Lords Sitting of 17 January 1996

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Southwark.
The Earl of Oxford and Asquith The Earl of Oxford and Asquith—Took the Oath.

Accountants and Assets Offshore
Lord Haskel Lord Haskel asked Her Majesty's Government:
Whether they will continue to deal with those accountancy firms whose partners are moving their assets offshore.
The Minister of State, Department of Social Security (Lord Mack ay of Ardbrecknish): My Lords, Her Majesty's Government will consider whether to continue to deal with an accountancy firm which moves its assets offshore if and when the partners decide to embark on such a course of action and make detailed proposals available for consideration.
Lord Haskel: My Lords, as the Government must be one of the largest clients of those firms, have the firms consulted the Government so that we can be assured that in the event of rightful claims the taxpayers' compensation will be met?
Lord Mackay of Ardbrecknish: My Lords, as I indicated in my original reply, those firms have not consulted the Government. However, if they were to make that move, and we were then to consider employing one of those firms, we should look carefully at the terms of registration in Jersey.
It has to be said that media reports suggest that Jersey is to introduce a limited liability partnership law which, subject to parliamentary and UK Privy Council approval, would come into effect by the end of 1996. United Kingdom audit firms could then register as limited liability partnerships in Jersey. However, we ought to wait to see the print on anything that occurs before we come to a judgment.
Lord Bruce of Donington: My Lords, in declaring a possible personal interest as a practising chartered accountant, perhaps I may ask the noble Lord whether his replies are in any way conditioned by the fact that the Government may be seeking advice on where to put their funds in the light of the forthcoming defeat at the general election?
Lord Mackay of Ardbrecknish: My Lords, the latter part of the noble Lord's question represents an amazing amount of conjecture coming, as it does, from such a serious person as an accountant. However, I was relieved that he was not telling me that he was intending to remove himself to Jersey because that would deprive me of many interesting jousts at this Dispatch Box.
Viscount St. Davids: My Lords, will my noble friend please explain this? As the Government do considerable business with companies that have limited liability, why should they have any problem doing business with firms that have unlimited liability but whose assets are beyond the reach of recompense for UK taxpayers?
Lord Mackay of Ardbrecknish: My Lords, if in the future any of the companies decides to register in Jersey, we would have to examine the terms on which the registration was made. There are other options for the companies: they could establish limited companies rather than partnerships to perform the audits. The Companies Act 1989 permits limited companies to undertake audits of other limited companies. Indeed, one accountancy firm has already taken advantage of that provision. However, reaction to that course of action from other accountancy firms appears to be mixed.
Lord Monkswell: My Lords, the Minister mentioned that legal changes in Jersey were subject to Privy Council approval. Can he advise the House whether such Privy Council approval is automatic and also whether there would be an opportunity for this House and the other place to debate such matters before they are approved by the Privy Council?
Lord Mackay of Ardbrecknish: My Lords, not being a member of Her Majesty's Privy Council, I am in some difficulty in answering the noble Lord's question. If he will forgive me, I shall have to write to him.
Lord Eatwell: My Lords, will the Government agree that the privilege of operating an accountancy business within the United Kingdom carries with it the responsibility of providing appropriate compensation in the case of unsatisfactory service?
Lord Mackay of Ardbrecknish: My Lords, I believe that the existence of the possibility of a firm being sued by its client is a factor that we ought to retain. It concentrates the firm's mind on ensuring that it gets the job right and that it is well done. If and when we come to examine possible changes, we will have to take into account the general good; not just the position of accountancy firms but also that of any other firm involved on the other side of the fence—that is the client.
Lord Boyd-Carpenter: My Lords, my noble friend did not answer the question as to whether the issue would be debatable. Surely any such issue must be debatable, if this House wishes to debate it.
Lord Mackay of Ardbrecknish: My Lords, my noble friend is quite right. However, I was asked a specific question about the Privy Council and this House debating proposals to change the law in Jersey. As I said to the noble Lord, Lord Monkswell, I am afraid that I shall have to take advice on that.

International Health Service
2.44 p.m.
Lord Molloy Lord Molloy asked Her Majesty's Government:
Whether they would support the creation of an international health service.
The Parliamentary Under-Secretary of State, Department of Health (Baroness Cumberlege): My Lords, although we co-operate through international organisations such as the World Health Organisation, and more informally through professional and other networks, we do not believe it realistic to set up an international health service with every country operating an identical system.
Lord Molloy: My Lords, I thank the Minister for that reply. However, the object of my Question was to ensure that despite the terrible diseases spreading in many parts of the world, the British people should not be called upon to make any unjust contribution. We are willing to help and to do our best, but we must not be put upon. There must be a fair contribution from all the nations that can afford it. Will the Minister agree that it is vital for the interests of the health organisation that the generosity of the British people should not be exploited?
Baroness Cumberlege: My Lords, I am grateful to the noble Lord for explaining the purpose behind his Question. Worldwide, we all have a responsibility to ensure that infectious diseases are contained within the countries affected, but we do not believe it appropriate that we should become involved in other countries' health systems.
Lord Winston: My Lords, is the Minister aware that in West London at present there are many patients on waiting lists who cannot get into hospital? Expensive operating theatres are lying idle. Does she agree that it might be more important to concentrate on a national health service rather than an international one?
Baroness Cumberlege: My Lords, I believe that we have a remarkable National Health Service; it is a near miracle. It is interesting, when one examines waiting lists, that we have seen tremendous progress in the past two or three years through health reforms. In March 1990, over 200,000 people were waiting over one year for treatment and today it is 28,000.
The Countess of Mar: My Lords, does not the British National Health Service have an international dimension in that it provides training for overseas doctors? They go back to their own countries with our expertise. Many patients come from overseas to benefit from the provisions not of the National Health Service but of private medical treatment which they have often heard of through the National Health Service.
Baroness Cumberlege: Yes, my Lords, the noble Countess is right. The training of doctors in this country is recognised as being among the best in the world. When one travels abroad it is encouraging to see many
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of the students now taking on positions of clinical responsibility and leading medical practice in their own countries.
Lord Bruce of Donington: My Lords, will the Minister confirm that the reciprocal arrangements which were concluded by the Council of Europe regarding the interchange of facilities between the European countries affected are still fully in force? Will she ensure that people here are aware of the reciprocal arrangements whereby participants in the National Health Service here are entitled to equivalent treatment in other countries with whom arrangements have been negotiated through the aegis of the Council of Europe?
Baroness Cumberlege: Yes, my Lords.
Lord Skelmersdale: My Lords, will the Minister advise the noble Lord, Lord Bruce, that when he next goes to Europe he should take with him Form E.111? It gives him the right to treatment in any European Union country.
Baroness Cumberlege: My Lords, far be it from me to give the noble Lord, Lord Bruce, any advice.

Unemployment
2.48 p.m.
Lord Dormand of Easington Lord Dormand of Easington asked Her Majesty's Government:
When they expect unemployment to fall to 1 million people.
The Minister of State, Department for Education and Employment (Lord Henley): My Lords, the Government do not make forecasts of unemployment. Falling unemployment depends on sustainable economic growth. The prospects for that are better than they have been for many years.
Lord Dormand of Easington: My Lords, to clarify the situation, is the Minister aware that we on these Benches welcome every reduction in unemployment? However, we do not welcome the continuing complacency which the Government show on a matter which devastates so many lives. Should we not compare the present total of 2.3 million unemployed with the 1.3 million unemployed when the Government came to power? Will the Minister confirm two important statistics; first, that the average monthly fall in unemployment over the past six months is 15,000–0.5 per cent.—which is hardly an impressive figure, and, secondly, that there are almost four times as many unemployed as there are vacancies?
Lord Henley: My Lords, I am glad that the noble Lord welcomes the 28th successive fall in the unemployment statistics. I rather resent the fact that we are accused of complacency when the noble Lord himself, who claims that he welcomes the figure, stopped tabling his regular questions on the unemployment figures just at the moment when they

