Lords Sitting of 16 June 1992

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

Psychiatric Patients: Care in the Community
Lord Mottistone Lord Mottistone asked Her Majesty's Government:
How they will fulfil the requirement for the Secretary of State for Health to be satisfied that suitable accommodation and daytime occupation is available in time to provide for the thousands of psychiatric patients currently in the 43 hospitals which are expected to close during the next five years.
Baroness Trumpington: My Lords, as my noble friend Lady Cumberlege said on 8th June, our primary aim is not the closure of mental hospitals but the provision of better care for people with mental health problems. Ministers will not approve the closure of any mental hospital unless it can be demonstrated that adequate alternatives have been developed in the community; hence the care programme approach.
Lord Mottistone: My Lords, I thank my noble friend for that reply. But is she aware that in the 1980s the numbers of day centre places for the mentally ill increased from 5,000 to 7,000, an increase of 2,000? Is she further aware that in that same period some 25,000 beds were shut down in hospitals? Does she agree that, bearing in mind the great discrepancy, if 43 hospitals are closed in the next five years, it is extremely unlikely that the aims she mentioned in her Answer will be achieved?
Baroness Trumpington: My Lords, the figures quoted by my noble friend tell only part of the story. They relate only to long-stay beds. Approximately 40 per cent. of long-stay patients do not move out of National Health Service care. Total day care provision rose by 116 per cent. to 15,100 places in 1991.
Lord Ennals: My Lords, can the noble Baroness tell the House the procedure by which the Department of Health will decide whether the accommodation in the community is adequate? Bearing in mind the Statement made by her fellow Minister yesterday that local authorities will not know what funds are available until November, and bearing in mind also the great reluctance of private sector providers of accommodation to take the severely mentally ill, how will the department determine whether a hospital should be closed and whether it is satisfied with the accommodation that is provisionally made available by the local authorities?
Baroness Trumpington: My Lords, I believe I gave the answer to the last part of the noble Lord's question when I said that nobody will leave. Hospitals will not close until we are sure that adequate care is provided for those who come into the community. As well as retaining in-patient facilities in district general hospitals, small hospitals or psychiatric units as part of the care programme approach, there will be systematic arrangements for assessing the health care needs of patients who could potentially be treated in the community.
Lord Campbell of Croy: My Lords, the Government's intention underlying the full introduction next April of the new community care system is widely accepted. However, is my noble friend aware that there is considerable doubt whether the preparations and arrangements that are necessary will be completed in time in all the local authority areas?
Baroness Trumpington: My Lords, we do what we can to help. It is up to local authorities to do some of the work themselves.
Lord Winstanley: My Lords, does the noble Baroness agree that there will always be some mentally ill patients who will require long-stay hospital accommodation? Is she in a position to tell the House how many long-stay beds for the mentally ill will be retained and where they will be?
Baroness Trumpington: My Lords, I cannot answer the last part of the question because it depends on my original Answer concerning when the community day care or other care is provided. But the Government recognise that there will always be some mentally ill people who require long-term in-patient care and supervision. Facilities for them, usually in the form of small hostels or psychiatric units, will continue to be available as part of the range of mental health services in districts.
Baroness Masham of Ilton: My Lords, if the placements in the community break down some of those patients may end up in prison. What facilities are there for them in prison?
Baroness Trumpington: My Lords, if, for instance, police constables find someone who is mentally ill on the streets, under Section 136 of the Mental Health Act 1983 they have the power to remove that person to a place of safety. If they find a person in a public place who appears to be suffering from mental disorder and in immediate need of care and control, in his own interests and for the protection of others they would call in medical help.
Baroness Fisher of Rednal: My Lords, will the noble Baroness explain government policy for those severely ill mental patients whom we know will need constant hospital care? We would have more satisfaction if the Government would declare their policy for those people who will have difficulty with the care in the community proposal.
Baroness Trumpington: My Lords, with the greatest respect to the noble Baroness, I have just answered that question.
Lord Elton: My Lords, does my noble friend accept that the great majority of those who have long or medium term in-patient treatment become rapidly institutionalised and cannot be released successfully into any accommodation in the community without rehabilitation for the everyday mechanics of living in society? Are the Government prepared to give assistance to voluntary bodies providing such training?
Baroness Trumpington: My Lords, we already support, for instance, the National Schizophrenia Fellowship. A long time ago I had an opportunity to meet members of that body and appreciate the work that it does. The Government give it £91,000 per annum. I am well aware of the number of projects undertaken by the National Schizophrenia Fellowship. Other organisations also receive support from the Government.
Baroness Seear: My Lords, will the noble Baroness tell the House how many patients can be supported for a year on £91,000?
Baroness Trumpington: My Lords, I cannot do so without a pocket calculator.
Lord Carter: My Lords, is the Minister aware that the Government have consistently refused to implement Section 1 and other sections of the Disabled Persons (Services, Consultation and Representation) Act 1986? Section 1 gives the mentally ill patient the right to authorise a representative or an advocate when he is discharged from hospital. Mentally ill patients having been given such a right, does the Minister agree that its implementation would do a great deal to resolve the problem?
Baroness Trumpington: My Lords, the question goes a little away from the original Question on the Order Paper. However, with a little luck I have managed to find an answer for the noble Lord. Local authorities can ensure that there is access to advocacy schemes. The Government encourage them to do so and have issued guidelines.
Lord Mayhew: My Lords, does not the Minister believe that before a decision is taken on the number of hospitals to be closed, a careful estimate should be made of the number of seriously mentally ill people requiring long-term treatment?
Baroness Trumpington: My Lords, although the number of long-term mental illness beds is falling steadily at an average rate of 2,500 per year, that reduction is offset by a substantial increase in community services. I can say no more except that hospitals will not close unless there is adequate community care for patients.
Lord Skelmersdale: My Lords, my noble friend stated that a grant of £91,000 is given by the Government to the National Schizophrenia Fellowship. Is it not a fact that a great deal more money is given to MIND every year?
Baroness Trumpington: My Lords, that is indeed a fact.
Lord Thurlow: My Lords, has any mental hospital not been closed as a result of evidence that there are insufficient facilities in the community?
Baroness Trumpington: My Lords, no. However, if the noble Lord knows of any such case perhaps he will let me know and the department will be delighted to consider it.

Overseas Aid: Size of Programme
2.48 p.m.
Baroness David Baroness David asked Her Majesty's Governmant:
Whether, in view of the link between poverty and environmental degradation in the developing world, highlighted by the Rio summit, they will increase the United Kingdom's overseas aid programme as a matter of urgency.
The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey): My Lords, we already have a substantial aid programme which is planned to grow in real terms to £1,975 million by 1994–95. Our aid will increasingly address key issues for sustainable development.
Baroness David: My Lords, I thank the Minister for her reply. It is good to have her back to answer questions on overseas development. Effective action to protect the environment and to promote and sustain economic development will require greater financial commitment from the richer industrialised nations. Our aid programme has fallen in real terms in the past 10 years. Will the Minister indicate when Her Majesty's Government will take definite steps towards achieving the UN target of 0.7 per cent.? Alternatively, will they give some indication of steps that could be taken on the way? Could we reach a higher percentage by a certain year? We should then have some factors on which to judge what the Government are doing.
Baroness Chalker of Wallasey: My Lords, the aid programme has grown 8 per cent. in real terms since 1987–88. We are now receiving from it better value for money than we ever have before. We are averaging 0.3 per cent. over the past five years. As I announced in Rio, the figure for 1991, which is shortly to be published by DAC, is about 0.32 per cent. or perhaps more. We have to make sure that with an aid programme that grows in real terms—though it may not be growing as fast as the noble Baroness would like—we receive the very best value from it. With other partners, that is exactly what we are concentrating on. One cannot solve those problems simply by spending more money. The receiving government must also have the ability to utilise that money properly so that none is wasted.
Lord Boyd-Carpenter: My Lords, is my noble friend aware that the most useful direction in which that aid can be pointed is towards enabling the third world to check the growth in population?
Baroness Chalker of Wallasey: My Lords, my noble friend is right. For that reason I have during the past two years increased by 50 per cent. the grant to the United Nations FPA for population planning.
Lord Ennals: My Lords, while accepting that the quality of the aid programme is good, the Question asked when the Government intend to reach the accepted target of 0.7 per cent. Can the Minister answer that Question? Is it not right that the developing countries, which look to Britain for a lead, should know when the Government will reach a figure that is half that promised by a previous British Government?
Baroness Chalker of Wallasey: My Lords, first, I wish to thank the noble Lord, Lord Ennals, for the part that he played in Rio in leading the non-governmental organisations as part of the British delegation. I am most grateful to him. We have not and shall not set the timetable as other nations have, simply because it is not realistic to do so. We cannot see beyond the next three years as regards public expenditure planning, as the noble Lord knows only too well. Members of your Lordships' House and everyone involved in the field have my assurance that we shall work in the right direction. That is why the language, which we negotiated in partnership with many other nations and on which we achieved a consensus on Saturday in Rio, is working towards the target but without set dates.
Lord Brabazon of Tara: My Lords, does my noble friend agree that one of the important subjects discussed at Rio was biodiversity? Can she tell the House what proposals the Government have in that respect?
Baroness Chalker of Wallasey: My Lords, my noble friend is right and we are spending some £10.9 million on 42 different biodiversity projects. That is the way in which the money has gone towards what we term the Agenda 21 items. It is an important part of the shift away from major infrastructure to people- and locally-orientated projects.
Lord Judd: My Lords, does the Minister agree that the Government have committed themselves to Agenda 21? The target of 0.7 per cent. GNP is not separate but it is the bill for Agenda 21. Surely if we will the ends we must will the means. Will the Minister assure the House that, when Britain takes on the presidency of the EC, it will lead a move in Europe to ensure that the bill is met for the programme to which we are now committed?
Baroness Chalker of Wallasey: My Lords, the noble Lord, Lord Judd, knows full well that Agenda 21, which is an 800-page document of immense complexity, is literally an agenda for the 21st century. The issue of resources for Agenda 21 items was long discussed. The wording in the final communique stated that we as nations agreed to augment our aid programmes in order to reach the target as soon as possible and to ensure a prompt and effective implementation of Agenda 21. As my right honourable friend the Prime Minister said in another
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place yesterday, and as my noble friend the Leader of the House repeated in this House, Britain will play its full part in the implementation of Agenda 21 items and in the European context too. I can assure the noble Lord, Lord Judd, that I shall be leading the charge in the coming six months.
Lord Prentice: My Lords, my noble friend has spoken against timetabling the target and has reminded us that we cannot sensibly look more than three years ahead. However, in the context of the three-year spending programme which she will be discussing with colleagues during the next three months, will she point out to her Treasury colleagues that this year as a result of Rio and the developments in Africa, including the severe drought, the provision for her programme will receive much more public attention than usual and is of particular sensitivity?
Baroness Chalker of Wallasey: My Lords, no one could be more aware than I of the sensitivity of my programme's future spending. The £100 million additional money which when at Rio the Prime Minister announced we shall be spending towards the global environment facility replenishment and the other commitments that we have made. In particular, to lead the thinking and initiatives which are necessary to implement Agenda 21 will help people to understand the critical importance of the outcome of Rio not only for the next two or three generations but for ever.
Baroness Seear: My Lords, is any of the additional money being earmarked for the improved education of women in developing countries? I know that the Minister agrees that that is a proven method of achieving voluntary control over excess population.
Baroness Chalker of Wallasey: My Lords, the noble Baroness is right. We must ensure that the resources in Agenda 21 are targeted in particular to that area. I spent a great deal of yesterday in New York with UNICEF discussing how women can be enabled to play a greater part in their development and in planning to have their children when they want them. We have also made progress on that matter in other areas and I shall be telling the noble Baroness about that à deux.
Lord Chalfont: My Lords, I was in Brazil during the Rio conference and was somewhat depressed by the attitudes adopted there. Does the Minister accept that in making more generous aid available her task would be easier if that generosity were recognised and not regarded as the discharge of some debt from the industrialised world to the developing world?
Baroness Chalker of Wallasey: My Lords, the noble Lord is right. However, during the whole of the Rio conference I was interested to note the gratitude expressed to me for the targeting and the better value for money of the British aid programme in particular. We do not throw money at countries to spend on their needs. We work with them in partnership to try to improve their abilities; in other words, to help them to

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help themselves. I am sure that that is the right way to go and I know that some of those countries are most grateful.
Lord Mackie of Benshie: My Lords, is the Minister aware that many of us admire greatly her efforts in this field and wish her luck in her struggle with her more conservative colleagues in the Government?
Baroness Chalker of Wallasey: My Lords, I thank the noble Lord for his kind comment. I merely tell him that I am perfectly able to fight my corner, as I believe he already knows.

Armed Forces: Awards
2.57 p.m.
Lord Carver Lord Carver asked Her Majesty's Government:
Whether they will review the system of awards to members of the armed forces for gallantry and for distinguished service.
The Parliamentary Under-Secretary of State, Ministry of Defence (Viscount Cranborne): My Lords, the Ministry of Defence keeps under review the system of awards to members of the armed forces for gallantry and for distinguished service. That position remains the same.
Lord Carver: My Lords, I thank the Minister for his informative Answer. Can he assure the House that a review body will do its best to recommend a method of removing the anomalies in the present system as regards differences between the three armed services, the different ranks, the sexes, the awards which can be made posthumously and those which cannot, and those which are gained for gallantry and those for distinguished service?
Viscount Cranborne: My Lords, we should be grateful to the noble and gallant Lord for giving the House the opportunity to air this important Question. As noble Lords will be aware, we now live in a classless society. I was not aware that that piece of news had not until now been appreciated by your Lordships. It is timely that the noble and gallant Lord should give the House an opportunity to comment. I assure him that his remarks will be closely noted in the Ministry of Defence, a Ministry of which he was such a distinguished ornament in the past. Any review that takes place will certainly take those matters into consideration.
Lord Mayhew: My Lords, since the noble Viscount referred to the routine review by the Ministry of Defence, are we to understand that the Prime Minister's statement that he intends to review all honours does not apply to the military? With reference to the noble Viscount's reply to the noble and gallant Lord, do we understand by his reference to the "classless society" that the Prime Minister is now contemplating ending the distinction between barons on the one hand and viscounts, earls and so on on the other?
Viscount Cranborne: My Lords, in my very junior capacity as a member of the Government, I am never as privy to those important matters as I should like to be. However, I assure noble Lords and the noble Lord, Lord Mayhew, in particular, that any review which takes place at a more general level will include the matters raised by the noble and gallant Lord.
Lord Mackie of Benshie: My Lords, will the noble Viscount please give an indication of the Government's thinking, apart from saying that we live in a classless society?
Viscount Cranborne: My Lords, it is fair to say that that phrase has become more current under the present Conservative regime than perhaps it was under the previous Labour regime.
Lord Chalfont: My Lords, is the noble Viscount aware that the position put forward by the noble and gallant Lord, Lord Carver, has considerable support within the armed forces? While there may be a reason for differences between men and women in the services and perhaps a reason for differences between awards for gallantry and distinguished service, there are no longer seen to be any reasonable grounds for distinction between ranks in the services as regards awards for gallantry and distinguished service? Will the Ministry bear that in mind when it continues its review?
Viscount Cranborne: My Lords, with the greatest pleasure, I give the assurance which the noble Lord seeks.
Lord Jenkins of Putney: My Lords, I congratulate the noble Viscount on his ability to get a laugh. I assure him that it is not the way he tells them; it is what he says.
Viscount Cranborne: My Lords, I am grateful to the noble Lord.

Durham Coal Mines: Future
3.4 p.m.
Lord Dormand of Easington Lord Dormand of Easington asked Her Majesty's Government:
What representations they have made to British Coal about the possible closure of the remaining coal mines in County Durham.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Baroness Denton of Wakefield): My Lords, decisions on closures affecting individual collieries are, as the noble Lord knows, a matter for British Coal. The Government do not seek to intervene.
Lord Dormand of Easington: My Lords, is the Minister aware that that is not only a very disappointing Answer; it is also an extremely complacent Answer? Is she aware that Seaham Vane Tempest and Easington collieries are facing imminent closure with a loss of 2,800 jobs, which will be added to the 2,000 which have been lost in the same area because of the recent closure of two other pits?

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Is she aware further that both those pits had been meeting the objectives laid down by British Coal, even though the targets had been changed frequently—a classic case of moving the goalposts? Why is it that the German coal industry can receive a subsidy of £38 per tonne while the industry in this country is refused any subsidy at all? Such subsidies could be crucial in ensuring the survival of the Durham pits?
Baroness Denton of Wakefield: My Lords, the Answer was not meant to be complacent. It was factual. The Government cannot be accused of not helping the coal industry when at present they continue to invest about £1 million per working day to make it competitive. There is no complacency as regards the Durham area where already British Coal enterprise has committed well over £7 million towards financing small and medium sized businesses. As a result, some 2,440 people are currently employed in businesses assisted by British Coal.
Lord Mason of Barnsley: My Lords, is the Minister not aware that the Durham and South Yorkshire coalfields have been waiting over 18 months for the RECHAR moneys allocated to them from the European Regional Development Fund but blocked by the DTI and the Treasury? Four weeks ago the Minister informed this House that the RECHAR moneys would be paid soon; indeed, she stressed that they would be paid very soon. The mining communities are waiting for that cash. Where is it?
Baroness Denton of Wakefield: My Lords, we were pleased that after considerable dispute and delay, the European Commission approved the 11 RECHAR programmes which are worth £124 million. It is a complex subject. Discussions on the transitional period continue: the matter will be resolved just as soon as possible. From lst April 1993, local authorities will receive supplementary credit approvals to match in full the RDF funded part of their expenditure.
Lord Dean of Beswick: My Lords, my noble friend Lord Dormand mentioned subsidies for imported coal. Is the Minister aware that last year 14 million tonnes of coal were imported into this country, the equivalent, for the mining industry, of 14,000 jobs? Is it not grossly unfair that this country should have to subsidise, through the EC, German coal so that German miners instead of British miners may be employed? Will the Minister take up that matter as soon as possible with her Cabinet colleagues and put an end to the privileged position of the German miners at the expense of the miners in this country?
Baroness Denton of Wakefield: My Lords, we are aware of the issue of the subsidised coal industry in Germany. I assure the noble Lord that only 1 per cent. of imported coal comes from Germany. However, during our presidency we shall be concerned with that matter. I should point out that if British industry had to pay over the odds for electricity supplies arising from high cost coal, it would be less competitive and a greater number of jobs would be at risk.
The Earl of Shrewsbury: My Lords, does my noble friend agree that the forthcoming privatisation of British Coal will not only improve the competitive edge of the British coal industry, but will also mean lower imports of foreign coal, cheaper prices and, therefore, a better deal for the consumer?
Baroness Denton of Wakefield: My Lords, I agree wholeheartedly and confirm that it will mean also a better deal for industry and the economy.
Lord Clinton-Davis: My Lords, will the noble Baroness indicate whether the Government accept or reject the advice of their own merchant bankers, Rothschild, who advised the Secretary of State to intervene directly in the negotiations between British Coal and the generators to ensure that British Coal obtains high take, long-term contracts which will enable it to invest in clean coal technologies?
Baroness Denton of Wakefield: My Lords, the Government listen to advice but they make their own decisions. They will bear in mind the advice they receive.

Business
Lord Hesketh: My Lords, at a convenient moment after 3.30 p.m. 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 National Economic Development Council and Office.

