clause—

("Investigation by Commissioner.

.—(1) In section 23 of the local Government Act 1974 (appointment and functions of Commissions for Local Administration) there shall be inserted after subsection (12) the following subsection—

"( ) Each of the Commissions may investigate a matter in relation to which no person has made a complaint in circumstances where it considers that an injustice may have occurred, or is likely to occur, or where it considers that a complaint is unlikely to be made, and where in the opinion of the Commission an investigation would be appropriate for the purpose of preventing or remedying maladministration.".

The noble Lord said: Although the new clause is not in the same form, it is related to the matters which we have just been discussing. Widdicombe, at paragraph 9.75, referred to the present restrictions on ombudsmen to pursue an investigation where a complaint from the individual concerned is not referred to them in writing. That has been a matter of debate by the commission and Justice for a number of years. Justice carried out research as long ago as 1976 and 1977 which showed that there was a strong middle class bias among complainants. Over 70 per cent. of complaints were made by non-manual households. Those findings were published in 1980 in Justice's review of the first five years of the institution of the local ombudsman.

There is a risk that those who are less well educated and less sure of their rights may find it more difficult to make complaints in writing, even with the help of their local councillors. We propose in the new clause that under certain circumstances—clearly the commissioners will wish to use the circumstances carefully—where no person has made a complaint, but where the commissioners consider: that an injustice may have occurred, or is likely to occur, or where it considers that a complaint is unlikely to be made, and where in the opinion of the Commission an investigation would be appropriate for the purpose of preventing or remedying maladministration". they may be able to make an investigation. As I have said, that is a power which would have to be used cautiously or the commissioners' work would become intolerable. It is a power which is strictly complementary to the commission's work. It follows research which has been well established over a period of years. It coincides with Widdicombe's recommendation. I beg to move.

Baroness Serota

I support the amendment moved by my noble friend Lord McIntosh of Haringey, which would enable the commissioners to investigate on their own initiative. As he has said, it is a well-founded proposal. It was recommended in the earlier and later Justice reports. It is a power that exists in other jurisdictions in other parts of the world: in common law countries, Commonwealth countries and countries on the Continent of Europe.

I entirely agree with my noble friend that it is a power that should be used cautiously and sparingly. It is fair to say that the record of the local commissioners is such that there is every reason to believe that that would be so. Of their 7,000 complaints, I see from last year's annual report, which was published only last week, that they took only 5 per cent. to full investigation and public report. That is hardly an indication of fools rushing in where angels fear to tread.

There is a need in matters of public importance —that has been evidenced in recent years, especially in relation to the deaths of children and the care of vulnerable elderly people in residential institutions—for complaints to be investigated where the individuals concerned cannot themselves bring a complaint. Such cases are currently the subject of ad hoc inquiries, conducted under commissions of inquiry set up by Ministers under other statutory powers; but there are still other cases which, in my experience, would have been the subject of complaint if the individuals had been able to make such complaints.

Without appearing to be biased, I believe that I stand sufficiently distanced from the commission now to take an impartial view of its operations. It is fair to say that the commissioners are singularly well-placed to undertake such investigations. They are extremely familiar with the working of the local authorities through their day-to-day work. They have an able and experienced staff, well used to conducting investigations, some of which require a considerable degree of confidentiality as they deal with many personal matters.

Clearly the commissioners would not wish to pursue such an investigation except when there was good ground for concern and prima facie evidence to suggest that injustice had occurred.

The amendment may commend itself to the Government because the ombudsman's investigations are far less costly than those undertaken by high-powered and legally chaired independent inquiries set up under statutory powers. Indeed, their costs are modest. The commissioners' continuous investigative experience would be of great value in those few, but nevertheless important, cases where individuals are unlikely to be able to bring a complaint themselves.

Lord Hesketh

The amendment would enable the local commissioners in England and Wales to carry out investigations on their own initiative where they had reason to believe that a member of the public may have suffered injustice as a result of maladministration by an authority.

The amendment would constitute a radical change to the local ombudsman's role. Instead of carrying out investigations into individual complaints of injustice, he would become a general purpose watchdog over local government. We do not consider that those two roles are compatible or that such a watchdog is necessary at present. The Widdicombe Committee made a recommendation along the lines of the proposed amendment. It suggested that it would shine the local ombudsman's torch into dark corners and would offset the inclination of certain groups not to complain.

There are such dark corners in local government and they need illuminating; but we have set up other search lights to seek them out. The new range of measures in Part I will get rid of many of the abuses and ensure that councils operate fairly and democratically. The Bill, together with last year's Local Government Finance Act, also provides for councils to appoint separate finance and monitoring officers who will be under a duty to blow the whistle if they consider that the council is about to act illegally or improperly, including taking action likely to result in injustice due to maladministration.

It is also clear that the local ombudsman is becoming more widely known and accepted as a way of seeking redress from local authorities. That is evidenced by the substantial increase in the number of cases that the local ombudsman is now receiving. Much of that is attributable to the introduction of direct access in last year's local government legislation which made it possible for complaints to be made directly to the local ombudsman instead of through a councillor. The commissioners themselves have also taken steps to publicise their activities, and information about the service and how to complain is available through the citizens advice bureaux and other consumer groups.

Those measures have made the local ombudsman much more accessible to the general public so that maladministration is more likely to be brought to the attention of the local ombudsman by those who have suffered injustice. He will need to go out and look for it.

Clause 22 also supplements the local ombudsman's powers by enabling him to issue advice and guidance based on the wealth of experience which he gains through the investigation of individual cases of maladministration. This will enable him to focus on common problems and mistakes that occur within local government and indicate ways in which they can be remedied.

Finally, the ombudsman already has the power to investigate a complaint brought by a person who represents someone who he feels has suffered an injustice. So already there is a source of restoration available through a third party. I hope that in these circumstances the noble Lord, Lord McIntosh, will see fit to withdraw his amendment.

5.30 p.m.

Lord McIntosh of Haringey

That was very much the reply that I feared. It shows that the Government's thinking has not only not advanced since we last talked about these matters last year, but in some ways has actually retreated. The whole point of the local ombudsman system, as my noble friend Lady Serota has made clear, is that it is a system which is applied selectively when it is really necessary. It is an economical and efficient system for remedying maladministration.

What the Government are doing all the way through the Bill is imposing more obligations on local authorities, providing more administrative remedies rather than quasi-judicial remedies and giving the Secretary of State more and more power to control local authorities in every detail. That is exactly what we wish to avoid and why we think that the analogy of the local ombudsman is a much better approach to maladministration than the heavy-handed attitude of the Government which is expressed in over 200 pages of the Bill.

I have not in any way been convinced that the very modest extension of the powers of the local ombudsman which was supported by Justice as long ago as 1980 and by Widdicombe in 1986, is not a valuable addition to the work of the ombudsman. It could replace page upon page, tens of pages upon tens of pages of regulations. I am deeply sorry that the Government should take this attitude to the work of the ombudsman and that their alternative should be so heavy-handed, overpowering, untrusting and so lacking in understanding in its approach to local government. I do not think that this is a matter on which I wish to divide the Committee now, but it is something to which we shall have to return at a later stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 23 [Expenses of Commissions for Local Administration]:

Lord McIntosh of Haringey moved Amendment No. 113: Clause 23, leave out clause 23 and insert the following new clause:

("Funding of the Local Commissioners.

.—(1) In Schedule 4 to the Local Government Act 1974, the following paragraphs shall be substituted for paragraphs 6 to 11—

"(6) Expenditure incurred in any year by each of the Commissions shall be defrayed from the Consolidated Fund, subject to the consent of the Secretary of State.

(7) Before granting consent under paragraph 6 above, the Secretary of State shall consult such associations of local authorities as appear to him to be concerned."

(2) Each of the commissions shall prepare a general report on the discharge of their functions in each financial year and shall arrange for its publication.

(3) Before arranging for the publication of a report under subsection (2) above, each of the commissions shall give a reasonable opportunity for such local authority associations to comment on it, and if any comments are made, shall (when arranging for the report to be published) arrange for it to be published with an annex containing such of the comments as the local authority associations concerned consider appropriate.").

The noble Lord said: Once more this is an amendment which has a respectable lineage. Again, in 1980 Justice recommended that the representative bodies should be wound up. This was confirmed by Widdicombe in 1986. The representative bodies, consisting of representatives from the local authority associations, were undoubtedly the right way to start off the local ombudsman system. They were able to take an active part in helping the local ombudsmen to set up their procedures, in helping them to develop methods of investigation which were effective and they provided a valuable contribution to the budget-making and the annual reporting of the local ombudsmen.

However, within a very short time, certainly within five years of the establishment of the local ombudsmen, the representative bodies no longer fulfilled the original role. The basic anomaly of the representative bodies that the local authorities themselves should be paying for the policing of their activities, so to speak, came to the fore.

The Government have taken account of that and now propose in Clause 23 that the funding of the commissions should be an expense of central government and be part of the revenue support grant under the Local Government Finance Act. However, although this moves away from a solution to the funding of the local commissioners which is no longer relevant, it moves away in the wrong direction. It is now putting the funding of the local ombudsmen under the control of the Secretary of State. As we have seen throughout this Bill and throughout nearly all the 50 Bills which have been before Parliament since 1979 on the subject of local government, to use the Secretary of State is a very heavy-handed and overpowering approach. In our view the Secretary of State ought not to have the responsibility for the expenses of the commissions.

So in effect we propose an analogy with the quasi-judicial functions of other similar organisations. We suggest that the funding of the local commissioners should come under the Consolidated Fund, subject to the consent of the Secretary of State who after all is the nearest Government Minister. He should have the duty to propose the amount of expenditure which is considered necessary in respect of the Consolidated Fund.

We agree that the commissions should prepare annual reports and that is provided for in subsection (2) of the new clause. We also take the view in subsection (3) that the commission should give the local authority associations a reasonable opportunity to comment on their annual report and that these comments should, if necessary, be published in an annex. In effect, this replaces the vestigial role of the representative bodies which is now no longer appropriate in its original form.

In the amendment we agree with the Government that the funding of the local commissions should be taken away from the local authorities who are being investigated. However, we think that the role of the Secretary of State should be limited to making a proposal for the Consolidated Fund and that this would maintain and enhance the independence of the local commissions and help them to make their work truly independent both of central government (the Secretary of State) and of the local authorities themselves. I beg to move.

Baroness Serota

In moving the amendment, the noble Lord, Lord McIntosh of Haringey, mentioned the role of the representative bodies, particularly in the early days of the establishment of the commissions in the local ombudsman system in 1974. It would be a pity, when these representative bodies are being abolished not to take the opportunity to pay tribute to their work. I do so with all my heart.

I must confess at the same time that there were occasions when I found the representative bodies extremely negative, if not infuriating, when they met as a group, together with the local commissioners, at a time when we were trying to develop the work of the local ombudsman system. Of course they were trying to keep the costs down. Nevertheless, that was part of their role and in saying farewell to them I think that the Committee would want to thank the individual members of the local authority associations who played a key part in that early work.

With regard to the amendment itself, I am inclined to agree with the noble Lord, Lord McIntosh of Haringey, that if local government or its representatives—through the three local authority associations in their membership of the representative bodies—are no longer to have a working interface with the commissions for funding purposes, it would be right and proper for the commissions to be funded in the ways suggested in the amendment rather than in the way that is suggested in the Bill.

It follows the procedures which were adopted in the late 1960s for the funding of the parliamentary commissioner for administration. In my view the commission must be seen by the public, particularly by complainants, as standing independent both of local government and of central government. The proposal that it should be funded through the Consolidated Fund rather than by the department through the rate support financing arrangements suggested in the Bill, seems to me to be an admirable suggestion. I support it fully.

Lord Hesketh

This amendment deals with two separate issues. With the leave of the Committee, I propose to deal with them separately. Subsection (1) would provide for the commissions for local administration in England and Wales to be funded directly by central government, subject to consultation with the local authority associations. This would replace the provisions in Clause 23 for funding the commissions by top-slicing from revenue support grant under Section 78 of the Local Government Finance Act 1988.

We considered very carefully the whole question of how the local ombudsman should be funded, in the light of the Widdicombe Committee's recommendations. We were concerned that the existing system was excessively bureaucratic, requiring the commissions to levy individual authorities. We also considered the view expressed by the Widdicombe Committee that it was anomalous in principle for the representatives of those subject to investigation to play a major part in dictating the budget of the investigators. Above all, we were conscious of the need to preserve the independence of the local ombudsman in carrying out investigations.

