Lords Sitting of 28 November 1990

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Peterborough.

Race Relations Complaints: Army Procedure
Lord Harris of Greenwich Lord Harris of Greenwich asked Her Majesty's Government:
What procedural changes the army board proposes to make when considering complaints under the Race Relations Act 1976 following the judgment of the Divisional Court in the case of Regina v. Army Board of Defence Council, ex parte Anderson.
Lord Reay: My Lords, the Government are considering in detail what procedural changes are necessary in the light of the judgment.
Lord Harris of Greenwich: My Lords, I thank the noble Lord for that Answer. Does he agree that it is absolutely essential that the Ministry of Defence should do its best to ensure that young blacks serving in the army are treated with fairness? Is he aware that many of us are seriously concerned about the case?
I wish to ask two questions. First, did the Ministry of Defence army board receive legal advice before deciding how to handle the case? Secondly, is it not a matter of serious concern that Mr. Anderson and his representatives were not shown the information which was available to the army board? Is it not worrying that the army board decided, for reasons best known to itself, to adopt a policy of inflexibly refusing to accept oral hearings in such cases? Can the noble Lord assure us that the case will be dealt with expeditiously so that matters are put right?
Lord Reay: My Lords, I accept entirely the noble Lord's first remarks. It is essential that black soldiers should be treated fairly. In this case, the court found a number of faults in the procedures of the army board. In the reconsideration of the case, procedures will be applied which are consistent with the judgment given. Changes in procedure for any future cases are under consideration. I was asked a specific question concerning legal advice. Legal advice was provided as the case worked its way up the command chain.
Lord Williams of Elvel: My Lords, is it the case that, as Lord Justice Taylor reported, the army board not only refused to accept oral evidence, as the noble Lord, Lord Harris, said, but did not meet on this occasion? If so, are there not serious implications in the procedures of the army board which the Government need to address?
Lord Reay: My Lords, that is correct. It is one of the criticisms made of the procedure that the members of the army board did not meet. The intention now is to set up the board of inquiry as quickly as possible.
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It will conduct a very thorough investigation into all the facts and the different army board members will meet to reconsider the case.

Carbon Dioxide Emissions
2.40 p.m.
Lord Hatch of Lusby Lord Hatch of Lusby asked Her Majesty's Government:
Whether their pledge to stabilise carbon dioxide emissions is still conditional on the commitments of other nations.
The Parliamentary Under-Secretary of State, Department of the Environment (Baroness Blatch): My Lords, it was announced on 25th May that provided other countries took their full share, the Government were prepared to set the demanding target of returning our CO2 emissions to their present levels by the year 2005. This approach recognises that an effective response to climate change can only be achieved through concerted international action. Our target and approach have been recognised both in the agreement reached in the European Community on 29th October and in the Ministerial Declaration of the Second World Climate Conference on 8th November.
Lord Hatch of Lusby: My Lords, I was aware of that. Does the noble Baroness recall that on 12th November when she answered part of the debate on the gracious Speech, she said:
"This Government made a firm target and will deliver that target". [Official Report, 12/11/90; col. 183.]
Is that firm target dependent on what other countries do, or is this country prepared to make its firm target irrespective of what the other nations in the international community decide to do?
Baroness Blatch: My Lords, the noble Lord is addressing the point about global emissions. Our contribution to those emissions needs to be seen in perspective. It is only 3 per cent. of the total; therefore 97 per cent. of CO2 emissions are the responsibility of other countries. I have too short a time at my disposal to catalogue all that is being done by this country. It is a great deal. But unless there is a global approach to the problem, whatever we do in this country will be insignificant.
Lord Renton: My Lords, while fully accepting what my noble friend has said, would there not be an advantage in this country setting an example to the rest of the world in this matter as in some others?
Baroness Blatch: My Lords, I believe this country is setting an example in that we have put global warming firmly on the agenda. My right honourable friend the immediate past Prime Minister called the first conference on this matter. That was followed by a number of other conferences. My right honourable friend pressed—I am sure that her successor will continue to do so—for the United Nations to agree to an international convention before 1992. That, together with all the practical measures which have been taken, not least those contained within the Environmental Protection Act which has just been put on the statute book, show that a great deal is being

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done by this country to establish this matter as an important issue. The steps we have taken show our belief, however, that the only way to resolve this problem is through an international global response.
Baroness Nicol: My Lords, do we have a programme for monitoring CO2 emissions in the United Kingdom? If there is such a programme, will the Minister tell us about it? Is the Minister aware of a world programme for monitoring emissions? Do we propose to hold regular meetings to discuss this matter, perhaps every two or three years? If Germany can achieve a target of a 15 to 20 per cent. reduction in emissions by the year 2005, why is this country only seeking to stabilise emissions by that time?
Baroness Blatch: My Lords, the prediction of CO2 emissions by this country between now and the year 2005 is deemed to be 30 per cent. Therefore, even to stabilise at 1990 levels means that a great deal will have to be done. Considerable demands will be made of industry, commerce and all of us to meet this challenge and there will be an impact on the economy of the country. We must keep in mind the balance between sustaining the economy and making a real effort to reduce emissions. I believe that the figures for Germany given by the noble Baroness which predict a level of 7 per cent. are unrealistic.
Lord Harmar-Nicholls: My Lords, not everyone is impressed by the argument that we should set an example. We need to obtain results on this issue for the good of the world. It may well be that in promising to meet certain targets by the year mentioned by my noble friend, providing others follow our example, we may achieve what the world really needs in the most practical way.
Baroness Blatch: My Lords, my noble friend makes an interesting point. It is argued that we have set a realistic target which is achievable but which will make demands on industry and commerce. However, the Government are concerned that the economy of the United Kingdom should not be disproportionately affected in achieving those targets if the rest of the world is not going to co-operate in a global response to the issue. I am absolutely convinced that the Government will continue to press for international co-operation. The Government will also in a practical way do what they can to achieve a realistic target without upsetting disproportionately industry and commerce in this country.
Lord Ezra: My Lords, does not the noble Baroness agree that another reason for the UK to take an initiative is that such an initiative could give rise to useful technical developments which, in view of the worldwide interest in this matter, could have export prospects?
Baroness Blatch: My Lords, that again is an interesting point. We have determined a target that is tough but achievable. We believe that an orderly reduction in emissions gives us time to continue research and the promotion of innovative thinking to resolve this matter. Some of the aspirational targets, as I prefer to call them, are rather glibly talked about.
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They would require almost all our cars being taken off the road; they would require industry to stop producing goods almost overnight. That would be unrealistic and disproportionately disruptive to industry and commerce.
Lord Donaldson of Kingsbridge: My Lords, am I right in thinking that the Answer of the Minister to the Question on the Order Paper is yes?
Baroness Blatch: My Lords, my Answer was not a straightforward yes. I wished to assure noble Lords and people outside the House that the Government are taking a practical and firm approach to stabilising emissions at 1990 levels. As I have outlined, that is a tough target which will make demands on industry and commerce. At the same time I must emphasise that one country alone whose contribution to global warming is only 3 per cent. of the total cannot tackle the problem by itself. Other countries together account for 97 per cent. of emissions. An international co-operative effort is required to make an impact on global warming.
Baroness Nicol: My Lords, will the Minister answer my question about monitoring arrangements?
Baroness Blatch: My Lords, I cannot say specifically whether there is one monitoring body. If I obtain any other information, I shall write to the noble Baroness. However, I am sure that monitoring is taking place all the time in order to define what point we have reached and whether we are making progress on reductions. I shall write to the noble Baroness with more details.
Lord Hankey: My Lords, will the Government bear in mind that nuclear power production produces no carbon dioxide?
Baroness Blatch: My Lords, the noble Lord is absolutely right. The figures for France are so impressive because the French have been courageous and have a buoyant nuclear programme.
Lord Hatch of Lusby: My Lords, two points arise from the response of the noble Baroness. First, the figure which she gave about a 30 per cent. increase is directly challenged by all the scientists involved in this matter. The Government have been giving the figure of 30 per cent., but the scientists have found that carbon dioxide per capita in this country stabilised during the 1980s.
Secondly—
Noble Lords: Question!
Lord Hatch of Lusby: My Lords, the Minister did not answer the question which I asked. I repeat that question. Although we know that it is necessary to have international co-operation, in view of the fact that other governments have set their targets will the British Government do what the Minister said on 12th November that they would do, namely, make a firm target and deliver that target irrespective of what targets are set in other countries?
Baroness Blatch: My Lords, regarding the noble Lord's first point, we shall have to differ on the scientific basis on which the prediction of a 30 per cent. increase in emissions was made. If we do nothing

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CO2 emissions will increase. We can argue about whether or not that increase will be 30 per cent., but we know that there will be an increase. It is our intention that that figure should not increase and that emissions should be stabilised at 1990 levels. However, if the figure turns out to be much lower, as the noble Lord has indicated, as a result of our efforts on the basis of a 30 per cent. increase we shall have achieved more than our target by the year 2005 or even earlier. That can only be good. We intend to adopt a realistic target.
In answer to the second part of the noble Lord's question, I have said more than once that no stone will be left unturned in the practical efforts that this Government are making to bring CO2 emissions to the 1990 level. This means that considerable demands will be placed on commerce and industry. We shall attempt to achieve that objective in a way that is not disproportionately disruptive for commerce and industry in the United Kingdom.

Occupational Pensions: European Court Judgment
2.51 p.m.
Baroness Turner of Camden Baroness Turner of Camden asked Her Majesty's Government:
What steps they intend to take to deal with the confusion that has arisen about occupational pension provision following the European Court judgment in the Barber case.
The Parliamentary Under-Secretary of State, Department of Social Security (Lord Henley): My Lords, there are no simple means by which an individual national government can resolve uncertainties to which particular European Court judgments give rise. We are aware of the difficulties facing occupational pension providers following the European Court judgment in the Barber case and are continuing to give close consideration to ways in which its implications may be clarified. In the meantime we recommend that those responsible for occupational pension schemes take legal advice on the implications for their scheme.
Baroness Turner of Camden: My Lords, I thank the Minister for that response. However, is he aware that the legal advice received by pensions consultants has been conflicting? Is he also aware that there seems to be a great deal of difference of opinion as to whether or not the effect of the judgment is retroactive? There is also confusion as to what schemes should now do. If they equalise their pension ages at 60 they could face difficulties because they are not allowed to introduce bridging pensions for men between the ages of 60 and 65. If they try to equalise the ages at 65 there will be difficulties with respect to women employees because many women will consider that their conditions have become worse. Is it possible to issue guidance to resolve the situation?
Lord Henley: My Lords, I agree with the noble Baroness that the ruling has left some areas unclear, particularly the extent to which it has retrospective
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effect. The Government are considering carefully what needs to be done about the Barber judgment. We do not believe that it is for the Government to make pronouncements about the interpretation of the judgment. In the final resort it must be a matter for the European Court itself to clarify its own judgments. The Government will consider supporting any case which might provide clarification of the ruling.
Lord Stallard: My Lords, is the noble Lord aware that that is not a very satisfactory reply? It is almost the same reply that he gave many months ago when the issue was raised for the first time. If, as a result of the judgment, occupational pension schemes have to provide equal treatment for men and women and in particular equal pension ages, is it not essential that the state scheme should give a lead? What discussions are taking place about the equalisation of retirement ages in the state pension scheme and when will the Government be in a position to announce their decision?
Lord Henley: My Lords, the noble Lord knows perfectly well that the Barber case has nothing to do with the state scheme. The state scheme is specifically excluded under European law: the Barber case concerned occupational pension schemes and defined occupational schemes as pay rather than pensions. The noble Lord said that the judgment did, however, affect the state scheme because of the position regarding bridging pensions mentioned by his noble friend Lady Turner. The United Kingdom's permanent representative to the European Community has written to the Commission on behalf of the Government on this matter. We have not yet received a reply. When we receive a reply and the Commission's views are known we shall arrange for them to be made known to interested parties.
Lord Stallard: My Lords, I must come back to the point. The noble Lord says that the issue has nothing to do with the state pension scheme. The two cannot be divorced. It is almost impossible for occupational pension schemes to operate without taking account of the state pension scheme. The two are interlinked. Because pensions are a long-term business and need a lot of planning, pension schemes have to know what the Government plan to do about the state pension scheme.
Lord Henley: My Lords, I simply do not accept what the noble Lord says. They are totally separate. The Barber case made it quite clear that occupational pensions were deferred pay and therefore under Article 119 of the Treaty of Rome men and women had to be treated equally. Under European law it is possible to maintain separate pension ages. The noble Lord knows perfectly well what the Government's attitude is on the question of the state pension because I spoke on that matter earlier this year in response to the Select Committee report. I said that we recognised the arguments in favour of equalisation but stressed that nevertheless there were many problems relating to demographic and other matters which required careful consideration before we could come to a conclusion.
Baroness Seear: My Lords, does the noble Lord accept that this is a matter of very great importance to a great many people? It is not a party matter. We fully understand the Government's difficulties; on the other hand the whole position is extremely confused. The outcome will affect a great many people and it is very difficult for people planning occupational pension schemes to make sensible decisions. When will the Government be able to say that the position is clear enough for us to have a full debate on this extremely important matter? Will they please expedite the matter on a non-party basis?
Lord Henley: My Lords, I was trying to respond on a non-party basis. I am trying to make it clear that it is not for the Government to clarify a decision of the European Court of Justice. Only the European Court itself can clarify what was meant by the decision in the Barber case. As I said, we are quite prepared to involve ourselves if a suitable case can be found which would enable us to seek clarification from the European Court.
Lord Wedderburn of Charlton: My Lords, will the Minister address this further point? Do the Government not owe an obligation, as the government of a member state, always to consider the judgments of the European Court and to make sure that our domestic law is not out of line with what they understand to be the overriding obligations of the Community? The Minister admitted that the Government have considered the matter very carefully when he said that the Barber case applies to occupational pensions and not to the state scheme. Can the Government not give some indication of their general view of the case?
Lord Henley: My Lords, I said that the decision of the court in the Barber case—and I recommend that the noble Lord looks at it—is unclear, particularly as it affects the degree of retrospection. That is not a matter on which the Government can pronounce. It is for the court itself to clarify the extent to which the judgment is retrospective. In the meantime, as I have said, we advise all pension schemes to take advice as to how it affects individual schemes.
Lord Mishcon: My Lords, does the noble Lord realise that, as the noble Baroness, Lady Seear, and my noble friends on these Benches have said, this is a matter of great concern to a great many people? Does he not understand that it is not good enough to answer that only the European Court can define precisely what it meant and say whether its judgment is retrospective? The Government should take the initiative and bring the matter before the European Court, either by asking for a declaration or seeking some test case. Is he prepared to look into that and provide clarification of an issue which is at present confused?
Lord Henley: My Lords, I suspect that the noble Lord did not listen to me. I said quite clearly that the Government would seek clarification from the court if a suitable case could be found. The Government cannot go to the court and ask for a declaration.
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Another case will have to come before the European Court. The Government will consider supporting such a case.
Lord Mishcon: My Lords, I hope that noble Lords will forgive me for returning to the Dispatch Box. This is an important matter. Is the noble Lord aware that there is a procedure by which one can obtain a declaration from the European Court on an issue which one puts before the European Court? Is it possible to create a test case immediately if that is the route by which he wants to go?
Lord Henley: My Lords, let me repeat that my understanding is that we can seek clarification if a suitable case can be found. We shall support that case if such a case can be found.
Lord Campbell of Alloway: My Lords, is my noble friend the Minister prepared to consider that perhaps there is an area here of serious misconception? Is he prepared to reconsider the position so that the matter is not just left to contradictory advice between individual advisements and that at least some authoritative interpretation, albeit temporary, is made by the Government in order that people understand until the situation changes? Does he agree that the present situation is far from satisfactory?
Lord Henley: My Lords, I made it quite clear that the Government accept that the present situation is unsatisfactory. As I said, the Government are considering carefully what needs to be done. We are in consultation with all the interested parties and with the European Commission. However, in the end, the matter must be clarified by the European Court itself.
Lord Harmar-Nicholls: My Lords, the noble Lord opposite, who is learned in these matters, indicated that a procedure exists whereby we can call upon the European Court to interpret its ruling, short of having a case. Will my noble friend confirm that there is such a procedure as indicated by the noble Lord?
Lord Henley: My Lords, I accept, as my noble friend said, that the noble Lord is learned in the law. My understanding is that we could only seek clarification by means of a test case. If I am wrong, I shall be the first to come back to the noble Lord and make the matter quite clear. However, my understanding is that we can only seek clarification by means of a test case.

Banks: Loans to Property Companies
3.1 p.m.
The Earl of Shrewsbury The Earl of Shrewsbury asked Her Majesty's Government:
Whether the Bank of England has issued or proposes to issue guidelines to recognised banks on the recovery of loans to property companies.
Lord Henley: My Lords, no formal guidelines have been issued by the Bank of England but I understand that the Bank discusses with individual banks the risks associated with loans to property companies as part of their routine, prudential supervision under the Banking Act.
The Earl of Shrewsbury: My Lords, I thank my noble friend for that informative reply. I should first declare an interest in that I work in the property sector. Is he aware that some foreign owned banks which operate within the United Kingdom and which took advantage during the 1980s of the boom in commercial property values to lend to companies when the Bank of England was urging caution are now severely lowering their exposure in that sector, with the consequence that borrowers who still have the support of their other bankers are often faced with premature and unnecessary receiverships?
Lord Henley: My Lords, I note the concerns of my noble friend but feel that the terms under which a loan is made and when that loan should be repayable must be matters for the banks and their customers. It would not be right to attempt to influence the banks' commercial judgment in this matter.
Lord Williams of Elvel: My Lords, will the Minister accept that the noble Earl has raised a very serious problem? The property sector is in deep trouble as a result of the recession. It may have overborrowed in times of boom, but that does not mean that banks should foreclose on their loans automatically and suddenly. Such action will land us in exactly the situation both in the property sector and in the banks that we had in the early 1970s. Therefore will he urge the Bank of England to be a little more active in trying to encourage the commercial banks to nurse companies back to health rather than trying to bring them down on a strict commercial basis?
Lord Henley: My Lords, I note the noble Lord's concerns. The situation is different from that in the early 1970s. Banks now have a far lower proportion of their capital invested in property than they had in those days. As I said in answer to my noble friend, I believe that it should be a matter for the banks and their customers as to the terms under which the money is lent and when it should be repayable.
Lord Morris: My Lords, does my noble friend agree that this is not just a matter of a contract between the banks and the customers? Is it not a very proper role for the Bank of England to issue broad guidelines particularly to foreign banks as to how and in what circumstances they act before they pull the rug from under their customers?
Lord Henley: My Lords, I do not accept that that is the case. As I said, it should be a matter for the banks themselves and their customers. The Bank of England will intervene on other matters, but not here.
Lord Williams of Elvel: My Lords, does the Minister not accept that it is not in the commercial banks' interest to pull these loans? Does he not think that it is up to the banks, together with the Bank of England—they need the reassurance of the Bank of England if they are to nurse companies back to health—in their own interest and the national interest to do this on a gradual and orderly basis? It is not just a question of a contract and closing the contract just like that.
Lord Henley: My Lords, if it is not in the banks' interest to pull the loans, I am sure that the banks will take advice from someone as respected in that field as the noble Lord himself and not pull the loans.
Lord Bruce of Donington: My Lords, does the Minister agree that the Bank of England has already issued notes of guidance to the commercial banks on the lines that have been suggested?
Lord Henley: My Lords, no. Under the Banking Act the Bank has a duty to ask the incorporated banks to give notice of exposure of capital over a certain percentage. It does not have a duty to give guidelines to the banks on when they should ask property companies to repay their loans or whatever.

Business
3.5 p.m.
Lord Denham: My Lords, after the short debate on the volume of fraud in the conduct of affairs in the European Communities and before the short debate on the future of the Commonwealth, my noble friend Lord Caithness will, with the leave of the House, repeat a Statement that is to be made in another place on the Middle East.
With the leave of the House, I should like to say a word about the two short debates standing in the names of the noble Lords, Lord Benson and Lord Greenhill of Harrow. As the mover is allowed 15 minutes and the Minister should rise to reply not less than 20 minutes before the scheduled end of the debate, in the case of the debate in the name of the noble Lord, Lord Benson, that means that all other speeches should be limited to a maximum of 14 minutes and in the case of the debate in the name of the noble Lord, Lord Greenhill of Harrow, they should be limited to six minutes.

Fraud in the European Communities
3.6 p.m.
Lord Benson Lord Benson rose to call attention to the volume of fraud which continues to take place in the conduct of affairs in the European Communities and the case for specific programmes of reform in a number of areas if fraud is to be curtailed; and to move for Papers.
The noble Lord said: My Lords, the substance of today's debate is well summarised in the Select Committee's report, Fraud against tire Community, dated 21st February 1989. The report reads as follows:
"The Committee are deeply concerned by the disclosures in this Report. In brief, these are: the loss of huge sums of Community money each year due to fraud and irregularity; weak financial administration, and the absence of adequate controls in so many areas; the failure to detect fraud and to take criminal and civil action when corrupt practices are brought to light, so that fraudsters are allowed to continue to trade; the failure to deploy the audit function properly; and above all, the absence of political will to correct a damaging situation which has existed for years".
There can scarcely have been a more damaging criticism of a governmental organisation which speaks for 12 first-world countries.
To the best of my knowledge, fraud within the Commission is negligible. The fraud about which we speak takes place in the 12 member states which carry out the Community policies. The Commission has never bothered to ascertain the amount of such fraud but it has been going on for a great many years and various estimates of the amount have been made by different people. They vary between £2 billion and £10 billion every year. The United Kingdom is no better and no worse than the other 11 states.
There is no need for fraud. Each of the big industrial organisations in this country, such as Unilever, ICI, the oil groups and many others, carry on business without fraud taking place within them. They do not carry on business in 12 member states; they carry on business in scores of different countries all over the world. Their transactions are not riddled with fraud because they are carried out by people of integrity and competence, and the audit coverage of their transactions is adequate.
Fraud in the Community is rampant because the competence of the people who carry out Community policies is inadequate and audit coverage is unsatisfactory. The basic reason for that state of affairs is the absence of the political will to stop it in the Council of Ministers. Her Majesty's Government have pointed out many times that they are anxious to combat and contain fraud; but they draw attention to the fact that they are only one of the 12 member states and that it is difficult to persuade the other 11 states to take action. There is truth in that. It is due in some degree to the disjointed and uncoordinated structure of the government organisation in Brussels. In particular, it is exacerbated because we are not told of the intentions or decisions of the Council of Ministers. It is further exacerbated because the European Parliament has a mouth but no teeth.
That is not the only reason. It is true, as I shall explain later, that concerted action from the top is necessary in many cases, but any one of the 12 member states could easily take the initiative in their own territory to, in some degree, contain the fraud that is taking place in their areas.
Those persons who inhabit the corridors of power may take refuge in the fact that in 1988 an anti-fraud co-ordination unit was set up in the Community. The Select Committee pointed out that it could not possibly deal with the subject because the fraud unit has neither the power nor the authority to make the changes necessary. I hope that no one in the course of the debate will suggest that the anti-fraud coordination unit will eradicate fraud in the Community. If anyone were to do so, I fear that they would be misleading themselves and, worse still, they would be misleading the House.
Fraud and irregularity in the Community can be stopped only by concerted action taken by the Council of Ministers, the Commission and the 12 member states working together on an agreed programme. There is nothing vague or doubtful about the nature of that programme. The Select Committee pointed out with unassailable logic that if fraud is to be contained,
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the causes of fraud must be removed. By analogy, if aeroplane crashes arise because there are structural weaknesses in the aeroplane, the structural weaknesses must be removed or the crashes will continue.
The Select Committee itself identified 13 major causes of fraud in the Community, and there are others. All will have to be tackled separately and eradicated. It is a most considerable problem. It will take a year to prepare the programme, and about five years to implement it. It should also be the subject of an annual report by the Court of Auditors to inform the public and the Community as to whether the programme is up to date. No government department, no Minister, no institution, no member state, no individual has, as far as I know, ever formulated the outline of such a programme and put it before the Council of Ministers and the other institutions affected so that the appropriate decisions can be made.
On 13th April 1989 the noble Lord, Lord Belstead, said in this Chamber that he hoped that such a programme would be devised and its implementation monitored. Nothing has been done. It is a formidable task and it needs the help and skill of professional lawyers and accountants. I gravely doubt whether the Commission or any of the member states, including this country, have the necessary administrative skills to handle the job properly. Perhaps I may therefore put a question to the Minister who will answer the debate: when will such a programme be prepared? Will it be monitored by the Court of Auditors, as suggested by the Select Committee?
What I have described so far is only one reason why fraud is rampant in the Community. Every organisation which engages in financial transactions finds it necessary to have those transactions reviewed by independent auditors at least once a year. The Court of Auditors in the Community was set up in 1977, largely on the initiative of the United Kingdom, and it has done good work; but both resources and objectives now need to be restructured. What is of imperative importance is that the Court of Auditors should have the right, and exercise the right, to pursue its inquiries in the member states and then to report accordingly. If it cannot do that on its own account, it should do it through the medium of the Audit Office in the territory concerned.
The precise changes needed in the structure of the Court of Auditors are set out in paragraphs 196 to 203 of the Select Committee's report. The House will also have noticed last week when we debated the report prepared by the committee under the chairmanship of the noble Lord, Lord Aldington, that it drew special attention to the need to restructure the Court of Auditors to remove the present deficiencies. Perhaps I may now put a second question to the Minister: will he tell the House when that restructuring of the Court of Auditors will take place?
There is a third reason why fraud is rampant in the Community. For years the Council of Ministers has not dealt properly, or at all, with the serious criticisms which appear in every report that the Court of Auditors writes. If directors of industrial organisations in this country behaved in a similar way their

