Lords Sitting of 24 May 1993

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

Group 4
Lord Molloy Lord Molloy asked Her Majesty's Government:
Whether they are satisfied that Group 4 has been handling the obligations of its contract with the Prison Service in a competent manner.
The Minister of State, Home Office (Earl Ferrers): My Lords, difficulties were experienced in the early weeks of the court escort contract, some of which were outside the control of the contractor. We are satisfied that Group 4 has the capacity to meet its contracts with the Prison Service.
Lord Molloy: My Lords, I thank the Minister for that Answer. Is he prepared to consider the prison officers' recommendations, the anxiety felt at many levels, the spate of worrying escapes and the alarming deaths in prison? Is it not time to take stock and to decide whether Group 4 is responsible and answerable for what is happening in the Prison Service today?
Earl Ferrers: My Lords, the noble Lord, Lord Molloy, takes an extreme view. Group 4 had five prisoners escape from escort in the first two weeks. That compares, if I might say so, reasonably with the Prison Service. The whole purpose of contracting-out the work is to relieve the Prison Service and the police service from carrying out the functions that they are carrying out. That has resulted in a saving from which prisoners and others will benefit.
Lord Campbell of Croy: My Lords, was the employment of Group 4 part of a wider government policy to help relieve overcrowding in British prisons?
Earl Ferrers: My Lords, the policy is simple. It is that it is possible for the private service to do the work carried out at the moment by prison officers, whether in prison or on escort service, possibly cheaper, certainly better, and with any luck there will be a considerable improvement in the standards of those in prison. If that can be done at a cost which is the same or less than that provided by the Prison Service, it seems that everyone should be satisfied.
Lord Mason of Barnsley: My Lords, the Minister said Group 4 compared favourably with the Prison Service. What are the figures for the Prison Service?
Earl Ferrers: My Lords, I am sorry but I did not catch the end of the noble Lord's question.
Lord Mason of Barnsley: My Lords, the Minister said that Group 4's figures compared fairly and favourably with those of the Prison Service. What are the figures for the Prison Service?
Earl Ferrers: My Lords, there were 380 escapes from escorts by the police and the Prison Service. That amounts to 32 a week. Group 4 lost five in the first two weeks.
Lord Cledwyn of Penrhos: My Lords, are Group 4's personnel scrutinised or passed by any government agency such as the Home Office?
Earl Ferrers: My Lords, yes. Those who tender for work, and those who take part in the work of Group 4, are vetted and given seven weeks' training, which brings them up to the standards required by the Government.
Lord Cledwyn of Penrhos: My Lords, who does the training?
Earl Ferrers: My Lords, principally the trainers. I cannot give the noble Lord more detail than that.
Lord Elton: My Lords, is not Group 4 also involved in the contract for the Wolds Prison? Is that benefiting the Prison Service?
Earl Ferrers: My Lords, it is benefiting the Prison Service. As I explained earlier, there were admittedly two escapes from the Wolds Prison. The result of the Wolds Prison being administered by a private contractor is that the prisoners there have more time off, more education and more time out. I believe that they have better clothing and, possibly, also better food.
Lord Jenkins of Hillhead: My Lords, is the Minister assured that when he gave the figure of 335, as I think it was, escaping from the Prison Service as against five from Group 4, he was comparing like with like, both so far as concerns the timescale and the degree of security of the prisoners involved?
Earl Ferrers: My Lords, no, I was not comparing like with like. I was doing my best to answer the question that I was asked. I told the noble Lord, Lord Cledwyn of Penrhos, that there were 380 escapes per year from escorts carried out by the police and Prison Service, which is an average of 32 per week. I said that Group 4 lost five in the first two weeks. That covers only an area and not the whole country.
Lord Jenkins of Hillhead: My Lords, does the Minister think, therefore, that the figures he quoted were remotely helpful to the House?
Earl Ferrers: My Lords, frankly, I thought that they were extremely helpful. The noble Lord, Lord Jenkins of Hillhead, can do his own mathematics and algebra if he likes but I believe that I gave the noble Lord, Lord Cledwyn, the answer to the question that he asked.
Lord Ennals: My Lords, I understand that the chairman of the Conservative Party is also one of the directors of Group 4. First, is it wise for a senior politician to have a close relationship, such as a contractual relationship, with a government department? Secondly, does Group 4 benefit more from his experience as chairman of the Conservative Party than the Conservative Party benefits from his experience as a director of Group 4?
Earl Ferrers: My Lords, that question was slightly out of keeping with the noble Lord, Lord Ennals, who must be well aware that the chairman of the Conservative Party is not a Cabinet Minister. He, like anyone else, can have such directorships as he desires and are required. The information which he can give, or which he gathers, as a director of that or any other organisation must be a matter for the organisation and him. There is nothing wrong with that at all.
Lord Stoddart of Swindon: My Lords, since Group 4 and the Conservative Party are down on their uppers is it not time that the chairman resigned?
Earl Ferrers: My Lords, Group 4 is not down on its uppers; the Conservative Party is not down on its uppers. I can give the noble Lord the categorical assurance that, as far as I know, neither the Government nor any of their members have any intention, and will have any intention, of resigning
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over Group 4. As I explained last week, there were several teething difficulties after the takeover but it is expected that those difficulties will be overcome.
Lord McIntosh of Haringey: My Lords, what sanctions are available against Group 4 for non-performance of the duties in its contract? The non-performance of duties includes not only escapes but the death of a prisoner in custody and allegations that prisoners have been kept in illegal leg shackles. What sanctions exist for non-performance and have any yet been applied?
Earl Ferrers: My Lords, the sanctions applicable to any contract are financial and ultimately there is the ability to cancel the contract. There was the death of a prisoner while in the custody of Group 4 and the matter is now being considered. A full inquiry is being held and it would be wrong for me to attribute blame, or anything else, until that is complete. The noble Lord also referred to leg straps. They were used on a couple of occasions when two prisoners were being particularly difficult and violent and had to be restrained. There is nothing in the Prison Service orders which prevents that.
Lord Molloy: My Lords, bearing in mind the replies which the Minister has given to the many questions which have been asked today, including the four issues which I raised, will he at least assure the House that it is not unreasonable to take stock of what has happened in the Prison Service since Group 4 has had responsibility?
Earl Ferrers: My Lords, of course we are taking stock but we should not reach too many conclusions too quickly. On a number of occasions the Director-General of the Prison Service has seen representatives of Group 4 about these matters and the position is being tightened where possible. I must remind the House that the duties taken over covered seven counties, seven police forces, 72 magistrates' courts, 10 Crown Courts, 71 police stations and 20 prisons—
A noble Lord: Too many!
Earl Ferrers: My Lords, in retrospect that may be so but there were two alternatives; either the whole lot was taken over altogether or it was taken over in bits and pieces. It was considered best that the takeover should be undertaken in one fell swoop. It may be with hindsight that we should have done so less quickly but because there were difficulties at the start there is no reason to believe that the regime will not work. It will.
Lord Strabolgi: My Lords, as the takeover was done so widely and so quickly —as the Minister said —is it not a fact that women secretaries have been obliged to drive prison vehicles because Group 4 has been short of staff?
Earl Ferrers: My Lords, there is nothing peculiar in people who are not prison or escort officers driving vehicles. That frequently occurs and there is nothing wrong with that.

NHS: London Specialty Reviews
2.46 p.m.
Baroness Jay of Paddington Baroness Jay of Paddington asked Her Majesty's Government:
When the reviews of medical specialties announced in Making London Better, and due to be completed in May, will be made publicly available, and what opportunities there will be for public consultation before any further action is taken on the basis of these reviews.
The Parliamentary Under-Secretary of State, Department of Health (Baroness Cumberlege): My Lords, the specialty reviews are due to be presented to Ministers as independent advice in June and will subsequently be published. Together with the review of special health authority research and the assessments of London hospital sites, the specialty reviews will inform decisions on the future pattern of hospital services in the capital. There will be full public consultation, where appropriate, on subsequent proposals for change.
Baroness Jay of Paddington: My Lords, I am grateful to the Minister for that helpful Answer. I am glad that the time limit on the reviews has been extended from the end of May. Is the Minister aware that there is anxiety about the nature of the reviews? As was said in Making London Better and as she repeated in her Answer today, the reviews will have some impact on the modification of acute services; for example, the possible closure of hospitals in London. Will the Minister assure the House that in addition to those involved in the health professions users of the services will be included in the consultation?
Baroness Cumberlege: My Lords, there will not be a full consultation on the reviews per se. Consultation will take place when there is a recommendation to alter the services. But there is a patient representative on each review team; that is, except for the plastic surgery review.
Baroness Jeger: My Lords, is the Minister aware that in the document mendaciously called Making London Better there is an undertaking at paragraph 25 that the London Implementation Group will establish a primary health care forum which will report by 1st April 1993? Has that undertaking been fulfilled, and, if not, why not and when will it be?
Baroness Cumberlege: My Lords, the report states that the London Implementation Group will establish a primary health care forum to develop an agenda for change and that it will report back on a programme for the first two years by 1st April 1993. The primary health care forum has been established and it has reported back on a programme.
Lord Ennals: My Lords, bearing in mind the crucial nature of the decisions which have to be taken and their effect on millions of people in the Greater London area, does not the Minister believe, first, that it would be wise to have proper consultation rather than to wait for implementation? Secondly, I was glad
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to hear the Minister say that the reports will be published. But will that include also the publication of the evidence that has been given to the review teams?
Baroness Cumberlege: My Lords, there will be proper consultation as soon as recommendations are made on changes to any of the London hospitals or services. There will not be consultation on the individual reviews which have taken place, just as there will not be consultation on the review of special health authority research. Both those studies and the evidence given to the review teams are elements in order to help the regional health authorities formulate recommendations to the Secretary of State on the changes in hospital services.
Lord Ennals: My Lords, I am grateful to the noble Baroness for that reply, but will she tell me whether the evidence which was given to the review teams is to be published?
Baroness Cumberlege: My Lords, as I understand it, not as appendices. It is part of the evidence that has been given to the review teams in order for them to reach their conclusions. The full reports will be published. But I very much doubt whether the review teams will wish to isolate specific evidence.
Lord Skelmersdale: My Lords, one of the problems in London, and, indeed, in the conurbations as a whole, is that people have made far too much use of hospital out-patient departments instead of using their GPs, where those GPs exist in the local area. Will my noble friend say what plans the Government have, first, to increase the number of GPs in under-serviced parts of London and, secondly, to persuade people not to use hospital out-patient departments?
Baroness Cumberlege: My Lords, the Government have set aside for this year alone £43.5 million to invest in primary health care. The Government are anxious that people should use appropriately accident and emergency departments and out-patient clinics, but that depends on the primary care being of the standard which enables them to do so. We have been very much aware that the level of primary health care in London has been poor. That is why we must re-order the services and ensure that less money is spent on acute services and more is spent on primary health care.
Baroness Jay of Paddington: My Lords, perhaps I may press the Minister as regards going back to her right honourable friend the Secretary of State on the nature and timing of proper consultation. Is it acceptable for there to be consultation once decisions have been taken on the reorganisation of acute services rather than, as it said in the original document, in the light of the specialty reviews which may cause modification of those decisions? Surely the time to talk to the users of the services is before decisions are taken.
Baroness Cumberlege: My Lords, the noble Baroness is absolutely right. The Government will consult once the final recommendations have been made.
Lord Rea: My Lords, following the question asked by the noble Lord, Lord Skelmersdale, will the Minister say on what evidence the thinking is based which implies that increasing the primary health care services will reduce the need for hospital services? Is she aware that a substantial body of medical opinion believes that improving primary care in areas where there is deprivation will lead to an increased need for hospital services rather than a reduction?
Baroness Cumberlege: My Lords, recent studies which we have undertaken show that at least 10 per cent. of patients are admitted to London hospitals who, if they were situated and living outside London, would be treated by their GPs. I believe that it is reasonable to suppose that if we improve primary health care services there will be less call on acute hospital services.

Metropolitan Police Stolen Vehicle Squad
2.54 p.m.
The Viscount of Falkland The Viscount of Falkland asked Her Majesty's Government:
What plans they have for the future of the Metropolitan Police Stolen Vehicle Squad.
Earl Ferrers: My Lords, the commissioner will retain a centrally-based stolen vehicle squad to deal with major organised motor vehicle crime in London.
The Viscount of Falkland: My Lords, I thank the noble Earl for that reply. Is he aware that at this time of proposed reorganisation of the police, many rumours are flying about and there is much anxiety on the part of organisations and groups which have an interest in vehicle crime? Bearing in mind the considerable successes which the Metropolitan Police Stolen Vehicle Squad has had with regard to all kinds of crime ranging from small cars to articulated lorries and earth-moving equipment, there is much concern that the funding and expertise of that squad should be maintained.
Earl Ferrers: My Lords, I agree that when there is any form of uncertainty, rumours fly around. Usually such rumours are wrong. The whole purpose of any kind of reorganisation is to make the police even better than they are at present. At present there are 49 officers in the squad of whom 17 are vehicle examiners and 18 are civilians. The proposal is that four of the 17 examiners' posts will be civilianised. It is a matter for the commissioner how he disposes of his resources, but I assure the noble Viscount that there is no question of cutting out that particular squad.
Lord Jenkins of Putney: My Lords, is the noble Earl aware that my car was stolen about three months ago? I received a form from the police which I filled in and I have heard nothing further. I have received the very strong impression that when cars are stolen, everybody gives up. It seems that nothing whatever can be done. It seems to have become a feature of our lives which we accept. I hope that I am wrong in my belief but that is the impression which I have gained from personal experience.
Earl Ferrers: My Lords, I am sorry indeed to hear that the noble Lord, Lord Jenkins of Putney, had his car stolen. I was not aware of it and he has my commiserations. I wonder whether he locked the car properly and ensured that the burglars could not get in. I believe that I am right in saying that something like 40 per cent. of all forms of burglary and so on result from the burglars being able to gain access through open doors and windows. I can see that the noble Lord, Lord Jenkins, is about to rise to his feet. I have no doubt that he locked his car. I am sure that the police will do their best to find it for him.
Lord Strathcarron: My Lords, will the Minister agree that the stolen vehicle squad has had many successes? It caught a gang which was stealing a large number of Harley-Davidson motorcycles, particularly in the London area, and it also caught a gang which was stealing Peugeot GTis and exporting them to the West Indies. It would be a great shame if the squad was not allowed to continue with its extremely good work.
Earl Ferrers: My Lords, I am grateful to my noble friend for pointing that out because it is exactly that kind of car crime with which the squad deals. A centrally-based stolen vehicles squad will be retained to deal with major organised motor vehicle crime in London and also to provide support and assistance to the divisions where necessary. The kind of vehicle crime to which my noble friend referred underlines the importance of the squad.
Lord Molloy: My Lords, does the noble Earl agree that there is one aspect of the stolen squad which commands our full support; namely, those who investigate abandoned vehicles which might contain bombs? The squad does splendid work and deserves our full support. Will the noble Earl assure the House that every assistance will be given to it in that difficult task?
Earl Ferrers: My Lords, I assure the noble Lord, Lord Molloy that we are dealing not with a stolen squad but with a stolen vehicle squad. Such a squad is concerned with any kind of stealing. I assure the noble Lord, Lord Molloy that the greatest attention is paid to the possibility of undesirable objects being placed in abandoned vehicles.
Lord McIntosh of Haringey: My Lords, is the Minister aware that for many of us the phrase "no plans" from a government Minister means that it will not be done immediately but will be done very soon afterwards? Will the Minister change his wording and say that the stolen vehicle squad will not be disbanded or its powers or abilities infringed in any way?
Earl Ferrers: My Lords, the noble Lord, Lord McIntosh, is the most curious of people because he tries to put words into my mouth that I have not said. I said that the Government have no plans. As far as I know, the commissioner has no plans, but I cannot tell the noble Lord what the commissioner's plans may be in a week, a year or five years' time. I can tell the noble Lord, Lord McIntosh of Haringey, that four of the

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examiner posts are to be staffed by civilians; and that is all. Of course, there are more people in the stolen vehicle squad.
Lord Brougham and Vaux: My Lords, can my noble friend confirm that the co-operation at Interpol will still continue, as has been the case?
Earl Ferrers: Yes, my Lords.

EC-US Procurement Practices: Reciprocity
3 p.m.
Lord Campbell of Croy Lord Campbell of Croy asked Her Majesty's Government:
Whether they are satisfied with the agreements reached between the European Community and the United States of America on reciprocity in access to public procurement contracts.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Baroness Denton): My Lords, the agreement reached between the European Community and the United States is an excellent one. Both sides have agreed to liberalise their procurement practices for all central government purchases and for the electrical sector; and, at the sub-federal level, the US administration is to make all efforts to remove "Buy America". It will open up major new opportunities for British suppliers in many areas of the United States public procurement market. Unfortunately, the dispute in the telecommunications sector remains unresolved and I regret that there is still a risk of limited US sanctions as a result.
Lord Campbell of Croy: My Lords, I am grateful to my noble friend for that welcome reply. While it appears that there has been a significant reduction by the United States in its barriers against tenders from the EC—and much of the credit for that should go to Sir Leon Brittan—is there now a prospect of negotiations in the foreseeable future for further reducing the barriers which still remain on both sides of the Atlantic?
Baroness Denton of Wakefield: My Lords, my noble friend Lord Campbell of Croy is right to congratulate the right honourable Sir Leon Brittan on the significant rolling back of measures. We can hope that is the start of some significant change; but, in itself, it is a major step forward.
Lord Barnett: My Lords, does the Minister's excellent answer mean that Members of your Lordships' House will also have access to those contracts?
A noble Lord: She is mystified.
Baroness Denton of Wakefield: Yes, my Lords; I am rather mystified. But I suspect that the answer is yes.
Lord Peston: My Lords, I shall not pursue that theme. What the Minister said is good news. But reciprocity means equal treatment from both sides. I understand the point the Minister made about central
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government. However, am I not right in thinking that it is still true that at the level of the individual states, where a great deal of public expenditure takes place in the US, there is not much reciprocity? Further, if there is to be a next phase, as pointed out by the noble Lord, Lord Campbell of Croy, surely something must be done about what happens at the level of the individual states. Can the Minister give us any information as to what progress is being made? Their tendency to buy American—and, indeed, to buy in the narrower sense —has been known for a great many years as being not unconnected with a degree of corruption.
Baroness Denton of Wakefield: My Lords, the noble Lord, Lord Peston, would not expect me to comment on American practice in the detail that he just outlined. However, part of the discussions between the United States trade representative, Mr. Kantor, and the right honourable Sir Leon Brittan covered the fact that the United States is to make efforts to eliminate "Buy America" at sub-federal level. I utterly agree with the noble Lord that that is crucial.
Lord Stoddart of Swindon: My Lords, in so far as British Rail's franchising may well be a public service contract (a public procurement contract), will it be possible for the United States to tender for a railway franchise—as indeed the nationalised French railways and the nationalised German railways may do —when BR itself will not be able to tender for such a franchise? If so, will the Minister please explain the position?
Baroness Denton of Wakefield: My Lords, I shall contain my answer to that part of the noble Lord's question which reflects the Question on the Order Paper. On that basis, I am delighted to tell the noble Lord, Lord Stoddart, that UK industry has everything to gain from an agreement that opens up procurement. It is for the benefit of the taxpayer that such matters are available.
Lord Bruce of Donington: My Lords, the Minister has already indicated that she cannot comment on the arrangements that apply within the United States of America. Will she therefore give the House an assurance that those liberalisations of public procurement contracts do apply at present within Europe?
Baroness Denton of Wakefield: My Lords, I am pleased to tell the noble Lord, Lord Bruce Donington, that Article 29 of the Utilities Directive was seen as a useful negotiating tool—and indeed it has proved to be so. Part of the agreement between the right honourable Sir Leon Brittan and Mr. Kantor was that both sides are to sponsor an independent study into their respective procurement opportunities. With that information, we shall undoubtedly be able to make more progress.
Lord Monkswell: My Lords, bearing in mind the Government's replies to the questions so far, I believe it is right to say that they have been about the relationship between the European Community and the United States. Can the Minister advise us what contacts have been made between the United

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Kingdom Government and the individual states of the United States to ensure reciprocity in terms of realistic trade relationships?
Baroness Denton of Wakefield: My Lords, as the noble Lord well knows, the question of negotiation is a matter for the Commission. However, I believe that I have some evidence which indicates that there is constant contact with various areas of the states. I am delighted to tell the House that in the first quarter of 1983, in comparison to 1982, our exports to that country increased by 27.9 per cent.

Business
3.7 p.m.
Lord Hesketh: My Lords, I must, first, apologise for the length of today's Business Statement. It may be for the convenience of the House if I outline the procedure to be followed on the Trade Union Reform and Employment Rights Bill today.
The House agreed last Thursday to recommit the Bill in respect of the amendment to insert a new clause before Clause 13. Amendments Nos. 1 to 11 on the Marshalled List which has been printed and made available to your Lordships will be debated in Committee.
On conclusion of Committee proceedings, with the leave of the House, my noble friend Lord Cranborne will repeat in the form of a Statement the answer to a Private Notice Question in another place on Bosnia. During that time, amendments may be tabled for the Report stage of the Trade Union Reform and Employment Rights Bill. Those amendments will be circulated in the usual way. The House will then proceed to receive the Report and take any amendments which may have been tabled and, on conclusion of the Report stage, will move directly to Third Reading. Amendments to be moved on Third Reading are marshalled on the list available to your Lordships, beginning on page 3 of that list.
It may also be for the convenience of the House to know that proceedings on the Trade Union Reform and Employment Rights Bill will be adjourned at about 7 p.m. for about one hour and that during the adjournment the Third Reading of the Disabled Persons (Services) (No. 2) Bill will be taken.

Pension Schemes Bill [H.L.]
The Lord Chancellor (Lord Mackay of Clashfern): My Lords, I beg to move that the Bill be now read a second time.
This Bill consolidates the enactments relating to private occupational and personal pension schemes other than those relating to the treatment of such schemes for taxation purposes. The principal Act relating to pension schemes is the Social Security Pensions Act 1975, but further provision about the subject has been made almost annually by successive Social Security Acts. The need for a consolidation has therefore become pressing.
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The consolidation Bill contains a number of minor technical amendments to give effect to recommendations of the Law Commission and the Scottish Law Commission which are necessary to produce a satisfactory consolidation. The amendments are contained in the joint report of the two commissions. I wish to take the opportunity of expressing my appreciation to both commissions and to the draftsman for their work in producing the consolidation.
If your Lordships are content to give the Bill a Second Reading, it will be referred in the usual way to the Joint Committee on Consolidation Bills.
Moved, that the Bill be now read a second time. —(The Lord Chancellor.)
On Question, Bill read a second time, and referred to the Joint Committee on Consolidation Bills.

Trade Union Reform and Employment Rights Bill
3.10 p.m.
The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater): My Lords, I beg to move that the House do now resolve itself into a Committee (on Recommitment) pursuant to the resolution of Thursday last.
Moved, that the House do now resolve itself into Committee (on Recommitment).—(Viscount Ullswater.)
The Lord Chancellor: My Lords, the Question is that the House do now resolve itself into Committee (on Recommitment) pursuant to the resolution of Thursday last.
Baroness Turner of Camden: My Lords, we are not, of course, on this side of the House opposing that the House should go into Committee on this section of the Bill as that was agreed by your Lordships last Thursday. Indeed, we had been pressing for that ourselves through the usual channels ever since we understood precisely what was involved, or likely to be involved, as we did not see the text of the new clause until late last Wednesday.
I would, however, like to take this opportunity to place some remarks on the record. The noble Viscount said that,
"the Court of Appeal reached a judgment last Friday which held an employer to be in breach of the law now contained in Section 146 where he had offered financial inducements to his employees to move away from collective negotiation to personal contracts.
It was never the Government's intention, when the current law on action short of dismissal was introduced, that it should be interpreted in this way or that it should interfere with an employer's freedom to seek to make such a change".—[Official Report, 6/5/93; col. 860.]
The Minister said it was the intention to introduce an amendment to clarify the law in that area. At that time the text of the Court of Appeal's decision was not available; nor was it known whether or not there would be an appeal to the House of Lords. The Government had apparently made up their mind without knowledge of these important points. It is hardly surprising, therefore, that a number of us went

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away after 6th May to try to find out rather more about this matter and seek to ascertain why it was so urgent for the Government to take the most unusual step of introducing an amendment with apparently far-reaching implications very late in the passage of a Bill through both Houses of Parliament. Indeed it could hardly be later than the Third Reading.
When we discovered the Government's intention we were even more disconcerted and, indeed, gravely disturbed at what we on this side of the House felt to be an abuse of parliamentary procedures. It transpired that the issue was by no means a new one and not one that in our view needed urgent clarification. There had been previous decisions in line with the Court of Appeal decision, which itself was fully in line with Section 146 of the 1992 Act. That was simply a consolidation of what was in the 1978 Act, which itself consolidated the 1975 Employment Protection Act. Therefore, the provision we are discussing has been established in law for a long time and the Government have had ample time to change it, if they wished to do so, through normal processes. What the Government appeared to be doing was attempting to write into legislation what apparently was a maverick decision of the Employment Appeal Tribunal. In any event, that decision was not unanimous and a member of the tribunal had issued a dissenting opinion.
The Court of Appeal decision which overturned the EAT was, on the other hand, a unanimous judgment. What is at issue here is a matter of the greatest importance. Section 146 of the 1992 Act is a piece of legislation which is fully in accord with the UK's international obligations as a signatory of ILO conventions. It specifies that an employee has the right not to have action short of dismissal taken against him as an individual by his employer for the purpose of preventing or deterring him from being or seeking to become a member of an independent trade union, or penalising him for so doing. As recently as 25th March of this year the Minister spoke with approval of this particular section of the law. He said:
"Secondly, the law already affords protection for individuals whose employer might dismiss or discriminate against them on the grounds of union membership or activities. That protection is a real protection. It applies regardless of the length of time which an employee has been in employment with the employer. An employer does not have a free hand to discriminate against employees who are union members".—[0fficial Report, 25/3/93; col. 472.]
On 25th March the Government were still speaking of that section of legislation with approval. There has been no consultation that I am aware of with any interested parties, certainly not with the TUC, whose members are, of course, likely to be affected by any proposed amendment to Section 146 of the 1992 Act. Therefore, while we are pleased that there is to be recommitment, we wish to place on record in the strongest terms our objections to the procedures followed by the Government with regard to this new clause. We shall have our discussion in Committee and then there will be provision for a Report stage; but that will be held all in one afternoon so that amendments which noble Lords have tabled expecting them to be properly debated on Third Reading, following a Report stage held in the normal manner, will be put back and taken very much later. I deeply
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regret that the Government have decided to go down this path. I had hoped they would not proceed but unfortunately they have done so. I wish to place on record the objections of this side of the House.
Lord Rippon of Hexham: My Lords, I wish to express my own concern at what has happened. Only this morning I received a letter from Mr. Willis, the General Secretary of the TUC. He wrote:
"I am writing to you as the Chairman of the Hansard Society's Commission on the Legislative Process to express the TUC's concern at the Government's decision to move a significant amendment to the Trade Union Reform and Employment Rights Bill at the Third Reading Stage in the House of Lords. I believe the Government's action is an affront to normal Parliamentary procedures and a clear illustration of the need for changes in the legislative process along the lines of the recommendations put forward by the Commission".
I express no views about the merits of the new clause which the Government have proposed but I find it very disturbing that the Court of Appeal should issue its unanimous judgment on 30th April on two cases—I do not know whether there was any question of their going to the House of Lords—and then on 6th May for the noble Viscount to say that he would move an amendment. That amendment was published on 20th May for debate on 24th May. I share the views expressed by Mr. Willis that the hasty response to the judgment was made before anyone had seen the full transcript of the Court of Appeal's ruling and without waiting to see whether either case would proceed to the House of Lords. The amendment was published on Thursday 20th May for Third Reading debate in this Chamber on Monday 24th May. The text of the amendment was not available until the last possible moment before the debate. Although I understand the Government have allowed a separate Committee stage for the amendments today, this cannot be considered an effective parliamentary scrutiny.
Furthermore, there has been no prior consultation with interested parties. I am bound to say I cannot see any justification for legislating in this way. We had a valuable debate last Wednesday on the Salisbury rules and some of the other practices of this House. One of the points that was made not only by the Hansard Society but by a number of your Lordships was that in any event there was usually insufficient time between the various stages of Bills for Members of this House, and certainly those outside, to consider what is happening. This is a rather disturbing example of the way in which we tend to legislate.
Lord Rochester: My Lords, I support the remarks of the noble Baroness, Lady Turner, and the noble Lord, Lord Rippon. I wish to add a few words to what I said last Thursday when the noble Viscount, Lord Ullswater, repeated what he had said on Report; that is, that the recent judgment in the Court of Appeal in two cases had confirmed that the law was giving rise to difficulties and confusion and that it was important for the Government to act quickly to make the law clear. I believe an important principle is at stake here. It is not for the Government but for this House in its judicial capacity to clarify the law if called upon to do so. In introducing this amendment the Government

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are in my view seeking not to clarify but to alter the law to the advantage of employers and the detriment of employees.
Last Thursday the noble Viscount, Lord Ullswater, thanked the noble Baroness, Lady Turner, and myself for our constructive and helpful approach to this matter. The noble Lord the Leader of the House added that he was extremely grateful to us for agreeing —albeit reluctantly—that the course proposed in the government Motion was probably the best way in which to proceed. I am sorry that the noble Lord the Leader of the House is not present. I have told him that it would have been more accurate to say not that we agreed this was the best course but that we felt obliged to acquiesce in the Government's decision. The Government may succeed in forcing through their amendment this afternoon. All we can do is to protest at this position, and that I do most strongly.
Lord Harmar-Nicholls: My Lords, I know that we have no rigid rules in this House which one can be accused of breaching, but I question whether this is the time for this point to be raised. We rely upon self-discipline. That is the only way in which we can make sense of our discussions. We must use our discretion when we raise matters. However, on this particular matter we are not in Committee and we are not in the Report stage. All of a sudden, out of the blue, the noble Baroness, Lady Turner, has raised this issue. I do not know whether she gave notice to my noble friend the Leader of the House that she intended to do so. She has given no chance for anybody who could deal with the matter to be present on the Front Bench.
While it can seem a good publicity ploy to take advantage of the circumstances, it is wrong to misuse the absence of rules so to distort the way we do our business that we do not know where we are. No one can answer my question but, for the record, I want to ask whether this is the correct time for this point to be made when it could properly have been raised when the amendment itself was on the table for discussion. To jump the gun in this way is to twist the procedures of this House in a way which is not in the interests of the House.
Lord Ennals: My Lords, I am sure that we all heard what the noble Lord, Lord Harmar-Nicholls, said. He asked whether this is the right time to discuss the matter. There is no other time when we can raise this point of whether it is right to proceed with the matter now.
I was not present on Thursday. I have only become aware of the situation today. I agree with everything which the noble Lords, Lord Rippon and Lord Rochester, and my noble friend on the Front Bench said.
I must declare an interest. In 1939 I was secretary of my local chapel of the National Union of Journalists. That was some time ago, but I have an interest in the subject and in the views which that union may express about the propriety of the Government's behaviour. I believe that the Government should think again about the matter.
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How can it be proper to rush through such far-reaching legislation without any opportunity for consultation whatever with those who are concerned by it and about it? Like the noble Lord, Lord Rippon, I find the way in which this Government proceed, making decisions on the hoof without consultation, quite intolerable. I have mentioned consultation, but how can the Government expect there to be respect for the law when they seem to defy the due deliberations of three Lords Justices on a point of principle, especially as the case may yet go to the Court of Appeal or to this House? It is quite wrong that the issue should be dealt with in this way.
Having heard strong representations both from our Front Bench and the Liberal Democrat Front Bench I say that in principle this is the wrong thing to do. I plead with the Government to think again before they proceed with what I believe is a very rushed, totally unnecessary and unprincipled action.
Lord Campbell of Alloway: My Lords, for the record, I should like to dissociate myself from the observations made to your Lordships by my noble friend Lord Harmar-Nicholls. I shall assuredly not enter into the merits of the debate. I rise only to deal with the question of the order of debate.
There were two issues which I had to try truly to understand. One was the reasoning of the judgment. I had only half an hour to do so. I need very much more time because the issue goes back over a long period. I shall not go into details, but I need more time, although I am a fairly fast worker. I also wanted to see how the opt-out provisions of the Social Chapter could affect the nature of the amendment. I have not had a moment to consider that aspect.
This is what happens if one proceeds in this way. Of course we shall do the best we can. It is a lovely day and we shall do so with good will. However, there are problems and I merely rise to point out the difficulties which I had in dealing with the matter objectively.
Lord McIntosh of Haringey: My Lords, it is right that we should follow the noble Lord, Lord Campbell of Alloway, particularly on his birthday, on which I congratulate him.
Like other noble Lords, I do not wish to comment on the merits of the Government's amendment or the amendments to it. My noble friend Lady Turner is far better qualified than I to do so. However, I want to respond to what the noble Lord, Lord Harmar-Nicholls, said.
The Motion moved by the noble Viscount, Lord Ullswater, is a debatable Motion. It should be stated clearly to the House that this is not only the right time but the only real opportunity for us to debate whether it is proper for the amendment to be put to this House in this way at Third Reading.
It may be said that we have acquiesced in the procedures. That is the case. I understand that the usual channels have acquiesced in the procedures, and my noble friend Lady Turner confirmed that point. We acquiesced only in the knowledge that it was the firm intention of the Government to push through the amendment come what may. The concession of recommitment to Committee is only a concession to

17
us. It has a certain amount of virtue but, as the noble Lord, Lord Campbell of Alloway, said, not very much virtue because those who are involved deeply with the issues have not had an opportunity to investigate the matter fully.
All Members of your Lordships' House should be clear that it was proper for my noble friend Lady Turner to have risen and to have raised the issue. The propriety of her action has been confirmed by many speakers in this debate.
Lord Howie of Troon: My Lords, I have been approached by two trade unions in relation to this matter. One was the Society of Telecom Executives and the other the National Union of Journalists, of which I have been a member for only 20 years, unlike my noble friend Lord Ennals whose membership goes back further. The significant point which they raised in their approaches to me is that neither union, both of which are greatly concerned with the matter covered by the amendment, has been properly consulted. They have not been consulted at all.
I suggest to the Government that the procedure proposed for this afternoon is outrageous. I do not care whether or not it has been agreed through the usual channels. It remains outrageous, for the following reason. We are expected to discuss a recommittal stage for a time. Then there will be a brief period, during the Statement, in which amendments can be put down for the Report stage. After that there will presumably be a brief period before we move on to the Third Reading, during which no further amendments can be put down. We would normally expect that after Report stage we would be in a position to put down amendments for the Third Reading if that were appropriate.
It may well be that after the Committee stage I shall feel obliged to consult the Society of Telecom Engineers and the National Union of Journalists. I shall have very little time in which to do so. Again, after Report stage I and other colleagues in this House may wish to consult appropriate trade unions or the TUC. We shall have no time to do that.
I should like to suggest to the Government an alternative proposal to the one which is before us today. I suggest that we take the recommitment stage as proposed and then adjourn the House for a period which is long enough to allow proper discussion and consultation to take place. We should then hold the Report stage later. The Third Reading should be abandoned for today and resumed at a later stage next week, the following week or whenever is appropriate. There is no overwhelming urgency about the Bill. I commend my proposal to the Government and I hope that they will listen to it and accept it.
3.30 p.m.
Earl Russell: My Lords, I cannot help thinking that the point made by the noble Lord, Lord Harmar-Nicholls, about the flexibility of procedure turns back upon him. The ability to introduce amendments at Third Reading has distinguished this House from another place for approximately 350 years at the least.
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However, like other privileges of this House, that privilege depends for its enjoyment upon continued self-restraint. In the light of our agenda after the Whitsun Recess, I cannot help wondering whether this is precisely the moment for the Government to set an example of breaking that self-restraint. That view may not be universally shared in the Department of Employment but I would imagine that it is widely shared on the Government Front Bench in this House.
Speaking for a moment purely personally, I cannot help expressing regret that at precisely the moment when I am about to set out with the Government on a long route-march they choose to shoot themselves in the foot. I am in full agreement with what has been said by the noble Baroness, Lady Turner, the noble Lord, Lord Rippon of Hexham, the noble Lord, Lord Campbell of Alloway, and the noble Lord, Lord Rochester, on my own Front Bench. I am in particular agreement with the noble Lord, Lord Rochester. I am not yet convinced that there is so much doubt and confusion in the law that it is urgently in need of clarification.
I am more convinced by the remark of Mr. Clarke, counsel for Palmer in Palmer v. Associated British Ports, in one of the cases which the Government propose to reverse. At page 24E of the transcript he stated:
"It is a simple enough case for a junior. I am sure their Lordships do not need to be troubled".
With that opinion I agree.
Viscount Ullswater: My Lords, I am sorry that the noble Baroness, Lady Turner, was indisposed last Thursday and obviously unable to make her comments on the recommitment proposal that I made on that date. I understand that she wishes to have her remarks today on the record. Of course, the noble Baroness is quite right. I gave notice on 6th May at col. 860 of the Official Report of our intention to move the amendment during the Report stage of the Bill. As I said at the time —and I may be repeating myself, as the noble Lord, Lord Rochester, said—the Government's purpose is to clarify the effect of the law in this area. The recent judgments of the Court of Appeal in two cases have confirmed that the law is giving rise to difficulties and confusion. The present position is unsatisfactory and it is important that we should act quickly to make the law clear.
It is clear from the decisions of the Employment Appeal Tribunal and the judgments of the Court of Appeal that the law is giving rise to considerable difficulties. I believe it is right that we should take this opportunity, while the Trade Union Reform and Employment Rights Bill is before Parliament, to clarify the law in that area.
It is not the case that the Government are simply reacting instantly to the Court of Appeal judgment. My noble friend Lord Rippon was not making a comment on the amendment itself but on the speed of introducing the amendment. We have been aware for some time that Section 146 has been causing difficulties for the industrial tribunals and Employment Appeal Tribunals. We have been keeping the matter under close review. However, it is true to say that the Court of Appeal judgments were

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not in line with what the Government had expected and certainly not with the Government's intention as to the way in which the law should operate in that area. In the circumstances, we believe that it is right to bring forward an amendment now. Obviously when we discuss the amendment I shall be able to quote the words of the noble Lord, Lord Jacques, who introduced the provision and to indicate why we believe that the amendment is a clarification. From what the noble Lord said when he introduced the provision in 1975 it is quite clear that what we are doing today is purely clarifying the law.
Noble Lords: Oh!
Lord Ennals: My Lords, I am most grateful to the noble Viscount for allowing me to intervene. Is he saying that the matter has been of some concern to the department for some time? If that is so, why was not the amendment brought forward earlier?
Is it right to assume that the Government decided to bring the amendment forward when they did not like a decision by the Court?
Viscount Ullswater: My Lords, it is a rather complicated area. The industrial tribunals found one way; the Employment Appeal Tribunal found another, which was in line with Government thinking. However, it gave leave to appeal. It said that there are difficulties in this area of the law. As the law stood, at that moment obviously the law supported the line that the Government took. I believe that the noble Lord would understand that. However, when the Court of Appeal judgment was released only a few days ago it acted in the opposite way. Having been aware of the inconsistencies in the law—and they were pointed out to us—at that moment we sought to make this amendment while the Bill was before Parliament.
Lord Wedderburn of Charlton: My Lords, I am grateful to the noble Viscount for allowing me to intervene. I ask the question in order to speed up our debates if they are to go ahead. He has often said that the Government needed to clarify the judgments of the Court of Appeal. Either now or before substantive debate, will he give us a reference to pages or paragraphs in the Court of Appeal judgment which are unclear so far as concerns principle? Will he also give references to the industrial tribunal decisions and the EAT decisions—for the first time he states that they exist—which have thrown doubt on the law? It is not the mere fact that one court reverses the decision of another; that happens every day. If the Government legislated every time the Court of Appeal did so, we should be debating night and day.
Will the noble Viscount also state that if he goes ahead with the substantive debate he is able, and has the authority, to consider any amendments put to the Government; and that if they are difficult amendments to accept, that he can adjourn the House when necessary in order that proper consideration can be given not by noble Lords on this side of the Chamber but by the Government?
Viscount Ullswater: My Lords, the noble Lord asks me to go into some detail. Perhaps I may quote from an extract of the EAT judgment. It states:
"Section 23(1) (a)"—
that is the section under the 1978 consolidated Act—
"has caused and may well continue to cause problems. We will give leave to appeal and would welcome guidance. We share the difficulties which this Industrial Tribunal found in the wording of S.23(1) (a)".
It continued:
"For the reasons we have given therefore the appeal is allowed and the Originating Application of each of these complaints must be dismissed. Leave to appeal".
I have sought to answer the noble Lord, Lord Wedderburn, on my feet. I should prefer to do so when we speak to the amendment.
However, in answer to the noble Lord, Lord Howie of Troon, I do not believe that it is necessary or desirable to delay the passage of the Bill. We are providing through this Motion an opportunity for the House to consider the amendment in detail on recommitment. It will obviously be discussed in another place. We have tabled the new clause as soon as possible to allow time for any further amendments to be tabled. Amendments have been tabled. The remainder of the Bill has received very thorough consideration by your Lordships. I believe it reasonable in the circumstances for the House to proceed to Third Reading of the Bill on this day.
Lord Howie of Troon: My Lords, the noble Viscount has been very considerate over interventions. Will he comment on my suggestion that the Third Reading should be postponed? As the noble Earl, Lord Russell, pointed out, it has been the custom to put down Motions in this House at Third Reading for a very long time. It may well be that the need for further amendment between Report stage and Third Reading could arise from our debates today. However, as yet there is apparently no opportunity for that. I suggested—I sought to help the Government —that the Third Reading be postponed until another day so that adequate consultation and consideration of further amendments at Third Reading should take place.
Viscount Ullswater: My Lords, of course these matters have been discussed with the usual channels. We do not come to the Dispatch Box to propose something that has not already been discussed and agreed between ourselves and the Opposition. I sought to explain why I felt it was perfectly reasonable to go through to Third Reading. The remainder of the Bill has been discussed in some detail.
I recognise that if we were to deal with the amendment proposed on Third Reading it would restrict the scope for debate. I agree that it is important for your Lordships to have the opportunity to debate the amendment thoroughly. I also agree with my noble friend Lord Harmar-Nicholls that we want to get on with the debate in order to have a proper discussion. That is why the Government tabled the Motion providing for the Recommitment of this part of the Bill. I commend the Motion.
Lord McCarthy: My Lords, before the noble Viscount sits down, he was kind enough to say that he intends to quote from the speech which the noble Lord, Lord Jacques, made in 1976. So that we may take care and follow precisely what he says, will the noble Viscount now cite the reference so that we may look it up?
Lord Hailsham of Saint Marylebone: My Lords, perhaps I may make a humble suggestion. We are where we are now. There is obviously criticism of the Government. The noble Baroness, Lady Turner, and others have made that plain and stated their objection. However, every prolongation of this part of the debate will be at the expense of the substantive discussion and will make matters worse. Should we not get on with it?
Lord Jenkins of Putney: My Lords, is not that suggestion in itself rather damaging to what we are trying to discuss? If one gets on with it, one accepts it. What people like myself, who come to the matter afresh, want to know is: why are we in this situation? The usual channels who acquiesced in this obviously have doubts as to whether what they did was right. They were not happy about it, otherwise there would have been no debate. They tell us that they agreed to go along with this arrangement in order to facilitate the Government. Those who come to the matter afresh are faced with a situation which we had no reason to expect. This is an unusual procedure and if we accept the proposition of the noble and learned Lord, Lord Hailsham, we shall be accepting that we go ahead with a discussion which those of us who come to the matter afresh feel ought not to take place in the way proposed on the Order Paper. For that reason, I take the view which has been most widely expressed; that some arrangement should be made so that the matter can be examined in greater detail than is presently proposed.
Viscount Ullswater: My Lords, I look forward to seeing the noble Lord, Lord Jenkins, taking part in our debate this afternoon. He has not done so to date, but I look forward to his contribution.
In order to help the noble Lord, Lord McCarthy, I shall cite the reference for the quotation for which he asked. It is from Hansard, 23rd September 1975, col. 189 and subsequent columns.
On Question, Motion agreed to.
House in Committee (on Recommitment) accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Viscount Ullswater Viscount Ullswater moved Amendment No. 1:
Before Clause 13, insert the following new clause:
Action short of dismissal: non-infringing actions
(". In section 148 of the 1992 Act (consideration of complaint of action short of dismissal), after subsection (2) there shall be inserted—
"(3) In determining what was the purpose for which action was taken by the employer against the complainant in a case where—

(a) there is evidence that the employer's purpose was to further a change in his relationship with all or any class of his employees, and