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started to fall some 28 months ago. They have been falling steadily since then. I also reject and regret the accusations of complacency from a party opposite which does its damnedest, by advocating that we sign up to the social chapter and bring in the minimum wage, to put up unemployment.
Lord Clark of Kempston: My Lords, will my noble friend agree that it is illogical for noble Lords in the Labour Party to criticise the fall in unemployment that has now been going on for nearly two years under the economic programme of this Government? Will he also agree that, again, it is illogical for criticism to be levelled at this Government when the avowed policy of the Labour Party is not only to introduce a minimum wage, which would increase unemployment, but also to sign up to the social chapter, which would be disastrous for the economy?
Lord Henley: My Lords, my noble friend is absolutely right. As I made clear in my previous answer, unemployment has now been falling for 28 months consecutively. It is now well below the level in all the major countries in Europe. Further, the percentage of long-term unemployed has been falling and is now lower than the European average. Our rate of youth unemployment is lower than the average in Europe. I could continue.
Lord Dean of Beswick: My Lords, the Minister has said that it is the Government's responsibility to create the right economic climate as regards employment. Is he aware that under the premiership of the noble Baroness, Lady Thatcher, unemployment in this country rose to an all-time high? Am I to take it that the Government have now officially dished her policies?
Lord Henley: My Lords, unemployment did rise to an all-time high. It came down quite dramatically in the early 1980s. It then went up again, but did not reach the same peak. That was the first time in any cycle that it peaked at a lower level than the previous peak. We are now seeing a very welcome change in the circumstances. The economic policies that the Government have been pursuing are very much responsible for that decline. As I said to the noble Lord's noble friend, those policies have now given us 28 consecutive months of falling unemployment.
Lord Hailsham of Saint Marylebone: My Lords, will my noble friend confirm what I understood him to say in his main Answer; namely, that the level of unemployment depends on sustainable economic growth or otherwise? Does he therefore agree that it is wholly out of place to turn the issue into a party political controversy?
Lord Henley: My Lords, I am not the one who wants to create party political controversy. I do want to make clear that Her Majesty's Government are committed, as my noble and learned friend said, to sustainable economic growth. It is sustainable economic growth that will create the jobs. Also, I can assure noble Lords opposite that Britain now has the second highest
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employment rate of any European country as well as a falling unemployment rate. We will continue to pursue the policies that produce those figures.
Lord Callaghan of Cardiff: My Lords, in order to pursue the non-party approach of the noble Lord opposite, may I ask whether the Government still adhere to the "one nation" policy of the coalition government during the war when they set out as an objective a rate of unemployment of 3 per cent?
Lord Henley: My Lords, we have no specific rate of unemployment that we seek. We want to see unemployment as low as possible. That will be achieved, as the noble Lord well knows, by pursuing appropriate and right economic policies.
Lord Alport: My Lords, does my noble friend have any statistics in regard to unemployment among the managerial and executive class?
Lord Henley: My Lords, I cannot at this Dispatch Box give a breakdown of the figures for which my noble friend asks. I can certainly give him a great many statistics on levels of unemployment and employment in this country. I was trying to assure the House that the figures are not nearly as bad as the party opposite seem to imply. In fact, they are far better than those of most of our colleagues in the European Community.
Baroness Dean of Thornton-le-Fylde: My Lords, unemployment is a tragedy for anyone. I should like to direct one particular question to the Minister about the figures. Does he agree that the rate of unemployment among black workers in some areas of this country is double that of white workers and that the gap is larger today than it was a decade ago? Does the Minister accept that ethnic minority workers in Britain are more likely to be among the long-term unemployed than are their white citizen counterparts? Does the Minister further accept that this does nothing for social cohesion? It is not one nation politics and whatever measures the Government have taken are clearly failing.
Lord Henley: My Lords, the noble Baroness is right to draw attention to variations in levels of unemployment in different groups and in different areas. I cannot confirm or deny the figures that she quotes about different rates of unemployment among certain ethnic minorities. I can tell her that within the regional variations in this country, the gap between the best and the worst region is now only 7.2 per cent. That compares very well indeed with the percentages of our European colleagues. In Italy, for example, the gap between the best region and the worst is something of the order of 17 per cent. Even in Germany, there is a gap of some 14 per cent. The more we can narrow the gap the more we can look to the social cohesion that the noble Baroness seeks.
Baroness Nicol: My Lords, is it not the case that the falling figure to which the Minister attaches great importance, as do we all, does not include people actively seeking work who are not entitled to claim benefit? I could he wrong. Will the Minister confirm

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that that is the position? How can the Government properly judge the economic health of society if they do not know that particular figure?
Lord Henley: My Lords, as the noble Baroness will know, we have two measures for counting unemployment. The first is the count itself, which appears once a month. It is an accurate count of exactly what it claims to measure; namely, those out of work and in receipt of benefit. There is also the Labour Force Survey, a survey of a certain number of people which takes place once every three months and provides a figure that is broadly the same. Both figures show a very consistent decline in unemployment, a decline which, as I made clear, has now continued for some 28 months consecutively.
Lord Ewing of Kirkford: My Lords, the Minister's figures are incomplete. He did not mention the third survey from the Central Statistical Office of the Workforce in Employment. What does the Minister have to say in regard to the discrepancy between the figures produced by the Labour Force Survey and the Workforce in Employment survey? To be fair to the Minister, the Labour Force Survey shows that there are more people in employment, but the Workforce in Employment survey shows fewer people in employment. Indeed, the Minister's department has now set up an inquiry to see how the discrepancy arose.
Lord Henley: My Lords, I think the noble Lord will find that all the surveys show very broadly the same trends. Obviously, from one month to another figures may diverge to some extent. I recommend that the noble Lord examines the figures in the long term; he will then notice exactly the same trends applying to both surveys.
Lord Dormand of Easington: My Lords, is it not significant that the Minister does not deal with the main point that I raised? I repeat that we welcome the fall that has been going on for some time now. But the level is going down very slowly indeed. That is why I used the figure of 1 million in my Question. It will be many, many years—if ever—before the figure falls to 1 million, which after all is pretty high. Will the Minister deal specifically with the two questions that I asked?
Lord Henley: My Lords, in the noble Lord's first supplementary, he posed quite a large number of questions. In line with the guidance in the Companion to the Standing Orders, I believe I answered the noble Lord's first two points. I am so advised. I can confirm that unemployment is coming down by some 10,000 to 15,000 a month. That is a good, steady figure. If we could see an employment figure that was higher, that would be wonderful. But we are not going to try to create a figure by artificial means. We will continue to pursue the policy of creating jobs by means of pursuing appropriate economic policies.
Baroness Seear: My Lords, will the noble Lord agree that the level of unemployment among the unskilled, which is where unemployment primarily exists, is due
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to the failure not only of this Government but also of previous governments of another complexion to provide adequate training?
Lord Henley: My Lords, we do provide adequate training. The Employment Service provides something of the order of 1½ million opportunities of one sort or another and will be doing so in the coming year. Obviously, the noble Baroness is right to draw attention to the need for training. The more qualifications and the more training any individual can take up, the greater are his or her chances of finding a job.

Television Licence Evasion: Penalties
3 p.m.
The Viscount of Falkland The Viscount of Falkland asked Her Majesty's Government:
How many people are presently serving terms of imprisonment for failure to pay fines imposed for not having a current television licence.
The Parliamentary Under-Secretary of State, Department of National Heritage (Lord Inglewood): My Lords, on 30th November 1995, the most recent date for which figures are available, there were 16 people in England and Wales serving terms of imprisonment for non-payment of fines imposed for television licence evasion.
The Viscount of Falkland: My Lords, I thank the Minister for that reply. However, does he not agree that any reasonable person may take the view that to send someone to prison for non-payment of a fine resulting from the failure to pay a current television licence fee is a harsh penalty? Is not there another way of dealing with such offenders? Surely it is not beyond the means of man's technical ingenuity these days to find another way to deal with such cases; perhaps depriving viewers of their sets rather than sending them to prison.
Lord Inglewood: My Lords, I should emphasise that imprisonment for non-payment of a fine imposed for the non-payment of a television licence fee is very much a last resort. It takes place only after wilful refusal or culpable neglect on the part of the person concerned. The inability to disconnect television sets plays a large part in the thinking behind this matter. Were technology to be introduced to enable disconnection, that would be a major factor in our thinking. The Broadcasting Bill considers the advent of digital television and that technology may have a bearing on the point.
Lord Allen of Abbeydale: My Lords, how many of the 16 are women? And are figures available for Scotland?
Lord Inglewood: My Lords, I do not have the figures as at 30th November. However, in 1994 a total of 730 people were imprisoned under this heading, of whom 487 were male and 243 female. Figures are available for Scotland, but I am afraid I do not have them at the moment.
Lord Hylton: My Lords, is it not the case that there are other and larger classes of non-payers finding

