Lords Sitting of 30 March 1993

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

Easter Act 1928
Lord Airedale Lord Airedale asked Her Majesty's Government:
What conclusion they have arrived at after studying the present advantages and disadvantages of implementing the Easter Act 1928 whereby Easter would always be celebrated during the first half of April.
The Minister of State, Home Office (Earl Ferrers): My Lords, the Answer is essentially the same as was given by my noble friend Lord Bathurst 32 years ago on 21st June 1961 when the first of these annual Questions was asked. The conclusion is that the status quo should obtain.
Lord Airedale: My Lords, I am grateful to the noble Earl, as always; but as regards the great Christian celebration, does not history show that it matters not when Easter is celebrated so long as it is celebrated? Regarding the secular public holiday, with people looking forward to the first open air holiday after the Winter, although Easter should not be allowed to run too close to the May Day holiday, is there not every chance of better weather out-of-doors in April than in March?
Earl Ferrers: My Lords, the noble Lord, Lord Airedale, confuses the two issues. One is religious and the other is secular. The important point on the religious side is that Good Friday and Easter Day are the most solemn dates in the Christian calendar, and it is therefore desirable that any agreement to move those dates should be agreed by all the Churches. The secular side follows from the religious.
Lord Hailsham of Saint Marylebone: My Lords, does my noble friend agree that there may be a group of eccentrics, including myself, who like Easter to fall on different days in different years so that we can enjoy different phases of our glorious Spring in peace and quiet?
Earl Ferrers: My Lords, that also is a secular observation. I agree with my noble and learned friend that he may well be eccentric. He is not alone in that. If Easter is to be moved as it is a religious festival, that should be done with the agreement of the Churches.
Baroness Seear: My Lords, why is it all right to separate the secular and religious aspects at Whitsun but not at Easter?
Earl Ferrers: My Lords, that is a good question. I have often wondered about that.
Lord Richard: My Lords, perhaps the noble Earl should consult the noble Earl, Lord Bathurst, as regards what the Answer to the Question should be. I
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congratulate the noble Earl, Lord Bathurst, in his absence, on the perception which he displayed 32 years ago in giving a sensible Answer to the Question.
Earl Ferrers: My Lords, I am grateful to the noble Lord, Lord Richard, for his comments. However, I should have preferred it if he had congratulated me on the Answer that I gave to the Question.

War Crimes Act: Cost
2.40 p.m.
Lord Boyd-Carpenter Lord Boyd-Carpenter asked Her Majesty's Government:
What has been the cost to date of the attempted implementation of the War Crimes Act 1991; what is the estimated cost for the financial year 1993–94; and how many prosecutions under the Act have been started.
Earl Ferrers: My Lords, the costs of the implementation of the War Crimes Act are so far estimated at £3.39 million. A provision of £10.6 million has been made for the financial year 1993–94 but costs are dependent on the outcome of the investigations and proceedings. No prosecutions have as yet been started under the Act.
Lord Boyd-Carpenter: My Lords, does not my noble friend's Answer indicate that this matter has been an appalling waste of public money?
Earl Ferrers: My Lords, Parliament decided that this course should be adopted and Parliament is responsible for it. Whether or not it is a waste of public money is a matter for individual interpretation.
Lord Mayhew: My Lords, during the debates on the legislation the Government relied heavily on the view of the authors of the report that in spite of the passage of time prosecutions should go ahead. As further passage of time has elapsed, is that still the view of the authors of the report? Do not Ministers have some obligation to make inquiries and let us know?
Earl Ferrers: My Lords, I cannot possibly tell the noble Lord, Lord Mayhew, what the view of the authors of the report is. All I can do is to remind the noble Lord what Parliament suggested. This matter was debated fully in both Houses on a number of occasions and Parliament in its wisdom decided that this was the course to be adopted. That is the reason why it has been adopted.
Lord Hailsham of Saint Marylebone: My Lords, will my noble friend care to hazard a guess as to who will win the race: the Great Reaper, who will eventually kill off all possible defendants, or the Government in starting prosecutions?
Earl Ferrers: My Lords, it would not be appropriate for a Government Minister to enter into a lottery of that character.
Lord Stoddart of Swindon: My Lords, will the noble Earl confirm his Written Answer to me on 8th December that the Government have set aside £36.6 million for these prosecutions? Will he also confirm

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that two of the people being pursued would have been under 16 when these alleged crimes were committed and that a good many—23 of them—are over the age of 75? Is this money well spent unless we are to obtain some prosecutions soon?
Earl Ferrers: My Lords, it is impossible to say how much money will be spent until it is known whether or not there will be any prosecutions. Clearly, if there are prosecutions the amount involved will be larger. Provision has been made on a three-year basis. As regards people who the noble Lord, Lord Stoddart, says were under 16 at the time, one of the matters being investigated in each case is whether the person concerned was under that age.
Lord John-Mackie: My Lords, is it possible to detail where all that money is spent?
Lord Hutchinson of Lullington: My Lords, are the sums mentioned by the noble Earl—
Earl Ferrers: My Lords, the noble Lord, Lord John-Mackie, asked a question. I am not sure that I heard it all: I think that he asked where the money was being spent. The answer is that in 1992–93 £1.36 million was spent on the police and £230,000 on the Crown Prosecution Service. In the estimates for 1993–94 £1.5 million is allocated for the police, £2.5 million for the Crown Prosecution Service, £0.9 million for the Lord Chancellor's Department and the courts, and £5.7 million for legal aid should that be required.
Lord Shaughnessy: My Lords, can the noble Earl say how many cases are being investigated under the Act at the moment compared with the original group of suspects identified in the Hetherington-Chalmers Report?
Earl Ferrers: My Lords, 300 cases were identified by the Hetherington-Chalmers inquiry. A further 43 cases have been brought to the attention of the Metropolitan Police war crimes unit. All cases have been reviewed and currently 91 cases are under investigation.
Lord Braine of Wheatley: My Lords, does my noble friend agree that, having regard to the gravity of the crimes in question, justice delayed is justice denied?
Earl Ferrers: My Lords, that is one of the issues about which people feel very strongly. Parliament has decided that this is the course to be adopted and that is why this action is being taken.
Lord Macaulay of Bragar: My Lords, can the noble Earl state how many police officers are presently involved in these inquiries? What are the ranks of those officers? Further, can he say in what countries their investigations are currently being carried out?
Earl Ferrers: My Lords, there are 11 police officers and five civilians in the Metropolitan Police war crimes unit. I cannot tell the noble Lord the ranks of each of those police officers. Police officers and Crown Prosecution Service staff have travelled abroad to Russia, the Ukraine, Belarus, Latvia and Germany to
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see witnesses and visit archives. Police officers have also travelled to Poland, Israel, the United States, Canada, Australia and South Africa.
Lord Monson: My Lords, further to the intervention of the noble Lord, Lord Stoddart of Swindon, does the noble Earl not agree that there is something inherently obscene in the idea of prosecuting people aged 65 for something they may or may not have done when only 15 years old?
Earl Ferrers: My Lords, we have no statute of limitations in this country for crimes of murder and we cannot ignore evidence which has been or may be uncovered.
Lord Mackie of Benshie: My Lords, is it not the case that despite the passage of time and the expense, some justice is due to the victims of the holocaust?
Earl Ferrers: My Lords, that is a perfectly respectable view.

Satellite Broadcasting: Competition
2.45 p.m.
Lord Thomson of Monifieth Lord Thomson of Monifieth asked Her Majesty's Government:
What inquiries they are making into the ownership of encryption technology for satellite broadcasting to ensure that there are full and fair competitive conditions for new entrants.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Baroness Denton of Wakefield): My Lords, the Government have not initiated inquiries into the ownership of encryption technology for satellite broadcasting. It would be for the Office of Fair Trading to investigate complaints that the ownership of such technology is being abused to suppress open competition in the satellite television market.
Lord Thomson of Monifieth: My Lords, is the Minister aware that new entrants in the growing business of satellite broadcasting by subscription now face a potentially monopolistic situation in a practical sense because BSkyB controls the plastic smart-card technology? Should it not be a matter of concern to a government who believe in competition that the Murdoch media interests, which currently control 35 per cent. of the national newspaper market and which dominate control of BSkyB, should now have a fully-owned subsidiary—News Datacom—which stands at the tollgate for new entrants? Is there not a clear case for investigating that potentially monopolistic situation before it goes too far?
Baroness Denton of Wakefield: My Lords, we believe that the OFT provides effective recourse against anti-competitive practices. I understand that the director general has not received any representations on this matter.
Lord Renton: My Lords, can my noble friend enlighten some of us by defining encryption technology? Can she also let us know who owns it?
Baroness Denton of Wakefield: My Lords, encryption technology is a system which allows people to charge for broadcasts from satellites. It is a conditional access system which works in two distinct ways. The television signal is scrambled to make it unwatchable and the information which will allow the viewer to unscramble the signal is encrypted.
Lord Taylor of Gryfe: My Lords, is the Minister aware that in order to protect their entry into satellite broadcasting it is necessary for companies to subscribe to this technology? However, if such technology is in the hands of one private operator, which operates Sky television, it becomes extremely difficult for newcomers to enter the field since the technology and the licence are in the hands of one operator who is already in that business. Is this not a case where the Government should refer the situation to the OFT rather than simply waiting for the OFT to take it up?
Baroness Denton of Wakefield: My Lords, I suggest to the noble Lord that we are not dealing with unsophisticated players. Other people such as UK Gold are using the system. Should they feel a necessity to complain to the OFT, I am sure that they will.
Lord Orr-Ewing: My Lords, is my noble friend aware that there are a number of encryption services? News International BSkyB estimates that it has already spent £200 million on perfecting its service. Is the Minister aware that commercial broadcasters have successfully made a deal with Japanese TV and with TV Asia? Negotiations are under way in the partnership which exists between the BBC and Thames to try to form an agreement. Surely, it is better that those negotiations should continue between competitors rather than a solution being imposed on them by someone else.
Baroness Denton of Wakefield: My Lords, I agree with my noble friend. We believe that open competitive practice is the best means.
Baroness Birk: My Lords, does the Minister agree that there are no open competitive practices at present? The monopoly outlined by the noble Lord, Lord. Thomson of Monifieth, is held by Rupert Murdoch. He has a great slice of the press in this country and the satellite stations too. Much as we sought to obtain a change in that situation under the Broadcasting Act, it was not possible. Since there are no competitors against him, is it not now time for the Government to give a nudge to the Office of Fair Trading so that something at last is done about the outrageous monopoly in the ownership of Rupert Murdoch?
Baroness Denton of Wakefield: My Lords, as the noble Baroness states, the ownership restrictions were extensively debated when the ownership order was before the House. The Government are not convinced that they need to be changed. Negotiations with companies such as UK Gold and Japanese companies to use the same system, as my noble friend suggested, are taking place.
Lord Harmar-Nicholls: My Lords, if only a few of the dangers outlined by the noble Lord, Lord Taylor of Gryfe, arise, ought not the Government to take an interest at the earliest possible stage in order to avoid them?
Baroness Denton of Wakefield: My Lords, I point out to my noble friend that there are alternative news services, in particular the BBC and ITN.
Lord Donoughue: My Lords, I am sure that all noble Lords are grateful for having been made familiar with encryption technology. Is not the heart of the technology that it controls the gateway to the Astra satellite broadcasting? Is it not indefensible that one person who is a major media baron elsewhere should control that gateway? Do the Government really believe in competition, or is it competition for the miners with a cosy monopoly for newspaper barons? Surely it is a case for Sir Bryan Carsberg, who has just taken over at the OFT, urgently to investigate.
Baroness Denton of Wakefield: My Lords, I remind the noble Lord that CNN is also broadcast by a satellite outside the system. However, perhaps I may state firmly that no evidence has been presented to the OFT to suggest that the current situation is anti-competitive or monopolistic within the terms of existing legislation.
Lord Chalfont: My Lords, does the Minister not agree that there is no need for any greatly advanced technology to make most television programmes unwatchable?
Baroness Denton of Wakefield: My Lords, I believe that the noble Lord will attract much sympathy from your Lordships' House on that matter.
Lord Thomson of Monifieth: My Lords, the noble Baroness referred to UK Gold in which the BBC is involved. The BBC is financed by our licensing fees. It tried to establish an independent arrangement for its encryption but finally felt obliged to surrender to BSkyB. Does the Minister believe, having regard to the expression of views from both sides of the House today, that sufficient representations have been made from your Lordships' House to encourage the Government, in the public interest, to urge the OFT to investigate the matter?
Noble Lords: Hear, hear!
Baroness Denton of Wakefield: My Lords, perhaps I may say to the noble Lord that I am sure the BBC made the decision on commercial grounds. As I said in reply to most questions, it is for complainants to go to the Office of Fair Trading.

Community Care: Implementation
2.55 p.m.
Earl Russell Earl Russell asked Her Majesty's Government:
Whether they are satisfied that there is enough money available to implement community care after 1st April.
The Parliamentary Under-Secretary of State (Department of Health (Baroness Cumberlege): My Lords, yes.
Earl Russell: My Lords, I thank the noble Baroness for that reply. I hope that it may prove correct.
The noble Baroness is doubtless aware of the letter of 1st March from Mr. David Lambert in her own department, directing directors of social services to record unmet choice and not unmet need. Does she agree that that has cast some doubt on what the Select Committee in another place called the transparency of the Government's funding arrangements? Does she agree that it makes it more urgent to ask whether the Government accept Recommendation 5 of the report of the Health Committee in another place? The report recommends that the Government should make sure:
"that there are no inhibitions on the ability of social services departments and health authorities to make a full assessment of unmet needs. It will be difficult to judge in future whether resources are adequate unless we have a clear indication of the level of need, both met and unmet".
Do the Government accept that recommendation?
Baroness Cumberlege: My Lords, it is quite right and proper that assessments are made of individuals and that those assessments are shared with the individual concerned. That is laid down quite clearly in our guidance. However, asking social workers to produce a list of services that might be helpful without any thought for resources or priorities would be to ignore reality. Perhaps I may say to the noble Earl, Lord Russell, that the Health Committee also stated that the new funding arrangements provided the potential for a better and more efficient use of public money.
Baroness Faithfull: My Lords, perhaps I may ask the Minister, first, whether money from central Government to local government for community care has been ring-fenced? Secondly, will those projects which are now the responsibility of the local social services department but which are run by charities continue to receive the grant that they previously received from central Government now that those projects are non-statutory and the money is not stretching to them?
Baroness Cumberlege: My Lords, my noble friend is correct in her assumption that the money is ring-fenced—£565 million to local authorities. That includes an additional £140 million above the amount which the Department of Social Security would have spent had current arrangements continued.
With regard to charities, it is up to local authorities to decide which local charities they wish to support, but of course the Government support national charities under Section 64 funding.
Lord Molloy: My Lords, is the noble Baroness aware that the six main points of the Government's proposals appear to be most laudable, and are well overdue? They involve elderly people, the disabled and those suffering from drugs and AIDS. However, will the Government make sure that local authority assessment is fair and just? Will help also be given to
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aged people who are in private nursing homes whose relatives are sometimes hard-pressed to afford the payment? Will some help be given in that area too?
Baroness Cumberlege: My Lords, I thank the noble Lord for his initial comments. Local authorities will take particular care with people who are in private and residential care. I forgot the noble Lord's second question.
Lord Molloy: My Lords, I referred to people in private homes and those unfortunate people who suffer from drug-taking and matters of that description. Some of those who contribute to payment for people in private nursing homes can no longer afford to do so. Perhaps the Government will take note of that situation.
Baroness Cumberlege: My Lords, I think that I answered that point.
The Countess of Mar: My Lords, is the noble Baroness aware of the considerable anxiety among the medical profession that the vulnerable, elderly, sick and disabled are at the mercy of the whim of a lottery, virtually, because some local authorities have more money available than others? Is it not now the time and place to publish a charter in which the basic needs which can be assumed for all local authorities are published? If that is so then those who have extra money or who are prepared to contribute extra money can provide the frills.
Baroness Cumberlege: My Lords, the money is ring-fenced. It is a considerable sum of money; it is new money to social services—£565 million. The calculations were based on the social security moneys which would have been spent in the next year, taking into account the anticipated increase in elderly people needing residential or nursing home care.
A further 30,000 additional cases were added, twice the number needed to keep pace with demography and people discharged from long stay hospitals. In addition, my right honourable friend the Secretary of State, in her negotiations with the Treasury, secured another £140 million.
Baroness Carnegy of Lour: My Lords, while accepting that these are serious and important questions, does my noble friend agree that the scope for meeting needs for care is endless? Therefore, by definition, there will never be enough money for community care.
Baroness Cumberlege: My Lords, my noble friend is correct in saying that the money will, of course, be tight. We brought in the new assessment procedure because we believe that local people will have a better idea of what is needed in their local areas. That assessment will be sensitive. Whereas before there was an incentive for people to go into residential care, the new scheme is intended to help people to stay at home, where the vast majority want to be.
Baroness Robson of Kiddington: My Lords, in view of the uncertainty over the true costs of implementing community care on 1st April, are the Government

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prepared to set up a contingency reserve as recommended in the House of Commons Select Committee report, paragraphs 88–91?
Baroness Cumberlege: My Lords, I think, as I have explained, that the amounts of money are enormous—they are huge. We anticipate them being enough. If we were to keep contingency sums, it would mean that perhaps some people would be denied care in the coming year. I think it is preferable that social services departments should have that money in order to make their assessments and in order to help people who are very much in need.
Lord Ashley of Stoke: My Lords, is the Minister aware that the rosy picture which she paints is not shared by the vast majority of organisations for disabled people? Is she aware that the Select Committee for Health in another place said that there would be a 20 per cent. underfunding, mainly in London and inner city areas? Is she also aware that the survey by the Association of Directors of Social Services said that no less than 87 per cent. of local authorities plan cuts in their provision? If that is true, it means that many disabled and elderly people will suffer very great hardship unless the Government think again.
Baroness Cumberlege: My Lords, this money, this special transitional grant, is not going to be cut. It is ring-fenced. And it is not capped.
Lord Skelmersdale: My Lords, irrespective of the detailed supplementary questions and answers that we have had on this Starred Question, may I ask my noble friend the Leader of the House whether Starred Questions are still intended to elicit information from the Government and whether he considers that this question falls into that category?
Lord Ennals: My Lords, apart from the underfunding to which my noble friend Lord Ashley referred, is the noble Baroness aware that her department is already slashing grants to excellent voluntary organisations, particularly the organisation Extend? It does wonderful work for elderly and disabled people and I have been its president for 15 years. The organisation was not just told that its grant would be reduced; it was told that for the first time in 15 years the grant would be cut altogether. Is that not totally irresponsible and unfair to noble voluntary organisations?
Baroness Cumberlege: My Lords, the total amount of money that the Government are giving in their grants to national organisations is not being cut. I think it is quite right, though, that the Government should sometimes re-order their priorities and make an assessment of the individual organisations to which they are giving. Very often, it is important to re-order that money in order to pump-prime new organisations that are trying to get off the ground.
Lord Carter: My Lords, is the Minister aware that there is still considerable confusion regarding the rights of the individual to receive community care and the duty of the local authority to provide that care? If,
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after an appeal, an individual is assessed for community care and the local authority says that it lacks the resources to provide that care, what will happen?
Baroness Cumberlege: My Lords, it is absolutely right that social services departments, in doing those assessments, have to take into account the resources that are available. I am very optimistic on the subject. In my experience a little money goes a very long way in terms of supporting people in their own homes. I have spoken to a number of carers who have very small requirements. Sometimes I think that those working in the field—social workers—try to produce a list of services which is more of a wish list than the actuality of what is required.
Lord Mancroft: My Lords, is my noble friend aware that too often this is an issue not of funding but of control? Whereas local authorities will always spend up to their budget, regardless of what it is, many voluntary sector organisations spend with a great deal more care and skill, which up until the changes the Government had recognised. By giving all the money back to the local authorities, the Government are condoning a greater level of inefficient spending.
Baroness Cumberlege: My Lords, it is quite right that the responsibility for this should be with the social services departments. I agree, though, with my noble friend that voluntary organisations on the whole spend their money very well and very wisely. That is why the Government give them so much support.
Earl Russell: My Lords, does the noble Baroness accept Recommendation 11 of the Select Committee? If I may paraphrase it, the recommendation states: if it turns out that there is not enough money, will the Government please notice and do something about it?
Baroness Cumberlege: My Lords, I note the noble Earl's comments.

Business
3.7 p.m.
Lord Hesketh: My Lords, it may be for the convenience of the House to know that the Committee stage of the Trade Union Reform and Employment Rights Bill will be adjourned at about 7.30 p.m. for about one hour and that during this adjournment the Third Reading of the Video Recordings Bill and the Local Elections (Variation of Limits of Candidates' Election Expenses) (Northern Ireland) Order 1993 will be taken.

Disabled Persons (Services) (No. 2) Bill [H.L.]
Lord McColl of Dulwich: My Lords, I beg to introduce a Bill to empower local authorities to make certain severely disabled persons accountable for expenditure on their care plans.
I beg to move that this Bill be now read a first time.

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Moved, That the Bill be now read a first time.—(Lord McColl of Dulwich.)
On Question, Bill read a first time, and to be printed.

Business of the House: Debate, 31st March
The Lord Privy Seal (Lord Wakeham): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the debate on the Motion in the name of the Lord Richard set down for Wednesday 31st March shall be limited to five hours.—(Lord Wakeham.)
On Question, Motion agreed to.

House of Lords Offices: Select Committee Report
3.9 p.m.
The Chairman of Committees (Lord Ampthill): My Lords, I beg to move that the fourth report from the Select Committee on House of Lords Offices be agreed to.
Moved, That the fourth report from the Select Committee be agreed to (HL Paper 72).—(The Chairman of Committees.)
Following is the report referred to:
1. Parliamentary Works Programme
The Committee endorsed the use of a ten year rolling programme as the basis of the annual works programmes and PES bids. It agreed that the substantial backlog of conservation and maintenance work should be made good as quickly as practical and that the necessary funds should be provided. It also agreed that funds should be made available for new works in the South East Return in the financial years 1993–94 and 1994–95.
2. New Civil Service pay schemes
The Committee approved in principle proposals, currently under discussion with unions and staff, for the adaptation of new Civil Service pay schemes to the circumstances of the House of Lords, subject to the satisfactory outcome of the consultations.
3. New secretarial grading structures
The Committee approved the introduction of a new secretarial grading structure, based on that already in place in the House of Commons, and the upgrading of certain posts in order to create a better career structure.
4. Refreshment Department profit-sharing scheme
The Committee approved the introduction, with effect from the 1993–94 financial year, of a
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profit-sharing scheme for staff in the Refreshment Department. The scheme will be financed from the Department's Trading Fund.
5. Security manning review
The Committee approved a series of measures to improve security by more efficient and cost effective use of manpower and technical resources.
6. Taxation of official residences
The Committee agreed arrangements to meet the tax liability, under the Income and Corporation Taxes Act 1988, of occupants in respect of official residences on the parliamentary estate.
7. Works of Art Collection Fund
The Committee approved the setting up of a Works of Art Collection Fund and a memorandum describing the arrangements which will govern it.
8. Nominations to the Board of POST
The Committee agreed that the Lords members of the Board of the Parliamentary Office of Science and Technology (POST) should be selected by the Committee of Selection under the provisions of Standing Order 61(5A).
9. Car Parking
The Committee took note of the provision of additional car parking space in the vicinity of the House.
10. Appointments and promotions
The Committee was informed of—

(a) the appointment of Mrs P.J. Woolgar as Shorthand Writer to the House with effect from 1 April 1993 in the place of Mrs E.M.C. Holland who retires on 31 March 1993;

(b) the appointment of Miss Margaret Douglas, Chief Political Adviser to the BBC, as Supervisor of Parliamentary Broadcasting with effect from June 1993 in the place of Mr John Grist;

(c) the promotion of Dr. F.P. Tudor to Chief Clerk with effect from 15 February 1993.

Lord Bruce of Donington: My Lords, I have a short technical point to raise with the noble Lord the Chairman of Committees concerning paragraph 6 of the fourth report which states:
"The Committee agreed arrangements to meet the tax liability, under the Income and Corporation Taxes Act 1988, of occupants in respect of official residences on the parliamentary estate".
I am unaware of the identity of the occupants and have no wish in any way to criticise them or to worsen their financial situation.
I ask whether the previous occupants received exactly the same benefits under agreed arrangements, or whether this is something entirely new. If it is entirely new, I first of all draw the attention of the House to the fact that in suitable cases where the condition applies, it is always open to the occupant to dispute any Inland Revenue assessment as to benefit on the grounds that it is necessarily, compulsorily, as a condition of his job that he occupies the official residence; and that under the normal Schedule E expense rules any benefit he receives must be wholly, necessarily and exclusively incurred in the performance of his duties. If those considerations apply to any of the occupants, there is no necessity for any

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arrangements for the House or its funds to reimburse the occupants concerned, since they will be entitled to relief.
If on the other hand those conditions do not apply, I may draw the attention of the House to the fact that the many high officers of state, including many prominent politicians and Cabinet Ministers, already pay tax for the benefits that they receive by reason of occupying official residences. I name, for example, Admiralty House, where I understand certain Ministers have pied-a-terre facilities and various benefits of that kind. I also believe, though I am not quite certain, that both the Prime Minister and the Chancellor of the Exchequer are accountable for any benefits they receive.
Therefore, I wonder whether there are any special reasons why that tax liability should be met. I sincerely hope that none of the occupants is known to me personally and will not strike me down in lightning for raising the point. But it is a matter upon which the House should be informed and, I hope, reassured.
The Chairman of Committees: My Lords, it is entirely understandable that the noble Lord raises the matter. The situation that has arisen is a new one. The Inland Revenue has changed its practice. On account of that, and in the Eight of the fact that the other place decided that as this came as a surprise, it was felt to be fair for the time being—it is not necessarily for the indefinite future—that the House should reimburse those people who were "caught by surprise". I think that is a reasonable way to describe it.
Lord Bruce of Donington: My Lords, perhaps I may question the noble Lord a little further. From what he has said—and I am most grateful for his reply—I gather that the Inland Revenue has had a change of practice. Has it had repealed some statutory obligations which it already had? By whose consent was that change of mind accomplished? And is there any particular reason why the other place (which is ultimately the supreme arbiter of all such matters) should so willingly concur in a change of practice? Did the Inland Revenue give any particular reason, supported by any case law or commissioner decisions, in favour of changing its practice?
The Chairman of Committees: My Lords, the noble Lord is so much better informed than I am about matters to do with accountancy. It is a question of the interpretation of the law as it stands. As he is aware, the Inland Revenue is wont to take a different view once in a while about its past practices. This is something it has decided to do. It is in accordance with the law. It may indeed eventually be tested by the courts if it is thought that in any way the Inland Revenue is outside its rights. It is thought to be within its rights to interpret the matter in this way.
Lord Stoddart of Swindon: My Lords, I ask the noble Lord the Chairman of Committees whether that applies only in the case of existing employees, or whether it will extend to new employees when the existing holders of the posts leave them.
The Chairman of Committees: My Lords, I have already said in reply to the noble Lord, Lord Bruce of Donington, that this is not an open-ended commitment for the indefinite future. It will be reviewed.
Lord Stoddart of Swindon: My Lords, that does not answer my question. "Open-ended" can mean 50 years or 100 years. I want to know whether it will be extended beyond the period of employment of the existing staff who will enjoy the benefit.
The Chairman of Committees: My Lords, no decision has yet been made on that point. I believe it must be left for further consideration. It came as a surprise to the Finance and Staff Committee. Therefore, I believe that further consideration should be given to the matter, if the noble Lord will be so kind as to leave it like that.
On Question, Motion agreed to.

Trade Union Reform and Employment Rights Bill
3.16 p.m.
The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Viscount Ullswater.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 29 [Amendments of transfer of undertakings regulations]:
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 204:
Page 46, line 46, at end insert:
("() For the purpose of implementing Council Directive 77/187/EEC, 14 February 1977, there shall be inserted as Regulation IA in the Transfer of Undertakings (Protection of Employment) Regulations 1981 the following provision—
Recognition of Trade Union for purposes of negotiation.
"1A.—(a) Where an independent trade union notifies ACAS that an employer does not recognise it for negotiation of terms and conditions of his employees ACAS may, if it sees fit, make inquiry of and consult the employer with a view to ascertaining whether to recommend that he should grant the union recognition as bargaining agent for some or all of his employees in respect of such matters as it recommends for the purpose of implementing these Regulations.
(b) Where at a date set by ACAS not later than six months after the date of such a recommendation the employer refuses or fails to recognise the trade union which was recommended by ACAS, the authorised representatives of the trade union so recommended shall be presumed to be representatives of a recognised trade union for the purposes of Regulations 10 and 11.
(c) ACAS shall conduct its enquiries under this Regulation of such persons it sees fit to consult, and in accordance with a Code of Practice made by the Secretary of State under section 203 of the Trade Union and Labour Relations (Consolidation) Act 1992; and where in its discretion it deems it to be necessary ACAS may

729
hold a ballot of some or all of the employees concerned under conditions approved by the Certification Officer.
(d) ACAS shall publish its recommendations or other decisions made under this Regulation.
(e) Disputes under this Regulation shall be referred to the Central Arbitration Committee ("CAC") for determination under regulations to be made in consultation with the CAC by the Secretary of State by order made by statutory instrument." ").
The noble Lord said: I beg to move Amendment No. 204 and speak also to Amendment No. 218, both of which have some relevance to Amendment No. 207 in the name of my noble friend Lady Turner and Amendments Nos. 212 and 220 in the names of the noble Lord, Lord Rochester, and the noble Baroness, Lady Seear.
The amendments largely concern two Community directives, Directives Nos. 187 of 1977 and 129 of 1975 as amended last year. I say at once that the problem which they raise is every bit as important to the interests of working people as are the issues on the Marshalled List, such as that of low pay, for the Committee to debate later.
Community law requires employers to consult with the representatives of employees in two situations; first, very broadly, on the transfer of the employer's undertaking, which is the subject of this amendment and of the 1977 directive; and secondly, when the employer contemplates collective dismissal—or, in a special sense here, redundancy—which is the parallel concern of Amendment No. 218 and of the 1975 directive as amended.
The amendments propose, first, that there should be proper fulfilment of our Community commitments under those directives; and secondly, even more forcefully, that they are right in themselves. On a transfer of the undertaking in all its many forms or when facing mass dismissals, it is not asking very much that workers should at least have the right to consultation with their independent representative. In a recession, amid mounting unemployment, it is scarcely extreme, and is certainly not seen as extreme by our competitive partners in the Community, that the law should provide for some consultation—a spirit that demands the support, I believe, of the country as a whole, as the Government learned last October. But there can be no consultation unless independent representatives of workers have a place at the table. There cannot be what the Community's directives set out to enforce if those workers' representatives are not there. The existing provisions purporting to implement those Community directives in this country are the so-called TUPE regulations of 1981, now Section 188 of the consolidation Act of 1992.
Both measures provide that in British law the employer is to consult with authorised representatives of a trade union recognised by him. But we know from the Government's insistence on the point in another place that since the Act of this Government which was passed in 1980, there has been no legal obligation to recognise at the table independent representatives or indeed any representatives of workers. Again and
730
again in another place Ministers have stated their policy. Let me take the most crisp formulation of that government policy. Mr. Forsyth said:
"The terms of the directive allow for existing custom and practice to be taken into account in implementing the directive. There will be no requirement to consult, if an employer has not recognised trade unions. That is our interpretation of the directive".—[Official Report, Commons, Standing Committee F, 26/1/93; col. 545.]
That is the doctrine of subsidiarity turned into the doctrine of inactivity. I am well aware—the Government have repeated it again and again—that it is the stance which the Government have taken before the European Court of Justice in Luxembourg. They made some play of the fact that, with due attention to subsidiarity, both directives define the representatives (to take the precise formulation of 1977) as representatives of the employees provided for by the laws and practices of member states. From that the Government draw the conclusion that the directives should not be implemented in a way that might be thought to give some substance to consultation, because in Britain there is no law that requires employers to recognise, except for very marginal issues, any consultation at all, save for health and safety.
It seems to me that the Government never address themselves to a further point. If the directive meant that it allowed for a practice or law in a member state to the effect that it does not have representatives of employees—I do not believe that any other member state takes that position; nor does the Commission, which is why it is pursuing infraction proceedings before the court—then it would not get off the ground. It would have been a very odd directive to pass. But that is not the position. After 1975, when the consultation on redundancy directive was implemented in the Act of that year, and until 1980, there was a procedure whereby ACAS could require an employer to recognise a trade union for certain purposes. There was that procedure. It was not a perfect procedure by any means but it was a fallback situation. The law said that after ACAS had gone through all the steps it had to take (sometimes failing in doing so) and had followed all the right procedures, the employer was obliged in law, with the very ordinary sanction which was not very severe, to act accordingly. Once it had got to that point, the directive bit.
The reason why the directive does not bite is because the Government repealed the one measure which caused it to bite in English law. The Government therefore have to say to the court and the Commission, "The directive does not say that nobody need consult if there is a law or practice that does not enjoin it. Furthermore, the representatives of the employees who once had a right to consult and therefore fell under the Commission's directive now have no place because we, the Government, have repealed that law."
If one took that approach to the directive, one would be able to escape from any directive that one wished to avoid. Indeed, the Government have said that they wish to escape from the transfer of undertakings directives. So far as Community law is concerned—I appreciate that we stand on the edge of

731
a battle in the Luxembourg court—surely the Government owe it to the people of this country who were deprived of their Community rights in 1980 at least to put them back on the statute book.
To cure any misunderstanding, that is precisely the effect of this amendment and its fellow amendment for the redundancy consultation section. The amendments say that where there has been no consultation or negotiation after a long time, ACAS can inquire into the matter and, according to a code of practice which it is for the Minister to lay down, ACAS can say that employers must sit at the table with those people as recognised representatives for the purposes of consultation over redundancies. That is no extreme proposition. It is common sense. I believe it to be our obligation within the Community. I beg to move.
Baroness Turner of Camden: I support the amendment moved by my noble friend. I believe that Clause 29 is an improvement and generally to be welcomed. But the Government have finally had to come to terms with the fact that their 1981 regulations do not provide proper protection for those affected by business transfers and do not meet EC requirements.
It seems to me that there is a problem, to which my noble friend has drawn attention. An employer could simply ignore the obligation to consult with representatives of the workforce simply by derecognising the trade union. Similarly, there is no right to consultation under the regulations if the employees are in a union which the employer stubbornly refuses to recognise. Perhaps he has done so in order to comply with what he perceives to be the philosophy of the Government. That frequently happens now. Indeed, as we know, there has been active encouragement to employers by the Government not to recognise unions. However, it is not an easy philosophy where unions are regarded as social partners rather than potential adversaries.
The amendment provides a mechanism whereby the workforce can secure recognition and thus the right to be consulted in the event of a transfer and the problems that may follow, including the problem of possible redundancies. Under my noble friend's amendment, ACAS is involved in the process. That seems entirely right, bearing in mind its functions and expertise in the areas concerned. My noble friend has thought through the whole process, including making a provision for the Central Arbitration Committee to deal with any dispute. The amendment seems entirely admirable. I hope that the Minister will support it in principle even if he cannot support the wording.
The Minister may well say that the amendment imports trade union recognition by the back door, so to speak, and that trade union recognition is a matter only for the employer on an entirely voluntary basis. We have heard him say that in discussions on this Bill on previous occasions. But the fact remains that that is not in accord with EC philosophy and not in accord with the spirit of the regulations. In the EC unions are not marginalised as they have been in the UK by over a decade of Conservative legislation. Involvement of the workforce means in the EC directive involvement via the unions. My noble friend's amendment tries to
732
ensure that the mechanism exists in the UK for carrying out the intentions of the regulations. I support it.
Lord Boyd-Carpenter: I hope that my noble friend the Minister will not accept the amendment. It is a very ingenious attempt to use the European Community legislation to effect a substantial and, in the view of some Members of the Committee, very harmful change in our existing law. It is perhaps a matter for some amusement that the amendment refers to a Community directive formulated as long ago as 1977. One would have thought it might perhaps have lost a certain amount of validity with the passage of time and non-implementation.
But the substance of the matter is serious and important. There are situations in which an employer does not wish to recognise a union. Fortunately, there are not very many of them. Most employers are well disposed toward recognising most unions. But there are some unions whose reputation and attitude are such that a sensible employer does not wish to have anything to do with them. As I understand it, the amendment would have the effect of depriving those employers of that discretion.
That would be a very serious change for the worse in our law. Although the amendment has been ingeniously engineered by its reference to the attitude of the European Community, it is not acceptable to those who are concerned with the smooth and efficient working of the British industrial system. I hope that the Committee will reject the amendment.
3.30 p.m.
Lord Campbell of Alloway: On this occasion I could not agree less with everything that has been said by my noble friend Lord Boyd-Carpenter. It is far better that I say that and be totally frank. It will come as no surprise to my noble friend the Minister that I say that from these Benches; I have been saying as much to him over a period of some two years. He is courteous and gracious enough to accept that.
There are two views. There is the view of my noble friend Lord Boyd-Carpenter—which I shall take a little time to consider—and another view which is not exactly the form of the amendment. That view is that it is assuredly not harmful to our domestic law to import a recognition machinery into our industrial relations system. Indeed, it is a wholly requisite provision for any ongoing highly industrialised society today. The cleavage between my noble friend Lord Boyd-Carpenter and myself is great—he says that it is harmful and I say that it is requisite.
As yet the Government adhere to the view expressed by my noble friend Lord Boyd-Carpenter, but they did not always do so. The day will come when assuredly they will not do so again. I hope that it will be within a short time and that both my noble friend Lord Boyd-Carpenter and I will be present to discuss the matter once again.
The recognition machinery which existed was originally devised by Barbara Castle in In Place of Strife. The Labour Cabinet was divided upon the matter, as appears from the Crossman Diaries. As I

733
suppose was inevitable, in the end Barbara Castle won and produced In Place of Strife and the industrial relations Bill which contained a recognition machinery. It was madly complex and I was concerned with it professionally on behalf of employers and trade unions in the wake of the 1971 Act.
The curious thing is that although the Act was under savage and sustained attack throughout the whole of its life, the one aspect of it that worked to the entire satisfaction of both employers and trade unions was the recognition machinery. Indeed, the noble and learned Lord, Lord Donaldson, who was President of the National Industrial Relations Court, would confirm that if he were in his place. It was at a time when strikes were far more prevalent than they are today. That is why I say from my professional experience, my belief and my view as to the status of trade unions and employers in an industrial society such as our own, that there ought to be a recognition machinery.
Many Secretaries of State, including my noble friend Lord Carr of Hadley—with whom I worked closely in those days —took the view, and other responsible Conservatives have taken the view, that it is essential to have some form of recognition machinery as an aid to predictability—for forward pricing and forward contracts, the essence of a successful industrialised society.
I am not concerned with breaches of convention. I do not much like the form of the amendment or, with respect to the noble Lord, Lord Wedderburn, the way that he argued in support of it. But I support the fundamental principle for the reasons that I have given. Breaches of convention are justiciable both before the European Commission and at the European Court of Justice. Even in our courts credence is given to the legal efficacy of those directives. I am not so concerned about that. However, I am concerned that we have no form of recognition machinery either for negotiation or for consultation.
I apologise for detaining the Committee but the issue is something in which I believe. It is time we had a recognition machinery. That does not mean that I shall vote against the Government. I shall probably abstain because I know that the Government do not agree with me.
Baroness Seear: Although the names of my noble friend Lord Rochester and myself are not attached to the amendment, we wish to support it. Like the noble Lord, Lord Campbell, we believe that it is essential to have well organised industrial relations machinery, and that involves properly recognised trade unions. For that purpose we believe that the Act, either intentionally or unintentionally, is fatally undermining the trade union tradition. That will be extremely bad for industrial relations in this country.
The use of ACAS for recognition machinery and the need for recognition machinery is obvious. On that line of argument I wish to support the amendment.
Viscount Ullswater: Amendment No. 204 is concerned with identifying employee representatives
734
for the purpose of the transfer of undertakings regulations, while Amendment No. 218 is concerned with the statutory consultation requirements in relation to collective redundancies contained in the 1992 consolidation Act.
The amendments apparently accept that consultation rights should continue to be restricted to recognise trade unions but seek to put in place mechanisms whereby trade unions can be deemed to have been recognised. I hope that it will be helpful to the Chamber if I first set out the existing position.
As the transfer of undertakings regulations currently stand, an employer in a transfer is required to inform and consult with representatives of an independent trade union which he has chosen to recognise for the purpose of collective bargaining in respect of any employees who are affected by the transfer. That is the case whether or not the employees actually work in the undertaking which is to be transferred. Similarly, Section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 provides that an employer who proposes to dismiss one or more employees as redundant must consult representatives of any relevant trade union which he recognises for collective bargaining purposes. He must do that within prescribed time limits which depend upon the number of employees to be dismissed.
Where an employer has chosen to recognise a trade union for collective bargaining purposes, he is required to inform and consult the union's representatives when its members are affected by a transfer or proposed redundancies. The key words however are, "where an employer has chosen to recognise a trade union".
In company with my noble friend Lord Boyd-Carpenter I commend the ingenuity of the noble Lord, Lord Wedderburn, in finding another opportunity to press the case for statutory recognition arrangements. But he can be in no doubt about the Government's views on the subject. It is a fundamental principle of government policy that employers should be free to decide for themselves in the light of the circumstances and the needs of their business whether or not to recognise a trade union. My noble friend Lord Campbell of Alloway and I will have to continue to differ. I know that he holds his views very sincerely, but I do not share them.
I understand that the deemed recognition contained in the amendments would not be recognition for any purpose other than the information and consultation provisions of the transfer regulations or the statutory redundancy consultation provisions. Nevertheless, what the noble Lord, Lord Wedderburn, is seeking is irreconcilable with a fundamental principle of the present law on transfers and redundancy consultation. That principle is that the requirement to inform and consult a trade union arises only as a consequence of an employer's choice to recognise that union for collective bargaining.
The noble Lord, Lord Wedderburn, and the noble Baroness, Lady Turner, have suggested that the United Kingdom may be technically in breach of the acquired rights and collective redundancies directive because there is no statutory right to employee

735
representation for the purposes of the transfer regulations and the law on redundancy consultation. The Government do not accept that argument. Both directives define the employee representatives who must be informed and consulted as those provided for by the laws or practices of the member states—the words that the noble Lord, Lord Wedderburn, read out. In the United Kingdom it means representatives of recognised trades unions; that is, unions that an employer has chosen to recognise for collective bargaining, not ones that he has been deemed to have recognised for the purpose of the directive. Therefore, these amendments are unacceptable in principle.
Even if that is not the case it is very hard to see how the proposed mechanisms can possibly work in practice. Any employer planning a transfer or the making of redundancies who does not recognise a trade union for collective bargaining purposes will presumably have to call in ACAS to adjudicate on whether or not one or more unions shall be deemed to have been recognised. I very much doubt that ACAS would relish having to decide whether a union's representatives were suitable for such purpose. Noble Lords may be forgiven for wondering just what the criteria of suitability may be.
The amendment envisages that ACAS may for some unspecified reason recommend that a ballot be held. Such ballot will have to take place under rules approved by the certification officer, but the amendment offers no answer to a range of questions that will arise. Whose ballot will it be? Who will supervise and pay for it? Who will be the constituency? Thai and a great many other questions will arise. The overriding problem is that the involvement of ACAS and any necessary ballot will need to be arranged and to take place long enough before a transfer to allow the provision of information and adequate time for consultation. Does the noble Lord, Lord Wedderburn, really believe that it will make sense for the law to require a full-scale ACAS investigation, and possibly a ballot of the entire workforce, in a case where an employer proposes to make a single employee redundant? Does he believe that ACAS, having found the statutory recognition procedures unworkable —ACAS's own words in the late 1970s—will welcome having to determine, in the absence of any given criteria, whether or not a union shall be deemed to be recognised at a particular workplace?
It is quite clear to the Government that the result of these amendments can only be to make transfers of undertakings more difficult, with obvious implications for business efficiency and employment prospects, and to make it virtually impossible for employers to make employees redundant in accordance with the statutory consultation requirements. I suggest that the amendments cannot possibly be accepted, and I ask the noble Lord to withdraw them.
4.45 p.m.
Lord Wedderburn of Charlton: I thank my noble friend Lady Turner for her support and the noble Lord, Lord Campbell of Alloway, for his support in
736
principle. I also thank the noble Baroness, Lady Seear, for her support from the Liberal Benches. The noble Lord, Lord Boyd-Carpenter, compliments me for ingenuity. I think it is a compliment and I will take it as such. It does not need much ingenuity to look back at the 1975 machinery and devise something that makes it workable. Sometimes I am amazed by the narrow horizons in the Government's mind. When they see something that is imperfect they say that they cannot do anything better. I believe that my amendments are the beginnings of something better than the 1975 arrangements. It may not work perfectly, but it could be there. The central point, as made clear by the noble Lord, Lord Boyd-Carpenter, is that we must not deprive the employer of his discretion whether or not to recognise a trade union so that he can retain his ability to dismiss his employees. The Minister says that this is something that really cannot be done. Without going through them, there are other jurisdictions where legal support for recognition and negotiation has been fitted into the system.
I pass over the Minister's complaint that we will never know which union it is. That is fine for a government that is just passing a Bill to dispose of the Bridlington machinery. The Minister also asked who would pay for the ballot. That is rich since the Government have just withdrawn their promise to fund trade union ballots. I pass over those matters that need not stop us addressing the serious question. The directive says that the representatives of work people are those who are provided for by the laws or practices of the member states. What the Government have set out to do—and I put money on their not doing it—is to convince the court that if it is said that there is no practice and no law it means that they do not have to do anything and can simply dispose of the directive.
However, today the Minister has gone even further. Not only do the Government fail to address themselves to the repeal of the 1975 recognition measures in 1980—which was a unilateral government act disposing of a member state's obligations (they say) under the 1975 directive—but they also rely on the practice of there not being any practice. It is quite clear what the directive means. If one goes to Denmark and finds that 95 per cent. of the workforce is covered by the practice of negotiation, though the Commission may complain a little about the 5 per cent. one is obviously implementing the arrangement. Ours is not an industrial relations jurisdiction of that kind; it needs a legal prod, and it needs to get it right.
This amendment is the basis on which one can get it right. After discussions with my noble friends on the Front Bench, I will not withdraw the amendment.
3.47 p.m.
On Question, Whether the said amendment (No.204) shall be agreed to?
Their Lordships divided: Contents, 105; Not-Contents,143.

