HL Deb 12 October 1994 vol 557 cc969-96

Consideration of amendments on Report resumed on Schedule 1.

[Amendment No. 16 not moved.]

Clause 4 [Convener and depute convener]:

Lord Fraser of Carmyllie moved Amendment No. 17: Page 3, line 26, at end insert ("provided that no such other council may, without the consent of the Secretary of State, decide that their convener shall be known by the title of "Lord Provost".").

The noble and learned Lord said: My Lords, I beg to move Amendment No. 17. Noble Lords may remember that when the question as to whether councils other than those of the four cities of Aberdeen, Dundee, Edinburgh and Glasgow should be able to call their convener by the title of Lord Provost was debated, I indicated that I should like to give further consideration to the matter. That I have done over the summer break. As I said in the previous debate, I am reluctant for this local government legislation to provide a complete veto mechanism for any such proposal. However, the tabled amendment which requires any councils other than those of the four cities mentioned to seek the consent of the Secretary of State seems to me to provide a reasonable compromise.

If, therefore, a council felt that it could prove historical title to use the term "Lord Provost", then that could be considered on its own merits. The possibility is not completely ruled out but would be a matter for the Secretary of State, in consultation with the Lord Lyon, if appropriate. Given the differences of views and the loyalties and traditions that were relied upon in the previous debate, I hope that this compromise will meet everyone's interests. I accordingly commend the amendment to the House.

Lord Hughes

My Lords, I find this a perfectly acceptable amendment. I cannot think of any of the proposed new authorities which could establish a claim to that of Lord Provost. There is one on the margin, which is Perth. Perth had a Lord Provost and in the hierarchy Perth's Lord Provost ranked immediately after Edinburgh. However, the situation changed because at that time Perth was a city on its own and was apart from the county of Perth and Kinross. In the proposed new set-up, the county of Perth and Kinross is reinstated and the city of Perth as such does not exist. However, I have no doubt that it could be one of the matters which might possibly be considered.

I am also told that at one time Elgin claimed to have a Lord Provost. I understand that that was based on no stronger ground than that on one occasion when Queen Victoria had been there she referred to the civic head as "my Lord Provost". They then said, "Very well, she has conferred a title on us". It is on no stronger ground than that. What has been suggested is a good answer, although it may well place the Secretary of State in the rotten position of having to decide, if somebody does claim, and perhaps having to say: "I am not convinced that you have a claim to it"'. This is one case where I am quite happy that the Secretary of State is taking this onerous responsibility upon himself.

Lord Carmichael of Kelvingrove

My Lords, I wonder if I may intervene in these debate between the ex-Lord Provost and the Minister in the Scottish Office. Perhaps he can help us with a definition of what a Lord Provost is. When I was much younger I always understood that a provost only became a Lord Provost if the area had a cathedral. One of the points that always worried me was why Dunblane did not have a Lord Provost because it has a cathedral that is rather larger than those in some of the cities in Scotland. Is there another definition? The question of what a Lord Provost is has always concerned me. I would be happy if the noble and learned Lord could enlighten me and give me any idea of whether there is a definition or whether the matter is purely dependent upon the Secretary of State giving his permission.

Lord Hughes

My Lords, perhaps I might intervene. I think that my noble friend has things slightly mixed up. It was not that those places that had a cathedral could claim the right to have a Lord Provost. They claimed to have the right to call themselves a city. That is why to this day you see the city of Dunblane.

Lord Ewing of Kirkford

My Lords, before we move on perhaps I might tell the Minister the story of the local milkman who, after taking a good drink, was driving his horse and cart and asked a local chap to look after his horse. The chap said to him: "Do you know who I am? I am the Lord Provost". The milkman said: "I can trust you with my horse, can't I?".

Lord Hughes

Was it in Dundee?

The Earl of Perth

My Lords, having heard the noble Lord, Lord Hughes mention that one possible exception in the future might be the city of Perth, I feel very happy to rise and say that I am totally behind this amendment. Things change. You cannot foresee what will happen in five or 10 years. In earlier consideration of this position there was a suggestion that the four should be there for all time and nothing could ever change that. It was a sort of graven-in-stone monopoly. I therefore welcome the amendment that is proposed by the noble and learned Lord, Lord Fraser of Carmyllie. I had hoped that he would come up with the solutions that he has produced.

Lord Fraser of Carmyllie

My Lords, I am most grateful to those noble Lords who have contributed to this debate and for the welcome that they have given to the amendment. I hope that the noble Lord, Lord Carmichael will not ask for a further explanation from me. A more than adequate one has been provided by the noble Lord, Lord Hughes. I leave the noble Lord, Lord Ewing, to look after his own horses.

On Question, amendment agreed to.

Clause 5 [Elections and term of office of councillors]:

[Amendment No. 18 not moved.]

The Earl of Minto moved Amendment No. 19: Page 3, line 38, leave out ("third") and insert ("fourth").

The noble Earl said: My Lords, I spoke to this amendment in Committee. It is a matter about which I feel very strongly on behalf of the local authorities of Scotland as well as on my own behalf.

I am in a bit of a quandary because everything that can be said on this particular amendment was said in Committee. I do not feel that it would be right to rehearse the whole issue again. But there are certain elements attached to the amendment which I feel I should pursue.

At present local authorities in Scotland have a four-year tenure of office. The suggestion that it should be three years is not in the best interests of local government for the following simple reasons. In a three-year period, in the first year following an election no local authority has its own policies or its own budget. In the second year following an election it has the opportunity to fulfil its promises to the electorate by producing its policies and establishing its budget.

If there are only three years in a term of office, during the third year—as is now the case, in the fourth—the councils and the elected members on those councils turn their attentions, I would suggest almost naturally, towards the elections that they have to face at the conclusion of that financial year. That therefore means than in a three-year term of office the only year in which it will be possible for elected councillors in the new councils, as proposed within this Bill, to fulfil the pledges that they make to their electorate is the second year. That is my fundamental concern.

I have to tell the House that I received a very kind letter from the noble and learned Lord a few days ago. His explanation was that, In the light of all the evidence

—following the internal management of all local authorities in Scotland— we concluded that there should be whole council elections every 3 years".

Indeed, I received an identical response from his right honourable friend in another place the Secretary of State for Scotland in answer to a letter that I wrote to him on this subject. I may say that it is the only letter that I wrote to the Secretary of State following the conclusion at Committee stage and the only item that I raised within that letter, as I considered it to be a matter of enormous importance in the local authority field.

If we are to have new councils, they should be given the opportunity to fulfil their mandates. Councils should not be placed in a situation of standing in front of the electorate and making promises that they simply cannot fulfil.

On the question as to whether all the evidence is totally factual, I somehow have my doubts. In local government we are united on this matter. There is no division of thinking. We are the people—among others, admittedly—who are expected to respond to the consultation paper to which I have referred. It was a position which has been held in a response to the same consultation paper on the internal management of local authorities in Scotland. It was the same opinion exactly that was held by the Society of Local Authority Chief Executives and the Society of Directors of Administration in Scotland. There are not two more powerful professional bodies in Scotland with regard to the administration and provision of services. So the local authorities, the Convention of Scottish Local Authorities, SODA and SOLACE, were united in their opposition to the three-year term of office. I believe that they had every justification to be so.

This is not a political issue. It is an issue that will determine the democratic process of local government in Scotland for many years to come. It is not a political issue. It is a straight question of practicalities. It concerns the administrative ability of councillors and their officers to fulfil the function for which they will be elected or appointed.

It is difficult to understand the argument that everything went well before 1975 on the basis that the term of office was then three years. The three years before 1975 were rolling years. The councils were county councils, borough councils and urban district councils, all of which (I say with the greatest respect to them) had responsibilities which were far less than the responsibilities that will be put into the hands of the new councils or indeed the responsibilities which, following the last re-organisation of local government, were put into the hands of the councils that make up the present regional and district authorities; and they were given four years.