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themselves in prison? For example, there are non-payers of poll tax, council tax and ordinary fines in prison. What steps are the Government taking to ensure the maximum possible use of non-custodial sentences for such offenders?
Lord Inglewood: My Lords, the noble Lord's question goes beyond that on the Order Paper. However, as a matter of policy prison is a last resort.
Lord Geddes: My Lords, I acknowledge that this is not an entirely original question, but can my noble friend give thought again to the sellers of television sets being obliged to sell licences with those television sets, thereby greatly reducing the number of people failing to pay licence fees?
Lord Inglewood: My Lords, that matter bears consideration. But if, for example, a television set has a life of 20 years and if, as is the case for next year, the cost of a colour TV licence is £89.50, it follows that the price of a television set, in order to recover a licence fee in respect of its economic life, would be hugely prohibitive.
Lord McIntosh of Haringey: My Lords, is not there another reason why the question of the Minister's noble friend is irrelevant? I refer to the fact that most people who buy television sets already own one and already possess a licence which is transferable. More seriously, the Minister gave an Answer in respect of England and Wales. Is it the case, as I believe it is, that in Scotland there are no cases of imprisonment for non-payment of fines of this kind? Though the Minister's answers have been extremely reassuring, would it not be desirable to follow the Scottish practice?
Lord Inglewood: My Lords, I understand that the procedures in this regard are different in Scotland and that distress is levied in a manner which is different from England and Wales. That is a step which automatically precedes the possibility of imprisonment. It follows therefore that more distress orders—or their Scottish equivalent—are served in Scotland, which can in turn have extremely serious consequences, particularly for those living with the person whose goods may be distrained and who may be dependent on the goods for their ordinary day-to-day lives. I understand that after that people may be imprisoned for non-payment, and it does happen.
Lady Saltoun of Abernethy: My Lords, surely if one has a licence, one can be obliged to take it along when purchasing a new set. If one does not have a licence, then one may be compelled to buy one when purchasing the television set.
Lord Inglewood: My Lords, under the current arrangements the person from whom one buys a new set is different from the person from whom one acquires the licence. In any event, it would have ramifications for the second-hand market.

Business
Lord Strathclyde: My Lords, with leave I should like to say a word about today's debates standing in the names of the noble Lords, Lord Morris of Castle Morris and Lord Carter. Other than the movers, the Front Bench spokesmen and the Ministers replying, other speakers will be limited to eight minutes in the case of the first debate and seven minutes in the case of the second. I should remind your Lordships that if any noble Lord were to speak at greater length, he would be doing so at the expense of subsequent speakers in the debate. I also remind your Lordships that when the digital clock shows seven minutes, the full seven minutes have elapsed and the speaker is already trespassing on the time of others.

Education
3.6 p.m.
Lord Morris of Castle Morris Lord Morris of Castle Morris rose to call attention to the need of children aged three to 19 years for high quality education, with especial reference to the responsibilities of local authorities in their areas; and to move for Papers.
The noble Lord said: My Lords, as your Lordships will recall most readily, the patron saint of teachers is St. Jean-Baptiste de la Salle, who insisted that all teaching should be received by pupils sitting perfectly still and in complete silence—small chance of that in today's schools or, come to that, in your Lordships' House this afternoon!
In introducing today's debate I shall not comment on the Government's proposed legislation because that would constitute an unwarrantable intrusion into private grief. I shall say nothing about student loans and their postponement due to the sad reluctance of banks and building societies to join in the game, hardly a word shall escape my lips about nursery vouchers, which only four authorities could be cajoled even to pilot; and I shall be silent about fast-tracks to GMS for church schools, which the Government unfortunately forgot to ask the Bishops about. It could have happened to anyone. Let us look, rather, at the roots of the matter; at the quality of the education that the Government permit our young people to enjoy.
It is a truth universally acknowledged that young persons between the ages of three and 19 must be in need of a high quality education. That is because, first, future citizens must be enabled to live fulfilling lives; and, secondly, because the nation needs a skilled, highly trained workforce with which to compete in the world economy of the 21st century.
It is equally true that they are not getting high quality education. At last week's North of England education conference, Mr. Geoffrey Holland, formerly the Permanent Secretary at the DFE, reported that the World Economic Forum rated the UK 24th in the world in terms of workforce skills, down from 21st place a year earlier. The forum described the UK as having an "inadequate educational system" and ranked it 35th in

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the world, despite it being at the mid-table point in terms of funding and class size in schools. So much for training our skilled workforce.
Then the day before yesterday the Government's chief curriculum adviser, Dr. Nick Tate, in an amazing speech, told us that many teenagers now leave school believing that morality is just a matter of "what is right for me". He told teachers that they must find practical ways of teaching morality, spirituality and universal human values. We know that schools are legally required to provide religious education for all pupils up to the age of 16. But school inspections found that one-third of schools failed to devote the minimum 5 per cent. of their lesson time to the subject. The best that the Government can offer is two new GCSE mini-courses from next September. I suspect that the mini-course will cover about as much as the mini-skirt, and be very much less attractive. So much for the fulfilled lives of our future citizens.
The Government, of course, will blame everyone but themselves for that dismal lack of quality. They blame the parents. They blame the Churches. They blame the trendy left-wing teachers and their Marxist masters in the training colleges. That cock will not fight. This Government have been in power for nearly 17 years, with majorities which enabled them to do anything they liked. No, the buck stops on the desk of the right honourable Mr. John Major and nowhere else.
Above all, the Government cannot pin blame on the local authorities this time. Things have changed in half a century since the Education Act 1944, but the LEAs have stood the test of time remarkably well. Gone are the days when all the detailed decisions about premises and purchases had to be taken in county or town halls. So let us hear no nonsense today suggesting that local government wishes to re-acquire "control" over schools. LEAs support schools and provide those general educational services which have to be organised on a wider basis, as, for example, provision for special educational needs. The LEA is essentially now a guardian and raiser of standards rather than a chain of command.
The LEAs now provide rapid response and organisational support when disaster unpredictably befalls any particular school. One thinks of the Lyme Bay canoeing tragedy, when it was reported that the Devon school concerned asked publicly where it would have been without the immediate aid of Devon County Council's Education Committee and its officers; and the recent tragic death of the London headteacher Mr. Philip Lawrence, when it was the LEA which provided immediate counselling and immediate help in dealing with the media. There are thousands of lesser examples every year.
Local education authorities also provide essential professional support for schools. The development of a national curriculum now commands general support, but its perpetual rejigging and its sempiternal bureaucracy does not. The years of bitter and wasteful wrangling with the teachers over its implementation were sorted out not by the Government but by the advisers and
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inspectors at LEA level; and what a nonsense it is to dismantle that professional LEA infrastructure and separate the functions of inspection and advice.
Among others, Sir Roy Harding, vice-chairman of the Royal Society Education Committee, voiced his concern recently about the decline in specialist support. Between 1992–93 and 1994–95, LEA advisory and inspector posts fell by about one quarter. Over the same period, advisory teacher posts fell by about one third. Approximately half the LEAs in his survey had fewer than 17 advisers or inspectors, the number which the Audit Commission considered an appropriate minimum in 1989. The decline in advisory teachers was across all subject areas, with the main national curriculum subjects mostly in the range of a 35 per cent. to 40 per cent. drop. Further reductions in specialist support are anticipated.
No LEA willingly makes those cuts; they are forced by underfunding. If LEAs cannot provide that support, who can do so? If no one can, is it not inevitable that the quality of education must be lowered?
Budget pressures also account for similar reductions in other front-line staff, such as education welfare officers, who are responsible for dealing with truancy problems—and truants in all our schools are arrogantly aware that they can seldom be brought to book: they can walk in in the morning, sign in, walk out and not appear again; or educational psychologists, who are not headshrinkers but experts in dealing with those disruptive pupils, who, as we well know, can wreck any school, however good, and who deal also with children with special educational needs. This afternoon, your Lordships will hear a great deal more about special educational needs, not least from my noble friend Lord Haskel. Those services cannot possibly be provided at school level. They demand the existence of an LEA acting in the general interest of the schools and children of its area.
When we turn to the problems of children with special educational needs, we see the Government's casuistry at its most blatant. It is now LEAs which must identify children with problems, assess their needs and, in severe cases—there are many of them—issue a statement of special educational requirements. How splendid! But as soon as a statement is issued, the LEA becomes legally liable for the cost of its recommendations. The new tribunal system looks likely to generate more expensive outcomes than hitherto and thousands of teachers report that their LEAs are desperately reluctant to "statement" a child, even when the need to do so is glaringly obvious, because they know that they cannot afford the expenditure that it will involve.
Yet perhaps the most telling example of the disdain of this Government for the vital work of LEAs is in the matter of school admissions. LEAs are the admission authorities for maintained and controlled schools. That is a sensitive and complex requirement. However, the Government's ewe lambs, the grant-maintained schools, are their own admission authorities, and so they can admit pupils of their choice. Since the 8th January they may even increase the proportion of pupils admitted by reference to

