Lords Sitting of 15 May 1990

Preamble
The House met at half-past two of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Chester.

Baroness Eccles of Moulton
The Hon. Mrs Diana Catherine Eccles, having been created Baroness Eccles of Moulton, of Moulton in the County of North Yorkshire, for life—Was, in her robes introduced between the Baroness Elliot of Harwood and the Lord Prior.

Lord Richard
Ivor Seward Richard, QC, having been created Baron Richard, of Ammanford in the County of Dyfed, for life—Was, in his robes, introduced between the Lord Ponsonby of Shulbrede and the Baroness Ewart-Biggs.
Lord Rugby Lord Rugby— Sat first in Parliament after the death of his father.

Scotland: Inward Investment
2.50 p.m.
Baroness Carnegy of Lour Baroness Carnegy of Lour asked Her Majesty's Goverrment:
How much inward investment has been made by companies in Scotland since 1985.
The Minister of State, Scottish Office (Lord Sanderson of Bowden): My Lords, figures for the total investment made by inward investing companies since 1985 are not available, but statistics produced by Locate in Scotland show that between April 1985 and March 1990 companies locating in Scotland in these years were planning investment of some £2.6 billion.
Baroness Carnegy of Lour: My Lords, I thank my noble friend for that extremely encouraging reply. The published figures show that despite inflation and high interest rates the economy of Scotland continues to improve in relation to the economy of the UK as a whole. Will my noble friend tell the House whether this is mainly due to the massive increase in investment in oil which is now taking place or whether there are other important reasons for it?
Lord Sanderson of Bowden: Lords, it is certainly true that the recovery from the low point in 1986 in the oil industry has contributed to the figures, but so also have our export industries, particularly whisky and electronics. Those latter two industries have benefited from strong growth in world markets.
Lord Carmichael of Kelvingrove: My Lords, we are all delighted to hear of new inward investment in Scotland. The announcement today concerning Motorola is particularly welcome. However, can the Minister give us any indication of the number of jobs that have been created as opposed to those that have been promised by the Scottish Office and certainly in the newspapers? I understand that over the past five years the number of jobs that have been created has never reached more than 60 per cent. of those that were promised. Will the Minister comment on that?
Lord Sanderson of Bowden: My Lords, it is perfectly true that the difficulty lies in estimating how many jobs will result from any planned arrangements. I can do no better than to say that planned job figures are those indicated by the companies concerned when decisions to proceed with their projects are taken. Evidence over a period of years suggests that an average of around two-thirds of planned jobs are achieved. In answer to the question of the noble Lord, I can say that inward investment planned by companies locating in Scotland has totalled some £3.8 billion since 1981. Those plans are associated with the intended creation of safeguarding of over 70,000 jobs. It is difficult to give the noble Lord exact figures but I can tell him that Compaq is a good example. In 1986 that organisation planned 350 jobs in Erskine. However, in 1991 that figure will rise to 1,100 jobs. Of course it does work the other way in some cases.
Lady Saltoun of Abernethy: My Lords, while the central belt has undoubtedly benefited from all this investment, will the noble Lord indicate how he sees the industrial future of the Highlands and Islands?
Lord Sanderson of Bowden: Yes, my Lords, I can do that, but it is difficult to generalise about the Highlands and Islands. There are, as the noble Lady knows, problems in Caithness in relation to the run-down of Dounreay. In the inner Moray Firth area things are going extremely well, but the rest of the area is in many cases fragile. However, I can tell the House that 2,000 jobs have been created in fish farming. That appears in the 1989 figures and it is a good tale to tell. In various towns in the North of Scotland substantial numbers of jobs have been created. There is the example of Zonal in Invergordon, where 80 jobs were created recently. Further, 110 jobs were created in Inverness as a result of a relocation from Derbyshire.
Lord Mackie of Benshie: My Lords, will the noble Lord expand on his figure of £2.6 billion? It would be useful if he could tell the House approximately how much of that figure is due to native industry—for example, the whisky industry—and how much is due to incoming foreign investment.
Lord Sanderson of Bowden: My Lords, I cannot give the noble Lord an answer to that question. However, I can say that both the SDA and the Highlands and Islands Development Board are looking for investment from whatever source. Since 1985 £700 million of government money has been

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produced by SDA and £147.8 million by the Highlands board. However I shall look at the question and write to the noble Lord with details.
Lord Lyell: My Lords, can my noble friend give the House the latest figures for the Locate in Scotland campaign which has contributed to the success already mentioned by my noble friend? Locate in Scotland has had a considerable impact. Does my noble friend have any recent figures?
Lord Sanderson of Bowden: My Lords, the Locate in Scotland campaign is an ongoing campaign and last year was a record year.
Lord Ezra: My Lords, although there are benefits of a short term nature from inward investment in Scotland, will the noble Lord say to what extent he believes that the large amount of money which has been invested in Scotland from outside will have long-term advantages?
Lord Sanderson of Bowden: My Lords, in answering that question it may be instructive if I tell the noble Lord that the total number of jobs in coal, steel and shipbuilding in Scotland is now 24,000. To put that into context, in 1989–90 Locate in Scotland has 64 projects totalling £853 million which are forcast to provide 12,000 jobs. That gives an indication of the swing that we are trying to achieve in Scotland to new industries and new developments from the old industries.
Baroness Carnegy of Lour: My Lords, training and local access to training for medium and small-sized companies is extremely important. Can my noble friend tell the House how the local enterprise companies are progressing, how many are planned and how many there will be in various parts of Scotland?
Lord Sanderson of Bowden: My Lords, development funding in the Scottish enterprise area has been awarded to 12 prospective local enterprise companies, including Moray which straddles the border between the Highlands and Islands enterprise area and the Scottish enterprise area. Development funding for five prospective LECs has been awarded in the Highlands and Islands enterprise area and bids in respect of a further four are currently being considered.

Civil Servants: Training
3.5 p.m.
Lord Rochester Lord Rochester asked Her Majesty's Government:
Whether they are satisfied with the standard of training of non-industrial civil servants.
The Lord Privy Seal (Lord Belstead): My Lords, in 1988–89 the Civil Service invested £356 million to provide on average over four days training for each civil servant. Overall that compares well with good practice in the private sector. Eighty per cent. of that training is provided directly by departments to meet their particular needs. The high quality of
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the top management programme, which is provided centrally, is indicated by the high demand for places from the private sector. The Civil Service College similarly provides a high standard of training for management and for professional development.
Lord Rochester: My Lords, I thank the noble Lord the Leader of the House for his reply. However, does he accept that the National Audit Office reported recently that the training of white collar civil servants was too often subordinate to more immediate pressures on manpower? Does he also accept that it cited the high level of cancellations in respect of college training courses and referred to the limited role allowed to departmental training officers?
Lord Belstead: My Lords, the Government welcome the report which the noble Lord mentioned and the support which it gives for the work of the Office of the Minister for the Civil Service. The details of that report are under careful consideration and the noble Lord will forgive me if I do not prejudge today the consideration that is being given to the report by the Public Accounts Committee. Having said that, perhaps I may give the noble Lord an assurance that as part of improving service to the public all departments are reviewing their training provision, particularly with a view to improving the areas of management and customer service.
Lord Cledwyn of Penrhos: My Lords, can the noble Lord the Leader of the House go one step further and tell the House, on the one hand, how much is spent on in-service training and, on the other hand, how much is spent on external training? That would be helpful information. Will he be good enough also to tell us the number of non-industrial civil servants who are currently employed?
Lord Belstead: My Lords, there are 500,000 civil servants in post. I must apologise to the noble Lord for not having the figures for in-service and other training. I think I am right in saying that a recent publication of the Office of the Minister for the Civil Service entitled Civil Service Training 1987–88 and 1988–89, only breaks down the type of training in departments into induction, vocational and management. However, if I can find an answer regarding in-service training I shall write to the noble Lord and place a copy of my letter in the Library.
Lord Rochester: My Lords, the Lord Privy Seal in his reply to me said that at this stage I would not expect him to comment in more detail on the report of the National Audit Office. However, will he go a little further and acknowledge that the matters to which I referred are of such significance that they require constant monitoring by the Government quite independently of anything that the National Audit Office may have to say upon them?
Lord Belstead: Yes, my Lords, I shall gladly go just a little further and agree with the noble Lord, Lord Rochester, that he mentioned certain important matters, particularly the targeting of investment and the evaluation of the outcome of training, which the Government take particularly seriously.

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Perhaps I may respond to what the noble Lord said about monitoring. With his interest in and experience of those matters, he will perhaps agree with mo when I say that there are limits to the extent to which a direct relationship can be drawn between training and the overall performance of a business, agency or department which many other independent factors can affect. However, despite that, I hope that the noble Lord will be pleased when I say that the week before last the Office of the Minister for the Civil Service published practical guidance on evaluation. That is designed to help establish how training contributes to performance improvements, both for the individual and for the organisations concerned.
Lord Allen of Abbeydale: My Lords, does the noble Lord think that the Civil Service College has achieved the high hopes which were held for it? It seemed not to do so in its early days. Has it become a centre of research in the way that its founders hoped that it might develop?
Lord Belstead: My Lords, on the question of the achievements of the Civil Service College, published statistics showing high pass rates for professional qualifications achieved there indicate training well above the average. That is to be welcomed. I should like to look into the question of whether it has become: a centre for research in the way envisaged and perhaps contact the noble Lord subsequently.

Homelessness: Grants
3.11 p.m.
Lord Stallard Lord Stallard asked Her Majesty's Government:
What criteria were used to determine the amount of grants to be withheld from those voluntary organisations working and advising on problems of housing and homelessness.
Lord Reay: My Lords, £2 million has been allocated to voluntary bodies concerned with homelessness this year—three times last year's total. Half will go to a new national advice service based on citizens advice bureaux and involving Shelter and SHAC, and half to a total of 26 bodies providing direct assistance and practical help to homeless people. The new arrangements for this year's grants were announced by my right honourable friend, the then Minister for Housing, in November last year. The bodies which received grant last year were warned in writing and in person that there was no guarantee of future funding.
Lord Stallard: My Lords, does the noble Lord accept that his Answer will be disappointing, to say the least, to the 12 organisations which provide special assistance to homeless groups, refugees, home owners, the single homeless, one-parent families and ex-offenders? What criteria were used to cut the Section 73 grants to those people? There has been a cut of £310,000 at a time when homelessness is higher than ever and when experienced counselling
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will be in shorter supply. The two things do not marry up. We have not been told why the cuts were made and what criteria were used to introduce them.
Lord Reay: My Lords, as I said in my original reply, the total amount of money made available has nearly trebled from £680,000 in 1988–90 to £2. million this year. More than 30 bodies will receive grant this year compared with 21 last year. Some bodies have done very much better this year than last year and over £750,000 has gone to 23 new bodies not previously funded.
Funding decisions were difficult. All proposals were carefully and fairly considered against the criteria laid down. The programme was very much over-subscribed and some applicants were bound to be unsuccessful. The criteria were announced on publication of the Government's review of the homelessness legislation. There were to be imaginative and innovative practical projects of positive and direct assistance on the ground to help homeless people find suitable accommodation and to boost the supply of lodgings and also set up registers.
Baroness Faithfull: My Lords, as a trustee of one of the voluntary organisations whose grant has been cut, perhaps I may ask my noble friend whether, despite the figures that he gave, he thinks that it is penny-wise pound-foolish at this time, when homelessness is a growing problem, to have cut the grants to voluntary organisations which work hard and give a good service?
Lord Reay: My Lords, we have not cut the grants to voluntary bodies. We have increased them by more than three times. As I said, some bodies have done considerably better this year. For example, Shelter will receive £454,000 this year; last year it received £120,000. SHAC will receive £400,000 this year; last year it received £200,000.
Lord Murray of Epping Forest: My Lords, is the Minister aware of the emphasis rightly placed by noble Lords in all parts of the House on bringing into the public arena empty property for the use of homeless people? Is he also aware of the notable contribution made to that approach by the Empty Property Unit which on a shoestring budget has helped to make almost 40,000 such properties available on a short-term basis? Is he not concerned that a cut of £27,000—one third of its funding—will severely affect the work of the Empty Property Unit, which is in the front line of that activity? Will he urge his honourable friend the Minister for Housing to receive as a matter of urgency representatives of the Section 73 liasion committee to discuss the content of that decision at a time deep into the financial year when other funds are not available?
Lord Reay: My Lords, the noble Lord has raised a number of questions. With regard to bringing in empty property, over the past 10 years we have spent £300 million in creating 21,000 hostel places. This year and next we shall spend an extra £250 million in London and the South-East to reduce homelessness. That answers the point raised by the noble Lord.

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As I said, there were difficult decisions to take. The Government gave priority to practical, not advisory, projects to help the young and rough sleepers and the single homeless people get back on their feet. The Government take the problem seriously. Unfortunately, we were not able to give grants to all applicants.
Lord Molloy: My Lords, we have seen an ever-increasing amount of homelessness and the growth in our cities of those appalling cardboard sectors in which people live. When do the Government intend to do something to deal with the problem and set about creating a housing programme so that such people can be housed? In the meantime, will they encourage all voluntary organisations which are prepared to give of their best to counter the hopelessness of the homeless in this country?
Lord Reay: My Lords, it is precisely in order to encourage the voluntary bodies concerned with that problem that we have increased so substantially the amounts of money allocated to them this year. The Government are concerned about the problem of those sleeping rough and about homelessness generally. The problems are complex. They relate not only to housing, but to the responsibility of a number of departments. The Government are now considering how those policies work together to ensure that appropriate assistance is available.
Baroness Macleod of Borve: My Lords, is my noble friend aware that many voluntary organsiations do not ask for or receive any government grant. Does that not help those which receive large grants? Is he further aware that those who work for the organisations act out of love and care for people in those unfortunate circumstances?
Lord Reay: My Lords, I am quite sure that my noble friend is entirely right.
Lord Dean of Beswick: My Lords, does the Minister agree that if the noble Baroness, Lady Faithfull, and my noble friend Lord Stallard are correct, resources are drawn away from some small organisations which provide a useful service? It may well be that Shelter and SHAC will be pleased that they have had their grants trebled. Set against the appalling situation of the homeless in this country, in some respects the Minister wants commendation for the fact that the Government have increased the grant to £2 million. Does he not understand that in the overall picture that is a financial pippin? Does the Minister not agree that the Government should be pumping in resources to a much greater degree? What the Government are doing at the moment is quite insufficient to deal with the problem.
Lord Reay: My Lords, the original Question asked by the noble Lord, Lord Stallard, related to funds for voluntary bodies. As I said, those funds have been increased by more than three times over the past year. And it is not only the larger organisations which have benefited. Over £750,000 goes to 23 new bodies. Perhaps I may give three examples. This year
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Centrepoint received £110,000; last year it did not receive anything. Two smaller bodies, Bristol Cyrenians who last year received £10,000 and New to London who received £11,000 will this year receive £40,000 and £70,000 respectively. Therefore, it is not only the larger organisations which will benefit.
Lord Blease: My Lords, can the Minister indicate what the criteria are for financing measures to combat homelessness in rural areas? Attention has rightly been given to the human misery which exists in the inner cities and particularly in London. However, does the Minister not agree that there is a tremendous amount of deprivation, suffering and human misery in the rural areas? Can he indicate what criteria a voluntary body has to meet in order to qualify for a grant to deal with the situation in those areas?
Lord Reay: My Lords, I am unable to say whether there are separate criteria for rural areas. I shall look into the matter and inform the noble Lord.
Lord Stallard: My Lords, in his replies the noble Lord mentioned on a number of occasions that grants were being given to organisations helping young people who are sleeping rough. No organisation has been doing that job better and more consistently than CHAR. We all know of the work that that organisation has carried out. Can the Minister say why the grant to CHAR has been cut by £36,000? Can he further say why all the organisations received application forms for the renewal or increase of their grants in late February which had to be submitted by the beginning of March? The organisations did not know until 26th April that their grants had been cut. I am still puzzled how the organisations were categorised and what were the criteria used.
Lord Reay: My Lords, we recognise the value of the work that CHAR does. Indeed, my honourable friend the Minister for Housing will visit that organisation on Thursday. We had very difficult decisions to take and some difficult choices had to be made. As I said in my original Answer, we gave warning that we could not guarantee funding. The Government must be able to use their discretion in deciding who should receive funds according to the best criteria.

BAe: Rover Takeover
3.23 p.m.
Lord Williams of Elvel Lord Williams of Elvel asked Her Majesty's Government:
What is their most recent information about the attitude of the European Commission to the terms of the acquisition by British Aerospace plc of Rover Group plc.
The Minister of State, Department of Trade and Industry (Lord Trefgarne): My Lords, the European Commission has not concluded its inquiry into the terms of the sale of the Rover Group to British Aerospace and we have not, therefore, had any indication of its views on the matter.
Lord Williams of Elvel: My Lords, I am grateful to the Minister for his Answer so far as it goes. Does he not agree that it is profoundly unsatisfactory that a major British public company may have to return large sums of money to the Government and that there are allegations flying around that Parliament was misled and that there was government subterfuge? Does the Minister further agree that none of these matters can be resolved until the Commission pronounces? Can he confirm that the Government will do everything in their power to hasten that decision and make sure that we can debate these matters in the open light of full knowledge?
Lord Trefgarne: My Lords, the Government have no power over the Commission in this matter. We shall just have to wait in patience.
Lord Boardman: My Lords, does my noble friend expect that the European Commission will share the pleasure of the British taxpayer who sees this company, which for so long lost money in the public sector, now making money in the private sector and also making very good cars?
Lord Trefgarne: My Lords, my noble friend makes a powerful point. It is one that I have ventured to make to your Lordships in the past.
Lord Hatch of Lusby: My Lords, does the noble Lord realise that even before the publication of this long-delayed European Commission report two things were established: first, that the previous Secretary of State misled both Parliament and the Commission; and, secondly, that the Government have been conducting their business by bribery, euphemistically known as "sweeteners", which is hardly in accord with the British tradition of parliamentary democracy?
Lord Trefgarne: My Lords, I think your Lordships may agree if I suggest that the only place where those matters have been established is in the mind of the noble Lord.
Lord Molloy: My Lords, there have been articles in the newspapers.
Noble Lords: Order!
Lord Harmar-Nicholls: My Lords, my noble friend said that we have no authority over the Commission. As distinct from the European Parliament and possibly the Council of Ministers, can he tell me what power the European Commission has under the Treaty of Rome to express an attitude on the internal decisions of any member state?
Lord Trefgarne: My Lords, the Commission is undoubtedly entitled to inquire into this matter under the terms of the Treaty of Rome and to express a view which we understand it will shortly give.
Lord Bruce of Donington: My Lords, will the noble Lord reconsider the answer that he gave to a previous question in which he indicated that there was no
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evidence of any duplicity in this matter? Has the noble Lord read the correspondence from the previous Secretary of State to British Aerospace in which alternative means of misleading Parliament as to the true nature of the purchase consideration are fully and clearly set out? Can the Minister say what the Government intend to do about that?
Lord Trefgarne: My Lords, I repeat to the noble Lord that there has never been any question of seeking to mislead Parliament.
Lord Hailsham of Saint Marylebone: My Lords, would it not be better if we awaited the report which, as my noble friend has said, will shortly be forthcoming before we attempt to establish points?
Lord Trefgarne: My Lords, I certainly agree with my noble and learned friend that it would be much better to wait on the report from the European Commission before commenting on it.
Lord Cledwyn of Penrhos: My Lords, further to the very proper point made by the noble and learned Lord, can the Minister give an assurance to the House that when the report is published a Statement will be made in both Houses?
Lord Trefgarne: My Lords, it is not for me to decide on such matters. However, I shall be very surprised indeed if that did not happen.
Lord Hatch of Lusby: My Lords, the noble Lord has suggested that the assertions I made are only in my mind. I repeat the question asked by my noble friend Lord Bruce of Donington: has the noble Lord read the correspondence which is in the Library and which indicates quite clearly that the previous Secretary of State was offering alternative means of duplicity to British Aerospace when he wrote to it? That correspondence is in the Library and not in my mind. Has the Minister read it?
Lord Trefgarne: My Lords, I suggest to the noble Lord that he takes the advice of my noble and learned friend and awaits publication of the report.

Business
3.29 p.m.
Lord Denham: My Lords, it may be for the convenience of the House to know that the Report Stage of the Law Reform (Miscellaneous Provisions) (Scotland) Bill will be adjourned at about 7.30 p.m. for about one hour, and that during this adjournment the Second Reading of the Computer Misuse Bill will be taken.

Social Security Bill
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Henley): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That it be an instruction to the Committee of the Whole House to whom the Social Security Bill

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has been committed that they consider the Bill in the following order:
Clauses 1 to 7,
Schedule 1,
Clauses 8 to 11,
Schedule 2,
Clause 12,
Schedule 3,
Clauses 13 and 14,
Schedule 4,
Clauses 15 to 17,
Schedule 5,
Clauses 18 to 21,
Schedule 6,
Clauses 22 and 23,
Schedule 7.—(Lord Henley.)
On Question, Motion agreed to.

Law Reform (Miscellaneous Provisions) (Scotland) Bill [H.L.]
3.30 p.m.
Report received.
Clause 1 [Information as to recognised charities]:
Lord Cameron of Lochbroom Lord Cameron of Lochbroom moved Amendment No.1:
Page 2, line 12, at end insert:
("(b) to a designated body, information as regards any recognised body as to its name, address and its purposes so far as known to the Commissioners,").
The noble and learned Lord said: My Lords, in bringing forward the amendment, to which I shall speak with Amendments Nos. 7 and 49, I was encouraged by the comments made in Committee by the noble and learned Lord the Lord Advocate and by support from other noble Lords for the general line which they take.
Their purpose is to place on the face of the Bill provisions for the production of a register or index of charities, whether a general index or one dealing with specific areas. It would be particularly helpful for those who may wish to apply for assistance from such charities. The aim is to secure the openness which was suggested by the Government in their original consultation paper and subsequent White Paper.
I am grateful to the noble and learned Lord the Lord Advocate for arranging a meeting between Scottish Office officials, officials of the Inland Revenue and representatives of the Scottish Council for Voluntary Organisations in order to discuss the matter as referred to in Committee. Undoubtedly, it was a useful meeting but, while helpful, there appeared to be opposition to the inclusion in the Bill of enabling provisions which recognise the principle of the publication of an index covering the whole area of recognised bodies or of a separate indices covering areas such as overseas aid or mental health. They were mentioned in Committee not only by the noble and learned Lord but also by the noble Baroness, Lady Carnegy.
I remind the House that a register is already in existence in England and Wales. It is kept by the
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Charity Commissioners and derives from the statutory powers given to them under parliamentary legislation. It has proved to be of assistance to potential applicants, prospective donors to charities and to the general public. As regards our jurisdiction, it may be a means whereby members of the public can obtain reports from specific charities and thus obtain more specific information. That is the intention of the provisions in the Bill which make specific requirements for the production of reports by charities.
I suggest that under the new regime which the Bill introduces for Scotland there should be a register similar to that in England. The present offer of information, which was made at the meeting by officials of the Inland Revenue to representatives of the Scottish Council for Voluntary Organisations, would relate only to one point in time. Therefore, any publication based upon that information might quickly become out of date. That is particularly so if the estimate of some 400 new bodies recognised annually by the Inland Revenue in Scotland is accurate.
I remind the House that charities may come and equally they may go. Clauses 8 and 9 of the Bill provide for that. Their purposes may change and those clauses also provide for that. The provision in Clause 9, secured by Amendment No. 37, will mean that the reorganised charities will be required by the Inland Revenue to become recognised bodies.
I suggest that there should be a continuance of the flow of information from the Inland Revenue in order to allow the production of new indices from time to time or the updating of the old. That will require, first, that the Inland Revenue is free of any duty of confidentiality as regards providing information where an index or register is sought to be set up. Secondly, it will require some restriction to be placed on those who go to the Inland Revenue to seek such information.
Amendment No. 1 is the key to the unlocking of the information, to take up a metaphor used by the noble Earl, Lord Perth, in Committee. It provides for the loosing of the duty of confidentiality. Amendment No. 7 ensures that the key is handed out by the Secretary of State only if he believes it proper to do so. Amendment No. 49 is consequential. They are enabling provisions and no more. I suggest that they need to be on the face of the Bill in order to make certain that the requirement for a register or index is fully understood and that it is available while the regime continues. I hope that the Government will feel able at least to accept the spirit of the amendments. I beg to move.
Lord Morton of Shuna: My Lords, I support the amendment which also stands in my name. Without the provision on the face of the Bill for an up-to-date index people will be unable to discover existing charities that may help them or existing charities to which they may give. It would be unfortunate if we allowed the Bill to pass without making provision for such a list.
Lord Macaulay of Bragar: My Lords, I add my voice on the subject to those of the noble and learned

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Lords, Lord Cameron and Lord Morton. The matter was fully canvassed in Committee and boils down to the fact that there should be a system whereby the public can have confidence in the running of charities. People should be able to go to a source which may confirm their views on the existence and nature of the charity or which may be able to supply different information. It would also enable a reasonable check to be kept on those who run charities. As we all know, some people purport to run charities but the only charities which benefit are themselves. As regards inducing public confidence in charities I hope that the noble and learned Lord the Lord Advocate will consider the spirit of the amendment.
Baroness Carnegy of Lour: My Lords, since the Committee stage I have discussed the matter with one or two bodies which are interested in having access to such a list of charities and also with some individuals. There is a need for the list which my noble and learned friend indicated would be desirable. It should be broken down to show the types of charities which exist in order to help users of the list to find the information that they need. However, that will not be possible unless the Inland Revenue is able to release the complete list and keep it up to date.
Under the amendments the list would be protected and not widely available. However, the subsequent breaking down would make it available. Therefore, I hope that my noble and learned friend will find a way of providing a list and will take note of the fact that it must be kept up to date. It will be no good if the Inland Revenue releases the details once, but does not do so again. I hope that he can help the House although I realise that he is faced with a problem.
The Lord Advocate (Lord Fraser of Carmyllie): My Lords, the purpose behind the amendment is not to ensure that there is proper regulation of charities, as indicated by the noble Lord, Lord Macaulay, but rather to provide a more positive purpose: that those who wish to obtain grants from charities might discover which they may approach. Alternatively, someone working in a particular field may discover that there is a comparable body.
As I indicated in Committee when similar amendments were moved, the Government have some sympathy with the suggestion that a directory of charities would be useful. However, I stress again that to do as the noble and learned Lords have suggested and require the Inland Revenue to release to a designated body, in addition to the names and addresses of registered bodies, a summary of their principal objects, would not only be a major undertaking for the Revenue in Scotland; the effort would not be worthwhile. The effort would not be worthwhile because the majority of the purposes which are submitted to them are expressed in such broad and general terms as to be of restrictive value to anyone who may wish to know of the charities. Frequently such deeds list two or three broad heads of charity to preserve maximum flexibility for the
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trustees. In most instances the name of the charity is likely to be more informative than the objects.
As I made clear during Committee, I do not believe it is a necessary function of government to maintain an index showing charitable purposes nor, for reasons I have indicated, to designate a particular body to undertake this task.
I informed your Lordships that I had asked Scottish Office officials to arrange a further meeting with the Inland Revenue and the Scottish Council for Voluntary Organisations. I am pleased to confirm that such a meeting has taken place.
As part of the publicity to precede the commencement of these provisions the Inland Revenue will issue letters to all known recognised bodies notifying them of their unique number and summarising the new arrangements for supervision. We will afford the Scottish Council for Voluntary Organisations, on a "one off basis, the opportunity of enclosing with this letter a questionnaire for completion by each charity. Completion of the questionnaire would of course be voluntary and it would be returned direct to the Scottish Council for Voluntary Organisations. The information which the questionnaire might seek could include a summary of the charity's purposes, activities or areas of interest. This should enable the Scottish Council for Voluntary Organisations if it so wishes to put in hand the preparation of an index of purposes. I understand that the Scottish Council for Voluntary Organisations has already expressed considerable interest in such a proposal.
Updating any directory will be a matter for the SCVO. It will of course enjoy the statutory access to annual reports and accounts. It will be at liberty to invite trustees to compile a directory entry in whatever format seems most useful, and to update the information and revise the format at whatever interval it judges appropriate. It will easily be able to identify newly-recognised bodies—which I believe was the point about which my noble and learned friend was particularly anxious—because the Inland Revenue will maintain, on an ongoing basis, a list of recent additions to supplement the last revision of the fiche index. I stress in view of the points made by my noble and learned friend that the Inland Revenue is prepared to provide periodically a means of identifying new recognitions to the SCVO. Therefore, it is not, as I accept appeared to be the position in Committee, that the Inland Revenue will provide that once and for all with no question of an update.
In approving new charities the Revenue seeks to ensure that the constitutional document of the body provides that there should be a charitable destination for any funds in the event that the body winds up. The Revenue will note the index whenever it comes to its notice that a charity has wound up. Though the Revenue will not necessarily know if a body ceases to function, this should become apparent on any occasion that the SCVO chooses to consult charities in order to update any directory it may have prepared.
In the case of amalgamations or the transfer of resources to another body, there is a requirement in

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Clause 9 of the Bill to ensure that the purposes of the new trust will qualify for tax exemption. The Revenue will, of course, note the index to the effect that the former charities have wound up and amalgamated to form a new named body.
While the Government understand what lies behind these amendments, they take the view that there is no need for them. Their purpose will be achieved by the administrative action which I have described. It will not be a once and for all index by the Inland Revenue but it will be updated. Any body such as the SCVO taking up the task of providing a directory will be able to secure the necessary information. As I have indicated, that seems to me to be a better way forward because the information most useful to those who wish to have access to charities will not be available from the Inland Revenue but from the charities themselves.
I hope that what I have outlined is considered to be constructive and appropriate. In view of that I hope that the noble Lord feels able to withdraw his amendment.
3.45 p.m.
Lord Cameron of Lochbroom: My Lords, I am grateful to the noble and learned Lord for the positive way in which he has replied. I have reservations as to whether this can be done by the promise of administrative action in a regime intended to be statutory and intended to continue to be in force even if for example, the Scottish Council for Voluntary Organisations is no longer in existence.
I add that the first amendment was carefully drafted conscious of the fact that the Inland Revenue might not know the purposes, and a qualification to that effect appears at the end. However, in view of what the noble and learned Lord has said, which I shall read, I do not intend to press this matter and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 2:
Page 2, line 24, leave out from ("its") to end of line 26 and insert ("explanatory document")
The noble and learned Lord said: My Lords, I shall speak also to Amendments Nos. 3 and 8. Clause 1 (3) requires a recognised body to provide to any person who requests it on payment of a reasonable charge, a copy of its trust deed or other document constituting the body. Subsection (4) enables me to instruct the Inland Revenue to note where any body has failed, on payment of a reasonable charge, to provide such a document.
Whereas most bodies should have no difficulty in complying with this request certain bodies—notably some of the long-established Churches—would be unable to provide any single document which would enable a person to ascertain the nature of the body and its charitable purposes. This amendment will permit such bodies to prepare with my approval a document which describes the bodies' charitable objects.
The amendment will meet part of the concerns expressed by such bodies as the Church of Scotland and the Scottish Churches Committee. Your Lordships will wish to know that a further meeting has taken place between officials of the Scottish Home and Health Department and the Scottish Churches Committee to discuss the possibility of more wide-ranging amendments to the Bill which would have regard to the concerns expressed by various noble Lords in Committee about the undesirability of powers enabling me to become involved when mismanagement occurs among religious bodies.
A number of points have been put to the Scottish Churches Committee which, as I understand it, are being considered urgently without, as yet, any clear indication as to whether all the points are acceptable to them in that form. Perhaps I may indicate to noble Lords that in that regard the Government intend to bring forward amendments in Committee in another place, particularly relating to the Churches in Scotland. I beg to move.
Lord Morton of Shuna: My Lords, the amendment is helpful as far as it goes. I merely raise a doubt about the wording of Amendment No. 8. My impression is that a fairly large proportion of charities would rather produce an explanatory document than the trust deed or other document constituting the body. Many of the 15,000 or more charities will produce a document which describes the nature of the body and its charitable purposes. Does the noble and learned Lord the Lord Advocate really wish to study over 10,000 documents to see that they fit the trust purposes? Would it not be better for him to have the right to veto any such documents which came to his attention which were inaccurate and to leave it to the body to define its own trust purposes?
As the noble and learned Lord mentioned the Churches, I should have thought that he would find it invidious specifically to approve any religious body's explanatory document in that way, whereas he might be happier with a power to disapprove a document which he thought did not fully and properly meet the case. The noble and learned Lord the Lord Advocate has taken on a very heavy job for which, according to the Bill's original descriptive documents, he will have a staff of eight. I doubt whether that will be possible.
Lord Fraser of Carmyllie: My Lords, I do not wish to be involved in the redrafting of the articles of faith of any religious body. I understand what the noble and learned Lord is saying. I do not envisage that there will be any particular difficulty in that regard. If I have to consider a large number of documents, clearly more lax arrangements will need to be put in place than had been envisaged.
Lord Macaulay of Bragar: My Lords, before the noble and learned Lord the Lord Advocate sits down, is he able to give an indication at this stage—I appreciate that it may be difficult—with regard to the increases in staff which may be required by his department to consider the documents that will presumably need to be submitted to the Lord

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Advocate in terms of the amendment? The amendment states that they must be submitted before any person can request them in terms of Clause 1 (3) of the Bill. Can he give us an idea of the potential cost of that exercise?
I merely seek information. I recognise that the terms of the amendment are extremely helpful. I can see that behind it there may be a purpose in saving money and making it work for the charities concerned. Rather than having a trust deed or other documents which can be very lengthy, a simplifed document initially would serve everyone's purposes.
Lord Fraser of Carmyllie: My Lords, I clearly cannot calculate at this stage how many bodies might approach me in seeking my approval. Contrary to what the noble and learned Lord, Lord Morton, said, I envisage that most bodies which already have a clearly defined trust deed will put that forward. One needs to consider—and what I envisage will occur in relation to any directory—that often a trust deed is a long, complicated document. For their own purposes charities may wish in explaining what they do to provide a simplified explanation of their range of activities and how they expend their funds.
The amendment is intended to relate to such bodies as the Church of Scotland or the Roman Catholic Church. I would not wish for a moment to suggest what the Roman Catholic Church might put forward. I do not envisage that I shall have any difficulty in approving a document put forward by the Church.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 3:
Page 2, line 29, leave out from ("its") to ("as") and insert ("explanatory document").
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 4:
Page 2, line 34, leave out ("Court of Session") and insert ("court").
The noble and learned Lord said: My Lords, in moving Amendment No. 4 I speak also to Amendments Nos. 6, 11, 23, 25, 45, 46 and 48. Notwithstanding that long list, these amendments seek to give effect to the undertaking given by me in Committee to allow, at my discretion, cases to be heard in the sheriff court as well as the Court of Session in all cases where I have power to apply for an interdict or order. Your Lordships will recall that I did not consider it appropriate to do so in Clause 6 in view of the gravity of the measures involved under that section. Clause 8 already contains provisions under subsection (5) for me to appoint a day for extension of proceedings to the sheriff court under that section. The amendments also provide the necessary definition in Clause 13. I beg to move.
On Question, amendment agreed to.
Lord Cameron of Lochbroom Lord Cameron of Lochbroom moved Amendment No. 5:
Page 2, line 35, after ("body") insert ("if incorporated").
The noble and learned Lord said: My Lords, in moving this amendment I speak also to Amendments Nos. 12 to 14, 24 and 27 to 30 standing in the name of my noble and learned friend Lord Morton and myself and also to Amendment No. 47 in the name of the noble and learned Lord the Lord Advocate.
These amendments are directed to a point raised by my noble and learned friend in Committee with regard to the status at law of unincorporated bodies, which certain of the recognised bodies will be. These are not legal persons in the eyes of the law of Scotland and therefore cannot be sued in any legal proceedings.
I refer particularly to Amendment No. 30, which seeks to give the court slightly wider discretion than is presently incorporated within the Bill. It is intended to be helpful. It may be that Amendment No. 47 covers the point which I seek to make in Amendment No. 5 and the remaining ones. I shall be happy to listen to what the noble and learned Lord says and I also welcome his view on Amendment No. 30. I beg to move.
Lord Fraser of Carmyllie: My Lords, the noble and learned Lord, Lord Cameron of Lochbroom, raised a question in Committee on Clause 1 (5) as to whether it was possible to interdict an unincorporated body. I undertook to give this matter further thought. According to Stair Encyclopaedia, Vol. 2, para 818, it would appear to be the case that it is not possible for such bodies to sue or be sued in the Court of Session although it may be possible in the sheriff court. I concluded that the safest course is to make specific provision. Amendment No. 47 therefore extends the present limited definition of "body" in Clause 13. I am grateful to the noble and learned Lord for drawing the matter to my attention.
It is intended that Amendment No. 47 covers the matters raised in the amendments of the noble and learned Lord, including Amendment No. 30. However, I will look at the position again to see whether there is anything that is usefully more extensive than is provided for in Amendment No. 47. I repeat my thanks to the noble and learned Lord, but hope that he will withdraw his amendment.
Lord Cameron of Lochbroom: My Lords, I am grateful to the noble and learned Lord. He has obviously taken the point on board. I will look at what he said. I am also grateful for his offer to reconsider the substance of Amendment No. 30. In those circumstances I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 6:
Page 2, line 37, leave out ("Court") and insert ("court").
On Question, amendment agreed to.
[Amendment No. 7 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 8:
Page 3, line 5, at end insert:
("(8) In this section "explanatory document" means —

(a) the trust deed of a body or other document constituting the body; or

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(b) such other document as the Lord Advocate may approve, being a document which describes the nature of the body and of its charitable purposes.").