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efforts would soon be the subject of a DTI inquiry or possibly even of the Serious Fraud Office. Perhaps I may put a third question to the Minister: will he tell us when the Council of Ministers will be prepared to accept that basic responsibility for financial administration which rests on its shoulders, and when will it be willing to alter its ways?
Fraud in the Community is a growth industry. It will not stop of its own accord. It will not go away. It is like a cancer eating into the body of the Community. It needs relentless determination to get rid of it. I shall quote the short penultimate paragraph of the report:
"The huge sums which are being lost due to fraud and irregularity against the Community are losses borne by all the taxpayers and traders of Europe. This strikes at the roots of democratic societies, bound as they are on the rule of law and its enforcement, and is a public scandal".
In the past two years while the subject has been before the House, I have gained the impression that no fewer than four or five Ministers have been dealing with it. Indeed, the evidence given to the Select Committee was that there was no consistency in the individuals who represented the United Kingdom in Europe when the matter was under consideration in Brussels. I cannot help feeling that this subject is being shunted about from department to department and from Minister to Minister because nobody is prepared to handle a hot potato. I shall put a fourth question to the Minister. Which government department and which Minister has been responsible during the past two years for cleaning up this public scandal?
It may help to focus the debate if I repeat the four questions that I have asked. I do not do so because I wish to weary the House with repetition but for a particular reason. On numerous occasions during the past two years the Government have been asked to publish a White Paper and they have resolutely refused to do so. That was an unwise and imprudent decision because, if we are on notice of a public scandal which has been continuing for many years, both the public and Parliament are entitled to know how the Government intend to deal with the matter. It follows that, if the Minister is able to give strong and affirmative answers to my questions, the House can be assured that in due time fraud will be contained, although it may take years. However, if the answers are weak and indeterminate, the House will be on notice that fraud and the public scandal will continue unabated for many years to come.
I shall repeat the four questions that I asked. When will a comprehensive programme of reform and an annual report from the Court of Auditors upon that be introduced? When will the necessary changes in the powers and functions of the Court of Auditors be introduced? When will the Council of Ministers observe accepted standards of financial administration and deal properly with the auditors' criticisms? During the past two years, which department and which Minister has been charged with the task of eliminating this public scandal? My Lords, I beg to move for Papers.
3.22 p.m.
Lord Campbell of Alloway: My Lords, your Lordships will be grateful to the noble Lord, Lord Benson, for his authoritative exposition and for introducing the debate. He explained the formidable professional task which lies ahead in preparing a programme and he gave an estimate or five years for implementation. It is my purpose to concentrate only on certain aspects of that programme.
Before doing so, it is with respect that I suggest to the noble Lord that any criticism of Her Majesty's Government in this regard, or any particular department of state, is wholly wide of the mark. On any objective analysis, the true criticism lies with the Council of Ministers for lack of political will without which no single member state can make any progress.
The debate takes place in the wake of last Thursday's main debate on this 27th Report. For the sake of accuracy, today's debate is concerned with paragraphs 130, 166 and 167 and recommendation 217 of that report. In last Thursday's debate they were endorsed by the Minister who said that the roles of the Court of Justice and the Court of Auditors should be strengthened and that national parliaments need to be more involved in national life. For want of time only the noble Lord the Leader of the Opposition assented to that suggestion sub silentio. In that context, my noble friend Lord Aldington said that the Court of Auditors and the European Court of Justice must be given the resources and structure to do their job properly.
This subject raises no political issue which divides your Lordships' House or another place. The singular and strenuous initiative on Community fraud taken by my right honourable friend the immediate past Prime Minister commands a tribute from all sides of your Lordships' House, and from all subjects and citizens in all the member states of the European Community. I shall deal with the reason why that initiative failed in a moment. In this context, it is not to the point what form of monetary system or systems may evolve in the European Community. The point is that the foundations of any monetary system are eroded unless steps are taken to tackle and debilitate the hydra; that is, Community fraud.
Over the years my right honourable friend saw that as of the order of priorities together with agreed cuts in farm subsidies—that fertile field for Community fraud—and rightly so. The hope must be that my right honourable friend the Prime Minister will bring that initiative to a speedy and successful conclusion. The report of the Select Committee stresses the urgency of the situation and refers to three previous reports of your Lordships' Select Committees: the Sixth Report of 1986–87, the Court of Auditors' Report of 1988–89 and the Fraud Against the Community Report of 21st February 1989. That is the report to which the noble Lord, Lord Benson, referred and which vents deep anxiety about the losses borne by all taxpayers and traders in Europe occasioned year by year by fraud, irregularity, weak financial administration and absence of adequate controls. In its 27th Report your Lordships' committee concluded that none of the

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evidence heard conflicted with the evidence given to the Court of Auditors' Select Committee. When the Council of Ministers reports to the European Parliament, as it must each year, on the Court of Auditors—and I quote,
"they should state what action should be taken and if none, why not".
Why not, indeed? The reason why the Council of Ministers spurned the initiative of my right honourable friend in this regard, and on occasions juggled with the agenda, is not shrouded in the mist of speculation. As the noble Lord, Lord Benson, truly stated, fraud takes place in the member states. The reason is all too plain. The member states are unwilling to foot the Bill to set up the requisite structure and resources or indeed to accept on behalf of each member state the substantial cost of sanctions in default.
Therefore, the immediate priority is to generate at the Council of Ministers the political will to which the noble Lord, Lord Benson, referred. Unless that is done, it is no use complaining that Her Majesty's Government under this, that or any other administration have not done enough because one cannot do anything at that Council of Ministers' level unless the political will is generated. The criticism lies there.
Also, there must be the will to set up an effective system of administration and control, and to establish a system of effective sanctions against member states whose institutions are found to be in default. To that end, subordinate legislation, directives and regulations must be introduced at Community level, and primary implementing legislation must be enacted in each of the member states.
No doubt other noble Lords will consider in some detail the recommendations in paragraph 183 of the Fraud Against the Community Report and paragraphs 166 and 167 of the 27th Report. It would not be right to weary your Lordships with the details, and I do not propose to do so. However, it is plain beyond doubt that in order to control that criminal and highly profitable activity, sanctions must be introduced which bite on the budgets of the defaulting member states. Also, the Court of Auditors must be able to implead defaulting institutions and member states in the Court of Justice. Powers of investigation of the Commission into the operation with the Court of Auditors and the national authorities must be increased. The national authorities must have sufficient resources and trained staff to afford effective supervision of domestic controls.
I ask the Minister to confirm that the magnificent initiative, although it failed, which was taken by the Thatcher administration will not be allowed to abate or lie fallow under this Administration, and that it will now be pursued with the utmost vigour at Council of Ministers' level. I ask also, because it is such an important subject, that progress or lack of it may from time to time be reported to your Lordships' House.
3.34 p.m.
Lord Bruce of Donington: My Lords, the House will have good cause to thank the noble Lord, Lord Benson, for taking this opportunity once again to raise the question of fraud which was dealt with nearly two years ago by the Select Committee under the able chairmanship of the noble Baroness, Lady Robson of Kiddington.
The noble Lord, Lord Benson, has been a tower of strength in these matters. In this House during the past 18 months he has consistently raised this question and I feel confident —and I offer my own support to the noble Lord in this respect—that he will not rest until some effective action is seen to be taken in this sphere.
In his remarks the noble Lord mentioned, as did the report to which he referred, the crucial importance of the reports produced from time to time by the Court of Auditors. Perhaps it is rather unfortunate that by the time those reports are eventually available, it is one year after the year to which they refer. The matters have then tended to become somewhat obsolete. Immediate steps should be taken to ensure that the Court of Auditors' report is published immediately on completion rather than having to wait for many months for the observations of the Commission on the report. That takes many months to prepare and it ensures that the report is always long delayed. There is no reason why the Court of Auditors' report, damning as some of those have been, should not be made available immediately. In this country when a committee reports, the report is published and the Government submit their own observations somewhat later in a separate document. That practice would mean that every auditor's report could be considered on its own merits without having to wait for the replies of the Commission.
I do not wish to go into the matters already covered by the noble Lord, Lord Benson, because time does not permit. However, one matter is certain and is revealed in the Select Committee's report. The greater part of fraud, running into billions of pounds, arises from the operation of the common agricultural policy, and in particular that section of it which deals with export rebates; that is, compensation is given to exporters, to third countries outside the Community, at a rate which will not compete internally with the price of the food which is exported. Those export rebates paid to producers in this country are frequently many times the world price at which they are sold. That creates consequences, which are impossible to deal with in the limited time, on the food markets of the world and in particular on the part played by developing countries in those markets.
It is sufficient to say that as long as the common agricultural policy system operates, and in particular the system of export rebates, there is an open invitation to fraud. That has not in any way mitigated since the Select Committee's report was published over 18 months ago in February 1989. We learn from The Times on 10th November that food mountains are once again accumulating. I shall not read out the figures because that takes time but those figures can be

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studied in the edition of The Times to which I have referred. Beef, butter and all kinds of food mountains are beginning to accumulate on a scale similar to that which existed three or four years ago, before the Select Committee's report was published. Once again the opportunities for fraud arise.
One matter that exasperates the noble Lord, Lord Benson, and me is the apparent inactivity that has existed since the matter was first drawn to the Government's attention. It was drawn to the Government's attention long before the setting up of the Select Committee on fraud. Your Lordships will recall that I raised the question of fraud in the Community with the noble Lord, Lord Young. His reaction was to minimise it. When the Commission was visited in Brussels as part of the investigation, its reaction was also to minimise the significance of the matter.
What is required is for Her Majesty's Government to treat the fraud that takes place within the territory of the United Kingdom as a serious crime worthy of serious investigation and with a view to the strict enforcement of the law. That is what is required, and what occurs when fraud arises in other fields; for example, in social security. Some of the poorer sections of our community are quite rightly prosecuted for fraud in connection with social security payments. The whole might of the state descends upon them. Hundreds of new inspectors are appointed.
What happens in the European Community? I discern that so far the attitude of the Government towards fraud in the Community and in regard to the common agricultural policy involving billions of pounds is not to treat it with the same degree of seriousness with which minor crimes in the country are treated. It is time some effort was made involving expense and the reinforcement of the police and prosecution authorities in order that that attitude may be changed. Instead, as we are likely to hear again this afternoon—I do not wish to anticipate the noble Lord—we shall hear soothing words regarding the kind of organisational arrangements that are likely to be put in motion in the next year or so, the kind of governmental consultations that are taking place, and the kind of new committees that are being considered. What is required is action.
The noble Lord, Lord Benson, referred to political will. I do not believe, and I challenge contradiction, that there is the political will in the Council of Ministers necessary to tackle the problem. There is a tendency among member states to regard the frauds committees within their territory and enjoyed by their citizens, corrupt though they may be, as part of their own national pay-off out of the CAP.
In that connection, it is of particular interest to the United Kingdom. There is a two-tier Europe that is not mentioned. The first tier are countries that pay. The Federal Republic of Germany contributes between £3.5 billion to £4 billion per annum to the Community budget, and the United Kingdom contributes £2.2 billion every year. The second tier
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comprises the remainder that receive. I have no doubt that the enthusiasm in the countries that receive is not as intense as that among the countries which pay.
The problem is long-standing. It did not even begin at the time of the meetings that took place, and which were commented upon by the Select Committee, on the control of Community finance. At that time it was proved beyond all reasonable doubt that the council, as a council, had no real will to control Community expenditure. It is time that the problem was taken seriously. I sincerely hope that the Government will at long last pay attention. They may not pay attention to me even though I, together with my colleague Sir Michael Shaw, drew it to the notice of the European Parliament as long ago as 1978 and 1979 in a report to which I can draw the attention of noble Lords. Something must be done now. I hope that at last the Government will be able to give some satisfactory reply to the very important contribution made to the debate by the noble Lord, Lord Benson.
3.45 p.m.
Lord Templeman: My Lords, the members of the judicial committee of your Lordships' House have a good deal of practical experience of fraud, of its ramifications both in this country and abroad and of its serious effects on the innocent people who suffer from it. I hope therefore it will be thought appropriate that I should rise to support the work of the sub-committee and express the hope that the many necessary reforms indicated in the report will be actively pursued.
The suspected scale of fraud in the Community is shattering. The estimates vary from £2 billion to £6 billion a year, or 10 per cent. to 15 per cent. of the Community budget, although one characteristic of fraud is that its scope is incapable of measurement. Moreover, fraud begets fraud. Unless detention and punishment are swift and sure the problem is bound to become worse.
In the report there are four principal reforms for the containment and reduction of fraud in the Community to which I should like to draw attention. The first is the reduction of the incentives and opportunities for fraud by a reduction in the expenditure of the Community and the need to raise revenue. Fraud is practised in connection with expenditure and also in connection with revenue. Therefore a reduction of both is bound to lead to a reduction of fraud. In most cases the reduction of expenditure will have the effect of removing an obstacle to free trade and fair competition.
In the report the remarks of Mr. Carey, the United Kingdom member of the Court of Auditors, and Mr. Tomlinson of the European Parliament drew attention to frauds practised in connection with export refunds. In paragraph 74 they say that the solution lies in lowering Community support prices. The report continues:
"It was the fact that these were so much higher than world prices that determined the huge sums involved in export refunds. This created the incentive to manipulate the system. A huge proportion of a trader's income could be made up of export refunds".

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As long as support prices continue at the same level, administration of export refunds will continue to entail a significant risk of fraud as well as substantial budgetary costs. They say that if we reduce the incentive we shall reduce the fraud.
The second main reform proposed in the report is the simplification of regulations. Paragraph 27 on page 12 deals with the common customs tariff. There are 4,000 product codes for agricultural goods alone; for processed goods there are 932 product codes, 1,416 standard recipes and 14,000 non-standard recipes. That degree of precision allows different levies for biscuits depending on the cereal, milk, fat and sugar content. But it also increases the complexity of the system for customs authorities and traders alike and the scope for fraud due to misdescription. One can imagine the traders picking their way through the regulations trying to find something to enable them to pretend to fall into one category rather than another.
The same is true of export refunds. They vary between 11 zones. In paragraph 60, on page 70, the committee comments that four companies in Denmark were estimated to have netted £530,000 by pretending to send goods to one zone—namely, the Caribbean—but in fact sending them to the United States. The report refers, at paragraph 63, to 3,000 regulations giving, in the words of Mr. Tomlinson,
"a 'flood of legislation' leading to a 'chaos of ill-understood paper'".
It is perhaps not surprising that if the United Kingdom Customs and Excise advice to traders was placed in a pile it would be seven inches high. It is inevitable that there will be discrepancies and inconsistencies between member states and that the opportunities for fraud and irregularities will be enhanced. In other words, the more complicated the system, the more the fraudster can pick his way between one return and the next.
The third principal reform is the improvement of machinery for the detection and punishment of frauds. Paragraphs 33 and 66 refer to the need for more frequent and more detailed customs examination, though it must be said that that would cause delay and resentment. It is always difficult to strike the right balance between sufficient examination, particularly at the borders of states, and causing more resentment than the inspections are worth.
Paragraph 94 draws attention to the criticisms made by the European Court of Auditors on the checks on documents made by member states. For example, in 1987 some 80 irregularities were discovered in Italy but practically none in Denmark or Greece. The charming picture conjured up by that statistic of all the innocent Danes and Greeks basking on the beach while only the wicked Italians are practising fraud is quite misleading. The statistics on what is reported bear no resemblance to the actual incidence of fraud in any one country. I do not suggest that Denmark and Greece are any worse than others, but I decline on that evidence to believe that they are necessarily much better than others. In that respect, as the noble Lord, Lord Benson, pointed out, there is
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substantial fraud in this country. It does not extend (as most evils always extend in the Community) to all the other member states except the one to which one belongs.
Paragraph 97 refers to the need for the exchange of information between member states. The Serious Fraud Office describes speedy co-operation as absolutely essential. There is no real drive in the machinery to ensure that what one member state discovers another is informed about. Therefore, one fraudster may be under investigation and regarded with heavy suspicion in one state while another state is handing out subsidies to him with a free hand as though he were as white as snow.
The fourth proposed reform is an increase and improvement in surveillance by the European Court of Auditors, the Commission, the European Parliament and national parliaments. It is clear that the whole of this work of detection and punishment depends on everybody using their best endeavours and playing their part. I do not accept the words of the noble Lord, Lord Bruce of Donington, who was inclined to think that the world is divided into 11 fraudsters and two innocent member states. Fraud is endemic throughout the Community, in countries which pay and in countries which receive. I agree with the noble Lord that it is a great pity that we should pay more than we receive, but that does not measure the long-term benefits arising from the Community. The Community is our ticket; we pay for it and we receive extraordinary benefits from it.
Paragraphs 183 and 186 to 203 summarise the main proposals. It is fair to say that if all those proposals were carried out with the speed for which the noble Lord, Lord Benson, is pressing a very great improvement would take place. I echo the words of the noble Lord, Lord Benson, who spoke of fraud as a cancer eating away at society. Fraud and corruption go hand in hand and we can see in many parts of the world whole societies being ruined, not only economically but morally and materially, by corruption and fraud which it is impossible to stop. The more fraud there is, the more tempting it is and the more difficult it is for states to assert themselves and restore an element of order.
I commend this report to your Lordships and I sincerely hope that it will be put into effect.
3.56 p.m.
Lord Bethell: My Lords, I join with noble Lords in congratulating the noble Lord, Lord Benson, on his initiative in introducing this debate on a vital subject affecting every citizen in the European Community. The noble Lord indicated that European Community fraud could be as high as £10 billion a year. The noble and learned Lord, Lord Templeman, suggested that it might be as high as £6 billion a year. The discrepancy in the figures indicates the enormity of the problem and the fact that we do not know how large it is. Certainly, however, it is very large and every possible effort must be made to combat it.
The noble Lord, Lord Benson, said that the European Parliament has a voice but no teeth in this

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matter. With respect, it would be appropriate for me to clarify the European Parliament's role in this problem, as I see it, and to show that in Strasbourg and Brussels we have certain ways of assisting the other institutions and national parliaments in the struggle against European fraud.
Many noble Lords will recall the result of the hearings held in the European Parliament in January 1989 which gave widespread publicity to the problem throughout this country and the Continent. The estimates given in the debate of the billions of pounds a year and the 10 or 15 per cent. which may be lost through fraud gave an impetus—a burr under the saddle, so to speak—to those who are endeavouring to bring this matter from the back burner to the desk where it needs to be tackled.
The European Parliament, therefore, has a role in invigilating and in supervising the institutions of the Community; to some extent the Commission, but mainly the Council of Ministers which does, after all, report to the European Parliament on a regular basis in this regard. The European Parliament has a role in forming the legislation which is often misused by the fraudsters. Together with the Council of Ministers' working groups and the Ministers, who eventually have the last word in most of the laws, the European Parliament can make sure that laws are put together in such a way as to make fraud more difficult. I hope your Lordships agree that what is required is not so much detection and punishment but prevention. At present the laws are so complicated that it is difficult to deal with fraudsters and much easier for the criminal to exploit loopholes.
It will not be easy for the European Parliament or, indeed, for the Commission, to deal with any problem of detection and prosecution. The unit for the fight against fraud, set up by the Commission in the wake of the European Parliament hearings, is a step forward, but it has only 20 people working for it. It has had some successes, in particular in dealing with fraud that involved fish passing through Greenland and machinery that was diverted from Bulgaria via Malta. That involved hundreds of thousands of pounds rather than the millions or billions of pounds mentioned by previous speakers.
A small unit such as the one that the Commission has set up cannot be a kind of super-European FBI, a troubleshooter to deal with the criminals and to put them where they belong. It should be the main function of the Commission in this area, helped by the European Parliament, to make the laws more simple and appropriate for dealing with fraud and for making it harder to commit.
For instance, there should be provision in law for the checking of documents in order that fraudsters may be more easily caught. It should be possible to check suspicious cargoes and transactions against bank accounts; it should be possible to check suspicious transactions against manifests and movement orders involving ships, aircraft and trains. In this way it would be possible to prosecute certain criminals. The knowledge that such checks were
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taking place would, I hope, be a deterrent to the criminal and discourage him or her from embarking on fraud in the first place.
Previous speakers have rightly indicated that the main duty lies with the Council of Ministers. It is a fair point that one cannot look at a country's list of criminals and prosecutions and say that that country is more guilty than another because it has so many more cases. The opposite may be the case. The absence of cases of fraud may simply mean that the authorities in the country in question are doing nothing about it.
As regards the forces of law and order, there is a limit to what the national parliament or government can do about the problem in each country. The legislature is not charged with the enforcement of law and order. It can invigilate, supervise, and encourage and press Ministers. The main burden in this country must be on HM Customs and Excise and, in the final analysis, on the police. I hope that at the end of this debate the Minister will be able to give some information about how the customs and the police are faring in their struggle against European Community fraud in this country. If there are any hints or tips that he can suggest that might be brought to the attention of other governments about how their forces of law and order can tackle this kind of crime, that would be very useful as well.
I have some sympathy with the previous speaker who said that the problem will not go away until we have finally settled the question of serious agricultural surpluses. When there is opportunity for serious crime and for the making of huge illegal profits, then criminals will always be found who will exploit it. In a similar way, it is hard to see how the drug traffic will be stamped out. So much money is available to be used in that traffic. It is not easy to see how the agricultural aspects of EC fraud can be done away with so long as the export rebate system remains as it is.
I am encouraged by the thought that certain steps along the road to doing away with massive export refunds are being taken even though the agricultural surpluses have now unhappily returned. I believe that member states have come round to the view that a system of extremely generous export refunds in agriculture is inappropriate and that over a period of years it should be phased down or even phased out. Then the incentive for large-scale EC fraud in agriculture would no longer exist.
I believe that the European Parliament does have a role to play in this important matter. EC fraud shocks the people who elect us to the Strasbourg parliament. As taxpayers they are quite right to be shocked at the thought of their hard-earned money going into the pockets of criminals. I hope that we shall work together with the other institutions and national parliaments in order to see that this scourge is finally done away with.
4.6 p.m.
Lord Seebohm: My Lords, it has already been pointed out that the question of fraud and negligence—there is very little difference between them—was

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considered by the Select Committee in 1988. There was a debate in your Lordships' House in April 1989. There is no point in having a rerun of that debate today. It may be thought that it is a little early to raise the matter again. However, the subject is so serious that it cannot be allowed to drift any longer. Therefore, I am sure that my noble friend Lord Benson is absolutely right in raising it once more.
By way of introduction I shall quote a short extract from evidence given to the Select Committee by Mr. John Tomlinson, MEP, in answer to a question put by the noble Lord, Lord Bruce of Donington. Mr. Tomlinson said:
"When I see the extent to which governments can find the time and the will and all the other ingredients to pursue arguments over relatively small amounts, I feel it amazing that they cannot find the same degree of time, energy and effort over the amount of money that is leaking from the Community budget to the detriment of member states and individual taxpayers".
He went on to say:
"I would particularly refer to a study that was done in Sweden by the National Crime Prevention Board where they examined the whole import and export trade through a number of custom points over a period of time and their estimation was that there was 50 per cent. of fraud or negligence in the transactions".
Admittedly, Sweden is not a member of the Community, but most of its trade is with the Community. If fraud continues on that scale in Sweden, it is likely to be even greater elsewhere.
What was more illuminating was the evidence given by Professor Tiedemann, who had made a special study of fraud in Germany. He estimated that the equivalent of £3 billion to £5 billion of fraud took place in that country annually. It appears that as the loss is to the Community budget and not to the member state there is no incentive or will to attack the problem or even to convict criminals when they are caught. I suppose that there is a natural tendency in all countries to cheat the public sector, whether it is transport, taxation, or whatever, and to treat it as fair game. The practices in the Community are completely unacceptable.
At the time of the inquiry the total complement of the European Court of Auditors was 300, and of those 65 were totally occupied in translating documents into the nine languages of the Community. It also included secretarial and administrative staff. What has happened since? An additional inspectorate of 100 would cost peanuts in comparison with the money at stake. Another powerful weapon that could and should be used is maximum publicity for the findings of the inspectorate. Such information should be given to the press. I can imagine an interesting regular column in the Financial Times and perhaps even in the Daily Mirror. However, internationally this vast monetary problem must be tackled systematically.
I suggest that figures should be reported monthly to ECOFIN and to the appropriate committee of the European Parliament. I also hope that a full report will be given annually to both Houses of Parliament. I trust that similar action will be taken by other member states and that possibly references will be
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made to the IGC. According to the figures given by the noble and learned Lord, Lord Templeman, we are talking about frauds which could amount to 15 per cent. of the total Community budget. I believe that the figure could be far higher. Member states should be required to give the court whatever information it requires from the national audit bodies and the relevant departments to carry out its task. I look forward to hearing the Government's reply to the debate.
4.10 p.m.
The Earl of Perth: My Lords, when the noble Lord, Lord Benson, asked me whether I would take part in the debate I hesitated. He is a very old friend of mine; he and I used to work together when he was head of Cooper Brothers. I felt that I had to take him seriously. That being the case I read the report and its proposals for putting a stop to the vast frauds which go on in the Community and which hitherto have gone on virtually unpunished. I am speaking today because the noble Lord, Lord Benson, asked me to do so and because it is clear that something must be done, and done soon.
I have a second reason for speaking. I am a strong supporter of and believer in the European Community. I worked closely with Jean Monnet—the father of Europe—before the war. After the war, although I no longer worked with him in the same capacity, I was naturally anxious to see his good work succeed. I am sure that, if he were now alive, he, who was essentially a practical man, would back all that has been said today on the need for the Community and the member states to put their house in order. I knew, as many noble Lords knew, that some kind of racket—I use the word advisedly—was going on in the agricultural world. One heard about cattle being driven across a border and then being driven back again. It was perhaps something to joke about.
Most people in this country and in the Community have no conception of the degree of damage and the cost to the taxpayer resulting from such fraud. If they did know—and they ought to know—we might expect a much stronger reaction. One has the feeling, as the noble Lord, Lord Bruce of Donington, and other speakers have said, that member states do not care too much. I hope that the noble Lord is wrong. I am sure that if we could make clear what is happening there is a good chance that the problems could be put right. One of the real troubles is the complexity of the regulations. I suggest that the European Community and all its parts should pause in the good work they are doing and look at what is happening now. If they did so, a great deal could be done in the way of simplification. We should simplify matters and make the regulations less complicated and more easily understood.
The top priority must be to stop corruption. The Council should consider pausing for a moment and getting down to this important business. The noble Lord, Lord Bethell, said that a fraud squad of 20 members has recently been appointed. That figure is a joke. We do not want to see unnecessary staff and bureaucracy, but that consideration does not apply in

