COMPENSATION FOR DAMAGE OR LOSS CAUSED BY PUBLIC GAS SUPPLIERS' CONSTRUCTION WORK

HL Deb 18 October 1995 vol 566 cc772-809

(" . In Paragraph 1(3) of Schedule 4 to the 1986 Act (Power of Public Gas Supplies to break up streets, bridges etc.), after the second "shall" there shall inserted "as promptly as possible", and after "any" there shall be inserted "loss caused or".").

The noble Baroness said: My Lords, I am afraid that I cannot emulate the speed with which the previous few amendments have been moved. I hope that the spirit of harmony will continue throughout. The purpose of the amendment is to enable businesses to claim compensation for damage or loss caused to them by gas transporters' construction work. I first raised this amendment at Committee stage. The Minister then at the Dispatch Box said that he would consider what had been said because there was a considerable amount of support for the amendment. I tabled it again on 19th July as a reminder in case it should be overlooked. Nevertheless, it has taken nearly three months for the Government to bring forth their own amendment on this subject, despite many letters from interested organisations, which means that there has been little time to discuss the government amendment. I shall return to that in a moment.

My amendment has been supported by the British Retail Consortium, the Country Landowners' Association, the National Farmers Union, the Forum of Private Business, the Association of British Chambers of Commerce, the Association of Convenience Stores and many individual businesses as well as many Members of your Lordships' House.

At Committee stage I did not give illustrations of need because we were dealing with the business very late at night. I do not propose to keep your Lordships very long on the matter. However, there are two illustrations which I must give because they bear a little on the possible regulations which the Government may produce. These have been given to me by the Association of Convenience Stores. They are real cases which have happened this year. A Mr. Beacall, with a store of 1,900 square feet, had his trade affected by gas works outside his shop from 23rd January to 17th March this year. Over the period his loss of income can clearly be demonstrated to be of the order of £14,500. His annual turnover was just over £500,000, so he would not be able to claim under the British Gas proposal, which the Government have favoured in the past.

A Mr. Holborn, running a newsagents and general store family business in Redhill, relies heavily on passing trade. British Gas closed the road in which his shop is situated for six weeks in June this year. During that time his weekly takings fell from £48,000 to £43,250, pushing his business into the red. Since he could not claim compensation, that left him struggling to pay off an overdraft on a very small profit margin. He is still trying to do that.

Government Amendment No. 151 appears to accept the principle of compensation, for which I am grateful. But it leaves many questions to be answered. Subparagraph (4) states "if' the regulation is made. Why cannot we have a firm commitment to regulate? Is it that the Government have still not made up their mind despite the promising beginning to this amendment? Why cannot we have a timetable if there are to be regulations? Can we be given some idea of when those regulations are likely to be brought forward? Will there be a ceiling on the size or the turnover of the businesses which can claim? The British Gas proposal of £500,000, which I have already mentioned, would be much too low. Many vulnerable businesses would fall outside that threshold, and that would include many farms. We need to have a little more information from the Government on that proposal. Is that what they intend to put in regulations?

There can be no justification for private gas companies making extra profit at the expense of other private companies. I find it very difficult to understand why the Government fail to see that point, as they have done on other occasions. What is the purpose of subparagraph (5) in the second part of the amendment? It would seem to remove all possibility of future adjustments if the regulations were found to be ineffective. It appears to require the unanimous consent of all gas transporters before changes can be made. Is that how the Government see it and is that their intention? I await the Minister's answers with interest before deciding what action to take on my amendment. We shall need to look very carefully at what the Minister says. I beg to move.

Lord Stanley of Alderley

My Lords, I have added my name to the amendment of the noble Baroness, having read the Committee stage report of her amendment and having found the Government's reply inadequate. It would be wasting your Lordships' time to restate all those reasons. However, her amendment mirrors many of the problems that your Lordships discussed and voted on affirmatively during the passage of the Coal Bill in relation to CROs. Eventually the Government accepted that in principle. This particular point was referred to obliquely by the noble Lord, Lord Peston, at Committee stage.

However, I am pleased that the Government have now come forward with their amendment, even at a very late stage, as the noble Baroness has said, to solve the problem by means of regulation. I thank and congratulate the noble Baroness on persisting so strongly through the summer months to get the Government to do so. I believe that I and many of your Lordships dislike government by regulation. I would much prefer to see the amendment on the face of the Bill.

As the noble Baroness said, the Government have given no time or date as to when this regulation might come about; for that matter, it might never appear. An assurance from my noble and learned friend would be very welcome, if not vital. Furthermore, the Government have given little indication as to what the regulation might state. Not least, I ask for an assurance from my noble and learned friend that there will be no ceiling on the turnover of the business. That again is a point made by the noble Baroness. In the past it has been mooted at £500,000.

I believe that the noble Baroness was too charitable about subparagraph (5), which I dislike intensely. I do not know what she intends to do. I believe that she is still thinking about it this evening. If these assurances cannot be given by my noble and learned friend—and I fully understand that he may not be able to do so tonight—I wish to preserve my position, as I believe the noble Baroness does, to press him to do so at Third Reading.

Baroness Gardner of Parkes

My Lords, I support this amendment. I have known people whose businesses have gone bankrupt simply because potential customers could not gain access. I am thinking of a woman who for years ran a small Australian gift shop off the Strand. I believe that it was the water board which closed the road and there was no access for customers for a considerable time. The poor woman is now desperately ill and her future has gone. Indeed, customers were convinced that she had closed the business and gone. People gave up trying to reach her and that situation continued for something like two years.

There is a very genuine case for compensation. Clearly, one would have to prove that there had been losses. There would be no question of people getting money for nothing. A claim would have to be clearly quantified and assessable, so there would be no doubt on that point.

As regards government Amendments Nos. 150 and 151, I find the use of the word "if' quite extraordinary. I cannot see the real merit in the use of that word. If we simply had "to the extent" that would be iffy enough. To use the word "if' makes for a very strange piece of legislation. All these points have been made and I do not wish to take up time. I strongly support this amendment.

The Earl of Harrowby

My Lords, I supported my noble friend on the Coal Bill. I am delighted to say that I support him again on this issue. Enough has been said about the detail of the subject. I hope that my noble and learned friend the Minister will take note of the feeling on both sides of the House.

Lord Skelmersdale

My Lords, I caused some surprise when I supported the noble Baroness in Committee. I still have some sympathy. As regards what I said at the Committee stage, on balance, this matter has much wider application than just to the gas industry. I believe that the Government's amendment is probably right. What is disguised in the Government's amendment—and to this we should have an answer—is the use of the word "if'. I understand the comments which have been made on this perhaps rogue word. I include also the words, and to the extent that regulations made by the Secretary of State so provide and so on. Regulations under what? Will they be regulations under the new Section 4 of the Gas Act, or will they be under the street works legislation or something else? That is very germane to the argument.

The Earl of Caithness

My Lords, I thank my noble and learned friend on the Front Bench for bringing forward the government amendment. Clearly, he listened to the concerns that we all expressed in Committee. Although there are undoubtedly anxieties about the proposed government amendment, I look forward to hearing what my noble and learned friend Lord Fraser has to say and thank him for having moved forward between the last stage and this stage of the Bill's progress.

Lord Peston

My Lords, I should like to make just a few remarks. First, my noble friend Lady Nicol is entirely right about the principle, which is that the privatised utilities should not be in a position to impose costs on other private enterprises just because they were once nationalised industries. That is the central theoretical proposition which must guide all of us.

Secondly, as the noble Lord, Lord Skelmersdale, pointed out, this question does not arise only in relation to British Gas. The problem arises with all the former nationalised utilities, but we are dealing with gas today. My judgment is that everything revolves around the meaning of the government amendment and what will happen in practice. The noble Earl, Lord Caithness, made that point very clearly.

If we get the regulations, I think that sub-paragraph (4) will be fine. My noble friend's concern is whether we shall have those regulations. I hope that when I sit down in a moment the noble and learned Lord, Lord Fraser of Carmyllie, will say that, although we shall not get the regulations this very minute, we shall certainly get them. I must advise my noble friend that I do not have any difficulty with sub-paragraph (5) because, assuming that we get suitable regulations under the provisions of sub-paragraph (4), sub-paragraph (5) is minor in that it states that having got a set of good regulations, it should take a good deal to change them. Perhaps the Minister will tell me whether my interpretation is correct. That is why I am less worried about sub-paragraph (5), but I want to be told that we shall get the regulations under the provisions of sub-paragraph (4) along the lines that my noble friend has suggested. I think that that is the beginning and the end of it and I look forward to hearing what the Minister has to say.

Lord Boyd-Carpenter

My Lords, as has been said, this issue arises in respect of all the former nationalised industries. It is therefore important that the Government should make clear at this stage and on this Bill their attitude to the whole matter.

5.15 p.m.

Lord Fraser of Carmyllie

My Lords, I hope that I can do just that in responding to the amendment tabled by the noble Baroness and in indicating where I stand on the Government's amendments.

The question of compensation in respect of street works is a complicated issue with both practical and theoretical considerations. These mean that it would not be appropriate, despite the anomalous case of the water industry, to provide an unqualified obligation to pay compensation.

Businesses do not have a legal right to a given level of passing trade. For example, if a competing shop opens and takes many of the customers away causing the original shop severe losses, there is no right to take action against the competing shop for the damage done. There are many factors which affect the level of passing trade which a business might have, including the taking of planning decisions which may affect the character of the neighbourhood and it would clearly be a wrong principle for compensation to be available as a general rule.

In the more particular case of street works, the generally accepted principle is that all users of a street must accept the risk of delays or disruption caused by other lawful users of the street. There is no right to claim compensation from the other members of a traffic jam, or from local authorities which close a road to resurface it, or when—this could be most damaging of all—the traffic management in a road is changed in a manner in which affects passing trade.

That does not mean that street works should be executed with no thought as to the inconvenience for other users of the street. The New Roads and Street Works Act 1991 regulates in some detail the manner in which street works are to be undertaken. This includes obligations to provide advance notice of planned works to the street authority and to abide by any requirements imposed by that authority; to secure that any part of the street which is open or obstructed is adequately guarded and lit; and to carry on and complete the works, and the reinstatement of the street, with all such despatch as is reasonably practicable.

Additional standards relating to the carrying out of street works have been agreed between British Gas and Ofgas. These include providing an alternative safe route if the footway is obstructed and ensuring that there is pedestrian access to all premises while work is in progress.

There is also the question of cost. Any requirement on public gas transporters to pay compensation in large amounts would inevitably find its way back through charges to the customer. That is because it is necessary to consider the costs of a utility in setting its price control. The Government are not convinced of the need for a general transfer of money from gas consumers to business in this way.

I have taken some time to make those general points because it is important that they are placed on the record. However, I should say that the Government have decided to review the position, especially as regards small businesses, where the costs arising from prolonged street works by utilities could fall very heavily. Clearly, a number of my noble friends are aware of particular circumstances where that has happened. Our conclusion is that, notwithstanding the position in logic as I have outlined it, some change to deal with exceptional cases is required.