On Question, amendment agreed to.
Clause 2 [Non-recognised bodies]:
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 9:
Page 3, line 10, at end insert:
("(b) any Church or other body established for the advancement of religion or established for the purposes of providing, holding, maintaining, repairing or managing ecclesiastical buildings for religious purposes").
The noble and learned Lord said: My Lords, this amendment has in a sense been foreshadowed by what the noble and learned Lord the Lord Advocate said. It was tabled merely in order that something should appear on public record regarding what is happening concerning the Churches.
As the noble and learned Lord said, discussions have taken place with the Scottish Churches Committee concerning the method of dealing with them in relation to charitable purposes, but agreement has not yet been reached. We hope that it will be. At this stage—as no doubt the noble and learned Lord the Lord Advocate will deal with them in reply—I wish to mention some of the difficulties that his intended approach appears to raise.
One difficulty is that the body, the Church or religious organisation, will have to satisfy the Secretary of State that it has membership of not less than 10,000 persons. That is difficult for certain well recognised churches which tend to have numerous adherents rather than members, although those who are not members of that organisation regard the adherent as being a member in any natural sense.
There is also difficulty about various bodies such as the Baptists and the Congregational Union whose organisations perhaps do not fit the other requirement that there should be an internal organisation with a central authority in Scotland exercising supervisory and disciplinary functions. One of the difficulties about that is that if there is to be one central authority in Scotland, it perhaps raises very great difficulties in regard to whether it would fit for a Church which regards its central authority as being in Rome—its central authority on this earth, at any rate—and has eight dioceses in Scotland.
There are difficulties, and I suggest that apart from the detailed points which are still to be discussed, the only way of dealing with this problem is for the Secretary of State or the Lord Advocate to be given powers to designate specific bodies without confining himself to anything more than religious bodies, or something of that nature. Once one goes into the differences of organisations that exist between the different faiths, comparing one with another, it is difficult to obtain one central definition that would fit. I suggest that the only way is to specify the bodies—the Church of Scotland, the Roman Catholic church, the Sikh religion, the Jewish religion, and so on. That is the only way to deal with the problem. Nevertheless, I express my gratitude for the way that the Government have taken the point on board. I beg to move.
4 p. m.
Lord Cameron of Lochbroom: My Lords, before the Lord Advocate replies, perhaps I may also raise one or two further points which occurred to me having been given a copy of the proposed principles on which the Government were intending to bring forward a possible amendment.
The first has already been mentioned by my noble and learned friend regarding the membership of 10,000 and the problems of determining what constitutes a membership. That figure appears to be an arbitrary limit and could discriminate against some of the traditional Churches in Scotland which have a long history but do not rise to quite those numbers. Indeed, one might ask what happens when within such a traditional Church there is a split involving its division into two separate but identifiable units.
Further, one of the principles suggested, or the criterion to be applied, was that such bodies should have as their principal activity the regular holding of acts of public worship. However, within the Churches there are identifiable bodies whose principal activities may be related to the Church itself but directed to other aspects of Church life such as social work. That is a matter which should be taken into account. Furthermore, in the discussions there was some question of waiving certain of the provisions of the Bill in relation to these exempt bodies. I have seen those. Perhaps I may suggest that the exemptions would on any view be best if they included Clauses 1 (3) and (4) as well as (5) and also make provision for exemption wholly from Clause 5 rather than from certain parts of it. That seems to be a much cleaner way.
I simply offer these suggestions because various points have been raised and it would be advantageous to have them on record.
Lord Eraser of Carmyllie: My Lords, as I have already indicated on an earlier amendment, the Government intend to bring forward amendments in another place to deal with the position of established Churches, and I use that description in a loose sense for Scotland rather than in any particular sense.
In bringing forward such amendments, I shall have regard to the points made by noble and learned Lords. While I agree that there is a particularly strong case for exempting the major religious bodies, the amendment proposed is rather too extensive in exempting all bodies established for the advancement of religion. As your Lordships are aware from discussions we had in Committee, I am concerned that there should be a power to act where necessary against certain cult-like sects.
This aspect of charities is a most tricky area. Some are clearly the most honourable and worthwhile bodies in Scotland, but others may well be the most deceitful and dishonourable. Seeking to discover where that line should be drawn is by no means easy. A number of suggestions have been put to the Scottish Churches Committee and we have heard that there may be difficulties over applying the criteria which have been established. I hasten to add that they were not intended to be absolute in any

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sense. It is a matter for discussion. However, I emphasise that we must insist that not all religious bodies are exempt.
At the other end of the argument, while I understand what has also been suggested in regard to listing, the proposal to list, for example, the Church of Scotland Trust and the Church of Scotland Trustees, as appears in Amendment No. 50, is probably unacceptable as it seems likely to give rise to questions of hybridity. In dealing with this issue in Scotland, that is regrettably a further complication in the way the matter is approached.
Baroness Phillips: My Lords, perhaps the Minister, or the movers of the amendment, can give me an explanation. I am a great admirer of the Lord Chancellor. I speak as a member of the Church of Rome. At least the Pope is a delegate, ultimately, for someone above. Are we considering this particular Church known as the "wee frees"? That Church did not seem to me to be of a very liberal character. I would not support the amendment if that church is to be included.
Lord Morton of Shuna: My Lords, despite the persuasive invitation from the noble Baroness, Lady Phillips I have no intention of discussing one Church as against another, let alone any Church that has recently divided itself.
The difficulty of my amendment was well recognised, but it was tabled only as a vehicle for discussion. It is very necessary that any listing or provision should cover not only the Christian Churches but the other religions which exist to a considerable extent in Scotland. While I agree that there may be one or two cults —the word used by the noble and learned Lord the Lord Advocate—which would rot be appropriate, that is a matter for his judgment. We must deal with this matter in some way, but it appears to me that the only way is to list the organisations that are to be excluded. However, at this stage I ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Cameron of Lochbroom Lord Cameron of Lochbroom moved Amendment No. 10:
Page, line 15, at end insert ("; nor—
(c) a charity having neither any permanent endowment nor any income from property amounting to move than £500 or such other sum as the Secretary of State may, by regulation, from time to time prescribe, nor the use and occupation of any heritable property").
The noble and learned Lord said: My Lords, this amendment takes up a point made within short compass in the general debate in Committee regarding Churches. It seeks to withdraw the very small charities from the prohibition in Clause 2 (1) and thus allow them to operate without the necessity to obtain recognition from the Inland Revenue. These are the small charities that have no desire to secure funds by way of gifts under convenant. Indeed, they may be of a character which would be more commonly recognised as public charitable trusts in the eyes of the law and not those which fall within the prescribed definition of a charity for taxation purposes. The existence of such public charitable
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trusts is recognised in Clause 8 of the Bill. That is in contrast to the terms used in Clause 9, which speak about a public trust which is a recognised body. It is one which has passed the Inland Revenue test.
As the Bill is framed at present, in order to hold itself out as a charity, a small charity would be required to apply first to the Inland Revenue for recognition, although it would not wish the benefit of the taxing statutes. But only if such recognition were granted would it then be able to hold itself out as a charity. If it were refused, the prohibition would bite; and that would seem unfortunate. On the other hand, if it were granted, the small charity would then have to pass the next hurdle of being exempted from the accounting rules. Otherwise it would become liable to the accounting rules.
It seems somewhat unnecessary to make small charities pass two statutory hurdles simply to provide them with the comfort of being able to call themselves a charity. One might ask whether the Inland Revenue would welcome a further increase in the number of bodies applying for recognition in order to escape the prohibition, in particular where the Inland Revenue would have no interest in the result and the body would have no interest in the provisions of the taxing statutes which might be favourable to other charities. What is the public interest in requiring small charities to be so supervised? There seems to be a case for exempting very small charities. That is what the amendment seeks to do. It begins with the provision for the upper limit of the charity's annual income which can be altered according to events. I am anxious to hear what the noble and learned Lord the Lord Advocate has to say on the distinction between a charity under the taxing statutes and a charity as defined in Scots law generally. I beg to move.
4.15 p.m.
Lord Morton of Shuna: My Lords, the matter was discussed fairly briefly in Committee with the amendment about churches, as I recollect. It seems totally wrong that a small body such as a committee which organises a collection or a sale of work once a year to take children from a hospital to the seaside should have to register or run the risk of committing offences for which members of the committee will apparently be liable for about six months' imprisonment. That seems utterly wrong. From the discussion in Committee everyone seems to have agreed that some exemption for these very small charities was desirable from the point of view of administration and everything else. I hope that the noble and learned Lord will say something that deals with the problem.
Lord Fraser of Carmyllie: My Lords, as has been indicated, we have discussed the matter previously. It is the undoubted policy of the Bill to provide supervision over all Scottish charities. That the provision should apply to all charities, irrespective of size, was a policy strongly advocated to the Government by the Scottish Council for Voluntary Organisations. It is difficult to know what should be the appropriate cut-off point if this exception is

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made. The figure that the noble and learned Lords have selected might be varied without much difficulty one way or the other.
We have accordingly sought to approach the matter in a different way. That is by providing in Clause 4 that the requirement to produce accounts should be tempered. Small charities are not to be required to produce an income and expenditure account—I recognise that that would be a gross imposition on them—but need prepare only a receipts and payments account. Similarly they will be relieved of the requirement to have their accounts audited professionally.
Should a charity have the use and occupation of heritable property we would still wish to supervise it. Moreover, it is open to small charities to amalgamate to form larger trusts or to reform their objects without recourse to the court under the provisions of Clause 9. Why therefore should any provision be made to exempt the small trust? We seek to achieve working efficiency by transfers and amalgamations.
My noble and learned friend Lord Cameron of Lochbroom drew attention to a point of difference that appears at present in relation to Clauses 8 and 9. On a previous occasion we have had a learned discussion as to what is a Scottish charity as opposed to a charity recognised by the Inland Revenue and what is a public trust within the law of Scotland. It would be my intention to bring that into line and ensure that under Clause 9, if there were a trust which was public according to the law of Scotland but which was not charitable according to the test in the Pemsell case, it would nevertheless be in a position to take advantage of what I have previously described as the new administrative cy près arrangements. Although the matter effectively arises at a later stage, it has been raised and I hope that I have reassured the noble and learned Lord, Lord Cameron.
In policy it is difficult to determine where the line should be drawn. However, we have taken the advice that has been proffered to us that if there is to be proper supervision of Scottish charities it should extend to all such charities. I hope that that is suitably tempered by reference to Clause 4. As a consequence of this part of the Bill, such bodies will also enjoy new opportunities by way of cy près to reorganise themselves or to amalgamate.
Lord Cameron of Lochbroom: My Lords, I am somewhat reassured by the attitude of the noble and learned Lord. I am sure that he will read what my noble and learned friend and I have said about small charities. I am not entirely sure that he has hoisted aboard the point about the local gala day which may not be held for a purpose that would be regarded as charitable under the Pemsell case but would still be a charitable purpose under the law of Scotland. It would be a curiosity that that committee would be prohibited from calling itself a charity. What otherwise would it be?
However, I recognise that the noble and learned Lord has listened. I take on board what he has said about my later amendment. In the circumstances I beg leave to withdraw the amendment.
Amendment, by leave withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 11:
Page 3, line 17, leave out ("Court of Session") and insert ("court").
On Question, amendment agreed to.
[Amendments Nos. 12 to 14 not moved.]
Clause 4 [Annual accounts and report]:
Lord Cameron of Lochbroom Lord Cameron of Lochbroom moved Amendment No. 15:
Page 4, line 17, at end insert ("which shall include a statement of the principal charitable purposes of the body and the names of the persons concerned in its management or control during the year").
The noble and learned Lord said: My Lords, I speak also to Amendment No. 16. The purpose of the amendment is to provide for the incorporation in the reports prepared by recognised bodies information with regard to those who were responsible for the charity's activities during the year covered by the annual report and a statement of its principal purposes. Such a statement may well have been the subject of amendment by the noble and learned Lord the Lord Advocate. It would be helpful for an annual report to contain such information. It would provide for greater accountability, which is one of the matters with which the Government were concerned in this legislation. It might even be helpful in the preparation of an index by an interested body. I beg to move.
Lord Fraser of Carmyllie: My Lords, I am wholly sympathetic to the aim of the amendments but I do not believe that it is necessary for them to appear on the face of the Bill. My right honourable friend the Secretary of State has powers under Clause 4 (5) to prescribe by regulations the form and content of accounts including any information to be provided by way of notes to the accounts. An inquirer has a right to obtain a copy of the actual trust deed under the provisions of Clause 1 (3). That provision was inserted at the suggestion of the SCVO in preference to a summary of the principal objects. The notes will, however, require a summary of the body's activities over the year having regard to its charitable purposes. As my noble and learned friend suggested, this allows something of a reference back to the making up of a directory if that is what is wanted.
I can confirm that it is my right honourable friend's intention to prescribe in regulations that the names and designations of those who are or have been concerned with the management and control of the body during the financial year should be listed. I hope that my explanation meets my noble and learned friend's point. With that undertaking I trust that he will feel able to withdraw the amendment.
Lord Cameron of Lochbroom: My Lords, I am most grateful to the noble and learned Lord. I am perfectly content with what he has said. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 16 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 17:
Page 4. line 36, after ("thereon") insert ("and as to the consideration of the report").
The noble and learned Lord said: My Lords, Clause 4(5)(c) makes provision enabling my right honourable friend the Secretary of State for Scotland to prescribe by regulation requirements as to auditing the accounts which recognised bodies are required to prepare in accordance with the provisions of the Bill.
Since the report which forms part of the statement of accounts will require to be consistent with the audited accounts the auditor will need to address this point in his examination. The amendment makes plain that my right honourable friend may prescribe requirements as to that aspect of the audit. I beg to move.
Lord Morton of Shuna: My Lords, this is no doubt a very good purpose but I am not entirely sure that the words actually achieve that purpose. They certainly do not make it clear. Subsection (5) (c) would now read:
"such requirements as to auditing of the balance sheet, statement of balances, income and expenditure account and receipts and payments account and any notes thereon and as to the consideration of the report as he considers appropriate".
It is not easy to take much meaning out of that sentence. Whose consideration of the report is supposed to be involved? It is not at all clear who is to do the considering. Perhaps the noble and learned Lord will consider that matter.
Lord Fraser of Carmyllie: My Lords, the powers look very similar to those provided in Section 9 of the Companies Act 1989. If they have not been entirely helpfully introduced into the clause I shall look at the matter. I hope that the noble and learned Lord will appreciate that I am not giving an undertaking to come back with anything.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 18:
Page 4, line 42, after ("shall") insert ("(a)").
The noble and learned Lord said: My Lords, it may be helpful if I speak at the same time to Amendments Nos. 19, 21 and 22. Subsection (7) requires a recognised body to provide on payment of a reasonable charge a copy of its most recent statement of annual accounts to any person who requests it. It will not necessarily be clear to the person concerned whether the accounts are in fact the latest available or whether another set is overdue unless he can ascertain the date to which the accounts are required to be made up. In particular it will be important in the case of a body which has not at that point produced any accounts for the inquirer to be able to ascertain when the first accounts are due to be produced.
Amendments Nos. 19 and 22 provide therefore that the body will also be required to inform inquirers of that date and enable me to direct that any failure to provide this information may be noted by the Inland Revenue for the purposes of Clause 1 (2). Amendment No. 18 is consequential.
Amendment No. 21 and the first part of Amendment No. 22 also take account of the point raised in Committee by my noble and learned friend Lord Cameron that it would be unfortunate if a person were able to complain under Clause 1 (4) or Clause 4 (12) when he had requested information but had failed to tender the reasonable charge for either a copy of the body's trust deed or its accounts. I undertook to give some further thought to that. I am content that no amendment is required to Clause 1 (4), but the same point is not covered in the existing wording of Clause 4 (12) in relation to the provision of annual accounts. Accordingly, Amendment No. 21 and the first part of Amendment No. 22 make provision for this. I am grateful to the noble and learned Lord for drawing the point to my attention. I beg to move.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 19:
Page 4, line 45, at end insert:
("(b) inform any person who requests it of its accounting reference date.").
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 20:
Page 5, line 23, leave out ("responsible for") and insert ("concerned in").
The noble and learned Lord said: My Lords, in Committee the noble and learned Lord, Lord Cameron, indicated a difference in terminology between what were formerly subsections (7) and (8) of Clause 4 and are now subsections (9) and (10). The amendment brings the terminology in subsection (10) into line with that in subsection (9). Once again I am grateful to the noble and learned Lord. I beg to move.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 21:
Page 5, line 32, after first ("person") insert ("(a)").
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 22:
Page 5, line 33, after ("accounts") insert ("as mentioned in subsection (7) above; or
(b) fails to inform that person of its accounting reference date,").
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 23:
Page 5, line 37, leave out ("Court of Session") and insert ("court").
On Question, amendment agreed to.
[Amendment No. 24 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 25:
Page 5, line 41, leave out ("Court") and insert ("court"). On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 26:
Page 5, line 44, after ("(1)") insert ("(2),(3),").
The noble and learned Lord said: My Lords, subsections (2) and (3) of Clause 4 specify what elements must be included in statements of accounts prepared by a recognised body. However, there are separate provisions in the Companies Act 1989 governing the form and content of accounts which must be prepared by companies. The company provisions take precedence over those in the current legislation for the supervision of charities. The amendment adds subsections (2) and (3) of Clause 4 to the list of provisions which do not apply when a recognised body is a company. I beg to move.
On Question, amendment agreed to.
Clause 6 [Powers of Court of Session to deal with management of charities]:
[Amendments Nos. 27 to 30 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 31:
Page 10, line 34, leave out from ("severally") to end of line 36.
The noble and learned Lord said: My Lords, the noble and learned Lords, Lord Morton of Shuna and Lord Cameron of Lochbroom, and the noble Lord, Lord Macaulay of Bragar, raised in Committee on 27th March the question of awarding expenses against a person who was not a party to the court proceedings and suggested that the proviso that such a person shall be entitled to be heard on the question of expenses did not go far enough. I gave an assurance that the matter would be looked at further. Having done so, I have concluded that it would be preferable to omit all reference to,
"notwithstanding that he is not a named party to the proceedings … provided that he is allowed to be heard on the question of expenses".
This formulation was intended to provide for the situation where the names of persons involved in the running of a bogus charity might come to light only in the course of an action and was drafted to provide that it would not be necessary to hear all the evidence again. However, in view of the strong representations which have been made about this provision I have decided that the better course is to delete the provision altogether. As a result of my amendment it will be open to parties to an action who wish to have an individual cited in proceedings to sist the proceedings and to call as co-defender any person whom he alleges is involved in the management or control of the body and for the court to hear that person's evidence in the normal way. As I have just indicted, this puts it in the practice and traditions of the court. I trust that now that the features that the noble and learned Lords found objectionable in this provision have been removed they may be able to support the amendment.
4.30 p.m.
Lord Macaulay of Bragar: My Lords, as a point of information, is the noble and learned Lord the Lord Advocate saying that, where it is proposed that a person might have expenses awarded against him in
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any action, he will be formally cited to the court before any decision is made by the parties to the action? Thus there will be no instance of a case where a person suddenly finds himself liable for £400 of expenses that he had never heard of before he perhaps gets a summons or a visit from the sheriffs officer.
Lord Fraser of Carmyllie: Yes, my Lords, I can confirm that. The history of this is that we started off by thinking how can we get at these people who are behind a bogus trust. When action is taken, how do you get on to them and take some action against them? We modified that to say that if expenses were going to be awarded against them they ought at least to have the right to be heard.
Even with that modification to the original proposal there was objection from the noble and learned Lord and others to this innovation concerning what would ordinarily be the position in the Scottish courts. Having reflected on it, I have concluded that the simplest way is to stick to the ordinary arrangements and avoid any attempt at some new arrangement.
On Question, amendment agreed to.
Clause 9 [Small charities]:
Lord Cameron of Lochbroom Lord Cameron of Lochbroom: moved Amendment No. 32:
Page 13, line 16, leave out ("which is a recognised body").
The noble and learned Lord said: My Lords, the purpose of this amendment and the related amendment to which I beg leave to speak. Amendment No. 44, is simply to enable these sensible provisions to be extended to all public trusts whether or not they are recognised bodies—that is to say, bodies which have passed the Pemsell tests and been recognised by the Inland Revenue. As I say, these are sensible provisions and I understand from what the noble and learned Lord has already said that he is favourably inclined to these amendments. I beg to move.
Lord Fraser of Carmyllie: My Lords, as I have hinted previously, I have considered the suggestions made at Committee stage by the noble and learned Lord and others on this issue and have decided that there is a case for extending the facility that arises under Clause 9 to all public—and I stress the word to the noble and learned Lord, to whom it doubtless makes sense—trusts. The Government intend to bring forward amendments at Committee stage in the other place to facilitate this. In bringing forward an amendment it will be necessary to ensure that where one of the bodies in an amalgamation is already a recognised body, the objects of the reconstituted body would continue to be such.
My Lords, I have indicated that I accept the principle, advocated by the noble and learned Lord at Clause 9, that the facility to reorganise under the provisions of that clause should be extended to small public trusts irrespective of whether they are recognised bodies. Having accepted that principle, I would also accept that there is little justification for restricting the facility for very small trusts with an

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annual income of less than £1,000 to those which have charitable purposes.
I would therefore accept in principle the amendment. However, I fear that by removing the word "charitable" without further qualification we would be opening up this facility to all trusts—not just charitable ones but public and private ones. I suspect that a further amendment may be necessary to make clear that the clause applies only to public trusts and charitable trusts. Subject to that proviso I am happy to accept the noble and learned Lord's amendment in principle, and thank him again for bringing, this matter before us. Given those assurances, I hope that he will feel able to withdraw this amendment.
Lord Cameron of Lochbroom: My Lords, I am grateful to the noble and learned Lord. In the circumstances I am happy to seek the leave of the House to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 33:
Page 13, leave out lines 19 to 23 and insert:

("(a) that the original purposes of the trust, whether in whole or in part—

(i) have been fulfilled as far as it is possible to do so; or

(ii) can no longer be given effect to, whether in accordance with the directions or spirit of the trust deed or other document constituting the trust or otherwise;

(b) that the original purposes of the trust provide a use for only part of the property available under the trust;

(c) that the original purposes of the trust were expressed by reference to—

(i) an area which has, since the trust was constituted, ceased to have effect for the purpose described expressly or by implication in the trust deed or other document constituting the trust; or

(ii) a class of persons or area which has ceased to be suitable or appropriate, having regard to the spirit of the trust deed or other document constituting the trust, or as regards which it has ceased to be practicable to administer the property available under the trust; or

(d) that the original purposes of the trust, whether in whole or in part, have, since the trust was constituted—

(i) been adequately provided for by other means; or

(ii) ceased to be such as would enable the trust to become a recognised body; or

(iii) ceased in any other way to provide a suitable and effective method of using the property available under I he trust, having regard to the spirit of the trust deed or other document constituting the trust,").

The noble and learned Lord said: My Lords, during the Committee stage of the Bill on 27th March I undertook to bring forward at Report amendments to Clause 9 to bring its provisions into line with Clause 8. The provisions of this amendment require trustees of small charities who wish to reorganise the objects of their trust, or to amalgamate with another trust, to be satisfied on all the points a court would be required to have regard to under Clause 8. It is clearly desirable that the same basic criteria should apply to reorganisation whether it takes place in court under the provision
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of Clause 8 or without recourse to the court under the Clause 9 provisions. I beg to move.
Lord Cameron of Lochbroom: My Lords, I wonder whether the noble and learned Lord has considered the scenario that a trust may see, and indeed obtain, leave to reconstitute itself so that new purposes come into effect and a new trust then comes into being, and some 30 years later those purposes become incapable of being fulfilled? The problem I have is that as presently drafted the words that first appear are "original purposes of the trust".
It seems to me that some thought might be given to the altered trust purposes—as, for instance, those that come under Amendment No. 37—being deemed to be original purposes, so that any subsequent rearrangement that may well come about can be comprehended by this clause. Apart from that, it seems to me that this is a helpful amendment and I would certainly support it.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 34:
Page 13, line 29, leave out ("or").
The noble and learned Lord said: My Lords, together with Amendment No. 34 it might be useful if I were to speak also to Amendments Nos. 35 through to Amendment No. 43. These are essentially clarifying amendments the intention of which is to make plain that, as well as modifying the purposes of their trust or transferring the assets of the trust to another public trust, trustees may amalgamate with one or more public trusts. The amendments also prescribe the circumstances trustees must have regard to before resolving to amalgamate.
My Lords, Amendment No. 35 enables the trustees to determine that their trust should be amalgamated. Amendment No. 37 inserts a new subsection (9A), which enables the trustees to pass a resolution to amalgamate with one or more trusts and requires them to be satisfied that the charitable purposes of the new trust should be similar in character to the existing trust.
The same amendment inserts new subsection (9B). Under this subsection the trustees are required before passing a resolution under (9A) to have regard to any particular locality to which the trust purposes relate, to ensure that the new trust will continue to be eligible for tax exemption, and to ascertain that the trustees of the other trusts involved are agreeable to the amalgamation. Your Lordships will note that these requirements at new subsection (9B) correspond exactly with those at existing subsection (9) which relate to the transfer of assets. All the other amendments are consequential. I beg to move.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendments Nos. 35 to 43:
Page 13, line 31, at end insert (", or
(c) that the trust should be amalgamated with one or more public trusts."),
Page 14, line 13, after second ("trust") insert ("or trusts").

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Page 14, line 28, at end insert:
("(9A) Where the trustees determine as mentioned in subsection (2) (c) above, they may pass a resolution that the trust be amalgamated with one or more other trusts so that the charitable purposes of the trust constituted by such amalgamation will not be so dissimilar in character to those of the trust to which the resolution relates as to constitute an unreasonable departure from the spirit of the trust deed or other document constituting the last mentioned trust.
(9B) Before passing a resolution under subsection (9A) above, the trustees shall —

(a) where the trust purposes relate to a particular locality, have regard to the circumstances of the locality;

(b) ensure that the trust purposes of the trust to be constituted by such amalgamation will be such as to enable it to be granted an exemption from tax by the Commissioners of Inland Revenue under section 505 (1) of the Income and Corporation Taxes Act 1988 (exemption from tax for charities); and

(c) ascertain that the trustees of any other trust with which it is proposed that the trust will be amalgamated will agree to such amalgamation.").

Page 14, line 29, after ("assets") insert ("or an amalgamation of two or more trusts").
Page 14, line 36, leave out ("or (8)") and insert (", (8) or (9A)").
Page 14, line 44, after ("otherwise") insert ("(a)").
Page 14, line 45, leave out ("or, as the case may be") and insert ("(b)").
Page 14, line 46, after ("above") insert ("; or
(c) that the trust should not be amalgamated as mentioned in subsection (9A) above").
Page 14, line 48, at end insert ("or amalgamation").
The noble and learned Lord said: My Lords, I beg to move Amendments Nos. 35 to 43 en bloc.
On Question, amendments agreed to.
Clause 10 [Expenditure of capital]:
[Amendment No. 44 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 45:
Page 15, line 23, leave out ("Court of Session") and insert ("court").
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 46:
Page 15, line 24, leave out ("Court") and insert ("court").
On Question, amendment agreed to.
Clause 13 [Interpretation of Part I, regulations and orders]:
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 47:
Page 16, line 9, at end insert ("and, as regards any reference in this Part of this Act to the institution of proceedings in any court or to any order of a court, shall be construed—

(a) in the case of a trust, as a reference to the trustees acting in their capacity as such;

(b) in any other case, as a reference to the persons concerned in the management or control of the body;").

On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 48:
Page 16, line 9, at end insert (""court", for the purposes of establishing jurisdiction to hear or determine any matter other
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than under sections 6 and 8 of this Act, means the Court of Session or the sheriff;").
The noble and learned Lord said: I beg to move.
Lord Macaulay of Bragar: My Lords, the amendment has already been spoken to, but perhaps I may draw the noble and learned Lord's attention to the definition of "court" in Amendment No. 48. It states that the word "court" means:
"the Court of Session or the sheriff".
The sheriff is a person. He is not a court. As a matter of construction should not that read "sheriff court" rather than the sheriff as an individual? I put that forward in a helpful spirit.
Lord Fraser of Carmyllie: My Lords, I shall check that point and see what the context is. Undoubtedly the point made by the noble Lord is correct.
On Question, amendment agreed to.
[Amendments Nos. 49 and 50 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 51:
Page 16, leave out lines 30 to 41 and insert:
("(5) A recognised body's accounting reference date is the date upon which its accounting reference period ends in each calendar year and it shall be ascertained as follows—

(a) in the case of a body which is recognised at the commencement of this section and in respect of which accounts have been prepared up to a date not more than 12 months before such commencement, its accounting reference date shall be that date;

(b) in the case of a body which is recognised at the commencement of this section and in respect of which no such accounts have been prepared, its accounting reference date shall be 31 March or such other date as the Secretary of State may, by order, prescribe;

(c) in the case of a body which is not recognised at the commencement of this section and in respect of which accounts have been prepared up to a date not more than 12 months before its recognition, its accounting reference date shall be that date; and

(d) a body which is not recognised at the commencement of this section and in respect of which no accounts have been prepared up to a date not more than 12 months before such commencement, unless it determines that its accounting reference date shall be 31 March or such other date as the Secretary of State may, by order, prescribe, shall by notice given to the Lord Advocate specify its accounting reference date.").

The noble and learned Lord said: My Lords, this is a somewhat technical amendment, but its effect is to ensure that a recognised body in preparing the annual accounts it is required to maintain under the terms of Clause 4 may exercise choice as to what should be its accounting reference date. The accounting reference date is the date to which accounts are produced. An important effect of these amendments will be to ensure that where a body already prepares accounts to a particular date it will not have to change that date because of the requirements of the Bill. I beg to move.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 52:
Page 16, line 44, leave out from ("section") to end of line 45 and insert ("and in respect of which any accounts have been

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prepared for a period up to a date not more than 12 months before such commencement, the period beginning with that date;
(aa) in the case of a body which is recognised at such commencement and in respect of which no such accounts have been prepared, the period beginning with such commencement").
The noble and learned Lord said: My Lords, this is a clarifying amendment to make explicit when the first accounting reference period for a recognised body is to commence. In the case of a body already recognised at the commencement of this clause of the Bill, which has completed accounts in the past 12 months, the period begins with the date of the completion of such accounts. In the case of a body also so recognised but which has not completed any such accounts, the period begins with the commencement date of this clause. I beg to move.
On Question, amendment agreed to.
Clause 14 [The Scottish Conveyancing and Confirmation Practitioners Board]:
[Amendment No. 53 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 54:
Page 17, line 24, leave out ("Confirmation Practitioners") and insert ("Executry Services").
The noble and learned Lord said: My Lords, this involves a very extensive list of amendments. The principal amendment is Amendment No. 54, but the other important amendments within this large batch are Amendments Nos. 85, 101, 120 and 236. It is a large batch of amendments, but that is merely because they are all part of our revised scheme for the regulation of those who provide what we now refer to as executry services. By that I mean the area covered by the statutory reservation for confirmation of executors and related activities for the administration of the estate.
As I said in Committee on 27th March when we discussed amendments moved by the noble and learned Lord, Lord Morton of Shuna, I intended to have a further look at the whole area with my right honourable friend the Secretary of State for Scotland. I said then that I had some sympathy with the noble and learned Lord's amendments, but I thought that they might be too wide-ranging in the sense of imposing a strict regulatory regime for financial institutions which were already providing a satisfactory service in executry work.
The arrangements which we now propose, which are expressed in this extensive group of amendments, envisage essentially a two-tier form of regulation for those who provide executry services, as now defined, to include the administration, in-gathering, distribution and winding up of an estate as well as work connected with confirmation itself.
There will be two categories of providers. The first group comprises those who are already regulated under statute; that is to say, banks, building societies and insurance companies. Within that group lie bodies such as the main Scottish banks which already do executry work but which may not now of course
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handle confirmation. We believe that that group is already adequately regulated to provide satisfactory consumer protection. We intend therefore to exempt bodies in that group from the offence provisions relating to the confirmation of executors. They will have to notify the board that they intend to offer executry services and that they belong to a complaints system which complies with any regulations that may be made by the Secretary of State in respect of dealing with complaints.
The board will maintain a list of such bodies and will make it available for public inspection but will not have any regulatory responsibilities for them. The exemption of those bodies from the offence provisions relating to confirmation will be dependent upon their complaints scheme operating in practice in the manner indicated to the board. If that does not prove to be the case, then the offence provisions will stand. That matter is covered by Amendment No. 101.
The regulation of other providers of executry services will, subject to some important changes which I shall explain shortly, be broadly the same as that for providers in the Bill as discussed in Committee. Prospective providers will have to apply to the board for registration and will have to satisfy the board that they are fit and proper persons to provide the services; that they comply with the requirements of the regulations governing education, conduct and practice; and that they have some form of indemnity insurance cover. If they satisfy the board in all those respects they will be admitted to the register and will be entitled to provide executry services under the title of executry practitioners.
The two additional important changes to which I have referred in passing are that the responsibility for the rules of conduct and practice will now rest with the Secretary of State and not with the board. That change is made in recognition of an extended definition of the regulated area. Provision is now made to place the Secretary of State under the statutory duty to make regulations for the maintenance of appropriate standards of conduct and practice of executry practitioners. Those regulations will be made after consultation and are broadly comparable to what is to be provided for conveyancing. That is Amendment No. 85.
The other important change is found in Amendment No. 236. It is also made in recognition of the extended definition of a regulated area in that executry practitioners will be covered by the board's compensation fund. The amendments go a long way towards meeting the concerns expressed in Committee about the degree of regulation necessary over new providers of services relating to executries while avoiding imposing an over-regulatory regime on financial institutions which are regulated separately.
I trust that I have outlined the main features of the new scheme. I apologise for the fact that it has taken some time to do so, but this is probably the most important set of amendments that I shall introduce on Report. Obviously it will be necessary to make a large number of consequential amendments, but I think that they are essentially self-explanatory. I beg to move.
Lord Morton of Shuna: My Lords, I am grateful to the noble and learned Lord for having taken wholly on board the principle which I sought to establish in the amendments I moved in Committee to extend the provision to executry. That is the reason I did not move the previous amendment. I apologise to the noble and learned Lord if I caught him short, so to speak, by not moving it. The arrangements now put forward by the Government in this group of amendments seem entirely satisfactory. I am grateful that the Government have taken them on board.
Lord Macaulay of Bragar: My Lords, I wish to adopt the views expressed by the noble and learned Lord, Lord Morton of Shuna. The areas with which the amendments deal are important for normal, ordinary individuals. The noble and learned Lord the Lord Advocate stated quite properly in relation to Amendment No. 85 that these were important matters. The terms of that amendment go to the heart of the conduct on the part of the new statutory animal, if I may call it such with no disrespectful intent.
The regulations will be directed to maintaining appropriate standards of conduct and practice of executry practitioners. Such regulations may make provision as to educational qualifications and practical training. These regulations cover a wide spectrum, therefore.
Your Lordships will note that the new subsection (11) of Clause 17 in Amendment No. 85 states that:
"Regulations under subsection (10).. shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament".
Noble Lords will find a similar provision if we move on to Amendment No. 101. Amendment No. 66 in the name of the noble and learned Lords, Lord McCluskey and Lord Morton of Shuna, of myself and the noble Lord, Lord Carmichael of Kelvingrove, has not yet been spoken to. The amendment deals with negative and affirmative resolutions and sets out to indicate that:
"No instrument shall be made under this section unless a draft of the instrument has been approved by resolution of both Houses of Parliament".
A question of principle has been raised here. My understanding of Amendment No. 66 is that it is analogous to Clause 93 of the Courts and Legal Services Bill, which recently passed through your Lordship's House in relation to English conveyancing practitioners. Of course, the question of the executry practitioners and confirmation practitioners did not arise in the course of the English Bill, as I recall.
The noble and learned Lord the Lord Chancellor conceded that the proper course in relation to these new practitioners was to have an affirmative resolution, not a negative resolution of the House. Statutory instruments leave it all to chance as to whether people discover what is being done in any sphere. I make my observations at this stage in order to ask the noble and learned Lord the Lord Advocate whether he will take away Amendment No. 85 (11 and Amendment No. 101 (5) in order to consider whether, in the light of the provisions in the
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comparable Bill for England and Wales, it would at least be equitable that the same procedure should apply in Scotland. I await the reply of the noble and learned Lord with interest.
Lord McCluskey: My Lords, I too wish to congratulate the noble and learned Lord the Lord Advocate on having listened to representations and to the debate on this matter. I notice that we put down an amendment to line 22 of the words that appear in italics. It may be that that is part of the Bill which one cannot amend.
I wish to ask the noble and learned Lord the Lord Advocate two questions, one of which is about a matter which is not entirely clear to me. Once one has dealt with solicitors as providing executry services and then with recognised financial institutions, who else is left to be subject to the regulation and to the establishing of educational qualifications and practical training? Whom do the Government seek to regulate? This is not entirely clear to me from what has been said on previous occasions.
Further, on Amendment No. 85, to which the noble and learned Lord the Lord Advocate spoke, once again there is the use of the word "shall" in the first line and "may" in the sixth line. When the noble and learned Lord the Lord Advocate considers these matters further, I ask him to bear in mind the point that was made in relation to other parts of the Bill. It is slightly odd to lay upon the Secretary of State a duty to make regulations and then to give him total discretion as to what he may insert or omit.
The most important provision that he would insert in the regulations—and no doubt that is why it is specified in Amendment No. 85—is the making of provisions as to educational qualifications and practical training. I should have thought therefore that the noble and learned Lord the Lord Advocate would be persuaded that that was an appropriate place in which to use "shall" instead of "may". However I do not wish to spoil the party—at least not at this stage in the afternoon. Accordingly I am happy to welcome the amendments of the noble and learned Lord the Lord Advocate.
Lord Fraser of Carmyllie: My Lords, perhaps I may respond briefly to the variety of points made. Concerning "may" and "shall", we shall come to a separate amendment on that later and I shall leave it until then. Similarly, I listened carefully to what the noble Lord, Lord Macaulay, said about affirmative and negative resolutions. This related particularly to his Amendment No. 66. Perhaps I may suggest that we leave the matter to be dealt with when we reach that amendment.
The one point that I am anxious to clarify was raised by the noble and learned Lord, Lord McCluskey: whom do we seek to regulate if it is not solicitors who are already regulated as members of the Law Society and if it is not an institution provided for under the first part of the tier? What persuaded the Government to introduce this scheme was representations made not only in this House but outside. It was suggested that there might be those

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who were solicitors and who decided that they would hive off their executry business and deal with it as confirmation practitioners. If they were to act thus, they would find that concerning the winding up of the estate, any matters of delay would take them outwith the disciplinary control of the Law Society of Scotland. I am in no position to calculate or estimate whether that would happen or whether there may be other individuals or bodies who are neither lawyers nor forward in the financial institutions to which I have already referred who would wish to set up.
It was appreciated that if such individuals or bodies sought to go into executry matters, they would be acting in an important area beyond any control. For that reason the scheme has been introduced. I hope that it will now provide a complete and full cover for all those who wish to take advantage of these people's services in the future.
The Earl of Selkirk: My Lords, I am disturbed at what the noble and learned Lord has said. He suggests that people will be thought to hold themselves out as competent professional people when they are not. That is what he suggests in making this provision. It seems to me that from the point of view of the public that could be extremely dangerous. I do not know how the noble and learned Lord will confirm that people are competent to do their job. This proposal will do so, within limits, but here are people who do not fall within this provision who may hold themselves out to be competent. They could be a great danger to the public. What does the noble and learned Lord have in mind?
Lord Fraser of Carmyllie: My Lords, it is precisely because I am concerned that there may be those who would carry out executry services in Scotland without there being any control over them that this new scheme was introduced by the Government. It followed the representations made during the Committee stage.
I do not suggest that these people should be allowed to carry out the work without regulation: it is exactly the other way round. As matters stand at present, they could carry out that work. Under the scheme that I am now introducing with these amendments, they will be regulated. I trust that that will be warmly welcomed.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 55:
Page 17, line 25, leave out from first ("the") to end of line 31 and insert ("principal functions of regulating —

(a) the provision of conveyancing services by persons other than —

(i) solicitors providing such services in the course of practising as solicitors; and

(ii) persons mentioned in section 32 (2) of the 1980 Act (unqualifed persons who may draw and prepare documents relating to heritable estate and confirmations); and

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(b) the provision of executry services by persons other than —

(i) solicitors providing such services in the course of practising as solicitors;

(ii) persons referred to in paragraph (a) (ii) above; and

(iii) recognised financial institutions.").