One solution to these problems—perhaps the simplest—would have been for the Government to fund the local ombudsman directly. However, this was an option which was rejected in 1974 when the local ombudsman was first set up, because it would have made it appear that the local ombudsman was a central government service investigating local government. It is important that the local ombudsman is seen as an independent service for local government. These arguments still apply today, and we have concluded that the cost of the local ombudsman should continue to be met by local government. Likewise, we think that local government should continue to have some say over those costs, although not the final say.

The provisions we have included in Clause 23 do, we believe, meet these objectives. They eliminate the bureaucratic collection arrangements by enabling the funds to be paid centrally, whilst at the same time ensuring that the cost is met by local government by way of a reduction in revenue support grant. The clause will require the commissions to consult local government representatives before submitting their estimates. The Secretary of State will have the final say in determining the amount of RSG to be paid to the commissions, and will have a role in scrutinising the commissions' proposals, and ensuring the regularity and propriety of expenditure. I hope the Committee will agree that these are satisfactory arrangements for funding the local commissions, and that central funding would be undesirable.

The second feature of the noble Lord's amendment is to change the arrangements for consulting representatives of authorities within the local ombudsman's jurisdiction, which are provided in Clause 24. I have to say that there is a technical flaw in the amendment as drafted as it does not replace the provisions already provided in Clause 24, so that we would have two alternative arrangements on the statute book. However, I shall address the substance of the amendment of the noble Lord, Lord McIntosh.

The current arrangements provide for the commissions to consult the representative body on its annual report. This is a statutory body set up by order under the Local Government Act 1974 to represent authorities within the local ombudsman's jurisdiction. We have concluded—and the local authority associations and the representative body itself have agreed—that it is no longer appropriate or necessary for the commissions to consult a specially constituted statutory body. There is no reason why the commission cannot consult the local authority associations and representatives of other bodies within jurisdiction, directly. This is the way that central government traditionally consult local government.

Clause 24 therefore replaces the representative body with direct consultation arrangements. The commissions will be required to submit copies of their annual reports to representatives of authorities within their jurisdiction, and allow sufficient time for them to comment before publishing their report. However, it no longer seems appropriate in these circumstances to require the commission to include all the comments received in the report itself. This right, currently enjoyed by the representative body, is quite an unusual privilege, and from a practical point of view, it would be difficult to continue these arrangements when divergent comments may be received from the proposed broader consultation base. I am sure that the local authority associations will, with their usual efficiency, find other ways of making their views known—vocally, if they need to—to a wider audience if they wish to do so. It is for those reasons that we resist the amendment.

5.45 p.m.

Baroness Serota

I am grateful to the Minister for his detailed reply. I entirely agree with him about the changed arrangements for the publication of the annual reports. That is agreed all round. However, I did not hear him reply in any way to the arguments put forward by my noble friend Lord McIntosh and myself about the use of the Consolidated Fund for the purpose of defraying the expenditure incurred each year by the commission. That argument was not mentioned at all.

Lord Hesketh

We believe the amendment of the noble Lord, Lord McIntosh, gives t he Secretary of State as big a role to play as the Government's own current clause does. We believe it is well established that the funding arrangements proposed by the Government will ensure that both central and local government, as well as the commission itself, will have a say. It is this tripartite arrangement which we believe will go so far as is possible to ensure the independence of the commission. That is why it is our preferred choice.

Baroness Carnegy of Lour

I think I understand what the Minister has just said. However, I wish to check that I have understood by asking whether, when the Minister refers to top-slicing the revenue support grant, he is saying that when the Secretary of State fixes the total amount for the revenue support grant, he adds the cost that we are discussing and then takes it away again and pays it to the commissioners? I believe that is what the Minister is saying; and from the way the noble Lord, Lord McIntosh, is smiling, I believe he agrees with me.

Lord Hesketh

The noble Baroness is entirely correct.

Lord McIntosh of Haringey

I accept, as the Minister said, that the amendment is technically defective. Therefore, I should say at once that I shall not seek to divide the Committee on it. However, I am very dissatisfied by the tone and content of the reply which has been given. It seems to me that what is being proposed is the worst of all possible worlds in that local authorities shall pay for the local ombudsman's services, just as they do now, but they shall have no effective say in determining what the expenditure will be. Further, they will have no very effective way of commenting on the work of the local ombudsman.

I was not defending the representative body. Not only was I not defending that body, but I was also assenting to the abolition of the representative body with the agreement of the local authority associations which have all agreed that the representative body is no longer the way to proceed. However, if we are to move away from the theory of local authority control which was established in 1974, we have to move to something which really establishes the independence of the local ombudsman. I though that our suggestion of using the Consolidated Fund on the analogy of other tribunals and other quasi-judicial bodies was the right suggestion. What we have now is a curious solution in which local authorities pay all the money and have nothing to show for it. This is rather like the late foreign Minister of Canada, Mike Pearson, who described diplomacy as persuading other people to do what one wants.

However, here local authorities are being given no opportunity to do anything other than have their rate support grant cut in order to pay for the local ombudsman. Let me make it clear that local authorities support the principle of the ombudsman. They do not agree with the other amendments that I have tabled, but they agree with this particular one. I should have thought it deserves more serious consideration than it has had up until now. I shall withdraw it, with the leave of the Committee, because it is defective, but I should like to have an opportunity to discuss the matter with Ministers between now and a later stage. I hope that they will agree that that could be helpful. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 23 agreed to.

Lord McIntosh of Haringey moved Amendment No. 114: After Clause 23, insert the following new Clause:

("Contractual matters and commercial transactions

.—(1) The Secretary of State shall, within three months of the date of passing of this Act, by Order repeal so much of Schedule 5 of the Local Government Act 1974 as relates to the exclusion from the jurisdiction of the Commissioner of actions taken by an authority relating to contractual matters or commercial transactions.

(2) The Secretary of State may by Order make such consequential amendments to Schedule 5 of the 1974 Act as are necessary for the purpose of this section.").

The noble Lord said: With this amendment we move forward in the Bill and slightly back in Widdicombe to paragraph 9.73 on page 221. It is not a very clear paragraph; I had to read it several times before I understood what it meant. I now think that Widdicombe was pointing out that there are some prohibitions on the jurisdiction of the local ombudsman which are not particularly desirable. The example taken up in the proposed new clause concerns cases involving commercial and contractual transactions.

Widdicombe was not convinced that cases involving commercial and contractual transactions with members of the public are different in kind from cases involving other local authority dealings with the public. I think that the Widdicombe Committee was not convinced that as a matter of general principle such dealings should be excluded from the ombudsman's remit. We agree. This new clause would reinstate contractual matters and commercial transactions into the jurisdiction of the commissioner and empower the Secretary of State to make such necessary provision by way of a repeal of the appropriate parts of Schedule 5 to the Local Government Act of 1974.

That is not a very dramatic change. Nevertheless, the view has been expressed by the commissioners that they have felt the lack of such jurisdiction. They have felt that it has restricted them, and presumably it has inhibited them from investigating cases of maladministration which they would otherwise have wished to investigate. It is with the support of Widdicombe and of the commissioners that I beg to move the amendment.

Lord Hesketh

The amendment would extend the ombudsman's jurisdiction to the investigation of commercial and contractual matters by requiring the Secretary of State to repeal paragraph 3 of Schedule 5 to the Local Government Act 1974 which at present specifically excludes such matters from the ombudsman's purview. The repeal would be made by order within three months of the date of the passing of this Act.

The primary concern of both the local and parliamentary commissioners is with the relationship between the executive arm of government and the general public. The local ombudsman is there to ensure that individuals who have suffered a grievance, or have a complaint against a local authority, are able to secure some redress without the need to go through the courts. Such provision is needed because local authorities exercise statutory functions.

Where, on the other hand, a local authority or other public body is involved in commercial transactions, such as the buying or selling of goods or services, it does so on the same basis and under the same conditions as other employers or contractors. We believe that there is no reason why special arrangements should be available to enable other parties to such transactions to seek redress. The law already provides stringent protection for individuals involved in commercial transactions and there is no argument for extending those provisions just because one of the parties concerned happens to be a local authority. Indeed, successive governments have rejected such an extension, and that is why we continue to do so today.

However, in the White Paper responding to the Widdicombe Report we undertook to keep under review specific areas where the commercial aspect might be regarded as secondary and where a council's tendering procedures involve non-commercial considerations. We are currently considering, for instance, whether the allocation of market stalls by local authorities should be brought within the local ombudsman's jurisdiction. Such changes can be made by my right honourable friend the Secretary of State under his existing order-making powers under Section 26(9) of the Local Government Act 1974, so that primary legislation would not in any case be needed to make such adjustments to the local ombudsman's jurisdiction.

It is for those reasons that we resist the amendment.

Lord McIntosh of Haringey

I suppose that I shall have to be satisfied with that response. The problem is that the Government are forcing local authorities to undertake more and more of their business in the form of commercial and contractual transactions. Therefore, if the Government have an opportunity to pursue that policy, more and more of the local authority's business would fall outside the jurisdiction of the local ombudsman. That cannot be desirable.

The case of market stalls is interesting. I was not aware of that point. I suppose that it is mildly reassuring to know that the Secretary of State has the power to vary subsection (3) of Schedule 5 by order if he thinks it necessary. Rather than prolong the debate on what must be to most Members of the Committee an intensely boring matter, I think it better that I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord McIntosh of Haringey moved Amendment No. 115: After Clause 23,

("Matters affecting educational establishments

.—(1) The Secretary of State shall, within three months of the date of passing of this Act, by Order repeal so much of Schedule 5 of the Local Government Act 1974 as relates to the exclusion from the jurisdiction of the Local Commissioner of complaints concerning administration in schools and colleges.

(2) The Secretary of State may by Order make such consequential amendments to Schedule 5 of the 1974 Act as are necessary for the purposes of this Section.").

The noble Lord said: With Amendment No. 115 we come to a matter which arouses a little more passion; that is, the question of the exclusion from the remit of the local ombudsman of all matters educational. The changes that are taking place in the management of our public sector education as a result of legislation are quite extreme. I shall not venture into the subject of the recent education Acts. The spread of responsibility from local authorities to governing bodies and the role of parents and outside members in governing bodies in my view means that the jurisdiction of the local ombudsman should not be extended to educational issues as a whole. They would be quite unqualified to deal with such matters. They are not educationists and would be second-guessing not only local authorities but also those who are involved in the professional aspects of education outside the local authorities. It is much better if we keep ourselves and the local ombudsman clear of that area.

However, there are areas in the educational sphere, in schools and colleges, which are administrative. They concern the way in which the rules of the local authorities with regard to administration are carried out and whether those rules themselves are fair and protect the interests of the ordinary citizen. They are matters which are strictly analogous to the administration of other local authority services which are within the remit of the local ombudsman. It seems to us—although not necessarily to the local authority associations—that that is an anomaly which could be remedied without intruding on more strictly educational matters. I hope that the amendment will commend itself to the Government and the Committee. I beg to move.

Baroness Carnegy of Lour

Perhaps I may ask the noble Lord whether he has in mind that administration, in terms of the amendment, includes the running of the school by the head teacher. If, in the view of a complainant, the head teacher is not administering the school properly, would he be caught by the amendment?

Lord McIntosh of Haringey

In so far as the administration of the school by the head teacher is within the scope of the education Act it would be excluded, because the education Act proposes ways of remedying maladministration by head teachers. The way that head teachers themselves are chosen could be an administrative matter. Decisions taken by local authorities on administrative matters, rather than by the head teacher, are matters which we consider to be analogous with administration of other local authority services. Where they are education matters and dealt with by the education Acts, we do not think that they should be included.

6 p.m.

Lord Hylton

I am inclined to think that the amendment is relevant to the recent education Act which provided for the devolution of quite considerable administrative matters from the education authority to the individual school. When that legislation comes into force, it will be a totally untested and untried area. It could go seriously wrong if schools are not given sufficient administrative personnel to do everything properly and those personnel are not properly funded. It would be in the national interest that the local government ombudsman should be able to look into those matters of administration. I am not talking about the quality of teaching or the subjects taught; I am talking about administration.

I recall that we debated the question of school records, affecting individual pupils in connection with an education Act of several years ago, although I am not quite certain which one it was. If those records get into the wrong hands and are not properly looked after or are destroyed when the child leaves school, they may affect that person's future career. That is an example of the kind of administrative matter with which we are concerned and which should probably be better protected than it is now.