(b) there is also evidence that his purpose was one falling within section 146,

22
the tribunal shall regard the purpose mentioned in paragraph (a) (and not the purpose mentioned in paragraph (b)) as the purpose for which the employer took the action, unless it considers that the action was such as no reasonable employer would take having regard to the purpose mentioned in paragraph (a).
(4) Where the action which the tribunal determines to have been the action taken against the complainant was action taken in consequence of previous action by the employer paragraph (a) of subsection (3) is satisfied if the purpose mentioned in that paragraph was the purpose of the previous action.
(5) In subsection (3) "class", in relation to an employer and his employees, means those employed at a particular place of work, those employees of a particular grade, category or description or those of a particular grade, category or description employed at a particular place of work.".").
The noble Viscount said: In moving the amendment that stands in my name I am aware that it has already been the subject of a certain amount of controversy. I have to say that a little of it even surfaced today. I am pleased, therefore, that we have been able to resolve into Committee once again this afternoon so that the issues may be debated fully, without the constraints that would apply at Third Reading.
I believe that it will be helpful to our deliberations this afternoon if I set out the background to the tabling of this amendment and, in particular, details of the recent Court of Appeal cases that have pointed to the need for clarification of the law.
The law on action short of dismissal has, since we consolidated industrial relations law last year, been contained in Section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992. In broad terms, it provides protection for the individual against action taken against him by his employer for the purpose of deterring or compelling trade union membership. It offers protection for the individual trade union member (or non-trade union member) against victimisation at work by his employer.
The recent Court of Appeal cases which have persuaded the Government that the amendment before us today is necessary arose before the law in this area was consolidated and when it was contained in Section 23 of the Employment Protection (Consolidation) Act 1978. The law itself was exactly as it is today.
In these related cases, two separate employers, Associated Newspapers and Associated British Ports, decided that they wanted to alter the way in which they negotiated with their workforce. Instead of maintaining collective bargaining arrangements they wanted to de-recognise the union in question and move to a system of personal contracts. It is, of course, the employer's right to decide exactly how he wants to negotiate with his staff. After all, no one but the employer in question can know all the relevant circumstances and can decide what is best for his business. It has always been this Government's policy to ensure that employers have the freedom to act in this way.
In these cases, in order to persuade their employees to accept new personal contracts of employment, the employers offered them a financial inducement to sign. In effect, those who signed the new contract received

23
a pay rise, and those who refused did not. The employers believed, as did many of those who have followed these cases, that there was nothing unlawful in their actions. They made a business decision about their future method of negotiation with staff and took appropriate action to implement it. They have maintained throughout that they had no interest in whether or not their employees were members of the formerly recognised union or any other union. They have certainly not sought to prevent their employees continuing to be members of a union—which would indeed have been unlawful. Their interest and their action related to the conduct of their own relationship with their employees.
Nonetheless, cases were brought under what is now Section 146. In each case, the industrial tribunal found that the employer had contravened Section 146, but that finding was reversed by the Employment Appeal Tribunal. The EAT's rulings were, I have to say and have said, in line with what the Government had expected, and applied the law in the way in which we had understood it would operate. However, only a few weeks ago, the Court of Appeal found that the employer had acted unlawfully in both cases.
These cases have proved difficult to resolve, and this area of law is now in a state of confusion because, it seems, of the way that Section 146 is formulated. The section protects against action taken against the individual for the purpose of compelling or deterring trade union membership. Our understanding is, and always has been, that this means that in broad terms an employer is prevented from victimising individual trade union members or non-trade union members. The provisions were not intended to apply in a situation where an employer takes a particular action in order to achieve an organisational or strategic purpose, and where that action may incidentally have negative side effects for certain people who are, or are not, trade union members.
Thus, it seems to us that Section 146 should not have applied in the Associated Newspapers and Associated British Ports cases. The fact that it has successfully been argued that it does indicates that the law is unclear and that it is not achieving the purpose for which it was intended. We have therefore brought forward this amendment.
It may be helpful to your Lordships if I set out in a little more detail exactly how Section 146 was originally intended to operate. The law in its current form was first introduced by the Labour Government in 1975. To illustrate the intentions that lay behind that legislation I can do no better than to quote the noble Lord, Lord Jacques, who took the relevant legislation through your Lordships' House. In doing so he emphasised that the clause:
"deals with individual rights of employees, not collective bargaining issues."—[Official Report, 23/9/75; col. 189.]
He went on to explain:
"a prohibited action must be for the purpose of prevention, deterrence or penalisation. Actions aimed at other purposes, such as helping recognised unions, which have the incidental effect of restricting some employee's rights comparatively, do not infringe these rights."—[col. 192.]
When the law on action short of dismissal was amended in 1982 these intentions were unchanged. My noble friend Lord Ferrers explained the position to your Lordships' House in these words:
"Clearly, it would be unfair if an employee were, for instance, to have taken away from him his company car because he was not a member of a trade union … but it would not be unfair to have a differentiation between rates of pay …" —[Official Report, 28/7/82; col. 331.]
As noble Lords will see, from its earliest days, and under different governments, the intention behind the section has been to protect against individual acts of discrimination, and not to confuse those with collective bargaining issues.
I hope that the Committee will forgive that lengthy preamble to my description of what the amendment actually does, but I thought that it would assist our deliberations this afternoon to have this information about the context in which I am bringing forward this amendment.
The amendment clarifies for the benefit of tribunals and courts the way in which an employer's purpose should be determined in cases such as those which have occurred most recently. It provides for the situation where a case comes to a tribunal and the employer and the individual put different arguments about the employer's purpose in taking a particular action. Where it is argued, on the one hand, that the employer's purpose was to bring about a change in how he conducts his relationship with his employees (that is to say, his bargaining arrangements) and, on the other hand, that his purpose was a purpose falling within Section 146, then the tribunal is to take the bargaining purpose as the relevant purpose. However, the tribunal must always have regard to the reasonableness of the action taken. If the action is,
"such as no reasonable employer would take"
in the circumstances, then the tribunal will still be able to decide that the action amounts to action short of dismissal in the terms of Section 146.
The effect of the amendment will be to restore the proper distinction in Section 146 between individual and collective matters. Section 146 will continue to give individuals important protection against victimisation because of their trade union membership or non-membership, but it will not prevent employers from making and implementing legitimate decisions about how they wish to negotiate with their employees.
We should not exaggerate the effect of this amendment, which does no more than clarify this particular area of the law. It will apply only in a particular set of circumstances, such as those that arose in connection with the recent cases which I have described. Only where an employer wishes to bring about a change in the way he conducts his relationship with his employees and in order to do so takes action which is argued to be action in contravention of Section 146 will the amendment come into play; and only then if the action is reasonable in the circumstances. It is an important amendment, but it does not amount to a fundamental change in the law. Indeed, as I have argued, the Government believe that it does no more than ensure that the law is applied in the way that had always been intended.
There is a further important point that I should like to make clear about the effect of this amendment. It arises from a question which the noble Lord, Lord Rochester, raised during the brief debate on the Government's Recommitment Motion last Thursday. The noble Lord said (reported in Hansard on 20th May, cols. 1857–58) that his understanding was that the new clause would not affect either of the two cases covered by the Court of Appeal's recent judgments, nor indeed any others which may be awaiting hearing by an industrial tribunal. He asked me to confirm that that was the case.
I thought it right to deal with this matter in introducing the new clause. I can indeed confirm that the noble Lord's understanding is entirely correct. The amendment would not take effect until after the Act receives Royal Assent and this particular provision has been commenced. That means that any existing cases currently before the courts or the tribunals—and, indeed, any cases which concern action taken before the new clause comes into effect—would fall to be decided under the law as it currently stands. As I have made clear, the Government believe that the amendment will simply ensure that the law operates as had always been intended. Nevertheless, it would clearly be wrong to attempt to make the amendment apply retrospectively, and I am happy to give the House reassurance on that point.
Moreover, it should not go unremarked that the amendment will not apply solely in situations where an employer's purpose is to de-recognise a trade union—such a narrow amendment could hardly, after all, be described as clarifying the law. The amendment provides that in any situation where an employer wants to change his negotiating arrangements and takes reasonable action to bring about that change he will not be acting in contravention of Section 146.
Before concluding, I should like to take up a point about which I know that the noble Lord, Lord Blease, is concerned. I understand that he is unable to be present today, but for clarification I confirm to the House that the provisions contained in this new clause will not he among the provisions extended to Northern Ireland by Clause 53.
In conclusion, a government's duty is to bring forward legislation to implement the policies on which they were elected, and to keep a watchful eye to ensure that legislation continues to achieve the purpose for which it was made. Recent events have made it clear that Section 146 has ceased in certain cases to achieve its intended purpose. The purpose of the amendment before the Committee is to put that right. I beg to move.
Baroness Turner of Camden Baroness Turner of Camden moved, as an amendment to Amendment No. 1, Amendment No. 2:
Line 6, leave out ("further a") and insert ("negotiate an agreed").
The noble Baroness said: The object of this amendment is to insert into the new clause the requirement that the employer should negotiate and agree with his employees any
"change in his relationship with all or any class"
of them. If unamended in that way, or in one of the ways later to be suggested by my noble friends, the
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new clause would have the effect, in my view, of totally undermining the protection afforded to employees by Section 146 of the 1992 Act. As we have seen, Section 146(1) (a) states that,
"An employee has the right not to have action short of dismissal taken against him as an individual by his employer for the purpose of—
(a) preventing or deterring him"—
and I emphasise that point—
"from being or seeking to become a member of an independent trade union, or penalising him for doing so".
Of course it is about individuals. We have never argued that it was about collective rights.
This is not a new provision, as I said earlier. It appears in the Act of 1978 in exactly the same wording, and, as the Minister himself has agreed, in the Employment Protection Act of 1975. I again say to the Minister that if the Government thought there was a need for so-called clarification, there has been ample opportunity for doing so, certainly before this afternoon on the final stages of a major Bill. Furthermore, the decision to take this course was apparently taken following the Court of Appeal judgment on 30th April and, as we all know, before the full transcript was available.
As we have seen, the cases before the Court of Appeal—Wilson v. Associated Newspapers and Associated British Ports v. Palmer—concern the denial of pay increases to employees who refused to sign personal contracts which required them to relinquish trade union representation. In both cases the industrial tribunal decided that offering financial inducements in that way constituted action short of dismissal on grounds related to union membership activities. The EAT, as the Minister has explained, overturned those verdicts, again by a majority decision—a member of the EAT dissented. The Court of Appeal ruled that the employer's actions amounted to unlawful discrimination under Section 146 of the 1992 Act. As I said earlier, in my view the maverick decision is that of the EAT. The Court of Appeal seems to have followed precedent set in other cases. The Court of Appeal judgment refers specifically to the cases of the National Coal Board v. Ridgway and Discount Tobacco and Confectionery Ltd. v. Armitage. Here we have the Government seeking an amendment which would appear to support the EAT as against the Court of Appeal and previous precedents. It does not seem to me to be a case for clarification. If one is talking about clarification, just look at the wording of this amendment! Perhaps I may read subsection (4) of the proposed new clause:
"Where the action which the tribunal determines to have been the action taken against the complainant was action taken in consequence of previous action by the employer paragraph (a) of subsection (3) is satisfied if the purpose mentioned in that paragraph was the purpose of the previous action".
If that is clarification, I really am very surprised. I wait to hear the Minister explain to us precisely what that means.
In his judgment Lord Justice Dillon states that he had no doubt that the purpose of Associated British Ports in offering extra pay to those employees who signed the new personal contracts was to persuade

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employees to abandon union representation by making personal contracts so attractive that, as it was put by the dissenting member of the EAT,
"the union would wither on the vine".
It was claimed that although some employees had accepted the offer of a personal contract, they could have remained members of the union.
However, Lord Justice Dillon referred to the case of Discount Tobacco and Confectionery Ltd. v. Mrs. Armitage. In that case, the employee was dismissed by her employers after she had consulted a union official about the terms of her contract of employment and the union official had written a letter to her employers on her behalf about the terms of the contract. The industrial tribunal held that she had been dismissed because of her union membership. The employer's appeal to the EAT said that there was a distinction to be drawn between membership of a union on the one hand and resorting to the services of the union on the other. That argument was dismissed.
There is no need for that kind of clarification. The Court of Appeal judgment seems very clear. If the clause now suggested by the Government is incorporated into the Bill, it is likely to lead to much more confusion. Employers will imagine that the type of actions embarked upon by Associated Newspapers and Associated British Ports are now legitimate, and that it is open to them to end collective bargaining and offer bribes in the shape of higher salaries to individuals who will opt for personal contracts and will agree to forgo union representation. It will not be very long before that is being widely interpreted as legitimising pressure for people to leave the union altogether.
If our amendment were accepted, it would at least bind the employer to negotiate any changes in his structural relationships and to agree them with the employees so affected instead of simply imposing them. That would be some small amelioration in a totally unsatisfactory and indeed totally objectionable clause. I beg to move.
4 p.m.
Lord Rochester: Earlier this afternoon the noble Viscount, Lord Ullswater, said that the Government had had this matter under consideration for some time and that they were surprised by the Court of Appeal judgment overturning the judgments of the Employment Appeal Tribunal which they had thought represented the existing law. But the Court of Appeal judgments were consistent with earlier industrial tribunal findings. I believe the point has already been made this afternoon that it seems odd, to say the least, that it has taken 15 years (since the passing of the 1978 Employment Protection (Consolidation) Act on which the present law depends) for the Government to find that there is need for this amending legislation.
In debates in Committee and on Report, my noble friends and I felt that the effect of the Bill in a number of ways was to undermine what might be called the
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raison d'Être, of trade unionism; namely, the right of people to combine together and ultimately, if the need arises, to withdraw their labour.
In our view, good industrial relations depend on there being a reasonable balance between management and employee representatives. But if instead of legislation being even-handed in its application, the process is weighted at every turn—as it has been in this Bill—in favour of the employer, not only individual freedom but ultimately this country's economic performance will suffer.
Accordingly, the question we have to ask is: what is the Government's real aim in introducing such an amendment into the Bill? I am sorry to have to say it, but feel that I must: is it so to weaken trade unions that they will eventually be driven out of existence? In our view, trade unions are an essential part of a free society—look at the countries in which they no longer exist—and a free society dismantles them at its peril.
We are told in this amendment that where there is a conflict between the employer's purpose no longer to recognise a trade union—a purpose which he is already at liberty to pursue—and the right of an employee not to have action short of dismissal taken against him by his employer to deter him from being the union member, it is the purpose no longer to recognise the union which is to prevail. It is true that subsection (3) (b) states that the action of the employer must not be:
"such as no reasonable employer would take having regard to the purpose"—
which is, not to recognise the union.
There are several comments to be made on that. First, once more it will fall to lawyers to argue among themselves, this time as to what is meant by the term "reasonable employer". I hope that tribunals will conclude that an employer who, as in the recent Court of Appeal cases, grants significant pay rises to employees who accept personal contracts but not to those who choose to remain union members is not a reasonable employer. But I fear that in moving the amendment the Government consider that if the new legislation had applied in those two cases (the Minister has practically said so), the actions of the employers concerned would have been held to be within the law. Otherwise, I do not see why the Government would want to amend the law as they are doing.
In other and cruder words, it seems that under this Government we have now reached the position that in future there will be nothing to stop employers who are so inclined from offering sweeteners—or bribes; let us not mince words—to employees to induce them to leave their union. I find that offensive. I hope that the Committee will, too. I am glad on that basis to support the amendment moved by the noble Baroness, Lady Turner, which at least goes a little way to mitigating the effects of the government amendment.
Lord Campbell of Alloway: The question with which the Committee is concerned on both the amendments can be put quite simply. I want to make a simple speech because this is a very complex subject. It might be helpful to leave the legal technicalities to the noble Lords, Lord Wedderburn and Lord McCarthy, and the noble Baroness, Lady Turner,

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from whom we have already heard some of them put extremely well. It will be found in five lines on page 22 of the judgment:
"this decision does not dispute an employer's right to de-recognise a union and make changes in consequence in the terms and conditions of the employee's employment. The employer only enters a potential danger area if he offers a douceur"—
the bribe, as it was called by the noble Lord, Lord Rochester—
"to employees who will support his policy, which is to be withheld from those who are not prepared to support it".
In five lines, that is the question.
Leaving aside the complex reasoning of the judgment, which I have not been able to assimilate, and the technical legal questions of statutory interpretation as to action short of dismissal, the cases on it and unlawful discrimination, the question is simply whether an employer has a right to derecognise a union. That is not in dispute; it is whether, in implementation of that policy, the employer may offer increased wages to those who accept and withhold from those who refuse. To be quite frank, I cannot see the difference, which my noble friend Lord Ferrers sees, between a car and wages. But there it is. Reading the judgment, perhaps this all but incomprehensible maze of statutory provision is overripe for total reclarification not only concerning this question.
The proposed amendment has to be seen in fair perspective. As I read it, subject to correction, it would not preclude the courts from reaching precisely the same decision as that reached by the Court of Appeal if, as the Court of Appeal held (but not in terms), no reasonable employer—having regard to the purpose mentioned in paragraph (a) and the tailpiece to paragraphs (a) and (b)—would have taken such action. It is little different from the reasoning of the Court of Appeal.
The Committee may feel that the proposed amendment provides an alternative avenue by which the decision of the Court of Appeal could be upheld in similar circumstances. I agree with the Minister that in that sense the clause makes no fundamental change. It follows that to some degree it serves as an aid to the clarification of this complex statutory provision, in the light of contradictory decisions which have taken three years to reach the Court of Appeal and, for all one knows, may be on their way to the Appellate Committee of your Lordships' House.
We have to look at the fundamental principle behind the amendment. Both the proposed amendment and the Government's attitude are a reflection of fundamental government policy —affirmed by the Minister today at the Dispatch Box—that employers should be free to decide whether to accord recognition to a trade union, and that the setting up of recognition machinery is wholly unacceptable. If such is the policy, then, if an employer is free to recognise; or not to recognise; to implement a "no-strike" clause; or to conclude a single union agreement; surely he must also be free to seek to induce the non-union representation as proposed by the amendment subject to some proposed safeguard.
In regard to the safeguard proposed, this is not the first time that the noble Lord, Lord Rochester, and I,
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without any form of consultation, have held the same type of reservations. It is apparently an objective standard for the decision of the tribunal and the courts on the evidence adduced. It may not be entirely satisfactory. What is the action which no reasonable employer would take? Is it rather like the elephant which one recognises when one sees it, but which belies any easy definition?
While the fundamental policy of government remains in place, I simply do not understand what useful purpose can be served by opposing the amendment. On many occasions, I have sought in vain to persuade the Government to change their policy. The Government have set their face against any form of statutory framework for recognition machinery. It must be fairly conceded that neither I, the noble Baroness, Lady Turner of Camden, the TUC nor anyone else so far as I am aware, have been able to devise any satisfactory framework. It is not a simple problem. None of us, in our cross-party discussions which we have at times, indicated that we wanted to go back to the relevant provisions of the Act of 1971 which were lifted piecemeal from the Barbara Castle industrial relations Bill.
Nonetheless, before too long the day must come—and it surely will—when recognition procedures, worker participation, inducements to avoid trade union representation with which we are concerned today and other aspects of our domestic law of industrial relations, with or without the Maastricht opt-out clause (which I have not been able to study sufficiently for this purpose), will receive consideration from the Court of Justice and the European Court of Human Rights. I wholly support the Government in the view that our domestic law requires clarification in this context. It is of course subject to supranational law, according to the jurisdiction that we have conferred on those courts.
The sovereignty of Parliament to introduce amending legislation of this order is not in question. But the implementation of that legislation can be called into question. If the Government are dissatisfied with the decision of the judiciary, they retain the sovereign right to strike down the decision by amending the legislation. Perhaps the most notable example in that sphere was the Taff Vale case.
As members of the European Community, our sovereignty to implement domestic legislation is now qualified. I am grateful to the Minister for making it patently clear that the legislation cannot affect any position that arose prior to Royal Assent. In conclusion—at all events, until Maastricht has cleared our parliamentary hurdle, as affording a step in an ongoing process of negotiation and while the fundamental policy of government as regards recognition remains as it is, in place—it would be pointless and perhaps even premature to oppose the Government on Amendment No. 1.
Lord Wedderburn of Charlton: I follow the noble Lord, Lord Campbell of Alloway, partly because he was the first to recite in full to your Lordships a passage from the judgment, and to do so with great effect. Amendment No. 2 points to a crucial area of the Government's amendment which poses the

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question whether an employer under the Government's regime would be able to force through, without any negotiation with anyone, changes in the employment relationship and so wipe out whatever was the area of his intent or purpose to indulge in trade union cleansing.
Faced with that, the Government retreat with what they call "uncertainty". All that they have shown is that they like the decision of the Employment Appeal Tribunal but not that of the Court of Appeal. Governments and others frequently find themselves in that position. I fully share the view of the noble Lord, Lord Campbell of Alloway, that the Government should have the right to legislate in face of that. But they should have read the judgment properly before doing so. With great respect, even our debates so far show that the Government have not done so. They should have stopped the amendment in its tracks, gone away and thought again.
I refer especially to page 22 of the judgment, which the noble Lord, Lord Campbell of Alloway, cited, both in respect of the Court of Appeal's insistence that its decision and the decisions of industrial tribunals in the future in this area would rest upon the balance of the evidence—not as under the Government's amendment, where one piece of evidence can wipe out another piece of evidence, but on the evidence as a whole. That is the first of three points on the judgment. Secondly, Lord Justice Dillon—I cite this again in quotes in order that the Minister should take account of it and reconsider his briefs on the question—said that,
"this decision does not dispute an employer's right to de-recognise a union"—
I interpolate "collective rights"—
"and make changes in consequence in the terms and conditions of the employee's employment. The employer only enters a potential danger area if he offers a douceur to employees who will support his policy, which is to be withheld from those who are not prepared to support it".
The Court of Appeal there is in direct accord with the only piece of evidence that the Government have cited so far concerning the intent and clarity of this section. Section 146 goes back to 1975 in precisely the same terms and, as the noble Lord, Lord Campbell, rightly said it goes back really to 1971. Although Section 5 of the Industrial Relations Act 1971 was rather different in some respects, nevertheless the broad thrust of it—that the employer should not deter or penalise an employee from becoming a member of a trade union—was the same. Indeed, this is an area which up to now, since 1971, give or take the terms precisely, has been, oddly enough, an area of bipartisanship. No one has thought fit to knock out the right to be a trade union member or to so pose it against the employer's rights that the employer can knock it out when he likes. That, of course, is the reality of the Government's amendment. And if the Government refuse and reject my noble friend's amendment, the employer will not be required to negotiate with anyone, not even individually.
But the noble Lord, Lord Jacques, in 1975, in introducing the Labour Government's clause, drew a distinction between rights, as the Minister said, which
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the worker holds as an individual and collective rights concerning recognition or collective bargaining. If one goes to the bottom paragraph of page 22 of the judgment one finds that distinction set out yet again as an obvious statement of law. There is no uncertainty. I have consulted a large number of brethren and, I hasten to add, sisters in the practising profession over the past few days since we had sight of the Government's amendment. They are not all in agreement with me on policy but I did not find one who rejected the concept that this is a new departure. The noble Lord, Lord Jacques, will not work for the Government because he stated something with which we all agree, as does the Court of Appeal. Can the noble Viscount cite a book? Can he cite an article or a commentary—or even a footnote—which suggests that this section should be interpreted in a way other than that in which the Court of Appeal interpreted it?
It was the Employment Appeal Tribunal which was the novelty. Mr. Justice Wood, rather carefully on the facts, did two things; first, he said that he decided this on the special facts of the case; but secondly, he said, at a vital point of the judgment concerned with the law in the Employment Appeal Tribunal, that it would be nice to have the guidance of a higher court on the matter, which is a sign of uncertainty. If one goes to the Court of Appeal judgments, with the orthodox long-standing interpretation, there is no uncertainty there. Of course, I do not guarantee that the Judicial Committee of this House will not form either view or even a third view. I cannot insure your Lordships against that. But there is no literature suggesting that there is any uncertainty; or if there is, will the Minister please cite it?
What there is is a government decisicn—on the evidence it seems to be a pretty recent government decision; on the evidence perhaps not through the processes of the Department of Employment. One does the Department of Employment the compliment of thinking that it would have longer consideration of matters within its direct purview. On the evidence it seems possible—though this is speculation—that someone in a huff, having lost in court, got in touch with someone higher up, and someone higher up said, "This has got to go". So of course when the noble Viscount came to announce the decision he did not cite—with great respect to him, he does not cite now —the Court of Appeal judgment properly.
The other issue involved is precisely the individual right issue. The international standard—we shall be coming to international standards in some of our later amendments—is quite clear. It is laid down by the International Labour Organisation conventions, by the Council of Europe social charter and by the United Nations international covenants. It has been clear since 1948 with the ILO freedom of association convention, with the 1949 right to organise and collective bargaining convention and also with the European Convention on Human Rights, as that is an instrument on which it appears the Government place greater weight, although they have ratified and still accept theoretically all the rest.
What do these instruments say—that there should be freedom of association not in an abstract sense; not

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in a sense of simply having the right to hold a party card and going to work and then being penalised. Anyone concerned with international comparative labour law would laugh at any such idea. The extent of the protection is a matter for application. It was in decisions such as National Coal Board v. Ridgway in 1987 in the Court of Appeal that the Court of Appeal insisted that this was a protection only for individuals. In the case of Discount Tobacco and Confectionery Ltd. v. Armitage in 1990, Mr. Justice Knox held that it went a little further than the right to have a union card. A union card yes, but what should happen when a worker required a local official to help him or her—it was "her" in that case? Yes, said Mr. Justice Knox, having the local official to help is part of being a member.
The Minister seemed to cite the case of Discount Tobacco and Confectionery Ltd. v. Armitage as though it was to do with collective bargaining. It has nothing to do with collective bargaining. It is to do with grievances. The noble Viscount says that he did not. I apologise to him. I am sure in that case that he did not. It was someone else, Someone else cited it in that way. The Minister agrees with me that they were wrong. What was being discussed was the individual right to have the help of a local official in certain circumstances on an individual matter. It is by no means certain. Mr. Justice Knox held that that right was the outward and visible manifestation of union membership and formed part of the right not to be penalised by the employer for doing it.
In those circumstances, if the Government are really going to come forward with this novel piece of law, they must understand that they are undercutting every other norm, not merely of our past law but also of international comparative labour law as well. Not every country abides by its obligations. One can go to the ILO Committee of Experts' reports and find examples. This country has been one of the examples in other areas. It grieves me and makes me sad to see this country being rushed at six days' notice—72 hours' working notice—into a new law which will form another passage in the Committee of Experts of the ILO. If the Government want this, could they not show that they have some understanding of the power relationship on the office floor and the factory floor by accepting that before the employer is put into this driving seat he must at least put forward a little evidence of negotiating with the people who are now to be in his power?
Lord Moyne: My worry about the Government's proposal does not refer to the comparison with international norms so much as the comparison with their own policy. In the Government's legislation over the past 10 years or more it has been established—and quite rightly established—that it is the individual's right not to belong to a trade union. Surely that implies that it is also an individual's right to belong to a trade union
Earl Russell: I should like to thank the noble Viscount for the care he has taken to make the Court of Appeal transcript available to us and for his care to
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make the text of the amendment available to us before the weekend. In all the dissatisfaction I have expressed about the procedure I have not for a minute criticised or intended to criticise the courtesy with which the noble Viscount personally has conducted it. Nevertheless, the point remains that at short notice I must speak more speculatively about the meaning of this amendment than I would otherwise have wished. The point has been made many times by the noble Lords, Lord Renton and Lord Rippon of Hexham, and the noble and learned Lord, Lord Simon of Glaisdale, that rushed and hasty legislation does not always achieve its desired effect. The noble Viscount told us that this amendment did not achieve a fundamental change in the law. Before listening with great interest to the noble Lord, Lord Campbell of Alloway, I felt that perhaps the noble Viscount was speaking rather truer than he knew. Purpose tests in court often cause difficulty. Some of us may remember the cases that used to arise under Section 2 of the Official Secrets Act 1911 involving a purpose prejudicial to the safety of the state. It was sometimes very difficult to decide whether or not a purpose was prejudicial to the safety of the state.
The amendment before us asks us to distinguish between two purposes. In theory and in principle it is perfectly possible for such a distinction to be made and to stand up. The question that causes me doubt is whether, on the facts of an individual case, the court will see two separable and distinguishable purposes or whether they will see one single purpose. I have attempted to apply that test to the transcripts of the Palmer and Wilson judgments which the noble Viscount told us on Report this amendment was intended to reverse. I am not a lawyer and have not had time to take expert advice. I speak with hesitation. Looking at this amendment, we are asked to distinguish between a purpose by the employer to further a change in his relationship with his employees from a purpose falling within Section 146, which is to penalise or deter membership of a trade union.
The noble Viscount explained this a little further, referring to an organisational or strategic purpose. When I look at the transcripts of the Palmer and Wilson cases the only organisational or strategic purpose that I can see is the purpose of deterring employees from belonging to a trade union and penalising them if they do so. Speaking purely as a layman, if I was asked on the facts of those cases to make the distinction which this amendment asks us to make I simply could not do it. It is perfectly possible that anyone who followed that line of reasoning might reach exactly the same judgment after this amendment as they would have made before it.
The idea of a double purpose reminds me of the 18th century story of the father and son: Father, "Listen to me, my boy. When you see the two lights at the end of the hall turn into four lights you know you have had a bit too much to drink". Son, "I can see only one light". Like the son, I can see only one purpose. Why have the Government chosen to legislate in this rather weasel way? It appears to me to be as plain as a pikestaff that the underlying intention is to repeal Section 146 of the 1992 Act, but no such

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intention is avowed. Whether right or wrong, that at least would have been intelligible. But here we are given an attempt to distinguish between two purposes which are likely to be conflated.
Why the weasel way? One thought that occurs to me is that possibly the more robust intention may be in conflict with one of our international obligations. At home late on a Sunday night I was in no position to check the scope of our international obligations. Mention has been made of the ILO Convention. The noble Baroness, Lady Turner, referred in one of her amendments to the European Convention on Human Rights. Reference has also been made to the Council of Europe Social Charter of 1961. The one that I read, late at night, was Article 118 of the Treaty of Rome. That guarantees the right of association and collective bargaining between employers and workers. Article 118B, inserted by the Single European Act, tells the Commission that it shall develop a dialogue between management and labour. It is possible that the repeal of Section 146 may infringe either of those. My question is: does it necessarily follow that the weasel way of proceeding adopted in this amendment does not infringe either of those provisions? Has the noble Viscount taken legal advice on whether the amendment infringes those provisions? If not, will he withdraw his amendment until he has done so?
That brings me to the important question asked by the noble Lord, Lord Campbell of Alloway: what is the useful purpose in opposing the amendment if it does not change anything? The reason is that the amendment does not do what the Government believe it does. Therefore, the result of having it on the statute book will be many more judgments unexpected by the Government, a considerable number of cases going to the Appellate Committee of your Lordships' House at considerable expense, and further cases of rushed amendments, imperfectly drafted, coming forward on Third Readings leading to even further consideration in this House.
The noble Lords, Lord Renton and Lord Rippon of Hexham, have both argued that while brevity and clarity in the drafting of legislation are important, certainty is paramount. In this amendment I see no certainty, and I invite the noble Viscount to withdraw it.
Lord Howie of Troon: I believe that the Government amendment has been rushed through merely because this Bill happens to be before us at this time. Had the decision of the Court of Appeal not been three weeks ago but three weeks hence the Bill would have been passed and the Government would have had to consider their position more carefully. They would have had to go through the normal procedures of consultation, bringing in whatever amending legislation they thought necessary at a later date. I still believe that that would have been a much more sensible thing in any case. The Government are not clarifying the law but attempting to change it because they did not like the decision of the court. That is perfectly understandable, but we wish the Government to come clean and say what their true motives are.
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The Committee will recall that Section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992 made discrimination on the ground of union membership illegal. The result of the Wilson case indicates that so far the right not to be discriminated against is a right not to be discriminated against for making use of union services; that is, collective bargaining. Wilson refused a personal contract and wished to retain his right to collective bargaining. The NUJ in his case remained recognised but had no collective bargaining role. Wilson's pay was not increased, unlike that of his colleagues who accepted personal contracts. Thus, he suffered loss by refusing to give up his right to collective bargaining; in other words, Wilson was discriminated against, and the court rightly held that to be illegal.
The Wilson case is not an isolated example. There have been many other cases where financial inducement or a douceur, as the noble Lord, Lord Campbell of Alloway, called it, has been offered in order to tempt employees to move to personal contracts and to remove collective bargaining. In 1989 about 3,500 middle managers in British Telecom were offered company cars and one-off payments of between £1,000 and £1,500 to persuade them to take up personal contracts. The Society of Telecom Executives offered to conduct a secret ballot jointly with BT to see what the majority actually wished. BT refused. The union carried out a ballot of its own, and 89 per cent. of the employees were in favour of retaining collective bargaining. Unfortunately, in the course of time, a majority of those yielded to the inducements offered by BT. However, about 200 refused the contract on a point of principle.
Subsequently, those people were threatened with a pay freeze unless they took up personal contracts. What is that but discrimination or intimidation? I can hardly believe that that is what the Government intend in this legislation. The union took the case to the industrial tribunal and established that it could represent personal contractors on an individual basis but not collectively. The majority of the tribunal took the decision that the main purpose of the move to personal contracts was
"to improve the quality of management",
which was fair enough, and that the deterrent for those members was merely a necessary side effect to achieve BT's main purpose—that is, to offer some of the employees a pay freeze and others a pay rise. That was merely a necessary side effect. It is extraordinary.
At the time the union's lawyer reflected on the case in these words:
"No rational employer expends effort in ridding itself of the influence of a union for its own sake. It is precisely because he cannot achieve his main purpose of procuring a compliant work force who can be paid as little or as much as he wishes without weakening the union and reducing its membership. It is in order to protect the rights of employees to be members of an effective union, thereby reducing the imbalance of the employees' bargaining position with the employer, that Sections 23 (and Section 28) of the EPCA 1978 exists".
The Government's amendment as it stands could remove most of the present protection against discrimination on grounds of union membership. The right not to suffer discrimination on those grounds, or on the grounds of the use of union facilities, are

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fundamental rights enshrined in ILO principles to which the United Kingdom is a signatory, as many noble Lords have pointed out.
Personal contracts are designed to remove rights to collective bargaining. It is a roundabout way of de-recognising the union in all but name. I believe the amendment to be vindictive. We are acquainted with the Government shifting the goal posts from time to time. On this occasion they have shifted the goal posts, removed the pitch, dismantled the grandstands and taken the ball home as well. The Government should seriously think again in a more mature way rather than react quickly and improperly to a court decision which they do not like.
4.45 p.m.
Lord McCarthy: The Minister was kind enough to give the Committee a reference as regards the quotation from the noble Lord, Lord Jacques. I have read it. What comes through is that the noble Lord was replying to the noble Earl, Lord Gowrie, who was moving an amendment. Such was the situation of the Conservative Party in those days. The amendment was seeking to limit the scope of the clause to recognised unions. It appears that the Opposition at the time took the point that if the rights were given to unrecognised workers, collective bargaining might be undermined. That was the view with which the Opposition were concerned.
It is important to take on board what was happening at that point. The noble Lord, Lord Jacques, was saying that that part of the Bill was not just about recognised unions and situations and collective bargaining; it was about individual rights and the prevention of penalties. As many other speakers have said, that is precisely what was said in the judgment. Mr. Wilson was penalised by not getting a 4.5 per cent. increase. As an individual he was penalised, and that is what is wrong.
Lord Murray of Epping Forest: The Minister has been very helpful to the Committee in tracing the lineage of this particular proposal—questionable though that lineage may be—and seeking in part to put it into an historical context. The real context of this proposal is a Bill which purports to strengthen the rights of individual employees. It is a Bill which purports to give to the individual employee the right to join, and to enjoy the benefits of, an independent union of his choice. This proposal exposes not only itself, as has been so amply demonstrated, but the whole motivation of this Bill, in one fell swoop. Like the noble Lord, Lord Campbell of Alloway, I too can recognise an elephant when I see one and I can see what is the purpose of this clause.
It is to put one more weapon into the armoury of employers and, as the noble Lord, Lord Rochester, said, it is to add one more weight to the scales which are already weighted exorbitantly in favour of the employer and against his employees. The arguments we have heard today are based on the purported rights of the individual to enter freely into a contract of his choosing with his employer. This is not a debate on political philosophy. To understand the motivation
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behind this clause a pathologist rather than a political philosopher is more helpful. It goes deep into the terrible apprehension and fear of this Government of combinations formed by working men to enable them to talk with employers from some basis of equality because of the employees' obvious and clear inequality in terms of their power in industry. This clause is not new. I shall take the noble Viscount even further back in history to 1833 when the employers of the day in the building industry introduced infamous documents which insisted that trade unionists should renounce membership of their trade unions and to engage themselves not to support any other trade unionist in a contest with his employer. The response of trade unions in those days was to ignore the document; to say that it had been imposed upon them by force majeur; and that they were having no part of it. Until now, trade unionists believed that they had the protection of the law.
As my noble friend Lord Wedderburn made abundantly clear, this is not a question of the law being confused; it is a question of the law being far too clear for the Government's liking. Why do they not say so? They do not like it, so even before it has been further clarified they intend to eliminate the possibility asserted by the Court of Appeal. The substance and vindictiveness of the clause, and the way in which it has, hugger-mugger, been brought to this place can only. I believe it was the noble Lord, Lord Campbell of Alloway, who said this, but he will forgive me if it was not—bring the law and the legal processes into contempt. It is a result which I, like other noble Lords, would deprecate, but that will be the consequence.
Trade unions are right to be suspicious of the law and the role it is supposed to play in the regulation of their relationships with employers. This is a clause too far. If it is embodied in the law, an employer will be able to tell trade union members that they can have their wage increase only by signing away their trade union rights, because the Government have removed the protection that they thought they had. The only response of a decent and honourable trade unionist will be to say, "In concert with my fellows, I shall no longer work for you", and to take industrial action. Any trade unionists with decency and integrity will refuse to bow down before such an imposition. For them, as has been said in another and less noble context, there is no alternative.
Lord Mottistone: I have consulted the CBI which tells me that employers support Amendment No. 1. The amendments to it will only weaken that amendment. As I understand it, the amendment does nothing more than restate the right of the employer to seek to order his relations with his staff in a way which is considered most appropriate for the organisation concerned. More and more employers are moving to individual arrangements with their employees where-by reward is tailored to individual performance.
Without the amendment, the Court of Appeal ruling threatens to disrupt those welcome developments which are paying off in terms of improved performance, productivity and competitiveness in the private sector and in the public services. The amendment is consistent with the commitment given

39
by the Government in last year's White Paper People, Jobs and Opportunity, that they would take action to encourage employers to move away from centralised pay bargaining to individual contracts and rewards.
Many employers in both the public and private sectors have moved to individual terms and conditions, and many more wish to do so. Few have encountered any employee opposition to those arrangements. To clarify the situation, the wise thing for the Committee to do would be to support the Government's amendment and to resist the various amendments which will serve only to weaken it and not enable it to carry out its purpose, as the Opposition propose.
Viscount Ullswater: I listened carefully to the noble Baroness, Lady Turner, when she introduced the amendment. She spoke in rather broader terms than the narrow scope of the amendment—I shall return to the amendment in due course—as did the noble Lord, Lord Rochester. In many instances I agree with what the noble Lord, Lord Rochester, said. We want to encourage employee/employer relations. I believe that we seek to do so. The noble Lord has certain approaches to that which we may not share, but I do not seek to criticise what he said.
My noble friend Lord Campbell of Alloway, again in general remarks which went rather wider than the narrow scope of the amendment, identified rightly the need to define the employer's purpose in this instant. That is what the Government's amendment seeks to do where the law is unclear. Perhaps I may take up one point with him. He drew from the quotation which I gave of my noble friend Lord Ferrers. My noble friend Lord Campbell of Alloway said that the difference which my noble friend was pointing out was not between taking away a company car and a difference in wage rates. That is how he explained it. But what is meant by that, and what is clear from that, is that it was an action directed towards an individual and towards a group or class of employees; that is, a collective action. I seek to persuade my noble friend that my noble friend Lord Ferrers was trying to differentiate between an action against an individual and one against a group or collection of individuals.
The amendment seeks to undermine one of the central purposes of our amendment. It is clearly contrary to the effect of Section 146 in its present form. We believe that an employer should be free to seek to establish the bargaining arrangements with his workforce that he believes are best suited to the needs and circumstances of his organisation. He is best placed to decide on such issues. We do not consider it to be the Government's role to put obstacles such as the amendment proposes in his way.
My noble friend Lord Mottistone confirmed the view taken by the CBI. I am pleased that I am not a lone voice when I try to persuade the Committee that those are the views of employers. In seeking to establish new arrangements, an employer may wish, as we have seen in recent cases, to offer incentives to his workforce to accept the new arrangement. What is wrong with that? It is up to the employees concerned whether they accept those incentives. So long as the
40
employer is not singling out trade union members, and penalising them for being trade union members, then such action has nothing to do with the law on action short of dismissal, which our amendment seeks to clarify.
The noble Lord, Lord Moyne, asked me whether we were changing the law on individual rights. No, Section 146 protects individual rights. The Government's amendment does not seek to interfere with them. It clarifies the position with regard to an employer's rights to choose his own negotiating arrangements. The noble Lord, Lord Wedderburn, cannot ignore or disregard the words of the Government spokesman at the time the present law was introduced. Contrary to what he asserted, we have considered carefully the Court of Appeal judgment. We are clear, in the light of that judgment, that the law needs to be clarified to ensure that it achieves the intended purpose. The Government do not accept that the only benefits of trade union membership accrue through recognition of the union by the member's employer. Presumably neither do the thousands of individual trade union members who work for an employer who does not recognise their union.
Members of the Committee may have seen that the Court of Appeal's decision in the two recent cases did not dispute an employer's right to de-recognise a union. Lord Justice Dillon stressed that very issue, as the noble Lord read out in the judgment. The court's decision rested on its interpretation of the purpose of the offer of an inducement to those who agree to enter personal contracts. That is the point at issue.
As I have made clear, the important question in this section is not whether the employer recognises a trade union, or how the employer negotiates with those who are not trade union members, but whether the action is taken against an individual on grounds of trade union membership or non-membership. That is what we are seeking to clarify in the amendment—
5 p.m.
Lord Wedderburn of Charlton: Before the Minister leaves that point perhaps I may ask whether he is again making the point that he made earlier: that any action by the employer which deals with a collection or group of employees is a collective matter. Does the Minister accept that the employer (as in the case concerned in the Court of Appeal) dealt with a number of individuals on the grounds that—in the words of one of the dissenting industrial members—by ensuring that the union withered on the vine he also discriminated against the individuals at that place of work who did not wish to accept his douceur?
Viscount Ullswater: I believe that the original intention of the law was perfectly clear. Perhaps the noble Lord, Lord Wedderburn, would care to look at the amendment. I also address the noble Lord, Lord McCarthy, because he introduced the concept of an attack on individual rights in the provision:
"In determining what was the purpose … there is evidence that the employer's purpose was to further a change in his relationship with all or any class of his employees".
That is what the Government are saying. That was the original intention to which the noble Lord, Lord

41
Jacques, addressed himself. He made clear the intentions of the Government of the day in creating that legislation. At the time Section 146 related to individual protection and not to collective bargaining issues. I believe that our amendment restores that intention, which recent cases have confused.
I listened carefully to the words of the noble Lords, Lord Howie of Troon and Lord Murray of Epping Forest, who took us back even further than the genesis of this section. The noble Baroness, Lady Turner, mentioned the Armitage case. Nothing in the new clause is intended to overturn the principles expressed by the Employment Appeal Tribunal in deciding the Armitage case and nor will it do so. The EAT found that action was against Mrs. Armitage as an individual on grounds of her trade union membership. Therefore, there is a distinction between the Armitage case and the amendment that we are seeking to move—
Lord Howie of Troon: Does the Minister recall the 200 employees of British Telecom who were offered a wage freeze if they declined personal contracts? Is the Minister trying to persuade us that that was not a class of employee but was a random agglomeration of 200 individuals?
Viscount Ullswater: One must be careful in one's interpretation of "individual" and "class", which Section 146 was set down to do. It was intended to prevent individual discrimination and not class discrimination in that sense.
It is sufficient therefore, that the new clause should make it clear that Section 146 does not apply to actions which are taken with a purpose of altering bargaining arrangements. How those bargaining arrangements are to be arrived at is irrelevant and the effect of this amendment would be to indicate that any change—returning to the wording of the amendment—that was not negotiated and agreed could be considered as action taken to deter union membership.
Indeed, the noble Baroness's amendment would potentially run counter to one of the findings of the Court of Appeal in the recent cases. The court's judgment made it clear in its decision that it did not dispute an employer's right to de-recognise a union and, as a consequence, make changes in the terms and conditions of the employee's employment. As I explained earlier, that at least is in line with what Parliament had always understood and intended. The amendment, however, would appear to require an employer to negotiate on these matters in order to avoid the risk of being found to be in breach of Section 146. That is unacceptable to the Government. I believe that the amendment is misconceived and I ask the noble Baroness to withdraw it.
Earl Russell: Before the Minister sits down will he tell me whether he has taken legal advice on whether his amendment is contrary to European law?
Viscount Ullswater: I did not address my remarks to the noble Earl. Of course, the amendment proposed is
42
for domestic reasons and for the clarification of existing law. We do not believe that there is any infringement of any international obligations.
Earl Russell: Is that opinion based upon any legal advice?
Viscount Ullswater: I should have to take advice upon that.
Baroness Turner of Camden: I am not altogether surprised that the Minister does not accept my amendment to his amendment. However, at the outset of his remarks he said that the Government's intention —their desire—was to encourage employee and employer relationships. If that were so it would be sensible for employers who wanted to embark on any far-reaching structural changes in their industrial relations to do so via a negotiated agreement. As we have said on a number of occasions, our contention is that the Government's amendment is not required because there is no need to clarify. In fact, the noble Lord, Lord Campbell of Alloway, put forward the crux of the matter when earlier in the debate he quoted from the judgment of Lord Justice Dillon.
We are not talking about individuals as opposed to collectives. We clearly understand that the employer has the right to end collective bargaining arrangements if he wishes to do so. We are talking about action taken against individuals. Mr. Wilson was an individual who was disadvantaged because he refused to give up the right to trade union representation. In a nutshell that is what the issue is all about.
But the Government have introduced their amendment because they believe that employers may wish to change their arrangements. Those arrangements may require the employers to do all kinds of things that are not provided for in Section 146 and so forth. All right, if the Government want to introduce new arrangements it is logical and legitimate to do so through a negotiated arrangement with the people concerned. Why should people—collections of individuals —have different arrangements imposed upon them? If they do not like those arrangements presumably the only recourse will be to leave their employment. That is not easy when there is not much alternative employment to be had.
I am not satisfied with the Minister's response to this small and I believe entirely reasonable amendment. It provides that if an employer wishes to change structures which affect individuals he should negotiate and endeavour to agree those arrangements. In view of the Government's response I have no alternative but to test the feelings of the Committee.
5.10 p.m.
On Question, Whether the said amendment (No. 2) to Amendment No. I shall be agreed to?
Their Lordships divided: Contents, 105; Not-Contents, 130.