On Question, amendment agreed to. [Amendment No. 56 not moved.]
5 p. m.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 57:
Page 17, line 32, after ("may") insert (", with the consent of the Treasury,").
The noble and learned Lord said: My Lords, in moving this amendment I wish to speak also to Amendments Nos. 60, 226, 227 and 228. This group of amendments is intended to clarify our intentions with respect to how the new board will be funded. It has always been our intention that the board should be largely self-financing after an initial period when it may require the injection of relatively small amounts of public money to get it up and running. The board will charge fees to those whom it regulates and the fee revenue will be used to meet its running costs.
During our debate in Committee the noble and learned Lord, Lord McCluskey, referred to the self-financing nature of the Law Society of Scotland and called for the board to be established in a similar fashion. I indicated then that I was prepared to look again at the board's funding to see whether there was any way in which we could provide for finance of a more temporary nature so that the purposes of the board would not be put at risk but yet we could minimise any subsidy from public funds to the commercial activities of those regulated by the board.
I think that the amendments which we are now discussing will achieve this objective. It is now provided that any grant which the Secretary of State may make to the board —and I stress that his powers here are discretionary—may be made subject to specified terms and conditions which could include a requirement for repayment. The detailed arrangements for these grants would be contained in a financial memorandum from the Secretary of State to the board. The amendments also state that the fees raised by the board in connection with its regulatory functions may be applied towards repayment of any grant made by the Secretary of State. There is a further provision to put beyond doubt that the board could borrow money, for example by way of overdraft at the bank. Again the conditions for such borrowing would be laid down in the memorandum.
We have not made provision for the Secretary of State to make loans to the board. I do not think that such a provision is necessary since I believe we can achieve the desired outcome in the circumstances that I have explained by means of a repayable grant.
I indicated at the outset that in moving Amendment No. 57 I wished to speak also to Amendments Nos. 60, 226 and 227. The number for Amendment No. 60 has been omitted from the Marshalled List but I think its position in the Marshalled List is quite clear. I beg to move.
Lord Morton of Shuna: My Lords, this amendment goes some way towards meeting the difficulties I raised on the matter of level playing fields. However it does not go very far. Amendment No. 60 states that,
"Any grant… may be made subject to such terms".
This board is apparently to be set up to help the largest financial institutions which have the best resources in the world in a sense—in other words, the banks and the building societies. Why are those bodies in need of grants from the Government? The noble and learned Lord estimated that the cost of this board would be something like £ 100,000 to start off with.
I have been supplied with information from the Law Society of Scotland. That information contains calculations based on the rent for premises in central Edinburgh and on the accounts of the Scottish Legal Aid Board. The running costs of the proposed board have been calculated to be something over £350,000 a year. Why should this board, which is intended to facilitate the operations of banks and building societies, be provided with grants from the Government when the Law Society and perhaps various other bodies are not? It seems bizarre that the Government should decide that it is necessary to provide grants to banks and building societies of all people in order to enable them to do what the Government say they want them to do. Perhaps the banks and the building societies do not want to do what the Government wish. But surely that is a matter for the banks and the building societies. There is no need for grants to be provided.
In a sense it is difficult to speak to this amendment without mentioning my Amendment No. 58, which appears later on the Marshalled List. If we have to finance this board, it would be better to do so in the form of a loan rather than in the form of a nebulous power to recoup some money, as Amendment No. 60 implies.
Lord Macaulay of Bragar: My Lords, following on from what the noble and learned Lord, Lord Morton of Shuna, has just said, I must ask the noble and learned Lord the Lord Advocate what compulsion there will be on these major institutions as regards the terms and conditions for obtaining repayment to the public purse. The cost of getting the board up and running would be a drop in the ocean for those institutions, if that. These large institutions do not need public assistance. Your Lordships will recall that a heated debate took place in this House and in another place on another matter of loans. We are living in a funny country when young students are being forced into poverty and into debt by the very same Government who turn round to major financial and banking institutions and say, "Here is a little present from the Government to get you going". If the Government cannot do that for students, how can they justify handing out money to large companies which do not need one penny out of the public purse and which will benefit from the constitution of the board by being allowed into the public sector of these legal activities? That does not make any sense at all.
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The noble and learned Lord, Lord Morton, mentioned some large figures in connection with the board. However, the noble and learned Lord the Lord Advocate said that a considerable sum would not be needed to get the board up and running. The noble and learned Lord, Lord Morton, referred to the minimum figure that the Law Society of Scotland has arrived at. That figure was arrived at on the basis of rents for offices that were not even in the best areas of Edinburgh. The Law Society calculated that the cost per square foot of office accommodation was £23.50 and that the cost of a basic custom-built computer system was £140,000. The Law Society also calculated that the cost of fitting out and equipping offices was a further £100,000. Then there are staff to be paid, the chairman to be paid and the board members to be paid. The matter was reconsidered this morning and it was estimated that there might be no change out of £500,000. I am sure there are many students throughout the United Kingdom who would be delighted to obtain even £5 of that sum.
Baroness Carnegy of Lour: My Lords, the comparison that has been made between these proposals and student loans is not relevant. The only connection is that the student loans Bill concerns loans and the various speakers in the previous debate wanted to have loans in this case rather than grants. The point that we must not miss is that we are looking for some way of providing competition for solicitors in this field. Solicitors fund their own Law Society and the Law Society is making estimates as regards what such a body may cost. I do not know whether such a body would have to be situated in central Edinburgh. I should not have thought that that was necessary. Perhaps the estimates are unnecessarily large. But the point is that the Bill should permit arrangements to be drawn up in order to find out how the process works and to get the board up and running. Once it is up and running it may well be able to fund itself However, to say in legislation that it should be stopped before it starts by putting disincentives in the way of those who may dip their feet in the water for the first time seems to me a great mistake.
Lord Mackie of Benshie: My Lords, we appear to be talking about the next amendment, which I feel is the relevant amendment. I think it is quite reasonable to lend to banks and other wealthy institutions to enable them to get a start. They should be given loans at a proper rate of interest such as the rates of interest that they charge farmers in this country. That would be quite reasonable. However, the Government are wholly inconsistent in wanting to give banks money while taking money from farmers in order to fund essential research. It is wholly inconsistent and I suggest that we move to the next amendment so that the House can decide the matter.
Lord McCluskey: My Lords, despite what the noble Lord has just said, perhaps I may be permitted to say one word on the matter. I am not happy about the grouping either. I believe that Amendment No. 57 should have been taken on its own. However, the

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noble and learned Lord the Lord Advocate mentioned Amendment No. 60. He worried me by saying:
"it has always been our intention that the board should be largely self-financing".
That is the first time that the noble and learned Lord has said that. On a previous occasion, as I recall, he said that it was intended to provide moneys for the setting-up and starting costs but thereafter the board should be wholly self-financing. I hope that he will explain whether the use of the word "largely" represents a change of position or whether I have simply misunderstood him.
In a letter to me which he promised at Committee stage to write the noble and learned Lord said:
"As I made clear in the debate"—
and I must confess that he did not make it clear to me —
"the Board will in due course become self-financing and has been accorded a specific power to raise funds".
He went on to talk about pump priming:
"On the question of how best to provide the necessary 'pump-priming' finance before any fee income is forthcoming, the Secretary of State and I are currently considering whether it should be possible for such funding to be potentially available in the shape of loans, as well as by the means of direct grants".
So I do not know what the position of the Government is. No doubt we can explore that question in the course of dealing with the other matters.
However, there is one other matter of which I should perhaps give notice since Amendment No. 60 was spoken to by the noble and learned Lord. That is the curious notion of a grant which is subject to repayment. I know a good word to describe a grant which is subject to repayment: it is called a loan. In addition, the grants which are to be subject to repayment are to be subject to terms and conditions which may be varied after the grant is made. I notice that the noble Lord, Lord Sanderson, has decided to join us on this occasion. No doubt he has some knowledge of the Highlands and Islands Development Board lending sums of money, as will the noble Lord, Lord Mackie. However, I believe that there would be something of a hoo-ha if after the money had been received and spent the conditions for its repayment were then to be changed.
It may be that the noble and learned Lord the Lord Advocate has in mind a grant which is subject to certain conditions and if those conditions are not fulfilled the money may be clawed back, but I do not believe that that is what is said by Amendment No. 60. No doubt in due course we shall receive answers to those particular points. For the moment I should certainly not oppose Amendment No. 57.
Lord Fraser of Carmyllie: My Lords, perhaps I may reply briefly. I am sorry if the grouping is not considered satisfactory but I believe that there is at least some link between the two. As my noble friend Lady Carnegy mentioned, we appear to have ranged widely from the matter of setting up the board to the complaints of the farmers and students of Scotland.
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I should like to make it clear that the position remains that the Government envisage that the board will in due course be self-financing. I must make it clear that I am not prepared to see a situation whereby, by putting a number of restrictions around the board, those who wish to see the board's demise should achieve its demise because it is not properly funded. It should be appreciated that that is what appears to be behind the proposal.
I hope that noble Lords will read what I have had to say because I am not anxious to repeat it in detail. We envisage that grants from the Secretary of State might be made subject to such conditions that they should be essentially repayable. They are not quite the same as a loan but there might be circumstances which would mean that they were not repaid. I stress that it is the intention that the board should be of a self-financing character. However, I am not prepared to see arrangements introduced which, if adopted, might mean that the board could not get up and running without that priming at the outset.
The Earl of Selkirk: My Lords, I find it very difficult to follow what the noble and learned Lord has said. There is nothing whatsoever in the Bill about repayment. One is left with the proposition that government money may be provided to assist those competing with independent people on the same ground. I do not understand where the Director General of Fair Trading comes into the matter. This would be regarded as a very peculiar proceeding in the commercial market and it is a very odd proceeding here. I do not understand why it has been done.
Is the noble and learned Lord prepared to state in the Bill that repayment will be demanded in due course, because that does not appear in the Bill at all? If that is the intention it should be made abundantly clear.
5.15 p.m.
Lord Fraser of Carmyllie: My Lords, I should be grateful if the noble Earl would read what I said. I have already indicated that if the Secretary of State were to make any grant to the board—and he may not—his powers would be discretionary. The grant would be subject to specified terms and conditions which could include a requirement for repayment.
The Earl of Selkirk: My Lords, should that not be in the Bill?
On Question, amendment agreed to.
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 58.
Page 17, line 32, leave out ("grants") and insert ("loans").
The noble and learned Lord said: My Lords, in moving Amendment No. 58 I shall also speak to Amendment No. 59. Having heard what the noble and learned Lord the Lord Advocate said in the previous discussion I can do so fairly shortly because it appears clear that the Government will accept the amendment.
The purpose of the first amendment is to take out the word "grant" and insert the word "loans". I should make it clear that I am in no sense trying to

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prevent the board being set up. I wish to make sure that there is, in the hackneyed phrase, a level playing field and to specify very much the same type of finance as was insisted on for all the bodies which were set up under the Financial Services Act, namely that they should be self-financing.
If one converts Clause 14 (2) in the way in which Amendments Nos. 58 and 59 suggest, it would read:
"The Secretary of State may make loans to the Board towards expenses incurred, or to be incurred, by them in connection with the initial establishment of the Board".
From what the noble and learned Lord the Lord Advocate said that appears to be the Government's intention. If that is so no doubt he can indicate that the amendment is acceptable. If it is not the Government's intention to accept the amendment, why do we have to retain the words:
"the discharge by the Board of their functions"?
Why is it necessary for the grant to be made to this self-financing body—as we understand it is intended to be—for the discharge of its functions? That is illogical. It certainly does not create a level playing field if banks and building societies are to be subsidised in the discharge of their functions while the solicitors, who are their competitors, are to have no such subsidy. I beg to move.
The Deputy Speaker (Lord Nugent of Guildford): My Lords, I must point out to noble Lords that if this amendment is agreed to it pre-empts Amendment No. 60. Amendment No. 60 refers to grants and will therefore become supererogatory because "loans" will have taken the place of "grants".
Lord McCluskey: My Lords, I wish to support the amendment. Again one does not need to repeat the points which have already been made. However, the noble and learned Lord referred in a previous answer to those who wish to see the board's demise. I do not number myself among them, but I do not know who it was that he had in mind. It is an unfortunate term for him to use.
As I see it, the board is essential if others are to provide conveyancing and executry services as envisaged by the Bill. I do not think that the House is at the stage of saying that the clause should be deleted altogether. That matter has already been dealt with and this House would not attempt to stop the clause coming into force.
However, to return to the specific matter of grants and loans, it seems almost too clear for argument that the financial institutions and building societies referred to in the previous amendment simply do not need financial assistance from the taxpayer to set up a board to regulate their affairs any more than did the Law Society or the bodies which my noble and learned friend Lord Morton of Shuna mentioned. I should like to know in what circumstances the Government envisage that the board could not repay a loan. If the board is set up and governs the activities of building societies, banks and other financial institutions, in what circumstances could the Government forgo repayment of the sums of money?
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I am so puzzled by the Government's attitude in relation to the matter that I wonder whether they have thought through all the implications of what they currently say. Surely the proper answer is that the Government should be prepared, with the consent of the Treasury, to advance sums of money on commercial terms so that those bodies can be set up and in due course, out of their profits, can repay the Government's and the taxpayers' money.
Lord Stodart of Leaston: My Lords, as I understand it, the two noble and learned Lords have based a certain amount of argument on the fact that a sum of money that may have to be repaid is not a grant but a loan. There have certainly been grants in the field of rural housing. I have enjoyed them and have had to repay them. The noble and learned Lords would therefore say that they were not grants but loans. I do not know whether they were described as loans in the original legislation, but I do not think so. I have not researched the matter, so I do not know whether conditions were written into the legislation to the effect that they might have to be repaid. Certainly, the rural housing assistance scheme was known as rural housing grant, not rural housing loan, but in certain conditions it still had to be repaid.
Lord Macaulay of Bragar: My Lords, I shall not add much more to what I said in relation to the previous amendment, Amendment No. 57. However, I should like to know what negotiations have taken place with the representatives of those major institutions in relation to the primary funding of the board and whether there has been any indication from the banks and insurance companies that they cannot afford to get the board going at their own expense. Is there any reason why those institutions cannot get together, decide how much it will cost to get the thing going and collect the money together just as estate agents and solicitors get together if they want to open property centres? They bear the cost of the mutual exercise.
The noble Baroness, Lady Carnegy, suggested that some of us were here to protect the solicitors. We are certainly not here to do that. The system will run parallel with solicitors and there will be competition. The amendment is a matter of principle and concerns the difference between grants and loans in the circumstances which have already been discussed.
Baroness Carnegy of Lour: My Lords, I did not suggest that anyone was here to protect solicitors. I suggested that the point of the Bill was to present solicitors with some competition, which might be beneficial to the public. That is the point of the Bill. If solicitors were unregulated—just imagine the fantastic scene—and the government of the day considered it necessary to set up a law society and to persuade the profession to have a law society, it might well be that there would have to be a bit of inducement to persuade them. However, they have an excellent law society which they finance. The major institutions must be persuaded that the system can work. It may well be that some kind of negotiations must take place. We shall hear from my

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noble and learned friend, in response to the noble Lord, Lord Macaulay, whether he has anything to say about that matter. It may be that various conditions will apply in negotiations.
All we are discussing is a certain flexibility in the Bill in order to get the scheme going. No one can tell me that the people who object are doing anything more than objecting to the setting up of a board, in spite of what the noble and learned Lord, Lord McCluskey, said. If we are to have the system, we need the board, but he is not too keen on the system. The provision seems perfectly reasonable to me.
Lord Fraser of Carmyllie: My Lords, we are almost rattling around the Circle Line for a second time. I must tell noble and learned Lords who have contributed to the debate that it appears to me that what they are saying depends on making a number of assumptions which may well be right. It may well be that all the major banks in Scotland will immediately seek to become involved in conveyancing practitioner work. It may be that all the building societies and other financial institutions similarly wish to take advantage of that competitive opportunity.
However, a bank to which I spoke indicated that it did not want to do so and a building society has indicated to me that it does not wish to do so either. I do not think that they will change their minds. I have no idea how many institutions will wish to participate in the scheme. I can make no assumptions and I suggest to noble and learned Lords that similarly they can make no assumptions at the outset as to the number of institutions that may choose to participate.
My noble friend Lady Carnegy is correct in that respect. We seek to allow for provision whereby in the early days the Secretary of State can make repayable grants—not loans—to enable the scheme to be set up. However, I reiterate yet again: we intend that the board should be self-financing. If the assumptions which the noble and learned Lord, Lord McCluskey, made are correct—and he may well be correct—I am wholly confident that no subsidy of any kind will be necessary.
I do not think that the issue should generate the controversy which it appears to generate. We are trying to allow for a period at the start-up during which time the Secretary of State, by grants which are subject to conditions including that of repayment, will allow the scheme to get going. I do not mean the noble and learned Lord to get touchy about my suggestion that some people might be anxious to secure the demise of the board. If he excludes himself from that, I am more than happy to accept his assertion, but it is important that we should have that arrangement at this stage to enable the board to get going.
Rather than dealing with the matter by way of loans, as is suggested here, I have spelt out in some detail the way that the Secretary of State proposes to deal with it by way of repayable grants. Anyone who knows my right honourable friend the Secretary of State for Scotland will know that, if he is subjected to any attack in Scotland, as he occasionally is, it is
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because he is not free enough in making subsidies to institutions in Scotland, not because he is overly generous, as seems to be suggested here.
Lord Morton of Shuna: My Lords, it has been an interesting debate. The semantics of whether a repayable grant is a loan is perhaps worthy of discussion in an essay in the English language. However, that is not the point. The point is that Amendments Nos. 57 and 58 seek to make clear that the money to be provided by the Government is to be repayable and is only for setting up the board, not for the discharge by the board of its functions.
The noble Lord, Lord Stodart of Leaston, referred to agricultural grants. I am not sure what kind of grants he dealt with, but it is common to have a grant of that kind which one must repay if, for example, one sells the property. One gets a grant to repair a cottage or something, and it is only if the property is sold that the grant has to be repaid. It is a different kind of repayable grant to the one that we are talking about here.
I remain puzzled as to why, in the Financial Services Act, all these institutions that were to give financial advice were to be wholly self-financing as set up by the Act and under the framework of the Act. I do not know why we have to subsidise at the taxpayers' expense the banks and building societies who want to do conveyancing. It is an incredible puzzle.
The noble Baroness, Lady Carnegy, referred to the formation of the Law Society of Scotland. She is wrong. The society was formed at the insistence of the Government because they needed it for the Legal Aid Act. The Law Society of Scotland was financed not at all by the Government. It had to be totally self-financing in its set up. That has always been the position. So far as I am aware, we are setting up a unique new body which is to be financed partly by the taxpayer and which is to benefit the building societies and the banks.
That is totally wrong in comparison with the Financial Services Act and other circumstances. This measure does not provide what has been referred to as the level playing field. I regret that I have to ask for the opinion of the House.
5.32 p.m.
On Question, Whether the said amendment (No. 58) shall be agreed to?
Their Lordships divided: Contents, 75; Not-Contents, 95.

DIVISION NO. 1

CONTENTS

Addington, L.

Coleraine, L.

Ampthill, L.

Davies of Penrhys, L.

Ardwick, L.

Dean of Beswick, L.

Aylestone, L.

Dormand of Easington, L.

Blease, L.

Dunrossil, V.

Bottomley, L.

Ewart-Biggs, B.

Brightman, L.

Falkland, V.

Brooks of Tremorfa, L.

Fisher of Rednal, B.

Bruce of Donington, L.

Gallacher, L.

Carmichael of Kelvingrove,

Galpern, L.

L.

Gladwyn, L.

Cledwyn of Penrhos, L.

Glenamara, L.

195

Graham of Edmonton, L.

Morton of Shuna, L. [Teller.]

[Teller.]

Nicol, B.

Grantchester, L.

Northfield, L.

Gregson, L.

Oram, L.

Grey, E.

Phillips, B.

Hampton, L.

Pitt of Hampstead, L.

Hatch of Lusby, L.

Ponsonby of Shulbrede, L.

Hayter, L.

Prys-Davies, L.

Hirshfield, L.

Rea, L.

Howie of Troon, L.

Robson of Kiddington, B.

Hughes, L.

Rochester, L.

Hylton-Foster, B.

Russell, E.

Jenkins of Putney, L.

Saltoun of Abernethy, Ly.

John-Mackie, L.

Seear, B.

Kennet, L.

Selkirk, E.

Kirkhill, L.

Shannon, E.

Lloyd of Hampstead, L.

Stoddart of Swindon, L.

Longford, E.

Strabolgi, L.

Lovell-Davis, L.

Tordoff, L.

Macaulay of Bragar, L.

Turner of Camden, B.

McCluskey, L.

Underbill, L.

Mackie of Benshie, L.

Wallace of Coslany, L.

McNair, L.

Whaddon, L.

Mason of Barnsley, L.

White, B.

Milner of Leeds, L.

Williams of Elvel, L.

Molloy, L.

Winstanley, L.

Morris of Castle Morris, L.

NOT-CONTENTS

Abinger, L.

Kaberry of Adel, L.

Allenby of Megiddo, V.

Killearn, L.

Allerton, L.

Kimball, L.

Arran, E.

King of Wartnaby, L.

Ashbourne, L.

Lauderdale, E.

Auckland, L.

Layton, L.

Belhaven and Stenton, L.

Long, V. [Teller.]

Belstead, L.

Lucas of Chilworth, L.

Blatch, B.

Lyell, L.

Blyth, L.

McColl of Dulwich, L.

Borthwick, L.

Margadale, L.

Brookeborough, V.

Marshall of Leeds, L.

Buckinghamshire, E.

Merrivale, L.

Caithness, E.

Mersey, V.

Camegy of Lour, B.

Montagu of Beaulieu, L.

Carnock, L.

Morris, L.

Clanwilliam, E.

Mountevans, L.

Constantine of Stanmore, L.

Munster, E.

Cork and Orrery, E.

Murton of Lindisfarne, L.

Craigavon, V.

Nelson, E.

Craigmyle, L.

Norfolk, D.

Davidson, V. [Teller.]

Nugent of Guildford, L.

Denham, L.

Orkney, E.

Dundee, E.

Orr-Ewing, L.

Eden of Winton, L.

Park of Monmouth, B.

Elles, B.

Pender, L.

Elliot of Harwood, B.

Radnor, E.

Elliott of Morpeth, L.

Rankeillour, L.

FaithfuU, B.

Reay, L.

Fanshawe of Richmond, L.

Renton, L.

Ferrers, E.

Rodney, L.

Fortescue, E.

Sanderson of Bowden, L.

Eraser of Carmyllie, L.

Sharpies, B.

Gibson-Watt, L.

Somers, L.

Goold, L.

Stodart of Leaston, L.

Gray of Contin, L.

Strathclyde, L.

Greenway, L.

Strathmore and Kinghorne,

Grimston of Westbury, L.

E.

Harmar-Nicholls, L.

Sudeley, L.

Henley, L.

Swansea, L.

Hesketh, L.

Swinton, E.

Hives, L.

Thomas of Gwydir, L.

Holdemess, L.

Trefgarne, L.

Hooper, B.

Ullswater, V.

Howe, E.

Vaux of Harrowden, L.

Jenkin of Roding, L.

Westbury, L.

Johnston of Rockport, L.

Wynford, L.

Joseph, L.

Young, B.

Resolved in the negative, and amendment disagreed to accordingly.
5.40 p.m.
[Amendment No. 59 not moved.]
Lord Eraser of Carmyllie Lord Eraser of Carmyllie moved Amendment No. 60:
Page 17, line 35, at end insert —
("() Any grant made under subsection (2) above may be made subject to such terms and conditions (including conditions as to repayment) as the Secretary of State, with the consent of the Treasury, thinks fit and the Secretary of State may, with such consent, vary such terms and conditions after the grant is made.").
On Question, amendment agreed to.
Lord McCluskey Lord McCluskey moved Amendment No. 61:
Page 18, line 21, leave out ("may") and insert ("shall").
The noble and learned Lord said: My Lords, this is the first of a number of amendments which seek to achieve the same result; that is to remove the word "may" and replace it by the word "shall" in order to compel the Secretary of State to make regulations containing certain provisions.
I invite your Lordships' attention to Clause 15 (5) which states:
"The Secretary of State shall… by regulations make such provision as he considers appropriate as to the requirements to be satisfied by any person applying for registration under subsection (2) above, and such regulations may, in particular, require that the applicant maintains… suitable procedures for dealing with any complaints … suitable arrangements … to satisfy any successful claims made against it in connection with the provision of conveyancing services; and … suitable procedures for ensuring that the provision of conveyancing services by it complies with the regulations".
I believe that those requirements are necessary. The regulations would not be worth much if they did not contain provisions governing the requirement for suitable procedures, suitable arrangements and suitable procedures respectively as specified in subsection (5) (a), (b) and (c). In other words, there must be suitable procedures for dealing with complaints; suitable arrangements for dealing with successful claims against the new breed of paralegal practitioners; and suitable procedures as specified in subsection (5)(c).
The measure proposed in Amendment No. 61 would ensure that the regulations obtain appropriate provision. It would still give the Secretary of State a good deal of discretion by allowing him to determine what was appropriate in achieving those particular objectives. I remind the House that in Committee the noble and learned Lord the Lord Advocate said that he would reflect upon the matter. I do not see any evidence to show that the reflection has been productive of fruit but no doubt he will tell us. I beg to move.
Lord Eraser of Carmyllie: My Lords, I appreciate that the regulations made under the clause are of considerable interest not only to those in the existing legal profession but also to those who have a keen interest in protecting the consumer as regards the provision of new conveyancing services.
When we began our debates the clause contained two "mays". I conceded that one "may" should become "shall" and now another "shall" is demanded of me. I am anxious to indicate to noble

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Lords that if I were to accept the noble and learned Lord's amendments I should be going too far down the road of prejudging the content of the code before the Secretary of State had had time to consult fully on what it should contain, taking account of all the debates on the Bill here and in another place. I can, however, assure the House that the topics listed in subsections (5) and (11) will be covered in the code and I also make it absolutely clear that there will be consultations on the regulations before they are made.
As the noble Lord, Lord Macaulay, indicated, we shall shortly debate Amendment No. 66 about the parliamentary procedure to be attached to such regulations. I shall now comment briefly upon it. I accept the point that he accurately made. Comparable provisions are contained in a Bill promoted by my noble and learned friend the Lord Chancellor. The Bill provided that such regulations should be subject to the affirmative resolution procedure rather than the negative. That is a fair point. While I am not prepared to accept Amendment No. 66 there is a strong case for allowing north of the Border what is already provided for south of the Border. I do not say that lightly or in an attempt to put off matters. However, it appears that under the existing arrangement contained in the clause, particularly if there is attached the requirement that the regulations should be subject to affirmative resolution, the anxieties that have been expressed in various quarters are not as well founded as was feared.
I have reflected on the matter but not to the extent that the noble and learned Lord may have wished; namely, to introduce "shall" instead of "may". In Committee my noble friend Lord Renton asked whether, if "may" remained in the clause, the Secretary of State could be subjected to judicial review. My reflection on the matter is that yes, undoubtedly he could.
I hope that in those circumstances the noble and learned Lord will withdraw the amendments, particularly in the light of my comments on Amendment No. 66.
The Earl of Perth: My Lords, is my noble friend saying that he agrees that the provisions in subsection (5) (a), (b) and (c) will be included?
Lord Fraser of Carmyllie: My Lords, yes.
The Earl of Perth: My Lords, that is equivalent to "shall".
Lord Fraser of Carmyllie: My Lords, as I have said, I do not wish to prejudge too precisely the content of the code. That is a matter for the Secretary of State for Scotland. However if at that stage he considers that the contents of the code are insufficient —and it is important that we should have consultations—I shall look seriously at introducing the affirmative resolution procedure. That would appear to be consistent with the line taken by my noble and learned friend the Lord Chancellor in the Courts and Legal Services Bill.
Lord McCluskey: My Lords, I am content with the noble and learned Lord's reply and shall not seek to divide the House. He has said in terms that the topics contained in subsections (5) and (11) will be covered in the regulations. He has also indicated that the affirmative resolution procedure would be appropriate in that case. Therefore, if the Secretary of State were to omit them the House will have in mind those words. I trust implicitly and completely the Lord Advocate and the Secretary of State in relation to this matter and I am happy with the assurances that I have been offered. In those circumstances I beg leave to withdraw the amendment. I shall not move Amendment No. 62.
Amendment, by leave, withdrawn.
[Amendment No. 62 not moved]
Lord Morton of Shuna moved Amendment No. 63:
Page 19, line 18, at end insert ("including a requirement that conveyancing practitioners must offer each prospective conveyancing client an interview with a solicitor at a place convenient to that client, at which any possible conflict of interest will be reviewed and the scope of the service being provided explained.").
The noble and learned Lord said: My Lords, as is usual in these debates, the amendment reverts to a matter raised in Committee. It is the requirement that:
"conveyancing practitioners must offer each prospective conveyancing client an interview with a solicitor".
I recollect that there was general agreement that that should be done. I do not wish to take up the time of the House and I beg to move.
Lord McCluskey: My Lords, this amendment is also in my name. It is worthwhile emphasising that in Scottish law as well as in English law an agent has a duty to disclose to his principal all the benefits which he obtains from a transaction in which he acts as agent. He must account for any secret profits.
The purpose of this amendment and Amendment No. 65 is to ensure that these paralegals also make full disclosure of all such matters as may bear upon their interest in the transaction. The best that can be hoped for is that if full disclosure is made to the client or customer then that client or customer will be able to make his own judgment as to whether he should continue to be represented in the transaction by the person acting under this clause.
This is a matter of some importance and it received support in Committee from all quarters of the House. I hope that the Government will respond positively.
Lord Gray of Contin: My Lords, I like the wording of these amendments, particularly Amendment No. 63. I like the thought behind it that the opinion of a solicitor, who is after all an independent adviser, will be available.
There were two matters about this legislation which I disliked when we considered it earlier. As regards the first (the anxiety which I had for the future of solicitors in rural areas), my noble and learned friend has given me some consolation —if I may put it that way —by telling me that the Secretary

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of State will have another look at the situation and will have research carried out of which we shall all receive the benefit. If that research reveals that there is likely to be hardship, then the assumption is that the necessary action will be taken. It does not go quite so far as I should have liked, but it is at least recognition by the Secretary of State that the problem exists.
My second objection to the Bill is the whole question of what I see as the unhealthy—and I mean unhealthy for the consumer—relationship which is now developing and likely to develop further between building societies, banks, estate agents and insurance companies. It is on that point that I wish to relate my remarks on this amendment.
Most people require a mortgage to purchase a home. In the case of young couples—and sometimes not so young—borrowing involves a multiplier of three or even four times. For the benefit of the uninitiated, the multiplier is the number of times the borrower's gross annual salary which the lender regards as a safe level for loan purposes. Such borrowing involves severe repayment and interest pressures. In relation to the level of the multiplier, there is a very clear connection between that and the extent of the funds available to the lending institutions. With 100 per cent. loans and immediate interest charges, the old presumption that the property can always be sold to repay the amount borrowed has been breached. The surplus of funds for lending has led to many lenders paying commissions to intermediaries for placing loans with borrowers.
Lenders of their subsidiaries not only make profits from lending mortgages but also from ancillaries connected to those mortgages such as survey fees, building and contents policies and premiums, mortgage guarantee premiums—and most profitable of all, the sale of mortgage linked insurance products. Insurance companies pay commission to the intermediary who sells the policy to the investor. The amounts vary but in some cases over 60 per cent. of the first year or two years' premiums may be paid. Therefore it is only after two years that the policy acquires any investment value whatever to the purchaser. Investment insurance is inextricably linked to the house market and estate agencies. That is demonstrated clearly by the recent and continuing buying up of estate agencies by banks, building societies or insurance companies which see those agencies as the ideal sales point for their particular financial product.
Furthermore, that trend continues with banks and building societies becoming tied to particular insurance companies thereby not only avoiding the most arduous responsibilities associated with the Financial Services Act, including the need to disclose commission, but also obtaining higher commission levels which are paid through, although not by, the insurance company. The commission is deducted from the policy premium and is paid by the consumer.
Estate agents view their business today as not only to sell houses but in ever increasing numbers to sell mortgages and insurance related products. That means that they must act as buyer as well as seller;
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and given the substantial sums of commission involved, there is a great temptation to ensure that the buyer with their insurance product obtains the house.
In relation to mortgage linked policies, there has developed an appalling malpractice known as churning. That is the practice by unscrupulous financial advisers of persuading mortgagees to unnecessarily surrender existing endowment or other investment policies linked to mortgages when the mortgagee comes to increase or change the mortgage on a change of house. The adviser then sells a new mortgage for the full amount of the law loan thereby maximising the adviser's commission. The Law Society of Scotland estimates that as much as £70 million per year may be lost by the unnecessary surrender of life policies.
If this Bill is passed in its present form, it is quite obvious that in due course some lenders will offer to waive conveyancing charges altogether which will be done in-house. However, it will in effect be paid for by the purchaser—in other words, the consumer—through the huge commission which the lender is receiving through the sale of insurance-related accessories on behalf of that self same consumer.
One remedy might be the requirement that all commissions be made known to prospective clients in advance, and other associated loopholes can perhaps be remedied by appropriate amendments to the Financial Services Act. Not surprisingly, I fear deeply that the lack of independent advice, which may be the result of this legislation unless every care is taken, could leave the consumer in a very much less favourable position than presently exists.
The wording of this amendment involves the consultation with a solicitor and therefore maintaining the independent advice. I am afraid that I should become deeply suspicious not of the professional virtues of the solicitor who works for the building society, but of his general attitude in as much as he will be torn between two loyalties—his loyalty in offering the best possible advice to the client and his loyalty to the building society, bank or insurance company which pays his cheque. I do not believe that that is a healthy situation and is something which I find worrying.
In Scotland we have a proud record in relation to our solicitors. We have a conveyancing system which is comparable with that of any other country and is envied by many of them. I should not like to see that conveyancing system tainted by some of the practices which I have outlined this afternoon.
6 p.m.
Lord Macaulay of Bragar: My Lords, I should like to add my support to the spirit of Amendment No. 63. Other amendments are tabled along the same lines and the question of independent advice is central to the operation of the new conveyancing system.
The way in which the amendment has been phrased is perhaps a little narrow when dealing with conflicts of interest because that means different things to different people. Most people look upon it

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as a conflict between the buyer and the seller. However, I support the spirit of the amendment which is in keeping with what was proposed when the new conveyancers were introduced by the Bill.
Baroness Carnegy of Lour: My Lords, my noble and learned friend the Lord Advocate wrote to me because he observed that I had a great interest in this subject. He explained that the regulations to which the noble and learned Lord, Lord McCluskey, referred will require practitioners to offer all potential clients an interview before any instructions are accepted. The idea is that that provision should be contained in regulation rather than on the face of the Bill.
I heard from the bodies representing consumers that they are very pleased with the amendments being accepted by the Government on various aspects of the Bill and are pleased with the progress on this matter. There is one important aspect of the amendment which I should like my noble and learned friend on the Front Bench to confirm. It is not only important that there should be a free interview, but that it should be held at a place convenient to the client. There is no point in holding an interview somewhere where the client finds it difficult to attend. That needs to be made plain, if not in the Bill then in the regulations. Perhaps that point could be confirmed.
My noble friend Lord Gray of Contin spoke at length on matters discussed at an earlier stage and certainly threw additional light upon them. He spoke partly about the process known as "churning", in which I too have taken an interest. The interview is extremely important. My noble and learned friend the Lord Advocate explained that it will be free in the sense that if the client decides not to proceed with that particular practitioner, there will be nothing to pay for the interview. As several noble Lords mentioned in Committee, the cost will have to be added to the fees charged for interviews. The people who are paying fees will pay for the interviews which were free to the people who did not take up the arrangement with that particular practitioner.
I hope that the point on the place of the interview being convenient to the client will be incorporated in the regulations whether or not the amendment is accepted.
Lord Coleraine: My Lords, I support the amendment. I anticipate that my noble and learned friend will say, as was said during the passage of the English Bill, that these matters are better dealt with by regulation than on the face of the Bill. If that is so, I have taken careful note of the comments of the noble Lord, Lord Macaulay of Bragar. It seems to me that my noble and learned friend should say that any interview envisaged between the conveyancing practitioner and the client or customer should clearly include provision for the conveyancing practitioner to outline potential conflict of interest not just between vendor and purchaser, but between the conveyancing practitioner and the client or customer.
Lord Fraser of Carmyllie: My Lords, this has been an interesting debate on what is undoubtedly an important part of the Bill. Perhaps I can deal first with a number of matters raised by my noble friend Lord Gray of Contin before turning to the specific provisions of the amendment.
The noble Lord, Lord Gray, raised a number of issues which are of concern both to those who provide the services and to those with a consumer interest in mind. What emerged clearly from the examples and estimates of calculations that he gave was that many of the problems he envisages for the future are problems which exist at present. I suggest that we need to tackle the issue of the provision of financial services not exclusively in relation to the conveyancing regime, but as the Securities and Investments Board are doing at the moment, reviewing the rules that apply to all who provide financial services. Ministers of the Department of Trade and Industry recently stated their clear intention to tighten up elements of malpractice by estate agents which have been identified; but those exist at present, not just in relation to what might be provided for under the Bill.
The noble Lord also made the point regarding "churning". That was taken up by my noble friend Lady Carnegy. That is a matter better dealt with in the broader context of financial services. Perhaps I can say that one matter appears to have been overlooked as we consider this part of the Bill. It is that the tying-in of financial services to conveyancing is prohibited for the whole of Great Britain in the Courts and Legal Services Bill. The reason it appeared in that provision is because it is possible that those who might be offering the financial services could be on this side of the Border rather than in Scotland. In any event, the tying-in prohibition is there for the whole of Great Britain.
Turning to the specific amendments, as I said at Committee, I have no difficulty in accepting that the matters which these amendments seek to import into the statutory code of conduct for conveyancing practitioners are important features of our proposed scheme. The draft conveyancing code which was set out in the Secretary of State's consultation paper, The Legal Profession in Scotland, and the further suggestions made in the statement, The Scottish Legal Profession: the Way Forward, deal in terms with all the points. Where I part company with what is suggested is that it is desirable to include such detail in the list of items which guide the Secretary of State in framing the regulations. Various suggestions can readily be accommodated within the list of items we have. The requirement to offer an interview with prospective clients would be part of what is Clause 11; the manner in which conveyancing practitioners conduct the provision of conveyancing services.
Perhaps I could say to my noble friend Lady Carnegy that we will be consulting on what will be the contents of the conveyancing code, but it is certainly the intention that the location should be convenient to the prospective client. I should not like to tie it down absolutely by saying that it has to be at his home. If, for example, in a part of the country which she knows someone who worked in Dundee wished to purchase a house in the rural