So what reason caused the three-year rolling programme to be made into four years? The argument has been put forward that there is an election every two years. After two years for the district and two years later the region; two years after that the district and two years after that the region. But both those councils are monitored by their electorate and are elected for functions and duties which are totally different one from the other. If three years is so very important to Her Majesty's Government with regard to local government—as it appears to be—I must ask whether Her Majesty's Government would recommend that three years be the tenure of office for central government following a general election. Five years is considered to be the limit, albeit there are occasions when the period is shorter.

Then those bodies with whom local authorities will work must be taken into consideration. I found it extremely interesting in the past few weeks to have received a letter informing me that it was the decision of the Secretary of State for Scotland that the new water boards were to have a tenure of office of four years. Who will the members of the water boards be? We do not yet know whether they will be completely or in part local councillors; but we know that there will be a very close association between the local authorities and the water boards. So why, on the one hand, are the water boards to be given four years and, on the other hand, local authorities with their vastly wide responsibilities and remits are to be allowed only three years, in which only one year—the central year—is the year in which their policies will be undiluted and not impinged upon by the pressures of coining elections.

To me it is incomprehensible that for a matter which is so totally divorced from politics it should come to a confrontation. It is a simple matter to understand the rights and wrongs of this issue. With the very greatest respect to the noble and learned Lord, I believe that the Government have taken the wrong decision. It is as simple as that. For the reasons that I have stated at this time, I beg to move.

9 p.m.

Lord Mackie of Benshie

My Lords, I totally agree that four years is a reasonable term but not entirely for the reasons put forward by the noble Earl, Lord Minto. I believe that people can take office after an election and start immediately to think about their programme. I do not believe that when they are going out of office, they necessarily only think of getting back into office, so that there are only two years or a year in between in which they are able to think in terms of the good that they can do or their programme.

It is a simple question about time. I believe that four years is a reasonable time and we should stick to that. Three years is a little short. I cannot accept that for one year one thinks of the past, for one year one is free to apply the programme and for one year one is thinking of the next election. I feel that four years is a very reasonable time.

Lord Ewing of Kirkford

My Lords, with great respect to my noble friend Lord Mackie of Benshie—if I may call him such—I believe that there are much more substantial reasons for supporting the amendment which was so ably moved by the noble Earl, Lord Minto. The initial elections in April of next year are for a four-year term. The Minister will have to answer the question of how the initial elections in April of next year are for a four-year term and then in 1999 that term will be reduced to three years. What is the logic of having initial elections for four years and subsequent elections for three years only?

The Minister will also have to answer the noble Earl, Lord Minto, in relation to the fact that health boards and various other quangos—indeed, I suspect also the quangos to be set up under the legislation we are discussing—will be appointed for a four-year term. It seems absolutely outrageous that we should be saying that democratically elected councillors will be elected for only a three-year term but those who are appointed by the Secretary of State will be appointed for a four-year term. There is a host of reasons why the term for the new councils should be four years and not three as suggested in the legislation.

The Minister may well come back and say, as he has said before, that before the reorganisation of local government in 1973–74 the term of office for councillors was three years. But, as the noble Earl, Lord Minto, pointed out, that related to only a third of the councillors. In those days one-third of the councillors retired every three years and therefore there was a rolling programme of elections.

We then come to the question of voter fatigue. Parliament is elected for five years and 17 days. It is not generally appreciated that Parliament can exist for 17 clear days, not including Saturdays and Sundays, after the date of a general election. The European Parliament is elected for a fixed period—a much longer period than we are discussing for local government.

If the new councils are to put together cohesive strategies they need a period that exceeds three years. The Bill talks of three years, but we are really talking about two years and nine months because in the last three months of that period no decisions will be taken; politicians of all parties—including, if I may say so, the Liberal Democrats —will be postulating political decisions in anticipation of the coming elections and there will be no cohesion in delivery of services. There is therefore an overwhelming argument as to why the Government should accept the four-year period of office rather than the three years. It would be nothing like a major climbdown for the Government, and I hope that the Minister will be sensible enough to rise in his place to say that they will accept the amendment so ably moved by the noble Earl, Lord Minto.

Baroness Carnegy of Lour

My Lords, perhaps I may say briefly to the noble Lord, Lord Ewing, that the four years in the first term is exactly what it was in 1974. The first year is a shadow year and the following three years are in action. Last time it was the first four years followed by a four-year gap between elections. That was different. But the first year is a shadow year and I should have thought that that was the reason for the decision.

I should like to say to my noble and learned friend that it would be a good idea for him to look at the matter again. Taken not only from the point of view of councillors or other quangos but from the point of view of the electorate it is important. The electorate either needs a more frequent opportunity to vote on the councils or it needs a longer period to see whether the council will carry out its manifesto. It is an advantage to the electorate to have the longer period in modern times. From that point of view therefore I favour the four-year term.

It is not a major issue and the politicians—the elected people in another place—should probably be the ones to decide. If the House divides upon the amendment I shall not vote for it at this stage. But I hope my noble and learned friend will look at the matter again.

Lord Sanderson of Bowden

My Lords, I hope that my noble and learned friend on the Front Bench will take the matter away and consider it. A good case was made by the noble Earl, Lord Minto, at both Committee stage and today. Perhaps the logic of the argument can be looked at by my noble and learned friend before the next stage of the Bill.

The Earl of Perth

My Lords, I ask the. Minister to think again. Three years is a very short time for these councils because they do not get into their swing in the first year for the reasons which we have heard from the noble Earl, Lord Minto. The point made by the noble Baroness, Lady Carnegy, is a good one; namely, that the likelihood of carrying out the programme is that much better if it is for four years rather than three.

9.15 p.m.

Lord Fraser of Carmyllie

My Lords, I have listened again with interest to the way in which the noble Earl has presented his argument, not only with great eloquence but also with great force in favour of a period of four years. My position and also that of the Government on this is that we do not believe this is a matter of absolutes. There is no absolutely right answer as regards three years any more than we believe it is absolutely wrong to go to four years. As he indicated, according to the terms of the letter which I sent to him, our decision in favour of elections every three years was influenced by the fact that prior to the last reform of local government the period in Scotland had traditionally been three years.

As a Unionist in the context of this Parliament, I recognise that the tradition elsewhere in local government in the United Kingdom has been for a different period although there have been other differences in the way in which elections have been held. We were strongly inclined to go for a period of three years. Having been a Member of another place, that was a matter which was considered there and voted on when the period of three years was settled.

I do not believe that there is anything absolutely right or wrong about three years or four years. I say to the noble Earl that I have greater confidence in a new authority than he appears to have. I believe that it is capable of getting on with its programme more quickly. But he has long experience in local government. I must reflect on the mood of the House not least as regards the Opposition Front Bench and that of my noble friends who have also contributed to this debate.

On that basis, I shall be grateful if the noble Earl will withdraw his amendment. As he will appreciate, I cannot give him an undertaking that I shall necessarily return to this matter at Third Reading and agree with him. Arguments have been very carefully and fully developed in the course of this short debate and they are such that both the Secretary of State and his Minister for local government and myself should reflect on those contributions. Without wanting to burden the Third Reading, this is a matter within a very narrow ambit which we can properly return to at that stage.

Lord Hughes

My Lords, can the Minister explain the point which the noble Earl, Lord Minto, raised about the water boards being given a four-year term?

Lord Fraser of Carmyllie

My Lords, that is one of the aspects of the matter which I wish to reflect on. I freely acknowledge that as regards health boards in Scotland the anticipated period would normally be four years. It is not singularly or exclusively a four-year period because sometimes it is one, two or three years. It is in that context that it is appropriate that, instead of dealing with the matter any further in a comparatively thin House, I reflect on it and return to it at Third Reading. Of course, I am in the hands of your Lordships.

Lord Hughes

My Lords, a councillor on the board when his term of three years expires ceases to be a member of the water board for that last year. He would have to wait for at least another year before he can again become a member of the water board.