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this case. What does it mean? If the fraud squad does its work properly—and I feel confident that it will—we shall benefit greatly.
I only wish that the media would pay more attention to this question. It is perhaps unfortunate that there has been so much on other affairs to occupy them over the past week. I do not blame the media for that but we must try in every way to ensure that what is happening is widely known. This debate should help matters along. Perhaps the new Prime Minister, hot from the Treasury, with the help of, let us say, Mr. Hurd, if he is Foreign Secretary, will agree that in this area we should do all we can for the member states and for the Community.
The noble Lord, Lord Benson, and others referred to the need for political will. I am sure that that is right. The noble Lord asked four questions of the Government. I believe that a fifth question should be asked. Will the Government give an undertaking that they will make an annual report to both Houses on the progress being made, or not being made, in relation to fraud matters? If they do so, I hope that they will be able to give us many facts and figures. That is one of the problems. We have insufficient information about what is happening, and, as these matters are criminal, the information is kept under the blanket.
4.18 p.m.
Baroness Robson of Kiddington: My Lords, the report of your Lordships' Select Committee on fraud against the Community, published in February 1989 and debated in this House on 13th April 1989, put forward far-reaching proposals as to the remedies needed to deal with the problem. It also set a timetable of two to five years for the implementation of those proposals. When introducing the report for debate in the House, I concluded with the words:
"I suggest that within a year or 18 months a further debate … should take place to see where the Community has reached and what our further contributions should be".—[Official Report, 13/4/89; col. 432.]
I am therefore deeply grateful to the noble Lord, Lord Benson, for giving us this opportunity today to review progress exactly 18 months after our last debate.
I was sad not to be able to be present in the House last Thursday when the Select Committee report on European monetary and political union was debated. I was abroad at the time. I have read very carefully the speeches made in the debate. I particularly welcome the proposals in the report in relation to the Court of Auditors. The report on monetary and political union contained an additional proposal which did not appear in the report on fraud in the Community. I refer to the recommendation that the Court of Auditors should be asked for advice on how, when drafting new legislation for implementation by member states, the risk of fraud can best be avoided.
I agree 100 per cent. with the noble Lord, Lord Benson, that the causes of fraud, where they exist today, must be removed. However, we must also be careful that we do not create new causes of fraud by introducing legislation which contains loopholes. Incidentally, the practice of consulting qualified chartered accountants and auditors is a practice which
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takes place in this country when the Treasury consults the Institute of Chartered Accountants on the Finance Bill. Therefore, there is a precedent for following that exact procedure.
Initially, after the publication of the fraud report, in meetings with the noble Earl, Lord Caithness, there seemed to be real concern about the problem and some remedial measures were taken. One of them was the reduction in the number of product classifications in the field of agricultural goods from the ludicrous 14,000 non-standard codes mentioned by the noble Lord, Lord Templeman, to 4,000 codes. Nevertheless, by no means enough has been achieved.
However, it is not only classification; something must be done about the export refunds which are paid at different levels when the export takes place in different countries. Mr. Carey, the British member of the Court of Auditors mentioned the following ludicrous situation in a speech on 19th April 1990. If a country exports cheese—for example, Parmigiano Reggiano, a special kind of cheese—which is,
"not grated or powdered of a fat content by weight not exceeding 40% and a water content calculated by weight, of the non-fatty matter not exceeding 47% [it] would attract a refund weight of 190 ECU per 100 kg if exported to Sweden but zero if exported to Norway and Finland".
If anyone can tell me what is the difference between Sweden, Finland and Norway—and I come from one of those countries —I should like to know. This is a situation which we must remedy.
Some most important proposals in the fraud report have not been implemented. There does not seem to have been any increased use of publicity when cases of fraud are detected. Many recommendations in the report may necessitate legislation, but an increase in the level of publicity when fraud is detected would not necessitate legislation. Such measures could be taken as from this moment. However, this has not happened. I suggest that one of the greatest forms of deterrent to fraud is the risk of it being publicised. Moreover, so far as I know, no move has been made to reform the system of advance payment for FEOGA guarantee expenditure. These advance payments act as a disincentive for member states to pursue fraud, as the state suffers a loss if the fraudster goes bankrupt or cannot be traced.
Above all, as the noble Lord, Lord Benson, so ably stated, there seems to be no evidence that the Community has initiated any real re-thinking about the audit function within the Community. There is a crying need for an increase of staff in the Court of Auditors if it is to be able properly to monitor the reports of the national audit authorities.
As many noble Lords have said, the Council of Ministers still seems to lack the political will to take proper note of criticisms and recommendations made in the reports of the Court of Auditors; for example, giving reasons why no action is to be taken in certain cases. I should have thought that that was the least we could expect. Although the Commission is now committed to preparing an annual report on fraud, I

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believe that it would have been preferable, and much more appropriate, if a strengthened Court of Auditors had carried out that task.
The possible enlargement of the Community by entry applications from the EFTA countries puts new pressure on the need for a thorough review of the remedies required to combat fraud against the Community. I have just returned from an eight-day visit to Stockholm. The change in attitude in the countries of the North towards entry into the European Community was very much in evidence. I believe that within the very near future an application will be submitted by Sweden to join the Community. When we enlarge the Community, we must ensure that we have a Community which is financially sound and one where the accounting of its resources is not subject to fraud.
Finally, we are approaching 1992 and the completion of the open market in Europe. Therefore, it is most imperative that the problems of fraud against the Community are tackled with all the energy that we can muster. Unless all the Community countries have adequate systems for the control and detection of fraud by that date, the problem will only increase when the borders are removed.
4.27 p.m.
Lord Williams Of Elvel: My Lords, the House will be grateful to the noble Lord, Lord Benson, for bringing this very important matter to your Lordships' attention. As other noble Lords pointed out, the subject was debated in the House on 13th April 1989. The central point behind the noble Lord's Motion is to ask what has taken place since that time. We look forward to hearing the Minister's reply and hope that he will be able to tell us exactly what has happened.
As the noble Lord, Lord Benson, rightly pointed out, fraud against the Community is not an abstract matter; it is fraud against taxpayers in the Community. In other words, someone has to pick up the bill. That is why it is qualitatively of great importance. However, it is also quantitatively of great importance, as the noble Lord and others pointed out. The Community budget now stands at something over £30 billion per annum. If any of the estimates advanced this afternoon—that is, anything between £2 billion and £10 billion per annum—are right, we are talking about fraud which represents something between 8 per cent. and 30 per cent. of the total Community budget. I cannot conceive that any of your Lordships would wish to work for a commercial undertaking where 8 to 30 per cent. of its profit and loss account was entirely due to surreptitious and illegal transactions of which no one was aware. That is the scale of the problem. Perhaps I may take the point a little further. Even the lower estimate of £2 billion per annum is one-and-a-half times the total net income of British agriculture. Therefore, it is a major problem and one which the noble Lord, Lord Benson, is quite right to bring to our attention.
As noble Lords have pointed out—especially my
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noble friend Lord Bruce of Donington—the majority of incidents of fraud take place within the common agricultural policy. It is a curious feature of the policy that farming incomes are falling but consumer prices are still well above world prices. That itself is a very astonishing achievement. Worse than that, and worse than the opportunities it gives for fraud, as the noble and learned Lord, Lord Templeman, pointed out, is the threat to world free trade. It is a fact that the progress of the Uruguay round in GATT will very much depend on some sort of reduction in the long term in subsidies to European agriculture. That may well be one of the ways out of the fraud problem which we are confronting today.
Cheating on export refunds can be achieved by a variety of methods. In a large bureaucracy many people get to know beforehand of a change in the rate or the timing of a subsidy, and traders can take advantage of that. Experts know to what extent documents, the destination of shipments and classification are inspected and controlled and how far these matters are subjected to proper audit: so they can take advantage of all that. There can be swindles in the nature of the product: diluted olive oil, grain which is mostly sand, and offal which is exported as prime quality beef. All are swindles that we know about and which are on the record.
The only cure is to have a proper audit procedure combined with simplification of the classification of products. Although the majority of fraud takes place within the context of the common agricultural policy it would be wrong to ignore what was said by the report to your Lordships' House by the Select Committee: that virtually no form of Community finance is untouched by fraud. That is a serious indictment, to which your Lordships must pay proper attention.
What should be done? What must be done? As many noble Lords have pointed out, there is a question of political will. The noble Lord, Lord Bethell, drew our attention to the role of the European Parliament; his was a very valuable contribution. However, as all noble Lords who have spoken recognise, ultimately it is a question for the Council of Ministers. The Council of Ministers must sit down and say collectively, "This is a problem which we seriously wish to tackle and"—as my noble friend Lord Bruce of Donington said—"wish to tackle now": not tomorrow, next year or the year after, but now.
Specifically, we need to reform the role of the Court of Auditors. The recommendations of the report which we debated last Thursday are quite clear. The Court of Auditors has functions under the Treaty of Rome and must be allowed the resources which will permit it to carry out those functions. It must have powers of inspection in member states and more staff. All Community operations in member states should be audited; in our case that means close co-operation between the Court of Auditors and the National Audit Office. There must also be power to ensure that the Community itself issues accounts which incorporate a true and fair view and not just notes that the accounts have been established according to the law.

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In turn, member states have to respond with their own programmes. The problem with the anti-fraud co-ordination unit, as the Commission has pointed out, is that its role is essentially limited. It can control, stimulate, co-ordinate and reinforce. These are all very nice words. But, with management power vested in the member states, the unit cannot possibly be strong enough. I should like the Minister to consider whether we should not return, as my noble friend Lord Bruce of Donington has said, to the proposal made in 1976 that all states incorporate in their law provisions that make it a crime to cause the unlawful reduction of Community revenue or the unlawful collection of public subsidies, refunds or financial aid.
There may be technical problems; if so I am sure the Minister will explain them. There may be difficulties in the status of such a directive coming out of the Community. I am sure however that my noble friend was right when he said that until we make this activity a crime, in exactly the same way as we have crimes of fraud in this country, we are not going to make much progress throughout the Community. As the noble Baroness, Lady Robson, pointed out, as we move into 1992 the opportunities for fraud, unless there is greater and more effective control, will be enlarged.
We recognise that the United Kingdom Government have in the past made an effort. The past Prime Minister launched an initiative and, as the noble Lord, Lord Campbell of Alloway, said, it appears to have failed. I should be grateful, if I may have the attention of the noble Lord, for an explanation of how and why that initiative failed. What happened? Why did it run into the ground and lose momentum?
There seem to me three things the Government have to do urgently. First, they should press, and continue to press, other member states for action in the Council of Ministers. That seems to be the consensus of noble Lords today. Secondly, the Government should publish a White Paper setting out a programme of action and should report regularly on that programme to your Lordships' House and to another place. Thirdly, they should recognise that the matter merits being placed on the agenda of the intergovernmental conference on European monetary union. As the noble Baroness, Lady Robson, rightly pointed out, in the event of a possible Swedish application to join the European Community, who wants to be a member of a Community or join in an economic and monetary union with an organisation that cannot get its accounts in order? That is why it should be discussed by the next IGC. If they do these three things I can assure the noble Lord that the Government will have the Opposition's full support.
4.37 p.m.
Lord Henley: My Lords, it is clear that this House has a keen and continuing interest in ensuring that the campaign to stem fraud against the EC budget does not flag. I should like to join other noble Lords in thanking the noble Lord, Lord Benson, for introducing this debate, following up the debate some 18 months ago on the report by the noble Baroness's Select Committee, which was published in February
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1989. The Government share the House's concern and are in the forefront of efforts to maintain the momentum of the Community's anti-fraud programme. I can assure my noble friend Lord Campbell of Alloway that we shall continue in that position.
I should like to bring the House up to date on recent progress with this programme and to indicate our priorities for the future. I would also stress that there has not been any inactivity, as was suggested by the noble Lord, Lord Bruce of Donington. Perhaps I may first say that the 13-point action plan in your Lordships' Select Committee's report of February 1989 on EC fraud has provided valuable assistance to the Government in deciding how best fraud might be tackled in the Community. That assistance has not been just to the Government. The European Commission's 45-point work programme, developed in early 1989 at United Kingdom prompting by an EC committee of experts on fraud (COCOLAF), broadly covers the same areas as the 13-point action plan in the report of the Select Committee. ECOFIN and the European Council endorsed this programme in June 1989 and welcomed the Commission's undertaking to follow it up with an annual progress report.
Work on the programme went ahead during 1989 under the co-ordination of a new Commission anti-fraud unit (UCLAF), reporting direct to M. Delors, and the Commission produced its first annual report on 7th February 1990. The Commission rightly began the report by stating the need for political determination to combat fraud in the Community. At the meeting of ECOFIN on 12th March this year we welcomed the Commission report and stressed the priority to be given to initiatives on the simplification of EC legislation, improved investigation and reporting by member states, and agreement by member states on appropriate administrative sanctions. This prioritisation reflects the fact that, as the Select Committee recognised, there are no quick fixes against fraud, and any programme will take a number of years to implement.
So, while recognising that much remains to be done, let me now turn to the main achievements under the Commission's programme in the past year and a half, and set them in the context of the 13 points set out in the Select Committee report of February last year.
The first point, which has been touched on by various noble Lords, was the need to simplify Community regulations. Her Majesty's Government are keen to do as much as possible for their part to make regulations which are easier to understand and operate. At Community level, an ad hoc committee known as the Lachaux group has been established to study the scope for simplifying the mechanisms of agricultural support. This will provide an opportunity to remedy the defects in current regulations which can work to fraudsters' advantage, as the noble and learned Lord, Lord Templeman, quite rightly said; though we shall clearly need to strike a balance between the goals of simplicity and the need to keep

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the system watertight. As the noble Baroness, Lady Robson of Kiddington, said, incautious removal of controls can create more opportunities for fraud.
The second, related point concerns reduction in the number of product classifications. The Commission is undertaking a review of differentiated refunds, with a view to reducing the complexity and so the opportunities for fraud. Action has so far been taken in the beef, fruit and vegetable sectors. While again we must guard against the danger that oversimplification of the system could lay it open to abuse and so prove more expensive, we remain convinced that some streamlining is both possible and desirable, and the United Kingdom has suggested a number of reforms to the Commission.
The Government support your Lordships' third point that lucid instructions are necessary at all levels. To this end we have supported Commission action to convert directives concerned with Customs controls into regulations as a means of introducing greater precision of meaning and conformity of application. We have also supported Commission efforts to introduce greater clarity into the regulations—for example, by the proposed Community Customs code—which will come into force with the single market on 1st January 1993. Measures have also been taken within the United Kingdom to assist in providing lucid instructions. Among other measures, Her Majesty's Customs and Excise will shortly reissue its CAP export instructions after a comprehensive review.
The fourth point in the report concerned the need to establish effective internal controls, as mentioned by the noble Lord, Lord Williams. Her Majesty's Customs and Excise has during the past three years introduced improved arrangements for examinations, reviews and inspections. In the area of CAP exports, our 7 per cent. national target examination rate for all CAP export consignments is now underpinned by an important new EC regulation which sets minimum examination rates for exports attracting export refunds for each Customs region. Customs is already achieving an examination rate by consignment of over 8 per cent.
The next point in the Select Committee's report concerned the need for better training of staff. Steps have recently been taken by Her Majesty's Customs to improve staff training, from which 600 officers have already benefited, designed in particular to equip staff with the basic knowledge and skills required for their control duties.
Improved exchange of information was the sixth recommendation. Since that recommendation was made there has been a considerable investment of effort in this area both by member states and by the Commission. There has been an encouraging increase in the flow of information over recent years, not least by means of more frequent ad hoc meetings between national officials. The Commission has been playing an effective role in bringing together investigators of the various national Customs services.
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Abolition of advance payment under the agriculture guarantee was the seventh point in the Select Committee report and it was mentioned by the noble Baroness, Lady Robson. As early as October 1987 a decision had been taken to abolish advances. I am glad to say that this has now been implemented, with the result that member states' expenditure is now funded two months in arrears.
The next point in the programme concerned the need for intensified efforts by member states to detect fraud. Among measures taken to achieve this in the United Kingdom, Her Majesty's Customs now has an additional 15 posts for CAP export control on top of the existing departmental total of 100 available in 1990–91. The noble Lord, Lord Bruce, laughs, but 15 out of 100 is an increase of 15 per cent.
Lord Bruce of Donington: My Lords, I am sure that the noble Lord would agree that it would be far more advantageous if the increase had been 100 per cent., which is what the position should be.
Lord Henley: My Lords, I am sorry that we cannot go so far as the noble Lord would like. I said that the increase was 15 per cent. and I do not believe that it merited the noble Lord's laughter, especially as it complements other efforts at a national level and the Commission's own inspection powers to detect irregularities of expenditure, about which I shall say more in a moment.
As to the vigorous pursuit of criminal prosecutions which both the noble Lords, Lord Bruce and Lord Williams, desired, and civil claims—the report's ninth recommendation—the Select Committee observed that the failure to conclude a Community crimes treaty was a cause of difficulty in instituting criminal prosecutions against fraudsters. However, since EC fraud was last debated in your Lordships' House a judgment made by the European Court of Justice would appear to have removed in part the need for such a treaty. The so-called Greek maize case reaffirmed the requirement on member states to treat fraud against the Community budget as seriously as fraud against their national budgets. M. Delors wrote to heads of government earlier this year asking them to ensure that proper regard was paid to the ECJ decision.
My right honourable friend the Prime Minister stated in reply—the UK was, as so often, the first to respond—that United Kingdom arrangements were in line with the ECJ ruling. So far, only four other member states have replied. Once all replies have been received, the Commission will consider in the light of the responses whether there is a continuing need for a Community crimes treaty.
The noble Earl, Lord Perth, touched on the recommendation to improve publicity and quite rightly mentioned that the media might offer a little more help. However, possibly the media have been concerned with other matters during the past week. In respect of the recommendation to improve publicity where fraud has been successfully dealt with, Her Majesty's Customs and Excise press office now works

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closely with the investigation division and frequently gains good coverage for successfully exposed and prosecuted cases of fraud.
The Government entirely agree with the importance of reporting fraud and irregularities to the Commission—the Select Committee's eleventh recommendation. Standards of reporting by member states have undoubtedly been variable. However, there have been recent signs that the obligation to report fraud and irregularities is being taken more seriously. Spain and Greece, for instance, have started reporting for the first time, and the overall number and value of irregularities reported have increased under a new regulation on traditional own resources and under a regulation on reporting of irregularities in agriculture currently under emendation.
In order to assist in this process of reporting, the Select Committee suggested that there should be a clarification of the definition of fraud and irregularity. This essential basic requirement was fulfilled in April 1989 when member states agreed and adopted a working definition in the form of an explanatory document which covers what is understood by an irregularity and in what circumstances it should be notified to the Commission.
Lord Campbell of Alloway: My Lords, will my noble friend allow me to intervene on this subject? How are we getting on with the matter raised by the noble Lord, Lord Williams of Elvel—the concept of Community fraud as a Community offence which is justiciable in the Court of Justice at the suit of the Court of Auditors? How is that going? Where are we getting to; or are we getting nowhere?
Lord Henley: My Lords, I thought I dealt with that earlier when I talked about the Greek maize case, which reaffirmed the requirement on member states to treat fraud against the Community budget as seriously as fraud against their national budgets. In the light of responses from member governments, a community crimes treaty may still be needed, but we felt that the case I referred to removed the greatest need for such a treaty. I hope that that goes some way towards helping the noble Lord.
The final recommendation in the report was for closer Commission surveillance within member states. The Government consider that the Commission has a major role to play in co-ordinating the anti-fraud activities of member states. Existing provisions give the Commission important rights of access and oversight in the agriculture and own resources areas to ensure even-handed administration by member states in the wider Community interests. Proposals are under discussion in Brussels to amend the CAP irregularity regulation and to enhance the power of the Commission to be associated with national investigations. The United Kingdom is supporting such Commission involvement, even with criminal investigations, provided that national law so allows and provided that sensitive areas such as search of premises and questioning of suspects are excluded. In fact a United Kingdom amendment to this effect has been accepted and we very much hope that speedy agreement can now be reached.
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I shall now turn to the four questions that the noble Lord, Lord Benson, put to me in his opening speech. He first asked when an action programme would be prepared for annual review by the Court of Auditors. The Commission's 45-point plan, developed in 1989 and endorsed by the Council in 1989, was reported to the House of Commons by my honourable friend the Paymaster General earlier this year. The Commons took note of and approved the Government's efforts. The Commission makes public an annual report on the fight against fraud. I shall return to that matter in a moment.
I was also questioned about the role of the Court of Auditors. That body already produces an annual report which comments on fraud, as appropriate. The 1988 report was debated in the Commons in February 1990. The European Court of Auditors also produces special reports on topics of interest such as export refunds. Therefore the court takes a leading role in highlighting fraud and other irregularities by use of its existing powers. However, I appreciate that the noble Lord, Lord Bruce, felt that it might be possible for the court to report somewhat earlier than is now the case. At the moment the timetable is established in Community legislation. The Commission's right to reply to the Court of Auditor's annual report is enshrined in Article 206 of the treaty.
Under Article 88 of the financial regulation, the court must transmit the annual report by 15th July. The Commission must then respond by 31st October and the report must be submitted in its final form by 30th November, that is 11 months after the financial year in question. Her Majesty's Government believe that the replies of the institutions are valuable to ECOFIN when it considers the ECA's report.
There is no doubt that the structure and powers of the court will figure in the intergovernmental conference on political union. The noble Lord, Lord Williams, asked me about that point. The United Kingdom will propose enhanced powers to improve the effective scrutiny of the EC budget by increasing the effectiveness of the Court of Auditors, clarifying responsibilities as to financial control and enhancing the European Parliament's role in scrutinising the budget. These measures should make an effective contribution to the fight against fraud. I welcomed the contribution made by my noble friend Lord Bethell on this matter. The Government welcome the active role taken by the European Parliament. As the joint arm of budgetary authority, the European Parliament has a direct interest. Its involvement helps to maintain the political impetus.
The noble Lord, Lord Benson, also asked when the Council of Ministers would accept responsibility for this matter. It already does so. Written progress to date on the 45-point plan is reviewed annually by ECOFIN. The noble Lord also asked about responsibility within the Government. That is clearly defined. Her Majesty's Treasury is responsible for the EC budget and for co-ordinating anti-fraud policy. Customs and Excise and the Ministry of Agriculture, Fisheries and Food are in league on enforcement.

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I have endeavoured to show noble Lords that the Select Committee's work has provided a solid and influential start to a practical and continuing drive to deal more effectively with the virus of fraud within the Community. This is a battle which may never be conclusively won, but by examining every area of possible abuse and by taking practical and effective measures, such as those I have described today, to counteract and close off opportunities for fraud and by the constant exercise of vigilance we can make and keep it a hard and unprofitable option to be dishonest or inefficient at the expense of the Community taxpayer. Her Majesty's Government are determined that what has been achieved should be only the start. We shall not flag in our determination to bring the same high standards to Community finances as we exercise domestically.
4.55 p.m.
Lord Benson: My Lords, I am grateful to the Members of the House who have spoken in this debate. I think it is fair to say that there is general agreement that there is a public scandal which has not yet been eradicated. There is also agreement that there is an absence of political will to correct it. I am grateful to the Minister for seeking to answer the various points that have been raised and the four questions that I put to him.
As regards my first question, it is quite plain from the answers given that no comprehensive report comprising responses from the Council of Ministers, the Commission and the member states has yet been prepared. Until that is done this public scandal will continue. It is very unsatisfactory in a debate of this kind to have to drag out, so to speak—I use that phrase politely as I am sure it is no part of the Minister's duty not to help us—bit by bit what is happening. It is rather like the situation of Churchill's porcupine, which had to be plucked quill by quill.
I draw the attention of the Minister to the proposals that have been made by the noble Lord, Lord Williams of Elvel, and the noble Earl, Lord Perth, for a White Paper to be prepared to show the Government's intentions. They further propose that an annual report should be made to both Houses to show exactly what is taking place. Until that is done the problem will continue unabated.
Secondly, I asked what was happening about the reform of the Court of Auditors. Alas, all we have had is a series of promises of goodies yet to come. I suppose it is impossible for the Government to promise more than that as nothing more has yet been done. What those goodies will be remains to be seen.
Thirdly, I asked when the Council of Ministers would accept its responsibilities to deal properly with the criticisms made by the Court of Auditors. I understood the Minister to say that the Council of Ministers has accepted those responsibilities. However, I deny that that is the case unless it has happened in the past few days. It has certainly never happened up to this point. The Council of Ministers has never properly replied to the criticisms made by
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the Court of Auditors. I hope the Minister will re-examine that point and make proper inquiries on it as the answer given to the House was not satisfactory.
On my fourth point, I am obliged to the Minister for his remarks. I need not detain the House any longer. I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

The Middle East
5 p.m.
The Minister of State, Foreign and Commonwealth Office (The Earl of Caithness): My Lords, with the leave of the House, I shall now repeat a Statement being made in another place by my right honourable friend the Secretary of State for Foreign and Commonwealth Affairs. The Statement is as follows:
"With permission Mr. Speaker, I should like to make a Statement on developments in the Middle East since my Statement on 24th October.
"The international coalition is holding firm. Our objectives remain: the full and unconditional withdrawal of Iraqi forces from Kuwait; the restoration of the legitimate Government of Kuwait; and the release of all hostages. President Saddam Hussein continues to show little sign that he intends to comply with the will of the international community and withdraw. He continues to rebuff the United Nations, to strengthen his military position in Kuwait, to destroy Kuwait's fabric and national identity, and to manipulate the fate of British and other citizens trapped in Iraq and Kuwait.
"Only by intensifying all the pressures at our disposal—diplomatic, economic and military—can we persuade Saddam Hussein that he has no alternative to withdrawal. Sanctions are being applied rigorously. We hope that the existing pressures will be sufficient to persuade Saddam Hussein to withdraw. If they are not sufficient we need to convince Saddam that the military option is a serious one. The option for peace is in his hands. No one does any service by blurring the choice before him.
"For that military option to be fully credible, the international community must show that it has the political will to exercise it. The Security Council is expected to meet at ministerial level within the next few days and vote on a resolution authorising "all necessary means"—that is to say, including force—to be used to ensure Iraqi compliance with Security Council Resolution 660 and later resolutions. The resolution will include a date—probably in the first half of January—by which time Iraq is required to comply in full with these resolutions. It does not follow from this that military action will follow immediately thereafter—nor indeed that military action will necessarily take place at all. Rather, the purpose of the grace period is to allow Saddam Hussein an opportunity in which he can safely withdraw from Kuwait and

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release the hostages. If he does not do so, he must face the possibility of military action and certain defeat.
"We remain anxious for the well-being of the many hundreds of British hostages who remain in Iraq and Kuwait. Some have been released through the intervention of political figures and relatives. We understand the suffering of the families and the humanitarian motives of those who go to Iraq. But Saddam Hussein exploits these visits for his own unacceptable ends. The international community is united in resisting that blackmail.
"With tension increasing in the region we are keeping under constant review our advice to British communities in other parts of the Gulf. We advise those living in the eastern region of Saudi Arabia, Qatar and Bahrain with children in Britain not to bring them to the area, but to spend the Christmas holiday here, and for dependants to remain outside the Gulf until the situation becomes clearer. This does not mean that we foresee hostilities around that time: but it is sensible to minimise the number of dependants when we are entering such a critical phase.
"I am able to report some positive political steps. On 27th September we announced the resumption of relations with Iran. Today I can tell the House that we are resuming relations with Syria with immediate effect. The respective heads of the Interests Sections in London and Damascus will be chargés d'affaires pending the exchange, as soon as practicable, of ambassadors. We have received from the Syrian Government assurances that Syria will continue its strenuous efforts to obtain the release of Western, including British, hostages in Lebanon and confirmation that Syria rejects acts of international terrorism and will take action against the perpetrators of such acts which are supported by convincing evidence, and a confidential account of the Syrian position on the Hindawi affair. I am glad that it has proved possible to overcome the differences between the UK and Syria."
My Lords, that concludes the Statement.
5.4 p.m.
Lord Cledwyn of Penrhos: My Lords, we are grateful to the noble Lord for repeating the Statement. As the House knows, we have broadly supported the Government's handling of the crisis throughout. We appreciate this further clarification of policy. We note with great interest that a new resolution is to be considered shortly in the Security Council with a view to ensuring Iraqi compliance with Resolution 660 and the other resolutions. We also note the important new element in it; namely, that a date by which Iraq is required to comply with the resolutions will be set. We further observe that it is still hoped that existing pressures will suffice to persuade Saddam Hussein to withdraw, and that military action need not necessarily take place on the appointed date. Can the Minister say whether any further diplomatic action is proposed in order to underline the determination of the United Nations to secure the withdrawal? We
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know that Mr. Perez de Cuellar has visited Baghdad on one occasion. Is there any arrangement for him to visit Iraq again?
We note that the Statement says,
"sanctions are being applied rigorously".
Can the noble Lord say whether they are working, and working in such a way as to bring the maximum pressure upon Saddam Hussein? Are the Government satisfied that the reality of a military operation and the consequences of military action are fully appreciated by Saddam Hussein and his regime?
We agree entirely with the Statement in its reference to hostages and the disgraceful way in which they are being manipulated. We further note and support the advice to British communities in the area, and also the steps taken to resume diplomatic relations with Iran and Syria. We welcome the Syrian assurances about hostages elsewhere.
Finally, is the Minister able to tell us whether the representative of the Soviet Union who has been travelling back and forth between Moscow and Baghdad has also conveyed to Saddam Hussein the implications of his continuing obduracy with all the consequences of that obstinacy?
Once more, we support the United Nations initiative and the Government's approach to this grave problem.
Lord Tordoff: My Lords, from these Benches also we thank the Minister for repeating the Statement. It is a very serious Statement. Can the Minister be more specific about the date to be included in the proposed United Nations resolution than "probably in the first half of January"? I take it that negotiations are still taking place between the members of the Security Council, but a more specific date would be helpful. Once such a resolution has been passed we could find ourselves engaging in military activity very quickly afterwards. Can the Minister say what further steps will be taken to involve Parliament before such action was taken, and indeed to involve the United States Congress?
I draw the attention of the House to the comment made by my noble friend Lord Mayhew in the debate on the Address to the gracious Speech that:
"there may also come a time when we have to remind ourselves that sanctions are a merciful alternative to war".—[Official Report, 13/11/90; col. 310.]
It is in that spirit that I hope that the timing and the usefulness of sanctions will be viewed. In other words, sanctions must be pursued for so long as possible. Nevertheless, one understands the need to make it quite clear to the Iraqi dictator that we are serious about a military option at the end of the day when all other avenues have been fully explored.
The resumption of relations with Syria will bring considerable relief in many quarters. However, I am quite sure that it will be criticised because Syria has been accused of supporting terrorism and that there will be some dubiety as to whether Syria has pulled back fully from that position. Nevertheless, one welcomes the assurances contained in the Statement