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general ability from 10 per cent. to 15 per cent., and interview parents to help them make their choice. Is it any wonder that LEAs feel themselves threatened, harassed, undervalued and arrogantly ignored by this Government?
Apart from fulfilling their statutory requirements to the highest standards, the LEAs have shown themselves vigorously active and inventive over and above their legal duties. Perhaps I may give, briefly, two examples.
First, in Leeds they have developed a "Family of Schools" initiative, to attract additional finance into primary and secondary schools, to improve the co-ordination and effectiveness of council services, and to enhance the learning opportunities for children and young people within the FE community services—all that and much more. There is already evidence of considerable success, especially in generating a new and powerful community feeling in that part of Leeds. The Leeds initiative could be paralleled in dozens of other local authorities. It is evidence of the vital work being done by co-operation—not competition—at the local community level, organised by democratically elected authorities responsible to the communities which voted them into power.
Secondly, the work of the National Music Council of Great Britain and Northern Ireland in its local education authority music awards scheme reveals the astonishing depth and range of LEA provision for music in and beyond their schools. Croydon Music Teaching Agency has established a most exciting involvement with the London Mozart Players—I wish that I could do so; Cornwall, through Performing Arts Cornwall, has secured a three-year contract with substantial sponsorship from Classic FM to be a training centre for curriculum and instrumental music in the West Country. Shropshire developed INSET courses comparing Elgar with L.S. Lowry, Hockriey with the Beatles and Turner with Beethoven. The list is endless. Every initiative is local. Nothing like it could have emanated from Whitehall. It is a triumph for the LEAs.
Yet instead of recognising all that and encouraging it with the allocation of appropriate resources, the Government have ignored or disparaged the LEAs, and concentrated all their attention on forcing grant-maintained status on people who do not want it and waving those silly little vouchers for nursery education to tempt gullible or greedy parents.
The two central problems which the Government must tackle are underfunding and undermining. In 1995–96 local authorities are already budgeting to spend £18,076 million on the education service. In 1996–97 the Government think that this should be £17,962 million—the gross total standard spending for education. That is a reduction of £114 million.
Add to this the underfunding on school buildings and it is clear that the Government are not investing in the education of young people sufficiently to make the improvements we all want.
Far more damaging in the long run is the relentless undermining of LEAs by the Government. The responsibility of LEAs for higher and further education has been removed in the past seven years. So, partly,
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has the careers service and the school inspection service. LEAs have shown their flexibility by managing these changes, but perhaps what has been most damaging has been the constant undermining of LEAs by government Ministers and paid government officials.
I give one example. Her Majesty's Chief Inspector of Schools wrote a booklet published by a Right-wing think tank just before Christmas entitled A Question of Standards: Finding the Balance. He used the opportunity to undermine LEAs by questioning the continuing LEA role in providing professional support for schools. One would have hoped that he, above all, would have been supportive of the LEA role. But no.
Local education authorities are doing an excellent job, and contributing powerfully to the quality of education. I hope the Minister, when he replies, will not say, "We value the LEA contribution very highly. We can't see why they are worried". He may think that; he may believe that. The point is, they don't.
If tomorrow he and all his officials can go out to mend fences with the LEAs, fund them more effectively and stop publicly demeaning them and sneering at them, we shall not have wasted our time today. I beg to move for Papers.
3.21 p.m.
Baroness Young: My Lords, I thank the noble Lord, Lord Morris of Castle Morris, for introducing the debate and I should very much like to give a word of welcome to the two maiden speakers, the noble Lord, Lord Wallace of Saltaire, and the noble Baroness, Lady Hayman. We shall much look forward to hearing what they have to say.
All of us taking part in the debate will be in agreement about the importance of education for all those aged three to 19—those are the terms of the debate—and, indeed, beyond, although I think that that is not within the terms of the debate. The noble Lord, Lord Morris, was right to call attention to the need for high quality education. We all agree with him on that. It was also very brave of him from the Labour Benches to put his head over the parapet and offer observations on any subject at all. We are so used to the Labour Benches being completely silent now that they obviously have a three-line Whip of silence on every subject. So perhaps we may turn to the question before us this afternoon.
Lord Graham of Edmonton: The noble Baroness can do better than that.
Baroness Young: My Lords, I can do much better than that if I am given the opportunity. Noble Lords opposite should fasten their seat belts.
Since 1979 we have had a series of major educational reforms—and very remarkable reforms—which have been intended to raise standards in education. Perhaps I may say to the party opposite that every single one of those reforms was fought line by line by it in order to prevent them taking place. We have had the national curriculum, with core subjects of English, maths and science now obligatory for all children aged between

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five and 16. There is much greater emphasis on the three Rs in primary schools. We have regular testing and assessment.
I well recall the debates on the establishment of Ofsted. I was sorry to hear the noble Lord, Lord Morris, criticising Chris Woodhead over what he had said. Every school is now inspected every four years. The Ofsted reports not only have pointed up success but have identified failure, which is what one needs to do if one is to raise standards. The last report showed that 30 per cent. of lessons were deemed to he unsatisfactory. No one can be pleased with that, but at least we have identified the problem that needs to be put right.
Parents have been given a much greater say in the choice of their child's school. Nine out of 10 of them now get their first choice of school. There are elected parent governors and there is open enrolment. Bringing parents into the education service is one of the most important aspects of our reforms. I hope very much that my noble friend the Minister will say something about the very interesting development of compact schemes, whereby children at school and their parents make a commitment and if they succeed in keeping it the children get the offer of a job at the end. I have been involved with one such scheme. This is a particularly interesting development, especially for the average and less than average child.
Our reforms have helped popular schools to expand. If one wants to raise educational standards one needs to identify the schools which set those standards and then encourage others to come up to them. We have introduced grant maintained schools, which are immensely successful and, as we all know very well, very popular with those who choose to send their children to them. They are frequently pace setters.
All these policies have been opposed by the Labour Party. Yet all these policies are gradually having the effect of levering up educational standards. It is most encouraging of all that in the past five years the number of 16 year-olds staying on in education has increased from 48 per cent. to 71 per cent. We must all welcome that very much indeed.
I agree that more needs to be done. One never raises standards anywhere unless one is constantly on the watch for improvement. Nowhere is that more true than in the education service, as anyone knows who has had any involvement with teaching. I welcome the fact that more educational reforms are to come. I do not write off the nursery voucher scheme. How many times in your Lordships' House have I heard the demand for more nursery education? Now we are going to get it with the voucher scheme. It will give an opportunity to parents to have the school of their choice for their child if they wish their child to attend a nursery school. Not only does that help education but it encourages parental responsibility. That is much to be welcomed.
We are to have further reforms of grant maintained schools, giving them greater freedom. The recent announcement of my right honourable friend Mrs. Shephard that there will be 20 centres to raise the
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standard of literacy and numeracy in primary schools is also much to be welcomed. I am particularly pleased that we are to have a new professional qualification for head teachers. I gather that the pilot scheme will come into effect in September. That is a key recommendation because at the end of the day the raising of standards depends particularly on the head teacher as well as on the other teachers. That is more important than any of the other aspects that have been touched on. On the question of truancy, the publication of league tables has had quite a salutary effect on schools and again is much to be welcomed. The greater availability of information on schools, with the publication of performance tables in the past few years, has been very effective.
I was a member of a local authority for 15 years. During most of that time I served on an education committee. I do not recollect ever discussing the content of education. That was left to teachers and advisers. We dealt with other matters. But local authorities bear a responsibility for what has happened in the education service. I am not here to apportion blame, but the tragedy of falling standards must be shared by all those involved, including local education authorities. Our reforms have shown that where responsibility is handed back to the schools, which have elected teacher governors, and to the parents, and there is encouragement by testing, assessment and inspection to deliver a given curriculum, we can gradually lever up the standards. I hope very much that when my noble friend the Minister comes to reply he will be able to comment in more detail than I have been able to do in the time we are allowed in this debate.
3.30 p.m.
Lord Wallace of Saltaire: My Lords, I am glad that education has now risen to the top of our domestic national agenda. Education is, after all, one of the central functions of the democratic state. It is not something that should be left primarily to private choice. The education of all our citizens is, as 19th century Tories and Liberals alike recognised, a prime national responsibility. It is not a matter for privatisation, it is a public function and not a private affair. There have been some extraordinary ideas of the free market right in recent years, that picking a school is rather like picking a packet off the supermarket shelf—entirely a matter of private choice.
Education is about shaping the national community; building one nation; building the nation. That is why I, together with my colleagues on these Benches, regard education as the single largest priority for any future government. There has been a half-recognition of that in recent weeks by Ministers and their advisers in calls for schools to "teach morality", but that message is not connected to any wider concept of the role of high quality education in shaping society and citizens as a whole.
I would like to make several brief points. First, if education is something which should serve the community together, locally and nationally, it has to represent the community and it has to be tied to the community. That means that local government has a