Judicial Pensions and Retirement Bill [H.L.]
3.9 p.m.
The Lord Chancellor (Lord Mackay of Clashfern): My Lords, I beg to move that this Bill be now read a second time. Perhaps I may say how much I am looking forward to the maiden speech of my noble and learned friend Lord Taylor of Gosforth.
This afternoon we are debating the Judicial Pensions and Retirement Bill, which I introduced into this House on 4th June. The Bill makes new arrangements in respect of judicial pensions and amends the law relating to the date on which certain judicial office holders are required to retire.
It may be helpful if I say something about the history of the Bill and the context of some of its main provisions. I start with pensions. It is nearly two-and-a-half years since I announced to this House a review of the judicial pensions schemes. Some of your Lordships may remember the occasion: it was on 5th February 1990 during the Committee stage of the Courts and Legal Services Bill. I explained to the House then that the judicial pension schemes were extremely complicated and carried a good number of difficulties for those who have to try to make out their rights under them. I said that the situation called for a radical examination of pension arrangements and promised to conduct such an examination. What I wished to do, if I may put it in a nutshell, was to

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rationalise the current, somewhat haphazard arrangements for judicial pensions and bring those arrangements more into line with the standards which now apply to all other pension schemes in the public and private sectors, if they are to be allowed privileged status under the Income and Corporation Taxes Act 1988. In devising the new scheme, I proceeded on the assumption that in general any new arrangements should not prejudice the pension position of those already holding judicial office.
Before turning to the details let me say that I am aware that the pension on offer is an important part of the remuneration package which a prospective judge will wish to consider when deciding whether or not to take up a judicial appointment. It is in the interests of all of us in a free society that our judges should be men and women of the highest calibre, able and willing to carry out the heavy public duties which we expect of them. It is right, therefore, that the pension Parliament provides to our judges should be sufficiently substantial to attract, or at least not deter, those candidates best fitted to serve. At the same time, as a member of the Government, I am mindful that judicial pensions are paid from the public purse. The proposals which we published for consultation in December 1990, and the provisions of the Bill before your Lordships today, are the result of careful consideration as to how best to balance those potentially conflicting demands.
Why, therefore, did I say a few moments ago that "radical examination" of the current arrangements was necessary? I said it because I did not think that anything less would suffice to correct the anomalies and inflexibilities of the current schemes. That those anomalies and inflexibilities exist is hardly surprising. The judicial pension schemes have grown up piecemeal and emanate from a time when pension arrangements were less sophisticated than they are today.
Let me mention, in broad terms, just some of the anomalies and inflexibilities. First, the rules on aggregation. As many of your Lordships will know, under the current rules a holder of a judicial office who subsequently takes a different judicial office may aggregate his service in both offices for pension purposes but, in certain cases, only on the salary and pension terms of the lower paid office. For example, a circuit judge promoted to the High Court Bench may opt, at the time of the compulsory retirement age of 75 of that office, or if he retires earlier, to take either a pension based solely on his service as a High Court judge—in which case he can do it by reference to the High Court judge's salary—or one based on the current (that is, at the time of retirement) pension of a circuit judge, but in that case with aggregation of the time of service in both offices. In effect, a person who takes the pension of the second office loses the benefit of the years of service in the first office. That cannot be right. It is most unfair to those who, having served conspicuously well in their first judicial post, move to a more senior appointment; and it could act as a disincentive to promotion in that situation.
Another anomaly which currently gives rise to
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anxiety relates to the different accrual periods which apply without any rational basis to the different pension schemes now in existence. For instance, with regard to England and Wales, High Court judges, circuit judges and chairmen of industrial tribunals have 15-year accrual periods. Stipendiary magistrates, district judges and members of the Lands Tribunal, on the other hand, have a 20-year accrual period. The clock ticks even more slowly for immigration adjudicators where the accrual period is 40 years. When one looks north of the Border and across the Irish Sea, the disparities are perhaps even more marked. Scottish sheriffs have a 20-year span compared with the 15-year span enjoyed by their English counterparts, the circuit judges—an anomaly which I am aware has caused considerable resentment north of the Border and which is not easy to explain. District judges and Supreme Court Masters in Northern Ireland have a 30-year span compared with the 20-year span of their English counterparts. To my mind those differences simply cannot be justified.
A further anomaly exists by reason of the fact that certain judicial officers in schemes with a 20-year accrual span have to serve for two years before qualifying for a pension on grounds of ill-health. No minimum period of service is, however, required of office-holders in 15-year schemes.
The Bill corrects those anomalies. It creates a single, unified pension scheme for all the judicial officers in the United Kingdom listed in Schedule 1 to the Bill. The Lord Chancellor and the Secretary of State for Scotland are given power in Clause 1(6) to add offices to that list. The new scheme will apply to new entrants to the judiciary, and to those in one of the existing schemes who elect to join the new scheme or who are promoted to another judicial office, which is covered by a different scheme, after the new arrangements come into force.
The scheme will provide for their existing pension rights to be credited to the new pension arrangements: that is, Clause 12. Judicial officers under the new scheme will have their pensions calculated according to their actual service, in years and days. That provision is in Clause 3(3) (c). That will alleviate the problems arising from the current aggregation rules which I mentioned a moment ago. It removes also the current unfairness which can arise as a result of some of the schemes calculating pension by reference to the "completed year of service". As matters stand now, if a judge is obliged to retire on his birthday which happens unfortunately to fall a few days short of a completed year of office, that part of his service does not enhance the rate of pension which he will enjoy. Under the provisions of the Bill he will be entitled to count all the time he has served.
The Bill provides in Clause 3 for a single accrual rate of 20 years. That, I know, has been the subject of a certain amount of adverse comment. That period is not, however, an arbitrary one. It is the limit fixed by the Finance Act 1987 as the minimum accrual period for a tax approved pension scheme to provide maximum pension benefits; and, as I said a few moments ago, it is the Government's intention that

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the new judicial scheme should, for tax purposes, be brought more into line with the pension arrangements applicable to other members of society.
While on the subject of tax, let me say a few words in regard to capping. The Finance Act 1989 requires the salary on which benefits from tax approved schemes are calculated to be capped at a specific level. That level increases annually in line with price inflation. The current level for the 1992–93 tax year is £75,000. All private sector schemes were automatically capped by the 1989 Finance Act for new entrants from the time that Act came into force—for most people that was on or after 1st June 1989. The same result was achieved for members of public sector schemes by amending regulations. By July 1989, the only group of pension scheme members who were excluded from the cap were the judiciary. The judicial pension schemes can be changed only by primary legislation, which is what we are doing in this Bill. The result of that is this: those members of the judiciary appointed between July 1989 and the date the Bill comes into force have an advantage over other new members of pension schemes because their potential pension benefits have not been subject to the cap. They will continue to benefit from that position, as will those in a judicial pension scheme before 1st June 1989, unless and until the new arrangements apply to them on one of the routes that I described earlier.
It is because the salaries of some members of the judiciary exceed the cap that the Government have decided that judges' salaries above the cap will be pensionable under a top-up scheme. That will come into effect automatically. The benefits from the scheme will be modelled, on the main scheme but the top-up scheme will not àttract tax relief. As against that, and unlike the position under the main scheme, judges will not have to pay contributions for spouses' and children's benefits in respect of that part of their salary in the top-up scheme. Uniquely also for a scheme as beneficial as this one, as happens at present, benefits from previous pension arrangements will not affect those payable under the judicial pension scheme —that includes pensions payable under private self-employed schemes.
I would suggest that the new scheme is appropriate for the judges. The full pension, payable after 20 years' service, will be half the salary paid to the judge in whichever period of 12 months during the previous three years gives the best result. For service of less than 20 years, the pension will be one-fortieth of the salary paid to the judge (in whichever period of 12 months during the previous three years gives the best result) multiplied by the length of the judge's service in years and, of course, allowing for part years, as I explained. In addition, judges will be entitled to a lump sum of two-and-a-quarter times the annual rate of their pension. At present the lump sum is twice the rate of the pension. As now, there will be provision for widow's and children's pensions. There will be provision also for the payment of a death gratuity of one-and-a-half times the amount of the judge's pensionable pay. Any judge who has served for five years will be entitled to an immediate pension at the age of 65. Judges between the ages of 60 and 65 will be
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able to take early retirement with an immediate pension which is actuarially reduced. These limits do not apply to ill-health retirement, the payment of a death gratuity or the payment of spouses' and children's pensions. All these matters are covered in Part I of the Bill. A judge's right to take a preserved pension payable at 65 after only two years' service is unaffected by the Bill.
Before I leave the pension provisions of the Bill, I should just mention Clause 29(3) and (4). There the Bill gives the Lord Chancellor or the Secretary of State for Scotland, as appropriate, power to make regulations or orders. The Bill also gives the Minister power to make transitional, consequential, supplementary or incidental provisions or savings in relation to those regulations or orders. This power includes, where necessary, power to modify the operation of this Bill or any other enactment. But—and I must stress this—this power is a very limited one; it can be used only in connection with transitional, consequential, supplementary or incidental provisions. Given the complexity, diversity and existence of anomalies in the existing schemes, the House will appreciate the need for this type of provision as the matters are worked out.
Let me turn now to retirement which is the other subject dealt within the Bill. This is covered in Clauses 25 to 27. As with pensions, part of my aim here is to introduce consistency. At the moment, judges and judicial officers have a variety of retirement dates. Some of these are already below 70—such dates will not be affected by this Bill—others are at or above 70. Some relate to the attainment of a particular age, others to the completion of the year of service following a particular birthday. The retirement age for circuit judges in England and Wales, sheriffs in Scotland and county court judges in Northern Ireland, for instance, is the end of the year of service in which they reach 72 whereas that for High Court, court of session and other senior judges is 75; and for some appointments, particularly in tribunals, there is currently no statutory retirement age at all.
I have discussed these matters with some of my senior colleagues and we consider that a retirement age of 70 would be more appropriate to modern conditions. I therefore consulted earlier this year on a new and general retirement age of 70. I am pleased to say that the consultations indicated that there was general support for this. Clauses 25 to 27 and their accompanying schedules accordingly provide for a general retirement date at the age of 70. I thought that it was appropriate to deal with any proposal to change the retirement age in conjunction with the proposals about pensions so that the full effect could be seen at once. Those clauses also provide that persons holding judicial office when the new retirement provisions come into force, will be able to keep this retirement age. This will also apply when someone subsequently moves from one full-time office to another. For example, if a circuit judge is subsequently appointed to the High Court Bench, he will retain his present retirement age of the end of the year of service in which he reaches 72.

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At present there are powers to extend service in some, but not all, judicial offices beyond the retirement date otherwise applicable. The application of these powers, where they exist, has been helpful in providing flexibility to meet the needs of the courts and in ensuring that the ability and expertise of experienced judges need not be lost prematurely if that is in the public interest. I consider it appropriate to retain such flexibility and, with the introduction of a new retirement age of 70, to provide for the possibility, consistently for all offices, of enabling service to be continued in the public interest. The Bill accordingly provides that service may be continued after the age of 70, but only if the Lord Chancellor or Secretary of State for Scotland, as the case may be, considers that desirable in the public interest, and then only for periods of no more than a year at a time up to, but not beyond, the judge's 75th birthday. I must emphasise that I believe that this power would be used sparingly and applied only where it was clearly in the public interest to do so, taking careful account of all the relevant considerations including in particular such things as the health of the judicial office holder in question.
Under current provisions, Lords of Appeal and other judges who have retired from full-time service, may be invited from time to time to serve in retirement on a part-time basis. I am very grateful for the help which has been provided in this way by Members of this House and the other judges concerned. They have made an important contribution to the administration of justice. But I believe that it is no longer fair to expect them to be available indefinitely in this way and so the Bill provides for the overriding limit of 75 to apply in these circumstances also.
Any retirement age is of course a matter for judgment. Conflicting considerations have to be balanced to achieve what the person seeking to make the judgment believes to be right, both in the interests of the judges and in the interests of the public. On the one hand, the increasing burdens of judicial office must be acknowledged. On the other hand, although the current retirement ages for our judiciary are higher than those for most other professional people, we also have to recognise that judges are appointed relatively late in life. They are usually drawn from those who have already established themselves in a successful career in the law, and their years of experience are part of the necessary qualifications for the position. Accordingly, they bring with them a maturity of judgement which I believe is essential for judicial office.
The point has been made by some members of the judiciary that a retirement age of 70, however desirable in itself, would result in difficulties in relation to appointments. Well, I understand the point but I do not share the anxiety. We all know from recent experience of opinion polls that what people say they are going to do and what they actually do may not always absolutely coincide. Three score years and ten seems to me to be an appropriate general age for retirement and that is the age on which I believe we should settle. I commend this Bill to the House.
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Moved, That the Bill be now read a second time. —(The Lord Chancellor.)
3.27 p.m.
Lord Mishcon: My Lords, the House will be grateful, as always, to the noble and learned Lord for a lucid exposition of this Bill which deals with a somewhat esoteric subject. Before I try to deal most unsuccessfully with that esoteric subject, I join with him in saying how much from these Benches, as I know from all Benches, we are looking forward to the maiden speech of the noble and learned Lord the Lord Chief Justice whom we are delighted to have in our ranks.
I believe that it has been said wisely that a nation is judged by the standard and excellence of its judges. I hope that the same does not apply to a judgment of this nation as regards Treasury Ministers and their officials, honourable men though undoubtedly they are. I say unashamedly that if I see a conflict between the Treasury and the judges, and I believe that it is going to conflict with the aim which I know your Lordships and the nation will have of having in its judiciary the most excellent recruits that it can, I am on the side of the judges.
Perhaps I may deal with the situation of special provision. The noble and learned Lord very fairly said that, where there were anachronisms, conflicts and illogicalities which could be ironed out in legislation, they should be removed in a statute. That is absolutely right.
However, I did not bend towards the noble and learned Lord with the utmost alacrity when he seemed to suggest that judicial pensions ought to be of the same kind and meet the same terms and conditions as pensions for other folk. For many, many years the principle has been recognised that there has to be special provision in regard to the pensions of judges for the very obvious reason that they come to their appointments in mid-career. They do not have 40 years of continuous service as other people might have in other occupations. Therefore, the question of conformity worries me, and it will worry me considerably if I and your Lordships find that it will deter certain people whom we would love to see as judges from accepting recruitment when that honour is offered to them.
I should say at once that I have no quarrel at all with the reduction of the retirement age to mandatory retirement at 70. I believe that the Bar Council has expressed the view that it would like the mandatory retirement age to be reduced to 65 eventually. There is merit in the idea of reducing the retirement age both from the public point of view and from the point of view of experience. There is a time when that heavy load should be laid down.
However, I am not saying that I necessarily bow to the worship of youth for the sake of youth. I am looking—as I know the noble and learned Lord the Lord Chancellor would always look—at the suitability of making appointments at too young an age. If one starts thinking in terms of the age of 45 and says to somebody of 45, "Please give up your career just as it is about to reach its zenith and look forward to

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working for only 15 years before you can retire on full pension", one can understand the attraction. However, to say, "I am afraid that you will have to stay on until 65 before you can retire in that way", does not seem to me to be a sensible way of achieving fairly early retirements or of offering inducements to those of that age in that position.
I have said that youth for the sake of youth does not seem a very sound maxim to follow. Those of us who have been in the law and who have loved it for many years can no doubt think of examples of brilliant advocates who made awfully bad judges and of brilliant lawyers who made stuttering and stammering judges and who extended cases over an absolutely unconscionable period of time. There must be a certain temperament that makes for suitable judges. There must be experience. Perhaps those about to be appointed could take an acting judgeship for a time—a temporary position—while their abilities and temperaments could be weighed up by those who have the grave responsibility of appointing them as judges.
I dare say—even in your Lordships' midst—that some people may have been appointed even to the highest tribunal in the land, which is part of your Lordships' House, who have seemed to have a quite unsuitable temperament, being aggressive, impatient or irascible. I am certainly not speaking of the present Members of your Lordships' House who sit in a judicial capacity. I get very angry when judges are irascible towards young counsel. There was a case not so very long ago—I am told that it is not apocryphal—when a Law Lord peppered a leading counsel to such an extent that the man was literally reduced to a state of almost collapse. Having done that, the Law Lord looked at the junior counsel and said, "Now, have you any further observations to make?", to which the junior counsel very courageously replied, "Not without a helmet, my Lord". I tell that story not so much as a joke—although it is nice to see your Lordships smile occasionally in the midst of a serious debate like this—but because the question of a tried temperament and of experience must be taken into account. They are most important matters.
Does that make the increase in service from 15 to 20 years sensible? If we really want experience, should we not be thinking in terms of the average appointment being made to somebody in his or her early 50s? How does that fit in with having to have 20 years' service before the full pension can be earned? With respect, perhaps I may say that that is the Bill's first mistake. Indeed, I believe that I am in good company in thinking that it is a mistake because I believe that the Top Salaries Review Body would love to have the opportunity of expressing a second view. It has already expressed a first view on this topic.
Perhaps I may mention one other matter by way of a question that I should like to direct to the noble and learned Lord the Lord Chancellor. I am not sure of my ground here. I know that there was an anomaly about which retired circuit judges were very worried. Although I have not had a lot of time, I have been reading the Bill to see whether the point has been covered. I hope that the noble and learned Lord will forgive me if I make a bad point but that he will
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answer it if it happens to be a good point. Obviously circuit judges should be paid the pro rata rate for a circuit judge in the same way as a retired High Court judge is paid. I do not know whether the provision has been altered by the Bill, but I have been told that circuit judges are paid at the lesser rate—namely, at that of an assistant recorder, while a recorder is properly paid at the rate of a circuit judge. When submissions were made on behalf of the second rung of the judicial ladder, I am told that the Lord Chancellor's Department said that it recognised that that was an anomaly and that it should be corrected. However, here comes the Treasury again, because I am told that until recently—or until now—the Treasury has said that it will not agree to the anomaly being put right.
I am sure that many of the Bill's provisions are sensible and good in regard to its tidying-up process —a legislative duty which your Lordships will regard as very proper. However, when it comes to seeing whether everything is in order in this Bill, I know that your Lordships will want to look—as I have looked humbly—at one aim and that one aim alone. We have a high reputation in regard to our judges. We must keep it that way. We must ensure that recruitment is made easy and not difficult for the best men that we have in the profession.