Division No. 1

CONTENTS

Airedale, L.

Jay, L.

Annan, L.

Jay of Paddington, B.

Ardwick, L.

Jeger, B.

Ashley of Stoke, L.

Jenkins of Hillhead, L.

Attlee, E.

John-Mackie, L.

Aylestone, L.

Judd, L.

Beaumont of Whitley, L.

Kilbracken, L.

Birk, B.

Kirkwood, L.

Blackstone, B.

Llewelyn-Davies of Hastoe, B.

Blease, L.

Lockwood, B.

Bonham-Carter, L.

Longford, E.

Boston of Faversham, L.

Lovell-Davis, L.

Bottomley, L.

Macaulay of Bragar, L.

Broadbridge, L.

McCarthy, L.

Bruce of Donington, L.

Mackie of Benshie, L.

Callaghan of Cardiff, L.

McNair, L.

Campbell of Eskan, L.

Mallalieu, B.

Carmichael of Kelvingrove, L.

Mayhew, L.

Carter, L.

Merlyn-Rees, L.

Cledwyn of Penrhos, L.

Molloy, L.

David, B.

Morris of Castle Morris, L.

Donaldson of Kingsbridge, L.

Mulley, L.

Donoughue, L.

Murray of Epping Forest, L.

Dormand of Easington, L.

Nicol, B.

Eatwell, L.

Ogmore, L.

Ewing of Kirkford, L.

Peston, L.

Ezra, L.

Prys-Davies, L.

Falkender, B.

Richard, L.

Falkland, V.

Robson of Kiddington, B.

Fisher of Rednal, B.

Rochester, L.

Gallacher, L.

Russell, E.

Galpern, L.

Sainsbury, L.

Geraint, L.

Seear, B.

Gladwyn, L.

Sefton of Garston, L.

Glenamara, L.

Serota, B.

Graham of Edmonton, L. [Teller.]

Shackleton, L.

Soper, L.

Gregson, L.

Stallard, L.

Grey, E.

Stoddart of Swindon, L.

Halsbury, E.

Strabolgi, L.

Hampton, L.

Taylor of Blackburn, L.

Hanworth, V.

Taylor of Gryfe, L.

Harris of Greenwich, L.

Thomson of Monifieth, L.

Hayter, L.

Tordoff, L.

Healey, L.

Turner of Camden, B.

Hilton of Eggardon, B. [Teller.]

Varley, L.

Hirshfield, L.

Wallace of Coslany, L.

Hollis of Heigham, B.

Wedderburn of Charlton, L.

Holme of Cheltenham, L.

Whaddon, L.

Hooson, L.

White, B.

Howell, L.

Wigoder, L.

Howie of Troon, L.

Williams of Elvel, L.

Hughes, L.

Williams of Mostyn, L.

NOT-CONTENTS

Aldington, L.

Carnegy of Lour, B.

Alport, L.

Carnock, L.

Annaly, L.

Cayzer, L.

Archer of Weston-Super-Mare, L.

Chalker of Wallasey, B.

Charteris of Amisfield, L.

Arran, E.

Chelmsford, V.

Ashbourne, L.

Cockfield, L.

Astor of Hever, L.

Colnbrook, L.

Auckland, L.

Constantine of Stanmore, L.

Belhaven and Stenton, L.

Cranborne, V.

Bessborough, E.

Croham, L.

Blatch, B.

Cross, V.

Blyth, L.

Cullen of Ashbourne, L.

Boardman, L.

Cumberlege, B.

Borthwick, L.

Davidson, V.

Boyd-Carpenter, L.

Denham, L.

Brabazon of Tara, L.

Denton of Wakefield, B.

Braine of Wheatley, L.

Derwent, L.

Butterworth, L.

Dundonald, E.

Buxton of Alsa, L.

Effingham, E.

Caldecote, V.

Ellenborough, L.

Campbell of Croy, L.

Elles, B.

738

Elliott of Morpeth, L.

Moyne, L.

Elton, L.

Munster, E.

Faithfull, B.

Murton of Lindisfarne, L.

Ferrers, E.

Nelson, E.

Flather, B.

Norfolk, D.

Fraser of Kilmorack, L.

Northbourne, L.

Gainford, L.

O'Brien of Lothbury, L.

Gardner of Parkes, B.

O'Cathain, B.

Gilmour of Craigmillar, L.

Oppenheim-Barnes, B.

Gisborough, L.

Orkney, E.

Goold, L.

Orr-Ewing, L.

Goschen, V.

Oxfuird, V.

Gray of Contin, L.

Palmer, L.

Gridley, L.

Park of Monmouth, B.

Hailsham of Saint Marylebone, L.

Peel, E.

Pender, L.

Harding of Petherton, L.

Prentice, L.

Hardinge of Penshurst, L.

Rawlinson of Ewell, L.

Harmar-Nicholls, L.

Reading, M.

Harvington, L.

Renton, L.

Hayhoe, L.

Rodger of Earlsferry, L.

Henley, L.

St. Davids, V.

Hertford, M.

St. John of Bletso, L.

Hesketh, L. [Teller.]

Seccombe, B.

Hives, L.

Shannon, E.

Holderness, L.

Sharples, B.

HolmPatrick, L.

Simon of Glaisdale, L.

Hood, V.

Skelmersdale, L.

Hooper, B.

Skidelsky, L.

Howe, E.

Strafford, E.

Hylton-Foster, B.

Strathcarron, L.

Johnston of Rockport, L.

Strathcona and Mount Royal, L.

Killearn, L.

Kimball, L.

Strathmore and Kinghorne, E. [Teller.]

Kimberley, E.

Knollys, V.

Sudeley, L.

Lauderdale, E.

Swansea, L.

Lincoln, Bp.

Swinfen, L.

Lindsay, E.

Tebbit, L.

Long, V.

Terrington, L.

Lyell, L.

Thomas of Gwydir, L.

McColl of Dulwich, L.

Trefgarne, L.

MacLehose of Beoch, L.

Trumpington, B.

Macleod of Borve, B.

Ullswater, V.

Margadale, L.

Vaux of Harrowden, L.

Marlesford, L.

Vivian, L.

Merrivale, L.

Wakeham, L. [Lord Privy Seal.]

Mersey, V.

Morris, L.

Wedgwood, L.

Mottistone, L.

Whitelaw, V.

Mountevans, L.

Wise, L.

Mowbray and Stourton, L.

Wynford, L.

Resolved in the negative, and amendment disagreed to accordingly.
3.56 p.m.
[Amendments Nos. 205 to 209 not moved.]
Lord Mottistone Lord Mottistone moved Amendment No. 210:
Page 47, leave out lines 22 to 24 and insert:
("(a) for paragraph (7) there shall be substituted—
"(7) any compensation awarded to an employee under this Regulation shall go towards discharging any liability of the employer under, or in respect of a breach of, the contract of employment insofar as both that liability and the compensation awarded are attributable to a period during which the employer did not perform his duty to consult.
Conversely, any payment made in discharging such liability to the employee by the employer shall go to reduce the amount of any compensation awarded under this Regulation insofar as that payment and award are similarly attributable to such a period." and").

The noble Lord said: In moving this amendment I shall also speak to Amendment No. 219. These amendments essentially deal with the same point—

739
that is, the preservation of the existing rules whereby industrial tribunals, when determining compensation for breach of the employer's obligation to provide information and to consult with employee representatives prior to a transfer of undertakings or a redundancy situation, may take account of payments already made to the employee under his contract of employment. At present, the law allows for payment made by the employer under the employment contract or for breach of that contract to be credited to the employer in his discharge of obligations to pay compensation for failing to consult on a transfer or to pay remuneration under a protective award. The converse also applies whereby payments under an award may be credited towards the discharge of contractual obligations. The Bill as it stands would remove this position, no longer allowing the set-off. The amendments seek to maintain the current position.
To take one example, under the existing law, if an employer dismisses employees as redundant without giving them due notice, he will, in addition to any statutory redundancy entitlement, be liable to pay damages for breach of their contracts arising from his failure to give the proper notice period on termination. That will usually reflect the loss of pay which each employee would have accrued during the notice period. Consequently, it is normal practice for employers to pay money in lieu of notice on termination as immediate compensation for the breach. In the event that a tribunal should subsequently rule that the employer failed to consult on the redundancies and award compensation for the protected period—that is, the notional period during which the employees' employment would have continued had there been proper consultation—it will take account of the fact that such payment in the form of pay in lieu of notice has already been received. Similar rules permit the offset of other contractual remuneration which relates to the period corresponding to the protected period.
If, as the Government propose, the tribunal will no longer be able to offset those sums, in our example the employer would be better off not making a payment in lieu of notice until such time as the tribunal has assessed compensation for failure to consult. That is because in any subsequent proceedings in the civil court to recover the payment in lieu of notice or contractual remuneration, the court will apply the general rule that damages reflect the loss which the individual has suffered and will take account of any payments awarded by the tribunal which are referable to the same period.
If by the time the court comes to do that, the tribunal has already awarded payment for the relevant period by way of the protected award, in many cases there will be no further loss to the individual and thus no liability for money in lieu. The net result of that scenario is that the only way in which employers will be able to ensure—if the Government's present proposal goes through—that the individual does not recover twice for the same loss, is not to make immediate payments on termination.
That is patently absurd both from the employers' and employees' perspective. The employers are quite prepared to pay their contractual liabilities, but there is no sense in making them liable for two sets of compensation for the same loss. The clauses in the Bill on redundancies and transfers do just that. My amendments seek to restore the original position.
This example has more direct application to the proposed Amendment No. 219 on redundancies since on the transfer of an undertaking there will be no need to pay money in lieu of notice. However, the principle remains the same since the compensation for breach of the consultation rules on a transfer is by implication referable to a period during which consultation would ordinarily have taken place and for which employees may already have received other contractual payments. It therefore follows that similar offsetting provisions should apply to avoid double recovery.
This is a complicated situation, as I am sure the Committee is aware. It is difficult to explain it clearly enough. But it is difficult to see why the Government are now attempting to remove an established part of the law as it applies both to transfer and redundancy. It is understood that the changes may have arisen consequent on a call from the European Commission requiring change to the UK law. If that is the case, I am not convinced that the Commission has made a case for such an amendment. But I will not at this stage pursue that particular argument. I beg to move.
Viscount Ullswater: I note from the groupings that Amendments Nos. 210 and 219 have also been grouped with Amendments Nos. 211, 213, 216 and 217. Therefore I shall address one or two of my remarks to those amendments as well. Each amendment in this group is concerned with the situation where an employer fails to consult with an appropriate recognised trade union, either about a proposed transfer or an undertaking or about proposed redundancies.
My noble friend Lord Mottistone has given an explanation of the law as it currently stands. Perhaps I may begin with the two amendments which he dealt with; namely, Amendments Nos. 210 and 219. Those amendments seek to prevent the Government removing the provisions to offset penalties for failure to consult unions. As I shall explain, the European Commission has informed the Government of its view that those provisions are not compatible with the acquired rights' and collective redundancies' directive and has referred the matter to the European Court of Justice.
The Government agree that the purpose of the penalty is not just to provide compensation for actual damage suffered by employees, but to create a sanction against employers who fail to consult. An employer dismissing employees as redundant or transferring them must do two things. He must pay any wages or pay in lieu of notice to which they are entitled and he must consult the recognised trade union. As the law stands it may well be that there is no penalty for failing to consult if the employer has paid the wages due to the employees.
There is thus no real sanction and the Government are obliged to ensure that such a sanction is provided

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under Community law. That being the case, I am sure that my noble friend Lord Mottistone will appreciate why the Government cannot accept his amendments. I believe that he will understand that we have accepted that the directive is not adequately implemented and that it is appropriate that we should put matters right by removing the offset of the protective award against wages. I also remind him that any employer who meets the requirements on consultation set by the directive will not risk incurring any costs at all. Therefore, having heard my explanation, I hope that my noble friend will agree that it would not be appropriate to press his amendments.
Perhaps I may now briefly turn to Amendment No. 211 tabled by the noble Lord, Lord Wedderburn. I do not know whether he wishes to speak to it or even move it. However, as it is on the Marshalled List, it is worth mentioning. The Committee may not be altogether surprised to see that that amendment attempts to go in the opposite direction to those of my noble friend about which I have just spoken. The amendment clearly does not dissent from the view that two weeks' pay is an insufficient maximum for compensation where an employer has failed to consult properly within the requirements of the transfer regulations. However, it seeks to increase it not to four weeks, which is the change which the Government recommend, but to 10 weeks. The Government have taken careful note of the Commission's argument and have doubled the size of the maximum possible compensation. We believe that it is right to do so. However, we do not accept that it is necessary or appropriate to go as far as Amendment No. 211. Therefore, I ask the Committee to reject it.
Lord Wedderburn of Charlton: Perhaps we may dispose of the matter by way of a question. The noble Viscount was kind enough to refer to the amendment standing in my name. Does he not agree that the principle is a little different from the way he put it? The Community principle is that for the breach of an obligation flowing from a Community instrument there must be, according to the European Court of Justice, something adequate in relation to the damage sustained and it must be effective and have a deterrent effect. Have the Government applied their mind to something which is effective and has a deterrent effect as a sanction against an employer who has so failed as regards the payment of two weeks' or four weeks' wages? To double something depends on where one starts. Twice nothing is nothing and twice two is four even in this Chamber and even when the Government advance it. The reason for 10 weeks is that it will be something more of a deterrent. Will the Government think again before Report as to whether they have really applied their mind to the European Court of Justice formulation of something effective and an adequate deterrent?
Viscount Ullswater: The Government believe that there is no reason to think that the European Court of Justice will find a maximum of four weeks' pay to be insufficient. An increase to 10 weeks' pay would clearly increase the potential burden on employers.
Lord Mottistone: The argument between my noble friend and myself is the degree to which we think that the European Commission is on good ground in requiring a change in our law. As I see it, we are not convinced that the Commission has made a case for such an amendment for the following reasons. In the case of Von Colson v. Land Nordrhein-Westfalen [1986]2CMLR/430, the European Court of Justice examined Article 6 of the equal treatment directive. The court held that the wording of the article, which states,
"Member States shall introduce into their national legal systems such measures as are necessary to enable all persons who consider themselves wronged … to pursue their claims by judicial process"
does not prescribe a specific sanction; rather, it leaves member states free to choose between different solutions for achieving the objective although the sanction must guarantee effective judicial protection. Where a member state chooses to penalise by award of compensation, that compensation must be adequate in relation to the damage sustained.
Lord Wedderburn of Charlton: I am obliged to the noble Lord for giving way. Will he now read out the line that he left out between the last two sentences?
Lord Mottistone: The noble Lord did not leave any lines out.
Lord Wedderburn of Charlton: Oh.
Lord Mottistone: The collective redundancies directive, amended by Directive No. 92/56/EEC, now provides in the new Article 5a that member states must ensure that judicial and/or administrative procedures for the enforcement of the directive are available. This, in terms, is similar to the article which was under consideration in the Von Colson case. To that extent, therefore, it would seem that the words of the European Court would apply equally to the collective redundancies directive; that is, put simply, so far as Von Colson is any authority at all on the issue, where the UK has chosen to penalise the employer by a compensatory protective award, that compensation must be adequate in relation to the damage sustained.
Clearly, that is exactly what the protective award is designed to do. Moreover, the very reason for allowing wages paid to be offset against the award is to ensure that the employee is adequately compensated for the damage sustained and to avoid double compensation. In my view the Commission has no grounds therefore for proceedings against the UK.
I hope that my noble friend the Minister will consider what I have put forward with a view to accepting that, although the wording of the amendment may have lots of room for improvement, the principle which I aim for—to guard against unreasonable double payments—is one that should be retained as far as practicable.
Lord Wedderburn of Charlton: Before the noble Lord sits down, I feel that there is some misunderstanding between us, and I apologise to him if there is. My version of the judgment states that the member state must ensure that compensation,
"is effective and that it has a deterrent effect, that compensation must in any event be adequate".

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Those words come from the judgment that I have. They are different from the noble Lord's. We can compare texts afterwards.
Lord Mottistone: Yes, but the noble Lord is better provided with legal quotations than I am. He is therefore able to quote more fully. However, the argument still stands up. I do not know whether my noble friend the Minister will wish to pursue the matter further at this stage: it would be helpful if he could.
Viscount Ullswater: I shall have to read carefully what my noble friend said. I must repeat that the Government agree that the purpose of the penalties is not just to provide compensation for actual damage suffered by employees but to create a sanction against employers who fail to consult. My noble friend and I may have some disagreement. I want to read what he said and consider it further. I cannot, however, give any undertaking that I shall be able to support a further amendment on the matter.
Baroness Gardner of Parkes: I do not wish to delay the Committee, but I must point out that the offset principle works well in practice. It is fair to both parties. If we find I hat people are not given their pay in lieu of notice, for the reasons quoted by my noble friend Lord Mottistone, that might adversely affect a number of people for a long period of time while waiting for a case to come to a hearing. I hope that my noble friend will take these comments into consideration also when he considers the text.
Lord Mottistone: I thank my noble friend Lady Gardner for her contribution, which strikes at the root of the problem. I differ from my noble friend the Minister on the degree to which the Commission or the European Court of Justice require the UK Government to do things and the degree to which, as my advisers tell me, they do not. I shall read with great care what my noble friend said. I am grateful to him for saying that he will do the same as regards my remarks. At this stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 211 not moved.]
4.15 p.m.
Lord Rochester Lord Rochester moved Amendment No. 212:
Page 47, line 27, at end insert:
("() This section shall not be brought into force by the Secretary of State under section 44 of this Act unless, prior to such day as the Secretary of State may appoint for such purpose, the Secretary of State shall have laid before both Houses of Parliament, and both Houses of Parliament shall have approved, further amendments to the Transfer of Undertakings (Protection of Employment) Regulations 1981 which shall have the effect of extending the application of paragraphs 10, 11 and 12 of such Regulations to representatives of "affected employees" (as therein defined) of a description other than one in respect of which an independent trade union is recognised by the employer concerned.").
The noble Lord said: In moving Amendment No. 212, I wish to speak also to Amendment No. 220. I should first assure the Committee and the noble Viscount, Lord Ullswater, that I have no intention of
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pressing either of these amendments to a vote. To do so successfully would mean delay in enacting Clauses 29 and 30, which is certainly not what I seek.
The Explanatory and Financial Memorandum to the Bill states that these clauses bring,
"detailed provisions of UK legislation … fully in to line with the EC Acquired Rights Directive",
and with the EC directive on collective redundancies, in the one case, on employees' rights on transfer of undertakings and related consultations arid, in the other, on consultations on collective redundancies.
I do not believe that that claim is justified. The Transfer of Undertakings (Protection of Employment) Regulations require employers to consult recognised trade unions about prospective transfers, but the acquired rights directive requires consultation with "representatives of employees". The European Commission has long argued that restricting the right to consultation and information to recognised unions is insufficient. I agree. The Government, however, have made no concessions on that point. The purpose of Amendment No. 212 is to persuade the Government to extend the right to employee representatives generally.
My difficulty is that it would be incredibly complex and indeed wrong to proceed by way of substantive drafting. As the noble Viscount said, the directive refers to employee representation provided for by the laws or practice of the member state—and there is no such law or practice in this country except in so far as there is a recognised trade union. In any case, I do not think that such drafting should be undertaken without consultation at least with employers' representatives. And that is a task, not for a party in opposition, but for the Government.
In other words, I have concluded that it is really up to the Government to be proactive in this matter rather than merely reactive, as they have been in framing Clause 29, and positively to promote "employee representation" outside the trade union structure—not in order to "do down" trade unions, but simply for the benefit of employees who do riot choose to be represented by a union.
Amendment No. 212 therefore invites the Government to lay before Parliament an order which would further amend the Transfer of Undertakings (Protection of Employment) Regulations 1981 and have the effect of extending application of the duty to inform and consult trade union representatives so that the regulations apply to employee representatives generally.
In the case of the proposed amendment to Clause 30—Amendment No. 220—the argument is the same as with the amendment to Clause 29. In this instance, however, the relevant EC directive, on collective redundancies, was transposed into UK law by the Employment Protection Act 1975, which is now consolidated in Sections 188 to 198 of the 1992 Act. Both the directive and the UK legislation require employers contemplating large-scale redundancies to inform and consult workers' representatives well in advance. That is of course what British Coal should have done recently under its own agreement with the

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NUM before announcing that it intended to close 31 pits without giving, in that case, 90 days' notice of the collective redundancies involved.
The European Commission considers that conducting negotiations only with representatives of independent trades unions recognised by the employer, as provided for in Section 188 of the 1992 Act, makes it possible for the consultation procedure to be completely inapplicable where no trade union is recognised by the employer. In other words, in that respect Clause 30 does not respond to the Commission's criticism that restricting the right to consultation and information to recognised trade unions is inadequate. Amendment No. 220 therefore asks the Government to lay before Parliament an order that would further amend Sections 188 to 192 of the 1992 Act, which would have the effect of extending the application of those sections to employee representatives generally.
Since the thinking behind the amendments is very much in line with the Government's often expressed support for the extension of employee involvement, I trust that the Minister will respond to them positively. If the Government acknowledge the need, as they do in bringing forward Clauses 29 and 30, for recognised trade unions to be consulted about prospective transfers and collective redundancies, they cannot very well fail to treat in the same way employees who do not choose to be represented by a trade union. Nor can it reasonably be claimed that commercial confidentiality might here be an inhibiting factor. There is no reason to suppose that employee representatives are any less capable than trade unions of respecting confidential information where that is involved. I beg to move.
Lord Boyd-Carpenter: The noble Lord has said that he does not proposed to divide on this amendment, and so I hope that he will not think it discourteous if I say that I do not see why we need to take very much time over it. I should like to put in a protest against the form of Amendments Nos. 212 and 220. What he does is ingenious. He says that the provisions of the Bill shall not come into force until some subsequent legislation, including amendments to other legislation, has operated. That is an ingenious way of sparing himself the problem of drafting amendments to other legislation, but it does seem to be a difficult way of proceeding. Apart from anything else, I hope that the noble Lord will not think that it is a good practice which should be followed by subsequent amendments to the Bill.
We must consider the Bill as it stands. It is wrong that we should seek to defer the operation of some of its clauses merely until some other totally separate legislation has been undertaken or regulations submitted. I hope therefore that we shall not spend much time on this practice.
Viscount Ullswater: I note of course what the noble Lord, Lord Rochester, said about not wishing to delay the passage of the Bill and therefore that he will not be pressing the amendments which would have that effect with regard to the two clauses.
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The amendments, like Amendments Nos. 204 and 218, which were discussed earlier, are about employee representation. Amendment No. 212 is concerned with identifying employee representatives for the purposes of the Transfer of Undertakings Regulations, while Amendment No. 220 is concerned with the statutory consultation requirements in relation to collective redundancies contained in the 1992 Consolidation Act.
I have already set out at some length the Government's views on that subject, and I shall not repeat the arguments that I have already advanced. I shall merely concentrate on the different approach adopted in the amendments. The amendments seek to provide that Clauses 29 and 30 should not come into force until Parliament has approved changes to the transfer regulations and the statutory redundancy handling provisions which would have the effect of extending information and consultation rights to any or all employee representatives.
There is some doubt as to whether the amendments as drafted are satisfactory for technical reasons. I note that my noble friend put forward his views, which I share, as to the right way to proceed, but I do not believe that this is the right moment to pursue that question. The main problem with the amendments is that they provide no clue as to how an employer would be able to judge who should, or should not, be considered to be an employee representative. That would surely cause considerable confusion. I appreciate that noble Lords who support the amendments wish Parliament to give further consideration to this question. I have to say, however, that the Government's view is entirely clear. Employee representatives for the purposes of these provisions should be trade unions which an employer has freely chosen to recognise for collective bargaining. I must therefore ask the noble Lord to withdraw the amendment.
Baroness Seear: Is the Minister really saying that an organisation, of which there are many, which has a works council to which people other than trade unionists are elected, as is the case, for example, in the German Republic, does not provide adequate machinery for the kind of consultation to which my noble friend referred?
Viscount Ullswater: What may suit Germany, may suit Germany. In my original reply I said the laws that pertain in this country are for the recognition of trade unions. That should be entirely at the option of the employer.
Baroness Seear: In many cases in this country there are works councils elected by employees. That being so, surely it is appropriate that they be used for this purpose.
Viscount Ullswater: There is no reason why an employer should not consult anyone he feels entitled to. What we are talking about is a statutory provision.
Lord Wedderburn of Charlton: Before the noble Lord, Lord Rochester, replies, I wonder whether I may mention two problems that I have with the

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amendments. The thrust of the amendments is in the same direction as mine. They require us to think of representatives of a description other than one in respect of which an independent trade union is recognised. That can mean two things: first, it is something other than a trade union. I apprehend that most of the bodies about whom the noble Baroness, Lady Seear, spoke would come within the definition contained in Section I of the new Consolidation Act as trade unions. Sc what are these bodies which are not trade unions? Secondly, the body can be something other than a trade union which is independent. Does the amendment envisage bodies which are not trade unions? That is technically difficult in view of the definition. And does it envisage bodies which are not independent?
Lord Rochester: r should first respond to the noble Lord, Lord Boyd-Carpenter. I find myself in a little difficulty here, but perhaps I should accept the compliment he paid me in terms of the ingenuity brought to bear in framing the amendments. I endeavoured to be open in what I said; that there was some difficulty in drafting. I said that it would be incredibly complex to draft a suitable amendment. I hope that I made it plain that my object in bringing forward the amendments was to persuade the Government to be pro-active in the matter rather than reactive, as it seemed to me that they had been in framing the clauses.
I was disappointed, to say the least, in the Minister's response, especially when he said that there would be some difficulty in defining the term "employee representatives". It seemed to me that my noble friend Lady Seear dealt with that matter adequately, in referring the Minister to those cases, many of them throughout industry, where works councils or similar bodies have been constituted. In answer to the noble Lord, Lord Wedderburn, I had in mind bodies such as works councils.
There may be technical faults in the amendments; indeed, the noble Viscount suggested that there were. Furthermore, it may be open to question whether Clauses 29 and 30 bring UK legislation fully into line with the relevant directive. Unfortunately, what is all too plain from the response of the noble Viscount is that the Government are not prepared to meet my basic argument that if there is a need for trade unions to be consulted about prospective transfers and redundancies that need should in principle be extended to employee representatives generally. In that way the Government could give effect to their professed support for employee involvement. I am sorry that they are unwilling to do so but, as I said at the beginning, I do not propose to press the issue and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Seear: Before the noble Lord, Lord Wedderburn, deals with his next amendment I wish to ask whether I am the only person who considers that the temperature in the Chamber is intolerable and that the air is suffocating. If we are going to be here until eleven o'clock we shall all be baked. Can steps be taken to see what is happening because I am quite sure
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that it is not right? We talk about health and safety at work but and it would be a pity if we were to boil ourselves.
Lord McCarthy: I agree with the noble Baroness.
Viscount Ullswater: I see that steps are already being taken. I hope that they will be successful.
[Amendment No. 213 not moved.]
Clause 29 agreed to.
4.30 p.m.
Lord Mottistone Lord Mottistone moved Amendment No. 214:
After Clause 29, insert the following new clause:
("Transfers
. In Schedule 13 to the 1978 Act (computation of period of employment), after paragraph 12 there shall he inserted—

"13.—(1) Where—

(a) a trade, business or undertaking is transferred from one person to another;

(b) at the time of the transfer, a payment calculated in respect of the period of service with the transferor is paid to the employee on the basis that he is redundant (this payment not being a payment referred to under sub-paragraphs (2) (a) (i) and (2) (b) (i) of paragraph 12 but being at least equivalent to such a payment); and

(c) the contract of employment under which the employee was employed is transferred from the transferor to the transferee in accordance with Regulation 5 of the Transfer of Undertakings (Protection of Employment) Regulations 1981 (the 1981 Regulations),

then in determining, for the purposes of Section 81(1) or Schedule 4, the period for which he has been continuously employed, the continuity of the period of employment shall be treated as having been broken as at the date on which the transfer took effect.

(2) in this paragraph, references to "transferor" and "transferee" shall be construed in accordance with the 1981 Regulations." ").

The noble Lord said: I too was finding that my waistcoat was too much of a garment. The amendment is designed to remove uncertainty in the existing legislation governing employment rights in the transfer of an undertaking. It arises from the difficulty in interpreting whether a particular transaction amounts to a relevant transfer for the purpose of the Transfer of Undertakings (Protection of Employment) Regulations 1981.
Before I make my case perhaps I may give the Committee an example of what I am talking about. Let us say that an employer wishes to put out to contract a particular service such as cleaning, which is currently carried out by in-house staff. The employer and the contractor both take the view that the arrangement does not amount to a transfer of an undertaking. The employees are not dismissed as such but are merely advised that a contractor is taking over the service and that they should consider applying for positions with the contractor who is anxious to take on existing personnel. The employees do that and all are offered jobs with the contractor, which they accept. The contract duly takes effect and the employer, believing there to be no transfer, subsequently makes redundancy payments to the employees concerned.
Let us further say that some two or three years into the contract the contractor finds the need to reduce staff and dismisses as redundant one employee who

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brings proceedings in the industrial tribunal claiming a redundancy payment. He argues successfully that, despite the views of the employer and the contractor, the award of the contract constituted a transfer of an undertaking and that under the TUPE regulations and paragraph 17 of Schedule 13 to the Employment Protection (Consolidation) Act 1978 his contract has in effect transferred to the contractor with full continuity of service.
That means that because there was no dismissal as such by the original employer the payments made on transfer did not in law constitute statutory redundancy payments. Consequently the usual rule whereby previous statutory redundancy pay can be taken into account when assessing subsequent entitlement—and I refer to paragraph 12 of Schedule 13 to the 1978 Act—does not apply. The employee can therefore recover a payment based on his entire period of service with both employers even though he has in effect already received a proportion of that, which relates to his first employment.
My noble friend will be aware of the major anxieties held my many organisations about the question of whether the regulations will apply in certain circumstances; for instance, those which I have outlined. That has particular relevance where a service has been contracted out by the main employer and thus has important implications for those involved in compulsory competitive tendering in the public sector. In essence, contractors will in many cases now be required to observe terms and conditions applicable in the public sector which will inhibit the contractors' competitiveness and freedom to tender for particular work. There is no doubt that the issues raised in this area are complex and the source of the uncertainty rests with the Acquired Rights Directive and the interpretation given to it by the European Court, where the failure to spell out the distinction between contracting out in both public and private sectors and the genuine transfer of an undertaking, whether commercial or otherwise, leaves employers in a state of confusion.
My right honourable friend the Attorney-General has confirmed that the interpretation of the law in this area depends to a large extent on case law in domestic tribunals and courts and in the European Court of Justice. He has confirmed further that the contracting out of a service is not a transfer unless it involves enough of the elements of the original operation—such as premises, staff, goodwill and customer base—to constitute the transfer of a going concern. No single one of those elements is essential for there to be a transfer of an undertaking. The overall picture needs to be examined. In practical terms, it is difficult to see at the pre-tender stage whether a tribunal, a domestic court and ultimately the European Court of Justice would decide that any particular contract award would constitute a transfer of an undertaking. Therefore, contractors tendering for public and private sector work will be uncertain about whether they must assume the obligations of a full transfer.
Ultimately the answer lies in revising the European Community Acquired Rights Directive so as to avert
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a grave threat to contracting out. However, in the interim an amendment to existing legislation may be necessary to address the situation where, because of the uncertainty, the transferor, the employer, mistakenly believes that a transaction is not a relevant transfer but rather treats it as a redundancy situation and makes redundancy and/or other severance payments to employees who are subsequently engaged by the transferee.
Under the existing rules on continuity of employment, should the transferee subsequently make the transferred employees redundant it is unclear whether he will be liable for redundancy payment based on the entire period of service with both employers. My example gave point to that. It is possible that where prior redundancy payments have been made paragraph 12 of Schedule 13 will not be interpreted as breaking the continuity in those circumstances. If that is so the effect could be that in addition to the dual costs to employers, which could be substantial and unbudgeted, the employee is doubly compensated for the same period of service. Clearly, that would be inequitable. This amendment is aimed at clarifying the point that where payments at least equivalent to statutory redundancy compensation have been made those will be taken into account when calculating future redundancy entitlement payable by the transferee. There is clearly some uncertainty as to whether payments made in those circumstances are covered by paragraph 12. I believe that for the avoidance of doubt the Government should take the opportunity to clarify the matter and approve my amendment. I beg to move.
Lord Wedderburn of Charlton: There are two points that I wish to make in answer to the noble Lord. I make them only because the iron discipline portrayed by my noble friends and myself meant that we passed over certain amendments which would have placed my remarks on the record. Therefore, in view of the arguments put forward by the noble Lord, Lord Mottistone, I shall make those points now.
Both points relate to the noble Lord's complaint about the interpretation concerning the European Court of Justice not serving the interests of employers for which he wishes to alter British law. In both respects, the amendment flows against the tide of both recent and earlier interpretation. First, in a quite recent decision in the case of Katsikas v. Konstantinidis from the German courts, the European Court of Justice held what many had argued—although I did not —that the directive allows the employee an option on a transfer of undertaking; that it does not necessarily amount, as in paragraph (c) of the amendment, to a transfer of the contract of employment without the employee being allowed a view unless national law is quite clear on the matter. It is dangerous to make an amendment to the national law which would, by a side wind, as it were, decide that issue which should be decided in the face of all the Community and national considerations. Therefore, it would be quite improper for the Committee to consider paragraph (c) at this point.
Secondly, in terms of what is a transfer of undertaking, decisions such as that in the Rask case in

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the European Court of Justice have made it quite clear that some contracting out may well be a transfer of an undertaking if there is retained that unity of the economic entity which was found to exist in many such cases. We should have preferred the unit of economic entity to have been removed by our amendments. However, in view of those considerations I submit that the Government cannot consider the amendment in its present form at this time.
Viscount Ullswater: Amendment No. 214 takes us into a rather complicated area of the law. It is intended to address a situation which my noble friend believes might arise as a result of uncertainty about whether the transfer regulations apply in a particular case.
What concerns my noble friend is the possibility that redundancy payments may be made in error. The situation which I believe he has in mind, as I understand it, is one in which the transfer of an undertaking covered by the transfer regulations takes place but the old employer mistakenly believes that the regulations do not apply and consequently makes redundancy payments to employees who are subsequently employed by the new employer.
My noble friend is concerned that paragraph 12 of Schedule 13 to the 1978 Act would not operate to break continuity in such circumstances because the payment made by the old employer was not a statutory redundancy payment as the employee was not actually dismissed as redundant but had his contract of employment automatically transferred to the new employer. My noble friend fears that that would mean that the employee's continuity of employment for redundancy payment purposes would be unbroken. If the new employer had to make him redundant in due course, that might result in both employers making payments for the same period of service. That would result in the employee being doubly compensated.
I can understand why my noble friend takes the view that this would be inequitable. Nevertheless, the legal advice that I have received is that the situation which he envisages would not happen in practice. I am advised that a statutory redundancy payment, as defined in the 1978 Act, does not cease to be such because it emerges subsequently that the regulations applied and that a statutory redundancy payment breaks continuity so that no double payment would be made even if the regulations apply.
Where an employee is dismissed on the grounds of redundancy, he is entitled to a redundancy payment. I am advised that if there is later found to be a transfer, that transfer does not nullify the dismissal. It has the effect that the employment of contract was continued but it does not have the effect of removing the entitlement to any payment which may have been made. That payment would therefore count as removing entitlement to any later payment for the same period.
I have listened carefully to the representations made by my noble friend. The Government do not share his view of the legal position. Nevertheless, in view of his obvious anxiety, I shall give further consideration to whether it would be advantageous to make the position absolutely clear. If that seems to be
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advisable, the Government will introduce an amendment along the lines proposed by my noble friend on Report. I hope that my noble friend will agree to withdraw the amendment on that understanding.
4.45 p.m.
Lord Mottistone: I am grateful to the Minister for his closing remarks. As I understand it, the advice given to the CBI—and the Committee knows that the CBI advises me—is at variance with that supplied to the Government. The CBI has taken counsel's opinion on this matter. Therefore, there is room for further discussion within that kind of field. I am most grateful to my noble friend for his undertaking to look closely at the matter and to bring back an amendment on Report if he believes that to be appropriate in all the circumstances. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 30 [Redundancy consultation procedures]:
[Amendments Nos. 215 to 220 not moved]
Clause 30 agreed to.
Clause 31 [Repeal of Part II of Wages Act 1986]:
Lord Eatwell Lord Eatwell moved Amendment No. 221:
Page 48, line 41, at end insert ("in those trades in which two-thirds of the workers receive remuneration, over the period of a year, substantially in excess of the statutory minimum established by the wages order made by the wages council for that trade.").
The noble Lord said: This is the first in a series of amendments which we are to discuss on Clause 31, the clause in the Bill which would abolish wages councils. There have been a number of extraordinary aspects of the passage of this clause. In another place two former Conservative Ministers from the Department of Employment voted against the Second Reading of the Bill on the grounds that it contained this clause.
Another extraordinary aspect of the passage of the legislation is that neither in another place nor in your Lordships' House have the Government managed to produce any substantial evidence whatever in favour of the measure which they propose. We have heard from the Secretary of State and from the noble Viscount a range of assertions and a raft of prejudices but hardly a shred of evidence.
On Second Reading four weeks ago, I asked the noble Viscount for some evidence to back up his assertions. He merely rebuked me for asking too many questions. In those four weeks since the Second Reading debate, I have not received a single item of correspondence from the Department of Employment addressing my questions. I look forward to hearing some answers today.
Despite the unwillingness or perhaps the inability of the Government to make a case for the abolition of wages councils—and that inability probably explains the absence of this measure from the Conservative election manifesto—I have put forward an amendment in the spirit of compromise. It is an amendment which meets the Government half way by adapting their own criterion for the abolition of wages councils.
On Second Reading in another place the Secretary of State for Employment asserted that:

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"Two thirds of employees covered by wages councils are paid well above the statutory minimum rates laid down by the councils".—[Official Report, Commons, 17/11/92; col. 177.]
On Second Reading in this Chamber the Minister likewise asserted that:
"Some two-thirds of wages council workers are paid significantly above minimum rates".—[Official Report, 1/3/93; col. 427.]
It is clear that the Government believe that those propositions are sufficient to establish that wages councils are no longer needed. I do not agree but I am prepared to give the Government the benefit of the doubt.
My amendment would require that instead of the Government's criterion of two-thirds of workers being paid well above the minimum being applied to all wages councils taken en masse, it should be applied to each trade individually. Hence if in one trade—let us say the famous ostrich and fancy feathers trade—over two-thirds of the workers are paid substantially above the minimum, then the wages council could be abolished. However, in the case of the retail non-food wages council my researches suggest that fewer than half the workers are paid substantially above the minimum, and the wages council would, on these grounds, be retained. I hope the Minister will agree that this is a constructive application of his and the Government's own criterion. I hope that he accepts the amendment or at the very least the spirit of the amendment. Of course this amendment would have the effect of preserving some wages councils in industries in which wages are particularly low. The Minister may feel that he should resist the amendment on other grounds. Those grounds have been well rehearsed.
First, the Government have claimed that abolishing wages councils will, by allowing wages to be cut, create jobs. On this point, my earlier criticism of the Government for presenting no evidence to back up their assertions is, I must confess, a little unfair. On 4th November last the Under-Secretary of State for Employment, Mr. Patrick McLoughlin, having faced repealed demands for evidence from his honourable friend Mr. Peter Bottomley to back up his assertion that wages councils destroy jobs, presented Parliament with a list of 26 studies. He must have thought that no one would read them because the remarkable fact is that of the 26 studies, only six supported the Government's case, and of those six, four were actually prepared by government departments. The remaining 20 studies were either inconclusive or found that wages councils had no adverse effect on employment at all. By the production of this list, the Government not only managed to shoot themselves in both feet but they deposited the smoking gun in the House of Commons Library.
I should add that the finding that wages councils do not reduce employment is not surprising to any serious student of economic theory. In general, economic analysis suggests that we would not necessarily expect there to be any impact on employment. I will not detain the Committee by giving the details of the argument; but I can assure the Committee that it suggests the results would be
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inconclusive, as indeed empirical research shows they are. I conclude therefore, with the aid of the Department of Employment—I thank that department for preparing its list—that my amendment will not threaten jobs.
The Government have also argued that wages councils are not a means of alleviating poverty. This is the famous "pin money" argument. As the Secretary of State argued in another place, 80 per cent. of the employees the wages councils cover live in households with two or more incomes. As the noble Viscount elaborated, the plain fact is that wages council workers are spread right across the income distribution. Both points are correct but both are completely irrelevant.
As regards the 80 per cent. point, roughly the same proportion of workers, whether in wages council industries or not, work in households where there is more than one income. That applies to everyone, not just those in industries covered by wages councils. That fact does not distinguish them. The noble Viscount also made the point that wages council workers are spread throughout the income scale. While it is true that some wages council workers live in the wealthiest households in the land and they are spread right across the income distribution, it will not surprise the Committee to hear that they are predominantly concentrated in the lowest income groups.
To tackle the question of poverty seriously, I have used the empirical analysis of income distribution of the Department of Applied Economics at Cambridge. That work not only studies the distribution of gross incomes but also the impact of taxes and benefits on net incomes. The relevant results are as follows. First, 27 per cent. of all workers earning wages in the wages council range are in the bottom 10 per cent. of families. Secondly, a fall in wages of just 30p an hour would reduce those families' incomes by 7 per cent., having taken account of all the changes in taxes and benefits. I remind the Committee that this 10 per cent. is exactly the bottom 10 per cent. that the noble Lord, Lord Henley, said in this Chamber on 24th February have seen no increase in their real income at all since 1979. Now the Government propose to reduce the income of a quarter of the families in this group.
I conclude that my amendment, by preventing wages falling in those industries in which wages councils are retained, will help alleviate poverty. My amendment will also mean that the Exchequer will be relieved of the cost of subsidising inefficient employers via family credit. I have calculated that the total abolition of wages councils would have a net Exchequer cost of up to £400 million. My amendment would save the Government roughly £300 million. Is the Chancellor of the Exchequer aware that the noble Viscount is proposing to spend £400 million? Will he tell us why he is prepared to throw this money away?
This amendment, by preserving wages councils in those industries—and those industries only—in which wages are clustered around the minimum level will preserve jobs, alleviate poverty, save the Exchequer £300 million and allow the Government to use their

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own criterion for the abolition of the councils. I hope the Government will accept the amendment in the constructive spirit in which it is offered. I beg to move.
Baroness Turner of Camden: I rise to support the amendment moved so ably by my noble friend this afternoon. The Committee will be aware that we on this side of the Chamber are opposed to the abolition of wages councils. We have said so on many occasions in the past and of course on Second Reading. We know that wages councils are not perfect. We have never said that they were. We know also—the Minister will no doubt remind us of this again this afternoon—that Labour administrations have abolished wages councils in the past and that not all unions have always been in favour of them. But that is because they have been seen as an interim measure until proper collective bargaining arrangements could be established. It was never the intention that the interim period should be followed by abolition and absolutely nothing, else. However, that is more than likely to be the situation if the Government proceed with their objective as set out in the Bill and do not accept the amendment moved by my noble friend.
The Government have actively discouraged collective bargaining and made it much more difficult for unions to organise than it was prior to the extensive programme of industrial relations the Government embarked upon in 1979. Wages councils now cover 2.5 million workers—one-eighth of the workforce. Large numbers of those workers are women and many are from ethnic minority groups. In other words, they are among the most vulnerable workers and that is why they need some form of state protection. These women are not in the main working for pin money, either. Even so, wages council rates are not very high. They range from £2.63 an hour in the clothing trade to £3.08 per hour in food shops. The Government have claimed, first, that the existence of wages councils is inimical to job creation; and, secondly, that their abolition would not lead to pay cuts. I should have thought that was an inconsistent argument because it seems to me that the only economic, as distinct from moral, argument for doing away with them would appear to be that it would free employers to pay less than they would otherwise have to do. I believe that is the real reason for abolition.
Further, it has been frequently claimed by the noble Viscount that wages councils have outlived their usefulness. It is said—my noble friend has said this this afternoon —that two-thirds of the workers covered by wages councils already receive wages in excess of the wages council minimum. It seems to me that here is the justification for the amendment moved by my noble friend Lord Eatwell. He is suggesting that if this is really so, then wages councils could be abolished in those trades in which it is demonstrated over a period of a year that two-thirds of the workers are receiving remuneration in excess of that established by the wages councils.
I would suggest to the noble Viscount that this provision gets the Government off the hook. They would have the opportunity, given this amendment, of proving their case far abolition. The threat to abolish wages councils has raised enormous ire and the
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anxiety of numerous organisations. The Government must be well aware that a substantial amount of lobbying has been carried out while the Bill has proceeded through both Houses of Parliament. Therefore, I hope that if the Government cannot be persuaded to depart from their ultimate objective, they will at least give sympathetic consideration to the proposition advanced by my noble friend this afternoon.
5 p.m.
Baroness Seear: I should also like to support the amendment. I do not believe that wages councils are ideal instruments for setting wages. In many ways they were never intended to be. As has been said so often, they were an interim measure. However, it seems an extraordinary moment to choose to get rid of them when we have 3 million people unemployed and a great many people need to earn these very small sums.
I should like also to take the greatest exception to the argument that was put forward by the Secretary of State that it did not matter much because so many of the people involved were not in poverty and there were other wage earners in the household. When did we ever consider that pay should depend on family income or on need? If one once follows that argument one's whole wages policy is in tatters. Pay has to be for the job done. It does not have to bear a relationship to whether there is someone else in the household bringing in some money. That is an argument which gets one nowhere.
I should like also to emphasise the point that a great many single women and single parents—because people working in the wage council industries are largely, though not entirely, women—are dependent on that money. As everybody knows, they are some of the people in the greatest poverty at present. This is no moment to remove that safeguard.
In some ways I can understand why the noble Lord, Lord Eatwell, made his concession. However, I am sorry that he has done so because protective legislation of this kind is always meant for those who are falling through the net. It is meant for the one third of the employees who are not in the higher paid group to which the noble Lord referred. I accept the amendment and I know why he has done that, but it leaves unprotected some people who are at the very bottom of the pile. This is no moment to bring forward this change.
Lord Boyd-Carpenter: It is known that Members of the Committee opposite are against the proposal in the Bill for the abolition of wages councils. However, the Committee is also aware of the fact that many of us on this side of the Chamber have, over the years, seen the reduction in the scope of wages councils and have urged on the Government the importance of abolishing them. There is, therefore, a clear-cut line of division between us. The amendment, although no doubt it is an ingenious attempt to suggest that it is something of a compromise, is apparently a last minute attempt to salve wages councils.