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areas of Angus, it may be convenient for that person to see a conveyancing practitioner in Dundee. What is important is that we should focus on the idea that it is a point of meeting convenient to the client to whom the services may be offered.
I am grateful to my noble friend for underlining what I said with regard to that interview—that it should be free. It will be free in the sense that if the services are not taken up, the prospective client will not have to pay. But somehow, of course, someone will have to pay. We cannot fashion interviews in the time of professional men out of nothing.
Turning to conflicts of interests, as your Lordships will be aware it is spelt out in the simplest of terms that under subsection (11)(c) conflicts of interest are to be covered by the code. It seems to me important that conflicts of interest stated in that broad fashion should be allowed to stay on the face of the Bill. However, I confirm that specific prohibitions on acting for specific combinations of parties whose interests conflict are envisaged as being contained in the code. It is a difficult issue. There may well be circumstances in which purchaser and seller wish one person to act for them both. It might appear to be an unnecessary restriction if that possibility were to be excluded in all circumstances. I suggest that we leave that to consultation and the code of conduct.
I can assure the House that the matters referred to in these amendments will all feature in appropriate terms in the regulations issued for consultation. There could be no end to the detailed list of items for inclusion in the code. Indeed, the draftsman would be concerned. The more items that are suggested, the less scope there is for measured reflection on what is important as distinct from how that importance is expressed. We would not wish to restrict conflicts of interest too much in case such a step curbed what the Secretary of State can do.
With the clear appreciation that these matters are important and should be contained in the code of conduct but not on the face of the Bill, I hope the amendment can be withdrawn.
Lord Morton of Shuna: My Lords, it is always difficult to work out what should be on the face of the Bill. I agree with the noble Baroness, Lady Carnegy, that this is a crucial item and it is difficult to see why it is not in the Bill. It does not add very much to the length of the Bill which seems in any case to get longer as it proceeds through this House.
I am aware that the grouping suggests that Amendment No. 63 should be debated with Amendment No. 65. I deliberately spoke only to Amendment No. 63 because it appeared to me that the grouping was not particularly useful. I am sorry if that was not clear. Therefore, I shall speak separately to Amendment No. 65. Perhaps others will also do so. However, at this stage I ask leave to withdraw Amendment No. 63 more in disappointment than appreciation.
Amendment, by leave, withdrawn.
Lord Macaulay of Bragar Lord Macaulay of Bragar had given notice of his intention to move Amendment No. 64:
Page 19, line 18, at end insert ("including, in particular, provisions for a reasonable opportunity for customer interviews and regular communication").
The noble Lord said: My Lords, I listened to what the noble and learned Lord the Lord Advocate said in relation to Amendment No. 63. It is clear from the points made in support of Amendment No. 64, which is associated with Amendment No. 68—I believe these came from the citizens advice bureaux—that the Lord Advocate has in mind the review of the matters contained in these amendments. In the circumstances, and particularly in the light of the partial concession made in relation to Amendment No. 66, we shall await with interest what comes out at the end of the day.
Lord McCluskey: My Lords, before the noble Lord sits down, does he intend to move the amendment?
Lord Macaulay of Bragar: My Lords, I do not intend to move it.
The Deputy Speaker (Lord Hayter): My Lords, is the noble Lord moving the amendment?
Lord Macaulay of Bragar: My Lords, it is not moved.
[Amendment No. 64 not moved.]
6.15 p.m.
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 65:
Page 19, line 22, at end insert ("including, in particular, provisions restricting practitioners from providing their services both to the owner of any property and to the purchaser or prospective purchaser of that property;").
The noble and learned Lord said: My Lords, the amendment covers a slightly different but crucial issue. There should be provision that no person can act for, or provide services to, both the owner of a property and the purchaser or prospective purchaser of a property. This is obviously a matter that has to be dealt with. It is included in the list of matters to be considered in the regulations. I accept that the regulations may allow for the exceptions one would expect; for example, a parent conveying his house to a child, or something of that nature. That would be excluded from the regulations.
However, I suggest that it is necessary that there should be a prohibition from acting for both sides put on the face of the Bill in the sense that it has to be in the regulations. This simple but crucial point must be dealt with.
I emphasise that the wording of the amendment refers to services in general so that it covers rather more than merely providing the conveyancing. It provides for various other services such as insurance, and so on. It is an important amendment which I hope will be acceptable to the Government. I beg to move.
Lord McCluskey: My Lords, the noble and learned Lord, Lord Morton of Shuna, and I owe an apology to the Deputy Speaker, the noble Lord, Lord Hayter, and others who have occupied the Woolsack, because many of these amendments have been tabled in both our names. My name has appeared first, followed by that of the noble and learned Lord, Lord Morton, who has risen to his feet first. Both of us have had

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judicial duties today and it was uncertain whether both of us could be here. To the delight, I am sure of the noble and learned Lord the Lord Advocate both of us have managed to be present.
In supporting this amendment I simply refer back to what the Lord Advocate said. He said that this type of provision would feature in the regulations. Again, if I am right in thinking that the affirmative resolution procedure is contemplated for these regulations I am sure that the House is happy to have that assurance. That gives a sound basis for criticising the Secretary of State in the unlikely event that that undertaking is not honoured.
I draw attention to one word which the noble and learned Lord the Lord Advocate used a few moments ago. I refer to the word "restricting" which I consider to be important. I do not envisage that one should prohibit altogether the possibility of a solicitor or conveyancer who is not a solicitor acting for both parties. I can envisage circumstances in which persons fully aware of what is happening are prepared to trust the solicitor or other conveyancer to act for both sides. I believe I mentioned that in Committee. This amendment would allow representations to be made to the Secretary of State on what the restrictions should be rather than move towards total prohibition. For those reasons I support the amendment.
Lord Fraser of Carmyllie: My Lords, bearing in mind the grouping of these amendments I believe I have already made my views clear. However, perhaps I may tell the noble and learned Lord, Lord Morton, that it was precisely his observation that there might be perfectly reasonable circumstances where there is nothing wrong in one solicitor or conveyancing practitioner acting for both sides that underlined my concern about writing such a matter on to the face of the Bill. I repeat, I consider that clearly there are circumstances which should be spelt out in which there would be an unacceptable conflict of interests if a conveyancing practitioner were to act for both parties.
The simplest way in which I can underline my concern is in relation to the present conflicts of interests rules of the Law Society which were introduced in recent years. As I understand those rules, there are no fewer than six specific exceptions to the general rule that one should not act for both parties. If there are six specific exceptions—perhaps six is too many; maybe there should be only four and we should be restricting the code of practitioners to another number—and if we are referring to numbers of that sort it would seem to be appropriate to leave the Bill as it stands whereby conflicts of interest are to be dealt with on the clear undertaking that the Secretary of State recognises the concern. As I further indicated, such matters are likely to be subject to the affirmative resolution procedure.
Baroness Carnegy of Lour: My Lords, before my noble friend sits down, may I ask whether he recollects that at Committee stage I moved an amendment suggesting that the provisions in these regulations should be incorporated into the rules of
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the Law Society? That was not accepted by the Government or by the House. We did not take it to a vote. If the amendment were taken to a vote and carried, would be consider that matter again? We seem to be asking something that is not required of solicitors. As the noble and learned Lord has just said, that would not be a level playing field in the other direction.
Lord Fraser of Carmyllie: My Lords, perhaps I may comment briefly on that. The issue would emerge in this way. If after consultation some representation was made that the list of exceptions as applied to conveyancing practitioners was to be shorter or indeed longer than that applied to the Law Society, one would have to consider very carefully what the exceptional circumstances were that brought about the difference. I envisage that my right honourable friend the Secretary of State for Scotland would take as his starting point on conflict rules the rule which applies to the Law Society of Scotland. That does not bind him in any sense to provide for that in the regulations.
However, as my noble friend has said, it would seem appropriate in these circumstances that any rules that are applied, and any exceptions to rules, should relate equally to solicitors and conveyancing practitioners.
Lord Morton of Shuna: My Lords, I shall not press the amendment to a vote. However, I should have thought that the amendment is restricting practitioners and is not a prohibition. Some of the comments of the noble and learned Lord the Lord Advocate may have been made on the basis that the amendment contained a prohibition. It does not. I agree wholeheartedly with the noble Baroness, Lady Carnegy, that the restrictions should be the same for the Law Society as for the conveyancing practitioner. Perhaps I would go further than she would—we usually agree on this matter—by saying that the restrictions should be tighter than has the Law Society at present. With that expression of a purely personal view, I beg leave to withdraw Amendment No. 65.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey moved Amendment No. 66:
Page 19, line 37, leave out ("subject to annulment in pursuance of a resolution of either House of Parliament.") and insert:
("(2) No instrument shall be made under this section unless a draft of the instrument has been approved by resolution of both Houses of Parliament.").
The noble and learned Lord said: My Lords, I shall deal with the amendment briefly, although it is an important matter. The House understands that what is being introduced is an entirely new system in relation to conveyancing and executry services. No one has any clear idea how it will work although many people have expectations or fears. There have been no pilot studies. There is no parallel that we can look at in England. The consultation before the Bill was relatively minimal and did not appear to me to be very effective although certainly there have been considerable improvements since the Bill was read a second time in this House.
Finally, the content of the regulations is rather imprecise. The noble and learned Lord the Lord Advocate has satisfied many of us by indicating what the contents will be. In those circumstances, given what he said earlier, I hope that he will be able to accept the amendment and to allow the affirmative resolution procedure in relation to those instruments. I beg to move.
Lord Fraser of Carmyllie: My Lords, having given those previous indications, I hope that I too can deal with the amendment briefly. In view of what has happened in the Courts and Legal Services Bill, as has been fairly pointed out by the noble Lord, Lord Macaulay, it would appear to me appropriate that these regulations ought to be subject to affirmative resolution. I give that undertaking that that should be the case. However, I am not prepared to accept the amendment as it stands, on the undertaking that it will be brought forward in another place.
The noble Lord, Lord Macaulay, raised a further matter: that provisions in relation to executry services are subject to negative resolution. I do not go so far in relation to those provisions at the present time. However, I appreciate the point that he has made: that if these matters are subject to affirmative resolution, there is a case for subjecting provisions in relation to executry services also to affirmative resolution.
Lord McCluskey: My Lords, in the light of what has been said, I see no need to press the amendment. I beg leave to withdraw it.
Amendment, by leave, withdrawn.
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 67:
Page 19, line 47, at end insert ("and to imprisonment for a period not exceeding one month").
The noble and learned Lord said: My Lords, in moving the amendment, I speak also to Amendments Nos. 73, 74, 99 and 100. I can put the purpose of the amendments very briefly. It is to create a level playing field for the imposition of penalties upon solicitors and practitioners who offend. I beg to move.
Lord Fraser of Carmyllie: My Lords, I am aware of the comparable provisions that apply to solicitors in Scotland which admit the possibility of imprisonment; and the arguments about the level playing field. I am not convinced that the quality of treatment would necessarily require the use of the Scottish solicitors' model. The parallel provisions for English solicitors and licensed conveyancers provide only for fines. I intend to bring forward an amendment on Thursday which will remove the penalty for imprisonment for offences under the Solicitors Act. I can do so in view of the schedules attached to the Bill. It is a more sensible step that preserves that legendary level playing field. In those circumstances, I invite the noble and learned Lord to withdraw the amendment.
Lord Morton of Shuna: My Lords, certainly. I beg leave to withdraw the amendment. It seems a very satisfactory solution.
Amendment, by leave, withdrawn.
[Amendment No. 68 not moved.]
Lord Macaulay of Bragar Lord Macaulay of Bragar moved Amendment No. 69:
After Clause 15, insert the following new clause:
("Beneficial interest of practitioners
It shall not be lawful for any conveyancing practitioner, or solicitor, or any employee or associate of a conveyancing practitioner or solicitor, to have any beneficial interest in any transaction relating to heritable property other than by way of fees from the client. ".
The noble Lord said: My Lords, the provision refers back to the discussion that began at Amendment No. 63. It is another aspect of the regulations that apply to the conveyancing practitioner. It ensures that solicitors and other conveyancers have only their clients' interests at heart. In view of the discussions that we have had, I do not propose to take up the time of the House in going over the ground again.
I do not withdraw the amendment at this stage because it is linked with Amendments Nos. 72, 97, 98 and 102 which deal with the contravention by anyone of the rules of conveyancing practice. Those are very important matters.
At page 21, line 20, the Bill states that:
"Any person who—

(a) wilfully and falsely —

(i) pretends to be a qualified conveyancer; or

(ii) takes or uses any name, title, addition or description implying that he is a qualified conveyancer; or

(b) being a qualified conveyancer, provides conveyancing services at a time when his registration as such is suspended,

shall be guilty of an offence and liable on summary conviction to a fine not exceeding level 4 on the standard scale".
The subsequent amendment seeks to make provision for proceedings on indictment. The view is taken that anyone who indulges in these activities should not be dealt with at summary level. It has to be spelt out in the Act that to behave in the way suggested in that paragraph is a serious matter, and that the courts and prosecution will take a serious line on such activities. I beg to move.
6.30 p.m.
Lord Fraser of Carmyllie: My Lords, I must ask the House to resist the amendments. They would have the effect of paralysing the Government's intention that providers should be able to offer conveyancing services and undertake confirmation work for their clients. Our policy is to increase choice, and one way in which we wish to do this is by allowing financial institutions to provide a straight through service to clients in house purchase and executry services. We do not pretend that the services will be identical to those offered by solicitors, although the amendments will also severely restrict the capacity of solicitors to earn income from services related to conveyancing.

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Of course independent financial advice will not be available to the client who chooses to obtain a mortgage and have conveyancing done by a building society, We are however committed to a whole range of measures which will allow the client to make an informed choice of legal adviser. It will be a requirement of the code of practice that the conveyancing practitioner makes clear to the prospective client that independent financial advice is not available about particular financial products and, at the same time, the adviser will be bound by the terms of the Financial Services Act to give best advice to the client. This will extend, for example, to advising on particular types of house purchase finance as distinct from particular products. Failure to comply with the code will be a disciplinary offence subject to investigation and disposal by the board. The powers of the board will extend to revoking the right to practice.
We have therefore made provision for clients to be informed about the nature of the services being offered by conveyancing practitioners who are also financial institutions. In pursuing the policy, which we believe is right for clients to give them greater freedom of choice, we cannot place restrictions in the way of financial institutions which would prevent them providing a straight through service to clients. With that explanation, I hope that the noble Lord will feel able to withdraw the amendment.
Lord Macaulay of Bragar: My Lords, I am grateful to the noble and learned Lord for that explanation. As with all other new legislation, only time will tell whether the regulations will have the effect on the practices of conveyancing practitioners, and so on, that it is hoped they will have. In the light of the explanation, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 16 [Qualified conveyancers]:
Lord McCluskey Lord McCluskey moved Amendment No. 70:
Page 2 1, line 2, after ("required") insert ("either").
The noble and learned Lord said: My Lords, in moving the amendment, I shall speak at the same time to Amendment No. 71. As noble Lords will see, Clause 16 (10) as it is worded implies that the recording and registration of deeds are cumulative steps. In fact they are alternative methods of dealing with deeds. Accordingly, a warrant is required either for a recording or for a registration. The amendments simply reword the provision in order to make that clear. I beg to move.
Lord Fraser of Carmyllie: My Lords, I admire the confidence with which the noble and learned Lord addressed the two amendments on the difficult issue of the registration of deeds in the Registers of Scotland.
While I understand the purpose of this amendment, I have to say that statutory authority is not required in order to register deeds in the Books of Council and Session alone. The amendments are therefore unnecessary in this respect. On that basis I would therefore invite the noble and learned Lord
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to withdraw the amendments. There is however a technical point which has arisen in relation to the existing terms of Clause 16 (10) (a) in so far as it relates to dual registration of a deed —registration in both the General Register of Sasines and in the Books of Council and Session. The point will be pursued with the Keeper of the Registers of Scotland, and I undertake to bring forward at a later stage any amendment necessary to place a qualified conveyancer in the same position as a solicitor regarding registration of deeds. I hope that that is entirely clear to the noble and learned Lord.
Lord McCluskey: My Lords, the noble and learned Lord the Lord Advocate has recognised the shallowness of my learning in these matters. Nonetheless, I understood what he said. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment Nos. 71 to 74 not moved.]
Clause 17 [Confirmation practitioners]:
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 75:
Page 21, line 30, leave out ("confirmation") and insert ("executry").
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 76:
Page 21, line 33, leave out from ("applicant") to end of line 38 and insert ("fulfils the conditions specified in subsection (2A) below,").
The noble and learned Lord said: My Lords, I spoke to this amendment with Amendment No. 54. I beg to move.
On Question, amendment agreed to.
[Amendments Nos. 77 and 78 not moved.]
Lord Fraser Lord Fraser of Carmyllie moved Amendment No. 79:
Page 21, line 40, leave out ("confirmation") and insert ("executry").
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendments Nos. 80 to 85:
Page 21, line 40, at end insert:
("(2A) The conditions referred to in subsection (2) above are that the applicant —

(a) is a fit and proper person to provide executry services;

(b) complies with the requirements prescribed by regulations made under subsection (10) below; and

(c) maintains suitable arrangements (whether by means of insurance policies or otherwise) to satisfy any successful claims made against it in connection with the provision of executry services.")

Page 21, leave out from beginning of line 44 to end of line 7 on page 22
Page 22, line 22, leave out ("a confirmation") and insert ("an executry")
line 29, leave out ("confirmation") and insert ("executry")
line 31, leave out ("confirmation") and insert ("executry")
leave out lines 32 to 43 and insert—
("(10) The Secretary of State shall, subject to section 32 of this Act and after consultation with such persons as he considers

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appropriate, by regulations make such provision as he thinks fit with a view to maintaining appropriate standards of conduct and practice of executry practitioners and such regulations may, in particular, make provision as to educational qualifications and practical training.
(11) Regulations under subsection (10) above shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.")
The noble and learned Lord said: My Lords, I spoke to Amendments Nos. 80 to 85 with Amendment No. 54. I beg to move.
On Question, amendments agreed to.
Lord Macaulay of Bragar Lord Macaulay of Bragar had given notice of his intention to move Amendment No. 86:
Page 22, line 32, leave out ("may") and insert ("shall").
The noble Lord said: My Lords, we have already been through the "may" and "shall" argument. The House will see that subsection (10) reads:
"The Board may, subject to subsection (11) below, make rules with a view to the maintenance of appropriate standards of conduct and practice of confirmation practitioners".
The noble and learned Lord, Lord McCluskey, has already given his views on "may" and "shall". I adopt those arguments in relation to this matter. If the board is to be given power to make the rules with a view to maintaining appropriate standards of conduct and practice, that should be made compulsory within the framework of the Bill. It should not be left to the board itself perhaps to make up its mind to do or not to do something.
The Deputy Speaker: My Lords, I apologise to the noble Lord. I should have said that if the House agreed to Amendment No. 85, which it has done, I could not call Amendment No. 86.
[Amendment No. 86 not moved.]
[Amendments Nos. 87 and 88 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendments Nos. 89 to 96:
Page 22, line 46, leave out ("a confirmation") and insert ("an executry").
Page 22, line 47, leave out ("confirmation") and insert ("executry").
Page 23, line 2, leave out ("a confirmation") and insert ("an executry").
Page 23, line 3, leave out ("rules") and insert ("regulations").
Page 23, line 8, leave out ("a confirmation") and insert ("an executry").
Page 23, line 10, leave out ("a confirmation") and insert ("an executry").
Page 23, line 11, leave out ("a confirmation") and insert ("an executry").
Page 23, line 11, leave out second ("confirmation") and insert ("executry").
The noble and learned Lord said: My Lords, I spoke to Amendments Nos. 89 to 96 with Amendment No. 54. I beg to move.
On Question, amendments agreed to.
[Amendments Nos. 97 and 98 not moved.]
Lord McCluskey Lord McCluskey moved Amendment No. 99:
Page 23, line 14, at end insert ("and to imprisonment for a period not exceeding one month.
(12) Where an offence under this section has been committed by a body corporate and it is proved to have been committed
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with the consent or connivance of or attributable to neglect on the part of any director, manager, secretary or other similar officer of the body corporate, or any person purporting to act in any such capacity he as well as the body corporate shall be guilty of the offence and liable on summary conviction to the same penalties.").
The noble and learned Lord said: My Lords, the amendment repeats the point about imprisonment for a period not exceeding one month. I do not intend to repeat any submission in relation to that. However, it also contains a proposed new subsection (12) which deals with offences by bodies corporate and makes the officers in certain circumstances liable to prosecution also.
This is a usual type of provision to find in a statute creating offences capable of being committed by a body corporate. Responsibility should, if possible, be personal. Officials of a company—the guiding hand of the company as it were—should not be able to shuffle off that responsibility by getting the company to pay a fine. It ties in to some extent with the imprisonment proposal but it can survive without it. In these circumstances, I ask that the Government should explain their position in this relation, and I beg to move.
Lord Fraser of Carmyllie: My Lords, I shall have to look at this. I understood that what was being put forward was in the context of the imprisonment provision. That may be a misunderstanding on my part of what was being proposed. I thought that it had been covered by what I said in relation to Amendment 67. I shall have to come back to the noble and learned Lord on this.
Lord McCluskey: My Lords, I do not want to take up time by developing this argument. There is a slightly different point. There may be circumstances in which it is appropriate to bring the individual to court even if it is not a question of imprisonment. Sometimes the moral opprobrium is worth directing against a person who has been guilty of some particularly reprehensible act. However, in the circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Macaulay of Bragar Lord Macaulay of Bragar moved Amendment No. 100:
Page 23, line 14, at end insert ("or on conviction on indictment to a fine or to imprisonment for a period not exceeding two years or to both such imprisonment and fine.").
The noble Lord said: My Lords, this is a probing amendment to obtain the Government's views on the question of taking proceedings on indictment. As was mentioned on more than one occasion, we seem to be limiting the punishment to summary procedure, and in the context of this amendment, although it could apply to others as well, we should like to know whether the Government are ruling out using solemn procedure in relation to offences in this section of the Bill. I beg to move.
Lord Fraser of Carmyllie: My Lords, in debating Amendment No. 67 I thought that we were covering Amendment No. 100. I indicated that on Thursday

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I shall be bringing forward an amendment that deals with the imprisonment point. I suggest that this matter might be left until we discuss that.
Lord Macauiay of Bragar: My Lords, in those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 101:
After Clause 17, insert the following new clause:
{"Executry services by recognised financial institutions

.—(1) A recognised financial institution may provide executry services if it has notified the Board that—

(a) it intends to do so; and

(b) it is a member of, or otherwise subject to, a scheme which —

(i) has been established (whether or not exclusively) for the purpose of dealing with complaints about the provision of executry services; and

(ii) complies with such requirements as may be prescribed by regulations made by the Secretary of State with respect to matters relating to such complaints.

(2) In this section "recognised financial institution" means any institution which is —

(a) an institution authorised by the Bank of England to operate a deposit-taking business under Part I of the Banking Act 1987;

(b) a building society authorised to raise money from its members by the Building Societies Commission under section 9 of the Building Societies Act 1986;

(c) a body authorised to carry on insurance business under section 3 or 4 of the Insurance Companies Act 1982; or

(d) any subsidiary (as defined by section 736 (1) of the Companies Act 1985) of a body falling within paragraph (a), (b) or (c) above whose business, or any part of whose business, consists of the provision of executry services.

(3) The Board shall maintain a list of recognised financial institutions which have given notice under subsection (1) above and shall make the list available to any person without charge.

(4) The Board shall, as soon as practicable after 1st April in each year, send a copy of the list maintained under subsection (3) above to each sheriff clerk.

(5) Regulations under subsection (1) above shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.").

The noble and learned Lord said: My Lords, I have already spoken to this in relation to Amendment No. 54. I beg to move.
On Question, amendment agreed to.
Lord Macaulay of Bragar Lord Macaulay of Bragar moved Amendment No. 102:
After Clause 17, insert the following new clause:
("Beneficial interest in funds invested etc.
No confirmation practitioner or solicitor shall have any beneficial interest, directly or indirectly, in the investment or deposit of—

(a) executry or trust funds; or

(b) funds which, immediately before any investment or deposit, were transferred to a beneficiary from an executry or trust under the control of the practitioner or solicitor, unless the beneficiary was a client or customer of the practitioner or solicitor before instructions to obtain confirmation were received.").

The noble Lord said: My Lords, this is another mirror of the previous amendment that we discussed. This relates to beneficial interest in funds invested. It is directed towards preventing the practitioner,
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or solicitor, having any beneficial interest either directly or indirectly in the deposit of the executry or trust funds, or where people have become beneficiaries in putting the money under the control of the practitioner or solicitor unless the beneficiary agrees. It is a protection to the client and to the fund which is sought to be brought in by Amendment 102. I beg to move.
Lord Fraser of Carmyllie: My Lords, looking at the groupings I had understood that we were discussing this amendment along with Amendment No. 69, which was subsequently withdrawn. In any event I do not think that I have anything to add to what I said in relation to Amendment 69.
Lord Macaulay of Bragar: My Lords, in the light of that explanation, short as it is, I shall look back at what was said in relation to Amendment 69. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 18 [Professional misconduct, inadequate professional services, etc.]:
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 103:
Page 23, line 17, leave out ("a confirmation") and insert ("an executry").
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 104:
Page 23, line 21, leave out ("rules made under section").
The noble and learned Lord said: My Lords, I spoke to this in relation to Amendment 54. I beg to move.
On Question, amendment agreed to.
6.45 p.m.
Lord McCluskey Lord McCluskey moved Amendment No. 105:
Page 24, line 23, at end insert:
("(5A) The Secretary of State may by order made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament amend subsection (3) (e) or (4) (b) above by substituting another sum for the sum of money for the time being specified in that provision.").
The noble and learned Lord said: My Lords, in Clause 18 (3) (e) and (4) (b) fines are described as,
"a fine not exceeding £10,000".
The purpose of this amendment is simply to allow that sum to be altered without the need to return to the House for primary legislation. Accordingly it is proposed that an order may be made by the Secretary of State, (and it is quite sufficient for this purpose that it be subject to a negative resolution procedure) to allow that sum to be changed. It simply introduces some flexibility. I beg to move.
Lord Fraser of Carmyllie: My Lords, the only comment I have to make on this amendment is that following shortly I have Amendment No. 108, which I consider in a slightly improved fashion covers the same point. I think that the point at issue is precisely the same, and on that basis I would invite the noble and learned Lord to withdraw this amendment.
Lord McCluskey: My Lords, I will accept that invitation, and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 106:
Page 24. line 42. leave out ("confirmation") and insert ("executry").
The noble and learned Lord said: My Lords, I spoke to this in relation to Amendment 54. I beg to move.
On Question, amendment agreed to.
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 107:
Page 24, line 45, at end insert:
("(a) where a practitioner or qualified conveyancer is found guilty of professional misconduct or of providing an inadequate professional service and").
The noble and learned Lord said: My Lords, in speaking to this amendment I shall also speak to Amendment No. 267, which is an amendment to the same purpose as is intended here to the solicitors discipline tribunal rules. What is provided for here is that the board where it is dealing with a misdemeanour or a complaint, so to speak, investigates it and publishes its decision. What is sought to be done by this amendment and Amendment No. 267 for solicitors is, if a complaint if found to be not made out, that there should be no reason to publish that decision.
If somebody makes a complaint that turns out to be unfounded, why should the fact of the complaint require to be published? It is for that reason that this is put forward. Certainly it would be a very considerable step for solicitors and could cause damage to them if they published the fact that there was a complaint against them which had in fact been found to be unfounded. It could do great damage to the solicitor, to his partners and to his business.
Of course we cannot say what would happen to the practitioners under this particular amendment because there are not any, but I would imagine it would have the same effect. It would appear that if the board, or the discipline tribunal, finds that a complaint is not made out and acquits, there should be no requirement that that should be published. I beg to move.
Lord Fraser of Carmyllie: My Lords, I recognise that this amendment seeks to give effect to a matter which was discussed during Committee stage; namely that named publicity for decisions of the discipline tribunal should be mandatory only in cases where the solicitor was found guilty of professional misconduct or of providing an inadequate professional service. I indicated in moving a comprehensive amendment about the procedures of the discipline tribunal that I wished to look again at this question.
The present position is that my right honourable friend the Secretary of State has considered, along with the Lord President of the Court of Session, whether a change should be made along the lines proposed in these amendments. He has resolved that
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such a change should be made. Clearly whatever is decided for the discipline tribunal should also apply to the conveyancing board, as the noble and learned Lord underlined in moving this amendment.
I can assure the House that this matter will be resolved when the Bill reaches another place. I should, however, indicate at this stage that, in restricting the mandatory publicity only to guilty findings, we would nevertheless wish to retain a discretion for the tribunal and board to withhold names, even where there has been a finding of guilty, where the interests of third parties might be seriously affected. I accept that the change should be made along the lines that the noble and learned Lord has indicated and, with that assurance, I hope that he will withdraw Amendment No. 107.
Lord Morton of Shuna: My Lords, I am grateful to the noble and learned Lord. A wise decision has been made—if not by him, he supports it. I ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 108:
Page 25, line 17, at end insert:
("() The Secretary of State may, by order made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament, amend subsections (3) (c) and (4) (b) above by substituting for the amount for the time being specified in those provisions such other amount as appears to him to be justified by a change in the value of money.").
The noble and learned Lord said: My Lords, I referred to this amendment when we discussed Amendment No. 105. It is the fruit of a discussion which took place in Committee between the noble and learned Lord, Lord Morton of Shuna, and myself. The amendment closely corresponds to a provision in the Solicitors (Scotland) Act 1980 which enables the upper limit on fines imposed by the Scottish Solicitors Discipline Tribunal to be varied by order of the Secretary of State.
The purpose of the power is merely to ensure that the deterrent value of the fine is not eroded by gradual inflation. While I do not expect any change in the fine maximum to be necessary for a considerable period of time, especially since it has been set in the Bill at the sizeable sum of £10,000, it is as well, as the noble and learned Lord, Lord McCluskey, indicated, to have the provisions relating to the fining powers of the board and the tribunal as alike as possible. I beg to move.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendments Nos. 109 to 115:
Page 25, line 18, leave out ("confirmation") and insert ("executry").
Page 25, line 20, leave out ("confirmation") and insert ("executry").
Clause 19, page 25, line 25, after ("by") insert ("(a)").
Page 25, line 26, leave out ("a confirmation") and insert ("an executry").
Page 25, line 27, after ("client") insert:
("; or
(b) a recognised financial institution in the course of providing executry services for a client,").

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Page 25, line 29, leave out ("body") and insert ("practitioner or institution").
Page 25, line 36, leave out ("a conveyancing practitioner and a confirmation practitioner") and insert:
("(a) a conveyancng practitioner;
an executry practitioner; and
(c) a recognised financial institution in relation to the provision of executry services,").
The noble and learned Lord said: My Lords, I spoke to these amendments when speaking to Amendment No. 54. I beg to move.
On Question, amendments agreed to.
The Deputy Speaker (Lord Hayter): My Lords, I cannot call Amendment No. 116 as the House has already agreed to Amendment No. 115.
[Amendment No. 116 not moved.]
Clause 20 [Interpretation of section 14 to 18].
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 117:
Page 2), line 38, leave out ("18") and insert ("19").
The noble and learned Lord said: My Lords, in speaking to Amendment No. 117 I shall speak also to Amendment No. 118. The amendments are consequential upon the insertion by the Committee of what is now Clause 19. I beg to move.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 118:
Page 25, line 39, leave out ("Confirmation Practitioners") and insert ("Executry Services").
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 119:
Page 25, leave out lines 41 to 45.
The noble and learned Lord said: My Lords, in speaking to Amendment No. 54 I spoke also to Amendment No. 119. I beg to move.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 120:
Page 26, line 7, at end insert:
(""executry practitioner" means a person registered under section 17 in the register of executry practitioners; "executry services" means the drawing and preparation of papers on which to found or oppose an application for a grant of confirmation of executors and services in connection with the administration, ingathering, distribution and winding up of the estate of a deceased person, but does not include anything which constitutes investment business within the meaning of the Financial Services Act 1986;").
On Question, amendment agreed to.
Lord Hayter: My Lords, I cannot call Amendment No. 121.
[Amendment No. 121 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendments Nos. 122 to 124:
Page 26, line 5, leave out ("a confirmation") and insert ("an executry").
Page 26, line 16, leave out ("and").
Page 26, line 18, at end insert:
("; and "recognised financial institution" has the meaning given to it in section (Executry services by recognised financial institutions) (2)").
The noble and learned Lord said: My Lords, I spoke to these amendments with Amendment No. 54. I beg to move.
On Question, amendments agreed to.
Clause 21, [Rights of audience in the Court of Session, the House of Lords, the Judicial Committee of the Privy Council and the High Court of Justiciary]:
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 125:
Page 27, line 28, at end insert ("which shall correspond as nearly as may be to those which apply to advocates.")
The noble and learned Lord said: My Lords, the amendment is the same as one which I moved in Committee and which the noble and learned Lord the Lord Advocate informed me was acceptable in principle. As he has not come forward with an amendment, at any rate so far as I can see, I have repeated the amendment to see what is to happen to it.
The purpose of the amendment is to ensure that the rules of conduct for the solicitor advocate are the same as the rules of conduct for the advocate. It is obviously desirable that they should be the same because they appear in the same courts. It is also desirable for the Council of the Law Society to make rules of conduct for any other purpose and it can now look at the rules of conduct of the Faculty of Advocates and use them as a base or even adopt them wholly. Something of that nature is necessary because there should be more or less just one set of rules of conduct. In the hope that this time the noble and learned Lord will accept the amendment in fact and not merely in principle, I beg to move.
Lord McCluskey: My Lords, I wish to add just two points. One purpose that the amendment would serve would be to give the Lord President clear guidance as to what he should be looking for in the draft rules prepared by the Law Society. Also, if the rules contained appropriate provisions of that kind, the judges would have greater confidence that all appearing before them would be observing the same standards, as it were, behind the scenes, in the preparation and conduct of cases. I support the amendment for all the reasons given by the noble and learned friend Lord Morton plus those additional reasons.
Lord Macaulay of Bragar: My Lords, I too support the spirit of the amendment. It does not stipulate that the rules must be the same. The words:
"as nearly as may be",
are perhaps of some significance, because they give scope to take account of the different branches of