The National Economic Development Council
3.40 p.m.
The Minister of State, Department of Transport (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 Chancellor of the Exchequer. The Statement is as follows:
"With permission, Madam Speaker, I should like to make a Statement. The National Economic Development Council and the National Economic Development Office were established in 1962. In the 1960s and 1970s they provided a helpful forum in which the overall economy and the performance of individual sectors could be discussed and debated. Much useful work was done and successive governments valued the role that NEDC played.
"But the era of corporatism is long passed. In the past decade, governments, not just in Britain but across the world, have pursued more market-oriented policies, the promotion of competition and the smooth functioning of market mechanisms. There have been radical changes to the structure of business and industry. The number of small firms and the self-employed has grown rapidly. Large parts of the former public sector have been privatised, and international markets are increasingly integrated.
"The British workforce has become more skilled and more specialised, with more flexible working practices and more varied career patterns. Trade

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union membership has declined, and in the private sector decentralised wage bargaining has become the norm rather than the exception.
"Against this background, it is clear that the NEDC no longer reflects the needs and realities of the British economy in the 1990s. Since its inception, the council has been dominated by producer interests. But its membership and structure cannot hope to represent fully the interests and views of the whole range of industry or the workforce. And, paradoxically, the continued existence of the NEDC in these changed circumstances may actually have inhibited, rather than encouraged, the development of direct contact on specific issues between the Government and trade unions and other employee associations.
"Accordingly, and after careful consideration, the Government have decided that the National Economic Development Council should now be abolished.
"The sector groups and working parties of the council will also be wound up. Over the years, they have made a valuable contribution, and some of the issues addressed by the council and these sub-groups will of course remain on the agenda. Those most closely concerned in the present range of NEDO's consultative activities may decide that they wish to continue to liaise with each other, but it will be for them to decide what is done, and how.
"The National Economic Development Office has served the council and the sector groups and working parties well. But with the end of the council, and the change in the way the Government intend to approach more detailed issues, the office itself will no longer have a role. Accordingly, its work will be wound down in an orderly fashion over the next six months. The office will close on 31st December 1992.
"It is the intention of my right honourable friend the President of the Board of Trade to offer employment to a small number of NEDO staff in his department. There may also be opportunities in other government departments. Those who do not secure employment in the Civil Service will be eligible for redundancy compensation by analogy with the usual Civil Service rules. There will be full consultation with staff and their representatives on the handling of redundancies and the applicable terms of existing redundancy procedure agreements will be fully honoured.
"I should like to make it clear that today's announcement is no reflection on the work done by the staff of the office or the sector groups and working parties. And I should like to add a particular note of thanks to Dr. Walter Eltis for his work as director general.
"The Government continue to attach particular importance to improving the effectiveness of our dialogue with industry. Indeed, in recent years we have consulted more frequently and with a wider range of interests than in the past on complex technical subjects. This is true both in the formulation of domestic policy and in the
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development of the UK's response to the increasing range of draft EC directives as the single market approaches. This partnership has served Britain well and it will continue. The Government will be alert to the interests of industry in developing policies across the range of its activities.
"My right honourable friend the President of the Board of Trade has already announced his intention to reshape some of his department on a more sectoral basis. He will be announcing details before the Summer Recess.
"The Government remain fully committed to maintaining a close dialogue with industry and with all other relevant interests. But I believe that this decision to bring the National Economic Development Council to an end is the right one. A close relationship between government and industry remains as essential as ever if we are to develop our policies to create in Britain a strong, dynamic and competitive economy. But the age of corporatism must be put firmly behind us."
My Lords, that concludes the Statement.
3.45 p.m.
Lord Peston: My Lords, I thank the noble Earl for repeating the Statement made in another place by his right honourable friend the Chancellor of the Exchequer. I respond to the Statement with some sadness and considerable concern. Noble Lords, particularly those on the Government side of the House, will be aware that the NEDC was introduced by their former colleague the first Earl of Stockton, who, as Prime Minister Harold Macmillan, represented, I suppose, the kind of concerned Toryism that seems to have died out in more recent times.
In responding to today's Statement I am also rather surprised because all my preparation was in anticipation of a Statement saying that the Government intended to strengthen the NEDC. Indeed I half thought that it would be moved from the Treasury to the new President of the Board of Trade. I am very much taken aback by the Statement, which apart from anything else seems to represent a defeat for the new President of the Board of Trade who is on record as saying over many years precisely the opposite of what is in the Statement, not least during the course of the general election that has just been fought. I was also under the impression that the right honourable gentleman the Prime Minister was moving us away from what I might call the ethos of a Statement of this kind into something again representing or corresponding to what I understood the modern Tory Party believed in. Clearly, I was mistaken.
The Statement refers to the era of corporatism passing and seems to imply that there is a contradiction between the view that the market mechanism should be made to work as efficiently as it can and the view that there is a role for government in meeting all sides of industry. I should like to hear from the Government how they have come to the conclusion that there is some kind of contradiction. This has nothing to do with politics. Although we may disagree on where to draw the line between the private

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sector and the public sector, most of us believe that the market mechanism cannot function on its own, that it requires an appropriate infrastructure and requires an appropriate atmosphere set by the Government. Therefore I should like some more and better particulars from the Government on that matter.
The Government are right in saying that governments across the world have pursued more market oriented policies. However, does the noble Earl agree that they have not abandoned the kind of tripartite set-ups that NEDC represents? They have done precisely the opposite in Germany, Japan and France. There is no conflict between the two approaches. If one needs any more conclusive evidence that the market does not work on its own and needs help, one simply has to look at the housing market, Canary Wharf or any of those matters. The market will not recover on its own. It requires government and it is helpful when all sides of industry meet in order to encourage that.
I accept what is said in the Statement about the council being dominated by producer interests. But I ask myself, "Whose fault is that?" Who appoints to the NEDC? It has always had—I accept that it was the case when we were in power—one symbolic representative of the Consumers' Association or the Consumer Council, but that did not necessarily have to be the case. If the NEDC is as useful a body as I think it is, one could have strengthened that side of it.
The Statement says that,
"the continued existence of the NEDC … may actually have inhibited, rather than encouraged, the development of direct contact on specific issues between the Government and trade unions and other employee associations".
Can the noble Earl give any examples of this inhibition of direct contact, given that it was only a matter of the Government picking up the telephone and saying, "Come and see us, and we'll spend a few shillings on beer and sandwiches", and there could have been such direct contact? What is it that inhibited the Government that they now say that they must abolish this body?
On the specific working parties, I thought that almost everyone who had any experience both of being on the working parties and of using them thought that they had made an extremely valuable contribution. The noble Earl has said nothing about how that kind of detailed work, producing, for example, particularly important reports on training, will be replaced. Perhaps the noble Earl can tell us more. We are told that the Government intend to approach such detailed issues in a new way. Again, I should like to ask the noble Earl whether he can tell us anything more about what they have in mind.
The noble Earl voiced a particular vote of thanks to Dr. Walter Eltis, the director general. He is an old friend of mine. I should certainly like to associate myself with that vote of thanks. Of course, Dr. Eltis is an outstanding economist who is actually devoted to the kind of economics that appeal to the Government side of your Lordships' House rather than to this side. That does not make him any the poorer an economist. But I hope that the Government will have the sense to ensure that he is retained in the government machine
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once he gets the sack at the end of the year—although, if he goes back to academic life, that will at least be enormously beneficial to that world.
The Statement says that the Government have consulted more frequently in recent years and with a wider range of interests. Again, I have to tell the noble Earl that that is complete news to me. I should like to be given some examples of that increased consultation. Everyone in industry thinks that the Government have consulted less and less.
More generally, I have to say that it seems to me that the Statement is sending out the wrong signal to industry. Here we are in the midst of a very long recession and we have what most of us as economists predicted was impossible; namely, a major balance of payments deficit at the bottom of a deep recession. I certainly thought that that was impossible, but then this Government specialise in showing how bad I am at economics. However, as I said, we have this considerable deficit which the latest figures show to be larger than we thought. Therefore, is this the time to send out such a signal to industry? The greatest concern of businessmen to whom I have spoken about the Department of Trade and Industry over the past few years was that the then Secretary of State constantly replied to what they had to say by essentially telling them that they were on their own and that government had nothing to offer them, except good wishes.
Following the election, and especially with the new Secretary of State and the Prime Minister now being established, I had thought that the department would be sending out a quite different message to industry. I am afraid that the message is not one that British industry on all sides will find particularly satisfactory.
Baroness Seear: My Lords, we on these Benches also thank the noble Earl for repeating the Statement. We agree that the age of corporatism is over, and rightly so. As the noble Lord, Lord Peston, was prepared to admit, it has been dominated by producer interests in both parties—that is, in the Government party and in the Labour Party. Although we recognise that there has been a sea change in some sections of the Conservative Party, both have been representative of producer interests. The determination that that should not continue is something that we very much welcome.
Having said that, there are a number of issues about which we should like to have more information. The Statement says that,
"some of the issues addressed by the council and these sub-groups will of course remain on the agenda".
On whose agenda? I believe that the noble Lord, Lord Peston, inquired whether it would be the Treasury's agenda or that of the DTI. After all, we have a DTI and it presumably has policies to do with industry. If not, what is it there for? We ask that, in the development of its policies to do with industry, it listens to industry. The department may not have, or need, a Neddy, but it needs to be in constant contact with, and to receive advice and information from, industry to deal with the rather vaguely referred to items on the agenda in the Statement. Surely it is crystal clear that the department should be listening to

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both sides of industry. That is not corporatism; it is sensible consultation with the people who know about industry, who have a special interest in it and a special knowledge about it and without whom no sensible industrial policies can possibly be developed.
If the department does not do that, who will invent the industrial policies? Will it be the Civil Service? That will not get us very far. Alternatively, will it be the politicians? I also doubt that that would get us very far. We are dependent upon something to take the place of the Neddies, given a government who claim to be a listening government. We should very much like to know what those mechanisms will be —without corporatism, yes.
Industry needs help from the Department of Trade and Industry about what is going to happen in the future. It needs information and research of the kind that only the DTI can undertake. The right research must be carried out. But will the department find out from industry and from the trade unions what are the urgent problems into which we need to have research? How will that information be drawn from industry? How will the work of the DTI be done and how will it be referred back to industry while it is taking place?
The Statement is extremely vague about future policies. It is a change from the old policies; some of that, as I said, we welcome. However, it tells us all too little about the really creative and responding Department of Trade and Industry that is needed in the future.
The Earl of Caithness: My Lords, I listened with great care to the remarks of the noble Lord, Lord Peston, and the noble Baroness, Lady Seear. I was especially interested in what the noble Baroness said in conclusion. She said that she welcomed some of the changes in the Statement. However, I do not think that the noble Lord, Lord Peston, welcomed anything in the Statement. I am afraid that, while many of us have moved on, the noble Lord has not moved on quite as fast as the rest of us. Perhaps he would like to try to catch up.
I believe that what the noble Lord was saying generally was that NEDO and the NEDC have formed a very successful organisation that has worked extremely well. Nothing that we have done since will work in any way comparable to it. As the Statement I repeated says, much of the structure of British industry has changed enormously. Working patterns have changed, with management and the workforce now much closer together. And there are training and enterprise councils. There is also much contact that was never envisaged—it did not even happen—when the Chancellor of the Exchequer set up NEDO in 1962. Therefore, the world has changed.
When we looked at the matter, the question was whether NEDO was the right organisation for the future. We believed that it was not. We believe that there is much more comprehensive contact within industry, the workforce and management, than there was previously. That has taken the place of much of the work of NEDO. As your Lordships will know, my
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right honourable friend the then Chancellor of the Exchequer, Nigel Lawson, made various alterations to the way that NEDO worked in 1987.
The noble Baroness, Lady Seear, wanted to know more about what the Department of Trade and Industry is doing. I should point out to the noble Baroness that I made reference to a Statement that my right honourable friend the President of the Board of Trade will be making, it is to be hoped, before the Summer Recess. I do not in any way wish to pre-empt what my right honourable friend will say. However, I shall draw to his attention the noble Baroness's remarks.
When the noble Baroness says that the DTI must listen to industry, I should stress that there are many more fora in which government can listen to all sides of industry than was the case when NEDO was established; for example, there are the trade associations and the innovation units. Indeed, there is a huge range of contacts which I am sure already account for more than NEDO has been doing.
3.59 p.m.
Lord Boyd-Carpenter: My Lords, as one who was a Treasury Minister in 1962, I listened to the Statement with, I must admit, some surprise. First, can my noble friend indicate whether the decision resulted from, or was affected by, any representations made to Her Majesty's Government? For example, what has been the attitude of the CBI which I understood was always very interested in the work of NEDO and NEDC? Alternatively, has industry generally made any such representations? Secondly, he referred to items on the agenda which will still continue. Would the Minister perhaps identify these and indicate by whom they will be handled?
The Earl of Caithness: My Lords, with regard to my noble friend's introductory remarks, perhaps I can understand some of his sadness, he having been a Treasury Minister when this was introduced. It is always sad when one is a Minister to see something that one has looked after change, alter and even be disbanded, as in this case.
With regard to my noble friend's first question, the decision was for my right honourable friend the Chancellor of the Exchequer, and both the TUC and the CBI have been informed. With regard to the second point that my noble friend raised, it will be up to industry to decide what are the subjects to be discussed, and not only that, but which will be the best fora in which they can be discussed and pursued.
Lord Stoddart of Swindon: My Lords, unlike my noble friend on the Front Bench, as soon as I saw that we were to have a Statement about Neddy I knew perfectly well that the Government were going to abolish it. I merely read the open book; I did not gaze into the crystal ball. Everything they have done about Neddy over the past 13 years indicated that they were about to abolish it. First of all, perhaps the noble Earl would answer the question posed by his noble friend. Did he have any representation from industry, particularly the CBI and other representative

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organisations, that this body should be abolished? I believe the House is entitled to a straight answer to what was a straight question.
Secondly, the Statement says that the council has been dominated by producer interest and that is the main reason given for abolishing Neddy. If that were so, would it not have been more sensible to widen Neddy to take account of consumer interests? Would that not have been the sensible way forward rather than to abolish a body which gives the Government the opportunity to discuss, together with both sides of industry, economic difficulties and policies of the day?
Is the noble Earl aware that this will have a devastating effect on the trade unions, which have been criticised, insulted and vilified over the past 13 years? Is it not a signal to them that the only way forward for them now—for them and their members, if they are to have a voice—is to become more militant? They have lost the body on which they could get together with employers and government to discuss things in a reasonable manner. They are now pushed even further away—further at arm's length so that they will have no voice at all. Bearing that in mind, will the noble Earl—I know that he is not responsible for it—convey to the Government the view certainly of people on this side of the House that we simply cannot understand why the Government wish to abolish an organisation which they could have developed not to the advantage of this side of the House but to their own advantage and the advantage of the whole of the country?
The Earl of Caithness: My Lords, the noble Lord said that it was solely due to the producer interests on the NEDC that the Government have decided to abolish it. That of course is not correct. It has been dominated by producer interests. But the question is whether it is the right forum in which to get the best out of negotiations and discussions that have quite naturally to take place. We believe that it no longer is. Rather than expanding it, we believe that British industry can now be served very much better by discussing it, as has been the trend, on a much more local and specific basis. The reason for that is quite clearly that the nature of industry has changed quite substantially since 1962. Industries are now far more international. If one looks at our big industries, one finds that they have bases all round the world; they are working on a global policy rather than on a national policy. Because of international competition and the international nature of industry the days have gone when one could put things into nice little boxes.
The noble Lord talked about the unions. I had quite a lot of experience before coming into politics and I can say that the whole climate is a great deal better than it was before. There is much more discussion and healthier discussion between unions and management. Rather than the stand-off approach which I remember as a teenager in those terrible dark days the whole approach between management and the workforce is considerably better and very much more constructive than it was.
Lord Boardman: My Lords, I hope that my noble friend will be relieved to know that I at any rate
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welcome the decision. Perhaps he can confirm that Neddy was created originally with the three power blocs—government and the then two very definite sides of industry which happily have since become blurred. That inhibited greatly the flexibility that it needed. Perhaps the Minister will be able to say that with the abolition of Neddy the Government hope to achieve a greater degree of flexibility to assist industry in its way forward, particularly in Europe.
The Earl of Caithness: My Lords, I am very grateful to my noble friend. He has considerably more experience than I have. He confirmed the change in working practices and that the two very definite sides of industry have become a great deal more blurred —to use my noble friend's words. Of course we believe, and it is our intention, that the proposals that my right honourable friends will be bringing forward should afford a great deal more flexibility in our discussions with industry.
Lord Cockfield: My Lords, like my noble friend Lord Boyd-Carpenter, I have a personal interest in this in that I was one of the founder members of the National Economic Development Council. Indeed, I became a member of it the second time round when I was Secretary of State for Trade in 1982. May I say, with all due respect to my noble friend Lord Caithness, that this had nothing whatever to do with corporatism. I know that it is fashionable to invent history to comply with one's own view as to present policy, but it is not really a very desirable way of approaching these matters. On this occasion I do not propose to go into the reasons and what lay behind the establishment of Neddy in 1962, although I was in fact directly involved in it with Mr. Harold Macmillan, as he then was. The real function of Neddy was twofold. It was first of all to produce forecasts of the national economy, properly broken down for the years ahead, thereby replacing what had been the old economic survey which had been produced under the inspiration of the late Lord Keynes during the 1945–50 period. Secondly, it was intended to act as what I might essentially describe as a think-tank for industry. I realise that so far as the first function is concerned the Government themselves now produce forecasts for the economy for the periods ahead. Whether they are any better or indeed as good as those that we used to produce in the 1960s may well be a matter for debate. But that is a different issue.
So far as the second point is concerned—and this is the issue I want to ask my noble friend about—I know there are innumerable think-tanks now existing, but the enormous merit of Neddy was that it brought together a wide range of people, not only on what are commonly described as both sides of industry and the Government, but there were also independent members of Neddy. Therefore it was a wide spectrum of views. The trouble with most think-tanks is that they are very much oriented in particular directions, either politically or on the basis of particular economic theories. So often they are promoting a point of view rather than trying to do what Neddy tried to do, which was to find solutions to accepted problems. I think that the disappearance of Neddy will leave a real gap

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here. Do the Government propose to do anything to fill that gap, or will the vacuum be left to be filled by other people with a less balanced view of many of the issues involved?
The Earl of Caithness: My Lords, with the changing nature of industry within this country and throughout the world, the detail and complexity of the problems about which my noble friend was talking have changed significantly since 1962. There will, of course —my noble friend was right about this—be issues that will need to be discussed. As I said in the Statement that I repeated, I am sure that it is best for industry to work out the best way to look at the particular problem with those who might be involved in trying to address it. That is one of the ways in which my noble friend's anxiety will be met. Another relevant point —and it was mentioned in the Statement—is the Statement that my right honourable friend the President of the Board of Trade hopes to make before the Summer Recess.
Lord Irvine of Lairg: My Lords, perhaps I may be the third Member of your Lordships' House, in addition to the noble Lord, Lord Boyd-Carpenter, and my noble friend Lord Stoddart of Swindon, to ask whether the CBI, or any other body representative of employers, recommended the abolition of the NEDC to the Government. Having been given two opportunities to answer that question, will the Minister take this third opportunity and answer the question yes or no?
The Earl of Caithness: My Lords, I apologise for my oversight in not replying to the point raised by the noble Lord, Lord Stoddart of Swindon, which has now been repeated by the noble Lord, Lord Irvine of Lairg. We have not received representations.
Lord Marlesford: My Lords, I warmly welcome the abolition of an old friend of many Members of the House. Does my noble friend agree that 30 years is long enough for most institutions to exist? It is good that they are scrapped. There are far too many institutions—
Noble Lords: Oh!
Lord Marlesford: My Lords, I said "most" deliberately. There may well be other institutions which could, with advantage, go into honourable retirement. I suspect that it is only the NEDC's abolition that will be noticed. It has not been noticed for a long time by most people.
Does my noble friend agree that many of the changes of the past 30 years, and especially the past 10 years, have produced institutions which will fulfil several of the NEDC's functions in a more modern way? I am thinking in particular of the Citizen's Charter, the regulatory mechanism for the now privatised monopolies, the TECs which have already been referred to, and the more proactive role that my right honourable friend the President of the Board of Trade will undoubtedly fulfil.
Does my noble friend agree that there is a gap which the resources released by the abolition of the
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NEDC might be used to fill? I refer to the need for much better scrutiny by industry and government of proposals which emerge from the European Commission. They need to be questioned under the principle of proportionality. That is, their benefits should be measured against the costs which will fall upon those who are asked to implement them. Will he consider discussing with his right honourable friends the setting up of some new institution—30 years may be enough for it to do its work—to enable industry and government to consider European proposals which may have a heavy impact on industry, often without corresponding benefit?
The Earl of Caithness: My Lords, as regards the first part of what my noble friend said, he put the matter in a more succinct form than I have been able to do in response to questions. With regard to the second point that he made, I shall of course draw his remarks to the attention of my right honourable friend. My noble friend raised a valid point when he said that there was a need to look at draft EC directives as the single market approaches. Considerable work has been done on that aspect of the matter. The cost of complying with those directives might deserve special attention in the future.
Baroness O'Cathain: My Lords, like many Members of your Lordships' House it was with considerable sadness that I heard the Statement, because, like some Members of your Lordships House, I cut my economic teeth on the NEDO, and so I feel that this is a sad moment. What is coming through is the suggestion that the NEDO has not changed. That is not true. It has evolved over the past 30 years. It has not remained static. In the early days of working with the NEDO there was confrontation, but that was defused by the work done by the little NEDOs. People went on from little NEDOs to working parties. The working parties did some valuable work which included looking at EC directives to see how they would affect industry. Recently, some of the working parties have managed to include representatives from Continental Europe. The NEDOs have not been stuck in concrete since 1962. One of the most valuable things that the NEDC has done is to build up trust and understanding among industry, the Government, the unions and/or the professions. It is important that it is not on a one-to-one basis. It is important that the discussions should take place in a room with three people. One can always have discussions with someone on a one-to-one basis and then go and have discussions with someone else on a one-to-one basis. The value of the NEDC was that all sides of the argument were brought together, and forward we went. I fear that that advantage will be lost if the NEDO is abandoned. There must be a reason for the abolition: it may be the duplication of resources. There are obviously some areas of the DTI which are doing the work that the NEDC was doing. Will the Government look closely at the possibility of continuing to have tripartite or four-party discussions: the Government, the unions, industry, and/or the professions on a regular formal