Division No. 1

CONTENTS

Ackner, L.

Attlee, E.

Addington, L.

Aylestone, L.

Archer of Sandwell, L

Beaumont of Whitley, L

Ardwick, L.

Birk, B.

43

Blackstone, B.

Judd, L.

Bonham-Carter, L.

Kennet, L.

Boston of Faversham, L.

Kilbracken, L.

Bottomley, L.

Kirkhill, L.

Bridge of Harwich, L.

Listowel, E.

Brightman, L.

Llewelyn-Davies of Hastoe, B.

Brimelow, L.

Longford, E.

Bruce of Donington, L.

Lovell-Davis, L.

Carmichael of Kelvingrove, L.

McCarthy, L.

Castle of Blackburn, B.

McIntosh of Haringey, L.

Chorley, L.

Mallalieu, B.

Cledwyn of Penrhos, L.

Merlyn-Rees, L.

Clinton-Davis, L.

Milner of Leeds, L.

Cocks of Hartcliffe, L.

Molloy, L.

Croham, L.

Morris of Castle Morris, L.

Dacre of Glanton, L.

Moyne, L.

David, B.

Mulley, L.

Dean of Beswick, L.

Murray of Epping Forest, L.

Desai, L.

Nicol, B.

Donoughue, L.

Ogmore, L.

Dormand of Easington, L

Peston, L.

Eatwell, L.

Pitt of Hampstead, L.

Ennals, L.

Prys-Davies, L.

Falkender, B.

Rea, L.

Falkland, V.

Redesdale, L.

Fisher of Rednal, B.

Richard, L.

Gallacher, L.

Ritchie of Dundee, L.

Galpern, L.

Rochester, L.

Gilmour of Craigmillar, L.

Russell, E.

Gladwyn, L.

Sainsbury, L.

Glasgow, E.

Sefton of Garston, L.

Graham of Edmonton, L. [Teller.]

Serota, B.

Shackleton, L.

Greene of Harrow Weald, L.

Shepherd, L.

Gregson, L

Stoddart of Swindon, L.

Hanworth, V.

Strabolgi, L.

Harris of Greenwich, L.

Taylor of Blackburn, L.

Hayter, L.

Taylor of Gryfe, L.

Hilton of Eggardon, B.

Tonypandy, V.

Hollick, L.

Tordoff, L.

Holme of Cheltenham, L

Turner of Camden, B.

Hooson, L.

Wallace of Coslany, L.

Houghton of Sowerby, L.

Wedderburn of Charlton, L.

Howie of Troon, L.

White, B.

Jay, L.

Wigoder, L.

Jay of Paddington, B.[Teller.]

Williams of Elvel, L.

Jeger, B.

Williams of Mostyn, L.

Jenkins of Hillhead, L.

Wilson of Rievaulx, L.

John-Mackie, L.

Winchilsea and Nottingham, E.

NOT-CONTENTS

Abercorn, D.

Carnock, L.

Alexander of Tunis, E.

Cawley, L.

Allenby of Megiddo, V.

Clark of Kempston, L

Annaly, L.

Clinton, L.

Archer of Weston-Super-Mare,

Cochrane of Cults, L.

L.

Constantine of Stanmore, L.

Arran, E.

Cox, B.

Astor, V.

Cranborne, V.

Astor of Hever, L.

Crickhowell, L.

Auckland, L.

Cullen of Ashbourne, L.

Barber of Tewkesbury, L.

Cumberlege, B.

Bessborough, E.

Davidson, V.

Birdwood, L.

Denham, L.

Blake, L.

Denton of Wakefield, B.

Blatch, B.

Derwent, L.

Borthwick, L.

Ellenborough, L.

Boyd-Carpenter, L.

Elles, B.

Brabazon of Tara, L.

Elliot of Harwood, B.

Braine of Wheatley, L.

Elliott of Morpeth, L.

Bridgeman, V.

Faithfull, B.

Brigstocke, B.

Fraser of Carmyllie, L.

Brookeborough, V.

Fraser of Kilmorack, L.

Brougham and Vaux, L.

Gainsborough, E

Butterworth, L.

Glenarthur, L.

Cadman, L.

Goschen, V.

Caithness, E.

Granard, E.

Campbell of Alloway, L.

Grimthorpe, L.

Campbell of Croy, L.

Haig, E.

Carnegy of Lour, B.

44

Hailsham of Saint Marylebone,

Nelson, E.

L.

Norfolk, D.

Halsbury, E.

O'Cathain, B.

Harlech, L.

Onslow, E.

Harmar-Nicholls, L.

Oppenheim-Barnes, B.

Harmsworth, L.

Orkney, E.

Harvington, L.

Palmer, L.

Hayhoe, L.

Park of Monmouth, B.

Hemphill, L.

Pender, L.

Henley, L.

Peyton of Yeovil, L.

Hesketh, L. [Teller.]

Plummer of St. Marylebone, L.

Holderness, L.

Reay, L.

HolmPatrick, L.

Rennell, L.

Hood, V.

Renton, L.

Hooper, B.

Rodger of Earlsferry, L.

Howe, E.

St. Davids, V.

Hylton-Foster, B.

Salisbury, M.

Johnston of Rockport, L.

Saltoun of Abernethy, Ly.

Lauderdale, E.

Seccombe, B.

Layton, L.

Shannon, E.

Long, V.

Shrewsbury, E.

McColl of Dulwich, L.

Stewartby, L.

Mackay of Ardbrecknish, L.

Strathclyde, L.

Mackay of Clashfern, L.[Lord Chancellor.]

Strathmore and Kinghorne, E [Teller.]

Macleod of Borve, B.

Sudeley, L.

Manchester, D.

Tebbit, L.

Mancroft, L.

Terrington, L.

Manton, L.

Teviot, L.

Marlesford, L.

Thomas of Gwydir, L.

Marsh, L.

Thurlow, L.

Merrivale, L.

Ullswater, V.

Milverton, L.

Vaux of Harrowden, L.

Morris, L.

Wakeham, L.[Lord Privy Seal.]

Mottistone, L.

Mountevans, L.

Westbury, L.

Mowbray and Stourton, L.

Whitelaw, V.

Munster, E.

Wynford, L.

Murton of Lindisfarne, L.

Young, B.

Resolved in the negative, and amendment to the amendment disagreed to accordingly.
5.28 p.m.
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved, as an amendment to Amendment No. 1, Amendment No. 3:
Line 6, after ("further") insert ("by lawful means").
The noble Lord said: Amendment No. 3 pursues the same objective which is apparent in a number of the amendments; namely, to moderate the extreme character of the Government's amendment.
First, the Government's amendment amounts to what one might call a grade (a) and a grade (b) purpose. The essence of the Government's amendment is that where the employer has a grade (b) purpose—that is, a purpose to discriminate contrary to Section 146 on trade union grounds or, although I do not believe our side of the Committee will make much of this, on, curiously enough, non-trade union grounds—he nevertheless escapes from the regime which has been the law since 1971 if he can show a grade (a) purpose. A grade (a) purpose is anything which shows that he is furthering a change in the relationship with all or any class of the employees.
In moving the amendment, there is an attempt to say that the Government may have that regime but surely the employer should be able to prove a grade (a) purpose only where his aim is to use lawful means or to adopt the objective of a change in that relationship by lawful means. More important, evidentially, is the fact that the Government's amendment does not speak of Section 146. Members of the Committee may have noticed that it refers to Section 148. Of course,

45
the latter section is the sanction, or procedurally the remedying part, of the regime in the consolidation Act which, again, has virtually always been the same. In other words, the employer here is before the tribunal because he has adopted a grade (b) purpose of discrimination, but he will escape by proving any, and however small, grade (a) purpose for changing the relationship at work on his initiative and, as we have just seen, without any need to negotiate with anyone.
As the Government's amendment stands, it would include a case like that decided by this House's Judicial Committee in 1988 of Rigby v. Ferodo where an employer insisted upon a reduction in wages. He imposed it and refused to negotiate it. He, perhaps, made the mistake from his point of view of allowing the employee to continue to work—we shall come to that point in a moment—and the employee eventually claimed the back pay that he had lost by reason of the reduction. It is a very unusual case in the way that the facts turned out; but the Judicial Committee had no doubt whatever that the employee's right of action was secure, because the contract had been broken.
In the present case, the same employer may impose a penalty upon the employee—perhaps, for example, a wage reduction —thereby furthering, according to his evidence (which has to be there), a change in the relationship of the workforce. As I understand it now, the noble Viscount would accept that such decisions were individual decisions even though they referred to a "class". The employer may say, "I am reducing the wages of all my employees. I know that that will be deeply resisted by those who want to call in their union officials, but I am not having any union officials in here".
The noble Viscount accepted that the decision in the Discount Tobacco and Confectionery Ltd. v. Armitage case still stands. Therefore, the latter situation would be a breach of Section 146 and the employee would have no chance of bringing an action before the tribunal, unless he could prove that the employer had taken action which no reasonable employer would take. I believe that the Government would strongly resist the idea that the employer had taken action that no reasonable employer could take. That is a very different formula. I must point out to the Minister that it is not the same as saying that the employer has or has not taken reasonable action or adopted something that is reasonable. It is quite different. In order to prove that the employer had adopted an action which no reasonable employer could take, one would virtually have to prove that the employer had become irrational in the sense of the word always used by Lord Diplock.
I ask the Minister the following question in passing. It is possible that now is not the time to answer it. If so, I shall understand because it is a difficult matter. However, I have a practical problem with the amendment. Is it the case that, in the kind of situation that I have described, the burden then passes, as I think it does, to the employer to show that he is not an irrational employer? Alternatively, is it the Government's understanding that, under their amendment—as one of the Minister's phrases may have indicated, although he may not have been
46
dealing with the present issue—the employee would have to prove the points by evidence all along the line; that is to say, he would have to prove that the proviso exists and applies unless it is considered that the action is such that no reasonable employer would take it, having regard to the purpose mentioned in paragraph (a)? Members of the Committee will notice that the tribunal must have regard, again, only to a grade (a) purpose.
Therefore, if the amendment to Section 148 does not include any such phrase as that contained in our amendment—namely, "by lawful means"—that would allow the employer to get through that web of the new network of rules simply by having the affidavit that is necessary to show that he has evidence that he wishes to take on the role of changing the relationship at work—however illegal that change or the means may be. He can sit on a raft of grade (a) purposes in a sea of illegalities created by his own grade (b) purposes and still win the case.
I mentioned earlier that I had discussions over the weekend, as I am sure did other Members of the Committee, with lawyers and others about the effect of the amendment. It was put to me very strongly by a few of them that unless the phrase,
"a change in his relationship",
was governed and limited by something like the words "lawful means", it would allow the employer to win by doing anything, including taking illegal action. It is not restricted to a change which the employer is in any way entitled to make. As one adviser put to me, if the employer changes job descriptions and working hours for the purpose of achieving a flexible workforce (as he would put it) and on the way penalises any employee who complains to the union or deters those who want to attend a union meeting or bring in a union official, that is all permissible. Moreover, it is all permissible so long as the collateral purpose exists of having a view to change the relationship at work. We shall return later to that phrase.
There can be no pretence whatever as to whether or not the Government's amendment adopts any part of the Court of Appeal decision; or, indeed, those of the Employment Appeal Tribunal. Members of the Committee should not take from the previous debate the idea that the EAT's decisions in the Palmer and Wilson cases are in any way what the Government's amendment would lay down as the law. For example, the Wilson case was an interpretation, albeit one that proved to be wrong and rather novel, of the existing Section 146. I repeat, if the Government refuse or reject an amendment of the kind now before the Committee and reject the idea that the employer's objective and purpose must be limited to "lawful means"—or even "lawful objectives"—we can, if they wish, add something by way of manuscript amendment and state,
"by lawful means and objectives".
The Government are in fact legislating to allow employers to use unlawful means. It is very simple: that which is unlawful today would be the equivalent, quite clearly., of what the Government have in mind. My noble friend Lord Murray mentioned 1833. Of course, that is the right time to consider. At that time,

47
the Master and Servant Acts were in force and a great deal of contract employment was criminal. They know that they cannot make it criminal now, so they want to give all power to the employer in civil law. It is as easy as that. If we accept the amendment, we would be accepting a new master and servant law. I beg to move.
Viscount Ullswater: I am grateful to the noble Lord, Lord Wedderburn, for the explanation of the purpose of the amendment under consideration. The amendment seeks to qualify further the circumstances in which an employer may be found not to be in breach of Section 146 by virtue of the purpose for which he has taken the action in question. Our new clause provides that, where there is evidence that the employer's purpose was to further a change in his relationship with his employees as well as evidence that his purpose falls within the scope of Section 146, then the tribunal is directed to treat the first purpose as the relevant purpose—always provided, that is, that the act in question was reasonable.
The noble Lord asked what was the test of reasonableness and who would have to provide it. I am advised that the tribunal will obviously have to make up its own mind, based on the evidence before it, as to whether or not it was reasonable. Therefore, if I may say so, it is a neutral situation between the employer and employee.
The amendment moved by the noble Lord, Lord Wedderburn, is, quite simply, unnecessary. It is not part of our intention, or the effect of the clause, that acts that are otherwise unlawful when the provision becomes law should be treated as lawful. That is most certainly not the position in law. This provision will not undermine any other rights that individuals may have in law.
I am sure that it is unintentional, but the amendment also has the potential to confuse the tribunal. It is not clear with regard to what law it is expected to establish the lawfulness or otherwise of the employer's actions. If the amendment appeared to introduce the possibility that it should assess whether the employer's actions would be lawful except for the effect of this new provision, then it will reach an impasse, and the purpose of the provision will be undermined. I am sure that this cannot be the intention.
It is clear, though, that the noble Lord, Lord Wedderburn, has some very legitimate concerns about the possible intimidation of individuals at work by their employer. Let me make it perfectly clear that I share this concern. Individuals should not be subject to intimidation at work because they are or are not trade union members. That is precisely what Section 146 was designed to protect against, and our amendment does not frustrate this. I believe I said that in answer to my noble friend Lord Moyne on the previous amendment.
An individual who is intimidated by his employer—the noble Lord, Lord Wedderburn, cited a case—allegedly for the purpose of furthering a change in his relationship with his employees will be protected in two ways under this new provision. First, a tribunal is
48
unlikely to find that there is genuine evidence that the employer's purpose was to further that change in his relationship. Secondly, even if it does so find, the employer's actions are subject to a test of reasonableness, a test which an act of intimidation would not pass. I hope that these points have reassured the noble Lord on the issue of potential intimidation.
I believe that there is no need for this amendment. The Government's new clause does not, as some would appear to fear, give employers carte blanche to do as they will. Individual rights are still protected. I hope therefore that the noble Lord will be persuaded to withdraw the amendment.
5.30 p.m.
Lord Wedderburn of Charlton: I thank the Minister for that reply. However, with great respect to him, I should say that it does not come to the point. The test is not a test of reasonableness; it is a test of whether the action was such that no reasonable employer would take it. That is a totally different test. If the noble Viscount is advised that they are the same, I can only take issue with him and that advice and suggest to him that that is not the case. It is quite clear that the courts would not turn that into a test of reasonableness. One has to say, "There are all the facts and the employer in question could not be a reasonable employer taking those facts into account". That is a quite different matter. If I had to look after the noble Viscount, or he me, and our duty is one of reasonable care, that is one thing. But if we have to avoid damage to the other by a step which no reasonable human being could take, that is a much higher duty of care in terms of any possible plaintiff, and a lower duty of care in terms of the defendant.
I begin to wonder what the Government are doing in this rushed legislation. The noble Viscount was asked earlier in the debate by the noble Earl, Lord Russell, whether he had taken advice on this matter. I cannot repeat the noble Viscount's exact words but I believe he said that he thought he had taken enough advice. I can only suggest to him that he has not taken enough advice. I do not believe anyone who has been briefed on this point could come to the opinion that it is a test of reasonableness. I hope he will accept that.
Of course Section 146 will still exist but it will not operate in favour of the plaintiffs for whom it was devised as the Government's amendment will remove that protection—the paragraph (b) protection—whenever the employer can give evidence that he has a paragraph (a) purpose. His legal advisers at any rate, and perhaps he himself, would have to be so negligent as to be almost deserving of committal not to be able to draft a suitable affidavit. The employer is not someone whom I cast in the role of an evil genius or demon. He is someone trying to run a business. However, if he asks whether he can carry out this provision, and he is told that he can, he may do it. He would only have to say he thought that was the best way to proceed. He does not have to care about trade union rights with regard to his individual employees. He does not have to care whether he is taking unlawful action.

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The noble Viscount has said that if an employer carries out an unlawful action, the persons against whom that is committed will still have rights. But why should that provision cancel out someone else's trade union rights? If under the new definition an employer refuses to consult according to the European directive of 1975, he may, where he proposes dismissals by reason of redundancy, in the same course of action discriminate in terms of trade union members. He may discriminate against trade union members when he selects staff for redundancy. Certain people may have rights as regards that selection or that failure to undertake consultation with a recognised union, but the rights under Section 146, which some employees in such a situation may have as their only remedy, would disappear. The people who can sue under the other rights I have referred to will still sue. However, the employer has taken unlawful action and he has taken that action to discriminate against trade union members and yet, because he claims his action furthers a change in his relationship with the workforce, he can cite it in evidence as the answer to his liability.
This is "master and servant" legislation. The section we are discussing, above all sections passed since 1980, is a class section. This is class legislation. The Government are depriving people of their fundamental rights that are recognised throughout the world. The Government are saying, "I am depriving them of those rights because the employer can further his purposes with regard to the workforce". If one asks the Government whether they can limit the action to where an employer is acting lawfully, the answer is no. The Government are acting in a class biased way and the world as a whole needs no further proof of that. One day when the technicalities of this section are explained more widely, it will be seen clearly that that is so. Ministers who are proposing this legislation will in the future be ashamed of its terms. I beg leave to withdraw the amendment.
Amendment No. 3, as an amendment to Amendment No. I, by leave, withdrawn.
[Amendment No. 4, as an amendment to Amendment No. 1, not moved.]
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved, as an amendment to Amendment No. 1, Amendment No. 5:
Line 10, after ("section 146") insert ("but not such as to infringe the right to form or join trade unions set out in the European Convention for the Protection of Human Rights and Fundamental Freedoms of 1950 or the right to organise in the Council of Europe Social Charter of 1961.").
The noble Lord said: In moving this amendment I seek to ascertain what the Government's position is on this important matter of fundamental rights. The Committee will understand that, having had a somewhat broad debate on the first amendment—I make no complaint about that—it is useful for us to look for the areas which were not covered or which need further explanation by the Government.
I take it that it is quite clear that the Minister will not accept any amendments today, no matter how we may re-jig them. I asked him earlier this afternoon whether he had the authority or the ability to accept an amendment if he suddenly had a flash of inspiration and saw merit in anything we were doing.
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As that is impossible, we should place on record our comments on how awful the Government's amendment is. We should also try to understand the Government's position—I have not been able to understand it so far—on international instruments.
Amendment No. 5 states that the employer's purpose should not be,
"such as to infringe the right to form or join trade unions set out in the European Convention for the Protection of Human Rights and Fundamental Freedoms of 1950 or the right to organise in the Council of Europe Social Charter of 1961".
If the Minister has no objection, I shall speak also to Amendment No. 6 and mention the position of the ILO convention. We did not move Amendment No. 4, which states:
"there is no evidence that the employer's predominant purpose was to cause the dismissal of or otherwise prejudice any employee by reason of his membership of an independent trade union".
The wording of that amendment follows almost precisely the wording of the International Labour Organisation Convention No. 98 on the right to organise and collective bargaining.
The International Labour Organisation convention, the European Convention on Human Rights, the Council of Europe Social Charter and the European Community Social Charter, whose wording is reflected in Amendment No. 6 and which I apprehend was agreed by only 11 member states with the right to choose whether or not to join, albeit in slightly different ways, all contain an understanding that the right not to be prejudiced at work by reason of trade union membership does not mean only going to work with a union card in one's pocket. The ILO is the most firm, the European Convention on Human Rights and the European Social Charter are different but strong, and the European Community Social Charter is rather weak. In addition to the instruments that I have mentioned there are many other international covenants and regional charters on human rights. There is no clear holding by any international body which limits the right to be a trade union member to the right merely to have a union card.
Beyond that there are certain areas which some international instruments stress more than others. I want to know from the Government which areas would be left under the regime which they set up under the amendment. What action would be possible in terms of the individual employee, which would still be prejudiced under discrimination under Section 146, but which the employer could not remove by saying simply that he has an intention and purpose to further the relationship being changed among the workforce? If there is no clear example then the Government are at risk of being in breach and in contravention of virtually all those international instruments. The one which comes to mind is the International Labour Organisation Committee on Freedom of Association—which we have chosen not to take as one of the three provisions, but nevertheless it is relevant—together with the Committee of Experts, which comprises 20 independent experts nominated for the ILO. All have termed parts of the legislation from 1980 until today as contraventions of Conventions 98 and 87.
The Government are simply trailing a coat if they do not add any limitation here, because they will be

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held to be in breach of Convention 98 as soon as winter turns to summer. I believe that they know that. The Government's real position on the ILO convention, the European convention and the 1961 Social Charter is not really that they are not in breach. They have to say that. Their position is really that they know a better place to go to and have a better way of doing things than those old-fashioned conventions. It would be much better if the Government said that.
However, if, as I believe he will be compelled to, the noble Viscount tells us that there is no breach of any of those international instruments and conventions then I believe that he is flying in the face of all the evidence. It would be possible for a case to go relatively quickly to the Strasbourg court under the European convention on the protection of human rights. I am sure that the Government will have had that in mind. I invite the noble Viscount to tell us what the Government's defence would be. I beg to move.
5.45 p.m.
Viscount Ullswater: At the outset I can assure the noble Lord, Lord Wedderburn, that the Government are fully committed to their obligations which arise from international treaty. That includes obligations arising under the European Convention on Human Rights and the Council of Europe Social Charter. We would not have proposed the new clause to which the amendments relate if we did not believe that its provisions would be anything other than compatible with those obligations.
In answer to the noble Earl, Lord Russell, the Government have not taken legal advice outside Government on the matter. However, the Government are satisfied that there is nothing in the amendment which is in breach of our EC or other international obligations.
Frankly, if we were to accept the amendment, we would run a very strong risk of distorting the nature of certain international obligations which have long been accepted by different governments, both Conservative and Labour. It has always been evident that both the ECHR and the Council of Europe's Social Charter create certain rights and obligations. No one would deny that.
Equally, however, it has always been accepted that guarantees and obligations arising under those international instruments fall to be enforced in particular ways. The amendments propose completely to alter those longstanding arrangements.
Nothing in the new clause will undermine in any way the present right of any individual to petition the European Commission of Human Rights on the basis of a claim to be the victim of a violation of the rights set out in that convention. There have, of course, been cases where individuals—having properly exhausted domestic remedies —have made such petitions. Indeed, in the case of British Rail employees dismissed for refusing to join a specified trade union, in accordance with a closed shop agreement brought in during the 1970s, not only was such a petition made
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but the commission referred the case to the European Court of Human Rights and the court upheld the former employees' complaint.
We never found out, of course, exactly what the then Labour Government proposed to do in response to that judgment. As it was, this Government were very happy to enact legislation which swept away the scope for the unjust practices that typified the closed shop.
We would certainly not willingly risk putting the UK in jeopardy of another judgment such as was given by the European Court of Human Rights in the British Rail case. We do not believe that we have done so by proposing the new clause.
Since 1953 all UK governments—whether Conservative or Labour—have been content for the ECHR to be applied in that way. Why then should we suddenly contemplate such a fundamental change as the amendment proposes? We must ask ourselves whether it would be either appropriate—or practicable—for domestic courts or tribunals to attempt to decide for themselves whether a particular action or purpose was an infringement of the ECHR.
In the Government's view, and taking proper account of the judicial practices and traditions of this country the answer to that question must be "No". Respect for the ECHR simply does not require us to adopt such arrangements. It is enough that our legislation does not infringe its provisions, and that the Government are ready to amend the law to do so, if necessary. The proposal that our courts and tribunals should make their judgments and decisions with reference to the articles of the Council of Europe Social Charter is even more radical. I should add that it is at least equally inappropriate—and perhaps even more so.
The terms of the Council of Europe Social Charter clearly apply only to the "contracting parties", who consider themselves bound by the obligations laid down in its articles. The UK Government are, of course, just such a party.
However, there is no, and never has been, individual right of complaint relating to purported breaches of those particular obligations. Instead, compliance with relevant obligations is assessed by reporting and supervisory mechanisms within the Council of Europe itself.
It follows, therefore, that to require UK courts, or tribunals, to have reference to the articles of the Social Charter in deciding cases before them would be quite incompatible with the intended operation of the Social Charter itself.
To summarise, the Government are convinced that proper respect for the obligations arising out of either the ECHR or the Council of Europe's Social Charter does not require the establishment of arrangements along the lines proposed by the amendment.
I hope, therefore, that the noble Lord will see fit to withdraw the amendment.
Lord Wedderburn of Charlton: The explanation that the noble Viscount has been good enough to give us is the explanation which the Government have given—I shall read it to see whether it is the same text —every time an issue is raised on any international

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instrument. They never argue as to why the instrument would not be broken, but refer to the fact that they never break it, that they have not broken it, and that they never will break it, and noble Lords must be satisfied with that.
I refer to the ILO Committee of Experts Report 1992. The same passage appears in the 1989 report to the Government. It states that the committee considers the overall effect of legislative change in this area since 1980 is to withdraw protection from strikes and other forms of industrial action in circumstances where such action ought to be permissible. It later continues by saying that the committee:
"would ask the Government to introduce amendments which enable workers to take industrial action against their 'real' employer and which accord adequate protection of the right to engage in other legitimate forms of industrial action such as protest strikes and sympathy strikes, as guaranteed by Articles 3, 8 and 10 of the Convention."
Repeatedly for six years the ILO has thus gone on record. The Committee on Freedom of Association in case 1546 has also accepted that analysis, as has the National Union of Seamen in its case. The Government all the time have stated that they are not in breach of the convention.
We do not know what they have said to the ILO. We are about to know because the noble Viscount was good enough to say that the documentation will be in the Library. Some parts are in the Library in the House of Commons in a bout of democratic fervour. However, we have it in the Library today.
The noble Viscount did not answer my question. That is not unknown although he usually answers most of my questions. I asked whether or not he could possibly accept the amendment or any other amendment today. He states that a way of incorporating part of those international instruments into our law would be to accept and recognise them in the amendment on the Marshalled List today. In certain respects I accept that. The European Social Charter 1961 is a good example. However, taking a standard from such a charter—the European Convention on Human Rights or Convention 98 of the ILO, which we have ratified and are supposed to adopt and accept—is surely the right way to proceed if we do not wish to be held in contravention.
Looking back over the years, I am very dissatisfied with the way that the Government have dealt with the matter of international instruments. On the one hand they say that they like them when they have a decision such as the three railway men's case in 1981 on the closed shop. With great respect to the noble Viscount, the court did not say exactly what he suggested. It will be interesting to see whether they like so much the recent decision in the Sibson case which was recently reported in the same court.
The Government have the tendency to select the cases that they like and not the cases that they do not like. That is what is happening today. They like a bit of the EAT judgment. They dislike that of the Court of Appeal. However, they will not allow the Court of Appeal judgment to be reversed with reference to international instruments which we have ratified and should observe. That is a strange posture.
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However at this stage I can do no more than beg leave to withdraw the amendment.
Amendment No. 5, as an amendment to Amendment No. 1, by leave, withdrawn.
[Amendment No. 6, as an amendment to Amendment No. 1, not moved.]
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved as an amendment to Amendment No. 1, Amendment No. 7:
Line 11, leave out ("shall") and insert ("may").
The noble Lord said: The amendment looks small but it may be important. I hope that the Government will give us some good reason if they do not accept it. As the provision stands, the government amendment demands that the industrial tribunals tell a lie. The tribunals are by order, by fiat, of the Government's new clause, compelled to tell a lie. They must say whether there is evidence of the offence within Section 146. We must say that there was not, if there is evidence of a grade (a) character, as I called it earlier in Committee. The industrial tribunal is then told to find that the paragraph (b) purpose does not exist unless it is proved that the employer is irrational in his actions or could not be regarded as a reasonable employer. It is sometimes said in the unfair dismissal cases that the employer does not fall within the band—I thought that the Government would use the phrase; I believe that it is the wording to which the courts would turn—of reasonable employers who could possibly do that kind of thing.
In the Wilson case in the Court of Appeal, it was agreed that the stated purpose of the employers was to end collective bargaining. But that was not enough in that case, as the noble Lord, Lord Campbell of Alloway, said. The passage was read to the Committee.
The Court of Appeal states at page 22 of the transcript that,
"an Industrial Tribunal is entitled to conclude robustly that an employee who has been dismissed or penalised for invoking the assistance of his or her union in relation to his or her employment has been dismissed or penalised for being a member of the union. That may not be so in all cases but certainly in an appropriate case".
In other words, the Court of Appeal is delicately telling the industrial tribunals to weigh up the evidence on all sides—not in all cases, but in an appropriate case.
The contrast with the Government's structure of thought is quite remarkable. There is no question of the tribunal weighing up all the evidence. As soon as that affidavit from the employer falls on the desk of the chairman—even if one of the industrial members dissents, as is not unknown —the game is up. The affidavit from the employer cancels out the entire discrimination, penalty or whatever it may be.
The amendment provides that the tribunal should weigh up those factors and that it may say that the one action prevails over the other unless it is such as no reasonable employer would take. That is a more reasonable provision. It is primarily a question of fact to begin with: where is the purpose; what are the purposes? The amendment moves the track of the tribunal to perceive the evidence in the way that the Government demand. However, it does not take from the tribunal that final possibility of saying in a case

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where it wishes to do justice, "In this case at any rate the discrimination is so overbearing that we say it must cancel out the first purpose under paragraph (a)". I beg to move.
Viscount Ullswater: The noble Lord has chided me for perhaps not responding to him. He asked, "Do we ever accept any amendment? Are we going to accept any amendments today?" He has not spoken to me personally about it. However, I believe that we have to take each amendment on its merits. The Government have accepted amendments and have also responded by moving their own at Committee stage during the passage of the Bill. I therefore believe that there is evidence of good faith which I believe the noble Lord to be impugning. I rather resent the attitude that he takes. However, let us leave that on one side.
I may have misled the noble Lord when I used the phrase, perhaps inadvisedly, that there was a test of reasonableness. The words that I used sounded as though I was using a test of reasonableness when I was really referring to the words as printed in the schedule. I talked about the tribunal making up its own mind. Yes, the tribunal has to make up its own mind. It has to consider,
"that the action was such as no reasonable employer would take having regard to the purpose mentioned in paragraph (a)".
The noble Lord kindly explained the effect of the amendment. It goes to the heart of that argument. I am afraid that although the amendment may have been presented as an eminently reasonable one, I am unpersuaded of its value. In fact I am persuaded only that the amendment would undermine all that our provision is intended to achieve.
While the new Clause I moved earlier this afternoon directed the tribunal considering a Section 146 case (where evidence of two conflicting purposes for the employer's actions is presented) to treat the negotiating purpose as the relevant purpose, this amendment would provide only that the tribunal may do so.
I am surprised, given the explanation that I gave, in moving the Government's clause, of the longstanding intentions behind the provisions concerning action short of dismissal, that this amendment has been moved. I have made it clear that what is now Section 146 was only ever intended to apply in situations where acts of individual discrimination had taken place. It was never intended to have a locus in issues related to collective bargaining.
Recent cases have shown that this intention is being undermined, as the section has been brought into play in situations where employers have sought to change their negotiating arrangements. That is why our amendment was tabled. Our amendment says, in effect, that where an employer can demonstrate that he genuinely has the purpose of changing his negotiating arrangements, Section 146 does not apply. It re-establishes the firm principle that the section does not apply to issues relating to changes in collective bargaining arrangements.
The amendment we are considering here says effectively that the section might apply, but then again
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it might not. It gives tribunals discretion. But, in doing so, it leaves them in no better a position than they are now to know how to decide these cases. It leaves the current confusion in law unresolved, when we have made it quite clear that our intention is to clarify the law. For all these reasons it is unacceptable, and I ask the noble Lord to withdraw it.
6 p.m.
Lord Wedderburn of Charlton: I wish to make two points to the noble Viscount. First, he often compliments my noble friends and myself on moving tiny little amendments which he then says will undermine the entire structure of the proposed legislation. There is this curious but highly clever method of moving "may" instead of "shall". If the new clause is such a curious structure that it could be undermined by changing one word for another, I hesitate to think what may happen in the real world of litigation.
The noble Viscount repeats the formula and I took account of what he said earlier. I believe that the nub of it was that Section 146 is only intended to protect individuals, not to deal with collective bargaining. That is absolutely right, we have been saying that to the Minister all the afternoon. It is exactly what the Court of Appeal says on page 22 in the Wilson and Palmer cases. However, the Minister does not seem to accept that. He casts out that paragraph from the judgment as though it were almost as bad as a paragraph (b) purpose. It can have no place. The Court of Appeal ruling must be overturned without anyone worrying about it. That is strange.
Do the Government realise what the law will look like when it is produced to a tribunal which has to deal with matters on the ground, with ordinary people's lives and employers' lives? The tribunal will see all the evidence and whoever represents the employer will be able to say, "I am sorry, you can't look at that, you can't take any account of it whatever because it relates to Section 146. The evidence must go". It is not being put to the tribunal under the terms of the Government's new clause, with the tribunal weighing it up and considering it. It is to be cast out.
Thus, the tribunal is likely to say the same as in the famous cases back in the 1960s where tribunals refused to decide matters as the statute demanded. They said that the decisions were political. It may be that the noble Viscount is jeopardising the position of tribunals in that respect because it is inserting a serious political test in the middle of industrial relations. We are now gradually seeing how far the Government wish to go. However, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord McCarthy Lord McCarthy moved Amendment No. 8:
Line 16, leave out subsection (4).
The noble Lord said: The Government make a great deal this afternoon of the word "clarity" and defend the whole new clause that we have considered on the grounds of making things clear. Then we come to subsection (4) which is the object of our amendment. We propose that the five lines in

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subsection (4) should be deleted, not because we are certain that they are evil or that they are contradictory, but because we cannot make sense of them.
I believe it was before the noble Viscount participated in these exchanges, but the subsection reminds me of the famous Section 228 of the Trade Union and Labour Relations (Consolidation) Act 1992 which came out of the previous legislation about separate work place ballots. At that time it used be called the "gibberish clause". This clause is like the gibberish clause and I shall read it to the Committee, not in any way to make it unclear but to try to clarify it because it is not clear to me. The subsection states:
"Where the action which the tribunal determines to have been the action taken against the complainant was action taken in consequence of previous action by the employer paragraph (a) of subsection (3) is satisfied if the purpose mentioned in that paragraph was the purpose of the previous action".
I find that difficult. I ask the Minister: what can it mean? It could mean one of two things. The first seems reasonably peaceful and non-significant and therefore, in one of his favourite words, "unnecessary". However, the other is doubtful and perhaps dangerous:
"Where the action which the tribunal determines to have been the action taken against the complainant".
It could be, for example, an offer of 10 per cent. if the worker would go on to individual contracts. Secondly, was the action,
"taken in consequence of previous action by the employer"?
Was there, for example, a prior decision to move to the de-recognition of a union? Then,
"paragraph (a) of subsection (3)".
That is to say, in a situation where,
"there is evidence that the employer's purpose was to further a change in his relationship with all or any class of his employees",
the tribunal will be satisfied if,
"the purpose mentioned in that paragraph was the purpose of the previous action".
That previous action was the desire to further a change in relationships by introducing individual contracts.
If the clause is to be construed in the way in which I construe it at the moment, an offer of 10 per cent. to move to an individual contract for the purpose of de-recognition is a sufficient justification of subsequent action, short of dismissal.
The problem with that is that one wonders why we have the phrase in subsection (4) about previous action, and the consequences of that previous action. If one takes a rather more worrisome view of the clause, it is not clear how previous is "previous". What exactly is "consequence"? It is possible to look at the clause and say that the employer might have taken some action in the past in relation perhaps to some other group of employees and they were being changed in order to further a change in relationship. Having done that once, the employer now cites it in order subsequently to do the same to another group of workers in quite different circumstances at an undated time in the future. We do not know which the clause means or what it means. We ask these questions for the purpose, as the Minister says, of clarification.
Lord Rochester: I must join the noble Lord, Lord McCarthy, in questioning the logic of subsection (4). I do not understand it either and I hope that the noble Viscount will be able to offer some explanation. Whether or not he can, it is not good that the Bill should leave this House in a state where the subsection remains. I do not know quite what we can do about it at this stage. I take comfort from the thought that it may be possible at Report later this afternoon to introduce an amendment which would make more sense of what the Government have in mind, apart from the merits, before the Bill goes to another place.
For the moment I content myself with saying that I support the noble Lord, Lord McCarthy, in expressing the hope that the noble Viscount will be able at least to explain in more simple terms than those of the subsection itself what on earth it means.
Viscount Ullswater: I accept that the noble Lord, Lord McCarthy, introduced this in the nature of a probing amendment and that the amendment itself would remove from the new clause subsection (4), which is a subsidiary but necessary part of it. It may be helpful if I explain what the intended effect of the subsection is. I have to say that not only did I have to read the subsection very carefully but also the amendment to make certain that I understood the purpose and wording of it. I hope that I shall be able to demonstrate to the Committee that it is required and is clear in its effect.
The first important point to bear in mind is that subsection (3) operates only where there is evidence that the employer's purpose in taking the action complained of was to further, and I stress the word "further", a change in his relationship with all or any class of his employees.
It may be best to explain the effect of subsection (4) by way of an example. Let us suppose that we have an employer who wishes to persuade his employees to give up a contractual right to collective representation or, for that matter, a contractual right to agree their terms and conditions of employment without collective representation. Let us then suppose that the employer offers a pay increase from a certain date provided his employees give up the right in question by that date.
It may turn out that the offer does not achieve its intended results because few employees accept it. If that happens, the employer may well give up any hope of achieving the change in bargaining arrangements he was hoping for. However, he is still likely, simply as a matter of good faith, to want to implement his offer to those few who did accept it.
In that situation the probability is that his purpose in not paying the increase to those who refused the offer would not be to further a change in his bargaining arrangements; rather, it would be to implement the offer he made. It would not be sensible to produce the result that, while the new clause protected the making of the offer from being found to contravene Section 146, it did not protect the consequential implementation of the offer from being found to be taken for the purpose of penalising employees who refused it from being union members. Subsection (4) removes that possibility by ensuring

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that, where the action complained of is consequential on previous action taken for the purposes of furthering a change in bargaining arrangements, the consequential action is also to be regarded as taken for that purpose.
I do not believe that there is any hidden mystery in this subsection. I recognise that Members of the Committee opposite are not sympathetic towards the intention of the clause as a whole. I nevertheless hope they will concede that, given the policy intentions of the new clause, subsection (4) is necessary to ensure that those intentions are realised in one particular respect. I hope my explanation has made that entirely clear. Indeed, without the subsection, the law would remain unclear in this particular respect. It is therefore consistent both with our policy intention and with our purpose of clarifying the law that it should be included. I hope that the noble Lord will see fit to withdraw the amendment.
6.15 p.m.
Lord Wedderburn of Charlton: Before the noble Viscount sits down, I am sure that we are all grateful to him for the example. Perhaps I may ask him a question relating precisely to his example. In many circles some effort has been made to try to find examples of where subsection (4) would be important. I keep to the example that he gave. If subsection (4) were not there—he says that it is needed; therefore there would be a change in his view—why would there be a change? If an employer makes an offer which might well be discriminatory under Section 146 and only some of the employees take it up, why is it not the case that, given proper evidence in the ordinary way, his purpose remains the same throughout. The tribunal would see that the purpose was there in the offer, there in the debates which he might have with any of the employees, and there in its implementation to the extent that it was accepted. Why is subsection (4) needed?
Viscount Ullswater: I believe that in the circumstances the noble Lord suggests he is probably right. However, this is a protection for the instances where the employer may be put at risk.
Lord McCarthy: The noble Viscount confused me at the beginning (indeed, he confused me at the end) because he said he had to read my amendment very carefully. With respect, my amendment is clarity itself. It just says, "Take it away". Anybody can see that. But he tells me what it means. I think I understand now what it means, but my concerns remain. They are rather different from the concerns of my noble friend Lord Wedderburn. Subsection (4) appears to say that the employer comes along and says he wants to change relationships; for example, to move to individual bargaining. That works if only 10 people want it. It works if 50 people want it. It does not make any difference. One may quote them as a particular grade. But it does not stop it working if one does not get everybody the first time. I do not see why one would
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not want to do it. Even if one did want to do it, the way the clause is written now one would not be allowed to do it.
On the other hand, if one wants to do something more complicated—if one does not simply want to go on to individual contracts but wants, for example, to introduce performance-related pay, or some system of systematic appraisal—one might legitimately take the view that that is no use unless the whole of that category of workers can be got to do it at the same time. It is not much good if one puts in a group bonus or a performance bonus based upon the performance of the whole group and only 10 per cent. sign up for it. I see that. But then one would not want that. One would be perfectly prepared to say to the people to whom one made the offer that the offer was contingent upon most people going along with it, and that today only 10 per cent. were going along with it so one did not want to do it. Either way I do not see that one needs this clause. If the Government want to keep it in, they might write it in a more straightforward way. On that basis, I withdraw the amendment.
Amendment No. 8, as an amendment to Amendment No. 1, by leave, withdrawn.
[Amendments Nos. 9 and 10, as amendments to Amendment No. 1, not moved.]
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved, as an amendment to Amendment No. 1, Amendment No. 11
Line 25, at end insert:
("(6) Subsections (3) to (5) of this section shall not come into force until one year after the date of the passing of this Act or on such earlier date by which the condition in subsection (7) is satisfied.
(7) The condition is that the Secretary of State shall invite the Committee of Independent Experts of the International Labour Organisation to express their view about the compatibility of the section with the Conventions of that Organisation and shall publish their report on a date not later than one month after its receipt."
(8) Nothing in this section shall affect any enactment or rule of law other than sections 146 to 151 of the 1992 Act (action short of dismissal).").
The noble Lord said: I move this amendment briefly in order that it may be put on the record. The amendment does three things. Perhaps I may begin with the proposed new subsection (8). I take it that the Government—and if this is agreed it may come back to us on Report—do not object to the notion in the new subsection (8). That notion seemed to be inherent in much that was said; namely, that the new subsection should not affect the interpretation of any sections other than Sections 146 to 151. I believe that they are the points to put in the consolidation Act.
There is one reason which makes it very important for the Government to think very hard about whether they reject this idea. Section 152 of the consolidation Act protects employees from prejudice and being discriminated against by reason of trade union membership or activities, or indeed from dismissal through being non-trade union members. I am not alone, among those who have looked at the amendment, in being very concerned and anxious about the future. It may be the next Bill; it may be the next Third Reading; who knows? That is what is so