Baroness Blatch

Perhaps I may inject into the debate a note of confusion in my own mind; namely, the distinction between what may well be a purely administrative matter and what may well be partly an education matter. It strikes me that, if one puts oneself in the shoes of the customer, an injustice is an injustice. If we put into effect legislation that at least allows for a grievance to be heard and an injustice to be righted, we should not be in the business of making distinctions. As more autonomy goes down to school level, it is important that the customer—the parents and/or the young person—has somewhere to go other than, occasionally, the local education authority which is in the business of defending its schools and its own responsibilities. There is therefore a case for there being recourse to the ombudsman. I see no reason for the exclusion or for the distinction.

Lord McIntosh of Haringey

Perhaps I may be allowed to speak again before the Minister replies. The noble Baroness has made an interesting point, but I am not convinced by it for the following reason. Parliament spent a great deal of time in 1986 and 1988 debating education legislation which, as the noble Baroness, Lady Blatch, rightly said, devolved a considerable amount of power from the local education authorities to head teachers and governing bodies. The basis of the existence of the local ombudsmen is that they deal with the responsibilities of local authorities and maladministration by local authorities. The Government's education Acts have sought to draw a distinction between what is the local authorities' responsibility and what is the responsibility within the schools. Whether or not they have drawn it correctly remains to be seen, but they have sought to provide remedies for injustice in our education establishments—our schools and colleges—where the local authority is no longer responsible for the detail of them.

I did not propose in this amendment—and I did not think it wise to propose in this amendment—to go against the 1986 and 1988 education Acts. If they are right, they are right. If they are wrong, then they are wrong. We shall see. They have not yet been fully tested, but it would be foolish to seek to extend the role of the local ombudsmen beyond the responsibilities of the local authorities, limited as they are now in education establishments.

Lord Hesketh

Like the previous amendment, Amendment No. 115 seeks to extend the local ombudsman's jurisdiction in this case to the administration of schools and colleges within the ombudsman's purview.

The ombudsman can already investigate some education matters such as allocations, grants, catchment areas and school buses. However, the local ombudsman is prohibited under Schedule 5 to the Local Government Act 1974 from investigating complaints about internal affairs of schools and colleges including curriculum, discipline, conduct and internal organisation. That is so because of the intrinsic difficulties in defining where the boundary lies between professional judgment and administrative action. The education function in the control and instruction of children is essentially professional and the administrative element cannot be easily hived-off to pin-point matters that might fall within the ombudsman's scope. As the noble Lord, Lord McIntosh, pointed out, it is also the case that there already exist various mechanisms for the handling of complaints about education concerns. For example, under Section 23 of the Education Reform Act 1988 local education authorities must establish local arrangements, approved by the Secretary of State, to deal with complaints about the school curriculum and related matters.

The amendment would therefore enable the ombudsman to encroach upon matters for which there is already an established complaints machinery, and where it would be inappropriate for him to intervene. That is why we resist the amendment.

Lord McIntosh of Haringey

I do not think that the amendment has effectively achieved its objective. As I read it again, I now realise that the word "administration" is difficult to define just as it is difficult to define in education Bills. I do not claim any greater wisdom than parliamentary draftsmen in this matter, but I do not think that I made it clear in drafting the amendment that it was the responsibilities which remain in the hands of local authorities that we intended to attack. I shall have to take the amendment away and think about it rather than ask the Government to take it away and think about it. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 24 agreed to.

Clause 25 [Implementation of recommendations of Commissioners for Local Administration in England and Wales]:

Baroness Stedman moved Amendment No. 115A: Page 31, line 42, leave out from ("he") to end of line 30 on page 32 and insert ("shall inform the person aggrieved in writing and that person shall have the right to seek an Order in the County Court requiring that the authority take appropriate action to remedy the injustice reported by the Local Commissioner and to prevent similar injustice being caused in the future.").

The noble Baroness said: We now come to the question of what happens when the ombudsman has considered a case of maladministration and has reported back to the authority which has declined to take any action on the ombudsman's report.

At the moment, where a case of maladministration is referred to the local ombudsman in England, Scotland and Wales, the local authority concerned is not obliged to take any action to remedy the situation. Its response is purely voluntary and it is under no obligation to redress any maladministration of which it may be guilty. While those rights are denied to complainants in England, Scotland and Wales, those suffering as a result of maladministration in Northern Ireland have recourse to the county court if the local authority refuses to act on the ombudsman's report.

In the House of Commons, during the Committee stage of the Bill, the Parliamentary Under-Secretary of State said that judicial or statutory enforcement would be "formalised, legalistic" and would involve "costly and lengthy investigations". That is nonsense. The system of county court redress works very well in Northern Ireland. It is instructive and interesting to compare the annual reports for 1987 of the Northern Ireland commissioner for complaints and of the Commissions for Local Administration in England and Wales. The English commission was concerned at what it described as the continuing increase in time taken to deal with complaints". The Northern Ireland commissioner states that the average time taken between receiving a complaint, investigating it and issuing a report is roughly 10 months, whereas the equivalent time in England is some 52 weeks or 12 months.

The ability of the complainant to seek redress in the county court does not seem to have produced any excessive litigation in Northern Ireland. Cases of maladministration over which the local authorities have refused to act are relatively few. In the period from the beginning of the service until March 1985, which is the last set of figures I have been able to obtain, only 6 per cent. of cases in which maladministration was found had not been settled. Few in number though they may be, in my view there are still too many such cases. A number of bodies throughout the country have taken an interest in the ombudsman system and have commented on the reasons why we do not opt for enforcement. In its 1984 review of the 1974 Local Government Act, the Commission for Local Administration in England called on the relevant Secretaries of State to urge all authorities always to provide prompt and positive remedies where injustice is found by a local ombudsman.

It went on to say that legislation should be introduced for the enforcement of remedies if a marked improvement were not made voluntarily in a reasonable time. It recommended the Northern Ireland system as a model that might perhaps be followed.

In his annual report for the same year the ombudsman for Scotland concluded that statutory provision for enforcement had become necessary. He said: My predecessors and I have been very reluctant to come to this conclusion, feeling that it was much better to retain the voluntary system as long as failure to comply was a rarity, but the time has now come to say that the voluntary system is not working adequately".

The Welsh local ombudsman in evidence to the Widdicombe Committee wrote: It is intolerable that any injustice caused by maladministration identified in the course of an objective and impartial investigation should be allowed to go unremedied".

The Widdicombe Report itself suggested that where a complainant was dissatisfied with the remedy offered by the local authority one should look at the system in being in Northern Ireland. Indeed, the Select Committee on the Parliamentary Commissioner for Administration in another place took evidence from public bodies, local authority representatives and government Ministers. It concluded in its report: We consider that the best method of providing support for the local ombudsmen's reports would be for our remit to be extended to allow the possibility of our calling recalcitrant local authorities to account. If experience showed that our involvement did not, however, have an improving effect on the treatment of the reports of local ombudsmen, we would recommend serious consideration of the involvement of the courts". All those people looked at the Northern Ireland situation and at the few cases in which there had not been agreement and where local authorities had not acted.

In July 1988 in the White Paper on the Widdicombe Report, the Government concluded that non-compliance with the local ombudsman's report, which the Government then put at a rate of 5 per cent. served, to produce a particularly marked sense of grievance on the part of the complainants, as well as undermining the credibility of the local ombudsman system as a whole".

The National Consumer Council has taken that view from as long ago as 1982. It says that, the Northern Ireland policy has not released a flood of applications to the courts, for the existence of the powers of enforceability seems to result in compliance

It acts as a deterrent to those authorities who do not want to take any notice. Yet the local ombudsman in the latest annual report for 1988–89 makes clear that some authorities are still, as he puts it, "stubbornly refusing" to remedy injustices found by the local ombudsman. As the report says: Councils which hold out against putting right the wrongs they have done are failing in their duty to the people they are supposed to serve".

I contend that they are also giving local government a bad name. It is time that the ombudsman was given some teeth: this amendment is one way of doing so. I beg to move.

6.15 p.m.

Lord Hayter

By purest coincidence, I read in the newspapers over the weekend of exactly the situation the noble Baroness has just described. The ombudsman said in his report that although he complained last year about the action of a local authority no remedial action had been taken; therefore, he could only again draw attention to the incident and hope for the best. I support the amendment.

Lord McIntosh of Haringey

This is probably the most difficult and contentious issue to face the Committee in dealing with Part II of the Bill. It is certainly true, as the noble Baroness said, that enforceability of the ombudsman's findings through the county court is established in Northern Ireland; it does not involve an increase in court cases nor extend the length of the inquiries. And it is supported by both the commissioners themselves and Widdicombe.

However, I want to sound a note of caution. It is not related to any of the remarks of the noble Baroness. If the ombudsman's conclusions were to be enforceable in that way, it would have an effect not on the length of the investigation but on the way in which the investigation is conducted. The work of the local ombudsman would become in effect the tribunal: it would have to be subject to the rules of the Council on Tribunals. In the view of a number of people who have advised me (for example, from the ranks of Justice, which was always in favour of enforceability in the past) that could well damage the ability of the local ombudsman to conduct a wide-ranging investigation without too much concern for the quite rightly restrictive rules of the Council on Tribunals.

That is an issue to which the noble Baroness did not refer when she moved the amendment. It makes me not just doubtful about the wisdom of what she proposes but in the end, after very careful consideration, reluctant to agree with it. I am sorry about that. I do not like to go against the noble Baroness. I respect her judgment on these matters. I respect too the view held by the commissioners and Widdicombe. But, on balance, I think that we should lose more than we should gain if we went over to enforceability.

Baroness Blatch

I sympathise with the principle of the amendment. I do not know whether or not it is technically correct. However, the one argument used over the years (with which I agree) against any kind of sanction beyond that of printing in the local press that the local authority has refused to comply with the recommendations of the local ombudsman has been that the number of recalcitrant local authorities is so small that it is better to leave these matters to the voluntary system.

Let us take the figures given by the National Consumer Council and used by the noble Baroness. I believe they are the same as those that I have. Of 145 cases between 1974 and 1989, 97 continued not to comply, which represented 21 per cent. of those who were found at fault. That is a considerable number.

I am concerned about anybody who is aggrieved, who has gone through the pain of speaking informally to the local authority to try to resolve an issue and who, having taken the matter to the ombudsman, has obtained a first hearing in which the authority has been found wanting but has then had to wait many more months while a second application is made to the ombudsman and again found that the authority is declared wanting.

I told the Chamber at Second Reading of an instance when I first came into local government. I took my local authority to the ombudsman and twice it was found wanting. At the end of the day my local authority said that it was going to run the local authority its way and that it would not be told how to do so by the ombudsman. I felt that the aggrieved parties in that situation had absolutely nowhere to go. There was no sanction whatever against the local authority. However small the number of people who are aggrieved, one needs to have the long stop of being able to go to a court to say that there has been a judgment on the local authority, not once but twice, that it has been printed in the local press and that still the local authority is not prepared to comply with recommendations. There ought to be some sanction against the local authority.

The point made by the noble Lord, Lord McIntosh, is correct. If one moves into that sphere a right of appeal for the local authority is appropriate. I am not sure that the amendment is correct in every sense. However, I very strongly support the principle that where a local authority has been judged wanting by the local ombudsman, not once but twice, there ought to be somewhere for the aggrieved person to go. I believe that it has to be the courts.

Lord Ross of Newport

Does the noble Baroness wish to speak first? She has great knowledge.

Baroness Serota

No.

Lord Ross of Newport

I have great sympathy with the amendment. I shall listen to the Government's response with some interest. My experience agrees very much with that of the noble Baroness, Lady Blatch. With regard to a health matter, the ombudsman was so disgusted that the area health authority would not pay compensation of about £40 that he took the matter to a committee in another place presided over by Sir Anthony Buck, the Member for Colchester, North. It is a committee which has some strength. I vividly remember the chairman of the health authority and the chief executive sitting in the corridor outside one of the committee rooms worried that they were going before the committee. In the end the authority paid up. It was absolutely ridiculous that the matter had to be taken to such length. If it had not been for the ombudsman's initiative it would not have gone that far.