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the profession doing the same job. There may be situations where the rules cannot be the same for both sets of people, but they should be as nearly the same as possible.
Baroness Carnegy of Lour: My Lords, is,
"as nearly as may be",
something that can be interpreted in law? I am fascinated. The noble and learned Lord, Lord Morton of Shuna, is nodding. Perhaps the expression is a legal one. I wondered how a judge would interpret it.
Lord Fraser of Carmyllie: My Lords, at this stage of the Bill, I am not in the business of making my intentions opaque. I had thought that the noble and learned Lord would appreciate that what I propose in Amendment No. 131 is intended to cover the matter which I undertook to take away when we discussed it in Committee. The latter amendment provides:
"and in considering any rules made by the Council under subsection (5), the Lord President shall have regard to the desirability of there being common principles applying in relation to the exercising of rights of audience by all practitioners appearing before the Court of Session and the High Court of Justiciary".
As the noble and learned Lord, Lord McCluskey, said, it would give the Lord President a signal. I indicated during that discussion in Committee that I was—I do not depart from it—sympathetic to the amendment's aim. I shall invite the House to approve Amendment No. 131, which I believe achieves broadly the same objective as that put forward in Committee and again in Amendment No. 125.
In my view, the Lord President is in the best position to judge the precise extent to which the rules governing solicitors practising in the Supreme Court should correspond to those governing the conduct of advocates. Amendment No. 131 therefore places a duty on the Lord President, when considering such rules, to have regard to the desirability of ensuring that both sets of rules are based on the same principles. The amendment will serve not just to ensure that the same high standards of conduct are required of all Supreme Court practitioners, but that their professional conduct will be determined by the same principles. I shall move the amendment in the hope that it will meet the concerns which were expressed in Committee.
It is interesting to note that in the preface to the guide to rules of conduct for advocates prepared by the Dean of Faculty, there is quoted the Royal Commission on Legal Services in Scotland. Reporting in 1980, it recommended that:
"The Faculty of Advocates should promulgate an authoritative written guide to the professional conduct expected of advocates which should be supplied to advocates and be available to the public".
In so recommending, the royal commission said:
"We believe that professional rules for advocates could be stated … succinctly in the form of general principles".
My point in moving Amendment No. 131 is that what is to be established—and the Lord President is well placed to do it —is the general principles that
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ought to be observed. It may be that the formulation of those principles in terms of rules may vary for solicitors and advocates. What is intended by Amendment No. 131 is that there should be that common core of principles governing those who are in practice. That seems to me to be the right way round.
Perhaps I may quote again from the preface to the faculty's guide:
"In places, it has been found convenient to state 'the rule' or 'the general rule'. Although convenient, use of the word 'rule' would be misleading if it were thought to imply that the rule is absolute and subject to no exceptions whatever the circumstances. The Guide must be read as a whole and interpreted according to its spirit rather than its letter. For the same reasons, it must not be assumed that it is enough for an advocate to keep within the letter of a 'rule' as stated in the Guide".
That further underlines the approach that I consider to be appropriate. The Lord President can be expected to consider what are those principles, and in the application of the particular rules put forward by the Faculty of Advocates, or more precisely in these circumstances the Law Society, he will see that there is a common spirit to both of them.
Lord McCluskey: My Lords, with the leave of the House, perhaps I may make one point in reply. I am perfectly happy with what the noble and learned Lord the Lord Advocate said. I apologise that I did not pick up the true import of Amendment No. 131, to which we shall come. However the House will appreciate that, in common with other noble Lords, I was a stranger to about 200 of the amendments until late last night when fortunately the noble and learned Lord the Lord Advocate faxed me a copy of all his amendments. I have been trying to digest them ever since and I have obviously not been entirely successful.
7 p. m.
The Earl of Selkirk: My Lords, where does the Lord President come in? In the rules in the book, the council should make these rules under this section. Does this override that section, or is it primarily a matter for the council to deal with?
Lord Morton of Shuna: My Lords, perhaps I may reply to the noble Earl. The council can only make rules with the approval of the Lord President. Therefore when the provision mentions the council making rules, it shows that the Lord President could have exercised his veto over them if he had wished to do so.
I am happy to withdraw the amendment. My excuse comes rather later in time because I did not see the government amendments until half-past one today. They were not available to me until then. Also no doubt a rather lame excuse is that I understood that the Government had some say in the groupings. If we were to interpret Amendment No. 131 as an answer to Amendment No. 125, they might have been grouped together. However, that is no doubt a lame excuse. I ask leave to withdraw Amendment No. 125.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 126:
Page 27, leave out ("an appropriate") and insert ("a").
The noble and learned Lord said: My Lords, in speaking to Amendment No. 126 perhaps I may also speak to Amendments Nos. 128 and 130. These amendments refine subsection (6) of Clause 21 along the lines of our discussions at Committee stage. In particular, they seek to meet the points raised in the helpful intervention of the noble and learned Lord, Lord Emslie. As I indicated during the Committee's consideration of Amendment No. 223A, I am mindful of the need to ensure that the integrity of supreme court pleaders is beyond doubt in every case. The second of these amendments therefore requires the council, when making rules relating to the acceptance of instructions by solicitors with rights of audience in the supreme courts, to set out those matters to which a solicitor should have regard when deciding whether to accept instructions from a particular client.
I would expect this part of the rules to be based largely, though not entirely, in paragraph 4. 5. 4 of the Guide to the Professional Conduct of Advocates, since the considerations set out therein will be material for all supreme court pleaders. I do not think it would be appropriate to set out in detail on the face of the statute the precise matters to which solicitor advocates should have regard in deciding whether to accept instructions and I hope that the House is content to leave this to the council to decide. Of course, as the noble and learned Lord, Lord Morton, has indicated in response to the noble Earl, any rules made under this clause by the council will require the approval of the Lord President.
The third of these amendments meets another point raised by the noble and learned Lord, Lord Emslie, and enables the council, when making rules of precedence between courts for the purposes of establishing where a solicitor advocate's proper duty lies, to distinguish between the Inner and Outer Houses of the Court of Session and between the High Court of Justiciary sitting either as a court at first instance or as a court of appeal.
These amendments therefore clarify the way in which subsection (6) is going to work in practice and make it clear that solicitor advocates will be bound by broadly comparable obligations to ensure representation to those who need it as are advocates. I beg to move.
Lord Morton of Shuna: My Lords, in dealing with this amendment the noble and learned Lord said, I think, that he was also dealing with Amendments Nos. 128 and 130. I quite see that the rules should provide for various positions. However, it is difficult if one puts into a statute that the rules are to deal with orders of precedence of courts. Those courts differ, depending on what is being done in which court. One cannot just state that one court has precedence over another because it may be that the continuation of a case before a lower court has precedence over something relatively insignificant in a higher court. Therefore I am not sure that Amendment No. 130 sits happily with the others, nor that it is necessary at all. In a sense I am
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foreshadowing the discussion that we may have on Amendment No. 127, which would remove the question of the council establishing an order of precedence.
Lord Fraser of Carmyllie: My Lords, perhaps I may respond to say that the noble and learned Lord is correct. In speaking to Amendment No. 126 I was also dealing with Amendments Nos. 128 and 130. The noble and learned Lord may recollect from his knowledge of the guide for the Faculty of Advocates, to which I have already referred, that in it not only is an order of precedence for the courts set out but in a subsequent paragraph the types of circumstances are spelt out where one would not necessarily follow that order of precedence.
The obvious example is where one had a single bill to appear before the Inner House and was halfway through a proof in the Outer House. There are general criteria to be set out which would establish for the solicitor-advocate that he ought to have regard to his duty to complete that continued proof rather than take up the single bill in the Inner House.
That is what Amendment No. 128 intends. It points the Council of the Law Society in the direction that I quoted in paragraph 4. 5. 4. Generally, I accept that just setting the order of precedence does not answer all the questions of what instructions one should follow. I hope that by giving this indication to the Council of the Law Society—it being well aware, as I know, of what is provided in the guide for the Faculty of Advocates—the matter will be truly dealt with.
Lord McCluskey: My Lords, I am reasonably satisfied with what the noble and learned Lord the Lord Advocate said in relation to this subject. The problem arises with a number of different amendments. However, I am still puzzled, as I was at Committee stage, by a concept contained in this clause and repeated in the amendments. The Bill states in subsection (6), page 27, line 29 onwards, the concept of a solicitor being instructed to appear in a court. In Amendment No. 128 the noble and learned Lord the Lord Advocate refers to the solicitor determining whether or not to accept instructions.
As I have already pointed out, as regards the Court of Session or the High Court of Justiciary, I understand the position to be that counsel is instructed not by the client but by the solicitor. The instruction will take the form of a letter which is sent to him requiring him to appear in a particular case on a particular day. Those are his instructions. However, I do not understand how that concept works in relation to a solicitor because he is dealing directly with a client. Unless the client is a corporate body or someone in that position, he is unlikely to issue the solicitor with a formal letter stating that he instructs the solicitor to appear in a particular court on a particular day. I do not know how this provision will work. I do not know whether the Government have considered it deeply or whether they are content simply that the matter should be left to the Council of the Law Society. I am not sure that these provisions will work until someone has grasped that particular nettle.
Lord Cameron of Lochbroom: My Lords, I am bound to say that I disagree with the noble and learned Lord. I should have thought that the word "instructions" is capable of being read in various lights according to the relationship between the client and his solicitor or that between the client, the solicitor and the advocate. I can conceive of a situation where a client may give general instructions to a solicitor to appear for him in a matter which involves criminal proceedings. I should have thought those instructions would be covered by the word that appears in Amendment No. 128. However, if the word were read as narrowly as the noble and learned Lord suggested, there could be problems, but I am bound to say that I would not read it as narrowly as that.
Lord Fraser of Carmyllie: My Lords, I did not envisage the word "instructions" in this context to be a term of art that applied only to advocates. However, I shall ask the Law Society of Scotland whether it envisages any difficulty in determining what the word "instructions" amounts to. If the matter needs to be looked at again, it can be dealt with in another place.
On Question, amendment agreed to.
Lord Morton of Shuna Lord Morton of Shuna moved Amendment No. 127:
Page 27, leave out lines 34 and 35.
The noble and learned Lord said: My Lords, this amendment concerns rather a different point. It is a fairly straightforward, easy point. The noble and learned Lord, Lord Emslie, has spoken on this matter. It is bizarre that the council should make rules establishing the order of precedence of those courts. The Council of the Law Society should not make rules establishing the order of precedence of the High Court of Justiciary or of the Court of Session. That is a matter for the courts.
I suggest it would be proper for subsection (6)(a) of the proposed new Section 25A to be left out because that would not make any difference to the rules that the council will make. However, it would remove the suggestion that the Council of the Law Society is setting the order of precedence of the supreme courts in Scotland. That is the purpose of the amendment. I beg to move.
Lord Macaulay of Bragar: My Lords, perhaps the noble and learned Lord, Lord Morton of Shuna, is reading this part of the Bill rather narrowly by suggesting that the council will make the rules establishing the order of precedence. I should have thought the provision was more directed towards the matter of publication of the existing rule; in other words the council itself will not make the rules. I realise that the provision states that it shall make rules but I doubt whether that was the intention behind the wording. I should imagine that the rules will be set and can be published for guidance.
New practitioners coming into what is a complicated field should be given as much guidance as possible regarding where they should be at any particular time, and in particular which court takes precedence over another. Perhaps the noble and
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learned Lord the Lord Advocate may wish to reconsider the wording of subsection (6) (a) of the proposed new Section 25A and adopt my view, if that is the right view. Of course if it is the wrong view, the noble and learned Lord will inform me of that.
Lord Fraser of Carmyllie: My Lords, I certainly do not envisage that the Law Society of Scotland will stand on its head the order of precedence of the courts in Scotland. Indeed the order of precedence of courts is a matter extending beyond the jurisdiction of the Scottish Courts into Europe. There is such an order of precedence set out in the guide of the Faculty of Advocates. I have referred to that. I envisaged that the Law Society would follow that guide. Frankly I cannot imagine any circumstances in which the Law Society is likely to depart from that established order of precedence. However, it is important that that should be set out in rules for the benefit of a new practitioner who may have had little experience of these matters. In any event, if there is any risk of the Law Society going off the rails in this matter, I can only repeat the point that the noble and learned Lord, Lord Morton of Shuna, made earlier, which is that the rules would be subject to the approval of the Lord President.
Lord McCluskey: My Lords, another point that arises in connection with this matter is again one which I sought to raise in Committee. However, it came out in rather a confused fashion in the report of the proceedings. The position is that it is not simply a matter of precedence as between courts. An advocate or a solicitor may be instructed—if that is a possible concept—to appear at a planning inquiry or before an industrial tribunal. Someone has to determine whether his appearance in a summary criminal court which may last for half an hour takes precedence over his duty to appear for his client in a planning inquiry which may last for half a year. There must be some solution to a conflict of this kind. I do not think that the Bill, as it stands at present, addresses that matter at all. I have found no trace of that matter either in the Bill or in the proposed amendments.
7.15 p.m.
Lord Morton of Shuna: My Lords, the matter is merely a question of English. The Bill states:
"the Council shall make rules establishing the order of precedence".
If the word "establishing" was replaced by "stating", the position might be much clearer. It is the concept of the Council of the Law Society establishing the order of precedence that gives a sense of power to the council. That is inappropriate. That was all my amendment sought to suggest. However, in the hope that the noble and learned Lord may see there is some force in the argument, and in the hope that he may put the matter right elsewhere, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 128:
Page 27 line 35, at end insert:
("() stating general criteria to which solicitors should have regard in determining whether to accept instructions in particular circumstances; and").
The noble and learned Lord said: My Lords, I have a ready spoken to this amendment in relation to Amendment No. 126. I beg to move.
On Question, amendment agreed to.
Lord Macaulay of Bragar Lord Macaulay of Bragar moved Amendment No. 129:
Page 27. line 37, leave out ("possible") and insert ("reasonably practicable").
The noble Lord said: My Lords, this amendment comes within the area we have just been discussing. It considers the issue of how practical it will be for solicitors to follow the practice of advocates whereby the latter are from time to time taken out of one case and put into another. That occurs particularly where there is a shortage of criminal practitioners. Subsection (6) of the proposed new Section 25A states:
"Where a solicitor having an appropriate right of audience in any of the courts mentioned in subsection (1) is instructed to appear in that court, those instructions shall take precedence before any of his other professional obligations, and the Council shall make rules securing, through such of their officers as they think appropriate, that, where possible, any person wishing to be represented before any of those courts by a solicitor holding an appropriate right of audience is so represented".
It appears that the Council of the Law Society must, through its officers, find an advocate-solicitor, if the client wishes to obtain one. As the provision presently stands, the words "where possible" are used. However, what is possible may not be reasonably practical. It may be easy enough, for example, to take an advocate-solicitor from the south of Scotland up to Inverness to conduct a criminal trial, but whether it would be reasonably practicable for him to do so is another matter. He may have an existing contract with the present client. He may be in the middle of a difficult case. He cannot leave that case, as matters stand, without laying himself open to an action for damages at the hands of the client although he is literally forced to leave the client and fulfil his duties under the terms of subsection (6)(b) of the proposed new Section 25A.
The purpose of the amendment is to take reality into account and give the broader base of reasonable practicability in the instruction rather than the narrower one of possibility. It has to be borne in mind that we do not know how many solicitors in Scotland will take advantage of the provisions of the Bill and seek rights of audience in the higher courts. We hear varying accounts of how many people will do so, ranging from four in Edinburgh, four in Glasgow, and two in Aberdeen, to 200 solicitors. If the number is at the lower end of the scale and the Law Society is forced to use one of a very small number of advocate solicitors that would create great difficulty for the advocate solicitor. It would make it easier for everyone if the broader concept of reasonable practicability were adopted. I beg to move.
Lord Mackie of Benshie: My Lords, it might also make it reasonably possible.
Lord Fraser of Carmyllie: My Lords, this is a point which has been raised before. It is one on which I believe the Law Society of Scotland is unduly sensitive. The society is required to make rules;
"securing, through such of their officers as they think appropriate, that, where possible, any person wishing to be represented before any of those courts by a solicitor holding an appropriate right of audience is so represented".
We are dealing with a situation in which somebody needs to be represented in court not just by an advocate or a solicitor advocate but exclusively by a solicitor advocate rather than by a member of the Faculty of Advocates with rights of audience. I find some difficulty in believing that such a set of circumstances will arise very often.
I see little to be gained by accepting the amendment. The provision makes perfect sense as it is drafted and the distinction between what is possible and what is reasonably practicable seems a nice one. It is reasonable to expect the Law Society to fulfil its duty under subsection (6) where it is possible for it to do so. I am aware that it does not in any way wish to diminish the importance of that duty. Since I am confident that it will take all possible steps to fulfil its obligations, I see little to be gained by accepting the amendment. I hope that if the society reflects on the matter it will be reassured that the likelihood of any difficulty arising is extremely limited.
Lord McCluskey: My Lords, I support the amendment. The noble and learned Lord the Lord Advocate said that there is little to be gained by accepting it. I wonder whether there is anything to be lost by accepting it. "Possible" and "practicable" in law almost certainly mean the same in a context such as this. "Practicable" means able to be achieved by known means and resources; "reasonably practicable" introduces a concept of flexibility and allows for some tolerance.
I sympathise with the difficulties. It may well be that those difficulties will be experienced in the early days but not thereafter. It may be that the council could modify its rules in due course. However, unless the noble and learned Lord the Lord Advocate believes that there is something wrong with the proposal rather than a matter of semantics, since people feel quite strongly about the subject I believe there is something to be said for it. I support the amendment.
Lord Fraser of Carmyllie: My Lords, I am not prepared to make any firm undertaking on the subject. The impositions on the Faculty of Advocates where someone wishes to secure the services of an advocate are very stern indeed. If the Law Society of Scotland is prepared to accept that its members are to be given rights of audience it should not enjoy any lesser duty. "Possible" seems to me to be an appropriate test. If in very rare circumstances there were difficulties I have to say, so be it. The rights of audience are to be the same as those given to members of the Faculty of Advocates. However, I shall reflect on the matter so long as that is not taken

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as an indication of a promise to bring anything forward.
The Earl of Selkirk: My Lords, as someone looking at the matter from the outside I believe the amendment to be much more sensible because it is practicable. If something is possible that means that one goes to almost any lengths to do it, which is not what is intended. I believe that what is intended is what is most practicable and satisfactory for solicitors.
Lord Macaulay of Bragar: My Lords, I do not believe that the Law Society wishes to be difficult or sensitive about this matter. It has to face up to the realities of life in the courts. It was in an effort to be helpful that the amendment was tabled. As has already been observed, there is no difference between the two sets of words in terms of practicability. There would be no harm in the Government thinking again and taking the wording proposed by the Law Society. In the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 130:
Page 27, line 40, at end insert;
("and for the purposes of rules made under this subsection the Inner and Outer Houses of the Court of Session, and the High Court of Justiciary exercising its appellate jurisdiction, may be treated as separate courts.").
The noble and learned Lord said: My Lords, in speaking to Amendment No. 126 I also spoke to Amendment No. 130.
Lord Renton: My Lords, although my noble and learned friend has spoken to the amendment, I believe that it is within the rules of order for me to suggest that the word "may" should be "shall".
Lord Fraser of Carmyllie: My Lords, I was not conscious that I had finished moving the amendment. I beg to move.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 131:
Page 27, line 46, at end insert ("and in considering any rules made by the Council under subsection (5), the Lord President shall have regard to the desirability of there being common principles applying in relation to the exercising of rights of audience by all practitioners appearing before the Court of Session and the High Court of Justiciary.").
The noble and learned Lord said: My Lords, when we debated Amendment No. 125 I explained at some length the purpose of Amendment No. 131. There may be other points that I can answer on the amendment. I beg to move.
Lord McCluskey: My Lords, I do not want to keep noble Lords from their dinner, but I should like to congratulate the noble and learned Lord the Lord Advocate on using a gerund in the third line of the amendment. I hope that this reformation in his character and syntax will pervade other parts of the Bill in due course.
On Question, amendment agreed to.
Lord McCluskey Lord McCluskey moved Amendment No. 132:
Page 28, line 38, leave out subsection (15).
The noble and learned Lord said: My Lords, noble Lords will recognise that I am returning to a matter which greatly concerned me at the Committee stage. This is the first of several provisions —although there are slight differences in relation to particular clauses—which provide that:
"Where a function is conferred on any person by this Section he shall exercise that function as soon as is reasonably practicable".
The only persons on whom a function is conferred by this clause are the Secretary of State and the Lord President, because, if I am right, the Council of the Law Society is not a person. Accordingly, although it has many functions which are conferred by subsections (2), (3), (4), (9), (12) and (14) the obligation which is laid upon the Secretary of State and the Lord President to carry out those functions quickly is not conferred upon the Council of the Law Society. I wonder why the Council of the Law Society, which has most of the functions, is to be free from the obligation to exercise its functions as soon as is reasonably practicable.
Why is it, on the other hand, that the obligation is laid upon two great officers of state? On a previous occasion I asked why it was that this provision was included and no precedent could be found for it. I asked which of those great officers of state is not to be trusted. I was told that both could be trusted. I want to ask what is the hurry about this, because, as we know, the Secretary of State does not necessarily intend to bring in this provision by commencement order immediately. It may be postponed.
My last point is a question for the noble and learned Lord the Lord Advocate, of which he has had ample notice. Is it intended that there should be judicial review in relation to a failure by the Lord President or the Secretary of State to move as soon as is reasonably practicable? In other words, can any person who can qualify an interest in a title say to the Lord President, "You are not moving quickly enough", raise an action for judicial review and have the inactivity of the Lord President or the Secretary of State brought under review by a judge in the Court of Session? That is a question of some importance which arises more than once.
In those circumstances I believe that there is some value in the amendment. I beg to move.
7.30 p.m.
Lord Cameron of Lochbroom: My Lords, I support my noble and learned friend on this matter. At first blush it seems to me that there is no necessity for the provision. Having read through it again, like my noble and learned friend, I still fail to understand why it should be there when the only persons to whom it could possibly relate are the two persons whom he identified. I can see no other identifiable person.
The Earl of Selkirk: My Lords, I find the same problem. I have never understood what the provision meant, why it meant what it did and who was gaining or losing. It does not make sense. I thought that it referred entirely to solicitors and that they must

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use their right of audience straightaway, otherwise someone would take it away from them. That is the only sense that I can make of the provision, although I am sure that it is wrong. Can my noble and learned friend make any sense or useful purpose of this small and rather ridiculous provision?
Lord Fraser of Carmyllie: My Lords, in view of the expressions about the last provision in Clause 21, it might be appropriate to break for dinner after this amendment. If I understand the groupings correctly, the noble and learned Lord was also speaking to the comparable provision in Clause 22.
Lord McCluskey: My Lords, perhaps I may assist the noble and learned Lord. There are slight differences and I do not want to deprive myself of the right to add a few words in relation to the other amendment.
Lord Fraser of Carmyllie: My Lords, that may be so, but I believe that the noble and learned Lord made a slip because he indicated that the Secretary of State might delay in introducing Clause 21. I do not think that I have ever indicated that. However, I have certainly indicated that, to avoid the Lord President and the court being over-taxed in those matters, the Secretary of State would have it in mind to delay the introduction of Clause 22. That is why I thought that the noble and learned Lord was dealing with both provisions.
The noble and learned Lord said that the council appears, to be excluded from the provisions of subsection (15). That was not intended. If it has been omitted from that extremely useful provision in Clause 21, steps can certainly be taken to ensure that it is subjected to it.
When the provision comes into effect, it is important that all due progress should be made on it. It has been considered by the Government and I can only repeat what was said at length in Committee; namely, that it was considered desirable that anyone who had a function conferred on him or her should exercise that function as soon as was reasonably practicable.
We want to ensure that there will be no delay in bringing the provisions into effect once the commencement order has been secured. In a sense, that applies with greater force to Clause 22. That is why I am keen to link it to the provision with regard to the elaborate arrangements set out in the clause.
I know that the noble and learned Lord does not like the provision. He alternates between saying that it is anodyne and/or nonsensical and suspecting that there is something deeply sinister behind it. I do not think that it is anodyne and I certainly do not consider it to be sinister. It is a useful indication for the legislature to give to those who have functions to perform. I suggest that it should remain within the clause.
Lord McCluskey: My Lords, I do not think that the provision is anodyne or sinister; it is just silly. That is the point that I have sought to make from the beginning.
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I was not guilty of making a slip. I appreciate what the noble and learned Lord said about the Secretary of State not bringing into force the then Clause 21 until Clause 20 had been brought into force. The provisions of Clause 62 permit the Secretary of State not to bring the clause into force once it is a section, so it might be six months or 10 years before it is brought into force. There is nothing to compel him to do that.
Those who want to be conveyancers will recall the disappointment that was felt in England when the then Lord Chancellor, the noble and learned Lord, Lord Hailsham, failed to bring into force the provisions which allowed certain people to do conveyancing. The Secretary of State could do precisely the same here in relation to these matters.
I am surprised to hear the noble and learned Lord the Lord Advocate confess that he thought the word "person" embraced the Council of the Law Society. That seems to me to be a glaring error. I cannot imagine that the Council of the Law Society, distinguished though it may be, would allow itself to be called a person. The functions conferred upon it are not therefore struck at by the provision.
That is just one of the reasons why I think the provision is silly. However, at this time of night I do not propose to divide the House. In the circumstances, and for the moment, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Strathmore and Kinghorne: My Lords, I beg to move that further consideration on Report be now adjourned. In moving this Motion, perhaps I may suggest that the Report stage begin again at twenty-five minutes to nine.
Moved accordingly, and, on Question, Motion agreed to.

Broadcasting Bill
Brought from the Commons; read a first time, and to be printed.

Computer Misuse Bill
7.37 p.m.
Viscount Colville of Culross: My Lords, I beg to move that this Bill be now read a second time.
This is a Private Member's Bill. It has passed through another place in the hands of my honourable friend the Member for Romsey and Waterside. He has acquired considerable acclaim for the way in which he has handled it and, having read the Official Report, I can see why.
I do not pretend that the text of the Bill is easy, but that is because the subject matter with which it deals is in itself complicated. It deals with the mischief which is caused by those who are rather too dextrous on a computer keyboard —those who go in for what is called hacking; those who exceed their authority as employees when they already have

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access to a computer; and those who use computers as a way in to more serious crimes or attempted crimes—and with the general area of what are commonly called viruses, to which I shall return later.
The Bill is complicated for four reasons. Because many of the processes —indeed all of them except the initial stages—are electronic, they are instantaneous and hard to detect. The most malicious misusers of computers have sinister motives in that they pave the way for other serious offences such as blackmail or fraud, even though those may not in the end occur. The Bill must therefore fit in with the criminal law on the difficult subjects of attempts, conspiracies and incitement. Computers work at high speed across international boundaries, not least the jurisdictional boundaries within the United Kingdom, where there are three such boundaries—between England and Wales, Scotland and Northern Ireland. All you need is a home computer and a telephone connection called a modem. Then, through the ever-expanding international telephone network, you can try to gain access into computers worldwide, including mainframe computers. I may say that it is usually done at somebody else's expense.
The Law Commissions both in England and Wales and, before them, in Scotland, have consulted widely. Their reports are the basis of this Bill. Indeed, it is the beginning of the Explanatory Memorandum which your Lordships will see on the front page. The Scottish report came out in 1987 and the English one as recently as October of last year. So no time has been wasted in implementing what the Law Commissions have suggested to us.
The Law Commissions have continued to assist in the preparation of the Bill and in its passage through another place. As your Lordships will see, the drafting has been very carefully worked out so that it applies to all three domestic jurisdictions in the United Kingdom to which I have referred.
The Law Commissions found that the misuse of computers is increasing and at an alarming rate. There are in fact no reliable statistics, but anecdotal evidence from computer users and from the police points to a serious problem which is increasing. Indeed, the police stated in the press last week that the number of cases coming to their attention rose sharply last year. One of the reasons why it is difficult to gauge the measure of the problem is because some of the users are too embarrassed to report the fact that their computers have, as it were, been broken into.
One of the troubles is that there is a sub-culture which sees no harm in invading other people's computer systems. It merely demonstrates (so these people think) the computer skills of the person who does it. It may even be the basis for an application for a job. However, as I said a little while ago, there are also much more sinister motives.
The Bill addresses the protection of the trustworthiness and integrity of computer systems as such and not the protection of the information which is in them. The protection of the information contained in them is a different and a more
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controversial matter and it is not part of the scheme of this Bill.
The integrity of the system itself is plainly necessary because there are all kinds of confidences including commercial and industrial matters and the world of personnel, quite apart from matters such as defence secrets and other data affecting national security which are nowadays held on computers.
At the other end of the scale there is material like forthcoming exam papers which some students might be only too anxious to know about in advance. Expensive technology has been installed to try to protect these computers. If that protection is breached it is extremely expensive to put matters right again and meanwhile the whole system is suspect.
The Bill contains three elements. The first three clauses contain three new criminal offences. After that, Clauses 4 to 9 contain new rules governing the jurisdiction of the courts to try computer misuse cases. That arises from the international element in this matter. The last clauses in the Bill, Clauses 10 to 18, are largely consequential and technical, including definitions. The exception is Clause 14, which provides powers of entry, search and seizure for the police in the case of an offence under Clause 1. I shall return to that in a moment because it has attracted considerable interest.
The three new criminal offences are these: Clause 1 creates a new offence which is triable summarily in the magistrates' court in England and Wales and Northern Ireland and in the sheriff court in Scotland. It is the offence of unauthorised access to programs and data held in computers, for which the maximum penalty is six months or a fine or £2,000. The terminology in this Bill may not appeal to the English purists among your Lordships but it is the current way in which computers are described and in which all their processes arc normally referred to. It seems sensible, therefore, to use the terms that arc familiar to the users of computers.
The objective of Clause 1 is to deter deliberate, unauthorised access or attempts to gain access to computers. To some extent that is hacking but it may also include those insiders who arc authorised to use some parts of the computer system but who go beyond their remit. That is only if the conduct is intentional. The essence of this offence is that it should be intentional and not merely the result of being inattentive, careless or improperly informed; those who go beyond their remit by mistake are excluded.
Clause 2 creates a more serious offence. It is triable both ways—that is to say, either summarily or on indictment. It relates to unauthorised access with intent to commit or facilitate the commission of a further, more serious, offence. I referred to these earlier as fraud, blackmail or something of that kind. There are substantially more serious penalties which carry a maximum of five years' imprisonment on indictment and an unlimited fine. It makes an offence under Clause 2 an arrestable offence under the Police and Criminal Evidence Act.
In fact it is still a preliminary offence in that it will bite at the stage before the further offence of

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blackmail, fraud or whatever is actually committed. If the person concerned looks into a computer to get information for the purpose of blackmail or fraud, that of itself would be an offence under Clause 2 even before a further offence has been committed.
Clause 3 creates another offence which is equally triable both ways. It deals with the unauthorised modification of data or programs held in computers. The intention here is to remove a current uncertainty which exists under the law concerning damage to intangible property such as data. It is not intended to cover physical damage to the computer or to the software because that would remain within the existing, criminal law of criminal damage. The criminal law has had to be stretched. It is not certain how far it will go. Therefore, it seems better to create a new, specifically designed offence to deal with this matter.
The offence is intended to deal with matters like erasure of information or the putting into circulation of disks which are infected by some malicious code designed to impair the performance of the computer or to make it work so hard that it runs out of room altogether. I said that I would refer to viruses again, but it is not just a question of viruses. Apparently, the technology includes functions like Trojan horses, logic-bombs, viruses themselves, worms, bacteria and rabbits. I know what some of them mean, though not in detail what they all mean.
Nevertheless, they do an enormous amount of damage. I suggest to your Lordships that a deterrent, as set out in Clause 3, is necessary. There are reservations about the necessity for bringing in new criminal offences. There always are reservations. In this case they really concern the duties on the owners of computers themselves. They should take sufficient trouble to protect their machines from interference from outside. They do because they take a great deal of trouble. However, the difficulty is that the ingenuity of those who try to gain access, whether as a matter of hobby or for more malicious purposes, is such that very frequently these protective processes are overcome.
The analogy must be with the household and the burglar. We do not wish to suggest to the householder that he must take precautions to make his house absolutely impregnable to a burglar, because we all know that that is impossible. We also have the crime of burglary and aggravated burglary, which makes criminal the other side of this equation. So, I suggest to your Lordships, should we have in the world of computers, although perhaps my noble friend Lord Trefgarne will comment on the way in which the Government are encouraging computer users to protect their property.
I said that Clauses 4 to 9 cover jurisdiction within the United Kingdom and internationally. That drew on another work by the Law Commission. In April of last year it published a report on Jurisdiction over Offences of Fraud and Dishonesty with a Foreign Element. That is a fascinating document and deals with an extremely abstruse area of criminal law, none of which is the same in England, Wales and Northern Ireland as it is in Scotland. That is the case with a great deal of criminal law.
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At present the rules provide that English and Welsh courts—perhaps also Northern Irish courts, but I hesitate to speak about Scotland—have jurisdiction only if the offence is regarded as having taken place in the United Kingdom. That implies that the last event necessary to the completion of the offence took place here. The Law Commission looked at the rules and the case law. It came to the conclusion that the rules are unnecessarily restrictive and that they are inadequate to deal with computer misuse across national boundaries. It sets out its reasoning most clearly in its report. As regards the jurisdictional provisions, the intention is to make it possible to prosecute for computer misuse offences if the accused or any affected computer was in the part of the United Kingdom jurisdiction in question at the time that the offence occurred.
Other complicated provisions in this part of the Bill adapt the criminal law on attempt, conspiracy and incitement, which, as I said at the beginning, are complicated concepts in the criminal law. That is achieved by amending the existing legislation in respect of at least two.
The last part of the Bill, Clauses 10 to 18, deal with consequential provisions and some important definitions. That is with the exception of Clause 14. There was a considerable amount of debate about the clause in another place and it was introduced in the Standing Committee. I have looked at the matter carefully because it concerns the Police and Criminal Evidence Act. It adds a new power which is not in existence at present.
I suggest that, although the provision may be controversial, it is probably better that we do not attempt to meddle with it because it was the subject of a great deal of discussion in another place. Eventually a certain degree of unanimity was reached although it was not total. The trouble is that Clause 1 of the Bill introduces a new offence which is summary only. The police powers of entry, search and arrest under the Police and Criminal Evidence Act relate to arrestable offences —those which carry a five-year sentence or more—or to serious arrestable offences, for which there is an even more complicated definition in the Police and Criminal Evidence Act. It was decided—I suggest, rightly —that there should also be a power of entry and search for the police in relation to the summary offence under Clause 1. That provision is contained in Clause 14.
I have talked to members of the police force about the matter and read what they stated in The Times last week. They would like to have more substantial powers to investigate the house or the room where the computer access is being gained to see whether they can discover more about it. They would also like more sophisticated powers to deal with the communications in the course of their transit through the telephone system. There are endless complications in that respect and we enter the realms of other legislation such as that relating to the interception of communications. Unless noble Lords wish me to do so, I shall leave out that matter.
I suggest that we have achieved a balance. We have given a new power of entry and search while at the same time protecting the civil liberties which

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were so carefully balanced in the Police and Criminal Evidence Act. For that reason I suggest that we now have a provision in the Bill which is properly balanced.
At the end of the Bill's passage through another place my honoruable friend for Romsey and Waterside said that he thought the Bill was well balanced and now well-drafted and defined. I venture to agree with that assessment. The Bill deals with specific mischiefs which have been clearly established and properly investigated by the Law Commissions. It introduces deterrents into the system to try to stop the pre-emotive provisions. They ought to be extremely useful in deterring those who wish to partake in such activities and should do so before the scale of the problem gets out of hand. For that reason I suggest that this is a timely moment to consider the Bill. I commend it to your Lordships and hope that it will have as safe a passage through this House as it had through another place. I commend the Bill to the House.
Moved, That the Bill be now read a second time—(Viscount Colville of Culross.)
7.57 p.m.
Lord Avebury: My Lords, I must preface my remarks by declaring an interest. I am a director of a company which markets computer hardware and software and which is sometimes called on to advise clients about excluding viruses from their systems or improving their existing protection against viruses.
We are extremely grateful to the noble Viscount, Lord Colville, for his lucid explanation of a complex piece of legislation. It was demanded by the computer industry and has been endorsed by all the principal companies in the British Computer Society. However, I find myself being slightly heretical because, for reasons that I shall attempt to explain, I cannot express the same unqualified enthusiasm for the Bill as was displayed by another place. It attempts to deal with two menaces facing computer users and undoubtedly they are serious. The first is the unauthorised accessing of confidential information simply in order to break confidentiality or in order to commit some other more serious offence. The second menace is the unauthorised alteration of programmes or data.
As I see it, the problem is one of the detection and conviction of the criminals rather than the multiplication of offences which may be difficult to prove in the courts. In moving the Second Reading of the Bill, the honourable gentleman the Member for Romsey and Waterside said that he had consulted the police who stated that they had the powers and the expertise to implement it. However, that was without qualification. It was not explained how that was to be done. I am afraid that even though the honourable gentleman pre-empted that remark, users may be lured into a false sense of security and some may not take the greater and more thorough precautions necessary to counter the increasing risks which the noble Viscount mentioned and protect themselves against loss or damage caused by the kinds of misuse dealt with under the Bill.
The noble Viscount, Lord Colville, said that there were no statistics. However, one statistic was
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mentioned by the honourable gentleman in another place; that is, that over the past five years the Department of Trade and Industry has verified 270 cases of computer misuse within the meaning of this Bill and that only six have been brought to trial and only three were successfully prosecuted for fraud. I should be interested to know from the Minister when he replies how many of those were Clause 3 offences, which are intrinsically far more difficult to nail down, and how many were Clauses 1 and 2 offences. In fact, a more comprehensive analysis of those 270 offences would be extremely useful when we deal with the Bill in Committee.
The noble Viscount mentioned the anecdotal evidence which comes from the police and from some users. He quite rightly pointed out that some are reluctant to expose themselves to ridicule by admitting that offences have been committed against them, and thereby rendering themselves liable to the criticism that they did not take the proper precautions. Perhaps the Minister would ask police forces in all three jurisdictions to report any offences which come to their attention to some central point so that over a period of time there would be better information because I think we are legislating slightly in the dark. Even though that could not be achieved in time for the deliberations this Bill, I imagine that this will not be the last occasion on which Parliament attempts to deal with the growing menace of computer misuse.
I turn to the problem of viruses which can originate from anywhere in the world. They may get into the system without any person having a malicious intent because disks are exchanged routinely between users. Therefore, when a particular user has been infected by a virus, he may pass it on completely unwittingly to an associate or colleague. One virus which has been encountered quite frequently is the so-called Jerusalem virus. It is given that name because it is said to have originated in the Hebrew University of Jerusalem. That is invisible to the user, lurks in the system tracks of the machine and manifests itself by adding a few k to the length of. exe or. com files on the hard disk so as to slow up the operation of the system and make the hard disk completely unusable after a fairly short period of time.
The victim who is infected by the virus which is inadvertently passed on to him by a colleague or friend, has no redress against the author who produced the virus. Even if that person could be identified, he could not be prosecuted in England or Scotland under Clause 3 because he is not within the jurisdiction. Even if identified, he is not himself passing on the virus. It has now reached the 120th or 190th party. The passage of the virus from one user to another is not within the control of the person who originally wrote it in the Hebrew University of Jerusalem.
The honourable Member who promoted the Bill in another place also mentioned the AIDS disk which was sent to many people in Britain apparently from an address in W. 1. The person who mailed the disks was alleged to be a Dr. Lewis Popp. He has now been arrested in Ohio where he is being charged with demanding money with menaces. That is because when the disk is put into the machine it displays a

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message saying that unless a large sum of money is sent to an address in Panama after so many accesses of the machine the hard disk will be wiped clean.
It is very interesting that no special legislation was needed in the United States because Dr. Popp was charged with demanding money with menaces and not with any specific computer-related offence. Presumably he could have been charged with an offence of that kind in this country had he been in our jursidiction. However, what would have happened had he mailed the disks to people in the United Kingdom from France or the United States? As the noble Viscount, Lord Colville, explained, an offence would have been committed because the effect of mailing the disk is to alter the contents of a computer in this country. But how would it be possible to catch him and try him in our courts?
I wish to ask the Minister three questions. First, will it be possible for us to extradite people who commit these offences? If anyone wishes to charge Dr. Popp with an offence in this country, can he be brought here from Ohio to stand trial?
Secondly, are we certain that a person who maliciously distributes a virus could not be successfully prosecuted under the existing legislation for malicious damage? I shall return to that matter if a few moments because that is something which the noble Viscount, Lord Colville, mentioned. Thirdly, to repeat my earlier question, can we be told how many of the 270 cases known to the DTI concerned viruses?
I fully endorse what the noble Viscount said about taking adequate precautions, although I am not so certain that users already carry out their obligations in that regard although many do. However, there are common sense precautions which can be taken against unauthorised access generally. First, obviously people should not leave machines unattended in a room to which outsiders may have access. Secondly, there should be password protection for sensitive information. Certainly disks should not be used which have been received from unfamiliar sources like the AIDS disk which I have mentioned. Data should be backed up regularly. Finally, virus detection software should be used so that if viruses enter the system they can be detected and eradicated before they do a great deal of damage.
I turn to the unauthorised accessing of computers where the intent is to acquire confidential information either for its own sake as in Clause 1 or with a view to the commission of another offence as in Clause 2. The Law Commission found that hacking, as unauthorised or attempted access is called,
"is sufficiently widespread to be a matter of major and legitimate concern to system users".
Even though sensitive applications like air traffic control are relatively less vulnerable because of the emphasis by its users on security, the Law Commission considered that it would be unwise to wait until somebody succeeded in penetrating those defences before protecting them by law. It pointed out that there was already evidence of interference in more open systems where there are intrinsically greater difficulties in stopping the hacker because
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the greater the degree of protection, the less convenient the system will be for the ordinary user. Therefore for example the public electronic mail services are relatively vulnerable.
The criminalisation of hacking may not result in many prosecutions; but the Law Commission felt that it would alter the perception of it, and the noble Viscount referred to the climate in which hacking is considered to be harmless amusement. What was an amusing diversion for computer enthusiasts in the past is now considered to be a crime. One hopes that that will be enough to deter the amateur. The journalist, for example, who pried into the electronic mailbox of His Royal Highness the Duke of Edinburgh could find himself becoming the guest of Her Majesty the Queen for six months if he did that again.
The amateur hacker likes to enter computer systems purely as a game, challenging the defences put up by software designers, and he is dealt with under Clause 1. Those who intend to cause damage to the systems, three examples of which are given in paragraph 1. 16 of the Law Commission's report, would be dealt with under Clause 3. I return to the Criminal Damage Act 1971 as being a possible way of dealing with those crimes. Would it have been so difficult to extend the definition of property to cover whatever kinds of storage media are likely to be used on computers? In the leading case of Cox v. Riley, the information was stored on a plastic card, so presumably hard disks, floppy disks, optical disks or tape streamers are covered, by analogy, under existing legislation.
An offence already existed when data attached to tangible property was altered or destroyed, and under this Bill we are reducing the penalties provided for in the 1971 Act as if we saw the damage caused to computers as less important than other kinds of damage. As the noble Viscount is aware, these penalties are less than those provided for under the Criminal Damage Act 1971.
The problem is that the Criminal Damage Act has given rise to a false distinction —if I may say so as a non-lawyer—between modes of trial according to the value of the property damaged. It is the value of the consequential losses that is important. Alteration of drug dosages is given as a hypothetical example by the Law Commission. The program which calculates the drug dosages may be worth only tens or hundreds of pounds, but the consequences of altering the program could be lethal. We have therefore paid too much attention to the value of the property damaged and less to the possible consequences of that damage in making the distinction between the modes of trial.
I turn now to Clause 2 offences, where the unauthorised access is preparatory to the commission of some further offence. Noble Lords will correct me if I am wrong, but I do not think that that includes fraud, where the Law Commission found that theft or attempted theft were the right charges against a person who uses a computer dishonestly to obtain money or other property. But if the person has not yet committed a further offence it may be difficult to sustain a prosecution for attempt. The Law Commission gives the example of the person who obtains access to a banking system