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I should like to say a word on the merits of the issue. Wages councils are a form of statutory wage fixing. It is well known, and I believe generally agreed, that statutory wage fixing creates unemployment.
Noble Lords: No!
Lord Boyd-Carpenter: Wages councils seem to some of us to have the effect of creating unemployment. Let me put this argument to Members of the Committee who said "No".
In this country there are many people who are partially disabled, with physical limitations, who cannot work a full week and therefore cannot expect a full week's pay. However, they are capable of doing a limited amount of work. They are anxious to do so. It enables them to earn a certain amount which they would not otherwise earn at all. Does the noble Baroness desire to intervene?
Baroness Turner of Camden: I do. Does not the noble Lord recall the disability working allowance, which was introduced by this Administration with the support of this side of the Chamber, which is intended to deal precisely with that point?
Lord Boyd-Carpenter: It does not deal with the question at all. The position is that there are people who cannot earn a full statutory minimum wage for reasons of physical limitation but who can nonetheless earn a certain amount through a partial week's work. Perhaps the noble Lord will contain himself for a moment. Those people would be denied the opportunity to work if their area of work were covered by a wages council. Does the noble Lord wish to speak?
Lord McCarthy: The noble Lord is making assertions again. He says that there are such people but he never produces any evidence. It seems to me that he is actually talking about people who work part time and who are paid so much an hour. There is no earthly reason why they should not be paid wages council rates. A large number of the people he is talking about are paid wage council rates.
Lord Boyd-Carpenter: Exactly. If one lays down that they must receive wages council rates one is denying them employment. That such people exist is within our own knowledge. I myself know several such people in my own part of the country. I shall just finish what I have to say. I am responding to a challenge by the noble Lord opposite, so perhaps the noble Baroness will contain herself. The position is that there are plenty of such people. I know many of them personally. They are incapable of doing a full week's work yet they can do a limited amount of work. That would be denied them in a wages council industry. That is the problem which the noble Lord opposite does not seem prepared to face. Does the noble Baroness now wish to come in?
Baroness Seear: I may be being very stupid, but I fail to follow what the noble Lord is saying. If in hairdressing, which is a wages council industry, a slightly disabled young woman works two days a
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week, she receives two-fifths of the wages council weekly rate. She is paid by the hour for the time she works. Despite the fact that she cannot work for a full week she still receives wages council rates, but for the time that she works. There may be many arguments against wages councils but for the life of me I cannot see the point put forward by the noble Lord, Lord Boyd-Carpenter, as one of them.
Lord Boyd-Carpenter: The noble Baroness has not understood the position. It is quite clear that if, owing to a disability, one is unable to work for continuous periods and can work only intermittently, one does not receive the daily wages council allowance because that would be in breach of the legal provision for wages councils. That is what the noble Baroness and noble Lords opposite must face. For that reason, as for several others, wages councils generate unemployment because there are a number of people who can and would like usefully to work but are unable so to do because of deficiencies of one kind or another—physical or perhaps in some cases mental. Therefore it is the greatest mistake to keep the wages councils in existence.
Wages councils are a means of creating unemployment by imposing an artificial rate of pay, which is not related to the value of the work but simply arbitrarily laid down by the wages councils themselves. Therefore, I very much welcome the fact that the Government have now decided finally to abolish those councils. They do not serve a useful purpose. They have many of the disadvantages of statutory minimum wages which we have seen in other countries.
Therefore, I hope that the amendment will be firmly rejected, that we shall proceed with the clause as it stands and that wages councils will therefore be properly abolished when the Bill becomes law. That will be a great improvement, help the working of our economy and help a great many people in this country.
Lord Murray of Epping Forest: Before the noble Lord sits down, I wish to say that I am genuinely puzzled by his argument. I am sure that he knows people with disabilities in his locality who would very much like to work full time. I believe that all of us know such people. Will the noble Lord identify the employers to which the people to whom he referred applied and the trades in which they have failed to find part-time employment because a wages council order prohibits the employer from employing them? Is that what he said?
Lord Boyd-Carpenter: The noble Lord nearly has it right. I was saying that where one has a statutory minimum wage—in other words, a wages council ruling—there are categories of people who are denied employment because, quite frankly, to an employer they are not worth the statutory minimum wage, but who could do a useful job of work in return for quite reasonable remuneration if one had freedom of negotiation and of bargaining.
Lord Murray of Epping Forest: Will the noble Lord tell us what trades these people belong to? He has talked to people who have complained that they could

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not obtain a certain kind of employment because of the wages councils. What are the trades that they have tried to get into but have been prohibited from entering? I do not know them.
Lord Boyd-Carpenter: There are many. For example, there is gardening. That is a very useful part-time occupation. It is no use the noble Lord shaking his head, he simply does not know. Perhaps the noble Lord, Lord McCarthy, will contain himself.
Lord McCarthy: Perhaps I may—
Lord Boyd-Carpenter: Perhaps the noble Lord, Lord McCarthy, will wait a moment. Noble Lords are so excited by their love of the wages councils that they seem to be losing control of themselves. I was responding to the noble Lord seated behind him. In my own experience I have encountered these people. Gardening is one type of employment; that of attendant at public houses and restaurants is another. The inflexibility which wages councils impose, with the inflexible fixing of an amount of remuneration laid down not as the result of bargaining or of the study of the worth of people's work but quite arbitrarily by wages councils, denies those people employment. If the Committee were to decide to throw out the clause —I hope that it will not—the Committee would be responsible for creating quite a bit of unemployment.
Lord Skidelsky: I hope that the Government will resist the amendment moved by the noble Lord, Lord Eatwell. The purpose of the amendment is this. Clearly, the noble Lord would like to use wages councils to protect the incomes of the lowest paid workers. I agree with him that some groups need to have their income protected. The sole disagreement is about the mechanism by means of which that protection is afforded. I do not believe that wages councils are an efficient method of doing that. The standard minimum rates are not an efficient way of dealing with poverty because of the lack of fit between individual wage rates and the incomes of households. As a general proposition that is quite true. There are some groups to which the proposition does not apply. Individual wage rates are not proxies for household incomes. That point has not been grasped by the noble Lord. Household income depends on the number of income earners; that has been referred to. It depends on the number of dependants; that has not been referred to. It depends, too, on the housing circumstances of the families, including their location.
It is perfectly true that the income of some groups needs to be protected. I am aware of single parents, for example, who rely on wages councils incomes. But there are better ways of dealing with those groups. In that particular case, there is no reason why income support should not be targeted through family allowances. In each particular case one will find ways of dealing with the problems of poverty that are better than interfering in the bargaining between employees and employers. Those interferences inevitably distort the working of the labour market. I hope that we shall have an opportunity later to discuss the more general claim made by the noble Lord that wages councils do not tend to reduce the amount of employment.
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If the general argument for abolishing wages councils holds, it should apply to all employees covered by the wages councils. The attempt to separate them out by level of income in any particular wage council industry is not an efficient or correct way to proceed.
I wish to take up one other point made by the noble Lord. I ask it in the form of a question. Do his estimates of increased cost to the Exchequer—he referred to a figure of £300 million as a result of the abolition of wages councils—take into account the possibility of increased employment resulting from the abolition of those councils, which would represent a saving of dole money to the Exchequer, or do they assume that employment will remain entirely unaffected? That is an important question. What is at issue is the net cost to the Exchequer and that depends on assumptions made about employment. I hope that the Government will resist the amendment.
5.15 p.m.
Lord Campbell of Alloway: On this occasion, apparently it being an enforced privilege on these Back Benches to be able to follow my noble friend Lord Boyd-Carpenter, I enter into the conflict of controversy. I greatly admire the courage and tenacity of my noble friend in defence of his opinions. By and large, I share some of them. But, broadly speaking, my approach is much nearer to that of the noble Lord, Lord Skidelsky. In essence he stated that there are better ways of dealing with the problem of low wages. All noble Lords care about that problem. It is a problem that has to be recognised and met. That, I accept. However, there are better ways of dealing with it than keeping the wages councils. That is where I take my stand, which I believe is not the stand taken in argument by my noble friend.
When the wages councils were set up to deal with the problem of sweated labour—the) did a magnificent job—there was no social security. We now have a welfare state. The element of the adverse effect on employment to which my noble friend Lord Boyd-Carpenter rightly refers is surely better met under extant social conditions, by the welfare state provisions, than under the wage council provisions which now, with respect to noble Lorcls on the other side (I always entertain respect for noble Lords on the other side) have become an anachronism. They have produced anomalous results. They are becoming out of date.
The noble Baroness, Lady Turner, referred to the abolition of wages councils—I believe that it was at Second Reading—as perhaps the most controversial aspect of the Bill. As a prophetess of renowned repute, her reputation has not flagged on this occasion. I am not sure whether, in speaking to the amendment, in effect one should speak to the Question whether the clause as a whole should stand part. But as all Members of the Committee have apparently done so, I suppose it is right to continue. In any event, I believe that the aspects of the controversy which have arisen are subsumed in what I was going to say—if the time came to say it—on whether Clause 31 should stand part. For the reasons that I shall then give—and I shall

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not weary the Committee with any formal repetition —I am satisfied that it is now time to abolish the wages councils.
The reasons for opposing the amendment are subsumed in the reasons that I support Clause 31. It goes without saying that I accept the constructive and wholly sincere spirit in which the amendment is proposed. But it is proposed on the basis that the wages councils are not abolished. For the reasons which I shall give, if they become relevant or appropriate, in my opinion the councils should be abolished. There is nothing further useful for me to say.
Lord Gilmour of Craigmillar: The division is not so clear-cut as my noble friend Lord Boyd-Carpenter said. When the subject was discussed in another place, the only two Back-Benchers who spoke on the Government's side were against the abolition of wages councils. Both had been in the Department of Employment, occupying the place which the Minister now occupies. Both knew a great deal about the matter. I do not have that advantage or experience, so I am still not clear about a number of matters. I hope that my noble friend will be able to enlighten me.
I am still not clear what happened between the election in 1992 and today which has produced the proposal to abolish wages councils. It was not mentioned in the Conservative manifesto, and the Secretary of State at the time said that he had no immediate plans to abolish them. That phrase has become over-familiar during the past week or two. Nevertheless, I wish to know what has happened since the election that has brought this change of heart by the Government.
I support the amendment of the noble Lord, Lord Eatwell, because it seems to me that the only conceivable point of the clause is to lower the wages of those who are already very low paid. There can be no other point in it. That is what happened when the equally retrograde measure of 1986 took away all protection from the young. Since then their pay has declined sharply with no noticeable benefit to the economy.
I wish to know why the Government think that people who are already low paid should be paid less. It does not seem to me to be at all in the spirit of Tory philosophy, as I understand it, which is that the Government should take steps to look after the people who are least able to look after themselves. The clause takes away the remaining protection that they have.
As the noble Baroness, Lady Turner, said, it will particularly hit women because they form over 75 per cent. of those affected by the wages councils and they will be badly damaged. Some of my noble friends seem to believe that the matter can be dealt with by the low paid being subsidised by social security. That seems to me a very odd doctrine, I am not sure why taxpayers should subsidise bad employers. It does not seem to me to be either economically or politically a good idea.
Furthermore, I should like my noble friend to tell me how reducing the pay of the low paid will achieve the Government's ambition of a classless society. I am not quite sure exactly what a classless society is or
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would be, or how it can be achieved. However, assuming that it can be achieved, I should not have thought that the most promising means of achieving it was to lower the pay of the low paid. Therefore, it seems to me that there is considerable incoherence or inconsistency in the Government's policy.
As the noble Lord, Lord Eatwell, said, there is no evidence at all that wages councils reduce employment. It is merely stated as a matter of free market dogma that people should have freedom of contract. Of course there is no freedom of contract between a reasonably powerful employer and a totally powerless employee who may be very badly educated. There is no evidence at all that I can see—and I look forward to my noble friend producing some—that it has affected employment. Perhaps the Minister will tell the Committee whether it is true that in the past three years employment in those industries which are controlled or affected by wages councils has increased by 90,000, whereas employment in industries which are not affected by wages councils has decreased by nearly 1–5 million. If so, that seems to be a case for extending wages councils rather than abolishing them. Altogether, I believe that economically, politically, morally and socially the abolition of wages councils is a thoroughly retrograde proposal. I hope that it will be defeated.
Viscount Ullswater: Members of the Committee opposite have made their points strongly; but they have not been able to put forward any convincing case for the amendment moved by the noble Lord, Lord Eatwell. I believe that the amendment would do nothing to improve the Bill and I shall come to that in a moment, if I may.
Of course, there have been extensive consultations and debates on the future of wages councils. We issued consultation documents in 1985 and 1988. Following the 1988 consultation, we made it clear that the councils could have no permanent place in our system of wage setting. I have to say to my noble friend Lord Gilmour that that has been said on many occasions since that date, including before and after the last election.
In the 1988 consultation, on the five largest councils a clear majority of employers' bodies wanted the system abolished. Since then, there have been many requests for the abolition of the councils. They have not been confined to those who favoured abolition in the last round of consultation. The views of employers, the working of the legislation since 1986 and the needs of the 1990s all now point to abolition.
It is now clear beyond doubt that the wages councils are a barrier to employment. The system drags in the criminal law to prevent ordinary agreements between workers and employers which are mutually acceptable to both. Small businesses have to bear the brunt. If a small firm takes on a new, unskilled worker at a wage that it can afford and one which the employee finds acceptable, it can be a crime. There can be only one result—fewer extra staff for the business, lower expansion for the employer and fewer jobs for those seeking work.
The plain fact is that wages councils are no longer seen as providing a wage floor. They set going rates for

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large groups of employees, regardless of individual circumstances and setting a norm for percentage increases.
Research shows a clear link between higher pay and lower employment. Independent estimates of the job losses which would have resulted from only the first stage of Labour's minimum wage proposal ranged up to 500,000. Several wages council trades, particularly in the service industries—the hotel and catering and retail—are sectors with a high potential for employment growth. That I think is the answer to my noble friend Lord Gilmour who says that, indeed, employment has grown in those instances, not the fact that they have wages council set rates.
There is a large body of evidence, both in this country and abroad, that statutory wage fixing damages employment. This is, for example, a conclusion that has been reached by the OECD. In a recent report on France, it said:
"France's unemployment record compares unfavourably with that elsewhere … the problem is substantially more severe for youths, older workers and the unskilled … the national minimum wage seems in part to be responsible for this outcome".
Lord McCarthy: We have had that quotation several times in previous debates. The noble Viscount has in the past admitted that it is an unfair summary and not a direct quote.
Viscount Ullswater: No, in fact it is a direct quote from the OECD report.
Lord Eatwell: Does the noble Viscount agree that in the report the OECD said that the effect of the minimum wage in France on adult employment was nil? It was argued that there was an effect on youth employment. But we are not discussing youth employment. The report said the effect on adult employment was nil.
Viscount Ullswater: I believe that we are discussing youth employment.
Noble Lords: No!
Viscount Ullswater: Mention has been made of what happened in the Wages Act 1986 and the removal of youths from wages council provision. The noble Lord himself alluded to that point in his Second Reading speech.
It is wrong to believe that statutory minimum wages protect vulnerable groups such as women, ethnic minorities or young people. The opposite is true. Minimum wage fixing has an adverse effect on such people. In countries with comprehensive minimum wages such as France and Spain, there are high levels of youth, female and long-term unemployment. Those who are most vulnerable are those most likely to be excluded from employment if wage levels are set too high. In the UK the proportion of the unemployed who are women or young people is lower than in EC countries such as France and Spain.
What followed the reforms of the Wages Act 1986 can be seen in statistics for the period 1986–91. Full-time earnings for the under 21 year-olds grew in real terms in all the main council industries and occupations for both males and females. Also among
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the 16 to 20 year-olds, employment grew faster in wages council industries (9.6 per cent.) than in all industries. I do not believe what my noble friend Lord Gilmour said. He pointed to the opposite conclusion. I believe that those statistics prove the positive effect.
The freedom of employers to offer jobs at rates which would previously have been outlawed has enabled some to provide employment which would not otherwise have been available to people. Removing wages councils altogether will improve employment prospects for women and part-time workers and build job opportunities.
I have listened carefully to the points made by the noble Lord, Lord Eatwell. I must congratulate him on the ingenuity of his arguments. I must tell the Committee that the likely result of the amendment that he has put down would be unacceptable to the Government. Some of the wages council industries would be placed in a position of protracted uncertainty. Industry would not know whether particular councils were to be abolished or continued; or, if they had not been abolished, for how long they would continue to operate. Enforcement would become difficult or impossible. The amendment would mean that individual wages councils would remain in existence where one-third or more of the workers covered were paid below some figure above the statutory minima over a period of a year. The most likely result would be to hold up the abolition of all the councils by a year or more to determine that they met the criterion.
The only point of the amendment is to water down abolition of the councils. I do not believe that arrangements which the amendment purports to introduce are remotely practicable if the amendment were accepted, the resulting uncertainty would be damaging to industry.
The amendment is also illogical. If there is any point to the wages council system, it is to provide a wages floor. The system is ineffective and self-. defeating. Even if a wages floor were desirable, the amendments make little sense. Why does the desirability of a minimum rate depend on whether an arbitrary proportion of workers in a sector earn more than an arbitrary minimum? How does the proportion of workers earning more than an arbitrary amount make one council more or less necessary than another? The concept of the amendrnent is deeply flawed.
The amendment would give rise to anomalies. Different councils set different minima. An unwelcome effect of its adoption could be that some councils covering industries with relatively low wages could be abolished, while councils covering higher paid industries were maintained because they set higher minimum rates. There would be significant practical difficulties in determining whether or not individual councils fulfilled the criteria for abolition.
We estimate that two-thirds of wages council workers earn significantly more than the minimum rates. That is a conservative assessment originally based on surveys carried out by the wages inspectorate in 1983 and 1987. The surveys were designed to supplement the information provided by the

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inspectorate's routine monthly and annual statistics. The employers who contributed were those visited in the course of normal inspection checks.
The results make it possible to say with confidence that at least two-thirds of all wages councils workers earn more than the minima. But it would require a much larger and more sophisticated survey to determine whether that was the case for any individual council. Furthermore, such surveys reveal the position only at a spot date. The amendment calls for the criterion to be satisfied over a period of a year.
The purpose of Clause 31 is to abolish statutory wage fixing in wages councils industries. The amendment would serve only to delay abolition, and perhaps in a few industries perpetuate it for an extended period. The amendment does not improve the clause and I ask the Committee to reject it.
Lord Eatwell: I shall not take the time of the Committee to reply to those points in detail. I cannot believe that the partial and ineffectual reply given by the Minister would convince anybody. There was, however, one substantial point in his discussion; namely, his reference to the amount of information which was available on wages council rates of pay. His case against my amendment was that the Government did not have the information. Yet they have continuously asserted that wages councils should be abolished on the basis of information which he now admits he does not have. I think it appropriate to test the opinion of the Committee.
5.36 p.m.
On Question, Whether the said amendment (No. 221) shall be agreed to?
Their Lordships divided: Contents, 111; Not-Contents, 150.

Division No. 2

CONTENTS

Addington, L.

Geraint, L.

Alport, L.

Gilmour of Craigmillar, L.

Ardwick, L.

Gladwyn, L.

Ashley of Stoke, L.

Glenamara, L.

Aylestone, L.

Graham of Edmonton, L. [Teller.]

Beaumont of Whitley, L.

Birk, B.

Grey, E.

Blackstone, B.

Hampton, L.

Blease, L.

Hamwee, B.

Bonham-Carter, L.

Hanworth, V.

Boston of Faversham, L.

Harris of Greenwich, L.

Bottomley, L.

Healey, L.

Brimelow, L.

Henderson of Brompton, L.

Bruce of Donington, L.

Hilton of Eggardon, B.

Callaghan of Cardiff, L.

Hollick, L.

Carmichael of Kelvingrove, L.

Hollis of Heigham, B.

Carter, L.

Holme of Cheltenham, L.

Cledwyn of Penrhos, L.

Hooson, L.

David, B.

Howell, L. [Teller.]

Dean of Beswick, L.

Hughes, L.

Donaldson of Kingsbridge, L.

Hunter of Newington, L.

Donoughue, L.

Jay, L.

Dormand of Easington, L.

Jay of Paddington, B.

Eatwell, L.

Jeger, B.

Ewing of Kirkford, L.

Jenkins of Hillhead, L.

Ezra, L.

John-Mackie, L.

Falkender, B.

Judd, L.

Falkland, V.

Kilbracken, L.

Fisher of Rednal, B.

Kirkhill, L.

Gallacher, L.

Kirkwood, L.

Galpern, L.

Listowel, E.

766

Llewelyn-Davies of Hastoe, B.

Robson of Kiddington, B.

Lockwood, B.

Rochester, L.

Longford, E.

Rodgers of Quarry Bank, L.

Lovell-Davis, L.

Russell, E.

Macaulay of Bragar, L.

Seear, B.

McCarthy, L.

Sefton of Garston, L.

McGregor of Durris, L.

Serota, B.

Mackie of Benshie, L.

Shackleton, L.

McNair, L.

Soper, L.

Mallalieu, B.

Stoddart of Swindon, L.

Mayhew, L.

Strabolgi, L.

Merlyn-Rees, L.

Taylor of Blackburn, L.

Mishcon, L.

Taylor of Gryfe, L.

Molloy, L.

Thomson of Monifieth, L.

Morris of Castle Morris, L.

Tordoff, L.

Mulley, L.

Turner of Camden, B.

Murray of Epping Forest, L.

Varley, L.

Nicol, B.

Wallace of Coslany, L.

Ogmore, L.

Wedderburn of Charlton, L.

Peston, L.

Whaddon, L.

Pitt of Hampstead, L.

White, B.

Prys-Davies, L.

Williams of Elvel, L.

Rea, L.

Williams of Mostyn, L.

Redesdale, L.

Winchilsea and Nottingham, E.

Richard, L.

Wyatt of Weeford, L.

NOT-CONTENTS

Aberdare, L.

Elliott of Morpeth, L.

Aldington, L.

Elphinstone, L.

Allenby of Megiddo, V.

Faithfull, B.

Annan, L.

Ferrers, E.

Archer of Weston-Super-Mare, L.

Flather, B.

Fraser of Carmyllie, L.

Arran, E.

Gainsborough, E.

Astor, V.

Gisborough, L.

Astor of Hever, L.

Glenarthur, L.

Auckland, L.

Goold, L.

Belhaven and Stenton, L.

Goschen, V.

Beloff, L.

Gray of Contin, L.

Belstead, L.

Greenway, L.

Bessborough, E.

Gridley, L.

Biddulph, L.

Grimston of Westbury, L.

Blatch, B.

Halsbury, E.

Blyth, L.

Hardinge of Penshurst, L.

Boardman, L.

Harmsworth, L.

Bolton, L.

Harvington, L.

Borthwick, L.

Hayhoe, L.

Boyd-Carpenter, L.

Hemphill, L.

Brabazon of Tara, L.

Henley, L.

Braine of Wheatley, L.

Hesketh, L.

Broadbridge, L.

Hives, L.

Butterworth, L.

Holderness, L.

Buxton of Alsa, L.

HolmPatrick, L.

Cadman, L.

Hooper, B.

Caldecote, V.

Howe, E.

Campbell of Alloway, L.

Hylton-Foster, B.

Campbell of Croy, L.

Jenkin of Roding, L.

Carnarvon, E.

Johnston of Rockport, L.

Carnegy of Lour, B.

Kimball, L.

Carnock, L.

Kinnoull, E.

Chalker of Wallasey, B.

Kitchener, E.

Charteris of Amisfield, L.

Lauderdale, E.

Clark of Kempston, L.

Layton, L.

Colnbrook, L.

Lindsey and Abingdon, E.

Colwyn, L.

Long, V. [Teller.]

Constantine of Stanmore, L.

Lyell, L.

Cranborne, V.

McColl of Dulwich, L.

Crathorne, L.

Macleod of Borve, B.

Crickhowell, L.

Margadale, L.

Cumberlege, B.

Marlesford, L.

Davidson, V.

Marsh, L.

Denham, L.

Mersey, V.

Denton of Wakefield, B.

Montgomery of Alamein, V.

Derwent, L.

Morris, L.

Dilhorne, V.

Mottistone, L.

Dundonald, E.

Mowbray and Stourton, L.

Dunrossil, V.

Moyne, L.

Eccles, V.

Murton of Lindisfarne, L.

Ellenborough, L.

Nelson, E.

Elles, B.

Norfolk, D.

767

Norrie, L.

Stodart of Leaston, L.

Oppenheim-Barnes, B.

Strafford, E.

Orkney, E.

Strathcarron, L.

Oxfuird, V.

Strathclyde, L.

Park of Monmouth, B.

Strathcona and Mount Royal, L.

Pearson of Rannoch, L.

Peel, E.

Strathmore and Kinghorne, E. [Teller.]

Pender, L.

Peyton of Yeovil, L.

Sudeley, L.

Prentice, L.

Swansea, L.

Rankeillour, L.

Swinfen, L.

Rawlinson of Ewell, L.

Teviot, L.

Renton, L.

Teynham, L.

Rodger of Earlsferry, L.

Thomas of Gwydir, L.

St. Davids, V.

Thurlow, L.

St. John of Bletso, L.

Trumpington, B.

Saltoun of Abernethy, Ly.

Ullswater, V.

Seccombe, B.

Vaux of Harrowden, L.

Selborne, E.

Vivian, L.

Shannon, E.

Wakeham, L. [Lord Privy Seal.]

Sharples, B.

Skelmersdale, L.

Westbury, L.

Skidelsky, L.

Whitelaw, V.

Stockton, E.

Wynford, L.

Resolved in the negative, and amendment disagreed to accordingly.
5.45 p.m.
[Amendment NOS. 222 and 223 not moved.]
On Question, Whether Clause 31 shall stand part of the Bill?
Baroness Lockwood: I wish to oppose the Question whether Clause 31 shall stand part of the Bill. I listened with great interest to the previous debate. Much that was said bears closely on my opposition to Clause 31. I endorse much of what was said by my noble friend Lord Eatwell in his analysis, but my judgment of the situation is that the Bill would be far better without this clause. I reject what the Minister and other speakers said about wages councils being detrimental to women. I shall refer to that in due course.
First, I shall oppose this clause from an entirely different angle; namely, that of equal pay. Many Members of the Committee who are present, but not the two Ministers, will recall the protracted debates that we had in 1984 when we considered orders to amend the Equal Pay Act to provide for equal pay for work of equal value. The Committee may recall that that amendment was brought about because of infringement proceedings initiated by the EOC alleging that the Equal Pay Act did not comply with European legislation. The result was a judgment of the European Court of Justice.
As a consequence, the Government brought in what might be described as a byzantine set of processes and regulations which were largely criticised at the time in this Chamber as being unworkable and which have subsequently proved to be unworkable. That was why in 1990 the Equal Opportunities Commission put forward to the Government further proposals to tackle the problems of equal pay and to introduce a Bill providing for equal opportunities which combined the provisions of the Equal Pay Act and the Sex Discrimination Act. So far the Government have not acted on those recommendations from the Equal Opportunities Commission.
At the time when we amended the Equal Pay Act it was argued —indeed, it has been argued since 1970,
768
when the Equal Pay Act was first introduced—that wages councils were an integral part of the statutory means by which the principle of equal pay could be promoted in the United Kingdom. Indeed, wages councils are the only means of collective protection for women in sex segregated low paid work. I am sure that many Members of the Committee will be aware that one of the major problems in establishing equal pay is sex segregated work.
The alternative to the wages council is the expensive and protracted legal proceedings of cases being taken by individuals through the industrial tribunals, possibly right through the legal process to the European Court in Luxembourg. One example of that is the recently published judgment of the EAT appeal against an award by an industrial tribunal. 'That involved the Coal Board. It is a case which had been running for over seven years and is probably not yet settled. Although the EAT made a judgment, the case may go further.
Is it the Government's wish and intention that that kind of situation should continue through individual cases being taken to tribunals? Or are they looking at the possibility of some overall means of dealing with the problem of unequal pay? Also, have they consulted the European Commission on the moves being taken to abolish the wages councils? Could the abolition of the wages councils lead to further proceedings against the UK on the grounds of infringement of the European Community's equal pay legislation? Those are extremely important questions which are related to the whole of Clause 31. I should like the Government to answer them specifically.
Further, perhaps I may say that, despite what the Minister said, the evidence that I have seen suggests that throughout the 1980s the wages councils have been a factor in reducing the wages gap between men and women. New research by PEP shows that the wages councils have performed a positive and unrecognised role in eliminating discrimination in pay between the sexes, particularly over the past 10 years.
In its report, Narrowing the Gender Pay-Gap—how wages councils work for women—PEP reveals that among manual workers women in the wages council sectors earned 81.3 per cent. of male manual workers' hourly earnings as compared with 71.5 per cent. across all industries. I do not suggest that the wages paid under the wages councils are by any means adequate. I do not believe that low wages are the answer to the UK's economic problems. In fact, I believe that the contrary is true; that is, that we need a highly-waged, highly-skilled technical workforce if we are to overcome our problems. But at the moment the position is as it is. I ask the Government to look carefully at the implications for them if they abolish the wages councils on grounds of equal pay. Furthermore, in doing that, I ask them to look, as an alternative to the wages councils, to the implementation of the recommendations by the Equal Opportunities Commission.
Lord Shackleton: I am surprised that we should be debating this subject at all. If ever there was an item that was well understood in industry it is the system of wages councils. I was a director of two companies in

769
charge of personnel. Those companies employed thousands of people. We never had any problem with wages councils except that, if we found ourselves having to pay more to meet the requirements, it was an indication that we were not paying enough.
I should be sorry if the provision were removed from the statute book. It is a satisfactory system. I spoke to colleagues today—one was from a large department store group and the other from the biggest mining group in the world. In neither case have they had trouble. I hope that we shall take a little time and not throw out the provision.
Lord Rochester: For my part I do not believe that there is conclusive evidence one way or the other as to whether removal of young people from the scope of wages councils in 1986 had the effect of increasing or decreasing employment in the trades affected. The fact that it has been possible to compile so much evidence on both sides of the argument is indicative of its inconclusive outcome.
The noble Viscount, Lord Ullswater, in replying to an earlier debate, said that it was clear beyond doubt that wages councils acted as a barrier to employment. He quoted some evidence from the OECD to that effect. But equally, other evidence to the contrary has been adduced. For what it is worth, my view is supported by the Institute of Personnel Management, which, in a survey, found that the 1986 legislation led to no significant changes in employment levels.
However, some facts stand out clearly. First, as the noble Lord, Lord Gilmour, said, the Committee is right to be highly sceptical about a decision to abolish wages councils which is based on consultation of five years ago when last year there was a general election at which the proposal could well have been included in the Conservative manifesto but was not.
Secondly, in that abolition has the effect of reducing pay or, just as bad, acting as a disincentive for people to take jobs in sectors now covered by the councils, that is bound to increase the number of claims for family credit from those with children, who are most affected by poverty. I agree with those who feel that the social security system should not be used to subsidise low wages paid by unscrupulous employers. It is regrettable that the Government do not seem to have made any assessment of the cost to taxpayers of the resulting increase in eligibility for benefit.
In contrast to a national minimum wage, to which I and my party are opposed and which would be determined from the centre by statute, the minimum wages set by wages councils are negotiated between employers, employees and independent people in the relevant trades. The system also allows for a targeted industry-by-industry approach rather than the inflexible across-the-board approach that a national minimum wage would involve.
Of course it would be better if wages councils allowed for regional as well as sectoral flexibility. But that and other imperfections in the system are arguments not for abolition but for reform. As I said at Second Reading, most desirable would be an integration of a tax and benefit system under which
770
benefits could be directed not to those on low pay, but to ensure that people—especially those with families —enjoy a decent minimum income.
It is claimed that minimum wages council rates have the effect of pushing up the pay of people who earn more. In my view, that is a legitimate criticism of a national minimum wage, which, because of its effect on differentials, would have damaging consequences for productivity and competition. But it is ridiculous to suppose that a small increase in the rate set by a wages council has the effect of pushing up pay throughout the whole salary range in the affected sector. In the end I believe that our economic and social problems will have to be solved by establishing common ground on which political parties can stand together. Otherwise they may not be solved at all.
Judged by that yardstick, the abolition of wages councils is a retrograde step from which even now the Government would be wise to hold back.
Lord Campbell of Alloway: Having listened to the arguments, on balance I nonetheless adhere to the view that I would not wish to abolish wages councils. Whatever way it is put, it is not right to have a minimum wage. But it is right that there should be flexible pay structures which give incentives to individual performers.
I have already given my broad reasons. Other reasons are contained in a document that appears to have reached the noble Lord, Lord Eatwell. I refer to a Department of Employment note of February 1993. I shall not weary your Lordships with any further reasons. But I wish to deal with the interesting problem of unequal pay and the suggestion that in some way it is related to the retention of the wages councils. With the greatest respect to the noble Baroness I do not believe that it is so related (though I may be wrong), because it seems to me to be a wholly disparate problem. If something needs to be done it ought to be resolved on its merits, not in a Bill such as this relating to the retention or abolition of wages councils but in some other enactment. If there is a problem with industrial tribunal decisions, the European Court of Justice and so on, whether one retains or abolishes the wages councils there will be some aspects of the problem that are bound to override the situation.
I suggest that that should be treated as a separate item and does not afford an argument for the retention of the wages councils. For those and other reasons that I will not mention I support the Motion, That Clause 31 stand part of the Bill.
6 p.m.
Lord McCarthy: Having tried on this side of the Chamber to persuade the Committee to go along with our ingenious arguments, we have failed. It is right that we should have this debate on the clause as it stands. Many arguments can be made for and against it. What is remarkable is that the arguments that have been made for the clause have been so slight and narrow. It can be argued in favour of wages councils —indeed, it has been argued most recently by the noble Baroness who moved that the clause stand part

771
—that they have done a considerable amount for the cause of equal pay and the elimination and mitigation of sex discrimination in pay. No answer was forthcoming from the Government on that ground, though one hopes one may hear one in due course.
Another point that can be made, and has been made on this side of the Chamber—I must say that the noble Lord, Lord Skidelsky, does not understand it —is that the argument for wages councils is sometimes said to be put on the basis of low pay. That is a negative way of putting it. It is put on the basis of a living wage, which is not the same as poverty, that is to say, that there shall be a level of pay below which people shall not sink. If the Government got their way and their plans came to fruition, and it was the case that the wages councils were holding up rates to the full extent of the difference between wages council rates and non-wages council rates (because wages councils, stretching across the whole economy, are far from comprehensive), there would be a cut from about £3 per hour, which would be the average wages council rate, to about £2 per hour, which would be the rate for similar unskilled work outside the wages council area. We would say that a cut of that size was too much and it was wrong for a civilised country to allow such wages, which were not living wages, to be paid. That argument has not been met or even debated by the Government but it is an argument about living wages and low pay, not about poverty.
The Government have based their argument—in so far as they have argued—on the effects on unemployment. That is one small part of the economic case. They have said that if we abolish wages councils we shall arrest the rise in unemployment. That is the worst argument because it is the most inconclusive of all the arguments. One can look at this matter in two ways. Either one has simulations or one does field work. If one does simulations, whatever equations are put in the desired answer falls out at the bottom. One can set it up to show that there is or is not an employment effect. Simulation will produce the answer. If one goes out and asks people or looks at what has happened, for example where wages councils have been abolished—and quite a few have been abolished—or one looks at what has happened in those cases where wages council coverage has been abolished for certain groups, such as young people, one finds that the factors that affect the level of employment (which are very complicated), overwhelmingly dominate any effect that may arise from mucking about with wages councils or minimum rates. That is what field work shows. The whole thing is totally inconclusive. If the Government want to stand upon that in the middle of a recession they have a very weak argument.
One has to ask oneself what is the real argument. I put it to the Minister—and he can disallow it or set it aside if he does not like it—that I believe the Government have been led down this route by its ideology. For a very long time the Government have believed that the labour market ought to work and would work if only trade unions could be got out of the way. In effect they have had trade unions out of the way for 10 years. The labour market ought to be
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working but it is as bad as ever. The relationship between productivity and wages and unit labour costs is as bad as ever, certainly if one looks at international comparisons. That should not happen if the Government's theory of economics was correct. Now that one has got trade unions out of the way one ought to have much more flexibility in wage rates and falls in money wages at the level of unemployment that one has.
The Government have to advance some other explanation. The only explanation they can find is the statutory regulation of the labour market. This is the thinnest of all the arguments. The main reason why wages continue to rise is not that they are being pushed up by trade unions but that they are being pulled up by management. The first principle of management in the 1990s seems to be that the first charge on the firm must be the maintenance and improvement of the real wages of managers. That is why we have tremendous differences in differentials. The lowest decile goes up by 4 per cent. and the highest decile goes up by 47 per cent. in real terms, because the first principle is that managers have to look after their own real incomes and they are not mean enough to stop some of it dropping down to workers further down. To have more regulation of trade unions and to abolish wages councils will do nothing whatever to tackle that problem. But the Government are in the grip of ideology and one cannot talk sense to ideology.
Lord Skidelsky: I should like to open up a more general issue about the relationship between wages councils and employment. First, however, I should like to take up a point raised by the noble Lord, Lord McCarthy. He said that a level of pay below which no one should sink should be the goal of any civilised society. Had he said "a level of income below which no one should sink", I would have endorsed that proposition completely. The noble Lord has not completely understood the distinction between a living wage and a living income. That was the whole point of the argument that one should deal with poverty through the tax system and not the wages system.
The noble Lord was good enough to say at Second Reading that I was deviating from the teachings of my biographical subject, John Maynard Keynes. I should like to quote what Keynes said on this matter in his evidence before the Macmillan Committee in 1930:
"If on the ground of humanity or justice you want to give the poorer part of the community £100 million more income you would be wiser to do that out of taxation than by fixing the wages of individuals at a higher figure than it pays their employers to give them".
That is the proposition on which I take my stand in this debate.
Let us come to the evidence. First, I do riot pay very much attention to the empirical results because, as has been said, they are inconclusive. One has to start with an intuition. It is one of the most powerful intuitions in economics. The noble Lord, Lord Eatwell, may say that it is lesson one and that I have never got on to lesson two but it is a very powerful intuition and one that instinctively strikes laymen as being acceptable. It is that if the costs of doing business are lowered, more business will be done, other things being equal. Of

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course, that applies to all costs. It applies to the hassle costs of doing business, which is of great importance to small firms, particularly when they are faced with bureaucratic costs which are an enormous tax on labour. That is one very good argument in itself for getting rid of the wages council machinery for small firms. But wage costs are a key element in costs. Again, the intuition is that if wage costs are lowered, more labour, other things being equal, will be demanded. There are circumstances in which that is not true—one can think of circumstances in which it is not true—but as an intuition, that seems to take us a very long way.
My second intuition is that the market covered by wages councils is a competitive market, or it is a more competitive market than many other markets in the economy. So one would expect what follows from there being a large number of buyers of labour. If one accepts that as a basic institutional datum, one would intuitively expect wages to be set by competitive conditions and not fixed below the value of the marginal product of the workers concerned.
The noble Lord, Lord Rochester, talked about unscrupulous employers. There seems to be a general feeling that employers who pay low wages are unscrupulous. I do not accept that. Suppose we agree, for the sake of argument, that all employers are unscrupulous, the conditions under which they can exercise their lack of scruple—their lack of scruple can affect wages—is fixed by the institutions of the market. My contention is that this market is more of a competitive market than otherwise.
6.15 p.m.
Lord McCarthy: I do not think people would generally say that employers who pay very low wages are unscrupulous. What we are saying is that they are inefficient. We are saying that those who find that they cannot pay more than £2 an hour are the most inefficient of all the people in the labour market. If they go out of business, more efficient people take their place.
Lord Skidelsky: That is an assertion.
Lord McCarthy: That is intuition.
Lord Skidelsky: It may be that the labour is not very efficient. In many cases we are talking about the lower end of the skills range. It may be that labour in this market is not very efficient and that workers are paid low wages which represent the value of their product to the employer. That may be true irrespective of the motives of employers. If one is in a competitive market one cannot consistently undercut the going wage for that market.
There has been no real attempt in any of the evidence that has been produced to quantify the degree of imperfection in the labour market. I refer to the study by Machin and Manning, which was mentioned by the noble Lord, Lord Eatwell, during the previous debate. They claim that this is a monopsonic market and that it approximates more to a case where there is a single buyer of labour.
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However, they have not attempted to quantify the degree of imperfection in that market. They have given a test. They say that the increase in wage dispersal that the authors found to be a consequence of the softening of minimum wage requirements in the 1980s suggests that this is an imperfect market. It is not, I suggest, a good test of competitiveness in that market but may simply reflect variability in local conditions exposed by the declining bite of the wage council rates over this period. We are in the realm of assertions and intuitions here.
If we come to the empirical evidence, studies of the link between pay and employment at national levels tend to show that increases in pay caused by statutory wages are likely to decrease employment. Many studies show this. One can refer to the study by Gregg and to a study by Kaufmann in the Economic Journal of 1989 which showed a weak negative relation between pay and employment. There are studies from the United States. There are also the remarks of the OECD which have already been quoted. The study by Machin and Manning, which is the key study of the effect of wages councils in this country, states that this negative correlation between wages and employment is not present or cannot be found in wage council industries. But there are weaknesses in that study. In particular, they do not estimate the effect of changes in the statutory minimum rates on part-time workers.
Lord Eatwell: The noble Lord should be aware that because the new earnings survey does not adequately cover part-time workers no serious studies of the effects of minimum wages cover part-time workers. The data simply are not available.
Lord Skidelsky: That simply confirms the point I have just made. The data do not cover the effects on part-time workers. The effects on part-time workers are extremely relevant in this context because at least half of wages council workers are part-time workers, largely female.
My main criticism of surveys of this kind—this is why surveys of this kind will never give you the answers that you want—is that the study is a very good—
Noble Lords: Oh!
Lord Skidelsky: Surveys of this kind will not give you the answers that you want and they will not give me the answers that I want either. The study is a very good example of econometric bamboozling. One does not get in that study any of the raw data on which the correlation coefficients are based and one does not get in that study any clear statement of ceteris paribus conditions—other things that need to be the same for these results to hold. This is an important matter when one is covering the effects of changes on a small number of industries. The economic evidence is inconclusive. I accept that. The effects of minimum wages may be different in different places at different times. Therefore, it is very good to rely on one's basic intuitions in this matter. That seems to be the only rational way of proceeding. One's basic intuition—
Noble Lords: Oh!
Lord Skidelsky: If Members of the Committee opposite have some different concept of rationality in this case I should be very happy to hear it. But all they have cited as evidence is studies which do not back up their position.
Baroness Seear: I am going to be extremely rude. In all humility, we have to reach Amendment No. 279. I implore my colleagues that we do not descend into the senior common room which many of us have suffered for far too many years. Perhaps we can just avoid the senior common room. That would be a very great help.
Lord Skidelsky: I am responding to the very senior common room remarks made by the noble Lord, Lord Eatwell. They deserve a reply. That is how the argument should be conducted on this issue which has many technical features. I have gone through that part of the argument.
I want to return to the basic statement on which I rest my case for supporting the Government. That is that the alleviation of poverty and the achievement of a basic income should be the task of the taxation and political systems and not that of wage fixing. That has no place in the task of alleviating poverty. We hope for a situation in which wages will increase steadily with the rise in the efficiency of industry. But actually to intervene in bargains between employers and employees is to distort the market; to get the market to send out wrong signals; to allocate labour inefficiently; to slow down the aggregate growth of employment; and in the end not to have the desired effect of alleviating poverty anyway. For those reasons I support Clause 31.
Earl Russell: I hope that my noble friend Lady Seear will allow me 30 seconds in the senior common room. We have here the undistorted market existing somewhere outside Plato's cave. There is only one undistorted market which I have ever heard of in the whole world. That was the foreign currency market in Kiev which opened shortly after Black Wednesday and where in a whole day not a single transaction took place. That is the undistorted market.
I intended to reply rationally and not intuitively to the Minister. He had one single argument in answering the amendment of the noble Lord, Lord Eatwell. He said that the abolition of wages councils would create jobs. He gave us very little reason to believe that. But for the sake of argument I concede that. If it creates jobs, can the Minister say at what cost?
I understand what the noble Lord, Lord Skidelsky, said about the difference between a living wage and a living income. But the lower wages go the higher the proportion of the living income which has to come from the state. In fact, if wages go below what is regarded by the social security benefits system as subsistence level—which God knows is low enough —the proportion of the cost which falls on the state must go up. I agree with the noble Lord, Lord Gilmour of Craigniillar, whose speech I listened to with great pleasure. But I do not see why the taxpayer should subsidise the bad employer.
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But the cost to the state is not only a matter of increased benefits; it is also a matter of lost revenue. This Government are a very long way from realising how much of their present difficulties in the public sector borrowing requirement are the result of falling tax revenues because of diminishing economic activity.
The noble Earl, Lord Caithness, in a Written Answer of 25th March, gave me a Treasury estimate of the effect on income tax and national insurance yields if average earnings should fall by 1 per cent. It involves the loss of £1.14 billion. That figure leaves out VAT. I did not ask the Treasury about that because I thought it might cause them some interpretative difficulty.
The effect on benefit is perhaps even greater. If one considers a man with four children paying a rent of £50 a week, earning £135, and one assumes that his income decreases to £110—which would be the likely effect of this clause—that would cost the state £851 extra benefits in a year and £388 in lost tax. That is over £1,000 lost to the Exchequer from one person.
Right-wing governments around the world have had very considerable trouble with public sector deficits. That does not only apply in this country, but in the United States and Australia. We constantly hear noble Lords opposite talking, as the noble Lord, Lord Skidelsky, has done, about the need to keep down wages. I do not believe that they understand what a rod they are pickling for their own backs in terms of the public sector borrowing requirement that they are building up. Before doing that, they should stop and think about the drag created by the public sector borrowing requirement which grows too high on employment throughout the rest of the economy. They are cutting off their noses to spite their faces.
They should wonder about their own concept of the bogus job. If I want to spend money, as Chancellor of the Exchequer, repairing holes in a school roof, that is not a bogus job. I am paying for a service that I want rendered. But if a job is incapable of being sustained at a living wage, that is not an economic job. The noble Lord, Lord Boyd-Carpenter, most unexpectedly, is casting himself in the part of the heir of Louis Blanc. There is an even wider question here which is whether, in the long term, Marx or Keynes was right about the development of the capitalist system. My gorge rises at the thought of conceding that Marx might have been right about anything.
Marx thought—and this Government have been arguing with him for so long that they are getting like a crusty married couple who are becoming like each other because they have quarrelled so long—that continual competition would continue to force down wages until it led to the collapse of capitalism. In 1929 many people found that picture convincing; in 1949 there were many fewer. That lesson has been forgotten.
I know that we live in a global economy, but I do not believe that we shall do very well setting out to compete with Taiwan. It is a competition which we are likely to lose. If, globally, wages continue to be forced down by competition, there is not going to be anyone left to buy anything. If we try to sustain our jobs by a