That is one resort. I believe I am right in saying that the committee in another place can put some pressure on local health authorities and others in the worst cases to do something. If at the end of the day they still refuse to act, I gather that they cannot be made to pay. I wish that the noble Baroness, Lady Serota, had spoken first. I have sympathy for the amendment. It is absolute nonsense that in many cases local authorities have not paid what they should rightly have paid to put matters right.

Baroness Serota

Like all other noble Lords who have spoken on this amendment, I have great sympathy for the case that the noble Baroness, Lady Stedman, has put to the Committee about the enforceability of the ombudsman's findings. The account that she gave of the different recommendations that are made from time to time on this subject were absolutely accurate.

However, like the noble Lord, Lord McIntosh of Haringey, I accept that if the proposals in this amendment were carried into the Bill they would undoubtedly affect the way in which ombudsman investigations were carried out. Above all, I believe that they would affect the way in which local authorities responded to the investigations. In the interests of natural justice, if one has an authority able to impose a solution on any individual, surely in all conscience he must have a right of appeal. Therefore as the noble Lord, Lord McIntosh, said, we are in an area similar to that of tribunals, with all that that means.

I have always believed that ombudsmen—be they local or parliamentary—should act wherever possible informally and through the conciliation process in order to bring justice where maladministration has been found. I know that I differ from my successor commissioners who have recommended the Northern Ireland procedure. But I believe that at this stage we should accept the proposals of the Government to strengthen the public impact of the local ombudsman's findings and not introduce into the Bill a provision where an appointed individual—the ombudsman is an appointed individual—however distinguished and impartial, would be given the right to impose his view and findings on an elected authority. One can see the difficulties in that situation.

In my knowledge, with the exception of Northern Ireland, no classical legislative ombudsman system in any other country in the world has that authority. The ombudsmen must work by consent. They must work with the co-operation both of the body that is under investigation and of the complainant who feels that he has suffered an injustice. If I had my way the Bill would include powers of conciliation for the local ombudsman. I accept that that may be going a bit far. But ideally we should work by consent and co-operation in this field if injustice is really to be remedied. That is why I welcome the commission's current annual report which points out that 13 per cent. of the complaints that it has considered are settled locally. That is the direction in which we should go rather than in the direction of the courts, with all that is involved in court procedures.

I look forward with interest to hearing what the Minister says about the amendment. If the new provisions in the Bill do not work, and if the rate of non-compliance rises, we shall have to produce an enforceable system. I would deeply regret it, but such time must surely come if local government does not see the red light on this occasion.

Baroness Carnegy of Lour

With my very much more limited experience, I should like to support what the noble Baroness has said. The atmosphere and style of the ombudsman system has enormous value. The trouble is—and it is very much felt at the receiving end by the person who has a complaint —that the adverse publicity for the local authority is often not enough. As I understand it, the Bill is strengthening that position. Much more will be printed in the press about maladministration. There ought therefore to be an incentive to councillors who are in a position to do so to criticise their authority for what it has done. There will be a chance for other people to take the matter up in the public domain. Much more will therefore happen.

However, if the provisions in the Bill do not work and it continues to be impossible for people to have redress from the local authority, Parliament should go further.

Lord McIntosh of Haringey

I have a compromise to suggest to the Minister. Why not have enforceability only in the City of Westminister?

Lord Hesketh

It would be some form of pilot scheme. With my hand on my heart, this is the first time this summer that I have been able to say what a great pleasure it is to have had the case supported by such an eminent figure as the noble Baroness, Lady Serota. It is a very difficult area.

The amendment which the noble Baroness, Lady Stedman, has put before the Committee would remove the provisions in Clause 25 requiring local authorities who decide not to comply with a local ombudsman's further report to publish a summary of his findings in local newspapers and replace them with a power for the aggrieved person to seek an order in the county court requiring the authority to remedy the injustice and prevent similar injustice being caused in the future.

This raises fundamental issues about the role of the local ombudsman which have recently been considered by the Widdicombe Committee, and by the Select Committee on the Parliamentary Commissioner for Administration. Both committees concluded that more needed to be done to improve the rate of compliance with local ombudsman recommendations, which is currently running at about 5 per cent. of cases where injustice due to maladministration is found. That may not sound very many for a voluntary system, but these failures produce a particularly marked sense of grievance and they tend to undermine the credibility of the ombudsman system as a whole.

I therefore have a great deal of sympathy with what the noble Baroness is trying to achieve with her amendment. However, I do not think that it is quite the right approach. I agree wholeheartedly that all local authorities should comply with local ombudsman recommendations, whether or not they agree with them. Although the local ombudsman is not a judge sitting in a court, he acts as an independent arbiter between the complainants and the council. He will have carried out a full and thorough investigation of the facts.

It is presumptious of any council in these circumstances to say that it knows better: one must accept the umpire's decision. To do otherwise undermines the whole credibility of the ombudsman system and compounds the sense of grievance of those who complain.

Judicial enforcement of remedies is not the answer, simply because they bring the court and the judge into the process and the benefits, of an informal system are immediately lost. I know that the noble Baroness will be disappointed when she hears once again the words concerning investigations that, we believe, if the amendment were accepted, would immediately become more formal, legalistic, lengthy and expensive. Moreover, we believe that local authorities would challenge the facts at every opportunity. Moreover, it would no doubt engender a negative, defensive and unco-operative attitude in local authorities, especially among those who are presently prepared to abide by the ombudsman's decisions despite not being in agreement.

We have in Part H introduced measures to require timely and thorough consideration of the ombudsman's reports, together with a requirement that local authorities who decide not to comply with the recommendations contained in a further report should publish a summary of the local ombudsman's conclusions. The combined effect of these measures should encourage more local authorities to comply with the recommendations of the local ombudsman. As the noble Baroness, Lady Serota, has pointed out, we very much hope that they will work and thus remove the problems that are now perceived. It is for those reasons that we resist the amendment of the noble Baroness, Lady Stedman.

6.30 p.m.

Baroness Stedman

I feel some disappointment and draw some encouragement from the Minister's reply. I accept the point that the noble Lord, Lord McIntosh, made; it is good and valid and one which I had not considered too deeply. I shall certainly consider it again. I am worried that some who have spoken in the debate say that if this does not work we shall have to go for enforcement. That would go on and on and we should have to find another Bill or another means of including that enforcement. However, I accept that it is a difficult problem.

I accept also that only a few councils do not abide by decisions of the ombudsman. My understanding from someone who has been involved in the work is that, contrary to what one might have expected, it is not the big militant authorities who do not comply. They do; they take their jobs and the criticism seriously. It is more likely to be the smaller authorities where there is a much closer officer/member relationship than in the bigger authorities. But even so I deplore the fact that there is this small minority of authorities who do not accept the judgment when it is placed upon them.

However, I should like to read what has been said and in the meantime I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 25 agreed to.

Clauses 26 to 28 agreed to.

On Question, Whether Clause 29 shall stand part of the Bill?

The Earl of Balfour

This is the first time that I have had an opportunity to join in the debates on the Bill because I have been completely tied up with a few things at home. In Clause 29 the exact terms of the declaration of acceptance of offices by councils should be included in the Bill and not left in the rather vague terms under the new Section 33A of the Local Government (Scotland) Act 1973.

I should like to raise one other point which I feel might be of concern to all sides of the Committee. Unfortunately our electorate can sometimes elect people, for whatever reason, from the extreme Left, let us say, communism, or from the extreme Right, such as the National Front. Clause 29(3)(a) reads: two members of the local authority to which the declarant is elected". Could two members of the National Front slip through the net and support one of their own if a third person was elected? Otherwise I approve of the clause. That is the only point that I wanted to make.

Lord Hesketh

Under the new Section 33A to be inserted in the 1973 Act, the form of declaration is to be described by order rather than by the election rules. We have taken the point that the form of the declaration to be made within a period of two months after an election cannot appropriately be prescribed in the rules for the conduct of elections. But as regards the terms of declaration that should be in the Bill, those terms have always been prescribed in subordinate legislation and we see no reason to change that.

The Earl of Balfour

I am most grateful. I believe the other points can be met.

Clause 29 agreed to.

Clauses 30 and 31 agreed to.

Clause 32 [Promotion of economic development]:

Lord Graham of Edmonton moved Amendment No. 115B. Page 38, line 41, leave out ("Subject to sections 33 and 34 below").

The noble Lord said: I also speak to Amendments Nos. 115C and 115J and, as the Marshalled List indicates, I also speak to the intention to move that the clause do not stand part of the Bill.

To set the scene, because these amendments are part of a piece, I should like to remind the Committee that Clause 32(1)—this is the area of the Bill that deals with economic development and discretionary expenditure by local authorities—reads: Subject to sections 33 and 34 below, the functions of every relevant authority shall include the taking of such steps as they may from time to time consider appropriate for promoting the economic development of their area".

The important words there are: Subject to sections 33 and 34 below".

In reading that one might say "Well done" to the Government. They are keen to expand the promotion of economic development in the local authorities, subject to Sections 33 and 34. Section 33 is sidelined: Restrictions on promotion of economic development".

So on the one hand the Government hold out the prospect to local authorities that they will be given powers to engage in promoting economic development within their areas. But Clause 33 says "Just a minute", on the other hand there are restrictions. Clause 33(1) reads: The powers of a relevant authority by virtue of section 32 above, and their powers by virtue of other enactments, shall not include power, for the promotion of the economic development of their area, to take any such steps as may be specified or described for the purposes of this section in regulations made by the Secretary of State. Subsection (2) contains a similar provision.

Either the Government are in the business of encouraging local authorities to engage in activities designed to expand the economic development of their area, or they are not. Over at least the past five years we have seen a range of initiatives by local authorities of all political persuasions. They have recognised that the Government have a number of commendable initiatives of which they are proud and in the macro-economic situation they seek to make them available in a nationally planned and organised state.

However, there are also other considerations. Both small and large local councils have been engaged primarily in economic expansion in order to create work. Many jobs have been created by local initiatives. The estimate of the cost of the jobs created by the Government's regional policy and enterprise zone initiatives has been estimated at £30,000 per job. The cost of jobs created by local authorities ranges between £3,000 and £5,000.

If the Government are serious about wishing to create a climate in which jobs are encouraged and produced, it is cheaper to do so by providing the local authorities with the powers. I am not talking about the money and so forth, but about the powers. On the one hand the Bill concentrates on giving the semblance of providing the powers, but on the other hand it takes them away.

I live in Edmonton which is in the London Borough of Enfield. Other nearby local authorities are either Conservative or Labour. They are all engaged in trying to fill the gap left by central government planning. They know more about the local situation than the central or regional planners. I am puzzled about why the Government believe that it is right and proper to constrict the ability of local authorities to do what I consider to be a good job.

The local authorities have the responsibility to maintain a buoyant economy by attracting new firms and assisting local firms. I suspect that Enfield is no different from boroughs of different political persuasions; they are all desperately keen to retain the viability of existing local firms. The authorities have a number of ways in which they can do so. They can provide first-class liaison between the schools, the civic centre, the Chamber of Commerce and so forth. Enfield has a most satisfactory record in that regard.

The authorities must also recognise the need to build factories and other workplaces which will act as an inducement to people outside the area. They are competing one against the other. I fail to understand why the Government are acting in this way.

My part of the world may not have suffered as badly as others regarding the number of closures. The industrial town that I know from my boyhood is Jarrow, concerned with shipbuilding. In the past 10 years we have seen the closure of the steel plant in Consett. There have been other places where the catastrophic closure of one industry has affected the whole community. It is the job of local councils to be sensitive to closures. They just make sure that other initiatives are considered and taken before a factory closes as a result of being rationalised out of existence.

Can the Minister say what will be left to the local authorities? He may well say, "It's all very well, but we believe that the council is limited in its ability to be the best judge of spending capital and investing money. There are other people who can do it better". W are not engaged in an argument about who can do things better. The Government, regional government, enterprise zones, development agencies and the urban development corporations can do things better in their way. There is a place in which the local council can do things better. I make no political point and hope that noble friends will not do so. I believe that most local councils which wish to spend money in such a way are properly motivated by their desire to ensure that local people are provided with opportunities for work.

It is disappointing that at a time when the Government are attempting to tackle the problems of the inner cities and advocating closer working between the private and public sectors, and when the UK looks likely to lose out in terms of the availability of EC structural fund assistance, they appear not to be acting in the best interests of maintaining a buoyant local economy. That is particularly so when one looks at the provisions contained in Clauses 32, 33 and 34.