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bad in the Government's posture. No one had predicted this amendment, not even those of us who take perhaps a lower view of the legislation over many years than some Members. It would be heartening to know that the Government are not, by extension of logic, about to support a probe into the area of depriving workers of their protection against unfair dismissal on the ground of being a trade union member where the argument as to what is and what is not a proper range for a trade union member in his activities is precisely the same in the case law as for action short of dismissal. If the Government say there is a gulf—they may say, "Right, indeed there is"—between action short of dismissal and dismissal, it would be heartening to know that they think that way. If they stay silent on that point or merely reject it, it may make some of us wonder whether we ought to interpret the future in that sense.
The other subsections that have been put together for convenience are different matters. Proposed subsection (6) would delay for a year the coming into force of subsections (3) to (5) of Section 148, which are the substance of the Government's amendment today. Our amendment is too humble in that respect. There are many debates and discussions which could take place during such a period. We have only put down one condition for consideration. No doubt, in view of their attitude to these matters, the Government will object. It seemed to us quite reasonable that a report on this matter by the Committee of Independent Experts of the ILO should be awaited—if it were not received within a year the matter would pass over—and its publication should be rather more widespread than perhaps is now contemplated. As the Committee has heard, we are making progress through the various libraries, in this country at any rate.
So there are three different points: the confinement of the new law to Section 146; the stay of execution for a year for proper consideration; and during that year a debate to determine just where the standard should be drawn by reference inter alia to a report of the ILO Committee of Independent Experts. I beg to move.
Viscount Ullswater: I fear that I may repeat myself but I have to reiterate my assurance that the Government are fully committed to their obligations, which arise from international treaties including those of ratified ILO conventions. The noble Lord must know that no UK Government have ever felt it necessary to seek the ILO Committee of Experts' views before bringing into operation legislation which they believe to be entirely compatible with ratified conventions. I hope that he will accept that as our position, even if he does not share our analysis.
I understand the nature of what the noble Lord says. We have discussed it on a previous amendment. I do not seek to say more than that about the matter. However, I should like to address the point that he made at the beginning of his remarks. I can assure him that there is no question of the provisions of the new clause affecting any enactment or rule of law other than the appropriate parts of statutory employment protection legislation. To state that, as the third subsection of the amendment would do, is therefore quite unnecessary. To imply that there could be some
62
such effect in the absence of that subsection would be quite wrong. Indeed, to accept that element of the amendment could cast doubt on the way in which provisions without a similar disclaimer could possibly apply, and that is clearly undesirable.
The noble Lord demonstrated his conception of how certain international treaty obligations might be applied in this country. However, as I explained not only in this debate but on previous occasions, he proposes systems which we believe are neither appropriate nor practical and which even he must recognise would be highly novel. I hope, therefore, that he will agree to withdraw his amendment.
Earl Russell: Before the noble Viscount sits down I should like to ask him one question. I accept what he said about the intention to accept our international obligations. Were he to find that he was mistaken and the Government were pronounced by the competent authority to be in breach of one of our international obligations, would the Government repeal this amendment if it were on the statute book?
Viscount Ullswater: We respond to every recommendation of the committee of experts to the United Kingdom Government. I indicated in the last instance that, where the law was found to be outside the international standards, it was altered.
Lord Wedderburn of Charlton: I hear what the Minister says. We debate this matter often enough but I cannot promise that we shall not press him again on this matter. International standards are important. In our view the Government take their pick. They see a nice decision from the European Court of Human Rights in the case of the railwaymen. They pick it out and back it. But when year after year (for five years now) they see decisions of the Committee of Independent Experts—which is the relevant authority, together with the Committee on Freedom of Association, which takes the same view as the ILO (and I remind the Committee that it is a tripartite organisation and the only world-wide tripartite organisation to deal with employment matters as an agency of the United Nations)—they do not respond but simply say that it is wrong. Year after year they have told the committee that it is wrong and year after year the committee has told them that they are wrong. That is not the way to carry on if you believe in international standards.
However, I see that we have committed our usual fault in our poor amendments: either that they are undesirable or unnecessary. Half of this amendment, as the noble Viscount said, is undesirable, and the other half he considers unnecessary. Sometimes I feel that perhaps he should flag up which of those labels he will use and use a set of red, green or yellow cards so that we would know which way to point in terms of the argument.
The last part of our amendment is important. From what the noble Viscount said, I take it that the Government have no intention of extending that line of argument to dismissal. If that holds sway, it would

63
be very welcome indeed. It would be worth hearing on this amendment. I beg leave to withdraw the amendment.
Amendment to the amendment, by leave, withdrawn.
The Deputy Chairman (Baroness Serota): The Question is that Amendment No. 1 be agreed to.
Baroness Turner of Camden: We have been unable this afternoon to effect any improvements in this clause introduced so late in the proceedings by the Minister. As we said, the new clause seeks to give support to legitimise what we believe to be the maverick decision of the Employment Appeal Tribunal in two cases: Associated Newspapers Ltd. v. Wilson and Associated British Ports v. Palmer.
The Minister has not persuaded me this afternoon that there is a pressing need for the introduction of the amendment. I do not believe that clarification is needed. The Court of Appeal decisions were not only in accordance with previous precedents. Had the court decided otherwise it would in my view have been a breach of the existing law. The decisions that the court made were in line both with Section 146 of the 1992 Act and the conventions that this Government themselves have ratified.
As we have repeatedly said, there has been no consultation with interested parties. Although we have managed to have Committee and Report stages, this legislation is all being crammed into the same day on which we are having Third Reading. There has not been time for effective parliamentary scrutiny, as the noble Lord, Lord Campbell of Alloway, pointed out. However, we have done our best in the time available to us.
It is our belief that the law should not allow employers to impose financial penalties on individual employees who wish to retain the right to be represented by their union. That is the crux of the matter and it is what this debate is all about. That is hardly strengthening the rights of individuals. In fact, it is yet another employment right that will have been taken away if this clause reaches the statute book.
The Government continue to argue that there is a difference between the right to belong to a union and the right to have that union negotiate on behalf of its members. Yet, as everyone knows, the major reason for joining a union is to have terms and conditions of employment negotiated on behalf of the individual and the group. Once that right is taken away there is every prospect that the union will "wither on the vine", as the dissenting member at the EAT correctly said. So it is disingenuous to argue that the clause is not directed against trade union membership. Clearly it is. It will give employers the loophole for which they are looking to get out of obligations imposed by Section 146 of the 1992 Act, obligations which have been in existence since 1975. I repeat that these are obligations to individuals.
The ILO Convention 98 (General Principles), Protection Against Anti-Union Discrimination, clearly states,
64
"Legislation should lay down explicitly remedies and penalties against acts of anti-union discrimination by employers against workers' organisations in order to ensure the effective application of Article 1 of the Convention … Protection against acts of anti-union discrimination should cover not only hiring and dismissal, but also any discriminatory measures during employment, in particular transfers, downgradings and other acts that are prejudicial to the worker …"
Furthermore:
"No person should be prejudiced in his employment by reason of his membership of a trade union, even if that trade union is not recognised by the employer as representing the majority of workers concerned".
It would be difficult to find a more discriminatory act or one more likely to deter an employee from belonging to a union than the provision of extra money in return for giving up the right to trade union representation or, in the Daily Mail case, the withholding of an anticipated increase in pay from Mr. Wilson because of his failure to sign away that right to trade union representation. There is no doubt that both the employers involved in the two cases wanted to bring to an end the arrangement that they had had for many years—in the case of the Daily Mail since 1912—under which they had negotiated terms and conditions of employment with independent unions representing their workforces. However, it had its effect on individuals when the employers attempted to bribe the individuals to abandon rights to trade union representation that they had had for many years.
I understand that if the clause becomes part of the Act, it will not be implemented retrospectively. The Minister confirmed that during the debate and I thank him for that assurance. But there will be a clear signal to employers that, if they should attempt to do what those two employers did, they can expect to get away with it. That is entirely unacceptable. For those reasons I oppose the clause.
6.30 p.m.
Lord Rochester: I shall detain the Committee for only a few moments. In response to my speech on Amendment No. 2, the noble Viscount rightly said that I had spoken rather broadly to it. Indeed I did. In fact, at that time I spoke more in opposition to the government amendment than in support of the amendment moved by the noble Baroness, Lady Turner.
We remain of the opinion that both in the manner in which it was introduced and in its substance Amendment No. 1 is unacceptable. It is unacceptable in substance for the reasons that I gave earlier. I shall therefore say no more than that we find ourselves in strong opposition to it and shall certainly vote against it when the Question is put to the Committee.
Lord Wedderburn of Charlton: Perhaps I may add one word to my noble friend's case against the clause. The debate has clearly shown what the Government are about. It has shown that there was no uncertainty in the judgments of the Court of Appeal. Indeed, if it showed anything it showed that: no uncertainty at all. It showed that the Government did not like the Court

65
of Appeal judgments; that they are legislating with no concentration and with great speed against a specific judgment. But it showed even more than that.
Recently economic conditions have begun to change; there has been a greater sense that those who feel oppressed are striking back or defending themselves as individuals by collective action in the workplace. It is therefore no accident that this step has been taken so hurriedly at a time of change in the social and economic cycle. Indeed, a letter from the Secretary of State to the Graphical, Paper and Media Union on 11 th May stated:
"The nature of the employment relationship is that an employer offers work, and an employee undertakes to do that work in accordance with the terms offered by the employer".
We have had it again today—no negotiation, no talk of discussion. The employer's will must prevail as soon as he can swear the necessary affidavit. If Members of the Committee do not vote against the amendment, it will be a sad day.
Viscount Ullswater: I should like to reiterate briefly the reasons for tabling the amendment. It has always been the understanding of the Government that the law contained in Section 146 of the Trade Union and Labour Relations (Consolidation) Act existed to protect individual employees from acts of victimisation by their employer on the grounds of their union membership or non-membership. The intention was never that the section should prevent employers from making and implementing entirely legitimate decisions about how they negotiate with their workforce.
As I have already made clear, that understanding was shared by successive administrations of different political persuasions. It is certainly not new. When it became apparent from the recent Court of Appeal cases that our understanding was not being borne out by the judgments in the courts and that the law was therefore in a state of some confusion, it was clear that it was the duty of the Government to act and to remedy that confusion. That is what the new clause does.
We have had a vigorous debate, not only on the new clause, but also on the amendments to it tabled by Members opposite. I hope that I have been able to offer reassurance on many of the issues highlighted. Our debates this afternoon have tended to focus on situations where an employer de-recognises a trade union, because that is the situation that gave rise to the recent Court of Appeal cases. However, I remind the Committee that our amendment protects the actions of an employer when he acts reasonably to further any changes in his relationships with his employees. The provision, therefore, could apply not only where the employer seeks to de-recognise a union, but also where he seeks to move towards recognition, perhaps because he has decided to introduce a single union deal and wants to encourage his employees to sign new contracts of employment. The provision is entirely even-handed.
Anxiety has also been expressed in regard to the late stage at which the new clause has been tabled. I explained to the Committee that the timing of the amendment was determined by the Court of Appeal cases, which demonstrated the need for clarification of
66
this area of law. I further remind the Committee that this afternoon will not be the only occasion on which the provisions will be debated. When deliberations in your Lordships' Chamber are complete, the Bill will pass to another place, where these important matters will be debated in full again.
The issue that we have debated, and shall continue to debate, is an important one. The Government's new clause will provide much needed guidance for courts and tribunals. I commend it to the Committee.
Lord McCarthy: Before the Minister sits down, the noble Viscount told us that he would not have anything to do with this kind of clause extending to dismissal. How far will it extend? Suppose an employer used the clause to refuse to promote a trade unionist; suppose he downgraded an employee; suppose he excluded an employee from a profit bonus; suppose he put all the trade unionists who would not sign to come out of the collective agreement on night work and shift work; would all that be permissible?
Viscount Ullswater: That is for the tribunal to decide, given the evidence. What we have been discussing all afternoon is what a reasonable employer would seek to do. I do not know the circumstances of all the cases mentioned by the noble Lord. It is for the tribunal to come to a comprehensive and satisfactory judgment given the indications that new amendments insert into Clause 146.
6.39 p.m.
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 115; Not-Contents, 76.

Division No. 2

CONTENTS

Aberdare, L.

Cross, V.

Allenby of Megiddo, V.

Cumberlege, B.

Arran, E.

Davidson, V.

Astor, V.

Denham, L.

Astor of Hever, L.

Denton of Wakefield, B.

Belstead, L.

Elles, B.

Blake, L.

Elliot of Harwood, B.

Blatch, B.

Elliott of Morpeth, L.

Blyth, L.

Erroll, E.

Borthwick, L.

Faithfull, B.

Boyd-Carpenter, L.

Ferrers, E.

Brabazon of Tara, L.

Fraser of Carmyllie, L.

Braine of Wheatley, L.

Gainsborough, E.

Bridgeman, V.

Gardner of Parkes, B.

Brookeborough, V.

Goschen, V.

Brougham and Vaux, L.

Granard, E.

Buxton of Alsa, L.

Haig, E.

Cadman, L.

Hailsham of Saint Marylebone, L.

Caithness, E.

L

Campbell of Alloway, L.

Harlech, L.

Campbell of Croy, L.

Harmar-Nicholls, L.

Carnegy of Lour, B.

Harmsworth, L

Carnock, L.

Haslam, L.

Chelmsford, V.

Hayhoe, L.

Clanwilliam, E.

Hemphill, L.

Clark of Kempston, L

Henley, L.

Cochrane of Cults, L.

Hesketh, L. [Teller.]

Colnbrook, L.

Holderness, L.

Colwyn, L.

HolmPatrick, L.

Constantine of Stanmore, L.

Hood, V.

Craigavon, V.

Howe, E.

Craigmyle, L.

Kitchener, E.

Cranborne, V.

Lane of Horsell, L

Crickhowell, L.

Liverpool, Bp.

67

Long, V.

Ridley, V.

McColl of Dulwich, L.

Rodger of Earlsferry, L.

Mackay of Ardbrecknish, L.

Russell of Liverpool, L.

Mackay of Clashfern, L.[Lord Chancellor.]

St. Davids, V.

Saltoun of Abernethy, Ly.

Macleod of Borve, B.

Seccombe, B.

Merrivale, L.

Selborne, E.

Mersey, V.

Shannon, E.

Mottistone, L.

Stewartby, L.

Mountevans, L.

Strathclyde, L.

Mowbray and Stourton, L.

Strathmore and Kinghorne, E.

Murton of Lindisfarne, L. [Teller.]

Napier and Ettrick, L.

Sudeley, L.

Norrie, L.

Thomas of Gwydir, L.

Onslow, E.

Thurlow, L.

Orkney, E.

Ullswater, V.

Park of Monmouth, B.

Vaux of Harrowden, L.

Parkinson, L.

Vivian, L.

Pearson of Rannoch, L.

Wakeham, L. [Lord Privy Seal.]

Pender, L.

Peyton of Yeovil, L.

Wharton, B.

Prior, L.

Whitelaw, V.

Rankeillour, L.

Wise, L.

Reay, L.

Wynford, L.

Renton, L.

Young, B.

Renwick, L.

NOT-CONTENTS

Ackner, L.

Jenkins of Putney, L.

Archer of Sandwell, L.

Kilbracken, L.

Ardwick, L.

Kirkhill, L.

Attlee, E.

Listowel, E.

Birk, B.

Llewelyn-Davies of Hastoe, B.

Blackstone, B.

Lockwood, B.

Bonham-Carter, L.

McCarthy, L.

Brooks of Tremorfa, L.

McIntosh of Haringey, L.

Carmichael of Kelvingrove, L.

Mallalieu, B.

Cledwyn of Penrhos, L.

Mason of Barnsley, L.

Clinton-Davis, L.

Merlyn-Rees, L.

Dacre of Glanton, L.

Molloy, L.

David, B.

Moyne, L.

Dean of Beswick, L.

Murray of Epping Forest, L.

Desai, L.

Nicol, B.

Donoughue, L.

Ogmore, L.

Dormand of Easington, L.

Perry of Walton, L.

Eatwell, L.

Peston, L.

Fisher of Rednal, B.

Pitt of Hampstead, L.

Fitt, L.

Rea, L.

Gallacher, L.

Richard, L.

Galpern, L.

Rochester, L.

Gilmour of Craigmillar, L.

Russell, E.

Gladwyn, L.

Sefton of Garston, L.

Glasgow, E.

Serota, B.

Graham of Edmonton, L.[Teller.]

Soper, L.

Stedman, B.

Greene of Harrow Weald, L.

Stoddart of Swindon, L.

Grey, E.

Taylor of Blackburn, L.

Harris of Greenwich, L.

Taylor of Gryfe, L.

Henderson of Brompton, L.

Tordoff, L.

Hilton of Eggardon, B.

Turner of Camden, B.

Hollis of Heigham, B.

Wedderburn of Charlton, L.

Hooson, L.

Whaddon, L.

Houghton of Sowerby, L.

White, B.

Howie of Troon, L.

Williams of Elvel, L.

Jay of Paddington, B.

Williams of Mostyn, L.

Jeger, B.

Winchilsea and Nottingham, E.

Jenkins of Hillhead, L.

On Question, amendment agreed to.

Resolved in the affirmative, and amendment agreed to accordingly.
House resumed: Bill reported with an amendment.

European Communities (Amendment) Bill
Brought from the Commons; read a first time, and to be printed.

Bosnia
6.48 p.m.
The Parliamentary Under-Secretary of State, Ministry of Defence (Viscount Cranborne): My Lords, with the leave of the House, I shall repeat in the form of a Statement the answer to a Private Notice Question which was asked this afternoon in another place. The Answer is as follows:
"The Foreign Ministers of the United States, France, Russia and Spain together with my right honourable friend the Secretary of State for Foreign and Commonwealth Affairs met in Washington on 22nd May and issued a statement containing a joint programme of action on the former Yugoslavia. They agreed to continue working urgently to halt the conflict—starting with further action in the UN Security Council on safe areas, monitoring of the Bosnian border with Serbia-Montenegro and the establishment of a war crimes tribunal—and to continue efforts to achieve a negotiated settlement building on the Vance-Owen process and intensified international efforts. They reaffirmed their view that sanctions against Serbia and Montenegro should be rigorously enforced until the conditions set out by the United Nations for their review are met, including the withdrawal of Bosnian Serb troops from territories occupied by force".
My Lords, that concludes the Statement.
Baroness Blackstone: My Lords, I thank the Minister for the Statement and welcome a number of points in it. First, I welcome the fact that pressure to arm the Bosnian Moslems has been resisted. I also welcome the continuation of humanitarian assistance and the decision to go ahead rapidly with a war crimes tribunal. We welcome on these Benches, too, the continuation of economic sanctions against Serbia and Montenegro. But I very much hope that the decision taken some two weeks ago to tighten these sanctions has already been properly implemented. I welcome the decision to increase the international presence in Macedonia and Kosovo in the interests of preventing the spread of conflict.
I turn to one or two questions. Does this latest shift in policy mean that the Vance-Owen peace plan has been abandoned? The Minister referred to building on the Vance-Owen process. What does "building on a process" mean in this instance? Can he say whether Lord Owen was consulted on the latest proposals and what his views were on them? Secondly, can the Minister clarify the position on the sealing of the border between Serbia and Bosnia? If I may say so, the suggestion made in the joint statement from Washington that we are watching to see whether the border closure is effective is extraordinarily weak. What evidence is there that the Government in Belgrade are carrying out their undertakings in that

69
respect? What actions are we taking now to ensure that they do? Is President Milosevic to be allowed to get away with rejecting international monitors?
It is somewhat surprising that the Minister has given no indication in the Statement as to where the safe areas are to be. Nor has he given any indication as to how they are to be made safe for civilians. We need to know rather more than we have been told if we are to be reassured that the Bosnian Moslems have not been abandoned by the international community, as their president was apparently saying over the weekend. Many Members of your Lordships' House will wonder whether the Bosnian Serbs have been allowed to walk away with the spoils of war. Will independent Bosnia survive or not? Will the Minister also give the House more information on what steps are to be taken to put pressure on Croatia to stop the fighting in central Bosnia between Bosnian Croatians and Moslems? Finally, can he say what the options are for the intensified international efforts to which he referred towards the end of the Statement?
Lord Bonham-Carter: My Lords, I, too, thank the Minister for repeating the Statement made by his honourable friend in another place but I must confess that I found it a dismaying Statement and a transparent climbdown. I should like to repeat the point made by my noble friend Lady Seear when a previous Statement was made that a succession of Statements or Answers to Private Notice Questions are no satisfactory way to discuss this complicated, tragic and extremely dangerous situation. It is high time that we had a proper debate in which many of the questions put to the Minister by the noble Baroness, Lady Blackstone, can be properly discussed and properly answered in your Lordships' House. Until we have such a debate we shall get information in bits and pieces. We shall ask a few questions in a few minutes, as we are now, but we will end unsatisfied by the answers we are given and the information we receive.
I must confess that I find that the Washington communiqué, as I think it is known, in no way lives up to the scale of events which it is supposed to address. One could not find a more classic case of too little and too late. For months—I think I am right in saying that it is at least 11 months—the Government have resisted proposals made by my right honourable friend in another place and repeated from these Benches that safe havens be set up and that adequate protection be given by United Nations forces to the Bosnian Serbs. Those proposals have been consistently resisted. At that time they would have provided safe havens which were viable, which could have been protected and which would have provided the Bosnian Moslems with some way of life. Now, the Government have come round to those proposals in almost every detail except that the areas to be protected will be so small that they will be little more than refugee camps and, essentially, incapable of supplying themselves with the wherewithal for survival. This is a sad and deplorable tale. Moreover, as regards those protecting these enclaves —French, British, Spanish and Canadians—there are some notable absentees: the Germans, for so-called constitutional reasons, but, more importantly, the Americans and other members
70
of the European Community. If, as we are told, we are forming a common European policy, in common ventures of this kind the absence of colleagues from the Community in these operations cannot fail to be noticed and deplored.
The communiqué reads:
"We note the pledge of the Belgrade authorities to close the Bosnian border and to put pressure on the Bosnian Serbs to accept the peace plan".
I repeat the question asked by the noble Baroness, Lady Blackstone. Does anyone believe that statement? What faith do we put in Milosevic's words? How effective will the pressure be? Will they allow monitors in sufficient force to make those sanctions effective? Though the ultimate objective may be,
"the withdrawal of Bosnian Serb troops from territories occupied by force",
there is—and I again repeat the point made by the noble Baroness—no mention of the areas to be given up and precious little sign of the political will that is necessary to make that happen. If the end of slaughter is of course desirable, it is also desirable to take steps to prevent the conflict spreading. That is a real international danger. One of the two danger points is Macedonia. What is the size of the international presence there? Is it sufficient? Is it being reinforced? The other danger point is Kosovo. What steps are being taken to see that the human rights of the Moslems in that crucial area are being properly protected?
If this is the first test of the move announced at Maastricht towards a common foreign policy and towards building a new pillar, it is profoundly disappointing. In another place this afternoon the Minister kept on referring to the absence of will on the part of the public to enforce more stringent measures. What, we have to ask ourselves, is the will of the Government? It is they who have to make policy; and it is they who should be leading public opinion, not appealing and explaining that public opinion renders them impotent.
Viscount Cranborne: My Lords, I am grateful to the noble Baroness, Lady Blackstone, and to the noble Lord, Lord Bonham-Carter, for welcoming elements of the Statement. I shall endeavour to address myself in so far as I am able to the large number of questions posed by the noble Baroness. Her first question on the effectiveness of sanctions was one to which the noble Lord also addressed himself. She asked in particular whether we could believe the Serbian Government's undertaking which resulted directly from the Athens agreement.
Both the noble Baroness and the noble Lord have enough knowledge and experience of that part of the world, as indeed do Her Majesty's Government, to recognise that it is unwise always to take the movers and shakers in that part of the world at their word. We are extremely conscious of the need to believe it when it happens. It is for that reason that a great deal of trouble is being taken to make sure that the sanctions; the undertakings that the sanctions are properly monitored between Serbia and Bosnia; and the undertakings given by the Serbian Government are

71
addressed. To that end the governments and the Security Council will make sure that adequate steps are taken in that direction.
The noble Baroness, Lady Blackstone, also asked me effectively whether the Vance-Owen plan is dead and how can we build on a process by implication rather than on sound foundations. That was a very fair question. We have to recognise that the Vance-Owen plan has already produced some proposals which specifically include the withdrawal from territory taken by the Bosnian Serbs. That is what we have to build on and also endeavour to achieve. The noble Baroness also addressed the question of pressures to try to assist and accelerate that process. They are already being intensified. The agreement that was announced this weekend in America is one important step down that road.
Perhaps I may elaborate a little on what I mean by that. There has been a good deal of speculation in the press of late about the dangers of a division between the United States and Europe in the way in which they address the thorny question of Bosnia and the former Yugoslavia in general. It is fair to say that an important element of reassurance has been achieved during the course of the deliberations in the United States. I believe that we can safely say that the suspicions voiced in the press of late have been put behind us and that there is now a unanimity of view, both in Washington and in the principal capitals of Europe, about the process which we must now employ.
As regards whether the noble Lord, Lord Owen, was consulted, I am sorry to say to the noble Baroness that I cannot answer that question. I shall certainly endeavour to do so and write to her immediately. Both the noble Baroness and the noble Lord asked about safe areas. They will be well aware that the idea of safe areas is given a favourable reference in the communiqué which they have both clearly read. The phrase used in it is that they,
"could make a valuable contribution".
What is clearly important—and this underlies the general tenor of the answer that I am endeavouring to give to your Lordships—is that whatever we do in Bosnia has to be judged by two criteria: first, is it going to work in the context of our objectives and, secondly, is it going to be proposed by the Security Council in a spirit of unanimity? We have to make sure, according to both criteria, that, whatever policy we develop as regards safe areas, it must be a policy which is sustainable and which will work. I readily understand the impatience of the noble Lord, Lord Bonham-Carter, on this matter. At the same time I say to him that I would rather take time over a policy and make sure that it has a chance of working, rather than rush into it and find that it is not sustainable.
The noble Baroness also asked whether an independent Bosnia is something which can survive. The matters to which she addressed herself and to which I am endeavouring to address myself now, are designed for exactly that to happen. The pressure as a result of sanctions on Serbia and the Bosnian Serbs,; the enforcement of those sanctions and all the pressure
72
which we have been endeavouring to build up over the past few months, are designed to that end. I cannot predict whether that will work or not. All I can say to the noble Baroness is that there is clear evidence that sanctions are beginning to have a considerable effect.
As regards Macedonia and whether the conflict is likely to spread, I agree with the noble Lord, Lord Bonham-Carter, that that is the real question which should concern us. I draw his attention again to the communiqué which he has obviously studied with some care. Under the heading,
"Former Yugoslav Republic of Macedonia"
he will have noted—and perhaps I may quote briefly from it—that the communiqué says:
"It is essential that everyone in the region understands that aggression against the former Yugoslav Republic of Macedonia would have grave consequences. We will support an increase in the international presence there in consultation with the authorities in Skopje. The United States is considering a contribution to this effort".
I believe that all of us are aware that in terms of the risk of the conflict spreading beyond the borders of the former Yugoslavia, Macedonia occupies perhaps a more dangerous place than many others. That is the reason why I believe that that particular clause was so much emphasised during the course of the drafting of that statement.
I also sympathise greatly with two of the other remarks made directly by the noble Lord, Lord Bonham-Carter, and more by implication by the noble Baroness. We are well aware of the remarkable contribution made by British troops in their humanitarian efforts in Bosnia. We are also aware that there are other nations who have contributed in a slightly less prominent way. We feel that there will be more troops needed in Bosnia and that it is up to the United Nations Secretary General to find those troops. We understand that there is a possibility that the Russians may be able to contribute a contingent. We shall see. I sympathise greatly with what the noble Lord said.
As regards the way in which we debate this important question in your Lordships' House, I can only add that I am sure that my noble friend the Chief Whip, even if he were not here to hear the noble Lord's remarks, will have them reported to him en clair at the first opportunity.
Lord Boyd-Carpenter: My Lords, can my noble friend confirm that it remains the policy of Her Majesty's Government not to agree to any measures in this unhappy situation which are likely to result in serious risk of death or injury for members of Her Majesty's Forces?
Viscount Cranborne: My Lords, I would be less than honest with my noble friend if I were to give him the absolute assurance for which he asks. After all, several thousand members of Her Majesty's Forces have been risking themselves to some considerable extent over the past few months. The task which those forces have been carrying out has been very clearly defined indeed. Perhaps one of the reasons why the casualty rate has been so low is that the Ministry of Defence and the senior officers who have been running this operation in particular, have been very careful to

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follow the strictures so carefully enunciated by Field Marshal Sir Richard Vincent in another forum recently, that any operation of a military nature must above all have a clear objective.
I say also to the noble Lord that one of the reasons why there have been so few casualties is that our soldiers have been issued with the right equipment, not least of which is the Warrior armoured personnel carrier which has proven its worth time and time again. Therefore, I say again to my noble friend, that I cannot give him the absolute assurance which he needs. But the safety of our troops is certainly our prime objective. The last thing in the world that we want to do is to send them into an ill-defined civil war and put them at risk when the good that they can do is not entirely clear.
Lord Cledwyn of Penrhos: My Lords, while I recognise the complexities of the scene in the former Yugoslavia, which the Minister has described, does he agree that the core of the current problem is that, through aggression and ethnic cleansing, the Serbs have acquired 70 per cent. of the land of Bosnia? Is it the case that the Washington communiqué gave hope that the matter would now be resolved, if gradually? However, does he agree that sanctions themselves, however effective, will not persuade those Serbs to retreat from the land they have acquired? If he believes that they will, he should tell the House that that is the Government's view. If not, what other solution do the Government and their allies have in mind?
Viscount Cranborne: My Lords, the record of sanctions in achieving their objectives at speed has not been universally reassuring. Nevertheless, there is no doubt that over a long period they have a severe effect upon those at whom they are directed. Let us wait to see whether in this matter the judgment of what I am told is the international community is vindicated. We are conscious of the dangers, as, I am sure, is the noble Lord, of becoming involved in a civil war in the sort of amorphous conditions which I tried to describe to my noble friend Lord Boyd-Carpenter. We hope and believe that the sanctions will extend the effect of the Vance-Owen peace plan so that we can begin to exert pressure on the Serbs to withdraw. I cannot guarantee that. Much as I would like to, I cannot guarantee that anything will happen in the Balkans. All I can say is that that is the judgment so far. We shall see whether we are right or wrong.
The Earl of Onslow: My Lords, my noble friend on the Front Bench reminds me irresistibly of Mr. Bottomley and Mr. Wilson talking in 1965 about sanctions bringing down Rhodesia. Is not it the case that we have provided a fig leaf which says that the Serbs have won and that we now have to pretend that it has not happened? Would it not be much more honest to say, "They have won. We are not prepared to do anything. We are not prepared to sacrifice any soldiers". The bones of a Pomeranian grenadier, as Bismarck said, are not worth bolts spreading to the
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Balkans. Would not it be much more honest to say that they have got away with it, however unpleasant that may be?
Viscount Cranborne: My Lords, my noble friend tempts me, strangely, to go down memory lane in the matter of Rhodesia. I shall resist that temptation so far as I am able. I remind your Lordships and my noble friend that sanctions are designed, above all, to achieve a clear objective, which is the withdrawal from territory gained, over and above what they should have, by the Bosnian Serbs. We believe that in the end sanctions have an effect. It is open to debate whether sanctions are always effective without other kinds of help. Nevertheless, they are effective in the long run. I ask my noble friend merely to follow the advice that I endeavoured, rather impertinently, to give to the noble Lord, Lord Cledwyn. We should wait to see whether they work.
Lord Merlyn-Rees: My Lords, I have wondered for some time whether we would have a Statement or debate in our House on what is happening in the former Yugoslavia. From reading the American newspapers, one sees that change has been taking place imperceptibly. I am surprised therefore that our chance to mention the matter today should arise as a result of a Private Notice Question and not even a Statement. Like the noble Lord, Lord Bonham-Carter, I hope that we shall have a chance to study the matter carefully. I, for one, am glad that this country has not been drawn into a real war in Yugoslavia. There are many commentators who confuse the position with Iraq and the Falklands and who know not those valleys and that part of the world where civil war has continued for centuries. To that degree, I still commend the Government.
However, despite today's Statement and the Washington statement, I am none the clearer about what is happening. If we do not have a debate, the issue will come up in the Maastricht debate. Because what does a European foreign and defence policy mean? The Germans and Italians, in particular, have a great deal to answer for in recognising Slovenia and Croatia last year. There has not been a European policy. It has been a failure, and not even a glorious one. If we do not have a debate in the House the subject will come up in the Maastricht debate. I am sure that it is relevant.
Viscount Cranborne: My Lords, I am sure that the noble Lord is right when he draws attention to the danger of being sucked into a Balkan quagmire. I am sure that that is the common view held by every government who address themselves to this question. No one wants that to happen. On the subject of a debate, I am sure that my noble friend on the Government Front Bench will have heard the remarks of the noble Lord and of my noble friend Lord Boyd-Carpenter, and, as is always the case in your Lordships' House, due and careful note will be taken of them.
Baroness Elles: My Lords, will my noble friend say more about the war crimes tribunals which he mentioned at the end of his Statement? Have any

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terms of reference been drawn up as to any conditions under which they will be working? Have rules of evidence been laid down as to how alleged criminals will be arrested? Finally, will my noble friend say whether those engaged in committing the atrocities in the former Yugoslavia are informed that they will come before war crimes tribunals if they carry on in the way in which they have been carrying on?
Viscount Cranborne: My Lords, my noble friend will be aware that considerable publicity has attached to the question of war crimes tribunals. I am sure that that publicity has been well noted and listened to in Bosnia. So far as concerns what one might call the modalities of this idea, noble Lords will be aware that Her Majesty's Government support the rapid establishment of war crimes tribunals so that those guilty of atrocities may be brought to justice. In pursuance of that, I am told that a Security Council resolution is likely this week. I must add that a tribunal does not come into effect unless people are within its jurisdiction. In important respects, that is not yet so. Nevertheless, we believe that it is important to establish publicly, for the benefit of people who might be ordered or tempted to commit atrocities, that they will carry an individual responsibility, which was the point that my noble friend made.
Lord Stoddart of Swindon: My Lords, is the Minister aware that there are many people, certainly myself, who are relieved that the American military and the American people have persuaded President Clinton not to arm the Moslems and not to embark upon military air strikes in Bosnia at present? Is he further aware that the right course now, as well as keeping on the sanctions of course, is to do everything possible to bring the parties together to discuss the question again and again until they reach agreement as to how Bosnia should be divided, if that is the final answer? Will additional British troops be involved? Or shall we be able to withdraw any troops under the present circumstances? Will the Minister also reply to the question asked by my noble friend Lady Blackstone—I do not believe that he did—about what action will be taken to police the border between Serbia and Bosnia?
Viscount Cranborne: My Lords, I referred with some enthusiasm to the unity of view which prevails between the United States and its European allies. All sides of the House will welcome that state of affairs. At present there is no suggestion that the Bosnian Moslems should be armed. Indeed, it is generally recognised that that course of action carries considerable dangers.
As regards bringing the parties together, it must be common ground that any kind of settlement must be achieved through consent rather than enforcement. I am grateful to the noble Lord, Lord Stoddart, for enabling me to underline that point. A number of dangers—of which your Lordships will be well aware —are attached to the enforcement of a settlement. Not least are the dangers to our own people and of becoming involved in the kind of quagmire which
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many noble, Lords fear. Equally, if the settlement is not accepted by those who are affected by it, the implication is that those enforcing it will more likely than not have to remain for a considerable time. That is something which few, including the United Nations, can afford.
I apologise if I did not answer adequately the question asked by the noble Baroness, Lady Blackstone. As regards the enforcement of sanctions along the border between Serbia and Bosnia, we take that extremely seriously. Monitors, or teams of monitors, are being suggested to ensure that the crossing points are properly monitored. I am aware of a report in the weekend press suggesting that some border points are not adequately monitored. I am sure that the example referred to in the press report will have been noted with some care.
Lord Stoddart of Swindon: My Lords, will the Minister comment on the use of British troops?
Viscount Cranborne: My Lords, I beg the noble Lord's pardon. I thought that I had answered the question about British troops. At present there are no plans to add to their number nor to vary their existing humanitarian task. I said that it is hoped that the United Nations Secretary General will find the troops from elsewhere. It is hoped that the Russians will be able to make a contribution.
The Earl of Lauderdale: My Lords, does my noble friend accept that as an aim the principle of containment must carry general acceptance far and wide as far as it goes? Secondly, does he agree that the aim of keeping out of a civil war must command support in general? However, will the Government bear in mind a new threatening danger which has not yet been mentioned; that is the possibility of the outbreak of civil war in Serbia? Milosevic is losing ground. His chief rival Seselj, who is a Bosnian, is rallying a great deal of support against concessions to the West. While we all wish to press Milosevic—I should like to string his neck—counter pressures exist. We must tread most carefully with regard to the Serbs, however angry with them we may be.
Viscount Cranborne: My Lords, I am sure that it behoves all of us in your Lordships House to listen to my noble friend Lord Lauderdale, whose knowledge of matters Yugoslavian is well known. We are well aware that the situation in Serbia is complex and that a number of political cross-currents are at work. I am sure that the House will have noted my noble friend's comments. I too emphasise that the American statement addressed itself very much to the activities of Croats within Bosnia and that the possibility of sanctions being imposed on Croatia only adds to the general complexity of an already complex question.

Disabled Persons (Services) (No. 2) Bill [H.L.]
7.25 p.m.
Read a third time.
Lord McColl of Dulwich: My Lords, I beg to move that the Bill do now pass.
Moved, That the Bill do now pass.—(Lord McColl of Dulwich.)
Baroness Hollis of Heigham: My Lords, as the only opportunity that we had to debate the Bill at length was on Second Reading I wish to make a few comments. The Bill was uncontroversial and therefore, apart from the formal amendments, no amendments were tabled in Committee or on Report. Perhaps the House will allow me to make a few comments on behalf of Members on these Benches as regards some of the issues which arose on Second Reading but which we were not able fully to explore.
First, I wish to congratulate the noble Lord, Lord McColl, on introducing the Bill and seeing it through the House. I also congratulate the Minister, the noble Baroness, Lady Cumberlege, on the charm if not the conviction with which she sought to rebut our arguments. I hope that even at this late stage, as we wish the Bill well in another place, we may seek to persuade her that at least in principle the Bill is right to be supported.
I wish to return to some of the issues that were debated on Second Reading and which the Minister sought to challenge. She then made the point that to introduce cash payments for local authorities to aid the disabled was to introduce a new principle which would blur the line between the DSS and the social services; or to use the Minister's effective phrase, to make a social security system of social services. That argument would be more plausible if local authorities were not making cash payments every day of the week to adults fostering children, to adults playing hockey or tennis, or to adults running arts, voluntary and caring organisations —except to those who happen to be in wheelchairs. What on earth is the moral difference between paying a monthly amount to a disabled person in cash or, as local authorities are permitted, paying a somewhat larger monthly amount to a charity which dispenses it as smaller monthly amounts to two disabled people? Of course, there is no moral difference but there is plenty of practical difference, such as the cost and the time wasted in bureaucracy. Frankly, that is somewhat insulting if one happens to be disabled. In other words, at present local authorities may not pay cash to the disabled but they can give money to a charity to give it to the disabled, which apparently is okay.
The second argument which the Minister offered in Committee was that paying the disabled in cash rather than providing services in kind might generate escalating costs. That is not so. The argument which came from all sides of the House was that this was a no-cost option. Indeed, I suggest that it is easier to control, to cap, a cash budget than a services budget where salary costs might rise higher than inflation
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Cash is a straight alternative at the discretion of the local authorities if they believe that it offers better value for money. As a former chairman of the finance committee of a local authority I saw that it was much easier to control the cost of grants to voluntary organisations—for example, a sporting organisation —than to control the costs of a sporting organiser employed in-house by local government. That is undeniable.
It is also a limited option appropriate especially for younger clients and spinal injuries clients who are used to being in control of their lives. In the past, such clients turned to the ILF.
The Minister also suggested that local authorities might have problems in defining eligibility, but why should they? The social work assessment would steer clients into service-based or cash-based packages of care, whichever was the more appropriate and whichever represented better value for money. I seek to find words of support from the Minister in pointing out that the Bill will give local authorities a discretion in deciding which path to go down as regards the clients who they believe will be most advantaged, which is a discretion that they desperately want.
The third point—and I do not believe that we disagree about this—is that the cash payments can represent a more dignified option. The Minister rightly accepted in well-chosen words that issues of personal dignity and autonomy are at issue here. She said that there is no reason why a care assistant should not be personally chosen by the disabled person. We are talking about the need of a disabled person to have personal help in such intimate functions as toileting. Having led for the opposition party on a social services authority, for the life of me, I do not know how the Minister's assurance that a disabled person can chose his own care attendant, even though that person is a local authority employee, can operate. Perhaps the Minister will tell me how it can operate. In no way can clients choose who the authority employs nor can they determine how the local authorities do the rostering and so on which is essential if they are to maintain an effective and value-for-money personnel budget. Clients simply cannot pick and choose and I do not know why the Minister thinks that they can. That is precisely our complaint.
The fourth point that I wish to raise is that I was not sure whether the Minister in her remarks in winding up the debate on Second Reading had taken fully into account the implications of the Disability (Grants) Bill which was handled by the sister department, the DSS. The Minister will not need me to say that if someone needs £190 worth of care, that will be provided in the form of services from the local authority. However, if a package of £400 worth of care is needed, then the person will receive £200 worth in the form of services from the local authority and £200 in cash from the ILF.
Therefore, those two Bills are proceeding through your Lordships' House in parallel but it may be that no connection is being made, as there should be, between the two Bills. Will the Minister tell us how the combination of cash and services will work? Will the

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local authority pay a person of its choice to go in and get somebody up in the morning, feed them and toilet them and then put that person to bed at night and toilet and feed them while in between, at lunch times and over night, somebody else would be employed and paid by cash from the ILF fund? That is the kind of boxing and coxing in personal care for the severely disabled which cannot be sensible.
As was said in that debate on the ILF, community care is about avoiding residential care. And yet people go into residential care not because their disabilities are worse but because their informal care arrangements have broken down. All research into ILF money shows that cash grants, because they are cash, buying perhaps 20 hours of formal care, allow their clients to leverage a further 60 hours or so of informal care out of the system because the money is spent on respite care, on additional paid hours, on reimbursing expenses, on travel costs and so on. In other words, cash payments, which is what the Bill seeks to empower local authorities to make when they believe it to be appropriate, can network and therefore stretch informal caring. By definition, formal professional services cannot do that. Permitting clients to receive only formal services from local authorities means that they are less able and likely to keep that informal net afloat. Therefore, disastrously, they end up needing even more formal services which, sadly, the local authorities are often financially unable to provide.
I do not believe that there is a difference of principle between us. The Minister Mr. Scott made clear in another place on 27th April that if local authorities can devise schemes which are lawful—for example, using local charities—he would not oppose them. He seems to be saying, "I will not change the law but you are welcome to get around it with my blessing. You bend it because I cannot or will not amend it". That is a curious base for social policy.
Originally I thought that opposition to the Bill came from the DSS and the Treasury. The Minister made it clear that the Bill receives no government support. However, it seems that provided costs are capped, which I believe they are, the DSS and the Treasury may be open-minded on the issue. Certainly a letter from Mr. Lamont to Jane Campbell, one of his disabled constituents who is active in the disability movement, makes it clear that he has no objection in principle to cash payments but says that the Department of Health has serious reservations about that. What is the line of the Department of Health? Why does it have such serious reservations? We have discussed the argument about blurring the lines but, as I have argued, the lines are already regularly blurred, and are blurred all the time in Scotland. We have discussed the argument about escalating costs and I have tried to argue that that is not the case. We have discussed the implications of the new Disability (Grants) Bill. What is the department's argument? Why is it that, despite the Treasury and the DSS apparently being open-minded, the Department of Health appears to resist the Bill?
As far as I can tell, the argument advanced by the Secretary of State and by the Minister is that
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inevitably local authorities are heavily burdened with new care in the community responsibilities. Therefore, it is unwise and unkind to give them new responsibilities until care in the community has properly bedded down. Yet the research of Pauline Thompson, the director of DIG, shows that local authority directors of social services want the power to pay cash because they believe—and they are running the service on the ground—that it will free them, rather than encumber them, from some of their load. Why does the Minister insist that the cash payment is an additional load when those who must administer it say that it will lighten their load? What evidence will the Minister be willing to accept to the contrary? If there is no evidence, we are simply talking about ideology.
After all, local authorities can dower their clients with a cash assessment which could then be integrated by the ILF with its own financial packages and be monitored by the ILF. That would bring simplicity, clarity, autonomy and value for money. The Minister should find quite irresistible the arguments for giving a discretion to enable local authorities to make cash payments to the disabled, especially where those disabled are also receiving cash payments from the ILF. I am genuinely baffled that she does not do so. I ask the Minister what she would like for herself or her husband. I ask what the civil servants in the Box would like for themselves. Anything less than what they would like for themselves, within cost constraints, is not good enough for disabled people.
Finally, if the Department of Health continues to repeat the doctrine of unripe time while agreeing that cash payments may be acceptable in principle and may ultimately be made, will the Government indicate whether they might accept an amendment in another place giving the Secretary of State the power to determine when the Bill comes into force? In other words, the Bill would pass through both Houses and reach the statute book but it would be brought into effect only when the Secretary of State thought it appropriate. That would meet the Minister's objections that the Government do not wish to overburden local authorities at present. I do not share the Minister's views as to the argument but if that is a way of attracting government support for the Bill, that would be a welcome path to take. Such an amendment would allow that additional discretionary power for local authorities to come into being when the Secretary of State thought that the time was appropriate. It would not require further legislation. In such circumstances, will not the Minister, at last, indicate some support for the Bill?
7.38 p.m.
Baroness Cumberlege: My Lords, I take this opportunity to congratulate my noble friend upon the clear and concise way in which he has expeditiously steered the Bill through your Lordships' House. Despite my noble friend's powers of persuasion, which are considerable, I regret to inform your Lordships that the Government's position has not changed since Second Reading. As the noble Baroness, Lady Hollis, said, no amendments have been tabled.