Lord Ewing of Kirkford

My Lords, I do not know what the noble Earl, Lord Minto, is going to do in response to the Minister's reply to the debate. I should like a much more firm assurance from the Minister. The House has argued strongly that we should have a four-year term—

Baroness Carnegy of Lour

My Lords, on a point of order. We are at Report stage. The noble Earl moved the amendment and we do not have the right to intervene in this way. I think that the House will agree with me.

Lord Ewing of Kirkford

My Lords, further to the point of order, I accept the strictures of the noble Baroness, Lady Carnegy of Lour, which demonstrate clearly her fear that the Government may well be defeated if we press this matter to a vote.

The Earl of Minto

My Lords, I am grateful to noble Lords who have supported me in this amendment. However, I must advise the noble Lord, Lord Mackie of Benshie, that I do not follow his argument. Perhaps on this occasion he will accept that 20 years' experience of local government gives one some reason to speak with authority.

The noble and learned Lord said that he has confidence in the new councils. So do I. I want to give them the opportunity of carrying out their duties in the best possible way and I want to see the people they represent given the best possible representation.

I listened carefully to what the noble and learned Lord said. He will not give me a guarantee that he will come back with anything different on Third Reading, but he is going some way towards that. I feel very badly about this, but I believe that this is a fundamental, which he does not. In view of that, on this occasion I must seek to divide the House.

9.20 p.m.

On Question, Whether the said amendment (No. 19) shall be agreed to?

Their Lordships divided: Contents, 29; Not-Contents, 43.

Division No.4
Airedale, L. Hamwee, B.
Carmichael of Kelvingrove, L. Hughes, L.
Carter, L. Kilbracken, L.
Darcy (de Knayth), B. Kinloss, Ly.
Dean of Beswick, L. Kirkhill, L.
Dundee, E. Macaulay of Bragar, L.
Dunrossil, V. Mackie of Benshie, L.
Ewing of Kirkford, L. Mallalieu, B.
Falkland, V. Mar and Kellie, E.
Graham of Edmonton, L. McNair, L.
[Teller.] Minto, E.
Monkswell, L. Taylor of Blackburn, L.
Palmer, L. Thomson of Monifieth, L.
Perth, E. Thurso, V.
Stoddart of Swindon, L. Tordoff, L. [Teller.]
Arran, E. [Teller.] Hooper, B.
Attlee, E. Howe, E.
Balfour, E. Inglewood, L.
Blatch, B. Lawrence, L.
Brougham and Vaux, L. Lucas of Chilworth, L.
Bruntisfield, L. Lucas, L.
Chalker of Wallasey, B. Lyell, L.
Courtown, E. Mackay of Ardbreckmsh, L.
Craigmyle, L. Mersey, V.
Nickson, L.
Cranbome, V. [Lord Privy Seal]
Northesk, E.
Cumberlege, B. Reay, L.
Demon of Wakefield, B. Rodger of Earlsferry, L.
Dixon-Smith, L. Saltoun of Abernethy, Ly.
Faithfull, B. Selborne, E.
Ferrers, E. Skelmersdale, L.
Fraser of Carmyllie.L. Stodart of Leaston, L.
Gisborough, L. Strange, B.
Goschen, V. Strathclyde, L. [Teller.]
Harmar-Nicholls, L. Teviot, L.
Henley, L. Trumpington, B.
HolmPatrick, L. Ullswater, V.

Resolved in the negative, and amendment disagreed to accordingly.

9.29 p.m.

Lord Carmichael of Kelvingrove moved Amendment No. 20: After Clause 5, insert the following new clause:

("Declaration of paid employment in Local Authority

—(I) The Local Government (Scotland) Act 1973 shall be amended as follows.

(2) In section 31, leave out paragraph (1) (a).

(3) At the end of section 31 there shall be inserted the following new section

"Declaration of paid employment in Local Authority.

31 A.—(1) Subject to subsection (2) below, a person who holds paid office or employment in a local authority may be nominated as a candidate or serve as a member of that local authority.

(2) A person elected as a member of a local authority who is also in the paid employment of that authority (other than the office of chairman), shall declare his interest as an employee in writing to the returning officer upon election and shall not serve on any committee of the local authority which has responsibility for the department, section or organisation for which the member works." ").

The noble Lord said: My Lords, the amendment tries to establish for local government officers the right still to play a part in local government. The planned move away from the present two-tier structure will debar 280,000 local government employees from holding public office, since Regional Council employees currently possess the right to stand for public office in district councils and vice versa. Potentially, 280,000 employees, who may have varying views across the political spectrum, will automatically be debarred from standing for office in local government elections. In fact, 10 per cent. of the Scottish electorate would be banned from making effective contributions to the work of the local council because of the planned changes and that has severe implications for their civil rights.

I understand that a representative of one of the unions for local council employees has been involved in discussions with the Scottish Council for Civil Liberties. The conclusion is that the effect of the proposals in the Bill would be that the Government of the United Kingdom would be in breach of their obligations under Article 25 of the United Nations Covenant on Civil and Political Rights. I know that the noble and learned Lord the Lord Advocate is in tune with what is happening in the European Court and that he also receives much the same briefs as are given to us. Will the noble and learned Lord, Lord Fraser of Carmyllie, clear up the difficult issue of 10 per cent. of the population of Scotland being unable to be elected as councillors in their areas? I beg to move.

The Earl of Balfour

My Lords, I do not believe that, upon being elected to a council, any employee should be put in the impossible position of being able to criticise a senior officer of that council through the elected council's meetings. It is purely as a result of the embarrassment that might be created that employees of a council must not be elected members of that council. It is on that point that I object to Amendments Nos. 20 and 77.

Lord Stoddart of Swindon

My Lords, I declare my interest as an adviser to UNISON, which is a major local government union. I support my noble friend in his Amendment No. 20. We had a long discussion in Committee and I do not wish to repeat those arguments. However, I wish to emphasise that the reason why 280,000 people are being disfranchised is because of the Bill and the Government's action. Undoubtedly, if something is not done to re-enfranchise those people who are disfranchised under the Bill as it now stands, the available source for councillors will be depleted.

I appreciate the difficulties, as I said in Committee. However, this amendment seeks to help and is perhaps a way forward. I wish to emphasise that a person employed by a local authority will, when nominated, make a declaration. Therefore, the electorate will know exactly who they are electing and that the candidate has an interest. If, in those circumstances, the electorate decide that he should be elected, he will be properly elected and those electing him will know all the circumstances.

This is an attempt to meet the difficulties that were raised in Committee. I feel that the Government should give consideration to this matter. As I explained in Committee, people who are employed by local authorities are already sitting on boards and making decisions quite often in relation to their employment. Presumably the chairmen and members of the boards of the new water authorities which are to be set up under the Bill will be making decisions which affect their lives. Therefore it is not as odd as it seems that we should be proposing in this amendment that local authority employees who hitherto had the opportunity to serve their fellows should continue to be able to do so under the Bill. I hope that consideration will be given to this amendment because it provides a way out of a difficult situation.

Viscount Dunrossil

My Lords, I wish to raise a small point in relation to this matter. In North Uist in the Western Isles during the local elections in April a lady who lives very close to me was elected to the Western Isles council. Very shortly afterwards everyone found to their embarrassment that in responding to an earlier call from the council for emergency assistance for home help work she had been employed by the council and therefore, having been declared elected, she was promptly declared not elected. Perhaps the Government can give further thought to the matter. I am by no means sure that the proposed amendment, which is much broader and wider in scope than the little incident I have talked about, is what the Western Isles council is looking for. However, I know that it felt acutely embarrassed. It would be right if it were not in a position whereby the doubt and mechanics of the present situation could cause a lack of respect for democratic processes throughout the island. In the case to which I referred the Western Isles council and the whole democratic process were the subject of disrespectful giggling, which is not a happy state of affairs.

It is also discouraging to the very small number of people who are prepared to come forward, whether for three years or four years, for election to councils. This is a difficult point because in a relatively low cash economy such as the Western Isles so many people are inevitably employed by government or by the local administration. That means that by the existing state of affairs one is blocking out many people who have an orientation towards public service. It would be nice if the Government could give the matter further thought, perhaps not necessarily in the form of this amendment, and find a way of making it easier for people to seek compatibility between public service at a paid level, albeit perhaps at a lowly level, and being eligible for election.