We plead with the Government not to damage the partnership between central and local government which all too sadly has been damaged in other ways. We ask them to encourage councils by giving them powers to assist the local economy when they can see an opportunity but which is not provided for in the Bill. I beg to move.

6.45 p.m.

Baroness Carnegy of Lour

It is excellent that the Bill encourages local authorities to have more scope to contribute towards the economy of their areas. The noble Lord, Lord Graham, described what he believed to be wrong with the Bill and wishes to leave out two clauses which limit the powers of local government. I believe that the two clauses are essential in enlarging the scope. His speech sounded like one made in the late 1970s or early 1980s when local government had to be the entrepreneur and go into competition with the private sect or in the local area. We now know that does not work because competition between local government and the private sector damages the private sector. It is made more difficult for the local market to work because the authority is in a special position.

However, there is now an important role for local authorities in the local economy. It is to operate in the same way as the Scottish Development Agency now operates: as an enabler of the private sector, The local authorities must be enablers and make it possible for private industry to operate freely in the area and create jobs. There is a great deal that the local authorities can do in that respect.

If they are not prevented from expanding into the private sector they will not assist the economy in the modern setting. Local government can only do what legislation says it can do and cannot go beyond that. It is difficult to set out in legislation all the details of what local government can and cannot do. These clauses are an attempt to make it possible to control that. The clauses are important in the modern setting. It would not have been important 10 years ago, but now it is important to word clauses as in this instance. I hope that they stay in the Bill.

Lord Renton

We are in a rather unusual position. We are discussing the possible omission of two clauses—Clauses 33 and 34—and doing so on a necessary paving amendment to Clause 32. We cannot complain about that; however, we should be clear about what we are up to.

It is interesting and helpful that the noble Lord has put down on the Marshalled List at the end of the amendments to Clause 33 notice of his intention to oppose the Question that Clause 33 stand part of the Bill. Although it is clear from his speech and from his paving amendments that he also wants Clause 34 left out, the noble Lord has not indicated on the Marshalled List any notice of his intention to oppose Clause 34. Perhaps after all, in spite of his paving amendment, he does not intend that that clause should be left out.

I endorse what has been said by my noble friend Lady Carnegy of Lour. I should have thought that the noble Lord would be reassured by, and would rejoice over, Clause 32(3) which makes it perfectly clear that the relevant authority will be able to make a grant, a loan, a guarantee or an indemnity to anyone who is going to be economically active in its area, or invest in that person's undertaking. That is very forthcoming on the part of a Conservative Government who believe in private enterprise but who nevertheless are willing for local authorities to have a stake in private enterprise and various other things.

I should have thought that there must be some limit to the exercise of the powers in Clause 32. There must be some kind of financial limit. Are we to accept the possibility that local authorities will be majority shareholders in the undertakings in which they may invest? I would not be surprised if the Secretary of State, using his powers under Clause 33, said, "Yes, useful investment, but we do not want them running local industry to the extent of becoming majority shareholders". These powers could be used on a wide scale. The Government must have the power in the national economic interest, especially if there is a threat of inflation, to limit the total amount of funds spent by local authorities on these matters.

To say that the splendid Clause 32, about which we can all rejoice, stands on its own without any limitation on the powers to be used in pursuit of it seems unrealistic. Realistically, there must be some kind of ministerial responsibility regarding the financial extent to which the powers are used. That is why we must have Clause 33. Bearing in mind that the noble Lord has not expressed his intention to oppose Clause 34, I consider that the guidance and consultation about promotion and economic development referred to in the side heading—amounting to a description of some of the clause—could be helpful to local authorities. Speaking for myself, I would not wish to see the terms of the clause omitted.

Lord Ross of Newport

On first seeing these clauses I welcomed them very much. In many parts of the country it is to local government that people turn at times of difficulty. It could be the closure of a major business or sudden high unemployment.

I was serving on an authority in 1971 when such an incident occurred. Our third largest employer closed down and the unemployment rate rose to 18 per cent. I did my best to persuade the Government that we should become an assisted area. That was, and always has been, refused. The only help forthcoming was from the development commission, but that is now drying up. Therefore, the local authority dealt with the situation. All parties were involved in combating the situation. What we did was very much in line with these clauses although I have to say that it was in the teeth of opposition from the then county treasurer who did not believe that local government should be involved.

We set up an enterprise agency which I chaired. All the other members were from private enterprise businesses which had put money into the project. I should like to put on record all the help we received from BP and Lloyds Bank in that respect. More recently a development board has been set up, originally chaired by a Lord Lieutenant and now by an industrialist. It is doing extremely well. That would not have come about if the local authority had not taken the initiative. Not a large amount of money was involved—between £300,000 and £400,000, I imagine. Looking at these clauses that would be about the limit we would be allowed if the same thing were to happen today.

I should like to put on record that our second largest employer in the Isle of Wight is Plessey. If Plessey is to be the subject of a takeover bid it would be disastrous for the economy of my former constituency. Under any such merger we do not believe that the company will be maintained in the way it is now. The chairman and managing director of Plessey in the Isle of Wight have played a major role in stimulating the economy, helping the schools, in training and in very other way. It is due to pressure from the development board, and from the Plessey Company in particular, that we have our own technical training area, for which we have fought very hard and which has just been granted to us. It is important and fully backed by industry.

I see local government as encouraging enterprise—not overbearing but putting money where necessary on behalf of the ratepayers and promoting initiatives. We have been able to do that because to a large extent the people on the island accept that what has happened has been through local government initiatives.

I should have indicated earlier my intention to speak on Clause 34 stand part. There is one part I wish to raise on the clause that I hope the Minister can deal with. I disagree totally with subsection (2) that local authorities should determine at the beginning of each financial year whether they will take any steps in the year for the promotion of economic development in the area. How on earth can they do that? These events suddenly occur. A closure happens overnight. An American multinational can suddenly decide to close a factory. It has happened on a couple of occasions in Scotland recently. Suddendly there is disaster. It may be that the local authority has made no preparation. I will raise this later in the Bill. But are we actually saying that local authorities cannot do anything until the beginning of the next financial year? That would be totally mad.

Apart from that, and subject to other later amendments, I welcome the clauses. I hope however, that we shall amend those that are too restrictive. However, they set a pattern which I accept is an innovation for this Administration. There are restrictions but, on the whole, the clauses are to be welcomed. There are some areas that I certainly want to see changed. I specify one in particular because the amendment refers to taking out Clause 34. A part of Clause 34 is a total nonsense, and I give notice that I shall refer to that again.

7 p.m.

Lord Elton

Very briefly, I advise my noble friend the Minister that if he is for a moment entertaining the idea of withdrawing the power to restrict the economic involvement of the local authorities in this way, he should consider the history of the metropolitan authorities when approaching their conclusion. They demonstrated dexterity and vigour in applying local authority funds to all kinds of sectors that went far beyond what could have been the intention of the legislation under which they did so. Therefore, while it is a regrettable fact it is a necessary one that the Secretary of State should have power to restrain this employment of money if it appears to be inappropriate.

Baroness Blatch

I wish to add one point to what was said by my noble friend Lady Carnegy, who spoke in favour of the limitations, as indeed did my noble friend who has just spoken. I think that is right. The other point I wish to make is that I do not believe that local authorities should be frustrated by the limitations set out in Clauses 33 and 34. The one provision that local authorities can make to promote the economy in the area is to provide good services. The provision of good schools, the building and maintenance of roads and the provision of other services does as much to promote the economy of an area as the provision of direct promotional activities. Therefore I do not believe that there should be a frustration. The limitations are important.

To cover the point raised by the noble Lord, Lord Ross of Newport, and the case of a large company going out of business and causing the kind of repercussions he has outlined, as regards Plessey, I believe the Government's record of bringing assistance into play—one only has to think of Corby, Consett and other instances—with a co-operative approach to a crisis is preferable to building something that is the norm on the face of the Bill for the everyday management of local authorities. I do not believe that there needs to be frustration about the limitations set out in Clauses 33 and 34.

Lord Hesketh

These amendments are intended to provide that the power for local authorities to incur expenditure in the promotion of economic development is placed on the statute book without any limitation. The amendments effectively delete references to Clause 33 of the Bill, which would enable the Secretary of State to make regulations to limit the scope of the very broad power given to local authorities under Clause 32(1) and Clause 34, which sets out the consultation procedures with the local business community.

These amendments attempt to attack the heart of the new power. The basic principle behind our proposal was to give local authorities a specific power to promote economic development in their areas. If I may explain a little of the background to our decision it will be easier to see why we did not merely give local authorities an unqualified enabling power, and how flexible the new power will be in practice.

As the Committee will be aware, the decision to introduce such a power stemmed from the review of the proper role of local authorities in economic development which we carried out on the recommendation of the Widdicombe Committee. Our review concluded that local authorities were using a wide range of specific functional powers and their discretionary spending power to carry out an equally wide range of activities in the economic development field. Their activities included grants for enterprise boards and for individual firms; funding of training schemes; capital investment in starter and other individual industrial units and general and specialist advice to potential businesses.

I could go on, but I am sure that ':he Committee can see very clearly from those activities which I have already mentioned that the Government's conclusion was that local authorities had a very important role to play in promoting economic development. Indeed, in many cases local authority economic initiatives have been an important element in the success of central government policies. My own department's urban programme schemes, for example, require an input by local authorities.

Hence the decision to introduce a specific power for local authorities which it is hoped will give them a clearer footing on which to undertake their activities. However, while our investigations confirmed our view that local government had a vital role to play here, they did at the same time demonstrate that there was some lack of direction in some areas of activity and that there was a need for a economic activities by local and central government and the private and voluntary sectors to be complementary rather than competitive with each other. It was clear that where faults did exist these were exacerbated, if not caused, by the fact that local authorities had no clear powers to promote economic development and hence no parameters within which they could carry out their programmes.

The intention of Clauses 33 and 34 and the regulations which we will be making is to set the new power in as clear a context as possible in order to focus the activities of the authorities to best effect. While we have said many times that we have no intention of hindering local authorities in the useful work that they do in this field, there are undoubtedly areas in which we do not think it appropriate for them to be involved. There are examples of best practice in terms of organising a programme of activity which we think it important for local authorities to follow. Thus, as I think the Committee will agree, it would be very odd to hear that a local authority had set itself up as a manufacturer. There are others far better placed to do so. I cannot see how such activities could or would be appropriate to encouraging economic development in a particular area.

We have made no secret of our intentions as regards the probable restrictions on the power. From the beginning when details of the power were announced in another place we set our cards on the table. Furthermore, the usual consultations that precede the making of such regulations began as far back as January. Three meetings have already taken place between officials and the local authority associations and I am pleased to say that we will very shortly be issuing a consultation paper on these matters.

As regards the procedural items in Clause 34, which the amendments seek to make ineffectual, there is nothing here that any sensible authority would not be doing already. It is only common sense to draw up a clear strategy before embarking on expenditure at the ratepayers' expense and to ensure that any programme of work is complementary to the policies both of central and local government. We shall talk in more detail about this on later amendments, but I cannot see how such requirements will restrict any authority in exercising its powers under Clause 32.

We shall also discuss in other amendments the more detailed aspects of the restrictions that will apply to the new power. It is not our intention to restrict authorities' use of the new power unduly. We have discussed all these matters quite openly and extensively with those concerned and discussions will go on. I can assure the Committee about our intentions as regards the new power. As my noble friend Lord Renton pointed out, it would be quite impossible for the Government to provide a Bill which has enormous flexibility but is without any form of control in order to provide opportunity for local authorities. For that reason, we resist these amendments.

Lord Graham of Edmonton

I am conscious that I stand between the Committee and pleasure. Therefore I shall not take as long as I might otherwise have taken. This is a big issue. The Minister was quite right and fair to say that these amendments go to the heart of this part of the Bill. I make no apology for that. What puzzles us is that by the whole range of measures and changes in the controls that the Government exercised over local government before this Bill and these clauses came to be, it was very difficult for local authorities to do very much that did not have the approval of central government.

This Bill and these clauses are studded with phrases such as, "subject to regulations", "subject to matters that may be specified", and "regulations made by the Secretary of State". There are also references to, transitional provisions in connection with other provisions as the Secretary of State considers appropriate". It is a fact that before very long nothing will move on the face of local government that has not been expressly authorised, never mind generally authorised, by the man or woman in Whitehall. That is why we are protesting in this manner.