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Local authorities are enablers, facilitators and providers of care services. It is not their core business to provide cash to support individuals in need. It would be difficult for them to manage a general system of cash payments, including defined eligibility and monitoring, to keep control over public funds. We believe also that now is not the time to add to the workload of local authorities.
We have listened carefully to the arguments put forward in support of direct payments, not least those put forward by noble Lords opposite. However, we believe that there is a significant risk that over time the link that the Bill makes between services and payments will be broken. There will be expectations of the going rate for particular conditions, irrespective of people's assessed needs and the services which would otherwise have been provided. That would put additional pressures on local authority resources which could be met only at the expense of other client groups and services.
The noble Baroness mentioned the arrangements that local authorities make with charities. That is a matter for them and for the Audit Commission. The Government would not wish to intervene. With regard to the users of services, local authorities are free to contract with anyone for the provision of care services, including individuals acting as personal care assistants. When the care plan is drawn up by the local authority, the independent living fund and the disabled person, we certainly expect the local authority to make sure that the person has as great a say as possible in the type of service to be provided and by whom it is to be provided.
We are at one in our motives, but not in our methods. It is with considerable regret that we cannot, therefore, support the Bill. However, I do not seek to oppose its Third Reading.
Lord McColl of Dulwich: My Lords, I am most grateful for the contributions made in this evening's debate. I should also like to thank the noble Baroness, Lady Hollis, for her spirited defence. I do not think that the guessing game of which civil servant was responsible for not supporting the Bill, or which particular department is responsible, is all that profitable. Any government has to be prudent as regards not letting public expenditure get out of hand.
Government is always much more complicated than it seems. It is always easy for those of us not in government to attack the Government at every opportunity. But, of course, I have to remind the noble Baroness, Lady Hollis, that one day she may become a Minister in a government, perhaps in about ten years' time—that is, if she changes party—so we must be prudent in how we attack, and so on.
Again, I should like to thank everyone for their support this evening.
On Question, Bill passed, and sent to the Commons.
Viscount St. Davids: My Lords, I beg to move that the House do now adjourn during pleasure until 8.25 p.m.
[The Sitting was suspended from 7.42 to 8.25 p.m.]

Trade Union Reform and Employment Rights Bill
Standing Order No. 44 having been dispensed with (pursuant to Resolution of 20th May):
Viscount Ullswater: My Lords, I beg to move that the report be now received.—(Viscount Ullswater.)
Lord Stoddart of Swindon: My Lords, I do not wish to delay the House for very long but I really must make my objections known to the procedure which we are adopting at this point in time. We are supposed today to be debating the Bill on Third Reading, and following Third Reading we are to have a debate—or we should have a debate—on the Motion of whether the Bill do now pass. It is now 8.25 p.m. and we still have to discuss the Government's new clause on Report, to which I understand amendments have been tabled. I do not know how long the amendments will take, but it is likely that we shall not reach the Third Reading of this important Bill until 9.30 p.m. at the earliest.
On virtually every day this Bill has been debated the House has sat until the early hours of the morning. A great deal of hard work has been put into the Bill and we are now to discuss the Third Reading at 9.25 p.m. or thereafter. Frankly I believe this is a disgraceful abuse of the procedures of this House and it treats the Members of this House with utter contempt. I implore the Government—it is unfortunate that the Chief Whip is not here; I was not able to find him to give him notice that I wished to raise this point—to take a message to the Chief Whip and to tell him we consider the Members of this House are being treated with contempt. I hope the Minister will ask the Chief Whip to move for the closure of debate so that we can take the Third Reading of this Bill at a more appropriate time on a future date.
Viscount Ullswater: My Lords, I note carefully what the noble Lord, Lord Stoddart of Swindon, said. I can only say that we have discussed the process of what was going to happen today through the usual channels. I thought it would be for the convenience of the House if the new clause that the Government were moving should be considered in Committee rather than after Third Reading. That is why I made the proposal to go back into Committee to discuss the new clause. We had the opportunity to do so earlier today. However, I note what the noble Lord said. I believe it is still quite proper that we should continue with the process —as we have been doing today—and that we should now move on to Report.
Lord Wedderburn of Charlton: My Lords, is not the objection that my noble friend makes much stronger than the Minister allows? There are a number of noble Lords who are concerned about a number of provisions that will arise on Third Reading. There is not a horde of other noble Lords waiting at the gates to discuss the Government's new clause. Some of us have to plough on through this unfortunate new

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clause of the Government at Third Reading. Surely there is a case for saying that the convenience of the majority who are interested in the other clauses of the Bill might be given some priority.
I hope that it will not be thought that those of us who have been concerned primarily with the new clause wish it to obstruct our noble friends who want to discuss the rest of the Bill. I want to make that absolutely clear and I am sure that my noble friends on the Front Bench agree.
The noble Viscount is right to say that certain matters were agreed through the usual channels, but surely we are sufficiently flexible and not bound by the hidebound rules of some agreement. We did not know how long the Committee stage would take. No one could tell that. I am sure that everyone would feel that we could be flexible enough to allow those who wish to proceed to the Third Reading of the other clauses to do so after dinner and for those of us who have to discuss the Report stage of the new clause to wait until after that discussion.
8.30 p.m.
Viscount Ullswater: My Lords, I believe that the Bill has been very well discussed during the course of both Committee and Report stages. Whereas I shall deal with the amendments after Third Reading as diligently as I trust I dealt with those during the Committee and Report stages, I ask the House to accept the view that we should now move into Report stage on this particular clause and then deal with the amendments after Third Reading, I am afraid at a late hour this evening, but with due consideration for their importance in order to make progress with the Bill as we have discussed.
Report Received.
Lord McCarthy Lord McCarthy moved Amendment No. 1:
In the new clause Line 7, leave out ("his relationship with") and insert ("the terms and conditions of employment of")
The noble Lord said: My Lords, I do not want to go into any of the debates we had before we reached Report stage, except to say that we on this side of the House regret that we are in this position. We agreed to deal with the situation so that we could have a Committee stage on the new clause. Why we have to go straight from Committee stage to Report stage is a different issue. However, we are in Report stage and I shall move Amendment No. 1.
The amendment is intended to amend the critical subsection 3(a) of the new clause so that instead of referring to a change in the relationship it refers to terms and conditions of employment. We do so for several reasons. One of the major reasons is that, as we said in Committee—and we received no reassurance from the Government—the Government have drawn that extremely wide. It refers to an employer's intention:
"to further a change in his relationship".
We do not know what kind of change in the relationship. We have said that almost anything could be said to be covered by that part of the clause.
The employer might introduce team briefings. He might say that introducing team briefings changes the relationship and he is now entitled to deny his employees collective bargaining. He could introduce total quality management audits. He could introduce semi-autonomous work groups. He could say, "I believe that my relationship with my employees would be significantly changed if they had a new suggestion scheme or if I had a management appraisal system". Almost anything could be put forward and said to be furthering a change in the relationship. The employer does not have to prove that it will produce a change in the relationship. As my noble friend said, he merely has to swear an affidavit and by the very submission of that as evidence everything which might be advanced under paragraph (b) is totally ruled out.
Then, as we know from what the noble Viscount said to me at the end of the Committee stage, a whole range of penalties can be imposed upon those who want to retain their union membership. They could be told that there will be no more wage increases for them. They could be told that there will be no more promotion for them. They could be told that they will be downgraded because they are no longer in the group which the employer wants to favour in order to produce a change in the relationship. All those things could be done.
We say that that could not in any way be said to be justified, or even related to the kind of decisions reached in the Court of Appeal. We believe that even at this late stage the Government ought to be prepared to accept a modification of paragraph (a) in order to place some limitation on what the employer would have to indicate in order to qualify for the easy way forward provided under the terms of the Bill. We say that the paragraph ought to be changed so that the employer has to show that he is dealing with the terms and conditions of employment.
That still leaves a very wide area which the employer could say that he wants to change. Most of the reasons that are advanced for such action in relation to individual contracts would be covered by reference to terms and conditions of employment. If the employer wanted to introduce a new system of appraisal that would probably be covered. If he wanted to move to a system of performance related pay he might have to show why that was necessary. That would be a fairly wide interpretation, although not as wide as the very wide interpretation that could be put on the clause as it stands. I beg to move.
Viscount Ullswater: My Lords, the amendment would mean that instead of there being evidence that the employer's purpose was,
"to further a change in his relationship with all or any class of his employees",
there would have to be evidence that his purpose was to further a change in the terms and conditions of employment of all or any class of his employees.
In our view the amendment would narrow the scope of the purpose to which the tribunal would be directed to have regard. Thus, if an employer wished to bring about a change in his arrangements—for example, collective bargaining—which did not form part of the terms and conditions of employment of the

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individual employees, then the new clause would not direct the tribunal to regard that as the employer's purpose. The Government's policy does not draw a distinction in that way. The important point is that the employer should be free to bring about a change in his organisational arrangements whether or not those are enshrined in individual terms and conditions of employment. I therefore ask the noble Lord to withdraw the amendment.
The noble Lord, Lord McCarthy, mentioned many other relationships, but then he did not really fail to address the point, which I believe is an important one, of the action which was taken by the employer. That is what we have to decide: what action was taken by the employer. I must not fall into the trap of referring to a test of reasonableness, but then there is the question of whether the action is action which no reasonable employer would take having regard to the purposes mentioned in paragraph (a).
We feel that the amendment narrows the scope of the clause, and with that brief reply I ask the noble Lord to withdraw the amendment.
Lord McCarthy: My Lords, I am not sure whether the noble Viscount said that I did fail or did not fail to address the point. I thought that he said that I did not fail but I think that he meant that I did fail.
The noble Viscount said what we expected him to say. He said that the employer might want to change all kinds of things which are not in the terms and conditions of employment. If they are collective bargaining aspects they will be in the terms and conditions of employment; but, of course, the Government are not interested in that. They want the widest possible area in which the employer can argue one way or another and avoid his responsibilities under the other part of the clause. We are not surprised by that, but that being the situation, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 2:
In the new clause, line 7, leave out ("his relationship with") and insert ("the employment relationship existing between him and")
The noble Lord said: My Lords, the amendment flows from the Government's rejection of the earlier amendment on the Marshalled List. The noble Viscount's objection to the previous amendment was that it would leave matters too narrow. On Report of course we have to debate the Bill within the limits of the Government's structure. If the employer were left with a purpose to validate his otherwise unlawful discrimination relating merely to terms and conditions of employment, that was too narrow. The amendment relates to a further problem. The Government's wording is still too wide. It is imprecise in a way which none of their examples suggest that they wish it to be.
The employer's relationship with all or some class of his employees—and "class" may be very small according to the definition of subsection (5)—may, especially in a small firm, relate to a large number of matters. We say that such matters should at least relate to employment. That is why we have chosen the phrase "employment relationship". That is wider than
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the reference to terms and conditions. Nevertheless, the phrase excludes certain other matters. On the Government's suggestions and presentations to date one would have expected them to agree to it.
For example, let us suppose that the employer in a small firm has made loans to all the employees. He wants to call the loans in because he fears for his liquidity. He calls in the loans. However, he first calls in the loans from the trade union members. That would be flagrant discrimination. Alternatively, in some way, perhaps not so flagrantly, he prejudices the trade union members as against the other employees. I refer to the employer's relationship with those employees qua creditor and debtor. In my example the relationship is quite outside the range of employment. It is quite unreasonable for the employer to be able to give as justification of his discrimination some relationship which is outwith the employment relationship.
Noble Lords might argue that that example came within the employment relationship. However, let us consider the case of a small family firm in which the relatives of the wife who are employed in the firm have always been staunch trade union members but the relatives of the husband, who is in control, are not. For reasons which are intimately connected with his relationship with the wife and her side of the family, the husband makes decisions which are easily seen as prejudicial to her relatives who are employed. As the example stands, it would fit the Government's clause. As the provision stands, the employer can say, "I want to further a change in my relationship with a class of employees". Class is easily defined. The relationship is easily shown. The discrimination is easily shown. But at that point the drawbridge comes up. No one can refer to the Section 146 discrimination.
Although that may be an improbable example, good legislation always take account of the least probable example. Good legislation would have to provide for that situation. I imagine that we would all agree that that example should not fall within the range of what we debate. However, the Government's clause brings it within range. That suggested purpose is within a purpose to further changes in a relationship with a class of employees. Yet in a sense it has nothing directly to do with employment but only indirectly. One can think of hundreds of examples. Even in large companies one can think of good examples where the discrimination would not necessarily come within the employment relationship but within a relationship which one or more of the employing companies in a group had with a class of employees.
I appreciate that the hour is late. If the objection to our amendment is an infelicity of words, I shall be only too happy to join with the Minister in finding the right phrase. But we say that, having rejected all the other arguments and taking the Government's objectives for what they are, at the minimum there must be words to provide that there is evidence that the employer's purpose was to further a change in his employment relationship with all or any class of his employees. If the Government have not noticed how widely they have gone outside those employment

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relationships, it is not too late for them to suggest that I withdraw the amendment but that they will bring forward a better form of words at Third Reading.
At the very minimum can we not avoid the obvious litigation which will occur in tribunals around the word "relationship"? "Relationship" invites litigation. It is too wide. I beg to move.
8.45 p.m.
Viscount Ullswater: My Lords, I am grateful for the explanation given by the noble Lord; and the explanation that it seeks to lead on from the first amendment moved by the noble Lord, Lord McCarthy.
I was confused by the examples that the noble Lord gave. Those that he gave seemed to me to penalise members of the trade union only. When he spoke of loans to companies and pulling loans back, I believe that he tripped into a situation which might easily fall foul of the section. We do not seek to remove individual protection from trade union members. I have said that on numerous occasions from the Dispatch Box. The amendment that he proposes would limit the circumstances in which an employer might legitimately seek to alter his negotiating arrangements and limit the situation in which an employer's action would not be in breach of Section 146.
I have already explained the provision, drawing it down to a very narrow focus. The Court of Appeal found in a recognition situation that there are at least two relationships: the contractual employment relationship between the employer and the employee; and that between the employer and union which affects the relationship between employer and employee. An employer might legitimately seek to further a change in either or both. He need not be limited by changing his direct contractual relationship with his employee, as this amendment seeks to achieve.
The intention of the noble Lord is obviously to make the wording of the new clause as clear as possible on the face of the Bill. I understand that that is his interpretation. However, we shall have to agree that our interpretations are different. I therefore ask him to withdraw the amendment.
Lord Wedderburn of Charlton: My Lords, the record will show that, by refusing any part of my argument, the noble Viscount accepts that discrimination on trade union grounds which takes place during the course of a furtherance by the employer of a change in a family relationship within the firm, would be protected by the clause which the Government have introduced when the employer, as the noble Viscount rightly states, would otherwise fall foul of Section 146. The clause is a universal referee blowing a whistle in favour of one team only. The whistle blows whenever there is furtherance of a relationship be it family, creditor or debtor. Perhaps I did not choose the example well. I referred to a case of discrimination in a relationship between employer and employees as creditor and debtor which fell outside employment.
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Not to accept that employment relationship is what is meant in the provision is quite remarkable. I have a shrewd suspicion that when the courts get their hands on the provision, they may imply that the clause probably means employment relationship. We shall then no doubt have the Government coming back with further legislation to put the clause right. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 3 and 4 not moved.]
Baroness Turner of Camden Baroness Turner of Camden moved Amendment No. 5:
In the new clause, line 11, after ("shall") insert ("if the evidence shows that his principal purpose was not to discriminate against employees who were members of an independent trade union")
The noble Baroness said: My Lords, an amendment of the kind on the Order Paper in my name is absolutely necessary if the Bill is not to depart radically from the protection afforded by Section 146 of the 1992 Act or to breach ILO conventions. Again, we come back to the employer's purpose. If the employer's purpose is to deter individuals from joining or continuing to belong to a trade union, then his action should be caught by Section 146.
It seems fairly clear from the Court of Appeal judgment that the employers in both cases had as their purpose discouraging individuals from belonging to or continuing to belong to an independent trade union. In the Daily Mail case, when the employers de-recognised the union—and, incidentally, it is not in dispute here that the employers were, regrettably, entitled to do that—the employers, as we know, offered a 4.5 per cent. pay increase backdated to 1st October 1990 to all who signed their non-union contracts before 1st January 1990. I believe that that date was later extended. Those who did not sign because they still wanted some form of trade union representation did not receive the extra money. In the Daily Mail case that was what would have been their anticipated increase.
The Court of Appeal found that the ultimate purpose of the employers was to effect the wholly foreseeable consequence of deterring individual journalists from being union members. Unless an amendment of the kind I propose is accepted, the Government's new clause will legitimise actions which would otherwise be a breach of Section 146 of the 1992 Act. Is that the Government's purpose? If it is, they should say so. If that is the intention of the new clause, then it is in clear breach of ILO conventions which have already been quoted in the debate.
However, the Minister has already said that the Government do not want to remove protection from trade union members. He said so about 10 minutes ago in response to an amendment moved by my noble friend Lord Wedderburn. So the amendment seeks to define more precisely that that is what they may not do. It interpolates quite precisely:
"if the evidence shows that his principal purpose was not to discriminate against employees who were members of an independent trade union".
If the Government mean what they say—and I am sure that the Minister means it; he has said it very often from the Dispatch Box—that they do not want

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to remove protection from trade union members, then why does the Minister not accept the amendment which makes it clear that that will not be the purpose of the Bill? I beg to move.
Viscount Ullswater: My Lords, I am grateful to the noble Baroness for that explanation of the purpose of the amendment. It would provide that in a situation where a tribunal has evidence of two purposes for an employer's action and where the clause provides that it shall therefore consider the negotiating purpose to be the relevant purpose, it will only do so if there is not additional evidence of a principal purpose to discriminate against employees who are trade union members.
It is worth examining at this point exactly how the clause which the amendment seeks to amend would operate and why it has been constructed in the way it has. The clause has come into being to address a particular situation in which tribunals are in need of direction. To summarise, if they are offered evidence of two conflicting purposes for action by an employer which has led to a case being brought under Section 146, then they are now directed as to which of those they should regard as the purpose for which the action was taken.
That situation will only arise when two opposing purposes may, in retrospect, be attributed to the same act. It would have been possible when the clause was drafted to adopt the approach of identifying a principal purpose. In the event, though, we decided that the approach taken in the clause tabled by the Government offered a more satisfactory solution to this difficult problem.
To ask the tribunal to identify a principal purpose would in effect offer no progress from the current position where the law has become confused. The tribunal would have no guidance on how to determine the principal purpose. Our approach offers clear and firm guidance, leaving the tribunal free to concentrate on the facts of the case and the evidence put before it on which its decision is to be based.
Lord Wedderburn of Charlton: My Lords, if I may intervene, before the Minister passes from that point—
Viscount Ullswater: My Lords, we are at Report stage, but perhaps it is a question of guidance.
Lord Wedderburn of Charlton: My Lords, I am obliged to the noble Viscount for giving way. I understand that we can always give way to one another, even if we do not accept what we say. The argument which the noble Viscount has just put before us objects to the concept of the principal purpose. Does he apply the same reasoning to the long-established provision relating to dismissal? By it, the employer is liable for unfair dismissal if, for trade union or non-trade union reasons, as Section 152 puts
it,
if the reason for it (or, if more than one, the principal reason) was that the employee was … a member of … a union".
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That is a well known provision; the courts have not found great difficulty with it. Why is it so much more difficult with action short of dismissal than it is with dismissal?
Viscount Ullswater: My Lords, I was trying to explain why the Government sought to phrase the amendment in the way they did. I was trying to explain to the noble Baroness, Lady Turner, why we sought not to identify it in the way that the noble Lord has just suggested—that is, that it would be clearer for the tribunal to weigh up the evidence and then make its judgment on the basis of the amendment which we tabled and the new clause in the Bill.
I was about to say that, of course, there is the proviso at the end of subsection (3) of the reasonableness, that the action taken by the employer was such as no reasonable employer would take, having regard to the purpose mentioned in paragraph (a). We also touched on that.
I believe that the test for the evidence put before the tribunal should be clear. The amendment seeks to alter that and put in another proviso. I believe that the way in which we have formed the new clause is the right way and I ask the noble Baroness to withdraw her amendment.
Baroness Turner of Camden: My Lords, I am disappointed at that response from the Minister. I thought that we had managed to draft an amendment which perhaps would be acceptable in view of his statements on so many occasions that it was not the Government's intention to discriminate against or to support employers who discriminate against individuals who want to become or remain members of a union. As that was government policy, I thought that the Minister might be prepared to accept our definition of what one of the purposes would be.
I do not find acceptable his argument that leaving it as it is makes matters clearer for industrial tribunals. I should have thought that the reverse was the case. I find, as my noble friends have said, that the amendment as drafted is confusing. If it is the Government's intention that individuals should still have protection under Section 146, then it seems to me that it would be quite proper to accept the amendment. It identifies that purpose and proposes that the IT should take account of evidence of a purpose where it looked as though it discriminated against employees who were members of an independent trade union.
As for the qualification on reasonableness on the part of employers, it seems to me that that is open to doubt. What is reasonable in particular circumstances? An employer may say that it is reasonable to do what he is doing because the kind of advice he has been receiving from the Government for a long time has been that it is not a good idea to deal with unions and that he should bring collective bargaining to an end. Therefore, it may be regarded as reasonable that he should take steps in that direction.
I am not happy with what has been said by the Minister. I very much regret that this wording, which

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it seems to me is very moderate, has not been accepted. But at this late hour I do not intend to press the amendment and I beg leave to withdraw it.
Amendment, by leave, withdrawn.
9 p.m.
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 6:
In the new clause, line 15, at end insert ("and to the contractual and other rights of the relevant employees.")
The noble Lord said: My Lords, this amendment follows from my noble friend's proposal in the last amendment. Like all the other amendments debated and moved from this side of the House tonight, they are new points which were not dealt with in Committee. This is a small point but it could make a lot of difference to a few individuals. On that ground alone I would have thought that the Government could at any rate have a look at it. It arises because the tribunal has to undertake a difficult enterprise in applying the new clause. There is nothing new in that. Tribunals and courts often have to engage in difficult interpretation. But this new section has within it—taking lines 14 and 15—the test that no reasonable employer would have taken the action having regard to the purpose mentioned in sub-paragraph (a).
As I suggested in Committee, it is not a test of reasonableness as such, and I took the Minister to agree with me. It is a test of whether the employer has acted with rationality in the sense that he is outside the band of reasonable employers as can be put before the court. In that respect there is a double difficulty for the tribunals. This point is very relevant to the amendment. In the Court of Appeal judgment Lord Justice Dillon cited the judgment of Lord Justice Mustill (as the noble and learned Lord was then) in the case of Campion v Hamworthy Engineering in 1987. He said:
"Whether the decision of an industrial tribunal was "right" must be understood as meaning 'not so demonstrably wrong as to be beyond reason'".
He went on:
"The appeal from the Industrial Tribunal … only lies on grounds of law".
So we have already in the structure a decision which the appellate court has to make, the employment appeal tribunal and after it the Court of Appeal and perhaps your Lordships' Judicial Committee, as to whether or not the tribunal was not so demonstrably wrong as to be beyond reason.
Under this clause, in order to make that assessment they have to decide whether that decision of the tribunal was not so demonstrably wrong on the issue of whether a reasonable employer could have taken that action having regard to the purpose mentioned in paragraph (a).
It is within that context that one seeks to find some reasonable balance of the factors that go into the tribunal, and possibly appellate, decision. It is my contention in this amendment that that balance is not properly struck on any possible ground when it ends with the words,
"Having regard to the purpose mentioned in paragraph (a)".
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This is so, first, because those words appear to limit the tribunal and then the appellate court only to the purpose mentioned in paragraph (a). Indeed, against my better wishes, I think that is the stronger interpretation of the clause. Even if we should take paragraph (a) as a dominant or primary interest, it surely cannot be right.
A purpose has to be judged with relation to all the interests that go into the questions that divide or bring together particular people. Surely a tribunal and appellate court ought to be able to have regard to the contractual and other rights of the relevant employees. Surely the Court of Appeal or the tribunal should be allowed to say: "We had regard to the purpose of Grade A type"—which is the one where he furthers a change in his relationship, as we now still have to have it: for all its uncertainties, one can hear the Court of Appeal saying, "Yes, that's there". But there are also these other rights of the employees, or non-contractual interests of the employees, and we think we ought to look at those in deciding—because what are we now deciding?—whether the tribunal was demonstrably wrong in deciding that a reasonable employer could not possibly take that decision—just to give an example of a case.
If it is limited to the employer's own purpose under paragraph (a), it is scarcely credible that he can ever lose. I know that some people say that that is the Government's intention—that the employer should never lose. Indeed, they have great weaponry in this clause at all points. But it surely cannot be the case that the tribunal is directed first to ignore the Section 146 discrimination—noble Lords will remember that that is the basis of it—ignore the fact that workers have been done down by reason of their trade union membership; take account of the employer's purpose, but do consider whether a reasonable employer could have taken that action, but, in deciding that last point, have regard only to his purpose—the particular employer's purpose, because that is what it says—under paragraph (a). It is completely circular. There is a wall of defence which is wholly circular around the employer. Surely even at this late point the Government will allow the interests of employees at least to be taken account of when the Government come to consider the balance which is demanded of the court. I beg to move.
Viscount Ullswater: My Lords, in determining whether an action falls within the scope of Section 146, a tribunal must, as the clause is currently drafted, consider whether the action in question was such as a reasonable employer would take with regard to the stated strategic purpose.
The amendment would provide in addition that the tribunal should decide whether the action was such as a reasonable employer would take with regard to the contractual and other rights of the relevant employees, as I believe was explained by the noble Lord, Lord Wedderburn.
I am afraid that I cannot accept the amendment. It is at least unnecessary and could in practice undermine what we are seeking to achieve in this provision. I shall tell the noble Lord why.

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I believe it is unnecessary because the test that the tribunal will apply—the test of whether the action concerned was one that a reasonable employer might take having regard to the strategic purpose—takes account of all the circumstances that a reasonable employer could take into account. There is no need to spell out any of those. Tribunals are well used to that test and I am sure that they apply it all the time.
Additionally, I believe it is unacceptable because the situations with which our clause is designed to deal may relate precisely to an attempt to alter contractual rights.
It is therefore possible to undermine the purpose of the clause by the inclusion of that phrase. There is nothing in the clause that prevents an employee exercising his contractual rights under his contract of employment and bringing a case of breach of contract if appropriate. We believe that there is a sufficient test in the clause as drafted. The amendment seems designed to make that test even harder for the employer to pass. I believe that the amendment is unacceptable and I hope that the noble Lord will withdraw it.
Lord Wedderburn of Charlton: My Lords, I have not the slightest doubt that I shall beg leave to withdraw the amendment. As I suggested to the noble Viscount many hours ago, there is not much point in doing anything else with all of them. The idea that the amendment is unnecessary because an employer could consider the interests of the employees is the whole point of the amendment stood on its head. We suggest that somehow or other a court should be enabled to take account of the interests—not necessarily enforce them, but have regard to them. However, the noble Viscount says that it would undermine the Government's objectives. I understand that. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 7 not moved.]
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 8:
In the new clause, line 20, at end insert—
("( ) In subsection (4) ("previous action" means action taken within the twelve months preceding the action taken against the complainant.")
The noble Lord said: My Lords, this is a very small amendment but I expect that it will receive the same treatment as before; that is, it will be considered either unnecessary or undesirable or both. Noble Lords will recall that in Committee a question was raised by my noble friend Lord McCarthy as to just what was meant by "previous action" in subsection (4). In the course of that debate the small point arose of whether the previous action, which it will be remembered carries the employer through to victory if his purpose can rest upon it and it is satisfactory under paragraph (a), need be recent or a long time ago. I do not remember that the Minister suggested any cut-off point. However, on looking at the matter, we thought that it should have some reasonable cut-off point.
Surely, it cannot be right that, on given facts, a previous action could satisfy the demands on the employer if it took place 15 years ago. There is no rule in the Government's amendment to say that it should
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not do so. The facts might rarely occur. But would it be right if it happened 10 years ago? Does the noble Viscount believe that, in a case where workers are being penalised for what previously were thought to be their rights, an action five years ago is relevant? We thought that 12 months was as long as any reasonable employer (some employers will dislike this clause very much) ought not to put in evidence the subjective matter of his purpose.
Let us remember that that is what the evidence has to be about. It is a previous action but it speaks to purpose. After 12 months or, if the Government believe that it should be a little longer, after a reasonable period, memories wane. Sometimes people give evidence about what they did last week which turns out to be unlike what in fact happened. After 12 months or two years it is very difficult to speak of purpose, even in a situation such as that about which my noble friend Lord McCarthy spoke; namely, a change in various types of employment arrangements.
So in regard to "previous action" would it help to make for clarity, certainty and less uncertainty in litigation for a period to be put on previous action? It does not cure all the other uncertainties but it helps a little with people on the shop floor and the office floor who, for the most part, will be trying to work out this provision as a sensible arrangement. It will give them something to look at in terms of time. I beg to move.
Viscount Ullswater: My Lords, the amendment would provide that subsection (4), which provides that the purpose of a previous action can be deemed to be the purpose of a subsequent action, would only apply if the second action were taken within 12 months of the first. We believe that there is no need to impose an arbitrary cut-off point such as the one proposed. Businesses differ and circumstances differ. I believe that it would be presumptuous for this House to impose arbitrary limits on the relationship of cause and effect between one action and another such as this. Besides, we must not lose sight of the fact that any action brought under Section 146 where there is a disputed purpose will be subject to the "reasonable employer" test.
In his attempt to curry favour for his amendment, the noble Lord oversteps the mark. He suggests that the tribunal would not consider the evidence with that test of reasonableness or look at it as how a reasonable employer would behave. I believe, unlike the noble Lord, that tribunals are perfectly capable of dealing with these matters.
The tribunals will have access to the full facts of the case. They will be able to decide whether any course of action was such that a reasonable employer might take. I believe that it does not need this arbitrary cut-off point. The facts will speak for themselves. I hope therefore that the noble Lord will withdraw his amendment.
Lord Wedderburn of Charlton: My Lords, the tribunals will make what they can of that. They will be in much greater difficulty in not having guidance on the question of when previous actions reach a cut-off point. After all, people cannot bring an action under the sections when three months have passed. The

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employee loses his rights after three months. But the employer can go on adding to his evidence as to purpose from facts 15 or 20 years old.
I appreciate that the noble Viscount may think that that case is unusual. But it is part of the law that if a tribunal says, "We are not going to look at the previous action 20 years ago because we do not think it is relevant to the matter", the case would immediately go to appeal and the judgment would be upset. There is no question of tribunals having the right to put aside the clause as it is drafted. Ministers often believe that they can get away from bad drafting by saying that the tribunals will deal with it. The tribunals cannot deal with it. The clause is as drafted.
The noble Viscount said that it was presumptuous for this House to engage in debate on such small matters. I should have thought that it was presumptuous of a government that puts forward this kind of clause to make that point. However, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
9.15 p.m.
Lord McCarthy Lord McCarthy moved Amendment No. 9:
In the new clause, line 25, after ("work") insert ("but does not include a group of employees categorised or described primarily by reference to their membership or non-membership of an independent trade union")
The noble Lord said: My Lords, we have discovered a new rejection—"presumptuous". I have counted five rejections. We are nearing the touchstone of seven degrees of rejection. "Presumptuous" may apply to Amendment No. 9; I sincerely hope not.
It may be said that the amendment is untimely. It could be argued, and perhaps the noble Viscount will argue, that Amendment No. 9 should have been moved at the same time as Amendment No. 5. It has a similar intention to Amendment No. 5. However, I am glad that it was not moved at the same time because it escapes most of the objections trotted out by the noble Viscount to deal with the points made by my noble friend Lady Turner.
The main objection to Amendment No. 5 was that it dragged in the question of principal purpose. Once one allows tribunals to decide the principal purposes, they may conceivably decide against the employer and, of course, the Government do not want that. That is therefore ruled out. One cannot say that of Amendment No. 9.
Amendment No. 9 relates to subsection (5) of the new clause, which defines "class". It states,
"'class', in relation to an employer and his employees, means those employed at a particular place of work, those employees of a particular grade, category or description or those of a particular grade, category or description employed at a particular place of work".
Amendment No. 9 seeks to say that such a class,
"does not include a group of employees categorised or described primarily by reference to their membership or non-membership of an independent trade union".
It is not an amendment conceived in the air. One can readily think of an employer who wanted to introduce certain benefits and confine them to non-unionists. He may have tried to do that in relation to individual agreements and contracts but a few
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people remain in the union. He therefore offers them star status or five weeks' holiday if they leave the union—benefits which will be given to non-unionists. He may say that those in a specific part of the drawing office or on a specific construction site will receive the benefits.
The union or the individuals may say, "It is strange. He has done this several times and each time the group includes people in the membership of a specific trade union"—it may be a union that the employer does not like. They may go on to say, "It is funny that all these benefits are being offered to groups who happen coincidentally entirely to consist of non-unionists and are being denied to the groups which entirely consist of trade unionists in a specific union".
I know that if one leaves the clause as it is, there is little chance that the unions will succeed with a defence of this kind—the 5 per cent. is always worth more than the 95 per cent. Nevertheless, it is a defence which they may put forward. It is something which will give them the possibility of making progress and is nothing to do with "principal purpose". I believe therefore that the noble Viscount should accept the amendment. I beg to move.
Viscount Ullswater: My Lords, I will give the noble Lord, Lord McCarthy, another form of rejection. I believe this to be a wrecking amendment. That is another word that he can add to his list of rejections. To explain why we take that view, an employer may wish to alter his bargaining arrangements and, to achieve that effect, offer incentives to encourage employees to accept a new arrangement under which a certain trade union does not negotiate terms on their behalf. If he wishes to do that, in some circumstances he may well have to identify the group of employees in making the offer by reference to membership of that trade union. There is no reason why we should seek to prevent that. The employer should be free to make the offer and the employee should be free to decide whether or not to accept it.
I believe that we define perfectly adequately in the new clause what may constitute a class. The amendment introduces a new concept into that definition which will certainly undermine the purpose of the provision. Therefore, I ask the noble Lord to withdraw it.
Lord Wedderburn of Charlton: My Lords, I wish to ensure that I have correctly understood the Minister's defence. When an employer finds it necessary, much though he may not wish it, to discriminate against a class of trade union members he may do so. Quite clearly, when he does so it is a breach of Section 146. I hope that I do not misunderstand the Minister. When he does so his very act of discrimination against the class is also an act which furthers a change in relationship to that class at work and therefore by itself justifies the breach under Section 146. Is it correct to say that all that the employer ever has to do is discriminate in respect of a class of trade union members in changing something in and about the area of whatever the relationship is? That is enough because he defends himself by doing it; the act of contravention is the act of defence. Is that right?
Viscount Ullswater: My Lords, I do not believe that I used the words "discriminate against". The noble Lord is trying to put words into my mouth. What the new clause now seeks to do is further a change in his relationship. That is not discriminating against a person. What we are trying to do is to determine who may be a member of a class. We say that the wording of the Bill is drawn sufficiently widely to make certain that if the employer seeks to change his relationship with a group or class of employee he can do so. I was not talking about "discriminating against" but about seeking to further a change in his relationship.
Lord McCarthy: My Lords, we have to believe in something. I know that tomorrow the Official Report will record precisely what the noble Viscount said. But I should like to ask him again what he said. He said that he did not say "discriminate". What he was suggesting was that our amendment was not needed. Our amendment is not a wrecking amendment; it is a "blowing the gaff" or "out of the bag" amendment. I believe that we have had a "blowing the gaff" answer. I want to know the word used because I have got only the intention. I believe the Minister said that if the employer's purpose was to get rid of members of a particular union—one might not call that discrimination but in some way it would be a move against members of a particular trade union—he was perfectly entitled to classify them as a class. Because he classified them as a class he would be perfectly entitled to say that he wanted to change his relationship with that class. Once he did that he would come under (3) (a) and (3) (b) could not touch him. In effect, was that not what the Minister said? If not, what did he say?
Viscount Ullswater: My Lords, again with the leave of the House, the words that I used are these. An employer may, as we have said, wish to alter his bargaining arrangements. He may, to help achieve that effect, offer incentives to encourage employees to accept a new arrangement where a certain trade union does not negotiate terms on their behalf. If he wishes to do this he may well, in some circumstances, have to identify that group of employees. That is what we are saying. He may have to identify in order to make certain that the tribunal knows that he is seeking to do it to a class.
Lord Wedderburn of Charlton: My Lords, before the Minister finally resumes his seat, I should like to associate myself with the words that he has just used. Of course he did not say the word "discriminate". But what he has just said on the last amendment on Report shows how useful Report and Committee really are. On the last amendment on Report, we come to it. We agree that where the employer wishes to give incentives to employees, which would obviously further a change in relationships, he may well wish to identify among them a class by reference to their membership of a trade union—a given trade union—and not apply those offers to them. I used the word "discriminate" but it does not really matter. That fact complex is, at the moment as the law stands, a breach of Section 146. And not only because the Court of Appeal said so; indeed, it is way behind the Court of
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Appeal. But after the Court of Appeal it is absolutely clear. If that is so then when the Act comes into force with the clause, as it obviously will, the employer, by doing precisely what the Minister has described, would commit an action which, as the law stands now and then, would be a breach of Section 146. That is clear. But he would also by the same action commit himself to a purpose which would change the relationships among the employees as to the incentives and with primary reference to that class. The very same action is therefore a contravention of Section 146 and a defence under the clause as it would stand with the amendments. Therefore, what we have been debating, it now turns out, is very easily cured by any employer who wishes to discriminate against trade union members.
Viscount Ullswater: My Lords, again with the leave of the House, I feel that this is a rather important point. I do not believe that what the noble Lord has said is in any way how I sought to answer the noble Lord, Lord McCarthy. What he is doing is trying to put words into my mouth in identifying what I was suggesting was to define a class by a particular trade union —nothing to do with trade union membership or not. The noble Lord, Lord McCarthy, may laugh but what he is seeking to do is to put words into my mouth which I did not use. I should like to go on the record that what I was trying to do was to define a class and the words that I used I chose carefully. It was certainly not to discriminate against a trade unionist, either individually or in that connection collectively.
Lord Wedderburn of Charlton: My Lords, a personal explanation is allowed. I did not wish to, and I did not, put words into the Minister's mouth. What I was doing was taking his fact situation and applying it to the clause, which he has not done.
Lord McCarthy: My Lords, I think that we should end now because the noble Viscount has gone so far under the water that if he stops there any longer he will bob up. I do not particularly want him to bob up. He is quite a long way down. I hope that the Trade Union Congress and our colleagues in another place will read with great care what the noble Viscount has said tonight because I think that he has given the game away. This was the blowing the gaff, out of the bag amendment. I was very pleased that we moved it and now I beg leave to withdraw it.
Amendment, by leave, withdrawn.
9.30 p.m.
Baroness Turner of Camden Baroness Turner of Camden moved Amendment No. 10:
Leave out Clause (Action short of dismissal: non-infringing actions)
The noble Baroness said: My Lords, I cannot let this clause leave the House on Report without making some comments for the record, which I do in support of Amendment No. 10. First, I should like to say a word or two about the procedures followed. I say to the noble Viscount that I understand that these were agreed through the usual channels. I am not complaining about that. But it is clear that many noble Lords are very dissatisfied with the way in which

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this particular clause has been tackled. They feel, with some justification, that inadequate time has been provided. Clearly this is an important issue, but there has been little time for consultation with bodies outside this House and also for your Lordships, who have a particular interest in this subject, to study what the amendment is about.
The Court of Appeal decision has become available only very recently and as the noble Lord, Lord Campbell of Alloway, said earlier this afternoon, he and others have had very little time in which to study the important issues involved. Moreover, those of your Lordships who have put down amendments in the normal way for debate at Third Reading of this Bill are having to have that Third Reading put back to a time which is quite impossible. I am complaining, first, about the procedures which have been followed, bearing in mind and accepting fully that our Front Bench has some responsibility because the matter was discussed through the normal channels. However, it has turned out not to have been a very satisfactory procedure.
Secondly, I question the need for haste in this matter. As we have said repeatedly from this side of the House, the legislation in question has been in existence since 1975. Cases have been going through the courts which were decided very much in the terms of the recent Court of Appeal case. It seems to me that the Government decided that they did not like the Court of Appeal decision, but they did like the EAT decision. Therefore, at this very late stage of this important Bill we have an attempt to write into the legislation support for the EAT decision as against the Court of Appeal decision and the precedents on which its decision was based.
There has been the failure of the Government throughout the debate at both Committee and Report stages to accept even minor amendments submitted on this side of the House which were intended to make the purpose of the new legislation clearer. We have tried the kind of amendment to comply with what the Government have said; that they do not intend there to be discrimination against trade union membership. We have tried to clarify what that will mean in practice. We have had very unsatisfactory responses from the Government.
So we are left with an extraordinarily abstruse piece of wording in this legislation with which industrial tribunals and EATs will find great difficulty when they come to interpret it. Furthermore, as a number of noble Lords have already said, this legislation cuts deeply into the heart of Section 146 of the 1992 Act. That section of legislation was intended, and does, comply with the international obligations which the UK Government have accepted for generations. There is no indication—apart from the Minister's statement that there has been some internal legal advice—that there has been independent legal advice sought as to whether or not this clause breaches either ILO conventions, international obligations or the sections of the Treaty of Rome quoted by the noble Earl, Lord Russell.
Furthermore, this is another part of the Bill which
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tilts the balance decisively against employees and in favour of employers. It does so in a most blatant and obvious way. It legitimises actions by employers for the future which will enable them to discriminate against trade union members. The Minister says that there is no intention to discriminate against trade union members; that the aim is simply to ensure that an employer can alter his industrial relations arrangements and make different arrangements with his employees. But the amendments which we proposed, and which would have meant that the employer would have had to negotiate changes in the arrangements, have been rejected by the Government. They say that employers should not have to do that. They should be able to make such changes by diktat without consulting anybody, certainly not their employees. That is totally unacceptable.
For those reasons I very much regret that we have been unable, either at Committee or Report stages, to make any impact whatever on the Government's thinking with the amendments which have been so ably argued this evening by my two noble friends Lord McCarthy and Lord Wedderburn. I very much regret that the Bill leaves this Report stage with the clause in it. I beg to move.
Lord Mottistone: My Lords, before my noble friend speaks I should like to say two things in answer to the noble Baroness. First, the amendment—I said this earlier—does no more than restate the employer's right to seek to order his relations with his staff in the way considered most appropriate for the organisation concerned. Secondly, I congratulate my noble friend on resisting the arguments, put skilfully as always by the noble Lords, Lord Wedderburn and Lord McCarthy, and the noble Baroness, Lady Turner, which were designed to exploit the amendment to the best advantage that they possibly could and to persuade him to say something he might later regret. I am happy to say that, having listened carefully to the debate, I am pretty certain that my noble friend did not put one foot wrong. He must be congratulated by all your Lordships, including those who strove to trip him up.
Viscount Ullswater: My Lords, we have now debated further amendments tabled by noble Lords opposite on Report. I have been unable to accept any of them, but they have offered the opportunity for further debate, and I hope and believe that the debate has provided an opportunity for me to explain further the intentions of the legislation and to offer reassurances as to the application of the new clause. I am grateful to my noble friend, not just for his words of support but for the support that he has given to the new clause. He and I understand the purpose of the clause. I understand also the reasons why noble Lords opposite seek to oppose it.
We believe that the new clause will play an important part in clarifying the conduct of industrial relations. Individual trade union members will continue to be protected in law. Employers will not be unreasonably restricted in conducting their business. I therefore commend the clause to the House and resist Amendment No. 10.
Baroness Turner of Camden: My Lords, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
9.38 p.m.
Clause 13 [Right not to be excluded or expelled]:
Lord McCarthy Lord McCarthy moved Amendment No. 1:
Page 24, line 9, at end insert ("and the union has indicated that it is not able, or is no longer able, to act on his behalf.").
The noble Lord said: My Lords, we now return to the Bill as it left the House the last time we dealt with it. We deal with Clause 13, and we return to the notorious Bridlington clause. The amendment adds to the number of justified exclusions and expulsions on the face of the Bill, so that if a union has indicated that it is unable, or no longer able, to act on behalf of a member or a would-be member, that would, in effect, be a justified exclusion or expulsion. That would mean that unions could put a lawful rule into their rule book giving them the right to operate an enforceable membership requirement with some justification if they could show, as it were, that they were unable, or no longer able, to act on behalf of a member or a group of members or would-be members. It will be said, and we see no reason to deny it, that that would cover many of the so-called Bridlington decisions, although it would not necessarily cover them all.
The Government have rejected all our amendments designed to assist the continued operation of the dispute principles of the TUC. We do not therefore expect anything new from them tonight. The only new aspect is likely to be a different form of rejection which the Minister will find. He appears to be finding new forms of rejection at this stage of the Bill.
We have tabled the amendment because we wish to return to the Bridlington issue and also because at this stage we wish to point out that what the Government intend to do in Clause 13 is far wider than anything related to the Bridlington Rules, which relate largely to exclusions. In practice the Bridlington Rules are largely operated when unions go to the TUC because one union says that its members have been poached and recruited by another union. In effect, it is trying to get the union to agree that such recruitment is contrary to the Bridlington Rules.
The provisions in Clause 13 go much wider. The clause relates not only to exclusions but to entry and admissions. For the first time the Government are regulating in a narrow and precise way who should be allowed to join trade unions, the type of people who should be allowed to join which trade unions and the circumstances under which trade unions are allowed to say that they do not wish to recruit particular members of the workforce. During our debates we have said repeatedly that that is in sharp contrast with the way in which the Government rightly continue to allow voluntary associations and powerful, professional associations—for instance, veterinary surgeons, chartered surveyors, the Inns of Court, political parties, which may or may not operate quasi closed-shop practices, masonic lodges, the Institute of
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Directors and so forth—not to have their entry qualifications regulated in the way that trade unions are having theirs regulated.
That is the central thrust of much of the Bill about which we are protesting as it applies to Clause 13. I shall argue subsequently that seven degrees of uniqueness are applied to trade unions under the Bill. There are seven ways in which trade unions are said to be unique; seven ways in which their rights and privileges must be undermined, altered and narrowed. One of the central and in some ways most fundamental of those restrictions lies on entry. That is undoubtedly contrary to ILO conventions and to all kinds of international standards. So far as I am aware, nothing remotely of the kind exists in any western country with developed trade unions. The Government are taking this action without any real justification except a general appeal to the uniqueness of British trade unions.
Even at this late stage will the Minister tell the House what it is about British trade unions that requires entry to them to be regulated by statute in this way? It will be no good telling us yet again, "Oh, they are different. They are not the same as masonic lodges, institutes, professional associations or clubs. They are different". The issue in dispute is why their difference, such as it is, means that it can be dealt with only by the Government regulating and restricting their autonomy in this way. I beg to move.
9.45 p.m.
Viscount Ullswater: My Lords, I have to say that I was rather mystified by this amendment because its effect is to place an additional and unnecessary hurdle in the way of a union which wishes to legitimately exclude an individual from membership.
Clause 13 gives individuals the right to join the union of their choice, with certain sensible exceptions. The amendment would have the effect that when relying on one of those legitimate exemptions in order to exclude an individual from membership—namely, that the union need not accept as members those who have no trade, occupation, or qualification in common with their membership—the union would in addition have to show that it had indicated to that member that it was not able to act on his behalf. Why put this extra legal barrier in the union's way? The provision protects unions from having to accept inappropriate individuals into membership. There is no reason in the context of the clause why the union should additionally have a statutory duty to indicate that it is unable to act on behalf of the individual, whatever that may be taken to mean.
However, I believe that the noble Lord indicated that the wording of the amendment was intended to stand alone, as an additional legitimate reason for exclusion under new Section 174. If that was to be the case, then noble Lords must realise that it would completely undermine the clause and would therefore be wholly unacceptable to the Government. Whatever its intention, such an amendment would have the effect that a union could exclude individuals on virtually any ground it chose, as long as it first said that it did not consider itself able to act for them.