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Speenhamland system of subsidising uneconomic wages, the bill left to be picked up will be very big indeed.
Lord Blease: The question of wages councils occurs in the penultimate clause of the Bill and it deals specifically with Northern Ireland. I do not want to touch on that at this stage but with the principle. Can the Minister say why we have the summary way in which the Government have decided to abolish en bloc the wages council system? Is it not the denial of the right of workers in low-paid industries, which has existed since 1909, to rely on fairness to be brought to bear on working conditions and wages? Can the Minister say why the machinery within the wages council legislation for constructive procedures and the establishment of recognised collective bargaining arrangements is not pursued? What studies have been undertaken by the Government to assess the consequences of social deprivation which will result from the sudden en bloc abolition of the wages councils?
6.30 p.m.
Baroness Gardner of Parkes: I should like to speak in favour of retaining the wages councils because the points raised by the noble Baroness, Lady Lockwood, are very valid. It is women who will be the most adversely affected if the wages councils are abolished. As I understand it, the wages councils now do a much smaller job than they used to—and I think that that change is for the better. However, at their current level it is important that they should be retained.
In both this clause stand part debate and in our discussion on the previous amendment, I heard statements that there are better ways of dealing with low-income families. That is a fallacy. As has been said, giving people state benefits so that they might subsist is something that we do, but it is not the ideal. People like to have the dignity of earning their own way through life. That applies particularly to women who work long hours, often part-time, in very low paid employment. Women do that because they want to make a contribution to their family's income and I think that we should encourage them to continue doing that.
It should always be worth working. Too many people today would like to work but do not have that opportunity. We should ensure that those who are willing and able to find work continue to have the opportunity of taking up work. I consider myself to be a strong Conservative and I believe that there should never be an incentive for people simply to sit back and to claim from the state.
I have heard many comments about wages and a "Taiwan economy"; but, as is the case with rents, I do not think that the movement of wages should always be upwards only. We could go seriously wrong if we believed that everything should always go up. However, when we lose our currency value, we lose again because we suddenly find that all imported goods are costing a lot more, and that means people's wages do not buy what they once did.
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We live in a competitive world and the real answer is productivity. We are more likely to get high productivity from people who feel that they are receiving a fair wage for the job and not a pittance without any protection at all. I have been surprised in industrial tribunals at the number of employees who have lost their jobs who would happily have taken another job with lower pay rather than be unemployed. No one wants to be unemployed.
Wages councils protect the people who are right at the very bottom of the income scale. My noble friend Lord Skidelsky mentioned a powerful intuition. I believe that there is no intuition as powerful as women's intuition. My intuition is that we should not become too involved with the theory on this, and with discussions on studies and yet more studies. By the time that I had listened to a convoluted argument about Machin and Manning being the definitive study and then to the noble Lord saying that there were faults in that study (because he did not agree with it), and then to him saying that it was all bamboozling, I was getting more and more bamboozled myself. I hate to vote against the Government; but with my woman's intuition, I feel that this is one issue on which I must do so because I must support the retention of the wages councils.
Lord Stoddart of Swindon: I should like to make a couple of short points. First, it must not be thought that employers en bloc are in favour of this legislation. Many good employers deplore what the Government are doing. Indeed, many good employers are fearful about the results of this legislation because they say that many bad employers will cut their wages and that if they are to be competitive they will then have to follow suit although they want to retain wages at at least wages council levels. So, let it not be thought that all employers are in favour of this legislation.
The other strange phenomenon that we have heard in this debate is that the Conservative Party—not the Labour Party, not the Liberal Party and not the Communist Party—is saying that wages should be subsidised. There is something for us. There is a turn-up for the book. The Conservative Party is saying that we should subsidise wages. Yesterday in the House of Commons the Secretary of State for Trade and Industry said that we should not subsidise wages, yet today we hear from the noble Lord, Lord Skidelsky, from his common room and from the noble Lord, Lord Campbell of Alloway, from his Chambers that that is the way to settle wages—that we should subsidise them. In other words, we should subsidise bad or inefficient employers. Frankly, it is nonsense. Have not they heard of Mr. Peter Lilley, the Secretary of State for Social Security, who is embarking upon an exercise to reduce his department's £80 billion budget? He is not looking for any increases through wages subsidies or income support; he is looking for cuts, and he is looking for cuts because the Government are heading for a £50 billion public sector borrowing requirement deficit. How is it, then, that here today we have the Conservative Party—I must emphasise again that we are talking about the Conservative Party—advocating subsidising wages at the same time as the other part of the Conservative Government are saying

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that we must cut the PSBR and limit or even cut the social security budget? Perhaps the Minister will please explain it to me because I have no intuition about this. I need to have this paradox explained to me as I am sure do all other noble Lords. I say again to the Minister, "Please let us have the explanation".
Lord Eatwell: I promise to obey the stricture of the noble Baroness, Lady Seear, and not become involved in common room arguments other than to say that I think it is the intuition of many that the earth is flat, and the noble Lord, Lord Skidelsky, displayed flat-earth economics with considerable skill in his speech.
I support the remarks made by the noble Earl, Lord Russell, the noble Baroness, Lady Gardner of Parkes, and my noble friend Lord Stoddart of Swindon. The issue which the noble Viscount has not faced, which he has continuously refused to answer, is: what is the estimated cost to the Exchequer of this measure? Why should we be using the family credit system, as suggested in the 1988 consultation document, to subsidise employment? The Minister must answer those questions because this is the economic argument as opposed to the social argument; it is the core argument of economic efficiency against the clause.
Viscount Ullswater: We have had another long debate, and I should like to answer as many of the points that have been raised as possible. Perhaps I may start with the noble Baroness, Lady Lockwood. It is important to say that the abolition of the wages councils has nothing whatever to do with sex discrimination. None of the fundamental planks of the United Kingdom's comprehensive framework of sex discrimination legislation is at all altered by the councils' demise. Any woman working for an employer in a wages council trade who believes that a man in the same employment doing like work or work of equal value is being paid more can bring an equal pay complaint to an industrial tribunal. That is the position now and it will still be the position when the councils are abolished.
I must advise the noble Lord, Lord McCarthy, and my noble friend Lady Gardner of Parkes that the abolition of the wages councils will have no effect whatever on women's existing rights to bring claims for equal pay.
Baroness Seear: I am sorry for interrupting the Minister, but if the overwhelming number of workers in wages council industries are women, as is undoubtedly the case, is there not at least an argument that there will be indirect discrimination if we abolish wages council rates?
Viscount Ullswater: No, I do not agree with that argument. The fundamental fact that noble Lords opposite are peddling is that wages will go down immediately. The noble Lord, Lord Eatwell, is keen to demonstrate that wages will go down.
Lord McCarthy: Is the Minister telling us now, at 20 minutes to seven, that the Government will have all these positive employment effects without wages going down?
Viscount Ullswater: No. It is important that wages should find their own level. It is the Equal Pay Act not wages councils which will assist women. Wages councils are much more about minimum pay, not equal pay. The Equal Opportunities Commission has taken legal advice which suggests that the Government are in continuing breach of the principles of equal pay for men and women, and that the abolition of wages councils will result in further breaches of Article 119 of the Treaty of Rome and the equal pay directive. We shall study the opinion forwarded by the EOC. However, we have previously examined the proposals for any possible effects they may have on equal pay and came to the clear conclusion that abolition of the wages councils will not breach the equal treatment directive or the equal pay directive.
The Equal Pay Act 1970 and the Sex Discrimination Act 1975 mean that the UK complies fully with its obligations under European Community law. Our legislation will remain entirely consistent with Community laws after the councils have been abolished.
Baroness Turner of Camden: Is it not a fact that the gap between male and female rates is much narrower in wages council industries than in industry generally?
Viscount Ullswater: What is important is work of equal value. If there is a difference between the two, a woman can take the case to the industrial tribunal. I shall reply briefly to the noble Lord, Lord Blease. Consultation took place in Northern Ireland at the same time as it took place in this country. I do not believe that further consultation is necessary'. Interested parties in Northern Ireland, just as in Great Britain, have had the opportunity to express their views before the councils are abolished, as the wages order provides.
Perhaps the most obvious point is that employees in wages council industries are not all, or mainly, low paid. Each council covers almost the entire labour force of a particular industry, not just employees at the bottom of the pay scale. Large retail shops are not staffed entirely by shelf fillers. They also have check-out operators, supervisors, office staff, departmental managers and store managers. Workers in wages council industries are spread across the whole pay distribution. We know that more than two-thirds of them are paid significantly above the statutory minimum rates.
The term "poverty pay" represents an even greater distortion. Low pay and poverty are not synonymous. It is easy to jump to the conclusion that those on relatively low rates of pay will be poor. Nothing is further from the truth. The majority of lower paid workers, and indeed about half of all workers in wages council industries, work part-time. Young and part-time workers are usually not the sole source of income for their families. Frequently, they are second or even third earners in their households.
The plain fact is that lower paid workers live in households which are spread over the whole income distribution; about half of them in the top half of the distribution. That is a figure with which the noble

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Lord, Lord Eatwell, will agree. Almost as many low-paid workers are in the richest fifth of households as in the poorest fifth.
Opposition attacks are based on the assumption that the abolition of the councils will be the prelude to significant and widespread reductions in wages.
Lord Stoddart of Swindon: I am trying to follow what the Minister is saying. Is he suggesting that because people in wages council industries, who may be low paid, may be part of a two-income family, they should not expect a reasonable wage? Is he now saying that as well as the state subsidising bad employers, husbands and wives should subsidise bad employers because they happen to be making a larger contribution to the household? It is nonsense.
Viscount Ullswater: No, I was saying that the lower-paid workers live in households which are spread over the whole income distribution. That is what the evidence indicates.
Baroness Nicol: What evidence?
Viscount Ullswater: Over time a somewhat different pattern of pay might well emerge. Most employees will probably detect no immediate change in their pay though some new entrants may receive lower starting rates.
The best indication of the implications of the abolition for overall pay rates is from previous abolition of wages councils and removals from wages councils control. The previous Labour government abolished 11 councils covering some 600,000 workers. There is no evidence of a reduction in average earnings as a result. The 1986 Wages Act took young people aged under 21 out of wages council regulation entirely, since which time their gross wages have continued to grow.
I know that noble Lords opposite have persuaded themselves that the price of labour can be increased artificially without reducing demand, but the plain fact is that basic economic laws apply. I listened carefully to my noble friend Lord Skidelsky. I enjoyed the lesson in economics that he gave the Committee. I agree with his interpretation of economic law rather than that of noble Lords opposite, including that of the noble Earl, Lord Russell, who demonstrated with his own figures that it is better and cheaper for the Treasury for someone to remain in work rather than to become unemployed. If the price of labour is raised by statute, the number of jobs goes down. But that does not mean that it is possible to make reliable numerical estimates. A great many factors influence the level of employment and wages in the labour market. It is idle to pretend that there is a magic formula which will isolate one single factor.
Noble Lords opposite and the Labour Party in another place have had every opportunity to say that they would reintroduce wages councils, and they have failed to do so. Labour Party policy is to introduce a national legal minimum wage starting at half men's median earnings and rising to two-thirds of the male median hourly rate. The national minimum would thus be somewhat higher than the minimum rates set
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by the wages councils. Various bodies have estimated the likely effects on employment and estimates have ranged from 25,000 jobs lost to well over a million, with up to 2 million jobs which could be lost if the pay differentials of higher paid workers were restored fully. However, for wages councils, which set lower minimum, which cover only a limited number of industries, and which will therefore have a smaller impact on employment, the plain fact is that there is no reliable way of estimating the extent of the employment effect.
The noble Lord, Lord McCarthy, misled the Committee. He said that productivity has not increased, whereas in fact it has increased considerably this year. He said that unit wage costs are not comparable with those of our major competitors. In fact, they are rising much more slowly now than those of our major competitors.
Lord McCarthy: What I said, as Hansard will show, is that if one takes the decade as a whole, unit labour costs in this country are not competitive with unit labour costs in Europe.
Viscount Ullswater: The councils were introduced to counteract poor conditions and wages in the Edwardian era. They attempted to tackle poverty in an age before the safety net of social security benefits and before comprehensive health and safety measures. The councils have now been in decline for many years. From a peak of 66 councils in 1953 their number has fallen so that now there are only 24 which are still active. Their coverage and operation is shot through with difficulties and anomalies. The wages council system has been perpetuated for too long. It is time to end it.
Baroness Turner of Camden: Before the Minister sits down, he mentioned 1953. Does he agree that there was a high level of employment at that time, and that the high number of wages councils seemed to have no effect on that?
Viscount Ullswater: I believe that trying to draw the conclusion that the retention of wages councils means high employment is taking things a little far.
Lord Eatwell: Before the Minister sits down, will he address the question which should be associated with any measure which a responsible government advances; that is, of the Exchequer cost of the measure, which he has persistently refused to give? Members of the Committee will know that the Exchequer cost of the wages councils system as presented in the consultation document was £2.5 million—just £2.5 million. It is my estimate that the Exchequer cost of the abolition of wages councils in a full year will be £400 million. Does the Minister agree with my estimate?
Viscount Ullswater: If the noble Lord reads my words carefully in Hansard he will see that I have addressed that problem.
Baroness Lockwood: Before the Minister sits down I wish to point out that I asked two specific questions which he has not addressed. First, I asked whether he

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was satisfied that there should be a procession of individual cases, such as the 700 involved in the British Coal case before the EAT to which I referred, rather than a collective mechanism such as wages councils. The Minister did not reply specifically but he did say that the Equal Pay Act was the remedy that women had. I do not know what deductions I must draw from that. Secondly, I asked whether the Government have consulted the European Commission. The Minister's response was to say that he had had a legal opinion from the Equal Opportunities Commission. If that is so, and if that opinion indicates that the wages councils could be an infringement of Article 119 and the directives, how can he be so sure that the abolition of the wages councils does not affect equal pay?
Viscount Ullswater: I am sorry that I did not address myself to two of the questions which the noble Baroness put. She mentioned a case concerning employees of British Coal, which involves complex points of law. Inevitably, there would be a great number of appeals and, indeed, counter appeals. It may be that the numbers are 700, as she suggested, but I am not aware of that. However, complex points of law are involved. I tried to demonstrate that the Government are convinced that the action which they are now taking does not breach any European statute.
6.53 p.m.
On Question, Whether Clause 31 shall stand part of the Bill?
Their Lordships divided: Contents, 112; Not-Contents, 85.

Division No. 3

CONTENTS

Aberdare, L.

Ferrers, E.

Alexander of Weedon, L.

Flather, B.

Allenby of Megiddo, V.

Fraser of Carmyllie, L.

Archer of Weston-Super-Mare, L.

Gisborough, L.

Goold, L.

Arran, E.

Goschen, V.

Astor, V.

Gray of Contin, L.

Astor of Hever, L.

Greenway, L.

Beloff, L.

Gridley, L.

Belstead, L.

Grimston of Westbury, L.

Blatch, B.

Halsbury, E.

Blyth, L.

Harmar-Nicholls, L.

Borthwick, L.

Harmsworth, L.

Boyd-Carpenter, L.

Harvington, L.

Brabazon of Tara, L.

Hayhoe, L.

Braine of Wheatley, L.

Hemphill, L.

Brookeborough, V.

Henley, L.

Butterworth, L.

Hesketh, L. [Teller.]

Cadman, L.

Hives, L.

Caldecote, V.

Holderness, L.

Campbell of Alloway, L.

HolmPatrick, L.

Carnegy of Lour, B.

Hooper, B.

Carnock, L.

Howe, E.

Chalker of Wallasey, B.

Hylton-Foster, B.

Clark of Kempston, L.

Jenkin of Roding, L.

Colwyn, L.

Johnston of Rockport, L.

Craigavon, V.

Kilmarnock, L.

Cranborne, V.

Kitchener, E.

Crickhowell, L.

Lauderdale, E.

Cumberlege, B.

Leigh, L.

Davidson, V.

Lindsey and Abingdon, E.

Denton of Wakefield, B.

Long, V.

Dundonald, E.

Lyell, L.

Elks, B.

McColl of Dulwich, L.

Elphinstone, L.

Macleod of Borve, B.

Elton, L.

Marlesford, L.

Faithfull, B.

Marsh, L.

784

Merrivale, L.

Saltoun of Abernethy, Ly.

Mersey, V.

Seccombe, B.

Montgomery of Alamein, V.

Selborne, E.

Morris, L.

Skelmersdale, L.

Mottistone, L.

Skidelsky, L.

Murton of Lindisfarne, L.

Stewartby, L.

Napier and Ettrick, L.

Stodart of Leaston, L.

Newall, L.

Strathclyde, L.

Norfolk, D.

Strathmore and Kinghorne, E. [Teller.]

Norrie, L.

Orkney, E.

Sudeley, L.

Oxfuird, V.

Swinfen, L.

Pearson of Rannoch, L.

Thomas of Gwydir, L.

Pender, L.

Trumpington, B.

Peyton of Yeovil, L.

Ullswater, V.

Prentice, L.

Vivian, L.

Rankeillour, L.

Wakeham, L. [Lord Privy Seal.]

Rennell, L.

Rodger of Earlsferry, L.

Wyatt of Weeford, L.

St. Davids, V.

Wynford, L.

St. John of Bletso, L.

NOT-CONTENTS

Addington, L.

Kirkhill, L.

Alport, L.

Kirkwood, L.

Ardwick, L.

Lawrence, L.

Ashley of Stoke, L.

Llewelyn-Davies of Hastoe, B.

Auckland, L.

Lockwood, B.

Beaumont of Whitley, L.

Macaulay of Bragar, L.

Blease, L.

McCarthy, L.

Brimelow, L.

Mackie of Benshie, L.

Broadbridge, L.

McNair, L.

Carmichael of Kelvingrove, L.

Mallalieu, B.

Carter, L.

Masham of Ilton, B.

Cledwyn of Penrhos, L.

Merlyn-Rees, L.

Clinton-Davis, L.

Molloy, L.

Cocks of Hartcliffe, L.

Morris of Castle Morris, L.

Darcy (de Knayth), B.

Nicol, B.

David, B.

Ogmore, L.

Dean of Beswick, L.

Peston, L.

Dormand of Easington, L.

Pitt of Hampstead, L.

Eatwell, L.

Prys-Davies, L.

Ewing of Kirkford, L.

Rea, L.

Fisher of Rednal, B.

Redesdale, L.

Fitt, L.

Richard, L.

Gallacher, L.

Robson of Kiddington, B.

Galpern, L.

Rochester, L. [Teller.]

Gardner of Parkes, B.

Rodgers of Quarry Bank, L.

Gilmour of Craigmillar, L.

Russell, E.

Glenamara, L.

Seear, B.

Graham of Edmonton, L. [Teller.]

Sefton of Garston, L.

Serota, B.

Grey, E.

Shackleton, L.

Hamwee, B.

Stoddart of Swindon, L.

Harris of Greenwich, L.

Strafford, E.

Henderson of Brompton, L.

Taylor of Blackburn, L.

Hilton of Eggardon, B.

Taylor of Gryfe, L.

Hollick, L.

Tordoff, L.

Hollis of Heigham, B.

Turner of Camden, B.

Houghton of Sowerby, L.

Varley, L.

Howie of Troon, L.

Wedderburn of Charlton, L.

Jay of Paddington, B.

Whaddon, L.

Jeger, B.

White, B.

Jenkins of Hillhead, L.

Williams of Elvel, L,

Judd, L.

Winchilsea and Nottingham, E.

Kilbracken, L.

Wise, L.

Resolved in the affirmative, and Clause 31 agreed to accordingly.
7.1 p.m.
Baroness Turner of Camden Baroness Turner of Camden moved Amendment No. 224:
After Clause 31, insert the following new clause:
("Report by the Secretary of State following abolition of wages councils
.—(1) The Secretary of State shall present annually to both Houses of Parliament a report on the pay and working conditions of employees in industries formerly covered by

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wages councils and in the security and private residential care industries, having consulted the Trades Union Congress, the Confederation of British Industry, the representatives of employers and employees in the industries concerned and such bodies concerned with low pay and equal opportunities as he thinks fit.
(2) The first such report shall be presented within 12 months of the day on which the wages councils are abolished.").
The noble Baroness said: Again we return to some of the arguments made on the previous amendments. We have just voted on wages councils and the Committee has agreed that the clause shall stand part of the Bill. But we have said repeatedly that wages councils cover the poorest and most vulnerable in the workforce. It has not been disputed that large numbers of women and those from ethnic minorities are involved. Most are not unionised. Indeed, the industries covered by wages councils have been notoriously difficult to organise. There are many reasons for that, not least that many of the unskilled and vulnerable people are too scared of losing what employment they have to put it at risk by joining a union.
We have had a long and interesting debate on the whole issue and there is little point in covering it again. However, the amendment tries to continue the commitment which was to some extent undertaken by wages councils. The amendment seeks to transfer it to the Secretary of State. If there are no wages councils, the people formerly covered by them should not be abandoned altogether nor, as Members of the Committee have already said, should we rely on the social security system to subsidise bad employers. The market will not look after those people; quite the contrary. Without wages councils, they will be entirely vulnerable to exploitation.
That is less likely to be the case if the employers involved realise that they are to be the subject of some form of monitoring and that Parliament will be watching via a report to see precisely how they are behaving towards their employees. As we said in the earlier debates, we are not talking about people who can command very high wage rates. Even the wages councils' figures are not high. They range from £2.63 to £3.308 per hour, which is not much by way of remuneration. Now we have passed the Motion that the clause stand part of the Bill, I hope that this amendment, which seeks to give some form of cover and some kind of monitoring to those industries where there were once wages councils, will have the support of the Committee. I beg to move.
Viscount Ullswater: The amendment would require the production of an annual report on the pay and working conditions of employees affected by the repeal of Part II of the Wages Act 1986 of workers in the security and private residential care industries and, as drafted, also those affected by earlier wages councils abolitions.
The purpose can only be to establish a platform for further debate on wages councils after they have been abolished. The new clause stipulates that the TUC, the CBI, employer and employee bodies for the relevant industries—I presume that that includes trade unions
786
and bodies concerned with low pay and equal opportunities such as the Equal Opportunities Commission—would have to be consulted prior to the production of the annual report. The composition of the consulting bodies means that any subsequent report would be against the background of opinion partly critical of the effects of abolition.
The new clause would not prevent the abolition of wages councils. It would require the Secretary of State to lay before Parliament an annual report on the levels of wages of employees now covered by the councils, those in the security and private residential care industries and those covered by wages councils at any time in the past. I find it difficult to believe that the proposed reports are intended to cover workers in industries some of whose councils were abolished up to 73 years ago. It would reopen to no useful purpose questions already long settled.
The Government already compile and publish detailed annual earnings statistics which derive from the new earnings survey. Copies are available in the Library. Those figures mean that Members of both Houses already have available to them a wider range of high quality data than is available for almost any other country in the European Community.
The security and private residential care industries have never been covered by wages councils and it would be pointless to combine them in a report with industries previously covered by the councils. An association exists within the security industry which has developed guidelines on pay and other working conditions. The security and private residential care industries have been held up as example of low paying industries. In those industries, where free collective bargaining exists, the average gross hourly pay, excluding overtime, for a full-time male worker in the occupation "security guard and related industries" in April 1992 was £5.13. The gross hourly rate for a full-time female worker in the occupational category "hospital and nursing homes" was £3.99 per hour. Those hourly rates are not much different from average rates of pay for manual workers. In any event, it is for employers and workers to agree terms and conditions of employment.
The amendment is not an attempt to improve the clause. It is either irrelevant or seeks to delay abolition. I urge the Committee to reject it.
Baroness Turner of Camden: I am not surprised by the noble Viscount's response to the amendment, which was intended to be constructive, and it is based on the decision taken by the Committee to accept the clause which abolishes wages councils.
I am surprised by some of the rates given by the noble Viscount. I have information about security pay. For example, for a security guard, the rate is £2.30 per hour. It is not unusual for a guard to receive less than £2 per hour for that kind of work. For nursing auxiliaries I have a figure of £2.42 per hour. Those are not high rates of pay. One reason that those industries were added to the clause is because employers in those industries are notoriously bad payers. It was felt in drafting the amendment that it

787
might be an idea to have an annual report on those industries where pay is generally rather less good than it alight be.
I do not intend to press the amendment. However, we may wish to return to the issue on Report because I am unwilling to relinquish it without taking further steps to try to protect people who I believe will be grossly exploited if there are no wages councils. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 32 [Constitution of industrial tribunals]:
Baroness Lockwood Baroness Lockwood moved Amendment No. 225:
Page 49, leave out lines 19 to 22.
The noble Baroness said: The purpose of the amendment is to remove the clause, which would open up the possibility of equal pay cases being heard alone by the tribunal chairman. It would have the effect also of removing the possibility of a chairman sitting alone by virtue of the fact that the parties have given their written consent.
I wish to make four points on the amendment. The first relates to the industrial tribunal system. It was designed as a cheap and accessible system to enable unrepresented parties to bring and defend cases. It has not worked out quite as was anticipated because it seemed that it is becoming more and more legal. But to allow industrial tribunal chairman to hear cases alone—and I understand in certain cases in private —would represent a further move towards an increasingly legalistic and inaccessible forum for the administration of justice in equal opportunity and pay cases. That is a matter of concern.
Secondly, the clause presents a further problem for equal opportunities. If we look at the composition of industrial tribunals, we can see that women, black people and members of ethnic minorities are very much under-represented within the entire industrial tribunal system, and particularly so at chairman level. I know the Government have been making efforts to increase the number of women on industrial tribunals but if we were to move in the direction proposed in the Bill it would undermine the role of women on industrial tribunals and it would be counter to what the Government have been doing.
Thirdly, there is concern about the length of time that elapses before the commencement of tribunal proceedings. It is feared that women could increasingly face pressure to allow their equal pay cases to be heard by a tribunal chairman alone. That will not help the position of women because, again, it has been found that it is tribunal chairmen, more than the representatives of the two sides of industry, who seem to suffer from a lack of expertise and training in equal pay matters. I believe that that could be detrimental to women who are putting their cases before a tribunal.
Finally, the Government might like to comment on my next point. It is believed that the Government are trying to shift the burden of delay in the county court system over to the industrial tribunal system by allowing industrial tribunals to hear breach of contract claims. There is already pressure on the county courts. If that pressure is to be shifted to
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industrial tribunals, that again would disadvantage people making claims. If they were to take such a claim to an industrial tribunal rather than to the county court, no legal aid would be available. Furthermore, I understand there is a requirement on the statute book for a deposit of £150. If that were enacted, it could pose yet another deterrent to women making well-founded cases. I would very much appreciate hearing the Government's comments on this situation. I beg to move.
Baroness Turner of Camden: I rise to support my noble friend's amendment. As she has said, the clause in the Bill enables chairmen sitting alone to hear cases. I can understand that the Government are anxious to speed up hearings as there are many delays in industrial tribunal cases and also in EAT hearings. However, I wonder whether this is the correct way to do it.
Industrial tribunals were, of course, originally conceived as a quick and easy way of securing justice in employment matters. It was originally hoped that the proceedings would be simple enough for ordinary employees with no legal training to make their own cases. It has, however, not worked out like that. Things have become more legalistic over the years with the result that the individual applicant is ill-advised, in my opinion, to appear before an industrial tribunal unrepresented.
One of the aspects of industrial tribunals which made them acceptable to all sides was their tripartite nature. There is, of course, the legally qualified chairman assisted by two sidespersons intended to be broadly representative of both employees and employers in industry and commerce. I believe that that was a useful innovation. When making a case for an applicant—I have made a number of cases in my years as a union official—it was helpful to know that the two sidespersons were not professional lawyers but had some knowledge of working conditions and industrial relations practice. The provision that it is all right for a chairman to sit on his or her own undermines the confidence that applicants may have that those adjudicating will have some idea of the kind of conditions at work with which they may have had to contend.
As I said earlier, if the Government wish to speed up the processes, this is not the way to do it. Nor do I believe that it is a shortage of suitable sidespersons that is responsible for delays. I rather suspect that there is an ideological reason for the proposition, as with so many others in this Bill. The Government do not like tripartitism. They are not against quangos in general. After all, it is always possible to appoint to quangos those with the right outlook—the "one of us" syndrome. However, in industrial relations, tripartitism is bound to involve ensuring that employees are somehow represented, mainly as a result of union nominations. I suspect that the Government do not like that very much.
However, it is not just unions and ordinary employees who are less than happy about this prospect. I was recently visited in this Chamber by two representatives of an employers' federation which had in membership a number of small firms. They viewed

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the provision allowing a legally qualified chairman to sit alone as importing yet more legalism into the system. They think that if firms are going to have to make a case before a lawyer with no assistance from sidespersons, they will have to spend money on being legally represented whereas under the present system they send along their managers or personnel people. Therefore I support my noble friend's amendment which I believe is useful in the circumstances.
7.15 p.m.
Baroness Seear: I also wish strongly to support this amendment. I have nothing against lawyers as such. They can be pure as the driven snow and I daresay they nearly all are, but the fact remains that one needs an input of people who have real practical experience of industrial relations at the level at which the case is being operated. That was the whole principle of the initial idea of industrial tribunals. It is a great pity that that is to be abandoned because the more things can be settled by agreement between the two sides in industry with the chairman acting to hold the ring, as it were, and to deal with legal matters, the better. However, matters should be considered by people who have real understanding of what goes on at the industrial level. Again, one is bound to suspect that this matter concerns the vendetta that the Government are waging against trade unions. I very much hope that the Government will accept this amendment.
Baroness Gardner of Parkes: I do not support this amendment as I consider the industrial tribunal system works well as it is. I do not consider that people need to be represented officially or formally. In fact I believe that they often do far better by presenting their own case because the people hearing the case then go to great trouble to make them feel at ease and to help them in presenting their case. There is nothing worse than being badly represented at an industrial tribunal. That does one's case harm. There are all kinds of people who set themselves up to represent others in these cases although they are not legally qualified and they do not represent a trade union. They are just people who have created an industry for themselves to present cases before industrial tribunals. Often the applicant bringing the case places great confidence in the person presenting the case and that confidence is far from justified. The applicant fares worse in that situation than if he were presenting his own case.
As regards this amendment, I believe that it would be quite in order in certain circumstances. Often the parties to a case decide not to appear and they ask for a case to be heard in their absence. In that instance it would be practical for the case to be heard in their absence. There are all kinds of reasons why people do not appear in person. They may have taken up new jobs and are not prepared to take time off or they may have moved to another part of the country and decide that the tribunal is being held too far away for them to attend it.
As I understand the position, one can refuse to have one's case heard by the chairman alone or one can give
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reasons why it is inappropriate to have one's case heard by the chairman alone. The amendment concerns the provision where people have given written consent for the case to be heard by the chairman alone. The Government may wish to consider the provision where a person signs an agreement and has 14 days to reconsider it. They may wish to consider introducing a provision whereby one can withdraw one's written consent within so many days of giving it. This amendment concerns written consent. Indeed, breaches of contract have been mentioned by the noble Baroness, Lady Lockwood.
I speak as someone who sits on an industrial tribunal. Very often the contract is so interlinked with the employment issue that we would be pleased to resolve what appears to be a comparatively simple matter for the applicant. The applicant then goes away very dissatisfied. His or her only hope of taking the matter further is by going to court afterwards, which involves a great deal of time and trouble. Yet the matter was fairly straightforward and could have been settled in the tribunal. Therefore, I believe that it would be beneficial for tribunals to have the power to look into contract issues. I do not support the amendment.
Lord Wedderburn of Charlton: I support the amendment of my noble friend Lady Lockwood, although I do not believe that the problems of tripartism are as easy to resolve as has sometimes been represented. The amendment addresses a particular point in the clause. I note that parties who have given their written consent are not able to withdraw it. That appears a curious doctrine. Perhaps it stems from the Government's conviction concerning the sanctity of contract: it can never be varied. However, I foresee people giving consent conditionally, for a practical reason.
As the noble Baroness, Lady Gardner of Parkes, said, it is sometimes difficult to tell how a tribunal will proceed. It does not have the set course of a High Court action. Workers often go from one adviser to another. They may find better advisers during the course of proceedings. Having gone to the tribunal unrepresented they may have given their written consent but, if they are then advised that that is not in their interest, it surely cannot be right that under no circumstances whatever can they subsequently withdraw it. At the least, those words should be deleted or some other condition included in the Bill.
Baroness Denton of Wakefield: I hope that I shall be able to reassure the noble Baronesses and the noble Lord that the Bill largely maintains the current tripartite nature of the tribunal system. Lay members' practical knowledge of employee relations in the workplace can be especially valuable in cases of alleged unfair dismissal and alleged discrimination where the role of women and ethnic minority members is particularly relevant. I note the comment of the noble Baroness concerning low numbers of lay members in those categories.
We do not believe that the great majority of cases will be affected by this provision; for example, unfair dismissal claims and complaints of discrimination on

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grounds of sex and race where the practical knowledge and experience of lay members may be particularly valuable. We would expect that a three-person tribunal would continue to hear such cases.
We believe that those cases generally involving less need for practical experience of employee relations where the lay members play their role, such as Wages Act claims which tend to turn on legal issues and cases which are uncontested by the employer, do not necessarily need to be heard by lay members. Even in those cases the chairman will have discretion—and I hope that this reassures the noble Lord, Lord Wedderburn—to order a hearing by a three-person tribunal if that seems more appropriate in exercising the discretion under subsection (2F) at any stage in the proceedings. Therefore, even in cases where chairmen have been given discretion to sit alone they may well choose not to do so. As the case evolves they can turn to a three-person tribunal. The sit-alone provisions will apply only where appropriate. There is no threat to the quality of decisions.
We intend to monitor carefully the effect of the new provisions to sit alone. We shall consider the results after a reasonable period of experience before coming to any conclusion about the adequacy of the provisions. We hope that by removing some cases it will speed up the hearing of cases for which tripartite sittings are appropriate. We recognise that parties should he fully informed and we shall be taking that into account in the explanatory literature and the forms which people will receive to make certain that they understand where that might be appropriate.
I hope that in view of those assurances the noble Baroness will withdraw her amendment.
Lord McCarthy: Before the noble Baroness sits down perhaps I may ask her a question. If the parties were subsequently to decide that they did not want the tribunal chairman to sit alone, as we understand it at the moment they can do nothing about it because they have given their agreement. If the chairman decides, as he or she may well decide after listening to the case, that the matter is rather more complicated than originally thought and he or she would like side members, would it be possible for the chairman to stop the show and have side members? If it is possible for the chairman to change his or her mind, why can the applicant not do so?
Baroness Denton of Wakefield: We believe that in that instance, as the case proceeds, the expertise and knowledge of the chairman will make it possible for everyone to work towards the best conclusion.
Baroness Lockwood: I thank the noble Baroness for the information which she has provided and in particular for the statement that the Government will monitor the situation before coming to a final conclusion about the effectiveness of the provision. That is very helpful.
I shall consider carefully what the Minister said. I may come back with a further amendment at Report stage depending on how satisfactory I find her statement when I read it in Hansard. In the meantime, I beg leave to withdraw the amendment.
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Amendment, by leave, withdrawn.
Lord Morris: Normally, in moving an amendment, I would be brief, pithy and concise. However, as we have arranged to rise at 7.30 p.m., I do not believe that two and a half minutes is sufficient to allow time for any support which my remarks will undoubtedly generate. Perhaps I may be so bold as to suggest that we rise at this stage. I should be most grateful for any help which my noble friend sitting as Deputy Chairman of Committees and Her Majesty's Government Front Bench can offer in that regard.
Viscount Goschen: I beg to move that the House do now resume. In doing so I suggest that the Committee stage begin again at 8.30 p.m.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Video Recordings Bill [H.L.]
7.28 p.m.
Read a third time.
Clause I [Titles to be assigned to video works for identification purposes]:
Lord Birkett Lord Birkett moved the first Amendment:
Page 1, line 17, leave out ("submitted") and insert ("determined to be suitable").
The noble Lord said: My Lords, this is a very small and technical amendment. As I mentioned to the House at Report stage, it is concerned only with the list of titles. Noble Lords will recall that the Bill streamlines the procedures for providing evidence in the case of prosecutions by providing that there shall be a list which includes for every video a unique title. It must be unique so that there can be no confusion with others.
The title of a video work, in the form which it is approved by the board for certification, is an integral part of the work. The board requires that that title appears on the screen, usually in the opening shots. That title will also appear on the video itself, and on the box. Originally the title was supposed to be the title under which it was submitted to the board for classification. Although it is possible that that might have been interpreted as the final title—it is obviously important that the title of the work shall be the real title under which the video goes out and under which it has received its certificate—it would he clearer to state that the moment of its registration as the title should be when it was determined to be suitable by the board. In other words when it received its certificate. Instead of the word "submitted" I suggest that we insert the words "determined to be suitable" in that clause. I beg to move.
Viscount Astor: My Lords, the issue that the noble Lord, Lord Birkett, raises is a technical one relating to the drafting of the Bill and not to the policy underlying it. During the debate on the Report stage of the Bill, I said that I would look carefully at the implications of the amendment. We have done so and although we were happy with the original wording, we accept that if your Lordships feel that the noble Lord's

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amendment puts the issue beyond doubt we would advise your Lordships to accept the amendment moved by the noble Lord.
Lord Birkett: My Lords, I commend the amendment.
On Question, amendment agreed to.
Lord Birkett Lord Birkett moved the second amendment:
After Clause 2, insert the following new clause:
("Offences due to fault of other person
. After section 14A of the Video Recordings Act 1984 there shall be inserted the following new section—
"Offences due to fault of other person.
14B. Where the commission by any person of an offence under section 9, 10, 13 or 14 of this Act is due to the act or default of some other person that other person shall be guilty of the offence, and a person may be charged with and convicted of the offence by virtue of this section whether or not proceedings are taken against the first-mentioned person."").
The noble Lord said: My Lords, the amendment concerns the famous bypass provision which has been before your Lordships in various forms throughout the Bill. I put the amendment in my name rather than in the name of the noble Baroness, Lady Fisher, not in order to deprive her of any credit for having been so persuasive and clear throughout the debate, but simply because if it were not accepted I would prefer that it stood in my name and no one else's.
The point of the proposed bypass provision was simply to get to grips with one of the evils of the video world. There are distributors who distribute videos, usually of an extremely questionable character, often without certificates, sometimes with false certificates. Many of those videos are the very types which the Video Recordings Act 1984 was brought in to remove —the video nasties. Not all of them fall into that category; a great many do. The problem is that although trading standards officers have the right to prosecute people within their own area, if they discover that the fault lies not with the retailer in their own area but with the distributor in another area, at present they must go to that other area and ask for a prosecution to be brought. Often prosecutions are not brought by local authorities which are too busy or have a different policy and simply fail to mount the necessary prosecution.
The bypass power enables the trading standards officer who first discovers the fault to proceed right the way down the line. It would have a salutary effect on the extremely ugly end of the video trade.
The amendment proposed today is similar to the one proposed by the noble Baroness, Lady Fisher, except that it would be in a new position in the 1984 Act. By inserting the proposed new clause after Section 14A of the Act, and providing that,
"Where the commission by any person of an offence under section 9, 10, 13 or 14 of this Act",
(instead of a general provision under the Act), we would remove some anomalies which might have occurred had the provision been in the old position. For example, let us consider under-age supply. That is to say, a 10 year-old hires or buys a video with an "18" classification. That occurs not infrequently. That offence obviously does not need a bypass power. Quite
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plainly, that can be an offence only in one place. There cannot be someone in another part of the country involved in that offence. The offence takes place where the video is passed over the counter. It was pointed out that a bypass provision would be unnecessary for that, as indeed is the case. The amendment means that the provision applies only where it is effective and necessary. It is therefore an improvement upon the previous amendments moved by the noble Baroness, Lady Fisher. I beg to move.
Baroness Fisher of Rednal: My Lords, I support wholeheartedly the amendment moved by the noble Lord. I thank him for the tribute that he paid me. I hope that the Minister will look kindly at the amendment. The Home Office will have to consider seriously video recordings of all types. A television programme last week on citizen's rights showed quite clearly how video pirates (or whatever we wish to call them) are in the market, whether marketing films, games or whatever.
The issue began with this Bill, but it needs serious consideration because of the way in which the market now operates with the modern technology of video recordings. Referring to the place of first instance, I have defined those persons as the real offenders. However, the person speaking on television last week was far more unkind. He was nearly as unkind as the Minister when referring to such people in a letter to me. On television that representative of recording companies described them not as real offenders but as counterfeiters, bootleggers, parasites and parasites of legitimate trading recording organisations.
If the Government really wish to protect such people, heaven help us in the future. That representative referred to the issue that we are debating: such people have to be traced through from source. Therefore one agrees with the amendment of the noble Lord, Lord Birkett. It simplifies the whole procedure and sounds a little more legal than the amendment which I moved.
For that reason I hope that the noble Viscount will accept the amendment and that it will go to another place with the blessing of this House. I therefore support the amendment.
Lord Elton: My Lords, since we have discussed the amendment in various forms, I made my own inquiries. It is quite clear that there is a problem and that fact is not in dispute. The problem is that a person in a central place may generate counterfeit videos, and videos of a wholly unpleasant nature, and send them under innocent labels as though they were originals produced under licence, or fit for general view, to a number of different destinations. The place where that offence is discovered may be many miles away.
Noble Lords are familiar with this matter, but I quickly remind them that the problem is this. Under existing legislation, when discovery is made the only recourse of the trading standards officer of the local authority in which it is discovered is to pass the information for a prosecution to the place where the material is generated. That is self-evidently an inefficient method of procedure whatever the circumstances. The circumstances now are such that

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even that procedure does not take place. The place where the central offence is dealt with is too overburdened with work to put its own trading standards officers on to it. The police are too overburdened to take on the work and I have to tell my noble friend that during my inquiries I discovered that agencies representing every single local authority in England, Scotland, Wales and Northern Ireland want the amendment. The police want it; the regulatory body itself, ably represented by the noble Lord, Lord Birkett, wants it; the public want it. It therefore falls to the Government to explain why we should not have it, if that is the Government's position.
I know that there were legal objections to the amendment of the noble Baroness, Lady Fisher; I know that there were legal objections to that of the noble Lord, Lord Birkett. He considered them and it will be for him to endorse this, but I understand that he took legal advice and adjusted his amendment to meet the objections. He has spared us all the intricate arguments and it is possible—since it is difficult to think of any other defence that the Minister could advance for rejecting the amendment—that the Minister will advance intricate arguments in another sense which persuade him.
In that case we are debating the wrong issue. The issue is not: should we pass the amendment? It is: should the wrong be addressed and righted by such an amendment? I cannot conceive of any argument whatever which would persuade noble Lords to the contrary. It seems to me that my noble friend is in a position of some embarrassment, from which he could extricate himself were he free to say that the wrong was acknowledged, that the present proposals to right it were deficient, but that the deficiencies would be remedied by Her Majesty's Government in time for the proposals to be accepted in another place.
No doubt behind those arguments stand arguments about the management of time in another place. However, noble Lords would he reassured by the volume of support which such an amendment might have in another place and the complicity in which all parties would indulge to see that it did not take up unreasonable time.
I hope that I have not spoken with too much heat. I admire the work which the Home Office has done to improve legislation by taking the Bill on board. I admire my noble friend's tenacity and perspicacity in improving the Bill since it came to the House. I hope that he will add to the glitter on his laurels by making this simple, sensible, inexpensive and welcome undertaking.
Lord Merlyn-Rees: My Lords, I too wish to speak briefly. I am concerned about the issue that underlies the amendment, which we have discussed on a number of previous occasions. As I explained, I am chairman of the Video Standards Council. We are worried about standards in videos and about violence on TV and in videos, and so, at the moment, temporarily, when famous cases arise, is everyone else in the media. However, the problem will go on. That is why I support, for example, the classification procedure of the BBFC, whose members, if not appointed by the
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Home Office, receive its approval. The amendment comes from a noble Lord whose position in the BBFC receives the approval of the Home Office.
I am concerned about the under-the-counter videos that have not been to the BBFC. So, in preparation for the Minister's reply, I wish to raise two issues which will enable us to focus on tightening up the procedures, so that something can be done about the problem.
Incidentally, I have now seen the correspondence sent to my noble friend Lady Fisher from the Home Office as well as that from the noble Viscount opposite and the Minister of State at the Home Office. At its worst, if I play nasty, narrow politics, I read the correspondence as saying, "Don't press your luck, lads, or we'll withdraw the Bill". In the best interpretation, what it really means is, "We wouldn't like to lose the Bill".
I have no desire to lose the Bill, but I wish to pursue the legal side and then give an explanation of what we might be able to do in the existing situation. I know that the amendment will not be pressed, so this intervention is in order to find out what goes on.
On the legal side—and I do not say this just because the Home Office staff are here—I always, in my periods both as a junior Minister and as Home Secretary, had regard for the legal department of the Home Office. I have not understood what the Government are up to. What the new clause proposes is to insert into the Video Recordings Act a new Clause 14B. Thus, where A's commission of an offence under Section 9 is due to the act or default of another person, B, the latter may be charged. In its letters to my noble friend, the Home Office said that such a bypass provision, though found in other legislation, simply would not work and could not operate. Then it explains.
There is no point in reading out what has been said and written, the Government do not believe that the Video Recordings Act defences can simply be said to mitigate the offence in relation to a particular defendant, leaving an offence to be passed back to someone else. In the view of the Home Office, if one of those defences can be established, there will be no offence at all and a bypass could not operate.
Thus there is no point in us pressing the amendment. Of course that is the view of the Home Office, but, if it is the true and right explanation of the law, there is no point in our pursuing it. However, pointing to the contrast between the wording of Section 24 of the Trade Descriptions Act 1968 and the wording of Section 24(3) of that Act, the Home Office argues that where an offence is established, an offence can still be treated as having been committed for the purposes of the bypass.
There is no point in my going right through the legal explanation, but in the letter to my noble friend Lady Fisher, the noble Viscount said that he saw the attraction of the amendment, but he did not think a bypass would work. The letter states:
"Instead I think we must expect a degree of co-ordination and co-operation between different departments, if necessary, including the financial transfers between authorities which are permitted under the Local Authorities (Goods and Services) Act 1970".