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basis under the auspices of the DTI? That might fill the gap which is bound to arise as a result of the demise of the NEDO.
The Earl of Caithness: My Lords, I listened with care to what the noble Baroness said. She covered the point well. There has been increasing duplication. I hope that in due course the loss that she feels will be suffered by not having the NEDO will not be as great as she fears.
Lord Bruce of Donington: My Lords, like my noble friend Lord Stoddart of Swindon, I was not the slightest bit surprised by this afternoon's announcement that the NEDC was to be abolished. I am looking at the clock and I am looking at the Minister. In the light of his noble friend's proposed 30-year limit, upon which I do not propose to trespass, I hope that he will not use the passage of time to prevent the House from hearing my views on this subject. I do so agree, and not for the first time, with the noble Lord, Lord Cockfield: originally the whole purpose of the NEDC was to formalise, albeit sometimes on an informal basis, relations between the Government and what are euphemistically termed "both sides of industry", with the objective of trying to arrive at some degree of consensus as to how our national economy should be developed and how the various sectors within it should, within a broad, general outline, be continued and enlarged. Those were its purposes. I am not in the slightest bit surprised that the Government find it embarrassing to be confronted month by month—
Viscount St. Davids: My Lords, 20 minutes have elapsed and I think that we should continue the Business of the House.
Lord Bruce of Donington: My Lords, I entirely agree. The Government's attitude has been pathetic, and it is as well that they terminate the process.

Judicial Pensions and Retirement Bill [H.L.]
Second Reading debate resumed.
4.19 p.m.
Lord Wigoder: My Lords, we now revert to the even more interesting topic of judicial pensions and retirement. The Companion to the Standing Orders makes it clear that only the speaker immediately following a maiden speech should refer to the maiden speaker. That directive is almost universally ignored on occasions such as this and I also propose to ignore it. Perhaps I may say both personally to an old and trusted friend, the noble and learned Lord, Lord Taylor of Gosforth, and on behalf of these Benches that we congratulate him on his appointment. We wish him well in the arduous office which he has undertaken.
No doubt noble Lords in all parts of the House will remember the noble and learned Lord's illustrious predecessor, the noble and learned Lord, Lord Lane.
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We hope that in his well-earned retirement he will find time to come here and help us occasionally in our deliberations.
The observations that I have to make on the Bill are not in any way of a party political nature. They arise out of my limited experience as a member of the Bar for many years, who sat judicially part-time for many years and who has been for a long time the trustee of a substantial pension fund in the private sector. (I hasten to say that it is not the pension fund in everyone's mind at this moment). Therefore I propose to make only general comments at this stage. Detailed matters can wait until the Committee stage.
I wish to comment first on the pensions aspect of the Bill because it appears to me that logically it must be considered before we examine the retirement aspect. It is of little use to consider whether there should be an age of retirement and, if so, what it should be, unless we have at least established what should be the accrual period before a judge would be entitled to take his retirement on full pension.
It is clear that the Bill is not intended to be an act of generosity towards the judiciary. Indeed, it states that:
"the [financial] effect on public expenditure is expected to be broadly neutral".
With those gloomy words it is clear that, added to what the noble and learned Lord on the Woolsack said, the object of the Bill is to iron out inconsistencies and anomalies; the object is not to indulge in generosity, if that can be avoided.
There seem to me to be three issues to be considered in the Bill at this stage, apart from the detailed issues: first, should the accrual period be 20 years or, as for most of the higher judiciary at present, 15 years? Secondly, should the pension be a half rate, 50 per cent. pension on retirement or, as the Bar Council and one or two other optimists have suggested, should it be increased to a two-thirds rate pension? Thirdly, should there be a retirement age? If so, should it be 70 or, as the Bar Council and others have suggested, the somewhat earlier age of 65?
On the accrual period of 20 years which is now written into the Bill, I understand that the Government's attitude is that, bearing in mind the Finance Act 1987, it is a logical period which would be consistent with what takes place in the private sector. The fact that it is logical and consistent with the private sector does not prevent my wondering whether it is sensible.
In passing, I congratulate the noble Lord, Lord Mishcon, upon his elevation to silk. For the reasons which he indicated, there is no comparison between the situation in the private sector where, for the whole of a person's working life, even though he may move from one company to another, his pension accrues steadily, and the situation where someone who is practising on his own account, probably until his early or mid-fifties, may then take employment on the Bench.
There is one other reason why I believe that the 20-year accrual period should be approached with hesitation. Again the noble Lord, Lord Mishcon, touched upon it. It seems to me that the essence of a

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good judge is that he approach every case with a degree of freshness and enthusiasm, in the sure knowledge that it is the most important case that he has ever tried. Of course, it always is for the litigants. The essence of a good judge is that in those circumstances he will exercise total patience, total tolerance and peacefully endure the long-winded irrelevancies of some witnesses and perhaps also of members of the Bar.
As the years go by it is almost inevitable that a degree of routineness enters a judge's consideration of the cases which he is trying. The temptations on occasions to cut someone short or to show a lack of enthusiasm for the matter which he is trying are bound to increase as the years go by. Twenty years of trying cases one after another, day after day, is a strain upon a judge. I believe that it may be asking too much of those few judges who are not superhuman to expect them to be able to endure it for the period that is necessary, according to the Bill, before a full pension can be earned.
I turn to the second matter, the half pension against the two-thirds pension. I am aware that it is easy to get carried away by the consideration that in the private sector two-thirds pensions can be earned after 20 years and will be earned almost as a matter of routine by anyone after they have been employed for 40 years in any good company scheme.
The distinctions between this scheme and a private scheme should be borne in mind when we weigh up whether the 50 per cent. pension rate proposed in the Bill and which exists at the moment, is adequate. It must be borne in mind, first, that for this scheme pensions are not contributory, whereas with most private schemes they are. Secondly, for this scheme there is a tax-free lump sum payable on retirement at the moment of two-and-a-quarter times the amount of the pension and that is in addition to the full pension. However, under most private schemes, although a tax-free cash option is available, it can only be obtained by commuting part of the pension and the pension being reduced, as a result, if one wishes to take the cash option.
Thirdly, as with all Civil Service schemes, this scheme is fully index-linked. That is unusual, though not unknown in the private sector. Fourthly, there is one other consideration which affects not only the balance between a half rate and a two-thirds rate but also the length, whether it is a 15 or a 20-year accrual period. When many members of the Bar join the Bench they are in receipt of substantial incomes. It has been calculated that in the past three years the appointees to the High Court Bench, while at the Bar, have earned over £200,000 a year. That means that before going on the Bench many people have been in a position to make some contribution towards their own and their families' future. I believe that that factor ought to be borne in mind, should anyone suggest that the half rate proposed at present is in any way niggardly compared with the more generous provision in the private sector.
I hope that the noble and learned Lord will assist me on a matter which may become relevant if we
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consider the detail of this issue in due course. In the private sector a person who is self-employed and makes pension arrangements for himself and then becomes employed in the private sector and earns a pension from his company finds that there is an immeasurably complicated relationship between the two pensions. I should be grateful to know exactly what the position is in relation to judicial pensions if a member of the Bar has provided himself with a private pension which might conceivably be greater than the judicial pension. Are the two to be added together or does he receive no judicial pension, or does he receive a judicial pension calculated on some basis such as sixtieths, which I believe is the practice in the private sector?
If the pension which he has provided for himself is less than that which he obtains under this Bill will he receive the two cumulatively, or will his judicial pension only be paid to him after deducting the amount that he has earned by his own efforts at the Bar? That again can happen in the private sector. I should be grateful for that information, but it seems to me that on balance at the moment the 15-year accrual period is a more sensible proposal than the 20-year one, and that the 50 per cent. rate that is proposed in the Bill is perhaps the right approach rather than the two-thirds rate that has been suggested in various quarters.
Finally, I turn to the proposal for retirement at the age of 70. I welcome that proposal. I welcome it not only because it is the current trend in all the professions and much of industry to have earlier retirement, but also because it seems to me that the strains that are put upon the judiciary are not always fully appreciated. A judge has to listen for four or five hours a day to every single word that is being spoken. One must not miss the odd sentence while one is wondering vaguely how the England team is faring at Lords in the Test Match, or whatever event it may be. A judge has to listen and simultaneously work out the relevance of the words in the case and the evidence as a whole. He has to consider whether issues of law are raised that will have to be commented on in due course.
In a criminal trial particularly, a judge not only has to listen but he also has to anticipate what may be said in the immediate future, because it may well be that firm action is required as a matter of law at that stage, in anticipation, before the trial turns itself into some form of mistrial. The physical and mental stresses of being a judge and doing that task day after day cannot be exaggerated. However physically and mentally fit people may be, in the ordinary sense of those words, after the age of 70, it is unfair and unreal to try to place those burdens on them on a daily basis once they have reached that age.
I also welcome the fact that under Clause 25 of the Bill judges will only occasionally have their retirement age extended beyond the age of 70. I myself see nothing in the clause, although I may well have misread it, that gives the noble and learned Lord power not only to extend a judge's term of office after the latter has reached the age of 70, but also to bring a judge back after he has retired provided that he has

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not reached the age of 75. I hope that practice will not continue as I believe it is unfair on the litigants and it does not do the cause of justice good that there should be people who are known to have retired and who are being brought back after their retirement to try cases.
If we establish a retirement age of 70 for judges and an accrual period of 20 years, that will mean that we shall be seeking High Court judges by the time they have reached the age of 50. In all probability those people will have taken silk fairly recently. If one puts both parts of the Bill together and looks not only at the accrual period but also at the retirement rate, one can see that perhaps the shorter accrual period that is being suggested has a great deal to be said for it in the public interest. I am thinking entirely of the public interest and not the interest of the judiciary in this matter.
Looking at the Bill as a whole I believe that it has a great deal to commend it. The one principal issue which I have indicated concerns the accrual period on which I shall listen with great interest to the observations of those who have far more experience than I.
4.35 p.m.
Lord Taylor of Gosforth: My Lords, I wish first to thank my noble and learned friend the Lord Chancellor and the two other noble Lords who have spoken before me for the kind personal remarks of welcome they made to me. Apart from the trepidation natural to a maiden speaker addressing this illustrious House I have today two additional embarrassments. First, as I have only recently taken office, it may seem premature and indeed perhaps defeatist for me to be speaking of retirement. Other noble and learned Lords will be addressing your Lordships in this debate. They are not only more experienced in the ways of this House than I, but, if it is not indelicate to say so, they are also closer to retirement.
It is written, not in the Book of Judges, but in the Book of Kings:
"Let not him that putteth on his armour boast himself against him that putteth it off".
But, without boasting myself against noble and learned Lords who are more seasoned speakers, I feel it my duty as Lord Chief Justice to speak on this Bill.
It is that duty which raises my second embarrassment. The custom of the House is that a maiden speech be short and uncontroversial. To be short I shall therefore confine myself to the main policy of the Bill and hope that, if on one or two proposals I sail close to controversy, your Lordships will extend your customary indulgence and courtesy. This is an important Bill with far-reaching effects not only for the judiciary but also for the public which it serves. The Bill has been brought in swiftly and I believe the House would not wish its timing to prevent my expressing my true views on it.
The two main thrusts of the Bill are to lower the age of judges' retirement and to increase the period they must serve to qualify for a full pension. Your Lordships may well think, and it is my concern, that those two thrusts are in opposite directions. As to retirement I strongly welcome the proposal in Clause
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25 to reduce the normal compulsory date for future appointees to the age of 70. Indeed the judiciary has over the last couple of years taken the initiative in urging a reduced retirement age.
I also welcome the proposal to make that retirement age uniform, whereas it has been 75 for High Court judges and 72 for Circuit judges. Although reasoning powers may well be undiminished after 70, I believe there is a real risk that thereafter a judge may be less responsive to new laws and to changing mores. Also with the rest of the community moving towards earlier retirement the retention of the existing retirement ages for judges is, I think, unacceptable and rightly criticised by the public.
In principle I also support the proposal of an absolute bar on sitting after the age of 75. It would be anomalous to reduce the normal retiring age to 70 but to permit a judge, however spry and sprightly, to continue after 75. I must, however, point out that to introduce an absolute bar at 75 forthwith will substantially increase the problems we already have at present due to shortage of judges.
I hope that legislation can be introduced very soon to increase the number of High Court judges and Lords Justices but at present it is necessary, especially in the Court of Appeal, to rely upon retired judges to assist. If a Lord Justice falls sick temporarily or is diverted for months to head an Inquiry, the only recourse is to invite a retired Lord Justice to return.
The one point of principle in the retirement provisions of the Bill which does concern me, is the proposed machinery for extending the tenure of judges between 70 and 75. Clause 25(5) proposes that a judge may be authorised to continue in office after 70 for a year and from year to year up to 75. That authorisation is to be given solely by the appropriate Minister, should he consider it desirable in the public interest.
I have no doubt that my noble and learned friend the Lord Chancellor will exercise that power fairly and wisely. I expect him also, from the cordial consultations to which I have already been party, to consult with the Heads of Division as a matter of practice. Nevertheless, constitutionally your Lordships may consider it preferable that such consultation be made a formal requirement in the Bill. Senior judges not infrequently have to hear applications for judicial review of ministerial decisions. On occasion, they may concern the Lord Chancellor himself. It would be unfortunate if extension of a judge's tenure were under consideration by the appropriate Minister at or about the very time the judge was deciding such a case.
One possibility might be to adopt the procedure laid down for Scotland by Section 22 of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1985, which allows the Lord President:
"as a temporary measure … to facilitate the disposal of business",
to extend a judge's tenure up to 75 with the consent of the Secretary of State. In English terms that would mean myself or one of the Heads of Division with the consent of the Lord Chancellor.

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Finally, on the question of retirement, I welcome the assurance from my noble and learned friend the Lord Chancellor that the power to extend a judge's tenure from 70 to 75 will be used sparingly and not as a substitute for appointing new and younger judges. Otherwise, the new retirement age of 70 may be regarded as mere window dressing and the true retirement age will continue to be 75.
I turn to the pension provisions in the Bill. I fear that I shall not command the eloquence of the noble Lords, Lord Mishcon and Lord, Lord Wigoder, but I should like to adopt their criticism of one provision; namely, the main provision, which requires 20 years' service to earn a full pension. I hope that that may be reconsidered. The present term of 15 years has stood for a very long time—in fact, I am told, since before 1800. It has done so because, uniquely, judges begin their term of public service in middle age as a second career after practice as barristers or solicitors.
The normal age for appointment has in practice been between 50 and 55 and some judges are appointed even later. A pension accrual period of 15 years is appropriate to that age of appointment; but an accrual span of 20 years, coupled with the new retirement age of 70, will require either much earlier appointments or forced acceptance by appointees that they will not be able to earn a full pension.
At the present time many judges appointed at about 50 retire on a full pension after 15 years' service. That is especially so among circuit judges, who form the majority of our judiciary. Sitting as they do mostly in the same place, trying the same limited range of cases week in and week out, leads many of them to feel after 15 years that they lack the zest and freshness to continue.
I fear that the effect of the proposed change will be that appointees at 50 will feel they have to soldier on to 70 to earn their full pension. There will therefore be an increase, not a decrease, in the average age, certainly of the circuit Bench, whereas the Bill rightly aims at earlier retirement. Worse than that, judges who feel bound to do their 20 years, may in their last few years be functioning below their best, which cannot be in the public interest.
It can be said that judges will not be obliged to do 20 years. They can leave earlier with a due proportion of the full pension. It is also true that during their time at the Bar or as solicitors they will have had the right to make some provision for private retirement benefits.
I make three points in reply. First, the pension provisions of a public service appointment should, as a matter of principle, be on terms which do not require topping up from elsewhere and the accrual span should be that which is expected to be served.
Secondly, while the most successful Queen's Counsel may well be able to provide themselves with sizeable retirement benefits before going on the Bench, that does not apply to all judicial candidates. Successful advocates earning high fees are not the only or indeed necessarily the best candidates for the Bench. Lawyers who have heavy family and mortgage commitments, have children in education, and who
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are not high earners may have little to put aside. In particular, women lawyers who have had breaks in their practice in order to bear and bring up children may not have achieved earnings sufficient to make provision for retirement. They will often be worthy candidates for the Bench but the 20-year accrual span will be a strong disincentive.
Thirdly, if it is proposed to facilitate the 20-year accrual span by appointing judges earlier, then there is a real danger that the practising profession will be prematurely deprived of its experienced members, upon whom the Bench relies in the heavier cases. That, too, cannot be in the public interest.
Accordingly, while I welcome on behalf of the judiciary many of the proposals in the Bill, I am concerned about the pension provision to which I referred. It is said that the proposed 20-year span is to bring the judiciary into line with others in regard to pension schemes and to eliminate an anomaly. Bringing into line is not necessarily and in all cases desirable. An exception is not always an anomaly. For the reasons I ventured to give, the judiciary is a unique category of public service.
The 15-year period has been maintained up to now for good reason. I am concerned that if it is extended to 20 years, not only will the policy of having a younger judiciary, at which parts of the Bill are aimed and which I applaud, be undermined; there will be serious problems of recruitment, judicial staleness and injustice. I therefore invite the Government to reconsider that provision of the Bill.
4.48 p.m.
Lord Hailsham of Saint Marylebone: My Lords, I originally put down my name to speak in this important debate because I felt—I still do—that, having served 12 years in a post which necessarily involved me in advising either the Crown direct or the Prime Minister in the Prime Minister's function toward the Crown in the appointment of judges, I might look at matters from a slightly different point of view than some others of your Lordships.
I came to the House this day intending to take my name off the list of speakers. I saw however that the noble and learned Lord who has just spoken was to make his maiden speech and that my name came immediately after his. I could not resist the temptation to keep my name on the list. I say with a full heart that it is a matter of great pleasure to me, I believe on behalf of all your Lordships, to congratulate the noble and learned Lord on the speech that he has just delivered. He need have no reservations about his decision—to which he rightly came—to err, if at all, on the side of the controversial. From his unique position, he is the person most suited to say what needed to be said from the point of view of the judiciary. Therefore, although many regard it as a requirement of a maiden speech that it should be maidenly in content, I am pleased that the noble and learned Lord on this occasion deliberately set out to express his own views and, I believe, those of many people who have experience of this matter.
I revert to the situation as I view it having been Lord Chancellor over two separate terms of office for