I am sorry if I have not made myself clear, but I am not a constitutional expert. However, I believe that further consideration is necessary. Therefore, I support the spirit of the amendment without being entirely sure about its total effect.

Lord Fraser of Carmyllie

My Lords, the matter before us requires careful consideration. Indeed, over the years it has received such consideration. There have been many inquiries and investigations not only in Scotland but also on this side of the Border because it is a problem which would apply with equal force here.

I believe that it might be interesting to look, first, at the report of the Montgomery Committee of 1984 which considered the issue specifically in the context of the Islands councils. It is appropriate because island councils in Scotland are single-tier authorities. The committee was firmly against chipping away at what it considered to be an intractable problem by not permitting employees to be members of committees relating to their own area of work. The committee said: We agree with the conclusions consistently arrived at by previous enquiries, which have gone into the arguments with great thoroughness, and decided against allowing council employees to stand for election. In particular, it is our view that an employee's interest goes much wider than the confines of his own area of work: decisions on other council functions could have repercussions for his own position, while decisions on broader policy issues might directly affect any employee councillor". Following on from that, and more recently, the Government considered the issue of eligibility in the context of the review of the Internal Management of Local Authorities in Scotland. A public consultation paper was issued in March of last year which set out the arguments both for and against altering the present position. The Government received a substantial number of well-researched responses, mainly from local authorities and other local government organisations. Those responses served to highlight the sharp divisions that exist on the issue both generally and within local government. We did not approach that consultation from any fixed position. What we wanted to do was to establish the case for change and, if that was accomplished, to establish what form any relaxations might take. We paid particular attention to the responses from local government.

For just the kind of reasons outlined by the noble Viscount, there have been reservations about the numbers of people who in any particular area might be affected if the existing rules remained unchanged. However, despite that concern, the clear message was that there existed an inherent conflict of interest which could not be readily overcome. Some of the responses pointed out that there could be considerable problems in respect of the relationship that a councillor/employee might have with his employing authority or his manager.

Leaving aside the general principle of eligibility, if the amendment were accepted it could give rise to what we would see as a number of irreconcilable problems. For example, there might be the case of a council which decides to forgo a traditional committee structure. The council's preferred model might be a single committee structure—that is, the whole council. A variation on that theme might be a structure of perhaps only three or four committees each with oversight of a range of individual services. Indeed, there was a recent interesting suggestion in a newspaper article stating that Shetland Islands Council want to change things. However, I do not know whether or not that is correct. In the context of the decentralisation theme that I have been pressing during the course of this Report stage, an area committee might be given a range of responsibilities in respect of a particular area.

It is not just a matter of the councillor participating in a particular committee which is within his area. For example, what we must be concerned about is the possibility that such a councillor might be a social worker. If his constituents came to him stating that they had a social work problem he would have to say, "I am sorry, I understand your problem but I regret to say that I can't take it up on your behalf because that is an area of local government activity in which, as a councillor, I am excluded from participation".

There are serious difficulties here and I am bound to say that I believe that they concern issues of the constitution. Employees have never had the right to stand for election to their employing council. I am bound to say, notwithstanding the concerns—I recognise those concerns—that a number of people are excluded, we do not see that there is an overriding case for change. This approach is in line with the findings of several previous inquiries and with the rules that apply in England and Wales. It is also consistent with the long-standing rules which prevent serving civil servants from standing for election as Members of Parliament. Perhaps, most importantly, it is in line with the strong evidence from local authority interests themselves in favour of the status quo. For those reasons, which are not in any sense party political but which I believe concern some fundamental constitutional principles, I suggest to the noble Lord that he might withdraw his amendment.

9.45 p.m.

Lord Macaulay of Bragar

My Lords, before the Minister sits down—he has now sat down—may I ask—

Noble Lords

Say you did not see him sit down!

Lord Macaulay of Bragar

My Lords, I am told I must say I did not see the Minister sit down. Does the Minister recognise that in the Western Isles, the Outer Isles and indeed the Northern Isles one is dealing with a different community which perhaps people on the mainland of Scotland do not understand? People within these communities, to which I am proud to belong, want to participate in the governing of their community. This amendment is designed to make sure that they are given the right to participate in local democracy. The Government's rejection of this constitutes a statement to the people of the Western Isles who want to work in a local authority that if they take a job in a local authority they cannot stand for election. That seems to be a negation of democracy. Perhaps the Minister will wish to respond to that point.

Lord Fraser of Carmyllie

My Lords, I thought I had made it perfectly clear that I readily understand the desire of people to stand to be councillors in authorities in which they might be employees, but I should have thought that as a distinguished member of the Scottish Bar the noble Lord might like to reflect upon the fact that there are issues here as regards whether employees should also, as it were, become the people who run and have the responsibility for a council. As I indicated, inquiry after inquiry has reached exactly the same conclusion. The Montgomery Committee, which considered specifically just the communities to which the noble Lord makes reference, came to that conclusion. Local authority interests have recognised that there are inherent difficulties, which seem to me intractable, in terms of the conflict of interest. It is for that reason that I urge the House to take the view that the existing rules, which apply elsewhere in the United Kingdom, should be maintained in Scotland.

Lord Ewing of Kirkford

My Lords, before we come to a conclusion on this debate, I should say that I realise the noble Baroness, Lady Carnegy, is becoming a little impatient. Perhaps I may explain to her the reason for the previous vote that took place. It will not be until 1999 that the three-year term will apply and there will be a Labour Government by that time and we will introduce a four-year term.

However, I turn to the issue that we are debating at the present time. When the Minister refers to the Montgomery inquiry he fails to take account of the services which—this was encouraged by the Government—had been contracted out by local authorities. I take the example of Stirling District Council which contracted out its legal services; those services are no longer carried out in-house. The irony is that an employee of Stirling District Council cannot stand as a candidate for election. (Is the Minister listening or is he listening to the Whip?) As I said, the irony is that an employee of Stirling District Council cannot stand for election to Stirling District Council but an employee of the company to whom the services of Stirling District Council have been contracted out can stand as a candidate. The noble and learned Lord the Lord Advocate is nodding in agreement I find that astonishing. It is acceptable for an employee of a company providing contracted out services to stand for election to Stirling District Council and influence the policies of that district council in favour of the company which employs that person, but it is not acceptable for an employee of the council to stand for election. Where is the justice in that approach? The Montgomery inquiry has nothing to do with the discussion we are now having. I do not see us dividing on the issue, but I advise the Minister to have another look at the matter.

There is another point concerning Clackmannan. I am glad that the noble Earl, Lord Mar and Kellie, is in his place.

The Earl of Perth

My Lords, the noble Lord is totally out of order. The noble Baroness, Lady Carnegy, drew attention to the matter earlier. It appeared to make no difference. After the Minister has spoken we have to leave it at that.

The Earl of Arran

My Lords, I should like to make it clear that we are at Report stage. The noble Earl, Lord Perth, is correct. The Minister has spoken. The only person who has leave to speak after the Minister on points of clarification is the mover of the amendment. To do other than that would be out of order with the current Standing Orders.

Lord Ewing of Kirkford

My Lords, in accordance with my usual custom, I apologise to your Lordships' House.

Lord Carmichael of Kelvingrove

My Lords, I have one or two small points to make. First, I should have mentioned the fact that Amendment No. 77 was taken with Amendment No. 20, since the two amendments were grouped together.

I recognise the problems. I have had a long connection with local government, although only a brief personal association as I came to Parliament a year after I was elected to local government. It always annoyed me greatly that a lawyer who specialised in planning— and we all know how explosive that subject was in local government—could be a councillor in a local authority. He might declare his interest, but there were many ways in which he could make his influence felt long before a vote was taken. Another obvious example relates to licensing laws. Although certain improvements have been made, licensing was a strong source of dubious decision-making in many local authorities in Scotland for a long time. I can see the two learned lawyers nodding their heads. They have been aware of the problem for a long time.