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continuing part to play in organising our schools. It also means that schools should draw on our communities. I am happy that my children have been through the comprehensive system in a community school. It gave them a very good education; it taught them about the sort of society in which they are going to have to live. It also, incidentally, gave them a good quality education.
I regret very much the divide which we have, most of all in London, between private education for the wealthy and state education for those who, on the whole, cannot afford it. That is not the way to build an integrated national society, the one nation for which some of those even on the opposite Benches have reminded us we should all stand.
Secondly, we need a climate of opinion which values education and educators highly. It has become popular again in recent months to refer to the Asian model and how Britain should follow the Asian example. One of the most essential features of countries like Singapore, Taiwan, Korea and Japan is the respect given to education and to teachers. I very much regret that over the past 20 years it has been popular not only in the right wing press, but also among successive Ministers of Education, to denigrate teachers as failing in their job, as having easy jobs with long holidays and short evenings and as failing the country and even occasionally all necessarily being left wing. I recall a survey of university teachers which demonstrated that the large majority voted Conservative in the 1979 election. I suspect that a survey of secondary school teachers would have shown the same. I suspect of course that that is no longer true, but that is partly a response of my profession to the experience of the past few years. It has been a mistake of the Government to see teachers as a profession which one should criticise and not praise.
My third point is that high quality education cannot be achieved on the cheap. It represents a long-term public investment with a 40-year payoff. The quality of British education has deteriorated over the past 20 years, partly because too little has been spent on it. If we want to have good quality teachers then they deserve good salaries and secure jobs. The experience of the past few years—and I speak from my observation of education at secondary schools in Wandsworth and West Yorkshire—has been of successive cuts in staffing and in real spending, which means an unavoidable reduction in quality, in the diversity of courses offered and in the ability to cope with special needs, both of those with learning difficulties and of the brightest children in the school. My party has committed itself clearly and openly to telling the British public that one cannot have education on the cheap and that good quality education requires adequate public funding.
Declining standards in education and low morale among teachers will bring a long-term deterioration in our society, in our social cohesion, as well as in our economy. That is also true about school buildings. If one wants teachers to teach about responsibility to others, about the role which students should play in society, the buildings themselves will give a clear indication of how much society cares about those children who grow up within them.
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My fourth point is that secondary education is too specialised. There has been a consensus in this country for many years that we should move away from A-levels towards a broader secondary system. That has been blocked for political reasons, with calls for the "Gold standard" of A-levels to be restored. As a university teacher I find myself time and time again offering remedial education to my students in languages, history, a sense of the role of technology, politics and international relations because they did not learn those things in school.
We have to move towards a more general secondary education and, my last point, that means that we have to face up to the implications of all of this for the higher education system. We cannot allow Oxford, Cambridge and other universities, my own included, to say, "We require a level of specialised knowledge before you enter", which forces A-levels on the schools. We need to have to move towards a four-year undergraduate level of education. Again, that has been the consensus of many educators for a long period. We shall have to move towards higher spending on education by those who are taking it. I feel firmly that high quality education, properly funded, is the basic function of any government.
I regret that in many ways we have failed our students. We have failed to invest in our students who are this country's future.
3.37 p.m.
The Lord Bishop of Ripon: My Lords, on behalf of the whole House I would like to congratulate the noble Lord, Lord Wallace of Saltaire, on a maiden speech of high quality and stimulating content. I was particularly interested in his comments on the relationship between community and education, on which I shall be building later in my contribution. The noble Lord is a distinguished teacher of international affairs and international relations and that was evident in his contribution this afternoon. He brings wide and deep experience to your Lordships' House and we look forward with pleasure and interest to his future contributions.
I would also like to offer my good wishes to the noble Baroness, Lady Hayman, as she follows me in making her maiden speech in your Lordships' House this afternoon.
I offer my thanks to the noble Lord, Lord Morris of Castle Morris, for instigating this debate and particularly for his comments on the need for spiritual and moral education, with which I concur. I wish to speak now as chairman of the Church of England Board of Education and to begin by responding to the Government's announcement that the proposals for fast-track arrangements for Church schools to achieve grant-maintained status have been dropped.
As the announcement made clear, the Department for Education and Employment consulted widely not only with central bodies such as the one I chair but also with regional bodies and with schools. The overwhelming consensus of the responses was opposition to these arrangements on two grounds. First, the Church schools

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did not wish to be treated differently in this matter from all other maintained schools. Secondly, the Church schools valued the part played by parents in the life of their schools and did not wish to end the parental ballot.
Speaking on behalf of the Church of England, of the Roman Catholic Church and other denominations, I would like to welcome the decision not to proceed. Perhaps if consultation had taken place with the Churches at an earlier stage the Government would not have had to make an about-turn on this issue. We remain committed to working in partnership with the government of the day in the provision of high quality education for our nation.
The evidence both from that particular incident and more widely from Church schools is that the vast majority of them are for the moment content to stay with their local authority. Of the 4,160 Church-aided schools, only 276 have moved to grant-maintained status. Often particular circumstances have brought about that decision. In my own diocese, one Leeds Church of England high school took the decision because its governors were faced with finding £0.5 million for capital expenditure. By going grant-maintained, they ensured that that sum would have to be provided from government funds. A group of Roman Catholic schools in Kent took the decision because of a fear that the local authority would move towards a selective basis for admission.
The majority of schools value their links with the LEAs. There are sometimes considerable tensions between Church schools and local authorities over funding issues, but those tensions have not driven Church schools down the route to grant-maintained status. For Church of England schools—and, I think, for schools of other denominations also—that state of affairs is due to the decisions taken by Church school governors and parents. My own board has remained neutral on this matter, confining its role to offering advice on the issues which need to be taken into account when reaching a decision.
The vast majority of Church schools feel that they already enjoy self-government. They believe that they are offering that positive and good education of which the Motion before us speaks, and the numbers applying to Church-aided schools indicate that many parents share that view.
Although the picture that I have just painted indicates a degree of satisfaction with local authorities, it is clear that local educational structures need to change in shape and function. Here I speak not as chairman of the board of education, but as one with an interest in education generally, as a trustee of Education 2000 and as chairman of its Leeds initiative.
Education 2000 is putting forward broad proposals for the future of education. I am glad to say that those proposals are being considered by the three major political parties. Those proposals include a recognition that learning, not teaching, is the significant activity within education; that learning is a lifelong activity within which parents are the first educators but within which many people, in and out of school and college,
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will also act as educators; that it is the whole community of a given neighbourhood which is the learning community and which has to support learning in its many forms; that new forms of information technology are giving to learners powers to have access to information unparalleled since the invention of printing; and, above all, that learning is a natural creative activity of the human mind and person.
The proposals for change therefore include a high level of hardware and software to be available in schools and elsewhere; staff development in order to enable teachers to recover their proper role of inspirers and enablers rather than imparters of information; and curriculum development in order to make available new ways of learning and community-school development in order to involve parents, the local community and business leaders with one another. Those proposals are already being implemented to a considerable extent in Leeds Education 2000 with the help of additional financing provided by the Department of Trade and Industry and by business institutions both national and regional.
The reason that I speak of those proposals in this debate is that the community to which I refer is often a smaller neighbourhood than that covered by the local authority. In Leeds Education 2000 the neighbourhood is that of Chapeltown, Harehills and Burmantofts, an inner-city area with a high proportion of ethnic minority families, a population of about 80,000 and two high schools, one county, one Church, together with their feeder primary schools. Leeds Education 2000 has already brought about a change in that neighbourhood. It has involved both elected members and officers of the Leeds education authority in its management.
If imitation is the sincerest form of flattery, Leeds Education 2000 should be flattered since the local authority has now introduced the notion of the "family of schools" to which the noble Lord, Lord Morris, referred. The idea of the family of schools began with Leeds Education 2000 and has received mention in the Labour Party's document Excellence for Everyone. That document contains a specific reference to Leeds and it is gratifying that some of Education 2000's ideas are taking hold, but it would have been even more gratifying if Leeds education authority and the Labour Party had acknowledged their source. It is also gratifying that in a personal letter to the national chairman of Education 2000, David Peake, a former chairman of Kleinwort Benson, the Prime Minister asked that his office he kept in touch with developments in Education 2000 and with the Leeds initiative.
If ideas similar to those of Education 2000 are to progress, we need a unit which is smaller than a local authority but larger than a single school. It is only in that way that the sense of a community as a learning organism can grow and that schools can be available and accountable within their communities as one set of institutions within which learning is fostered.
Excellence in education is a matter of each young person growing to be the best of which he or she is capable. If that is to happen, education must cease to be a political football and must become a community