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that Syria now rejects acts of international terrorism and will take action against the perpetrators of such action. I am very pleased that that is happening.
As one of the four Members of the United Kingdom Parliament who went to Teheran four years ago to attempt, among other things, to seek the release of hostages held in Lebanon, I am now convinced that if Syria will use its good offices and Iran continues to use its good offices there is a reasonable chance that our hostages may be released in good time. If this is a step in that direction everyone will be pleased. To renew diplomatic relations is a positive step. I take it that the restoration of diplomatic relations signifies a return to the traditional British practice of regarding diplomatic relations not as a matter of approval or disapproval of a particular regime but as a matter of fact.
With those qualifications and comments I welcome the Statement.
The Earl of Caithness: My Lords, I am grateful to the noble Lord, Lord Cledwyn, the Leader of the Opposition, and the noble Lord, Lord Tordoff, for the welcome that they have given to the Statement. The noble Lord, Lord Tordoff, said that it was a serious Statement. Indeed it is. We are in serious times. I am grateful for the support that the Opposition have given to the Government on this matter. As I said at an earlier date, we shall keep Parliament informed, as we are doing today.
The noble Lord, Lord Cledwyn, asked about further diplomatic action. Yes, we shall take whatever action we can to bring reality to Saddam Hussein. But sometimes it is quite difficult if he does not want to receive the information.
With regard to sanctions and whether they are working, we believe that they are beginning to bite in Iraq. All the oil outlets are effectively blockaded. The neighbouring countries of Syria, Iran, Saudi Arabia and Jordan have announced that they are implementing sanctions. But on the evidence available it is hard to argue the sanctions alone will reverse Iraqi policy.
I agree with the noble Lord, Lord Cledwyn, about the appalling way in which members of the British community and others are being treated as hostages. I am grateful to both noble Lords for their welcome to the opening up of diplomatic relations with Syria. The noble Lord, Lord Tordoff, asked whether I could be more specific about the date. No, I cannot. That is still, as he so rightly said, a matter for discussion. On the question of terrorism from Syria, we believe that the assurances given on Syria's future conduct are indeed satisfactory.
5.11 p.m.
Lord Boyd-Carpenter: My Lords, will my noble friend clarify one matter? In view of the fact that it appears that Saddam Hussein has removed from Kuwait much of that country's wealth and many of its assets, would it be regarded as compliance with the United Nations resolution if he simply withdrew but did not restore the stolen property?
The Earl of Caithness: My Lords, my noble friend takes the debate further than the withdrawal of Saddam Hussein from Kuwait. The first and most important matter is that complete and utter withdrawal. As regards the other matters, I should like to think about them a little further.
Lord Monson: My Lords, while obviously the restoration of diplomatic relations with Syria is to be welcomed in principle, can the noble Earl confirm that Her Majesty's Government are totally satisfied that the Syrian authorities bear no responsibility whatever, either direct or indirect, for the Lockerbie disaster?
The Earl of Caithness: My Lords, police investigations are continuing with regard to Lockerbie. I know that the noble Lord will understand that I am limited in what I can say. But let me reassure him and the House that the Syrians have said that they will take action against the perpetrators of any acts of terrorism where there is convincing evidence.
Lord Hatch of Lusby: My Lords, every Member of this House and of another place agrees that the withdrawal of Saddam Hussein from Kuwait is an essential element in reinforcing the authority of the United Nations. Indeed some argue that the authority of the United Nations should have been reinforced earlier over many other aspects. The object of the United Nations is to solve international problems by peaceful means, is it not? In that case, as mentioned by the noble Lord, Lord Tordoff, when he quoted the noble Lord, Lord Mayhew, the use of sanctions is the alternative to the use of military force, which would be disastrous not just for Saddam Hussein but for the whole of the Middle East and probably for the whole world.
Lord Tordoff: My Lords, I am grateful that the noble Lord has given way. I did not say that sanctions were the alternative. I said that sanctions and other means should be used to the ultimate before force is used. I was not suggesting—and I am sure that my noble friend Lord Mayhew was not suggesting—that sanctions were the alternative force.
Lord Hatch of Lusby: My Lords, I accept that correction. It was a misunderstanding. I intended to convey exactly the same meaning as the noble Lord, Lord Mayhew. However, if that is the case, does the noble Earl agree, on behalf of the Government, with the wise words spoken recently by the most reverend Primate the Archbishop of Canterbury to the effect that sanctions should be given a period of around 12 months to prove themselves before military action is taken?
The Earl of Caithness: My Lords, I repeat that on the evidence available it is hard to argue that sanctions alone will reverse Iraqi policy. We need every means at our disposal to make Saddam Hussein realise that he has the opportunity to maintain peace by withdrawing all his troops fully and completely from his invasion of a fellow member of the United Nations. It was he who perpetrated that act. It is up to him now to withdraw.
Lord Kennet: My Lords, does the noble Earl remember in the memoirs of his noble friend Lord Carrington an interesting passage about sanctions in

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Rhodesia? The noble Lord describes how he went there two years after the beginning of UN sanctions against Rhodesia and found that only then were they beginning to bite. He was surprised that anyone should have been so foolish as to think that they could bite earlier.
The Earl of Caithness: My Lords, I recall those words well. I hope that the noble Lord's noble friend listened to those words.

The Commonwealth
5.16 p.m.
Lord Greenhill of Harrow Lord Greenhill of Harrow rose to call attention to the future of the Commonwealth; and to move for Papers.
The noble Lord said: My Lords, I beg to move the Motion standing in my name on the Order Paper. In the light of the great changes in the international scene, I believe that it is an appropriate time to test the opinion of the House on the future of the Commonwealth. Interest in this matter is rising. Indeed, the noble Lord, Lord Alport, raised the issue in the debate on the Address on 13th November. I had hoped that in this debate this afternoon he would enlarge on his remarks, but I am sorry to say that he is unwell and will not be speaking.
Although it might be more useful to seek the views of a younger group of persons than this House, there are Members who are particularly well qualified to speak. I want to look at the questions from a purely British point of view. I am no expert on the Commonwealth but at one time or another I have visited and travelled in the larger members of the Commonwealth.
In this country opinion on the Commonwealth, without doubt, has become increasingly divided. I daresay that to a greater or less extent that division is shared by several other member countries. In this country interest has certainly declined. I am told that in Canada it has somewhat increased in the wake of the development of closer US-Canadian trade relations. But everywhere the generations and leaders who witnessed the birth of the Commonwealth have passed from the stage.
Shortly before the recent Commonwealth conference in Kuala Lumpur last year, a headline in one of the leading British papers read: "The Commonwealth: a network of friends or a forum of phoneys". It was the realisation that there is such confusion that led the heads of government at the conference in Kuala Lumpur to set up a working party to prepare a report for their meeting next year in Harari. Just as the European Community invented Eurospeak, the Commonwealth is using a special Commonwealthspeak.
The working party is called a high level appraisals group, just as the earlier unsuccessful mission to South Africa went under the name of the Eminent Persons Group. I mention that because I find much of the writing on the Commonwealth uses an obscure and woolly language of its own. The high level group is
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meeting again next week in Malaysia, and the noble Lord, Lord Armstrong of Ilminster, is appropriately the United Kingdom representative. He apologises for his absence this afternoon and greatly regrets that he cannot speak today, and so do we. He has asked for Hansard to be sent to him in Malaysia soon after the debate.
How the Commonwealth has evolved is familiar to your Lordships. It arose with the natural coming together before the war of the independent English-speaking dominions, including South Africa. Throughout World War II members of the Commonwealth formed an essential and a notably gallant element in the allied forces and were among the first to respond in Korea and in the present Gulf crisis.
Immediately post-war, the Commonwealth group struck out on a new and unprecedented course with the inclusion of republican Pakistan and India. Their inclusion was a necessary factor in the peaceful settlement of their independence. It seemed a natural and proper thing to do, especially to those who had served in the Middle East and in South-East Asia alongside forces from the Indian subcontinent. The happy device of Her Majesty the Queen as Head of the Commonwealth made it all the more acceptable to British opinion.
It can be argued that it might have been better if expansion had stopped there, and, if so, the United Kingdom might have commercially and industrially been brought face to face with the reality of its post-war situation and therefore competed more strenuously for a change in our pattern of trade. No one anticipated the rapid run-down of the Empire, nor the continued call for the expansion of the membership to over 50 now, which, without too much thought, changed the whole position of the United Kingdom. More than a quarter of the world's population is now included, stretching right across the globe, and the proportion is increasing. No one should underestimate the mutual value of such a network of friends, if, indeed, they are true friends.
We must ask ourselves whether it makes sense to belong to, and to develop, such a grouping at a time when we are assured that our true friends are not necessarily the English-speaking world but those nations of Europe with whom we have been in conflict for far too long. Does our first loyalty lie with them or with our Commonwealth partners? Do we need to make a choice at all? There can be little doubt that the future organisation of Europe must inevitably be of more importance materially to us than the Commonwealth can ever be, but that does not mean that the Commonwealth must be neglected or abandoned.
The aim of the European Community is to match, politically and economically, the power of the United States and Japan. Our cultural and family links with many of the Commonwealth countries are strong and those links will remain and be made firmer by facilities for world travel. Can we not have it both ways? I believe that we can, and that it is in our interest to do so.
I should guess that the great majority of young people in this country will have little difficulty in reconciling worldwide friendship across the Commonwealth with whatever form of European union emerges from the coming negotiations. But the Commonwealth cannot go on just as it has in the past. We have been made well aware of its imperfections. In international affairs our partners have done much to try to embarrass us; for example, in the days of decolonisation debates at the United Nations and over our policy of confrontation East/West. Some of them have waged vicious war among themselves, and many members have conducted their affairs with systems of government far divorced from democracy and with features repugnant to us.
The world is changing dramatically, and if the Commonwealth is to survive it must make fundamental changes for the future. Despite events, it has not withered away and indeed has held together and attracted new members. The fact that it is doing so owes a great deal to the dedication and beneficial, and frequently decisive, role played by Her Majesty the Queen and members of the Royal Family. The respect and affection in which our monarchy is held is one of the strongest bonds which unites it. Her Majesty's reception at the Commonwealth Games in New Zealand last year was convincing evidence of that.
We have now reached a critical point in our relations with Europe and the promise of greater understanding between the power blocs. Can the Commonwealth play any practical role over a wider field than the European Community? The Community may eventually share the advantages of a common currency, but the Commonwealth now enjoys the advantages of a common language, a shared culture and a long history of many friendly and intimate contacts at all levels.
It is that question we should now address. My conclusion is that it is worth taking more than a casual interest and a limited investment only in that unique group which includes countries of growing wealth and potential political importance. We should remember that within a generation the population of Pakistan and Nigeria together will far exceed an expanded European Community. We should usefully proceed without delay along the following lines: first, there is a requirement from the British point of view for the Government to make clear their unequivocal support for the Commonwealth, if necessary, by a statement on an appropriate occasion. Any such statement has been lacking in recent times.
In summing up during the foreign affairs debate on 13th November, the noble Earl, Lord Arran, said that we were "committed" to the Commonwealth. The word "committed" is used when one is sent to prison. Something more enthusiastic is required. Such a statement might commend itself to the new Prime Minister, who in the past has worked in some Commonwealth territories. Secondly, the Foreign and Commonwealth Office is the lead department in Whitehall for Commonwealth affairs, but all departments of state, especially trade and industry
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and environment, must also be involved. I understand that in the recent past the Minister in the Foreign and Commonwealth Office who concerns himself with those matters tries to combine them with the Middle East—a rather one-sided portfolio. What is required is someone who regularly visits the member territories and shows our interest and learns theirs. Mrs. Lynda Chalker of the ODA has done splendid work in that respect, but there is room for another Minister who is not concerned primarily with aid and has a wider brief.
Thirdly, the number and purpose of Commonwealth meetings should be reconsidered. As well as the formal meetings between heads of government every two years, there should be meetings at lower levels on practical problems of mutual trade, poverty, indebtedness, human rights, environment, medical and scientific problems and democratic organisation. Some such meetings take place, but are they followed up?
The area in which the most useful initiatives can be taken is education, in its widest sense, both by governments and non-governmental organisations. There are many Members of the House who know about that, and in the academic world there are people such as the noble Lord, Lord Briggs, and Professor Dilkes of Leeds University who have skills and ideas ready to be applied. Some will cost money but expenditure will be an investment with a high return. The aim would be to create as many mutually profitable links as possible in the widest variety of subjects.
Lastly I turn now to the Commonwealth Secretariat here in London. It has never quite fulfilled expectations and has sometimes ventured too far into British politics. Now we have the good fortune to welcome a new secretary general. He is Chief Anyaoku of Nigeria, a man of talent and experience who deserves our full support. He will have his own ideas on how to discharge his responsibilities. He is particularly suited to exercise a healing touch on many problems within the Commonwealth. Indeed, he has already taken an interest in South Africa, which may well become a subject that unites the Commonwealth where once it divided it. The secretary general is supported by his secretariat. It does good work but perhaps it is too much inclined to hide its light under a bushel. The British Government give it considerable financial support and should continue to do so.
The sum allocated by the ODA to technical assistance runs into tens of millions per annum and compares favourably with the new know-how fund for Eastern Europe, with which I am afraid in due course it must compete. The secretariat can, I am told, find great scope for expanding its co-operation with the non-governmental organisations, and this should be encouraged.
Finally, no doubt the Government will want to wait for the report of the high level appraisal group. The discussion of its recommendations next year at Harare will be important. We must remember that this country is only one voice among many of our partners.
In summary, I believe this country has a historic responsibility to energise Commonwealth co-operation at this time. I hope that many of your Lordships share this view and can suggest constructive ways in which it can be achieved. My Lords, I beg to move for Papers.
5.32 p.m.
Lord Boyd-Carpenter: My Lords, the noble Lord, Lord Greenhill of Harrow, has done a considerable service to the House and to the Commonwealth by raising this subject this afternoon. This House frequently discusses Europe, but it is a lamentably long time since it has discussed the Commonwealth. Therefore, it is good to make a contribution towards restoring the balance. I hope that the noble Lord, Lord Greenhill, will not take it amiss when I say that a two-and-a-half-hour debate is a wholly inadequate period for discussing this immensely important and complicated subject. I hope that the Government Whips will decide that before too long we shall have a whole day in which to discuss the Commonwealth. The subject is so important that it is better to spend a day discussing the affairs of the Commonwealth than, for example, having a blank Monday from time to time. I hope that the Whips' Office will bear that in mind.
There is little that one can say on this immense subject in so limited a time. The British Commonwealth is one of the most remarkable organisations that the world has seen. It contains an extraordinary mixture. There are wealthy, modern countries such as Canada, Australia and the United Kingdom. There are huge Asian countries such as India and Pakistan. There are large and small African countries and tiny outposts such as the Seychelles, the Falkland Islands or Gibraltar. All are united by certain common ideas and by the English language. The Commonwealth is a remarkable example of international co-operation between countries at totally different levels of economic wealth, civilised advance, living standards, and so forth. Surely it must make an enormously valuable contribution towards the working of the world.
However, it is not only that. The noble Lord, Lord Greenhill, mentioned the fact that when this country has been involved in war the Commonwealth has come to our assistance. Without wishing to make too invidious a comparison, I believe that the Commonwealth's contribution to our victory in 1945 was infinitely greater than that of the present members of the European Community. Some of them were on the other side and most of the rest were defeated. Therefore, there is not merely a sentimental and emotional feeling towards the Commonwealth—although that exists—but there is also a practical feeling that our being at the centre of it adds considerably to our physical power and influence in the world. It would be the greatest pity if the Commonwealth were allowed to decline or to decay. I agree with the noble Lord, Lord Greenhill, that it must evolve and change. However, it is most encouraging that, for example, Pakistan believes it worthwhile to return to the Commonwealth. I hope
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that similarly Fiji will return before too long. Both are extremely interesting countries with considerable influence in their parts of the world.
The noble Lord, Lord Greenhill, mentioned (and I wish to emphasise this fact) that the strength of the Commonwealth and its survival derives from the personal efforts of the Head of the Commonwealth, Her Majesty the Queen. Her Majesty has spent a great deal of time and effort in attending Commonwealth Prime Ministers' conferences in all kinds of inconvenient parts of the world. It is probable that she knows personally more of the leaders of Commonwealth countries than do any of those leaders. She has paid great attention to her role as head of the Commonwealth, and as such has made a major contribution to the history of the world. It is fitting that your Lordships' House should recognise that and seek to express its real gratitude.
I hope that the Commonwealth will continue. However, I strongly agree with the noble Lord, Lord Greenhill, that the Government should state publicly that they attach the greatest importance to the Commonwealth. The fact that they are involved with the EC does not in any way detract from their concern with the Commonwealth, their desire to co-operate with it and to see it prosper, grow and strengthen. For one reason or another, there has been a lack of government statements on the subject. I am sure that my noble friend Lord Caithness will make appropriate comments this afternoon. However, it calls for the new head of the British Government to state firmly that the Commonwealth is important to us and that the British Government will do their utmost to secure that it continues, develops and prospers. Furthermore, that we shall try to bring together that variety of countries, co-operating with a good civilisation, high standards, increasing contacts with each other and shall ensure that during the next century the British Commonwealth contributes something of what it contributed during the past century.
5.40 p.m.
Lord Bottomley: My Lords, I join with the noble Lord, Lord Boyd-Carpenter, in paying tribute to the noble Lord, Lord Greenhill. My first government appointment was as Parliamentary Under-Secretary of State for the Dominions. Before entering Parliament in 1945 I had gained vast experience in local government. When I could speak freely to the Prime Minister, Mr. Attlee, I said that with all my local government experience I could not understand why he had not sent me to a local government department. He said that the explanation was simple. It was time that I got away from drains and dustbins, and he wanted a young Minister to specialise in the Commonwealth.
Soon after I was appointed, I joined the United Kingdom delegation to the United Nations. My job was to sit on the committee dealing with the colonies and to keep in touch with other Commonwealth delegates. On the committee I sat next to Field Marshal Smuts and the Foreign Minister of the Soviet Union, Mr. Gromyko. My private secretary was John

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Hunt, now the noble Lord, Lord Hunt, who I am pleased to see is here this evening. He was the ex-secretary of the Cabinet.
At the end of the United Nations meeting, Field Marshal Smuts said that he was very pleased that a young Labour Minister was so interested in southern Africa. However, he said that I could not understand a problem unless I was face to face with it at first hand. He said that he would ask the Prime Minister to send me to South Africa to see things at first hand. In due course, Prime Minister Attlee told me that Field Marshal Smuts was sending me an invitation and I could accept and go to South Africa. John Hunt (as he then was) accompanied me and we spent some weeks in South Africa. Not only did we visit the Union, but also the protectorates and Southern Rhodesia. That visit served me well in facing up to Commonwealth problems, especially in handling the rebellion in Southern Rhodesia.
I have taken an active part in the work of the Commonwealth Parliamentary Association, having been chairman of the UK branch and treasurer of the whole organisation. The CPA brings together members of parliament from all countries in the Commonwealth. There is an annual meeting when about 300 members of parliament assemble to discuss current affairs and items affecting the Commonwealth.
The United Kingdom branch also organises a seminar each year when about 30 members of Parliament come together to talk politics generally and particularly as regards their own countries. Many who attended in the past are now distinguished prime ministers and ex-presidents. The President of Kenya is still in office. The Prime Minister of St. Lucia is still in office. All told there have been over 30 speakers attending the seminar.
The United Kingdom branch also organises an annual parliamentary visit. The members of parliament, who come from all over the Commonwealth, go to different parts of the country. They meet together here, visit one of the Channel Islands or the Isle of Man and usually visit a local authority in this country. The seminars have established personal contacts throughout the Commonwealth.
When I was Secretary of State for Commonwealth Relations, I took an active part in creating the Commonwealth Secretariat. A Canadian civil servant, Arnold Smith, was appointed and he was followed by Shridath Ramphal whom I knew as foreign minister for Guyana. He has just retired having given 15 years excellent service to the Commonwealth. He has been followed by Chief Emeka Anyaoku who received his education not only in this country, but also in France and in his own country. At the secretariat he was a director of international affairs. I am sure that we wish him many years of happiness, good health and success.
The Commonwealth Secretariat is responsible for organising the biennial heads of government meeting.
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Those are held in different Commonwealth countries. Summit meetings are private and are known for their frankness and lack of formality.
Over the 40 years of its existence at all levels of economic development and embracing peoples of many different races, religions, and cultures, the Commonwealth has been able to bridge racial, ideological and economic divides and inequalities assisted by a common language and heritage.
In 1971 Commonwealth governments set up the Fund for Technical Co-operation. That fund has low overheads and can provide experts at less cost than other agencies. The fund provides expertise and training in all areas of economic and social advance. Science and technology today are the basis for an improved quality of life.
The Commonwealth Science Council has been established. Its main emphasis is on the application of science. Commonwealth scientists work together in such areas as biological resources, agriculture, energy, mineral and water resources and environmental planning. The majority of Commonwealth countries are in their first generation of independence. The Commonwealth began when the independence of the dominions of Australia, Canada, New Zealand and South Africa were given legal expression in the Statute of Westminster 1931. It is the only international group outside the United Nations to form a cross-section of world community by bringing together developed and developing countries across the globe. Over one quarter of the world's population—1 billion people—live in the 50 countries which make up the Commonwealth. It is an example to the wider international community that there can be co-operation and understanding across the major divides of the world.
5.48 p.m.
Lord Shaughnessy: My Lords, the last general debate on the Commonwealth in your Lordships' House was held more than 11 years ago in March 1979. That is an inordinately long interval, as the noble Lord, Lord Boyd-Carpenter, said; and I should like to join in expressing gratitude to my noble friend Lord Greenhill of Harrow for giving us the opportunity to discuss what has transpired in Commonwealth affairs during that long interval.
In introducing the debate, my noble friend, with his long experience of these matters, gave a characteristically trenchant summary of where the Commonwealth now stands in world affairs. At the time of the 1979 debate, membership of the Commonwealth was 40 countries and has now increased to 50. That indicates that as an association of independent nations, the Commonwealth continues to be seen as a potent factor in the resolution of world problems.
It is also significant that its membership includes no superpowers and consequently provides a forum for smaller nations to express their aims and aspirations free from the overshadowing presence of world-power diplomacy. Furthermore, the geographical diversity of the Commonwealth, spanning as it does some seven

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continents and sub-continents and almost all the seas and oceans, brings together nations of a vast variety of races, colours and religions.
Regarding the possible directions in which the Commonwealth might go to make future contributions to the developments in this expanding technological world, I should like to refer briefly to two specific institutions within the Commonwealth. They are making valuable contributions to the dissemination of learning; the pursuit of democratic government and the advancement of global un-derstanding in this technological world.
At their meeting in Vancouver B.C. in 1987, the Commonwealth heads of government agreed to the creation of the Commonwealth of Learning. This was to be an agency to create and widen access to education and to improve its quality by using distant education techniques and associated communication technologies to meet the specific requirements of member countries. This proposal grew out of the anxiety felt by governments at the introduction of economic fees at metropolitan centres of education to which students from developing countries had traditionally gone for higher education.
The agency became operational in 1989 with its headquarters in Vancouver, and with the noble Lord, Lord Briggs of Lewes, —who headed the committee to study the problem—as its founding chairman, as was mentioned by the noble Lord, Lord Greenhill. Dr. James Moraj is the founding president. Funds to carry forward the enterprise have been pledged by a number of Commonwealth member countries, including generous contributions from the Province of British Columbia. A modest staff is in place in Vancouver, and in a number of participating countries. I hope that this imaginative initiative will prosper, since it provides an excellent example of the role the Commonwealth can play in the promotion of education on an international level.
The second institution I should also like to applaud is what might be termed our own trade association; namely, the Commonwealth Parliamentary Association to which the noble Lord, Lord Bottomley, referred earlier. The CPA has been around for a long time. It has played a pre-eminent role in strengthening parliamentary democracy and democratic institutions, and in cementing friendship and understanding among members of elected Commonwealth parliaments, not only at the national level but reaching down to state and provincial legislatures within member countries. By means of its regional conferences the CPA facilitates a dialogue between members of the legislatures of smaller countries and dependencies. It also has the existing machinery to fulfil additional responsibilities; in particular, the strengthening of democratic institutions by the provision of observer missions to supervise and report upon the electoral process. That is a function which I hope the CPA will be increasingly called upon to perform where the appropriate need arises.
Finally, I should like to suggest some other endeavours with which the Commonwealth could be usefully and legitimately concerned, and which I
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believe it is well equipped to perform. I mentioned the Commonwealth of Learning. However, there are other social world problems which must be addressed if we are not to destroy this planet with our own rapacity. Time does not permit me to elaborate. But I believe the nations of the Commonwealth could usefully act together in attacking the international drug trade which continues to erode the social fabric of so many countries. There is also the serious ecological problem of preserving the world rain forests, many of which are located in Commonwealth countries. Lastly, there is the spread of the scourge of AIDS which is reaching epidemic proportions in many countries of the developing world.
I am satisfied that because of the diversity of its members, many of which are facing the depredation of these menaces, the Commonwealth is in a unique position to take concerted action to help arrest the damage they are doing to mankind.
5.55 p.m.
The Earl of Selkirk: My Lords, after three very powerful speeches I find it difficult to know what points to deal with. We are all fortunate to be members of the most remarkable political organisation this world has ever known. I challenge anyone to contradict that. I do not believe that going back to the earliest history anything else of this character has ever existed. People all over the world are still proud and happy to know each other and learn from each other.
Perhaps I may say that the origin of the Commonwealth was the growth of standards which rested originally in this country. Members are always eager to come back and speak with us, and indeed we are delighted when they do. They sent some superb young men in the Second World War. I was perhaps fortunate in that they came mostly to the Royal Air Force. I remember being on one station when we had the pleasure of a royal visit. I was able to take people from 23 different parts of the world to be introduced to the Duke of Gloucester—I believe it was he. That is the quality of the Commonwealth. The people live in many places but mean an awful lot to each other.
I do not wish to speak for too long so I shall be brief. There used to be a curious antagonism between the Americans and India. I shall relate a story. There was a bit of trouble in the Himalayas. Two Americans from the embassy were driving through the Punjab and saw two Indian soldiers on the road. They thought it would be interesting to speak to them. They said, "Tell me, what do you really want?" They were thinking of guns, weapons and stuff like that. The reply was, "Give us British officers". That astounded the Americans. They did not believe it possible in the face of what they used to think of as our ill-treatment of the Indians.
That is an interesting difference between the European Community and the Commonwealth. We ruled. It was life which brought us together. The Community is full of regulations of every kind. This is the third time the topic has been discussed in the past week or so. I am tempted to give a German quotation from Goethe:

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"Grau alter Freund ist alle Theorie and GrÜn des Lebens goldener Baum".
That means,
"The theories are all dead, but life is what gives us the green and golden world in which we live".
That is one thing we must try and do. We must attempt to bring the Commonwealth and the Community closer together so that they begin to understand each other and can benefit by each other. That is a great task. Let us remember that we believe we live in a peaceful time—in spite of what my noble friend referred to this afternoon. But we have lived through probably the bloodiest century this world has ever known, littered with all kinds of dictators which alas we see still growing up. That is the world in which we live. We must not count on continuing peace in the world.
I was watching a programme on television the other evening in which they showed how the little animals, ants, beetles and wasps all fight. Fighting is not unusual in any form of life. If we are to have peace we must work hard to ensure that those things which can be drawn together are drawn together. The theorists of the European Community will probably say that it is impossible: I believe that it can be done. The versatility and ease of the Commonwealth will enable a close and valuable connection to be formed.
6 p.m.
Lord Pitt of Hampstead: My Lords, I too thank the noble Lord, Lord Greenhill of Harrow, for giving the House the opportunity to discuss the Commonwealth. I agree with the noble Lord, Lord Boyd-Carpenter, that we are better served discussing the Commonwealth than having the day off, because the Commonwealth is of the utmost importance in this world.
It has already been said that the Commonwealth today consists of 50 countries—four developed countries and 46 countries in various stages of development. Two of the developed countries—it is important to note this—are members of a group of seven industrial countries that now meet each year at summit level in effect to seek to manage the world economy. The problem of development, therefore, has loomed, and will continue to loom, large in the concern of the Commonwealth. The Commonwealth will need to increase its activities in this field.
The Commonwealth's stand on racism is equally important. The Commonwealth is multiracial and must therefore have a multiracial ethic. The Commonwealth has had to face the racism which was prevalent in southern Africa, and will continue to have to do so. It is a great pity that there has been a difference between this country and the other members of the Commonwealth on the question of sanctions against South Africa. I hope that the change of Prime Minister will lead to a change of attitude on this issue. I also hope that developments in South Africa will make the issue unnecessary.
The post of Secretary General of the Commonwealth was established in 1965. As we have
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been told, Arnold Smith, a Canadian civil servant, was the first secretary general and held office until 1975. He had to build the secretariat from scratch. He did a very fine job in laying the foundations for its future development. Sir Shrideth Ramphal was secretary general from 1975 until June of this year. He has been an outstanding international civil servant. During his period of office the Commonwealth grew in stature and importance as it endeavoured to come to grips with its obligation to seek to bridge the gap between the "haves" and the "have nots" and to combat racism. He has been succeeded by Chief Emeka Anyaoku, who has been deputy secretary general and therefore at the centre of activities in the Commonwealth during the whole of the 1980s except for a short period in 1983 when he was Foreign Secretary for Nigeria. He is therefore well fitted to continue the programme of work initiated during that period, to build on the foundation laid by his predecessors and to carry the Commonwealth into the next century.
In that respect Chief Emeka Anyaoku has been assisted by the decision taken in Kuala Lumpur to have a high level group under the chairmanship of the Prime Minister of Malaysia to consider the role of the Commonwealth in the 1990s and beyond. I agree with the noble Lord, Lord Greenhill, that we shall await the group's report with interest. In the meantime, the Commonwealth will continue to have to cope with the problem of South Africa by giving as much support as it can to the parties negotiating a new constitution in order to create a democratic society in that country and to enable it to rejoin the Commonwealth.
There is also the question of Europe and 1992. In that respect, this country has an important role to play. The single market is not a threat to the Commonwealth; it is an opportunity. The Commonwealth's original trade links with Britain will become links with the largest unified market—larger even than the United States—and thus provide opportunities for the Commonwealth. Therefore, our efforts towards the creation of a single market should be accompanied by policy measures to provide support to poor members of the Commonwealth so that they may be able to take advantage of those opportunities. The structures of Lomé provide one such method, but it is not the only one.
As we work towards the completion of a single European market there is increasing concern on the part of some members of the Commonwealth as to whether the existing bilateral protection, or import guarantees, can be made compatible with a common market in which there are no controls on the movement of goods across its frontiers. There is particular concern about the future of the special arrangements for such products as bananas, rum, beef and rice. The current arrangements for the import of sugar from Commonwealth countries into the EC may also be affected. Clearly, these are matters of deep concern to our Commonwealth partners, who look towards Britain to take the lead in addressing these issues.

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The future of many poor peasants and small farmers depends on the skill of the British Government in negotiating on their behalf with the EC. I hope that the Government will remember that.
6.7 p.m.
Lord Moran: My Lords, I must apologise to the Minister and to the House as I shall have to leave before the end of the debate to attend a long-standing engagement.
I am glad that my old chief, my noble friend Lord Greenhill of Harrow, for whose views I have the greatest respect, has given the House an opportunity to discuss the Commonwealth. I intend to speak mainly about the view of the Commonwealth in this country. Despite one or two losses—the Republic of Ireland, South Africa and Fiji, and some former British territories which, on becoming independent, decided not to join: Jordan, Burma, the Sudan and some others—the Commonwealth is unique, remarkable and still very much in being, as some noble Lords have said. Although more than half of its members are republics the Commonwealth has the Queen at its head as a symbol of unity—no mere symbol but the most tireless and dedicated of its supporters.
The Commonwealth is, of course, a loose association of countries—so much so that two members (India and Pakistan) fought a small but bitter war in 1965. However, it has a dense and elaborate network of relationships: meetings of heads of government every two years; meetings of Commonwealth finance ministers, other ministers and officials; Commonwealth parliamentary conferences; the Commonwealth Fund for Technical Cooperation; Commonwealth scholarships, and much else. A great deal of that activity is of real value.
As a tiny part of that network I used to enjoy the regular lunchtime meetings of Commonwealth high commissioners in Ottawa. They were lively occasions with only three white faces—our Australian and New Zealand colleagues and myself. My wife found the parallel meetings of high commissioners' wives even livelier. Nevertheless, the sad fact remains that the public attitude in this country to the Commonwealth is now, it seems to me, one of indifference. All three candidates for the leadership of the Conservative Party were asked in the past few days about their attitude to Europe. No one thought of asking what they thought of the Commonwealth. Effectively, the people of this country have turned their backs on the Commonwealth. If it were not so, the signs directing incoming passengers approaching passport control at Heathrow would not divide passengers into those holding EC passports and others, thus lumping Australians, Canadians and New Zealanders together with Libyans or Iranians.
Why has this happened? I believe it has happened for two reasons. First, when the present Commonwealth was devised after the Second World War, replacing the former British Commonwealth of Nations, we rolled together the old Dominions, largely inhabited by our own people with whom there was a very close family relationship (they had fought
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with us in two world wars) and the recently independent former colonies and dependencies with which we had a new, very important but quite different relationship. We insisted that all should be treated exactly alike.
That arrangement was not grounded in reality. It inevitably caused some resentments in the old Commonwealth. What was originally an ingenious arrangement to keep India in the Commonwealth when it became a republic ultimately became a source of weakness. Secondly, Commonwealth heads of government meetings became the occasion, as we all remember, for ferocious and sustained attacks on the British over Rhodesia and South Africa. At the posts where I served we looked forward to them with about the same enthusiasm as we looked forward to visits from British football teams.
The British people do not react vigorously to such attacks; they just shrug their shoulders and go down another road. That is what they did. There is some danger now of the same thing happening with Europe. Some of our partners are making the same mistake as our Commonwealth partners. It is a little ominous that, after the departure of Mrs. Thatcher, they are expressing the hope that her successor will be more flexible. If they go on criticising the British Government the British people's enthusiasm for Europe will go the way of their enthusiasm for the Commonwealth and, as we are one of the two main contributors, that may be sad not just for us but also for them.
Although during my time in the diplomatic service I had a lot to do with Commonwealth countries, particularly in Africa, I served in only one. I had three very happy and interesting years as high commissioner in Canada. I did not find the job different in essentials from that of an ambassador. The only real difference was that an ambassador represents the Queen and looks after visiting members of the Royal Family whereas a high commissioner represents the Prime Minister. In Canada officials went to surprising lengths to prevent visiting members of the Royal Family encountering the British high commissioner.
However, I was immensely struck by the close networks of family relationships; the Scots in Ontario and the Atlantic provinces, the Irish in Newfoundland, Quebec and Ontario, including, notably, the family of my noble friend Lord Shaughnessy. The English and Welsh are all over. Where else would one find a minister for external affairs who spoke fluent Gaelic. When we brought Mr. MacEachan to Edinburgh we had to scour the Western Isles for Gaelic speakers to talk to him.
I had the good fortune to encounter an amazing demonstration of this family relationship during the Falklands War. The Canadians knew then that we were in the right, defending a small territory with a mandatory United Nations resolution behind us. They could give free rein to their feelings. I shall never forget the letters and telephone calls that flooded in offering help, and the practical help that we had from so many Canadians from Mr. Trudea a down. It was a marvellous demonstration of solidarity. I believe

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that it owed everything to the family and historic relationships and hardly anything to common membership of the Commonwealth.
Nevertheless, I believe that we should hold on to what we have. In practical terms there is a good deal to be said for the suggestions made by the noble Lord, Lord Greenhill. I hope that they will be seriously considered.
6.14 p.m.
Lord Auckland: My Lords, the House is deeply indebted to the noble Lord, Lord Greenhill of Harrow, not only for initiating this debate but for a most impressive speech. Where are our priorities? We have had debate after debate on the European Community, and I have no quarrel with that. It is an extremely important organisation at the present time. However, after 32 years in your Lordships' House I think I can count on a finger the number of debates about the Commonwealth. I shall be rather partial in discussing primarily one country in the short time at my disposal.
Many of your Lordships have strong links with the Commonwealth. I have strong links with New Zealand. I was there last March. Like the noble Lord, Lord Bottomley, I have the honour of being a vice-president of the Great Britain in New Zealand Year 1990. It is a year which has brought New Zealand to the fore. The Treaty of Waitanki has been a historic occasion. As a result of it, in the current year much money has been raised for the foundation of an educational research establishment in New Zealand.
I am also a long-standing member of the New Zealand Society and chairman of the Anglo-South Pacific Group of the Commonwealth Parliamentary Association. I join in the hope that Fiji, which my wife and I visited in 1971 prior to an official visit to the city of Auckland, will return to the Commonwealth. I have had the privilege recently, through the good offices of the Commonwealth Parliamentary Association, to visit both Australia and New Zealand. Anyone who goes to the Domain in Auckland and sees the names of 4,000 New Zealanders who fell in Crete, and who visits the war graves centre in Canberra, will realise the debt that we owe to the Commonwealth.
We owe a debt particularly to the Maoris. I have had the privilege of three Maori welcomes in New Zealand. The Maoris have contributed enormously not only to the fight for freedom but in the education and general running of organisations in New Zealand. If ever there were an example of good race relations it is between the Maoris and what they call the Pakeha, the white population in New Zealand. There are shortcomings, but if one looks at race relations generally that is something to be commended.
While I was in New Zealand in March the delegation which comprised five Members from the other place and myself visited the Bay of Islands, Auckland, Wellington and Christchurch, all within seven days. It was a fairly heavily organised trip but well worth it. We saw a country which has strong links here. There may be a distance of 13,000 miles, but
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there are few families in this country who have not a friend or an acquaintance living in either Australia or New Zealand.
The time has come for the Government to spend far more time on the subject of the Commonwealth. Trade with New Zealand and Australia continues to flourish but there are many problems. I confess to never having been a very enthusiastic supporter of the European Community. I acknowledge, as do the Commonwealth countries, the need for collaboration between Europe and the Commonwealth, particularly New Zealand. However, having visited a kiwi fruit farm in Kerikeri in the Bay of Islands last March, I am appalled to see in our shops kiwi fruit imported from Italy. I do not know whether my noble friend has any information as to what preferences are given to the Commonwealth over the European Community, particularly concerning butter and fruit. That is vital.
I have also had the privilege, through the Commonwealth Parliamentary Association, of visiting Jamaica, another country to which we owe an enormous debt in two world wars. Noble Lords with far more knowledge than I of the Commonwealth have been allocated six minutes to speak. I shall say no more but I plead with the Government to allow proper time to discuss matters with our real friends.
6.20 p.m.
Lord Hunt of Tanworth: My Lords, I have personal reasons for welcoming the initiative of the noble Lord, Lord Greenhill, in introducing this debate. I began my Civil Service career in 1946 in the old Dominions' Office. Very shortly afterwards, as the noble Lord, Lord Bottomley, has said, I had the pleasure of carrying his ministerial bag around parts of the world. Over the following 35 years I had regular contacts with my opposite numbers in Commonwealth countries and I accompanied four different Prime Ministers to heads of government meetings in different parts of the world. I mention that simply because experience over a long period gives one a feeling for what the Commonwealth is and what it is not.
The Commonwealth is often talked about as a club, despite the fact that it has as its members more than a quarter of the world's population, people from large and small countries and from developed and developing countries. It certainly belies Groucho Marx's famous remark: "I wouldn't want to belong to any club which would have me as a member". The Commonwealth has no rules of membership and is based only on the principles of partnership and equality. Despite very great differences of size, prosperity and culture, all its members seem to value the association and want it to continue. The club connotation perhaps relates to the informality and the chemistry of its proceedings.
We should remember what the Commonwealth is and what it is not. It is not a regional grouping, a security network or a trade area. All its members belong to other regional, political and economic bodies. It is as much a red herring to say that our membership of the Commonwealth is inconsistent with our primary role as a member of the European

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Community as to say that the Commonwealth's Caribbean members should not belong to the Association of American States. The real question is whether the Commonwealth stands for good or for bad and whether it is in our interests to continue an active membership of it.
We should remember that it is the only international grouping outside the United Nations which brings together developed and developing countries from across the world, irrespective of power or culture. Unlike members of the United Nations, these different countries have certain things in common. In what is now an association of 50 independent countries, Her Majesty the Queen, in her role as head of the Commonwealth, is the only formal link with the past. But the fact remains that all 50 independent Commonwealth countries share certain things derived originally from the United Kingdom. We should not be ashamed of that. They derive from us their independence, their common language, much of their legal, educational and parliamentary systems, and so on. That is why they share so many interests and find it so easy to communicate. It is also why there are so many thriving unofficial Commonwealth bodies which owe nothing to the promptings of the Commonwealth Secretariat or governments.
But if this legacy—I deliberately say "legacy" rather than memory—of a shared colonial past makes it easy for them to find community in diversity, it also means that in this country we have a major interest in the Commonwealth's health, not as a buttress to our prestige or in thinking of it as a British Commonwealth still instead of a Commonwealth of Nations, but as a cross-section of the world in which we have special links and through which we can influence, learn and, in the case of undeveloped countries, help.
None of this is very dramatic stuff. The Commonwealth is at its best when pursuing educational co-operation and mobility rather than issuing high-flown declarations which may sound fine to those who sign them but are often forgotten. The danger is that because of the emphasis on Europe people in this country are growing up without some of the old links and do not understand what the Commonwealth means, what it is and why it is to our advantage still to be an active member of it. I very much hope that the high level group, which is preparing the report to be considered at the next Commonwealth heads of government meeting, will concentrate on what I call the practical rather than the high-flown side of the Commonwealth. I hope the Government will reassure us not only today but in their subsequent actions that the Commonwealth, despite all its imperfections, still matters to them. There is a great reservoir of friendship in the Commonwealth which we should not neglect.
6.26 p.m.
Lord Hatch of Lusby: My Lords, like the noble Lord, Lord Hunt, I have personal reasons for thanking the noble Lord, Lord Greenhill, for introducing the debate. As he knows, I have been involved for most of my life in Commonwealth
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activities of one kind or another. I look back with great affection to my work with the noble Lord, Lord Bottomley, and before that, with Clem Attlee, Jim Griffiths, Nye Bevan and Jim Callaghan. At that time—the time when the modern Commonwealth was being created—there were passing through my office Pandit Nehru, Julius Nyerere, Kenneth Kaunda, Dr. Evatt, Seretse Khama, Lee Kuan Yew, Norman Manley and many others. This was the formative period of the modern Commonwealth. I have been covering Commonwealth conferences ever since, either writing for the New Statesman and other magazines or acting as adviser. I draw the attention of the House to the statement of principles on which the Commonwealth has been based since 1971. I have a particular prejudice in favour of that statement because I was author of the first draft.
In this short debate I want to concentrate on two issues concerning the future of the Commonwealth. One has already been mentioned by my noble friend Lord Pitt. I refer to ethnic relations. One hardly need say it but in no institution or organisation in the world can the relations between ethnic communities be better worked out than in this multi-racial Commonwealth. The focal point is the attitude of the Commonwealth to South Africa. The decision to impose sanctions on South Africa has borne fruit. As Mr. de Klerk and his colleagues have admitted, it was largely the imposition of sanctions which brought the South African Government to the negotiating table with Nelson Mandela. The Eminent Persons Group of a few years ago played an immensely constructive role in pointing the way forward although its recommendations were turned down by the Government.
The Commonwealth played a vital part in the creation of the new Zimbabwe. The tie I am wearing was presented to me as one of those who collaborated with the Commonwealth delegation to the Rhodesian elections of 1980. The Commonwealth played a vital role during those elections and during the transition period. Can it not do the same or something similar in the new situation in South Africa? I believe that it can. I believe that it can help to give confidence in the building of a new constitution in that country.
However, there is another vital aspect in the future of South Africa which concerns the Commonwealth. I refer to the fact that apartheid has left that country denuded of skilled workers and with half of the black population illiterate. Where are we to turn to supply the skills which will be needed in a new democratic South Africa, and how are we to rectify that discrimination against the black population? The Commonwealth has already set up an expert group on education to undertake precisely that task. I do not believe that any other institution in the world is capable of effectively doing so.
The second issue is that of population and resources. As has already been pointed out, the present Commonwealth consists of about one quarter of the entire population of the world; that is, 1.48 billion people. It is estimated that by the year 2025 the number will have increased to 2.8 billion. That is nearly one third of the total population of the world.

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What does that mean as regards the use of the resources of the world? At present the top billion of the people in the world uses about 70 per cent. of the total energy of the world and the bottom billion uses virtually nothing. However, the situation will change; but if it is to be changed without causing disaster to the planet, it can only be changed by the use of cleaner technologies, by energy efficiency and by resource conservation.
Last year the Commonwealth secretariat produced its analysis entitled, A Climate Change. I was in Jamaica last year for the Finance Ministers' conference when the then Secretary General Sonny Ramphal made a rousing speech in the midst of the hurricane season in the Caribbean on the dangers of climate warming and the responsibility of the Commonwealth. The secretariat has now taken that factor on board and is making what I believe to be an essential contribution to this immense, crucial problem which faces us all: how to help the developing peoples of the world to create a standard of living which will just sustain life, without destroying the planet.
Mention has already been made of the fact that we are concentrating upon our membership of the European Community. We are in the Community and we shall not leave it. However, let us not forget our long-standing membership of the Commonwealth. Let us echo what has been said from all Benches this afternoon and plead with the Government to make an unreserved statement that they will constructively contribute at all times to the development and expansion of Commonwealth work in association with the European Community and not as an alternative to it.
6.34 p.m.
Lord Thurlow: My Lords, I am glad that the noble Lord, Lord Hatch, introduced the vital question of the race between resources and population in the context of the Commonwealth relationship. Later in my brief remarks I shall return to that issue as I believe it to be of foremost importance.
I very much agree with the noble Lord, Lord Hunt, that we must try to clarify what the Commonwealth is and what it is not. Like the noble Lord, I have experienced a certain immersion in Commonwealth affairs. The vast majority of our relations with Commonwealth countries, and the relationships between those countries, are conducted on a bilateral basis on broadly similar lines to those of our diplomatic relations with other foreign countries.
The collective side of the Commonwealth relationship is something which in relative terms has always been very small. I do not mean to diminish in any way the significance of what we share; indeed, this is in some ways the decade of networking—I believe that is the "in" word. The Commonwealth is the supernetwork. It has a web which criss-crosses across every type of relationship—that is, commercial, professional, governmental, parliamentary, and so on. As noble Lords have said, this side of the Commonwealth is
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immensely important and I hope that the Government will put their shoulders to doing everything they can to develop this admittedly rather tenuous and intangible field of effort.
The Commonwealth is not some kind of treaty organisation. It is not an association for defined legal, political, commercial or security commitments; it is a totally different area of international affairs. That is what makes the antithesis with the European Community a false one. I agree with the view which has been expressed that our increased sharing of sovereignty in Europe provides an opportunity and not a threat to Commonwealth countries, provided that we can bring about a greater understanding and sympathy among our European partners with the problems and interests of other Commonwealth countries. Alas, in the past that consideration has been very much ignored, although I shall not mention any names.
I return now to the issue of the main global problem of our time; namely, the race between population and resources. I believe that this is an area in which a collective Commonwealth effort could make a significant contribution. At present, under the umbrella of the Commonwealth secretariat, a modest effort is being made in the field of education and technical assistance. It covers a wide range of valuable exchanges but on a modest scale. Most international aid and most of our aid—rightly, in my view —flows on a bilateral basis or through international agencies.
The particular kind of easy, informal relationship and the collective framework which we have in the Commonwealth provide a good opportunity for pilot projects. It is timely that at this juncture the senior Commonwealth officials are focusing on the potential and the possibilities of future Commonwealth collective effort.
I have no doubt that the answer to the problem of resources versus population lies in the educational field. A crash programme of accelerated education must be introduced to enable the peoples of the developing Commonwealth countries to help themselves. No amount of available resources from the West can meet the needs of Africa and Asia, leaving aside the new claims of Eastern Europe.
It is by helping the developing countries to acquire the skills themselves in fields of agricultural techniques, health and family planning that a solution can be found, and I hope that the studies being made by this high-level group will identify this area of education as a suitable point for collective effort. Studies are at present being made at the London Business School in this particular field. When concrete plans are available, I hope that the Commonwealth collectively will come behind them.
6.41 p.m.
Lord Moore of Wolvercote: My Lords, this is the first opportunity I have had of speaking about the Commonwealth since becoming a Member of your Lordships' House. I am therefore most grateful to the

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noble Lord, Lord Greenhill of Harrow, for having initiated this debate. I strongly support the valuable suggestions he made at the end of his speech.
During a period of 20 years I had the privilege of visiting over 40 Commonwealth countries in the service of the head of the Commonwealth. I was always deeply moved by the sight of tens of thousands of English-speaking peoples in all five continents coming out into the streets to cheer the Queen. It is not possible to undergo this experience without pondering long and hard on the significance of such a remarkable phenomenon, surely unique in the history of international politics.
I came to the conclusion that there is enormous underlying strength in the Commonwealth. Shared history, common institutions and traditions, the English language, economic links and the stature of the Queen as head of the Commonwealth—all these have contributed towards making the Commonwealth a constructive and stabilising influence in world affairs. The problem that arises is how, in this fast-changing world, to make the best use of the Commonwealth in Britain's interest, in the interests of other Commonwealth countries and as an international organisation.
By and large the Commonwealth has not received a good press in Britain in recent years, largely due to the view that Britain's future lies only in the European Community. We must answer the question: what is the relevance of the Commonwealth to a Britain committed to membership of a free trade area in Europe and being pressed to join a more closely knit economic and political union?
Political integration does not seem to me to be a starter. The history of political federations is a story of disappointed hopes. Language, history and geography all make it very unlikely that Britain will join a federal political union in Europe; but, economically, the European Community is vital to Britain. Since Britain joined, the Community's share of our trade has risen from about one-third to one-half—a very significant shift. However, we have to remember that the balance of our trade with the Community is negative whereas the balance with the Commonwealth continues to be positive. In other words, what we sell to the Commonwealth enables us to buy more than we could otherwise from Europe, and our ties with the rest of the world are becoming more important to Europe as the centre of gravity in the world economy moves towards the Pacific. Our links with Australia and New Zealand, as well as with Malaysia, Singapore, Hong Kong and Brunei give us special opportunities to play a part in the dramatic growth of trade in that region.
So there is no need for Britain to choose between the Commonwealth and the Community. Our ties with the countries that share our history can help us to maintain our individuality and identity in an increasingly integrated Europe and to make our own contribution to this evolving community of nations. But the Commonwealth will not prosper in the 21st century unless there are new and constructive initiatives. It was heartening that in Kuala Lumpur the heads of government decided to set up a high-level
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appraisal group to bring the Commonwealth more into play on current world problems. I sincerely hope they will produce some new ideas to be considered at Harare next year, with, I trust, the British Prime Minister playing a prominent role.
However, this is not only a commonwealth of governments. It is also a commonwealth of peoples. We need much closer co-operation between governments and voluntary organisations working together and sharing responsibility. Sometimes one wonders whether Commonwealth governments fully appreciate the enormous potential of the non-governmental organisations and the spirit and drive which motivate them. An excellent lead has been given by the Commonwealth Foundation in the setting up of Commonwealth liaison units to co-ordinate the activities of non-governmental organisations and to underline the regional interdependence of Commonwealth countries.
Some of the NGOs are well known and have for long been carrying out invaluable work, many on shoestring budgets. To mention just one or two, there is Commonwealth Day, organised by the Joint Commonwealth Societies Council, with the Queen's Commonwealth Day Message to young people. That is marked by a variety of Commonwealth Day activities throughout the Commonwealth. There is the Commonwealth Youth Exchange Council, which does invaluable work. Then there is the Royal Commonwealth Society for the Blind, now called Sightsavers, the Commonwealth Press Union, and many others. All do very important work.
Do not imagine, my Lords, that the NGOs are all London based. Non-governmental organisations are emerging all over the Commonwealth. I give just three examples. There is the Self-Employed Women's Association of India, which is a formidable body; the Association for the Physically Disabled of Kenya and, a particularly interesting one, the African NGO Environmental Network, which is seeking to bring home to African countries the dangers to the environment of ill-considered development. These voluntary organisations are the lifeblood of the Commonwealth. Much of what the Commonwealth is able to do would be more effectively and persuasively done if the unofficial Commonwealth were mobilised and enabled to play its full part.
The Commonwealth heads of government meeting at Harare next year has a wonderful opportunity to establish a new relationship with the NGOs. The Commonwealth Foundation has already taken a valuable initiative in setting up an NGO forum, the first meeting of which is to take place in Harare some months before the Commonwealth heads of government meeting. I trust that the heads of government will give serious consideration to its recommendations. NGOs can help governments to bring the Commonwealth into the mainstream of world development and can help to build a constructive and creative partnership without parallel in the world's history. I hope that the noble Lord the Minister will be able to confirm that Her Majesty's Government