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a period of about 12 years. The overriding consideration that everyone, not only Lord Chancellors, ought to have in mind in such legislation or in the discharge of their day-to-day functions is an adequate supply of properly qualified judges to fulfil the demands made upon them by the work of the courts. The quality and availability in suitable numbers of the Bench are an overriding consideration; it is not argument from first principles. Judges do not grow under gooseberry bushes if they are to be in sufficient quantity and of adequate quality. On the contrary, they are in an almost unique position, not only in the professions but in the world, as the noble and learned Lord has just reminded us.
I cannot help noticing that at the time I was called to the Bar, the noble and learned Lord, Lord Taylor of Gosforth, was just two years old. He was called to the Bar when he was about 24. If he had been born a Frenchman, or another member of the Continental system, he would never have been called to the Bar. After passing his law examinations in the university, he would have become a judge. It is a separate profession from the practising profession of advocate or adviser. He begins as a petit juge d'instruction and if he is lucky enough to reach the eminence of the noble and learned Lord he becomes the président de la cour de cassation, or the equivalent in other countries.
In other words, the Anglo-Saxon countries have the unique system of appointing judges, and that system involves appointing them from among the company of available experienced and successful practitioners. As the noble and learned Lord said, it is not every successful practitioner who would necessarily make a good judge. On the contrary, there is what Lord Chancellors have come to discuss as the temperamental hazard which inevitably afflicts us in making our recommendations. To some extent that has been overcome by the large number of part-time judges in the early stages whom we appoint without giving them pensionable appointments.
However, it means that the criteria by which we must judge the Bill do not depend upon its terms or the desirability—which I would say in the abstract is unquestionable—of removing anomalies or dealing with issues from the point of view of first principles. The real test is this: will we attain an adequate number of judges to appoint in the coming years, not at some future date?
For that, we must reflect on some disquieting facts. First, there are the increased demands of the courts. I am not good at quoting figures but I do not believe that they are out of scale. Since the war indictable crimes coming before the courts have increased at about the rate of 10 per cent. compound interest. The same has been true of family law work dependent upon the breakdown of marriage. The same has very largely been true of the construction industry and the official referees' work. The number of personal injury cases depends upon the number of vehicles on the road; that has been increasing in proportion also. It also depends upon the use of machinery in factories. There is hardly a field of work which has not increased disproportionately.
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Secondly, we have created a vast number of tribunals, often with legal chairmen, to discuss questions relating to unfair dismissal—they would previously have come before the ordinary courts, if at all—fair rents, and so on. The pool from which one draws those chairmen is very restricted. If one limits oneself to successful practitioners, whether one relies on solicitors and barristers, or barristers alone, one is confined to the pool of persons called to the Bar or admitted as solicitors 20 years ago. It is no good saying, "Let us have more women" unless one considers how many women were called to the Bar 20 years ago and have continued to practise. The same argument is true of the ethnic minorities. When I state that good judges do not grow under gooseberry bushes, I am pointing to one of the fundamental difficulties with which any Lord Chancellor is bound to be faced.
I do not recommend the terms of the Bill as bedtime reading. If anyone has tried to read it he or she will be greatly puzzled. However, the speeches which have already been made make clear that there are two not separate but inter-related problems that we have to face: the age of retirement; and the accrual period for full pension. It is no good regarding those as separate questions because they are related.
Thirdly, the Lord Chancellor of the day has to compete with, first, the enormous fees earned within the practising professions. He has often to compete with the attractions of going into full-time employment with Shell or one of the major banks. There are even those suitable for high judicial appointment who prefer to become heads of colleges and live in comfort and love ever afterwards although they may not have quite the income that they earned at the Bar. That reduces the pool still further.
We have to ask ourselves whether it is very clever or well timed to bring in a Bill which reduces the retiring age in future—whether or not that is intrinsically desirable—and at the same time increases the period of accrual of pension. I must offer an unqualified apology to my noble and learned friend on the Woolsack. He was gracious and good enough to invite me to a quiet discussion with him which I greatly welcomed and accepted. Unfortunately having passed what would now be the retiring age, I omitted to observe that the only date available for the conference would have been the date of the Garter service, which was yesterday. I had to send the noble and learned Lord a hasty telephone message. I should like it to be known that it is not fair of me to criticise him without apologising sincerely for my oversight. I came to the only possible conclusion: that the Garter service was a must.
I have said enough. Everyone is in favour of the removal of anomalies. No one wants judges to go on after they may have become past their best. However, if one is to recruit adequate judges on a sufficient scale to meet the vastly increasing demands of the courts and tribunals and is limited to a pool that was created 20 years ago, one has to be a little careful before one starts messing about with the retirement age, the

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employment of retired judges, and the accrual of pension. That is the note of caution that I wish to utter.
5 p.m.
Lord Donaldson of Lymington: My Lords, I echo the remarks made by noble and learned friend Lord Hailsham in welcoming the new Lord Chief Justice to this House and in welcoming his maiden speech. I say with real sincerity that I hope he will appear in this House on many occasions. I say that for a particular reason; this House is well supplied with in-house legal talent but it lacks a number of Members with a daily experience of the problems, the trials and tribulations, of the judicial workface. The Lord Chief Justice of the day is able to supply that experience. It is needed by a legislature which is involved with passing Acts that affect the courts or which must be interpreted by them.
Perhaps I may now turn to the Bill. I am not sure whether under the rules of the House I must declare a financial interest.
Lord Hailsham of Saint Marylebone: My Lords, res ipsa loquitur.
Lord Donaldson of Lymington: My Lords, I am obliged. I have only a small financial interest because Part I of the Bill relating to the pensions provisions has no application for me, unless I were to elect to apply it. I have not the slightest intention of doing so. My only financial interest relates to Clause 25 which, if it stood part of the Bill, would deny me the possibility, and no more, of receiving a modest supplement to my pension —that is based on the assumption that I am still around on my 75th birthday in October 1995. I hasten to add that I have far better reasons for criticizing that clause.
The Bill is welcome because it eliminates a number of injustices which at present arise when a judge is promoted to another office which is subject to a different pension regime, as my noble friend the Lord Chancellor pointed out. That apart, the Bill's principal features are the reduction of the normal retirement age for judges to 70, subject to possible annual extensions up to 75; a requirement that judges shall hold one or other judicial office for a period of 20 years before qualifying for a full pension; and a total bar on performing any judicial function after reaching the age of 75. I misread that clause because I read it too quickly. I thought at first that Parliament was saying that we could not do anything after the age of 75, but on rereading the clause I realise that it meant in a judicial capacity.
I wish to comment on each of those aspects. In doing so I shall inevitably cover ground that has been or will be covered by other speakers. However, I should like to make my voice heard for what it may be worth. I can see great merit in reducing the age of retirement from full-time judicial office from 75 to 70. The extent to which mental and physical powers, and above all energy, decline with advancing years varies enormously from individual to individual. There is no magic about the age of 70. If one drew a graph recording the probability—and I am talking in terms
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of probability—of a significant decline in powers, be they mental or physical, and in energy between particular ages, the line would not be straight; it would show a significant upturn between the ages of 70 and 75 and an even greater upturn beyond that age.
As regards judges, I believe that if the graph were extended backwards to cover the age groups 60 to 65 and 65 to 70 I do not believe that one would find it other than a straight line. In those age groups illness strikes, as it does at any age and in almost any occupation. However, as regards judges I do not believe that any decline in powers in those age groups could be said to be age-related. That being so, I believe that the choice of 70 is right and I wholly support it.
I turn to the proposal that a judge's tenure of whole-time office should be capable of being extended year by year from 70 to 75 at the invitation of the appropriate Minister; in the case of England and Wales that is the Lord Chancellor. That provision appears in Clause 25(3). That proposal is superficially attractive because we all know of judges who have carried out their best work during their seventies or later. A similar provision exists at present and applies to circuit judges under Section 17(2) of the Courts Act 1971. Whether or not that is a good idea in relation to circuit judges, I believe that it is objectionable constitutionally and as a matter of principle in the context of High Court judges, Lords Justice of Appeal, Lords of Appeal in Ordinary and, perhaps above all, in the case of the four designated judges who have special responsibilities under the Courts and Legal Services Act 1990, of which I happen to be one.
The crucial difference between those judges and circuit judges is twofold. First, unlike circuit judges those judges are responsible for resolving disputes involving the Executive as a party, in particular in the field of judicial review. The four designated judges have placed upon them the additional duty of concurring or refusing to concur in constitutionally important decisions taken by the Lord Chancellor of the day. Secondly, unlike circuit judges those judges are not dismissible by the Lord Chancellor under Section 17(4) of the Courts Act 1971. They are removable only by a joint address of both Houses of Parliament. By a parity of reasoning any extension in their terms of office should be subject to special provisions.
Accepting as I do that the Lord Chancellor of the day and the judges concerned would not allow themselves to be influenced by any conflict of interest, I cannot believe that there would be the appearance of justice if a judge were hearing a case involving the Executive, which might include the judicial review of a decision of the Lord Chancellor, at a time when it was known that the question of extending that judge's term of office was under consideration.
I wish—I hope as always—to be constructive. No one would wish to lay off highly experienced judges who wish to continue to serve the public and who are capable of a few more years of good work, certainly not on the basis of some arbitrary cut-off date. There are two possible solutions. The first would be to require all High Court judges and above to retire at 70, but to use the power in Section 9(1) of the Supreme

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Court Act 1981 to enable some of them to continue to sit as retired judges on a part-time basis. The alternative and possibly better solution would be to allow the four designated judges to extend a judge's period of service from year to year up to the age of 75, subject to the concurrence of the Lord Chancellor.
The crucial distinction is that the initiative would lie with the whole-time, non-political judiciary. It would be left to the Lord Chancellor to concur, or refuse to concur as would be his right, in the context of the provision of resources. Special provision would have to be made in the case of any proposed extension to the tenure of office of the four designated judges themselves. Someone could work that out without much difficulty.
I agree with my noble and learned friend the Lord Chief Justice that extensions should not be the rule. Like him, I am glad to hear that it is not intended that they should be. Where I venture to disagree with him is in his suggestion that a statutory requirement of consultation with the designated judges or any of them would remedy that defect in the Bill, leaving the Lord Chancellor to be the decider. Again, I hope that my noble and learned friend the Lord Chancellor will not take it amiss if I say, as a general proposition, that we all know that consultation is an extremely broad term which has many connotations. It can start and sometimes end with telling the person consulted what it is that you intend to do. Therefore, I should prefer something different from that.
I turn now to the proposal that judges must serve for 20 years if a full pension is to be secured. Although that can be presented as merely constituting the removal of an anomaly, in truth it is nothing of the kind. What is anomalous, as has been pointed out in particular by my noble and learned friend Lord Hailsham, is not the accrual period but the fact that judicial appointments in this country involve embarking upon a second professional career in late middle age.
The existing 15-year term would not be as long-standing as it is if it were merely an anomaly. In fact, it reflects the curious character of the judicial profession in this country. I hope that nobody on the Government Benches will think that I am carping about this, although the Treasury will understand the point, but I should also point out that a non-contributory pension is in reality deferred pay. Therefore, the proposed change represents a concealed reduction in the salaries of the judges to whom the new scheme would apply, to the extent of 25 per cent. of that deferred pay each year.
The major vice of this Bill is the combination of a reduction in the retiring age to 70 and the increase in the full term of office to 20 years. The message must be that if you accept judicial office, you are expected to serve for 20 years. That is far too long if the judge is not promoted or given different work. In my case I would have left the Bench had I been expected to serve any longer in the Queen's Bench Division, because I was fed up with the work. One needs a change. It would mean that appointments over the age of 50 would be exceptional. That will denude the Bar of its best members. Alternatively, they will soldier on,
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accepting that their judicial career will be shorter and then they may find that the financial inducements in terms of pension are really unsatisfactory. Either way, the Bench and the legal profession will be the losers.
Finally, as regards the one point which affects me, the proposal that no one shall perform a judicial function after he reaches his 75th birthday seems to me to be both unnecessary and unwise. I say that it is unnecessary because no judge can act as such after he has retired unless he is invited to do so, nominally by my noble and learned friend the Lord Chancellor and in practice by the heads of divisions. He will not be so invited if he is not fully capable of discharging the duties of the office. He will not be so invited if there is a policy decision not to employ anybody over the age of 75.
It is extremely unwise to box yourself in with an absolute bar in this way because situations will inevitably arise when the only suitably qualified retired judge has passed his 75th birthday, perhaps by not very long, and if he cannot sit, urgent cases will simply not be dealt with.
I very much hope that that will be borne in mind because in the case of the Court of Appeal, which is my particular responsibility, I find that sickness strikes unpredictably. Equally unpredictable but constantly recurring are the sudden requests by Government for a Lord Justice to preside over an inquiry or to undertake an extra-judicial duty. Unless and until the Treasury agrees to there being spare Lords Justice to fill those gaps, which it certainly never will, we need to be able to look to retired Lords Justice to fill the gaps. One of my major problems at present is that there are too few retired Lords Justice who are able and willing to fill those gaps, although I am extremely grateful to those who do so.
I hope that this Bill, which is in many respects admirable, will not only be subject to a Second Reading but also to second thoughts.
5.15 p.m.
Lord Renton: My Lords, it is with diffidence that I rise to follow the Master of the Rolls, a former Lord Chancellor who was in that office longer than anyone else in living memory and a recently appointed Lord Chief Justice. As nearly everything that I intended to say has already been said and magnificently said by those who are better qualified than I am, I shall be brief. However I cannot refrain from adding to the praise of the noble and learned Lord, Lord Taylor of Gosforth. I sat at his feet when he was Chairman of the Bar when he was about 40 and I was over 70. That is a few years ago now. Like everyone else, I was delighted by his elevation and most interested in his speech.
I say to my noble and learned friend the Lord Chancellor that there has been remarkable unanimity so far in this debate on the important issues raised by the Bill. I must endorse the view expressed first by the noble Lord, Lord Mishcon, that it is a fallacy to assume that judicial pensions should be treated in the same way as other pensions because, in the case of nearly all other pensions mentioned in this Bill—not all but a great majority of them—the person

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concerned has been earning his pension since his early twenties, whereas we know that judges are likely to start to do so mostly after the age of 50.
The other point on which there has been remarkable unanimity is the criticism of the accrual period being extended for 15 to 20 years. I wish to add one further argument against that which, as far as I am aware, has not yet been mentioned. Under the present system of retirement and accrual, which has worked fairly well, judges retire voluntarily well before they are 70 in some cases and certainly before they are 75, having earned the full retirement pension, having served for 15 years. Of course, if the accrual period is to be extended to 20 years, there are not likely to be many voluntary retirements. As I understand it, that would go against the aims of my noble and learned friend the Lord Chancellor.
I must confess—and I may be alone in this—that I have some doubts about reducing the retirement age from 75 to 70. Surely it is a great mistake to generalise about the maturity of human intellect. Some people are burned out at the age of 60. Others—and perhaps I may venture to say that there are some among your Lordships who have spoken in this debate—have allowed their minds to continue to mature judicially after the age of 75. Such people have gone on to make formidable additions to the evolution of our statute law.
If we are not careful we shall deprive the nation of the services of the experienced members of the judiciary who fall into that category. There are some famous ones. Lord Reid continued at his best until he was over 80. The noble and learned Lord, Lord Denning, is still alive over the age of 90. I believe he retired when he was 83. Certainly up to the age of 80 he was making major contributions to the development of our law. We should therefore consider persuading the noble and learned Lord the Lord Chancellor that it would not be right to have a final retirement age of 75 but that he should retain the power to keep judges on in rare circumstances until after that age.
Perhaps I may say to my noble and learned friend that it would clear the air for future discussion on the Bill if, when he replies to the debate, he takes note of the eminent unanimity so far displayed in the debate on the question of the accrual period and of the equally important question of not insisting that judicial pensions should be treated like most others.
5.22 p.m.
Lord Benson: My Lords, there appear to be some defects in the Bill as drafted. I am told that there is already difficulty in recruiting sufficient judges of the right quality. If that is so, those defects will have to be removed, otherwise the position will be exacerbated.
The first point that troubles me is on page iii of the Bill where under Financial effects of the Bill it states:
"The difference in cost between the existing arrangements and the new arrangements will take some years to emerge, but the effect on public expenditure is expected to be broadly neutral".
I do not understand that statement. It seems to run counter to the immutable laws of arithmetic. In any
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pension scheme if one reduces the retiring age it increases the cost to an extravagant degree, depending on the number of people involved. The statement can therefore be true only if the benefits paid to the new entrants under the new scheme have been correspondingly pared off to make up the difference. It is a puzzling point. I hope that the noble and learned Lord the Lord Chancellor will explain and comment upon it at the appropriate time.
Any scheme of salary, wages or pensions must be judged by two criteria. The first is whether the payments are comparable to those paid in other walks of life to people who carry similar responsibilities; secondly, whether the scheme will inhibit or encourage recruitment. Unless both questions can be answered affirmatively and positively one of two things will happen: either recruitment will stop altogether or only the second-raters will be recruited. We have no information on those points and therefore Parliament and the public are at a disadvantage in considering those two vital matters.
When the consultation document was circulated by the Government it went to a number of people and was sent to the Top Salaries Review Body. In February 1991 the review body commented:
"the Review Body has three main points of concern and a number of more detailed comments. These matters should be addressed, ideally with the assistance of an independent consulting actuary, before steps are taken to amend primary legislation on judicial pensions. The Review Body is also concerned about the need for a clearer exposition of what is proposed, particularly for the benefit of existing members of the judiciary who need to be able to compare their existing schemes with the proposed new arrangements".
That is a disadvantage from which we all suffer. We do not have such a report before us to help us in judging the effects of the Bill. It would be helpful for such an independent and impartial report to be prepared before the Committee stage to enable us to decide what the effect is upon the judges as compared with what happens in other walks of life.
The main thrust of the Bill appears to be that the retirement age should be voluntary at 65 and compulsory at 70. The figure of 65 is already on the high side. In practically all other walks of life the retiring age is 60 and in most cases it is compulsory at that age. Therefore 65 is already too high.
The other main thrust is to reduce the accrual period at the same time from 20 to 15 years. The result is that if a judge wants to earn his full pension at the retiring age of 65 he will have to be appointed at the age of 45. In the normal run of things that will he before he has attained the experience and maturity necessary for the job. But there is an even more undesirable feature; that is, that one is taking a man out of the bracket when he is moving into his highest earning area and giving him a much lower salary. One therefore prevents him during his high earning period from building up resources of his own or a sensible money purchase scheme. The result will he that the able people will refuse appointment if it is offered to them. The quality of the judiciary will therefore diminish.
The principle of paying pensions to the judiciary is not unique to this country. Other countries experience exactly the same problems. I am not familiar with the