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and tries out passwords of depositors with a view to committing some financial offence. I agree with the noble Viscount, Lord Colville, that in many respects the Law Commission document is an admirable and lucid one, but in this regard I found it difficult to understand why such a person could not be charged with attempted theft. He would have committed the offence of obtaining unauthorised access to a computer with intent to steal under Clause 2.
The Law Commission goes on to give another example—of a person who intends to use, the information that he gains from unauthorised access to blackmail someone. He would not be guilty of an offence of an attempt to blackmail because his conduct was merely preparatory but he would be guilty of unauthorised access with intent to blackmail. From these examples I conclude that Parliament could have amended the law of attempt to create an additional offence of doing any act preparatory to the commission of an offence with intent to commit that offence. It seems to me to be wrong in principle to single out preparatory acts of one kind and make those into offences, while ignoring all others as the Bill has done.
The noble Viscount mentioned Clause 14 of the Bill, where he said that the police were asking for even more extensive powers of access than have already been granted. In fact there was a tacit agreement that in introducing the Bill the movers would not ask for greater powers of access, and there is no intention of doing so now. However, I would say to the noble Viscount, and through him to the police, that if they seek these powers they must make out a very good case for them and they will have to do that before Parliament would be willing to incorporate those powers in legislation.
The Law Commission's report was published in October 1989 and this legislation follows hard on its heels. The importance of protecting computer users and the public in general from criminal misuse is obvious. As customers of the banking system, as patients of the National Health Service, as airline passengers, shoppers, employees or electors, we all depend on the reliable working of computers, and any interference with them harms us as well as their operators. I hope that this Bill provides an effective deterrent to hackers and the perverted individuals who write and disseminate viruses. I fear that it does nothing of the kind, but merely creates an illusion of security which means that we fail to take every step possible for our own defence.
8.17 p.m.
Lord Milne: My Lords, I agree with the noble Lord, Lord Avebury, that the House should be grateful to the noble Viscount for introducing this Bill, which he ably explained, as he is so well qualified to do.
The influence of Scotland on our law was remarked upon in another place, for the need for such legislation was first recognised there. There must be some concern that a measure so clearly important to the business community and to computer users world wide should owe its origin to pure chance; I refer to the ballot for the Bill in another place. Whether it has suffered thereby is a
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matter of opinion. Besides the benefit of being taken up by the noble Viscount, it has obviously gained parliamentary time, since as a Public Bill we are led to understand that it would not have seen the light of day until the next Session at the earliest. However, time in this case is important because we are behind many countries in this respect.
Against that, although founded, as we heard, on the recommendations of the Law Commission report, the time factor prevented the addition of the usual model clauses—a matter which this House is probably well qualified to rectify. Whether a Public Bill or a Private Member's Bill, it seems to me that it was bound to be tentative, extending as it does the criminal law and police powers into new areas. It will surely be the forerunner of many such enactments in the future as technology and needs develop.
The need to strike a balance between the liberty of the subject and the rights of computer users was referred to by the noble Viscount. Computer users have the right to some protection. That came out clearly in the Committee discussions and I feel that the resulting Bill has been successful. Noble Lords who read the record of the stages in another place will be aware that the Bill has been extensively and expertly discussed; little has been left unresolved. I mention but two points.
First, I refer to the absence in the Bill of a definition of a computer. The need for that was strongly advanced in Committee but the definitions put forward proved faulty on technical grounds and it was thought better on the whole to leave it to the court. As regards the legal aspect, I cannot comment, but my more literate computer friends tell me that on technical grounds it is probably the right decision.
Finally, the question arose of whether computer users have a duty to protect the security of their equipment. Legally that is to some extent covered elsewhere—by the Data Protection Act for personal information and by the Companies Act for computerised accounts and so on. It is thought that the latter provisions may also cover the former. Certainly an unprotected computer on public lines is a menace both to the user and to others. To determined hackers it is simply an open door.
I agree that by now all users are aware of the risk they run and most act accordingly, as we have heard, but for those with outside connections the risks may be horrific. Absolute security is almost unattainable. Each user must balance the cost and the inconvenience against a realistic evaluation of the information contained therein. Held against that background, some deterrent and the powers of enforcement in this Bill seem not unreasonable even for Clause 1 offences.
With those remarks, I welcome the Bill and congratulate all those associated with it.
8.21 p.m.
Lord Williams of Elvel: My Lords, I do not propose to detain your Lordships for long because we have had some lengthy interventions on the Bill and it has been debated at considerable length in another place. The House is certainly grateful to the noble

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Viscount, Lord Colville, for sponsoring the Bill which started as a Private Member's Bill in another place, introduced by Mr. Michael Colvin.
I echo the views of the noble Lord, Lord Milne, that anyone who has read the debates in another place will recognise that the Bill was scrutinised with great care and expertise by a number of Members on all sides. Therefore, it is a rare pleasure from this Dispatch Box to welcome the Bill. I speak in my personal capacity because this is a Private Member's Bill and, as is the custom, I do not speak for my party. It is rare for me to be able to welcome a Bill that is so well drafted and, though complex, seems to put in place all the necessary measures that the authors of the Bill desired.
Looking through the Bill —1 have considered many Bills which have come before this House—I find that I cannot fault the drafting, and I congratulate the noble Viscount, Lord Colville, on that. I am not sure who his advisers were but I am sure that they should also be congratulated. As the noble Viscount said, there are problems which have grown up as a result of the use or misuse of computers. I echo the view expressed by the noble Lords, Lord Avebury and Lord Milne, that we need legislation on this subject.
Three doubts were expressed in another place which I echo rather than put forward as serious reservations. The first was addressed by the noble Lord, Lord Milne; it concerns the definition of a computer It is always difficult to decide whether to try to define in legislation the nature of the object about which we are legislating or whether to allow the courts to make that definition for Parliament. I believe that the Bill has probably got it right. I agree with the noble Lord, Lord Milne, that it is better to leave the definition to the courts. They can widen definitions that are left vague whereas Parliament, if it makes precise definitions, has enormous difficulty widening them because that requires amending legislation.
The second doubt aired in another place, which I must repeat, is the balance between civil liberties and proper regard to legality in the use or misuse of computers. I believe that, again, the Bill has got it about right. I have no serious complaints about the balance that has been struck.
The third doubt, to take up a remark of the noble Viscount, Lord Colville, in his introduction, is about enforcement. The noble Viscount rightly said that the Clause 14 arrangements introduce the notion of a circuit judge giving powers to search—not a justice of the peace as advocated in another place. I believe that that is about right. However one must recognise if one is to be fair that the whole question of enforcement has given rise to many comments and problems. No doubt in Committee in this place there will be further comment.
I do not wish to hold up the Scottish business which is to follow, but I have two problems, rather than doubts, in regard to the Bill. First, why was this not a government Bill? I join with the noble Lord, Lord Milne, in finding it odd that a matter studied at length by the Law Commission and which has
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been the subject of considerable consultation was not adopted by the Government and put forward as government business. My only consolation is that if it had been a government Bill it would have been introduced by the noble Lord, Lord Tregarne, and, on the evidence of the Landlord and Tenant (Licensed Premises) Bill, he is given to making commitments to this House which he is unable to fulfil. We might have had an endless series of discussions on why government commitments had not been fulfilled. Perhaps it is much better that the noble Viscount has introduced this as a Private Member's Bill because that denies the noble Lord, Lord Trefgarne, the opportunity of introducing all sorts of extraneous red herrings into the debates.
My second doubt on which I join with the noble Lord, Lord Avebury, is that technology is fast-moving. We are, so to speak, taking a photograph of this point in time and legislating now. I suspect that in one or two years' time there will be quite different developments of existing technologies which will require legislation to do what the noble Viscount proposes in the Bill. Although it is much against my normal judgment in these matters—if this were a government Bill I would certainly not accede to such a request —I wonder whether there is not sense in writing into the Bill a provision that under some secondary legislation, on some procedure which the House would determine, certain amendments might be made to the Bill without primary legislation having to come before the House. I believe that this is a case where technology is so fast moving that to bring forward primary legislation in the parliamentary time available might be extremely difficult. I take the point made by the noble Lord, Lord Avebury. There are many aspects which, in the light of experience, might well be reflected in the Bill but which at the moment we cannot foresee.
I put forward that proposal very tentatively to the noble Viscount. Normally I am a great defender—as I am bound to be from this Dispatch Box—of the rights of your Lordships' House to determine what legislation Parliament should or should not pass. However, here we have a example of a Bill which is fine at the moment but which may well need adjustment before future primary legislation can be brought forward.
Having said all that, I congratulate the noble Viscount for bringing forward the Bill and faithfully representing the opinions of his honourable friend Mr. Colvin who, in another place, performed with great expertise. I am sure the House is grateful to him. From this Dispatch Box I echo the words of my honourable friend Dr. Lewis Moonie in another place. It is time for legislation and we are glad to recommend it.
8.30 p.m.
Lord Trefgarne: My Lords, It may be helpful to your Lordships if I now briefly outline the government position on the Bill. The Government welcome and support this measure. I confirm the assessment of my noble friend Lord Colville of the serious threat represented by computer misuse. It is indeed a growing problem. The Government

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recognise that a legal framework must be put in place to deter such misuse sooner rather than later. We are pleased that an opportunity has arisen which allows for such a Bill to come before Parliament.
Perhaps at this point I may answer one of the questions raised by the noble Lord, Lord Williams, as to why it is not a government Bill. The fact is that the Law Commission reported only in October last year. As the noble Lord will know, it would not have been possible at that moment to have a Bill drafted and ready to be announced at the time of the opening of the new parliamentary session. That is why we were very happy that it was possible to bring this Bill forward.
Lord Williams of Elvel: My Lords, I am sorry to intervene. Not all Bills produced by the Government in this Session were adumbrated in the gracious Speech. It is perfectly possible for the Government to bring forward Bills that were not adumbrated in the gracious Speech.
Lord Trefgarne: My Lords, I was not claiming that it was necessary to bring it forward in the gracious Speech. However, given the timetable to which I have referred, it would have been difficult to have it properly drafted and into the government programme.
I am pleased to note that the Bill is based upon the recommendations of the Law Commission in its report published in October of last year. These recommendations received widespread support. They were also welcomed by the Secretary of State for Trade when in October last year he said that legislation should be brought forward when a suitable opportunity arose. That clearly was not going to be immediately. That is why this Bill is such a welcome opportunity.
I should like to pay tribute to the work of the Scottish Law Commission, which two years earlier than its English colleagues conducted a study into the need to introduce computer misuse legislation for Scotland. Its work has played a valuable part in the consideration of the relevant issues, and the greater part of this Bill applies to Scotland.
There are some examples of computer misuse which can be prosecuted under the existing law. The AIDS diskette which was circulated recently and referred to by the noble Lord, Lord Avebury, and my noble friend appears to be a case of blackmail. I understand that the police have charged someone in connection with this. However, the simple circulation of the infected disk would probably not have been prosecutable under any UK law had there not been an attempt to extort money. In other cases we have seen attempts to stretch the existing criminal law to cover mischiefs that it was never intended to address. That process is undesirable in principle and often unsuccessful in practice. The Bill will remove the necessity for it.
We agree with the Law Commission that there are three key areas where the criminal law is deficient or could usefully be strengthened. They have been ably described by my noble friend. We also agree with the Law Commission's conclusion that the
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inadequacies in the scope of the criminal and civil law require new legislation in the form proposed in this Bill. We therefore fully support its objectives.
The Bill also seeks to introduce new rules governing the jurisdiction of the United Kingdom courts. I should like to explain the Government's view on this.
We naturally look very carefully at any proposals to change the rules governing the authority of the courts. However, we consider that due to the particular nature of computer misuse, the Bill could not function effectively without this. Computer misuse knows no national boundaries. As my noble friend Lord Colville has explained, it can be carried out via the international communications network right across the world. These clauses are therefore an essential ingredient in the Bill and we support them too.
Laws against computer misuse are not sufficient on their own to deter this menace, in the same way as laws against burglary do not obviate the need for the wise householder to buy strong locks to protect his home. The Government recognise this and have developed a policy on other fronts which will complement this proposed law. That was a point raised by the noble Lord, Lord Avebury.
First, there is a responsibility on users to protect their systems adequately against intrusions. There is no doubt that users are now more aware of the threat of unauthorised access. Look at the support for this Bill. But this is not enough.
To raise awareness of the importance of computer security my department has launched a three-year awareness programme which is managed by the National Computing Centre. Aimed primarily at small and medium sized companies, the programme will highlight practical ways to protect the storage, transmission and display of information and will also emphasise the importance of technical standards. We would expect these measures to complement the introduction of this Bill and we will of course aim to explain the implications of the legislation.
Secondly, my department is active in the development of common technical standards for both products and systems. We have sponsored the development of criteria for the security evaluation of IT products. Together with other departments and partners in other counries we have also produced a set of European harmonised criteria which will be published for consultation shortly. We hope eventually to have full international harmonisation, supported by evaluation and certification. This will help users to meet their security needs with reliably tested products. We are also supporting a large amount of other standards work with broadly similar aims.
On the question of jurisdiction and extradition raised by the noble Lord, Lord Avebury, the jurisdiction provisions of the Bill would enable the gentleman who is alleged to have circulated the AIDS diskette to be tried in the United Kingdom for unauthorised modification. Clause 15 of the Bill makes the Clauses 2 and 3 offences extraditable, permitting extradition where appropriate treaties exist.

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The noble Lord also asked for an analysis of the computer misuse cases that have been referred to by the DTI. Of the six cases brought to prosecution all were within the realms of the Clause 3 offence; that is to say they were associated to some extent with criminal damage. However, the survey carried out by the DTI is not a statistically representative sample and we make no claim of that kind in respect of it.
As for asking police forces to report cases of computer misuse, I fear that this would likewise not produce valid figures. Where misuse is not a crime many cases will not be reported.
I believe that I have answered the first point raised by the noble Lord, Lord Williams, about why the Bill is not a government Bill. On his second point about the possibility of providing for changes of the Bill to cover future changes in technology by, for example, secondary legislation, I find it strange to hear such a proposition coming from the noble Lord. As he said, he did not think that he would make such a proposition with regard to any government legislation. I am not certain why he proposes such a course in connection with this Bill. He apparently wanted it to be a government Bill, I understand from an earlier intervention that he made. I dare say that he will wish to explore that point further at a subsequent stage.
Lord Williams of Elvel: My Lords, will the noble Lord recognise that there is a serious point here, frivolity apart? Technology advances. This industry and primary legislation passed through this House become out of date very quickly. I am trying to offer what I regard as an unsatisfactory formula. But it is a serious point.
Lord Trefgarne: My Lords, I recognise the point that the noble Lord makes. Of course technology advances in this area by leaps and bounds. But I am not sure that I favour the solution to the problem that he proposes.
The problem of computer misuse will not go away. This Bill's enactment, together with the efforts of computer users and continuing work on computer security awareness and standards, will provide a positive contribution to deterring computer misuse.
The Bill has successfully completed its passage in another place and received all-party support there. It has been debated and considered by right honourable and honourable Members in great depth and detail. The Government are content both with the objectives of the Bill and the way that they are achieved. I hope that noble Lords appreciate the need for such legislation and will facilitate its passage through this House.
8.38 p.m.
Viscount Colville of Culross: My Lords, we must not hold up the Scottish business very much longer. I do not very much mind whether it is a government Bill or a Private Member's Bill in view of the welcome that it has received from your Lordships this evening. That is the most important matter. I agree with the noble Lord, Lord Milne, that time was important in relation to the Law Commission's reports and we are seizing the opportunity to put the Bill on the statute book.
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The noble Lord, Lord Avebury, asked a number of very technical questions, in particular in relation to computer viruses originating from overseas. We are doing our best within the powers that we possess in the jurisdiction of all three parts of the United Kingdom. My noble friend Lord Trefgarne has already explained that Clause 15 deals with extradition. Of course extradition has recently been greatly brought up to date by the extradition legislation last year. The noble Lord may care to look at the double criminality test in Clause 8, which is also relevant in this respect.
We would be able to deal with these offences if they had advanced far enough to become, for instance, demanding money with menaces. The gap that the Bill is filling is the stage immediately before that. The noble Lord suggested that we might have another look at the possibility of dealing with the matter under the Criminal Damage Act. I looked at Cox V. Riley. It seemed to me that the courts were straining to bring what had happened there within the realm of that legislation. Once the courts start to strain, particularly if technology improves, we shall find very rapidly that prosecutions fail.
Lord Avebury: My Lords, does the noble Viscount happen to know whether other cases following Cox V. Riley have dealt with media more commonly in use such as floppy or hard disks? The case of Cox v. Riley was in 1986. One would have thought that, on the basis of damage having been caused to a plastic card, most of the more commonly used media might have been covered by existing legislation.
Viscount Colville of Culross: My Lords, I do not know offhand. I shall certainly find out and tell the noble Lord the result of my researches. That appears to be the limit reached by the courts under the Criminal Damage Act.
As for the Criminal Attempts Act and the possibility of making this a much broader issue in criminal law whereby preparatory acts in themselves would become attempts, the noble Lord is leading us into dangerous paths. It was precisely because they are only preparatory acts and not attempts that the Bill takes the form that it does. If we departed from long-standing arrangements and definitions of attempts so as for the first time to include preparatory acts, we should be bringing into the criminal law a large range of activities which at the moment stand outside it. Considering that the penalties for an attempt are the same as for the substantive offence, that is a major step to take and certainly not one that I would wish to embark upon simply in relation to computers and without a great deal more thought. The noble Lord may find that in the end it is better to deal with this in the specific way set out in Clause 2.
The noble Lord may also like to look, in terms of the way in which we are dealing with the introduction of overseas viruses, at the definition in Clause 17 (7) of causing a modification. He will see that we have arranged to take the exercise quite a long way down the stream of successive introductions of viruses. The noble Lord may care to study that.

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The noble Lords, Lord Milne and Lord Williams of Elvel, referred to technology and in particular to the definition of a computer. It is precisely because technology marches on so fast that it has been thought better not to include a definition of computer. That being the case, one needs to turn to the second point of the noble Lord, Lord Williams, which was dealt with to some extent by my noble friend Lord Trefgarne. The noble Lord asked whether we ought to take powers to keep ourselves up to date. I suggest that the drafting of this Bill and the formulation of these new criminal offences have been done broadly in a way which ought to take account of the technology as it progresses. I agree with my noble friend Lord Trefgarne that if one is dealing with serious criminal offences —the offences in Clauses 2 and 3 carry maximum sentences of five years in prison and an unlimited fine—it would be doubtful whether the wisdom of Parliament would allow this to be done by way of extending these criminal offences through secondary legislation Parliament likes to look at criminal offences of that seriousness before they go on to the statute book as primary legislation.
Lord Williams of Elvel: My Lords, I agree with the noble Viscount on that point. My problem is related to the definition. There are times when Parliament can rely on secondary legislation to extend definitions although the criminal procedure is enshrined in primary legislation.
Viscount Colville of Culross: My Lords, we can return to that in Committee. The provision in Clause 17 is a pretty cunning piece of work. I suspect that it will stand the test of time for a while at least. Of course if there are any further suggestions to improve it I shall be delighted to hear of them and to consider them most seriously.
It looks as though we shall have something to discuss in Committee. However, for the moment I am grateful for the welcome the Bill has received today. I commend it to the House.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Law Reform (Miscellaneous Provisions) (Scotland) Bill [H.L.]
8.45 p.m.
Consideration of amendments on Report resumed.
Lord Renton: My Lords, on a point of order, have we completed our consideration of Clause 21, as amended?
Noble Lords: Yes.
Clause 22 [Rights to conduct litigation and rights of audience]:
Lord McCluskey Lord McCluskey moved Amendment No. 133:
Page 28, line 41, at beginning insert ("Notwithstanding the terms of the Act of Union or of Article XIX of the Treaty of Union set forth therein").
The noble and learned Lord said: My Lords, those who attended the Committee proceedings or have read the report of them will be aware that I moved an amendment at that stage in the same terms as the amendment before us. However, it prefaced a clause which no longer exists. It was the old Clause 21, which has been replaced by what is now Clause 22. That was done at col. 1115 of the Official Report of 2nd April 1990. At that stage I quoted the most pertinent parts of Article XIX of the Treaty of Union. I did so at col. 1077 of the Committee stage proceedings on 29th March 1990. In short my submission to the House is that this Parliament has no power to alter the constitution or privileges of the Court of Session unless in the judgment of Parliament the proposed alteration would lead to the better administration of justice. I also make the point which I made in Committee that the Court of Session and the College of Justice appear to be the same thing.
In reply to certain points put forward on that occasion the noble and learned Lord the Lord Advocate said:
"Article XIX preserves the constitution, authority and privileges of the Court of Session following the Union. The clause, however, in providing for persons other than lawyers to obtain rights to conduct litigation and rights of audience in relation to court proceedings does not affect the constitution, authority or privileges as such of the Court of Session itself. —[Official Report, 29/3/90; col. 1078.]
In reply to a further question he said that the noble and learned Lord—referring to me—
"asked me one question which I do not think I have answered; namely, that about the members of the College of Justice. Yes, if they have rights of audience in the Court of Session, it would follow that they become members of the College of Justice". — [Official Report. 29/3/90; col. 1080.]
Following upon that, however, the noble and learned Lord wrote a letter on 11th May both to me and to the noble and learned Lord, Lord Emslie, in which he said:
"I have looked into this question by reference to the statutory authorities for the College of Justice and the Court of Session and have concluded that, while neither solicitors (except Writers to the Signet and Solicitors to the Supreme Courts) nor members of other professional bodies, would be members of the College of Justice this would not affect their right to exercise an acquired entitlement to appear in the Court of Session. I have found nothing in my researches which suggests that rights of audience flow from membership or that a right of audience may not be exercised without membership of the College [of Justice]."
Your Lordships will see that in the letter he contradicted what he informed the Committee on the occasion when, to be fair, he was asked the question and was perhaps not fully prepared to consider it.
The article to which I referred on that occasion was written by Professor Oswald Dykes just before the Second World War. It said:
"The College of Justice is the collective name given to those persons who take part in the administration of justice in the Court of Session."
It appears to me that what I said op that occasion about the College of Justice and the Court of Session was correct, and it appears to be clear that the Government are extremely confused about the position. It is obvious to me, and I hope now to your Lordships from the conflicting advice given to the Committee by the Lord Advocate and the conflict

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between that and what he said in the letter, that the Government had not thought deeply about this matter before it was raised in Committee.
Let me turn to the substance of the matter, which is that this Parliament is not entitled to alter the provisions in relation to the Court of Session or the College of Justice unless this Parliament considers that to do so will lead to the better administration of justice:. In that context, I have to ask a question that I have asked more than once before; namely, who asked for such rights, and, particularly in the criminal courts, who has sought such rights?
The Lord Advocate, replying to that on the previous occasion, said that the only group which had made a kind of tentative approach was a group of people concerned with adoption. That certainly indicates to me that no one has expressed any interest whatsoever in going into the criminal courts under the provisions of Clause 22. So how can it be said, when no one has asked for it and there has been no thought given as to who might take advantage of Clause 22, that it will be for the better administration of justice that laymen should be given these potential, unlimited rights of audience, especially in the High Court of Justiciary?
This Parliament must judge what is for the better administration of justice, because that is what Article XIX provides. It must not do so lightly. The Government must give reasons for changing the membership of the College of Justice, or the practice of the Court of Session and its privileges after some four and a half centuries. When we broke for dinner, I was reminded that 17th May will be the 458th anniversary of the foundation of the Court of Session. It appears to me chat it would be wise for the Government to take some time to think about what they are doing. It would be more honest for the Government simply to accept my amendment and acknowledge that they may well be in breach of the Act of Union and the Treaty of Union but say, "We don't care". The honest thing then would be to accept the amendment.
It could also avoid the difficulty that, when the first para-legal person is instructed to appear in the High Court, someone may argue before the Court of Session that what is now Clause 22, and will then be Section 22, is ultra vires because of the provision of the Act of Union. Then there would be what the Americans call a judicial review; namely, a court being asked to declare whether an Act of Parliament is ultra vires to the constitutional settlement.
I want to conclude by simply repeating the question that I have asked before in order to see whether there has been any progress in this matter. Are the Government now prepared to tell us which bodies the Government have in mind whose members can come to the court and plead in the criminal courts, and thus lead to the better administration of justice in Scotland? I have asked that question a number of times. I have others that relate to other parts of this clause; but, in the meantime, I am content with the questions that I have asked and hope that this time I shall get a satisfactory answer. I beg to move.
Lord Fraser of Carmylle: My Lords, I begin by attempting to clarify the relationship between the College of Justice and rights of audience in the Court of Session, as this matter has been raised on a number of occasions, particularly in Committee and again this evening. As the noble and learned Lord has been kind enough to say, I wrote to him to express what I now consider to be the best view that I can take of it.
I have concluded that while non-lawyers would not be excluded from membership of the college, they would not automatically become members by virtue of their acquisition of rights of audience to appear in the Supreme Courts. If I got it slightly wrong last time, I regret that. However, looking at it again—and looking to the case of Bruce v. Clyne—I am not entirely surprised that it has caused difficulty for some people to determine whether or not such groups as the solicitors of the Supreme Courts have, since the early part of the 19th century, been members of the College of Justice. It is far from clear from that case what the situation is.
However, those non-lawyers would not be barred from membership of the College of Justice so far as I can ascertain. Indeed that membership of the college might be acquired either by act of sederunt or indeed, from the Clyne case, by usage. I think solicitors to the Supreme Courts come into the second category, although I think that may be underlined by the fact that they are also members of the College of Justice, and by what I have been advised by the previous Lord President, the noble and learned Lord, Lord Emslie, that they are members of the College of Justice by virtue of an act of sederunt.
The principal point that I want to make to the noble and learned Lord, given his concern about the membership of the college, is that it does not appear to me that there is a direct link between such membership and the acquisition of rights of audience under statute. For example, all solicitors—not just those who might be granted extended rights of audience under the provisions of Clause 21 —have a limited right of audience before the vacation judge (and I accept that it is limited) in the Court of Session in terms of Section 48 of the Court of Session Act 1988. I would have to say that I have not heard it suggested that because they are mere solicitors rather than members of the College of Justice they should not have those limited rights of audience. Only certain solicitors—namely. Writers to the Signet and Solicitors of the Supreme Courts—are members of the College of Justice. I do not think that there can be any doubt about that.
It would confuse the issue to equate the college with rights of audience in the Court of Session. That being so, in my view it does not help a consideration of the issue to try to draw the two together. In promoting what the Government are now promoting, I have to say to the noble and learned Lord that I do not consider that there is a question of any conflict with the provisions of Article XIX of the Treaty of Union. If there is at some point in the future any attack or challenge on that, so be it. We shall have to live with it. However, from the researches that I have undertaken, I do not think that there is a direct relationship; and the position

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about the colleges is nothing like as crystal clear as is sometimes suggested.
The other matter that he raised was: who has asked for rights of audience, particularly in relation to criminal matters in the High Court of Justiciary in Scotland? I have said it to him before, and he has repeated it in the course of what he said, that such application has not been made, and it may well be that no application is made. But I am sure that during his time as a law officer of the Crown there were occasions on which he introduced provisions that were essentially enabling. That is all that is being provided for here.
The Government are not compelling non-laywers to come forward and put together a scheme to give them rights of audience in criminal matters. The enabling provision will be there. I emphasise this, as I have emphasised it on a number of occasions previously. Although the noble and learned Lord has used the crisp terms, the barefoot lawyers, (which articulates his thoughts on the matter) with respect, that is not wholly apposite, because if any group comes forward, the provision will be put tightly within the control of the senior judge in Scotland and the senior member of the Government in Scotland; namely, the Secretary of State.
There is a world of difference between the early American experience of the barefoot lawyer and what we propose. The provision is an enabling one. The noble and learned Lord may well challenge the Government and ask who is coming forward at the moment. There is no immediate group, but we wish the provision to be on the statute book, subject to the sternest of arrangements as to education and so forth; and in those circumstances, I invite the noble and learned Lord to withdraw the amendment.
9 p.m.
Lord McCluskey: My Lords, the noble and learned Lord the Lord Advocate has said that the questions raised in connection with the amendment are difficult, and that it is far from surprising that they have caused difficulties. They might have caused difficulties to the rest of us, but they should not have caused difficulties to the Government because the Government should have reflected upon the impact of the Bill upon Article XIX before the Committee discussed the matter and I tabled the amendment referring to it.
The noble and learned Lord the Lord Advocate has also said that all solicitors have a limited right of audience before the vacation judge. That is true. One can understand that it may well be for the better administration of justice that during the vacation a solicitor who knows the case should be entitled to deal with the essentially interlocutory matters which are dealt with there. I do not criticise solicitors. I make that plain. I have a high regard for the advocacy skills of a great many solicitors of my acquaintance. One can easily understand the judgment that there was no problem about the better administration of justice when all solicitors were given the right to appear in the vacation court.
On the final point, the noble and learned Lord the Lord Advocate has said that this is merely an
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enabling provision which will enable something to happen which may never happen. We have no idea who wants it to happen. We do not want it to happen. No one wants it to happen. If in the future someone wants it to happen, the provision will exist to enable it to happen. One could understand that in some looking-glass world; but how can it be said to be for the better administration of justice in the Court of Session to put into the Bill such a provision when the Government cannot point to anyone who has asked for it or who should have it? One cannot persuade Parliament that that provision is for the better administration of justice when the Government's reply is, "It is just there so that in some future that we cannot comprehend someone might, in circumstances that we do not understand, ask for something that no one wants". In substance, that is what the Government's reply comes to.
I hope that between now and a later stage in the Bill—this is going to another place where I have no doubt it will be examined critically—the Government will have reconsidered their position. The Government have already made it plain that the clause is not to be brought into force immediately. One hopes that it may not be brought into force for a long time, if ever. The honest thing to do—I am sure that the Government will make many friends and make much more sense of the Bill—would be for the Government to abandon Clause 22 unless they have some scheme in mind, in which event they should come forward with a clause that enables that scheme to be put in force.
I remind your Lordships of what I informed the Committee. When the present Lord Chancellor was Dean of Faculty he thought that lay representation, even in the lowest courts, could be a threat to the better administration of justice. That was a judgment which was carefully considered. It was put into the written documents that went to the Royal Commission and it was repeated at the Royal Commission's oral hearings. In those circumstances, the Government would be wise not to press ahead with the matter. However, in the circumstances, and so as not to delay matters tonight, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey moved Amendment No. 134:
Page 28, line 41, leave out ("or other").
The noble and learned Lord said: My Lords, Amendment No. 134 is again an echo of something that happened in Committee. Your Lordships will see that it seeks to leave out the words "or other" on page 28 at line 41. The provision contained at the beginning of Clause 22 is that,
"Any professional or other body may, for the purpose of enabling any of their members … to acquire —

(a) rights to conduct litigation … and

(b) rights of audience,

make application in that regard".
No one knows what bodies, apart from professional bodies, the Government have in mind in relation to this matter. I can understand, although I do not agree, the thinking behind the proposal that patent agents, accountants, architects, surveyors or other such bodies might wish in certain circumstances to

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exercise a right of audience. But which bodies other than professional bodies do the Government have in mind?
There is another point which is a technical one. I am sorry that the noble Earl, Lord Balfour, is not here to congratulate me on pointing it out. If "other" means "any other", as it appears to do, then why does not the Bill just say "any body may apply"? The words:
"Any professional or other body",
mean any body at all. The noble Lord, Lord Grimond, made that point in Committee.
The amendment is a small one, but it takes a tiny step towards sanity by providing the potential to apply, a: least initially, to professional bodies. If it is a howling success to the astonishment of all and sundry, including myself, then one could in another Law Reform (Miscellaneous Provisions) Bill—they come along every year or so—extend the right to bodies other than professional bodies. However, in moving the amendment I ask the noble and learned Lord the Lord Advocate on behalf of the Government to give me a clear reply to the question: which body other than professional bodies do the Government have in mind? In particular, which body other than any professional body do the Government have in mind to which they will accord rights of audience in the criminal courts? I beg to move.
Lord Macaulay of Bragar: My Lords, will the noble and learned Lord the Lord Advocate, in reply, give an indication as to whether any further thought has been given to the definition of "professional"? In times past the professions were easily recognised as being the ministry, medicine, law and so on. However all kinds of people—and I say that in no disrespectful sense—various categories of workmen, call themselves professionals. A plumber is quite entitled to call himself a professional plumber, and he is indeed a professional when one is in trouble, if one's house is flooded. There are publicans in the licensed trade, which is called a profession.
Would not the absence of a definition in the clause of "professional" give considerable force to the argument advanced by the noble and learned Lord, Lord McCluskey? It might be better to have an open house rather than a half-closed one as with the present working of the laws.
Lord Cameron of Lochbroom: My Lords, I take a somewhat different view about the clause from that which was adumbrated by the noble and learned Lord, Lard McCluskey. We tend to forget that in many legal proceedings within our jurisdiction lay persons represent other lay persons successfully. They make use of their own training, which includes law. It might be said that there is a case for allowing representation, for instance, within the lowest courts—the courts, as opposed to tribunals. I instance the district courts. It may well be said that if in a court martial a defendant can be represented by his divisional commanding officer, there is no reason why, within a limited tier of courts, the same principle should not apply.
The noble and learned Lord will be well aware of what happens in industrial tribunals where it is
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not members of a body who necessarily represent individuals. Nevertheless, trade union officials would certainly be members of a body and they have been very successful in that regard. In social security tribunals I can think of officers employed by the administrations of local authorities who have been successful in representing cases on behalf of individual litigants.
It might be said that the clause does not go far enough. It provides that it must be a body that makes applications. In addition, the restrictions are then further and, I am bound to say, properly restricted by the terms of subsection (2). It provides for restrictions as to the nature of the courts, the nature of the proceedings and of the business and so on which the members of that body—be it professional or otherwise —can attend. Paragraph (b) of the clause provides for the necessary training requirements and paragraph (c) for indemnification. What indemnification is there, for instance, for the litigant who goes before a social security tribunal or, in one sense, a trade union member who goes before an industrial tribunal and is represented by his official?
It is proper that we should take a much broader view of the clause and what it seeks to do in a restricted way. In the law of Scotland that is the way we ought to go. I have a great deal of time for lawyers, as noble Lords will understand. I have spent over 30 years among them and recognise the expertise on both sides of the profession. However, sometimes within a profession we tend to forget that similar legal expertise is available to those who practise their jobs in ways which from time to time touch the law.
It is for the good of the courts that we should have this provision which may in time to come assist ordinary litigants in a way which at present we are in danger of losing. Therefore, for the moment, I am not persuaded by the arguments which my noble and learned friend has put forward.
Lord Morton of Shuna: My Lords, my noble and learned friend Lord Cameron of Lochbroom has expressed his views about rights of audience. I did not mean to speak on this issue; but, having been a member of various tribunals, on the whole, I disagree with him. Courts are totally different from tribunals, which tend to be very specialised. I have been involved in industrial tribunals and in the Criminal Injuries Compensation Board. Various disasters have been averted only through the expertise of the members of the tribunal rather than that of the person who is appearing. We must be very careful that in widening the rights of audience we do not water down the quality of the advice that is available to a person who is appearing in a court which is, after all, by its definition, intended to be more serious than a tribunal. The latter concerns a specialised area.
9.15 p.m.
Lord Fraser of Carmyllie: My Lords, in my view this amendment is unnecessarily restrictive. If the noble and learned Lord, Lord McCluskey, wished to open an attack upon the first line of Clause 22 he might reasonably have done so by saying that the words "professional or other" should be deleted so that the clause simply stated, "Any body may, for