The noble Baroness, Lady Carnegy, was quite fair in saying that what she objected to in the success of local government enterprise was that it competed with private enterprise. As such she does not like the idea that if there was to be a loser it might be private enterprise even though the winner was municipal enterprise. She is saying that local enterprise from the council is all very well provided it is not too strong or too successful as a competitor with local private enterprise. The noble Baroness, Lady Blatch, nods her head in support as vigorously as she can with decorum from a sitting position.

Lord Jenkin of Roding

Surely the point here is that a local authority cannot go bust. It is very unfair competition if a local authority which cannot go bankrupt competes with traders which can. That is something which traders up and down the country have found when they have had to compete with local authorities in areas such as funeral services and so on. It is damned unfair competition. If the regulations deal with that, they will be performing a notable service.

Noble Lords

Hear, hear!

Lord Graham of Edmonton

I gather from the chorus of "Hear, hear" from the other side of the Committee that what private enterprise does not want is competition; and certainly not from municipal authorities. Most small local businesses want to become big local businesses and ultimately gobble up everyone else. We do not want to provide unfair competition. We want to provide what the Minister himself wants, which is flexibility for local government where it finds that there is a need to act quickly in order to protect the local environment.

The noble Baroness, Lady Blatch, said that she wanted the co-operative approach in these matters. She will be well aware, because she follows these matters closely, that the Labour Government set up the Co-operative Development Agency in 1978. The Government have just announced that it is to close. The Co-operative Development Agency stimulated the co-operative approach in many ways and created work which needed the stimulation of a local council. I have before me its last annual report which contains very good work. The Government have rewarded the CDA by closing it down. That is what the Government mean when they talk about these matters. The Minister says that a consultation process is going on and that a paper is likely to be published. I should like to believe that those who are being consulted are of a like mind with the Government on the ways in which they will be further hog-tied in respect of their flexibility.

Nothing in what the Minister said has encouraged me one iota to believe that the Government are serious in wanting to stimulate initiative and enterprise in local councils where it is required. The noble Lord, Lord Jenkin, referred to funeral services. That hare was run a few years ago. That hare is not running at this time. The noble Lord is fighting the battles of 1982, 1983, 1984 and 1986 which he lost when he was tackling a great many areas of local government. The Bill sets out to ensure that anything which moves at a local government level can move only with the approval of the Secretary of State. That is why I intend to seek the opinion of the Committee on Amendment No. 115B. I commend the amendment to the Committee.

7.12 p.m.

On Question, Whether the said amendment (No. 115B) shall be agreed to?

Their Lordships divided: Contents, 38; Not-Contents, 83.

DIVISION NO. 2
CONTENTS
Ardwick, L.	Lovell-Davis, L.
Broadbridge, L.	McGregor of Durris, L.
Carmichael of Kelvingrove, L.	Mclntosh of Haringey, L..
	Mason of Barnsley, L.
Carter, L. [Teller.]	Nathan, L.
Cledwyn of Penrhos, L.	Nicol, B.
Dean of Beswick, L.	Phillips, B.
Dormand of Easington, L.	Pitt of Hampstead, L.
Elwyn-Jones, L.	Ponsonby of Shulbrede, L [Teller.]
Ennals, L.
Falkender, B.	Prys-Davies, L.
Fisher of Rednal, B.	Stedman, B.
Gallacher, L.	Strabolgi, L.
Galpern, L.	Taylor of Mansfield, L.
Graham of Edmonton, L.	Turner of Camden, B.
Houghton of Sowerby, L.	Underhill, L.
Jeger, B.	Walston, L.
Kagan, L.	Whaddon, L.
Kirkhill, L.	White, B.
Lockwood, B.	Williams of Elvel, L.

NOT-CONTENTS
Arran, E.	Elliott of Morpeth, L.
Auckland, L.	Elton, L.
Balfour, E.	Fraser of Carmyllie, L.
Bauer, L.	Gray of Contin, L.
Belstead, L.	Gridley, L.
Blatch, B.	Haig, E.
Blyth, L.	Hailsham of Saint Marylebone, L.
Borthwick, L.
Boyd-Carpenter, L.	Halsbury, E.
Brougham and Vaux, L.	Harmar-Nicholls, L.
Caithness, E.	Hayter, L.
Carnegy of Lour, B.	Henley, L.
Carnock, L.	Hesketh, L.
Carr of Hadley, L.	Hives, L.
Coleraine, L.	Holderness, L.
Colville of Culross, L.	Hooper, B.
Craigavon, V.	Hylton-Foster, B.
Crickhowell, L.	Ingrow, L.
Davidson, V. [Teller.]	Jenkin of Roding, L.
Dundee, E.	Johnston of Rockport, L.
Elliot of Harwood, B.	Joseph, L.

Kaberry of Adel, L.	Penrhyn, L.
Kenilworth, L.	Rankeillour, L.
Kinloss, Ly.	Reay, L.
Lauderdale, E.	Renton, L.
Lawrence, L.	Romney, E
Lindsey and Abingdon,	St. John of Bletso, L.
Long, V. [Teller.]	Sanderson of Bowden, L
Mackay of Clashfern, L	Sharples, B.
Margadale, L.	Shaughnessy, L.
Marley, L.	Stodart of Leaston, L.
Maude of Stratford-upon-Avon, L.	Strange, B.
	Strathclyde, L.
Merrivale, L.	Sudeley, L.
Mersey, V.	Thomas of Gwydir, L.
Monk Bretton, L.	Torphichen, L.
Monson, L.	Trafford, L.
Monteagle of Brandon, L.	Ullswater, V.
Mottistone, L.	Vaux of Harrowden, L.
Mountevens, L.	Windlesham, L.
Murton of Lindisfarne, L.	Wise, L.
Orkney, E.	Wynford, L.
Orr-Ewing, L.

Resolved in the negative, and amendment disagreed to accordingly.

7.20 p.m.

The Earl of Arran

I hope that Members of the Committee will agree that this is a suitable moment at which to break for dinner. I suggest that we return to the Committee stage of the Bill at 8.20 p.m. I beg to move that the House do now resume.

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

House resumed.

Water Supply (Water Quality) Regulations 1989

Surface Waters (Classification) Regulations 1989

Controlled Waters (Lakes and Ponds) Order 1989

Water and Sewerage (Conservation, Access and Recreation) (Code of Practice) Order 1989

Director General of Water Services' Register (Inspection and Charges) Order 1989

Water Reorganisation (Pensions etc.) (Designated Persons) Order 1989

Trade Effluents (Prescribed Processes and Substances) Regulations 1989

Control of Pollution (Discharges by the National Rivers Authority) Regulations 1989

Control of Pollution (Radioactive Waste) Regulations 1989

Water Supply and Sewerage Services (Customer Service Standards) Regulations 1989

Control of Pollution (Registers) Regulations 1989

Water Reorganisation (Pensions etc.) Regulations 1989

Control of Pollution (Consents for Discharges etc.) (Secretary of State Functions) Regulations 1989

Water Appointment (Monopolies and Mergers Commission) Regulations 1989

Control of Pollution (Revocations) Regulations 1989

7.21 p.m.

Lord McIntosh of Haringey rose to move, That an Humble Address be presented to Her Majesty praying that the regulations and orders be annulled.

The noble Lord said: My Lords, I do not propose to make a long speech about the contents of these regulations, although I can assure your Lordships that if I did so we could readily fill up not only the dinner hour but also the rest of this evening's business.

I prayed against these orders because they so accurately and immediately bore out the fears which I had, and the fears which I expressed in my reasoned amendment on Third Reading of the Water Bill on 27th June. Perhaps noble Lords will recall that in a relatively unusual procedural Motion I moved an amendment to the Motion that the Bill be now read a third time. The amendment proposed the insertion of the following words: but this House regrets that completion of consideration of the Bill in this House is sought in the absence of adequate information in respect of the terms of water and sewerage undertakers; the likely terms of the flotation and the sale of securities; the basis on which prices to consumers will be set; the final terms of the code of practice on environmental and recreational matters; the detailed requirements in respect of the quality of drinking water and river water, and the relevant timetables for compliance".—[Official Report, 27.6.89; col. 586.] We were assured by the Minister that everything which was normally done in privatisation Bills had been done; that the House had been kept as fully informed as possible about the progress of the supplementary documentation which, as I think he agreed with me, is desirable when the House is considering such important legislation; and that everything would be published as soon as possible. That certainly was true.

However, the moment that the Bill received Royal Assent, 15 orders were placed by the Secretary of State covering the very matters to which I referred in my reasoned amendment: the final terms of the code of practice on environmental and recreational matters; the detailed requirements in respect of the quality of drinking water and river water; and the relevant timetables for compliance.

When we were concerned with the terms of appointment of water and sewerage undertakers, the Minister was kind enough to let me have—although it was too late for me to do anything about it; but, I accept, that he let me have them as soon as he could—the final terms of appointment; that is, the model terms of appointment. But, these 15 regulations were all there. They had all been prepared. As soon as Royal Assent was given, they were available for publication and within 24 hours they were on the news-stands on every street in the capital.

Our complaint, and the reason why we are praying that these regulations should be annulled, is that they could have and ought to have been available to us in final draft form as the Bill went through this House. That is the burden of our complaint. There are many matters which are wrong about them, and I know that other noble Lords have comments to make upon them. But our fundamental complaint and the fundamental criticism that we make of the Government is that we ought to have known the contents of these regulations; we could have known their contents; and the proper respect would have been paid to your Lordships' House if these regulations in their final draft form had been available for debate as the Bill passed through its many stages. Otherwise, as I complained then, and as I complain again now, the Bill is in very material aspects a hollow Bill; it provides for regulations but does not tell the House what they will be.

At the time I said that we had achieved certain improvements in the codes of practice. The Minister had been good enough to write to me about the ways in which the codes of practice were to be improved and I believed him when he said that these improvements would be found in the final form. I was right to believe him. He behaved totally honourably, because the improvements which he undertook to make in the codes of practice were made.

I said that I knew, because I had a letter about it, that of the matters in the codes of practice would be better; but, I also said that I did not know whether some matters would be worse. That was also right because some aspects of the codes of practice are substantially worse than we expected, substantially worse than that which the Government ought to be proposing and substantially worse than those outside the House, who have been concerned with such matters and who have been reading the regulations in great detail, feared. Indeed, this has caused them a great deal of worry.

Let me give just a few examples of the ways in which such matters are wrong. The Water Supply (Water Quality) Regulations 1989 provide for a time-scale. The House will note that the time-scale provided for in these regulations is already out-of-date. The European Commission has already demanded that a time-scale be agreed within a period of two months. If that is not done, there will be legal action in the European Courts. That is the demand that has been made by Senor Ripa Di Meana, the European Commissioner for the Environment.

What has happened, not only since the Bill reached the statute book but also since the regulations were laid, is that our amendment on the time-scale for the improvement of drinking water quality is to be enforced—enforced despite the fact that the Government overturned that decision in another place. Therefore our amendment will in fact win through. The time-scale will have to be agreed, otherwise we shall be taken to court by the European Commission.

I turn now to the Water and Sewerage (Conservation, Access and Recreation) (Code of Practice) Order, 1989. I should remind your Lordships that these regulations are only here because the Government accepted an amendment in this House on Report that they should be subject to the negative resolution procedure. But this order has been widely attacked by those who are concerned with these matters on the grounds, fundamentally, that it is not enforceable, and also on the grounds that nature conservation has not been given the necessary precedence to achieve what was desired by noble Lords on all sides of the House as the Bill proceeded on its course. I know that my noble friend Lady Nicol has points to make on this particular order.

As regards the Water Supply and Sewerage Services (Customer Service Standards) Regulations 1989, these are unacceptable because they do not provide any guarantee of compensation for the supply of unwholesome water.

There should be a no-quibble guarantee similar to the kind given, for example, by Marks and Spencer. We have no such thing. If the House had been told that the regulations on customer service standards would not cover tha case of Camelford (which was referred to by noble Lords on a number of occasions during the Bill's passage) it would have been outraged. Amendments would have been moved—I have no doubt they would have been agreed to—in order to secure that the regulations covered the necessary points.

The Control of Pollution (Registers) Regulations: I do not know what the Government's attitude is towards freedom of information, but the control of pollution registers are to be made available in the NRA's regional headquarters and not where people need them, for example, at local council offices, or, as we argued throughout the Bill's passage, on customers' bills. Here again, the regulations are grossly inadequate.