There were also problems with builders. A councillor who was a builder did not necessarily speak for his own firm, but someone else might speak for that firm. The trade in Glasgow was at least as influential as the Scottish Trades Union Congress in Glasgow. Therefore, I worry about the matter.

The example which the noble Viscount, Lord Dunrossil, gave pointed to the sheer stupidity of the matter. I believe that we should be looking at the matter in a positive way. Instead of identifying the difficulties we should be asking how we get over those difficulties. The examples that I have given show that it is possible to have great influence in a council. A councillor may declare an interest and not take part in a vote and then go to the tearoom or bar and use his influence there. We are all men of the world—at least all Edinburgh advocates are certainly men of the world. They will know what I mean.

I shall not press the amendment to a vote, but I hope that if the matter arises again in the future some positive arguments will be forthcoming to overcome the obvious difficulties. I accept that there are difficulties, but if these rules are to apply to council employees they should be hardened up in relation to other employees. Then we would be left with very few people who would be eligible to stand for election to local authorities.

In the meantime I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 2 [Establishment of new local authorities]:

The Earl of Dundee moved Amendment No. 21: Page 130, line 39, after ("wards") insert (", the boundaries of which, where possible, correspond to the boundaries of the wards for district council elections as at 7th May 1992 and").

The noble Earl said: My Lords, the purpose of the amendment is to draw attention to the strong opposition in Scotland to the plan for reducing the level of local government representation. Reductions in the number of electoral wards have been proposed. As a result, efficient representation by councillors will become much more difficult than it is and in particular in Highland, Fife, Borders, Dumfries and Galloway. Indeed in those parts of Scotland, and arising from Schedule 2 and Clause 23 of the Bill, when taken together, it is perceived by many that there are now two parallel problems threatening local communities: first, under-representation by councillors; and, secondly, from the present drafting of Clause 23, of insufficient decentralisation by the new unitary authorities.

On the question of under-representation, and of all four areas mentioned, Fife will be worst affected. If my right honourable friend the Secretary of State were to decide upon 46 seats in Fife, it would mean a ratio of one councillor to approximately 7,500 people. That ratio puts an area of significant rural population on a par with the dense urban population of Glasgow and Edinburgh. In Highland, Dumfries, Galloway and Borders, the proposed reduction would also create some very large wards. Clearly that would weaken links between councillors and local communities.

A useful comparison may be made with Wales where the ratio of councillor to electorate is far lower. In the new Welsh council to be composed of Dwyfor, Arfon and Meirionnydd, the ratio is one councillor to roughly 1,400 population, compared with the new proposed Scottish average of one councillor to approximately 4,000 population.

There is then the worry that owing to those changes Scottish councillors themselves will have far too much work to do. That in turn makes it far harder for those who are in full time employment or who have family commitments to stand for election. As a result, there would clearly be a narrower choice of potential councillors.

There is, too, the adverse connection between reduced councillor numbers and the theme of decentralisation which we shall discuss in Clause 23. If decentralisation were to be carried out properly—that is, decentralisation of the decision-making apparatus and not just of services—there would have to be enough councillors to make the option of setting up area committees and such structures practicable. Paragraph 2 of Schedule 2 does not deal with individual councils. Consultation is still under way with local authorities over the number of electoral wards for the new councils in their areas. It is understood that next week my right honourable friend the Secretary of State will give guidance on the matter. However, in view of that procedure and in advance of that statement, I should be grateful if the Minister could pass on the concerns which I believe to be held on all sides of the House. I beg to move.

10 p.m.

Lord Ewing of Kirkford

My Lords, perhaps I may take the advice of the noble Earl, Lord Perth, and intervene before the Minister speaks. As an apprentice in your Lordships' House, learning the procedure as I go along, I am grateful to the noble Earl for passing on the benefit of his long experience in your Lordships' House.

I know what the Minister will say in response to the amendment: the proposals are out for discussion. However, if the consideration given to the drafting of the Bill is anything to go by, then I have to say in all honesty that my deep suspicion is that nothing will change as a result of the consultation that will take place between now and the Government laying the parliamentary orders that implement the proposals for the number of councillors.

Perhaps I may concentrate for a few minutes on Fife because I know that it is the basis of the amendment of the noble Earl, Lord Dundee. It is absolutely outrageous to suggest that Fife should have only 46 councillors to represent the electorate. I said earlier today that it has now been decided that Central Region will have three local authorities. In that region there will be 70-plus councillors representing a population—not an electorate —of 250,000. In Fife, if the Government's proposals are implemented, there will be only 46 councillors representing a population—not an electorate—of over 300,000.

It is absolutely outrageous that the Government should suggest that the boundaries for the initial elections in April 1995 should be the regional council boundaries in Fife. The Minister knows that full well. Throughout the debates I have hesitated to quote to him something which Allan Stewart said, because I know that nothing hurts him more than to be burdened with the words of his colleague the Minister in another place. Mr. Stewart gave a specific undertaking at Report stage of the Bill in another place that the district council boundaries would be used for the initial elections and the local government boundary commission would draw boundaries for subsequent elections.

The Minister will have to explain why the Government have changed their mind. We have never been given any reason for the Government going back on the promise given at Report stage in another place. The Minister has to explain why the Government have changed their mind on the promise given by Allan Stewart that it would be the district council boundaries mat would be used in the initial elections.

In favour of Fife, it has to be said that at present there are 92 councillors throughout Fife. Fife's argument has never been that there should be 92 councillors in the local authority. Its evidence has always been that there should be no more than 70 councillors in the new authority. So Fife is not arguing for 92 councillors. The Minister would be well advised to take on board the arguments and come up with a much better arrangement than the 46 councillors suggested for Fife.

It is absolutely appalling that as a result of the Bill the Secretary of State will make 10,000 appointments to quangos, including six new quangos created as a result of the legislation. It has nothing to do with the devolution of power and everything to do with the centralisation of power and the creation of quangos. There will be 10,000 appointments made by Mr. Ian Lang, as against only 1,000 councillors elected by the 5 million people who live in Scotland. That is not acceptable: we need a second look at the matter. We cannot resolve the matter tonight. We shall need to come back to it. I appreciate that and look forward to what the Minister has to say.

The Earl of Balfour

My Lords, are we taking Amendment No. 22 as well as this one? Amendments Nos. 21 and 22 are grouped together.

Lord Fraser of Carmyllie

My Lords, it was certainly my intention to respond to Amendment No. 22 in replying to this short debate. As the noble Lord, Lord Ewing, correctly anticipated, my response was going to be that consultation is under way. I can imagine what would be the reaction of the noble Lord and indeed other noble Lords if, prior to the completion of that period of consultation, I were to indicate on behalf of the Secretary of State that any firm decisions had been arrived at in terms of councillor numbers. I indicated during the course of an earlier debate on the Highlands council proposal that our proposals in the consultation paper are not set in concrete and that we look forward to proposals that might be made by those who wish to offer a different set of numbers.

For the vast majority of areas in Scotland we propose in the consultation the use of up-to-date district wards, or in a few areas—that is to say, Borders, Dumfries and Galloway, and Fife, to which the noble Lord drew particular attention —regional electoral divisions. These particular proposals have a set of clear advantages: namely, they have been subject to the statutory review procedures of the local government boundary commission for Scotland.

I appreciate exactly the point that the noble Lord made; namely, that those who represent the Fife interest have not argued that there should be 92 councillors. They recognise that that number might be excessive. I have not seen the submission but informally I understand, as the noble Lord indicated, that they would advocate something in the region of 70. I ask the noble Lord to reflect on that for a moment. To reach a view that there should be 70 councillors in Fife would effectively mean redrawing every single ward in Fife. That may well be done, and it may be very desirable to do it. The point on which I hope we would be at one is that the noble Lord would consider it to be highly undesirable that the Secretary of State or the Scottish Office should draw up those figures. If unjustly, we have been accused of gerrymandering in regard to the new councils that would be as nothing compared to the uproar there would be if within the Scottish Office we sought to define what were to be the individual wards.