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The precise question I wish to put is this. All right, despite the legal advice given to the BBFC, the strong feelings of the noble Lord who introduced the amendment and of my noble friend Lady Fisher, myself and others, despite all that, we are wrong. But the letter from the noble Viscount says, "Don't worry, we can deal with the situation under the existing law, under the provisions of the local authorities Act".
How does that work? What do we say to the trading standards officers? What do we say—and this is the next point—in explanation to the magistrates' courts in different parts of the country? The Government say that the amendment will not work, therefore how can we carry out the paragraph in the letter sent to my noble friend Lady Fisher? It stated that under the existing law, by transfer financially and otherwise, something can be done about it.
If there is a proper answer to that, I shall sleep better in my bed tonight than I should otherwise have done. In other words, all that we are doing is a waste of time, but something can be done about it. What can be done about it under existing law? Through the Video Standards Council, I shall make sure that we get in touch with the trading standards officers and say, "This is what the Government say you can do, we don't need the amendment which has been sponsored". What can we do under the existing law?
Viscount Astor: My Lords, those of your Lordships who attended the earlier stages in the progress of the Bill will be familiar with the amendment. As the noble Lord, Lord Birkett, said, it was originally proposed by the noble Baroness, Lady Fisher. I have listened with great care to the arguments put forward today by the noble Lord, Lord Birkett, as I have listened to those put forward on previous occasions by the noble Baroness. I have also had the benefit of considering a detailed legal opinion which the noble Lord, Lord Birkett, kindly sent to me, about which I replied to him earlier this week. Today, the noble Lord sent me a further opinion based on the letter that I had sent to him. That too has been carefully considered today by the Government.
As I explained during the debate at Report stage of the Bill, the Government fully accept that the proponents of this change aim to achieve a more effective enforcement of the Video Recordings Act by the trading standards authorities. We all share that aim and all the provisions in the Bill have it as their objective.
Without wishing to get into a complicated legal debate, I am afraid that I must inform noble Lords that, having carefully considered the arguments put to us last week and again today, the Government have taken advice and have not been persuaded that a bypass provision would operate successfully in the context of the Video Recordings Act. We therefore believe that it would not produce the savings in local authority resources which supporters of the amendment had hoped for. In short, our view is still that the amendment would not only fail to achieve its desired results, but, because of the doubts which it could well
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cast on existing aspects of the Act, that its effect could be positively harmful—a result which I am sure noble Lords would wish to avoid.
The noble Lord, Lord Merlyn-Rees, asked me about local authorities. Perhaps I may start by reminding him that at Report stage I said that it was our view that, where there is an extended network of supply, the appropriate way of investigating is by means of close co-operation between differing trading standards authorities. Those local authorities have the power now to make any transfer of funds that they wish from one local authority to another. So if, for example, a trading standards officer in Birmingham discovers that there is a chain which leads back to some other city, but the trading standards officer in that city may for various reasons be swamped with work or is unable to deal with the problem, he can say: "This is important; we want to follow it up. It is important for our city. We will ask the local authority to give you the resources to follow it up. Those are the resources we would have spent in doing it ourselves".
I fully accept that that is not exactly what the noble Lord wants. He wants those trading standards authorities to be able, as it were, to follow that chain themselves. But we think it is important that the trading standards officers work and co-operate with each other. The trading standards officers know their own areas best—indeed they know them very well. Therefore they should be involved. So there is a way forward.
Baroness Fisher of Rednal: My Lords, perhaps I may intervene. I do not suggest that the trading standards authorities do not know. They have a very good electronic network, and offices all round the country know if scares of any description take place. Very often one authority takes a lead on the matter, with the support of all the others—but with the support of evidence, not money. I am not sure that in the dire circumstances in which local authorities find themselves, with cut-backs in funding, that they will pass any money over to another local authority. I am not sure that I would accept that as an argument so far as local authorities are concerned.
I was worried by the Minister's phrase, "positively harmful". I shall be glad if he can define the phrase when he returns to the Dispatch Box.
Viscount Astor: I was addressing the argument put to me by the noble Lord, Lord Merlyn-Rees, about resources. I accept that there could be some reluctance on the part of a local authority to do that. But, if the trading standards officer in that local authority chose to follow it up, there would be an implication for resources. We say that it need not necessarily cost that local authority any more money to achieving the route with the co-operation of the trading standards officer in another authority.
With regard to the point made by the noble Baroness, I made a point about a specific amendment and how that amendment was cast. I did not make a point in terms of the principle of what she wants to do. I think I explained quite fully, not only in the letter but at Report stage. I am sorry that the noble Baroness regards my letter as unkind. I fully accept that it was

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complicated. I felt it was important that the noble Baroness had a full reply setting out exactly why we felt that the amendment did not work.
Lord Merlyn-Rees: My Lords, again I am trying to be helpful in practice. Perhaps I may give an example. In Leeds, in my old constituency, Morley, there is the trading standards office. It has a lot of work to do in many fields. I know (as well as one can) the staff there. Let us suppose, to take a practical example, that they found that the distributor or the illicit manufacturer was in Birmingham. It would be possible, in terms of resources—they would be extra resources, it is true, but the resources would be there anyway, even under the amendment—for trading standards officers to go down to Birmingham and meet the authorities there, present the evidence they had and make sure that the evidence was there for the Birmingham TSO to present the case in the Birmingham court. It is possible, administratively, under the existing legislation for that to be done. That is correct.
Viscount Astor: My Lords, that is the point. Trading standards officers can co-operate with each other and pass any information on.
Lord Elton: My Lords, perhaps my noble friend will forgive me if I ask him a question—since he seeks to persuade us with that argument—which I would otherwise ask before he sat down. Can he tell us whether he is saying that it is possible to go beyond what the noble Lord, Lord Merlyn-Rees, described, and for the trading standards officer in the distant place to authorise money—which my noble friend seems to think that he would have—to be sent to the area in which the offence is taking place to pay for the work that would follow the prosecution to be done there. It seems to me that the shoe that pinches in Birmingham, if that is where the offence is committed, is the time of the trading standards officers. Not only is there unlikely to be money for the man in Cornwall to send a postal order to Birmingham, but the man in Birmingham has his diary full for the next 18 months and will not be able to do the work. How, under those circumstances, does what my noble friend says do anything to address the problem we are trying to solve?
Viscount Astor: My Lords, I address the problem of resources as opposed to time. I tried to explain that if, in the noble Lord's example, a trading standards officer in Leeds did not feel that he had the resources with which to follow up the complaint that had come from a trading standards officer in Birmingham, and if that trading standards officer in Birmingham felt it was an extremely important issue for Birmingham and for his particular area, the local authority could transfer funds so that it could go to the local authority in the other area and say: "We accept that you have a lot of work. Perhaps it is your area where these tapes are being made and then being distributed round the country. You have a lot of complaints coming in and it is a big issue. You are flooded with complaints and therefore we are happy to help you with the resources to deal with that problem". I am not entirely sure
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whether the trading standards officer could do that. If I understood him correctly, I agree with what the noble Lord said.
8 p.m.
Baroness Fisher of Rednal: My Lords., before the noble Viscount moves on from that point, perhaps I may repeat that it is not a matter of just going and making the seizures. It is a case of pursuing the case through the courts. That is a very expensive business. Counsel have to be employed and long procedures have to take place. It is not a matter of saying, "It's £20 or £25. Here you are. Here's the money for your officers." It is a matter of all the court cases, and one may lose the court case as well. I feel sure that Leeds would not then want to send the money down to Birmingham because it would be said, "You lost it, Tommy, and that's a bit of bad luck."
Viscount Astor: My Lords, the noble Baroness appears to imply that there is additional money involved. We are only talking about money that the trading standards department would have spent in its own area following the matter up. If the case is in another area, that other local authority will follow it up. It is not an extra burden. If it were in the area of the original trading standards officer, he would have the burden of expense in following it up. So the money is not additional from that point of view if it results in a satisfactory conclusion from a conviction.
I understand your Lordships' anxiety. I hope that I have been able to explain the Government's view and point out that there are possibilities. The trading standards officers are very concerned about the issue. We know that they co-operate very well with each other. As I said, we listened carefully and gave particularly careful consideration to this matter. We knew that your Lordships were worried about it. But the Government have to advise the House that after such careful consideration we cannot recommend acceptance of the amendment.
Lord Birkett: My Lords, I am deeply disappointed that the Government will not accept the amendment. As the noble Viscount said, we took very distinguished legal opinion on this matter. I accept that legal opinion. It says quite categorically that there will he no harm whatever in a bypass provision to the remainder of the Video Recordings Bill. It also states quite categorically—and I accept that opinion—that there is no reason why a standard bypass provision will not sit perfectly well with the Act. I have an immense weight of legal opinion which says that it will be perfectly possible.
But at the bottom of the amendment lies the fact that there is an evil, as the noble Viscount himself acknowledged. This would have been a simple way to cure it, but the Government will not take it.
One cannot describe the absence of a bypass power as a piece of deregulation, but I fear that it will have exactly that effect. We all know that deregulation is intended to help small traders, and so it has proved. I fear that it will prove so in this case. It will indeed

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immeasurably help the small traders. It is just a pity that the trade of which we are speaking is in pornography and sadism.
This was an opportunity missed. I am well aware that the timetable in another place will not make it sensible should we pass from this House to another place a Bill with controversy hanging from it and with opposition attaching to it. I am well aware of that. I believe that the rest of the Bill is important enough for the provisions to go through. However, in view of this sad, missed opportunity, I very much hope that the noble Viscount will say both to his noble friends and his right honourable friends that, if they care to utter opinions about violence on video and violence on television, they will have a very hollow ring. I shall expect no more words on the subject. More in sorrow than in anger, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Birkett: My Lords, I beg to move that this Bill do now pass.
It is only fair for me to tell your Lordships that, despite the rather uncomfortable things that I have had to say to the Government, I owe a debt to the Home Office and its officials for very courteous and full treatment throughout the passage of the Bill. They have been immensely helpful to me. Although I disagree profoundly with the noble Viscount on the last amendment, he has conducted the Bill with his usual impeccable courtesy. I am obliged to him as I am to all noble Lords who have striven so hard for this measure. I beg to move.
Moved, that the Bill do now pass.—(Lord Birkett.)
Viscount Astor: My Lords, I should like to congratulate the noble Lord, Lord Birkett, on successfully taking this short but important Bill through your Lordships' House. Other noble Lords have made valuable contributions at each stage of the Bill's progress and in particular the noble Lords, Lord Merlyn-Rees and Lord McIntosh of Haringey, my noble friend Lord Elton and the noble Baroness, Lady Fisher.
The Government recognise that all the amendments that have been suggested have been put forward with one overriding aim in mind, which they share with all the provisions of the Bill; namely, the objective of improving the enforcement of the controls which Parliament rightly saw fit to establish in the Video Recordings Act 1984 and which have contributed much to the success that the video industry now enjoys. We appreciate the value of all those suggestions, even when we found ourselves unable to support them. I must point out to the noble Lord, Lord Birkett, with great respect that our advice was different from that given to him. He will understand that even on his Benches the noble and learned Lords do not always agree with each other.
We accepted the amendment suggested by the noble Lord, Lord Merlyn-Rees and the noble Lord, Lord Birkett, to include in the Bill a "due diligence" defence. I am sorry that we were unable to accommodate the amendment of the noble Baroness,
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Lady Fisher, however much we sympathised with her laudable intentions. I hope that I explained the very good reasons why that was not possible.
The Bill has been welcomed on all sides of your Lordships' House. I commend it to your Lordships and I am glad that noble Lords have given it the Third Reading requested by the noble Lord, Lord Birkett. We wish it well in another place.
Lord Graham of Edmonton: My Lords, I speak in the absence of my noble friend Lord McIntosh who, in essence, would want me to echo the words of the Minister. Noble Lords who participated in the Bill are well experienced in the parliamentary realities. The words of the noble Lord, Lord Birkett, were very profound; namely, that it is better to have a Bill that makes progress than to insist in this House on spatchcocking into it a provision which would virtually sound the death knell of the Bill in another place. He was exceedingly wise.
The whole tenor of the debate has been to recognise that good legislation has on occasion appeared to have been brought into disrepute by the activities of an unsavoury sector of a fraternity. The noble Lord, Lord Birkett, with the assistance of my noble friends Lady Fisher and Lord Merlyn-Rees, sought to make some progress toward trying to obliterate some evils. We very much hope that the noble Lord, Lord Birkett, can be assured that the words of the Minister indicate that his Front Benches would not seek to impede the Bill as it stands at the moment. The noble Lord, Lord Birkett, cannot expect more than that. It may not remedy all the ills that have been brought to the house but it certainly goes some way toward doing so.
The Government have been very fair in their treatment of the noble Lord, Lord Birkett, and my noble friends. From this Front Bench I appreciate what the Minister said and incidentally what the noble Lord, Lord Birkett, has done.
Lord Birkett: I am much obliged to the noble Viscount and to your Lordships. I hope that the House will now see fit to let the Bill pass.
On Question, Bill passed and sent to the Commons.

Local Elections (Variation of Limits of Candidates' Election Expenses) (Northern Ireland) Order 1993
The Parliamentary Under-Secretary of State, Northern Ireland Office (the Earl of Arran)The Parliamentary Under-Secretary of State, Northern Ireland Office (the Earl of Arran) rose to move, That the draft order laid before the House on 10th March be approved [24th Report from the Joint Committee].
The noble Earl said: The purpose of the draft order is to increase the limit on candidates' expenses at local elections in Northern Ireland from £184 plus 3.6p per elector to £192 plus 3.8p per elector, the limit which currently applies at local elections in Great Britain.
The local election limits in Great Britain and Northern Ireland are normally kept in line. However, an increase in Great Britain last year was not matched by a corresponding increase in Northern Ireland, mainly because 1992 was not a local election year in

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the Province. This short and simple measure restores parity in time for the local government elections on 19th May.
It is essential that this draft order should come into force at the earliest opportunity so that prospective candidates for the forthcoming district council elections in Northern Ireland know the maximum that they will be able to spend.
I commend the order to your Lordships, and I beg to move.
Moved, That the draft order laid before the House on 10th March be approved—[24th Report from the Joint Committee].—(The Earl of Arran.)
Lord Prys-Davies: My Lords, I thank the noble Earl for introducing the order and for explaining its provisions. For the reasons given by the Minister we are happy to support the order from this side of the House. Bearing in mind that the noble Earl is struggling with a heavy throat or chest infection, I do not propose to trouble him with a series of questions. I merely say that we approve the draft order.
Lord Fitt: My Lords, it may be that in the future we will have a full-scale debate on local government in Northern Ireland. It may be incumbent upon us to do that as soon as possible.
Although the present order brings us into line with other parts of the United Kingdom, it brings an increase of 0.2p on each of the electors in the local government area. However, the Minister must be aware from his experience in Northern Ireland that the order will have little effect. I first fought an election in Northern Ireland in 1955—almost 40 years ago. Although legislation such as this existed, which was supposed to determine how much one could spend, nobody paid it the slightest attention. That is the way it has been at every subsequent election.
The Minister said that it brings the expenses of Northern Ireland into line with Great Britain. But local government in Northern Ireland is totally different from local government in other parts of the United Kingdom. Elections are coming up in May in Northern Ireland. The candidates will not be talking about the powers or responsibilities of local government. Local government in Northern Ireland does not have anything to do with power or responsibility. Those elections will be a minireferendum on the constitutional position of Northern Ireland. The various candidates on either side of the political and religious divide will be urging their supporters to either reject or support the Anglo-Irish Agreement.
The Minister must be aware that in recent weeks some responsible members of the local authorities of Belfast and Portadown have decided to quit local government because they realise that it is going nowhere in Northern Ireland; it has no responsibility. The calibre of the men in some of the councils leaves much to be desired.
Anyone who has any experience of Northern Ireland local government elections will know that at the beginning of the election the candidates tot up how much they are allowed to spend legally. They then set about trying to doctor the figures to suit the legalities.
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The Minister will be aware that at a recent parliamentary election in Northern Ireland the expenses of one of the candidates were seriously called into question by a High Court action. Not everyone in Northern Ireland would agree with the verdict of that court.
In response to bringing the order forward one would hope that in the local government elections which are about to take place, a sufficient number of candidates will be found —given that there is nothing at stake in the local government field—who will stand in the election to express their abhorrence at the terrible series of atrocities which have taken place over the past weeks. If that were to be the outcome of the local government elections, then it may be worthwhile.
The Earl of Arran: My Lords, first, I thank the noble Lord, Lord Prys-Davies, for his understanding and agreement with the draft order. Indeed, I thank him for his commiseration in regard to my regrettable cold. It is nothing that a good glass of Bushmills will not quickly put right when I return to Northern Ireland.
The noble Lord, Lord Fitt, made a general point regarding the limited powers of district councils in Northern Ireland. I can say to him that for a long time it has been the Government's aim to transfer responsibility of a wide range of subjects to local political institutions in Northern Ireland on a basis which must command widespread acceptance throughout the community.
The Government are open to any proposals regarding future arrangements for regional or local government in Northern Ireland which seem likely to prove widely acceptable. But the noble Lord may agree that those issues are best considered on a comprehensive and inclusive basis and not divorced from the context of further political talks.
The recent violence in Northern Ireland and elsewhere is a very real cause for concern. In the Government's view it makes it all the more important that political talks should resume as soon as practicable. Such talks offer the prospect of securing long-term political stability in Northern Ireland and demonstrate the futility of violence. They show that democratically-elected representatives from different parts of the community can work together in the interests of all. Having said that, I commend the order to your Lordships.
On Question, Motion agreed to.
Viscount Long: My Lords, I beg to move that the House do now adjourn during pleasure until 8.30 p.m.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 8.17 to 8.30 p.m.]

Trade Union Reform and Employment Rights Bill
House again in Committee on Clause 32.
Lord Morris Lord Morris moved Amendment No. 226:
Page 49, leave out lines 28 to 32.
The noble Lord said: As a fully paid-up member of the fifth form remove common room it is an enormous relief to be away from the rigours of the senior common room of the economists. However, that does not mean that I move this amendment lightly. I have always believed it to be correct that one of the primary purposes of law reform is to effect or inject certainty into the law. I believe that Clause 32, which attempts to amend the constitution and jurisdiction of industrial tribunals, does not effect certainty. I am also concerned that the clause was against constitutional reality; namely, the division of power between the executive and legislature. For those reasons I ask my noble friends on the Front Bench to consider the amendment very carefully.
I do not suggest that it is outwith the competence of the Government for the clause to affect the constitution and jurisdiction of industrial tribunals, but in so doing they hand over power to the Secretary of State by order to amend the provisions of subsection (2C). That provision clearly defines the jurisdiction of tribunals and those cases that can be heard by a chairman sitting alone. That purport is absolutely sound and I entirely accept it.
However, I find it rather bizarre that the Secretary of State should be given power, without reference to Parliament on something so fundamental as the constitution and jurisdiction of tribunals, to legislate as he goes along, so to speak. This is one area of the law where the livelihood and interests of the individual are affected by a tribunal sitting in a quasi-judicial capacity. There should be a considerable degree of certainty. I cannot believe that it is outwith the competence of government to be more certain. I suspect that the clause has been drafted or considered in a hurry. All I ask my noble friends on the Front Bench is that they take back this matter and consider how to inject into the clause the parameters of the jurisdiction with more precision. It is totally wrong to effect by Order in Council something so fundamental to the constitution at the discretion of the Secretary of State. The words "amend the provision" mean that he can extend or restrict the parameters and powers of industrial tribunals.
I am certain that my noble friend on the Front Bench will raise some extremely cogent arguments about the fact that we live in times of extreme flux and that Her Majesty's Government need the flexibility which this procedure will afford them. I believe very strongly that what is proposed is an erosion of the power of Parliament and an increment of the power of the executive that needs to be considered with great care. It is for that reason that I tabled the amendment. I am grateful that someone with such knowledge, erudition and eloquence on these subjects as the noble Lord, Lord Rochester, has appended his name in support of the amendment.
Lord Rochester: I deny absolutely the reference to my erudition and the rest of it, but I have put my name to the amendment and I gladly support what the noble Lord, Lord Morris, said. It seems wholly wrong that the Secretary of State should be empowered merely by order and without primary legislation to add to the
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number and type of cases on which industrial tribunal chairmen may sit alone without lay members to hear proceedings of this kind.
The noble Baroness, Lady Denton, said earlier that the effects of implementing Clause 32 would be monitored by the Government. I do not believe that that is good enough. Subsection (2D) represents yet another instance of the executive seeking to limit the extent to which Parliament is able to control the way that legislation is implemented. Under this Government the number of such cases grows alarmingly with almost every major Bill that comes before Parliament. It is high time to set a limit on the process, and the Committee can do that by accepting the amendment. I hope very much that the Minister will give very careful consideration to what the noble Lord, Lord Morris, said.
Lord Wedderburn of Charlton: I support the noble Lords who have spoken to this amendment. The more one thinks about it the more serious the matter becomes. I pose two questions for the Minister. Has this any precedent in the juridical sphere of the competence of our courts? Will it or will it not need an order by way of affirmative procedure?
Lastly, and much more importantly, since we know that the Government take a long view on these matters, what is it all about? Members of the Committee have begun to see in this Bill the long term purpose of the past eight or nine years of legislation. I wholly approve of their wisdom in seeing it. We know what it is about. But with this provision we do not know what it is about. The Minister is not advised short term on these measures. What are the possible or likely candidates for territory into the area of which the one-man tribunals might be extended, quite apart from the monitoring which, as the noble Lord said, is another question altogether. We should be given some idea of why these two lines are in the Bill.
Baroness Gardner of Parkes: I believe that a three-person tribunal—I declare an interest here—is extremely valuable. In the 18 years that I have sat, on only one occasion did we not have a unanimous decision. On that occasion, I said to my colleague who did not agree, "Do you often have this problem?". He said, "I regularly have it", so I gather that he was a person who could not agree with anyone.
Without doubt a three-person tribunal gives the applicant and the respondent in each case a feeling of confidence that there is someone there who cares about their case. Although I am not opposed to the idea of a chairman sitting alone on certain occasions, we have to watch anything that might destroy the existing system, which works so well. We must also realise that in certain instances where the chairman will sit on his own—they are quoted in the Bill—instead of there being a saving of time, our chairman has pointed out that there might actually be a loss of time. If a chairman had three members there, he would be able to determine the preliminary point and then go on to a full hearing, if necessary. However, because he would be doing it on his own, he would have to bring people back on another day in order to have the three people there. So there are occasions when such a

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change would certainly not speed things up. That is my comment on the amendment. I shall be interested to hear the Minister's reply.
Lord Henderson of Brompton: I should like to join the congratulations to the noble Lord, Lord Morris, on putting down this amendment. When I read this clause—I can say honestly that it is one of the clauses that I have read from beginning to end—it occurred to me that this was an extraordinary power and as such was one on which I would have expected our recently appointed Delegated Powers Scrutiny Committee to have reported to the House. It is only a couple of weeks since we had the committee's first report. It is already in being and we have approved its terms of reference. I do not wish in the least to say anything against the committee because it has only just started its work, and I have every wish for its success. However, as it is already up and going, this is just the kind of point about which we would have expected to have a signal from it. We have not. That may be because the Bill was introduced before the committee's terms of reference and its first report were approved. Nevertheless, we have time between now and Report. I very much hope that between now and Report stage the committee will take this provision on board and give us its opinion.
Earl Russell: I do not think that any member of the Delegated Powers Scrutiny Committee is in the Chamber. I understand from discussing it with members of the committee that the first Bill on which they are able to exercise their powers in full is the Education Bill. This Bill was too early for them. I entirely agree with the noble Lord, Lord Henderson of Brompton, that this is exactly the kind of provision on which in future we will wish to hear from the committee. Perhaps I may now ask the Minister the basic question. Is this Henry VIII clause necessary, and why?
Baroness Denton of Wakefield: I understand the anxiety that Members of the Committee have expressed, but I sometimes wonder whether it is possible to please everyone. I had felt in the reply to the earlier amendment that the flexibility of saying that we did not believe that there might not be a need to look again at this question was something which Members of the Committee would appreciate. The power is new and experience may show either that other types of case could also successfully be heard by a chairman sitting alone or indeed perhaps that some types of case listed in subsection (2C) are totally unsuitable for this procedure.
Subsection (2D) allows the Secretary of State to make an order to amend the provisions of subsection (2C) should it become apparent that such adjustment would be useful. However, perhaps I may point out to those who have expressed anxiety about the power that subsection (2E) provides that such an order would be subject to the affirmative resolution procedure. Any changes could be introduced only after a debate in both Houses. I hope that will reassure
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Members of the Committee that that is the opportunity for Parliament to examine any suggestions and to comment on them.
I would again reiterate that the Bill largely maintains the current tripartite nature of the tribunal system. We believe, and my noble friend Lady Gardner of Parkes believes, that there could be occasions when what is proposed might be appropriate. Noble Lords would have the opportunity to debate any proposed changes before they are made and to reject any they consider unacceptable. I therefore cannot accept that there would be any advantage—
Lord Stoddart of Swindon: The noble Baroness has just given the impression that the House could amend an order or refuse part of the order. That is not so. Orders are not amendable. The House either agrees with them or does not.
Baroness Denton of Wakefield: I am sorry if I caused concern to the noble Lord, Lord Stoddart, by being casual. I should have said that the House could reject, not amend, any order that it considers unacceptable. I therefore feel that there would not be any advantage in deleting subsections (2D) and (2E) so that changes could be made only by primary legislation. It would delay the process unnecessarily once the need for change was identified, and possibly not to the benefit of people using tribunals, and would perhaps be an inappropriate use of Parliament's time. I would suggest that subsection (2E) provides adequate safeguards to allay any anxieties that Members of the Committee may have. I therefore hope that my noble friend will withdraw his amendment.
Lord McCarthy: Before the noble Baroness sits down, does she not agree that what she is being asked, which she has not answered, is what the Government have in mind? Under subsection (2C) we have employer insolvency, Wages Act claims, breach of contract claims, applicant withdrawal, and uncontested claims where the parties agree to sitting alone. All those matters are covered. This is something new. What can it be if the Secretary of State wants to take additional powers except going into the heart of unfair dismissal claims, sex, race, trade union dismissal claims, and so on. These are at the heart of what industrial tribunals do. What do the Government have in mind? Do they want to go into the heart of what industrial tribunals do?
Baroness Denton of Wakefield: I said that this gave the opportunity to add to the powers or subtract. We are saying that we shall learn from experience and we shall wait for experience and make our judgments.
Lord Morris: I did not realise that I would so swiftly be agreeing with such enthusiasm with the noble Lords, Lord Stoddart and Lord McCarthy; but they both hit, with the precision and ability which they so often demonstrate in this Chamber, the absolute central points. I gained no comfort from my noble friend—I am sorry to say that—about the affirmative procedure with regard to orders in council.

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The only time I have managed to effect not a change in an order in council but to ensure that it was withdrawn was by the most complicated and the most difficult shenanigans outside Parliament and unbelievable wheeling and dealing. I knew full well that in Parliament to throw out an Order in Council is virtually impossible. It was withdrawn. It is an experience which I shall never forget. I have no comfort whatever in the affirmative procedure. The noble Lord, Lord McCarthy, was correct. It is quite clear from this clause that at the time of the drafting of the Bill the Government did not, with any precision, have any idea of the parameters of the jurisdiction which should be covered by a chairman sitting alone. That is fair enough.
Baroness Denton of Wakefield: Before my noble friend sits down, I draw attention to the fact that Members of the Committee may be aware that the clause was originally drafted to allow orders to be made using the negative resolution procedure. But when that was discussed in another place, it became clear that the opportunity to give any proposed changes greater scrutiny offered by the affirmative procedure would be welcomed. At that point subsection (2E) was inserted as a result. I hope that that increases my noble friend's background knowledge.
Lord Morris: The negative procedure is even worse than the affirmative procedure. It is as simple as that and it is not any comfort at all. I am suggesting that my noble friend considers this matter with care. There is plenty of time to take this matter away and to expand (2C) as much as they like. The Government can take out the power given to the Secretary of State which is quite wrong on an issue as important as this. We are talking about a court of law. If the government of the day cannot define within primary legislation the constitution and jurisdiction of what is in effect a court of law affecting the life and livelihood of individuals, there is something very seriously wrong. It is for that reason that I tabled the amendment.
There is a measure of considerable concern about this. Will my noble friend take this matter away and her department consider it with care? I have a very strong feeling that this provision has been dealt with in something of a hurry. At the same time I support the fundamental principle of industrial tribunals to give to those who feel that they have been wronged a cheap and effective way of "coming to law". I entirely accept that and that is right and proper.
This method has always been a sloppy way of drafting primary legislation. I am grateful to the noble Lord, Lord Henderson of Brompton, for his support as regards this matter. He is right in principle. The importance of this point is demonstrated by the mere fact that this Committee has been created. I beseech my noble friend between this stage and Report to take this matter away and reconsider it.
Lord Henderson of Brompton: Before the noble Lord sits down, the important question was put by the noble Earl, Lord Russell; namely, whether or not this
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matter should be in the Bill at all rather than whether or not it should have the affirmative or negative resolution procedure.
Lord Moms: The noble Lord, Lord Henderson, is right. The noble Earl, Lord Russell, made the critically important point that if subsection (2C) had been properly drafted, the necessity for (2D) and (2E) would go straight out of the window. It is as simple as that. I beseech my noble friend to take this matter back with her officials and consider it.
Baroness Denton of Wakefield: I am sorry that I have been unable to give comfort to my noble friend. We obviously read Hansard closely after a Committee stage. I stress that the intention is very much for the Government to learn from the operation and to leave flexibility which will be to the benefit of the industrial tribunals and their users.
Earl Russell: I do not know whether the noble Baroness has read the report to the Delegated Powers Scrutiny Committee. In future departments will have to get used to offering a full justification for the need for these Henry VIII clauses. The committee said very specifically that something more was going to be required than a general invocation of flexibility. I do not believe that anyone is arguing that these clauses are never going to be admitted.
We want to know precisely why the Government feel the need for them on any particular occasion. The noble Baroness also conflated two different parliamentary powers: one is scrutiny and the other is control. As regards scrutiny, I believe that we all agree that the affirmative procedure has value. The question is how far it has value and control. The noble Baroness said that this House had the power to reject an order. I heard that with interest and I welcome it.
On Question, amendment negatived.
Clause 32 agreed to.
Clause 33 [Constitution of employment appeal tribunal]:
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 227:
Page 50, line 27, after ("employers") insert ("or employers in a relevant sector or area of industry or society").
The noble Lord said: In moving this amendment I speak also to Amendment No. 228. This amendment concerns what I find to be the difficult question of bipartisanship in a tribunal. This amendment addresses a clause which relates mainly to the Employment Appeal Tribunal, but it seems foolish to follow through with an amendment which is really to raise a question of principle with the Committee to which it might be possible to return on Report. It is stated that we might consider another step towards specialisation in the membership of the tribunals. It is expressed in the form of the wing persons being not just employers, but possibly employers in a relevant sector of industry and workers similarly defined. That leaves a discretion as to how that is done which no doubt will be monitored in the Government's activities.
I do not move this amendment in the sense that it is an answer to legalism which is a very difficult

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problem. Although I have an interest in the matter, research shows that legalism is not the same as lawyers. Some of the most legalistic people I know are definitely not lawyers albeit that they may work by intuition in senior common rooms.
It is common knowledge that we have begun specialisation in our tribunals, but have not thought whether we want to go through with it or retract it. Perhaps I may make that plain in a practical sense. In sex equality and equal pay cases, and so forth, it is officially accepted that the practice is to seek at least one woman wing person. In racial discrimination cases, the official practice is not the logical equivalent, which is one person from the ethnic minorities, but to make sure that one wing person is experienced in race relations.
As far as the chairmen are concerned—and this provision affects chairmen as well—after his period as president of the employment appeal tribunal, Mr. Justice Waite wrote that an experienced person should be selected for specialist training so as to make a
"selected core of chairmen and members"
on race and sex discrimination cases. He has argued that in a number of places. I know that that view is widely held by those with experience of tribunals. Some say, "No, the industrial tribunal and to some extent the employment appeal tribunal is a kind of industrial jury—more so for the lower tribunals—and they would resist specialisation." One understands why they do, although the evidence, especially that from the Warwick University studies, suggests that specialisation can operate so as to take the edge off legalism.
Perhaps I may look abroad briefly. Although one cannot look there for an answer, it is perhaps worth examining what other people do to suspend the disbelief that ours is the only way of doing things. In France, the well-established tribunals, the Conseils de Proud'hommes, like our industrial tribunals, contain two employers and two workers. For the most part, they do not have legal chairmen and the members are elected. More importantly, they are divided into five industrial and sectoral groups so that the lay judges can understand the industry with which they are dealing. That seems one of their stronger points although the conseils are much criticised on other matters. The Swedish labour courts suggest a kind of "fortified" tripartism. The courts comprise two employers, two employees and two judges, the seventh member being an expert specialising in labour market conditions. There are many other examples, but from those that I have given it can be seen that there are many ways of modifying and improving tripartism.
In Britain we seem to have gone down a curious cul-de-sac in that we can have either a single chairman or three people. That has been the form since 1964 when the tribunals were created, not to serve most of the purposes that they now serve, but by the Ministry of Labour to deal with selective employment tax cases. I know that the Minister is unlikely to accept these probing amendments which ask whether, in his review of the operation of the tribunals and the EAT, he will make it possible for certain areas of jurisdiction to be
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made less legalistic, with luck, by the advance of a certain degree of carefully constructed specialisation. I beg to move.
9 p.m.
Lord McCarthy: I support my noble friend Lord Wedderburn in his amendment. As he says, it is well known that an element of specialisation has been introduced into this matter, especially in relation to sex and race discrimination cases. It is also well known that the effectiveness and the influence of the side members at all levels—even at the somewhat rarefied level of the EAT—is dependent to some extent upon their practical experience, if not on the fact that they can say to a legal chairman, "This is my industry. It is my area and I know this from practical experience."
As we know, the financial sector is very different from manufacturing industry and, of course, the construction industry is a law unto itself. If anybody who knows what goes on in the construction industry or who has worked in the industry gets on to a tribunal, he is able to silence the most overbearing chairman because he can say, "You do not know anything about a building site but I have actually worked on one." People's experience is the main justification and reason for their serving on the tribunals. Therefore, it would be helpful if the Minister could tell us whether the Government are thinking in terms of more specialisation.
Baroness Denton of Wakefield: First, perhaps I should say how delighted I was to hear the noble Lord, Lord Wedderburn of Charlton, saying that he was looking for something slightly less legalistic. I am sure that he was not suggesting that the employment appeal tribunal members fail to fulfil their role adequately because of lack of specialisation. Perhaps I can help him by giving the Government's thinking. The position of the industrial tribunals is not easily comparable with that of the employment appeal tribunal. Appeals in this area are made only on a point of law. There is no question of lay members needing to supply detailed knowledge of the conditions in a particular industry because the industrial tribunal will already have decided on the facts or the case will be sent back for it to do so. Employment appeal tribunal members are chosen for their broad knowledge of the industry. They may well be prominent in their field and there could even be a danger of accusations of bias if they served on cases in which they might be thought to have a professional interest. However unfounded such accusations might be, they could certainly complicate the issues.
It would be difficult to implement provisions governing how the specialised categories could be divided and how the specialisation would be split between the relevant industries. It would mean maintaining a large number of panels. The opportunity for members of the panels to gain experience in a variety of different types of complaint would create some difficulties. Of course, I recognise that there are times when knowledge of a particular sector could be a valuable help, but those occasions must be far outweighed by the number of cases in

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which general industrial experience is the most useful factor. I hope that that has given the noble Lord, Lord Wedderburn, some guidance on the Government's thinking and that, as he said, he will not press the amendment.
Lord Wedderburn of Charlton: I thank the noble Baroness for what she said. She will know, I am sure, that since the days of the noble Earl, Lord Gowrie, and so on, we have become less and less confident of being satisfied by answers from the Government Bench. I am aware that the Employment Appeal Tribunal is different from industrial tribunals. I thought that it would tire the Committee if I drafted amendments relating to them all.
So far as concerns bias, I am sure that the Government know, or, at any rate, have it within their ability to know, because they refer in the Green Paper to numerous foreign systems, that the allegation of bias, or the possibility of bias, is the one factor that does not seem to have arisen in most of the other systems that tried out a little more specialisation.
The noble Baroness has dug a hole in the practice of appointing specialised wing persons to discrimination cases. On what she said, everyone would have sufficient industrial or other social experience to serve as a wing person in those cases, so what on earth are the tribunals doing? Of course I do not take that view. I say that before she puts it to me. I believe it is a good adventure into experience. We need more knowledge of it, and we could do with a little more knowledge of specialisation; but I see we shall not get it under this Government, and so I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 228 and 229 not moved.]
Clause 33 agreed to.
Clause 34 [Extension of power to confer on industrial tribunals jurisdiction in respect of contracts of employment etc.]:
Lord Henderson of Brompton Lord Henderson of Brompton moved Amendment No. 230:
Page 50, line 47, leave out ("may") and insert ("shall").
The noble Lord said: I hope that the Government will agree to accept the amendment, but perhaps in their own form rather than this. It is totally devoid of any party political consideration. I believe that the Government have already gone half way towards agreeing to this amendment in another place. The amendment seeks to correct a state of affairs which exists now, whereby the Secretary of State may make an order to transfer jurisdiction for adjudicating pay-in-lieu-of-notice claims from the county court to an industrial tribunal. The amendment is designed to make it compulsory for industrial tribunals to adjudicate such claims, and not to leave it to any discretion for them to go to the county court.
I know that there is a certain amount of feeling as between the county court and the industrial tribunals; but I should have thought that pay-in-lieu-of-notice claims are admirably suited to the industrial tribunal. I should have thought also that would have been very much in line with the general philosophy of the noble
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and learned Lord the Lord Chancellor of providing for more jurisdictional claims to be made settleable in lower courts rather than the higher courts. As the matter is being pushed down to the second tier of the higher court, it seems reasonable also to relieve the second tier of the higher court by pushing the matter further down to the tribunals. In this case, especially in view of the discussions that have taken place up until now, I should have thought that industrial tribunals were eminently suitable for adjudication in such cases.
Section 131 of the Employment Protection (Consolidation) Act 1978 allows the Secretary of State to make an order for transfer of jurisdiction for such breach of contract actions from the county court to an industrial tribunal. Although that power has been given to the Secretary of State, I believe that it has not been exercised. I wonder why. I wonder why we cannot take the opportunity to transfer that jurisdiction to the lower tribunal.
In a letter to the NACAB dated 10th February this year, Mr. Michael Forsyth, the Minister of State for Employment, said:
"I can assure you, however, that it is the Government's firm intention to bring forward an order to extend the industrial tribunal's jurisdiction to complaints about breaches of employment contract. The details are yet to be decided, and are indeed a matter for the Lord Chancellor".
I hope that by now the noble and learned Lord the Lord Chancellor will have decided that that transfer should take place. Interestingly enough, that was not merely the view of Mr. Michael Forsyth, it was the view of the Law Lords. The noble and learned Lord, Lord Browne-Wilkinson, as reported in a law report, said in the case of Delaney v. Staples:
"This … produces an untidy and unsatisfactory result. On any dismissal, the summary procedure of the Industrial Tribunal under the Act will be exercisable in relation to unpaid wages (in the ordinary sense), holiday pay, commission, maternity leave, but claims relating to the failure to give proper notice will continue to have to be brought in the county court. The employee is therefore forced either to bring two sets of proceedings or to proceed wholly in the county court on a claim for damages".
That, says the noble and learned Lord, is a waste of time. He continues:
"the courts have been suggesting that this power be exercised for nearly 20 years, so far without success. I believe that all your Lordships are of the view that the present unsatisfactory position calls for fresh consideration by the Minister".
I hope that Members of the Committee in this Chamber and noble and learned Lords in the Judicial Committee upstairs will agree to the proposal and save a great deal of time and trouble. I beg to move.
9.15 p.m.
Lord Wise: I support the amendment moved by the noble Lord, Lord Henderson. It seems entirely unnecessary for an employer who believes that he has been unfairly dismissed without notice or payment in lieu to have to bring two sets of proceedings or proceed directly to the county court. The amendment will eliminate that and it appears to be a much fairer procedure. I support the amendment.
Earl Russell: I wish to add one single point in favour of the amendment. It is common knowledge that the Government are anxious to reduce the legal

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aid bill. Avoiding the necessity to have two different sets of proceedings about the same matter in two different places might be one of the more innocuous ways of achieving that aim.
Baroness Denton of Wakefield: I sympathise with the noble Lord, Lord Henderson, and my noble friend Lord Wise in their desire to see an order made under Section 131 of the 1978 Act. The Government are equally keen that such an order should be made, and that is why we have brought forward the measures in Clause 34, which will enable us to do so. Members of the Committee will not be surprised to learn that I cannot accept the amendment as it stands.
Before deciding to make an order under Section 131, we undertook extensive consultation. It was only following that, when the legal advisers of the relevant departments came to draft an order, that defects in the order-making power were discovered. Primary legislation was required to remedy the defects, and the Bill represents a first suitable opportunity to bring forward the necessary provisions.
Naturally, I cannot give a precise date as to when an order will be made. However, the Government are committed to doing so at the earliest possible opportunity. It is our firm intention to bring forward an appropriate order shortly after the Bill gains Royal Assent and Clause 34 comes into force. I hope that that will reassure the noble Lord and that he will feel able to withdraw his amendment.
Lord Henderson of Brompton: I am delighted to receive the noble Baroness's assurance. I am always suspicious about the use of the word "shortly", but I shall have to live with that. Having received her categorical assurance that the matter will be dealt with by order "shortly", I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 231:
Page 51, line 5, at beginning insert ("Without prejudice to a claim brought under section 22A of the Trade Union and Labour Relations (Consolidation) Act 1992,").
The noble Lord said: I move the amendment in order to obtain a government answer to a problem which is bothering many people. I appreciate the limit which the Government intend to impose in regard to jurisdiction relating to personal injuries, and it is one which is normally included in such proposals. However, a problem arises if a breach of the employment contract—let us say, an unlawful order —results in a worker breaking his or her leg. Is there any choice as to the forum? During the years we have had problems with whistle blowers, but this is the problem of the leg breaker. That may happen in consequence of the worker being told to go to an unsafe place of work or some other problem may arise. Exactly what is the extent of the phrase:
"a claim for damages … in respect of personal injuries"?
Does that cut out everything and leave it to the breach of contract proceedings elsewhere? Where is the limit of the jurisdiction? I beg to move.
Baroness Denton of Wakefield: I assume that the noble Lord, Lord Wedderburn, is referring to Section 22(1) (a) of the 1992 Act rather than Section 22A. In that case, I am happy to assure the noble Lord that his amendment is quite unnecessary. The industrial tribunals have no jurisdiction to hear any personal injury claims, whether against trade unions or against anyone else. Such claims must instead be pursued through the civil courts. The Government have no intention of departing from this position, as such cases are clearly quite outside the industrial tribunals' normal area of expertise and experience.
The purpose of new Section 131(3) is to preclude even the theoretical possibility of an order being made under Section 131 to give the tribunals jurisdiction to hear such cases. The civil courts will continue to determine personal injury cases. I hope that, in the light of the assurance I have given, the noble Lord will feel able to withdraw his amendment.
Lord Wedderburn of Charlton: If that is right, if a wrong which is actionable under the new Section 22A or Section 22C in Schedule 5 had a loss attached to it which was partly personal injury and partly not—which may well be the case especially if we enter the field injury to feelings and so on—then two actions will have to be brought instead of one. It may be that that is inevitable but the Government should spell that out more clearly. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Henderson of Brompton Lord Henderson of Brompton moved Amendment No. 232:
Page 51, leave out lines 7 to 14.
The noble Lord said: This amendment is concerned with the introduction into the Bill of a maximum level for claims made for pay in lieu of notice. Hitherto there has been no maximum level. I wonder why that has been done and whether it is necessary or fair to introduce a maximum level.
I cannot understand how this has crept in. Apart from the fact that it seems to me eminently fair that claims of this kind should be met, if justified, by the actual value instead of a maximum value, experience of maximum values, which have obtained until now on unfair dismissal or sex discrimination claims, show that that value has eroded over the years. Despite the fact that there is supposed to be an annual review of limits to take into account the general level of earnings and the national economic situation the figures have nevertheless been eroded.
I am told that in sex discrimination cases in 1980 the limit was £120. In that year the average weekly wage for men and women over the age of 18 was £108.70. In other words, the limit represented 110 per cent. of the average wage. However, by 1991, 11 years later, the financial limit was £198 at a time when the comparable rate of average earnings was £287.70, which represented only 70 per cent. of the average wage. If that kind of erosion is to take place across the board, not only for unfair dismissal and sex discrimination cases, but also for pay in lieu of notice,

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that is discriminating badly against claimants. I should have thought that there was no justification for introducing it into the Bill.
I have further arguments but I should first like to hear what the Minister has to say to justify the introduction of this provision into the Bill. I hope that the Minister may reconsider this matter and perhaps delete it on Report. I beg to move.
Lord Wise: I wish briefly to support the noble Lord, Lord Henderson, on this amendment. It seems to me perfectly possible to determine the amount of loss sustained by an employee who has been unfairly dismissed without notice or without payment in lieu. Employees' or workers' earnings are all reflected in the amount that they can spend weekly. Their outgoings are determined by the amount they earn. If a sudden loss of earnings is experienced, problems must inevitably arise. It seems to me that it is only fair that they should receive a full payment and not just a maxim um payment, whatever that may be. Therefore I entirely support the noble Lord, Lord Henderson, on this amendment.
Earl Russell: One of the difficulties with putting maximum limits on things is that they need uprating. The number of things that need uprating in the course of a year is considerably greater than the number that actually receive uprating. I only need invoke the old dog licence. I appreciate that in any statute which is allowing for uprating there has to be a procedure for revision. But I think that the drafting of the clause, as the Government have it here, is a good deal too vague to be capable of giving satisfaction to the Committee. The Bill states that an order may not exceed,
"such sum as may be specified in the order".
That is definitely a pig in a poke. It is not even a particularly figure hugging poke. One has no idea what is inside this. It would be perfectly possible, as far as I can see, to make an order under this clause that the sum shall not exceed £1. I do not for a moment suggest the Government intend to do that, but this Government is not the only government that will ever exist in the history of the world. I hope that if the clause stays in, it may end up a little more tightly drafted than it is now.
Baroness Denton of Wakefield: As the noble Lord, Lord Henderson, and my noble friend Lord Wise have explained, this amendment would delete the words at Clause 34(c), which make clear that the order-making power in Section 131 of the 1978 Act allows for the placing of an upper limit on the awards which a tribunal can make under this new jurisdiction. I cannot accept the change they have proposed. There are already upper limits on the awards which tribunals can make in most other cases falling within their jurisdiction, and it is entirely reasonable that the order-making power in Section 131 should allow for the setting of such a limit in contractual cases.
It has always been the Government's intention that an upper limit should apply, at least initially until we have had an opportunity to see how the new jurisdiction works out in practice. The words at
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Clause 34(c) are intended to put beyond doubt that the order-making power allows for this, whereas under the existing Section 131 this is unclear.
In answer to the point made by the noble Earl, Lord Russell, I should say that the precise details of the order to be made under Section 131, as amended by Clause 34, are still under consideration. The order will be subject to the affirmative resolution procedure, so Members of the Committee will have ample opportunity to debate its contents, if they wish do to so. I am sure that the noble Earl would not expect me to pre-empt decisions by the noble and learned Lord the Lord Chancellor and the noble and learned Lord the Lord Advocate—the Ministers who will be responsible for making orders under the amended power. However, an appropriate precedent may be the limit which applies to compensation in ordinary unfair dismissal cases. Applicants who wish to claim damages above the limit set will still be able to pursue their case through the civil courts, as at present. I hope that the noble Lord will consider withdrawing the amendment.
Lord Henderson of Brompton: Can the noble Baroness tell me whether, if claimants wish to pursue in the civil courts their claims against a maximum which has been set, they will be eligible for legal aid?
9.30 p.m.
Baroness Denton of Wakefield: As the noble Lord, Lord Henderson of Brompton, must know, that will be a question of whether or not they are entitled to legal aid.
Lord Henderson of Brompton: I was not at all sure whether they would be entitled to legal aid before the industrial tribunal. My question was whether they would be entitled to legal aid, if eligible, before the civil courts?
Baroness Denton of Wakefield: Going into the civil courts takes them into the legal aid area.
Lord Henderson of Brompton: I cannot profess to be entirely satisfied with the answer of the noble Baroness. The noble Lord, Lord Wise, and I wished to know why this measure has been introduced at all, to the detriment of the claimant. The only answer which the noble Baroness gave was that industrial tribunals have maximum limits in respect of other claims. That does not seem to me to be an answer at all.
As the noble Lord, Lord Wise, said, a man or woman is at a great disadvantage when he or she is suddenly out of a job and has no pay in lieu. It is a matter of great significance whether he or she receives an arbitrary maximum or his or her appointed due through the industrial tribunal. It is a matter of some significance when seen from the point of view of the person who has been dismissed and is suddenly out of employment.
I wonder whether it would not be possible for the noble Baroness to consider the matter on that ground rather than from the point of view of tidiness and equating it with other forms of jurisdiction before the industrial tribunal.
Baroness Denton of Wakefield: We have not considered the matter simply from the point of view of tidiness. The industrial tribunal offers people a means of taking their cases forward. As I said, the answer to the above-the-limit situation must be to go to the civil courts.
Lord Rochester: Is it not the case that industrial tribunal cases do not lend themselves to legal aid, so that legal aid is not available to claimants in industrial tribunal cases?
Baroness Denton of Wakefield: Legal aid is not available in industrial tribunals. It is available if the claimant goes through the civil courts.
Lord Wedderburn of Charlton: Will the noble Baroness consider this point for the future? If the Government are considering this matter, which has been opened up considerably in this debate, will they also consider a phrase which has been causing great perplexity in some circles, namely what is meant by:
"a number of claims relating to the same contract"?
I do not ask the noble Baroness to explain that now but perhaps the Government will consider that phrase for when we return to the matter at Report stage.
Lord Henderson of Brompton: I am grateful to those Members of the Committee who have taken part in this brief debate. We have demonstrated that there are matters to he considered, and not only in relation to what the noble Lord, Lord Wedderburn, has just said. The noble Baroness and her colleagues might weigh in the balance tidiness and convenience as against humanity. They might consider the plight of a man who is out of a job and, as the noble Lord, Lord Wise, said, needs consideration. He should receive his just due and not merely an arbitrary maximum.
I have a feeling that the noble Baroness will consider the matter between now and Report stage. I am very grateful to her for that. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No 233 not moved.]
Clause 34 agreed to.
Viscount Ullswater Viscount Ullswater moved Amendment No. 233A:
After Clause 34, insert the following new clause:
Restriction of publicity in cases involving sexual misconduct: industrial tribunals
(".—(1) Schedule 9 to the 1978 Act (regulations for industrial tribunals) shall be amended by the insertion in paragraph 1 of the following.
(2) After sub-paragraph (4) there shall be inserted—
"(4A) The regulations may include provision—

(a) for cases involving allegations of the commission of sexual offences, for securing that the registration or other making available of documents or decisions shall be so effected as to prevent the identification of any person affected by the allegation;

(b) for cases involving allegations of sexual misconduct, enabling an industrial tribunal, on the application of any party to proceedings before it or of its own motion, to make a restricted reporting order having effect (if not revoked earlier) until the promulgation of the decision of the tribunal.