For that reason, the Government welcomed the voluntary compensation scheme proposed by British Gas this May. That scheme represented, in our view, a fair and reasonable balance between the interests of the various parties. The scheme has, however, been criticised on the basis that public gas transporters other than British Gas are not bound by it, and that payments were a matter of sympathetic consideration rather than a strict obligation to pay in the appropriate circumstances.

We believe that those concerns have some weight. Therefore, I invite the noble Baroness to withdraw her amendment on the basis that I propose to move Amendments Nos. 150 and 151 which empower the Secretary of State to make regulations in this area.

I understand your Lordships' concern about the use of the word "if'. Perhaps I may make this statement: it would be our intention to frame the regulations to replicate, as closely as may be, the provisions of the British Gas scheme, but on a compulsory basis and applicable to all public gas transporters. I hope that that indication is broad enough, but if your Lordships remain uncomfortable, I shall look at the provisions again to see whether the word "if' could be removed. I believe that it is, in effect, technical given the undertaking that I have given at the Dispatch Box, but if it would reassure your Lordships I shall certainly consider doing so at a later stage. At this stage, I should like to be able to move my amendments so that there can be a clear understanding of what we have in mind. That will allow interested parties to reflect upon the matter before we return to this on Third Reading.

I was asked specifically about when the regulations would be made. We expect to make them by the appointed day, when the new regime comes into effect. We shall be consulting on the regulations. We want to see whether we can usefully discuss the regulations with the relevant associations before they are made. However, I believe that it will be appreciated that if we are to ensure that they can come into effect by the appointed day, that does not allow for the most leisurely period of consultation.

I hope that what I have said is sufficient to satisfy my noble friend, the noble Baroness and those on the Opposition Benches. I apologise for the fact that there has not been a great deal of time for those who are interested in this matter to consider the government amendment. Nevertheless, I hope that the noble Baroness will withdraw her amendment. If necessary, we can return to this on Third Reading.

Baroness Nicol

My Lords, before the noble and learned Lord sits down, he did not deal with the question about sub-paragraph (5). May we hear a little about the Government's thinking on that?

Lord Fraser of Carmyllie

My Lords, I think that it relates in large measure to the timetable and drafting arrangements. We proposed a very broad regulation-making power and did not include all the full details in the amendment. Having adopted that approach, it was considered that this was the appropriate way forward. The noble Baroness may wish to reflect upon that matter, and if she wishes to communicate with me before Third Reading I shall be happy to discuss it with her.

Baroness Nicol

My Lords, I am grateful to the Minister for his full answer, which I will have to consider in detail.

As to the question of the costs to the consumer, if the businesses about which we speak fail there will be costs to the consumer by another route. Many consumers will pay not only the financial costs of the businesses that are affected but possibly the social costs of losing them. I do not believe it is relevant to compare the difficulties caused by fair competition with the difficulties caused by road works. Any business worth its salt can meet fair competition by various means open to it, but it cannot do anything about road works.

I am encouraged by the Minister's attitude, and I shall study carefully what he has said. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 12 [Acquisition of rights to use gas processing facilities]:

Lord Fraser of Carmyllie moved Amendments Nos. 34 to 38:

Page 16, line 28, after ("facility") insert ("or any associate of his").

Page 16, line 31, after ("who") insert ("is not such an associate and").

Page 17, line 10, at end insert— ("( ) Section 22 of the 1986 Act (effect of directions) shall apply in relation to any directions under this section as it applies in relation to any directions under section 19 or 21(1) of that Act; and in subsection (4) of that section as applied by this subsection, the reference to the Director shall be construed as a reference to the Secretary of State.").

Page 17, line 12, leave out ("has the same meaning as in") and insert ("means any substance which is or (if it were in a gaseous state) would be gas within the meaning of').

Page 17, line 33, at end insert— ("( ) For the purposes of this section a person is an associate of the owner of a gas processing facility if—

1. (a) both of them are companies; and
2. (b) one of the companies has control of the other, or both are under the control of the same person or persons;

and subsections (2) to (5) of section 416 of the Income and Corporation Taxes Act 1988 shall apply for the purposes of paragraph (b) above as they apply for the purposes of Part XI of that Act.").

The noble and learned Lord said: My Lords, after that interesting debate, we turn to a series of technical amendments. I beg to move Amendments Nos. 34 to 38 en bloc.

On Question, amendments agreed to.

Clause 16 [Minor and consequential amendment]:

Lord Fraser of Carmyllie moved Amendment No. 39:

Page 18, line 20, leave out from first ("in") to ("as') in line 21 and insert— ("(a) any Act passed before the appointed day which is not a public general Act; or (b) any subordinate legislation (within the meaning of the Interpretation Act 1978) made before that day,").

The noble and learned Lord said: My Lords, this is also a technical amendment. I beg to move.

On Question, amendment agreed to.

Clause 17 [Transitional provisions, savings and repeals]:

Lord Fraser of Carmyllie moved Amendments Nos. 40 to 42:

Page 18, line 28, leave out ("section") and insert ("sections").

Page 18, line 29, at end insert— ("(1A) In that Schedule, unless the context otherwise requires, expressions which are also used in the 1986 Act have the same meanings as in that Act.").

Page 18, line 29, at end insert— ("(1B) The Secretary of State may by order make such other transitional provisions and savings as appear to him necessary or expedient. (1C) An order under subsection (1B) above shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.").

The noble and learned Lord said: My Lords, I beg to move Amendments Nos. 40 to 42 en bloc.

On Question, amendments agreed to.

Clause 18 [Short title, commencement and extent]:

Lord Fraser of Carmyllie moved Amendments Nos. 43 to 45:

Page 18, line 33, leave out from ("except") to ("shall") in line 34 and insert—

1. ("(a) this section;
2. (b) sections 8(2), 11(1) to (5), 12 and 13;
3. (c) section 17(1) and (1A) and Schedule 5; and
4. (d) so far as relating to the repeal of section 62(7) of the 1986 Act, section 17(2) and Schedule 6,").

Page 19, line 3, leave out ("and 22") and insert (", 22 and 27B").

Page 19, line 7, leave out ("section") and insert ("sections 62(7) and").

The noble and learned Lord said: My Lords, in speaking to Amendment No. 31, I spoke to Amendments Nos. 43 to 45. I beg to move those amendments en bloc.

On Question, amendments agreed to.

Schedule 1 [Exceptions to prohibition on unlicensed activities]:

Lord Fraser of Carmyllie moved Amendment No. 46:

Page 20, line 11, at end insert— ("1A. Section 5(1) of this Act is not contravened by a company conveying or supplying gas to any premises occupied by a subsidiary or holding company of the company, or by a subsidiary of a holding company of the company.").

On Question, amendment agreed to.

Schedule 2 [The gas code]:

Lord Fraser of Carmyllie moved Amendments Nos. 47 to 49:

Page 21, line 36, leave out ("arranged for gas to be") and insert ("made arrangements in pursuance of which gas is").

Page 21, line 41, after ("meter") insert—

1. ("(a) the use of which does not contravene section 17 of this Act; and
2. (b) which is").

Page 22, line 37, at end insert— ("( ) Nothing in this paragraph shall apply in relation to any meter which, in pursuance of an agreement falling within subsection (14) of section 17 of this Act, is used for ascertaining the quantity of gas supplied to a consumer if either—

1. (a) the agreement was entered into before the appointed day; or
2. (b) the public gas transporter and each relevant gas shipper have agreed that the meter should be kept in proper order by a person other than the consumer.").

The noble and learned Lord said: My Lords, I beg to move Amendments Nos. 47 to 49 en bloc.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 50 and 51

Page 23, line 35, after ("of') insert ("any of').

Page 24, line 9, after ("recover") insert ("any of').

The noble and learned Lord said: My Lords, I beg to move Amendments Nos. 50 and 51.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 52 and 53:

Page 24, line 22, after ("gas") insert ("which has been").

Page 24, line 23, at end insert ("in pursuance of arrangements made with the transporter by a gas shipper, or by a person authorised to make the arrangements by an exemption granted under section 6A of this Act").

The noble and learned Lord said: My Lords, I beg to move Amendments Nos. 52 and 53.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 54 to 56:

Page 24, line 44, leave out ("75,000") and insert ("2,500").

Page 24, line 47, leave out ("75,000") and insert ("2,500").

Page 24, line 47, leave out ("2,500") and insert ("75,000").

The noble and learned Lord said: My Lords, I beg to move Amendments Nos. 54 to 56 en bloc.

Lord Skelmersdale

My Lords, on the face of it, the difference between 2,500 and 75,000 therms is many magnitudes. I cannot imagine that this has resulted from an oversight, which most technical amendments are designed to resolve. Perhaps the House will wish to know a fraction more than my noble friend has said on the subject.

Lord Fraser of Carmyllie

My Lords, I am happy to oblige my noble friend. The effect of the amendments is that suppliers in the market to supply customers with 2,500 to 75,000 therms a year will have to opt in to the deemed market arrangements rather than opt out. The purpose of this is to simplify the transitional arrangements on the appointed day to allow existing suppliers to the industrial and commercial market to opt in to the new provisions for deemed contracts when they are ready to do so. Knowing my noble friend's detailed understanding of these matters, I hope that that is sufficient explanation for him.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendment No. 57:

Page 25, line 31, at end insert—

("Supplies of gas illegally taken

8A.—(1) Where any person takes a supply of gas which is in the course of being conveyed by a public gas transporter, the transporter shall be entitled to recover from that person the value of the gas so taken.

(2) Where—

1. (a) any person at premises which have been reconnected in contravention of paragraph 10(1) below takes a supply of gas which has been conveyed to those premises by the public gas transporter; and
2. (b) the supply is taken otherwise than in pursuance of a contract made with a gas supplier, or deemed to have been made with such a supplier by virtue of paragraph 8 above or paragraph 18 of Schedule 5 to the Gas Act 1995, 781 the transporter shall be entitled to recover from that person the value of the gas so taken.

(3) Each public gas transporter shall make, and from time to time revise, a scheme providing for the manner in which, and the persons by whom, the number of therms or kilowatt hours represented by a supply of gas taken in such circumstances as are mentioned in sub-paragraph (1) or (2) above is to be determined for the purposes of that sub-paragraph.

(4) Sub-paragraphs (10) and (11) of paragraph 8 above shall apply in relation to a scheme under this paragraph as they apply in relation to a scheme under that paragraph.

(5) In this paragraph— gas supplier" includes a person authorised to supply gas by an exemption granted under section 6A of this Act or an exception contained in Schedule 2A to this Act; value, in relation to any gas taken in such circumstances as are mentioned in sub-paragraph (1) or (2) above, means the amount which, if the gas had been taken in such circumstances as are mentioned in sub-paragraph (2) of paragraph 8 above, could reasonably be expected to have been payable in respect of the gas under a contract deemed to have been made by virtue of that sub-paragraph.").

The noble and learned Lord said: My Lords, I beg to move Amendment No. 57.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendment No. 58:

Page 26, line 17, leave out from ("premises") to second ("the") in line 19 and insert ("are reconnected, the consent of the public gas transporter to whose main the reconnection is made; (b) where the supply is restored,").