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concern, a concern for all of us collectively and each one of us individually, for each one of us is both learner and educator.
3.45 p.m.
Baroness Hayman: My Lords, I rise to make my maiden speech in your Lordships' House some 17 years after I made my last contribution in another place and began a rather extended career break, precipitated by the result of the 1979 general election. In the Labour Party that phenomenon is somewhat unkindly known as being a "retread". The labour market speaks rather more officially about the phenomenon of the "married woman returner". It is as a married woman returner to political life that I speak today in your Lordships' House.
Since 1979 I have been lucky enough to be involved with a variety of activities and organisations in both the public and the voluntary sector, but my main preoccupation has been with raising my own family. Perhaps I may say on a personal note how very proud I am that that experience has been considered of value and relevance to considerations in this House, despite the effect that it has had on my own curriculum vitae in making it slightly less conventional than those of people who have had full-time careers.
That makes it particularly apt that my first contribution in your Lordships' House should be on the subject of education, because for those 17 years I have seen children through nursery, primary and secondary schools and I am awaiting with interest the phenomenon of having a child at university. I still have three children who are pupils in state primary and secondary schools. During that time I have also been a school governor almost continuously.
Every maiden speaker is anxious—not only about the content of his or her speech, but about the formalities of your Lordships' House and the conventions that we should obey. I am not sure whether the Addison rules apply to being a school governor. I certainly have no financial interest to declare, but I have the deepest and most personal interest possible in the quality of the education that is provided in our country's state schools—that of a parent who, like any other parent, is concerned that their child's future is dependent on the quality of the education that is provided by those schools.
However, I believe that we in this House should be concerned not simply as parents who are concerned for their individual children but because the quality of the education that we provide to our children aged 3 to 19 years is of national interest. I firmly believe that, if we look to the next millennium, the future of this country economically and socially will be dependent on the investment that we make in education and training now. If we are to face the generations to come with a workforce at all levels that is skilled and qualified, we have to be prepared properly to resource the educational needs of that workforce. What we do in education and training will determine whether in the future we compete as a high wage, high skill, high-tech economy in the year 2000 or relegate ourselves to competition as
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a declining economy with a low wage workforce. That is of crucial importance and it makes the debate about education of crucial importance to the nation.
We should he concerned about another national interest—I refer to the social fabric of the nation. There is a risk, which we all see and about which I think we are all concerned, of the alienation of groups of young people: often they are out of school, they are without qualifications and without any hope of getting a job and they pose a real threat to themselves, to their families and to the community as a result of that. alienation.
The schools have a tremendously important role to play as regards children whose lives have often been damaged elsewhere. However, we ask schools to care for such children, to contain them and to reverse much of what has happened in their lives without ever giving the schools the resources to do the job properly. It is easy to criticise the school for suspending those pupils. That is much more difficult if, like me, one has heard appeals against suspension and has tried to weigh the responsibility for caring for the individual child against the responsibility for the institution as a whole and for the child's classmates. We cannot ask our schools to do that job without giving the teachers the resources that they need to do it properly.
The other injunction of your Lordships' House upon maiden speakers is to be uncontentious. That too is difficult as regards this subject and I hope that your Lordships will understand anything I say now will be in the nature of a comment on our national performance in education rather than making specific criticisms of the current administration. That I trust I shall have the opportunity to do in the future on a number of subjects and at some length.
I believe that the educational debate in this country and our performance in education have been bedevilled by two phenomena. One is the divisiveness for a nation of a system in which a significant proportion of its children are educated outwith the state system and in which, because they do not use it, a significant number of parents who are often influential have no personal stake in the quality of the education service that is provided by the local authorities.
Within the state system we have been bedevilled by an overwhelming concern about the interests of perhaps 20 or 25 per cent. of the most academically able but we have not been equally concerned about the interests of the remaining 75 per cent. of pupils, and our nation cannot afford to take that view. There has been much debate recently about the possible neglect of the interests of the middle classes. I suggest that if one looks at our performance in education one sees that we should have been looking at quite the reverse phenomenon.
I am straying into areas of contentiousness and in doing so I shall stray into the area of speaking for too long and overstaying my welcome. I hope that on other occasions I shall be able to discuss in this House how to promote and monitor quality within our schools, the value of setting by ability and by subject within the comprehensive system and the need to reform A-levels.

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I conclude by urging your Lordships to adopt a passion, perhaps not as parents but as grandparents. However, when I arrived in this House I was surprised at the relative youth of those on the Government Front Bench and I exempt them. Some of them look so young that perhaps they will have the passion as pupils. I ask your Lordships to adopt a passion about the quality of education in our schools and thereby to become stakeholders in the future of our nation.
3.54 p.m.
Baroness Perry of Southwark: My Lords, on behalf of the whole House, it is my pleasant duty to congratulate with ease and sincerity the noble Baroness, Lady Hayman, on her maiden speech. By happy serendipity, she and I are old girls of the same school as well as being graduates of the same university. Furthermore, we both share the experience of having spent many years raising children rather than being active in paid employment. I am inclined to remember a remark made by one of my Canadian contemporaries who was raising her children at the same time as I was raising mine. She said to me, "We should never complain of these years out of paid employment. They are our fallow years and in these fallow years we do grow rich". Listening to the noble Baroness, Lady Hayman, it is obvious that she has indeed grown rich in her fallow years.
There is total agreement on all Benches that we aim overall to have good quality education for our young people. Perhaps it would be churlish of me to say that the Benches opposite have little to celebrate in the performance of schools during the 1960s and 70s when the Labour Government was in power for much of the time. Then the majority of our young people were sent out with inadequate skills for adult life and almost half of them were sent out with nothing of any coinage to show for their 10 years of schooling. I am happy to be a member of a party which since taking power has done much to remedy the state of our abysmal education system.
I am not sure that we entirely agree on the definition of a good education. For me, and I think for the Government, the definition of a good education is one which enables young people to achieve. I was interested to see that recently in this House noble and learned Lords gave judgment that it was the duty of a school overridingly to assume responsibility for the educational needs of every child. They added:
"If it comes to the attention of the headmaster that a pupil is under-performing, he does owe a duty to take such steps as a reasonable teacher would consider appropriate to try to deal with such under- performance".
Allowing the underperformance of our young people is the greatest crime of any school. Allowing a child to leave with less than the achievements of which he or she is capable is the most abysmal failure of a society. I do not blame teachers or schools; I say simply that the aim of all government policy must be to increase the achievements of our young people and to provide good quality education and teaching appropriate to the child's
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particular needs, enabling him or her to take a place in adult life. The way in which one achieves that is constantly debated and is a matter of concern to us all.
I shall take up only two issues in the debate today. The first is parents, and I start deliberately with them. A school or an education system by itself cannot achieve success. There must be a partnership with the parents and the home and there must be a sense of sharing of aims and goals. That is why in recent years the Government have increased parental involvement. First, by increasing parental choice: parents have now a much greater diversity of schools and therefore greater freedom of choice. The Parent's Charter promises not only that parents will have a free choice as regards their child's school but also that they will have a right of appeal if they do not get their choice. Much more important than choice at the beginning is their right throughout their child's schooling to appeal to the school for information and better understanding and for the school to give them a full explanation of everything that goes on. I wish that had been the case when my own children were going through state schools. The reality was often far from that.
In recent weeks we have heard much about how the ability of G.M. schools to increase their range of selection somehow denies parental choice, as if the parental choice and school choice were mutually exclusive. I find that most odd. I work in the higher education system where we find it most comfortable, indeed an expected matter of course, that while students select a university to which they wish to apply, the university then selects the students who are best suited to succeed within its particular aims, ethos and standards. Why should we deny that particular right to schools? I very much welcome the extension of school selection. I believe that selection is the real route to long-term quality within schools. For example, 15 per cent. selection within one of the inner city GM schools—and there are many, many GM schools in inner cities—will enable it to ensure that it has a better balance and mix of pupils.
Why is there an almost religious belief in the power of the LEAs to put everything right? I am sorry to say that the LEAs did not always put everything right. There are good, wonderful, excellent LEAs and there are poor LEAs, as in most other walks of life. But no one should, or I think would, claim that LEAs alone are the single answer to improving standards.
I am afraid that to the ordinary parent, city hall or county hall is as remote as Whitehall. If the party opposite is serious about its stakeholder society, it should give parents within a particular school a real stake in the running, management and decision-making of the school. That is what the Government have done in grant-maintained schools because parents and children in those schools have a real stake in their day-to-day performance.
Secondly, I turn to teachers. Yes, 70 per cent. of lessons seen by Ofsted were satisfactory. That is not good enough but, nevertheless, it is a very large number. The National Institute of Economic and Social Research report tells us that the reason for the poor performance