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intend to play a leading role in giving encouragement and help to the non-governmental organisations of the Commonwealth.
6.49 p.m.
Lord St.John of Bletso: My Lords, I am grateful to my noble friend Lord Greenhill of Harrow for introducing this debate and endorse the sentiments voiced by the noble Lords, Lord Boyd-Carpenter and Lord Pitt of Hampstead, that it is a pity we could not have had much longer to debate this extremely important subject today. Certainly my speech was planned for around 12 minutes and to curtail it substantially to six minutes gives me quite a problem.
My noble friend in drawing attention to the role and future of the Commonwealth has also drawn attention to the need for a collective refocusing of the energies of its members. I am encouraged that these objectives have been echoed by the new Secretary General to the Commonwealth, Chief Emeka Anyaoku, who has committed himself to the strengthening of democracy in the organisation which over the last few years would appear to have devoted itself to a large degree to combating apartheid in South Africa.
It is on the subject of South Africa that I wish to concentrate my remarks today. As noble Lords may be aware, I have spent most of my life based there and thus have the benefit of first-hand experience. At the outset I wish to voice my total support for the objectives and existence of the Commonwealth and join in welcoming the recent membership of Namibia.
That being said, some of the contradictory elements in the nature of the Commonwealth were highlighted in the events of last year and particularly at the Kuala Lumpur heads of government meeting. The organisation's public face emerged as one which sanctimoniously decried the evils of apartheid in South Africa while, in my opinion, ignoring the contempt shown by some prominent and vocal members for the principles of democracy and individual liberties and freedoms in their own countries. I am encouraged by the extremely balanced approach taken by the new secretary general, particularly to the establishment of a Commonwealth expert group, on human resources and development needs for a post-apartheid South Africa, a point which was alluded to by the noble Lord, Lord Hatch of Lusby. It is noteworthy that this group includes a member of the ANC and a prominent South African economist.
In August this year, at the 10th anniversary summit meeting of the Southern African Development Co-ordination Committee (otherwise known as the SADCC) in Gaberone, Botswana, the secretary general said:
"The Commonwealth stands ready to provide all the practical assistance towards the success of the negotiations and thereafter to contribute to the socio-economic construction of a post apartheid South Africa".
I do not know how he managed to get all that out in one breath!
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Since the Kuala Lumpur meeting last year we have seen dramatic political change in South Africa, particularly following State President de Klerk's momentous speech on 2nd February. Indeed, most of the preconditions to the lifting of sanctions laid down in the Eminent Persons Group report in 1986, and following last year's Kuala Lumpur meeting, have been met. The Commonwealth Heads of Government statement last year said, when justifying sanctions:
"Their purpose was not punitive, but to abolish apartheid by bringing Pretoria to the negotiating table and keeping it there until that change was irreversibly secured".
I would argue that South Africa is now well on the road to irreversible change. While I would not expect a total lifting of sanctions, I believe that now is the time for selective international sanctions to be lifted. This would promote much needed economic growth in the country.
All the political parties in the negotiating process for a new constitution in South Africa agree that the key to a successful and secure post-apartheid state is a strong and stable economy. This is particularly pertinent in respect of the startling demographic characteristics of the country which I have often mentioned in previous speeches in your Lordships' House. I shall repeat them briefly. It has a population growth rate in excess of 3 per cent. Over 60 per cent. of the population are under the age of 23; over 1 million blacks are migrating into the towns every year; and unemployment is over 50 per cent. These factors place considerable strains on the infrastructure and the economy.
I understand that in recognising these challenges facing South Africa, as well as the recent political reforms, the ANC will shortly ease its stand on sanctions. Clearly, however, even if sanctions were to be lifted totally now, it would not precipitate a major inflow of foreign investment into the country.
World attention has recently focused on the tragic violence in the townships. There will have to be not just a cessation of violence but a visibly stable economic, social and political environment before committed funds will flow back into South Africa. In my recent speech in the foreign affairs and defence debate I outlined what I believed were the key reasons for the unrest in South Africa. Without repeating myself, I believe that the root causes for the violence can be overcome. Just as with the rest of Africa, education, housing and health care are major issues to be addressed in South Africa. It is noteworthy that the South African Government have this year allocated substantial extra funds to tackling these matters.
To bring our focus back to the issue of this debate, I firmly believe that a non-racial, democratic South Africa can be achieved out of the current process. Such an outcome would place the country as one of the future powerhouses of the continent. Even in its beleaguered state, South Africa currently accounts for 4 per cent. of the continent's population yet produces 54 per cent. of Africa's energy, 50 per cent. of the motor vehicles, 81 per cent. of all rail freight and 30 per cent. of the continent's exports.

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In conclusion, while the possibility of South Africa applying to rejoin the Commonwealth is not high on its agenda, I endorse the secretary general's stated wish to see the return of South Africa to the Commonwealth by the end of his term of office; that would be by the middle of 1995. In that event, I can foresee the rather ironic outcome whereby a country which has been the cause of so much division within the Commonwealth will ultimately be able to provide an example of democracy and racial harmony, thereby becoming a major contributor to the strengthening of the Commonwealth.
6.56 p.m.
Viscount Buckmaster: My Lords, first, I apologise to my noble friend Lord Greenhill for missing the first few minutes of his speech. Like other noble Lords who have spoken, I warmly welcome this opportunity to discuss the Commonwealth. I shall confine my remarks entirely to Uganda because it is the country in the Commonwealth that I know best. I have addressed your Lordships on it on several occasions.
I was recently given the opportunity to visit the country again thanks to a warm invitation from the Ugandan Government which came in the name of the President himself. The Government welcomed me most warmly; it was an extremely worth while and interesting visit. I must record my warm thanks to the Government for their invitation.
On previous occasions when I spoke in the days of Obote and Amin the situation in Uganda was pretty black. There was a great deal of torture, terrorism and so on. Now I am glad to say—I wish to make this point as strongly as I can—the situation is much better. President Museveni is firmly in control and I formed the overall impression of growing peace and prosperity.
The only area of which your Lordships may have heard where there is a certain amount of trouble is in the north, in the province of Teso. I shall speak about it in a minute.
I started my tour in Kampala, where I spent four days at the Sheraton Hotel—an excellent place, well up to the standard of Sheratons all over the world. I would say that it is even better than the best hotels in Nairobi. In 1971, the year in which I left Uganda, there was a great deal of trouble caused by armed bandits known as Kondos. It was difficult to walk around in Kampala without being conscious of these people. On one occasion I saw two half-dead men lying by the roadside; it was quite a normal occurrence. No one bothered about it at all. Now I am glad to say that one can walk the streets of Kampala without any difficulty at all, even at night. That contrasts with the situation in Nairobi, where I was warned not to walk even 200 yards at half-past six in the evening for fear of being beaten up.
I was received warmly in Entebbe by the President. He told me how pleased he was that Great Britain is now the leading aid donor to Uganda to the tune of £28 million annually. That is a substantial sum. Unfortunately inflation is running at 25 per cent. and the currency situation is also serious. There are now
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1,200 Ugandan shillings to the pound sterling and there is no note larger than a 100 shilling note. Consequently one has to carry a whole sack of money about.
The President is anxious to develop what used to be called the three "C"s and the three "T"s. The three "C"s stand for coffee, cotton and copper. The copper is now exhausted but the other two commodities are being developed. The three "T"s stand for tourism, tea and tobacco.
After my stay in Kampala I was taken up by air to the north to Gulu, where I met a most active and energetic Minister who is in charge of the north of the country. That Minister, Mrs. Betty Bigombe, has many of the qualities that Ministers in your Lordships' House have. The situation there is peaceful, and under the Minister's active guidance everything is being done to refurbish and develop those areas that have been devastated by the war. Various agricultural projects are in hand and projects have also been established to help the former boy soldiers to obtain employment. One such project comprises the manufacture of bowls and similar metal objects.
The standard of living unfortunately remains low. In one area that we visited by helicopter people were appealing for blankets. Blankets are a pretty basic commodity and it is sad that people have to appeal for them. Even officials find it difficult to make ends meet. An excellent senior official showed me around. He was a man of great intelligence and he spoke perfect English. Nevertheless, he has to run a farm just to keep himself going.
I was also taken to Jinja to see various industries, particularly the fisheries industry, which is going very well. I also saw the textile and sugar factories, among others. Ugandans hope that in two or three years time they will be independent in the production of sugar. I hope with the start that has been made under such Ministers as Mrs. Bigombe and others Uganda will be able to take its place in the Commonwealth. It always has had the reputation of being the jewel of East Africa as it has an abundantly fertile soil and an able and active population. We look forward to a bright future for this country. I recommend British businessmen to invest in it, if they can find the opportunity to do so, particularly in the sphere of agricultural machinery.
7.4 p.m.
Lord Mackie of Benshie: My Lords, I too wish to thank the noble Lord, Lord Greenhill of Harrow, for initiating the debate. I thank him particularly for taking less than his allotted time for his speech. He and the noble Earl, Lord Selkirk, were two of the few speakers who did so. I wish to echo the remarks of the noble Earl, Lord Selkirk, on the Royal Air Force when he said that it was a particularly good place to study members of the Commonwealth during the war. I served in bomber command during the war, and every crew that I flew with contained a member of the Commonwealth. I remember with great affection and joy their vigour in flying, and afterwards in the various

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bars around East Anglia which the Royal Air Force frequented. However, that was the old-style Commonwealth. That Commonwealth has done us enormous good. We were all familiar with that Commonwealth and had relations with it.
As regards our present position in Europe, it must be obvious that we should remain in Europe as it should be a base from which we can do an enormous amount to increase our wealth and use it in the Commonwealth. At the present time the most important thing that we can do to help the Commonwealth is to reduce the agricultural surpluses which we dump on the world market at prices which ruin many third world farmers. I say that as a farmer. I expect to see the income of farmers and of the population in the countryside kept up by using the money in the budget in a wiser way.
We are neglecting the enormous areas and the enormous populations that exist throughout the Commonwealth. There are 110 million people in Nigeria, 100 million people in Pakistan and 800 million people in India. As every speaker has said, that represents an enormous proportion of the world's population. By a happy chance I had lunch today with a distinguished lawyer from Nigeria who is an old friend of mine. He gave me a lot of information on the current situation in Nigeria. We are neglecting that great country.
I have a certain knowledge of the French as I am married to a French lady. They are carrying out a far greater number of projects in Nigeria than we are. They are developing the gas industry. Elf and Dutch Shell have established projects in that country but there has been no move from British Gas. That is extraordinary in my opinion. In addition, the French are cultivating the Nigerians in all areas of the country. People who help France are rewarded with French decorations. We appear to be falling behind, even in education. The Government did a great deal of harm when they cut the grants for overseas students and forced up their fees. The Government forced students to seek courses in other parts of the world. The Government can and should put that position right. I hope that the Minister can give us an assurance on that. My friend also told me that some army officers now go to West Point in the United States for training rather than to Sandhurst. That is an instance of the many areas where we need to make improvements in order to improve the whole situation.
The Commonwealth Secretariat is situated in London. Compliments have been made from all sides of the House to both the past and present secretaries general of the Commonwealth Secretariat. That body is being used to enormous advantage throughout the whole Commonwealth. However, I know that this country does not provide the entire budget for the secretariat. I understand that the budget for the running of the secretariat is about £7.9 million. The budget for the Commonwealth Fund for Technical Co-operation which is an enormously important body, is about £30 million. In this country the Rural
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Development Council —an excellent body—has a budget of £34 million. The Highlands and Islands Development Board has a budget for administration alone of over £6 million. While nobody wants to encourage bureaucracy, a body of such immense value, which represents over a quarter of the world's population, should be given the tools to do the job, particularly in the field of technical development.
Many noble Lords have mentioned the work of the Commonwealth Parliamentary Association. Its work is enormously valuable. It has probably done more good through its contacts than the meetings of the heads of states. There are also many other non-government bodies which ought to be encouraged. I attended a conference in Kenya organised by the Society of Royal Agricultural Societies, which is headed by and was started up and encouraged by His Royal Highness the Duke of Edinburgh. The goodwill and knowledge engendered in such conferences offers an example of what can be done with this enormously valuable Commonwealth to which we belong. I hope that the Minister will be able to assure us today not of the Government's commitment but of their enthusiastic support for the growth of good feeling and contact between all members of the Commonwealth.
7.12 p.m.
Baroness Ewart-Biggs: My Lords, the noble Lord, Lord Greenhill, must be very satisfied with the very positive response that noble Lords have given to his Motion today. He must also be happy with the proposals that have been put forward for its future.
The noble Lord has chosen a very appropriate time for the debate: first, because of the imminent meeting of the High Level Appraisal Group; and, secondly, because the role of the Commonwealth is growing and developing and its existence is of the greatest importance in the world today. Many people are grateful for its existence.
I should like to take this opportunity to welcome the recent membership of Pakistan and, more recently, of Namibia. I look forward to the day when changes in South Africa's political system make it possible for it to return to the Commonwealth. In that context, I was very interested by the very positive speech made by the noble Lord, Lord St. John, today.
It is important to recognise why the Commonwealth is such a key international organisation. As noble Lords have said, it does not receive much press attention. That may be because things are going quite well. I believe that the Commonwealth's unique position was very well expressed in the words of the Commonwealth Secretary-General, Chief Anyaoku, when he addressed the Commonwealth Parliamentary Conference in Harare:
"a central attribute of the Commonwealth is its ability to bridge racial, ideological and economic divides and inequalities, assisted by its common language and common professional and institutional heritage. It is an attribute that will be of increasing value to a world in which new tensions within racially and culturally mixed communities and new threats to the stability and cohesion of established nation states are appearing".

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Like other noble Lords, I should like to pay tribute to the secretary general and wish him great success in his work. I should also like to pay my respects to the secretariat.
It can be argued that the style adopted by the Commonwealth of negotiation, consensus and networking is a more appropriate and effective style than that of the majority vote and political power game characteristic of many regional and international organisations which are also trying to solve world problems.
The relationship between the United Kingdom and her partners in the Commonwealth has had its up and downs in recent years. It must be said that Commonwealth countries have been supportive of Her Majesty's Government over European Community matters, which the noble Lord, Lord Hunt, said quite rightly is Britain's main preoccupation. The Commonwealth also showed loyal support to the Government in the Falklands war. However, looking back at recent meetings of Commonwealth heads of government it would appear that the United Kingdom was out of step with the other members, particularly appearing not to share the other members' sense of vision and confidence in that body. That has sometimes meant that Britain has looked isolated within the community. Therefore, I should like to join other noble Lords who have asked for a very strong commitment by the noble Earl, Lord Caithness, tonight.
I believe that it would be true to say that the Labour Party has had a more positive attitude towards the Commonwealth. It sees the Commonwealth in terms of a modern Commonwealth rather than a British Commonwealth. It sees it as made up of free and independent nations with diversity as its great strength. It should be borne in mind that it is a group of countries which could probably survive without Britain.
I should like to put forward two ideas for the future of the Commonwealth and how its framework could be used further. The first concerns the burden of debt from which the least developed members of the Commonwealth suffer. I suggest that there might be a debtors' forum as part of the Commonwealth mechanism. As the Commonwealth is made up of countries from both the North and the South, unlike other international bodies, it is well placed to take the initiative to set up such a body and to assist those debtor countries. After all, the donor countries of the North have the World Bank to represent them. I see the establishment of a debtors' forum for the countries to the South of the North-South divide as a helpful and necessary initiative.
Secondly, the West has shown a great deal of interest in democracy in Eastern Europe. Why have we not shown so much interest in the countries of the Commonwealth which are struggling with democracy? I believe that we should show more interest in how they could achieve that rather than merely castigating them when they fail. The communiqué of the Commonwealth heads of government meeting held in Kuala Lumpur stated that:
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"one of the Commonwealth's contributions to strengthening democracy might be the provision of Commonwealth assistance in helping member countries to reinforce their election and other constitutional processes through a facility for mounting observer missions at the request of member governments".
I believe that that would be a very helpful way not only of assisting those countries in running fair elections but also of confirming that those governments have conformed to the democraiic process and are thus legitimate. I should be grateful if the Minister would say whether Her Majesty's Government support the idea of a permanent service which might be offered by the Commonwealth Secretary-General to provide a team of observers carrying his authority to oversee elections when requested.
While on the subject of human rights, a more significant role that the Commonwealth could play in upholding and developing human rights, which would be seen as an important move forward, would be to recognise the significance of the NGOs concerned with human rights. They have a very important role to play, improving awareness of and education in human rights. Also the Commonwealth Foundation should respond to the grant applications of the NGOs, as has been mentioned today. I feel that that is a very important role. Moreover, as proposed at the Kuala Lumpur meeting, it is vital that all governments which have not ratified the international covenants on civil and political rights and on economic, social and cultural rights should do so as soon as possible.
The noble Lord, Lord Greenhill, has allowed us a few extra minutes so perhaps I could ask the Minister a few questions. Will he say what recommendations Her Majesty's Government will be making at the forthcoming group meeting in Kuala Lumpur to review the future of the Commonwealth? Following the recent meeting of Commonwealth education Ministers in Barbados, can he give us the extent of Her Majesty's Government's commitment to the new higher education support scheme? Can he tell us whether the Government will increase funding to raise basic education standards in the Commonwealth? Can he say whether he is satisfied with the level of overseas students from the Commonwealth countries and does he accept that they have decreased since 1980?
To conclude, we on this side of the House wish the Commonwealth continued strength. My honourable friend George Robertson, in a speech in All Souls, Oxford, describing the Commonwealth, said that it was not some formal, stiff institution but:
"a permanent living network of people of common background enriching each other, teaching and learning from each other and broadening the minds and experience of each other".
I should very much like to support that concept of the Commonwealth.
7.21 p.m.
The Earl of Caithness: My Lords, this has been a well-informed debate on a very important organisation. We are all indebted to the noble Lord, Lord Greenhill of Harrow, for giving us an opportunity to discuss the Commonwealth. The Commonwealth

1029
occupies a unique place in Britain's affairs. I am most grateful to all noble Lords who have taken part in the debate for their interest and ideas. I shall give them careful study.
The creation of the Commonwealth out of Britain's colonial past was indeed a proud achievement. At the prime ministers conference which established the modern Commonwealth 41 years ago only eight countries were present. Since then the organisation has grown into maturity with a current membership of 50.
The Commonwealth has always been an entirely voluntary association of sovereign nations. Their common denominators are historical links to the United Kingdom and recognition of Her Majesty the Queen as the head of the Commonwealth. It was the noble Lord, Lord Moore of Wolvercote, who reminded the House of the admiration in which Her Majesty is held and indeed the excellent and admirable way in which she performs her duties.
The principles on which the Commonwealth is based and which we wholeheartedly support are set out in the 1971 Singapore declaration. They include the promotion of representative institutions and guarantees of freedom under the law, the fight against racial discrimination, the importance of economic development to narrow the gap between rich and poor and the fostering of international co-operation in the cause of peace, tolerance and justice. Approximately one quarter of the world's population lives in Commonwealth countries. Therefore we must not lose sight of the fact that ties between peoples, be they linguistic, cultural, educational, institutional or sporting, are as important as the ties between governments. As the noble Lord, Lord Hunt of Tanworth, said—I hope I quote him accurately—there is a reservoir of friendship from which all members can learn and benefit.
The last 12 months have seen massive changes in the world. A period of adjustment in international relations is inevitable. The Commonwealth was among the first of international organisations to recognise the need to set a new course for the future. As the shackles of communism were being discarded in Eastern Europe in the autumn of last year, the Commonwealth heads of government were meeting in Kuala Lumpur. As the noble Lord, Lord Greenhill of Harrow, reminded the House, Commonwealth leaders agreed to set up a high level group to identify possible roles which the Commonwealth might need to play in the 1990s and beyond. The review would also examine whether Commonwealth institutions, including the secretariat, were adequately equipped for the task.
The 10 heads of government of Australia, the Bahamas, Britain, Canada, India, Jamaica, Malaysia, Nigeria, Singapore and Zambia were invited to form a high level appraisal group. Under Malaysian chairmanship they will meet early in 1991 to prepare a report for presentation to the Commonwealth heads of government next autumn. In the meantime a group of senior officials on which the United Kingdom is represented by the noble Lord, Lord Armstrong of
1030
Ilminster, has been meeting to prepare draft recommendations for consideration by the 10 heads of government. Noble Lords will not expect me to try to pre-empt the report, but the Government hope that certain areas of activity will figure in their recommendations. Our top priorities are democracy and human rights. We welcome the strong endorsement of observance of human rights given by the Commonwealth governmental working group of experts in their report published last July. I shall have something to say later about the way in which the Commonwealth can help in that area.
Our other priorities include economic and social development with special emphasis on the need of small Commonwealth states, the problems arising from trafficking in narcotics and the illicit use of drugs, the future needs of South Africa, the problems of the third world and the environment. The noble Lord, Lord Shaughnessy, will be pleased to hear that my right honourable friend Mrs. Thatcher, when Prime Minister, wrote in a paper to the previous secretary general of the Commonwealth:
"First amongst the practical problems is the threat to the global environment".
The House is clearly concerned about the Commonwealth's future role. We believe that that role in the 1990s should be built on the success of its first 40 years. The Commonwealth should not try to duplicate the work of other international organisations. It should continue to provide a forum in which countries from many different regions of the world come together to discuss international issues. It should provide help and mutual support to members in tackling the practical problems which face them and should encourage the network of contacts between professional, educational and voluntary organisations throughout member countries.
It surprised me that very few noble Lords mentioned costs. The noble Viscount, Lord Buckmaster, did so when he mentioned our aid programme in his interesting update of the situation in Uganda. The noble Lord, Lord Mackie of Benshie, wanted us to do more but did not offer any idea of where the money should come from to carry out the programmes that he wished to see. The noble Lord will therefore be interested to know that at present we meet 30 per cent. and will continue to meet 30 per cent. both of the secretariat's running costs and its multilateral aid programme.
Our contribution to Commonwealth institutions currently amounts to some £15 million per annum. In addition, our bilateral aid to Commonwealth countries in 1989 was over £700 million—nearly three-quarters of our total bilateral aid. We also contribute substantial sums to Commonwealth countries through our multilateral aid programmes. Britain's contribution to the European Development Fund and the Lomé IV loan will be £1.36 billion over the next five years, a good proportion of which will go to help those 35 Commonwealth countries which are parties to the Lomé Convention.

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Over the years the Commonwealth Parliamentary Association has provided the means for parliamentarians from Commonwealth countries to meet and exchange views. I can tell the noble Lord, Lord Bottomley, that the CPA's United Kingdom branch, through its seminars and visits programme, has made an important contribution to parliamentary democracy throughout the Commonwealth. It was my noble friend Lord Selkirk who reminded us that recent events might lull us into a false sense of confidence in the inevitable triumph of democracy. We must not fall into that trap. Its institutions must be guarded carefully.
We were all deeply shocked by the traumatic events which began on 22nd July this year in Port of Spain when a minority group under Abu Bakir attempted to overthrow the democratically elected government of Prime Minister Robinson. The Trinidad and Tobago security forces and those Ministers not held hostage coped admirably with a difficult situation. Democracy was upheld. The Abu Bakir affair demonstrated the vulnerability of small states to a determined attack by a small band of well armed and well organised extremists. To counter such incidents there is an urgent need for closer regional co-operation between security forces and the police of those small countries. That is especially important when one considers that many countries, unlike Trinidad and Tobago, do not have the benefit of a standing military force.
I have mentioned that democracy and human rights are our top priorities. We therefore welcome the decision of President Hoyte of Guyana to invite the Commonwealth, together with the Carter Centre of the United States, to monitor the forthcoming Guyanese elections. The noble Baroness, Lady Ewart-Biggs, will be pleased to hear that we have offered to make a significant contribution towards the costs of the Commonwealth observer team. Agreement has now been reached on Opposition demands for a preliminary count at the place of polling and the compilation of a new voters' list, based on a house-to-house enumeration survey. Those developments give cause for optimism that the forthcoming elections will be held on an open and democratic basis.
The Commonwealth profile has been highest in recent years in connection with events in southern Africa. As the noble Lord, Lord St. John of Bletso, reminded us, we welcomed Namibia as the Commonwealth's 50th member earlier this year. The Government of Namibia have made a sensible, pragmatic start. The new Administration include and reconcile elements formerly at odds with one another. Britain has made a major contribution to the stability of Namibia through the training of the defence force and the police. We intend to continue military training for a second year. We have pledged an additional £10 million in development aid which will be devoted to police training, English language training, education and health. We understand that Namibians intend to
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negotiate the important question of the administration of Walvis Bay bilaterally with the South Africans. If asked, we stand ready to provide diplomatic support.
On South Africa, the Commonwealth has yet to take sufficient account of the remarkable changes which have taken place this year. President de Klerk's bold steps to restore normal political life and begin the ending of apartheid have opened the way to constitutional negotiations. We believe that the Commonwealth should acknowledge what he has done and help to achieve more. Contrary to what the noble Lord, Lord Pitt, said, we believe that the time is right to reduce sanctions.
The noble Lord, Lord St. John of Bletso, was of course right to say that economic growth is essential if the reform process in South Africa is to be successful. For that, South Africa needs outside help, but sadly the Commonwealth has yet to implement the heads of government decision taken at Kuala Lumpur last year to ask international financial institutions to study the help that they may give South Africa in the future.
On the positive side, I am glad to say that the Committee of Foreign Ministers has set up an expert group to study the human resource needs of post-apartheid South Africa. The noble Lord, Lord Hatch of Lusby, and the House will be pleased to note that that is a priority for our £8 million bilateral aid programme this year.
The Gulf crisis has had a severe impact on Commonwealth countries in Asia. Many tens of thousands of workers from India, Pakistan, Bangladesh, Sri Lanka and Malaysia have had to flee from Iraq and Kuwait. Many of them suffered real hardship as refugees trapped in the region until their evacuation could be arranged. By the end of October more than 700,000 refugees, mainly from Asian Commonwealth countries, had left the area. That is not just a human tragedy: it is a financial catastrophe for some of the countries concerned.
The political response of the Commonwealth countries has been unanimous in support of the international coalition against Iraq and the full implementation of United Nations Security Council resolutions on the Gulf crisis. My noble friend Lord Boyd-Carpenter reminded the House of the special role that Commonwealth countries played in the Second World War. The noble Baroness, Lady Ewart-Biggs, reminded us of their role, which we shall not forget, in the Falklands. Let us also not forget their present contribution. A. number of Commonwealth countries have contributed to the multinational forces in the Gulf. Australia, Bangladesh, Canada and Pakistan currently have forces deployed in the Gulf region, and others have offered their help. In addition to the practical benefits, those contributions, especially from Islamic countries, will have sent important signals to Iraq to reinforce the message that the crisis is not divided along social, economic, political or religious lines but merely concerns perceptions of right and wrong.