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the purpose of enabling any of their members who is a natural person to acquire".
I should understand that argument. Nevertheless, I think it is desirable that we should give some signal that we are not talking about individuals coming forward, but rather about bodies which have members who are natural persons coming forward. The noble and learned Lord, Lord Cameron, referred to that matter.
However, as I understand it, that point did not amount to the substance of the complaint of the noble and learned Lord. He believes that, if there is to be a broadening of those who have rights of audience, the extension should be to those who are in what might be described as a profession. The noble Lord, Lord Macaulay, is quite right to say that the term "profession" is capable of the widest use. Those who patrol the streets late at night could sometimes describe themselves as being in a profession. That term is clearly difficult when it comes to giving it any precise legal containment.
However, there may well be groups of persons who are not professionals in a generally accepted sense but who may be able to offer a useful service of a requisite quality to clients with particular needs. I am thinking here in particular of persons who work in the advisory field—for example, on welfare or benefit matters. I was surprised that the noble and learned Lord, Lord Morton, was so disparaging of some representatives of trade unions who have appeared against me in industrial tribunals. Given the antecedents of the noble and learned Lord and given mine, it is surprising that I am the one who is defending those members of trade unions who have on occasions done a quite outstanding job and who have displayed a great expertise not only in practical matters coming before the tribunal but also in an enormously detailed knowledge of the law in a particular area.
I have already indicated that there has been no direct notification that there are specific groups who are straining at the leash to acquire rights of audience. However, I have mentioned in the past that such groups as those who are involved in adoption matters could offer the most invaluable rights of audience in a specialist area. Adoption should, I believe, come before the courts but I doubt whether the people who deal with adoption matters would necessarily be described as professionals although they may have great expertise in that area. However, the point ultimately is—I have made this point before—that it will be for the Lord President and the Secretary of State to judge on its own merits each application for rights to conduct litigation or rights of audience under this clause. The noble and learned Lord, Lord Cameron, referred to that matter. The provisions which enable the Secretary of State and the Lord President to do so are detailed and extensive. Indeed, if the noble and learned Lord, Lord McCluskey, were to make the criticism that they are too detailed and too extensive, I should be inclined to accept that criticism in some circumstances.
Lord McCluskey: My Lords, the noble and learned Lord the Lord Advocate, with the assistance of my
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noble and learned friend Lord Cameron of Lochbroom, has repeated the point which had been made before —that is, that there is a case to be made for the opening up of the lowest district courts such as the courts martial and the tribunals that were mentioned by the noble and learned Lord, Lord Cameron, and possibly the summary civil courts that deal with matters of adoption, to persons who have expertise in those matters. I can understand that proposal although, as I have already said, it goes in the teeth of what the noble and learned Lord the Lord Chancellor said when he was the Dean of the Faculty of Advocates. However, that point does not justify this clause. The noble and learned Lord the Lord Advocate obviously did not hear me suggest that the logic of the wording of Clause 22 was to delete the words "professional or other" to make it refer to any body.
I have not yet heard an answer to the deep question to which I am seeking an answer—namely, under what circumstances would some body other than a professional body have any reasonable expectation of making a successful application to the Lord President and the Secretary of State for the right to represent people in murder cases, rape cases and the like in the High Court of Justiciary before a jury? In the hope of receiving an answer to that question when I come to a later amendment, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey moved Amendment No. 135:
Page 28, line 43, leave out ("members of the public") and insert ("other members of that body").
The noble and learned Lord said: My Lords, I do not want to take a great deal of time over this amendment. It is a damage limitation exercise. It may be that members of whatever body we have in mind can properly assess the competence of the authorised pleaders who are authorised by that body in terms of a scheme. The public may see a surveyor as a good surveyor, an architect as a good architect, a plumber as a good plumber or a boy scout as a good boy scout, but they cannot judge which of them will be good at advocacy in the courts.
Again I ask in this connection whether any member of the public has ever, before or since the Bill was published, asked the Government to ask Parliament to confer rights of this kind upon non-lawyers. I should like to hear from the noble and learned Lord the Lord Advocate more explicitly what it is that some persons concerned with adoption have said. I should like to know whether representations have been made to the Government on behalf of some body which properly represents those concerned with adoption law that they should be given a right of audience. I do not know the answer to that question yet. In the hope that I shall receive one, I beg to move the amendment.
Lord Fraser of Carmyllie: My Lords, the noble and learned Lord has an optimism which at this time of night surprises me. He has asked me that question repeatedly. I can do no better than repeat again that, while I instanced an adoption matter and he has instanced patent agents, I did not suggest at Committee stage, and I do not suggest at this stage,

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that there is a list of professional or other bodies which are straining at the leash to acquire these rights of audience. The provisions are essentially enabling They cover all courts. It might be that only the most restricted rights of audience in the most restricted matters would be requested. I do not believe that I can expand on that point.
If the amendment were to be carried it would be very restrictive. It would allow persons acquiring rights of audience the right to conduct litigation only for other members of the same body. That would defeat the purpose of the clause, which is to enable persons of requisite qualifications, experience and competence to offer litigation and representative services to the public.
Lord McCluskey: My Lords, I have nothing to add. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 136 and 137 not moved.]
Lord McCluskey Lord McCluskey moved Amendment No. 138:
Page 29, line 8, at end insert:
("(v) what is to happen if in the course of the proceedings there are raised matters of law in relation to which neither membership of such a body nor the training referred to in paragaph (b) hereof confers any knowledge or expertise,").
The noble and learned Lord said: My Lords, noble Lords wi11 recognise the amendment. When the noble and learned Lord the Lord Advocate saw it at Committee he thought that it was defective because it did net have a question mark at the end. I trust that he has had time to reflect upon that and realise that it would have been quite improper to put a question mark at the end. Perhaps he simply misread the amendment at that time.
In Scotland, advocates who appear in any court and solicitors who appear in any court in which they currently enjoy a right of audience profess a knowledge of the whole law that might bear upon the case in which they are involved. More particularly, they profess a knowledge of all the procedure and practice in that court and a knowledge of the law of evidence as it might bear upon the case in which they are involved, in addition to surrounding areas of the law. I do not pretend that every lawyer, be he advocate or solicitor, knows everything, but all profess a knowledge of the law and are trained in the whole law in the course of their years at university and of their apprenticeship and devilling.
The lay pleader makes no such general profession of knowledge. The scheme should therefore contain provisions which the Lord President can consider about:
"what is to happen if in the course of the proceedings there are raised matters of law in relation to which neither membership of such a body nor the training referred to in paragraph (b) hereof confers any knowledge or expertise".
If you empower a patent agent, an insolvency practitioner or an architect to appear in a case, and another party—whether it be the other side or a third party who has come into the case or someone else—raises a question which is not within his expertise, what on earth is to happen?
More particularly, in a criminal case, if one of those lay pleaders—the barefoot pleaders as I previously referred to them—is defending a person on a charge and the case expands in some way to embrace matters on which he is not expert affecting another person who is charged, who is to protect the interests of that other person against the incompetence of the lay pleader who has been taken outwith the field in which he has expertise?
I suspect that the Government have not thought deeply about those matters. I have tabled the amendment because it appears to me that someone should think about what happens when the lay pleader is suddenly found to be out of his depth because of a twist or turn in the case which he did not foresee. I beg to move.
Lord Morton of Shuna: My Lords, I support the amendment. The scheme should specify the category of proceedings and the nature of the business. That is all very well. You categorise that person so that he is allowed to deal with, for example, certain types of patent applications. However, as my noble and learned friend said, what happens if the case jumps from that to a matter concerning something different? At various times in practice we have all found that a totally different branch of law has suddenly appeared in the case that we are conducting. We have to deal with it. What is to happen to the person who suddenly finds that the case has moved out of the category in which he has a right of audience? The Bill is completely blank in that respect. Is he to say to his client, "I am sorry. At the moment I have to stay silent and there is nothing you can do"? That matter must be considered.
Lord Fraser of Carmyllie: My Lords, when this self-same amendment came before the House last time and I indicated that it might end with a question mark, I was as appreciative as the noble and learned Lord is of the fact that question marks do not appear on the face of a statute.
The reality of the law—not just in Scotland, but throughout the developed world—is that it has become increasingly specialised. Although particularly in Scotland we rightly lay claim to the advantage of a common core of education, few of us would claim to be truly expert or specialist in all the areas of the law that now come before the courts in our complicated society.
I understand and appreciate that, as the noble and learned Lord, Lord Morton, said, there may well be occasions on which the pleader would not claim to have any particular expertise or knowledge. That happens now and it may well happen in the future. I should have thought that in such circumstances, if there is a specialist Clause 22 pleader, he would take the steps that I envisage a junior member of the Bar would take at present. He would seek an adjournment or make some proposal for securing the services of someone who was a specialist in the field in which he would not claim to have expertise. It is a problem but it is one which arises in the medical world and with all kinds of other professions. It is not exclusively a legal problem. In such circumstances the proper response, whether

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one is already enjoying rights of audience of not, is to appreciate the limitations of one's expertise and take steps to secure the expertise of someone who will be able to give the advice that the client requires.
9.30 p.m.
Lord McCluskey: My Lords, I shall not dwell any longer on this matter. The position in Scotland is different from that in England. In Scotland we profess the whole law. We do not divide ourselves into chancery lawyers, common pleas lawyers and so on. Nowadays there is a tendency for some people to specialise in the criminal law and others to stay out of it. Certainly any advocate of my acquaintance would be able to profess the law in any field in which he was likely to be instructed. In one sense he would not be taken by surprise by developments in a case.
However, I do not propose to push this matter. In my experience of over 30 years I have never known counsel to ask for an adjournment of a case in order to bring in an expert to tell him what is the law. It is so laughable that it would never happen. I am surprised to hear the noble and learned Lord the Lord Advocate espousing such a curious notion. He must have found it in his notes and they must have been written by someone who has perhaps never appeared in a court of law. However, at this late hour I do not propose to press the matter. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey moved Amendment No. 139:
Page 29, line 17, leave out ("application") and insert ("application's").
The noble and learned Lord said: My Lords, I suspect that some noble Lords may imagine that I am guilty of pedantry here. However, as a matter of syntax, the words "being granted" constitute a verbal noun, the gerund. Therefore, line 17 could read,
"in the event of the granting of the application".
A "granting" would then be a verbal noun and the word "application" would be in the possessive form. The Bill does not put the word "application" in the possessive and it makes "being" into a gerundive.
Having said that, and at the risk of being accused of pedantry, perhaps I may explain. In a recent case involving Section 4 of the Misuse of Drugs Act the court has interpreted the section in a certain sense. It has made the mistake, in my opinion, of not distinguishing between the gerund and the gerundive. That has led to a wrong view of what the section contains. It is not a point of pure pedantry. It is desirable that when the statute is being drafted by highly expert draftsmen they should stick with the syntax with which we are all familiar. Accordingly, at the risk of being accused of pedantry, I beg to move the amendment.
Lord Fraser of Carmyllie: My Lords, in view of the nice compliment that the noble and learned Lord paid to me as regards an earlier amendment for the way in which it was constructed, with some regret I say that I cannot see what this amendment will add to the sense of the clause. The clause seems to make perfectly good sense as it is. It has been drafted with the standard practice in such matters very much in
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mind. I should be very reluctant to depart from that without some clear advantage. In view of the other matters that we have to consider, I invite the noble and learned Lord to withdraw the amendment.
Lord McCluskey: My Lords, I certainly shall. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey moved Amendment No. 140:
Page 29, line 26, at end insert:
("(d) prescribing that no person shall be given a right of audience in terms of this section in any Court unless the Lord President is satisfied that he is a fit and proper person to have such a right of audience.").
The noble and learned Lord said: My Lords, Amendment No. 140 covers some of the ground covered in Amendment No. 154 standing in the name of the noble and learned Lord the Lord Advocate. Amendment No. 140 requires that certain rules referred to in the clause should prescribe that:
"no person shall be given the right of audience in terms of this section in any Court unless the Lord President is satisfied that he is a fit and proper person to have such a right of audience".
Therefore, it is proposed that the Lord President should determine who passes the fit and proper person test. Amendment No. 154 would place that responsibility not upon the Lord President but upon the body of which the person is a member. It is obvious that the person to decide the matter is the Lord President or, wearing his criminal hat, the Lord Justice General.
It can be done. I may be told that if the Lord President must look at each individual case that is a huge responsibility. However, I read a recent lecture given by the Lord Chancellor in the SSC Library in Edinburgh. Among his many duties and responsibilities he listed that of studying personally each year the applications of several hundred people to be elevated to the rank of Queen's Counsel and become Silks in England. He said that he read each of them and made sure that each passed the fit and proper person test.
I believe that the job should be that of the Lord President. It should not be put upon the body. I take the opportunity of saying that for that reason I am opposed to Amendment No 154 and believe that the better course is Amendment No. 140. I beg to move.
Lord Fraser of Carmyllie: My Lords, while I understand the thinking behind the amendment, the noble and learned Lord will appreciate the fact that, given my amendment to which he has referred, I cannot accept it. The Lord President will under the terms of Clause 22 consider and approve a draft scheme submitted by a professional or other body wishing to accord rights to conduct litigation or rights of audience to its members. Notwithstanding what the noble and learned Lord has said, it would be inappropriate and impractical to expect him to consider whether each individual is a fit and proper person to undertake the work involved. In my view, that task is best undertaken by the body concerned and my Amendment No. 154 seeks to achieve that.
At the risk of repeating myself, I must point out that the body may wish to deal with a restricted area of work in one of the inferior courts. In such

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circumstances it would be a startling proposition if the Lord. President of the Court of Session, who has a heavy enough workload, had to scrutinise each application. However, it would be important for him to set up the scheme. In doing so, as we have already discussed, there are codes of practice, training requirements and so forth. I accept the fact that it is entirely appropriate for the Lord President to exercise that broader control. It appears to be sufficient without requiring of him a direct involvement with the individuals who are members of the body seeking rights of audience.
Lord McCluskey: My Lords, I had anticipated the noble and learned Lord's remarks by saying that the Lord Chancellor undertook a task not dissimilar. If it is practicable for him to do that—and he has other enormous responsibilities in relation to the appointment of judges and so forth—it must be practicable for the Lord President to scrutinise these cases. If people are to appear in the Court of Session and in the High Court of Justiciary, as the clause permits, the Lord President should determine whether they pass the test.
I do not propose to divide the House. I know that all our proceedings will be studied with care by those in another place. I hope that the Government will give further thought to the matter and change their mind, as they have been good enough to do on a number of other points. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 141:
Page 29, line 31, at end insert ("; and shall in particular include provision enabling the body to comply with the provisions of subsection (13A) below.").
The noble and learned Lord said: My Lords, I shall speak also to Amendments Nos. 147, 154 and 157. I believe these amendments will be welcome to the House. They reproduce for non-lawyers seeking to acquire practising rights under Clause 22 certain important obligations and duties which attach to solicitors. It is not my intention, however, simply to force any person who acquires practising rights under this clause to become, to all intents and purposes, a solicitor, an intention which would in any event be practically unachievable. As I explained in Committee, I would expect those who avail themselves of such practising rights to be very much niche practitioners. Nevertheless, it is important that the fundamental principles which ensure that standards of conduct and practice are maintained before the Scottish courts are common to all those who seek to appear before them.
The third of these amendments requires the body in question to apply a fit and proper test, which we have just discussed. The last amendment provides the body with a power of suspension in the last resort, parallelling the power available to the Council of the Law Society of Scotland in connection with solicitors with supreme court rights of audience against whom a complaint of professional misconduct is made in the supreme courts, but enables the body to exercise it in all courts and
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circumstances. I think this is necessary since it is impossible to foresee the circumstances which may arise in which the body sees the need to act quickly. Moreover, the body is required to exercise this power on the request of the Lord President who must remain the supreme arbiter in these matters.
With an eye to the future, the amendment also requires the code of practice to establish an order of precedence between different courts comparable to that which binds solicitors with supreme court rights of audience. This will ensure, in particular, that the legendary level playing field obtains between non-lawyer practitioners and solicitors and advocates. The level playing field is one aspect. The other is, of course, the more important; namely, ensuring that the client is, as far as possible, able to secure representation by the type of practitioner he needs and wants. I believe these amendments provide for a necessary coherence between the different categories of practitioner envisaged, in due course, by the Bill. I beg to move.
Lord McCluskey: My Lords, as the noble and learned Lord the Lord Advocate pointed out, the amendment introduces subsection (13A) which is to be found set out in Amendment No. 157.
I draw attention to certain aspects of the matter. First, in subsection (13B) the provision is to the effect that the code of practice shall include rules:
"stating general criteria to which members of the body should have regard in determining whether to accept instructions in particular circumstances".
Again, I raise the point which did not find favour earlier with some noble Lords. I am not sure what it means to accept instructions in these circumstances and I am not sure how it is to be determined that instructions have been given.
Secondly, in relation to the rule referred to in paragraph (a) the body is to establish the order of precedence of courts for the purposes of this subsection. As my noble and learned friend Lord Morton of Shuna argued, if it is inappropriate for the Council of the Law Society to establish the order of precedence of courts, surely it is even more inappropriate for the fire brigade union or whichever body the Government have in mind to do so. Why should such a body establish the order of precedence?
Paragraph (c) states that the rules shall secure:
"through such of their officers as they think appropriate, that, where possible, any person wishing to be represented before any court by one of their members holding an appropriate right of audience is so represented".
That is a nonsensical provision. It is there to mirror the provision which applies to solicitors in the preceding clause. However, it is absolutely absurd that a patent agent must have a rule to the effect that if somebody requires the services of a patent agent, he must have a patent agent wherever he may come from, if that is possible. That is absurd; yet it is entirely logical. Therefore, if by applying remorseless logic one ends up with a silly conclusion, you are driven to the opinion that the premises must themselves be silly. Of course, that was where we came in. The premises are silly. By their fruits ye shall know them. That is one of the fruits of this

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clause which is absurd. The Government should think again about that.
On Question, amendment agreed to.
9.45 p.m.
The Deputy Speaker (Lord Airedale): My Lords, in calling Amendment No. 142 I have to say that if it were agreed to I could not call Amendment No. 143.
Lord McCluskey Lord McCluskey moved Amendment No. 142:
Page 29, line 32, leave out subsection (4).
The noble and learned Lord said: My Lords, Amendment No. 142 seeks to leave out subsection (4), which is to be found on page 29 of the Bill. It is the subsection which provides that:
"A draft scheme submitted under this section shall also include the proposals of the body in relation to such other matters as may be prescribed by the Secretary of State in regulations made under this section".
That is all it says. That is a pure Henry VIII clause. I have no idea what the Secretary of State has in mind to put into such regulations. Perhaps the noble and learned Lord the Lord Advocate can enlighten us. Can he say whether such rules and regulations exist in draft and, if so, what they contain? When in any event are they to be published? Is anyone to be consulted before this rule and regulation is brought before this House, if it is brought before the House, under the negative procedure?
As the Deputy Speaker pointed out, Amendment No. 143 cannot be taken if Amendment No. 142 is agreed to. Amendment No. 143 provides for a weaker position; if fresh regulations have to be made about vague other matters, I should have thought it appropriate that they should be made by the court, not by the Secretary of State. That is the thinking behind that amendment and I shall not speak to it separately. I beg to move Amendment No. 142.
Lord Fraser of Carmyllie: My Lords, the list of matters to be included in a draft scheme is not exhaustive. It is important that the Secretary of State should have a long stop power to add further requirements should circumstances develop which demand that. I cannot accept that the Lord President would be an appropriate person to exercise that task since the breadth of his responsibilities cannot be compared with those of the Secretary of State. I doubt whether his perspective would fully qualify him to deal with all the matters which a draft scheme will be required to cover. I am thinking specifically of the requirements which relate to client protection and complaints. I emphasise that it is as a long stop provision that this power is sought to be given to the Secretary of State.
The noble and learned Lord made reference to a Henry VIII type of clause. However, he will appreciate that if the Secretary of State is to make further regulations, it will be in precisely the direction that he would want the Secretary of State to go; namely, that there should be a greater restriction on those persons who might seek to acquire rights of audience under Clause 22 rather than providing for a greater enabling opportunity.
Lord McCluskey: I have nothing further to say. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 143 not moved.]
Lord Macaulay of Bragar Lord Macaulay of Bragar moved Amendment No. 144:
Page 29, line 35, at end insert:
("(4A) The Secretary of State shall by regulations made under this section make provision —

(a) requiring applications under subsection (1) above to be advertised;

(b) for draft schemes to be published or otherwise made available for inspection by members of the public; and

(c) for the making and consideration of objections or representations by members of the public or interested bodies.").

The noble Lord said: My Lords, this amendment requires the Secretary of State, by regulation, to make provision requiring applications for this type of pleading to be advertised and a draft scheme to be published or otherwise made available for inspection by members of the public. It also provides for the making and consideration of objections and representations by members of the public or interested bodies. Amendment No. 148 is an associated amendment and will follow if Amendment No. 144 is accepted and included in the Bill.
The purpose of the amendment is self-evident and I do not need to go into it in any detail. It is basically to provide publicity of any draft scheme. It will give the public, who, after all, will be affected by the implementation of the scheme in the courts where successful applications are made, an opportunity to see who is getting, or may be likely to get, approval to practise in whatever court and to make objections to or indeed to approve of, as the case may be, the objects of the particular scheme.
It is clear that this provision covers an entirely new area of legal practice, involving public rights in this new field, and it is essential that in the public interest the public should know what is being done on their behalf in the courts. I beg to move.
Lord McCluskey: My Lords, I support this amendment. There should be some room for input by the public. For example, the police might wish to input some information about specific bodies and schemes. Members of the public who have had unsatisfactory dealings with the body or the members that it is proposed to enfranchise in this way might well have something to say. Indeed, advocates, solicitors and Members of Parliament might want to make representations on a particular scheme. Therefore, I urge the Government to consider this amendment positively.
Lord Fraser of Carmyllie: My Lords, I am grateful to noble and learned Lords for raising this matter again. As I indicated in Committee, I am sympathetic to the thinking behind this amendment. I have to say, however, that I do not think a further regulation-making power for the Secretary of State is either necessary or appropriate to achieve what is needed here. Given the recent criticism that some have made of this Bill, that it gives too many powers

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in secondary legislation to the Secretary of State, I am sure that that sentiment will be welcomed by some noble Lords at least.
I am conscious of the fact that I undertook to give consideration to this topic at Committee stage, but it has proved to be a less simple task than I imagined at the time. While I apologise, therefore, for not having a finished amendment to put before the House, it may be helpful if I outline the Government's intention in this area. I envisage that an amendment will be brought forward in another place to require applicant bodies to make copies of their application for practising rights under Clause 22 pubicly available and to require the Lord President and the Secretary of State to give consideration to objections for representations of the kind mentioned by the noble and learned Lord, Lord McCluskey, which are received within a specified statutory period. The amendment will meet the intentions of the noble and learned Lords but will circumvent the requirement for regulations.
I think the amendment will be valuable, particularly in enabling those bodies which already enjoy practising rights and which therefore perhaps know most about the issues involved, to contribute to the consideration and approval of an application. On that understanding, I hope that the noble and learned Lord will feel able to withdraw the amendment.
Lord Macaulay of Bragar: My Lords, I am grateful to the noble and learned Lord for that explanation and for the care and consideration he has given to what is an important aspect of the Bill. We shall await the terms put forward in another place, but in the meantime in the light of the undertaking given, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey moved Amendment No. 145:
Page 29, line 37, leave out ("subject to annulment in pursuance of a resolution of either House of Parliament") and insert ("No instrument shall be made under this section unless a draft of the instrument has been approved by both Houses of Parliament").
The noble and learned Lord said: My Lords, this amendment is a repeat of the same kind of provision contained in other parts of the Bill. I hope to hear the same positive response from the noble and learned Lord the Lord Advocate. In asking for that same response perhaps I may say that the proposals which are enshrined in Clause 22 are entirely novel. As I said earlier, the Court of Session has existed for 458 years without having lay pleaders conducting cases. Until this Bill was published no one would have dreamt of putting lay pleaders into the High Court of Justiciary. Therefore, the least we can expect is that this amendment is given proper consideration. I beg to move.
Lord Fraser of Carmyllie: My Lords, although at earlier points during Report stage I indicated a willingness to consider reversing matters to require affirmative resolution rather than negative resolution, in this area I do not experience the same concern As I remarked in answering earlier amendments, I do not envisage that regulations
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made under this subsection would be contentious. Indeed, I should expect them to cover additional areas of consumer protection or the prevention of a malpractice. In such circumstances it appears to me that they are not in the same category as those codes of conduct that we have previously considered. I have to indicate on this matter that I do not consider that an affirmative resolution would be an effective use of parliamentary time.
Lord McCluskey: My Lords, it is to be hoped that when the Bill finally receives Royal Assent, it will be coherent. I am sure that when the noble and learned Lord the Lord Advocate and the Secretary of State reflect on the matter they will see the wisdom of the proposal.
As I have said, it is an entirely novel matter. Parliament has a great interest in ensuring that the matter is properly regulated. Parliament should not approve such a course unless it is plainly seen to be in the interests of the better administration of justice.
I believe that, if the amendment or a proposal in its terms were accepted into the Bill, such a result would follow. I ask the Government to consider the matter again. I do not propose to pursue the matter further tonight. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey moved Amendment No. 146:
Page 29, line 41, leave out ("(a) and (b)").
The noble and learned Lord said: My Lords, Amendment No. 146 is a small but not unimportant amendment. The amendment states:
"Page 29, line 41, leave out ('(a) and (b)') ".
Subsection (6) provides that the Lord President has concern in relation to matters in subsection (2) (a) and (b), and the Secretary of State in relation to matters in subsection 2 (b) and (c). It is logical that the Lord President should have concern in all the matters. I believe that I am receiving positive and affirmative signals from the Government Front Bench. I shall not take up your Lordships' time by developing the argument. I beg to move.
Lord Fraser of Carmyllie: My Lords, the noble and learned Lord interpreted the signals correctly. I propose to accept his amendment. I do not even propose to take it away. It strikes me as eminently reasonable that the Lord President, who is responsible for considering the rules of the Law Society of Scotland in relation to the treatment of complaints and indemnity against client loss, should have a comparable role for these new providers of legal services. Moreover, it will give the Lord President an opportunity to consider the application in its entirety and to assess the implications of one aspect of a scheme for the application as a whole. I am grateful to the noble and learned Lord for bringing the amendment.
Lord McCluskey: My Lords, I am almost overcome by emotion. I can only sit down.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 147:
Page 29, line 44, at end insert:
("() In considering the code of practice included in the draft scheme by virtue of subsection (2) (b) (ii) above, the Lord President shall have regard to the desirability of there being common principles applying in relation to the exercising of rights to conduct litigation and rights of audience by all practitioners in relation to the court or, as the case may be, the courts, mentioned in the application.").
The noble and learned Lord said: My Lords, I have already spoken to the amendment in speaking to Amendment No. 141. I beg to move.
On Question, amendment agreed to.
[Amendment No. 148 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 149:
Page 30, line 3, at end insert:
("() In considering a draft scheme under subsection (6) or (7) above, the Lord President and the Secretary of State shall have regard to whether the provisions of the draft scheme are such as—

(a) to achieve; and

(b) to ensure the maintenance of,

appropriate standards of conduct and practice by persons who may acquire rights to conduct litigation or rights of audience in the event of the draft scheme being approved.").
The noble and learned Lord said: My Lords, the amendment is, I trust, the fruit of the consideration that I have been giving to what was said in Committee by the noble and learned Lord, Lord McCluskey, in moving his Amendment No. 239.
That amendment raised the question of what the Lord President and the Secretary of State should consider when required to decide whether or not to grant an application for rights of audience or rights to conduct litigation under this clause. Again, I am grateful to the noble and learned Lord for raising this important matter. I bring the amendment before the House in an attempt to meet the concern that he expressed.
The amendment focuses on the maintenance of standards of conduct and practice before the courts and in the conduct of litigations. The amendment does not confine the consideration of the Lord President and the Secretary of State to those matters alone, but it does provide some guidance for them in doing so. It is clearly of primary importance that any scheme under which non-lawyers are to be accorded rights to conduct litigation and rights of audience makes proper provision to secure and maintain the standards of conduct and practice which the court rightly demands. As I mentioned in Committee, I have no doubt that the Lord President will also have regard to the furtherance of the administration of justice when considering a draft scheme which is put to him under this clause, but the purpose of the amendment is to provide a focus for his consideration; namely, on the necessary standards of conduct and practice. I beg to move.
Lord McCluskey: My Lords, I am grateful to the noble and learned Lord for what he has said. There is nothing I can add to assist the House. I am happy to support the amendment.
On Question, amendment agreed to.
10 p.m.
Lord McCluskey Lord McCluskey moved Amendment No. 150:
Page 30, line 18, leave out ("giving written reasons for the refusal").
The noble and learned Lord said: My Lords, this amendment is linked with Amendment No. 151. In my mind anyway, the two are linked. The matter with which I am concerned here is judicial review.
Amendment No. 150 deletes the words,
"giving written reasons for the refusal".
Amendment No. 151 inserts the specific provision that the decision is to be beyond review in any court of law or otherwise, a provision which is to be found when one seeks to exclude judicial review, although it is not necessarily always successful. I should like to hear from the Lord Advocate whether or not the Government intend that there should be judicial review, and, if they intend that there should be judicial review by the current wording, whether or not they think that their intention has been realised.
There is another smaller point which is not unimportant for the Lord President in the exercise of his duties. Noble Lords will see from the construction of subsection (9) that, if both officers of state are satisfied, the Lord President shall grant the application. But under paragraph (b), if they are not satisfied, the Lord President shall refuse it. It seems that, if either of them is not satisfied, the Lord President shall refuse the application. If therefore the Lord President is satisfied with the scheme but the Secretary of State is not, it is the duty of the Lord President, who disagrees with the Secretary of State, to give the Secretary of State reasons in writing for the refusal. If I am right, that seems a slightly odd position.
My main reason for putting down the amendments is to seek clarification in relation to the general matter of judicial review. In the hope that I get it tonight, I beg to move.
Lord Macaulay of Bragar: My Lords, I have some reservations about the amendments. Taking this step takes away a right that is given to people under the clause. To remove that right in the way that is being done might smack of elitism and some kind of secret court procedure. I am not happy with the amendment as it stands. I agree that the interpretation of Clause 22 (9)(b) leads to a rather absurd situation. But that is a matter for the Government to take into account when considering the amendment.
Lord Fraser of Carmyllie: My Lords, I do not think that the anxiety expressed is correct, but I shall check that. Turning to Amendments Nos. 150 and 151, I do not see what can be gained if they were to be accepted. It is only fair and reasonable that where a body has an application for rights of audience, or rights 10 conduct litigation, refused, the Lord President should give his reasons for so refusing. It is in the best interests of openness and accountability, and most particularly to allow the applicant body to reconsider its position in the light
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of the Lord President's reasoned refusal of an application, that he should disclose his reasons to the body in question for so refusing.
Turning to Amendment No. 151, if written grounds of refusal were there, I suppose it makes it easier for the Lord President to be subject to judicial review. But I should emphasise that the purpose of this part of the clause is not to get the Lord President of the Court of Session in the sights of his colleagues in the court and subject him to that judicial scrutiny. It is the rather more obvious point that I have already made. If we have an applicant body, and if it knows—and has those reasons set out in writing—where it has fallen short of securing the Lord President's approval, it will at least know how it might contemplate amending its draft scheme, improving its education arrangements, and improving the code of practice that it has sought to put forward. I would far rather look at this in that rather more constructive atmosphere than suggest that what we are after here is in some way to embarrass or cause difficulties for the Lord President.
Lord McCluskey: My Lords, it is rather strange that the Bill should deliberately contain a provision the purpose of which includes that the decision of the Lord President on a matter of this kind, or at least the decision of the Secretary of State on a matter of this kind, should be subject to judicial review. If the decision is that of the Lord President, then it means that someone can raise proceedings for judicial review and the matter will be redetermined by a Lord Ordinary and ultimately by a division of the Inner House. That is unprecedented so far as I am aware.
In England one had the same kind of thing in relation to decisions by the Lord Chancellor; but then the Lord Chancellor was deciding in his capacity as a Minister and not in his capacity as a judge when his decision was brought under review in the High Court. However, I do not want to take the matter any further, and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 151 not moved.]
Lord McCluskey Lord McCluskey moved Amendment No. 152:
Page 30, line 19, at end insert:
(". In determining whether or not he is satisfied with any such scheme the paramount consideration to which the Lord President shall have regard is whether or not the acquisition and exercise by such persons of such rights under the scheme would, in his opinion, be likely to further the administration of justice").
The noble and learned Lord said: My Lords, Amendment No. 152 is again a repeat of something moved at Committee, but I am astonished that the Lord Advocate has not adopted the words contained in this amendment. Your Lordships will recall that on 2nd April, at cols. 1104 to 1107 of Hansard, and especially near the top of col. 1106, there was considerable support for the notion that the Lord President should have regard most particularly to

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the question as to whether or not the acquisition, and exercise, by persons of enfranchisement under Clause 22 would be likely to further the administration of justice.
Once again it echoes the point that the responsibility of this Parliament is to ensure that it does not enact a provision of this kind unless it leads to the better administration of justice. That had powerful support from the noble and learned Lord, Lord Simon of Glaisdale, and others, and I am surprised that the Government have not simply adopted it for themselves. In the hope that they will now do so and support the amendment, I beg to move.
Lord Fraser of Carmyllie: My Lords, perhaps I may deal with the matter briefly, because while it is not precisely the same point, the amendment essentially traverses ground that I thought we had covered when I moved Amendment No. 149 which ensures that standards of conduct and practice among non-lawyer practitioners are maintained. As I said then, the Lord President will undoubtedly pay due regard to the interests of justice.
It is not because I disagree with the noble and learned Lord that I invite him to withdraw the amendment, but because it seems to me that the matter is fully covered. I want to avoid elevating the convenience and efficiency of the courts to the status of the supreme goal—the client's right to choose any competent representative who observes the appropriate duties to the court and conforms to appropriate rules of conduct which are also of fundamental importance. It is necessary to achieve a balance. I take the view that given the amendment that I moved, that balance has now been struck.
Lord McCluskey: My Lords, I am not content that the balance has been properly struck, but I recognise and acknowledge that the noble and learned Lord the Lord Advocate has moved some way in the direction of what is proposed. At this time of night, I merely content myself by asking leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey moved Amendment No. 153:
Page 30, leave out lines 23 to 25.
The noble and learned Lord said: My Lords, this is a short amendment which raises a point with which I have dealt a number of times, and which is a most important point: that the clause as presently drafted envisages that the Lord Justice General will make acts of adjournal regulating the conduct in the High Court of Justiciary of persons who are what I have been calling barefoot pleaders engaged in criminal proceedings.
Your Lordships will be aware that in the High Court we deal with cases of murder, rape, arson, culpable homicide, fraud, uttering, counterfeiting, the misuse of drugs and other similar matters. Nothing that the noble and learned Lord the Lord Advocate has said in the course of these protracted
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proceedings has indicated that there is any support anywhere in the country—there is none in the House—for allowing laymen to appear in criminal proceedings. I urge the Government to follow the logic of that and say to themselves, "We now realise that we cannot seek sensibly to persuade Parliament that it will be for the better administration of criminal justice that laymen should be accorded this right", accept the amendment and remove criminal proceedings from the Bill.
I am aware that technically the amendment is not correct and that other amendments will be required; but the amendment is sufficient to raise sharply that one point. I ask the Government to acknowledge that fact, accept the thinking behind the amendment and in due course introduce amendments which will put the proposal into the Bill. I beg to move.
Lord Carmichael of Keivingrove: My Lords, perhaps I may intervene in this high level discussion. Will the noble and learned Lord the Lord Advocate say whether there is equivalent legislation in England to allow Scottish barristers to practise here? Is the measure reciprocal?
Lord Fraser of Carmyllie: My Lords, on the matter of reciprocity of rights as between Scottish advocates and English barristers, we shall deal with that point more precisely under Clause 23. Provisions comparable to Clause 22 are in the process of being introduced for England and Wales.
We are dealing in the High Court of Justiciary in Scotland, as the noble and learned Lord said, with the most serious crimes in our calendar. I have no doubt that before anyone is afforded rights of audience in that court, there would be required to be not just a scheme but training and a code of practice, and it will be difficult to achieve success without a deep knowledge of the law.
It is not the barefoot pleader who will acquire these rights, as might be envisaged, but someone who, if the noble and learned Lord likes, will look to all intents and purposes like a lawyer but may not formally be so. I appreciate the anxieties of the noble and learned Lord. However, I still have difficulty in understanding this when I consider the way in which the scheme is set up, the role of the Secretary of State for Scotland and the involvement of the senior judge for Scotland in all this. I have none of the qualms or anxieties that the noble and learned Lord has that these people might be permitted to appear in our most important criminal courts, nor that they might not have the qualifications, the integrity or the expertise to discharge the duties, which are undoubtedly difficult to discharge.
10.15 p.m.
Lord McCluskey: My Lords, once again I have failed to persuade the noble and learned Lord. I shall simply leave the matter in the hope that on further reflection between now and the passage of the Bill through another place and its return here, possibly in the autumn, the noble and learned Lord the Lord Advocate and his colleague the Secretary of State will think again. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 154:
Page 30, line 30, after ("above") insert (", and who appears to the body to be a fit and proper person,").
The noble and learned Lord said: My Lords, in moving Amendment No. 141 I also spoke to this amendment. I beg to move Amendment No. 154.
On Question, amendment agreed to.
Lord McCluskey Lord McCluskey moved Amendment No. 155:
Page 30, line 32, at end insert:
("(11A) Any right conferred by subsection (11) above has effect subject to any condition attached to its exercise in pursuance of the scheme in question and shall cease to have effect if the Secretary of State brings the scheme to an end in pursuance of subsection (11B) below.
(11B) In any case where the Secretary of State is satisfied that a scheme which has been approved under this section ought no longer to have effect on the grounds that members of the body who have exercised rights of audience in any court in pursuance of the scheme have been the subject of complaints of such a nature that he considers that the scheme should be brought to an end, the Secretary of State shall by order made by statutory instrument provide for the termination of the scheme; and a statutory instrument under this subsection shall be subject to annulment in pursuance of a resolution of either House of Parliament.").
The noble and learned Lord said: My Lords, this was Amendment No. 244A at the Committee stage. The noble and learned Lord the Lord Advocate said on that occasion that he would reconsider the point. He also said in reply to matters that I raised that he would consider whether the Lord President or the Lord Justice General should have a role in relation to this provision.
The amendment proposes a means for terminating the scheme if it has proved unsuccessful. The Bill permits that, if persons who have been brought in to plead in terms of a scheme should prove to be unsuitable in some way, they can be removed or have their rights of audience taken from them. However, it must be possible also to terminate the whole scheme if it has proved unsuccessful. That power ought to be put into the legislation. Despite what the noble and learned Lord the Lord Advocate said at the Committee stage, I do not believe that he has brought in any provision at all that reflects the fruits of his consideration. I therefore wish to hear from the Government why their consideration did not lead them to propose such a change in the provision. I beg to move.
Lord Fraser of Carmyllie: My Lords, as I indicated during the Committee's discussion of an identical amendment tabled in the names of the noble Lords, Lord Macaulay and Lord Carmichael, I am sympathetic to the idea of a review power for rules which have received the approval of the Secretary of State. I accept that I undertook to consider the matter further. I regret that it has taken me longer to do so than I had envisaged since I now wish to intertwine the aim of this amendment with a more general provision to enable the Secretary of State for Scotland and the Lord President to instigate a review of certain rules where they consider that to be appropriate.
The noble and learned Lord, Lord McCluskey, will note that this amendment makes no reference
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to the Lord President. As he pointed out during our discussion in Committee, there is undoubtedly a role here for the Lord President and the amendment to be brought forward in another place will establish a locus for the Lord President both in instigating a review of a particular rule and in judging the outcome of that review. Both the Lord President and the Secretary of State will be able to initiate a review though a rule will be changed only where both agree with the change proposed. Neither will therefore be able to change a rule without the agreement of the other.
I believe this is an important counterbalance which will ensure that the interests of justice and the interests of promoting and maintaining client choice are fully taken into account. However, where both the Lord President and the Secretary of State agree that a rule needs to be changed there has to be some means of enforcing such a change. The Secretary of State therefore proposes to include in that amendment a power for the Secretary of State, with the agreement of the Lord President, to revoke a body's practising rights broadly along the lines proposed in this amendment.
However, I could not accept this amendment in isolation as I believe other matters need to be dealt with at the same time. It is unfortunate that I have not been able to do so, as we could possibly have avoided this brief debate. However, on the understanding that the purpose of this amendment will be met by a Government amendment in another place I hope that the noble and learned Lord will be prepared to withdraw his amendment.
Lord McCluskey: My Lords, again I am happy to accept what the noble and learned Lord the Lord Advocate has said. In the light of what he has said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey moved Amendment No. 156:
Page 30, line 33, leave out subsection (12).
The noble and learned Lord said: My Lords, I spoke to this same point in relation to a different clause. Once again we have a subsection which imposes upon the Lord Advocate and the Secretary of State a duty to exercise their respective functions,
"as soon as is reasonably practicable".
The subsection imposes that duty upon no other person that I can discover in this clause. I am not sure whether that was the Government's intention or whether they planned that the provision should bite not only upon the two officers of state but also upon the various bodies which are mentioned. In my view that is not the case. I beg to move.
Lord Fraser of Carmyllie: My Lords, when I spoke to Amendment No. 132 before dinner I indicated that I thought Amendment No. 156 would be coupled with it. However, I appreciate that it is not. I have already had my tail twisted about this provision, not once, twice or three times, but now for the fourth time. I doubt whether there is any way that I can elaborate on the provision that will satisfy the noble and learned Lord. I shall have to leave my arguments where they rest.
Lord McCluskey: My Lords, if the noble and learned Lord the Lord Advocate will tell me how many times I have to twist his tail before it comes off I should be grateful. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 157:
Page 30, line 43, at end insert:

("(13A) Where a complaint has been made that a person has been guilty of professional misconduct in the exercise of any right to conduct litigation or right of audience held by him by virtue of this section, the body of which he is a member may, or if so requested by the Lord President shall, suspend that person from exercising that right pending determination of that complaint by the body.