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details and cannot speak with authority on the matter, but according to my information the accrual period in other countries is less. In Canada and Australia it is 10 years, in New Zealand it is 16 years and in the United States nothing at all. If those periods of accrual in other countries are comparable with the judicial arrangements in this country, it means that the scheme now proposed is of a pinchpenny or cheeseparing character and that will reap its own reward.
There is another aspect on the same theme. The lump sum provisions in the scheme provide for two-and-a-quarter times the retiring pension. It is presently two times, which means that there is already an uplift of one-quarter. However, that is not the criterion by which to judge it. The two-and-a-quarter must be judged by what is payable in other walks of life of comparable responsibility. According to my information, when the pension is fixed on the basis of half the retiring salary, the lump sum payment should be three times the retiring salary.
In that context I notice that the Top Salaries Review Body said in paragraph 4, after examining the subject in some detail, that in its view the lump sum under the proposed scheme for the judiciary should be improved from 2.25 to three times the annual pension. If the review body is right, again we have the situation where it seems that the proposals for our judges are of a pinchpenny character.
The consultation document which the Government circulated was sent to a large number of people and organisations directly affected by these proposals. I believe that all of them replied. But we do not know what any of them said because their replies have not been published. In trying to assess a proposal it is very important to know what the people whom it is likely to affect think about the scheme because we have to satisfy their needs and requirements. I believe that those responses should be published so we can see what is the effect on the people who will be directly affected.
I have difficulty with Clause 25 as well, but it is of rather a different character perhaps to that which has been mentioned so far. If a compulsory retirement age is fixed I suggest that it should be adhered to and not varied. The reason for that is that whenever people are endeavouring to come back from retirement, whether they are stage stars, athletes or professional people, they usually make a mess of it. I speak with particular knowledge of professional people because I have been through the mill myself. I have discussed the matter with a great many colleagues on many occasions.
The fact is that once a compulsory retirement age has been fixed the attitude of mind changes. One becomes out of date extremely quickly. Apart from that there are physical difficulties: there is an absence of storage space for the books, records and notes which one has built up through the years which one wants to refer to; one has no settled place to work from; one does not have a secretary or any kind of back-up service in order to help one; the day-to-day professional comments and dicta which are always circulated and not received; and there is not the benefit
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of discussion with colleagues whom one meets day after day. For all those reasons I suggest that once a retirement age has been fixed it should be adhered to.
If the reason for Clause 25 is that there are insufficient judges the solution is obvious: to take steps at once (why have they not been taken before?) to appoint enough judges. Clause 25 says that the measure is in the public interest, but I do not believe that people will find that it is. I do not believe that the public will have confidence in finding that the judicial system has to be bolstered by a miscellaneous body of persons who have passed their peak.
Taking the Bill as a whole, I cannot help feeling that there are some rather cheeseparing approaches and pinchpenny attitudes which will be extremely damaging. That will reap its own reward. It means that the persons appointed to the judiciary will be second-raters. That is particularly damaging because in many cases once a judge is appointed he cannot be got rid of earlier. It is very difficult to get rid of him even when you can do so. We have had one or two examples recently. Therefore, I suggest that what is necessary is to revise those clauses in the Bill which I have spoken about—I am sorry to say in repetition because everybody has virtually said the same thing —in order to prevent that situation arising.
5.34 p.m.
Lord Ackner: My Lords, I add my congratulations to those already offered to my noble and learned friend the Lord Chief Justice, not only on the quality of his address to your Lordships but on his wisdom in ensuring that, even though the subject is potentially controversial, the House had the benefit of his view on a subject which affects the quality of the administration of justice.
Perhaps I may start my submissions, as I always try to do, on a note of harmony. I take positive pleasure in agreeing with the proposal of my noble and learned friend the Lord Chancellor that 70 years should be the compulsory retirement age. Indeed, I shall invite him to go further. It is an invitation which I hope he will find irresistible because it is based on applying the wisdom enshrined in a Scottish Act which is only seven years old.
I speak on the retirement age not with the fervour of a recent convert. Nearly 35 years ago I was responsible for the Bar Council, when there was no retirement age, compulsory or otherwise, recommending to the Lord Chancellor, Lord Kilmuir, that the retirement age should be 70. At that stage he was anxious to put up the judges' stipend from £5,000 to £8,000 a year. He knew that he had no chance of achieving that without offering a compulsory retirement age. I was responsible for what the Bar Council put forward.
The respect in which I shall be inviting my noble and learned friend to go beyond what is proposed can be stated quite shortly. South of the Border we currently destroy the underlying purpose of the retirement age by inviting judges who have retired having reached the compulsory retiring age, to continue to sit. Last year over 500 judge-days were sat by judges in the High Court and the Court of Appeal

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who had passed the age of 75. Indeed, in the Court of Appeal no less than 100 days were sat by judges who had passed the age of 80. I make it abundantly clear that this is no criticism of my noble and learned friend Lord Donaldson of Lymington, the Master of the Rolls, who has consistently sought to increase the establishment of judges in the Court of Appeal.
In his review of the last legal year he said:
"retired Lord Justices provide the biggest source of reinforcement and without their help the work of the Civil Division would be in dire straits".
He listed the eight retired Lord Justices who had sat during that year and five of them were over 80 years of age.
In Section 22 of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1985 provision is made for the re-employment of retired judges if the Lord President considers it expedient—I quote the words missing from this Bill—as,
"a temporary measure … to facilitate the disposal of business".
But that is not after they have reached their compulsory retirement age, currently 75 years. That was based on the proposition that if Parliament believes that 75 years is the appropriate age at which a judge should retire, that is an end of the matter. There is no provision in that Bill for the grant by a Minister of the Crown of any extension beyond the compulsory retirement age either "in the public interest", whatever that imprecise formula may encompass, or at all.
I believe that there are at least two very sound reasons for the Scottish legislation. They are essentially a constitutional one and a practical one. It is of the very foundation of the judicial independence that judges have security of tenure. I need hardly point out to the House that this independence enables them to act as checks on the Executive and as critics of the legislature. A vital part of their role is to stand between the state and the citizen and to maintain certain fundamental and historic principles such as the liberty of the subject, access to the courts, etc. In an entirely different context my noble and learned friend the Lord Chancellor would have seen those very words only last week in a learned article written nearly 10 years ago by my noble and learned friend Lord Wilberforce.
What is proposed under Clause 25(4) is that a judge who has reached compulsory retirement age should be given by and in the sole discretion of the appropriate Minister, without the obligation of his first obtaining the agreement of or even consulting the Lord Chief Justice or any judge, so to speak, a job at a time or an extension for a year at a time until he reaches 75 years of age. It cannot be controverted that, theoretically, his "contract"—for want of a better word —might not be renewed if he were to make decisions of which the Executive disapproved. I would ask those who say, "Oh, but this is merely theoretical", to contemplate the recent situation in which the High Court judge in the case of the haemophiliacs who contracted AIDS as a result of blood transfusions administered in National Health Service hospitals virtually shamed the Government into acting with proper compassion.
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Could one be sure that the same courage would have been shown by a judge "on contract"? And if, as I hope, the answer is "yes", what would happen when his "contract" came up for renewal?
The practical ground is also a very simple one. The ability to use—it is so enshrined at present in the Bill —on a regular and consistent basis, not as a temporary measure, judges who have passed their retirement age is open to abuse. I would ask those who might again respond, "All this is theory", to refer to Hansard of 15th July 1991, where at column 8 the noble Lord, Lord Mishcon, asked Her Majesty's Government this question:
"What is their response to the statement of the Lord Chief Justice concerning the inadequate number of High Court judges and the immediate threat that this poses to the administration of justice."
My noble and learned friend Lord Oliver of Aylmerton put this question at column 9:
"My Lords, will the noble and learned Lord explain to the House how the regular and consistent use of deputy judges under what I believe are the terms of Section 9(4) of the Supreme Court Act is reconcilable with the terms of that section which prescribe such action only as a temporary measure?"
The answer by my noble and learned friend the Lord Chancellor is most revealing. He said:
"My Lords, I have a degree of difficulty with that question. However, it is a temporary measure. As my noble and learned friend Lord Oliver knows better than I—he has been closely associated with the High Court of Justice for much longer —this practice has continued for a long time."—[Official Report, 15/7/91; cols. 8 and 9.]
The contradiction in that answer will not have escaped your Lordships. This answer caused sufficient concern in another place for the point to be raised a week later as to what the position would be if a disgruntled litigant challenged the judgment of a deputy judge on the grounds that the judge had not been properly appointed under the statute—that is, that there had been an abuse of power. The reference is column 945 of Commons Hansard of 22nd July.
If judges are to retire at 70, there is likely to be a very large pool of judges available to continue to sit in a judicial capacity, many of whom, with a 20- instead of a 15-year accrual period, would not have yet earned their full but inadequate pension. In the five years to 1st January 1992, 36 High Court judges were appointed, of whom 28—that is, 78 per cent.—were 50 years of age or over when appointed. Over the same period, 186 circuit judges were appointed, of whom 94 —that is, 51 per cent.—were 50 years of age or over.
It may not be known that it is much cheaper to make use of retired judges. Not only do pensions have to be funded for the permanent judge, but he must be provided with a proper room, with a clerk, a library and other such back-up facilities. No such facilities are provided for the retired judge. I remember hearing my noble and learned friend Lord Denning being interviewed quite recently about the proposed new retirement age. He said, "Oh, I think that that is quite all right nowadays" but added, "It will cost the Treasury a pretty penny." But it will not, as one can see from the Financial effects of the Bill, to which my noble friend Lord Benson referred. It states:
"the effect on public expenditure is expected to be broadly neutral."

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How will that come about? Quite simply, by employing judges on contract—but perhaps I am characterising them unfairly. My noble friend Lord Alexander of Weedon and I have met that situation in countries in warmer climes where it has been found to he almost disastrous.
I submit with the deepest of respect that we must put an end to this hoodwinking of the public. Again I submit with respect that there is an element of wholly unacceptable hypocrisy in proposing what appears at first sight to be radical and sensible legislation and then, by a species of back-door mechanism, undermining its very purpose.
I turn now to pensions, which I shall deal with only briefly because of the time constraints. My first point is virtually a constitutional point. The Top Salaries Review Body was set up in order that Parliament might have the advantage of a body of independent experts—I stress those words—to advise on the proper remuneration of senior members of the armed forces, the Civil Service and the judiciary, insulated from the pressures of the Treasury. As my noble and learned friend the Lord Chancellor conceded in his address to your Lordships, pensions are a vital part of a salary structure. Indeed, in report No. 29, dated February 1990, the board said that there is difficulty in finding sufficient numbers of suitable candidates for the circuit Bench. It said that one reason for that is the judicial pension, which, it suggested,
"might be made more attractive in a manner consistent with normal practice elsewhere in the public services."
I understand that Parliament, when it desired to have a proper pension scheme for its own Members, referred the matter to the board, which produced a scheme that Parliament adopted. I submit that this is precisely what the Government should have done in regard to judicial pensions. The matter should have been referred for a report to the Top Salaries Review Body. The board would have sought the advice of at least one independent consultant actuary—an expert, to whom I fear that my noble and learned friend the Lord Chancellor and his department never resorted. In case I have got that wrong, perhaps my noble and learned friend will be kind enough when he responds to the debate to tell us whether the advice of an independent consultant actuary was sought and, if so, what that advice was. What is the result of not referring to an independent body? So far from improving the pension facilities, they have been seriously downgraded.
I must reserve my detailed comments for the Committee stages of this Bill, when, relying largely on the TSRB's written responses to the consultative paper of my noble and learned friend the Lord Chancellor, I shall seek to identify the petty meannesses of a scheme which, as it now stands, is grossly out of date, particularly in its treatment of surviving spouses, orphans, illness and death in service. As has been pointed out by my noble friend Lord Benson, the scheme is mathematically flawed in terms of the lump sum.
I end by referring in two or three sentences to certain provisions in comparable jurisdictions overseas. In the United States a judge who retires at 70
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needs only 10 years' service for his full salary to continue to be paid. In Canada the mandatory retirement age is 75 years, the pension is two-thirds of salary, and at 75 years this only requires 10 years' service. In Australia the federal judge must retire at 70. He is entitled to 60 per cent. of his judicial salary, payable from time to time, upon attaining the age of 60 and having served only 10 years. In New Zealand, as a strange form of compromise, the current retirement age of the Court of Appeal and the High Court judge is 68 and requires 16 years of service for the full pension, which is two-thirds of salary at retirement and is tax free.
Ultimately this Bill, if enacted in its present form, will diminish the quality of the judiciary and seriously debilitate the independence of the judges. It should therefore carry a government health warning, expressed in another place in these terms:
"Penny pinching in the servicing of the judiciary today, builds a disaster into our judicial system for tomorrow".
5.51 p.m.
Lord Morton of Shuna: My Lords, it is usual in this circumstance, and very true, to say that everything has been said. As the first Scot, or perhaps more correctly the second Scot, to speak in the debate, I find it unusual to have Law Reform (Miscellaneous Provisions) (Scotland) Acts coming from left, right and centre. However, it is encouraging to know that they are actually read.
Perhaps I may start by dealing with the difficulty of reading the Bill, a point to which the noble and learned Lord, Lord Hailsham, referred. I direct your Lordships' attention to Clause 19(1) (b). The phrase in question also appears in Clause 19(2) (b). I spent a long time trying to work out what it means. I think that I have done so: it is confirmed by the Notes on Clauses. The provision states:
"the amount which constitutes the judicial officer's pensionable pay is less than it would have been, had the permitted maximum mentioned in section 3(3) (b) above been an infinitely large sum".
That is a complicated way of saying something. My dim recollection of mathematics—the noble and learned Lord the Lord Chancellor will quickly put me right if I am wrong —is that any finite sum must be less than an infinitely large sum. Surely the proposition could have been put more simply.
Pension provision for dependants is completely inadequate. Let us consider someone who is offered a job by a large company and at the same time a judicial position. He asks, "What happens if I die of a heart attack in the first year?" If I understand the Bill correctly, the response of the noble and learned Lord's department will be, "Your widow will get a pension of one-eightieth of salary." Is that competitive with what would be given by Marks and Spencer or any another company taking on someone from self-employment into a big job? The treatment of relatives and dependants seems very mean indeed.
The 20-year period would undoubtedly have the effect that judicial appointments would tend to come at 50 and go on to 70. The 15-year period was introduced in 1959. Since then every Scottish judge appointed to the Court of Session has been under 60

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with one exception—a judge who was at that time Lord Advocate and had to wait until a public inquiry report was published. There has been no Court of Session judge who has not done his 15 years' service before retirement; and that, I am sure, would be the position in regard to a 20-year period.
The effect on the Bar and on the conduct of cases in court would be very serious. Courts in the adversarial system depend on having very able counsel arguing on each side. They depend on certain rules, one being that every case, whether against you or for you, is argued. Those positions do not apply on the Continent where a separate judicial career can be adopted. Do the Government really expect that a Dean of Faculty of Advocates or a law officer—because most law officers tend to become judges at some point in their lives—will never be over 50? We would have lost several years of service of some law officers over the recent past if that had been true. It seems that the 20-year period would have a very deleterious effect in various ways, quite apart from the effect on judges.
I turn now to Clause 25 of the Bill. I fully agree with my noble and learned friend Lord Ackner and with the noble Lord, Lord Benson, that there is no point in having a retirement age if one does not stick to it. I do not see the point of saying that the retirement age is 70 but that the Minister can increase it.
I agree with everything said by the noble and learned Lords the Master of the Rolls and the Lord Chief Justice. In Scotland the constitutional position is worse because, according to the clause, it is not the head of the judiciary who makes the appointments; it is the Secretary of State for Scotland, who is one of the major litigants before the Scottish courts. He is responsible for the prison department, for roads, for all planning decisions and so on and as such he is subject to judicial review. How will the public regard someone making such a decision and then the Secretary of State considering whether he continues in office? The wording of the Law Reform (Miscellaneous Provisions) (Scotland) Act 1985 is the appropriate one. The Act refers to the Lord President "after consultation with the Secretary of State." But there is no real reason for having any continuation when one can have, if I have read the Bill correctly, a retired judge continuing to sit in the period between 70 and 75. That would seem to cover all the possibilities and avoid the constitutional difficulties.
One of the problems that arises is the lack of judges, a point dealt with very ably by the noble and learned Lord the Master of the Rolls. We are using far too many temporary judges. That is just as true in Scotland as it is in England. Six years ago, temporary sheriffs were only used so that their time was the equivalent of two-and-a-half full-time sheriffs. However, last year, their time equivalent was 24 sheriffs. That represents one-quarter of the whole work. One just cannot run any efficient organisation, and certainly not any court system, where one-quarter of the judges are temporary; that is, one where they are here one day, gone the next or here one week and not available the next. That is an impossible situation.
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It seems to me that the use of temporaries in judicial office, and also in the Crown Office as advocate deputes, has reached the stage where the quantity of use is reducing the efficiency of the courts.
6 p.m.
Lord Alexander of Weedon: My Lords, as one would expect, the ground in this debate has by now been very well covered. My sole reason for speaking today is that I should like to say a few words from the perspective of someone who was, until very recently, at the practising Bar. I entirely agree that there should be a retiring age for judges and that that age should be 70. I could not attempt to improve on the reasons for that, given so eloquently by the noble and learned Lord the Lord Chief Justice in his maiden speech.
However, I should just like to put down a marker for the future. The noble Lord, Lord Mishcon, suggested that perhaps, ultimately, the retirement age should be 65. The Bar Council has also made that suggestion. In the course of 25 years of practice at the Bar, I have appeared before some great judges, many good judges and only a very few who were less than good. But those who were less than good were so by reasons of ability or temperament. They were less than good before they reached the age of 65 and they became no better, but no worse, between the ages of 65 and 70. Equally, I never found that a good judge before the age of 65 became less impressive to appear before between the ages of 65 and 70. Therefore, I warmly applaud the decision of my noble and learned friend the Lord Chancellor not to go below the age of 70.
Having said that, perhaps I may express my own concern, and one that has been expressed by a number of judges who have spoken, about the provision in Clause 25 which permits judges to be reappointed after the age of 70 on a temporary basis. My first point is a simple and constitutional one: if the reasons for retirement at the age of 70 are right constitutionally, then I think that they are probably right for all judges. I understand the pragmatic difficulties that lead to the need sometimes for the Master of the Rolls —and, indeed, the other Heads of Divisions—gratefully to draw on those who have retired. But I think that that is undesirable in principle.
If there are to be such arrangements, I understand that my noble and learned friend the Lord Chancellor would seek to formalise them. However, I believe that the very nature of the formality involved shows the weakness in the system. I say that because, from the perception of the Bar, we well know that many cases involve judges sitting where the state is a party. This is true of all criminal cases, many civil cases and, notably, cases of judicial review of the kind that have been cited by earlier speakers in the debate. It is possible that in some of those cases the Government will succeed and the claimant, or the defendant in the criminal case, will lose.
Disappointed litigants are not always rational. Their perception is important. I believe that we should seek to avoid a perception where it can be said in any quarter that there is even a risk that a judge's summing-up or a judge's decision would be affected by