In this sub-paragraph—
820

"identifying matter", in relation to a person, means any matter likely to lead members of the public to identify him as a person affected by the allegation;

"restricted reporting order" means an order prohibiting the publication in Great Britain of identifying matter in a written publication available to the public or its inclusion in a relevant programme for reception in Great Britain;

"sexual misconduct" means the commission of a sexual offence, sexual harassment or other adverse conduct (of whatever nature) related to sex, and conduct is related to sex whether the relationship with sex lies in the character of the conduct or in its having reference to the sex of the person at whom the conduct is directed;

"sexual offence" means any offence to which section 141A(2) of the Criminal Procedure (Scotland) Act 1975, section 4 of the Sexual Offences (Amendment) Act 1976 or the Sexual Offences (Amendment) Act 1992 applies (offences under the Sexual Offences Act 1956, the Sexual offences (Scotland) Act 1976 and certain other enactments);

and "written publication" and "relevant programme" have the same meaning as in that Act of 1992."
(3) In sub-paragraph (6), after the word "send" there shall be inserted the words "(subject to any regulations under sub-paragraph (4A) (a))".
(4) After sub-paragraph (7) there shall be inserted—

"(8) If any identifying matter is published or included in a relevant programme in contravention of a restricted reporting order the following persons shall be guilty of an offence and liable on summary conviction to a fine not exceeding level 5 on the standard scale—

(a) in the case of publication in a newspaper or periodical, any proprietor, any editor and any publisher of the newspaper or periodical;

(b) in the case of publication in any other form, the person publishing the matter; and

(c) in the case of matter included in a relevant programme—

(i) any body corporate engaged in providing the service in which the programme is included; and

(ii) any person having functions in relation to the programme corresponding to those of an editor of a newspaper.

Expressions used in this sub-paragraph and in sub-paragraph (4A) above have the same meaning in this sub-paragraph as in that sub-paragraph.

(9) Where a person is charged with an offence under sub-paragraph (8) it shall be a defence to prove that at the time of the alleged offence he was not aware, and neither suspected nor had reason to suspect, that the publication or programme in question was of, or (as the case may be) included, the matter in question.

(10) Where an offence under sub-paragraph (8) committed by a body corporate is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of—

(a) a director, manager, secretary or other similar officer of the body corporate, or

(b) a person purporting to act in any such capacity,

he as well as the body corporate shall be guilty of the offence and liable to be proceeded against and punished accordingly.

(11) In relation to a body corporate whose affairs are managed by its members "director", in sub-paragraph (10), means a member of the body corporate."").

The noble Viscount said: It may be for the convenience of the Committee if, in moving the amendment, I speak also to Amendment No. 233B.
It gives me great pleasure to bring forward these two new clauses, which I am sure Members on both

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sides of the Committee will welcome. The new clauses will give industrial tribunals discretionary powers to protect from identification in reports of the proceedings the parties or witnesses in cases involving allegations of sexual harassment. I am sure that noble Lords will be aware of the offensive and sensational coverage some recent cases have attracted.
Harassment at work can make people's lives a misery and some are unwilling to bring their case before a tribunal because they fear that evidence given at the hearing will attract sensational or intrusive media coverage which might identify them. The evidence given at such hearings may include allegations about either party's private life and character as well as detailed descriptions of the alleged harassment. Bringing such a complaint can be a very distressing experience, and it is in the public interest that reporting restrictions should be available in such cases.
The Sexual Offences (Amendment) Act 1992 already makes it an offence to publish reports which identify the alleged victims of indecent assault or other more serious sexual offences unless they give their consent to being identified. The clauses will allow industrial tribunals to bring their own procedures in line with the requirements of that Act by removing from documents available to the public any information which might identify the alleged victim of such an offence or other parties or witnesses.
In addition, when the regulations are made, the clauses will give tribunals a discretion to make a restricted reporting order in cases where that is judged appropriate. That will prevent press reports from including information which leads to the parties or witnesses being identified. Such an order may be made in cases which involve allegations of sexual offences, sexual harassment or other adverse conduct linked to sex or sexuality. Reporting restrictions will therefore be possible in any appropriate case where evidence is likely to be given which includes intimate personal details relating to the sex or sexuality of one or more of the parties or witnesses.
A restricted reporting order will not be made automatically. An application for one may be made by any of the parties to the proceedings or the tribunal may make one on its own initiative. The industrial tribunal will have discretion in deciding whether to make an order. We do not expect large numbers of cases to arise where the circumstances will lead a tribunal to make the order but it is important that the power should be available to protect individuals where that is appropriate. The order may be made at any point during a case and will expire automatically once the tribunal's decision has been promulgated. Transgression of an order is to be a criminal offence punishable by a fine.
The second new clause gives the Employment Appeal Tribunal powers similar to those in respect of appeals against an industrial tribunal's decision or refusal to make an order of the type described above or against any interlocutory decision of a tribunal in a case where such an order had been made.
Calls for discretionary power to protect those involved in sexual harassment cases have come from tribunals themselves. A number of interested organisations have since been consulted for their views on whether the fear of publicity deters individuals from bringing cases involving allegations of sexual harassment or whether there should be support for giving industrial tribunals discretionary powers to protect the witnesses or parties in those cases. The responses suggested that hostile and intrusive publicity is indeed a serious problem in some cases and that as a result some potential applicants are deterred from bringing complaints. Seventy per cent. of those who replied were in favour of the type of discretionary powers laid out in the new clauses being introduced and only 4 per cent.—that is, only one respondent —against.
In conclusion, I hope that all noble Lords will agree with me that the new clauses offer valuable protection to the victims of and witnesses to sexual harassment and indeed to anyone who is falsely accused of such harassment. The Government strongly condemn sexual harassment and hope that these new powers will make the process of bringing an industrial tribunal complaint involving such allegations less distressing, thereby encouraging those who would previously have been deterred from bringing such cases to do so. I beg to move.
Baroness Turner of Camden Baroness Turner of Camden moved, as an amendment to Amendment No. 233A, manuscript Amendment No. 233AA:
Line 10, after ("any person affected by") insert ("or making")
The noble Baroness said: I commend the Government on bringing forward this amendment. Of course, it is absolutely right that privacy should he protected in sex cases. We all know that the newspapers, particularly the tabloids, can be appallingly intrusive in such matters. Unfortunately, salacious gossip is often more likely to attract a headline than serious news.
The reason for my amendment, however, is that it appeared to me that the new clause in Amendment No. 233A, as currently worded, would give protection for the identification of any person affected by the allegation, but would not specifically protect the person making the allegation. Very often, it is the person making the allegation who most needs the protection of such a clause.
I well remember some of the sexual harassment cases in which I was involved as a union official. We won the very first case that we brought before an industrial tribunal on behalf of a member. Nevertheless, it resulted in such intrusive and unpleasant publicity that the young woman concerned was so distressed that she said that had she known what would happen, she would not have brought the case in the first place.
Clearly, from the way in which the noble Viscount moved it, the amendment is intended to deter people from feeling that way and to give them the assurance that they will not be identified in such a manner. My amendment would make it quite clear that not only is the identification protected of any person affected by

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the allegation, but also the person making the allegation. I believe that that is a sensible proposition in the circumstances and hope that the Government will be prepared to accept it. I beg to move.
Lord Mottistone: I believe that the noble Baroness's amendment is splendid, but why did she not put a similar one down to Amendment No. 233B?
Lord Blease: I feel that these are useful new clauses and I wish to support the manuscript amendment put forward by my noble friend Lady Turner. In Northern Ireland this has been an item of considerable discussion among interested groups, particularly the Northern Ireland Equal Opportunities Commission.
I understand that there is no evidence that fear of publicity is deterring applicants from bringing claims of sexual harassment to industrial tribunals. Indeed, it could be argued that the publication of the offence and its consequences could be a deterrent to its practice. Together with many people and public organisations in Northern Ireland, I firmly support the principle in the European Convention on Human Rights that justice should be seen to be done in open court and that an accused should be able to identify his or her accuser. I fully appreciate the stress and embarrassment that may be caused by such hearings, but that is also a feature of other hearings, such as those involving religious discrimination.
The proposals regarding private hearings and the screening of witnesses have a heavy political overtone in the context of Northern Ireland and are already a matter of public disquiet. Along with the Northern Ireland Equal Opportunities Commission I consider it important to be mindful that the industrial tribunal is a civil law court, and that an action for sexual harassment before the industrial court is a civil law action. Proceedings before the industrial tribunals should therefore be quite distinct from those before the criminal courts. There are fundamental differences between the two—not least that a complainant is required to prove a case on the balance of probabilities in civil proceedings, while the complainant in criminal proceedings is required to prove a case beyond reasonable doubt.
The introduction of screening the parties giving evidence may unconsciously lead to the criminalisation of sexual harassment proceedings in the industrial tribunal, which would clearly be inappropriate in view of the role of the tribunals generally. Furthermore, given that industrial tribunals are required to seek to avoid formality in the proceedings, the suggestion that parties and/or witnesses should be permitted to give evidence from behind a screen does not appear to be appropriate. I understand that the screening question formed part of a consultation document that went out to Northern Ireland.
In short, the Equal Opportunities Commission for Northern Ireland, the Northern Ireland trade unions, the labour relations agencies and other public bodies, while endorsing the principle of openness in the administration of justice, would all welcome an explicit statement that industrial tribunals have the
824
discretion to order private hearings. That is the case, I believe, in the amendment put forward by the Minister.
An explicit power in the order for the non-disclosure of the identity of the complainant and the respondent should be firmly identified with any proposals put forward for change. Those measures could be of value in ensuring that sexual harassment cases are properly dealt with. There is anxiety, however, that changes should not be introduced which might undermine the general informality of the industrial tribunal proceedings, perhaps making the procedure more daunting for the complainants. In general, with the proviso of the comments put forward, I feel that would be helpful, certainly in the Northern Ireland context. There is a general welcome for the provision that has been put forward.
Lord Renton: It would seem to follow from what the noble Lord said, that even though the offence is committed in Great Britain, publication should be restricted in the United Kingdom, which includes Northern Ireland. But both in the definition subsection of the new clause, Amendment No. 233A, and when we come to the same definition subsection in Amendment No. 233B, we find that there is restriction of publication in Great Britain. I would have thought that whether the offence is committed in Great Britain or in Northern Ireland, it should be made abundantly plain that publication in Northern Ireland is equally offensive.
Lord Rochester: I support the manuscript amendment of the noble Baroness, Lady Turner, and following what the noble Lord, Lord Mottistone, said. I hope, first, that the noble Viscount, Lord Ullswater, will accept the amendment; and, secondly, that he will either bring forward or accept an amendment in similar terms in the case of Amendment No. 233B at Report stage.
Viscount Ullswater: Before I turn to the amendment itself, perhaps I may deal with the comments made by the noble Lord, Lord Blease. I note what the noble Lord said of the position in Northern Ireland and the concerns that the Equal Opportunities Commission has aired. We need to strike a balance between the proper protection of the individual and the need for open justice. I believe that the Bill has got that right.
The new clause does not apply in Northern Ireland. An order will be required to extend it to Northern Ireland. Perhaps that is the answer to the point raised by my noble friend Lord Renton.
The Government do not propose that hearings should be in private or that parties or witnesses should be screened, as the Northern Ireland Equal Opportunities Commission feared. Views were sought on these proposals and the Government decided not to take them forward. Similar provisions are used in other legislation designed to enforce reporting restrictions: the Sexual Offences (Amendment) Act 1992 and the Children and Young Persons Act 1933, as amended. I understand that they have worked very satisfactorily.

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I turn to the manuscript amendment. It was our intention that the protection from identification should extend to the individual making the complaint as well as potentially to the alleged harasser and witnesses. The amendment helpfully puts that beyond doubt. I am grateful to the noble Baroness for drawing that to our attention and I am happy to accept her amendment. The Government will bring forward on Report minor consequential amendments to ensure that the position is clear throughout both new clauses.
On Question, manuscript Amendment No. 233AA, as an amendment to Amendment No. 233A, agreed to.
Amendment No. 233A, as amended, agreed to.
Viscount Ullswater Viscount Ullswater moved Amendment No. 233B:
After Clause 34, insert the following new clause:
Restriction of publicity in cases involving sexual misconduct: Employment Appeal Tribunal
(".—(1) Schedule 11 to the 1978 Act (Employment Appeal Tribunal) shall be amended by the insertion after paragraph 18 (rules) of the following—

"18A.—(1) Without prejudice to the generality of paragraph 17 the rules may, as respects proceedings to which this paragraph applies, include provision—

(a) for cases involving allegations of the commission of sexual offences, for securing that the registration or other making available of documents or decisions shall be so effected as to prevent the identification of any person affected by the allegation; and

(b) for cases involving allegations of sexual misconduct, enabling the Appeal Tribunal, on the application of any party to the proceedings before it or of its own motion, to make a restricted reporting order having effect (if not revoked earlier) until the promulgation of the decision of the Appeal Tribunal.

(2) This paragraph applies to—

(a) proceedings on an appeal against a decision of an industrial tribunal to make, or not to make, a restricted reporting order; and

(b) proceedings on an appeal against any interlocutory decision of an industrial tribunal in proceedings in which the industrial tribunal has made a restricted reporting order which it has not revoked.

(3) If any identifying matter is published or included in a relevant programme in contravention of a restricted reporting order the following persons shall be guilty of an offence and liable on summary conviction to a fine not exceeding level 5 on the standard scale—

(a) in the case of publication in a newspaper or periodical, any proprietor, any editor and any publisher of the newspaper or periodical;

(b) in the case of publication in any other form, the person publishing the matter; and

(c) in the case of matter included in a relevant programme—

(i) any body corporate engaged in providing the service in which the programme is included; and

(ii) any person having functions in relation to the programme corresponding to those of an editor of a newspaper.

(4) Where a person is charged with an offence under sub-paragraph (3) it shall be a defence to prove that at the time of the alleged offence he was not aware, and neither suspected nor had reason to suspect, that the publication or programme in question was of, or (as the case may be) included, the matter in question.

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(5) Where an offence under sub-paragraph (3) committed by a body corporate is proved to have been committed with the consent or connivance of, or to be attributable to any neglect on the part of—

(a) a director, manager, secretary or other similar officer of the body corporate, or

(b) a person purporting to act in any such capacity,

he as well as the body corporate shall be guilty of the offence and liable to be proceeded against and punished accordingly.

(6) In relation to a body corporate whose affairs are managed by its members "director", in sub-paragraph (5) means a member of the body corporate.

(7) In this paragraph—

"identifying matter", in relation to a person, means any matter likely to lead members of the public to identify him as a person affected by the allegation;

"restricted reporting order" means an order prohibiting the publication in Great Britain of identifying matter in a written publication available to the public or its inclusion in a relevant programme for reception in Great Britain;

"sexual misconduct" means the commission of a sexual offence, sexual harassment or other adverse conduct (of whatever nature) related to sex, and conduct is related to sex whether the relationship with sex lies in the character of the conduct or in its having reference to the sex of the person at whom the conduct is directed;

"sexual offence" means any offence to which section 141A(2) of the Criminal Procedure (Scotland) Act 1975, section 4 of the Sexual Offences (Amendment) Act 1976 or the Sexual Offences (Amendment) Act 1992 applies (offences under the Sexual Offences Act 1956, the Sexual Offences (Scotland) Act 1976 and certain other enactments);

and "written publication" and "relevant programme" have the same meaning as in that Act of 1992."").

The noble Viscount said: I have already spoken to this amendment. I beg to move.
Baroness Turner of Camden Baroness Turner of Camden moved, as an amendment to Amendment No. 233B, manuscript Amendment No. 233BA:
Line 10, after ("any person affected by") insert ("or making")
The noble Baroness said: I am happy to accept Amendment No. 233B in much the same terms as the previous amendment. The manuscript amendment is intended to be inserted in the same place—in paragraph 18A—as in the previous amendment. I beg to move.
On Question, manuscript Amendment No. 233BA, as an amendment to Amendment No. 233B, agreed to. Amendment No. 233B, as amended, agreed to.
Baroness Gardner of Parkes Baroness Gardner of Parkes moved Amendment No. 234:
After Clause 34, insert the following new clause—
("Restriction of vexatious proceedings
.—(1) If, on an application made by the Attorney General under this section, the Employment Appeal Tribunal is satisfied that any person has habitually and persistently and without any reasonable ground—

(a) instituted vexatious proceedings, whether in an Industrial Tribunal or before the Employment Appeal Tribunal, and whether against the same person or against different persons; or

(b) made vexatious applications in any such industrial proceedings whether instituted by him or another;

the Employment Appeal Tribunal may, after hearing that person or giving him an opportunity of being heard, make an Industrial Proceedings Order.
(2) In this section, "Industrial Proceedings Order" means an order that—

(a) no industrial proceedings shall without leave of the Employment Appeal Tribunal be instituted in any Industrial Tribunal or in the Employment Appeal Tribunal by the person against whom the order is made;

(b) any industrial proceedings instituted by him in any Industrial Tribunal or in the Employment Appeal Tribunal before the making of the order shall not be continued by him without the leave of the Employment Appeal Tribunal; and

(c) no application (other than for leave under this section) shall be made by him in any industrial proceedings instituted in any Industrial Tribunal or in the Employment Appeal Tribunal by any person without the leave of the Employment Appeal Tribunal.

(3) An order under subsection (1) may provide that it is to cease to have effect at the end of a specified period, but shall otherwise remain in force indefinitely.
(4) Leave for the institution or continuance of or for the making of an application in any industrial proceedings by a person who is the subject of an order for the time being in force under subsection (I) shall not be given unless the Employment Appeal Tribunal is satisfied that the proceedings or application are not an abuse of the process of the Tribunal in question and that there are reasonable grounds for the proceedings or application.
(5) No appeals shall lie from a decision of the Employment Appeal Tribunal refusing leave for the institution or continuance of, or for the making of an application in, industrial proceedings by a person who is the subject of an order for the time being in force under subsection (1).
(6) A copy of any order made under subsection (1) shall be published in The London Gazette.").
The noble Baroness said: Amendment No. 234 seeks to deal with the issue of the vexatious litigant. Many people are not aware that the problem exists in industrial tribunals. However, a number of individuals persistently bring cases without any real justification and involve the tribunals in an enormous amount of time and expense.
I sat on a hearing where one of the most infamous of vexatious litigants brought a case. He was a highly qualified physicist. He was a European and brought the case on grounds of racial discrimination. He said that the discrimination was that he was not English. In the first case he had applied for a job but was not short-listed by the hospital. He applied for a more senior job and again was not short-listed. The hospital had to send to the hearing two expert witnesses who sat listening to the case for two whole days.
In the first instance the hospital said that the applicant was far too experienced to just run around handing out photographic plates. In the second instance they said that, although he was well qualified, he had never dealt with human beings. They wanted someone with experience of human X-rays rather than concrete slabs. After two days the case was thrown out. During that time I put to him, "I see from the record that you have brought about 30 cases against the health service in different parts of the country". He said, "No, I have brought over 70". I understand that as time went by that number went up to 100. I understand also that he was not alone and that there were a number of other similar cases.
When the system is abused in that way it brings the tribunals into disrepute. I therefore tabled the amendment. In the legal process there is a means
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whereby someone can be declared a vexatious litigant, but there are no means whereby that can be done in a n industrial tribunal process. I am open to an alteration in the wording or the process by which it can be done. It is the principle with which I am concerned.
I should like to explain, briefly, why the amendment is worded as it is. First, the application should go through the Attorney-General's office. I consulted with various noble and learned Lords in this Chamber and they made it clear that it would be more official in that way. That is where vexatious litigants are dealt with so a system is already in place that may be used.
Secondly, I believe that the application should be made to the Employment Appeal Tribunal and a decision reached there. The various types of order are listed in the clause. One of the most important points is that the application to bring proceedings thereafter should be made to the Employment Appeal Tribunal and not to the High Court. The reason for that is that in the past there was a situation when indeed the litigant to whom I referred went through a different process whereby he served a writ on the tribunal. In this case therefore it came to court, but the divisional court of the Queen's Bench Division wholly failed to appreciate the problems experienced by the industrial tribunal. The matter was therefore adjourned. Of course, when it was adjourned many more originating applications from the same person immediately appeared.
The Employment Appeal Tribunal would have to introduce special rules for the procedure, but I am sure that that could be managed. Also there should be no appeal to the Court of Appeal from the Employment Appeal Tribunal in connection with vexatious litigants.
I was a little surprised about the procedure in the legal system of publishing or gazetting the names of the litigants. However, I understand from consultations I have had that that is an important part of the procedure. It means that any application to any tribunal anywhere would immediately enable people to check that a person was not on what would be a small list of people classified as vexatious litigants.
I believe it is important, therefore, that the power should be given to the employment tribunals and to the Employment Appeal Tribunal. I beg to move.
10 p.m.
Baroness Turner of Camden: I understand the concern of the noble Baroness, Lady Gardner of Parkes, about vexatious litigants. What bothers me is that there can always be the odd individual whom everyone regards as a terrible nuisance but ultimately may have a good case. There are such cases on record. As I understand the situation, I believe it is now obligatory for a litigant to make a payment of £150 before the case is heard. I should have thought that that would be sufficient disincentive for someone mad enough to pursue a case with no basis at all. I feel a little unhappy about the amendment moved by the noble Baroness, although I understand that if such cases as she mentions come before the tribunal it can be extremely annoying. No doubt she and others feel

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that it is a terrible waste of public money and time. However, I believe that we have to be rather careful about an amendment of this kind.
Baroness Gardner of Parkes: I hope that the Committee will allow me to reply. The noble Baroness kindly mentioned to me the point about the payment of £150. This afternoon I phoned the office that registered all tribunal applications for the whole of England and Wales and discovered that at no time up to the present had anyone been charged £150.
Viscount Ullswater: I have listened with very great interest to my noble friend's remarks in moving this amendment. I have every sympathy with what she is aiming to achieve. Fortunately, nuisance claimants are not a common problem in the industrial tribunal system, but they can occur, as my noble friend has so clearly demonstrated. Cases such as she has mentioned create entirely unnecessary and unjustifiable burdens on employers who have to defend themselves against unwarranted accusations. They are also a considerable drain on the tribunal resources and cause immense amounts of futile work for the staff and judiciary, especially since it is one or two particular regions which generally bear the brunt of these claims. This is particularly undesirable at a time when the tribunals are under considerable pressure. I am very grateful to the noble Baroness for bringing this matter to our attention.
I have to say to the noble Baroness, Lady Turner, that the deposit procedure is not yet in operation. Even if it were it would he doubtful that it would be sufficient to deter such a determined litigant as we would aim to cover who might be prepared to bring as many as 100 hopeless cases before a tribunal. A vexatious litigant would already be accustomed to paying costs for bringing frivolous, vexatious or otherwise unreasonable cases. Industrial tribunals already have a pre-hearing assessment procedure under which a party may be warned that costs can be awarded if they continue with their cases and lose. That procedure has been unsuccessful in the cases we have been discussing and costs have been awarded without deterring further applications.
I welcome the proposal to give the Employment Appeal Tribunal (as a court well versed in industrial tribunal procedures) additional powers to deal with vexatious litigants before itself and industrial tribunals. Nevertheless, I must ask for a little more time to consider the best way to tackle the problem. I hope the noble Baroness will agree to withdraw her amendment on the understanding that the Government will bring forward at Report stage their own amendment extending the power of the EAT to make orders which will restrict the ability of vexatious litigants to take proceedings in the Employment Appeal Tribunal and industrial tribunals. I ask my noble friend to withdraw her amendment.
Lord McCarthy: Before the noble Viscount sits down, perhaps I may say it is amazing that the ability to introduce the deposit procedure has been in existence since the introduction of the 1990 Act and
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we are told that it is not yet operative. Is that possibly due to the fact that those who operate the tribunal do not find any requirement for it? May it not be that there are no vexatious litigants and therefore we are running before we walk?
Viscount Ullswater: I find it difficult to go along with what the noble Lord has said when we have just heard in Committee the remarks of my noble friend Lady Gardner. I understand that there are such litigants and I shall need to consider very carefully whether further steps should be taken.
Baroness Gardner of Parkes: I thank my noble friend for that answer. We discussed the matter of vexatious litigants and I remember that it was a factor in deciding on £150 when it was debated last time. As my noble friend said, even the costs that have been awarded have not deterred people. Local authorities and health services in particular would be very grateful to feel that tribunals had these powers. I accept that my noble friend will need to look at the exact way of wording this and how it should be done. I would be happy for him to bring forward a government amendment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 35 [Functions of ACAS]:
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 235:
Page 51, line 25, after ("substituted") insert ("to encourage, in accordance with article 118B of the Treaty of Rome as amended, the promotion of consultation and negotiation within the social dialogue between management and labour,").
The noble Lord said: This amendment concerns the functions of ACAS. There are many who would think that nothing is more important to the operation of our industrial relations and its institutions than the operation of ACAS. Therefore, when a Bill comes along to amend the central functions of ACAS for the first time since 1975, it should surely be taken very seriously.
Since 1975 ACAS has had the general duty to promote the improvement of industrial relations—and that stays—but it has also had a particular duty to encourage the extension of collective bargaining and development, where necessary, or reform of collective bargaining machinery. The Government's Bill in its first version cut out the references to encouraging and reforming collective bargaining and now, in the version that the Committee has before it, they have substituted,
"in particular, by exercising its functions in relation to the settlement of trade disputes",
maintaining the excision of all reference to collective bargaining. Indeed, it is a matter of great concern just what will be the general jurisdiction of ACAS if the provision goes through as it stands.
I have taken a reference point which is short, as it were, of extending and reforming collective bargaining. In a sense it offers the Government half of their point, but my amendment retains another half which I should have thought must be part of our obligations in regard to Article 118b of the European Treaty. I refer to the promotion of consultation and negotiation

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within the social dialogue. I am using Euro-speak, for want of anything better, but it is now the official language of our law, so I use it. I do not advance this as necessarily believing that the social dialogue is an answer to many problems in itself. There are some of us who believe that the social dimension of the treaty has been, as M. Delors said himself the other day, notably lacking in development in the past year or so. It is a serious problem. But the Government adhere to the treaty—the treaty without Maastricht but it will not be any different after Maastricht because this is one of the articles which the Government maintain in its present form by not adhering to the so-called social chapter. This is what the Government believe they are obliged to honour—Article 118b.
The social dialogue is there referred to as being the job of the Commission to develop. The article states:
"The Commission shall endeavour to develop the dialogue between management and labour at European level which can lead to agreements"
If the Commission is to be able to do that job under the treaty it cannot possibly succeed if it is frustrated by governments who refuse to lend a hand at the national level, not least because agreements at European level—this is the real problem with them—can only take effect, not because of the doctrine of subsidiarity but because of the facts of life, in the different national diverse legal and industrial systems. Therefore the Government must owe some kind of duty here. What that duty is will surely be carried out in terms of inquiry, advice and encouragement—not necessarily by way of legal duty but by encouragement by a body such as ACAS. Indeed there is no other. It would seem to follow that with the Government now abandoning the job of ACAS to encourage and extend collective bargaining they cannot leave the functions of ACAS without some point of reference in regard especially to consultation and, indeed, on occasions under Article 118b, to negotiation.
To develop this machinery one could have put the matter much higher. It can be said that the Government are obliged to develop such machinery as that developed at European level through the machinery of the treaties. Why is it that ACAS is not brought into this field? If the Government think carefully about it they will do so. I shall not develop any more the points involved. I am hopeful that the Government will say that they will have another look at the matter. I beg to move.
Lord Rochester: Whatever the merits of collective bargaining, there is no doubt that over the past few years there has been a marked increase in the extent to which such bargaining in industrial and other organisations in the United Kingdom has been replaced by dealings with individual employees. I can understand therefore why the Government have introduced the first part of this clause.
Nevertheless, have some sympathy with the amendment and what the noble Lord, Lord Wedderburn, said about it. In its 1991 report ACAS stated that in response to the Citizen's Charter, it had prepared what it called the ACAS Commitment. That committed the service to the way it carries out its
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statutory duty, among other things in improving industrial relations and fostering employee involvement.
Under the heading "Resolution of Disputes" it stated:
"Before providing assistance ACAS always first encourages parties to make full use of any agreed procedures they may have for negotiation and the settlement of disputes".
That sentence accords closely with the statutory duty set out in Section 210(3) of the 1992 Act. However, under a further heading, "Advice and Assistance on Industrial Relations and Employment Issues" ACAS says that, among other things, it is committed to,
"encouraging the involvement of employees in developing solutions to problems as a prime means of promoting constructive employment relationships".
That is a significant additional undertaking which does not yet feature among ACAS's statutory duties.
It may therefore be fairly said that the encouragement of negotiations by ACAS already has a place in statute, but the promotion of employee involvement does not. In those circumstances, I trust that the Government will agree that in removing from ACAS's statutory duties the encouragement of collective bargaining, they will replace that duty with one to encourage employee involvement in accordance with what ACAS is already doing.
Incidentally, ACAS also practises what it preaches for it has agreed with the trade union side of the ACAS Whitley Council a statement accepting that its staff has the right,

"(a) To be consulted directly or through their representatives so their views can be taken into account before management makes decisions which are likely to affect the circumstances in which they carry on their duties.

(b) To be informed on matters of concern to them as employees and to have the opportunity to respond to that information".

I understand that whereas in the past it was the practice of ACAS simply to offer its advice to organisations in need of assistance, now, wherever possible, the service involves employees as well as employers in seeking solutions to problems. That seems to be employee involvement in practice.
I hope that the Minister will respond constructively to the amendment. If, perhaps understandably, he or she does not feel able to accept it in its present wording, I hope that the Government will at least retain an open mind as to the merits of an amendment which I may bring forward at Report to give statutory backing to ACAS's existing commitment to encourage employee involvement.
10.15 p.m.
Lord Swinfen: I wonder whether my noble friend the Minister would be kind enough to advise the Committee where the full name of ACAS appears in this Bill. I do not think that it is satisfactory to legislate using only initials. I know that this refers to the 1992 Act, but the organisation's full name should appear in this Bill as well.
Lord McCarthy: We are grateful to my noble friend Lord Wedderburn for tabling this amendment which enables us to raise in general (and not merely in the terms in which he has tabled the amendment) the question of what the Government see as the functions

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and role of ACAS in the light of the changes that they are making to the statutory provisions. As my noble friend made clear, the Government propose to take out the reference to,
"in particular, encourage the extension of collective bargaining and, where necessary, the reform of collective bargaining machinery",
which was the phrase on which in the past ACAS built the whole of its advisory functions. For a very short time, ACAS was called the Conciliation and Arbitration Service, but then as a result of reconsidering the situation it emerged as the Advisory, Conciliation and Arbitration Service. It has based its extended functions in the area of advice on that fact—on the fact that that was part of the statutory machinery and its title.
However, the Government have now come along wanting to replace those provisions so that the statutory definition of the functions of ACAS is,
"to promote the improvement of industrial relations, in particular by exercising its functions in relation to the settlement of trade disputes under Sections 210 and 212",
which relate to the conciliation, mediation and arbitration functions of ACAS.
My noble friend Lord Wedderburn wants to include a second alternative revision referring to the Treaty of Rome and to
"the promotion of consultation and negotiation".
I should, of course, be pleased if the Government agreed to that, but if they do not, what becomes of the other functions of ACAS? How far do the Government see this section, which stresses the central core of the role of ACAS as the settlement of trade disputes, as putting some kind of restriction on its activities?
When the Under-Secretary of State was asked on 2nd February in Committee in another place what he thought this was about he said:
"Amendment No. 231 modifies ACAS's statutory terms of reference to place greater emphasis on its core business of dispute resolution".
Justifying the concentration on the core business of dispute resolution, he went on to say:
"At the time of competing demands for ACAS's services and general resource constraints we believe that it is right that the terms of reference provided for in the legislation should give a better steer to ACAS on where its strategic priorities lie".—[Official Report, Commons, Standing Committee F, 2/2/93; col. 676.]
In other words, he was saying that its strategic priorities lie in dispute resolution.
It is well known that the ACAS council itself is concerned about the possible consequences of announcing that its core business is dispute resolution. Anybody who knows anything about industrial relations knows that one does not begin with dispute resolution—that is what comes at the end. Dispute resolution comes when one has failed. If one is trying to improve industrial relations, one is seeking to create a culture and approach in which problems are solved and progress is made. If, as the noble Lord, Lord Rochester, thinks, one focuses on involvement along the way, that is all very well, but one does not focus on dispute resolution because one hopes that there will not be any disputes or at least that any disputes will
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not come to a point where a solution has to be adopted through conciliation, mediation, arbitration and possibly industrial action.
A large part of what ACAS does has nothing to do with dispute resolution. There are its excellent advisory booklets, its excellent papers, its research exercises and the extended advisory services that it puts into any part of the private or public sector which wants it to do so. My question therefore to the Minister—I hope that he will find time to answer me —is: what does it mean if we say that the core business of ACAS shall be dispute resolution? Does it mean that its budget will be slimmed at this difficult time? Its approach is in many ways superior to the approach of the best consultancy, because not only does it have no axe to grind, and is not selling a particular package of means: it wants to find solutions and withdraw. It is the only consultancy of which I am aware that wants to get out of the business. Every other consultancy wants to get one on the hook. It will be sad, wrong and bad for industrial relations generally, if ACAS's core business focus means that it does not carry out all its other important activities.
Viscount Ullswater: I shall perhaps get a minor matter out of the way first. If my noble friend Lord Swinfen will turn to Section 247 in Part VI of the 1992 Act, he will see that it indicates the nature of ACAS, the words themselves and the acronym which is further referred to in the Act.
Lord Swinfen: My noble friend is kind to give me the reference in the 1992 Act, but my question referred to the Bill. It is pure idle draftsmanship not to have the full name in the Bill, which contains no definition of ACAS. It should be in the Bill. It is a matter of idleness on the part of the draftsman, not my noble friend, because it should be in the Bill that we are discussing.
Viscount Ullswater: I do not agree with my noble friend. Bills often make amendments to other Acts without one being able to read them like a book. One sometimes has to be clever to understand what effect amendments have on the main legislation. This is a proper way of going about things. I shall have to disagree with my noble friend.
Perhaps I may deal first with the point made by the noble Lord, Lord McCarthy. He complains that there is a change to Section 213 of the 1992 Act. He asks whether that is the right way to go about matters. Clause 35 deals with one function of ACAS only—the advice side. Rather than go into a whole list of things that it should do, it neatly puts into new Section 213(1):
"such advice as it thinks appropriate on matters concerned with or affecting or likely to affect industrial relations".
I should have thought that that would have given ACAS a broader remit than the existing Section 213(2) gives it. It gives it a broader remit to offer appropriate advice in the right circumstances. I hope that the noble Lord will not feel that we are trying to slim down what ACAS is available to do.
I am speaking also to Amendment No. 236, which is grouped with Amendment No. 235. The main purpose of the amendments is to retain the redundant reference to "collective bargaining" in ACAS's

835
statutory terms of reference. Amendment No. 236 makes this intention explicit. Amendment No. 235 disguises its aim a little by referring to the promotion of negotiation between management and labour.
For years ACAS has not actively promoted the extension of collective bargaining. ACAS will be the first to admit as much. Its activities have moved on with the times. These amendments take us back to the past, however much they try to conceal the fact by being dressed up in rather modish language about the EC's social dialogue.
The reference to consultation in the amendments is quite unnecessary. Clause 35 gives ACAS a general duty:
"to promote the improvement of industrial relations".
If better consultative arrangements between employers and their employees can contribute to improved industrial relations the promotion of such consultative arrangements is clearly within ACAS's new terms of reference. Of course, if consultative arrangements are not calculated to contribute to an improvement in industrial relations, they are not the proper business of ACAS. I say to the noble Lord, Lord Rochester, that ACAS has the powers to consult where necessary and I do not believe that it needs any further powers.
Perhaps I may now turn to the social dialogue. Again, this reference is unnecessary. In lifting this idea from its proper EC context the use of the term is misleading, confusing and perhaps harmful. As Members of the Committee will be aware, "social dialogue" is the term used in the Treaty of Rome to describe the process by which the Commission seeks an exchange of views between bodies representing employers and employees at the European level. The topics for this dialogue are typically connected with draft Community legislation. Article 118B of the EC Treaty, as inserted by the Single European Act, makes it clear that the "social dialogue", as so defined, is a matter for the Commission and the employer/employee bodies concerned. I do not believe that the noble Lord, Lord Wedderburn, and I differ on that. However, it is not the business of member states. There are social dialogue provisions in the Agreement of 11, but of course these will not apply to this country.
Apart from the in-company consultation that I have already discussed, the only other process that the term "social dialogue" could cover is one of elaborate national level consultations and bargaining. That smacks of a return to the stultifying and ineffectual corporatism of the 1970s. There certainly is no role for ACAS in all this.
Deleting mention of collective bargaining from ACAS's terms of reference will have desirable effects. It will confirm current practice and remove any uncertainty as to where ACAS's duty lies. It will help reinforce the message that collective bargaining should not be singled out for special status above any other form of employer-employee relations. And of course it will not prevent ACAS from conciliating in union recognition cases. The amendments seek to
836
wipe out these potential gains and should therefore be resisted. I hope that with that explanation the noble Lord will see fit to withdraw his amendment.
Lord Wedderburn of Charlton: I apologise; I was noting the Minister's points in such depth that I failed to spring to my feet. Let me do so now. I never believe that the draftsman is idle. He may be ingenious and he may be inward but he is rarely idle. ACAS is clear what it is talking about.
I never thought that my reference to one article of the treaty to which the Government are bound and will be bound after Maastricht would set off such a volley; for instance, corporatist, confusing and harmful. If such descriptions go with what the Minister understands to be the social dialogue, he had better persuade the Government to withdraw from Section 218B.
He believes that my proposal is modish—I do not like being modish—and says that we need not retain this redundant reference. I do not follow any of that argument, partly because I disagree with the Minister on one issue of fact. He said that the social dialogue is concerned only with oncoming European Community legislation. With great respect, it is not. As regards the Social Chapter I am aware that the Government do not adhere to the "Agreement of 11", as he called it. My amendment specifically does not make mention of the Social Chapter agreement. It retains a reference to the article by which the Government are bound. An implication of the treaty must be that they have given their word to do what they can, when asked by the Commission, to help in social dialogue, negotiations or consultations. 'They should not simply say no to that request.
ACAS has a central role in that and I do not agree with the Minister that ACAS would necessarily be able to play its role despite—and I accept that it is there—the new Section 213. I give the Minister an example where I think he is wrong in fact. The bodies which constitute the so-called social dialogue—the European trade unions in the ETUC, the private sector employers, the UNICE, to which the CBI is affiliated (and I am glad to see the noble Lord, Lord Mottistone in his place), and the CEEP, the public sector employers—have made two or three agreements on the introduction of technology. Whether or not that could give rise to any kind of collective negotiation that could filter down through member states is actively under discussion. I am sceptical but there are those—and they are not all trade unionists or lawyers—who see that as an extremely important venture.
I hope that the noble Viscount will look again at this matter. I hope that he will take out all the nasty words. I hope that he will keep to Article 118B because that is as far as the Government will go and accept that the social dialogue is part of it. People are trying to see a way to a trans-national, European and wider, system of industrial relations which must be part of the new single market and the new trans-national economic market if working people are to have any chance at all of being protected across the frontiers.