(13B) Where a person holding a right of audience in any court by virtue of this section is instructed to appear in that court, those instructions shall take precedence before any of his other professional or business obligations, and the code of practice mentioned in subsection (2) (b) (ii) above shall include rules —

(a) establishing the order of precedence of courts for the purposes of this subsection;

(b) stating general criteria to which members of the body should have regard in determining whether to accept instructions in particular circumstances; and

(c) securing, through such of their officers as they think appropriate, that, where possible, any person wishing to be represented before any court by one of their members holding an appropriate right of audience is so represented, and, for the purposes of such rules, the Inner and Outer Houses of the Court of Session, and the High Court of Justiciary exercising its appellate jurisdiction, may be treated as separate courts.").

The noble and learned Lord said: My Lords, in moving Amendment No. 141 I spoke to Amendment No. 157. I beg to move.
On Question, amendment agreed to.
Lord Macaulay of Bragar Lord Macaulay of Bragar moved Amendment No. 158:
Page 31, line 17, at end insert:
("() The provisions of this section and section 21 of this Act shall not affect the right of a person receiving legal aid in the High Court under Part IV of the Legal Aid (Scotland) Act 1986 to select his solicitor (or other authorised litigator) and counsel (or other authorised advocate) to act for him, and regulations made under that Act shall not provide that representation in the High Court shall be by solicitor only").
The noble Lord said: My Lords, I can fairly say that this is one of the most important amendments we shall consider today. It goes to the very heart of representation under the new scheme. There was an equivalent provision in the Courts and Legal Services Bill which was approved by your Lordships' House. As I understand it, the provision was taken out of the Bill in another place.
The reasoning for the amendment in its present form is that with the new form of solicitor-advocate pleader getting rights of audience in the higher court, and in particular the High Court, where different cases require different degrees of expertise and experience, it would be regrettable to say the least if the Legal Aid Board in approving or disapproving an application for legal aid in a serious case were to make it compulsory, so to speak, that because the advocate-solicitor had gained the right of representation he could not instruct a senior counsel in the appropriate case.
We do not know how the scheme will work. However, it is certain that anyone appearing in superior courts in Scotland, whether he is fee paying or under the legal aid scheme, is entitled to the best representation available. The implementtion of the Bill and the granting of these rights of audience must not be allowed to turn representation in serious criminal cases, and particularly those on legal aid, into a second-rate representation scheme in which the people who should handle a particular case are turned down.
We do not know what motivates the Legal Aid Board. We sometimes wonder. Perhaps I may refer to a recent case, but since it is continuing I shall not mention it by name. The noble and learned Lord the Lord Advocate will be familiar with it. It is a case of the rape of a four year-old child. An application was made for legal aid for representation, and the man concerned ended up with a very junior counsel who, although he did not say that he could not do the job, instantly recognised that to cross-examine a child of that age required far more expertise than he possessed. We hope that appropriate representation has now been gained for that individual.
The amendment is intended to achieve a fair system of representation and avoid a restrictive one resulting from the existence of the new pleaders. I beg to move.
Lord Fraser of Carmyllie: My Lords, this is an important opportunity to explain an important matter. I appreciate that the noble Lord wishes to ensure that the right of a person to receive legal aid in respect of proceedings in the High Court should be protected. I can assure noble Lords that there is no intention that the provisions of Clauses 21 and 22 should act in a restrictive way. Indeed, the purpose of the provisions is to extend choice. I can see, however, that there is a case for considering statutory provision to ensure that legally-aided persons will not be confined to using representatives from one professional group rather than another for what might be seen as improper reasons. We shall of course need to retain control in the area of legal aid over the sanctioning of counsel in the lower courts which has existed for a very long time or the use of silks (whether advocates or in future solicitors). By contrast, however, I do not see that the issue is confined to criminal matters. I shall take this away to reflect on what might best be done, and I hope that the noble Lord will withdraw the amendment in the light of that assurance.
Lord Macaulay of Bragar: My Lords, I am very grateful to the noble and learned Lord the Lord Advocate for his consideration of the amendment. I appreciate that it was tabled at a very late stage and understand that time will be required to consider the implications. In the meantime no doubt his words will be noted in another quarter dealing with legal aid. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Speaker: My Lords, in calling Amendment No. 159 I have to say that, were it agreed to, I could not call the next amendment.
Lord Morton of Shuna Lord Morton of Shuna: moved Amendment No. 159:
Page 31, line 18, leave out subsection (1).
The noble and learned Lord said: My Lords, in moving the amendment I realise that I shall be repeating very much what I said in Committee. Subsection (2) of this clause provides for English, Welsh and Northern Irish practitioners to qualify to practise in Scotland on terms similar to those on which practitioners from other member states may qualify to practise in Scotland. That being so, and there being no possible objection to it, subsection
(1) appears totally unnecessary. That subsection allows an apparently different approach and allows different people to practise. In subsection (1) the English, Welsh and Northern Irish are given rights which will not be given to the French, Germans, Belgians and the others. There seems no possible reason for that.
There is also a danger because the English provision which is going through Parliament contains the equivalent of Clause 22. Therefore, people having special rights in English, Northern Irish or Welsh courts may now be allowed by the Secretary of State, after consultation with the Lord President—even if the Lord President disagrees—to practise in a totally different legal system. Subsection (2) covers everything that is necessary and proper. There is no reason for subsection (1). I beg to move.
10.30 p.m.
Lord McCluskey: My Lords, I put my name to the amendment because, despite my best endeavours and having read what the Lord Advocate said at cols. 1149 to 1151 of Hansard of 2nd April, I am at a loss to understand why subsection (1) is included. I do not want to repeat what my noble and learned friend Lord Morton of Shuna said, but I ask the Lord Advocate to explain as succinctly and clearly as he can what subsection (1) seeks to give that is not given in subsection (2). We understand that subsection (2) is necessary for purposes connected with the European Community.
In my mind, Amendment No. 159 is linked with Amendment No. 161, which seeks to remove lines 10 and 11 on the next page; in other words, to remove: from the definition of "practitioner" the words,
"any person falling within such category as may be prescribed in regulations made by the Secretary of State".
Under Clause 23 (1) given the terms of that definition, it appears that the Secretary of State, after merely consulting the Lord President, can take a step by regulation which enables him to bypass Clause 22. Under Clause 22, patent agents or the like can apply and, if a scheme is approved by the Lord President and the Secretary of State, they can gain certain rights in Scotland. However, under Clause 23, if they choose not to bother with Clause 22 procedures, they can get in by the back door if the Secretary of State prescribes circumstances such as the subsection allows.
That proposal is entirely obnoxious. The Secretary of Stats has a duty to consult the Lord President, but then goes on to make the regulations himself.
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He can designate anyone to be a practitioner. The noble and learned Lord the Lord Advocate tried to assure me that the reason for doing that was that the Courts and Legal Services Bill contains a provision which allows Scots to plead in England. I do not know of any Scot who asked for that provision. No one asked me whether I was in favour of it. It did not appear in the Green Paper or in the White Paper for Scotland. The mere fact that this House has apparently accepted that proposal for England does not appear to me to take one step towards proving that it is right for Scotland.
The most obnoxious and intolerable thing is that under the clause the Secretary of State can enable practitioners as defined—that includes barefoot pleaders from England—to practise in Scotland without having to pass the tests that we have so carefully formulated in Clause 22. I should like to hear the Government's answer to that point, which I have made before.
Lord Fraser of Carmyllie: My Lords, the noble and learned Lord has made that point before.
The first point that I wish to make about the amendment is that it is incomplete as it does not make consequential provisions to subsection (3) of Clause 23, which refers to regulations made under subsection (1). In any case, it is not possible for me to accept the amendment, which would have the effect of perpetuating the illogical situation whereby lawyers from other member states in the European Community can provide certain services in Scotland which may not be so provided by lawyers from other jurisdictions in the United Kingdom.
When we dealt with the clause in Committee there was some misunderstanding about the respective purposes of subsections (1) and (2). I hope that at the second time of trying I can clarify the situation. Put simply, subsection (1) corresponds to the 1977 EC services directive and concerns the provision of services by lawyers from other UK jurisdictions. By contrast subsection (2) mirrors the provisions of the 1988 diplomas directive which is due to come into effect in 1990 or 1991. That measure will provide for lawyers from other jurisdictions to be recognised as such in the United Kingdom and will provide all the services, given that they conform with regulations shortly to be made to implement the directive, that the host state equivalent may provide.
Therefore, in this clause we are dealing with two quite different situations. It is for that reason that separate provision is necessary in discharge of the obligations that we have taken on within the European Community.
Lord McCluskey: My Lords, before the noble and learned resumes his seat I ask him to address himself to the point that I have asked. It is not fair to the House that he should not answer the point that has been put. He talked about the EC directive in relation to lawyers. I am concerned about the definition of "practitioner" including any person falling within such category as may be prescribed which means non-lawyers. Does the EC directive cover that person? That is the question I asked, and I repeat it.
Lord Fraser of Carmyllie: My Lords, I had already sat down. I really cannot go over the matter again. As I have indicated, we are acting in discharge of directive matters. I hope that the noble and learned Lord will appreciate what obligations are incumbent on us and will consider these matters.
Lord Morton of Shuna: My Lords, when one looks at Clause 23 (2) one sees no reference to any directive. The clause gives a power to the Secretary of State, after consulting the Lord President, to make provision for enabling practitioners from parts of the United Kingdom other than Scotland to practise in Scotland on terms similar to those given to other member states. It does not matter whether there is a 1990 directive, a 1970 directive or any other directive. That is what the clause enables the Secretary of State to do.
From everything that the noble and learned Lord has said it is unclear to me—no doubt it is my fault —why it is necessary to say the same thing twice and why, in subsection (1), it is necessary to bring in the non-lawyer practitioner. Nothing that the noble and learned Lord said has made matters clear. I regret the position. There is nothing I can do beyond asking the leave of the House to withdraw the amendment. I do so with regret because the noble and learned Lord has not made the matter in any sense clear. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 160:
Page 31, line 20, leave out ("a practitioner who is") and insert ("practitioners who are").
The noble and learned Lord said: My Lords, this is a drafting amendment, the need for which was noticed in Committee by the noble Lord, Lord Grimond, to whom I am grateful. I beg to move.
On Question, amendment agreed to.
Lord McCluskey Lord McCluskey moved Amendment No. 161:
Page 32, leave out lines 10 and 11.
The noble and learned Lord said: My Lords, the amendment seeks to take out that part of the definition of "practitioner" that refers to persons who are not lawyers. The purpose of having proceedings of this character in this House is to enable the Government to explain their position to Members of your Lordships' House. The purpose of our being here at this late hour of the night is to enable us to ask such questions as we think should be answered.
I ask the noble and learned Lord the Lord Advocate this question: are the Government saying that the EC directive—and, if so, which one—requires the Government to include in a Bill such as this a provision conferring on persons who are not lawyers a right of audience in our courts? I beg to move.
Lord Cameron of Lochbroom: My Lords, I wish to add to what my noble and learned friend has said. Is it necessary to define "practitioner" in subsection (6) having regard to the definition which appears in
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each of subsections (1) and (2); namely, practitioners who are qualified to practise in England and Wales or Northern Ireland? The definition is the same in each subsection.
It appears to be otiose to further define, but perhaps I have missed a point. There appears to be a clear definition of a practitioner in the qualifying clause in subsections (1) and (2).
Lord Fraser of Carmyllie: My Lords, the first of these amendments seeks to delete from the Bill a provision for which there is an equivalent in the Courts and Legal Services Bill to permit those who have been accorded rights of audience in England and Wales and Northern Ireland, but who are not barristers or solicitors, to acquire rights to practise in Scotland. Although I have already indicated that these provisions are intended essentially to cover what are covered in two separate EC directives, the provision about defining a practitioner goes beyond what is required under those directives. The purpose is to acknowledge that rights gained in other jurisdictions within the United Kingdom by non-lawyers might be extended in such a way as to allow them to appear in Scotland. I should be most reluctant to delete the Scottish part of what is, in effect, a reciprocal provision.
It is not necessary for us again to traverse the ground of the likelihood of there being any extended group which might, under the equivalent of Clause 22, acquire such rights of audience. If there is to be such a provision in England, Wales and Scotland it would seem only right that there should be at least the opportunity or possibility of reciprocity.
I believe however that the amendment standing in my name, which provides a role for the Secretary of State in the making of any regulations to define a practitioner for purposes of this clause, should be sufficient to satisfy the concerns which were expressed about the provision at Committee stage. I fully appreciate that it would not be appropriate for there to be a route by which non-lawyers could acquire rights of audience in Scotland which did not involve the Lord President. That is not what the clause now provides for of course with the reference in subsections (1) and (2) to the Secretary of State consulting the Lord President about regulations relating to conditions for practising.
A further safeguard is provided for by my Amendment No. 162 which will ensure that the Lord President is consulted before the Secretary of State makes regulations prescribing what "practitioner" means; namely, who in addition to lawyers could be covered. In answer to the noble and learned Lord, Lord Cameron, that is the reason why there appears to be a duplication of the definition. It is to allow the Secretary of State the opportunity to make the regulation covering that.
There are professions whose law and practice is essentially the same throughout the UK. For such professions the provision could be potentially valuable. Scottish clients should be able to choose to avail themselves of the services of such practitioners without unnecessary difficulty. The role of the Secretary of State and the Lord President will ensure

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that that facility is not extended in such a way as to prejudice necessary safeguards for clients. With that fuller explanation, I hope that the amendment will be withdrawn.
Lord McCluskey: My Lords, with the leave of the House, the amendment will certainly be withdrawn. However, I am happy that at last the noble and learned Lord has acknowledged in plain terms that the provisions of the clause go beyond the requirements of the EC directives. The only justification for the provision—and it is shabby and unworthy—is that there should be reciprocity. Reciprocity with what? It is with provisions contained in the Courts and Legal Services Bill which nobody on either side of the Border wanted and about which so far as I can tell nobody was asked. I know of no one who supported it, and the Government have failed to tell us of anyone who did so.
Lastly, although the clause will be better if the Lord President has to be consulted, consultation is not enough. It is all very well for the noble and learned Lord the Lord Advocate to assure us that the Secretary of State will do this or will not do that. Once the Bill has been passed and the Secretary of State is given power, it is not within the power of this Lord Advocate or the present Secretary of State to control those who exercise the powers in the future. The noble and learned Lord's guarantees are not worth very much. Disappointed though I am, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
10.45 p.m.
Lord Eraser of Carmyllie Lord Eraser of Carmyllie moved Amendment No. 162:
Page 32, line 11, at end insert ("after consultation with the Lord President.").
The noble and learned Lord said: My Lords, this amendment is intended to meet the anxieties expressed during the Committee's consideration of Amendment No. 255ZA tabled by the noble and learned Lord, Lord McCluskey. In particular, it reflects a suggestion made by the noble Lord, Lord Mackie, whose patience seems to have worn out, who suggested that the Lord President should be consulted by the Secretary of State in making regulations under Clause 23 (6) (b). As I indicated at the time that suggestion struck me as reasonable and I therefore bring this amendment before the House to implement it. I am indeed grateful to the noble Lord for making the original suggestion and I acknowledge the Government's indebtedness to him for doing so. I beg to move.
On Question, amendment agreed to.
Lord McCluskey Lord McCluskey had given notice of his intention to move Amendment No. 163:
Page 32, line 11, at end insert ("and such regulations shall include a requirement that such person shall satisfy the Lord President that he is a fit and proper person to have such a right of audience.").
The noble and learned Lord said: My Lords, in view of the previous observations by the noble and learned Lord the Lord Advocate, I have no
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confidence that he will accept this amendment. At this hour I do not propose to repeat the argument. Accordingly I do not move it.
[Amendment No. 163 not moved.]
Clause 24 [Rules of Conduct etc.]:
[Amendments Nos. 164 and 165 not moved.]
Lord McCluskey Lord McCluskey moved Amendment No. 166:
After Clause 24, insert the following new clause:
("Duty to act for any client

—(1) Except in circumstances in which it would be unreasonable to require him to do so any advocate and any solicitor or other person who has a right of audience in any Court whatsoever shall be under a duty to act for any client or person who wishes to be his client (whether legally aided or not) in any Court in relation to which he exercises a right of audience provided only that such a client offers to pay him such fee as is reasonable or, if he is legally aided, such fee as is allowed by the Scottish Legal Aid Board.

(2) In the event of any disagreement as to whether or not any non legal aid fee tendered is reasonable, the Auditor of the Court of Session shall determine whether or not any fee offered is reasonable in all the circumstances.").

The noble and learned Lord said: My Lords, your Lordships will recognise that this is a reformulation with additions of a matter which was discussed fully in Committee. If the Government are still opposed to this general proposal, I do not intend to divide the House. However, your Lordships will see that this amendment extends to any court whatever the rule which the original amendment sought to enshrine. It contains particular provisions as to how the reasonableness of the fee is to be assessed. Therefore it is a different amendment to that put forward on the previous occasion. The main purpose in my putting it forward with my noble and learned friend Lord Morton of Shuna is to enable the Government to tell us what their thinking is on this matter.
We hear that in another place in connection with the Courts and Legal Services Bill a version of the so-called cab rank rule is or may be acceptable to Her Majesty's Government. We also hear it said, although I do not know the truth of the matter, that in relation to the Scottish Bill the Government are thinking of advancing a suitable provision. Indeed, they may already have done so, but it has escaped my notice. In the hope that the noble and learned Lord will answer my points, I beg to move.
Lord Macaulay of Bragar: My Lords, the amendment states:
"such fee as is allowed by the Scottish Legal Aid Board".
The problem is that when legal aid is granted, the nature of the fee is not known for a considerable time except perhaps in a very complicated fraud case where a fee may be agreed in advance for preparatory work. However, under the present scheme it is impossible to say whether the fee is reasonable because that will not be known until the case has finished. I see that as a difficulty in the implementation of the clause were it to be accepted by the Government.
The second matter is that I should put on record—not advancing it on my own behalf—that I have been asked by the Law Society of Scotland to indicate that they are satisfied with the provisions

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of the new Section 25A of the Solicitors (Scotland) Act 1980 contained in Clause 21 of this Bill, and they are therefore not in favour of this amendment. I merely put that on record.
Lord Coleraine: My Lords, I am sorry that the noble and learned Lord should once again move this tired old cab rank—or cab horse—rule in a more grievous form than it was moved in Committee, on which occasion the Committee rejected it resoundingly. On that occasion, as your Lordships will recall, I did speculate as to what were the views of the Law Society of Scotland on the amendment then moved.
The noble Lord, Lord Macaulay of Bragar, indicated that his information was that the Law Society approved the amendment in the form then before the Committee. However, I think possibly the noble Lord was confusing the brief he may have had from the Labour Party with the advice he received from the Law Society, because so far as I am aware the Law Society of Scotland did not approve the amendment which was debated and voted on a few weeks ago and does not support this amendment.
I should refer to the position in the English courts Bill as I understand it. An amendment is to be moved in another place to preserve some of the effects of the cab rank rule, but in a form which is likely to be acceptable to the Law Society of England. The general effect will be that it will move away from any duty to represent all and sundry towards a prohibition against not acting in two specific circumstances. One of those is where the client or the case is objectionable to the solicitors or the public; the other is where there might be objection on the grounds of the manner of funding of the advocacy.
We therefore have a situation where in England we are moving away from the rigours of the cab rank rule towards something which will be acceptable. Certainly at no time when the Courts and Legal Services Bill has been before the House or the Committee has there been any suggestion that the cab rank rule should apply to all the courts and not just to courts where extended rights of audience are given.
In those circumstances I hope the noble and learned Lord will not press the amendment.
Lord Fraser of Carmyllie: My Lords, we have yet another version of the cab rank rule and it looks very different to the one that I understand is proposed for the Courts and Legal Services Bill. From the brief interventions there were from members of the legal profession on this side of the Border when we considered this matter at Committee stage, one point came through very clearly. Although it is sometimes described as a single rule of the cab rank, we are often speaking of very different matters, certainly from the point the noble and learned, Lord, Lord McCluskey, made earlier that practitioners of the Scottish Bar are expected to be generalists. From what I understood of what was said on the English Bill, that provision is nothing like so extensive.
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The real point is the point raised by the noble Lord, Lord Macaulay. If we look to the provisions of Clause 21 or new Section 25A, we have been seeking to construct within that clause arrangements whereby the new breed of solicitor advocates will to all intents and purposes be bound by something that approximates very closely to the cab rank rule to which members of the faculty are subjected. What we have dealt with in terms of the order of precedence, the criteria and the requirements in Amendment No. 131—that the Lord President shall have regard to the desirability of there being common principles—seems to me to cover just the point at issue.
What I find difficult about this version of the rule is that on the one hand it seems to be remarkably onerous in its terms. It might, as I read it, impose on a solicitor who had never, from the time he qualified, stepped outwith his conveyancing chambers a requirement to appear in a district court in a distant and remote part of the country. It is in many respects, at first blush, an extremely wide requirement. On the other hand, it would appear that the let-out provision is very wide indeed and that all those anxieties might fall away.
From the way in which this part of the Bill has been approached there is no need or, indeed, desirability to try to set out the duty in these broad general terms. We know what is imposed on the Faculty of Advocates. There seems to be little dispute about that. I hope that with what we have in Clause 21, which introduces the new Clause 25A, solicitor advocates will be under no misapprehension about the duty imposed upon them.
Lord McCluskey: My Lord, I have no doubt that Members of another place will in due course consider what has been said by the Lord Advocate and the noble Lord, Lord Coleraine, tonight and compare that with what is said in relation to the so-called cab rank rule in the Courts and Legal Services Bill.
As I have already indicated, I do not propose to take the matter further and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 25 [Complaints in relation to legal services]:
[Amendment No. 167 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 168:
Page 33, line 33, leave out ("Confirmation Practitioners") and insert ("Executry Services").
The noble and learned Lord said: My Lords, in speaking to Amendment No. 54 I spoke also to this amendment. I beg to move.
On Question, amendment agreed to.
Lord McCluskey Lord McCluskey moved Amendment No. 169:
Page 33, line 39, leave out ("an") and insert ("a practising").
The noble and learned Lord said: My Lords, the House will recall that in connection with a different matter a distinction was drawn between an advocate and a practising advocate. It appeared logical to me to refer in this definition of a practitioner to a

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practising advocate rather than an advocate; the distinction being that any person who is a member of the Faculty of Advocates can, with the permission of the dean, cease to practise almost at once provided he has no outstanding obligation which the ethics of the profession will require him to complete. Accordingly, I beg to move this amendment in the hope that the Government will either accept it or provide a reasonable explanation as to why it is not acceptable.
Lord Fraser of Carmyllie: My Lords, in my view this amendment is unnecessary as there is a definition of an advocate to be found in Clause 35 which slates that an advocate is,
"a member of the Faculty of Advocates practicising as such".
The noble and learned Lord will appreciate that with that definition in the Bill his amendment is unnecessary.
Lord Macaulay of Bragar: My Lords —
Lord McCluskey: My Lords, I do not think that it is in the rules of the House for anyone other than the mover of the amendment to speak after the Minister has spoken.
In order to find out the answer to the question one must therefore study the definition in Clause 25 (5) and bear in mind the further definition in Clause 35. That seems to be an awfully convoluted way to do it. However, I accept that it works and accordingly I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 170 not moved.]
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 171:
Page 33, line 41, leave out ("Confirmation Practitioners") and insert ("Executry Services").
On Question, amendment agreed to.
11 p. m.
Clause 26 [Scottish legal services ombudsman]:
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 172:
Page 34, line 31, at end insert:
("(5A) The Secretary of State may by regulations extend the jurisdiction of the ombudsman by providing for this section to apply, with such modifications (if any) as he thinks fit, in relation to the investigation by the ombudsman of such categories of handling complaints as may be specified in the regulations with respect to the provision of executry services by persons other than executry practitioners within the meaning of section 20 of this Act.
(5B) Without prejudice to the generality of subsection (5A) above, regulations under that subsection may make provision for the investigation of handling complaints with respect to particular persons or categories of person.
(5C) Regulations under subsection (5A) above shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.").
The noble and learned Lord said: My Lords, I have spoken to this amendment in relation to Amendment No. 54. I beg to move.
On Question, amendment agreed to.
Lord McCluskey Lord McCluskey moved Amendment No. 173:
Page 34, line 37, leave out ("or").
The noble and learned Lord said: My Lords, noble Lords will see that under subsection (6) of Clause 26 certain persons are disqualified from being appointed as ombudsman. We have already dealt on a previous occasion with advocates, solicitors and qualified conveyancers. However, the last group are people mentioned under paragraph (d):
"any member or employee of a professional or other body any of whose members has acquired any right to conduct litigation or right of audience by virtue of section 22".
As I understand it, it means this. If a body—it might be a very substantial body—decides to apply for these rights, all its employees and other members, whether they want the rights or not, are to be disqualified.
I believe that the noble and learned Lord the Lord Advocate might be persuaded to accept my amendment. I do not propose therefore to labour the point. I beg to move.
Lord Fraser of Carmyllie: My Lords, I am not prepared to accept the amendment as it stands. I agree in principle with the noble and learned Lord in the greater part of the amendment except as it relates to employees of conveyancing and executry practitioners. I believe it is right that members and officers of the board together with principals, partners and directors or senior staff of conveyancing and executry practitioners should not be eligible for appointment as the Scottish Legal Services Ombudsman. However, I do not think it is necessary to extend the restriction to all employees of practitioners. This approach would be consistent with existing requirements with respect to the lay observer. Solicitors and advocates may not be appointed as lay observers, but the restriction does not extend to the employees of a solicitor, however unlikely it might be that such an employee might be appointed to that post.
With that undertaking, I hope that the noble and learned Lord will withdraw his amendment. There will be a government amendment.
Lord McCluskey: My Lords, I am certainly happy to hear what the noble and learned Lord the Lord Advocate said. Nonetheless, I did not quite understand it. My amendment relates to page 34, line 37. I leave out the word "or". As the noble and learned Lord the Lord Advocate has rightly divined, the amendment is not very good. However, I am happy to accept what he says. I have no doubt that the Government will consider it in the light of what is obviously common sense, as the noble and learned Lord the Lord Advocate accepts. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 174 not moved.]
Clause 27 [Judicial appointments]:
Lord McCluskey Lord McCluskey moved Amendment No. 175:
Page 34, line 45, after second ("sheriffs") insert (", advocates").
The noble and learned Lord said: My Lords, the amendment to Clause 27 relates to the period to be

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served by persons before they become eligible to be appointed as judges of the Court of Session and the High Court of Justiciary. It is a paving amendment. A later amendment provides that the period of qualification should be 15 years in the case of advocates and solicitors who are otherwise qualified to be appointed to the High Court. It is a paving amendment to allow that provision.
We are conscious that that involves a change from the provision of the Act of Union. However, everyone is agreed that one would not wish to appoint a person as a judge of the High Court or of the Court of Session, even from the ranks of the most distinguished advocates or solicitors, unless he had undertaken this period of service. It is our tradition that one undertakes a period of service as a practitioner. The measure enables one to become qualified to serve as a judge of the higher courts. It is in effect a paving amendment for what is to come later. I beg to move.
Lord Fraser of Carmyllie: My Lords, I have listened to the noble and learned Lord on this occasion as I listened to him when we dealt with precisely the same matter on an earlier occasion. I recognise that, at least in recent years, those advocates nominated for appointment as Court of Session judges have practised for 20 years or more at the Bar. In view of that, it might appear that the present statutory provision for a period of five years, is indeed unrealistically low. Given what I acknowledge is the practice, I can see the logic of the argument.
However, there are other considerations. It is the Government's policy that in respect of each judicial vacancy the best fitted candidate should be appointed. If, as has happened in the past, the only real candidates for appointment to the Court of Session Bench have been men—regrettably, not as yet men and women—who have spent their entire career at the Bar, then no harm would result if the minimum eligibility period was to be increased to 10, 15 or even 20 years. While no doubt that path to the Court of Session Bench will continue to be the main one for many years to come, I do not think it would be in any way correct to make provision such as it must in effect be the only one. To do so would be inconsistent with the policy that on each occasion the best fitted candidate should be appointed.
It is not difficult to construct an elaborate curriculum vitae of someone who might be appointed to the Court of Session Bench. It might be someone who has spent time in the academic world in Edinburgh and has also spent some time to develop his experience and abilities in a European context. I conclude that, as it has worked satisfactorily in the past, I do not see that there would be any point in altering it now.
Lord McCluskey: My Lords, we shall no doubt return to the matter if so advised when we come to deal with the schedule and the connected amendments. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey had given notice of his intention to move Amendment No. 176:
Page 35, line 1, leave out subsection (2).
The noble and learned Lord said: My Lords, this is an important amendment which has a constitutional dimension. It is almost 11.10 p.m. For important reasons I do not intend to develop my argument tonight. Fortunately, the argument and submission can also be raised in relation to Amendment No. 244. I propose not to develop the matter tonight for that reason. It is a matter of some importance and one on which I have consulted all the judges of the Outer House of the Court of Session. It is a matter with which I shall deal with some sadness when we come to Amendment No. 244. In the meantime, in the absence of my noble and learned friends Lord Morton of Shuna and Lord Cameron of Lochbroom, who have departed, I do not intend to raise the matter at this late hour. I shall raise it again when we reach Amendment No. 244.
[Amendment No. 176 not moved.]
Lord McCluskey Lord McCluskey moved Amendment No. 177:
Page 35, line 1, leave out ("the appointment of").
The noble and learned Lord said: My Lords, this is a highly technical amendment. Paragraph 4 of Schedule 3 relates among other things to the fact that the senior judge is no longer to preside as a matter of right. The person to preside in the Inner House or in an extra Division shall be the person who is directed by the Lord President to preside. From my reading of the statute that has nothing to do with the appointment of members of the Inner House or the appointment of a Lord Ordinary to be the Lord Ordinary in exchequer causes. Accordingly, it appears to me that the words "the appointment of" do not embrace that provision in the schedule. Therefore, for technical reasons they ought to be deleted from the statute. I beg to move.
Lord Fraser of Carmyllie: My Lords, we have had the opportunity in our debate to discuss an amendment to leave out subsection (2) of Clause 27 and to consider the appointment of Outer House judges to the Inner House. It may be of assistance for me to explain the reasoning with regard to Clause 27(2)(b), to which the present amendment would refer.
Section 3 of the 1988 Act provides that one of the judges of the court who usually sits as a Lord Ordinary shall be appointed by the court, by Act of Sederunt, to act as Lord Ordinary in exchequer causes. Appointment by the court by Act of Sederunt is a cumbersome way to make such an appointment. Paragraph 4 (3) of Schedule 3 therefore amends Section 3 of the 1988 Act to provide that instead of appointment being by way of the court by Act of Sederunt the appointment of the Lord Ordinary in exchequer causes will be made by the Lord President. As such, it is a minor but useful change to the existing procedures, and it is essentially procedural. With that slightly complicated explanation, I hope that the noble and learned Lord will be able to withdraw his amendment.
Lord McCluskey: My Lords, I think that the Lord Advocate perhaps had his mind and indeed his head elsewhere when I addressed myself to this amendment and missed the point I was making. However, I am sure that he will read it, and if it is technically sound he will consider introducing an appropriate amendment. I do not propose to repeat it because it is rather technical, and it has nothing to do with the exchequer causes at all. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCluskey Lord McCluskey had given notice of his intention to move Amendment No. 178:
Page 35, line 6, leave out subsection (3).
The noble and learned Lord said: My Lords, I put down this amendment because I needed to consult the noble and learned Lord, Lord Emslie, about it. Your Lordships may recall that at Committee stage it was argued that the appointment should be made by the Lord President, and the Lord Advocate said that there was a constitutional reason for the provision as it is. I do not propose to differ from the Lord Advocate on that, and accordingly I do not propose to move this amendment.
[Amendment No. 178 not moved.]
The Deputy Speaker (Lord Cocks of Hartcliffe): My Lords, before Clause 29, and not numbered on the Marshalled List, Amendment No. 178A.
Lord Macaulay of Bragar Lord Macaulay of Bragar moved Amendment No. 178A:
Before Clause 29, insert the following new clause:
("Review of legal services
The Secretary of State shall keep under review the extent, if any, to which needs for legal services are not being met and where any such deficiencies are found shall make appropriate provision.")
The noble Lord said: My Lords, this is a fairly short amendment but an important one. It reads:
The Secretary of State shall keep under review the extent, if any, to which needs for legal services are not being met and where any such deficiencies are found shall make appropriate provision. "
The purpose of the amendment is to place a duty on the Secretary of State to act where citizens have inadequate access to legal services. The citizen can only get access to the courts through representation and advice, and it is important that that should be kept under review.
There are important areas of legal advice and activities that are not covered by legal aid. Industrial tribunals are a classic example. Employees often go unrepresented while employers can engage expert solicitors. The provisions of Part V of the Legal Aid (Scotland) Act in relation to the power of the Scottish Legal Aid Board to employ solicitors to advise agencies in their work, and give other advice to clients of those agencies and promote contacts between advice agencies and local solicitors in private practice, and other provisions in that section, have not been implemented. It would be of great assistance to the voluntary organisations if such power could be brought into play.
The objective behind the amendment is to have a review, and a regular review, and not simply to sit back once the Bill becomes an Act and say, "Let us see how it works out in years to come. " This is really meant to imply a constant review to see that citizens get proper access to the courts through the present legislation. I beg to move.
Lord Fraser of Carmyllie: My Lords, I must ask the House to resist this amendment, which would put my right honourable friend the Secretary of State under a statutory duty which, on one interpretation, appears very onerous and yet on closer inspection might appear to be so general as to be meaningless. My right honourable friend is already very active in securing the broad availability of legal services in Scotland.
Legal aid annual expenditure in Scotland is over £60 million, which is 100 per cent. more than 10 years ago. Almost 300,000 accounts for legal aid and legal aid advice and assistance were paid in the last year. There is also in hand a review of eligibility for legal aid which will, it is hoped, lead to better targeting of the scheme on those who need help or advice when involved in legal proceedings. That comprehensive review of the way that legal services are provided which was conducted between 1987 and 1989 and of which this part of the Bill is the outcome is further demonstration of his responsibilities. I have already indicated to the House the steps that we propose to take to monitor the impact of the legislation on the availability and accessibility of legal services, especially in rural areas. Those are specific and practical steps which we have taken or will take. The amendment is, however, asking the impossible.
I do not know what is meant by "needs for legal services". I am sure that the noble Lord appreciates that it is an imprecise term which has a strong subjective slant. As there is no possibility of making a precise assessment of the need in that context, it would be inappropriate to put the Secretary of State under the type of statutory duty described in the amendment. There are many better ways of furthering the administration of justice. The Bill takes many positive steps in that direction.
Lord Macaulay of Bragar: My Lords, I am grateful to the Minister for that reasoned reply. I am pleased to hear—I am sure that it will be noted in the quarters affected by those activities—that the eligibility review will be of assistance. We look forward to hearing in due course the outcome of the inquiries. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 30 [Availability of legal aid in relation to services provided under this Act]:
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 179:
Page 37, line 9, leave out from ("of") to ("conveyancing") in line 10 and insert ("executry services by executry practitioners and recognised financial institutions and convevancing services by").
The noble and learned Lord said: My Lords, I spoke to this amendment when speaking to Amendment No. 54. I beg to move.
On Question, amendment agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 180:
Page 37, line 12, leave out ("18") and insert ("19").
The noble and learned Lord said: My Lords, I spoke to this amendment when speaking to Amendment No. 117. I beg to move.
On Question, amendment agreed to.
Clause 32 [Advisory and supervisory functions of the Director]:
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendments Nos. 181 and 182:
Page 37, line 38, after ("(11)") insert ("or 17 (10)")
Page 37, line 40, leave out ("or 17 (10)")
The noble and learned Lord said: My Lords, I spoke to Amendments Nos. 181 and 182 with Amendment No. 54. I beg to move.
On Question, amendments agreed to.
Lord Fraser of Carmyllie Lord Fraser of Carmyllie moved Amendment No. 183:
Page 37, line 41, leave out ("or (2)")
The noble and learned Lord said: My Lords, this is a minor consequential amendment. I beg to move.
On Question, amendment agreed to.
The Earl of Strathmore and Kinghorne: My Lords, I beg to move that further consideration on Report be now adjourned.
Moved accordingly, and, on Question, Motion agreed to.

Penzance South Pier Extension Bill
Brought from the Commons; read a first time, and referred to the Examiners.
House adjourned at nineteen minutes past eleven o'clock.