The noble and learned Lord said: My Lords, I beg to move Amendment No. 58.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendment No. 59:

Page 27, line 13, at end insert—

("Failure to maintain shipping arrangements

12A.—(1) Where—

1. (a) any arrangements for the conveyance of gas by a public gas transporter to a consumer's premises at a rate reasonably expected to exceed 2,500 therms a year have been made by a gas shipper, or by a person authorised to make the arrangements by an exemption granted under section 6A of this Act; and
2. (b) those arrangements have ceased to operate and have not been replaced by arrangements made for the like purpose,

the transporter may, after giving 21 days' notice to the relevant persons, disconnect the premises.

(2) The relevant persons for the purposes of sub-paragraph (1) above are—

1. (a) the occupier, or the owner of the premises if they are unoccupied; and
2. (b) any gas supplier who, to the knowledge of the transporter, has contracted to supply gas to the premises.

(3) The notice required to be given by sub-paragraphs (1) and (2)(a) above may, in the case of unoccupied premises the owner of which is unknown to the public gas transporter and cannot be ascertained after diligent inquiry, be given by affixing it upon a conspicuous part of the premises.").

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendment No. 60:

Page 28, line 30, after ("9(2),") insert ("10(2)(b), 12A(1),").

The noble and learned Lord said: My Lords, I beg to move Amendment No. 60.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendment No. 61:

Page 28, line 33, leave out ("5(4), 7(3)") and insert ("7(3) or (4)").

The noble and learned Lord said: My Lords, I beg to move Amendment No. 61.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 62 to 64:

Page 28, line 33, leave out ("or 9(2)") and insert (", 9(2) or I 0(2)(b)").

Page 28, line 37, at end insert ("either is no longer an owner or occupier of the premises or").

Page 28, line 42, at end insert—

("( ) In this paragraph— consumer", in relation to a disconnection or cutting off under paragraph 10(2)(b) above, means—

1. (a) the owner of the premises at the time when the reconnection was made, or the supply was restored, without the relevant consent if the premises were unoccupied at that time, or if that reconnection or restoration of supply was made by him or on his behalf; and
2. (b) the occupier of the premises at that time in any other case;

"relevant consent" has the same meaning as in paragraph 10 above.").

The noble and learned Lord said: My Lords, Amendments Nos. 62 to 64 are grouped with Amendment No. 60. I beg to move.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 65 and 66:

Page 31, line 33, leave out from ("supplier,") to ("may") in line 35.

Page 31, line 40, leave out from first ("above") to end of line 41.

The noble and learned Lord said: My Lords, I beg to move Amendments Nos. 65 and 66 en bloc.

On Question, amendments agreed to.

Lord Haskel moved Amendment No. 67:

Page 32, line 22, at end insert— ("( ) The transporter in the case of those who are disabled, of pensionable age or in other cases of urgent need is authorised to carry out repairs to gas appliances and fittings at the same time as the emergency visit; and the cost of this will be charged to the consumer.").

The noble Lord said: My Lords, I beg to move Amendment No. 67. A similar amendment was raised in Committee. However, as this matter looks after the safety of consumers, I feel that it is important to raise it again.

The amendment deals with the question of who gets an appliance working again after there has been an escape of gas. At present, a British Gas service engineer who attends a gas escape not only makes the escape safe but makes a permanent repair to the appliance, or a temporary repair and arrangements to have the appliance permanently repaired, or he turns it off and fixes a definite appointment to repair it. Under the new draft arrangements public gas transporters are required to undertake minor appliance repairs in the course of fixing a leak, so long as they can be done within half an hour and with inexpensive parts. The engineer then gives the consumer a list of registered installers who can be contacted.

The Minister must be aware that these kinds of cosy demarcation arrangements between suppliers at the expense of consumers are no longer acceptable. Today, successful businesses make every effort to satisfy their customers, even if it takes longer than half an hour. As drafted, the Bill primarily looks after the needs of the transporter by limiting liability to half an hour's work plus a few inexpensive parts. Surely, in modern business terms the Bill should ensure that priority is given to the needs of the consumer. The need of the consumer is that he or she gets the appliance working as soon as possible and with the least inconvenience. As with small businesses, the consumer wants a one-stop shop, not to be shuffled between the transporter, supplier or installer.

The effect of this on safety was raised in Committee by my noble friend Lord Peston. Unless there is a firm commitment to get appliances working again with the minimum delay and inconvenience, people may hesitate to report gas leaks in case their appliances are out of order for some time. Perhaps the Minister would wish to use this opportunity to reassure the House of his department's commitment to consumer safety.

In Committee, the Minister said (Hansard Col. 793) that it is important to distinguish between the obligation to make safe and the power to do so. That ignores the consumer's convenience. Many of us on this side of the House feel that the amendment should apply to all gas consumers, but, in order to appeal to the Minister's compassion, the amendment has been limited to those more vulnerable members of society, including the chronically sick. I beg to move.

5.30 p.m.

Lord Ezra

My Lords, I support what the noble Lord has just said. I well recall the debate that we had on this issue in Committee. This seems to be an instance when the new arrangements go back on what already exists. Under the present arrangements, as the noble Lord has pointed out, when a gas leak has to be dealt with not only is the leak stopped but any necessary repairs are done and urgent action is taken to ensure that the gas supply is reconnected as soon as possible.

Under the new arrangements, the consumer could well be left in the lurch. The leak could admittedly be dealt with, but then, particularly if it were in winter, and particularly if it happened to be at a weekend, the consumer would have to trawl through a list of plumbers dealing with these matters and it could be some days before the appliances were working again.

It is to be hoped that the amendment will be considered seriously from that point of view. We are all in favour of opening up the domestic market. What we are wholly against is that the services which are to be rendered to customers in that opened-up market might be noticeably worse in some respects than they are at present.

Lord Swinfen

My Lords, I support the amendment. Many of those whom the amendment seeks to help will he living on their own. They will be elderly disabled who will need heating. They may he unable to find the relevant contractor to help them in a hurry. With society as it is today, many people who live on their own do not have relatives nearby whom they are able to call upon for help. Gas appliances are, I suspect, more likely to break down in the winter because there is a greater use of heating then. The types of person that the amendment seeks to assist are those who need more heating than other people.

Lord Boyd-Carpenter

My Lords, whether the amendment has it right, I would not know, but I hope that my noble and learned friend the Minister will realise that this is, I think, to all noble Lords, a most important matter. The position particularly of disabled people when there is a failure of their gas supply is not just alarming but can be dangerous.

I am sure that the House will want to be reassured that the Bill as it stands or as it would stand if amended as proposed by the noble Lord, Lord Haskel, will take care of that. This is, socially, one of the most important issues with which we have been concerned this afternoon. I hope that my noble and learned friend the Minister will bear that in mind.

Lord Skelmersdale

My Lords, I have some sympathy with the points raised by the noble Lord, Lord Haskel, and echoed in various quarters of your Lordship's House. But I just do not understand the amendment. It provides: The transporter in the case of those who are disabled, of pensionable age or in other cases of urgent need is authorised". I assume that is by the Bill, but we will let that pass for the moment. It continues: to carry out repairs to gas appliances and fittings at the same time as the emergency visit". That is laudable of course. The transporter is authorised to do it, but he does not have to do it, as I understand it, according to the amendment. Even if he did have to do it, there is a vast range, as we all know, of gas appliances. One wonders—I understand the concerns about demarcation expressed by the noble Lord, Lord Haskel—whether it is practical to expect all emergency "shutters off' of gas—which after all is what we are talking about, in the first instance to make the gas supply within the premises safe—to carry all the vast range of fittings which might be required to mend gas appliances. Although I well understand what the noble Lord is getting at, and I sympathise with his objectives, there are practical difficulties.

Lord Milverton

My Lords, I hope my noble and learned friend the Minister will see whether there is some way in which he can take on board the amendment, because I believe that the noble Lord, Lord Haskel, has a point. With gas, it is important that the remedy is effected as efficiently and quickly as possible. There is something in the amendment. Anyone who has gas will be aware that it can be exasperating if one cannot obtain the necessary assistance immediately. I hope that my noble and learned friend will be able in some way to take on board or be sympathetic to the amendment.

Lord Fraser of Carmyllie

My Lords, I, too, share the concerns expressed by my noble friend Lord Skelmersdale about the terms of the amendment. I assume that, where the word "authorised" is used, what is intended to apply is authorisation as required by the Gas Installation and Use Regulations 1994, which require a person carrying out such work to be competent.

The more substantive approach I should like to take is to remind the House that we did debate a similar amendment in Committee. As a result of that debate we made some changes to the relevant provisions in the draft conditions for public gas transporters' licences. However, we remain of the view that we have the right balance of obligations on the public gas transporters relating to the provision of an emergency service.

Standard condition 18 now requires public gas transporters to undertake appropriate minor repairs to appliances in the course of fixing a leak so long as it can be done within half an hour and with parts costing less then £4. We have increased that figure from the current level of £2.50 applied by British Gas, in response to the comments we received on this matter.

Also in response to those comments we have extended the requirement on transporters to carry out such repairs as far as possible in such a way as to maintain the supply of gas so that it covers appliances used for cooking and heating. I should add also that the minor repairs referred to in standard condition 18 must be provided free of charge to all customers, not just those who are particularly vulnerable. In practice that will allow the majority of such leaks to be repaired effectively on the spot at no charge.

However, there is a great difference between effecting minor repairs, such as fixing leaks, and conducting more fundamental repairs to complex appliances. The skills and equipment needed are different. For public gas transporters to be obliged to provide a full appliance service capability would increase their costs and would mean that people would end up paying more. It is the consumer involved who should have to pay for the more complex work. Appliance repairs are available in a competitive installation market. There are about 47,000 firms around the country and safety is regulated by the regulations to which I referred, with a registration scheme for installers.

Given that large number of individuals, it would seem right that consumers should be able to choose who carries out the more complicated work as opposed to the simple repairs. In those cases where it is beyond the description of a small or minor repair, the transporter is required, by standard condition 18, to provide the customer with a list of persons in the locality who are appropriately qualified to carry out such repair work.

I hope that, in the light of the explanation and in the light of the changes that we have already made to the draft licence, the noble Lord will feel able to withdraw his amendment.

Lord Haskel

My Lords, I thank the Minister for that detailed reply. The improvements in the conditions of the licence, which the Minister mentioned, are welcome but they do not go far enough. Obviously, it is easy for someone who lives in London or in a big city to get an installer to come and fix their appliance but what about people who live in the country and in isolated places? The Minister has ignored the convenience of the consumer, because the consumer wants one person to come to fix the leak and the appliance.

I am sure that if the business becomes competitive, gas transporters will try to supply such a service. They will fall over themselves to supply customers with what they want. I believe that the Bill should contain a clause that encourages them to do so. We should not have a clause in the Bill that encourages some kind of demarcation arrangement, about which I spoke previously.

Secondly, our anxiety about safety was raised because there are rumours that the Minister's department is to close down or virtually disband the consumer safety unit. If that is the attitude of his department, we should be most anxious about safety. However, it is not my intention to divide the House on this matter, but I hope that the Minister will consider what I have said. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Fraser of Carmyllie moved Amendment No. 68:

Page 32, line 24, at beginning insert ("No officer shall be authorised by a public gas transporter, gas supplier or gas shipper to exercise any powers of entry conferred by this Schedule unless—

1. (a) the transporter, supplier or shipper has taken all reasonable steps to ensure that he is a fit and proper person to exercise those powers; or
2. (b) in cases of emergency, those powers are powers conferred by paragraph 20 above.