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I should like to answer one or two other points that were raised. My noble friends Lord Boyd-Carpenter and Lord Auckland both said that they would like to see Fiji returned to the Commonwealth. Having just had the pleasure of visiting the country, like the noble Lord, Lord Bottomley, to learn at first hand how some of the countries work—I also went to Tonga and Vanuatu which are currently members of the Commonwealth—I can only endorse their remarks and say that I hope that Fiji will soon return to the Commonwealth.
A number of your Lordships mentioned Britain's role in the Community and in the Commonwealth. I agree with the noble Lord, Lord Hunt of Tanworth, that there is no incompatibility in membership of both. He asked how our membership of the Community could help Commonwealth countries. The right thing to say at the moment may be that we can offer enormous help by bringing the Uruguay round of the GATT negotiations to a successful conclusion. We have the advantage of being in the Community and possessing the knowledge of how the Commonwealth feels. Having lunched at New Zealand House today, I am well aware of how strongly New Zealand feels about some parts of the GATT round.
We must keep trade free. We must not resort to protectionism. In answer to the noble Lord, Lord Thurlow, the best thing that we can do for developing countries in the Commmonwealth and outside is to keep trade free because protectionism will harm them today just as it harmed them before the Second World War.
The noble Lord, Lord Moore of Wolvercote, mentioned the excellent work being carried out by NGOs and the Commonwealth Foundation in encouraging closer links between Commonwealth NGOs, especially through the establishment of national Commonwealth liaison units. In Kuala Lumpur, the Commonwealth heads of government welcomed the proposal to establish a regular Commonwealth forum of NGOs to discuss matters of mutual interest and concern. We are pleased to note that the first such forum is to be held in Zimbabwe in August 1991 at the invitation of the Government of Zimbabwe. Such initiatives can help only to develop closer Commonwealth understanding and cooperation to the benefit of all member states.
The Commonwealth agenda is a long and complex one. Senior officials are meeting today in Port Moresby to discuss those issues. It is a regular meeting which takes place between Commonwealth heads of government meetings. Next year's heads of government meeting will of course take place in Harare as many of your Lordships have reminded the House.
The noble Lord, Lord Greenhill of Harrow, asked me to take on board a number of his suggestions. He asked for a clear statement of the Government's support for the Commonwealth. I make that gladly now. He asked about a Minister for the Commonwealth. I can assure him that although my honourable friend Mr. Hogg is much preoccupied,
1034
and rightly preoccupied, with the situation in the Gulf, he has not forgotten his responsibility for the Commonwealth. He asked that we reconsider the number and purpose of Commonwealth meetings. That is one of the tasks of the high level appraisal group.
I join all of your Lordships in welcoming the appointment of Chief Anyaoku. His efforts to meet the challenges of the next decade have our full support. I hope that the noble Lord, Lord Greenhill of Harrow, will agree that our commitment is not a burden, a sadness, to us. We are not committed by the judge of history to a gaolhouse called the Commonwealth. Rather we support willingly and fully one of the most dynamic international organisations in the world today.
7.39 p.m.
Lord Greenhill of Harrow: My Lords, I thank the noble Earl for his informative summing up. I thank also the many Members of the House who have taken part in the debate. Its most useful result has been to establish the need for a further full-scale debate on the subject next year, well in advance of the meeting in Harare. I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

Code of Local Government Audit Practice for England and Wales
7.40 p.m.
Viscount Astor Viscount Astor rose to move, That the draft code laid before the House of 15th October be approved [28th Report from the Joint Committee, Session 1989–90].
The noble Viscount said: My Lords, the Audit Commission was established under the Local Government Finance Act 1982 as an independent body responsible for the appointment of external auditors for local authorities and for assisting all such authorities in securing value for money in the services which they provide. Under Section 14 of the 1982 Act the Audit Commission is required to prepare and keep under review a code of audit practice prescribing the way in which auditors are to carry out their functions under Part III of the Act. The functions of the commission were extended to cover health authorities under the provisions of the National Health Service and Community Care Act 1990.
The new code which is necessary as a result has been prepared by the commission. My role in the matter is limited to bringing the code before the House for consideration and, I hope, approval. The commission believes that the new code should be a single document covering both the audit of local and health authorities so they have revised and extended the existing version. The code must receive parliamentary approval at least every five years, although the commission can make alterations to the code in the intervals between its being approved. The present code, which came into effect on 9th February 1988, was revised by the commission on 7th July 1988

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to deal with the new powers on prohibition orders and judicial review introduced by the Local Government Act 1988.
I believe that the existing code has helped to ensure that auditors' functions under Part III of the 1982 Act have been carried out effectively. The Audit Commission has now prepared this revised code which is before the House. As this revision deals with health service bodies for the first time, the commission considered that the code should be brought before Parliament for approval, even though less than five years have elapsed since the code was last approved.
The commission has consulted the bodies most directly concerned—local authority associations, the accountancy profession and for the first time organisations connected with the health service—as required by the 1982 Act. In addition, the code has been the subject of consultation with the commission's own auditors (the National Audit Office), the District Audit Service and the private accountancy firms.
The new code in essence extends the existing code which applied to local authorities so as to cover the National Health Service, with the exception of those matters where extending is simply not possible. The principles of local authority audit have been well established and the code itself is well regarded. In the circumstances, I believe that the commission is right to stick to a proven formula.
Before going any further perhaps I may remind your Lordships of the main features of the new code and outline the principal changes from the existing code, particularly those features which the commission itself regards as important. First, the introduction explains why the commission has framed the code as it has done and points out that not all aspects of code will be appropriate for the audit of what the code calls "non-principal" authorities. These authorities include parish and community councils and in the National Health Service general practice fund holders.
Perhaps I may now turn to the main body of the code. Although this is considerably rearranged compared with the existing code, much of it is effectively unchanged other than for changes necessitated by the extension of the commission's role to the health service. The code is now divided into five parts. The first part sets out the general duties of the auditor and includes a new section at paragraphs 13 and 14 dealing with audit objectives. The second part of the code contains new matters in paragraphs 17 to 23 inclusive dealing with the carrying out of the audit and identifies matters to which the auditor should pay particularly close attention; for instance, fraud, corruption and value for money. Paragraphs 24 to 39 of the second part and the whole of the third part bring together the auditor's reporting responsibilities and are for all practical purposes an unchanged rearrangement of the existing code. Part 4 is specific to the audit of local authorities and is merely a rearrangement of the existing code. Finally, Part 5 is entirely new and is headed "Audit of Health Service Bodies". In this part of the code the commission stresses that auditors of health service bodies have
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particular responsibilities in addition to those which are common to both local government and the health service.
Under Section 20(3) of the National Health Service and Community Care Act 1990 the auditor has a duty to report to the Secretary of State where it is believed that an authority's or officer's action would be unlawful and cause a loss or deficiency or an authority's or officer's decision would involve unlawful expenditure. The procedure differs from that in local government where the auditor faced with similar matters has to decide whether to issue a prohibition order or apply to the court for a judicial review of the decision taken.
The new code of practice, which I stress once again is the work of the commission and not of government, is simply an additional part of this process of extending the commission's role to the health service. I hope that the House will agree that the commission has performed its task in a thoroughly professional manner and produced a code which sets out a sensible and practical approach for auditors to follow. I beg to move.
Moved, That the draft code laid before the House of 15th October be approved. [28th Report from the Joint Committee, Session 1989–90]—(Viscount Astor.)
Lord Graham of Edmonton: My Lords, on behalf of Members on these Benches I do not intend to say a great deal about the code. As my honourable friend Mr. David Blunkett said in another place, it is not a matter about which we wish to divide the House because there is common agreement among all parties about the value of the Audit Commission and ipso facto its papers, documents and recommendations. The idea of the Audit Commission raises no dispute. It deals with the proper manner in which local government can be monitored and be seen to be acting correctly, and that is in order.
The Minister rightly drew attention to the possibility of fraud or corruption. Local government is no different from any other type of government or company, private or public. There is no more fraud or corruption in local government than there is in any other organisation. Indeed, there may not be as much. In our view the Government and the Audit Commission sometimes unfairly belabour a point when they find examples of cases which must be dealt with severely, although Members on this side of the House have no brief for any practice which is detrimental to the welfare, well-being or good order of the local and national populace.
We hope that those who have power in such matters will use their nous and look at the situation sensibly. We hope that they will try to understand the nexus in which local government operates in 1990. There are present in the House Members with as much experience as myself. We know that councillors and council officers have a horrendous job in keeping out of trouble—not criminal trouble—and difficulty because of the vastness of their burden and the shortage of resources—problems which have been visited upon them by the Government.

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I support the views put forward by my honourable friend Mr. Blunkett, who said that following the 1988 and 1989 Acts there are whistle blowers and regulations to ensure that people do not step over the boundaries of the law. That is entirely sensible and in the circumstances based very much on his experience.
It is right and proper that there is the Audit Commission and the code of practice. However, the code needs to be operated and exercised with some understanding of the realities for the people who have a great deal of work to do for their communities in very difficult circumstances. My noble friend Lord McIntosh is not able to be here to deal with this matter but on his behalf I say that we believe that the Audit Commission and its work is to be supported and this code of practice should be approved.
Lord Donaldson of Kingsbridge: My Lords, I endorse what the noble Lord has said.
Viscount Astor: My Lords, I am grateful to the noble Lord, Lord Graham, for his support for the commission's role. The code of practice of which I have spoken reflects the Audit Commission's decision to extend the scope of the successful code supplied to local authorities to cover health service bodies. Therefore, I hope that your Lordships can accept this Motion and I commend it to the House.
On Question, Motion agreed to.

Overseas Domestic Workers
7.50 p.m.
Lord Hylton Lord Hylton rose to ask Her Majesty's Government what steps they will take to prevent exploitation of, and reduce the hardships suffered by, overseas domestic workers admitted to this country under the Home Office concession of 1980.
The noble Lord said: My Lords, the redress of grievances is a prime function of Parliament. My Question this evening addresses the grievances of a limited group of people; namely, those admitted to this country without work permits to accompany or join an existing employer who intends to visit or reside in Britain.
Since 1980, employers have come from Greece, Hong Kong, Nigeria, Singapore, the United States and many mid-Eastern countries including Bahrain, Iraq, Kuwait, the Lebanon, Saudi Arabia and the United Arab Emirates. The employees who have suffered injustice and exploitation have come mainly from developing countries in the Indian subcontinent, Indonesia, West Africa, Morocco, Ethiopia, Eritrea, South America and in considerable numbers from the Philippines. In many cases workers were originally recruited in or for the Middle East.
Since 1986, some 600 cases of exploitation have been documented. Therefore, cases have been occurring at the rate of about three per week and I am sorry to say that matters have worsened since the invasion of Kuwait. Many domestics, perhaps a majority, experience the confiscation of their passports. The result of that is that they do not know
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their exact immigration status, which is usually that of a visitor or a person named to work for a specified employer. Many such workers have no written contracts of employment or their contracts are arbitrarily changed. Their wages are often withheld or paid in kind. They are compelled to work excessive hours and numerous examples can be quoted of deprivation of food and privacy or denial of access to friends or indeed to the outside world at all.
It has been rightly said that some servants only see the airport, the employer's house and the road between the two. Many have been physically abused or attacked by employers or their children. Most domestics are women and many have suffered sexual abuse, including actual, attempted or threatened rape.
If, in response to appalling treatment in a supposedly free and democratic country, a domestic runs away from the employer, he or she remains in great difficulties. Such people are frequently without money, personal possessions or accommodation. No passport may mean no health care and they are wide open to further exploitation by subsequent employers or landlords. They become illegal persons as unauthorised immigrants or overstayers. Therefore, they are liable to deportation without a right of appeal from within the United Kingdom unless they have already been here for seven years.
Here I should like to pay a warm tribute to the work of organisations such as the Asian Women's Resource Centre, the Commission for Filipino Migrant Workers, and Kalayaan, which incidentally is a Malay word meaning freedom. Without those bodies the suffering of abused and exploited workers would have been much greater. The Anti-Slavery Society has also been most helpful on all the human rights aspects of this matter.
Rather than after-care, we now need the prevention of abuse. My attention was drawn to this matter originally by the case of Mrs. Laxmi Swami. That Indian lady was falsely imprisoned and barbarously ill-treated by two Arab princesses over a four-year period. She escaped from her employers and after a five-year legal struggle was awarded damages of £300,000 by the High Court last December. That resounding victory for British justice coincided with an Early Day Motion signed by 104 honourable Members of another place. There was also a petition to the Home Secretary which attracted some 4,000 signatures.
I am glad to say that since then there has been modest progress. In March this year the noble Lord, Lord Pitt, who I am glad to see will be speaking this evening, and I met the noble Lord, Lord Strathclyde, at the Department of Employment, together with officials representing the Home Office. Consultation then followed with the Foreign Office and on 24th July the noble Earl, Lord Ferrers, was able to announce in reply to a Written Question that entry clearance procedures would be reformed and improved and that information leaflets would in future be issued to both employers and domestics at the entry clearance stage.
I have seen the leaflets in draft and they try to set out the legal rights of domestics and the protection available to them under United Kingdom law. I very much hope that the leaflets will clear away many illusions and will be effective in protecting domestics coming to Britain in the future.
That welcome governmental action does not solve the problems of domestics who are already here. They fall into two classes: first, those who are still with their original employer; and, secondly, those who have left their employer, usually because of exploitation, maltreatment or abuse. Perhaps I may give two examples. Cherry is a Nepalese woman. She was not paid her wages and her employer kept her in captivity in London. She was at first refused medical treatment and was only later allowed to go to hospital. After a partial recovery there, she left her employer.
My second example concerns Sally. She is aged 26 and comes from the Philippines. For three years she endured harassment, verbal abuse and aggression caused by children. In London she was never paid; her passport was withheld and she was locked in. Eventually she climbed out of the third floor window only to fall from a drainpipe, breaking her pelvis and arm in the process. I am glad to say that she is now free.
I urge Her Majesty's Government to act immediately to help people such as those in the examples I have given. They did not come to England to submit to virtual slavery. The concession made in 1980 to employers needs to be matched by a parallel concession to the employed. In the past the Department of Employment has argued that domestics who are exploited should make use of industrial tribunals and civil and criminal litigation in order to protect their rights. I regret to say that that view is totally unrealistic. Few resident domestics will dare to use those procedures while they are still in employment. If they leave or are sacked, they immediately breach their conditions of entry and become liable to deportation. Again, in that situation few will risk embarking on proceedings for which legal aid may not be readily available. Rights are a pure illusion unless they can in practice be fully exercised.
What is the remedy? I ask Her Majesty's Government to provide these domestic workers with an immigration status which enables them to work and above all to change employers. That is the remedy asked for by the Early Day Motion, by a meeting organised through the Commission for Racial Equality in July this year, and by the voluntary bodies closely involved. Even if a change of employer is limited to the same category of work, it will be a cheap and effective remedy. Employers will stand to lose their employees if they do not treat them properly. Employees will have an alternative to exploitation. Such a change would be consistent with existing immigration practice.
I ask the Government to consider other safeguards. They could insist on written contracts of employment signed by both parties for all domestics coming to this country for more than a month or two. That is the Canadian practice. They could arrange for regular
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spot checks on employers by authorised inspectors who must be able to see each domestic in conditions of privacy. I understand that that is what happens in the Netherlands.
Finally, there is the question of those who entered under the concession and are now overstaying. Will the Government regularise their position provided they remain in employment? Will those people be allowed to apply for settlement once they have lived here for four years? That would do much to reduce the hardship suffered by separated families, the hardship that stems from economic necessity and the pressure of intractable circumstances.
I am grateful to all those taking part in the debate and thank them in advance. I believe we have identified urgent grievances. I have attempted to outline remedies. If the Government have better solutions I look forward to hearing them. Meanwhile, let us remember the famous judgment of Lord Mansfield in the case of Somersett in 1772, when he said:
"Every man who comes to England is entitled to the protection of English law".
The poet Cowper wrote:
"Slaves cannot breathe in England. They touch our country, and their shackles fall".
The time has come to apply those maxims to the present situation. I look forward to hearing the debate and in particular the Government's reply.
8.2 p.m.
Lord Pitt of Hampstead: My Lords, I should like to support the noble Lord, Lord Hylton, in this Question. I have had my attention drawn to this problem and cases have been mentioned to me regarding people who have been treated badly.
I know that the Government feel that people coming to this country from abroad with a household and employees should be allowed to bring those employees, otherwise they may find themselves in difficulty. I understand that. But the Government should lay down conditions so that when those employees are brought into the country they are entitled to certain forms of treatment. The contract suggested by the noble Lord, Lord Hylton, which I understand is used in the Netherlands, is one way of doing that. Another method of dealing with the problem is laying down conditions at the port of entry and providing a means of inspection. The inspectors would know the address and be entitled to visit the employees and ensure that their living conditions are lawful. To allow the problem to continue is quite wrong.
It is wrong of the Government to allow people to be brought into the country and virtually treated as slaves. It is not enough to say, as the Department of Employment says, that they should use the industrial tribunals. That is ridiculous. Once they leave their employer they in effect become immigrants with no right to be here. Therefore they could be deported. If, when they went to the tribunal, the tribunal or the Home Office had the right to allow them to remain in this country, that would be another way to solve the

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problem. I do not know whether the Government would wish to use that. Merely to say that they should go to an industrial tribunal is nonsense.
I know the Minister has a brief, but I should like him in the course of replying to bear in mind the suggestions made. I ask him to look at the matter from the point of view of an individual who entered employment and as a consequence is brought into a strange country and kept as a virtual prisoner. No government could regard that as right; it must be wrong. Therefore for the Government to find a solution that is capable of application—not a spurious suggestion such as going to the industrial tribunal—is vital. I hope that the Minister will say that he has accepted the suggestions made by the noble Lord, Lord Hylton.
Finally, I wish to raise the question of wiping the slate clean. It is a fact that some people living in those conditions have run away from their employer. If we are to start afresh and ensure that we resolve the problem, we should make it possible for those people to register. If they have lived in this country for a certain period they may perhaps be allowed to stay. We need to clear the matter up. I hope that the Government will tell us that in some way or other they will deal with it.
8.7 p.m.
Lord Donaldson of Kingsbridge: My Lords, like everybody else who has looked at this problem I was deeply shocked by the cases quoted by the noble Lord, Lord Hylton, to which my noble friend Lord Pitt also referred. I have seen a good many more examples written down. I shall not quote them; the evidence we heard was enough for us to insist on action. It is incredible that such abuses should be occurring in our country in 1990. I am certain that the Minister and his colleagues must feel as I do. Therefore it is a question of deciding not that something should be done if possible but that something must be done at once.
I do not want to go through the particulars again because the noble Lord, Lord Hylton, made them very clear. I am informed—perhaps the Minister will confirm this estimated figure—that there are around 3,000 situations of this kind, with one and sometimes more domestic workers working for an employer, usually a family, who have moved in for reasons considered acceptable to this country, sometimes for a visit and sometimes for a very much longer stay.
When these families come here they bring with them a domestic worker who is given a visa for six months if it is a short stay; it may be for a year. The visa is on a passport which almost always is held, sometimes in a perfectly honest and decent way for convenience, by the employer. Therefore, if something goes wrong the domestic worker has absolutely no redress. I am told that the Commission for Filipino Migrant Workers to which the noble Lord, Lord Hylton, referred has dealt with over 200 cases a year which have gone wrong in one way or another. An employer can be, and in some cases has proved to be, extremely ruthless.
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If we agree that the situation must be rectified, I suggest that it is a simple matter, with a simple solution involving only two changes. I am merely repeating what the noble Lord, Lord Hylton, said but in slightly different terms. The first change has already been proposed by the Minister in his Answer in July to the Question of the noble Lord, Lord Hylton; namely, the issue of information leaflets to employers and employees at what the Civil Service calls the entry clearance stage. I suppose that means when the family enters the country and obtains clearance—setting out the legal rights of domestic workers and the protection available to them.
Incidentally, that action was promised for the autumn but as the autumn officially becomes winter in November it is already overdue. A delay from July to November cannot be accepted. I ask that the Government certainly get this action, which is the easiest part of our recommendations, into operation by Christmas. I know that the Minister cannot make promises, but I hope that he will tell the House that he will try to do that.
There is an important point in that connection which was made by my noble friend Lord Pitt. It is not enough just to send these information leaflets to people as they come into the country. They must be sent to every person who has already come into the country; at any rate to each family. If workers are not with a family, the Home Office must endeavour to ascertain where they are and, as my noble friend Lord Pitt said, at least put matters right on a temporary basis.
The second stage to which the noble Lord referred will need more ministerial determination to get through. It will not get through because we say that it ought to. I believe that the authorities would rather not do it. There are difficulties. Therefore, I ask Ministers—our representative here, his newly appointed chief and everyone else concerned—to acknowledge that the position cannot continue and that if the authorities see difficulties they will have to find a way out of them. That is the kind of order I expect Ministers to give.
In order that these workers who enter the country are allowed to change their jobs, on proper notice, and to leave their employer to find another more congenial position—provided they do not go outside the domestic worker field—they must be given something like official immigration status, independent from their employer. That is the issue and clearly there are a number of different ways of doing that. One such way would be to give the worker a permit with a certain limitation, but I do not want to go into details. However, they must have official immigration status independent from the employer.
As regards workers leaving one employer and going to another, there is a good demand for domestic workers. A worker who is unhappy should be allowed to give notice and go to an employment office where similar work can easily be obtained. The new employer would have to renew the visa. I suppose the immigration authorities would fear that such a scheme could constitute a simple path to increased

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immigration, but I believe that their fears are exaggerated. The worker would be told that it is essential to obtain a new visa. The authorities would be advised because the employer would have to notify them that notice had been given. That could be tied up by any competent civil servant. It should be a rule that due notice should be given by the worker and that the employer should advise the immigration authorities, who could then check with the worker. That sort of checking is done every day all over the world and there is no difficulty whatever.
However, nothing is foolproof. As matters stand today, workers can leave and find work privately. By doing so they stay on in this country on an unauthorised basis. A worker who suits a new employer will never be heard of again by the authorities. Therefore, the plan I am putting forward would stop illegal arrivals from staying and put the whole situation onto a proper basis. In any case, we must bear in mind that the numbers are very small. It is worth risking one or two unauthorised workers slipping in so that we can put right some of the terrible things that have been described.
I am told that there are over 3,000 of these domestic workers, and of those only about 200 a year give any trouble. When compared with immigration as a whole, the numbers are trivial but the damage that is being done is not trivial. Therefore, I earnestly request the Government to take some action. The bad cases are so bad that we cannot accept anything from the Government but effective action. We have said exactly what should be done and there is no difficulty in doing it.
There is one further point, to which my noble friend Lord Pitt referred. The next step should be to allow a worker who has worked with a visa for four years to have indefinite leave as a resident in Britain. At the moment that is granted to anyone who holds a work permit and who stays for four years. I believe that it should apply to the workers we have been discussing but who at present have no work permits.
In this country 100 years ago domestic workers—or servants as they were called—were liable to treatment which was better than the stories we have been hearing though in some cases it was nearly as bad. Most family households lived happily in a way which was almost feudal. However, servants could sometimes be very badly treated when things went wrong. Thank goodness the position today has been reversed. Only the rich have servants who live in, and they live in terror of losing them. Those of us who can afford a daily lady, even once a week, are very much at her mercy, as most of us know very well. I can see that there could be a case for allowing foreign families to enter the country, but they must not bring the bad habits of 1850 into the 1990s.
I want to hear from the Minister that he will make perfectly clear to his colleagues that no answer will satisfy us except that immediate action will be taken on the lines I have described, or action which will have exactly the same effect.
8.17 p.m.
The Earl of Longford: My Lords, we are all extremely grateful to the noble Lord, Lord Hylton. He possesses the quality of gracious indomitability which I think derives from his great-grandfather, Mr. Asquith, as he was when Prime Minister. Of course in his later days Mr. Asquith acquired a somewhat negative image. He was associated with the phrase, "Wait and see". However, the noble Lord is not asking us to wait and see but to look at the situation and to do something about it.
In fact, Mr. Asquith was described rather better by Sir Winston Churchill in a famous essay in which he explained how tough he was. He used the phrase that his achievements were not all done with rosewater. That, I believe, is underlying the genial exterior of the noble Lord and his certain toughness—ruthlessness perhaps. I hope that the Minister will take the message that he is not dealing with a lot of wets but with people who are going to threaten his career. I have not seen the tape but I hope that the Minister has gained some promotion. He deserves promotion but he must first achieve something in this field.
I know that he cannot just announce the new policy. There is a new Minister and he is a gentleman whom we wish well, as we do the many Home Secretaries under whom some of us have had to suffer in years past. I had better be careful because his predecessor is a gentleman with whom we shall have many contacts. We shall want to obtain many favours in the immediate future so we do not want to say anything disparaging about him.
The new Home Secretary is a gentleman who is clearly anxious to please. I hope that he will realise that there is a very easy way of pleasing us. As the noble Lord, Lord Donaldson, said in his statesmanlike speech, it is a very small problem. According to my information, about 3,000 people are involved. I hope that the noble Lord, Lord Reay, will not simply put us off with sweet endearments. I hope he will inform the Minister that there is an easy way for him to make his name quickly although he may not have very long to do so of course. I hope all these matters will be brought home to him in the most forceful way possible.
The main points have been very well made by the noble Lord, Lord Donaldson. However, one note that he struck made me feel anxious. He described the almost privation under which he is living. Apparently, it is only with difficulty that he can afford a lady to come in once a week and who tyrannises him. I know that old Etonians like the noble Lord, myself and Mr. Hurd, are inclined now to explain that we are really very impoverished and that we went to Eton because of a scholarship. The noble Lord and I have had comfortable lives. I am sure that the noble Lord would be the first to point out that the people we are concerned with have had very uncomfortable lives. The noble Lord, Lord Donaldson, referred to a state of affairs which one would consider incredible for this country.