It may be necessary at some time to set about a fundamental change. But I strongly suggest that that is not a task to be undertaken by the Scottish Office but by the local government boundary commission at an appropriate point. If Amendment No. 22 were to be accepted, it would indeed be necessary to draw completely new lines on the map.

I turn now to Amendment No. 21. I listened with interest to what my noble friend Lord Dundee had to say. But I have to advise my noble friend that the effect of his amendment would be to apply those district wards that were used for the 1992 elections to the first elections to the new councils in 1995. As I understand his proposals, the only departures from that approach would be in those areas where the new council boundaries cut across district wards. That would produce a Scotland-wide total of 1,242 councillors. That is the current number of district and islands councillors at present.

In practice there is not a great deal of ground between the noble Lord's position and that of the Government. At a very early stage we made clear that a district ward approach was the preferred option and that there should be departures from that approach only to meet local circumstances—for example, where that approach might produce councils that were too large. That was set out in our White Paper published in July 1993.

Our consultative proposals have reflected that commitment. As I said, we cannot pre-judge the outcome. I emphasise that the proposals in that paper are not set in tablets of stone and we shall look closely at all comments received before reaching a final conclusion. With those words, I hope that my noble friend feels able to withdraw his amendment.

The Earl of Dundee

My Lords, I am grateful to my noble friend the Minister. I take on board the point he made when he elaborated on the difficulty that might arise if the Scottish Office or the Government were to set out quite soon to set boundaries, which should more correctly be the job of the Boundary Commission. At the same time he referred to the consultation process which is still going on. He expressed his sympathy with the general feeling of the amendment which was emphasised by the noble Lord, Lord Ewing. Obviously, when the new unitary authorities are up and running it would be good to give them every confidence that they have the kind of representation that they expect. In the first period of their job—the first few years when they are acting as representatives—clearly it is particularly important that councillors and their new authorities are not necessarily restricted. I hope that as a result of the consultation process there might be some meeting on numbers between 92—as in the case of Fife, which I accept would not be possible—and 46; possibly about 70 councillors, and that sensible compromises may be reached in all other areas.

Meanwhile, in view of what my noble friend the Minister said, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 22 not moved.]

Clause 8 [Transfer of employees]:

Lord Carmichael of Kelvingrove moved Amendment No. 23: Page 4, line 24, leave out ("may") and insert ("shall").

The noble Lord said: My Lords, in moving this amendment I shall speak also to Amendments Nos. 24, 25, 26, 27, 28 and 29. I regret that I must make an extended speech on this group of amendments.

The purpose of the first two amendments is to ensure that there is a statutory obligation to transfer all staff to the new authorities and that the Transfer of Undertakings (Protection of Employment) Regulations are adhered to. The Government have admitted that their proposals will lead to a reduction in staff. They estimate that between 700 and 2,200 people will lose their jobs as a result of the abolition of one tier of local government.

The Secretary of State for Scotland has already announced that around 30,000 local authority staff face the prospect of redundancy if reorganisation proceeds in the way in which he wishes. Since the cost to the Exchequer of each unemployed person is approximately £9,000 per year, the Government's proposals will place a huge burden on national resources.

We strongly believe that all employees should be transferred to the new authorities. The unions believe that the employment rights of all local authority staff in Scotland who will transfer to the successor councils should be protected by the Acquired Rights Directive and that that should be enshrined in the Bill. The Transfer of Undertakings (Protection of Employment) Regulations—generally known as TUPE—as amended, implemented in UK law the provisions of the Acquired Rights Directive. If implemented, the jobs, pay and conditions and pension rights of staff transferring to a new employer would be protected.

In particular, Article 6 of ARD requires employers at the earliest opportunity to state: the reasons for the transfer; the legal, economic and social implications of the transfer for the employees; and the measures envisaged in relation to the employees. So far, the Government have neglected their obligations to protect staff employment rights under the Staff Commission, which is seen to be independent so that it will enjoy the confidence of Scottish local government staff. That is the first part of this fairly long group of amendments.

Clause 8 as presently drafted contains a substantial provision governing the transfer of staff from existing councils, joint committees, joint boards and residuary bodies. It enables the Secretary of State by order to provide for the transfer in terms which he thinks appropriate. We believe that it is wrong in principle and inappropriate in practice to leave the transfer arrangements for 300,000 employees solely to the discretion of the Secretary of State. That can only lead to further uncertainty about their long-term prospects and undermine staff morale even further. Those people have families with problems, and from a long history and experience of others they would assume that, provided they did a good day's work and continued to serve their employers properly, they could look forward to having a job for a long time, if not for life.

During a debate in your Lordships' House the noble and learned Lord, Lord Fraser of Carmyllie, stated—he will be glad to know that he is still being quoted—that, It would be very unfair if local authority employees were left in a state of uncertainty for any longer than is necessary. Staff organisations have already expressed concern at the low morale and stress that can be caused by prolonged periods of uncertainty".

The noble and learned Lord will be aware of that because historically in the other place uncertainty and low morale are a recurrent factor as we approach general elections.

The anxieties of the noble and learned Lord, Lord Fraser, are shared by us, for this reason. Only through a guarantee in primary legislation that all staff will transfer to the new authorities can the uncertainty be minimised and morale maintained. It is only through such a guarantee that the ability to maintain the current high quality provision of a wide range of local services will be possible. That is no more than was guaranteed in the 1973 Act. If the noble and learned Lord looks at the Local Government (Scotland) Act 1973, Section 216(2), he will see what I am driving at.

In a debate in the other place regarding reorganisation of local government in Wales, the Minister, Sir Wyn Roberts, emphasised that procedures for staff transfers would be put in place which, would maximise certainty for staff at the earliest possible stage in each case".—[Official Report, Commons 16/6/94; col. 788.]

I am not arguing at this point that that should be for ever; that it should be written in stone. But we believe that for a period those guarantees should be given to staff until the shake-out is organised and people know where they stand. That would remove a certain amount of uncertainty and slowly, methodically and humanely reorganisation of the staff can take place, with proper conditions and rules to ensure that those who cease to be employed will be provided for. I hope therefore that the Government will either accept the amendment or give very good reasons for not accepting it. I beg to move.

10.15 p.m.

Lord Thomson of Monifieth

My Lords, I simply put on record that we on these Benches support the amendment introduced by the noble Lord, Lord Carmichael. As I would be speaking from exactly the same brief as the one from which he spoke, I shall not take up the time of your Lordships' House.

It is a matter of substantive reassurance to the local government officials in the period of reorganisation. It seems wrong in principle that this matter should be entirely at the discretion of the Secretary of State. It is right that there should be a provision on the face of the Bill to give the officials certainty. That would be preferable to having to deal with matters through a series of court cases. I hope that there will be a sympathetic response from the Government to the arguments.

The Earl of Balfour

My Lords, I am intrigued by these amendments. It is very much better that "the Secretary of State may by order make provision" as regards Clause 8 rather than that the dictatorial word "shall", suggested by the noble Lord, Lord Carmichael, should be used. That refers to Amendment No. 23. I believe that Amendment No. 24 would include all employees who are due for retirement.

I have read Amendment No. 25 many times and I do not fully understand it. From what I do understand of it, I believe that it would considerably weaken the consent which must be obtained from the new authority under Clause 8. I very much welcome Government Amendment No. 28 in this group of amendments. It will be very sad if we leave out Clause 11 because I believe it has much merit.

Lord Stoddart of Swindon

My Lords, I support the amendments so ably proposed by my noble friend Lord Carmichael of Kelvingrove. I shall not go into the details as he did because I have the same brief. However, I wish to elaborate on the matter. It is a fact that the Bill is causing great uncertainty and upset to the staff. It is undoubtedly lowering their morale. It would be entirely in the interests of good administration if, as the amendment suggests, all staff were transferred to the new authorities when they take over. That would enable the local authorities to employ the people they need to man the new bodies. If the employees are to be selected before the new authorities are set up, it may very well be that the very staff they need to man and administer the new authorities will have been allowed to go. In that respect the amendments are very satisfactory and would help in the changeover from one set of local authorities to another.