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the potential that he or she would wish to seek to serve on the Bench. Therefore, I would go either for an absolute embargo or for a provision of the kind mentioned by the noble and learned Lord the Lord Chief Justice where any appointment over the age of 70 was made by the Head of Division, after consultation with the Lord Chancellor. I believe that that would enshrine continuing judicial independence.
I turn now to what seems to me to be the compression factor in the Bill. Most of us are agreed that there should be a retirement age of 70. But, if that is right, what impact does the 20-year provision have? I believe that it is a cause of considerable concern. For many years stipendiary magistrates and, I believe I am right in saying, Masters of the Supreme Court have had to serve 20 years before retirement. In practice, that has meant that they sought to be appointed before they reached the age of 50. In some cases, when appearing before them in their latter years, one had the distinct impression that it was just conceivable that they might be soldiering on in order to earn their pension.
It is immensely important—and I was very glad to hear my noble and learned friend the Lord Chancellor state this—that many who go to the Bench should be mature and experienced. I add to that statement that it is also important that the Bar should not be denuded of talent too young. In recent years, the average age of judicial appointment has been 50 or slightly over. The parameters for appointment are, generally speaking, between perhaps 45 and 55 for the most part, although I appreciate that there are exceptions. If the average age is 50, that means that many will be appointed over the age of 50 and that none of those will have the opportunity of earning a full judicial pension. Quite simply, I believe that that is unfair to our judiciary. Either we push the age limit down so that judges are almost invariably appointed at under 50, which I believe to be undesirable, or we deprive them under the Bill of the opportunity of earning a full pension. I ask my noble and learned friend to reconsider very carefully whether that choice is a desirable one.
I do not wish to speak of the quantum of the pension. But the noble and learned Lord, Lord Ackner, has given signals, perhaps, of battles yet to come in Committee. I very much hope that, on an issue as important to the public as the pensions of the judiciary and their terms of service, any battles which can properly be avoided will be avoided. I respectfully echo the suggestions made by the noble Lord, Lord Benson, and the noble and learned Lord, Lord Ackner, that it would be highly desirable if this Chamber in Committee had the benefit of the comments on the Bill of the Top Salaries Review Body and of an independent actuary. That would ensure that there is fairness to the public purse and it would also ensure that there is fairness to the judiciary.
I make no apology at this time for speaking about fairness to the judiciary. From practising at the Bar, I know what an onerous and difficult task it is to be a judge. There have been many criticisms of the judiciary over recent years in connection with cases of miscarriages of justice which have caused public disquiet. Most criticisms of the judiciary have, in my
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view, been misguided. The judiciary is not responsible for the quality of police evidence; it is not responsible for the verdict of the jury; and it is not responsible for the statutory system within which appeals are conducted.
I state this because I believe that this is a time when it is particularly important that we should hold the position of the judiciary in respect and hold its rights in balance. In order to do so, I believe that it would be fair to all involved if the proposal for an independent inquiry was to be considered, rather than there being a debate in Committee, conducted, no doubt, with the usual amity that prevails in such exchanges, which might have the effect of suggesting that there was real and continuing disquiet about whether the Government were providing properly for the judiciary. Therefore, I urge my noble and learned friend to consider putting before the Chamber in Committee some objective assessment of that kind so that all our considerations may be better informed.
6.10 p.m.
Lord Bridge of Harwich: My Lords, I hesitated as to whether to speak in this debate, but I am delighted that I decided to do so if only because of the privilege it gives me of expressing the pleasure I had in listening to the maiden speech of my noble and learned friend the Lord Chief Justice. His appointment to that great office was universally welcomed by the legal profession in the knowledge of the outstanding talents he would bring to it. I have no doubt that your Lordships' House will cordially endorse that welcome in the knowledge of the outstanding contribution that he will make to debates in the House.
Having said that, I have to say that I am not entirely in step with him on all the points he made, or indeed with what appears to be the view of the majority of your Lordships. We live in an ageing society where the number of unproductive persons living on pensions becomes greater in proportion to those productive workers who have to support them. We live in an increasingly litigious society, where the number of judges required to perform judicial functions is constantly increasing. When I was first called to the Bar I think there were nine Lords Justices in the Court of Appeal; now there are 27 or 28. The pressure, as my noble and learned friend the Master of the Rolls has said, is continually growing.
In these circumstances can we not stop for a moment to question the wisdom of limiting the overall pool of those from whom persons to perform the judicial function must be drawn by reference exclusively to the date on their birth certificates without reference at all to their competence to perform the office? I question here too—I think in agreement with most of your Lordships—the possible combined effects of a retiring age of 70 and a minimum period of 20 years in order to earn a full pension on the availability of suitable candidates willing to accept appointment to the judiciary.
If we are to have a normal retiring age of 70 for all the judiciary, including the higher judiciary, then I, in contrast with some of the rest of your Lordships, welcome the power in the Bill to extend that tenure of

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office from year to year until the age of 75, although I share the doubts expressed by my noble and learned friend the Master of the Rolls as to whether that power to extend should be exercised solely by the Lord Chancellor rather than, as my noble and learned friend suggested, by the designated judges in consultation with the Lord Chancellor.
I do not share the constitutional doubts raised by my noble and learned friend Lord Ackner. But then I very rarely share his perennial suspicion that any measure introduced by this Government conceals some sinister bureaucratic plot to undermine the independence of the judiciary. The answer surely to any constitutional objection to a power to extend a judge's service beyond the retiring age of 70 is that given by my noble and learned friend Lord Donaldson —that if done by the regular members of the judiciary, before designated judges in consultation with the Lord Chancellor, the constitutional objection disappears.
That brings me to the final point, of which I speak with the utmost diffidence for obvious reasons—the absolute disqualification of those over 75. As your Lordships will appreciate, I think I am the one speaker who will be immediately affected by it when it becomes law. While I appreciate that this reflects a public perception which has been much promulgated by the media—it may well provoke another broadside—I shall risk that in order to make three points on the subject. The first point has already been made but in a different sense from the sense in which I make it. Since the retiring age of 75 was introduced in 1959, both the Court of Appeal and the House of Lords have frequently called on the services of retired judges, retired Law Lords and retired Lords Justices often well beyond the age of 75 to fill the gaps that inevitably occur. The volume of appellate work in the Court of Appeal or the House of Lords fluctuates and from time to time it is necessary to call on somebody for a week here or there to fill a gap. Does it really make economic or any other sort of sense to insist that there shall always be a sufficient full-time judiciary in the Court of Appeal and in the House of Lords to avoid any such gaps ever arising? In my submission, it does not.
The second point I make is that of course no one should be qualified to sit after 75, even on an occasional basis, unless he is invited to do so, and the power to issue the invitation should rest with whatever authority has the power to extend a judge's service from 70 to 75.
Thirdly, and finally, I cannot resist making this point. Throughout the 19th century and most of this century some of the most outstanding judges who have sat in the Court of Appeal and as Law Lords in your Lordships' House have made some of their finest and most mature contributions to English jurisprudence after they passed the age of 75. If that has been so in the past why should it not continue to be so in the present?
6.16 p.m.
Lord McCloskey: My Lords, some of your Lordships may recall the television sketch in which John Cleese, clad in his wig and gown, stands up before the court and says to the judge:
"My Lord, my learned friend appears for the plaintiff and I appear for the money".
Tonight I must declare an interest in the Bill because I am or am likely to be a person holding qualified judicial office on the appointed day, whenever the appointed day may be. But I am not in the least concerned about the money. I, like all existing judges, signed up for the existing provisions. We must have found them satisfactory when we signed and we cannot cavil at them now. The new provisions are certainly for us no less satisfactory. Indeed, in so far as we are given an option, they are beneficial to us and we ought to acknowledge that.
I should like to join with most of your Lordships who have spoken in drawing attention to the interaction of Clause 3, which prescribes a 20-year qualifying period for the full pension, and Clause 25, which introduces the compulsory retiring age of 70. Inevitably the optimum age to become a judge is on one's 50th birthday. I think that that is obviously so because if one goes on the Bench later one will get a smaller pension; if one goes on earlier one is likely to suffer the loss of earnings at the Bar which are likely to be at their greatest at that particular time. Also some people are reluctant to go on the Bench for the reason that I was reluctant to go on the Bench in my 40s, when I felt that I would be putting one foot in the grave, so to speak. I thought that that was a drastic step to take at such a young age. My guess however is that the average age will settle down at something in the mid to late 40s.
The noble and learned Lord, Lord Morton of Shuna, has drawn attention to the age of some of us. I went on the Bench at the age of 55, but the noble and learned Lord the Lord Chancellor who sits with us tonight went on the Bench, I think, at the age of 57. The noble and learned Lord, Lord Morton of Shuna, was 58 and the last but one Lord Advocate, the noble and learned Lord, Lord Cameron of Lochbroom, went on the Bench also at the age of 58. So when one thinks of judges having to retire at the age of 70, all these judges would qualify for substantially less than the full pension, which by contrast with other countries is not very great.
There is also a notable sub-effect and that applies to the Law Officers, as mentioned by the noble and learned Lord, Lord Morton of Shuna. Most of the Law Officers who have ascended to the Bench in Scotland have been well over 50. Are we then to envisage that all Law Officers will in effect retire from that particular post by about or indeed before the age of 50?
There has been some talk in the debate of judges becoming impatient, bad tempered, remote or out of touch with contemporary mores simply by reason of advancing age. That may be a possible effect of advancing age, but in my experience a much more potent cause of remoteness, arrogance and ill temper among the judiciary is the length of time that the

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person has served on the Bench. The longer one is there the more remote one becomes from the struggle in which one was previously engaged. The overall effect of Clauses 3 and 25 is to encourage judges to stay on the Bench for 20 years. I deplore them for that reason.
If we have to work in round figures, I suggest that the best balance is to make the accrual period 15 years, as it is at present, and the compulsory retiring age 70. There is no need to go for round figures. We have had the example of New Zealand. I am sure that we can find others elsewhere. We could pick the best period—somewhere between 15 and 20 years is a possibility—and the ideal age, regardless of whether it is a round figure.
An entirely separate reason for questioning the wisdom of the whole thrust of the Bill is that it moves us stealthily towards the creation of a kind of career judiciary. That runs counter to our tradition. There may be good reasons—I do not know of them—for moving towards a career judiciary, but I am opposed to such a move as a mere by-product of a Bill which is intended to remove anomalies and anachronisms from existing pension provisions. Like others, I am interested to know what Clause 25 means. I do not like to see Ministers having the power to select judges. I want to endorse the point made by my noble and learned friend Lord Morton of Shuna that the Secretary of State for Scotland is an important litigant in Scotland. He is a litigant before me next week in the Appeal Court. He frequently litigates in our courts. It is not right that he should have the power, equivalent to the power exercised by the Lord Chancellor for England and Wales. I hope that that point will be looked at. I endorse the recommendation of my noble and learned friend Lord Morton of Shuna in that regard.
There are two points about which I wish to ask the noble and learned Lord the Lord Chancellor of which I have given him notice. The first is that under Clause 1 the Minister may prescribe the period of time during which a currently serving judge may elect between the existing and the new provisions. How long a period do Her Majesty's Government have in mind to allow such an election, and why does any period need to be laid down? Why should not the existing judiciary merely be given the right to elect in the light of their personal, financial and family circumstances at any time while they continue to serve?
Finally, Clause 31(2) contains the commencement provisions. I wonder when the provisions which affect the aggregation of pension entitlement for those who have moved from one judicial office to another are likely to be brought into force. Those are matters of detail, but I hope that the Government will think again about the main thrust of the two clauses to which I have referred and the overall effect of the Bill.
6.23 p.m.
The Lord Chancellor: My Lords, I should like to say how much I enjoyed the maiden speech of my noble and learned friend the Lord Chief Justice and to congratulate him upon it. Like others who have, spoken, I am delighted that he thought it right to
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express his view. I am pleased that his view on the matters about which he spoke should have been available in this way to your Lordships. I am sorry that I did not have an opportunity to have some discussions with my noble and learned friend Lord Hailsham before he spoke. I should have liked to have learnt why the anomalies of the present system have continued for so long. No doubt there is an answer to that question which will be forthcoming in due course.
Many of your Lordships have spoken about the 15-year accrual period. It is obvious that, taken by itself, moving from 15 years to 20 years is not helpful. One does not need to be especially perspicacious to discern that fact. But I have to take issue with the noble Lord, Lord Mishcon, in his reference to what I said. I said that the judges' pension system will have to take account of the general tax position. The general tax position is that the scheme should require an accrual system which is not more rapid than 20 years to benefit from the present pension scheme regime. It is extremely difficult to suggest that the judiciary as a whole should be in a special position relative to that. Of course the judicial pension scheme is intended to apply especially to the judiciary and to cater for its needs in the way in which, in my submission, it has; but one has to think about it against a background of the tax structure.
I have sought to ensure that the judicial pension scheme has features which make it proper and possible for it to enjoy the tax-free treatment which is available within the general law. That, as I sought to explain in my opening, is why we have two schemes; including a top-up scheme when one comes above the cap. My noble and learned friend Lord Morton of Shuna has referred to the elegant language of Clause 19 in which the draftsman has sought to refer to the cap. The idea is clear enough. If one is above the cap, there will be a separate scheme in respect of that part of the salary which is above the cap. If my noble and learned friend will allow me, I shall invite the draftsman to comment upon his comments to see whether an improved formulation can be put forward. That is the crucial reason why the 20-year accrual period has been arrived at.
I want to point out an important factor about which the noble Lord, Lord Wigoder, asked me: the retained benefits. My noble and learned friend the Lord Chief Justice of course understood the position about them and commented as to why they would not be of particular advantage in every possible circumstance. The question is: what does one do about it? One cannot have all sorts of specialties, and this is a special provision for this scheme. It allows retained benefits. The effect of that is that a person who contributes for a pension under the self-employed arrangement will have that pension in addition to the pension provided under the judicial scheme. The 15-year accrual period has been in existence for High Court judges for a long time, as has been pointed out. But the background against which it exists now is different from that against which it was originally set up. We have to take account of the general taxation system.

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So far as I am aware, there is no pension scheme allowed for tax purposes which accrues at anything like the rate which is proposed in the Bill for the judicial scheme which allows the retained benefits to be added to the judicial pension. That is how the judicial scheme that I propose fits in with our desire to have mature people on the Bench. If we have mature people at the top of their practice at the Bar, they will be able fully to subscribe to a personal pension plan which will more than compensate in respect of any loss of years in the judicial system. If that is a good idea, it will mean that people will increasingly be able, without any detriment to their financial position, to continue in practice and then take not the fully accrued judicial pension but the proportion of it appropriate to their time in office.
Your Lordships have stressed that 15 years is better than 20 for an accrual rate. I understand that. However, noble Lords have not yet directed their attention to whether there is a good case for differentiating the tax treatment of judges from that of all other people, in particular whether the provision in the Bill for special tax treatment for judges on the lines I have described is the most suitable that can be devised.
We shall obviously have discussions in Committee about the detail of the Bill and I shall see what I can do to produce helpful assessments of these matters. The information I have about other schemes is detailed and is more appropriate for Committee than for me to deal with it here.
However, I am at least as devoted as my noble and learned friend Lord McCluskey to the system that we have for appointing the judiciary. There is no intention on my part to create the conditions for a career judiciary in the sense in which he described them. But it is most important to have a reasonably just arrangement for passing, for example, from the circuit Bench to the High Court Bench. I am extremely grateful to all noble Lords for their observations on this in the debate, but they did not deal specifically with the relationship between the judicial pension system for the High Court and the circuit Bench on the one hand and for lower judicial officers on the other. These matters are important because the more distinction there is at different levels the more difficult it is to have a degree of flexibility between them. I hope that your Lordships will consider it perfectly reasonable to encourage good district judges to become circuit judges and so on without in any way committing oneself to a completely career judiciary in -Which people do not start in the ordinary practice of the legal profession.
My noble and learned friend Lord McCluskey asked me two questions which I shall try to answer. The first is on the time of the election. The Top Salaries Review Body in its comments on the consultation paper suggested that flexibility should be introduced. I propose that the regulations should allow the existing judiciary to decide at the time when the benefits are in issue—that is, at retirement. I
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believe that that is the longest possible time envisaged. That was announced in the Government's response to the consultation paper in paragraph 19.
The second question was when aggregation should be allowed to start. The answer is as soon as the provisions of the Bill become law and can reasonably be commenced. I should like some time for the detailed regulations to be made, but subject to consideration of the circumstances I should wish to see the Bill come into force as soon as possible.
Before leaving this part of my observations, perhaps I may also answer a question raised by the noble Lord, Lord Mishcon, about the remuneration of retired circuit judges. It has nothing directly to do with the Bill but nevertheless is an important question. Circuit judges who retire are sometimes invited and are entitled to sit as deputies. They used to be in the class C fee structure which is based on the salary of a district judge. In the course of discussion with the Council of Her Majesty's Circuit Judges, we have agreed that the fees should be increased appropriately, based on the salary of a circuit judge. Many of these part-time fees must be looked at and I have tried to set up a reasonably consistent system. It may take a little time for the arrangements to be put in place, but in principle we agree to the point made by the circuit judges.
I turn from the pension aspect to retirement, on which there is a variety of views. I shall not try to summarise them. First, there is general agreement that a retirement age of 70 is appropriate. Some ask, "Well, if that is so, should it not be absolute?". I can see the force of that argument. In other words, there should be no exceptions. Circuit judges are required to retire at 72 or at the end of the year of service in which they attain the age of 72, subject to a power vested in the Lord Chancellor for them to continue in office. I have exercised that power from time to time, after consultation with the presiding judges. It has worked reasonably well. I have had no complaints about the power being exercised in any way other than properly. It occurred to me therefore that when moving the age from 75 to 70, the period between 70 and 75 might be covered with a similar power. That is the origin of the proposal.
I have carefully considered exactly what the arrangements should be before putting forward the proposals in the Bill. Judges in the higher court and above, including the House of Lords, may be removed during their term of office only by resolution of both Houses of Parliament. I felt that the proper constitutional arrangement was that the responsibility for exercising the power, if it were to exist, should be in someone answerable to Parliament for its exercise.
Of course it would be the practice of the Lord Chancellor and, I am sure, also of the Secretary of State to consult the relevant judges. It is not quite so easy to see, for example, who the appropriate judges would be to consult in the case of the possibility of extending the term of office of a Lord of Appeal in Ordinary. There are difficulties about that and I am open to consider the matter further.
However, it is important that if the power is to exist it should be used by someone who is accountable to