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I got involved with this matter partly through the activities of my endlessly active daughter. Since then I have learnt some of the facts. A few months ago I would have said that all the problems were just bilge invented by the communists or suchlike people. Yet these events are taking place. There is no doubt that slavery is taking place in England. Who would have thought that such a state of affairs was possible? The main points have been covered and I shall not go over them again. I support the arguments which have been well-stated by earlier speakers.
In order to give a little first-hand vividness, I shall refer to two young women to whom I shall not give their true names. They have been to see me here. Sanda (though that is not her real name) is a 30 year-old Filipino. She was brought into this country by two employers, a Palestinian male and an Englishwoman. She was not allowed out. For three months she lived in a small room without heating and very little food. She was left scraps. I do not say that they were the actual crumbs that the dogs ate under the table. She was hit with ashtrays when the employers became displeased with her.
She was caring for a four year-old child and at one point both of them fell down stairs, no doubt accidentally. I am sure that these facts can be verified. I am not joking when I say that the woman employer took a knife to kill this wretched Filipino lady. Luckily, there were guests in the house who pulled the employer away. That is a true story and anyone who doubts it can no doubt have it verified. The woman had no rights whatever which is the position brought up by earlier speakers. If she tried to escape she would be picked up and no doubt sent back to the Phillipines where she would try to support her family. That story was told me just a few yards from here by the woman.
Another story involves a woman I shall call Cely. She was a machinist. She needed a job to help support her mother, brothers and sisters in the Phillipines. For four months she was not paid any money at all. The children were hitting her, spitting at her and pulling her hair. She slept on the floor in the lavatory. She escaped out of a window and fell down two floors. She broke her pelvis and her arm. She showed me her broken arm so I have no doubt about that. In a way that incident enabled her to escape because she was picked up by kindly persons and taken to hospital. She stayed in hospital for two months. Then she went to one of the excellent organisations which help people in distress.
I have related those two stories because they illustrate what we are talking about. As the noble Lord, Lord Donaldson, said, it is incredible that such events should be happening in Britain. When I say that there is no sign of it being stopped, I am not sure that the noble Lord, Lord Hylton, would agree with that. I think he said that some improvement is being made. These events, or others very much like them, are taking place at the present time.
I do not need to deal with the remedies because they have been well-explained. The most crucial factor is to enable these people to leave their employers and work
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for someone else. I believe the noble Lord, Lord Donaldson, has called for them to have a state of independence from their employers. The solution is fairly obvious. I beg the Minister not to make a pronouncement tonight which he cannot stand by, but to bring home to his new chief the extreme feeling which has been aroused already and which I am sure will grow even more intense in the future.
8.26 p.m.
Lord Wilberforce: My Lords, in view of the fact that the noble Lord, Lord Hylton, in opening this debate was good enough to refer to the Anti-Slavery Society, of which I have the honour of being the joint-president, perhaps I may be allowed to add a few words. The society is very much concerned with this problem internationally. It is worth bearing in mind that it is an international problem and it is not peculiar to this country. The same kind of situation is known to exist in a number of European countries. The Anti-Slavery Society has been looking into it and it has put in a quite detailed report to the working group on contemporary forms of slavery.
However, this evening we are only concerned with this country where undoubtedly a very serious and tragic number of events have taken place. We do not know exactly what is the scale of the problem. Our society asked the Home Office how many people there were in the category of domestic workers. We were told that no figures exist for the number of domestic servants admitted as visitors each year and who have employers. That is hardly good enough. One should know how many of these people there are and where they are. One wants to know the scale of the problem and the locations of the people so that the welfare organisations can make contact with them.
Some quite simple administrative action at the entry and clearance place should enable the Government to have a proper record of the scale of the problem. Undoubtedly the problem does exist. Noble Lords may be fairly near the mark in estimating the total number to be between 2,000 and 3,000. That is only a guesstimate at the moment although an intelligent one. Undoubtedly there are some cases of what is known as debt bondage. People have incurred expenses either through their flights or the agencies and they are not given any wages until the money is repaid. As a result girls who come here with the intention of supporting their families in the Phillipines or in Manila are unable to send any money back until the debt is repaid. The debt is a millstone around her neck. Noble Lords know perfectly well that debt bondage is itself contrary to the slavery conventions quite apart from other forms of deprivation of liberty which may be called quasi-slavery. However, apart from that, as many noble Lords have said, there are cases which can be described as in effect cases of slavery. If someone from a hypothetical country in Africa or Asia said, "I am willing to come to Britain. If I do so, I shall bring a good deal of money but I must bring my slaves with me", no government would dream of letting him come. If he came, the moment he set foot on English soil the slaves would be free. That opens the door to the point made by the noble Lord,

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Lord Pitt, that the Government would be perfectly entitled to impose requirements on people coming here to ensure that conditions of actual slavery, quasi-slavery or debt bondage did not exist.
The detailed remedies have been well explained, in particular by the noble Lord, Lord Donaldson. I should like to comment on the scheme being introduced by the Home Office for the issue of information leaflets to employers and domestics at the entry clearance stage. That is all very well but it is not much use if all it does is set out the legal rights of domestics working here. The whole problem is the giving of a visa limiting employment to one person only and thereby not allowing a change of employment. If the person concerned leaves the employment, she becomes an illegal immigrant, she is immediately criminalised and under the 1988 Act can be deported without any possibility of appeal. The matter must be tackled through the form of the visa. It must be open to those coming in to seek employment within the same category. They should not be put into a criminal category. If they are here for a certain time they must be given the right of settlement.
I need not expand further on those points. I wish to emphasise the great interest of our society in this matter. We owe a debt to the noble Lord, Lord Hylton, for taking the issue up and for making such efforts in bringing the problem to the notice of the authorities.
8.32 p.m.
Lord Monkswell: My Lords, I had not planned to speak in the debate, but the subject before us is one of great importance. I am angry about the plight of domestic workers, which has been reported in our newspapers and described by noble Lords during the debate. I completely endorse what has been said by other speakers. I am sure that the Government would agree with what has been said.
The noble Lord, Lord Pitt, pointed to the key problem of the immigration status of these people. I have two proposals. The first is fairly practical. There is a need for a widespread understanding of what we mean by acceptable employment standards. It is all very well to hand out leaflets at points of entry, but that is not enough. The vast majority of people living in this country obtain from television information about the social mores of society.
I would hope that the BBC, ITV and the independent television production companies could make television programmes for peak viewing times to explain the importance of acceptable employment standards for domestic workers. They should further explain the revulsion felt by British people to the excesses referred to during the debate. I hope that my remarks will be drawn to the attention of the television authorities.
I turn to my second proposal. We have heard how in one incident redress was sought through the law courts. A sum of £300,000 was mentioned. That is all very well for people who can take part in our legal system. One needs to be fairly well off or be able to
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find a well-off patron in order to take part in our legal system. From my experience as a local councillor and from knowing Members of another place and of the European Parliament I feel that the avenues of democracy could be useful in trying to tackle this problem. It is important that democratic representatives—people who have a degree of power in our society—should be made aware of what is going on and in some senses be made responsible for doing something about it. While most local councillors, MPs and MEPs would react sensitively, sympathetically and supportively to cases of maltreatment of domestics employed by visitors to this country, there is not the bond of voting.
I believe that those who have been resident in this country for a year should automatically qualify for the vote and should be able to take part in elections. They would then have a relationship with society and would be able to say that they have a local councillor, an MP or an MEP. The concept of everyone in a particular area having a vote is very important. It would link the oppressed domestic worker with the organs of power in our democratic state. It is important to build those links. I accept that the ideas I am expressing will not come to fruition in the near future but I put them forward as a means of building links between the dispossessed in our community and the people with power. We should be trying to find ways of helping ordinary people to live together without abusing each other.
Perhaps I may return to my main points. I stress the importance of television as a medium of communication. We should use television to express our society's standards of acceptable behaviour in terms of employment practice, to highlight the unacceptable and to explain to everyone in the community the difference between right and wrong. We need to build links between people who live in our society and the elected representatives. I hope that the Government will take action soon in regard to this sad reflection on British society.
8.40 p.m.
Lord Richard: My Lords, perhaps I may begin by thanking the noble Lord, Lord Hylton, for initiating the debate. The issue clearly needed airing and it needed open discussion. It also needs a response from the Government. We are extremely grateful to the noble Lord for launching the debate.
I do not think that anyone listening to the debate can fail to have been struck by the unanimity of view expressed by all speakers. There is a problem here which clearly needs redress. Inevitably, one looks to the Government for such redress. The individual stories we have heard—and there are many more of which noble Lords will be aware—are hair-raising. We have heard histories of abuse and ill-treatment. The picture which emerges is one of the extreme vulnerability of these domestic servants, lacking, as they do, status, independence and access to the remedies which are available to our own citizens and, indeed, to many people working in this country who are not citizens of the United Kingdom.

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The starting point for discussion of the problem must be the concession which the Government have made in respect of these domestic workers. I have with me a copy of Hansard dated 24th July of this year. On that date the noble Earl, Lord Ferrers, answered a Question put by the noble Lord, Lord Hylton, on the scope of the concession. He said:
"We very much regret that any cases of abuse and exploitation of overseas resident domestics should have occurred in this country, but we have concluded that in most cases the current arrangement benefits the servants themselves, who might otherwise lose their jobs if they were unable to come here with their employers. It is also important for the United Kingdom not to discourage those people with a substantial contribution to make to our prosperity who expect to be accompanied by their households when travelling here. We have therefore decided to continue the concession and allow domestic servants working as a member of their employer's household abroad to accompany or join their employer, or a member of his immediate family".
The noble Earl outlined certain controls which would be imposed:
"All domestic servants will be required to obtain entry clearance before coming here … the domestic servant must have been in continuous, paid employment with the employer abroad for at least the previous 12 months before coming … the minimum age is 17 years … information leaflets will be issued".—[Official Report, 27/7/90; cols. 1449–50.]
I should point out to the Government that those four controls seem to me to be minimal. I am sure that information leaflets are valuable, provided: first, that they reach the domestics; secondly, that the domestics are capable of reading them; and thirdly—most important of all—that domestics who find themselves in difficulty are capable of enforcing the remedies which are set out in the information leaflets.
The real problem is explicit in one sentence. It arises from the fact that we admit people who are in fact workers but that when we admit them we insist on pretending that they are coming into the country as visitors. That pretence is the basis of many of the difficulties which have been highlighted this evening. It is wrong in principle to treat people coming into this country to work as if they were visitors and then treat them as illegal entrants when they cease working and try to leave employment.
Perhaps I may briefly run through some of the difficulties to which this pretence gives rise. I begin with the position beforehand of a potential immigrant to this country; that is, the situation in which he or she is placed prior to arrival. The first stage of immigration control is obviously the acquisition of a visa. As I understand it, most people in this category come from countries where visas are required if citizens wish to visit the United Kingdom. The visas are issued for a specific purpose. This normally means that they are issued for a category defined by the immigration rules. However, as domestic workers do not fit into any of those categories, it seems that they are given "visit" visas. Moreover, if such people wish to work in this country they must obtain a work permit. These must be obtained prior to travelling to the United Kingdom in addition to any visa requirement.
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The late 1970s saw a phasing out of quotas as regards work permits for unskilled workers, including domestics. The quota was abolished at the end of 1979. Since that time, there are no work permits available for domestics coming into the UK. Therefore, there is no way—prima facie, at any rate—for a domestic wishing to work in this country in that capacity to obtain a work permit. That places her in a totally different capacity.
While there are provisions within the immigration rules for workers and for business (permit-free categories) and self-employed persons, there are no provisions for domestics except one which relates only to the domestics of members of staffs of diplomatic missions. Therefore, that is the basis —and, I suppose, it explains the need—for this systematic departure from the immigration rules to admit domestics and hence the so-called "concession" which, as I understand it, has been operating throughout the 1980s. That is what these people have to do before they come to the United Kingdom.
What happens to most domestics when they arrive in this country? They either receive six months' leave to enter with a prohibition on employment or they receive leave to enter for a longer period with employment restricted to a particular employer. That usually depends on whether the employer is coming for a short or longer period of time; in other words, they either come in as visitors or they come in bonded. What happens at the end of the six months? Applications for extension of leave to remain with the original employer who brought them in are normally granted. However, applications to change employers are routinely refused on the basis that no work permit was held on entry. Thus, such people are caught both ways. They cannot obtain a work permit because there is no quota for them, but if they come in as a visitor, at the end of the time allowed—although they have in fact been working and everyone knows that this is so—when they seek to gain alternative employment, their status reverts to that of a person who has been working in the country who is not entitled to do so and therefore the extension is refused.
It is true that there are no clear provisions in the rules which deal with changes in employment. However, as I understand it, the practice has been to allow applicants to change employment within the same category. A change of job within the same occupation and skills category is allowed and will usually be approved by the Department of Employment, but changes in category are not allowed. Therefore, the domestic servant finds herself in the situation where, first, she is in this country as a visitor; secondly, she is bonded to a particular family; thirdly, she cannot find alternative employment because of the immigration rules; and, fourthly, if she tries to leave, she is liable to be deported.
Other disadvantages are experienced by these people. Work permit holders are allowed to have their families with them provided that they can be maintained and accommodated without recourse to public funds. However, there are no such provisions for domestic workers. Noble Lords have already

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raised the point about the acquisition of permanent residence. Work permit holders qualify for settlement after four years in that capacity, but, again, there are no such provisions for domestic workers. So far as concerns other provisions, if a domestic servant runs away from her employment she is immediately liable to deportation. Moreover, unless she has been here for more than seven years, her appeal rights in deportation proceedings are extremely limited under the Immigration Act.
Clearly there is a problem. One should not overstate it; at the same time one should not understate it. It is a fact that a group of people in this country are being subjected to extreme abuse. It is not a situation about which we as a nation should be proud. The problem may not be large in terms of numbers; it is however large in terms of inequity and exploitation.
What can be done about the problem? There are two approaches. One, which has been aired by a number of noble Lords this evening, is to treat them as if they have a work permit; namely, let them move jobs within the same category, and after four years let them be able to claim residence. The other approach would be not to admit them on a concessionary basis but on a more regular basis and in their own right. This would avoid the problem of their coming to Britain and being bonded to one family. They would have an independent status and a legal status before actually coming here. I await the Government's response on this.
It may be that the cleaner, neater and quicker solution is perceived to be the first of those two alternatives; namely, that once in the country one should treat them as if they had a work permit and therefore have the same rights as other people who have work permits. My only qualification there is that it involves a secondary concession outside the scope of normal immigration rules. As a matter of principle, immigration policy should not be based on concessions but rather on properly understood and universally applied principles. But whichever approach the Government take, I would conclude by saying to the noble Lord who is to reply that clearly here is a problem which has been highlighted in this debate tonight. It needs to be looked at with sympathy by the Government; and action in respect of it is grossly overdue.
8.51 p.m.
Lord Reay: My Lords, I am grateful to the noble Lord, Lord Hylton, for the opportunity he has provided for us to debate what can be done to help people who come here from overseas as domestic workers. I should first like to say that the Government are just as concerned as he is and as other noble Lords are about the reports of mistreatment and exploitation of overseas domestic workers. I should like to pay tribute to the leading role the noble Lord has played in drawing attention to this problem.
In July we announced some changes aimed at reducing the kind of abuse described by the noble Lord and others, but with the permission of your
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Lordships I should like to return to this subject later. The arrangement under which some domestic workers come to this country is a concession outside our normal immigration arrangements, and it is one made in the interests of the workers themselves. It has been the clear and consistent policy of the Government to keep new primary immigration under tight control. As a key part of that control, work permits are issued by the Department of Employment only to those overseas nationals with high levels of skill and experience to come here to jobs which require those qualifications and which cannot be filled by people already here or elsewhere in the European Community. Thus, since 1980 no work permits have been issued for any type of domestic work.
However, the Government thought that it would be unreasonable for a domestic worker who had worked for an employer and formed part of his household abroad to be prevented from coming to the United Kingdom if the employer came here. This is both humanitarian and pragmatic. Domestic workers who were unable to accompany the household to the United Kingdom could well lose their jobs, their homes and their livelihoods. Looking at our national interest, if wealthy investors, skilled workers and others with the potential to benefit our economy were unable to be accompanied by their domestic staff they might not come here at all but take their money and skills to other countries only too keen to welcome them.
The concession operates in two ways. Domestic workers accompanying an employer who is visiting the United Kingdom can come here also as visitors and, like any other visitor, may stay no more than six months. Domestic workers accompanying an employer who comes here on a longer term or a permanent basis are admitted for 12 months in the first instance; but if their employer stays longer they may remain with him. After four years working here for the employer they become eligible to apply for settlement, at which point the restrictions and conditions on their future stay are removed.
We believe that the concession has generally worked well and that the great majority of domestic workers who have come here under these arrangements have been much helped by the concession. After all, they would otherwise have been excluded from the United Kingdom and might well have faced a most uncertain future. The relatively few cases where an overseas domestic worker has been badly treated in the United Kingdom rightly attract attention, but we do not believe that these in any way reflect the general treatment which overseas domestic workers receive.
The Government do not accept the suggestion that it is the concession itself which in some way creates the problems that have arisen. The conditions which apply to domestic workers are in practice just like those which apply to any other worker from overseas. The standard arrangement is for overseas workers to come here with work permits. These are issued only for specific jobs with named employers and are valid for a limited period only. Work permit holders have no entitlement to take any other work until they have

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been here in approved employment for four years and become eligible for settlement. In other words, the conditions for work permit holders are in line with those for overseas domestic workers who come here under the concession, and there would be no practical advantage at all in bringing domestic workers within the work permit arrangements.
Another suggestion which is made is that we should at least allow domestic workers to change employers here. The Government cannot accept that. Domestic workers are admitted in this exceptional way in order to safeguard their livelihoods. It was never the intention to give them unrestricted access to the United Kingdom job market. It would clearly be impracticable and, I would suggest, undesirable to allow only those domestic workers who charged their employers with mistreatment to move elsewhere. We would therefore effectively have to give all overseas domestic workers freedom to move to any job whenever he or she wanted to do so. This would be quite inconsistent with the whole reason for the concession, which is intended to enable domestic workers to stay with the employers for whom they have worked overseas. It would also give overseas domestic workers an unwarranted advantage over all other overseas workers, including work permit holders, who are not allowed to take other work here. This would not be consistent with the objective of a firm but fair immigration control, and I must tell your Lordships that the Government are not prepared to make such a change.
The noble Lord also implied that overseas domestic workers somehow have no rights when they come to the United Kingdom. That has sometimes been implied, but it is not the case. Everybody in the United Kingdom is entitled to the full protection of the criminal and civil law, regardless of their nationality or purpose of stay. Any domestic worker who is, for example, physically abused by his or her employer can and should contact the police, if necessary by dialling 999, as it is the job of the police to take action against criminal behaviour. Also, as a court case late last year showed—noble Lords have referred to this—a domestic worker who is ill treated may be able to bring civil proceedings in the United Kingdom courts.
Lord Hylton: My Lords, will the noble Lord be kind enough to give way? He rightly mentioned the court case. Would be not agree that that was a totally exceptional case? He must accept that it took five years to bring it, and I can tell him from my own knowledge, from correspondence and communication with the plaintiff's solicitor that no compensation has yet been received. I hope it will be received very shortly, but, leaving that case to one side, the point I endeavoured to make was that there are rights in theory but that they are not enforceable in practice.
Lord Reay: My Lords, I take the noble Lord's point. I shall be dealing with some of his specific points in a moment but I am just describing the basic situation as it exists. As I said, there is a possibility for civil proceedings to be taken.
Lord Donaldson of Kingsbridge: My Lords, may I intervene? I hope the noble Lord is going to tell us what he will do, since he cannot do what we have asked him to do. The legal situation now, as it exists, is simply not acceptable, and the noble Lord must know that.
Lord Reay: My Lords, as I said at the beginning, I shall come later to what else we are doing. Domestic workers from overseas who work for private employers and under the terms of their contracts of employment ordinarily work in Great Britain have the same employment protection rights as British employees. There is thus nothing in the suggestion that there is something peculiar about the position of domestic workers from overseas which excludes them from the rights and protection that we all take for granted.
I have taken some time to set out the position because, however much we deplore the incidents which have been described this evening and which have caused us all much concern, we need to recognise that there are no simple solutions. The Government are aware that overseas domestic workers can be vulnerable and we have been looking carefully at ways in which we can help to minimise the chances of ill-treatment. Indeed we are grateful for the advice and assistance that we have received from the noble Lord, Lord Hylton, and others with a close interest in the welfare of overseas domestic workers which they have contributed to this review.
As my noble friend Lord Ferrers announced in a Written Answer to the noble Lord, Lord Hylton, on 24th July this year, the Government have decided to continue the existing concession but will introduce tighter controls before the domestic worker comes here. Under the new arrangements, the admission of domestic workers will be limited to those aged 17 or over who have worked for the employer abroad for a substantial period: 12 months where the employer comes as a visitor and 24 months where the employer comes here for any other purpose. In all cases the domestic worker will be required to obtain entry clearance before setting out and the entry clearance officer will interview the domestic worker to satisfy himself about the arrangement. The entry clearance officer will also ensure that the domestic worker receives and understands an information leaflet explaining his or her rights. This leaflet will be available in a number of languages and its contents will also be explained orally to those domestic workers who cannot read.
Lord Donaldson of Kingsbridge: My Lords, will the leaflet be available before Christmas?
Lord Reay: My Lords, I shall come in a moment to the question which the noble Lord raised in his speech. A copy of the leaflet will also go to the employer, together with a covering letter explaining its purpose and emphasising the serious view that the Government take of the need to abide by the laws of this country.
We are currently preparing the new leaflet in consultation with the noble Lord, Lord Hylton, and

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the organisations which particularly represent domestic workers here. The noble Lord has himself made two suggestions, both of which we are happy to adopt. These are that the leaflet should be printed in a way which emphasises that domestic workers should keep their passports themselves in a safe place and that they may be entitled to at least one week's notice of dismissal. Secondly, the leaflet should explain how to obtain treatment from the National Health Service.
We hope that the leaflet can be ready and that we can introduce these new arrangements early in the new year. This should ensure that the domestic workers who come here know where to turn for help when in need and both they and their employers will be quite clear that they have a right to protection under the law of this country.
I was asked some questions which I have not covered so I wish to make a few additional remarks. The noble Lord, Lord Hylton, pointed his finger at deportation, to which a domestic worker who leaves his employer may find himself or herself exposed. It is an essential part of our immigration control that an overseas national can stay here normally only by qualifying under the immigration rules to do so. There will be cases where exceptional treatment is justified but these will be where there are the most compelling, compassionate circumstances. We cannot extend such treatment to whole groups.
We cannot offer domestic workers any guarantees that they will not be deported if the basis for their stay comes to an end. But each case will be considered carefully and compassionately before any enforcement action is taken.
The question of contract was raised by the noble Lords, Lord Hylton, Lord Pitt and others. The Government believe that the terms and conditions of employment are matters to be agreed between employers and employees without the interference of government. Legislation therefore does not set hours of work or levels of pay and the Government would not want to impose terms of contract for this group of people.
The question of spot checks was raised. We fear that to institute something similar would involve the creation of a bureaucracy which would be unlikely to be effective in most cases, given that the majority of those who come here are visitors. I might also point out that in this country domestic employment is excluded from the coverage of the Health and Safety at Work etc. Act 1974 because of the practical problems of enforcement and the invasion of privacy if inspectors were empowered to go into private households. The same would apply in this case.
The question of an amnesty was raised. We have no plans to grant a general amnesty, but any case of a domestic worker here who is an overstayer or an illegal entrant is carefully considered on its individual merits before action is taken either to deport or remove him or her.
I answered the question as to when the leaflet would be issued. We are at present considering the detailed comments we have received on it. The latest of these
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was sent to us by the Campaign for Justice for Overseas Domestic Workers only on 13th November. My honourable friend the Parliamentary Under-Secretary of State at the Home Office will write to the noble Lord, Lord Hylton, enclosing a final copy of the leaflet as soon as possible.
The noble Lord, Lord Donaldson, asked me whether the leaflet could go to all those who are already here. I am afraid that we do not consider this to be practicable since most domestic workers enter for only a short time. They come in on a visit with their employers. However, we shall consider issuing leaflets to all those who apply for an extension of their stay here.
Lord Donaldson of Kingsbridge: My Lords, if it is a matter of a 20p stamp, it seems to me entirely unreasonable that my request should not be met.
Lord Reay: My Lords, I do not believe it has anything to do with the stamp. Large numbers of people in this category who come under this concession come for short visits. That is the difficulty.
Lord Donaldson of Kingsbridge: My Lords, I asked the noble Lord either to confirm or deny the figure of 3,000. That is a guess but I would be prepared to pay for 3,000 stamps myself. Let us talk the same language.
Lord Reay: My Lords, as I have said, I do not believe this has anything to do with the matter of postage stamps. However, I am afraid that I cannot confirm the figure that the noble Lord has given as I do not have the information.
Lord Donaldson of Kingsbridge: My Lords, will the Minister please find out what the figure is and then write to me? Each of these persons has been dealt with by the authorities. Therefore the authorities must have a record. I do not believe for one moment that this information could not be found in two hours.
Lord Reay: My Lords, I shall be happy to look into the matter to see whether I can find the figure that the noble Lord asks for. However, I cannot give him an assurance that I shall be able to come up with the figure although I shall certainly look for it.
No doubt I have been asked other questions, and I shall reply to them in writing. I am happy to see that the noble Earl, Lord Longford, has just returned to the Chamber. I can assure the noble Earl that I shall be happy to draw to the attention of my right honourable friend the new Secretary of State the feelings that have been expressed on this matter and the proposals that have been made in the debate this evening.
The Earl of Longford: My Lords, before the noble Lord sits down, I hope I may make one point. Did the Minister mean that he was going to draw the attention of his right honourable friend to the tremendous emotion that has been expressed in this debate and not just to the dry statements that have been made?
Lord Reay: My Lords, that is what I said I would do.
Baroness Seear: My Lords, before the noble Lord sits down, I hope he will clarify one point. He said that

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the pamphlet that is to be issued will make it clear that people can go to the police for redress if they feel they are being abused in some way. He said they would have their passports. I take it that would give them some form of security. However, if a domestic servant is unable to obtain other domestic employment after falling out with his existing employer, he will not be able to earn any money and he will have to return straight home. If he has his passport, he can go home under his own means rather than be deported; but all that means is he would have to pay his own fare rather than have his fare paid by the Government. What does a domestic servant gain from this measure? If he complains, he will be out of a job and he will not be able to get another job. That seems to me to be the great weakness of the measure. A servant cannot go elsewhere even if he has established that he has drawn
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a blank as it were with his existing employer. The only course open to such a servant is to go home. What good does that do?
Lord Reay: My Lords, the position is that such a worker is able to stay on in this country until the end of the period for which he has permission to remain. However, he may not take other employment.
Baroness Seear: My Lords, if a servant has lost his existing employment and cannot take other employment, how is he to live?
Lord Reay: My Lords, the position would vary from one case to another.

Adelphi Estate Bill
Brought from the Commons; read a first time, and referred to the Examiners.
House adjourned at ten minutes past nine o'clock.