The Surface Waters (Classification) Regulations are interesting because they provide a standard of a maximum concentration of nitrate of 50 mg per litre for surface water which is abstracted for drinking water purposes. That is a tighter condition than the one imposed by EC directive 75/440 and yet the Government have throughout been arguing—the Secretary of State was arguing in another place only within the past few weeks—that the European Commission had it wrong about nitrate, that the maximum acceptable concentration of nitrates were wrong, and that it was scientifically undesirable as well as practically impossible to achieve those standards. Why has that standard now been entered into the classification of surface water regulations when water is abstracted for drinking water quality purposes?

I could have given many more examples of the way in which the regulations are defective. I need do no more than refer to the fact that the Joint Committee on Statutory Instruments has examined three of the regulations in detail and has found the drafting of them all to be unsatisfactory. The joint committee was asked to deal with all 15 regulations in a period of five days. It was unable to do so. It would be humanly impossible to do so; but it found serious drafting problems with all the regulations. They were not merely produced too late for the House to consider them properly when the legislation was going through, they were badly produced. Heaven knows what defects there are in the other regulations!

In the manner and timing of the presentation of the regulations to Parliament and in the way in which the House has been treated in relation to considering them as part of the proper consideration of the legislation, the Government have failed on all counts.

The regulations should be annulled so that the Government have an opportunity to think again and to correct not just the drafting errors but, much more importantly, the substantive faults in 1he regulations. I hope that the Government will take the opportunity to do so. I beg to move the Motions en bloc.

Moved, That an humble Address be presented to Her Majesty praying that the Water Supply (Water Quality) Regulations 1989 [S.I. 1989 No. 1147] be annulled; an humble Address be presented to Her Majesty praying that the Surface Waters (Classification) Regulations 1989 [S.I. 1989 No. 1148] be annulled; an humble Address be presented to Her Majesty praying that the Controlled Waters (Lakes and Ponds) Order 1989 [S.I. 1989 No. 1149] be annulled; an humble Address be presented to Her Majesty praying that the Water and Sewerage (Conservation, Access and Recreation) (Cope of Practice) Order 1989 [S.I. 1989 No. 1152] be annulled; an humble Address be presented to Her Majesty praying that the Director General of Water Services' Register (Inspection and Charges) Order 1989 [S.I. 1989 No. 1154] be annulled; an humble Address be presented to Her Majesty praying that the Water Reorganisation (Pensions etc.) (Designated Persons) Order 1989 [S.I. 1989 No. 1155] be annulled; an humble Address be presented to Her Majesty praying that the Trade Effluents (Prescribed Processes and Substances) Regulations 1989 [S.I. 1989 No. 1156] be annulled; an humble Address be presented to Her Majesty praying that the Control of Pollution (Discharges by the National Rivers Authority) Regulations 1989 [S.I. 1989 No. 1157] be annulled; an humble Address be presented to Her Majesty praying that the Control of Pollution (Radioactive Waste) Regulations 1989 [S.I. 1989 No. 1158] be annulled; an humble Address be presented to Her Majesty praying that the Water Supply and Sewerage Services (Customer Service Standards) Regulations 1989 [S.I. 1989 No. 1159] be annulled; an humble Address be presented to Her Majesty praying that the Control of Pollution (Registers) Regulations 1989 [S.I. 1989 No. 1160] be annulled; an humble Address be presented to Her Majesty praying that the Water Reorganisation (Pensions etc.) Regulations 1989 [S.I. 1989 No. 1161] be annulled; an humble Address be presented to Her Majesty praying that the Control of Pollution (Consents for Discharges etc.) (Secretary of State Functions) Regulations 1989 [S.I. 1989 No. 1151] be annulled; an humble Address be presented to Her Majesty praying that the Water Appointment (Monopolies and Mergers Commission) Regulations 1989 [S.I. 1989 No. 1162] be annulled; and that an humble Address be presented to Her Majesty praying that the Control of Pollution (Revocations) Regulations 1989 [S.I. 1989 No. 1150] be annulled.—(Lord McIntosh of Haringey.)

Lord Shaughnessy

My Lords, as a Member of the Joint Committee on Statutory Instruments, I should like to endorse the remarks of the noble Lord, Lord McIntosh of Haringey, both in the substance and in the particulars. It is extraordinary that with legislation of this magnitude and importance, the regulations have been found by our committee to be defective in at least three instances. I should like to hear the Minister's comments on why they have had this rather slipshod treatment from the point of view of drafting and other points of view. Why were they not more carefully addressed in relation to a Bill which has attracted as much attention and controversy as the Water Bill has? Perhaps the Minister will address that point when he comes to reply.

Lord Addington

My Lords, I can only endorse what has been said by the noble Lords, Lord McIntosh of Haringey and Lord Shaughnessy, about the regulations and the report which I have looked through and which stated that they were not very good. I found the fact that they came out a little too late extremely irritating to say the least.

Certain issues crop up in respect of the regulations and the code of practice. When it comes to conservation we have more of the old argument on "may" or "shall" cropping up. For instance, page 17 of the code states: In particular, where an SSSI is sustaining damage as a consequence of nutrient enrichment, to which sewage disposal is making a significant contribution, the relevant body should consider suitable remedial action". Surely "should take" or "will take" would be more appropriate. If damage is being done, something should be done about it.

When it comes to matters such as access, there are two categories of access—either by right of way or by a local government Act—as opposed to rights which are granted by the new water companies. There should surely be some way of ironing out that problem.

On recreation, there is the possibility of conflict between angling and boating interests. Once again, something should be done to ensure that if such conflicts arise something is done about them. We can go on to deal with things such as water quality. There is a structure whereby the control of pollution, for instance, will be relaxed if the ground quality is causing any deterioration in water quality.

We should look at what is causing the deterioration in ground quality. If man-made pollution of the ground is affecting the water, something should be done about it. The regulations should cover that point.

I agree that the Government have made a notable step forward in recognising the problem caused by pesticides. I wish that more such steps had been taken. On registration, we have a solution that is good as far as it goes. We shall be told what is put into water. We are told the state of the water before the additives are used or its state afterwards. We should be given more than merely half the information.

We then have the classification regulations. The regulations are an improvement in that somewhat tighter standards are being imposed by the Minister than the directive requires, and I thank him for them. However, when it comes to the three classifications—DW1, 2 and 3—will the Minister tell me whether, where water is being taken for drinking water, there are any water undertakers which do not have plant necessary to bring the water up to the desired quality. Also, it is rather a pity that only drinking water is covered by the directives. Surely, there should be some classification for quality when it comes to fisheries, bathing waters and shellfish. There should be a directive covering those. When we start to deal with the problems we shall not have to consider the water quality for the simple reason that the water will already be of a sufficiently high standard to make bringing it up to standard far easier.

Just as a start, the regulations on water source protection zones require the implementation of protection zones. These regulations are quite a good step towards the desirable state of affairs of better water quality. However, they are only a start. Much more is needed and, as has already been stated, unfortunately they are not very well drafted. I hope that these regulations are a start on something that will come and that where there are flaws—as there will be—the Minister, in his usual gracious manner, will be prepared to make changes to them.

Baroness White

My Lords, I have no intention at all of speaking on any of the details of the regulations. I simply wish to indicate my very strong support for my noble friend Lord McIntosh of Haringey and the representative of the Liberal parties, I suppose I should say, since there is only one representative on the Benches. I also wish to say how glad I am that the noble Lord, Lord Shaughnessy, has taken the trouble to come here and tell the House what your Lordships' Joint Committee on Statutory Instruments feels about the way in which these regulations have been dealt with.

It appears to me that this is not an occasion on which we can satisfactorily discuss any of the details. However, it is possibly the most gross example that we have ever had of the way in which the present Administration has been treating the House in its handling of legislation. It is disrespectful to the House as a legislative Chamber for a group of proposed regulations to be presented to us in this way, without an adequate examination by our own statutory committee which is set up to undertake precisely that task. It is only right that one should make it quite clear that this is not the way in which responsible legislation should be carried out in the House.

I hope that the feelings of those of us who are present can at any rate be conveyed by the Government Front Bench. In our view, this is not the way in which responsible legislation should be dealt with. It is an insult to us and we cannot possibly be expected to deal with the details. They have not been adequately examined by the statutory committee.

Perhaps I may raise one other little matter which interests me from the constitutional point of view. I do not expect the noble Earl to respond because it is not really his function to do so. Perhaps he will ask his noble friend the Leader of the House to inform us what is the shortest period which is accepted as satisfactory between the acceptance by the House of the Motion that the Bill do now pass and the Royal Assent. In this case it was something like one hour 10 minutes. I may be wrong, but it was something of that order.

One may say that this is a constitutional charade, but it seems to me to be rather disrespectful to Her Majesty. One does not imagine her sitting at her desk with her biro at the ready in order to indicate her assent to something passed by this House. I would find it of interest if perhaps the noble Lord, Lord Boyd-Carpenter, who regards himself, I know, as a great authority on these matters could help us. Perhaps he will be able to enlighten us. What is the shortest period that should elapse before the Royal Assent is pronounced on a Bill which has been pushed through the House as this one has?

7.45 p.m.

Baroness Nicol

My Lords, I share the disquiet which has already been expressed by a number of noble Lords. I wish to return particularly to the regulation which covers the conservation, access and recreation code of practice. Perhaps I may remind your Lordships that we were given a draft code of practice in January this year. Many of us based our contributions to the Water Bill on the provisions of that draft code of practice. We had every expectation that the majority of the promises at any rate would be fulfilled.

Now we have the actual code. Perhaps I may remind your Lordships of one paragraph in it which will be found on page 7, under the heading: Integrated Land Use and Management Plans". This very important paragraph says: The objective should be to resolve most conflicts between different land uses by zoning for those uses by area and over time. In cases where conflicts between recreation and the conservation of landscape, flora and fauna cannot be resolved by zoning, preference should normally be given to conservation, especially where this involves securing the protection of vulnerable and endangered species of flora and fauna. That is clear enough. That kind of general expectation ran through the entire draft code of practice. So I was rather disappointed to go through the actual code and find not a mention of zoning and no mention at all of the general approach to conservation and the general feeling that conservation should not dictate any sort of precedence in any circumstances other than sites of special scientific interest and other specially designated areas. What the new code does is to echo the removal of the general approach to conservation which we tried so hard to save.

I have not gone through all 15 of the regulations but I think that as concerns those which I have examined my noble friend on the Front Bench is absolutely right to feel unease at the way they have been handled. I hope that it is not too late for the Government to think again. If they are not prepared to think again, I hope that my noble friend will feel that he can press the rejection of all these regulations.

7.47 p.m.

The Minister of State, Department of the Environment (The Earl of Caithness)

My Lords, I am grateful to all your Lordships who have taken part in this short debate on the instruments before us. The debate is concerned with 15 statutory instruments covering a number of matters relevant to the implementation of the regulatory framework for the privatised water industry which the noble Lord, Lord McIntosh of Haringey, has asked the House to pray against this evening.

I have to say that I thought this was an extraordinary proposal by the noble Lord, Lord McIntosh. I know that he has ritually, throughout the passage of the Water Act, expressed his discontent with the degree of information that we have made available to the House on various matters. That in itself was surprising, as I explained at some length, but it is perhaps even more surprising that his response to the Government's prompt publication of many of the detailed proposals he has been pressing us for is a Motion for their rejection.

Yes, the Government have moved swiftly. The noble Lord, Lord McIntosh of Haringey, and the noble Baroness, Lady White, said that the regulations were laid immediately after Royal Assent. This should come as no surprise to the House. If your Lordships will refer to the points which I made on 27th June on the reasoned amendment moved by the noble Lord, Lord McIntosh of Haringey, in col. 592 of Hansard your Lordships will see what I said at the bottom: The regulations themselves will be laid immediately after the Water Bill receives the Royal Assent and will be based on the consultation documents". So the Government have moved swiftly to produce these measures, a number of which are key elements of our plans to provide a new protection for the water environment. I understand why the noble Lord might not wish to draw attention to the lamentable record of his own party when it was in government in implementing water pollution control legislation. I know he would prefer to forget that it was the government of his party who, having passed the Control of Pollution Act in 1974, failed ever to implement its main water provisions. Nevertheless, it is disappointing to hear only a reprise of the unconvincing arguments we heard during our earlier debates on the Water Act itself.