(1A)").

The noble and learned Lord said: My Lords, in speaking to Amendment No. 68, I shall speak also to Amendments Nos. 109, 110, 111, 112, 122, 123, 138 and 145. I beg to move.

Lord Ezra

My Lords, Amendment No. 68 deals with meter reading and I wish to raise one or two points. We had a considerable debate about the matter in Committee. Anxiety was expressed by myself and others that under the new arrangements not only would there no longer be a unitary meter reading service with persons who would have a common identification card and an office telephone number that could be used if anyone had any doubt, not only would there be a diversity of suppliers, but there could also be independent meter reading firms. Therefore, it was suggested, but regrettably not accepted by the Government, that there should be a scheme for the registration of people entitled to act as meter service providers who are not directly employed by the suppliers.

Although Amendment No. 68 is to be welcomed because it emphasises that the transporter, supplier or shipper has taken all reasonable steps to ensure that the meter reader is a fit and proper person to exercise those functions, it leaves open the question of the other operators. In view of the fact that a security issue is raised, apart from the issue of competence, will the Minister give further thought to that?

5.45 p.m.

Lord Peston

My Lords, I am slightly puzzled. I thought that Amendment No. 68 was not technical but that it was a new contribution by the Government in response to some of our anxieties. I certainly read it that way and I hope that I am not now being told that that is not the case. I am hoping to be told that the amendment really says something.

Lord Fraser of Carmyllie

My Lords, perhaps I was trying to go a little faster than was appropriate in the circumstances. I am happy to explain more fully why we have introduced this package of amendments which were intended to respond to the anxieties expressed not only by the noble Lord, Lord Ezra, but by other noble Lords and organisations outwith Parliament. They relate to those people who, under the Bill, will be able to exercise statutory rights of entry into peoples' homes.

Obviously, we take most seriously the security of the public. Having listened to the anxieties that have been expressed, we have decided to introduce a statutory requirement for licensees to take all reasonable steps to ensure that officers exercising rights of entry are fit and proper persons. Amendments Nos. 68 and 109 do that. That should provide added certainty that the interests of the consumers will be protected.

Amendment No. 138 seeks to meet another anxiety that was touched on by the noble Lord, Lord Ezra. It is the threat of bogus callers who seek to enter peoples' homes to commit crimes by pretending to be bona fide officers of a gas company. That can be a real problem and it is why we have been careful to make the provisions that we have in the licences so that the public can readily identify legitimate officers of a gas company and to avoid the misuse of badges and other authority.

However keen we are to regulate licensed companies in this regard, and no matter how much we regulate them, that cannot affect the behaviour of criminals. Amendment No. 138 would therefore make it an offence for: Any person who with intent to deceive … impersonates an officer … for the purpose of obtaining entry to any premises; or … makes any statement or does any act calculated falsely to suggest that he is an officer". That offence is to be liable on summary conviction to a level 4 fine, which is £2,500 at present.

Amendment No. 145 provides that a public gas transporter, supplier or shipper is permitted to delegate to an agent the function of authorising officer or servant of that agent. This delegation is to be in accordance with the terms of any written authority setting out the procedures to be followed by the agent. It is necessary for practical reasons if an agent is working for several suppliers. The licence holder will be obliged by the duties set out in Amendments Nos. 68 and 109 to ensure that the procedures are followed by his agents. The licence holder will thus remain responsible for ensuring that these officers are fit.

We have put in place detailed safeguards to protect consumers in relation to licensed gas companies with statutory rights of entry of their sub-contractors. We have also made a number of refinements to the safeguards in response to the anxieties expressed. I hope that I have answered all the points that were raised but if not I am happy to attempt to do so.

Lord Clinton-Davis

My Lords, I am sure that what the Minister has done is in the best interests of everyone. However, is there any real difference between the provisions of Amendment No. 138 and the present law? Would it not be a criminal offence to do all those things anyway? My criminal law is a little rusty these days but I wonder whether those situations are not met by the criminal law in any event.

Lord Fraser of Carmyllie

My Lords, it may indeed be something of a belt and braces job, with the common law of both England and Scotland covering such activity. I shall look at the matter. I am never keen to introduce to the statute book statutory offences when the common law is more than capable of handling them. I shall look at the matter again and, if the provision is unnecessary, I shall consider its deletion.

Lord Boyd-Carpenter

My Lords, will my noble friend amplify that answer a little? It appears that what is forbidden in Amendment No. 138 is already forbidden under the criminal law. I do not follow what improvement or change is being effected by the Bill.

Lord Fraser of Carmyllie

My Lords, as I have indicated, that may well be the case. The only particular feature is that it allows for a penalty of a fine not exceeding level 4. Clearly, the common law contains no such provision. From my recollection as a prosecutor, intent to deceive and impersonation matters are covered by the common law. But against the background which I have indicated to the noble Lord, we shall look again at that matter.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendment No. 69:

Page 32, line 43, at end insert ("in a consumer's premises").

The noble and learned Lord said: My Lords, this is a technical amendment. I beg to move.

On Question, amendment agreed to.

Schedule 3 [Other amendments of Part 1 of 1986 Act]:

Lord Fraser of Carmyllie moved Amendments Nos. 70 to 74:

Page 34, line 37, leave out ("7(11) above, section 10(8)") and insert ("10(8) or (11)").

Page 36, line 50, leave out ("(c)") and insert ("(b)").

Page 37, line 21, at end insert ("and the extent to which it is reasonable to expect that the transporter will recover that expense from elsewhere").

Page 37, line 21, at end insert— ("( ) If and to the extent that regulations made by the Director with the consent of the Secretary of State so provide, subsection (10) above shall have effect as if—

1. (a) the reference in paragraph (d) to the laying of a new main, the enlarging of an existing main or the construction or enlarging of any other works required for the conveyance of gas included a reference to a new main which had previously been laid, an existing main which had previously been enlarged or any other works required for the conveyance of gas which had previously been constructed or enlarged;
789
2. (b) the reference to the expense to be incurred in laying or enlarging the main or constructing or enlarging the other works included a reference to the expense which had been so incurred; and
3. (c) the reference to the extent to which it is reasonable to expect that the transporter will recover that expense from elsewhere included a reference to the extent to which the transporter had been able so to recover that expense.").

Page 37, line 33, leave out ("and a declaration under this") and insert— ("(13) A public gas transporter shall make a declaration under subsection (12) above in respect of each pipe falling within that subsection which is fit for the purpose of being a relevant main; and a declaration under that").

The noble and learned Lord said: My Lords, these are technical amendments. I beg to move.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 75 to 98:

Page 38, line 10, at beginning insert ("Except in prescribed cases,").

Page 38, line 16, after ("section") insert (", or so determined by another public gas transporter and adopted by the transporter in accordance with such regulations").

Page 38, line 19, leave out ("the declared calorific value") and insert ("declared calorific values").

Page 38, line 24, at end insert ("— (a)")

Page 38, line 27, leave out ("and, if the Director so determines, containing") and insert ("or (b) if regulations under this section so provide, the combustion of one kilogram of the gas, containing in either case, if the Director so determines,").

Page 38, line 31, after ("means") insert ("a").

Page 38, line 33, at end insert (", or so declared by another public gas transporter and adopted by the transporter in accordance with such regulations").

Page 38, line 33, at end insert— ("( ) Regulations under this section may make provision as to the manner in which prescribed information with respect to the making of calculations in accordance with the regulations is to be made available to other licence holders and to the public.").

Page 38, line 37, leave out from ("transporters") to second ("at") in line 39 and insert ("to be made on the basis of samples of gas taken at such places or premises, at such times and in such manner as the Director may direct; ( ) for requiring such determinations to be made at such places or premises,").

Page 38, line 40, at end insert— ("( ) as to the manner in which the results of such determinations are to be made available to other licence holders and to the public;").

Page 38, line 47, leave out from ("them") to end of line 5 on page 39 and insert ("and ( ) for requiring the results of such tests to be notified to the Director or to any person appointed under section 13(1) below, and to be made available to other licence holders and to the public.").

Page 39, leave out lines 8 to 22 and insert— ("(a) for requiring declarations of calorific values of gas conveyed by public gas transporters to be made at such times and in such manner as the Director may direct; (b) as to the times when such declarations are to take effect, and as to the manner in which the calorific values declared are to be made available to other licence holders and to the public; (c) for imposing requirements on public gas transporters as to the correlation between—

1. (i) the calorific values of the gas conveyed by them for any period; and
2. (ii) the calorific values declared by them for that period;

(d) for requiring public gas transporters to carry out tests of gas for the purpose of ascertaining whether they are complying with the requirements of regulations made by virtue of paragraph (c) above; (e) for requiring such tests to be carried out at such places or premises, at such times and in such manner as the Director may direct; and (f) for requiring the results of such tests to be notified to the Director or to any person appointed under section 13(1) below, and to be made available to other licence holders and to the public.").

Page 39, line 28, at end insert ("or section 13 below").

Page 39, line 32, leave out ("required") and insert ("compelled").

Page 39, line 43, leave out ("under") and insert ("made by virtue of subsection (3)(b) of").

Page 39, line 46, leave out ("in the case of which") and insert ("conveyed by public gas transporters where").

Page 39, line 49, leave out ("gas is of or above the declared calorific value") and insert ("transporters are complying with the requirements of regulations made by virtue of subsection (4)(c) of that section").

Page 39, line 52, leave out ("that section or regulations made under it") and insert (", or under regulations made under, this section or that section").

Page 40, line 5, after ("places") insert ("or premises").

Page 40, line 6, leave out ("and").

Page 40, line 10, at end insert— ("(c) for requiring samples of gas to be taken by public gas transporters at such places or premises, at such times and in such manner as the Director may direct; and (d) for requiring samples of gas so taken to be provided by public gas transporters, for the purpose of carrying out such tests, at such places or premises, at such times and in such manner as the Director may direct.").

Page 40, line 15, leave out ("for") and insert ("as to").

Page 40, line 21, at end insert (" or section 12 above").

Page 40, line 36, leave out from ("functions") to the end of line 38 and insert ("under section 12 above or this section").

The noble and learned Lord said: My Lords, these are technical amendments. I beg to move.

On Question, amendments agreed to.

Lord Haskel moved Amendment No. 99:

Page 40, leave out line 48 and insert— ("8. For section 14 of the 1986 Act the following section shall be substituted—

"Obligation to publish prices and other services

14.—(l) The principal prices to be charged to domestic consumers for the supply of gas and the provision of services (hereafter referred to as Terms of Supply) shall be published in such manner as in the opinion of the supplier, after consultation with the Director and the Council, will secure adequate publicity for them.

(2) The manner in which Terms of Supply shall be published will be such as to enable domestic gas consumers or potential consumers, accurately to compare prices and services when choosing a supplier.

(3) Suppliers will send copies of their Terms of Supply to the Director and the Council not later than the time of publication or announcement or implementation.

(4) In this section "services" may be taken to include services the supplier is obliged to provide in accordance with standard licence conditions and such other services as he may choose to provide." ").