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Unions could, for example, act on arrangements such as the Bridlington principles with impunity. Union members' wishes could once again count for little or nothing. We cannot accept that.
The noble Lord asked me why it should not be for unions to decide what they have in their rules and why should the Government interfere. Union rules are certainly a matter for the unions themselves. However, those rules must not have the effect of threatening the legitimate freedoms and rights of trade union members. We have seen how the Bridlington principles take no account of the wishes of individuals, but simply bolster existing spheres of influence and avoid legitimate competition. And we have seen how individuals may be denied membership of a trade union which they may have every good reason for wishing to join because of such rules. The provision will ensure people are not prevented from joining the union of their choice except on reasonable grounds.
As I have said, we have already made provision for the legitimate reasons for which a union may wish to exclude an individual. This amendment adds nothing that is useful or relevant to the purposes of the clause, and I hope that the noble Lord will withdraw it.
Lord McCarthy: My Lords, the noble Viscount has not given me any answers. The Minister is quite right. We saw the amendment as adding to Section 174(2) (a) so that in future a union would have a perfectly lawful rule that it could exclude or not recruit individuals if it had indicated that it was unable, or was no longer able to act on their behalf. However, if the noble Viscount wished to smile on the amendment and wanted to say that it would be more effective if it stood on its own, that could be achieved even at this late stage. Therefore, the drafting of the amendment is not the critical issue.
The critical issue is that the noble Viscount does not like the amendment. We know that he does not like it. However, he has not given us any reasons. He has given the same general statements about unions being different from other organisations. We are still not told first, what that difference is and secondly, why that difference is of such a kind that it justifies the imposition of limitations on unions.
I can think of two reasons. The Minister could be saying that unions are so corrupt and so appalling in their internal administration that they must be regulated in that way. But he does not say that. If he did, we should ask him about the institutions which the Government have established to look into such matters which have no work to do. We should ask him about the CROTUM, if unions are so corrupt.
The Minister could be saying that not only are the unions corrupt, although he has no evidence with him this evening, but that they are also so dreadfully powerful that the state must pronounce upon their entry requirements. He does not say that. Indeed, in another place at other times government Ministers are always telling us how they have squashed trade unions and reduced them to size. Therefore, the Minister cannot say that they are corrupt; he does not say that.
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He cannot say that they are all-powerful; he does not say that. However, he continues to stick to his arguments. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 17 [Notice of ballot and sample voting paper for employers]:
Lord Wedderburn of Charlton Lord Wedderburn of Charlton: moved Amendment No. 2:
Page 31, line 9, leave out ("falls") and insert ("and section 231A fall").
The noble Lord said: My Lords, in moving the amendment I shall speak also to Amendment No. 3 and to the last amendment on the list, Amendment No. 28—the end is in sight. I do not do so because of the kind of reasons put forward by my noble friend Lord McCarthy, although they are connected with the matter. I support him totally, but I was not able to agree with the form of the last amendment. The Minister must take account of the fact that it seems to us that we are up against an immovable "no", whereas we vary a little in the matters that we put before him. We are not just a block; we are a set of splinters each of which is very sensitive to the argument.
I turn now to Amendments Nos. 2 and 3 which deal with a technical argument. I genuinely seek to have the Bill in some sensible form, not against but within the Government's policies; at least, I hope that my arguments will be understood as falling generally within them. Their policy is that all industrial action requires the support of a ballot which must now be a postal ballot. However, certain requirements will differ according to who appears in the court room to complain. In other words, the situation that noble Lords should posit is that of a complainant—or plaintiff in the High Court—and a union defendant or respondent where the union is saying that the action was supported by a ballot.
There is a whole series of requirements which I shall call the "ordinary requirements" for the ballot; that is, there must be a ballot taken of those entitled to vote, it must be conducted in secret, and so on. It would weary noble Lords if I were to read out those requirements. But I suggest that the ordinary requirements are very clearly found. The best place to find them is in paragraph 47 of Schedule 8 where they are set out in relation to a member of the union who, since 1988, has been able to bring an action whereby he complains that the industrial action to be called by the union does not have the support of a ballot. Therefore, the member, as the complainant, requires the ordinary hurdles to be surmounted.
However, if we go to the other end of the spectrum as set out in the Bill, there is now a superior set of hurdles that must be surmounted by the union as regards the employer. I cite the words contained in Clauses 17 and 20 in respect of Sections 226A and 234A of the 1992 Act, to found my argument on a clear source in the Bill. Those are the clauses and sections which require the need for the union to prove and show, as regards the employer—that is, the employer of anyone who is an employee who may be "induced to take part" in the industrial action—what I tend to call the "extra requirements". I make no point against them in that respect. First, there is the

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requirement that notice must be given to the employer at least seven days before stating that there is to be a ballot. Secondly, the employer must be shown at least three days before a specimen ballot paper. Thirdly, within a reasonable time the union must notify the employer of the result of the ballot. Finally, not less than seven days before the action, a notice must be given to the employer concerning who is to take part, and so on. Those are the four extra hurdles. They appear to make the position difficult, but where the union is in court and it can mention the ordinary requirements, it will not succeed against the employer unless it can prove that it has surmounted the four extra hurdles; that is, the notice, the specimen ballot paper and the other hurdles.
In the past I have suggested that this was rather absurd. I have consulted with a number of people who have been more directly in the firing line on this matter in the past few days than was the case previously. In the past 10 days a number of solicitors have contacted me. They were mostly solicitors who advise trade unions. They have said this is an absurd procedure and that they will always advise unions to go through the four extra hurdles as they do not know who the plaintiff will be. They have no idea whether the plaintiff will be the employer in the High Court or the member bringing a right of action under Section 62.
In the past I have said that this division of requirements according to who pops up as plaintiff is rather a crazy way of doing things. The Government might just as well have said, "These are the requirements and you must observe them no matter who the plaintiff is". When I raised this matter before, the noble Viscount kindly wrote to me and confirmed that my understanding so far was correct. He suggested that that was what the Government wanted. In the short debate we had on this matter, the issue was left there. Therefore I must leave it there. I am not trying to reopen that debate. This is a somewhat technical matter and I apologise to your Lordships if I have taken a long time to explain it. However, I have avoided referring to some of my footnotes.
Previously a point has arisen—it arises now also —as to the third party plaintiff; that is to say, the plaintiff who is not the employer party in the dispute and is not a member of the union but who says, "You did not properly have the support of a ballot as far as I am concerned and therefore I can bring an action on the basis of an arguable tort". An action in tort in the High Court will lie. One would have thought that the union could then say, "Oh, but we have satisfied the ordinary hurdles. You are not the employer". I quite see that the purpose of the Bill is to give the employer extra rights. However, the union could say, "You are not the employer. We have held a ballot. All the people voting were entitled to vote and it was a secret ballot". The union could say, "We do not have to prove to you that we have given these notices to the employer because that is a requirement of the employer". That provision is stated quite clearly in Sections 226A and 234A of the Act.
So far, the union would be correct. However, if one looks at the sections I have referred to in Amendments Nos. 2 and 3, and if one looks in particular at Schedule
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8 on page 114 of the Bill, one will see that there is one section which requires the support of a ballot which is not contained in the ordinary requirements. Up to now, one would have thought of that as falling only within the requirements as respects the employer. That provision falls within Section 231A.
Section 231A requires the union to notify the employer, or perhaps more accurately, the employers —this applies to any employer whose employees are to be induced in the action —of the result of the ballot. I do not suppose trade unions would have any particular objection to doing that. At the point of the ballot the difficulties are not at their most extreme. However, this is a requirement that could easily trip up the unions.
If there are to be dual requirements according to plaintiff, I urge the Government to reconsider this matter, even at this late stage and on the basis of this technicality which is the technical apparatus they have insisted upon; that is, a division of requirements between those of employers and those of others. The third party plaintiff may be a supplier. There are many examples in law reports of third party plaintiffs who may be customers or suppliers. It is not quite "Disgusted of Tunbridge Wells" but DOT may have a contractual right which has been infringed by the action. The union will say, "We have had a ballot" but DOT will say, "No you have not, because you have not satisfied Section 231A and told the employers—not DOT—what the result of the ballot was". That is a highly technical point which ought not to remain in the Bill in its present form.
I have genuinely tried to follow the debate so far and the Government's own intention. In moving the amendments I suggest that if there are to be two categories—employer and the rest—let there be two categories. However, surely there should not be a third category for which the ordinary requirements are, quite illogically, joined by the requirement to give the result of a ballot to an employer who is not even the plaintiff who appears in court.
I hope that the Government are at least able to consider the amendment at this late stage. If not, it will all come out in litigation. I beg to move.
10 p.m.
Viscount Ullswater: My Lords, I am grateful to the noble Lord for explaining the background to Amendments Nos. 2, 3 and 28. I recognise that they touch on themes similar to those considered in connection with Amendment No. 19, which the noble Lord moved at Report stage.
I perceive, however, that the intended changes to the provisions of Section 226 of the 1992 Act are both more precise than, and somewhat different from, those which were proposed by the noble Lord at Report stage. In summary, they would mean that if a union failed to satisfy the requirements of the new Section 231A—that is to say, it did not take steps to supply an employer with details of the ballot result—it would lose the protection of the statutory immunities only in respect of proceedings brought by the particular employer denied those details.

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The requirements of the new Section 231A will not mean that a union must necessarily tell a particular employer the result of votes cast by that employer's particular employees. That would be the case if the ballot was a ballot of a single employer's workers but not if it was a multi-employer ballot. There is, of course, only one ballot result in either case. Moreover, to satisfy the requirements of Section 231A, the union needs to do no more than provide the same details of the ballot result to all employers whose workers took part in the ballot as it is already required to supply to its own members.
I can confirm that the provisions in the Bill will mean that, if any employer whose workers are given entitlement to vote in an industrial action ballot is denied the ballot result details which are to be provided to such employers under Section 231A, the ballot as a whole will not be capable of affording protection to the union against proceedings in tort. Therefore, any employer could bring proceedings against the union on the basis that the union had failed to provide the ballot result details to another employer.
I would accept that such proceedings would be rather unlikely. However, it is appropriate to apply the new ballot result detail requirements in this way, for reasons which I shall explain.
The ballot result details—in sharp contrast with the proposed new requirements for the provision of certain notices to employers—relate to the industrial action ballot as a whole. Such a ballot might well involve employees of more than one employer. So would the details which will, in future, have to be supplied to each employer.
I should add that when—by virtue of this Bill—industrial action ballots have to be conducted by fully postal voting it would not really be practicable for an employer to be informed of the result of the ballot among his own particular employees where they had voted as part of a multi-employer ballot.
Moreover, the current provisions of Section 231 of the 1992 Act apply in exactly the same way. Those provisions have been part of the law since 1984. They mean that, to obtain the protection of the law for its call for industrial action, a union must take steps to supply ballot result details to its members.
It is open to an employer to bring proceedings against the unlawful organisation of industrial action because a union has failed to carry out the steps which the present law requires in respect of the provision of ballot result details to members. It is not relevant, for these purposes, whether the members denied those details are employed by that particular employer.
We believe that it is right to adopt the same approach with the new requirements to notify ballot result details to employers.
I appreciate that the noble Lord is concerned to determine who can bring which particular proceedings, and on what particular grounds. There is, of course, a simple enough answer to any union which wants to know what it must do to avoid risk of such
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challenges. The answer is that it must comply with all the requirements of the law, and that if it does so it will not be at risk of a court order against it.
To spell this out, a union will need to provide all relevant employers with the notice required to satisfy the requirements of new Section 226A of the 1992 Act. Following the ballot, it will also have to take steps to provide relevant employers with details of the ballot result. As a matter of practice, of course, satisfaction of the second of these two elements will mean providing the very same ballot result details as the union would already provide to its own members.
It is quite correct that a union's failure to take the steps to provide either notice or ballot result details to an employer could provide the grounds for proceedings under the new citizen's right. However, that is quite justifiable. Considered from the perspective of the individual bringing such proceedings, what has happened in such a case? A union is organising industrial action which would deprive the individual of goods or services. The union's call for action is, however, actionable in tort because it does not satisfy the requirements to afford it the protection of the immunity. Therefore the union is acting unlawfully and the individual's deprivation stems from that act. In such circumstances it would be quite wrong to deny the individual the protection which the citizen's right is designed to secure.
The noble Lord seems to continue to view matters from a slightly mistaken perspective. He asks: what will a union have to do in order to protect itself from proceedings which might otherwise be brought by anybody? That may be a proper question from someone advising a union. However, it is not the right basis on which to construct an appropriate system of law. For that purpose it is right for the Government to ask themselves, as we have done, who should be able to bring proceedings for a failure to comply with a specific requirement? That is important because it will remain up to individuals to decide whether or not they wish to make use of the law to protect their interests as they see them in any given situation.
I understand the noble Lord's anxiety. However, I seek to allay his fears. I hope that he will withdraw the amendment.
Lord Wedderburn of Charlton: My Lords, I understand what the Minister says. Indeed, he would not put words in my mouth. But I did not address the issue of whether the employer would know the result of his own employee's vote. Nor did I address the issue of what he calls the citizen's remedy under Clause 21. I was concerned only with Clauses 17 to 20.
I predicted the Minister might say that there was a simple enough answer; that the trade unions need not worry about all the different hurdles because they must comply with the law. I know that the Minister will not apply what I say to himself personally. It applies to the Bill. When one states that one must comply with the law, and the law does not apply equally to equal cases or set out duties and liabilities clearly, if at all, there is a usurpation of the normal rule of law, accepting the different ways in which people use that phrase.

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I believe that the Government are saying, as practitioners such as trade union advisers, employers' advisers and many people interested in the legislation will say, that a union which holds a ballot, organising industrial action, must go through all the hurdles including the big four—notice to the employer; declaration of results, and so on. The noble Viscount nods his head. But one should not do that in a Bill which pretends, as it does, that the big four hurdles apply only to employers. Clause 17(1) (b) refers to,
"Where section 226A falls to be complied with in relation to the person's employer … by the employer … unless the trade union has complied with Section 226A".
That is the beginning of the notices. What is the point of the phrase "by the employer"? It is the drafting of the Mad Hatter. We all know that the provision applies to the union, no matter with whom it is concerned. If the four hurdles—the notices, the ballot paper, the declaration of result and so on—are not overcome, the union will lose.
This is the last time that we shall make the point. The Minister sometimes says to us, "You should have considered this from the point of view of advising the trade unions". I say to him that the Government should sometimes consider the Bill with a view to trade unions perhaps winning a case now and again, instead of the Government always drafting the legislation so that they cannot. One does not draft a Bill such as we have agreed this is, where a union must go through all four extra hurdles, and saying, first, that it does not apply to the members. The logic of the Bill is not the logic of the Minister. These four extra hurdles do not apply where a member of a trade union brings an action. Why not? The Minister has just said that it is absolutely vital. But if a member brings an action and the union can show that it has satisfied the ordinary hurdles, it does not have to show any notice to the employers, as I read the Bill. I hope that the Minister will correct me immediately if that is wrong, because people outside are scratching their heads.
When an employer turns up, the union has to satisfy all four hurdles. When a third party turns up —not another employer in the dispute but some other person, whether or not an employer—he can show an action if the union does not show that it has declared the result of a ballot to an employer to whom it has given no notice. It can fail to give notice but if the third party plaintiff turns up it still has a defence.
It is a quite absurd state of law-making. I feel rather sorry for the third party plaintiff. Why should he not have the advantage of what the union will have to do when it gives notice to the employer? The Bill has been changed as it progressed. Had this been another occasion I should wish to go through the various stages because the Bill has not been the same all along. What is now Schedule 8 was Schedule 7, but it used to he rather different. The Government have now left themselves, through insufficient time and consultation, with a Bill which is dilapidated law. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 3 not moved.]
Viscount Ullswater Viscount Ullswater moved Amendment No. 4:
Page 31, line 32, after ("describing (") insert ("by name or in any other manner").
The noble Viscount said: My Lords, I am speaking to Amendments Nos. 4 and 6. I believe the amendments may commend themselves to your Lordships as a means of putting it beyond doubt that a union may be able to satisfy the new notice requirements otherwise than by providing individual names to describe relevant employees. Indeed, the Government believe that the circumstances in which a union will only be able to satisfy the requirement by providing names will arise very infrequently—if ever.
The Government have never, of course, sought to argue that there was really any scope for such doubt, even without these changes. In explaining why we now propose them, I must, therefore, refer to certain amendments tabled by the noble Baroness, Lady Turner.
These government amendments have been prompted by Amendments Nos. 5 and 7 proposed by the noble Baroness. As I understand them, her amendments must be seeking to do exactly the same thing as would be achieved by the Government's. They acknowledge on the face of the Bill for the first time that the provision of individual names is one means of satisfying the notice requirements.
The Government's amendments would have exactly the same practical result as those tabled by the Opposition. Why then, do we prefer them? Frankly, the reason is our desire to act in accordance with the principles of good practice in drafting legislation.
It is clear enough that the government amendments are more concise than those of the Opposition. Our amendments do not involve adding any new subsections, and require fewer words. We must also aim to minimise the risk of confusion about the intended effects of the law. The government amendments, therefore, avoid the importation of the imprecise, undefined, concept of "as a matter of course". It is clear enough that, as the Opposition amendments stand, no one would really be any the wiser about the particular circumstances in which it would, or would not, be necessary for notice to be given in a form that included individual names.
As I have said at all the stages when your Lordships have considered the detail of the content of the proposed new notices to employers, we believe that employers should be entitled to know which of their workers are likely to be involved in either a ballot on industrial action, or in official industrial action.
In responding to Amendment No. 20 at Report stage I explained exactly why we believe employers should have that right. My remarks are recorded at col. 89 of Hansard for 26th April. Later, in the debate on Amendment No. 21, I pointed out that a situation where industrial action is in prospect creates very special circumstances. In such a situation the union will be seeking the special protection which the law may provide if it calls for industrial action. The point is that it is the union's choice whether to embark on the organisation of action. When it makes that choice and decides to seek the special protection of the law, it may well have to do things which it would not otherwise wish to do.
Since the union will be proposing to do something which is directly aimed at the relationship which exists between its members and their employer, it cannot be wrong to ignore the employer's rights. Those rights, it seems to us, must include the right to be able to know which employees may be voting in an industrial action ballot or are called on to take industrial action. If the Opposition amendments are to be taken as evidence that they now accept that it is right for the employers to know those details, that is very welcome.
The new notice requirements are both practicable and reasonable. They do not require a union to do more than it can do by way of telling an employer about its intentions. But they will provide important early warning to employers and help ensure that businesses and the public can be better protected against the effects of precipitate industrial action. These amendments are evidence of our willingness to respond to ideas for changes to the legislation which are compatible with its basic objectives. Since our understanding of the intended effects of the noble Baroness's amendment is that they would fall into that category, I am happy to offer these government amendments as a means of achieving the same result in a better way. I beg to move.
10.15 p.m.
Baroness Turner of Camden: My Lords, during discussion of this Bill in Committee, and again on Report, we have expressed our deep concern that the Bill as currently drafted could involve a union in having to identify its members to an employer twice —once when seeking to ballot members and again when seeking to put into operation a majority decision to have a dispute when members would be balloted.
We have sought to meet the Government's case in our amendments on previous occasions by suggesting that categories of employees should be indicated. We have also suggested that numbers could be indicated. But on neither of those occasions were the Government prepared to accept our amendments.
I endeavoured at Report stage to protect confidentiality by proposing that the union should not be expected to give the employer names of members held in confidence. It is surely obvious that every union has in membership people who would prefer that their employer did not know that they are union members. For that reason, not all union members pay subscriptions by check-off, even when there is such an agreement with the company. Sometimes they are people who are in line for promotion. While they may wish to continue membership of the union, they may feel—possibly wrongly —that their chances of promotion could be diminished if their union commitment were known. It is a fact of industrial and commercial life that quite subtle forms of discrimination, which are hard to identify, sometimes take place. Moreover, if the names of individuals are known in advance of disputes the possibilities of intimidation are obvious.
During our debates on this question, and again tonight, the Minister has said that it would not normally be necessary to provide names, but only in
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the most exceptional circumstances. Therefore we put down amendments this evening in a last attempt to try to ensure that an employer in a potential dispute situation could not assume that he had a right to be provided with names.
The Minister says that the amendments he proposes, Amendments Nos. 4 and 6, are attempts to meet the objections to which we have previously given voice. Unfortunately, from our standpoint, they fail to do so. What bothers us particularly is that they refer to,
"by name or in any other manner".
Noble Lords will note that "name" appears first. In other words, the employer would have every reason for assuming that,
"by name or in any other manner",
meant "by name".
I credit the Minister with an attempt to meet the points we have made. We have made them very strongly. They were made not only on this side of the House. Noble Lords on the other side have also been disturbed about the implications of the Bill unless amended. I am sure that the Government intended to make improvements in the direction that we sought. Unfortunately, they have failed to do so. In my view, the wording that they suggest is rather worse than what appears in the Bill unamended. To have inserted in the Bill "by name", as the first requirement, so to speak, will encourage employers to believe that as a matter of course they are entitled to be advised by name of the people who will be balloted and who later may be called out in dispute.
I appreciate the views put by the Minister in regard to our amendment. I would not claim that the wording is marvellous but we did try to meet the objections to previous amendments voiced by the Minister. We felt that we had devised a formulation which would mean that the employer did not assume as a matter of course or right that he was entitled to have names. With respect, I do not believe that the alternative wording suggested by the Minster in any way meets our objections. It is with great regret that we are unable to accept it.
Lord Rochester: My Lords, on these Benches we have maintained throughout the Bill's passage that the requirement that unions could be forced to give employers the names and addresses of members amounted to unreasonable breach of confidentiality. In Committee and on Report various unsuccessful attempts were made to find a formula acceptable to both the noble Viscount and noble Lords on this side of the House.
I suppose that we must acknowledge that the amendments in this grouping mark the end of this particular road. Like the noble Baroness, Lady Turner, I accept that in moving the amendment the noble Viscount has done what he can to meet our concern. I am only sorry that, as the noble Baroness said, he has not quite done so.
The noble Baroness acknowledged that she found some difficulty in framing her Amendments Nos. 5 and 7. But they are perhaps to be preferred to the amendments proposed by the noble Viscount, Lord Ullswater.
Lord Wedderburn of Charlton: My Lords, I support my noble friend very strongly on this matter. I wish to say to the Minister that this point was widely discussed by those interested in the matter outside this House. It is a general opinion among lawyers that the amendment would confine the trade union and detract from the rights of employees rather than the opposite. It is too late to make the case again that this is an infringement of human rights, though I still believe it to be such. However, the manner in which this legislation has gone through also suggests that it is, as it were, claiming back territory that was given away in another place.
After all, in Clause 17 in its original form the union was required to state the identity of the relevant members. That was taken out of the Bill and it was then not very clear just what the union should do. In both the relevant clauses it should describe them so that the employer could ascertain them. There was not much elbow room there, one might think, but there was some.
Now, however, to insert the phrase that the union must describe its members—"finger them", as I once said in this House—
"by name or in any other manner"
clearly makes the requirement that name is the primary solution and the standard and that "in any other manner" on normal principles of interpretation must match up to naming the members involved. It is therefore a step back to what used to appear in Clause 17. I think it extremely unfortunate. It is not simply a technical matter. The noble Viscount may feel that it should make some small improvement. In fact it takes a colossal retrograde step from what was in the first draft of the Bill.
Lord McCarthy: My Lords, I merely wish to say to the noble Viscount that if he has really done it for us, perhaps for our sake he will take the amendment away and lose it.
Viscount Ullswater: My Lords, I am sorry that I do not have the support of my noble friend Lord Campbell of Alloway. When he spoke to me earlier today he said that he would have liked to support the amendment as he saw it as a genuine attempt by the Government to go down the road that we have discussed both in Committee and on Report. The noble Lord has his birthday today and I can understand why he may not be in his place.
Amendments Nos. 4 and 6 do no more than replicate, with drafting improvements, the effect of those tabled by the noble Baroness, Lady Turner. However, from the tone of the debate I can see that the amendments are not attractive to noble Lords opposite. That being so, I beg leave to withdraw Amendment No. 4. It follows that as a matter of logic I shall have to resist Amendments Nos. 5 and 7.
Amendment, by leave, withdrawn.
[Amendment No. 5 not moved.]
Clause 20 [Notice of industrial action for employers]:
[Amendments Nos. 6 and 7 not moved.]
Clause 21 [Industrial action affecting supply of goods or services to an individual]:
Baroness Denton of Wakefield Baroness Denton of Wakefield moved Amendment No. 8:
Page 37, line 1, leave out from ("act") to ("is") in line 2 and insert ("to induce any person to take part, or to continue to take part, in industrial action").
The noble Baroness said: My Lords, in moving Amendment No. 8 I shall speak also to Amendment No. 9. It is due to amendments tabled by the noble Lord, Lord Wedderburn, earlier in the Bill's consideration that these amendments have come about. I am grateful to him for enabling us to consider again certain aspects of the provisions in Section 235A which will, I believe, be improved by the amendments.
In particular, Amendment No. 37 tabled by the noble Lord, Lord Wedderburn, during Committee, would have removed subsection (8) of Section 235A. Even though that amendment was not moved by the noble Lord, it prompted us to consider further the need for this subsection. That in turn led us to conclude that subsections (7), (8) and (9) of Section 235A were unnecessary. I hope that the noble Lords opposite will welcome the amendments. I beg to move.
Lord Wedderburn of Charlton: My Lords, I am grateful to the noble Baroness. I understand the main thrust of, first, Amendment No. 8 and then Amendment No. 9. However, I do not quite understand the deletions. My noble friends and I suggested the deletion of subsection (8), even though we were unable to remove it. However, I should like to probe the reasons for the deletions.
As I understand it the only reason for removing subsection (8) is that the same result is brought about by Section 245 of the consolidation Act 1992. That seems to be clear. However, can the noble Baroness say whether the equivalent provisions of subsection (7)—the definition of industrial action—and subsection (9)—defining contract of employment by the wider test of contract for services—apply to Section 235A? Perhaps the noble Baroness can give me the source for that. I could find some of it in the consolidation Act but not all. It may be quicker if the noble Baroness can tell me where to look for each word.
Baroness Denton of Wakefield: My Lords, I hope that I am able to satisfy the noble Lord, Lord Wedderburn. Amendment No. 8 will amend Section 235A(2) so that there can be no question that the rules which determine whether an inducement is actionable in tort or under Section 62 of the 1992 Act will determine whether proceedings can be brought under the new citizen's right. Subsection (7) can therefore be removed.
Once subsection (7) is removed there is no longer any need for subsections (8) and (9), which concern the interpretation of the term "contract of employment". We believe these subsections to be an unnecessary duplication of provisions elsewhere. The issue of what constitutes a contract of employment in connection with industrial action is already covered in existing provisions in the 1992 Act. In the case of proceedings in tort, it is covered in Section 245, and in the case of proceedings brought by a trade union

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member it is covered by Section 62(7) of the 1992 Act. I hope that that clarifies for the noble Lord the reasoning behind the amendments.
Baroness Denton of Wakefield Baroness Denton of Wakefield moved Amendment No.9:
Page 37, leave out lines 38 to 49.
Clause 28: [Dismissal on ground of assertion of statutory right]:
Viscount Ullswater Viscount Ullswater moved Amendment No.10:
Page 47, line 27, after ("(1)") insert ("(read with (2) and (3))").
The noble Viscount said: My Lords, with this amendment I should also like to speak to Amendments Nos.11, 26 and 27. These small amendments to Clause 28 and Schedule 5 are purely drafting amendments to ensure that provisions are interpreted as intended.
Viscount Ullswater Viscount Ullswater moved Amendment No. 11:
Page 47, line 30, after ("(1)") insert ("(read with (2) and (3))").
10.30 p.m.
Clause 32 [Amendments of transfer of undertakings regulations]:
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No.12:
Page 51, line 11, after ("where") insert ("before the transfer —(a)").
The noble Lord said: My Lords, in moving Amendment No. 12 I wish also to speak to Amendments Nos.13 and 14. One of the things that has happened to the Bill (perhaps rather more than most) is that on its way through the various stages of the two Houses it has been buffeted by outside events, especially legal ones. One of those has been a decision of the European Court of Justice in Luxembourg relating to the Transfer of Undertakings (Protection of' Employment) Regulations 1981—in particular Regulation 5 —which were an attempt to implement the 1977 directive on transfers of undertakings.
I have to explain my amendment with some background information. When the transfer of an undertaking occurred Regulation 5 appeared to say —as it appeared the directive said - that the contract of employment and rights and liabilities of employees were passed to the transferee from the transferor employer with the other incidence of the undertaking. Broadly speaking, that is still correct but in the case of Katsikas v. Konstantinidies, reported quite recently, the European Court of Justice in Luxembourg decided that that was not wholly correct and the employee had what they called certain fundamental rights. That is an important stage in the judgment.
Among those fundamental rights was the right to decide by whom he or she would be employed. The employee could not be transferred necessarily under the directive as part of the property, as it were. However, the court insisted that the directive and Community law did not finally pronounce upon the matter. In an exercise of what is fashionably called subsidiarity the court referred the final word back to the national state system of law to determine the fate of the contract of employment. However, I do not think there is any question—although there has been and will be considerable discussion on it that the court looked at the matter in the context of workers' fundamental rights.
What happened was that I then moved an amendment. Much more important, the Government moved some amendments which are to be found on page 51 of the Bill. The Government followed the first precept of the court's judgment to the effect that the employee should have in the positive law of this country a right to object to being transferred. So far, no argument by anyone. The Government then went on to say that where an employee objects to the transfer of an undertaking in which he is employed, that operates in itself, ipso facto, as a termination of the contract of employment with the transferor and that he should not be treated thereafter for any purpose as having been dismissed by the transferor. So what in fact happens with the Government's solution to the Katsikas problem is that any employee who individually objects to being transferred with the undertaking finds that his or her contract of
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employment blows up in his or her face and he or she is left with a right to object which in fact has destroyed any possible rights that he or she could have had either against the transferee or against the transferor.
I submit to the Government that that is not fair. I do not think it is very fair that in a transaction which is set afoot by the transferor employer—after all, it is his decision to transfer the undertaking—an employee who says "I don't want to go" should be left with nothing. The amendment does not go far in giving him or her anything but it does give the minimum. In other words, what we are adding in the necessary condition of the amendment on page 51, line 19, is the right to be paid a sum equal to the amount that the transferor would have had to pay if he had given proper notice to the employee. It gives nothing else—no redundancy pay and no other compensation for any other right. It is simply the right to be paid the money for the short notice period on which most workers work. We think that is perfectly reasonable.
Indeed, it is not just reasonable and fair. It is probably—indeed more than probably—the right answer in law as far as concerns the Katsikas judgment because it is almost unbelievable, and certainly in the jurisprudence of that particular court highly unlikely, that the European Court in Luxembourg wished to say that a worker had a fundamental right to object to the transfer; that the nation state law should then determine what was done with the contract of employment; but I cannot see that the court would then end with the third proposition that the member state could destroy the contract of employment because of the transfer which would destroy all fundamental rights with it. In other words, what the Government's solution does is allow the right to object but then invalidate it by the consequence which automatically follows.
It is my strong submission that that is not within the spirit of the European Court of Justice decision in Katsikas. Nor, I believe, would it be the decision of the court were the United Kingdom taken wearily yet again to the Luxembourg court by the Commission. It is not asking a lot that a worker who knows nothing perhaps—because the employer may be in breach of the obligation to consult—of the transaction of transferring the undertaking until it is afoot the next day should in any event be paid the amount which is equal to the money he would have accrued in lieu of notice. I beg to move.
Lord McCarthy: My Lords, we do not want to continue this debate. We want merely to state that we agree completely with what my noble friend has said. It seems to us that they would be empty rights indeed if the Bill were to stand as it is at the moment. We believe that that would undoubtedly be contrary to the spirit of the decision. We hope that the Government will show a little generosity tonight.
Viscount Ullswater: My Lords, this group of amendments is concerned with the situation where an employee does not wish to transfer to a new employer when the undertaking in which he works is transferred. It follows on from amendments tabled by both sides of your Lordships' House at Report stage

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in reaction to the judgment of the European Court of Justice in what is generally known as the Katsikas case.
The Government's Amendment No. 74A, which your Lordships' House agreed to at Report stage, makes it clear that an individual has the right to inform either the old or the new employer that he objects to the transfer of his employment contract. That amendment provides that, when such an objection is made, the individual's contract terminates. The individual is not dismissed and he is not made redundant. His contract simply comes to an end.
As the noble Lord, Lord Wedderburn, has explained, the effect of Amendments Nos. 12, 13 and 14 would be that an employee would have the right of objection to the transfer of his contract but the contract could only be considered to have terminated without there being a dismissal if the employer, not wishing the contract to be maintained by him, paid the employee a sum equivalent to pay in lieu of notice.
The Katsikas judgment states that a member state is entirely free to provide that,
"the contract of employment or the employment relationship may be considered as terminated … on the initiative of the employee".
There is nothing in the judgment to support the argument that the old employer should be obliged to give the employee notice, or payment in lieu of notice, in such circumstances. Nor do the Government believe that such a requirement would be appropriate.
A payment in lieu of notice is generally understood to mean a payment made by an employer who terminates an employee's contract of employment without notice. In a situation covered by the transfer of undertakings regulations, however, the employer is not terminating his employees' contracts, which continue unchanged with the new employer. It is the employee who objects to the transfer of his contract to a new employer under the regulations who terminates the contract, not his original employer. That being the case, the Government cannot accept that it would be right to require the original employer to give the employee notification of termination or payment in lieu of such notice.
The Government do not consider that such payments are necessary or desirable. If an employee believes that the change of employer is significant and is to his detriment, he can resign from his employment with the new employer and claim constructive unfair dismissal under general employment law. If he does not believe that he has grounds for doing that, but nevertheless does not wish to transfer, he can object and have his contract terminated. If he is particularly concerned about receiving a period of notice, there is nothing to stop him transferring to the new employer and immediately offering his resignation, although it would, of course, be for the employer to decide in such a situation whether the notice period needed to be worked.
The Government firmly believe that an employee who does not wish to transfer to a new employer has, as the result of the Government's Amendment No. 74A at Report, in combination with existing provisions, rights which are adequate and which
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satisfy the requirement of the acquired rights directive. The amendments cannot be accepted and I hope the noble Lord will withdraw them.
Lord Stoddart of Swindon: My Lords, the Minister has not dealt at all with the morality of the situation. He seems to be suggesting that the undertaking which is transferring to some other holder owns the employee who becomes its chattel and that the employer can with him do what he likes. There is no defence which the employee can give, and there is no protection for him unless he is given the amount in lieu of notice which he would normally expect to get if he were dismissed by his employer at a moment's notice. That is what could happen.
Lord Wedderburn of Charlton: My Lords, the noble Viscount does not seem to wish to reply to my noble friend. I do not believe that there is much more to be said. It is not true that if the employee crosses to the transferee employer he will necessarily be able to engineer constructive dismissal. It is not true that the transferor will necessarily do more in that respect. I shall look very carefully in Hansard, but I did not recognise the words that the Minister appeared to be quoting from the Katsikas case about termination of the agreement. The judgment states that the fate of the contract of employment rests with the member state's law.
The employee has a fundamental right to object to being employed by the transferee and that is what the Government have overlooked. Of course it is difficult to put that together with the position of the transferor who is transferring the undertaking. All we have asked is that the employer, who is the transferor, should pay what he would normally have to pay to someone whose employment he is ending. But that does not seem to be acceptable.
The Government's position appears to be, "Let them eat transfers". That is not satisfactory to us.
10.45 p.m.
On Question, Whether the said amendment (No. 12) shall be agreed to?
Their Lordships divided: Contents, 15; Not contents, 34.

Division No. 3

CONTENTS

Attlee, E.

Lockwood, B.

Clinton-Davis, L.

McCarthy, L.

Cocks of Hartcliffe, L.

Rochester, L.

David, B.

Stoddart of Swindon, L.[Teller.]

Dean of Beswick, L.

Dormand of Easington, L.

Tordoff, L.

Eatwell, L.

Turner of Camden, B.

Graham of Edmonton, L.[Teller.]

Wedderburn of Charlton, L.

NOT-CONTENTS

Arran, E.

Denton of Wakefield, B.

Astor, V.

Elles, B.

Belstead, L.

Ferrers, E.

Blake, L.

Fraser of Carmyllie, L.

Blatch, B.

Goschen, V.

Brougham and Vaux, L.

Harlech, L.

Caithness, E.

Harmar-Nicholls, L.

Cox, B.

Harmsworth, L.

Craigmyle, L.

Hayhoe, L.

Cumberlege, B.

Henley, L.

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Hesketh, L.

Skelmersdale, L.

Howe, E.

Strathmore and Kinghorne, E. [Teller.]

Long, V. [Teller.]

Mackay of Ardbrecknish, L.

Thomas of Gwydir, L.

Mackay of Clashfern, L. [Lord Chancellor.]

Ullswater, V.

Wakeham, L. (Lord Privy Seal.]

Norrie, L.

Rodger of Earlsferry, L.

Wynford, L.

St. Davids, V.