I put it to your Lordships that the noble Lord has made no case for praying against these instruments. In making these instruments, the Government have fulfilled their undertakings to bring forward key subordinate legislation under the Water Act promptly. The drinking water quality regulations are perhaps the most significant of all the measures we are debating this evening. They incorporate the EC drinking water directive into domestic legislation for the first time, and in a number of respects go beyond its requirements. They provide for all water supplies to comply with EC standards, and set 14 additional national standards. For example, the lead standard is tighter than the one set in the EC directive. Why is that? It is of course in recognition of the need to continue to reduce exposure to lead from whatever source.

The regulations provide for frequent monitoring and analysis, and lay down minimum sampling frequencies much higher than the EC directive requires. They require sampling normally to be done at the consumer's tap and set down procedures for the collection and analysis of samples. There will be independent quality control checks of laboratories, and, in addition, the new drinking water inspectorate will monitor the work done by the water undertakers.

There will be new provisions on water treatment. Supplies will have to meet certain minimum treatment requirements. For example, the use of new chemicals or products in treatment or mains relining will not be permitted without the Secretary of State's approval. Thus, denitrification processes currently being investigated by my department will be able to be used in the programme of reducing nitrate levels only if we are satisfied that they are safe. That was a point to which the noble Lord, Lord McIntosh, alluded when he was talking about what had happened on the reasoned opinion, and the points made by the Environmental Commissioner in Brussels. Of course we seek to mitigate the potential damage from nitrates in order to agree the limits as set out in the directive. We shall be able to do that in most cases except for two—one area in Norfolk and one in Stafford. The reason for that is that we have to introduce new complicated denitrification plants, and we need those to be tested.

I hope that I shall be allowed to ask the noble Lord, Lord McIntosh, a question. The question arises from the debate on these instruments in another place. It was a question that my honourable friend the Minister responsible for water asked the honourable friend of the noble Lord, the honourable Member for Dewsbury. The question was this. If we cannot meet the timetable for the nitrates by 1993, was the party of the noble Lord challenging the basis on which we have yet to test the technology? Surely the noble Lord would not wish us to introduce a denitrification plant in order to meet the directive when it had not been properly tested? Perhaps the noble Lord will comment on that when he replies.

For the first time the drinking water regulations place a duty on water undertakers to provide the public with comprehensive information about the quality of their water supplies. From next January information on compliance, any relaxations, and about undertakings given under Section 20(5)(b) of the Act will be kept in a publicly available record. Water undertakers will also be required to send additional information to local authorities at regular intervals. Both the local authority and the local health authority would have to be told immediately of any significant health risk due to water quality. In summary, these regulations provide for the maintenance and improvement of our already high standards of water quality. In the Government's view they should be generally welcomed.

The regulations on surface water classification and the associated order relating to ponds and reservoirs provide a critical link between the quality of water in the environment and in supply. They make a preliminary use of the powers to introduce systems for water quality classifications, to put in place immediately a system for the classifications in respect of abstraction for human consumption, so that the level of treatment required for different qualities of water entering the supply system may be determined. These instruments allow us to give effect to the EC Surface Water Abstraction Directive, to charge the NRA with the responsibility for monitoring for compliance, and enable us to ensure that all abstractive waters are properly classified and regulated. They are a necessary supplement to the water quality regulations, and should be applauded as a major step towards better water standards.

The noble Lord, Lord Addington, asked whether water would be abstracted from water supply in the DW1, DW2 and DW3 qualities without the relevant treatment capability. The short answer to that is "No". The purpose of the classification regulations, taken with the water quality regulations, is to prevent that happening.

I would have expected the noble Lord, Lord McIntosh, to support the control of pollution measures. These instruments will put in place from the transfer date the requirements for regulating effluent discharges which are fundamental to the pollution control system. They ensure more openness and better accountability, for example by requiring additional information to be published and by removing anomalies in the present provisions. They provide for the separation of the regulator and the regulated so that a water or sewerage undertaker can no longer be accused of being both poacher and gamekeeper in matters relating to pollution control.

The noble Lord asked that the pollution registers' information should be available locally. I have to say that in our opinion that would be quite impracticable. On any reasonable grounds it is surely sufficient that they should be available, as they are now, at 10 regional centres. That provides reasonable access at reasonable cost.

When the noble Lord, Lord Addington, was talking about fisheries, he asked about the matter of river quality and what matters are to be regulated. I repeat the Government's view that it would be unreasonable and inappropriate to establish the relevant classifications and river quality objectives before the NRA is able to give advice and consult on them. The regulations we are debating this evening put in place the framework necessary for the maintenance and development of existing systems.

I shall now turn briefly to some of the other measures which the noble Lord wishes the House to pray against. The customer standards regulations, otherwise known as the guaranteed standards scheme, will enable the domestic customer to claim a £5 cash payment or credit for each occasion or day that certain standards are not met. I am sure that the early implementation of this scheme will be generally well received.

The two measures relating to pensions will ensure that pensions payable at the transfer date in respect of former employees of seven predecessor organisations will be treated in the same way as pensions payable in respect of former employees of the water authorities; and that certain unfunded liabilities of the water authorities will transfer to the National Rivers Authority.

The order relating to the inspection of the director general's register, which includes particulars relating to the appointments of water and sewerage undertakers, specifies the times at which the register is to be open for inspection and the fee payable for certified copies of extracts from it or documents referred to in it. It follows the precedents of previous privatisations.

I now turn to the regulations concerning the procedures of the Monopolies and Mergers Commission for references for determination of questions relating to the appointment of water and sewerage undertakers. These apply standard provisions, and would come into play only if determinations by the director general concerning the level of charges were disputed by appointed companies.

Before I come to the code of practice on conservation, access and recreation, which is of great interest to many of your Lordships, as has been made abundantly clear tonight, I should respond to the noble Lord's comments on the report of the Joint Committee on Statutory Instruments which was published on 19th July. I can assure the House that the Government consider the committee's comments to be valuable and constructive.

I can assure the noble Lord, Lord Shaughnessy, that we shall reflect on what the joint committee has said; in most cases we have already indicated that we will bring forward amending regulations to just three of the 15 instruments. I can only apologise to the noble Lord and to his committee that mistakes were made. They were not intentional, and we tried extremely hard not to make mistakes. However, I apologise for the extra work that I caused the noble Lord.

I now come to the code. This is an important part of the environmental package in the Water Act. I hope that noble Lords on all sides of the House will agree that as a result of the changes made in the light of consultation, and as a result of comments made by a number of noble Lords this document is now even better than the draft we published earlier in the year.

I take the point of the noble Baroness, Lady Nicol, who by and large does not agree with that. I shall read very carefully what she has said and draw her comments in particular to the attention of my right honourable friend.

The code provides the best available guidance on matters relating to conservation, public access and recreation. The negative resolution procedure for its approval, which was included in response to amendments proposed by this House, means that we now have a full and robust statement of the matters to which the NRA and the new water and sewerage companies will have to have regard in performing their general environmental duties.

In conclusion, the laying of these statutory instruments emphasises the Government's determination to act as quickly as possible to maintain and improve the quality of our water environment. They are a first and important step in implementing the new regulatory regime for the privatised water industry from which we shall all benefit. While I am pleased to have the opportunity to debate them, I do not think that there can be any real doubt about the contribution they will make to improving standards in the water industry. On that basis I ask the House to reject the Prayers of the noble Lord, Lord McIntosh, for their annulment.

8 p.m.

Lord Shaughnessy

My Lords, before the noble Earl sits down, perhaps I may say that I am grateful to him for his remarks about any inconvenience that may have been caused to the Joint Committee on Statutory Instruments. No great inconvenience or extra work has been caused to me. The point I tried to make was that speeding through regulations of this order with these consequences resulted in anomalies which, as has been mentioned, are reported in the 26th Report of the Joint Committee on Statutory Instruments in respect of Statutory Instruments Nos. 1147, 1159 and 1161.

Our job is to deal with such anomalies, instances of defective drafting, possible doubt as to vires and the necessity for elucidation. I wanted to impress upon the noble Earl the importance of getting right before they are brought back to your Lordships' House for discussion at whatever time might be indicated on the Order Paper matters of such importance that have such far-reaching consequences.

The Earl of Caithness

My Lords, I listened with great care to what the noble Lord said. I can only apologise again; I shall certainly draw his remarks to the attention of my right honourable friend.

Lord McIntosh of Haringey

My Lords, the Minister has been in his job for 18 months now. I have faced him across the Dispatch Boxes for all of that time. He is by no means as naive as he would like the House to think him, either in terms of the procedures of the House or in terms of political debate.

On the procedures of the House he seeks to persuade your Lordships that my Prayer to annul the instruments reflects a general dissatisfaction with all of the conditions of the statutory instruments. That, of course, is not the case. Under the negative resolution procedure, as he knows very well, the only way in which these statutory instruments can be debated is by a Prayer to annul them. That is the basis on which I proceeded.

The noble Earl knows equally well that it is an established procedure of this House, whether laid down in Standing Orders or not, that we do not seek to divide on a Motion to annul orders that have already been approved by another place. We should not dream of doing so. If another place has already considered the statutory instruments as it has, and has decided to approve them, we should consider it a gross excess of the powers of this House if it were to seek to go against another place.

The Minister knows also that the negative resolution procedure, like the affirmative resolution procedure, makes it impossible to do anything but accept or reject in toto. There is no possibility for us to produce amendments. The fact that we have made criticisms—virtually none of which has been answered—does not imply that we disagree with very large parts of the regulations. The idea that the noble Earl should seek to persuade the House that we object to many of the good things in the statutory instruments is a travesty of the truth. I am sorry that the Minister should have felt impelled to speak as he did.

I am also sorry that his political argument was so weak that he felt it necessary to refer again—I think for the seventh time during the passage of this Bill—to the record of the Labour Government in 1974 to 1979 on investment in sewerage. As before, he sought to use the fact that investment went down between 1974 and 1979 under a Labour Government to convey the totally false impression that the record of investment by a Labour Government was worse than the record of a Conservative Government. If one takes the average investment by a Conservative Government as compared with a Labour Government the average was higher under a Labour Government. That is despite the fact that the Labour Government came into office in 1974 after the oil crisis and a period of severe economic unrest throughout the developed world.

The Minister has sought—let us hope for the last time—to allow the House to draw false implications from a statement he has tried to make on the record of the Labour Government on water and sewerage investment.

The Earl of Caithness

My Lords, I am grateful to the noble Lord for giving way and for reminding me of the Labour Government's record. I did not mention investment. I said that the Labour Party did not implement many parts of the Control of Pollution Act which related to water.

Lord McIntosh of Haringey

My Lords, it was equally inexcusable, whatever he referred to. It was inexcusable to drag up history of more than 10 years ago to bolster a very weak case. If the case had not been weak he would not have thought to intervene in the way that he did.

What is significant about the debate is not so much procedure. It is the fact that the Minister has not been able to defend the very specific criticisms that have been made on the form of the instruments by the noble Lord, Lord Shaughnessy, and on their content by my noble friends Lady White and Lady Nicol. He has not given adequate answers to those questions.

The Minister sought to revive a particularly fruitless debate in another place in which his colleague, the Minister for Water, challenged my honourable friend Mrs. Ann Taylor on nitrates. I can only say that he cannot have read Hansard very thoroughly. Mrs. Taylor gave a very clear response to the Minister. Her response applied specifically to the complaint that had been made by Mr. William Cash that in his part of the country geological faults made it impossible to achieve the full nitrate standards required by the European Commission. Mrs. Taylor said in reply that undoubtedly, where there are geological reasons, as there are in Staffordshire derogations can be negotiated with the European Commission. That was a full and complete reply to the questions raised by Mr. Michael Howard.

It is pity that the Minister thought fit to reply to the serious criticisms that have been made of the form and content of the regulations in the way that he did. It is not worthy of him or of the House. If it were not for my profound respect for the relationship of this House with another place I should be sorely tempted to divide the House on the humble Address that the regulations be annulled. I do not think that we have been given an adequate reply. I do not think that we have been treated with the seriousness which the House deserves, either during the passage of the Bill or during this final stage of the laying of regulations. However, in accordance with precedent, I beg leave to withdraw my Motions.

Motions, by leave, withdrawn.

Viscount Long

My Lords, I beg to move that the House do now adjourn during pleasure until 8.20 p.m.

Moved accordingly, and, on Question Motion agreed to.

[The Sitting was suspended from 8.10 to 8.20 p.m.]