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I can see that the Government do not really believe in that and that it is why they have taken out collective bargaining from Section 209. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 236 not moved.]
Clause 35 agreed to.
10.30 p.m.
Lord Mottistone Lord Mottistone moved Amendment No. 237:
After Clause 35, insert the following new clause:
("Claims
. At the end of subsection (3) of section 133 and subsection (3) of section 134 of the 1978 Act, there shall be inserted—
"(3A) For the purposes of subsection (3), a person shall be deemed to claim where that claim is express or can be implied from the overt acts or attitudes of that person." ").
The noble Lord said: This amendment reflects a view of the judicial committee of this House on the current position at common law. That is necessary as some commentators appear not to be interpreting Sections 133 and 134 of the 1978 Act in accordance with the common law.
CBI officials have made many representations to both ACAS and the Department of Employment concerning the way in which the service is interpreting its duty under this part of the law. In essence, in 1990 ACAS issued guidelines to its conciliation officers as a result of which officers were declining to help employers and employees reach settlements unless the employee, in the words of the statute, "claimed" action had been taken in respect of which he could complain to a tribunal. This has meant that a number of potential settlements have not been reached and, moreover, many employees have in effect been forced to initiate proceedings before an industrial tribunal in order to secure the services of a conciliation officer.
The CBI maintained that ACAS could infer a claim, rather than requiring an express statement to that effect from the employee. In support, one need look only to the case of Moore v. Duport Furniture Products Ltd (reported in 1982 at page 31 of the Industrial Relations Law Reports). In that case, the judicial committee of this House put beyond doubt the issue that claims could and indeed should be inferred.
As the Government have seen fit to amend provisions of the law which deal with ACAS's duties, it appears appropriate to consider clarifying at the same time an area which has been somewhat clouded. It is to be hoped that this will be achieved by putting in statute a clause which will reproduce the existing position as stated by this House exercising its judicial function.
I give an example of what I have been talking about. Let us suppose that W, a worker, is employed by E, the employer. After many years of employment on good terms, the relationship begins to run into difficulties due to W's conduct. E, without giving W any warning, dismisses him. W may well feel that this is unfair; but after much discussion he is persuaded to make an agreement settling the matter whereby he will receive a large sum from E and it will save everyone a lot of time and expense in going to a tribunal.
E and W then go along to an ACAS conciliation officer to have the agreement recorded, thus preventing any further claim to an industrial tribunal. The ACAS officer, however, following the guidelines issued by the service in 1990, refuses to act because, he says, W has not formally or expressly claimed that he was unfairly dismissed. In reality of course the fact that the employee himself believes the dismissal is
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unfair, and has agreed to the involvement of a conciliation officer, should be enough for the officer to infer a "claim" from the circumstances.
This is the problem for business at the moment. ACAS will not infer a claim even though it could do so from the "overt acts or attitudes" of the worker. The net result is that as it is only an agreement reached through the involvement of an ACAS officer which will preclude a subsequent tribunal complaint, the employer, having settled the matter, is still exposed to further proceedings. My amendment will make the position clear by stating in statute what case law already provides—claims can be inferred. I hope that my noble friend will give this matter special consideration. It seems to me a small point but one that could be of considerable importance to many people in business. I beg to move.
Viscount Ullswater: My noble friend's aim is to allow employers and employees to reach binding agreements in settlement of disputes between them without reference to the industrial tribunal system. I have every sympathy with his aims in seeking to promote binding settlements between parties. However, I have doubts about the means he suggests for achieving this.
My noble friend has suggested that it should be within the remit of ACAS to endorse agreements in which it had played no conciliation role. However, in cases where agreement has already been reached, it is by definition impossible for conciliation officers to seek to promote an agreement. There is no dispute outstanding, and therefore no valid role for ACAS to play.
My noble friend referred to the Moore v. Duport case, and in that he is quite correct. However, that is not the issue here. Where a person claims that action has been taken in respect of which a relevant complaint could be presented to a tribunal, it is not necessary that the claim is expressly made. It would include an implied claim which could be inferred from the overt acts or attitudes of the employee. That was the case in Moore v. Duport.
However, it is quite clear that it would be impossible for an ACAS conciliation officer to promote a settlement if one had already been reached. There would be no role for a conciliation officer in such a case. That is what we are considering here. The 1975 legislation which established ACAS's statutory responsibilities never intended that. ACAS should have a retrospective role in rubber-stamping such agreements, and the Government believe that its involvement in such cases would be neither proper nor an appropriate use of its resources.
The Government are, however, aware of employers' anxieties in this area. It is extremely important that the parties in such cases should be able to reach a final settlement which will avoid unnecessary tribunal claims, provided of course that there are adequate safeguards so that individuals are not coerced or misled into signing away their rights unawares.
We have consulted interested organisations on a proposal that agreements which settle an employee's claim and preclude his right of reference to an

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industrial tribunal should be binding if the employee has had legal representation. This proposal was supported by a substantial majority of the respondents, including employers and employers' organisations. Certain safeguards will need to be set, but I believe that this proposal offers an effective way forward which will very largely achieve the objective of my noble friend's amendment, albeit via a somewhat different route. I hope therefore that my noble friend will withdraw his amendment on this occasion after considering my comments this evening, and on the understanding that the Government will bring forward their own amendment on Report.
Baroness Gardner of Parkes: Is the Minister not aware that the present situation is a charade in many cases? Because employers and employees are aware that ACAS will not rubber stamp, as my noble friend has just said, they therefore pretend that no agreement has been reached and go along to ACAS for ACAS to act as if it has acted as conciliator, and then the agreement will be rubber stamped. That is a nonsensical situation.
I welcome the Minister's statement that people will be able to sign agreements. I understand that each party must have legal representation because, as he said, unwise people might sign away their rights. That is good. However, what is wrong with ACAS having the role of rubber stamping agreements which have been reached logically? At present, much ACAS time is being taken up by cases in which agreement has been reached but cannot be acknowledged to have been reached in order for ACAS to be used.
Viscount Ullswater: The practice of validating or rubber stamping agreements reached privately between employers and employees represented such a considerable drain on ACAS's resources until it ceased after ACAS was given legal advice in 1990 that it had no statutory role to do that. In 1989, the year before the service was withdrawn, ACAS dealt with well over 17,000 such cases, representing 36 per cent. of the total number of cases received.
I am glad that my noble friend supports the proposition that I have made, and I hope that both she and my noble friend Lord Mottistone will support me on the way forward that I have suggested.
Lord Mottistone: I am most grateful to my noble friend for his lengthy reply. I am also grateful to my noble friend Lady Gardner for her intervention, which brought out the further figures which show what the situation was before 1990. I must confess that I was puzzled as to why 1990 was a key date, having worked with ACAS in earlier years a great deal.
I fully understand what my noble friend said. I look forward to seeing his amendment at Report stage. I hope that it will provide the solution which we are all keen to see. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 36 [Fees for exercise offunctions by ACAS]: [Amendments Nos. 238 and 239 not moved.]
Clause 36 agreed to.
Clause 37 [Careers services]:
Baroness David Baroness David moved Amendment No. 240:
Page 53, line 2, after ("State") insert ("through local education authorities (in England or Wales) or education authorities (in Scotland), or from persons of any other description following the agreement of the relevant local education authority or education authority")
The noble Baroness said: We now come to Clauses 37 and 38 which deal with the careers service. I am sorry that these important clauses are being discussed at this time of night. I propose to move my amendments briefly so that we have the Minister's response, and I hope that we can return to the matter at a more civilised hour at Report stage to discuss it properly.
Amendment No. 240 is linked with Amendment No. 247. The purpose of the amendments is to ensure that the service is provided through LEAs, or education authorities in Scotland, or a body approved by them and to guarantee local authority involvement in careers service provision.
LEAs assumed responsibility for delivery of the careers service as a result of the provisions of the Employment and Training Act 1973. In 1990 the Employment Department reviewed the arrangements for the provision of careers advice to young people, resulting in the Bruce Report. The local authorities' response was that they should continue to provide the careers service, and it is widely believed that others who were involved in the exercise held the same view. However, the report of the review was not made public, and that is a pity. Leaks suggested that the report recommended retaining the status quo. The Government so far have not brought forward any evidence to suggest why there is a need to change the current arrangements.
We suggest that there are three main reasons why local education authorities should continue to be involved in the provision of the service: to maintain coherence with education service provisions; to provide a check on the impartiality of the advice provided; and to ensure local accountability of the arrangements provided.
There has been remarkably little clarity about what is meant to happen under the new arrangements. Perhaps the Minister will advise us. In the meantime I hope very much that my plea for local education authorities, or a body approved by them, to remain with that commitment to a service will be agreed. I beg to move.
10.45 p.m.
Lord Mottistone: I wish to support in principle what the noble Baroness, Lady David, said. The careers service is far more important than has been recognised over the years. It has not recruited as high a standard of people as is clearly necessary in order to help young people to obtain jobs when they get out into the wider world.
I believe that most of the amendments to which the noble Baroness has put her name require careful thought by my noble friend. In principle they seek to strengthen the position of the careers service in the future that unfolds before us. I hope very much that the Government will be able to do something in that

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respect. I do not propose to take part in debates on further amendments because that will add further speech, and we are running out of time.
Baroness Seear: I strongly support the amendment. The argument as to who should control the advice given to youngsters has continued for over 100 years. After a great deal of argument it was decided that the person giving the advice should consider primarily the career development of the young person and not the satisfaction of local labour market needs. That is what the argument has been about over the years.
It seems plainly right that the service should be regarded as part of the education service which local authorities should be offering to young people. Members of the careers service should be going into schools at an early stage to give youngsters advice on subjects that they ought to be studying in relation to the careers that they might follow. The provision knits those people into the education service. That surely is where they should be. Good advice about careers from a longer-term view than many youngsters are likely to take is absolutely vital if we are to have properly trained people. That is part of the advice that the careers service can give relating to the market opportunities that one hopes will come their way later.
Lord McCarthy: It is to the credit of the Government that they have never come before us with any criticism of the way in which the careers service operates at present. Not only have they not made a case, they have not made a case against the existing system.
There is now an opportunity for the Minister or the noble Baroness to state whether there are criticisms, or defects. Are there matters which were not published in the report but about which we ought to know? On the face of it, all the interested parties, whether they are the education profession, those who use the careers service, bodies such as MENCAP and so on which are concerned with the disabled, do not understand why the LEAs cannot continue to be involved in the service. If the Government are making such a sweeping change, they must criticise the existing situation and say why the biazarre tripartite method that they have invented will get rid of those criticisms and why we should support it. Now is their opportunity.
Lord Stoddart of Swindon: I too wish to support the amendment moved by my noble friend. I simply cannot understand why the Government wish to centralise the service—because that is what they are doing. They seem to be centrist mad. They must take away everything that local authorities do and put it at the centre. Local authorities have run the service for donkey's years; they used to run the youth employment service. I was the chairman of the further education committee in the county borough of Reading: it ran the youth employment service extremely well. So far as I know, there have been no complaints about the way local authorities and their staff run the existing service in co-operation with other organisations.
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As my noble friend Lord McCarthy said, the Government should explain to the House and to the people, particularly those who work in the careers service, why it has been thought necessary to remove the service from the local authorities who have run it so well for so long.
Baroness Denton of Wakefield: Perhaps I may start by agreeing wholeheartedly with the noble Baroness, Lady David, that it is unfortunate that this important matter should be dealt with at this hour. I appreciate the organisation she proposed with her amendments.
The Bill recommends a fundamental change which reflects the importance which the Government attach to careers guidance, both in helping individuals to achieve their potential—I agree wholeheartedly with the noble Baroness, Lady Seear, that the potential for the individual is absolutely crucial —and also in relation to securing an efficient labour market which means work and opportunity.
We seek to secure the future of careers services through new management arrangements that enable them to reflect the changing needs and circumstances of the local community. I know that there is a strong feeling within careers services that they cannot stand still. But we certainly do not underestimate the valuable work which has been done.
In proposing the amendments, the noble Baroness seems to suggest that it is unacceptable to require each and every careers service provider to undertake a thorough review of its operation; to establish arrangements against new and demanding standards; and to demonstrate its accountability to its customers. Obviously, we cannot agree.
It is not just change for the sake of it. We need to recognise that arrangements can be better if options are widened beyond the current constraints of a local education authority. An important advantage of the new arrangements is that they will enable careers services to be provided as a joint venture between the education and employment sector. That will bring with it a better mutual understanding, respect and trust and a significant degree of consensus on aims and intent and open communication. Many training and enterprise councils already welcome these kinds of arrangements and I am confident that we will see them developing closer relationships with education and economic communities.
We want the high standards achieved by the best to be available everywhere and, indeed, improved upon. We believe that organisations which aspire to provide services need to demonstrate, through competitive bidding, that they can meet demanding quality standards and sustain them.
The amendments go to the heart of what we propose and would have a completely negative effect. Accepting them would place a stranglehold on change and continue to allow current providers a monopoly. They would restrict opportunities, not open them up, by allowing the current providers to decide who manages services. This might be more readily understood if the Bill prevented local education and education authorities from providing careers services, but it does not. It fosters genuine competition in which the authorities are absolutely free to play their part. If

845
the local education authorities are everywhere as good at providing careers services as supporters of the amendments claim, they have nothing to fear. I hope, therefore, that the noble Baroness will withdraw her amendments.
Baroness Seear: Before we make a final judgment, I ask the noble Baroness a question. She talks about competition between people, and says that they will be tested as to who provides the best service. Who is the judge of all that? If it is the Secretary of State, is that not once again a centralisation? I have to put it to the noble Baroness (it cannot be news to her) that we are increasingly conscious—I say "conscious", not "apprehensive"—that the Government have as great a vendetta against local authorities as they seem to have against trade unions and that one has only to say that an organisation is run by a local authority for the Government to believe they have to alter it. We cannot find any other reason why they want to alter it. Is that the reason? It is yet again an attempt to undermine local authorities.
Baroness Denton of Wakefield: I say to the noble Baroness that the Secretary of State will make arrangements with the providers through the guidance that she will issue. It is not a vendetta against the local authorities. As I said earlier, local education authorities are all in a position to compete for provision, and, if they are indeed good, presumably will be able to hold that provision. But great change is going on in the community, and this recognises some of the change.
Baroness Seear: What are the criteria of goodness in such circumstances? How are they to be judged and by whom? What are the qualifications for judging of the people who will make the judgments?
Baroness Denton of Wakefield: Those are some of the issues which the amendments will bring forth in our corning debate.
Baroness Lockwood: The Minister has not answered the questions which my noble friend Lady David asked. She has not in any way demonstrated how the Government, through this clause, will provide a better service than the one that is already provided by local education authorities, very often in co-operation with TECs and other organisations. The local authorities are by no means taking exception to co-operating with other bodies. Surely a competitive market determined by the Secretary of State will not be able to provide a local service meeting local needs or being accessible to local people. Accessibility is very important. I do not think that the Minister has justified the alteration to the present situation which the Bill now proposes.
Lord Stoddart of Swindon: Before the noble Baroness replies, she has not properly answered the questions put to her by the noble Baroness, Lady Seear. What criterion will be used to judge the competitive tenders? The mind boggles at competitive tenders for this sort of work. Will they have performance standards; will there be quality
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standards; or is it just to be a question of the lowest bidder? Or perhaps the Government will make a charge; perhaps they will make it the highest bidder. We need answers to those questions, and I hope that the noble Baroness will give them.
Lord McCarthy: In that context, is it not true to say that one will read the Bill in vain, and will look in vain for a schedule to find anything at all about standards and quality, or any guidance whatsoever. We all depend upon what the Secretary of State does.
11 p.m.
Baroness Denton of Wakefield: At the heart of this strategy is the duty on the Secretary of State, who is answerable to Parliament. The Secretary of State will have to be confident and able to demonstrate that the services she will have a duty to secure are meeting the obligations. In order to do that, she will have to set clear standards, monitor performance and audit and inspect overall arrangements.
I appreciate the concern of all sides about the need to uphold quality. The quality of services will be ensured through a comprehensive quality assurance strategy. Securing the provision of services through contracts requires considerable precision in specifying the purpose of services, the results to be achieved and the standards against which performance is to be measured. In turn it will require greater discipline in administration and management of services.
Work is already in hand to establish a new careers service standards, future funding and audit arrangements. They are not being developed in isolation. They are the subject of extensive consultation with providers and stakeholders and they will be extensively piloted and tested.
Baroness David: I thank my noble friends who have supported the amendment. It is quite clear from the answers, which I consider entirely unsatisfactory, that the Government do not have a clear plan to work on. The careers service is a relatively small service. There are under 4,000 careers officers in the country. Who will do the bidding for what? It is totally incomprehensible. What is going to happen?
I do not intend to divide the Committee at this time of night, though I feel very much inclined to do so. I shall read what has been said tonight, but I do not think that I shall make much sense out of it. We shall certainly come back to this issue at Report stage. For now, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 241 had been withdrawn from the Marshalled List.]
Lord Swinfen Lord Swinfen moved Amendment No. 242:
Page 53, line 14, at end insert:
("() In exercising his functions under subsection (1) the Secretary of State shall have regard to the requirements of disabled persons or persons having learning difficulties.").
The noble Lord said: In moving this amendment I shall speak also to Amendments Nos. 243 and 256. The first two amendments are designed to place a duty on the Secretary of State to ensure that people with disabilities or learning difficulties receive appropriate careers guidance. Amendment No. 256 aims to ensure

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that the careers staff who give that guidance have the appropriate skills and training. This follows the precedent set in Section 4 of the Further and Higher Education Act 1992, which places a similar duty on the new further education funding council.
This group of amendments will ensure that deaf and deaf-blind people get the communication support that they need, and that careers service officers understand the needs of blind and partially sighted people and the problems faced by those with physical disabilities or learning difficulties.
Of those leaving school each year only a few need specialist help. For example, I understand that in Surrey there are about 6,500 pupils in year 11 and of those only 200 to 300 will need the services of a specialist officer. Services winning contracts may be tempted on financial grounds to ignore the way in which specialist training and support might benefit those clients. People with disabilities or learning difficulties will lose out if inappropriate placements are made and the cost will then be borne not only by them but also by local education authorities, social services departments, further education colleges and, eventually, the taxpayer, who funds welfare benefits to those not given a chance to develop their full potential to live and work independently.
Perhaps I may give an illustration. Christopher and Jonathan took their GCSEs last year. Both have muscular dystrophy. They are in wheelchairs and need round the clock assistance. Christopher is very severely disabled. Both want to take B.Tec firsts, but no local college could cater for their needs. An out-county residential placement at a specialist college was estimated at £27,000 a year for each student and was not favoured by the parents. Because of their condition, the young men have a shortened life expectancy.
The specialist careers officer knew that students in higher education with care needs could use community service volunteers. Under the community service volunteers independent living scheme, he liaised with the community service volunteers, the local college and the director of education and social services to set up a scheme for each of his clients. Both are now living at home taking qualifications at a local college with the help of their community service volunteer. The cost of each student to the local authority is just £6,500 per year.
The specialist careers officer arranged a placement to meet the aspirations of his clients and their parents' wishes, and gained value for money. He had the specialist understanding of his clients' needs; the specialist knowledge of available provision, and the expertise in working with other specialised agencies. I beg to move.
Baroness Darcy (de Knayth): I too would like to support the amendments, briefly but warmly, as does my noble friend Lord Rix, who has had to leave to honour a previous commitment.
The Government made welcome promises in the other place to issue guidance and to consult disability organisations over the preparation of guidance. But, as the noble Lord, Lord Swinfen said, we need specific mention on the face of the Bill. Not all school leavers
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with disabilities and learning difficulties need specialist careers advice, but for some it is crucial if they are to succeed beyond school. It is precisely because we are dealing with a small group that it is important that they are not overlooked.
In the long run better careers advice means that more people with disabilities and learning difficulties will succeed in finding jobs, though it can be more expensive to provide a specialist service. As the noble Lord, Lord Swinfen, said, some of those bidding for contracts may be tempted not to provide specialist careers advice and the amendments would ensure that they do.
There is a precedent for the first two amendments in the Education Reform Act 1988 and the Further and Higher Education Act 1992, where specific duty to have regard has been acknowledged by disability organisations to have been both useful and effective. SKILL—which is the National Association for Students with Disabilities, of which I have the honour to be the president—believes that those transferring from education to employment are even more in need at this stage of specialist support.
The first two amendments should appeal to government. Whenever they oppose antidiscrimination legislation they have said very firmly that they prefer to tackle the problem piecemeal with carefully targeted legislation. So specific mention on the face of the Bill of people with disabilities and learning difficulties would help this piece of legislation to find its mark.
Lord McCarthy: We should perhaps emphasise the mildness of these three amendments. As has been said, the key amendment is Amendment No. 242, which states:
"In exercising his functions under subsection (1) the Secretary of State shall have regard to the requirements of disabled persons or persons having learning difficulties".
The noble Baroness or the noble Lord may say, "Well, they would do that, wouldn't they?" But as has been said by the previous speaker, there are precedents for having provisions of this kind on the face of the Bill. They have been found to be reassuring and it is a modest request.
Amendment No. 243 merely defines, for the purpose of the section, what a disabled person shall be. I do not see how the Government can possible lake exception to that. Amendment No. 256 merely asks to make arrangements to,
"secure the services of appropriately qualified specialist staff".
In each amendment the Government could say, "They are all unnecessary. Of course we will do all of them". But we know that there is considerable anxiety in the field that the officers at the moment are not sufficiently trained in specialist skills; there is anxiety also in regard to charges. There is considerable anxiety over a wide field and by accepting the three modest amendments, the Government could do something to mitigate that anxiety.
Lord Renton: I too support the amendments. I wish to make only one small point on Amendment No. 242. Instead of the words,
"disabled persons or persons having learning difficulties",
the provision should read,

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"disabled persons and persons having learning difficulties".
That can easily be adjusted.
When one is trying to create a public obligation to be carried out by a Minister of the Crown it is generally understood that express words, not merely implied words, are needed in the statute. If one wants to ensure that disabled people and those with learning difficulties are to have the benefit of these provisions I suggest that they be expressly referred to and the matter cannot merely be governed by inference.
I should like to mention briefly Amendment No.256. It is quite clear that if that work for such people is to be properly done it will have to be carried out by properly qualified staff. That is another matter where one should aim for certainty. I hope that my noble friend will accept these amendments or something on these lines.
Lord Swinfen: I should like to reassure my noble friend Lord Renton. If the Committee accepts these amendments I undertake to bring forward an amendment at Report stage to change the word "or" to "and".
Baroness David: I strongly support these amendments. I believe that what we all fear is that when there is competitive tendering there will not be the same enthusiasm for having careers staff with specialist knowledge to look after the disabled and those with learning difficulties. It is very important that these amendments are in the Bill.
Baroness Denton of Wakefield: My noble friends Lord Swinfen and Lord Renton, the noble Baroness, Lady Darcy (de Knayth), and the noble Baroness and noble Lord on the opposite Benches rightly stressed the importance of this area. I believe it is essential that unanimity is achieved by handling these matters through the arrangements that the Secretary of State will make with providers and the guidance that she will issue. It is important that the youngsters to whom my noble friend Lord Swinfen refers have the same expectations wherever they are in the country.
There is already in new Section 8(1) a duty on the Secretary of State to secure provision of relevant services for helping people decide for what employments they are suitable, having regard to their capabilities. The focus and starting point from which services are provided is what people are capable of. That means it will be the Secretary of State's duty to ensure that the careers guidance and employment services offered by careers services will give proper regard to each individual's capabilities. The purpose of the legislation is to provide the overarching management framework within which careers services operate. The detailed prescription of services that is sought through these amendments is much more appropriate to the arrangements that the Secretary of State will make with providers, in particular to the guidance of a general character that she will issue which, since this is part of the arrangements, will be binding on them. That is how such matters are dealt with now and it is appropriate for them to be dealt with that way in future.
In making such arrangements the Secretary of State
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will need to be clear that her duty to able-bodied, disabled and those with learning difficulties is met. She will need to know that those with whom she makes arrangements (or directs) can and will fulfil that duty. This means that she will need to be satisfied that future providers have staff with the right skills and knowledge to meet the requirements of all clients. In particular, staff will need to understand how an individual's capabilities relate to his or her disabilities or learning difficulties. It also means that the Secretary of State will have to ask for information so that she can be sure that the duty is being fulfilled. This requirement will be spelled out in the guidance of a general character and the contract or directions.
Careers services have a long tradition of providing particular help to those who are either disabled or have learning difficulties and we intend to ensure that the tradition continues. I am happy to reiterate my assurance that we intend to include details in the guidance of a general character on how careers services will meet the guidance and employment service needs of those with disabilities. We shall be consulting widely in drawing up the guidance, in particular with those groups which represent the interests of those with disabilities and learning difficulties.
I hope that that assurance, which I gladly give, to see to it that in making arrangements the Secretary of State will note all the extremely important points that have been made this evening, will allow the noble Lord to withdraw the amendment.
Baroness Seear: One gets more and more alarmed at the idea that all wisdom is in the heads of the Secretary of State and her civil servants. How many of them have ever dealt with problems of this kind? We shall be advised by bureaucrats with no experience of this kind of thing. They will consult but they will judge. Why does the noble Baroness think that one will get a better result in this way than from local education committees, many of which have people of considerable experience, in close touch with the problems and answerable locally if things go wrong? We are told again and again that we should leave it to the centre. If we do that, we leave it to civil servants with no direct experience whatever.
11.15 p.m.
Lord Renton: Before my noble friend replies, I wonder whether she will bear in mind that the Minister in another place pointed out in Committee on 2nd February at col. 708 of the Official Report that there is standard guidance at present in advising people in these circumstances. However, he had to confess that there are wide variations in performance. Merely to repeat the present guidance and hope for the best does not seem to be enough. Therefore, I would suggest that something on the lines of the amendments could do no harm and indeed might ensure that the purpose that we all have in mind is achieved.
Baroness Denton of Wakefield: Perhaps I may reply to my noble friend Lord Renton first. I mentioned in my earlier remarks that the advantage of the Secretary

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of State being responsible is that there will be a uniformity and not the wide variations. The purpose of the legislation is to provide the overarching management framework within which the careers service operates. I say to the noble Baroness, Lady Seear, that it is not our intention to consult with the people who understand these matters and then ignore advice. There would be no point in consulting if that were the point. Perhaps I may also clarify that the Secretary of State sets the standards for the careers service. The standards are not set by local education authorities.
Lord Swinfen: I thank those who have taken part in the debate and also my noble friend the Minister. She has throughout her responses emphasised the fact that it is the Secretary of State who is responsible at the moment. If she re-reads the amendments she will see that the amendments make the Secretary of State responsible as well. It is a question of ensuring that it is the law that the Secretary of State should take these matters into account.
I do not really believe that the guidelines which my noble friend suggests will be made will be adequate, because without the law to back them up, they will not be carried out, as they are not carried out today. Will my noble friend give an undertaking either to look at this matter again between now and Report stage or possibly to meet me and representatives of some of the organisations for the disabled to discuss the matter? I am not satisfied with the answer that I have been given. If it were earlier in the day I should divide the Committee, but I shall not at this hour of the night because it will delay matters even further.
Baroness Denton of Wakefield: Before my noble friend sits down, shall be very happy to meet with him and some of the organisations concerned. I believe the fact that the matters will be in the contract or the directions for the organisation and the Secretary of State will have to ask for information to make sure that the requirements are being fulfilled, will give protection.
Lord Swinfen: I always wonder whether it is possible to enforce a contract. But I shall not go into that now. I am delighted that my noble friend has agreed to meet me between now and the next stage of the Bill. Under those circumstances I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 243 not moved.]
Baroness David Baroness David moved Amendment No. 244:
Page 53, line 49, at end insert:
("(5) Any educational institution of the type referred to in subsection (3) of this section which is a further education corporation, a school maintained by a local education authority or education authority, a grant maintained school, a city technology college or an independent school admitting pupils under the assisted places scheme shall afford such reasonable access to persons appointed to provide services of the soil described in subsections (1) and (2) of this section as is necessary for the effective delivery of those services, provided that due notice is given of the need for access and that there is consultation about the arrangements for access.").
The noble Baroness said: In moving this amendment, I wish to speak also to Amendment No. 264. The purpose of Amendment No. 244 is to ensure that the provider of the service has access to the relevant educational establishments. Amendment No. 264 is to highlight the potential weakening of links between careers education in schools and any future guidance service. The careers service has to work through schools and colleges to make contact with the young people it serves. Good practice requires an effective agreement between the service and the school about the arrangements for access, the passage of information about individuals and the links between careers guidance and careers education within the institution.
However, from time to time isolated problems can occur which threaten such co-operation. An example might be where a school competing with other institutions for students is anxious to retain as many as possible in its sixth form and is concerned that guidance might encourage some to consider transferring to an FE college or seeking employment-based training.
While the main thrust of this amendment is to ensure that young people in educational institutions are given access to the careers service and to put beyond doubt the duty of the institutions to co-operate with the careers service in facilitating this, it may also be worth mentioning that the amendment should help to underpin the necessary liaison and co-operation to ensure that careers education in schools and colleges is integrated with the guidance provided by the careers service. It is important to remember that effective careers guidance will depend on effective careers education having paved the way for it. I beg to move.
Baroness Denton of Wakefield: The noble Baroness, Lady David, suggests in Amendment No. 244 that careers services should have a statutory right of access to schools and colleges, perhaps because LEAs will no, longer have the duty to provide services and will therefore not be in a position to secure access for careers service personnel. Possibly in future it may be that schools will attempt to bias the information which pupils receive and that they will attempt to encourage them to stay on at school rather than consider what might be more appropriate alternatives.
The record of the local education authorities in enabling careers services to have access to all schools has not been entirely satisfactory. There have been instances where LEAs have tried to prevent or discourage careers services from providing services to City Technology Colleges, grant-maintained and independent schools. Their pupils have a right to the advice of careers services.
There have been instances of less than perfect access being offered. There is no statutory right of access at present. In spite of this, or perhaps because of it, the careers service is welcome in the overwhelming majority of schools including a substantial proportion of schools in the independent sector. The amendment appears to suggest that headteachers, teachers and governors cannot be trusted to make the best careers education and

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guidance arrangements for young people in their care. Anecdotal examples of that appear to be isolated incidents. A recent survey by the careers service inspectorate found no evidence that this was happening any more frequently now than in the past.
There is much stronger evidence to suggest that careers services are welcome in schools and that there is generally a good working relationship between schools and careers services. We want to ensure that that continues. Giving careers services a statutory right of access to schools—a power only given to HMI at present—could well be damaging to this relationship.
Turning to Amendment No. 264, we believe that the importance of a close working relationship will continue to be necessary to the effective provision of careers advice. Careers education is a cross-curricular theme within the national curriculum. At national level, it is therefore the responsibility of the Secretary of State for Education with advice from the National Curriculum Council. Consultation and co-operation between the two departments responsible for careers education and the careers service on these matters is well established. There is no need to impose a duty on the Secretary of State for this to continue.
The authority responsible for the provision of careers education in each school is the school governing body. It would be impractical to place a duty on the Secretary of State to ensure that the provision of careers services was planned at local level in consultation with the governing bodies of each school.
I do not wish to reject the intention behind the amendment and therefore we will be providing both strong encouragement and formal guidance which will ensure that the close working together between schools and careers services which characterises best practice will continue and develop. I hope that that reassures the noble Baroness.
Baroness David: I thank the Minister for her reply. As I have been surprised by some of her comments, I should like to take advice before deciding whether to bring these amendments back on Report. They have given me the opportunity to question the wisdom of splitting the careers service from the education service. The 1973 Act was universally welcomed because it recognised that the careers service was part of the wider education service. As I said, I shall take advice but, for the moment, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Lord Skelmersdale): I understand that Amendments Nos. 244A to 255 have been mis-attributed on the Marshalled List. Therefore, I shall call the noble Baroness, Lady David, to move Amendment No. 244A.
Baroness David: No. I should perhaps explain that this is something to do with the printing. Amendment
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No. 244A belongs to my noble friend Lord Stoddart, but Amendments Nos. 245 through to 255 belong to me.
The Deputy Chairman of Committees: In that case, I call the noble Lord, Lord Stoddart of Swindon, to move Amendment No. 244A.
Lord Stoddart of Swindon Lord Stoddart of Swindon moved Amendment No. 244A:
Page 53, line 49, at end insert:
("() It shall be the duty of the Secretary of State to ensure that those appointed to administer the arrangements made under this section hold the Diploma in Careers Guidance or a recognised equivalent.").

The noble Lord said: Perhaps I should say at this stage that I act as an adviser to the National Association of Local Government Officers. It is vital that properly trained people continue to deliver these services and it is by no means certain, under the Bill, that that will be so. There is a danger that the service will be fragmented in such a way as to ensure that it becomes unrecognisable as a careers guidance service, staffed by people who have no background or experience and who lack a properly recognised national qualification. Until now, the service has been staffed by experienced and motivated people, many of whom hold the Diploma in Careers Guidance, a qualification recognised by the Local Government Management Board as the appropriate qualification for careers guidance officers.
I trust that it is the Government's wish to retain and recruit properly qualified staff. Indeed, I believe that it is essential that they should do so. Will they give the assurance that this qualification and others continue to be relevant and recognised? I beg to move.
11.30 p.m.
Baroness David: Amendment No. 258B in my name is supposed to be grouped with Amendment No. 244A. I hope that the Minister agrees with that. I believe that that was the grouping arranged. The amendment tries to achieve the same thing: to ensure that staff engaged to deliver services have the appropriate competences in accordance with agreed national standards that the Secretary of State shall approve. The amendment is designed to make it obligatory that all staff employed are competent to perform the duties necessary under the contract and that contractors employ skilled, trained and competent guidance practitioners.
The Government are committed to high quality public services. That is what the Citizen's Charter is all about. Quality requires standards, and those providing services must meet such standards. The Bill is about the change in control and management of the service. It should not water down, or diminish in any way, the entitlement of clients to careers guidance of quality.
The needs of clients vary according to their own circumstances, whether, for example, having high academic ability or special needs. There are important issues to address, such as gender and race, which

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require a wide range of skills, training and competences in staff. All of that must be secured through specialist training.
Baroness Seear: If she looks back into the history of the battle—that is what it was—between the Department of Education, local education authorities and the Ministry of Labour, as it then was, the noble Baroness will find that the people employed by the Ministry of Labour to do the work did not aspire to qualifications. That is one of the reasons why many of us were extremely glad when the service went to the local education authorities. They put emphasis on qualifications, something which had been noticeably absent when it had been in the hands of the Department of Employment.
Baroness Denton of Wakefield: I take note of the remarks of the noble Baroness, Lady Seear, on the history of the matter. I shall reply first to the noble Lord, Lord Stoddart. Under Amendment No. 244A anyone who did not hold the Diploma in Careers Guidance or a recognised equivalent would be prevented from administering services. That would be extremely restrictive. It would in fact prevent some people who are currently and successfully involved in the administration of services from being so in future. It would prevent the administration of services benefiting from the additional knowledge and expertise that people with professional qualifications in fields other than careers guidance might bring.
We want to widen, not narrow, the base of expertise and knowledge that is brought to bear on the operation of careers services. That is why we have provided a power for services to be run as joint ventures.
Let me reassure the noble Lord that when making the arrangements the Secretary of State will have to be satisfied that whoever she contracts with has sufficient expertise to provide the service that she has a duty to secure. That includes sufficient professional competence in the field of careers guidance.
The amendment tabled by the noble Baroness, Lady David, appears to want the Secretary of State to set up a certification or licensing procedure for staff. That is unnecessary. Currently there is a lead body for advice, guidance and counselling, which is meeting under the auspices of the National Council for Vocational Qualifications to establish NVQs for careers guidance staff. When this process is complete, the NVQ framework should provide the necessary statements of competency and standards that will be required for work in careers services. Current careers service practitioners are fully represented on this lead body.
Surely the noble Baroness would expect the department, which established the NCVQ and introduced the Investors in People initiative, to give a high priority to ensuring that staff are properly selected, trained and professionally developed for their demanding task. There seems to have been a sea change in the Department of Employment from the Ministry of Labour.
The national standards that providers will have to achieve will be set out in the Secretary of State's
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guidance to future providers. In short, she will be expected to act reasonably and responsibly in determining who is competent whether or not such an amendment as is before us is contained in the Act.
The Secretary of State can only make arrangements with people who are competent to provide the services she has a duty to secure. These providers will have to demonstrate their competence through the proposals they will make, which will be judged against the criteria that the Secretary of State will establish. I suggest therefore that the amendments are not necessary.
Lord Stoddart of Swindon: I listened carefully to what the noble Baroness said. Of course, she was right in saying that many people employed in the careers advisory service are dedicated and hardworking and they do not have professional qualifications. Nevertheless, I am anxious, as are the people in the service, that standards do not drop. The service should be under the leadership of properly-qualified people; they should have the recognised and relevant qualifications.
The noble Baroness gave some comfort that her department and the Secretary of State will continue to ensure that the people employed in the careers service are not only dedicated but under properly qualified leadership. I shall read carefully what she said in Hansard; but with that assurance, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 245 to 248 not moved.]
Baroness David Baroness David moved Amendment. No. 249:
Page 54, line 20, leave out ("or").
The noble Baroness said: In moving the amendment, I shall speak also to Amendment No. 251. Amendment No. 249 is a probing amendment to ensure that the current arrangements where authorities provide a joint service can continue under the Act. The amendment attempts to clarify a position, which does not emerge unambiguously by the current wording of the proposed new Sections 10(1) (a) and 10(1) (c), by adding a further subsection, 10(1) (d).
New Section 10(1) (a) implies the Secretary of State making arrangements with education authorities singly. New Section 10(1) (c) implies that joint arrangements should involve "persons of any other description". The proposed new Section 10(1) (d) would allow the Secretary of State to make arrangements with two or more education authorities acting jointly. That seems a sensible further choice as there are currently arrangements where co-operative activities between education authorities are operating with the support of the Department of Employment. The best example of inter-authority co-operation has been the London Central Careers Unit, LCCU, which is provided and managed by the Corporation of London on behalf of a consortium of 34 London boroughs and contiguous county authorities. It has the active support of the Department of Employment and fulfils guidance given by a previous Secretary of State, Mr. Norman Fowler. It works with individual

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TECs on specific projects but its advantage is that it can offer an objective approach across a metropolitan area which is wider than a single TEC boundary.
However, that is stated only by way of example. The need for a co-ordinated approach to central London has been continually re-emphasised and the arguments for it have not changed since its inception in 1980. Indeed, the need for that arrangement to remain stable while the adjustments to more parochial arrangements are carried through can be clearly seen to be of advantage both to employers in central London and all young people in London and the South-East.
That looks as though it can be covered by the existing proposed provision in Section 10(1) (a). A joint operation between LEAs and the careers service can offer a number of advantages: stronger relationships with employers achieved through the concentration of resources for employer contact and liaison; rationalisation of other specialist expertise; constantly up-dated data on current vacancies across a whole area; provide for a given area on a coherent, co-ordinated basis in advance of a relevant partnership emerging or, if other alternative arrangements do not emerge, can offer the opportunity of reduced unit costs. I beg to move.
Baroness Denton of Wakefield: The noble Baroness said that this is a probing amendment. I hope to be able to reassure her. The Secretary of State is already able to make arrangements with local education authorities acting jointly under the proposed legislation which makes the amendment unnecessary. Section 10(1) (a) enables the Secretary of State to perform the duty imposed by Section 8 by making arrangements with local education authorities. Such arrangements would be voluntary on both sides. The Secretary of State would not be required to enter into arrangements with any particular authority in relation to any area. Also, a local education authority would be free to enter into arrangements or decline to do so. Consequently—and I hope that this will reassure the noble Baroness—the Secretary of State would be able to make arrangements with two or more authorities acting jointly. Therefore, the arrangements to which the noble Baroness referred would not be put at risk by this legislation.
Baroness David: I thank the noble Baroness for her reply which gives me some reassurance. I shall read it with care and, in the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 250 and 251 not moved.]
[Amendment No. 252 had been withdrawn from the Marshalled List.]
Baroness David Baroness David moved Amendment No. 252A:
Page 54, line 26, at end insert:
("provided that the Secretary of State has satisfied himself as to the local acceptability of the proposed arrangements and the suitability of persons party to the arrangements.").
The noble Baroness said: The purpose of the amendment is to ensure both local acceptability and accountability of the new careers services. This is an important amendment.
As regards acceptability, in order that the new careers services are able to operate effectively, they must be acceptable to the local stakeholders, which include TECs, LEAs, employers, schools, colleges and parents, as well as to their various individual clients —those in need of careers information or guidance and placing.
Careers guidance does not exist in a vacuum. Effective careers guidance is a process that depends upon the complementary roles of those whom I have just mentioned. In order to have accountability, it is important that the new owners or contractors are demonstrably accountable to the major stakeholders as well as to the individual consumers. Therefore, the new owners should involve representatives of the business, education and local communities through whom consumers will be able to hold careers services to account.
I have no doubt of the overriding considerations for acceptability and accountability. Those have been well argued by the nation's largest professional association for careers guidance practitioners—the Institute of Careers Guidance. It is widely supported across the education and business sectors. The institute argues that the new careers services must be impartial and client-centred; unbiased and without pressure from opportunity planners and providers; take full account of factors affecting labour markets; be equally accessible to all clients; promote equality of opportunity and be delivered by skilled careers guidance staff who follow a nationally agreed code of practice. This amendment will ensure local acceptability and accountability. I hope that it will be acceptable to the Minister. I beg to move.
11.45 p.m.
Lord McCarthy: This is another extremely modest amendment. The Government say they want to break up the local authority monopoly and pass that monopoly over to the Secretary of State. What this amendment suggests is that the Secretary of State, in carrying out his monopoly, should be under an obligation on the face of the Bill to do something about the,
"acceptability of the proposed arrangements".
I do not see why the Government should object to this. I remind them that the provision on the face of the Bill —looking at it from the point of view of those who are involved in the service already—looks rather delphic, rather mysterious and rather worrying. The Secretary of State may make arrangements not only with local education authorities, or in Scotland with education authorities, but with,
"persons of any other description".
Who is a person of any other description? Any person could be a person of any other description, because any person could fit any other description. We are talking merely about a person. What we are saying is that, before these persons of any other description or no description come in, we should have something on

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the face of the Bill saying that the Secretary of State who inherits a monopoly has to satisfy people locally on the acceptability of such a person.
Baroness Denton of Wakefield: I am not aware that I said the aim was to break up the local authority monopoly. The aim is to ensure that the high standards achieved by the best are available everywhere, and indeed are improved upon. The Secretary of State will have a duty to secure a continuous national service to national standards. She cannot leave the fulfilment of her duty entirely to the people in each locality. She will nevertheless have to be absolutely satisfied that the proposed providers of careers services have sufficient standing with, and support from, key stakeholders in the local community to give her confidence that the services which she has a duty to secure will be provided.
As I suggested in my earlier remarks, an important advantage of the new arrangements is that they will enable careers services to be provided as joint ventures between education and employment sectors and therefore increase mutual understanding and a significant degree of consensus on aims and intents. It is absolutely crucial that this is obtained and it will therefore be one of the aspects of the services around which criteria will have to be established for judging the quality of bids. I hope that that will enable the noble Baroness to reconsider her amendment.
Baroness Seear: As regards the term,
"persons of any other description",
who is ruled out under that heading? Who is not a person "of any other description"? As the Bill stands, that term could refer to absolutely anyone. Who is excluded?
Baroness Denton of Wakefield: I would suggest that those people who are excluded are those who are not able to measure up to the standards required by the Secretary of State.
Lord McCarthy: Is a person "of any other description" a stakeholder? If we do not know who,
"persons of any other description",
are, who are stakeholders? In the world of industrial sociology, stakeholders are employers and trade unions, The Government do not intend to refer to them. The term provides for all kinds of people. Who are stakeholders? That is a new term at this stage.
Baroness Denton of Wakefield: Stakeholders are, I suggest, those members of the local community who will enable the service to be administered and to be effectively operated within the community.
Baroness Seear: Are they not also the receivers? In the world of industrial sociology, they are very much the people who are on the receiving end as well. They are the consumers. I thought we were awfully keen on consumers these days. Are they not among the people of "any other description"?
Lord Hacking: I intervene as a lawyer and not as a sociologist. Stakeholders are the holders of money.
Lord McCarthy: Does the noble Baroness mean the holders of money? Are they the stakeholders?
Baroness Lockwood: I turn to another point. The Minister said that part of the criteria the Secretary of State would apply is that she would have to be satisfied about the local acceptability of the scheme, whoever the stakeholders were and whoever was involved. Will the criteria be published and made available? If they are not, how will the users and providers of the service know what criteria are being employed? Would not the amendment ensure at least that part of the criteria were clearly established in the Bill?
Baroness Denton of Wakefield: To reply to the noble Baroness, Lady Seear, of course the consumer is a crucial part of any arrangement. The arrangement of the careers service is import ant for the future of young people.
Other stakeholders, not strictly by the lawyer's definition, could be training providers, schools, colleges and other people who are involved in ensuring that the careers service offers the best to children. The Secretary of State has to set clear standards and criteria. Work is already in hand to establish these. Of course they have to be known to the parties who 'will be measured by them, otherwise it would be impossible for them to achieve the necessary performance.
Baroness David: According to my brief, stakeholders include TECs, LEAs, employers, schools, colleges and parents as well as the various individual clients, those in need of careers information, guidance and placing, for what that is worth.
Lord Hacking: That goes well beyond my legal dictionary.
Baroness David: We should set up mechanisms with local flexibility, allowing local people to decide what is best for them, within which we are sure that each local community is able to influence the strategic policies and priorities of their new local careers service. I do not believe, from what the Minister said, that we have that. Yet again I shall have to read what the Minister said and decide whether it is sufficiently satisfactory for me not to have to return to the matter at Report stage. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 253 to 256 not moved.]
Baroness David Baroness David moved Amendment No. 257:
Page 54, line 46, at end insert, ("and the Secretary of State shall publish annually details of any such payments which he has made or proposes to make during the year together with information on how the payments have been calculated.").
The noble Baroness said: The purpose of the amendment is to allow accountability and debate on the funding arrangements for the careers service. At present the careers service is funded by LEAs with some additional direct grant from the Employment Department calculated to take account of local labour market difficulties. Its budget will be publicly debated with the budget of the authority and open to public scrutiny. It would be regrettable if the change to direct central funding of the service was to lead to less openness about the funding. The basis on which

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funding is calculated should be made clear publicly and should be known to local careers services in order to demonstrate equity in the arrangements and to make clear how the funding relates to the task expected of the service.
There are particular worries at the point of transfer when the legislation is implemented and direct responsibility for funding passes from the LEAs to the Secretary of State. LEAs fear that the Secretary of State may remove from their expenditure settlement more than is actually spent on the careers service in order to ease the task of setting up the new arrangements. That is based on the experience of the transfer of FE colleges and grant-maintained schools.
In short, the Bill simply gives the Secretary of State the power to fund the service. It is vital that there should be clarity about the funding arrangements, including the transfer of funds from the LEAs to the Secretary of State, if there is to be an orderly transition to the new arrangements and a realistic prospect of local planning for the future of the service. I beg to move.
Baroness Denton of Wakefield: The noble Baroness is absolutely right. There must be an orderly transfer. There is already a procedure for publishing information on expenditure plans for careers services.
Each year the Secretary of State for Employment presents to Parliament jointly with the Chief Secretary to the Treasury a report which sets out objectives and expenditure plans for the next three years. This already covers the department's work with respect to the careers service and it can continue to do so. Similar arrangements exist in Wales and Scotland. I hope that that satisfies the purpose of the first part of the noble Baroness's amendment.
As for the second part, which would require the publication of information on how payments to careers services are calculated, it will not be possible for me to be as helpful. During the early stages of implementing the legislation the calculations for funding services will rely heavily on historical data: that is inevitable. We shall therefore be consulting with, and requesting information from, current providers and others involved in order to establish the initial funding arrangements.
Further down the road of implementation the funding of services will result from a process of bidding and negotiation. Under those circumstances it would be proper to treat information on how the payments have been calculated as confidential. It will, however, be possible to make known the criteria by which funding will be proposed and bids judged.
On the national level, there is no change to the current and planned expenditure for the careers service. That is as far as it is possible to go on those matters. Perhaps the noble Baroness will reconsider the position.
Baroness David: I wish to consult some of the local authority associations to find out how satisfied they are with that response. It does not seem an entirely
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open affair. The issue will not be totally known. The Minister stated that some part of it will be a matter for confidentiality.
Perhaps I may ask a probing question. How far will the funding continue to be available for careers service functions which go beyond the minimum statutory requirements of the new Section 8 of the 1973 Act? For instance, how will adult guidance be funded? That has been part of LEA responsibility until now.
Baroness Denton of Wakefield: I cannot directly answer that question. I shall find the answer and let the noble Baroness have the information.
Baroness David: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Stoddart of Swindon Lord Stoddart of Swindon moved Amendment No. 257A:
Page 55, leave out lines 1 to 5.
The noble Lord said: The intention of the amendment is to remove the power to make charges for services provided under new Section 9. We need an explanation of what the Government have in mind both in relation to services to be charged for, and the level of such charges.
As I understand it, the legislation ensures that the statutory client group will continue to receive free careers guidance. But it will limit such services to those who are still in education or who have just left it. However, statutory provision could be interpreted in a narrow minimalist way which might enable the new providers to charge for any additional services. That could hurt people with special needs. For example, as the noble Lord, Lord Swinfen, mentioned when moving an earlier amendment, there are people with disabilities and learning difficulties. There are also young offenders and other groups needing special treatment. Furthermore, many authorities have developed services for the adult unemployed; and at a time when we have 3 million people unemployed, and rising, it is essential that such services are maintained.
Will the noble Baroness state the exact scale of charges which she is considering? We need the assurance that charging will not reduce the quality or quantity of services available.
The Chairman of Committees: I remind the Committee that if the amendment is agreed to, I shall be unable to call Amendment No. 258.
Midnight
Baroness Denton of Wakefield: So as to avoid misunderstanding, let me make it clear at the outset that the core service, as defined in Section 8 regarding the new duty on the Secretary of State, will remain free of charge.
What we seek to do in the new Section 10(5) is to enable careers service providers to make charges under the powers that my right honourable friend the Secretary of State will have under Section 9. That means that, where it is specified in the arrangements or directions, providers may charge for services other than those provided to the statutory client group.