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of many of our children is because teachers have too low expectations. I believe that this Government have conveyed in a clear and unequivocal measure to teachers that their job is not to be social workers, not to create social engineering and not to create educational experiments but that it is to help pupils achieve and perform. By doing that, they have begun to turn round the clock. It is astonishing that through the publication of performance tables, through the laying down of a national curriculum entitlement for every child and through regular national testing, pupil achievement in this country has been raised and I believe will continue so to be.
4.2 p.m.
Lord Quirk: My Lords, the noble Lord, Lord Morris of Castle Morris, to whom we are indebted for this debate, has been—like me—a professor of English and we must not ignore the responsibility that university professors bear at all levels of education.
So far as our schools are concerned, much perhaps of what is needed to raise our deplorable standards is already in the pipeline. It will not be long before all school leavers will have had their entire education enlightened by a national curriculum. We are already feeling the benefits of a vigorous Office for Standards in Education and a watchful curriculum authority. We see a growing acceptance of the need for regular periodic testing; acceptance too that competition between schools is as healthy in classroom achievement as it is on the sports field; acceptance that individual success is far better than collective failure, and that we should pursue quality ahead of equality to get a measure of the sort of equality we should be seeking. Not least, there is a new consensus to reassert the primacy of the three Rs, whether or not buzzily disguised as "core skills".
Now, two of the three Rs fall squarely within what most of us (and especially, one would hope, professors of English) would recognise as English. But in numerous universities what we used to call the discipline of English is itself opaquely recoded in buzzwords like media studies, communicative arts, cultural studies and so on. But however styled, the university departments concerned tend to favour cultural relativism, and since it is from among their graduates that our schools recruit their teachers, it is hardly surprising that the new consensus that I have been optimistically rehearsing is by no means complete among schoolteachers themselves.
An element—a minority element I profoundly hope, but certainly an influential and articulate element—is engaged in highly audible dissent. It is the element that impressed on Sir John Kingman during his 1988 inquiry how widespread is the view that,
"any notion of correct or incorrect use of language is an affront to personal liberty".
Such views did not evolve from the teachers' own experience of teaching in school. They brought them, ready made, from universities which promoted these ideas and which promote them still.
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I quote from a very new hook (1996) by a very distinguished professor of English,
"as teachers of English … our ultimate aim … should be social revolution, since unjust privilege in a destructive system will not willingly be surrendered".
The author is a learned Oxford graduate and Rhodes scholar who happens to be an American. But his doctrines are easy to match among many British academics. A current professor of English at Oxford is on record at saying that for a department to teach English literature is to make it,
"part of the ideological apparatus of the capitalist state",
while another current Oxford professor of English sought to destroy the other main plank of the English curriculum in addressing a month or so ago the theme:
"Does Standard English exist and should we teach it?"
Logic surely entails that the second part remains non-vacuous only if the answer to the first part is "Yes" but this professor contrived to give a defiant "No" to both parts.
Writing in a recent issue of the official voice of University English, a professor al Loughborough University claims that the new school attainment targets "reveal dangerously reactionary influences", and a professor at Sheffield Hallam University has, in another teachers' journal, attacked this same national curriculum because it,
"smacks of a right-wing witch hunt against so-called 'slovenly' speech, spelling and punctuation".
Mark that "so-called", my Lords.
Mark also, come to that, marking itself. From a sample inquiry last year, it appears that an alarming number of university teachers of English in this country (but not of course in Germany or Japan) firmly decline to correct the written or spoken English of their students: not, they say, because such pedantry is beneath them, but because correction inhibits the creative flow, grossly intrudes upon a student's "space" and personal values, and unwarrantably implies that language can be reduced to crude judgments of good and bad. No wonder professors of physics, engineering, medicine ask themselves what on earth their colleagues in English are supposed to be doing.
We often speak of this irresponsible if not subversive mindlessness as though it flourished 30 years ago and then vanished. But how could it vanish? A good few youngsters who imbibed such pseudo-idealism in the 1960s are now senior university professors themselves, often with their own pupils already in chairs too, the more creative of them adding their own refinements by way of cultural relativism and political correctness.
Well, crackpot enough at the point of delivery, what about the receiving end? What about the mere shards that splinter 20 year-old minds, patchily attending, half comprehending? Do they form an intellectual basis for graduates to go out and start teaching in school? How are such ideas put to actual classroom use even by teachers with a first from Oxford, let alone the far greater numbers with lower seconds from universities lower down the pecking order?

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We depend on schoolteachers for the quality of schooling that this debate rightly calls for, but it is on university teachers that we depend for the quality of ideas that get into the schools. I commend those professors of English who raise their voices to urge a greater sense of public responsibility in the exercise of their academic freedom; for example, Sir Frank Kermode, in his Maccabean Lecture at University College London last November.
Finally, let me quote from the recent words of that eminent American critic and professor of English, George Levine, who has called on all professors of English (well, he makes honourable exemptions no doubt, and maybe even some noble exceptions) to plead collective guilt for the students we ill-direct and for the taxpayers who are unable to understand why we teach their sons and daughters,
"to believe that their values (which sent the children to college in the first place) are wrong".
4.10 p.m.
Baroness David: My Lords, I have always had a great interest in children with special needs and, in particular, what happens to them at 16, when official schooling ends. They have often had a raw deal then. The LEA retains the key responsibility for these children. Today I want to talk about the current developments in education for 14 to 19 year-olds, with special reference to those pupils, and particularly in my own county of Cambridgeshire which is planning to tackle the problem with its New Agenda.
The project aim is to realise the maximum potential of all young people by providing an accreditation and learning framework which values, records and accredits the vocational and academic achievements of those who are unlikely to attain the equivalent of NVQ1 by the age of 16. This accreditation will enable those young people to progress more easily into further education, training or employment. The target group for the three year project will this year be those in year 10.
The national targets for education and training were based on the CBI's world class targets in, Towards a Skills Revolution which stated:
"Those with special needs have been excluded from the targets in the time scale envisaged".
Thus a set of national targets was established which from the outset excluded a significant minority. All students need the satisfaction of achievement recorded and progress measured. There is a continuum of need, and an accreditation system is required which reflects that.
The Chief Inspector's annual report into standards in education noted of the provision for students with learning difficulties that,
"too often students repeat courses or modules, and there is little evidence of progress: when students are given an opportunity to work towards recognised qualifications this generally improves their level of attainment".
So the gap and the need is fully recognised. A recent project funded by the Greater Peterborough TEC's special needs group into attitudes of employers and
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special needs students indicated an urgent need for a clear, coherent and recognised record of core and vocational skills, to give students self-esteem and credibility with potential employers. And that is precisely what Cambridgeshire is intending to do with its new project.
The fact that there are 16 special schools in the county and altogether 2,109 statemented children, with 246 of them in year 10, is some demonstration of the need. As well as those, there are the increasing numbers of disaffected pupils in special units: 55 in 1992–93, 102 in 1993–94. No doubt there are more now. And of course there are many others without statements who will have no hope of reaching Grades A to C in GCSE, which is what employers look for in taking on young people.
What Cambridgeshire wants to give young people is a certificate which they can show and which will have credence and carry weight with either employers or those involved in any further training. This certificate will record the core skills—pace the noble Lord, Lord Quirk—that they have managed to acquire: communication, numeracy, information technology, personal and social skills, to name a few. Special schools in the county are currently seeking accreditation for their students in various ways which include: RSA practical skills, the Youth Award Scheme, the Vocational Access Certificate and various G/NVQ units at level 1. Now all these could be registered on the accreditation certificate and be part of their record of achievement. What is needed is that there should be a national recognition of such a certificate, so that young people moving around the country could carry it with them and it will have meaning wherever they may be. They need this for their future livelihood and for their own self-esteem.
The current developments in the 14 to 19 curriculum stem from three main sources: the TVEI which pioneered the new approaches which revolutionised education for so many pupils; the Dearing reports on the national curriculum and post-16 education and the national training and education targets. What I believe from Sir Ron's agenda for the 14 to 19 study is that he wants to improve the qualifications and accreditation of the low achievers. I am sure that the noble Baroness, Lady Perry, will agree. The quality of their educational experience would thus be enhanced.
The way forward is through local partnerships and this is what is happening in my own LEA, with the co-operation of the two TECs—Camtec and Greater Peterborough TEC, with, of course, input from the Careers Service which, although now privatised, works very closely with the authority. The LEA needs, indeed, to work with the FE colleges, the GM schools and a range of voluntary and private sector interests. Much time and effort is put into liaison and co-ordination. The "enabling" LEA needs to have this co-ordinating function properly recognised. It is the LEA that has to provide the overview.
Increased staying on rates and increasing examination successes build on the work of LEA institutions and the trends established before the current fashion for