The noble Lord said: My Lords, this amendment obliges gas suppliers to publish their prices for gas and other services to domestic consumers or potential consumers with adequate publicity for them. That is so that domestic consumers can compare prices when choosing a supplier. Many arguments were put in Committee about the fact that if there is no transparency and proper information regarding prices, the consumer is unable to make an informed choice and competition becomes a sham. As we have been reminded several times, the purpose of the Bill is to introduce competition.

The amendment was moved in Committee by my noble friend Lord Clinton-Davis. It was supported by many other noble Lords, and the Minister said that he would consider the points made. Sadly, he has not been moved by our arguments.

One of the advantages of a long summer break is that we have had time to re-read the reasons why the Minister felt that it is not necessary to have an obligation on the face of the Bill for suppliers to publish their prices. I found three errors in his reasoning.

First, at col. 826 of Hansard the Minister, the noble Earl, Lord Ferrers, said that price schedules are provided in draft standard condition 3 of the supply licence. He said that that is just as binding on suppliers as if it were in the Bill. That is incorrect. The Gas Bill can be amended only with parliamentary consent, whereas a licence condition can be amended by the director general with the consent of the Secretary of State. I feel that the requirement to publish price information in a proper manner is so crucial to consumer choice that it should be contained within a document which can be changed only by Parliament and not left to the discretion of the director general.

The second point on which I take issue with the Minister is referred to at col. 827 of Hansard where he says that publishing prices in the long term could work against the benefit of consumers because consumers may wish to negotiate their prices as in the industrial market. To compare the needs of the industrial market with those of the domestic market is disingenuous. Of course industrial users will wish to negotiate prices with suppliers and keep secret the result of those negotiations so that competitors cannot work out their production costs. To suggest that that applies also to domestic consumers is ridiculous.

The third error in the Minister's response is to be found at col. 828. He implies that the published list of prices will not be movable or negotiable. That is totally wrong. Of course suppliers will be able to offer volume discounts, special deals and other offers. That is the nature of competition. But that competition will not exist if the public do not know what are the prices and cannot make comparisons as easily as they can in relation to petrol and other products. We must ensure that the consumer is treated fairly. I beg to move.

Lord Skelmersdale

My Lords, having given the noble Lord, Lord Haskel, what my father would undoubtedly have called a slap in the belly with a cold wet fish on the previous amendment, I offer my unqualified support for his arguments on this occasion.

As I have made clear throughout the Bill, competition in the telecommunications industry would not have happened at all but for total transparency of prices. The domestic telecommunications market is analogous with the domestic gas market. That is the first point.

The second point is that in the early days of the freeing-up of competition in the gas contract market—the largest suppliers—British Gas was operating with what I can only describe as one hand tied behind its back. It alone of all the competitors was obliged by law to publish its prices. Therefore, of course there was unfair competition. There is no earthly justification for that to happen in the domestic market.

Lord Ezra

My Lords, I support the amendment. We had a lengthy debate about this in Committee. The Government said that they would think about this and it is regrettable that they have not tabled an amendment. The fact that under the terms of the licence the suppliers will be obliged to publish prices is not sufficient because, as the noble Lord, Lord Haskel, rightly pointed out, prices may be altered by the regulator without any parliamentary debate.

This is a matter of considerable importance. If we are to have a fair competitive situation in the supply of domestic gas, we must have total price transparency. Individual consumers are not in the position of commercial or industrial enterprises which have skilled negotiators at their disposal who can obtain a list of all the suppliers, summon them to their office and go through with them the terms and conditions under which they are prepared to sell. The individual domestic consumer will not have the time or the skill to do any of that, just as the individual motorist, if the prices of petrol were not visible on the forecourt, would not be able to tell, without wasting a great deal of time, where he should be going for his petrol if he wished to obtain it at the most attractive price.

I cannot see why the Government are reluctant on the point. They said that they would look again at the matter. I hope that we have persuaded the noble and learned Lord, who has been so helpful in the discussions so far, and that, in this matter too, he will see the force of the argument from all sides of the House.

6 p.m.

Lord Fraser of Carmyllie

My Lords, if the only issue here was that of publishing prices I could see some of the force of the argument that has just been put forward by the noble Lord, Lord Ezra. However, it is not just a question of a consumer's freedom to negotiate. The licence conditions require suppliers not only to publish prices but also to supply according to them. They can only supply according to the published terms; for example, they could not offer consumers a special deal to suit their circumstances or to meet a competitor's approach.

Clearly I take the point that the individual domestic consumer is not like a single large industrial user; indeed, their negotiating muscle is not to be equated. However, your Lordships will be aware of the type of special arrangement that such firms as John Lewis adopt. They say that, if you can find a competitor who provides the goods at a price lower than the one they charge, then they will adjust their price to meet it. Under the existing condition arrangements, that would not be possible. Even if the company wished to do so, it could not offer a special deal; in other words, it could not make such a special arrangement. I believe that that simple example demonstrates that there is a potential risk that, far from operating to the benefit of the consumer, if there is no prospect of loosening up the provision at some time it could operate against the interests of the consumer.

Therefore, we want to avoid ruling out the possibility that at some point in the future it might be desirable for consumers to negotiate a deal with a supplier suited to their particular needs. I am not yet confident that that will definitely happen. However, I do not believe that it would be prudent to rule out the possibility now before we have seen how the market will develop.

I should like to reiterate the fact that the Government consider it important—and we are in agreement on this—that at least at the early stages of the market there should be published prices. That is why price schedules are provided for in the draft standard condition 3 of the supply licence. That would be quite as binding on suppliers as if it were in the Bill. I see that the noble Lord wishes to intervene. I give way.

Lord Clinton-Davis

My Lords, I am much obliged. I believe that we should welcome what the Minister has just said, but I am rather confused on the matter. The noble and learned Lord says that the situation would be inflexible if we were to import the provision into the Bill, but if in fact prices are published so that a comparison can be made along the lines mentioned by my noble friend and the noble Lord, Lord Ezra, surely there is nothing to stop negotiation taking place thereafter. Would it not be possible for someone to say, "I know that I can get a better deal from someone else"? Indeed, one could negotiate on that basis.

Lord Fraser of Carmyllie

No, my Lords; that is not the way that it is arranged at present. That is why we want to allow for the potential of greater flexibility in the future. There is not much point in having a duty simply to publish a set of prices if one is not actually under an obligation to supply at that price. That is where the difficulty arises. We want to allow for some flexibility in the future if the market develops in that way. I have indicated that I accept that there is no direct and wholly apt comparison to be drawn with the industrial gas market. Nevertheless, where that requirement is not in place, gas prices are very much lower.

As I understand it, the principal concern of the noble Lord, Lord Haskel, is that he understood that we were at the outset requiring that the provision of a price schedule should indeed appear within the standard conditions. However, the noble Lord was concerned that, because it would not be on the face of the Bill, it might be removed by the director without Parliament having had the opportunity to have its say. I should tell the noble Lord that any proposal by the director to remove the standard condition requiring publication of prices would be subject to the Secretary of State's veto and could only be carried out after public consultation.

If the noble Lord does not like my argument and does not believe that the opportunity for greater flexibility at some indefinite point in the future is one to which we ought to have regard, he can be reassured that, as such changes take place, the price will be published. It will be there in the standard conditions and it could be vetoed by the Secretary of State. However, I believe that the noble Lord's particular concern is that such a change might taken place during a Recess without Parliament knowing anything about it. I hope that I can reassure the noble Lord by confirming that we believe that Parliament ought to have the opportunity to consider if it wishes any proposal to remove the obligation to publish prices. In practice, that means the Secretary of State would wish to inform Parliament of any such proposal and that his veto would be used so as to prevent such a change being made when Parliament was not sitting. With that explanation of the arrangement in the standard condition as the changes take place, and also with the statement on behalf of the Secretary of State, I hope that the noble Lord will feel reassured.

Lord Haskel

My Lords, I thank the Minister for that reassurance. However, I must confess that I am somewhat confused. The noble Lord, Lord Skelmersdale, drew a comparison with the telecommunications business as regards price lists. As I understood the Minister, once a gas supplier has published its prices it cannot offer any special deals. However, if it is to be similar to the telecommunications business, I should point out that the latter is offering special deals all the time; for example, there are special deals depending on what time one telephones and how often one telephones and special deals regarding calls to Europe or the United States. I cannot imagine that the same will not apply to the gas business because that is one of the few ways in which gas suppliers will be able to compete with one another.

I accept the Minister's assurances that, if there is any change, it will only take place with the Minister's approval and that that will not be done unless Parliament is sitting. I thank the noble and learned Lord for that assurance, but perhaps another way of dealing with the matter—and one which will satisfy everyone—would be for the Government to put the provision for the publication of prices into the licence rather than into the legislation. Perhaps, therefore, the Minister would consider dealing with the matter by including the amendment in a subsection of the Bill which would allow for this part of the legislation to fall by order. That would be no more bureaucratic than the process that he suggested. It would deal with the modifications of the standard licence conditions and satisfy the consumer concerns. I hope that the Minister will give the suggestion some consideration. The proposal came from an organisation which is quite concerned about the matter. Can the Minister reply on that latter point?

Lord Fraser of Carmyllie

My Lords, I shall certainly consider what the noble Lord has said and came back to him, but he does place me in somewhat of a difficulty. I have given him as clear an indication as I can why I believe it is right that this should be a condition of the licence. I hope that I have given a clear and unequivocal statement of what the intention of the Secretary of State would be should the director at some unknown point in the future decide that it would be appropriate to remove that qualification.

Lord Haskel

My Lords, I thank the Minister for giving those strong assurances. He will consider what has been said and I shall consider what he has said. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Fraser of Carmyllie moved Amendments Nos. 100 to 105:

Page 41, line 24, at end insert ("by regulations").

Page 41, line 28, at end insert ("so").

Page 41, line 35, after ("State,") insert ("by regulations").

Page 41, line 41, at end insert ("so").

Page 42, line 8, after ("Regulations") insert ("under this section").

Page 43, line 1, at end insert ("under this section").

The noble and learned Lord said: My Lords, these are technical amendments. I beg to move Amendments Nos. 100 to 105 en bloc.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 106 to 108:

Page 45, line 3, leave out ("signal") and insert ("signify").

Page 45, line 5, at end insert ("to the premises" ").

Page 45, line 16, leave out from ("for") to end of line 18 and insert ("paragraphs (a) and (b) there shall be substituted the words "any reference to a gas operator were a reference to the relevant authority" ").

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 109 to 112:

Page 45, line 33, at end insert— ("(11) Except in cases of emergency, no officer shall be authorised by a public gas transporter to exercise any powers of entry conferred by regulations under this section unless the transporter has taken all reasonable steps to ensure that he is a fit and proper person to exercise those powers." ").

Page 46, line 5, after ("(7)") insert ("and (11)").

Page 46, line 10, leave out ("and").

Page 46, line 13, at end insert ("and (d) the reference in subsection (11) of that section to regulations under that section were a reference to regulations under this section.").

The noble and learned Lord said: My Lords, in speaking to Amendment No. 68, I spoke also to Amendments Nos. 109 to 112. I beg to move Amendments Nos. 109 to 112 en bloc.

On Question, amendments agreed to.