As my noble friend pointed out, the cost of the 30,000 redundancies which the Government admit may arise, will be astronomical. At £9,000 per head we are talking about no less a sum than £280 million. In terms of the amount per head in Scotland that is a considerable sum which could be used for improving the social services in Scotland.

I now turn to the acquired rights directive from which employees in local government and public services as; well as private industry should benefit. The noble Lord will know that I am not over-enamoured of directives from Europe. The fact is that we have had this directive and since the Government seem to want to obey every other directive that comes from Europe, I suggest that they respond and obey this one as well. That would benefit the staff of Scottish local government who are going to transfer. I hope that the Minister will listen to the arguments that my noble friend has advanced on these matters.

I support Amendment No. 29 which seeks to remove Clause 11 from the Bill. It appears to me that that clause gives the Secretary of State powers to designate an existing body or to establish a new body, the purpose of which would be to interfere in accepted collective bargaining arrangements. I believe that that would be a dangerous thing to do. The Minister knows that the existing collective bargaining arrangements work well, are accepted by employer and union alike and have been working for a long time. They have developed over many years. Their objectives are agreed and the criteria that are used for assessing salaries, grades and conditions of service have been established by joint action over a period of time.

A new body such as that proposed by Clause 11 would be destabilising for staff and authorities alike. It would add to uncertainty at a time when staff are already worried about the effects of job transfers. [simply do not understand why the Minister and the Government want to cause such uncertainty or why they appear to wish to interfere with the arrangements which, as I have said, have been built up over many years and which are trusted by both staff and employers. I hope that the Minister will be able to give us some reassurance and perhaps accept the amendments.

The Lord Advocate (Lord Rodger of Earlsferry)

My Lords, perhaps it would be for the convenience of the House if I were to begin with Amendment No. 28 which stands in the name of my noble and learned friend Lord Fraser of Carmyllie. It is a separate and technical amendment which should be uncontroversial. It is intended that the transfer of staff from existing local authorities to the new water authorities should be handled on the same basis as the transfer of staff from the old to the new local authorities. We are seeking to put staff of the new water authorities into the same position as staff of the new local authorities. Whatever else may be the merits of the provisions, I am sure that your Lordships would like that matter to be covered by the clause. As I have said, it is a technical matter.

Your Lordships are now dealing—everybody agrees this—with one of the most sensitive areas surrounding the Bill. It is for that reason that I deprecate the fact that—if I heard aright—it has been suggested in this short debate that we envisage about 30,000 redundancies. As was said on a previous occasion—and as is consistent with the Financial and Explanatory Memorandum which accompanies the introduction of the Bill in print in your Lordships' House —that is not the case. Although it is difficult to be sure about such things, the Government envisage that there will be between 220 and 1,800 redundancies. As I said in Committee, we envisage that most of those in local authority service will transfer. Indeed, as I said previously, a school that employs teachers on 31st March is likely to require exactly the same teachers on the following day. Therefore, the provisions will not make any difference to those people. In broad terms, we would expect most people to transfer, so we are not dealing now with the vast majority of local government employees. It would be most unfortunate if anything that was said in your Lordships' House were to cause unnecessary worries to people who will obviously be feeling vulnerable already.

Your Lordships have rightly cited the fact that the 1973 Act provided for all the staff to transfer. That is a possible model. But the question for the Government and your Lordships is whether that is the most appropriate model. Even those of your Lordships who were arguing the case for that, perhaps reading from the brief, admitted that that of course would not be the end of the matter. The staff might be transferred by this provision but the question as to whether that was substantial, long-term employment would remain unresolved. So the question for the Government and your Lordships, and the one that has been considered, is how best to deal with that matter. The Government consider that such a transfer would offer no guarantee of a job to the existing staff. All that it would do would be to create a misleading illusion that the staff would have a job because they would be transferred automatically.

Nothing along those lines that your Lordships wish to have in the Bill would prevent the new local authority from giving notice to the staff whom it considered to be surplus to its requirements. For that reason, we consider that it would be positively misleading to include such a provision.

It was suggested that the staff would transfer and then the new local authority would be able to select the staff that it wanted. It is that kind of decision that we would expect the shadow authorities to be taking during the year of their existence. All your Lordships would be doing would be to postpone such a decision until after 1st April 1996. We do not believe that it would be prudent, or even kind to the employees concerned, for them to have that indecision hanging over them for that length of time.

If people are going to have secure jobs they will be happy and they will soon hear. It is no kindness to those who will not have secure jobs to give them the illusion that they will have a secure job and for them to find later, when it may be even harder for them to obtain employment, that that is not the case.

We believe also that it could be positively disadvantageous if the new authorities were obliged to take on all staff. It would impose upon them the burden in the early stage of their existence, when they will obviously have many decisions to take, of deciding whether or not to retain staff. It would be in all senses better if those decisions were pulled forward. For that reason we do not believe that an automatic transfer provision would be in the best interests of the staff or the new local authorities.

Of course we would expect that in the coming months the Staff Commission which is to be set up, and which already exists in shadow form, will be looking carefully at all the arrangements relating to staff and will be putting forward advice under the terms of Clause 12(2) (c) to the Secretary of State who will in turn make the staff transfer orders. Everyone concerned is of course aware of the need, for the very reasons that your Lordships have given, for a clear picture to be given as soon as possible. We believe that the way we have chosen is the way it will in fact be done.

Perhaps I may now turn to TUPE, which we dealt with extensively in Committee. TUPE is the way in which the United Kingdom fulfils the obligations imposed upon it by the acquired rights directive. The United Kingdom has already fulfilled the legal obligations imposed upon it by the directive. That is it. The effect is that the directive has become part of United Kingdom law by effect in United Kingdom law of the transfer of undertakings regulations. They are the same as any other set of regulations; they are, in some ways a fortiori, part of the United Kingdom law just as any other statutory instrument or statute. The result is that the regulations apply to local government reorganisation in the sense that where there is a transfer of undertaking the regulations bite. It is open to various opinions, but we do not believe that they would apply in all circumstances to all transfers under the local government reorganisation. We accept that they would apply to some but they would not necessarily apply to all. We say only that the regulations, forming part of the law of the United Kingdom, including Scotland, where they apply, upon transfer of undertaking, will have full effect. Therefore, the people will transfer across with their contractual rights and so forth intact.

There is no reason for any additional matter to be put into the Bill. The regulations are already part of the law of Scotland and will apply when they are meant to apply. I believe that in the light of that explanation there is no need for the amendment, which would refer specifically to the transfer of undertakings regulations.

Amendment No. 29 relates to Clause 11, which is a reserve power. In no sense are the Government seeking—

Lord Stoddart of Swindon

My Lords, I am obliged to the noble and learned Lord for giving way. I listened carefully to what he said about the TUPE regulations. He appeared to say that there is no wholesale transfer of staff and that there are only certain instances where the TUPE regulations will apply. That is the point of difference because it seems to me, and it certainly seems to UNISON, that where there is a complete change of authority—and here we have old authorities disbanded and new authorities set up—there must be a change and a transfer from one authority to another. Therefore, all the employees should be covered by the TUPE regulations. That is what the noble and learned Lord has not been able to convince me, my colleagues or the unions, about.