Resolved in the negative, and amendment disagreed to accordingly.
10.52 p.m.
[Amendments Nos. 13 and 14 not moved.]
Lord McCarthy Lord McCarthy moved Amendment No. 15:
After Clause 34, insert the following new clause:
("Appointment of National Council.
The Secretary of State shall appoint a National Council, consisting of suitably qualified persons, whose function shall be to monitor wages and conditions applying generally in industries formerly covered by Wages Councils, and to report to the Secretary of State on what steps, if any, are needed to provide protection for employees in those industries.").
The noble Lord said: My Lords, we come to our old friends the wages councils. As the old tunes from the Bill are played for the last time some of us feel like Count John McCormack on his seventeenth farewell tour. This time we are accepting the abolition of wages councils but are asking for a national council:
"consisting of suitably qualified persons, whose functions shall be to monitor wages and conditions applying generally in industries formerly covered by Wages Councils, and to report to the Secretary of State on what steps, if any, are needed to provide protection for employees in those industries".
We table the amendment in order to raise once again the astonishing way in which the Government have failed to advance any consistent case for their policy. It is noteworthy that my noble friend Lord Eatwell asked three questions during the various stages of the Bill. I calculate that he asked six times; twice on Second Reading, twice in Committee and twice on Report. My noble friend asked how many new jobs would come from abolition, how much wages must fall in order to obtain those new jobs and what would be the Exchequer costs of abolishing the wages councils. If we had more time, I should list what the Minister said at col. 509 on 1st March, at col. 777 on 30th March and at col. 896 on Report, and so on. He said that he did not have any reasons. His best reply was his first reply in which he said that if he were to deal in the details that we wanted, we should be there a lot longer. That was the best that he did. Therefore, we are forced to ask the Government how they can continue in that way with no further details and no further facts except their own prejudices.
Indeed, in the course of arguing with us, it seems to me that the Government have contradicted the very arguments with which they began. At one stage the noble Viscount told us that, whereas it was possible for him, for his friends and in particular for the former Secretary of State for Employment to calculate with great precision what the loss of jobs in the future might conceivably be if a Labour Government introduced a minimum wage programme—at one time he gave a figure of 1 million jobs, but that it is all in the future—it was quite unreasonable of us to ask him to tell us what would be the benefits and how many
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jobs were to, accrue if we got rid of the existing set of institutions; namely, the wages councils. That is in spite of the fact that wages councils have been abolished in the past. Parts of wages councils' functions have been abolished in the past; for example, the youth rate and the ability of wages councils to give a range of rates. All those things have happened and are capable of study; and yet the Minister asks to believe that, whereas he can give us precise figures and give us a whole range of different studies to tell us what a set of proposals which a Labour government would like to introduce will do, he cannot tell us what will happen as a result of his own policies.
I suggest that the noble Viscount should make up his mind. It must surely be the case that any expected change as a result of this legislation must be as a result of an anticipated fall in wages. If there is to be no fall in wages as a result of the abolition of wages councils, there can be no fall in prices, no increase in demand and no employment gain. Anything which happens must happen as a result of a fall in wages, a fall in prices and an increase in employment.
Therefore, if the Government are so certain that that abolition must take place at this time, they must be able to estimate what they believe will happen to wages, prices and demand. Otherwise they are forced to assume, as we assume, that very little will happen to employment and not much will happen to prices but that there will be a significant number —not a large number but a significant number of people on the minimum wage who, when the minimum is taken away, will find, as happened after the abolition of previous wages councils, that their wages are falling without any observable benefits for anyone else.
If the Minister says that he knows all that, then he has nothing to fear from agreeing to the amendment because we are merely asking that the matter should be studied to find out which of us is right and which of us is wrong. I beg to move.
11 p.m.
Lord Rochester: My Lords, as the noble Lord, Lord McCarthy, said, it must now be acknowledged that the House has accepted the principle that wages councils are to be abolished and that attempts to limit the extent of abolition or to postpone its application have failed. However, on these Benches we continue to question the validity of the reasoning on which the Government have based their decision.
In Committee, the noble Baroness, Lady Turner, withdrew an amendment calling for annual reports to be made by the Secretary of State following consultation with interested parties, the first to be presented 12 months after abolition on the pay and conditions of employees in industries formerly covered by wages councils. In his reply, the noble Viscount, Lord Ullswater, objected and stated that consultation with, among others, trade unions—and bodies such as those concerned with low pay—meant that any subsequent report would be made against the background of opinion partly critical of the effects of abolition. Accordingly, under the present amendment, it is left to the Secretary of State to appoint to the

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proposed "National Council", which would monitor wages and conditions in the affected industries, people whom he considers to be "suitably qualified".
In his reply to the earlier amendment, the Minister also said that its purpose could only be to establish a platform for further debate on wages councils after they had been abolished. But why should the Government be averse to further debate on the effects of abolition? If their claim that those effects will be beneficial for the economy and for employment prove to be justified, that will become apparent to everyone and the Government's view will be vindicated.
But let us suppose that the fears expressed by noble Lords on this side of the House prove to be well founded because the monitoring body finds that employees in industries formerly covered by wages councils are inadequately protected. The amendment does not call for restoration of the relevant wages councils; it calls only for advice to be given to the Secretary of State on what remedial action should be taken. That seems to me to be a most reasonable proposition and I support it.
Lord Eatwell: My Lords, the clause presently under discussion has been one of the most controversial in the Bill. It has excited great interest among a wide range of institutions and groups outside the House. Indeed, the concern has been so widespread that I think it not unreasonable to say that it has not been, and is not, a party-political matter. In all the discussions that we have had on the topic of wages councils, there has been a persistent theme: a fear expressed not only on this side but also on the other side of the House that the abolition of wages councils will result in a fall in wages, little if any increase in employment and a considerable bill for the Exchequer as declining family incomes require ever greater support in the form of welfare payments.
The noble Viscount sought to reassure your Lordships on those matters. But he has readily admitted that he was not prepared—indeed, he said that he was not able—to provide any quantitative assessment of the probable impact of the measures that he proposed. Both in Committee and on Report, this Chamber accepted the noble Viscount's assurances. The Government readily admit that the consequences of their actions are unknown. They hope that things will be all right, they are even confident that things will be all right; but they cannot present any evidence to show that things will be all right. In those circumstances, it would be irresponsible not to monitor the effects of abolition.
Let us remember that the abolition will affect the lives of 2.5 million of our fellow citizens, most of whom are women. Many of them, for a variety of reasons widely discussed in Committee and on Report, are highly vulnerable. Surely we owe it to them to monitor the impact of abolition and ensure that the Government's confidence is well founded and that the doubts that I and others have expressed were, fortunately, exaggerated.
The proposed national council would, if it proved successful, become a useful source of objective research and information on this contentious area. It
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would clear away some of the disagreement and confusion which have all too often coloured our debates. There is also another reason why the Government would be well advised to accept the amendment. My noble friend Lady Lockwood has made clear throughout the passage of the Bill that the abolition of wages councils is likely to contravene Articles 119 and 5 of the Treaty of Rome and Article 6 of the equal pay directive.
Acceptance of this amendment would, at the very least, be a demonstration of good faith by the Government that they had nothing to hide and a demonstration that they have faith in all those repeated assurances given by the noble Viscount that things would turn out all right. Indeed I would say that if the Government do not accept this amendment, they are seriously letting down the noble Viscount.
In case there should be any confusion I should make clear that a report made under the remit outlined in the amendment would break new ground. It would add to the material currently published in the new earnings survey, giving in particular a solid statistical insight into the wages and conditions in some of the more backward sectors of British industry. Of course by being confined to wages councils industries, this would be in some sense an arbitrary confinement but it would be a useful experiment and if the council works as well as we expect, its remit could be widened. It would be a valuable tool in the formation of future policy.
This amendment is therefore, I submit, an opportunity for the Government to show good faith; to show confidence in their own arguments; and to offer an opportunity to create a valuable resource in future policy making. I hope the Government will accept it as an entirely non-contentious amendment.
Baroness Lockwood: My Lords, I wish briefly to support my noble friends' amendment. It is a modest amendment and, like many other speakers, I do not think it is an adequate substitute for the wages councils which will be abolished. However, it could enable effective monitoring of the situation and it could give the Government the chance to decide whether further measures were required.
I feel that the Minister has been far too cavalier in his dismissal of the effect on pay of the abolition of wages councils and the effect on women's pay in particular. I also feel that he has dismissed far too lightly European law and the implications for equal pay under European law. Indeed we may still see the Government challenged on the issue in the European Court of Justice. If I may say so, I also feel that the Minister has demonstrated his own lack of understanding of our own legislation. The equal pay legislation did not rely on just one remedy that women could invoke; namely, that they could take their individual cases to an industrial tribunal. There was a whole raft of measures that could be invoked such as collective agreements, job evaluation, raising women's pay to the lowest male level, wages councils, and later, after the legislation had been amended, equal value.
The best that the amendment that is moved this evening can do is to provide a pointer for the future. It might just get the Government off the hook if they

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were challenged under Article 5 of the Treaty of Rome; namely, the article which requires member states to take all appropriate measures to ensure fulfilment of the treaty obligations—the obligations in this case being those under Article 119 of the treaty and the equal pay directive. On those grounds alone I hope that the Government may be persuaded to support the amendment this evening.
Lord Stoddart of Swindon: My Lords, if the Government do not accept the amendment, it will be interesting to hear their reasons. It is very late at night. I have already complained that the House has had insufficient time to discuss these amendments properly so I shall not delay the House for long. I shall not repeat the arguments which have already been used. However, there is one argument which perhaps might have some appeal to the Government because at the moment they are undertaking the most rigorous review of public expenditure we have ever known. We find that we shall be £50 billion in the red at the end of this year and that government spending, as a proportion of national income, is now more than 45 per cent. Therefore, the Government are worried about public expenditure.
One of the ways in which the Government can save public expenditure is if employers pay proper wages and the social security system does not have to be used to subsidise them. I suggest that setting up the proposed organisation would give the Government an early warning of trends showing that employers are depressing wages to a level that would have been unthinkable under the wages councils. Therefore, their own interests, the interests of public expenditure and the interests of us all as taxpayers combine to provide one very good reason for the Government to accept the amendment.
Viscount Ullswater: My Lords, I am disappointed that the noble Baroness, Lady Turner, and the noble Lords, Lord McCarthy and Lord Wedderburn, thought it right to put down this further amendment comprising a new clause in relation to the provision in Clause 34. It follows closely an amendment examined in Committee and then withdrawn. In introducing the amendment, the noble Lord, Lord McCarthy, cast his remarks much wider than the amendment itself and then, at the very last minute, returned to it. But he did not really explain what the amendment would do.
I understand the remarks of the noble Lord, Lord Rochester. He has sought to oppose the abolition of wages councils throughout our discussions. I accept his position, but I fear that I cannot agree with him on that particular matter, but our paths will have to diverge at this point.
The noble Lord, Lord Eatwell, began his speech with an interesting comment. He said that this is not a party matter. I rather agree. The Opposition have never said that they would reinstitute the wages councils and they have not done so now.
The new clause seeks to appoint a council of qualified people to report on any steps necessary to protect employees in industries formerly covered by wages councils. It accepts that the councils will be abolished but would immediately assemble a
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collection of experts to recommend that they be replaced. The arguments deployed by noble Lords opposite have not remotely made a case. The amendment is wholly unacceptable.
I must also tell your Lordships that the proposed clause has grave technical deficiencies. It refers to industries formerly covered by wages councils. As drafted, it would cover both those industries subject to the remaining councils, which are abolished under this Bill, and many other industries at one time covered by wages councils. The "experts" would be obliged to examine the jute industry, paper bag manufacturing, all the industries covered by the II wages councils abolished by the last Labour Government and a host of other industries, some of which have not been subject to wage fixing by a council for well over fifty years. I wonder whether that is really what the noble Lord, Lord Eatwell, proposes.
The clause refers to conditions of employment but, other than a limit on deductions for accommodation, wages councils have no powers to fix such conditions. In fact, almost all the councils decide only a basic minimum rate of pay and a minimum overtime rate. It would make little sense to follow up the abolition of the councils by instituting inquiries into matters over which the councils themselves have no powers or influence.
Throughout our discussions, the noble Baroness, Lady Lockwood, has pursued the point that she believes that women would be adversely affected by the abolition of the wages councils. I commend her for her tenacity in that regard. We believe that the abolition of the councils will increase the flexibility of the labour market and improve job prospects for women. Despite the contorted arguments from the other side of the House for full-timers, differentials in wages council industries are more are less the same as the average for all workers. Women's rights to equal pay are backed by the Equal Pay Act, the Equal Pay (Amendment) Regulations and the Sex Discrimination Acts. That is the body of legislation which protects women at work—not the wages councils.
We have again heard a range of ingenious points from the Benches opposite. I do not believe that they add anything significant to the very thorough debates we had on the subject at Second Reading, in Committee and on Report. I do not therefore propose to take up the time of your Lordships' House in once again restating the overwhelming arguments which have been so decisively accepted at earlier stages.
The Government will continue to reduce the burdens on business through deregulation. The Government will continue to take the measures which are necessary to strengthen our economy and to increase employment opportunities. The amendment does not look forward; it looks only back. I ask the House to reject it.
11.15 p.m.
Lord McCarthy: My Lords, we have been seeking today to find names for the various replies from the other side. The response seems to me cheeky. It really is a cheek for the noble Viscount to say that he is

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disappointed with us for putting down the amendment. We put it down partly because we wish him to answer questions. Yet again he has been asked the same question as he has now been asked seven times; and he does not provide a single answer. He simply makes assertions. He does not want to know; he does not wish to find out. He tell us that he knows—although he cannot measure the position and has no facts or figures—that when his Government abolish wages councils all kinds of benefits will flow. It reminds me of the famous remark of Mr. Heseltine when he was the Secretary of State for the Environment. When he disbanded a great research organisation he said, "We don't want research. It only narrows policy options". I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 39 [Restriction of publicity in cases involving sexual misconduct: industrial tribunals]:
Baroness Turner of Camden Baroness Turner of Camden moved Amendment No. 16:
Page 56, line 45, at end insert:
("(c) for cases involving allegations of discrimination in employment because an individual is diagnosed as HIV positive or with AIDS, enabling an industrial tribunal, on the application of any party to proceedings before it or on its own motion, to make a restricted reporting order having effect for such period as the industrial tribunal may decide.").
The noble Baroness said: My Lords, at Report stage I tried to persuade the Minister to enlarge the clause which the Government introduced giving industrial tribunals and arbitration tribunals the opportunity of ensuring privacy in those cases involving sexual misconduct including cases where individuals were alleging discrimination in employment because they had been diagnosed as HIV positive or with AIDS. The Minister at that stage was not persuaded. However, since that time I have received a very interesting report from the National AIDS Trust. It is about HIV and AIDS in the workplace and examines cases of discrimination.
It is clear from the report that while there are many employers whose policy in regard to employees who are HIV positive or who have AIDS is above reproach, and sometimes very supportive, there are many others where quite the opposite is the case. The report lists a number of actual cases in which employees were dismissed as soon as the employer got to know of their condition. In some cases there has not been much that the employee could do because he or she did not satisfy the condition that there had to be at least two years' continuous employment. That happens apparently not infrequently.
However, in other cases employees who were dismissed felt unable to use the law because they were scared of publicity. I quote from one of the advisers who gave evidence to the National AIDS Trust who stated:
"The bottom line is unless you are prepared for the whole world to find out you've got AIDS there is nothing you can do. Your only legal remedy in many cases is to take your employer to an industrial tribunal. Industrial tribunals are not held in secret and if you go to a tribunal and allege that you were sacked because of AIDS you run the risk of that
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appearing on the front page of your local paper and most people are just not prepared to run that risk and I can't say that I blame them. The majority of clients seeking advice wanted to avoid legal action because of the fear that such action would make their HIV status publicly known as shown in the response given when an individual who had suffered a breach of confidentiality in the workplace, when asked whether he had considered legal action said, 'Legal action? That's an even greater breach of confidentiality, isn't it?'."
As a result a number of organisations concerned with helping people who are HIV positive or who have AIDS have been asking the Government for legal changes which would allow HIV-related hearings to be held in camera so that confidentiality could be more easily protected. It is understood that the Government are not willing to do that, believing that a different treatment for people with HIV would further entrench prejudice against HIV-positive people.
However, the amendments we have put down this evening do not ask for that. Bearing in mind what the report which I have just quoted said about local publicity, they refer only to reporting restrictions. It would be up to the IT or the EAT to make a decision in that regard.
The Bill presents an opportunity to do something. Unless something is done, many vulnerable people will suffer discrimination in silence because they will continue to be too scared of publicity to attempt to secure a just settlement of their grievances. I trust, therefore, that this evening the Minister will be persuaded that we have a case and that, even if the wording is not acceptable, eventually something will be done to give protection to these very vulnerable people. Incidentally, I am speaking also to Amendment No. 17, which has been grouped with this one. I beg to move Amendment No. 16.
Lord Eatwell: My Lords, I wish to support Amendments Nos. 16 and 17. I declare an interest as chairman of Crusaid, the national charity which raises funds to care for men, women and children affected by HIV and AIDS. An important part of the charity is the work of our hardship fund which provides immediate practical assistance to those suffering real hardship because of their own infection or that of a loved one.
The hardships created by HIV and AIDS are real enough. They are compounded by ignorance and prejudice. Crusaid's hardship fund has repeated experience of people who have suffered in their employment because of discrimination against someone who is HIV positive. Publicity surrounding HIV infection then creates further discrimination in housing and for children at school. It is the responsibility of a humane society to protect the sick and vulnerable against such ignorant discrimination. These amendments will provide a modicum of protection and go some way to meeting the responsibility we all share.
Lord Wedderburn of Charlton: My Lords, I support my noble friend's amendment. It is well known that discrimination in respect of those who are HIV positive is a growing problem in our society. That is not least in respect of insurance requirements which

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are met at every point. Anyone who has had contact with the problem knows very well that my noble friends have by no means overstated the case.
The amendments may be said to be modest—perhaps unduly so. They apply only in cases of discrimination, but they at least enable the industrial tribunal or EAT to make a special reporting order. One would have thought that, given the social problem and the suffering which is caused in regard to what my noble friend rightly called ignorant discrimination, there is enough for the Government to be with us in wishing to see some such amendment on the statute book.
Viscount Ullswater: My Lords, as I made clear at Report, Clauses 39 and 40 are intended to cover cases involving allegations of sexual misconduct. They were introduced following wide public consultation. That consultation related only to sexual cases and those consulted were not asked for their views on whether special protection should be extended to any other kind of case.
I listened carefully and I appreciate the real concern demonstrated by the noble Baroness, Lady Turner, in what she seeks to achieve through the amendments. I also listened carefully to the concerns that the noble Lords, Lord Eatwell and Lord Wedderburn, expressed in support of the amendments. However, I have to say that the clauses involve a restriction of the important principle of open justice and as such they were only proposed after very careful consideration of all the issues involved. Noble Lords opposite propose once again, however, that the clauses should be extended significantly beyond what was first envisaged and what was covered in the public consultation. Such a move would involve a further erosion of the principle of open justice. It would also have a wide implication for a number of other areas. We have a responsibility to ensure that the principle of open justice is not restricted any more than is absolutely necessary. It is essential in weighing up the interests of individuals against this important principle that full account is taken of the views of all the parties who might be affected, and that all the implications of such a move are considered.
Noble Lords from all sides will thus, I am sure, appreciate that any move to introduce measures of the type proposed must not be undertaken lightly or before thorough consideration of all the issues involved has taken place in the light of public consultations. I hope therefore that the noble Baroness will be persuaded to withdraw the amendment.
Lord Eatwell: My Lords, before the noble Viscount sits down, I was encouraged by what he had to say at the end of his remarks. Will he give an undertaking that the Government will engage in consultation on this matter; and that the consultation which he says is necessary before such a measure would be introduced will be undertaken in the near future so that appropriate legislation could then be brought forward?
Viscount Ullswater: My Lords, I would not seek to be of such assistance to the noble Lord as to give him an undertaking. But I am quite certain that, when matters such as these are considered again for this purpose, the remarks of noble Lords in this House will be taken into consideration.
Baroness Turner of Camden: My Lords, I am sorry that the Minister again felt unable to move in our direction on this important matter. He says that there is an important principle of open justice at stake here. We on this side of the House are in favour of open justice. But it can sometimes mean that individuals in a particularly vulnerable position, such as people with HIV or those who have AIDS, may not feel able to enforce rights that are theirs in legislation. That is desperately unfair.
All the organisations concerned with support for people who are HIV positive, or who have AIDS, have been pressing upon the Government that something should be done. I understand that the National AIDS Trust has been asking that this type of case should be heard in camera. The Government have said that they cannot accept that. They do not feel like moving as far as that. For that reason we put down amendments which were very modest and which only involved reporting restrictions.
However, I note that the Government have said that the next time matters like this are under consideration, the views expressed this evening by noble Lords who spoke in the debate and who have supported the amendments will be taken into account. I cannot do much more about the matter at this point, so I have no alternative but to withdraw the amendment. But I say to the Minister that those of us who feel concerned about these issues will watch very carefully to see what happens in the future, to see how the Government respond to the representations that are made by the specialist bodies working in these areas to help people in this unfortunate position. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 40 [Restriction of publicity in cases involving sexual misconduct: Employment Appeal Tribunal]:
[Amendment No. 17 not moved.]
Clause 44 [Careers services]:
Baroness David Baroness David moved Amendment No. 18:
Page 62, leave out lines 30 to 32 and insert ("and for assisting persons aged up to 21 years who have ceased undergoing relevant education, or disabled persons who are within five years of having ceased to undergo relevant education, to obtain such employments. training and education.").
The noble Baroness said: My Lords, at last we come to Clauses 44 and 45 which deal with the careers service. I should like to point out that this amendment is supported from all sides of the House. Unfortunately the noble Baroness, Lady Seear, and the noble Lord, Lord Swinfen, are not able to he here tonight because of commitments which they undertook long before they knew the date of the Third Reading of this Bill.
The purpose of the amendment is, first, to increase the range of the duty for the Secretary of State to

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include older teenagers within the labour market so that they get careers advice free; and secondly, to take account of the longer period of transition which people with disabilities require in respect of advice about their possible careers.
In exercising Section 9 powers for clients outside Section 8 duty, there will be powers permitting charging set out in Section 10(5). Our aim is to ensure that no older job-seeking teenager in the labour market will be charged for a service. It may well not be the Government's intention to charge such young people. The Bill as written provides that possibility, and we must not allow that to happen.
As we enter the era of contracts with fixed budgets to meet Section 8 duty, which will have been calculated on the basis of eligible service clients, we need to ensure that young people under 21 still within the labour market seeking jobs and those with disabilities within five years of leaving education are classed as eligible service clients for whom charging will not be lawful. We should ask for an explanation of that rather ugly phrase "eligible service clients", which I am told was invented by a Permanent Secretary. It would be rather nice to have an explanation of why those words are used.
Let us look carefully at what the Government currently propose. If funding is not available in a new careers service contract to assist, for example, an unemployed teenager who left education at age 16, the careers service contractor will not have the money to provide the service. It is as simple as that. If one contracts with a painter and on drawing up the contract it is agreed that he should paint five doors and six windows at an agreed price, one cannot therefore expect him to paint another window, a radiator and a skirting board without affecting either price or quality. In a commercial world one gets what one pays for.
So in this new commercial careers service the Government must have a duty and not simply a power to pay up front for a service to assist people at risk and in need. There must be no question whatever of any contractor being able to charge those seeking work who are older teenagers or disabled persons leaving education within five years of leaving.
I have been asked why we chose the age of 21. I should like to explain that a number of people aged 16 leave school and get out of what is called here "relevant education". They may take a job or possibly do nothing and be unemployed for a year or two and then decide they want to come back. Under the Bill as it stands there is no duty on the Secretary of State to provide free careers advice, which would be needed very badly just at that particular point. We all know that young people with disability take longer to develop and decide what they will do. They have to spend longer in the education system. They too need that longer time. That is why we went just beyond the end of teenage to age 21. I hope that that has explained the situation.
This is a very vulnerable group who need to have free advice. We very much hope that the Minister will be able to support the amendment. I beg to move.
11.30 p.m.
Lord Henderson of Brompton: My Lords, I rise to speak in support of what the noble Baroness, Lady David, said most comprehensively. I added my name to these amendments partly because I am particularly interested in the welfare of young people in the transition from school to responsible jobs in later life. We know that even those who are not disabled are in very great difficulties. But for those who are disabled, every help should be given with a will by the Government. They cannot be expected to progress at the rate of those who are well. That is why it is necessary to put the provision of five years into the Bill.
At this stage I should like to say that I very much welcome the introduction of these two clauses into the Bill. It is an admirable initiative by the Government. I regard all these amendments as totally non-party and aimed solely at improving the purposes of these clauses. I believe that the amendments are worthy of being accepted by the Government on that basis.
Twenty-one is an age which is well recognised as being the threshold of adulthood. I would regard the extension of the provisions in Clause 44 to the older adolescents as being essential in the interests of their finding good and appropriate employment which will last them into adulthood and thus be of great benefit to the country in general. We now have far too many young people who are unemployed and without a hope of employment because they have not had proper career training or the advice which goes with it. I should have thought that that part of the amendment was totally uncontroversial and well worth consideration by the Government.
I have already spoken to the other part of the amendment relating to the disabled. It is self-evident. The Government already do a great deal for the disabled in other realms and could take this aspect into account in respect of career training. The period of five years is something which could easily be accepted and is in line with other policies for disabled people. I therefore warmly support the noble Baroness.
Lord Eatwell: My Lords, I too wish to support the amendment. I shall not repeat the arguments put forward by my noble friend Lady David and the noble Lord, Lord Henderson of Brompton, who have so ably made a case for it.
I want to make a point which fits in with the Government's concern of creating greater flexibility in labour markets. It must be remembered that young people at this time of their lives are likely to have limited financial resources. By definition they are out of work or disabled and trying to get into the labour market. In those circumstances they are likely to be considerably discouraged from seeking advice if they are charged for the advice service.
Because they do not have proper information, they will not operate efficiently in the labour market. Charging for advice will make the labour market less efficient. Therefore, in line with the Government's own prescriptions throughout the Bill, it is rational

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that advice should be available freely to the people outlined in the amendment. It would make the labour market work better.
Lord Stoddart of Swindon: My Lords, I should like briefly to support the amendment. Again, I do not wish to repeat the arguments already put forward, but there is perhaps one further argument that can be made.
At present there is a great deal of unemployment among the 16 to 21 year-olds. The great danger is that we lose touch with them. If that happens, many of them will sink into not necessarily a life of crime but into criminal activities through sheer boredom. It is therefore necessary to give them sufficient advice to which they have free access. If the Government take that on board, with the other arguments already adduced in favour of the amendment, they will be helping society in many ways. They will be helping our young people to lead useful lives in a difficult situation and, indeed, may be keeping them out of temptation.
Baroness Denton of Wakefield: My Lords, I have listened carefully to all that has been said on this issue this evening and on previous occasions. I do not believe that there is much between us. We are aware of the needs and dangers which the noble Lords, Lord Eatwell and Lord Stoddart, identified and of the concerns identified by the noble Lord, Lord Henderson of Brompton. The noble Baroness appears to agree that it is necessary to draw a line around those for whom there is a statutory duty. The difference between us relates to how that is to be done. As I Indicated at Report stage, there are attractions in what the noble Baroness proposes. We have fully considered the options but on balance feel that it is in the nature of careers services that such an arbitrary cut-off point is not desirable. Career services should, as far as possible, be responsive to and reflect individual needs and circumstances. Determining exactly who does and does not fall within the group in respect of whom there is a duty is also an issue under the current arrangements. The amount of assistance and the period for each individual varies. I believe that that is something on which we agree. Currently, that is clarified in the Secretary of State's guidance, and it will be in future. There are no plans to change the nature of the guidance in this respect. Clients covered by the Secretary of State's duty, and for whom the service must be available free of charge, will include those in relevant education as defined in Clause 44.
When speaking on this matter during Report stage the noble Lord, Lord McCarthy, indicated that there was no definition of the client group for whom the Secretary of State would have a duty to secure services. That is not correct. They are clearly defined as people undergoing relevant education. "Relevant education" is given a specific meaning in Section 8(3). Section 8(l) also clearly states that there is a duty to secure services for those ceasing to undergo relevant education. There is no doubt about who is in, or who has ceased to undergo, relevant education. We have acknowledged that there is a need to clarify how long there is a duty to secure services for those who have left relevant education. Current and future guidance
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will therefore include people who have recently left such education. In practice that will mean people aged under 21 who have left education, training or employment up to two years earlier and have not settled in suitable occupations. This means that youth training trainees will be covered.
I am sure that I like everyone else in your Lordships' House will agree that the position with respect to those with disabilities is particularly important. As I stated at Report stage, we recognise that for some young people in this category it may take a considerable time for them to establish themselves in the next step in their careers. Consequently, there is no fixed time limit in providing the service to such people. I understand the purpose of this amendment moved by the noble Baroness, Lady David, but perhaps she does not realise it will mean that everyone aged 21 or over ceasing to undergo education will not be covered by the Secretary of State's duty to secure services. I do not believe that that is something she will welcome. It is an example of the difficulty that arises when an arbitrary age limit is stipulated. I hope the noble Baroness accepts that it is our intention by not limiting the duty by age to secure services which will be responsive to individual circumstances and that, as now, the careers service will be available to young people in youth training and the labour market who choose to make use of it for two or more years after leaving education. We will confirm that through the Secretary of State's guidance. As the noble Lord, Lord Eatwell said, it is important for the future of the labour market that these people should not be deterred from receiving advice. I stress that the contracts do not preclude flexible arrangements for services to older teenagers.
As I said in my opening remarks, I believe there is very little between us. We prefer not to draw the line at an arbitrary boundary. I hope that the noble Baroness will consider withdrawing her amendment.
Baroness David: My Lords, I realise that the noble Baroness has tried very hard to reassure us but I must say that I am disappointed and I am not completely reassured. Guidance is not enough. We want this to be on the face of the Bill. The age group 16 to 21 is very vulnerable one. These people may have been out of education for some time. They will not just have left. There is no certainty that they will get the advice they need. The noble Baroness said that the Government would prefer not to draw the line. Under Section 9 the Secretary of State shall have power to secure the provision of relevant services. It is up to the Secretary of State. If he or she thinks that services are necessary after the age of 21, it could be put in the contract that they shall be given. We want to be absolutely secure about this vulnerable age group. I should like to test the opinion of the House.
11.45 p.m.
On Question, Whether the said amendment (No. 18) shall be agreed to?
Their Lordships divided: Contents, 13; Not-Contents, 29.

Division No. 4

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CONTENTS

David, B. [Teller]

Lockwood, B.

Dean of Beswick, L.

McCarthy, L.

Dormand of Easington, L.

Rea, L.

Eatwell, L.

Rochester, L.

Graham of Edmonton, L. [Teller.]

Stoddart of Swindon, L.

Turner of Camden, B.

Henderson of Brompton, L.

Wedderburn of Charlton, L.

NOT-CONTENTS

Arran, E.

Henley, L.

Astor, V.

Hesketh, L. [Teller.]

Belstead, L.

Howe, E.

Blatch, B.

Long, V.

Brougham and Vaux, L.

Mackay of Ardbrecknish, L.

Caithness, E.

Norrie, L.

Cox, B.

Rodger of Earlsferry, L.

Craigmyle, L.

St. Davids, V.

Cumberlege, B.

Skelmersdale, L.

Denton of Wakefield, B.

Strathmore and Kinghorne, E. [Teller.]

Ferrers, E.

Fraser of Carmyllie, L.

Thomas of Gwydir, L

Goschen, V.

Ullswater, V

Harlech, L.

Wynford, L.

Harmsworth, L.

Resolved in the negative, and amendment disagreed to accordingly.
11.53 p.m.
Baroness David Baroness David moved Amendment No. 19:
Page 65, line 35, at end insert:
("(13) The Secretary of State shall make arrangements for the inspection of all services provided in accordance with this section, and shall appoint persons with knowledge and experience in the fields of industry, commerce, education, careers guidance and local government to a National Council which shall receive copies of all such inspection reports.
(14) The National Council, taking account of information presented on the performance of providers of services through inspection reports, shall advise the Secretary of State on all matters relevant to his duties and powers arising out of the arrangements and directions set out under this section.
(15) An Annual Report shall be laid before Parliament by the Secretary of State detailing how he has discharged the duties and powers conferred upon him under this section in the preceding year, providing an outline of his proposed "guidance of a general character" for the coming year (including details of any payments which he has made or proposes to make), and incorporating a summary of the work of the National Council.").
The noble Baroness said: My Lords, the purpose of this amendment is to establish a mechanism for quality assurance: that is what we are after. The Secretary of State currently has an inspectorate for the careers service. While the Bill does not guarantee that that will continue, several references to inspections have been made by Ministers. The proposed subsection (13) will ensure that inspections take place. Recognising that the new inspectorate will have a more difficult role in the future because of the expected variety of providers, we need to look at ways in which the relationship between the Secretary of State and providers is changing.
Currently, the inspectorate reports to the Secretary of State on how LEAs are discharging their duty. In future, the responsibility for securing service delivery as well as for overseeing the quality of performance will be combined in the Secretary of State herself. In those circumstances, the inspectors will be looking at
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the decisions and the actions which are the responsibility of their own Secretary of State. That is a fundamental change. We need to be able to ensure that the inspectors can report, fairly and fearlessly, to their employer about a service for which she is now taking direct responsibility.
It is no criticism of any Secretary of State to say that it is surely asking too much of any one person to accept both the responsibility for the shape of the service and its delivery, and, at the same time, to exercise impartial judgment about how that responsibility is working in practice. Therefore it is important that inspection reports should all be received by a knowledgeable and independent advisory national council.
It is not intended that the proposed national council should be an incestuous body involving merely the careers service providers and practitioners. No, rather it brings together the interests of individuals and of the country. It is therefore not the same as the present careers service consultative group which was established several years ago for the current arrangements which the Bill now seeks to replace.
The functions of the proposed national council will be strategic, unlike the role of the consultative group which will undoubtedly be operational in nature. On the proposed subsection (14), we need the national council, as has been emphasised already, not at an operational level but at a strategic level, to advise the Secretary of State from its independent and authoritative position on key issues concerning her duties and powers.
While we recognise the repeated and welcome statements by Ministers of separate ad hoc consultations with various individual interests, the explanation offered for the present and proposed consultative arrangements does not address the principal independent and advisory functions on policy issues that the national council alone would perform.
In presenting the case directly to the Secretary of State on 17th May, Sir Christopher Ball, director of learning at the Royal Society of Arts, explained clearly the current situation. All supporters of the proposed national council, from across the worlds of education, training, employment and industry, are agreed that it should be advisory in role. The RSA, the Institute of Careers Guidance, the Secondary Heads Association, the National Association of Headteachers, the Association of Principals of Colleges, the National Association of Careers Teachers, and the training and enterprise council movement at large see the national council as a statutory body. We are aware that the CBI envisages a non-statutory national council—that is merely a difference of emphasis in establishing the council. There is no difference of opinion on its function. All are agreed that there should be a national council: that there is a need.
Ministers have referred repeatedly to the existence of the careers service consultative group. We understand from a letter from Sir Christopher Ball that arising out of his meeting with the Secretary of State just a week ago, she accepts that impending

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legislation will inevitably require a review of the role, remit and membership of the consultative group. We agree with that.
The focus of the current consultative group is an appropriate and narrow one, specific to the careers service. The proposed national council has a wider strategic range, as I have said. It would encompass the principal functions of the careers service, together with careers education in schools and colleges and other forms of guidance for learning and work beyond education. The consultative group has its own proper, functional role with responsibility for issues of an operational nature. We have already accepted that written summaries of careers guidance will be dealt with in such a way; but the consultative group does not provide the broad strategic overview which the change in legislation requires if we are to maximise the contribution of high quality, impartial guidance, in achieving the national education and training targets.
We accept fully the continuing role of the consultative group, after appropriate review, in relation to operational matters affecting careers service contract delivery, but we need a national council. I beg to move.
Midnight
Lord Rochester: My Lords, as the noble Baroness, Lady David, said, my noble friend Lady Seear is sorry that she cannot be here tonight. In her absence I am glad to support the amendment. When a similar amendment was moved in Committee, the noble Baroness, Lady Denton, said that there was a lack of clarity as regards the role of a national advisory council. She asked whether its main purpose was to be quality assurance and inspection or whether it would be concerned with strategic planning. I hope that the amendment makes clear that the proposed council would not itself be responsible for inspection but, taking account of inspection arrangements to be made by the Secretary of State, it would advise him or her on all matters arising out of those arrangements.
Beyond that it is apparent that since the matter was previously discussed by your Lordships a strong consensus has emerged among reputable organisations not only for the establishment of an advisory council but on its principal function. That would include the definition of national quality standards, dissemination of examples of best practice and advice on policy issues. It would not usurp the operational functions of the careers service consultative group. However, in answer to an earlier question asked by the noble Baroness, Lady Denton, it would certainly concern itself with the provision of strategic leadership. Its members would not include careers service contractors as such but would include, among others, people with knowledge and experience of industry, commerce and education.
All that appears to be pretty clear cut. Like the noble Baroness, Lady David, I hope that on reflection the Secretary of State will not wish to be responsible for making careers service arrangements and for monitoring them without benefit of advice from an independent body such as that proposed in the amendment.
Lord Henderson of Brompton: My Lords, I too hope that the noble Baroness will receive the amendment sympathetically. I say that partly because of the comprehensive way in which the noble Baroness, Lady David, moved the amendment and also because of what was said by the noble Lord, Lord Rochester. I wish to emphasise that it is important that not merely the Secretary of State but Parliament and the rest of the country should have an audit of what is happening.
That proposal is new and needs to be assessed. The assessment should be from outside the Government. The body would not necessarily be hostile; its membership would be drawn from a wide variety of people who know what is happening and have expertise in this realm. The body would report to the Secretary of State, who would have to summarise its conclusions in an annual report to Parliament. She would also have the power to comment in that report. I do not see that the new initiative can succeed in obtaining the knowledgeable co-operation and consent of all those connected with the exercise, not least the employers in industry, unless a report of those who are monitoring what is happening is laid before Parliament and, therefore, laid before the public in general.
I have no more to say. I hope that the noble Baroness will consider that, unless she keeps the general public with the Government in the policy which they are pursuing on this vital matter of bridging the gap between school and work, then the policy may well fail due to lack of communication.
Baroness Lockwood: My Lords, I support my noble friend's call for an independent national council. In doing so, I stress that there will be a number of complementary measures involved in the process of monitoring the work of the inspectors: for example, the performance of the providers and the inspections; the views of both the consultative group and the national council; and the Government's action. In other words, it is envisaged that once the performance of the providers has been inspected and the views sought of the independent and authoritative national council on those inspections, and on the key operational concerns which will have been fed through from the consultative group to which my noble friend Lady David referred, it will fall to the Secretary of State to take whatever action is thought necessary and also to report to Parliament.
The noble Lord, Lord Henderson, referred to it as an audit. It is very important that the Secretary of State should report to Parliament. That would counter any impression that the new service will have minimal accountability and stability. It will provide a means for the Secretary of State to comment, on the one hand, on any problems, weaknesses or needs and, on the other, strengths and examples of good practice which need to be disseminated.
I must say that on this side of the House we have been rather puzzled by the Government's response to this matter so far. I pay tribute to the profession of careers officers because, on the whole, it has been exemplary. The profession has sought neither to fight the Bill by seeking to hold on to the status quo nor to

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place obstacles in the way of the Government's plans. On the contrary, the profession has supported the central thrust of the Bill and has sought to enhance the new legislation and make it stronger despite the fact that no one has been able to tell us what is wrong with the current arrangements.
When one considers the fact that all the stakeholders, with their wide wealth of knowledge and expertise which they can separately and collectively bring, support the proposal why do the Government not show that they are listening? The profession wants to help. On this side of the House we too want to help to get things right. Surely when head teachers, college principals, TEC directors and the country's leading industrialists, through the CBI, are asking for the same thing, the Government should listen and take note.
I suggest to the Minister that as capable as are her officials and civil servants, they are not head teachers, college principals or the country's leading industrialists. But, with a body of such knowledge and opinion and expertise working with the officials and the Minister, that would be the way to get things right.
Therefore, I believe that we need this council. It would be very valuable. It would be a popular move and I am surprised that the Government are not anxious to take it. In short, it would be a means of helping to ensure that the new service is credible. It might even be a means of establishing what the Government aim to establish in the educational and training field; namely, a world-class service. I hope that the Minister will listen to what is said this evening.
Lord Eatwell: My Lords, I should also like to express my support for the amendment which, as I see it, is designed to be a non-contentious extension of a policy which the Government have already implemented elsewhere. I am sure we all agree that it is important that the quality of careers advice provided for the young people of this country should be of the very highest standard. We also agree that that cannot be assured by the operation of a market in advice. By its very nature, such a market is imperfect. Those seeking advice do not know what they should know and they do not realise that they have received bad advice until it is too late.
Therefore, it is agreed by everyone that it is imperative for the effective operation of careers advice that clear standards are set. Moreover, we all agree that those clear standards should be maintained by inspection. The amendment adds the provision that there should be a means of independently assuring the quality of inspection and of guiding the development of that inspection process as economic and social circumstances change.
I said just now that the Government had already used that device elsewhere. In the Further and Higher Education Act 1992, the Goverment thought it vital to place on the face of the Bill a means of providing independent quality assurance in the form of some of the responsibilities assigned to the further education funding council. The council proposed in the amendment would have a similar independent quality
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assurance role. The Government accepted that that role was necessary in the Further and Higher Education Act 1992. Surely, they will accept that a similar role in like circumstances is necessary here.
Lord Stoddart of Swindon: My Lords, as I previously declared in the House, I act as an adviser to NALGO. I was especially pleased to hear my noble friend Lady Lockwood pay tribute to the careers service. Indeed, throughout the debate on the careers service, those who work in it have been helpful in every way.
Many people cannot understand why the changes in the Bill are taking place. Nevertheless, they accept that that is government policy and that the Government intend—as do all governments - to have their way, even if it is late at night and, of course, after curtailed discussion. However, here we have an amendment which offers the Government the chance to help assuage the fears of those people who have been involved successfully in the service over a long period of time. They are worried about the future role of the service and what it will provide.
The amendment seeks the establishment of a council which would consist of people with the expertise to advise the Government on matters arising from the inspection service. There would be no great cost to the Government because the people involved would virtually be performing their duties on a voluntary basis; indeed, it would be an "expenses only" sort of council. Those who served on it would feel that they were carrying out a public service.
I understood from the Prime Minister that we had a listening government; that is, a government who want to listen to people. Here they have an opportunity to prove themselves. Here is an opportunity in this amendment for them to agree to appoint a council of experts and people who are close to, and know the needs of, industry and commerce—the Government, as well as we, are interested in that—to give them advice on the new careers service. I would have thought this, bearing in mind the expensive quangos set up to deal with various other matters, a cheap method of consulting people and listening to people that would be seized upon by the Government.
I hope that the Government will take seriously the views expressed not only from all sides of this House but, as my noble friend Lady David said, from outside the House too. I believe they would gain in respect, and perhaps even liking, if they gave the impression by accepting this amendment that they really did want to listen. The opportunity is given them through this amendment to form a council which would give them good service and good advice.
12.15 a.m.
Baroness Denton of Wakefield: My Lords, I remind your Lordships that the Secretary of State will be answerable to Parliament for the services she has a duty to secure. She will have to ensure that through the quality assurance and inspection arrangements she can demonstrate that services are performing to

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standard and fulfilling the duty she will have under the Act. There is no statutory duty to inspect the current arrangements and there need be none in the future.
The Secretary of State will judge quality with the advice of the careers service inspectorate and the careers service consultative group and has power to consult other appropriate bodies or individuals she may choose. I am pleased to inform the noble Lord, Lord Eatwell, that the quality will be judged against criteria and standards which will be published and which have been the subject of consultation. As I said on Report, the inspectorate includes staff with direct and recent experience of work in careers guidance and work in careers services.
The noble Lord, Lord Rochester, and the noble Baroness, Lady Lockwood, joined the noble Baroness, Lady David, in asking for a national council. We have listened to a range of voices on the subject of a national council, including the Confederation of British Industry, the Royal Society of Arts, the National Institute for Careers Education and Counselling, the Careers Service Heads of Service Group and the Institute of Careers Guidance. We have concluded that a statutory national council looking only after careers service matters would not be welcomed by the wider guidance community and those with an interest in careers guidance. On the other hand, a statutory national council which attempted to cover all guidance interests, including the careers service, would not be appropriate.
It would be difficult for one national body to give particular attention to the careers service which the duty on the Secretary of State will require and at the same time give attention to the wider field of careers guidance.
When speaking on this subject during the Report stage, the noble Baroness, Lady Lockwood, reminded the House that the Secretary of State was meeting with Sir Christopher Ball, Tony Watts of the National Institute for Careers Education and Counselling and Paul Chubb of the Institute of Careers Guidance. I am pleased to report that a most positive and constructive meeting has now taken place and the Secretary of State will write to Sir Christopher.
I join the noble Baroness and the noble Lord in paying tribute to the work of the careers service to date. The aim of the Bill is to ensure that the country receives the best that the careers service offers. At its best it offers a very high standard indeed. However, we believe that we need to focus consultation specifically on the new arrangements and not try to encompass the broader range of interests that may be covered by a body of the kind proposed by Sir Christopher Ball. We plan to use the careers service consultative group which, by nature of its membership of TECs, gives a link to the business world. It will, as now, consult over the arrangements for careers services.
The noble Lord, Lord Henderson of Brompton, raised the question of reporting. As I said in Committee and at Report stage, 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. In addition, it has been the practice
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of successive Secretaries of State to provide annual reports on the work of careers services. Those reports can be found in the Libraries of both Houses. I can assure your Lordships that such reports will continue to be published.
I can see nothing of value that will be added by imposing a duty on the Secretary of State, and I cannot support an amendment for a separate annual report specifically for the careers service.
I hope that the noble Baroness will accept that that is now the Government's position. I ask that the amendment be withdrawn.
Baroness David: My Lords, the Government's position is quite clear, but it is the same as it has been all along. I was astounded by some of what the noble Baroness said. A good deal of it seemed nonsense.
It is extraordinary that, when all the people concerned in industry, education and the careers service itself believe that this would be a valuable contribution to the new situation, the Government can be so obstinate and continue to oppose the proposal. I suspect that it is the civil servants who are pushing them. Head teachers, college principals, TEC directors and the countries leading industrialists are all in favour, and they are not members of the consultative group, and the consultative group is not a statutory body.
I am very glad that tribute has been paid to the careers service. I believe that it is a marvellous service. I have had a great deal of experience of it in my time. It has behaved wonderfully during the course of the Bill. It has not made an undue fuss but has tried to obtain the best it can out of the Bill to help the service in the future.
Of course we want a proper report to Parliament, and I do not believe that merely to have a report from the Secretary of State would be adequate. Although it is so late and we have just had a Division, I feel that I must make the point that I feel strongly about the issue by pressing the amendment.
12.23 a.m.
On Question, Whether the said amendment (No. 19) shall be agreed to?
Their Lordships divided: Contents, 12; Not-Contents, 28.

Division No. 5

CONTENTS

David, B.

McCarthy, L.

Dormand of Easington, L

Rea, L.

Eatwell, L.

Rochester, L. [Teller.]

Graham of Edmonton, L. [Teller.]

Stoddart of Swindon, L.

Turner of Camden, B.

Henderson of Brompton, L.

Wedderburn of Charlton, L.

Lockwood, B.

NOT-CONTENTS

Arran, E.

Ferrers, E.

Astor, V.

Fraser of Carmyllie, L.

Belstead, L.

Goschen, V

Blatch, B.

Harlech, L.

Brougham and Vaux, L

Harmsworth, L.

Caithness, E.

Henley, L.

Cox, B.

Hesketh, L. [Teller.]

Craigmyle, L.

Howe, E.

Cumberlege, B.

Long, V.

Denton of Wakefield, B.

Mackay of Ardbrecknish, L.

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Mackay of Clashfern. L. [Lord Chancellor.]

Skelmersdale, L.

Strathmore and Kinghorne, E. [Teller.]

Norrie, L.

Rodger of Earlsferry, L.

Thomas of Gwydir, L.

St. Davids, V.

Ullswater. V.