Lord Fraser of Carmyllie had given notice of his intention to move Amendment No. 113.

Page 48, leave out lines 46 to 48 and insert ("the difference between—

1. (a) the cost of carrying out the modifications (including a reasonable element of profit); and
2. (b) any contributions towards that cost which the transporter will or may be able to recover from other persons."").

The noble and learned Lord said: My Lords, this amendment has been incorrectly drafted. I shall not move the amendment.

[Amendment No. 113 not moved.]

Lord Fraser of Carmyllie moved Amendments Nos. 114 to 120:

Page 50, line 10, after ("above") insert ("the").

Page 52, line 6, leave out ("a standard condition") and insert ("standard conditions").

Page 52, line 7, leave out ("its") and insert ("their").

Page 54, line 18, after first ("above") insert ("the").

Page 54, line 35, leave out ("a standard condition") and insert ("standard conditions").

Page 54, line 36, leave out ("its") and insert ("their").

Page 54, line 41, leave out paragraph 25 and insert— ("25. For section 27 of the 1986 Act there shall be substituted the following section—

"Modification by order under other enactments.

27.—(1) Where in the circumstances mentioned in subsection (3) or (4) below the Secretary of State by order exercises any of the powers specified in Parts I and II of Schedule 8 to the Fair Trading Act 1973 or section 10(2)(a) of the Competition Act 1980, the order may also provide for the modification of—

1. (a) the conditions of a particular licence; or
2. (b) the standard conditions of licences under section 7 above, licences under subsection (1) of section 7A above or licences under subsection (2) of that section,

to such extent as may appear to him to be requisite or expedient for the purpose of giving effect to or of taking account of any provision made by the order.

(2) Where at any time the Secretary of State modifies under subsection (1)(b) above the standard conditions of licences under section 7 above, licences under subsection (1) of section 7A above or licences under subsection (2) of that section, he—

1. (a) shall also make (as nearly as may be) the same modifications of those conditions for the purposes of their incorporation in licences under that section or, as the case may be, that subsection granted after that time; and
2. (b) may, after consultation with the Director, make such incidental or consequential modifications as he considers necessary or expedient of any conditions of licences under that provision granted before that time.

(3) Subsection (1) above shall have effect where—

1. (a) the circumstances are as mentioned in section 56(1) of the said Act of 1973 (order on report on monopoly reference), or in section 10(1) of the said Act of 1980 (order on report on competition reference); and
2. (b) the monopoly situation exists in relation to, or (as the case may be) the anti-competitive practice relates to—
   1. (i) the carrying on of activities authorised or required by a licence; or
   2. (ii) the storage of gas on terms which have been, or could have been if he thought fit, determined by the holder of a licence under section 7 above.

(4) Subsection (1) above shall also have effect where—

1. (a) the circumstances are as mentioned in section 73(1) of the said Act of 1973 (order on report on merger reference); and
2. (b) at least one of the two or more enterprises—
   1. (i) which ceased to be distinct enterprises; or
   2. (ii) in the application of that provision as it has effect by virtue of section 75(4)(e) of that Act, which would cease to be distinct enterprises,
   was or, as the case may be, is engaged in the carrying on of activities authorised or required by a licence.

(5) Where at any time the Secretary of State modifies standard conditions under subsection (2)(a) above for the purposes of their incorporation in licences granted after that time, he shall publish those modifications in such manner as he considers appropriate.

(6) In this section expressions which are also used in the said Act of 1973 or the said Act of 1980 have the same meanings as in that Act." ").

On Question, amendments agreed to.

Lord Fraser of Carmyllie Moved Amendment No. 121:

Page 57, line 26, leave out ("or (3)") and insert (", (3) or (13)").

The noble and learned Lord said: My Lords, this amendment is consequential to Amendment No. 74. I beg to move.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 122 and 123:

Page 57, line 26, after ("or (5),") insert ("18(11),").

Page 57, line 28, leave out ("and 18(5)") and insert (", 18(5) and 26(1)").

The noble and learned Lord said: My Lords, in speaking to Amendment No. 68, I spoke also to Amendments Nos. 122 and 123. I beg to move Amendments Nos. 122 and 123 en bloc.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 124 to 127:

Page 59, line 30, leave out ("subsection") and insert ("subsections").

Page 59, line 34, at end insert— ("(3A) Standards may be determined either as respects the provision of gas supply services generally or as respects the provision of such services to customers of a particular class or description." ").

Page 60, line 28, at end insert— ("(2) After subsection (2) of that section there shall be inserted the following subsection— (3) Where the standards of performance mentioned in subsection (1) above relate to the provision of gas supply services to customers of a particular class or description, the reference in that subsection to the supplier's customers shall be construed as a reference to such of his customers as are of that class or description." ").

Page 60, line 33, after ("supplier") insert ("who is authorised to supply gas to domestic customers and whose licence incorporates the standard conditions" ").

On Question, amendments agreed to.

6.15 p.m.

Lord Fraser of Carmyllie moved Amendment No. 128:

Page 60, line 45, at end insert ("(including in particular the storage of gas, the provision and reading of meters and the provision of pre-payment facilities)" ").

The noble and learned Lord said: My Lords, in moving Amendment No. 128, I wish to speak also to Amendments Nos. 130 and 132. These are technical amendments. I beg to move.

On Question, amendment agreed to.

The Earl of Caithness moved Amendment No. 129:

Page 61, line 3, at end insert— ("( ) After subsection (2) of that section there shall be inserted the following subsection— (2A) When taking any decision or action in the exercise of the functions assigned to him under this Act, the Director shall specify to persons materially affected the reasons for that decision or action in sufficient detail to enable such persons to plan for the future with a reasonable degree of assurance; and this subsection shall be construed to cover decisions to take no action." "").

The noble Earl said: My Lords, it has been clear this afternoon that the Government have made a great effort to meet the concerns which many of us raised in Committee. I know that I am not the only one of your Lordships who is grateful for the movement by my noble friend. I thank him for that. Yet again this amendment is one where the Government have responded. My noble and learned friend has tabled Amendment No. 134 so there is no need for me to rehearse the arguments. I only wish to comment on the word "may" in the fifth line of his Amendment No. 134. Would he like to use the word "shall" rather than "may"? I beg to move.

Lord Peston

My Lords, we have a difficulty here because we are only allowed to speak once on Report, but I believe the noble Earl can reply to a question. As the noble Earl, Lord Caithness, is aware, I am totally sympathetic to his amendment. Is he saying that he is happy that the Government's Amendment No. 134 covers satisfactorily the ground that he had in mind in his amendment?

The Earl of Caithness

My Lords, I believe it certainly covers most of my concerns. The points of difference are not ones that I would wish to quibble over at this stage. I therefore hope that my noble and learned friend will speak to Amendment No. 134 now.

Lord Peston

My Lords, I do not wish to delay matters. The principle behind the noble Earl's amendment is one which he knows I strongly support. I of course will always support him as regards replacing "may" with "shall". I hope that the Minister will be able to reassure him, and therefore me, that he has gone a reasonable way down the road of removing what we call regulatory risk.

Lord Fraser of Carmyllie

My Lords, I am grateful to my noble friend for his kind words. I hope that I can explain to him that this is not the traditional dispute over "may" and "shall" but reflects the present position and why we would not wish to be under an absolute duty to make these regulations. Both my noble friend and the noble Lord, Lord Peston, suggested in Committee that the director ought to have an obligation to consult and give reasons. The Government resisted that because they were concerned that a blanket obligation could be misused by regulated companies and more particularly by regulated companies' lawyers to gum up the regulatory process. We remain of the view that a general duty in this area of the type which my noble friend has proposed would not be appropriate. Having considered the comments of both the noble Lord and my noble friend we have prepared, as he appreciates, Amendment No. 134 which we hope picks up the importance of consultation and reason giving without suffering the disadvantages to which I have alluded. An order under this provision, if needed, could be tailored to the precise descriptions of decisions which were giving rise to a problem. The possibility that the duty might lead to an over legalistic regulation is a matter which would need to be considered in framing any order.

The Director General of Gas Supply has followed an open, pro-competitive and consultative approach in reaching regulatory decisions. In the light of her existing policy on this, we would not envisage a need to make an order under this provision. However, the power is available and could be used if the situation changed. It is for that reason that I am not immediately attracted to the idea of replacing "may" with "shall". It is a back-up provision, but I can assure my noble friend that we are aware of his concerns and have so put matters in place that if it proved to be necessary the opportunity to act is there.

The Earl of Caithness

My Lords, I am grateful to my noble and learned friend for explaining why he has worded his amendment in the way that he has. I sympathise with him. He is a lawyer and I would not wish to reduce the workload of some of his compatriots in these areas. It is probably wise at this stage to retain the word "may". A power is available to be used should reasons not be given. Not to give reasons would of course be a great hindrance, as we explained in Committee. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Fraser of Carmyllie moved Amendment No. 130:

Page 61, line 6, leave out ("subsection (4) of that section") and insert ("that subsection").

The noble and learned Lord said: My Lords, in speaking to Amendment No. 128, I hope that I spoke also to Amendment No. 130. If I did not I should add that it is a technical amendment. I beg to move.

On Question, amendment agreed to.

Lord Clinton-Davis moved Amendment No. 131:

Page 61, line 12, at end insert— ("( ) After that subsection there shall be inserted the following subsection— ( ) The Director shall have power to take action on behalf of consumers to challenge in the appropriate court the terms of a contract under which gas is supplied to consumers which appear to the Director, to the Director-General of the Office of Fair Trading or to the Gas Consumers' Council to be unfair within the meaning of the Unfair Terms in Consumer Contracts Regulations 1995." ").

The noble Lord said: My Lords, Amendment No. 131 stands in my name and in the names of my noble friend Lord Peston and the noble Lord, Lord Ezra.

The amendment concerns a matter which I originally broached on Second Reading. I believe it to be an important issue. I hope that the gap between the Government and ourselves on this issue of principle is not unbridgeable.

We believe that in transposing the directive on this issue in the Unfair Terms in Consumer Contract Regulations 1994 the Government deliberately chose to take a very restrictive view about the directive, in contrast with the view taken by most other member states. We take the view that it is right that the consumer should be enabled to have much wider access to the courts to enforce rights and pursue remedies through representative actions. The Government believe that that goes too far and ought to be limited.

I do not need to rehearse what the Government seek to do here. The Minister is well aware of the point that I made, which was further dealt with by my noble friend at the first Sitting of the Committee stage.

What happened in another place was unfortunate. At that time the Minister seemed to rule out any suggestion of that kind out of hand. He said simply, in effect, that the Government had decided against the amendments that were proposed. He said: We believe that the present remedies available via the DOFF are appropriate. We do not think that other bodies should be able to exercise those remedies".—[Official Report, Commons, Standing Committee A, 27/4/95; col. 322.] No rationale was ever put forward. It was that which caused us to question the Government's views and their bona fides on the issues.

We believe that, unless the amendment we now propose were to be accepted, the DGFT would not necessarily be the right person to initiate a representative action. I argued previously that Ofgas and the Gas Consumers Council would receive substantial numbers of complaints from consumers and would therefore be in an advantageous position to pursue those remedies in the courts. The difficulty with the OFT is that it is not designed to defend the interests of consumers but to adopt a vigilant, independent and objective balance between industry and the consumer. Clearly, on that basis, the DGFT is not in the best position to pursue such remedies.