Lord Rodger of Earlsferry

My Lords, far be it for me to claim infallibility in these matters. Let us suppose that I am wrong and that the noble Lord, his friends, the unions and so forth are correct in their view. In that situation, TUPE would apply and all the rights would pass across. I do not happen to believe that that is correct. There will be cases where it will apply. Where there is a little unit of people, say, cleaning in a local authority office and all that happens is that in the following week the same people are working in the same office and the same cleaning is being done, I can well see that one might say that there was a transfer of the undertaking. However, let us suppose, for example, that a regional authority is split into more than one authority so that the little cleaning unit does not go to one authority but is split up—it may apply also to teachers or to a finance unit—and that the unit is not identifiably the same on another occasion. It would be a matter for the courts, for the employment tribunals and, at the end of the day, for interpretation by the European Court of Justice, although it has given its view. However, in that situation the question will be whether an undertaking has been transferred. That is the issue here. We are not satisfied that in all circumstances it would be so. But if I am wrong on that, the noble Lord is correct—the effect of TUPE would apply and the rights and obligations would go across. My simple point is that TUPE applies where it applies. It is part of the law of Scotland and therefore if people are entitled to the rights under TUPE they will get those rights. The only question is whether that is something to which they will be entitled in all circumstances. I think that there are circumstances where they would not be entitled to it.

Lord Stoddart of Swindon

My Lords, I do not want to keep the House for very long but this is an important point. I accept entirely what the noble and learned Lord says, but the fact is that there could be two views as to whether the TUPE regulations apply. That means that in the last analysis the matter would have to be settled by the European Court, which could take a number of years, during which time the staff who had been affected would be out of a job. They might even be dead. All kinds of things will have occurred. That is what we are worried about. If the amendments were passed and all the staff were transferred to the new authorities it would obviate the problems which would arise if the TUPE regulations were breached.

Lord Rodger of Earlsferry

My Lords, I have already gone over the reasons why we do not believe that all staff should transfer. As the noble Lord knows, even where TUPE applies it is still open to the company to which the staff are transferred, for certain organisational and other reasons, to dismiss the staff. Therefore, there is no absolute guarantee. I admit that at the end of the day one could have a legal dispute in certain areas. It is conceivable that there might be a ruling from the European Court, but probably not because the principle has been laid down by the European Court. It is the application of the principle to any individual situation which is usually what is at issue; and that is a matter for the national courts.

Be that as it may, for the reason which I have already given I do not believe that anything saying that people should pay due regard to the transfer of undertakings regulations, as is envisaged in Amendment No. 27, adds one iota to the law which already exists in the United Kingdom. If it applies, it already exists and it applies in the appropriate circumstances. For the reasons I have already outlined we do not believe that transferring all the staff, which would resolve the matter in the way in which the noble Lord suggests, is a sensible way forward.

Perhaps I may turn briefly to Amendment No. 29. The Government are not seeking to have any general control over local authority pay levels. As your Lordships will see from subsection (1) of Clause 11, it seeks only to look into pay increases awarded by existing or new authorities during the period of reorganisation. It is not a question of the authority being asked to examine absolute pay levels. I would remind your Lordships, as I think your Lordships are aware, that this clause corresponds to Section 221 of the Local Government (Scodand) Act 1973. It is designed to deal with the same matter as Section 221 was designed to deal with in the previous reorganisation, which is to meet concerns that the period of transition might be exploited to give an opportunity for excessive pay rises, accelerated increments or upgrading of staff beyond normal expectations.

I believe that the provision is designed in the interests of local authority staff in general. If particular employees are singled out and given excessive increases in remuneration they may then transfer to new authorities on unduly inflated terms or may receive undue amounts of compensation. That would be unfair to other staff members of local authorities.

I do not shrink one moment from saying that it is right that the taxpayer should have some degree of protection. Of course, no one questions the fact that people should receive the appropriate level of remuneration, but it would be wrong for re-organisation to be used as some sort of excuse or reason for a drastic increase in salary levels.

We are talking about reserve powers. It is hoped that they will not have to be used. They are there and, therefore, can be used; but no one, in fact, wishes to use them. Noble Lords will notice that there is a provision in the clause which states that the Secretary of State can enforce salary levels only where they have been recommended by the advisory body. As will be seen from the terms of the clause, that body must have due regard to any recommended levels of remuneration formulated on a national basis. Therefore, the advisory body cannot simply decide an appropriate increase in isolation from the accepted norm in local government circles.

Finally, I must stress the fact that not only are these reserve powers: they are transitional only. Noble Lords will see from the last subsection of the clause that the powers are available to the Secretary of State only until 31st March 1997. They are designed purely to deal with the reorganisation period. I am sorry to have taken so long with my response to such matters. However, they are important and I recognise that noble Lords are rightly concerned about them. I hope that I have been able to go some way towards reassuring your Lordships.

10.45 p.m.

Lord Carmichael of Kelvingrove

My Lords, I am sure that the noble and learned Lord the Lord Advocate is a kind and generous man; but, unfortunately, he has said one or two things which I believe come from an instinct rather than his own inherent nature. For example, he said specifically that there would not be a vast number of employees made redundant. He actually said that there might be a few cleaners in a small unit who could be made redundant. However, he did not say that there might be a few lawyers or accountants going. I am sorry, but that is how the whole tenor of his apologia struck me.

I always think of that marvellous phrase that I believe President Roosevelt used. He said that when the man next door is unemployed it is a mild recession, but when you are unemployed it is a depression and a slump. The point I am trying to make is most important. If someone is working as a cleaner and trying to earn every penny possible in order to keep the family and the household going, it is even more important that that person should be treated properly.

I accepted the fact that, in reorganisation, there would be —indeed, as there frequently is—a re-examination of roles and jobs and that, therefore, there may well be unfortunate but inevitable redundancies. But the purpose of our suggestion is to ensure that everything is done in a slow, orderly and as humane a way as possible to allow people to readjust. I believe that the noble and learned Lord really believes that and that that is what he wants; but he is being pressed by other forces.

The noble and learned Lord also spoke about the control the Secretary of State would have over the payment of excessive salaries. Can we look forward to an amendment to the health service regulations which will ensure that the health service trusts will not have total control in this matter and ignore national norms, and perhaps the wishes of the Secretary of State, in relation to the quite obscene salary increases they have given to chief executives? That is what people feel is happening. This is one of the reasons why politically the party opposite will not do very well because there is a feeling that there is a law for them and a law for the rest of the world. Although, as I say, I believe that the noble and learned Lord the Lord Advocate is basically a kind man, I think he should occasionally look at the real world away from the advocates' chambers in Edinburgh and consider what everyone else thinks. I really am tempted, because of what he said, even with a depleted House, to ask the opinion of the House on this matter just to put down a marker.

10.51 p.m.

On Question, Whether the said amendment (No. 23) shall be agreed to?

Their Lordships divided: Contents, 12; Not-Contents, 26.

Division No.5
Carmichael of Kelvingrove, L. Mackie of Benshie, L.
Ewing of Kirkford, L. Mar and Kellie, E
Falkland, V. McNair, L.
Graham of Edmonton, L. [Teller.] Monkswell, L.
Stoddart of Swindon, L.
Hamwee, B. Thomson of Monifieth, L. [Teller.]
Macaulay of Bragar, L.
Arran, E [Teller.] Goschen, V.
Balfour, E. Henley, L.
Blatch, B. Howe, E.
Carnegy of Lour, B. Inglewood, L.
Chalker of Wallasey, B. Lucas, L.
Craigmyle, L. Mackay of Ardbrecknish, L
Cranborne, V. [Lord Privy Seal.] Northesk, E
Cumberlege, B. Rodger of Earlsferry, L.
Denon of Wakefield, B. Saltoun of Abemethy, Ly.
Dundee, E. Skelmersdale, L.
Ferrers, E. Strathclyde, L. [Teller.]
Fraser of Carmyllie, L. Teviot, L.
Gisborough, L. Trumpington, B.

Resolved in the negative, and amendment disagreed to accordingly.

11 p.m.

[Amendments Nos. 24 to 27 not moved.]

Lord Rodger of Earlsferry moved Amendment No. 28: Page 4, line 39, after ("authorities") insert (", or of the new water and sewerage authority or authorities (within the meaning of Part II of this Act),").

On Question, amendment agreed to.

Clause 11 [Remuneration of employees of local authorities]:

[Amendment No. 29 not moved.]

The Earl of Arran

My Lords, I beg to move that further consideration on Report be now adjourned.

Moved accordingly, and, on Question, Motion agreed to.