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At present the local authority providers have only a very limited scope for charging of this kind. Many careers services are currently making use of these very limited powers with some success. We want to provide them with greater freedom so that they can develop and extend their services through charging, if there is the demand.
It will, for example, give them greater freedom to develop an all-age guidance service, or perhaps advisory services for employers. It will also ensure that careers services can continue to be fully involved in government proposals for developing guidance services for adults through the gateways to learning and assessment and guidance credits initiatives.
If this amendment were to be adopted, we would be taking away this added flexibility and freedom for providers. It is vital that a comprehensive guidance service is available to all young people at key decision points in their lives—for example, as they first enter the labour market. The Government also recognise that certain other groups—for example, young people leaving school—should have free access to guidance and employment services. The new legislation re-emphasises the delivery of a free service to the core group.
Why should not adults be expected to pay for a service that has the potential to enhance both their job satisfaction and earning potential? The power to charge does not mean that the extensive range of guidance and employment services available to unemployed adults will now be subject to charges. It does not mean that guidance services of the kind currently provided by the local education authorities will come to an end. They are allowed for in the legislation.
This section or the new legislation will enable greater freedom in the area of charging. However, the power to charge does not mean that the extensive range of guidance and employment services available now, in particular to unemployed adults, will be subject to charges.
On the issue of charging, as regards people with disabilities or learning difficulties, those who are in the core client group covered by the current legislation will continue to be there. The core client group will include young people who have ceased to undergo education and who, because of their disability, are experiencing an extended transition to settled employment. The Secretary of State's duty is determined in that instance by individual circumstances.
Baroness Seear: I am sure that the noble Baroness means every word that she says and I am prepared to believe that so long as this Government are in power they will not start charging for services which she says will continue to be free. But as the Bill stands, there is nothing to stop people later introducing charges for the whole range of services. Could not something be written into the Bill to safeguard against that? I am sure that the noble Baroness does not mean that charges should be introduced, but they could be. We would be much more comfortable if there were something in the Bill that made it impossible.
Lord McCarthy: Before the noble Baroness answers that, could she do so the other way round? I tried to write down what she said: not the unemployed, not the disabled, not young people and not a vague group—the "core" group, whatever that is, and other unnamed persons.
Perhaps it would be easier if the noble Baroness could say who will be charged. Who are the people who might be charged? Presumably it will be those who are not part of the core group?
Baroness Denton of Wakefield: I hope that the legislation will give freedom to those providers of the services, free to the groups I have mentioned, to develop marketable services under which people will wish to pay for advice outside those areas where the Government provide the service free of charge.
Baroness Seear: Will the noble Baroness consider between now and the next stage whether there is any way in which we can be reassured that those charges cannot be made? I know about the intention. But the legislation gives no assurance. Can the Government think of a form of words which will satisfy us on that matter?
Baroness Denton of Wakefield: I say to the noble Baroness that I will take away her words and bear them in mind.
Lord Stoddart of Swindon: I am afraid that I am not satisfied with what I have heard. It is too late to put the matter to a vote tonight.
Noble Lords: Why?
Lord Stoddart of Swindon: I think perhaps we had better get on, so I shall not put the Committee to the trouble of a Division. I am not satisfied with whal the noble Baroness said. She reassured the Committee about the statutory client group. That includes the core people who are disabled. But what about people outside the core group? What about the disabled outside the statutory group? I shall have to look very carefully at what the Minister said. I have the impression that disabled people not covered within the statutory arrangements could very well be charged. I hope that that is wrong. I shall have to look at what she said.
The Minister did not answer the question of my noble friend Lord McCarthy. Would it not be easier if the Government told us what groups are likely to be charged, and what services will be charged for? The Government must have something in mind; otherwise they would not have included the provision in the Bill.
Baroness Seear: Not necessarily.
Lord Stoddart of Swindon: We know that the Government do all sorts of quaint things. But they must have the intention to charge certain groups. There is no question that they want to make money. I am sure that we are all suspicious of what the Government are doing. Before we reach Report stage, perhaps the noble Baroness can write to us all and give us an idea. She knows who is here. There are so few of

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us that she could take our names and send us a letter to say exactly what sort of services she has in mind for charging. That would be helpful.
In withdrawing the amendment, I fear I must say that we shall probably bring it back at Report stage —unless the Minister can give some satisfactory answers in the meantime. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Swinfen Lord Swinfen moved Amendment No. 258:
Page 55, line 5, at end insert:
("(5A) Charges to individuals shall not be made under subsection (5) above, for additional provision arising directly from disability or learning difficulties.").
The noble Lord said: The first part of the Minister's response to the last amendment and the first intervention of the noble Baroness, Lady Seear, show forcefully why it is necessary that this amendment should be incorporated in the Bill.
The purpose of the amendment is to ensure that disabled adults and those with learning difficulties do not have to pay for the additional support or the more specialised careers guidance that they require as a result of their disability. The careers officer may well need to spend more time with disabled people than with others, and training or other placements may take longer to organise because of particular needs. When an individual is still in education he will not be charged for extra time and effort put in by the careers service. But the need for extra assistance does not end when the individual leaves education. That point needs to be emphasised.
As people with disabilities and learning difficulties find it more difficult to gain employment, they may need assistance from careers services for some time after they have ceased to undergo relevant education. They may be more heavily represented among any groups which require the adult guidance that the careers services provide under their powers in the Bill.
If careers services are able to charge clients for provision, many people with disabilities will find as a result that their bills are much higher than those of other clients. For example, they might be charged for the extra hours or additional communication support that they need. People with disabilities and learning difficulties, while often needing more support from careers services, are the group least able to meet the costs of additional services arising as a direct consequence of their disability. It has been proved that disabled people are likely to have less disposable income than the general population.
I do not suggest that disabled people should be exempt from all charges; rather that charges to clients should not be prohibitively high and set at such a level that careers services will be inaccessible to those who most need them. I believe that the cost of additional guidance or support arising directly as a consequence of an individual's learning difficulty or disability should not be passed on to the individual client. I beg to move.
Baroness Darcy (de Knayth): I should like extremely briefly to support the noble Lord, Lord Swinfen, who
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has so very comprehensively introduced the amendment. We are just talking about additional provision and disproportionate charging to a group of people who are perhaps most in need of extra help from the careers service and who are perhaps least able to meet the costs of that support.
I hope that I understood the Minister to say in response to the question from the noble Baroness, Lady Seear, that she would look again into the whole issue of charging or explain it. I may have been a little slow and perhaps she will clarify the position when she comes to reply.
Baroness Denton of Wakefield: Perhaps I may say to my noble friend Lord Swinfen and the noble Baroness, Lady Darcy, that we have great recognition of this issue and great concern about it. We shall certainly clarify the situation and perhaps I shall be able to assist at the meeting which I have agreed to hold with my noble friend and other interested parties on this matter. There is no question of people with disabilities or learning difficulties who are in the core client group covered by current legislation being charged for services under the proposed legislation. In addition, new providers, as now, will be able to attract funds from sources other than the Secretary of State and charge him to provide free services for those adults where the need is greatest. The legislation proposes that, with the Secretary of State's agreement, services will be able to charge for guidance services provided to people outside the statutory core client group. There is no evidence that those with disabilities are charged more by current private providers of adult guidance. I can see no reason why those with disabilities and learning difficulties should be charged more.
The Secretary of State will always be in a position to monitor and control charging. If she were to find that those with disabilities and learning difficulties were charged inappropriately, she would have the power through the arrangements or directions that she will make with the providers to rectify such situations. The power to charge does not mean that the extensive range of guidance and employment services available to unemployed adults will now be subject to charges.
I am to have a meeting with my noble friend at which I am sure this will probably be one of the matters that he will wish to discuss. I hope at this stage that he may feel able to withdraw his amendment.
Lord Swinfen: I thank my noble friend for offering to include this matter in the discussions upon which we have already agreed. I gladly accept the offer. However, administrations change, and the intention of this administration may be one thing, but the intention of another may be totally different. With those words, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 258A and 258B not moved.]
12.15 a.m.
Baroness David Baroness David moved Amendment No. 258C:
Page 55, line 18, at end insert:
(", and

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() to ensure that a written summary of careers guidance with agreed plans of action in relation to employment, education or training, is provided to all individuals receiving individual guidance from the provider of such services.").
The noble Baroness said: In moving Amendment No. 258C, I shall speak also to Amendment No. 258CA in the name of my noble friend Lord Stoddart. The amendment seeks to ensure that all clients receiving individual careers guidance receive a written agreed summary for further discussion with parents, teachers and so forth, and as a stimulus to agreed further action or self-help.
It is an important entitlement for clients. The wisdom of it was first perceived by the then Conservative Government in 1972. We would all agree that it is easy to forget things. The written summary is not only an invaluable aide memoire to the individual following his or her careers guidance interview, it is also a key tool as an aid to their subsequent discussions with other important people in their lives, be they teachers, employers, partners or parents.
For young people undertaking education, it is obvious that parents have a special interest in their future development. Independent studies have shown the importance of parents in the guidance process. Their influence on their sons' and daughters' future career plans and ultimate decisions is known to be considerable, and parents need written summaries as well as young people. I hope therefore that the amendment can be accepted by the Minister. I beg to move.
Lord Stoddart of Swindon: I support the amendment, which seems to me to be extremely reasonable. The 1973 Act contained the provision, which is repealed by this legislation, and I should have thought that the Government would want to continue it.
What my noble friend Lady David said regarding the necessity for providing such a record is extremely relevant. It is a record which can be kept over a long period of time. It will assist the people receiving advice, and certainly it will assist parents. I therefore support the amendment.
Baroness Denton of Wakefield: I support the thinking behind the amendments, but do not agree that it is a matter that needs to be a statutory responsibility within the legislation.
The legislation is there to provide the overall framework within which the service will operate. Such a level of detail, as indicated by the amendment, is better covered in the guidance of a general character which will be issued setting out the nature of the local careers services, the standards they will be expected to achieve and also in the arrangements the Secretary of State will make with careers service providers.
The intention is to build upon and encourage best practice. The current practice of proving written summaries of guidance is valuable; but they are not necessarily the outcome of offering advice and guidance in every case and on every occasion.
Section 9(3) of the current legislation states that it shall be the duty of the authority to give a written summary of any vocational advice given, but there has
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not been a commencement order for that part of the legislation. Instead, and much more to be desired, the practice has developed through those providing the careers services realising the benefits for themselves.
We do not want to dictate to providers of careers services every detail of how they should do their job. It is important that those should be developed while recognising their own skills. We believe that the provision of written summaries of guidance and careers action plans is an example of good practice, and the appropriate place for advice about such matters is the Secretary of State's guidance of a general character. In the light of those remarks, I hope that the noble Baroness will find it possible to withdraw the amendment.
Baroness David: I thank the Minister for her reply. I am reminded that the CBI in its Routes for Success published early this month spelt out the critical importance of what it called independent careers guidance leading to an up-to-date action plan based on individual guidance. For that I should have thought that one would need something in writing. I am partially reassured by the Minister but wish to read what has been said before I make up my mind. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 258CA not moved.]
Baroness David Baroness David moved Amendment No. 258D:
Page 55, line 18, at end insert:
("() The Secretary of State shall make arrangements for the inspection of services provided in accordance with this section and shall appoint persons with knowledge and experience in the fields of education, industry, commerce, careers guidance and the local community to a National Council which shall—

(a) advise him on the adequacy and the quality of the services provided in accordance with subsections (1) and (2) of this section and on matters relevant to the arrangements or directions under these sub-sections or to guidance given under subsection (6) of this section, and

(b) appoint such committees as it considers necessary and may appoint to committees persons who are not members of the Council, and

(c) publish an annual report summarising the findings of inspections and the work of the National Council.").

The noble Baroness said: The purpose of this very important amendment is to ensure that independent inspections of the performance of contractors take place and are published, together with an annual report on the national council, and to propose a national mechanism dedicated to securing quality careers guidance. This is the key to quality assurance. It provides a national framework for quality throughout Great Britain. It provides authoritative and independent advice to the Secretary of State on the strategic development and delivery of quality careers guidance and the careers service, and safeguards the interests of the consumer, that is, the clients and customers of careers guidance. In focusing upon standards, receiving all inspection reports, offering strategic leadership and national advice to Ministers and contractors, the council will be a valuable asset to government. National councils elsewhere in Europe are manifestly valuable assets. So,

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too, are national independent bodies in the United Kingdom, such as the National Council for Vocational Qualifications, the Post Office Users' National Council and OFSTED.
The national council would not include those directly involved in contracting but would comprise senior industrialists, educationists and other community interests, including those with expertise and knowledge of helping clients with learning difficulties and disabilities. The CBI and TUC would have a key input, and the independent professional voice of the Institute of Careers Guidance should also be included.
The call for a national council is supported by an impressive range of organisations and associations with an obvious interest in the process of enabling individuals to maximise their talents, thereby securing the economic success of the country. Sir Bryan Nicholson of the CBI, Sir Christopher Ball of the Royal Society of Arts and the director of the National Institute for Careers Education and Counselling wrote in The Times in late February advocating the establishment of the council. The CBI followed that up only a few weeks ago with a major recommendation in its Routes for Success that a
"National Council involving Government, Employers, Educationalists and Careers Professionals [should be set up] to establish national standards for careers education and guidance".
Associations representing the combined voices of secondary head teachers, college principals, education officers, local authorities, careers teachers, disability groups and the Institute of Careers Guidance all support the need and value of the national council. I know of no major interest group or national organisation with a concern for quality careers education and guidance that does not support it. I think that the case is made and the argument won. I hope that we can have that reassurance from the Minister.
Lord McCarthy: The case has been made and we support it. If there is one simple thing that the Government can do to reassure the very large number of people who work hard in this difficult field it is to accept the amendment.
Baroness Denton of Wakefield: I have listened to the noble Baroness and I recognise the calls from outside this House to set up by statute a national council to oversee the work of the careers services. I do not want to dismiss this issue lightly as it is a very important matter.
The Government fully endorse and support the intentions of those proposing a national council; we also want to see a better and more effective careers service. But our disagreement with their proposal reflects a lack of clarity on what the role of such a council might be and how it would contribute to that aim. Proponents themselves do not seem clear. Is it to be a consumer watchdog? Is its main purpose to be quality assurance and inspection or is it to be concerned with strategic planning? Perhaps it aims to perform all these functions.
There are already well-established consultative arrangements; at official level there is the Careers
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Service Consultative Group, which has representatives from a range of organisations. It has proved to be a valuable forum for considering careers service matters. It will continue to operate, no doubt in a modified form to reflect the new arrangements.
The Secretary of State meets regularly with representatives of the Institute of Careers Guidance, the National Association of Careers and Guidance Teachers and the careers service Heads of Service Group. Careers service matters have been and can continue to be considered in a variety of forums, including the National Advisory Committee on the Employment of Disabled People, and by the recently appointed body responsible for overseeing achievement of national education and training targets.
We believe that the existing consultative arrangements modified to reflect the changes we expect to see in the stakeholders and providers of careers services will be sufficient. If they are not, the Secretary of State will be able to establish whatever arrangements are necessary and appropriate without being constrained by the terms of reference of a statutory national council. I note that in the letter to The Times, to which the noble Baroness referred, Sir Christopher Ball, Sir Bryan Nicholson and Mr. Tony Watts were not calling for a statutory national council.
I am pleased to give the assurance that the consultation arrangements for the provision of careers services are something that the Secretary of State will keep under review as the legislation is implemented and she will modify them as necessary. It has been noted, for example, that careers guidance professionals and stakeholders in guidance are now talking together across a broader front than in the past. If such discussions lead to the formation of a body of likeminded experts we would listen to what that group had to say. It is our intention to continue with the annual report on the careers service published by the Department of Employment. I hope that, with those remarks, the noble Baroness will feel able to withdraw her amendment.
Baroness Seear: To put it bluntly, the reason why many of us support the amendment is that we are not happy to leave it to the Secretary of State in consultation with other bodies. I do not want to be offensive about this, but to be frank, we do not trust them to do it. We want another body of high standing which can check them. They are busy checking what the other people do. We want a body that can check what the Secretary of State and advisers do. That is why we want the amendment.
Baroness Denton of Wakefield: I understand the noble Baroness's concern but I do, of course, have great confidence in the Secretary of State.
Baroness Seear: I was referring not to a particular Secretary of State but to Secretaries of State in general.
Baroness Denton of Wakefield: Perhaps I may re-emphasise what I said. If the discussions between careers guidance professionals and those other

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stakeholders in guidance lead to the formation of a body of likeminded experts, we would obviously listen to them.
Baroness David: I am extremely disappointed with that answer. My noble friend Lady Seear has put her finger on the point. We are not satisfied. We are not sure what these arrangements will be like. There is a great deal that we do not know about them so far. This proposal has had the support of a distinguished group of people, including the CBI and the TUC. I shall certainly come back to this point. If the noble Baroness wants something more specific, I am quite sure that after consultation we shall come back at Report stage with something that satisfies the noble Baroness rather better than this amendment. But come back we certainly shall. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 259 to 266 not moved.]
12.30 a.m.
Lord Stoddart of Swindon Lord Stoddart of Swindon moved Amendment No. 266A
Page 56, line 10, at end insert:
("(13) The Secretary of State shall lay before Parliament an annual report on how the duties and powers conferred on him under this section have been carried out in the preceding year".").
The noble Lord said: The object of this amendment is to ensure that, since the Secretary of State is taking over responsibility for careers services, she should be fully accountable to Parliament and provide it with a report as to how she has been administering the service and to what effect. The noble Baroness told us earlier how the Secretary of State was responsible to Parliament and how she would want to ensure that the service was carried out in a way which Parliament would expect of her.
Under the circumstances I believe that the noble Baroness will support this amendment. The kind of report we have in mind would include details of new services introduced, for example, and of services previously provided but discontinued by the Secretary of State, as well as the effectiveness of the total service.
At present there is some democratic accountability through local authorities, but once this Bill is enacted and implemented, there will be no accountability to anyone as far as we can see from the Bill. The Secretary of State will just wave her wand and say "I want this and that" and that will be the end of the matter. There will be no local council or committee. There will be no education authority and nobody at all —not even Parliament—according to the Bill. Therefore, the least we expect is a report from the Secretary of State to Parliament once a year. Surely that is not too much to expect. I look forward to the Government's acceptance of this amendment.
If the service is going to be so good and so much better under the Secretary of State than it is now, surely she will want to say to Parliament "Look at what I have done". She will want to put on record the improvements that she has made. I hope therefore under these circumstances that, without any hesitation at all, she will accept this amendment. I beg to move.
Baroness Denton of Wakefield: The Secretary of State for Employment presents to Parliament, jointly with the Chief Secretary to the Treasury, an annual report which sets out objectives and expenditure plans for the next three years. This already covers the department's work with respect to the careers service and it will continue to do so. In addition to describing the work of the department, the report gives an account of the department's performance in meeting its objectives. I am pleased to hear that the noble Lord, Lord Stoddart, is expecting improvements.
Similar arrangements exist in Scotland and Wales. There are ample opportunities, through the usual channels, open to Members of both Houses to inquire about the work of the careers services and the Secretary of State's duties to secure the services. In addition, it has been the practice of successive Secretaries of State, as I have said, regularly to produce reports on the work of the careers service. I expect that to continue. Such reports can he found in the Libraries of both Houses. The continuation of that practice will, I hope, satisfy the purpose of the noble Lord's amendment. I cannot see that anything of value will be added by imposing a duty on the Secretary of State, and I ask the noble Lord to withdraw his amendment.
Lord Stoddart of Swindon: I shall have to beg leave to withdraw my amendment at this time of night; but I am not really satisfied with that reply. After all, as I have said, this service has been run democratically at local level, responding to local needs. People have been able to see what is happening and to make representation to their local councillors and local authorities; but apparently they will no longer be able to do so.
What I want to see is a special report to Parliament, setting out exactly how the service is being run; how it has improved, or perhaps how it has not been improved; how it has failed; what its failings are and what can be done to put them right; and how the service can be extended to assist all the groups that need to use the service. I should also like Parliament to have the opportunity to debate the report. That is what democracy is all about. Although I fear that the Minister had not given a satisfactory reply, at this time of the night, I shall have to withdraw my amendment. However, I feel sure that we shall want to return to it on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 37 agreed to.
Clause 38 [Careers services: ancillary services.]:
Baroness Turner of Camden Baroness Turner of Camden moved Amendment No. 267:
Page 57, leave out lines 12 to 16.
The noble Baroness said: Clause 38 recognises that where a contract to provide the careers service is placed elsewhere than with the local authority, there may well still be services which the careers service would want the authority to provide for it. However, the restriction of such arrangements to two years in subsection (5), which my amendment seeks to delete, makes this only a short-term expedient. It mirrors similar provision in the Education Bill which would

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limit to two years the power of an LEA to provide goods or services to a grant-maintained school. The restriction is based on a dogmatic view, which appears to be the Government's ideology, that the private sector should and will develop to provide all the necessary services. We are of course familiar with that type of thinking from the Government.
The two-year restriction, which our amendment seeks to remove, seems even more inappropriate in the case of careers services. Careers offices will, in general, share premises with other local authority services. It will often be convenient to the public that services that they wish to visit or contact are to be found at a single and obvious site. Careers services may therefore not wish to have to find new offices simply because of new funding and management arrangements. As a relatively small service in any area, the careers service will need access to a range of support services and professional advice. It may well find it convenient to draw on the local authority for this, particularly in those cases where it may continue to share premises with the authority. It may also want to use the authority's printing and communication systems for contact with schools and pupils. A requirement to cease using the authority for anything after a set period can only add to the administrative burdens on a small service and runs the risk of actually increasing the overhead costs.
I am advised by the Association of Metropolitan Authorities that that restriction would be particularly harmful in the case of a number of partnership-type arrangements since the partnership would effectively be undermined. For example, if a partnership were funded via a TEC so that the LEA was not a direct party to the contract with the Secretary of State, or if the careers service was set up as an arm's length company (with LEA and TEC representation but with its own direct contract with the Secretary of State), subsection (5) would disbar the LEA from supplying goods and services in support of the partnership.
Looking at subsection (5), one cannot help thinking that it is designed to ensure that unless the Secretary of State chooses to contract with an LEA, the LEA will be written out of any real role within two years. Is that the Government's real intention? If so, it should be clearly stated. One would hope that that is not so. Partnership approaches to managing the careers service clearly have some advantages since they create opportunities for the service to draw upon the facilities and expertise that exist in TECs and LEAs. Omitting the subsection would make it clear that forms of partnership where the LEA is not directly involved in the contract with the Secretary of State will not be disadvantaged and that undue constraints will not be put upon the freedom of local careers services to choose the most appropriate source of goods and services. It would also avoid unnecessary administrative complications when LEA services are not easily replaced because of local circumstances.
It surely cannot be the Government's intention to oblige careers services to leave local authority accommodation for possibly more expensive premises, or, if they remain as tenants of the local
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authority, to oblige them to look outside for expensive services which may be available more cheaply and conveniently within the same building. The provisions of subsection (5), which stipulate a period of only two years during which the authority may provide goods or services, strike me as being particularly absurd unless it is part of a concealed agenda for writing out the role of LEAs altogether and for total and complete privatisation of a service which is most unsuitable for such a course. I beg to move.
Baroness Seear: I support the amendment. Will the noble Baroness give a straight answer? If this is not intended as a sign that the Government want to get rid of local authorities, what is it there for? Is it, or is it not, the intention that there will not be LEAs, if not at the end of two years, then very shortly afterwards? Is there any other conceivable reason why this provision should be in the Bill?
Baroness Denton of Wakefield: Local authorities are restricted in whom they can supply with goods and services. They are limited to providing those services to public bodies and certain defined organisations. Under this legislation for the careers service a wide variety of providers could emerge. These could include local education authorities.
I return to something I said at the beginning of the discussion on Clause 37. If LEAs' services are of the best, then they will continue. It is not the intention of the Bill to write local authorities out of the picture. Providers could also include local authority controlled companies, training and enterprise councils, local enterprise companies, joint ventures between LEAs and TECs (and in Scotland, education authorities and LECs) and other types of private providers.
As the law stands, many future providers of careers services would not be able to be provided with services from a local authority, even for a temporary period. We consider, as do many others, that many new providers will find those services valuable in getting started. By giving local education authorities the power to provide services to future providers of careers services for a transitional period of two years we will give time for careers services and private providers of such goods and services to become established. This is in line, as the noble Baroness noted, with the proposals for grant-maintained schools.
We want providers of careers services to be able to use local authorities' administrative, personnel and computer services for a transitional period to help them get established. Clearly such provision could be of considerable assistance. But the amendment would give LEAs a licence to trade indefinitely with careers service providers. It is not government policy that that should be available because local authorities exist primarily to perform their statutory functions. That is what charge payers and, from April, council tax payers are funding. They are not funding authorities to trade.
The prospect of an authority not being successful in its "trading" activity would entail too great a risk for local taxpayers' money. Moreover, if there were no time limit to the arrangements contained within

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Clause 38 there would be very little real incentive for private providers of goods and services to enter the market and become established. For those reasons, I ask the noble Baroness to withdraw the amendment.
Baroness Lockwood: Can the Minister explain how that fits in with some of her earlier comments in respect of previous amendments? She talked about the need to establish the best all round, about the need for variety and about it not being appropriate to be restrictive and to tie the hands of the Secretary of State. Surely all those comments apply to this particular amendment and to this particular service. We are not talking about a new service which is being given to local authorities; we are talking about a service which local authorities have had for a considerable time. The Government are making it possible for other competitors to come into the market.
All right, the Minister has won her case this evening simply because of the lateness of the hour and the number of Members present. However, she has not been logical throughout. If we are to have the best, and if there exist joint ventures where the two parties are not applying to be the provider but where they are working in co-operation, the rejection of the amendment will mean that those services which could be of the best will have to be phased out. That is really illogical.
12.45 a.m.
Baroness Denton of Wakefield: Perhaps I may attempt to reassure the noble Baroness, Lady Lockwood, that as regards the service given by the careers service the aim is to provide the best. However, the legislation moves to allow the development of the careers service during the next few years and allows it to have a transitional relationship with the local authority. The key issue of our difference is that it is not, however, the role of the local authorities to trade but to perform their statutory functions. They are not to perform trading functions. I do not believe that that impedes the best services available.
Baroness Turner of Camden: The noble Baroness said that she was seeking to reassure us. I am not at all reassured; quite the contrary. She said that the LEAs are not trading organisations but, on the other hand, they are already providing this service, as pointed out by my noble friend Lady Lockwood. The Government are introducing trading into the whole concept by introducing privatised companies but they are not even giving a reasonable period where services are already being provided by the LEAs. To say in an arbitrary way that there will be a cut off after two years seems to be entirely unsatisfactory.
In common with my noble friends, I realise that I cannot press the amendment to a vote. However, we must look at the matter again on Report because it is so unsatisfactory. To tell us all that we ought to be reassured just because the LEAs are not trading companies and all the rest of it is ludicrous and not at all satisfactory. However, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 38 agreed to.
Clause 39 [Employment and training functions of Scottish Enterprise and Highlands and Islands Enterprise]:
Viscount Ullswater Viscount Ullswater moved Amendment No. 267A:
Page 57, line 49, at end insert:
("(3B) Where Scottish Enterprise or Highlands and Islands Enterprise make arrangements under this section in pursuance of an authorisation or direction made by the Secretary of State under subsection (3A) (a) above, they shall, at such time as the Secretary of State may require, report to him what provision, if any, they have included in those arrangements in relation to disabled persons.").
The noble Viscount said: The inclusion of this clause in the Bill is to be welcomed. It rectifies an omission in the legislation which provided for the establishment of Scottish Enterprise and Highlands and Islands Enterprise, which are the bodies responsible for the full range of government-funded economic development and training functions in Scotland. At present their powers are broad enough to allow them to operate training but not work experience schemes. This clause provides for them, and through them the local enterprise companies, to cover the same range of training functions which the Secretary of State delegates to training and enterprise councils in England and Wales. As such, it is a technicality. But it is nonetheless important that we remove this anomaly and take steps to ensure that Scottish Enterprise and Highlands and Islands Enterprise are able in future to respond to any new initiative or programme.
This amendment, in itself, will have limited effect; but that is not to say that it is unimportant. The needs of people with disabilities are already well catered for in government programmes; this is a stipulation embodied in the existing legislation governing the powers of the two enterprise bodies. However, should Scottish Enterprise or Highlands and Islands Enterprise make arrangements in accordance with a ministerial requirement under the new subsection (3A) inserted by Clause 39, the amendment provides a discretionary power for the Secretary of State to require the enterprise bodies to report on the provision they make for people with disabilities. This ensures that the needs of people with disabilities will be taken into account in all eventualities.
A commitment was made in another place by my honourable friend the Minister of State to look again at the needs of people with disabilities under this clause. Amendment 267A will serve to ensure that Scottish Enterprise and Highlands and Islands Enterprise continue to keep this issue uppermost in mind in executing any training or employment-related function. I am satisfied that with this addition, Clause 39 completely fulfils all its intentions, and I commend it to the Committee.
Lord McCarthy: We welcome the amendment. Of course the Minister welcomes it. I was going to spend time asking why we do not have in England such excellent bodies as Scottish Enterprise and Highlands

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and Islands Enterprise, which have such beautiful names. However, it is too late in the evening for that. We welcome the amendment.
On Question, amendment agreed to.
Clause 39, as amended, agreed to.
Clause 40 agreed to.
[Amendments Nos. 268 to 271 not moved.]
Clause 41 [Miscellaneous and consequential amendments]:
On Question, Whether Clause 41 shall stand part of the Bill?
Baroness Turner of Camden: It may well be wondered why we have indicated our intention to oppose the Question that Clause 41 stand part of the Bill. It is rather complicated and I should like to take a few moments to explain.
It has recently come to my knowledge that the staff in the Palace of Westminster are not covered by the Health and Safety at Work etc. Act 1974. This is occasioning some worry particularly since, as I understand it, increasing numbers of staff here work under contracts held by outside firms, some of which are engaged upon structural work in the Palace. All employees, including clerical and administrative workers, have a right to work in a safe environment, but manual workers engaged on construction work are often rather more at risk.
It is understood that there are some reasons why it is thought it not appropriate that staff working in the Palace of Westminster should be covered by the health and safety at work legislation. It may be a matter of Crown immunity; I am not sure. However, I was sufficiently anxious about the matter to attempt to table an amendment to Schedule 6, the object of which was to extend the employment rights of House of Commons and House of Lords staff by the application to them of the health and safety legislation. The amendment went on to say that nothing in any rule of law or the practice of either or both Houses of Parliament should be taken to disapply the Act in the Palace of Westminster or any buildings or premises owned, leased or occupied by the corporate office of either House of Parliament.
I was advised that my amendment could not be printed on the first Marshalled List because the subject matter was not regarded as relevant to the subject matter of the Bill. I accepted that. I know that we have very experienced Clerks here and I accepted that I could not proceed with that amendment. However, I was anxious to find a way to ventilate the anxiety which I have about the need to extend to the staff who work here for us the cover of health and safety legislation applicable to employees generally. I have done so by giving notice that I intend to oppose the Question that Clause 41, which refers to the schedule that I was seeking to amend, should stand part of the Bill. I believe that notice has already been given to the department of the noble Viscount that I would be doing this. That was the reason why I, along with my two noble friends, had given notice that it was our intention to oppose the Question, That the clause should stand part of the Bill.
I am sure the noble Viscount will tell me that the
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rights of the staff here will be properly looked after because the Palace of Westminster is a benevolent employer. I do not doubt that that is so, but with respect it is not quite the same as having specific rights laid down in statute to which reference can be made if things go wrong. I know that this is a matter of concern to the staff here and for that reason, despite the lateness of the hour, I felt that I had to make these comments because on Report it is not possible to oppose the Question that the clause shall stand part of the Bill.
Lord Wedderburn of Charlton: Clause 41 also deals with the incorporation of Schedule 7 in the Bill. This may therefore be a convenient moment for me to say why, as I read it, Schedule 7 is unsatisfactory. I have not given the noble Viscount notice of this and I make my remarks with the intention that he may take them away and tell me if I have made an error in this matter. The conditions under which a ballot is required in regard to industrial action in Schedule 7 now differ as between the case where a trade union member can call for it and the case where other persons may sue in a civil action without the ballot because it is unprotected. The relevant references are paragraph 46 of Schedule 7 on pages 94 to 95 and paragraph 73 on page 99. The conditions there differ. If the noble Viscount tells me that I am in error in thinking that there is a difference, we shall not raise the matter on Report, but if my analysis is correct I shall raise the matter on Report.
Baroness Seear: I support what the noble Baroness, Lady Turner of Camden, has proposed. It is not frivolous of me to say, thinking back to what was going on some nine hours ago, that not only are the conditions of the staff working here very much below what could be desired, but the conditions in this Chamber are very much below what could be desired. After the protest we made earlier, I understand that the engineers were telephoned and the result was that the conditions became very much better. If the solution is as easy as that, the conditions never should be as bad as they frequently are. I assure the Minister that I am not the only person who finds the physical conditions in this Chamber almost intolerable on a great many occasions. I beg the Government to reconsider this matter.
Viscount Ullswater: I am sure that the comments of the noble Baroness, Lady Seear, will not fall on deaf ears. Before dealing with the Question of whether the clause shall stand part of the Bill, I should say to the noble Lord, Lord Wedderburn, that I am pleased he has given me notice of the point he wishes to raise with regard to Schedule 7. I have noted the paragraphs he mentioned. I shall consider carefully his comments and make certain that what we intend is correctly drawn in the statute.
As regards the clause stand part debate, the Trade Union Reform and Employment Rights Bill concerns miscellaneous aspects of the relationship between employers and employees, the functioning of their respective associations and unions, and their interaction with each other. It is not about the law

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regulating physical conditions obtaining at the workplace. The extension of the Health and Safety at Work etc. Act 1974 to House of Commons and House of Lords staff would therefore be outside the scope of this Bill. However, it may help Members of the Committee if I update them on recent discussions between the Health and Safety Executive and the Palace authorities regarding the extension of the Health and Safety at Work etc. Act to the Palace of Westminster. The Palace authorities have agreed in principle to this extension, and this will be dealt with in the next appropriate legislation. In the interim there is no suggestion that standards of health and safety at the Palace of Westminster are inferior to those of other employers. Indeed, HSE already inspects the Palace of Westminster at the invitation of the Palace authorities.
I hope that that reassures the noble Baroness and that she will not press the matter to a vote.
Lord McCarthy: Before the noble Viscount sits down, can he tells us whether the Government plan to do that little thing in their planned legislation in this Session, this Parliament or beyond?
Viscount Ullswater: I am afraid that I cannot be quite as helpful to the noble Lord as he would wish. He must be content with the words that I used—namely, that it will be done when a suitable occasion occurs.
Clause 41 agreed to.
Schedule 6 agreed to.
1 a.m.
Schedule 7 [Consequential amendments]:
Viscount Ullswater Viscount Ullswater moved Amendment No. 271A:
Page 89, line 23, after ("60") insert ("or 60A(1)").
The noble Viscount said: I spoke to the amendment with Amendment No. 186A. I beg to move.
On Question, amendment agreed to.
[Amendments Nos. 272 and 273 not moved.]
Viscount Ullswater Viscount Ullswater moved Amendments Nos. 274 and 275:
Page 99, line 19, after ("action)") insert ("; and in those sections "not protected" means excluded from the protection afforded by this section or, where the expression is used with reference to a particular person, excluded from that protection as respects that person." ").
Page 99, line 20, leave out paragraph 72.
The noble Viscount said: Amendments Nos. 274 and 275 form part of a grouping debated with Amendment No. 65. I beg to move.
On Question, amendments agreed to.
[Amendment No. 276 not moved.]
Schedule 7, as amended, agreed to.
Clause 42 agreed to.
Schedule 8 [Transitional provisions and savings]:
[Amendment No. 277 not moved.]
Schedule 8 agreed to.
Clause 43 agreed to.
Schedule 9 [Repeals and revocations]:
Viscount Ullswater Viscount Ullswater moved Amendment No. 277A:
Page 107, line 3, column 3, at beginning insert ("Section 11(3) and (7).").
The noble Viscount said: I hope that: this purely technical amendment need not detain us. Its purpose: is to delete subsections (3) and (7) of Section 11 of the Employment Protection (Consolidation) Act 1978. Those provisions no longer have any practical effect as they relate to Section 4(3) of that Act, a subsection which was deleted by an amendment which the Government brought forward at Report stage in another place in response to a point raised by the Opposition during Committee stage debate. The amendment now before us is a purely consequential one which should also have been made at that time but was inadvertently missed. I commend it to the House. I beg to move.
On Question, amendment agreed to.
Viscount Ullswater Viscount Ullswater moved Amendment No. 278:
Page 110, line 5, column 3, leave out (" "not protected" ").
On Question, amendment agreed to.
Schedule 9, as amended, agreed to.
Clauses 44 and 45 agreed to.
Clause 46 [Northern Ireland]:
Lord Blease Lord Blease moved Amendment No. 279:
Page 60, leave out line 8.
The noble Lord said: I hope that I shall not detain the Committee long because it has been a long day and I know that many Members of the Committee are weary.
Clause 31, which was dealt with earlier, relates to the abolition of Part II of the Wages Act 1986, which applies to wages councils in Great Britain. One could argue that that Clause 46(2) (f) has been wrongly drafted as Section 31 of the Wages Act 1986 does not apply to Northern Ireland. Since 1920 there has been a separate body of trade union and industrial law for Northern Ireland as distinct from the body of law for Great Britain.
In moving the Industrial Relations (Northern Ireland) Order 1992, the Northern Ireland spokesman, who was also the Paymaster General, the noble Lord, Lord Belstead, stated on 28th February 1992 at col. 512 of Hansard:
"As your Lordships will appreciate, the legal and administrative framework for industrial relations in Northern Ireland is separate from that in Great Britain but the legislation has generally followed that in the remainder of the United Kingdom".
The main point I seek to make is that the legislation is separate and the administration too is distinctly separate. At this late hour I do not wish to prolong the debate, but there is a long history of acute problems which arise because of the two distinct bodies of laws and the two different administrative systems.
I have a list of examples. One example of the separate legislative framework is the enactment of the Trade Disputes Act 1927. It was enacted in Great Britain and followed through in Northern Ireland. That had nothing to do with strikes, but I give that as an example of how the two systems can vary considerably.
Allowing for the direct route regime, the legislative provisions which are set out at the commencement of Clause 46, I question the constitutional propriety of the inclusion of "section 31" at page 60, line 8, if it does what I assume it intends to do but does not so

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state: that is, to abolish the wages councils in Northern Ireland. The wages councils in Northern Ireland are enshrined in the Wages (NI) Order 1988. Paragraph 14 of the order states:
"The Department may at any time by order abolish, or vary the scope of operation of, any wages council. Before making an order under this Article the Department shall have regard to the current levels of remuneration among any workers in relation to whom the wages council concerned would cease to operate, or (as the case may be) begin to operate, as a result of the order, and such other matters as appear to it to be appropriate, and shall consult such persons or organisations as appear to it to be appropriate".
That clearly states that there has to be in the legislation a separate and distinct framework of effective consultations with each individual wages council operative.
Nowhere in the Bill do I see reference to the Wages (NI) Order 1988. It is not even quoted in the schedules. In that connection, there has been an exchange of letters between Mr. Carlin, the secretary to the Northern Ireland Committee of the Irish Congress of Trade Unions and the Secretary of State for Northern Ireland, the right honourable Sir Patrick Mayhew, as well as Mr. Robert Atkins, the Northern Ireland Minister for the Economy.
That correspondence is not of a private or confidential nature. It deals with issues relevant to the clause. However, I do not believe that it is feasible, nor would it be helpful, if I were to debate the matters contained in this correspondence at this late hour, after one o'clock in the morning.
I simply wish to quote from one part of a letter from Mr. Atkins which indicates the relevance of my keeping the Committee at such a late hour. He states:
While this means there is no consultation period (as with an affirmative order) it does allow MPs"—
and I assume Members of your Lordships' House also—
"to debate the clauses and to seek amendments on the floor of the House."
That is a statement from the Minister responsible for economic and industrial affairs in Northern Ireland. It indicates that there have to be effective consultations.
There are 10 listed provisions in the Bill relevant to Northern Ireland and subject to the negative resolution order; there are 19 listed provisions subject to the positive resolution order. I suggest that paragraph (f) should be included in the positive resolution list. Nothing would be lost and I believe much would be gained in the Northern Ireland context if that was undertaken.
I have tried to be as succinct as I can in handling the matter which is serious for the constitution and as the Bill applies to industrial relations in Northern Ireland. Will the Minister reply to the points I have made?
Viscount Ullswater: I am afraid that the amendment tabled by the noble Lord, Lord Blease, is not one which I am able to accept. The negative resolution provisions contained in Clause 46 of the Bill will enable legislation to be introduced for Northern Ireland on the same timescale as in the rest of the United Kingdom.
The proposed amendment would remove the abolition of wages councils from the clause, thereby
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requiring the affirmative resolution procedure to be used for an order abolishing wages councils in Northern Ireland and so delaying their abolition.
The Government have repeatedly made known their opposition to wages councils which distort the labour market and add to the burdens on business. It would be anomalous to abolish them in Great Britain yet permit them to remain in Northern Ireland for any length of time.
There are no good reasons why the councils should remain in Northern Ireland. Their abolition is as important in Northern Ireland as it is in the rest of the United Kingdom. The question of abolition has been thoroughly debated and voted on a couple of times by Members of the Committee today.
A consultation document seeking views on the abolition of the Northern Ireland wages councils was circulated in Northern Ireland in late 1988 at the same time as consultations were taking place in Great Britain. I believe that the consultation requirements have been acceded to; therefore I ask the noble Lord, Lord Blease, to withdraw his amendment.
Lord Blease: Before the noble Viscount sits down, did I hear him say that the affirmative resolution would be introduced?
Viscount Ullswater: I believe that I said that it was suitable for the negative resolution and that if it were removed from the clause it would have to be done on an affirmative resolution.
Lord McCarthy: I am sorry, I understood the noble Viscount to say that one of the reasons why he could not accede to the request of my noble friend was because to move to an affirmative resolution would cause delay. Is that right? How much delay would it cause?
Viscount Ullswater: As Members of the Committee know, the tabling of an affirmative resolution cannot be done as quickly as with a negative resolution. It demands time in Parliament.
Lord Blease: I am sorry. This is my last point. What is to be gained in any way—from the industrial relations point of view or as regards the position in Northern Ireland—from pushing ahead with this negative order for immediate action to coincide with the situation in Great Britain? My view and that of many people in Northern Ireland is that there is nothing to be gained. On the other hand, much would be gained by waiting until the affirmative resolution was available and a consultation period could take place.
Viscount Ullswater: I cannot agree with the noble Lord. The consultation period is now past. The publication of the Bill provided another period of reflection. The matter has been fully debated in another place and in your Lordships' House. It has been voted on. Possibly the right way to tackle it is to do it simultaneously both in Great Britain and in Northern Ireland.
Lord Blease: I am not happy with the Minister's reply. I beg leave to withdraw the amendment, but on the understanding that I shall raise the matter again at Report stage.
[Amendment, by leave, withdrawn.]
Clause 46 agreed to.
Clause 47 agreed to.
House resumed: Bill reported with amendments.

Dawat-e-Hadiyah (England) Bill
Read a first time, and referred to the Examiners.

Pwllheli Harbour (Amendment) Bill
Read a first time, and referred to the Examiners.
House adjourned at sixteen minutes past one o'clock.