I hope that the Minister will recognise that in tabling the amendment we are saying that the Government may not necessarily be right about this matter. We know that litigation is pending through judicial review. On the previous occasion the Minister said that it was inappropriate to deal with the matter piecemeal. That reiterates the argument that was made previously. This is the vehicle we are now considering. We take the view that the Minister would not invalidate the Government's position if he were to adopt the amendment. If the amendment were accepted the director would still have the power to take the action, but the other bodies would be able to help the director to determine whether something was unfair, and the director would then take action.

I believe that we have to be more specific than the Government have been. I do not believe that our proposal for dealing with the matter is ideal. I should like to go further. We have tried to offer the Government an opportunity to meet us half way on this issue. That is what I hope the Government will be prepared to do.

I repeat that we should like to go very much further. We believe that the original directive was designed to enable governments to go much further and that the restrictive attitude adopted by the Government is wrong. However, there it is. I hope that the Minister will regard what we propose here as a positive way of meeting his case without trespassing on matters which are currently seized of by the courts, because it would not invalidate the Government's contentions in any way in relation to the judicial review. I hope that the Minister will accept that it is a useful way of trying to get round that particular problem. I beg to move.

Lord Fraser of Carmyllie

My Lords, I fear that I must disagree with the noble Lord. He alluded to the fact that an action for judicial review is under way at the present time. I appreciate that it is his intention to attempt to approach this matter in such a way that it would not invalidate the Government's position in that action of judicial review. However, I cannot agree with him that this approach would not carry that risk.

As the noble Lord is aware, we are confident that the directive has been correctly implemented by the Government. As he said, there are those who do not agree that we have done that and have accordingly raised proceedings for judicial review. Against the background of an action for judicial review which has not yet been heard, I do not believe that we can look further at the proposal pending the outcome of that case.

More generally, even if we felt in a position to do that we certainly would not want to approach the issue of the implementation of the directive in a piecemeal manner solely for the gas industry by amending the Gas Act. I recognise that the noble Lord is concerned that the vehicular argument, as he described it, should not be used too regularly, but it seems to me to be appropriate in this context.

I do not believe that I can say much more on the subject so long as legal proceedings are pending before the courts.

Lord Clinton-Davis

My Lords, I understand what the Minister says. I am disappointed that he feels that it would so embarrass the Government in those proceedings that he cannot accept the amendment. I think that he is wrong about that. However, he has made the decision of the Government quite clear. When it comes to vehicles, I hope that the Government's vehicle that is currently careering through the courts meets with an untimely end.

Can the Minister indicate when the proceedings are likely to be heard? Is there any indication of that?

Lord Fraser of Carmyllie

My Lords, I am never entirely confident about my understanding of the detail of English legal procedures. I understand that it has not been possible to put the action through the accelerated procedure. It is likely to be heard at the beginning of next year.

Lord Clinton-Davis

My Lords, I hoped that the Minister would say that the accelerated procedure would apply, particularly in the light of our discussions here. However, that is not to be the case. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

6.30 p.m.

Lord Fraser of Carmyllie moved Amendment No. 132:

Page 62, leave out lines 21 to 24 and insert— ("(a) such activities as are mentioned in section 5(1) above; and (b) activities ancillary to such activities as are so mentioned (including in particular the storage of gas, the provision and reading of meters and the provision of pre-payment facilities).").

The noble and learned Lord said: My Lords, in moving Amendment No. 128, I spoke to Amendment No. 132. I beg to move.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendment No. 133:

Page 63, line 30, at end insert—

("Functions with respect to gas measuring equipment etc.

After section 36A of the 1986 Act there shall be inserted the following section—

"Functions with respect to gas measuring equipment etc.

36B.—(1) If and to the extent that the Secretary of State so directs, the functions of the Secretary of State under section 6 of the Weights and Measures Act 1985 (testing of standards and equipment) so far as relating to—

1. (a) any article used or proposed to be used as a standard of a unit of measurement in relation to gas;
2. (b) any measuring equipment, or other metrological equipment, for use in relation to gas; or
3. (c) any article for use in connection with any such equipment,

shall be exercisable by the Director concurrently with the Secretary of State; and references in that section to the Secretary of State shall be construed accordingly.

(2) Any sums received by the Director by virtue of this section shall be paid into the Consolidated Fund." ").

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendment No. 134:

Page 64, line 43, at end insert—

("Duty to consider representations and give reasons

. After section 38 of the 1986 Act there shall be inserted the following section—

"Duty to consider representations and give reasons.

38A—(1) The Secretary of State may by order exercise any one or more of the powers conferred by subsections (2) to (4) below.

(2) This subsection confers power to provide that, before the Director makes a specified decision in relation to a licence holder, the Director—

1. (a) shall give to the licence holder a written notice stating—
1. (i) that he is considering making the decision and the reasons why he is considering doing so; and
2. (ii) that the licence holder may, within a period specified in the notice, make written representations to him or, if the licence holder so requests, make oral representations to a person appointed by him for the purpose; and
2. (b) shall consider any representations which are duly made and not withdrawn.

(3) This subsection confers power to provide that, where the Director makes a specified decision in relation to a licence holder, the Director shall as soon as practicable give to the licence holder a written notice explaining why it appeared to him to be appropriate to make the decision.

(4) This subsection confers power to provide that, where a specified decision made or proposed to be made in relation to a licence holder will or may materially affect any specified person, any provision made by virtue of subsection (2) or (3) above shall, with any specified modifications, apply in relation to that person.

(5) Nothing in any order made under this section shall require the Director to disclose any information the disclosure of which he considers would or might seriously and prejudicially affect the interests of a particular individual or body of persons, whether corporate or unincorporate.

(6) An order under this section—

1. (a) may make different provision in relation to different cases or different circumstances; and
803
2. (b) shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(7) In this section—

• 'decision' means any decision under this Part, or under a condition of a licence, other than a decision to make a provisional order under section 28 above;
• 'specified', in relation to an order under this section, means specified in the order or of a description so specified;

and references to a licence holder include references to an applicant for a licence." ").

The noble and learned Lord said: My Lords, I spoke to Amendment No. 134 when speaking to Amendment No. 129. I beg to move.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 135 to 137:

Page 65, line 10, leave out ("section 38 above") and insert ("subsection (1) of section 38 above, which is required by or has been obtained in pursuance of a notice under subsection (1A) of that section").

Page 65, line 14, leave out from ("is") to end of line 17 and insert ("required by the other licence holder for purposes connected with the carrying on of relevant activities. (1B) In subsection (1A) above 'relevant activities', in relation to a licence holder, means—

1. (a) activities which he is authorised by his licence to carry on; and
2. (b) in the case of a public gas transporter, such activities as are mentioned in section 7(1)(b) and (c) above." ").

Page 65, line 21, leave out ("(2) and") and insert ("to").

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendment No. 138:

Page 65, line 22, at end insert—

("Making of false statements etc.

48A. After subsection (1) of section 43 of the 1986 Act (making of false statements etc) there shall be inserted the following subsection— (1A) Any person who with intent to deceive—

1. (a) impersonates an officer of a public gas transporter, gas supplier or gas shipper for the purpose of obtaining entry to any premises; or
2. (b) for that purpose makes any statement or does any act calculated falsely to suggest that he is an officer, or an authorised officer, of such a transporter, supplier or shipper,

shall be guilty of an offence and liable on summary conviction to a fine not exceeding level 4 on the standard scale."").

The noble and learned Lord said: My Lords, in moving Amendment No. 68, I spoke to Amendment No. 138. I beg to move.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 139 to 142:

Page 66, line 9, after ("regulations)") insert— ("(a) for paragraph (aa) there shall be substituted the following paragraph— (aa) provide for anything falling to be determined under the regulations to be determined—

1. (i) by the Director or by such other person as may be prescribed by the regulations; and
804
2. (ii) in accordance with such procedure and by reference to such matters and to the opinion of such persons as may be so prescribed;" and.

(b) in paragraph (b),").

Page 66, line 45, leave out from (""prescribed",") to end of line 46 and insert ("for the words "(except in section 33A above)" there shall be substituted the words "made, unless the context otherwise requires, by the Secretary of State"").

Page 66, line 50, at end insert— ("( ) the definition of "regulations" shall cease to have effect;").

Page 67, line 1, leave out ("after the definition of "regulations"") and insert ("immediately before the definition of "subsidiary"").

The noble and learned Lord said: My Lords, in moving Amendment No. 100, I believed that I had spoken to these amendments. I have been corrected; I have no doubt about the accuracy of the correction. I beg to move Amendments Nos. 139 to 142. They are technical amendments which should have been spoken to when I moved Amendment No. 100.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 143 and 144:

Page 67, line 2, leave out ("definition") and insert ("definitions").

Page 67, line 6, after ("pipe;") insert— ("'storage', in relation to gas, means storage in, or in a facility which is connected (directly or indirectly) to, a pipe-line system operated by a public gas transporter;" ").

The noble and learned Lord said: My Lords, in moving Amendments Nos. 143 and 144, I speak also to Amendments Nos. 146 to 148. They are all technical amendments.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendment No. 145:

Page 67, line 7, at end insert— ("(1A) After subsection (1) of that section there shall be inserted the following subsection— (1A) In this Part any reference to an officer authorised by any person includes, in relation to an officer who is an officer or servant of an agent of that person, an officer who, in accordance with the terms of any written authority given by that person to the agent, is authorised by the agent on behalf of that person."").

The noble and learned Lord said: My Lords, I spoke to Amendment No. 145 when moving Amendment No. 68. I beg to move.

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 146 to 148:

Page 67, line 8, leave out from ("for") to end of line 9 and insert ("paragraphs (a) and (b) there shall be substituted the words "to the supply of gas (directly or indirectly) to a public gas transporter, gas supplier or gas shipper".").

Page 67, line 13, leave out ("25,000").

Page 67, line 14, leave out ("732,000").

The noble and learned Lord said: My Lords, in moving Amendment No. 143, I spoke also to Amendments Nos. 146 to 148. I beg to move.

On Question, amendments agreed to.

[Amendment No. 149 not moved.]

Lord Fraser of Carmyllie moved Amendments Nos. 150 and 151:

Page 68, line 1, leave out ("paragraph 1(1)") and insert ("sub-paragraph (1) of paragraph 1").

Page 68, line 8, at end insert— ("( ) After sub-paragraph (3) of that paragraph there shall be inserted the following sub-paragraphs— (4) If and to the extent that regulations made by the Secretary of State so provide, a public gas transporter shall pay, by way of compensation for any loss sustained by any person in consequence of the exercise of those powers, such sum as may be determined in accordance with the regulations. (5) Except with the consent of all public gas transporters, no regulations may be made under sub-paragraph (4) above which amend, or re-enact with modifications, regulations previously made under that sub-paragraph." ").

The noble and learned Lord said: My Lords, in moving Amendment No. 133, I wished to speak also to Amendments Nos. 150 and 151. I beg to move.

On Question, amendments agreed to.