Resolved in the negative, and amendment disagreed to accordingly.
12.31 p.m.
Clause 45 [Careers services: ancillary services]:
Baroness Lockwood Baroness Lockwood moved Amendment No. 20:
Page 66, line 32, leave out from ("period") to ("relevant") in line 33 and insert ("during which that person continues to provide").
The noble Baroness said: My Lords, the purpose of this amendment is to remove the two-year restriction on the supply of goods and services by local authorities. I moved a similar amendment at Report stage and raised a number of questions on which the Minister said that she would write to me. I received the Minister's letter early this evening and I thank her for it. However, it raises as many questions as it answers. For example, the first question that I asked was whether a local authority controlled company would be allowed after two years to make use of local authority goods and services. The Minister replied that a local authority controlled company could be designated as a public body for the purposes of the Local Authorities (Goods and Services) Act 1970.
First, I wish to query the words "could be designated". Surely, we ought to say that such a company "would be designated" because there are remote county and rural areas where there might be no alternative services to those provided by the local authority. I believe that we must safeguard those areas and I suggest to the Minister that it should be that they "would be" automatically designated.
Further on that, I should like to probe a little as to which local authority companies would be included. I understand that in the Local Government and Housing Act 1989 there are at least five interpretations of a local authority controlled company. First, there is a controlled company at arm's length. Secondly, there is a not controlled company at arm's length. Thirdly, there is a company with majority influence. Fourthly and fifthly, there are two minority interest types of company. That gives us a total of five. Will all the five types of company be in the same position, or will some of them he in a position where they could automatically continue to purchase local authority services?
Secondly, the Minister has given me a definite and affirmative view about premises. She says that premises are not affected by the two-year rule. That is welcome. Thirdly, I asked whether a local education authority and training and enterprise partnership would be subject to the same rules whether the LEA signs the contract or the TEC signs the contract. Here the Minister says that in essence I would be right and that they would be treated differently, depending on who signed the contract. So if one signed the contract then they would be subject to the two-year rule, but if the TEC signed the contract, then they would not be. The Minister goes on to say—and here I am very puzzled—that:
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"It may depend on the nature of the partnership involved. We would advise potential providers to seek their own legal advice on this matter".
That is pretty outrageous. Here we have a new Bill going through Parliament and all the Government can do is to advise potential providers to seek their own legal advice. Surely the Government should be able to indicate whether or not LEA or TEC partnerships would be caught under this provision.
Fourthly, I ask the Minister whether a local authority would be able to do business with a careers service provider where the business derives from functions retained by the local authority. Again, the Minister tells me:
"This may be possible, but it will depend on the nature of the business which is proposed. It may depend on what is proposed and the arrangements the Secretary of State has with the provider".
Again, that is absolutely unsatisfactory. We ought to know what is meant by the provisions under this Bill, and the Minister appears unable to tell us.
My last question was whether it is accepted that there will be some risk to local taxpayers where the local authority is awarded the contract; and whether in such circumstances the Secretary of State will cover any deficit. The Minister says that the Secretary of State,
"will be exercising all reasonable care in the placing of contracts and issuing of directions. She will also be monitoring the arrangements to ensure that if there is a potential failure of either the contract or the directions she is able to remedy the situation or make alternative arrangements".
This will all be done at arm's length. But finally, in the last resort, the Minister will not be able to make specific provision to underwrite any deficits either on the part of the contractors or the directed authorities. So the Secretary of State will go so far but no further. I am grateful to the Minister for her reply, but it raises as many questions as I posed previously.
The real issue here is: why is there a difference in the way we are treating the careers service? For example, under the Further and Higher Education Act 1992 there is no such provision on local government providing services. Under the 1992 Act colleges, which we might say are in a similar position to the careers service, can continue to buy local authority services—similarly, under the Education Bill that is going through this House at the present time. While on this side of the House we certainly regard the provisions in that Bill as unsatisfactory, nevertheless they provide for grant-maintained schools which will be designated as public authorities to continue to trade at the margins with the local authority.
Why is there that discrepancy and that discrimination against the careers service? Is it because the measures are coming from different departments and the Ministers in the departments have not been advised of the differences in the provisions? Or is it because the departments are not speaking to each other and sharing their views? The Minister needs to give many more answers on this question than she has given so far. I beg to move.
Baroness Denton of Wakefield: My Lords, I tried to cover the points raised by the noble Baroness at Report stage. I shall now try to extend those answers.

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First, perhaps I may say that this clause is to allow 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.
Having said that, I emphasise that local authorities exist primarily to perform their statutory functions and trading is not their primary function. The purpose is to extend. If indeed the local authority itself is a provider, there is no limitation on the provision of goods and services. There is a facility whereby it may be possible for such services to be provided to new careers services for a period longer than two years. But the careers services will be in a similar position to grant-maintained schools. I am informed that there is a two-year limit for grant-maintained schools.
Perhaps I may also answer the noble Baroness's query on controlled companies. The designation of a controlled company as a public body bears on the nature of the undertaking. That is determined by criteria established by the Department of the Environment. It means that local authority controlled companies can apply to be designated. As the nature of contracts must be between the parties concerned, it does not seem so unfair, as the noble Baroness would have it, that the potential providers should seek their own legal advice. It is not an area in which one can generalise.
As I said in my opening remarks, the aim of the clause is to allow the transitional period to the providers of careers services to enable them to use local authorities' administrative, personnel and computer services and where possible, as regards the question of premises, that purpose will be extended. But it will not allow the local education authority a licence to trade indefinitely.
I hope that the Government's position on this amendment, which has not changed, is clear.
Baroness Lockwood: My Lords, I do not think that the Government's position is quite so clear as the Minister said. The one thing that is clear is that this clause, as the Minister said, is in order to enable new providers, as it were, to come on stream and for the local authority to continue to help them until such time as they no longer need the help of the local authority. That is rather unfair on local authorities who have provided a good service in the past.
The Minister said that the local authority is there to fulfil statutory functions. I thought that the local authority was there in order to provide the services that the local community required. I should have thought that in the context of the career services some of the provisions were necessary and it was necessary for the local authority to provide them.
Neither am I satisfied with the reply from the Minister on the different nature of companies. The nature of the undertaking dictates what category they conic into. We should have more clarification on that point. I am not in agreement with her when she says that providers should have to seek their own advice. Again, there should be much more clarity under the Bill.
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However, we may have thrown a little more light on the situation in raising the matter again this evening. In view of that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
12.45 a.m.
Schedule 4 [Provisions substituted for sections 1 to 6 of 1978 Act]:
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 21:
Page 79, line 8, after ("may") insert ("if written consent has been previously signified by or on behalf of the employee and").
The noble Lord said: My Lords, Amendment No. 21 concerns a matter which was newly introduced into the Bill at Report stage. With few exceptions it affects the rights of all workers. When the Bill is enacted the right will apply to every worker who has worked for eight hours a week for one month.
It is agreed on all sides that the right is an important one. It is the right to have written particulars of the terms and conditions of the contract which will fulfil the objective of what is sometimes called "greater transparency", but which is perhaps more easily stated as making the employment terms clear both to the employer and employee and avoiding misunderstanding.
For 30 years we in this country have had such a right on the statute book. It was first enacted by the Conservative Government in 1963. I have no hesitation in saying that on this matter our system has been in advance of many systems on the Continent. The problem which has been thrown up at this last stage is whether the employee can be compelled to receive the written particulars by instalments.
I appreciate in everything that I say, that the Government have put into the Bill a requirement that in the instalments the most important terms are to be put together in what is called the "principal statement". Nevertheless, a large number of terms could be issued in bits and pieces which would make it extremely difficult for many employees to know precisely where they are.
My noble friends, and indeed the noble Lord, Lord Rochester, queried the wisdom of what was being enacted. I stress that this is a provision which will apply to almost every employee in the land, and which we have had some three weeks —18days—to consider. Instalments are not required by Directive 533 of 1991. As I understand it, they were included by the Government after discussions with the CBI or, at any rate, with the noble Lord, Lord Mottistone. Indeed, having studied the matter since the debate on Report, I doubt whether it is clear that the directive that Schedule 4 purports to implement really allows of instalments in the matter. This is a late stage at which to say that. I am driven to say it now because the matter was not raised before Report or while the Bill went through your Lordships' House and the other place after Guy Fawkes day 1992, when it was conceived.
The directive states in Article 3:
"The information referred to in Article 2(2)"—
those are the important matters—

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"may be given to the employee, not later than two months after the commencement of employment, in the form of: (a) a written contract of employment; and/or (b) a letter of engagement; and/or (c) one or more other written documents, where one of these documents contains at least all the information referred to in Article 2(2) (a), (b), (c), (d), (h) and (i)".
which are, again, important matters. That article does not say that the two or more written documents can be given to the employee at different times. It seems that the Government have gone out on a limb. I know of no authority for the view that this is permitted under the article. Even if they had cleared the matter with the Commission it would still be possible for the court to take that view. We have seen already in the Katsikas case that the court has a clear concept of the fundamental rights of employees. It is quite possible that the court will take the view that the three choices of a written contract of employment, which is quite different from written particulars; a letter of engagement, which again is quite different from written particulars; or one or more other written documents, which are the written particulars, can necessarily be dribbled out to an employee on different occasions during the two months.
The Article 3(2) requirement for the employer to sweep up anything that has been omitted at the end of the two-month period by what is called a written declaration—which plays the role of sweeper in the directive's team—is not necessarily consistent with instalments. Indeed, it seems to say that where you have failed to give particulars on one occasion there must be a sweeping up at the end. That is not the Government's scheme of things by instalments. Nor is it possible to see why instalments are a good idea. Instalments of pieces of paper are more easily lost. They increase the amount of paper.
In discussions on this matter I have been presented with such a large number of doubtful situations that I ask the Government to allow the employee at least to have the right to consent or otherwise to instalments of this kind. I cite just one of the many possible situations. Take the case of an employee who is hired on 1st January for eight hours a week. On 5th January an instalment comes from the employer. (I pause to say that that relates to a contract already made which presumably the court will have to interpret.) The instalment says that the notice period is two weeks. At the end of the month a principal statement is issued, part of which incorporates a collective agreement which we hope, with the next amendments, will be accessible at the place of work. Those collective agreements state different terms as to notice of termination of the contract. The employee now wishes to give notice. How much notice should be give? That is not just the kind of problem that one puts into examination papers with the magic word "discuss" after it. It is a very real situation.
The answer is unclear. For example, it is not clear that the provisions of Section 4 relating to changes in the terms and conditions in the written particulars apply at all. This is not a change but an inconsistency. There is no internal reference in the two bits or pieces of the instalments. That is a very simple illustration. It
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can get much worse if one posits a situation that an employer may I suppose find very convenient in a badly-run firm. I do not think that well-run firms will run into difficulties on this issue. It is the bad firm and bad personnel officer who will get into difficulties and start to give written particulars of employment, on which all rights depend on both sides, in five, 10 or more instalments and pieces of paper. That will be the ocean of paper which I have suggested on many occasions everyone wants to avoid. Looking again at the directive, I suspect that that situation is avoided by not allowing the procedure that the Government have adopted—a procedure which is highly unsatisfactory, especially from the point of view of the employee.
Therefore, I suggest that if the employer wants to do it—my amendment will not ban instalments in any way, though I think they are a bad idea—he should make it clear to the employee he has hired, admittedly on a piece of paper, though a small one, that he will give the employee instalments if he consents. If an employee wants his written particulars and rights set out down in a piece of paper that he can take home, no doubt with reference to other documents, he should have that right. I believe that after a period most personnel management officers will come to see that this is a more sensible way of doing things, with a few exceptions, in which cases they can take the consent of their workers.
Lord McCarthy: My Lords, we do not want to debate this matter at any length but we do want to say that my noble friend Lord Wedderburn has a serious and significant point. Whether or not the Government want the solution advanced by my noble friend is another question. Perhaps they do. We think they should. But they should, whether they do or not, take on board the problem. This is another example of something which has somehow got into the Bill at the last minute. We do not know whether there have been full consultations. We do not know whether the TUC has been consulted. What we know is that the more we look at the way it seems to be going to work, the more worried we are.
The Bill, it is true, says that there will be a number of items in the employment particulars. They will be in the principal statement. But there will be many others—the scale of remuneration; the intervals of remuneration; the hours; sick pay; notice; the collective agreement details. All these points can be dribbled out, as my noble friend said, in certain subsequent instalments. Have the Government thought whether there is to be any limit to the number of instalments? How do they feel the various bits that are not in the principal statement should be dribbled out? It looks to us like a most unsatisfactory development. We believe that they ought to think again.
Baroness Denton of Wakefield: My Lords, as the noble Lord, Lord Wedderburn, rightly pointed out, the provisions enabling employers to provide the written statement in instalments were introduced the last time we debated this Bill on Report. We made the change to help employers administer the requirements. We were persuaded by the arguments of my

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noble friend Lord Mottistone that the requirement to provide all the information in a single document was unnecessarily bureaucratic and would make the administration of the provisions more cumbersome and difficult than necessary.
We do not believe that this provision in any way detracts from the employee's right. In many cases it will enable individuals to receive information earlier than they would otherwise have done. The employer will not need to wait until he has assembled the full set of information before providing a new employee with any of it. In all cases, however—this is the limitation that the noble Lord, Lord McCarthy, looks to—all the information will have to be provided by the end of the two-month period.
The noble Lord, Lord Wedderburn, raised the issue of the relationship with the directive. The EC directive clearly contemplates that the written statement may be given in the form of several separate documents. As I explained, it requires only that certain specified particulars be included in a single core document. The Government are fully committed to meeting their obligations under the directive. The provisions in the Bill will not only achieve that but in some respects will go further.
The noble Lord suggests that where an individual sees advantage in this he should be able to agree to it but in other cases it should not be imposed on him. The provisions have been criticised on occasions—and, indeed, again just now—for the amount of paperwork they may require. Here we have an amendment which seeks to add to it. Every new employee would be given the choice of receiving information as soon as it is available or waiting for perhaps two months until all the different items are ready and receiving them all together. Everyone who chose the former would have to write to his or her employer. Employers would not supply the information until they had written permission, and would have to keep records of who had written and who had not. I cannot agree that this elaborate procedure is necessary or helpful, and I hope that the noble Lord will not press the amendment.
Lord Wedderburn of Charlton: My Lords, if I took the precedent of my noble friends as to the importance of the matter I would test the feeling of the House. I shall not do so. The noble Baroness spoke of the directive allowing several documents, which is absolutely right. I do not think that she spoke of several documents on different occasions, which is not mentioned in the directive at all. However, whatever the directive says, the schedule is now a terrible mess. It changed in enormous proportions in some respects in the other place. The Government have never been clear as to exactly what they want, although, of course, they want to implement the directive. I now hear that they were persuaded by the noble Lord, Lord Mottistone. If he were in his place I would express a view as to what his persuasion amounted to, but as he is not, I shall let it pass. It is really not based on sensible management practice. I believe that managers, above all others, are going to have a terrible time with this legislation. It is a terrible mess. Given that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
1 a.m.
Baroness Denton of Wakefield Baroness Denton of Wakefield moved Amendments Nos. 22 to 25:
Page 80, line 28, after ("or") insert (", subject to subsection (2A),").
Page 80, line 31, at end insert:
("(2A) A statement under section I may refer the employee to the provisions of a collective agreement under subsection (2) (b) if, and only if, it is an agreement which—

(a) the employee has reasonable opportunities of reading in the course of his employment, or

(b) is made reasonably accessible to him in some other way.").

Page 82, line 20, after ("or") insert (", subject to subsection (3A),").
Page 82, line 23, at end insert:
("(3A) A statement under subsection (1) may refer the employee to the provisions of a collective agreement under subsection (3) (b) if, and only if, it is an agreement which

(a) the employee has reasonable opportunities of reading in the course of his employment, or

(b) is made reasonably accessible to him in some other way.").

The noble Baroness said: My Lords, I am happy to bring forward this group of amendments, which fulfil a commitment made to the noble Lord, Lord Wedderburn, at Report stage. The amendments provide that where, either in the written statement of employment particulars, or in a subsequent statement of change, details of notice entitlement are given by reference to a collective agreement, then that agreement must be one which the employee has reasonable opportunities of reading in the course of his or her employment or which is made reasonably accessible to him or her in some other way. These are modest changes which have the helpful effect of ensuring greater consistency in the provisions concerning the use of reference documents, and I commend them to the House. I beg to move.
Lord Wedderburn of Charlton: My Lords, I am grateful to the noble Baroness. At the last gasp we have an improvement to the Bill which I suppose testifies to something about our procedures. I am grateful.
On Question, amendments agreed to.
Schedule 5 [Employment protection in health and safety cases]:
Viscount Ullswater Viscount Ullswater moved Amendment Nos. 26 and 27:
Page 86, line 25, after ("(1)") insert ("(read with (2) and (3))").
Page 86, line 29, after ("(1)") insert ("(read with (2) and (3))").
The noble Viscount said: My Lords, with the leave of the House, I should like to move Amendments Nos. 26 and 27. They were spoken to with Amendment No. 10. I beg to move.
On Question, amendments agreed to.
Schedule 8 [Consequential amendments]:
[Amendment No. 28 not moved.]
Viscount Ullswater: My Lords, I beg to move that the Bill do now pass. It is only a little over two months since the Trade Union Reform and Employment Rights Bill had its Second Reading in your Lordships'

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House, yet in that short time a number of significant changes have been made to the Bill, as well as many more smaller changes which will also improve it.
The Bill has grown by no fewer than eight clauses in your Lordships' House. A number of these new clauses were welcomed by noble Lords on all sides of this House. Clauses 39 and 40, for example, on which public consultation was held early in the year, and which will provide that individuals' identities may be protected in industrial tribunal and Employment Appeal Tribunal cases involving sexual misconduct, was welcomed by many noble Lords. I am pleased to say that these provisions were improved by the acceptance of amendments tabled by the noble Baroness, Lady Turner, one of which has the distinction of being accepted not only verbatim, but also sight unseen.
Clause 41 should also not go unmentioned at this point. The suggestion that there should be additional powers to restrain vexatious proceedings in tribunals was advocated with great enthusiasm and vigour by my noble friend Lady Gardner of Parkes. We were pleased to act on her suggestion in this area.
Your Lordships also accepted new Clause 38, providing that individuals, supported by proper legal advice, may opt out of their right to bring a particular case to an industrial tribunal once they have reached a settlement with their employer. I know that this subject had the support of many noble Lords, among them my noble friend Lord Mottistone, who has spoken so eloquently throughout our debates on behalf of employers in general and the CBI in particular.
Your Lordships have added a number of other important provisions to this Bill, which will improve the rights afforded to men and women at work. When this Bill becomes law all employees, regardless of their period of service or hours of work, will be protected against unfair dismissal for the assertion of a statutory right. Most employees will be entitled to receive an itemised pay statement. And employment protection legislation will be extended to the armed forces.
The improvements to the Bill made in your Lordships' House are not confined to those significant issues. Numerous smaller amendments have been accepted, which will improve the drafting and the sense of the Bill and make it ultimately a better piece of legislation. By my reckoning a total of 84 amendments have been made to the Bill since it entered this House. A significant number of those—some 20 amendments—were put forward by, or drafted at the instigation of, noble Lords on the Benches opposite or the Back Benches on this side of the House. Their variety and scope testifies to the close and careful scrutiny that your Lordships have given the Bill.
I would convince no one though were I to claim that as the Bill leaves this House, noble Lords are in agreement about all its merits. Parts of the Bill have been scrutinised closely, criticised, and debated vigorously, and that is as it should be, for these are matters of great importance. Only today we have debated the Government's new clause which amends
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the law on action short of dismissal as set out in Section 146 of the 1992 Act. We are not in agreement across the House about the need for an amendment of this nature. The Government remain convinced that it is right to clarify the law in this area. It was right too, though, that the matter should be debated fully by your Lordships before entering onto the statute book.
The same is true of the abolition of the wages councils. The proposal has come under very close attention, as it should, for it is one of the greatest importance. The Government remain convinced that abolition will improve the operation of the labour market and assist in the creation of new jobs.
Many noble Lords—far too many to mention Individually—have assisted in our debates and deliberations on the Bill. I should like, however, to pay tribute to particular noble Lords and noble Baronesses who have made extensive contributions to our proceedings. On the Benches opposite, the noble Baroness, Lady Turner, and the noble Lord, Lord McCarthy, have covered the full subject matter of the Bill with great diligence and determination. And if any of us thought that news of the resignation from the Front Bench opposite of the noble Lord, Lord Wedderburn, would mean that the House might lose his very close scrutiny of our proposals, we were soon proved wrong. The noble Lord, Lord Rochester, and the noble Baroness, Lady Seear, have also contributed valuable insights and comments to all deliberations, in both cases from a position of deep knowledge and concern. On the Cross Benches the noble Lord, Lord Henderson, in particular has also contributed valuable insight and knowledge to our discussion of employment rights. On this side of the House, I should like to pay particular tribute to the contributions made by my noble friends Lord Mottistone and Lord Swinfen, which have elucidated and enlivened our debates. Finally, I should like to give special thanks to my noble friend Lady Denton, without whose unfailing and invaluable support my task would have been infinitely more difficult. I beg to move.
Moved, That the Bill do now pass.—(Viscount Ullswater.)
Lord McCarthy: My Lords, I am not certain that the House has ever considered the Third Reading of a Bill at one o'clock in the morning, but I suppose that we have to have records, and this must surely be nearly one of them. Late though it is, we feel that we must make a few swift points about the Bill.
The Bill is the most extensive and far-reaching of the eight sons of Frankenstein. It is not as fundamental as 1981; not as invasive of union autonomy as 1984; not, perhaps, as one-sided as 1986 so far as concerns the worker; but the biggest, covering the widest ground. The essential paradox of the Bill is that the bits the Government have been forced to do are the good bits of the Bill, and the bits that the Government have wanted to do are the bad bits of the Bill.
There is not much more to be said tonight about the good bits of the Bill. We tried to improve what was there on maternity relief; we tried to improve and include something on maternity pay; we tried to improve what was said about transfer and redundancy

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rights; and we made a number of small advances. We would still argue that the good bits in the Bill are not good enough, and that in a number of cases it imperfectly implements EC directives. We would still argue that the Government will have trouble in the European Court with the good parts of the Bill.
So we turn to the bad parts of the Bill. We have tried to do something about Part I relating to trade unions. I shall deal with that in a moment. As regards Part II we have had arguments about wages councils. We debated that issue and I do not want to cover old ground. We tried to concentrate centrally on what the Government want to do to the careers service.
We were singularly unsuccessful. We made four basic criticisms of what the Government wanted to do about the careers service. First, their proposals were not based in any criticism of the existing set of arrangements. No one came along and told us, as they should have done, that the existing careers service was failing the nation. There were no criticisms; the Government just wanted to change the service. Secondly, the Government gave us no alternative structure, a set of improved objectives or a set of higher standards. We were merely told that persons of any other description would run the service in future.
Thirdly, we were never told who would be responsible for running and monitoring the service except the Secretary of State. Tonight we tried to improve that aspect of the Bill by proposing the introduction of a national council. We had tried before and we tried again. But the Government were not interested in who would be responsible for running and monitoring the service except the Secretary of State. Fourthly, we received no guarantee that there would be available as much money to run the service as there is now. No promises were made about the resourcing of the service. Therefore, we made no advances on what the Government intend to do about the careers service.
Finally, I turn to Part I relating to what the Government wish to do to trade unions. There are three points to stress. First, the Government wanted to come, after a whole series of previous sons of Frankenstein which seriously curtail the right to strike and the autonomy of trade union government, and have introduced all kinds of financial liability on to trade unions. We must point out that each time the Government come forward with another son of Frankenstein they do so on top of many other measures. I argue that with the single exception of 1982, this legislation is the most radical, far-reaching and least justifiable that the Government have introduced on the trade union movement. The Bill embodies numerous restrictions on the autonomy of trade unions of an unprecedented kind. They are unknown in other countries and in similar organisations.
I argue that there are seven major degrees of uniqueness which the Government ask us to accept about the trade union movement. First, that trade unions have no right to receive from the governing body of unions in amalgamation cases the kind of independence, responsibility and freedom which, for example, companies have. They have the strange affair
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of the double envelope. Secondly, there are precise and comprehensive regulations about who unions can admit and expel. No similar restrictions are placed on professional associations and voluntary organisations of all kinds. Thirdly, trade unions have a legal duty to finger their members who may be contemplating a breach of contract. No similarity or parallel exists in any other organisation.
Fourthly, trade unions face the threat of injunctive action by third parties, including employers, who suffer no measurable damage whatever. There is no parallel with the kind of impost and responsibilities under that heading which are placed on British trade unions. Fifthly, they have limitations on their rights to collect subscriptions—subscription income by agency —which affects no other body of a similar kind. Sixthly, a system of automatic disqualifications and fixed penalties are imposed upon their officers. Finally, they must supply their members with details of their emoluments and officers' salaries, which does not appear in legislation affecting any other similar group.
Therefore, there are seven different forms of uniqueness. We have asked the Government over and over again at every stage of the Bill what it is about trade unions which makes them so unique that the seven different degrees of uniqueness are imposed upon them. Why are no such measures imposed upon companies, clubs, professional and voluntary organisations or on employers' associations? Why is trade unionism so unique that such provisions must be applied in this country which are not applied in other countries, not to Lloyds, not to clearing banks or political parties but only to trade unions?
The Government have given us a number of answers. The noble Viscount said on 16th March that unions and companies are two completely different beings. Therefore, the laws which govern them are two completely different laws. The noble Baroness, Lady Denton, said:
"Attempts to make comparisons between company law and trade union law are neither apt nor useful … unions and companies are different organisations, with a different legal status and different relationships with their members or shareholders—their subscriptions are membership payments and not investments".—[Official Report, 16/3/93; cols. 1421 and 1422.]
The noble Lord, Lord Boyd-Carpenter, who unfortunately is not in his place said:
"We are not concerned with joining a club. Generally the question is whether a club will accept the candidate. All I say is that it is wrong for the law to intervene and deny, in the case of a trade union, the right of an individual to join the one that he wishes to join".—[Official Report, 18/3/93; col. 1567.]
On Report the noble Viscount, Lord Ullswater, said that the law relating to trade unions and the law relating to companies is quite different, is quite distinct and needs to be treated differently.
We are never told what it is about trade unions which makes them so different. We are told only that they are different. I said before that either they are uniquely powerful, which is nonsense, or they are uniquely corrupt, which the Government do not suggest. Therefore, it must be that trade unions are

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disliked by the Government. That unique dislike on the part of the Government is clearly embodied in the Bill and that is why we oppose it.
Lord Rochester: My Lords, as the noble Viscount, Lord Ullswater, said, it is a long time—I make it nearly three months—since the Bill received its Second Reading. On that occasion I said that although a case could be made out for some of the individual proposals in Part I—indeed, on a provision concerning the election of union executive committees my noble friends and I voted with the Government—in our view many of the proposals had more to do with persisting in a policy which although appropriate for the early 1980s today savoured too much of continuing to knock trade unions when they no longer offer any serious threat to the well-being of our society.
I said that some of the measures smacked of mean mindedness and would do nothing to encourage co-operation between management and employees which was so badly needed if economic recovery were to be achieved and sustained. That remains our view; for example, Clause 5 provides that voting papers for a union merger ballot, unlike that which happens in the case of companies, may not be accompanied by any other material; and Clause 7 phases out government funding of union ballots.
As the Bill has progressed through its various stages, we have come to feel that the Government are open to a more serious charge—namely, vindictiveness—even to the point as I said earlier today, of seeking to undermine what we see as the right of people to combine together and ultimately, if the need should arise, to withdraw their labour. That charge has been made particularly by my noble friend Lady Seear in relation to clauses in the Bill dealing with the organisation of industrial action.
That anxiety has been increased greatly by the manner in which the Government decided to introduce their amendment limiting the right of employees not to have action short of dismissal taken against them by employers to deter them from being union members.
The conflict between the freedom of the individual and orderly industrial relationships was evident in the debates on Clause 13 as to whether the right to join the union of one's choice was outweighed by the need to safeguard single union agreements. The noble Viscount, Lord Ullswater, held that union membership was a matter for union members and union recognition a matter for employers. Our fears remain that, in practice, the two matters will prove to be inseparable and that inter-union disputes will multiply at the expense of employers and the economy.
It is significant that it was the noble Lord, Lord Mottistone, briefed by the CBI, who was most persistent in his efforts to mitigate the worst effects of the right to bring legal proceedings given under Clause 21 to individuals deprived of goods or services through unlawful action. We continue to fear that, in the highly charged atmosphere of major disputes,
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attempts to engage in vexatious legislation may make the speedy resolution of disputes by management and unions more difficult.
At least until today, the most contentious clause of all has, of course, been Clause 34 which abolishes wages councils. The Government have given no satisfactory explanation as to why they made no reference to the matter in their election manifesto last year. They have produced no convincing evidence in support of their view that wages councils destroy jobs. Moreover, they had no answer to the question posed by my noble friend Lord Russell as to how they could logically claim that they believe in a free market and yet, at the same time, allow wages to fall while the state, in effect, subsidises those wages through increased expenditure on social security benefit. At the end of the debate on that subject on Report, I was left with a clear impression that the Government had won the vote but had lost the argument.
I believe that the Bill is out of keeping with the feelings of the British electorate. The Government's obsession with so-called trade union reform may even have contributed a little to the treatment meted out to them in the Newbury by-election and the county council elections two weeks ago. If so, I can only hope that they will, belatedly, learn a lesson for the future. They do not seem to have learned it yet.
However, I should like to end on a more harmonious note. Strong views were expressed on both sides of the House during the passage of the Bill. But, throughout, I have admired the composure, the courtesy and the even-tempered way in which the noble Viscount, Lord Ullswater,(ably assisted by the noble Baroness, Lady Denton) steered the Bill through its various stages. I should also like to congratulate the noble Baroness, Lady Turner, the noble Lords, Lord McCarthy and Lord Wedderburn and, indeed, the noble Lord, Lord Mottistone, on the valuable contributions that they, too, made to the debates. This is a civilised place, and I am glad to be a Member of it.
Baroness David: My Lords, it is a matter of very great regret that Clauses 44 and 45 which deal with the careers services appear at the end of such a very long Bill and that the debates concerning them have taken place on each occasion very late at night when only a handful of noble Lords have been present. Yet the future of the careers service has attracted as much concern and interest among the many employer and education organisations as any other part of this long and important Bill. To all intents and purposes, the new legislation appears rather obscure and innocuous. But what is clear from it is that, during the next few years, the existing careers services throughout Britain —that is, about 120 of them—will be involved in an enormous upheaval.
In implementing the new legislation, it appears that the Government are committed to experimenting with a range of new and untried organisations in the provision of the new careers services. That being the case, Members on this side of the House would urge Ministers to undertake any such experiments with very great care.

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We fully accept that the world around us is changing fast and that there is a continual need to review all our systems and structures. Indeed, in a civilised society it is important that we do so. But as the legislation concerning the future of the careers service is implemented, we believe that there is a real possibility that things could go badly wrong. Far from seeing the raising of standards and high quality services everywhere—which the Government say they are seeking—we could so easily witness very much the opposite; for example, contracts being given to organisations without the skills, knowledge or professional background which are so vital to enable this important service to be effective.
Of course, the real losers in such a failed experiment would be the young people and others in the community needing to make use of the new services, not to mention the considerable consequences to the nation's economy at a time when improved standards are so badly needed in every quarter. We beg the Government not to throw the baby out with the bath water.
As has already been said in this House and elsewhere, no one has been able to tell us what is wrong with the current arrangements and why it is not possible simply to repair any deficiencies and build on the solid foundation which has been established over 20 years or more.
In 1990 there was a much publicised Employment Department review of careers services in Britain, generally referred to as "The Bruce Review". Mr. Bruce's report was never published. Its findings and recommendations were withheld from public view. But it is widely believed that Mr. Bruce was rather impressed by what he found. Certainly there appears no evidence to show that he, or for that matter the public at large, has any significant grounds for harsh criticism of careers service provision as it currently stands.
Since the publication in 1991 of the Government's White Paper, Education and Training for the 21st Century, which in Chapter 7 set out its plans for the future of the careers service, the majority of careers services in Britain have voluntarily formed useful and effective partnerships with their local Training and Enterprise Councils, taking themselves closer to employers exactly as suggested by the Government in the White Paper. Very many of them have made significant improvements to their operation as a result of this development. We would urge the Government to look more closely at these partnerships and give them time to establish themselves fully. It would seem sensible to build on their success.
Finally, I should like to say a few words about the staff of the existing careers services and the careers guidance profession itself. It is quite obvious to us all how positively they have responded to the central thrust of this Bill, in spite of the fact that their existing services as they have known them are under very great threat. I am glad that many noble Lords paid a tribute to them when we moved an amendment on the national council. Far from adopting an obstinate or negative stance, they accept that, amidst so much change in the worlds of education, training and
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employment, they must change too. Their professional association, the Institute of Careers Guidance, has sought to focus its attention on the importance of securing the highest quality of provision while seeking to protect the interests of the individual consumer, which Ministers must agree is to the institute's very great credit. It is, of course, what their plea for a national council, supported by all the major employer and educational organisations, is all about. From all sides of the House there has been encouragement to the Government to establish by statute this national council in order to ensure that in Britain we shall truly have a world class careers service. That call has not been heeded.
We cannot begin to understand why, with all the problems that the Government have acquired for themselves in recent times, they choose not to listen when the community—in this case both the employer and the education community—speaks with one voice. It is crucial that representatives of the business and education sectors at the highest levels have a full involvement in the development of the new careers services. And what a powerful motivating factor the establishment of a national council would be to the profession! There is, of course, still time to respond. I ask the Ministers yet again to think about a national council as that concept is popular in so many quarters, though not at the moment with them.
1.30 a.m.
Lord Stoddart of Swindon: My Lords, what has been quite remarkable about this Bill is that it has been considered during the day and in the long watches of the night. It has been examined in great detail and many amendments have been tabled. The Government have listened but they have taken no notice and as far as I can see, after all the work that has been done by my noble friends, the Government have accepted one small amendment.
In his opening remarks the noble Viscount, Lord Ullswater, quite properly paid tribute to my noble friend Lady Turner of Camden and to my noble friends Lord McCarthy and Lord Wedderburn. He also paid tribute to the noble Baroness, Lady Seear, and to the noble Lord, Lord Rochester, all of whom in their own way are experts on these matters of trade unions and labour relations. We have two academics, a full-time senior official and personnel directors. None has been listened to.
Wide experience and considerable expertise have been at the disposal of the Government throughout the consideration of the Bill. The Government came forward with the Bill and decided that they were right in everything they put forward. They ignored the experience that was available in this House. They failed to accept any reasonable amendment. That is shocking in a House which should pride itself on a certain amount of independence and real debate—not debate which has been finalised by severe whipping. I find it unfortunate and surprising that the expertise available has not been heeded.
I am a trade unionist of very long standing. I joined a trade union when I was 16, which is a long time ago. I have been involved in the trade union movement

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from that time onwards one way or another. Bearing in mind the work that the trade union movement has done over a long period, sometimes not very well and sometimes badly, but generally with the best will in the world and with the aim of assisting its members, it is a great pity that to a certain extent the Government have slandered the movement. They have certainly been vindictive in many senses, as the noble Lord, Lord Rochester, said.
What could the reason possibly be for insisting that trade unions, alone among all organisations, will be obliged under the Bill every three years to give authorisation to have subscriptions deducted from their members' wages? It is only a small point. But why on earth do the Government come forward with such a proposal unless it is vindictiveness or because they have some hidden motive? Why do the Government bring it forward in a Bill unless their design is to undermine the trade union movement?
I endorse everything that my noble friend Lady David said about the careers service. Here again is a case in point. Many ideas were put to the Government which would have improved upon what they themselves proposed. Again, there was no response. The Government were incapable of seeing that a great many people were trying to help. The ideas which came forward were rejected out of hand. It is very sad that when so much expertise has been available the Government have not seen fit to take advantage of it to improve the Bill.
Lord Wedderburn of Charlton: My Lords, I wish to make two points by way of postscript. I shall make no oration on seeing a Bill pass, which, in my view, is a very sad occasion. It is a Bill on which I hope another place will take a view in order to modify the two points which are wrong with it. At bottom the measure is a bad one. It is not even like a curate's egg. The good parts, when one finds them, are often defective. Although the Bill implements a number of Community instruments it is poor in its imagination. Authoritarian measures are frequently limited by a lack of imagination. The debate on the careers service illustrated that point.
Secondly, the Bill continues its attack upon workers' rights, their freedom of association, the autonomy of their organisations, and the organisation internally and externally in terms of membership and its defence of members against the employer in an action short of dismissal. As the noble Baroness, Lady Seear, said, freedom of association is so dented that it appears that the Government wish to do away with trade unions. It hardly needs to be said that that fundamental right to withdraw labour and withdraw employment on some reasonable terms is now connected with a web of such restriction that the withdrawal of funds will attempt to wipe it out.
There is a report that when in 1924 the Italian Carta di Lavoro was going through the government that then existed, somebody said, "It's not so much the authoritarian nature of the measure. The real defeat is in watching the authorities enact it without understanding just how authoritarian it is".
Baroness Turner of Camden: My Lords, before the Bill leaves this House, I should like to make a few comments.
When we debated the Bill at Second Reading, I said that it was a truly awful Bill and nothing that has happened since then in Committee or on Report has unfortunately changed my view. We have done our best from these Benches and with the support of noble Lords from other Benches to try to effect some amendment or to get the Government to change their mind. We have had little success on the main thrust of the Bill. I regret to say that, because the Bill which now leaves this House will do little to improve employment rights. On the contrary, many workers will find themselves worse off. In addition, their scope for collectively seeking improvements will have been disgracefully impaired by a Government who claim to offer choice but who do not do so unless one has enough money to make one's own choices anyway.
Further constraints have been imposed upon trade unions as though they were the main obstacles to employment protection rather than the reverse. The Bill's intention is to make it more difficult for unions to collect their subscriptions from members by imposing the requirement that check-off arrangements should be subjected to a three-yearly check. Quite clearly the Government's hope is that many employers will not wish to be bothered with this and will either refuse to embark upon such arrangements or will terminate agreements where they exist.
The Government not only wish to interfere with union cash flows, they also want unions to spend what money they have. They want unions to spend it on postal ballots even though it is acknowledged that workplace ballots have a higher participation rate. Those are no longer to be permitted. Instead much more costly postal ballots must be run and must be paid for wholly by the unions, since the arrangements whereby application may be made for public money are to be ended. Indeed, they are already being phased out. Therefore there will be no more public money for ballots about industrial disputes, for leadership elections, or on trade union mergers or amalgamations. In the latter case, just to make it as costly as possible, unions will not be able to include a recommendation with the ballot paper. They can make recommendations, of course, but in a separate envelope with separate stamps and, of course, at double the cost.
At Committee and on Report we have tried to make those provisions slightly less vindictively one sided, but unfortunately we have failed. I can only hope that, as often happens in human affairs, an unjust and inequitable policy will end up having the opposite effect from that intended. The Government plainly wish to marginalise the trade union movement. But the provisions about check-off will compel the unions to campaign for membership in a way that they may not have had to do before. That, combined with the effect of the Government's economic policies, may well result in unions emerging from this decade with rather more members and in a stronger position. I personally hope that that will be so.

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The new provisions about industrial disputes take the Government very close to outlawing dispute action altogether, as my noble friend Lord Wedderburn said. Yet, of course, the right to withdraw labour is upheld in all democratic states and is enshrined in ILO conventions which the UK Government have ratified.
One of the most objectionable features of the Bill which we have repeatedly tried to amend without success is that which requires the union to identify twice to an employer the members of his workforce who are likely to be involved in a dispute. Again, I question the necessity for that provision in the Bill.
As if that were not enough, we have the clause which provides a right for members of the public to sue in a so-called unlawful dispute and also which provides material assistance via a new commissioner to enable them to do so. The clause aroused much opposition not only among trade unions. The CBI and the Institute of Personnel Management do not like it either.
Again, perfectly reasonable amendments designed to ensure that individuals should have to demonstrate at least an entitlement to the goods or services affected by a dispute were rejected, as was the proposition that people claiming legal assistance under the clause would have to satisfy the same criteria as those seeking legal aid in other more normal cases.
The Government have made it clear throughout that their philosophy is basically an anti-collective one. They are against collective bargaining; they believe in individuals bargaining for themselves. The Government's idea of protection for workers is protection against the very organisations that they have created themselves and have voluntarily chosen to join. Hence, it is an employee's right in the Bill not to be told what his union recommends about a proposed merger with another union. It is an employee's right not to be allowed to have deductions from his salary for union subscriptions to be made on a continuous basis, although it is all right for charitable donations and welfare clubs. It is an employee's right in the Bill to be put in a position where his name could be notified to an employer, when all that is being done is that he is being supplied with a ballot paper in a potential dispute.
However, perhaps the clause in this Bill which until this afternoon gave rise to the most debate and, indeed, dismay, is the clause which abolishes wages councils. The House will know that this aroused opposition from Peers in all parts of the House. We have sought to remove the clause from the Bill and, failing that, have asked that there should be a review before abolition. Sadly, we failed. We shall thus have 2.5 million workers, often the most vulnerable and poorly paid, without any kind of wage protection at all. There will be nothing to prevent employers from cutting wage rates that are already too low. In times of high unemployment, people are prepared to work for sweat shop rates, without creating too much fuss about it.
However, in the end we shall all pay for it. We shall pay as taxpayers, since the low wage rates will require to be supported by the social security system for which
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we all pay as citizens. We shall pay because there will now be no incentive for such employers to improve production methods or to train, not while they have access to a pool of unskilled or semi-skilled labour, willing to work for peanuts. We shall pay morally, as a society, since it is not possible ultimately to create a caring society when the Government themselves encourage us, taking example from the legislation they promote, not to bother about those least able to look after themselves in an increasingly competitive and exploitative labour market place.
There were other aspects of the Bill which caused a great deal of debate. Many noble Lords were concerned about the proposals for the careers advisory service—rightly so. But again, the Government, as we have seen this evening, have not been willing to move at all in the direction of their well-informed critics who fear that what is intended will not produce an improved service but will open the way to wholesale privatisation of the service.
Finally, as if that were not enough, the Government have attempted this afternoon, at Third Reading, to introduce an amendment with far-reaching effects. It is true that we have had a Committee and Report stage on this vitally important new amendment, and we went through a process today which I think afforded very inadequate scrutiny of an important provision. Regrettably, we have not made any impression upon the Government's amendment.
Yet, as we have pointed out in discussion, the amendment—introduced simply because some employers want to induce people to give up the right to trade union representation, but find that they are hampered from so doing because of Section 146 of the 1992 Act—will have the effect of further isolating the UK from her EC neighbours. It is almost certainly a breach of ILO conventions, in my opinion, which specifically provide for freedom of association and the right not to be discriminated against in this way. It is a further demonstration (also in my opinion) of the Government's unremitting hostility to trade unions and the members whose interest they seek to protect.
The philosophy governing the Bill is clear. It is anti-collective. The Government want to individualise everything, even though most people who work for a living have little power on an individual basis and need the support of organisations they themselves have created. Fragmentation and individualisation of the workforce, exhortations and encouragement to employers not to recognise unions, or to cease to recognise them, all in my opinion have an underlying purpose; namely, to keep wage and salary rates as low as possible—unless of course the individuals concerned are one of the very small group of senior executives getting truly enormous salaries. The Prime Minister may express concern, but that does not seem to bother them very much.
I said at Second Reading that the Prime Minister, with his opposition to the social chapter and with this kind of legislation, is seeking to create "sweatshop Britain". In case some noble Lords may think that that is a bit strong, let me quote in support of my view from the Government's own publication intended to get investors to come to the UK. It is headed:

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"Workforce—one of the country's most valuable resources".
Under the heading "labour costs", it declares that these are among the lowest in Europe. It states:
"Wages and salaries are markedly lower than those in the US, Japan, or many other countries within the European Community; and so too are the add-on costs of social security and other benefits"
The publication later states:
"There is no legal requirement for a company in Britain to recognise a union. Many companies … do not do so.
"Throughout Britain as a whole the number and percentage of employees who are members of trade unions has been falling since 1979".
So there is a reason why we have this kind of legislation. The Government are out to attract inward investment, not on the basis of a trained and highly educated workforce arising from excellent training schemes and high-tech productivity, but on the basis of low pay, little employee protection and unions enmeshed in complex legislation, with no procedures for resolving disputes, no union recognition, and lots of unemployment; so if people are dissatisfied they just have to put up with it. It is not, as a previous Conservative Prime Minister recently remarked on the radio, something to be proud of. But that is the Britain of this Conservative Government and that is why we have this extremely awful Bill. I am very sad indeed that it is leaving this House so little amended.
Finally, if I may add a personal note, I am grateful to the Minister personally for his continuing courtesy on all occasions. We have sometimes had very bitter disputes about the provisions of this Bill. Nevertheless, his courtesy has continued unfailingly. He has been extremely courteous and kind on all the occasions when it has been necessary to discuss the Bill outside the House and in the Chamber, and for that I thank him. But I certainly cannot thank him for the Bill.
1.45 a.m.
Viscount Ullswater: My Lords, I said at Second Reading that this Bill would fulfil the Government's continuing commitment to ensure that we have an effective and up-to-date framework of law covering industrial relations and employment matters, and one which meets the needs of a modern economy.
The Bill that leaves this House is improved in many ways upon the Bill that I described in those terms. It will provide individual employees and trade union members with improved protections; it will give
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employers and the community important new rights; and it will greatly improve the operation of the labour market.
The noble Lord, Lord McCarthy, described it as "far-reaching", and of course that is right. It is far-reaching. In his own style of debating he sought to persuade us that the Bill is yet another son of Frankenstein. I am afraid that I am not so familiar with these young men as the noble Lord is, and I certainly do not recognise the Bill in that colourful language.
The noble Lord, Lord Rochester, made some constructive criticisms of the Bill, and I believe that we have listened to them very carefully. I know that he speaks from enduring concern about the relationships between employers and employees, and I know that he will pursue these matters in the same way in the future. I thank him for the generous remarks that he made concerning my noble friend and myself.
The noble Baroness, Lady David, and the noble Lords, Lord McCarthy and Lord Stoddart, expressed their concerns about the careers service. We are seeking the best service. I believe that the steps that we are taking with this Bill are the right steps.
The noble Lord, Lord Stoddart, said that the Government listened but took no notice. I have to disagree with the noble Lord. Yes, we have been helped greatly by the expertise that has been shown in all quarters of this House. I believe that we have listened to it.
The noble Baroness, Lady Turner, indicated that we sought to marginalise the trade unions. I do not believe that to be the case. However, I have to say that we are pursuing the freedom of the individual and individual choice. I thank the noble Baroness for her kind remarks to me personally.
The noble Lord, Lord Wedderburn, looking very mournful I think, said that this was a sad occasion. I have to ask him how that can be when the themes of the Bill are of central importance to the future economic growth of this country and the wellbeing of its citizens at work.
On Question, Bill passed, and returned to the Commons with amendments.

London Underground (Jubilee) Bill
The Queen's consent signified and Bill reported from the Unopposed Bill Committee with amendments.
House adjourned at nine minutes before two o'clock.