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Parliament for its exercise. An improper exercise of any such power would in any event be amenable to judicial review. These are matters to be considered in Committee. Unanimity has not characterised this aspect of the speeches.
As to whether judges should sit beyond the age of 75, I appreciate the views expressed that many great judgments have been given by those who were more than 75. A balance has to be struck on whether one should forgo that possibility in the future against the relative certainty of the age of 75. I agree that it is not absolutely necessary to have such a power. The policy could be used to reach the same result. I feel that in a matter as important as this it is right that the policy should be exposed to Parliament. Parliament should ultimately decide it.
The contributions which have been made show that we shall have lively discussions in Committee. It is reasonably clear that, as has been pointed out to me, there are two distinct thrusts in the Bill. One is to reduce the retirement age; the other has the effect of increasing the period of minimum accrual for pensions. I thought it was right that the two should be considered together because it would be most unfortunate to have a separate consideration of them. The system must be considered as a whole. The pension arrangements are part of the overall remuneration arrangements for judges. I am strongly persuaded that the motivation of those who accept appointments to the High Court in this country is not a desire for financial improvement. Obviously the terms are important to them but many of those who are appointed to the High Court forgo considerable earnings in private practice. In my experience those who are appointed to the High Court consider that an honour to be sought after.
My noble and learned friend Lord Hailsham, with his great experience, pointed out that this is a matter which needs to be considered. This Bill certainly has been considered. I have consulted on both the pension and the retirement aspects. Your Lordships will have an opportunity of considering all these matters in due course in Committee, as I am persuaded that your Lordships are willing that this Bill should have a Second Reading, the Motion for which I now renew.
Lord Ackner: My Lords, before my noble and learned friend sits down, I hope he will be kind enough to answer the question I specifically raised. Were the views of an independent consultant actuary obtained on the scheme as now put forward by the House, and if so may we know what those views are?
The Lord Chancellor: My Lords, I have already sought to answer that in my observations. I am not persuaded that I am in a position to put particularly useful views of an independent actuary before your Lordships. However, I shall certainly consider that matter carefully before the Committee Stage.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Intestacy: Law Commission Report
6.41 p.m.
Lord Mishcon Lord Mishcon rose to ask Her Majesty's Government what action they intend to take in the light of the recommendations in the Law Commission report on intestacy (House of Commons Paper 60, Session 1989–90).
The noble Lord said: My Lords, I trust that your Lordships will consider that this Unstarred Question relating to a report of the Law Commission laid before Parliament by the noble and learned Lord the Lord Chancellor and published sonic two and a half years ago deals with a matter of common interest and public importance. It is all about our laws of intestacy and about who benefits from the estate of a person who dies without having made a valid will and what principles should apply in this day and age, having regard to today's social conditions and mores, to the distribution of an intestate's estate.
The last such review was carried out by the Morton Committee in 1951 and there has been much social change over the intervening 40 years. Most usefully, the commission published a working paper in July 1988 and consulted widely on it, and even more sensibly—if I may say so in a matter of this kind—the commission saw there was a survey of public opinion. That was undertaken in December 1988.
Rather than dealing with all the contingencies that can occur with surviving members of what can loosely be called the family, I propose to deal solely with the present law of intestacy where there is a surviving spouse and especially where there are also surviving children of the intestate. That is often the most worrying situation as the law now stands. I remind your Lordships that the current law states that in that event the surviving spouse will receive what is called a statutory legacy of £75,000, the deceased's personal chattels—that broadly means furniture and effects in the home, items of jewellery and items of that kind —and a life interest in half the remainder of the estate. The other half of that residue is shared among the issue. I use the word "issue" because grandchildren take the share of a child who had predeceased the intestate.
Where there are no issue but there are parents or siblings of the whole blood (or their issue) who survive, the spouse will receive a statutory legacy of £125,000, the personal chattels to which I have previously referred and one half of the remainder absolutely, the other half going to the parents of the deceased, or if no parents survive, to the siblings of the whole blood or their issue. If there are no issue, parents or siblings of the whole blood (or their issue), the spouse takes all.
The statutory legacy going to the widow or widower is updated from time to time by statutory instrument and the revised figures apply to deaths taking place after the statutory instrument comes into force. These statutory legacies have been uprated in 1972, 1977, 1981 and 1987. Possibly the first thing your Lordships will have noticed is that in all this

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there is no provision whatsoever for the matrimonial home as such to go to the surviving spouse even when minor children are involved.
The statutory legacy to the widow of £75,000 may be quite insufficient of itself to acquire the matrimonial home, quite apart from there being no sum left over to maintain it and the family. If the property happens to be held on a joint tenancy, which means that the survivor automatically inherits the property, or on a tenancy in common, where the surviving spouse has an interest in equity, the position of the surviving spouse is of course much more advantageous, but people who are old today may not have realised all this when the matrimonial home was purchased possibly very many years ago and when the custom was to have the home in the sole name of the husband. So we start off with one unfairness, but in these days, even with the current depreciation of property values, the value of a home is incalculably greater than when these rules were first thought of in the early 1920s. Also, one can of course have vastly different values of exactly the same type of house in different areas of the same county, let alone different areas of the same country.
All this has meant that with such reasoning, and furthermore after reflecting upon the unsatisfactory procedure of having to deal with increases spasmodically made by statutory instrument as well as having to take the value of the house not at the date of that instrument but at the date of actual appropriation of the house, which is another unsatisfactory ingredient, the commission has arrived at a recommendation that, in all instances where there is a surviving spouse, and irrespective of whether or not there is issue, the whole estate of the intestate should go to the surviving spouse.
I do not propose in the time at my disposal, if I limit it to civilised standards, to go into the recommendations that the hotchpotch of statutory rules affecting issue and affecting issue and spouses upon partial intestacy should be repealed, except to say that in my humble opinion those recommendations are correct. I am, however, unhappy, as are many members of the legal profession and those familiar with family problems, about the commission's unqualified recommendation that a surviving spouse gets all even where there are children of the intestate surviving. I appreciate to the full the desire of the commission that intestacy rules should be certain, clear and simple both to understand and to operate. But if that is liable to produce too many hard cases, it makes bad law. As a practising solicitor, I do not accept the suggestion which the report contains to the effect that there is a ready remedy where children are dependants of the deceased, in that they can, either themselves or someone can do so on their behalf, make an application under the Inheritance (Provision for Family and Dependants) Act 1975, under which a dependant may apply to the court for an award out of an estate.
Of course such an application can be made but that presupposes the ability and willingness to litigate and does not take into account the detriment to family
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relationships which can so often result from any such application to the court. I am particularly worried about the effect of those recommendations of the commission—the difficulties are frankly recognised in the report—where there are second or subsequent marriages, the previous ones having been determined by death or, much more likely these days, by divorce, and there are children of the deceased by a prior marriage. Indeed, we learn from the report that the majority of the respondents in the public opinion survey took the view that in such cases the spouses should be treated differently. However, the commission felt that the intestacy rules should not give issue of former marriages any rights upon intestacy other than those which might be established by an application to the court under the 1975 Act, to which I referred.
I repeat that I am very unhappy about this matter and so, among others, is the appropriate committee of the Law Society and the Bar's Law Reform Committee. In its view and, if I may say so, in my own, better justice would be done by recommending that, where the deceased left a spouse but no children, the surviving spouse should get the whole estate; but where there are children, different considerations should apply. For example, the well-known organisation Justice has made a recommendation which certainly deserves close consideration. It is that the surviving spouse should, where there are also surviving issue, be entitled for his or her life to the intestate's interest in the matrimonial home, the income from any proceeds of sale, a statutory index-linked legacy and one half of the residue. The other half of the residue should go to all surviving children of the intestate in equal shares, wherever there has been a previous marriage.
As the noble Lord, Lord Meston, may well say—perhaps I may so prophecy—the Bar's Law Reform Committee goes further than that in its recommendation. It suggests that if the estate is large enough, the rights of the children of the intestate to benefit should not depend on some of the children being children of a previous marriage. Furthermore, that committee supports Justice's proposal that a surviving spouse should have the right at any stage to apply, under the Inheritance (Provision for Family and Dependants) Act 1975, for payment to him or her of capital out of the proceeds of sale of the matrimonial home.
The need to provide for children of past marriages may not have been much of a problem in 1922 among the sections of our society which are perhaps particularly vulnerable on an intestacy. The number of divorces in all sections of society some 70 years on makes a very different situation. The same considerations of social change, whether we like it or not, pertain to cohabitants, people who have lived together as husband and wife without entering into the formal marriage state. What of them upon intestacy?
At present the intestacy rules only provide for Current spouses and blood relations. Cohabitants can only make a claim against an intestate's estate under the Inheritance (Provision for Family and Dependants) Act 1975, where they can satisfy the court that they were dependent on the deceased. That

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often produces great hardship in that a cohabitant could have made a very meaningful contribution to family life but has not in fact been a dependant. In such a case there is no provision for that survivor either under the intestacy rules or the 1975 Act. I do not have to tell your Lordships of the very significant number of such households which now exist in our society.
For its part the Law Commission recommends that cohabitants should be provided for outside the intestacy rules and under the 1975 Act. They should be able to apply under that Act for reasonable provision without having to show dependence. The definition of "cohabitant" obviously poses some problems when contained in a statute; but we managed in Parliament to draw up a definition, in the Fatal Accidents Act 1976, which is as good as we are likely to get. The commission recommends that that definition should be adopted in the suggested extension of the provisions of the 1975 Act.
I note that the Wills and Equity Committee of the Law Society agreed with those proposals, provided that they only applied on an intestacy, but it still expressed concern that the interests of the deceased's children should be protected. The Family Law Committee of the society is, however, reviewing the entire legal position of cohabitants with a view to producing recommendations for law reform in that context. I am sure that when they are made, the noble and learned Lord the Lord Chancellor, as he always does, will give them his very careful consideration.
Finally, I deal with what happens under the present law when there is no surviving spouse, no issue and no eligible relatives. In those circumstances the intestate's estate is dignified by the term "bona vacantia" and goes to the Crown. The public opinion survey produced a majority view that it should instead go to charity. Indeed, 60 per cent. were in favour of charity receiving the property and only 17 per cent. supported the existing position. However, the commission, together with many of those whom they consulted, found difficulties in so altering the law, because of the problem of choosing the charity or charities to benefit, and because the Crown is able to make ex gratia payments in deserving cases whereas a charity would not be equipped to do that or indeed to administer the estate or satisfactorily meet a situation in which a relative entitled to benefit was eventually found.
Those problems might have applied and indeed did apply when the commission prepared its report. But that was before the Millennium Fund and the national lottery arose upon our national horizon. I ask for due consideration to be given by the noble and learned Lord the Lord Chancellor and his colleagues in the Government to the idea that bona vacantia in future should vest in those who will administer the national funds for charity and the arts pursuant to the Conservative manifesto placed before the electorate at the general election. I suggest that the same procedures and discretion, and the ability to create a reserve fund, could be dealt with in the same way as it is at present by the Treasury Solicitor. National good
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causes could be the ultimate beneficiary of bona vacantia, to the delight, I am sure, of a certain new and ebullient Secretary of State.
7 p.m.
Lord Meston: My Lords, we are most grateful to the noble Lord, Lord Mishcon, for bringing this question to the attention of the House. I look forward to learning the Government's response to the Law Commission's Report which is now two-and-a-half years old. I look forward to learning whether the Government disagree with any or all of the recommendations of the report and whether any future changes can be expected.
The Law Commission identified areas for reform. Those were most helpfully summarised by the noble Lord, Lord Mishcon. In particular it identified the unsatisfactory features of the present law. It analysed the need for reform and produced a variety of possible solutions. For the most part, the reasoning of the report is compelling. It gives first consideration to the need for intestacy rules to be clear and simple, both to understand and to operate. The report also recognised that any fixed intestacy rules are likely to be described as arbitrary, applying as they must to a multitude of different situations.
The fact is that just as people make wills for many reasons, a large number of others fail to make wills for many reasons including ignorance, indolence, superstition and an optimism that they will live forever. Bentham called the power of making a will,
"an instrument placed in the hands of individuals for the prevention of private calamity".
It must be said that good intestacy rules will mitigate private calamities. Those are described in paragraph 5 of the report as,
"a safety-net for those who have, or think they have, little to leave, or who have not thought about it, or who die prematurely".
However, as the noble Lord, Lord Mishcon, observed, the safety net is not there for the reluctant testator who does not get round to it. It is a safety net for those he leaves behind.
On balance I welcome the main change proposed by the report, away from the complexity of life interests and statutory trusts and in favour of surviving spouses. My observation in practice is that the present rules can unduly restrict the widowed mother of young children who generally can be expected to act reasonably and responsibly in the interests of her children. If she wishes to adjust the position produced by a will or by intestacy to give her more flexibility under the present law, she has to resort to litigation. Legal costs inevitably reduce the size of the estate, and the children have to be separately represented in a potentially adversarial situation as against their own mother.
My only misgiving—it was referred to by the noble Lord, Lord Mishcon—is that there is no mechanism to protect for the children any part of the estate leaving the control of an irresponsible or vulnerable mother. I say "mother"; it could just as well be "father". The report offers no solution to that.

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Solutions are not easy to find although I am pleased to hear that the Law Reform Committee of the Bar Council suggested some solution, as did Justice.
The noble Lord, Lord Mishcon, touched on another problem with which I have become familiar in practice, in particular under Inheritance Act claims. It is the difficult balance that has to be struck between the elderly widow after a second marriage who may well have given up her home and a pension to marry relatively late in life against the reasonable expectations of the adult children of the deceased's former marriage who can also expect to receive something from the estate which will probably have been built up in the lifetime of their parents. It is a difficult balance to strike. Whereas in those situations the Inheritance Act can come into play to correct the situation, the Inheritance Act does not come into play to correct the position where there are young children, as the noble Lord, Lord Mishcon, said. If the surviving parent recovers everything, who will protect the interests of the young children and advance their claim under the Inheritance Act—a claim that has to be made prima facie within six months of death? It is a difficult situation. I wonder whether the Law Commission may have gone too far in that respect.
The report recognises that surviving spouses may always be said to deserve rather more or less depending on the length and happiness of the marriage. Paragraph 39 of the report deals with the estranged husband or wife who might receive an undeserved windfall. It states:
"If separated spouses have chosen to leave their marriages intact then the intestacy rules should treat their marriages in a similar fashion to any other marriage".
It states that the answer is either to make a will or to obtain a decree of judicial separation. That rather begs the question of whether in this situation the intestacy rules provide an appropriate safety net.
Lawyers are well used to picking up the pieces. But it can be extremely irritating to be told, in support of some complicated re-arrangement of an estate, "It is what he would have wanted", or, "It is not what he would have wanted". One is always tempted to respond, "Why on earth, and while on earth, did he not arrange what he wanted when he could?" I suppose that if people were so sensible we would be out of a job.
It is important to consider in the context of the report whether our present intestacy rules provide an appropriate modern safety net. As the noble Lord, Lord Mishcon, observed, there is the further safety net of the 1975 Act.
That takes me finally to the second main recommendation: the addition of cohabitants to the list of claimants under that Act. That is welcome. The present Section 1(1) (e) of the 1975 Act can include the undeserving and exclude the deserving; that is, people who have been left behind who made considerable sacrifices without falling within the somewhat convoluted provisions of Section 1(1) (e). The litigation thrown up by that section has not been very satisfactory. It involves a complicated analysis of evidence based on one side of the story.
It is pleasing that in that respect the Law
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Commission has developed its thinking since the 1975 Act. During its consideration as a Bill amendments were put forward in another place along the lines of the proposals by the Law Commission. Those amendments were rejected by the government of the day as outside the Long Title of the Bill. One of the leading textbooks described that process as follows:
"The survival of the Law Commission's draft Section 1(1) (e) into enacted statute is due to excessive subservience paid by the Bill's promoters in Parliament to the Law Commission".
I hope that the Government will bring some of those changes before Parliament before too long and that we shall not be excessively subservient, although respectful as always, to anything produced by the Law Commission.
I wish to raise one final point. If legislation is to be brought before Parliament within the foreseeable future, is it expected that it will cover Scotland as well as England and Wales? I am unable to find out how the Scottish Law Commission's consideration has progressed although I know that it has been considering the same topics.
7.9 p.m.
The Lord Chancellor: My Lords, I wish to thank the noble Lord, Lord Mishcon, very warmly for the opportunity to discuss this Question.
I believe prima facie that when the Law Commission has considered an issue with the great care that it has brought to this issue, unless there is some good reason against it, the policy which it recommends—since it is in an area for which I have responsibility—should prevail.
In other departmental areas there are other possible policies which the Law Commission might not have had in mind. However, in this case there is no overriding policy that would not be apparent to the Law Commission. Therefore, I approach the matter with the feeling that, first, the Law Commission has identified a problem. Most people are agreed that the law of intestacy has not kept up with the demands being made upon it as a result of the changes in social conditions and so forth, referred to by the noble Lord, Lord Mishcon, and the Law Commission.
That would be my normal approach to the matter. However, there are some problems with the Law Commission's proposals, particularly in relation to issue of the intestate by an earlier marriage or by a marriage still subsisting at his death. It is not easy to see how to provide for such issue without some machinery such as a continuing trust in respect of, in particular, the matrimonial home. The other difficulty is to be fair as between the different types of arrangement.
I am grateful for your Lordships' views because as yet I have not been able to reach a concluded view as to the wisest course to pursue. The courses suggested by Justice and brought a little further by the Law Reform Committee of the Bar would require the preparation of a fairly detailed scheme to be put into legislation. I am not sure whether I should try to embark on such a course in the department without help.

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I am also well aware of the fact that the Law Commission considered such difficulties. It thought, "You can't legislate for everything—that is impossible. The best thing to do is to give the whole estate to the widow. That will be clear and everyone will know that if they do nothing and die without making a will that is what will happen. Therefore, perhaps there will be a spur on them—assuming that they have notice of their mortality—to do something about the situation if they wish." That is an attractive line to take: I wonder where the balance lies.
I wish to mention the subsidiary matters referred to by the Law Commission. Like the noble Lord, Lord Mishcon, I do not believe that it is necessary to comment upon them, except that which relates to those who cohabit. The other matters are technical and whatever the legislation was the rules could be included without difficulty. As regards the cohabitants, the proposals do not appear to be controversial to any substantial extent. Although some people might regard them as controversial I do not believe that any substantial amount has yet been generated. The main proposal lies in a different category.
There is also a statutory power to raise the legacy; the Lord Chancellor has the power to do that. In a sense one goes a certain distance towards the Law Commission's approach by raising the statutory legacy fairly substantially so that it will affect many people in such a way as to carry all the estate. However, I have been reluctant to do so until I can reach a firm conclusion about what is a wise course to take in relation to the Law Commission. I take the sense of what your Lordships have said as being against legislating the Law Commission's scheme and in favour of a more elaborate proposal. If that is so we shall have to leave the matter over. A wise course might be to take an interim measure raising the statutory legacy.
I wish to take further time to consider your Lordships' views. I had hoped that we might have generated interest in the subject from the distinguished legal talent which was present at an earlier stage this afternoon. In my mind the two subjects appeared to be closely allied but apparently that was not so in the minds of everyone. I am grateful to the noble Lord, Lord Mishcon, for tabling the Question. I am left with
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a certain amount of indecision. I shall read carefully what has been said to see whether your Lordships' comments prompt some of those who have been consulted to come forward more definitely than they have hitherto with a view on the whole matter—
Lord Mishcon: My Lords, before the noble and learned Lord sits down I wish, first, to thank him for dealing in detail with the discussion. Secondly, I wish to ask whether he has any preliminary views on my suggestion about bona vacantia?
The Lord Chancellor: My Lords, I have considered speaking about the matter briefly in relation to the recent television programme which appeared to suggest that a special law of intestacy applied in the Duchy of Lancaster. That would have surprised most people who thought that they understood the existing law of intestacy. The truth is that bona vacantia in the Duchy of Lancaster goes to the Duchy rather than to the Crown. Apart from some minor matters of procedure I do not believe that the differences between the two are of general interest.
The only exception as regards the County Palatine is that the property of those who die intestate goes to the Duchy but the matter is handled in a similar way. Any balance in England and Wales is paid directly into the Exchequer. In the County Palatine any such balance goes towards certain administrative costs incurred by the Duchy of Lancaster in the County Palatine, to the upkeep of certain historic monuments and to a benevolent fund whose income is distributed to causes primarily within the county.
The noble Lord's suggestion may be a good subject for further consideration. Such a proposal overcomes the difficulty of identifying a particular charity to which bona vacantia could go. I should not he surprised if there were difficulties of administration but I am sure that the noble Lord's suggestion—like all his suggestions—is worthy of further consideration. Perhaps I am unduly committing myself in respect of the outcome of that consideration.

Durham Markets Company Bill [H.L.]
Committed to an Unopposed Bill Committee.
House adjourned at nineteen minutes past seven o'clock.