Schedule 4 [Minor and consequential amendments]:

Lord Fraser of Carmyllie moved Amendment No. 152:

Page 70, line 40, at end insert—

("Statistics of Trade Act 1947 (c.39)

—(1) In relation to gas, subsection (5)(b) of section 9 of the Statistics of Trade Act 1947 (restriction on disclosure of information obtained under that Act) shall have effect as if the references to the total quantity or value of any articles produced, sold or delivered included a reference to each of the following, that is to say—

1. (a) the total quantity or value of gas which is supplied in Great Britain;
2. (b) the total quantity or value of gas which in Great Britain is supplied—
1. (i) for the same purposes, or for different purposes but in similar quantities;
2. (ii) to premises appearing to the Secretary of State to be of the same description; or
3. (iii) on terms appearing to the Secretary of State to be similar as respects continuity of supply;
3. (c) the total quantity of gas which in Great Britain is conveyed or shipped to premises for supply purposes, or is stored; and
4. (d) the total quantity of gas which in Great Britain is conveyed or shipped to or from, or is stored in, facilities or pipe-line systems appearing to the Secretary of State to be of the same description.

(2) If different areas of Great Britain are specified for any purposes of this paragraph by order made by the Secretary of State, this paragraph shall have effect for those purposes as if any reference to Great Britain included a reference to each of those areas.

(3) An order under this paragraph shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(4) In this paragraph—

• "convey" means convey through pipes;
• "for supply purposes", in relation to any conveyance or shipment of gas to any premises, means with a view to the gas being supplied to the premises, or being used in the premises by the holder of a licence under section 7A(2) of the 1986 Act;
• "gas" and "public gas transporter" have the same meanings as in Part I of the 1986 Act;
• "store" means store in, or in a facility which is connected (directly or indirectly) to, a pipe-line system operated by a public gas transporter;
806
• "supply", in relation to gas, means supply to premises to which the gas has been conveyed, other than supply (directly or indirectly) to a public gas transporter, gas supplier or gas shipper.

(5) For the purposes of this paragraph—

1. (a) gas is shipped if, in pursuance of arrangements made with a public gas transporter, it is introduced into, conveyed by means of or taken out of a pipe-line system operated by that transporter; and
2. (b) any reference to the shipment of gas to any premises, or to or from any facilities or pipe-line systems, shall be construed accordingly.").

On Question, amendment agreed to.

Lord Fraser of Carmyllie moved Amendment No. 153:

Page 76, line 5, leave out paragraph 20.

The noble and learned Lord said: My Lords, the amendment has been brought forward in response to points which were raised at earlier stages by the noble Lord, Lord Peston, and the noble Lord, Lord Ezra. As my noble friend Lord Ferrers made clear in response to that debate, the deregulation order-making power in the Deregulation and Contracting Out Act applies only to legislation passed up to and including the 1994 Session. That was because we recognised that Parliament could not know what future legislation might consist of and whether it would be appropriate to introduce an order-making power of that kind.

In view of the strong views expressed, we have considered again whether such a provision was really needed in the Bill. We have concluded that it is not. I beg to move.

Lord Peston

My Lords, I thank the Minister on behalf of all noble Lords who are interested in the matter. I believe that he is entirely right: the provision is not needed in this Bill, apart from any question of principle. I am most indebted to him for taking out the paragraph.

Lord Ezra

My Lords, perhaps I may reiterate what the noble Lord, Lord Peston, said. It was a provision that caused us acute concern. I am glad that the Government have come to the conclusion that it is not relevant. It seemed to us that it raised a serious matter almost of constitutional concern. Now that the paragraph has been removed, we are once again indebted to the Minister for his understanding of the position which we then expressed.

On Question, amendment agreed to.

Schedule 5 [Transitional provisions and savings]:

Lord Fraser of Carmyllie moved Amendments Nos. 154 to 178:

Page 76, line 26, leave out ("the persons so mentioned") and insert ("those persons").

Page 77, line 3, leave out ("as may be") and insert (", and only such provision, as the Secretary of State considers").

Page 78, line 2, after ("may") insert ("if he thinks fit").

Page 78, line 3, at end insert ("appropriate for the purpose of securing that the scheme makes such provision, and only such provision, as he considers").

Page 78, line 11, after ("provision") insert (", and only such provision,").

Page 79, line 30, leave out ("paragraph") and insert ("paragraphs 4(4)(b) and").

Page 80, line 8, after ("be") insert ("issued as fully paid and").

Page 80, line 9, leave out ("of their nominal value in cash") and insert ("in cash of their nominal value and, if the scheme so provides, such premium as may be so specified or determined").

Page 80, line 10, at end insert—

("Statutory accounts

—(1) This paragraph has effect for the purposes of any statutory accounts of the transferee, that is to say, any accounts prepared by the transferee for the purpose of any provision of the Companies Act 1985 (including group accounts).

(2) Subject to sub-paragraph (3) below, the value or amount to be assigned to any asset or liability which is vested in the transferee by virtue of paragraph 6 above shall be—

1. (a) the value or amount (if any) assigned to the asset or liability for the purposes of the corresponding statement of accounts prepared by the public gas supplier in respect of the last complete accounting year of the supplier to end before the appointed day; or
2. (b) if the asset or liability is part only of an asset or liability to which a value or amount is so assigned, so much of that value or amount as may be determined by or under the scheme under paragraph 2 above; or
3. (c) if no value or amount is given by paragraph (a) or (b) above or the value or amount so given is inappropriate in all the circumstances of the case, such value or amount as may be determined, on the basis of the supplier's accounting records, by or under that scheme.

(3) The amount to be included in respect of any item shall be determined as if so much of anything done by the public gas supplier (whether by way of acquiring, revaluing or disposing of any asset or incurring, revaluing or discharging any liability, or by carrying any amount to any provision or reserve, or otherwise) as may be determined by or under the scheme under paragraph 2 above had been done by the transferee.

(4) Without prejudice to the generality of the preceding provisions of this paragraph, the amount to be included from time to time in any reserves of the transferee as representing the transferee's accumulated realised profits shall be determined as if such proportion of any profits realised and retained by the public gas supplier as is determined by or under the scheme under paragraph 2 above had been realised and retained by the transferee.

(5) In this paragraph, in relation to the public gas supplier—

• "accounting records" means accounting records kept by the supplier in pursuance of section 221 of the Companies Act 1985;
• "complete accounting year" means a financial year of the supplier determined in accordance with section 223 of that Act.").

Page 82, line 4, after ("Director") insert ("(in such terms as may be specified by the applicant for the purposes of this sub-paragraph)").

Page 82, line 9, leave out ("the persons so mentioned") and insert ("those persons").

Page 83, line 5, leave out ("sub-paragraph (4)") and insert ("sub-paragraphs (3A) and (4)").

Page 83, line 10, at end insert— ("(3A) Sub-paragraph (3) above shall not apply in relation to a licence treated as granted under section 7A(1) of the 1986 Act which authorises only the supply to premises of gas which has been conveyed to the premises otherwise than by a public gas transporter.").

Page 83, line 11, leave out ("so granted") and insert ("granted under section 7A(1) or (2) of the 1986 Act").

Page 83, line 12, leave out ("the 1986") and insert ("that").

Page 83, line 18, after ("revocation") insert ("or suspension").

Page 83, line 45, at beginning insert ("(1) Subject to sub-paragraph (2) below,").

Page 83, line 48, after ("such") insert ("one").

Page 84, line 3, at end insert— ("(2) lf, in the case of any such authorisation as is mentioned in sub-paragraph (1) above, the Secretary of State is satisfied that exemption from such one or more of paragraphs (a), (b) and (c) of section 5(1) of the 1986 Act as may be requisite to meet the particular circumstances of the case will be granted under section 6A of that Act as from the appointed day, he may by order direct that that sub-paragraph shall not apply in relation to the authorisation. (3) An order under this paragraph shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.").

Page 85, line 14, leave out ("This paragraph") and insert ("Sub-paragraph (1A) below applies where—

1. (a) a public gas supplier has been required under subsection (1) (duty to supply certain premises) of section 10 of the 1986 Act to give a supply of gas to any premises; and
2. (b) the required supply is not given before the appointed day.

(IA) The requirement shall have effect on and after the appointed day as if it were—

1. (a) a request made to the supplier's supply successor for a supply of gas; and
2. (b) if the premises are not connected to a relevant main, a requirement made of the supplier's transport successor under subsection (2)(a) of section 10 requiring him to connect the premises to such a main and supply and lay any pipe that may be necessary for that purpose.

(1B) Sub-paragraph (2) below").

Page 85, line 16, leave out ("section 10 of the 1986 Act (connection charges)") and insert ("subsection (4) (connection charges) of section 10").

Page 85, line 18, leave out ("paragraph") and insert ("sub-paragraph").

Page 85, line 31, at end insert— ("( ) In this Part of this Schedule "supply successor", in relation to a public gas supplier, means the person who becomes a gas supplier by virtue of a scheme made by or in relation to that public gas supplier under Part I of this Schedule.").

Page 85, leave out lines 40 to 43.

Page 88, line 6, at end insert—

("Street works notices

27A. Any notice—

1. (a) which has been given by a public gas supplier in England and Wales under section 54, 55 or 57 of the New Roads and Street Works Act 1991, or in Scotland under section 113, 114 or 116 of that Act; and
2. (b) which is in force immediately before the appointed day, shall have effect on and after that day as if it had been given by the public gas supplier's transport successor.").

The noble and learned Lord said: My Lords, I am advised that, unless there is objection, I may move the remaining amendments. There is no objection to that; I therefore do so. I beg to move Amendments Nos. 154 to 178.

On Question, amendments agreed to.

Lord Fraser of Carmyllie moved Amendments Nos. 179:

Page 88, line 6, at end insert—

("Restrictive trade practices

27B.—(1) In relation to any supply of gas before the appointed day, the reference in subsection (2) of section 62 of the 1986 Act (exclusion of agreements from Restrictive Trade Practices Act 1976) to a supply of gas otherwise than under a licence granted under section 7A(1) of the 1986 Act shall have effect—

1. (a) in the case of a supply before 23rd August 1986, as a reference to a supply of gas otherwise than in performance of any duty imposed by the Gas Act 1972; and
2. (b) in the case of a supply on or after that date, as a reference to a supply of gas otherwise than under an authorisation granted under section 7 of the 1986 Act.

(2) In relation to any introduction or taking out of gas, or any use of a system or facility, before the appointed day, subsection (2A) of section 62 of the 1986 Act shall have effect as if—

1. (a) the reference to a public gas transporter were a reference to a public gas supplier; and
2. (b) the reference to gas shippers were a reference to any persons.").

The noble and learned Lord said: My Lords, I shall now move the other amendments to which I have spoken. I beg to move Amendment No. 179.

On Question, amendment agreed to.

Schedule 6 [Repeals]:

Lord Fraser of Carmyllie moved Amendments Nos. 180 to 182:

Page 89, line 37, leave out from ("48(1),") to ("of') in line 41 and insert ("definitions of "regulations" and").

Page 89, line 42, column 3, at end insert— ("Section 62(7).").

Page 90, line 11, column 3, leave out ("and 6") and insert (", 6 and 9(3)")

On Question, amendments agreed to.