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removing functions from them. The next more difficult bit of progress is doing what I have been trying to outline today—to attract the disaffected and disadvantaged, those who have failed or been failed by the system, and to encourage them to continue their education and help them to achieve a measure of success, with something to show that they have achieved that success. The education and training opportunities must be attractive and relevant. And that requires local effort in partnership, rather than further central directives or administrative changes.
4.16 p.m.
Lord Skidelsky: My Lords, I should like to thank the noble Lord, Lord Morris, for giving the House the opportunity to discuss what is probably the most important domestic topic facing this country. I should also like to give a very warm welcome to the maiden speeches of the noble Lord, Lord Wallace, and the noble Baroness, Lady Hayman.
I have known the noble Lord, Lord Wallace, for a long time and I am sure that he will prove a doughty fighter for liberal causes. As he referred to the Pacific Rim, I think that I should mention that about 30 per cent. of its educational spending comes from private sources: mainly from parents' fees—an innovation which I hope that the noble Lord's party will support if it is ever put forward from these Benches.
I do not agree that it is a consensus view that A-levels should be scrapped. It is certainly not my view; and, indeed, it is certainly not the view of many university people. Many of us fear that it would lead to a lowering of standards rather than a raising of them.
The propositions of the noble Lord, Lord Morris, are worded so amiably that it would seem churlish to criticise any of them. Yet there are some peculiarities in the wording that point to deeper problems. I doubt whether most 19 year-olds would appreciate being called "children" as they are in the Motion. I detect the whiff of Nanny here. So far as I am concerned, by the time they are 17 or 18, most young people are perfectly capable of making up their own minds as between the labour market and further education. The state's role, in my view, should be limited to providing means-tested tuition fees and other maintenance support for all those accepted by accredited educational institutions to continue with their eduction. I do not believe that the state should be in the business of telling 19 year-olds how they should proceed with their lives. They are no longer children. I know that that is not what the noble Lord intends, but the Motion is worded in that way.
If we turn to the other end of the age group—the children of three—I am not at all sure that we should he in the business of encouraging state baby snatching. Wresting children from the control of their parents has always been a favourite aim of collectivists and we should not lower our guard against that simply because it is dressed up in well meaning language of nursery education. The case for starting on state education at the age of three has to be made much more powerfully than it was today and than I have seen it made. I have always
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had serious doubts about the Government's nursery voucher scheme which creates a general entitlement to pre-school education for all four year-olds, not least because it will kill off the largely voluntary play groups which now provide for a quarter of four year-olds in this country.
It has always struck me as extremely odd that a party which believes in family values and in the voluntary sector should have taken a giant step towards nationalising pre-school education, because that is what it is; it is not there at the start but that is what it will lead to. With the extension of state funding will come the extension of the domain of the Secretary of State. Thus it always was and thus it will be. I know this extension is based on the well meaning idea that it will improve school standards, improve morals and prevent social problems later on.
Obviously I would agree that children from what are curiously called disaffected backgrounds may benefit from pre-schooling experience, but even here we should at least be sceptical. A major 1985 study by the US Department of Health and Human Services of the Headstart programme, which has been running since 1965 and was designed precisely to provide experience of pre-schooling for disaffected families, concluded that by the time children reached the age of eight:
"There are no educationally meaningful differences on any of the measures between poor children who went through Headstart and those who did not".
The programme currently costs nearly 5 billion dollars.
Yet, if I understand the Motion, supporters of the noble Lord, Lord Morris of Castle Morris, want the entitlement for four year-olds to be extended to three year-olds and the whole entitlement to be funded more lavishly than is now proposed. If this is done, the extra cost will certainly run into the low billions in the full maturity of the scheme. If we believe that education is being underfunded, is this where we should be putting the money? Surely the priority should be to reduce class size in the first years of primary education. The recent Ofsted report Class Size and the Quality of Education shows clearly that while in general class size has little effect on educational standards, it does in Key Stage 1 where the smaller the class, the higher the percentage of good lessons.
Let me conclude by saying a few words on the role of local authorities. I do not want, any more than anyone else on this side of the House, to knock them. When they are good they are very good and when they are bad they can be extremely bad. I wish to make two constructive suggestions. First, LEAs are not currently obliged to publish the results of standard reading tests which most eight year-olds take. Therefore they do not do so. Only the Secretary of State can force them to do so and she has not yet done so. Nor are local education authorities obliged to publish the results of Key Stage 1 tests. Parents are thus being deprived of essential information about the quality of schools in their areas and there is a seven-year gap in the national monitoring of school standards. I believe LEAs should be obliged to publish, school by school, the results of all standardised tests taken in primary schools.

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Secondly, I should like to see established in each educational area an education information centre in attractive premises in which parents can find out what they want to know about the schools in their area and be offered help and guidance in selecting schools to fit the needs of their children. If the LEAs took these two steps to disseminate information to parents, I believe they would find both a good use for the funds they now hold back from schools and would do much to fulfil the role which the noble Lord, Lord Morris of Castle Morris, wants of them—that of "guardian and raiser of standards".
4.25 p.m.
Baroness Fisher of Rednal: My Lords, I shall speak wholly and entirely about the City of Birmingham. That is a local authority which the Government do not like much. Any brickbats they can aim at the City of Birmingham, they do so. It was two years ago that Birmingham received a highly critical report on educational performance as its schools did badly in league tables. That report failed to take into consideration the fact that the school population scored significantly higher than the national average on all the main poverty indicators.
One-third of the city's pupils are registered for free school meals; that is, one-third of 170,000 pupils are registered for free school meals. In some schools as many as 90 per cent. of the pupils receive free school meals. That shows the level of poverty in the area, and poverty obviously is related to educational standards. Nevertheless, the city recognised that there was an urgent need to raise standards. A new director, Professor Brighouse, was appointed, together with a new chairman. The new chairman is Andy Howell, the son of my noble friend Lord Howell who is not in the Chamber at the moment. They and the education committee laid overall plans for the 500 schools in the city. The plans involved a partnership with parents—many noble Lords have referred to that partnership—and a Home-School PACT with parents was asked for. Specialist advisers were employed by the local authority and outside education professionals offered advice. A teachers' training centre was opened; all the schools in the area could send teachers there. The teachers would then put into being what is called an assessment on pupils entering school. That is not a test of pupils entering school but an assessment. That assessment had to be varied to make it suitable for a large percentage of the children in the schools in the area who do not have English as their first language. Obviously those children have to be assessed in different ways.
The assessment starts in the primary schools and is carried out progressively until the children pass into the senior schools. This progressive assessment seeks to match the children's original assessment or to improve on it. Where it is noted that an assessment is going backwards as it were, strong steps have to be taken by the school concerned to find out why that occurred. We now have in the schools in the area Home-School PACTs. These have now become common in the
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schools, especially in those schools which need it more than others. Many parents cannot he helpful when their child asks for assistance with homework or regarding some discussion at school because they themselves are not particularly well educated. Many schools use the Home-School PACT programme. Many schools have a room which parents can use. Parents are not stopped at the school gates. They come in and use the room with teachers who seek to be helpful, and volunteers—often parents who have had children at the school—who come in to assist parents who cannot help their children. While the parent role may be defined as co-educational. many parents become co-learners.
Noble Lords have spoken about neighbourhood schools. In Birmingham we have neighbourhood schools, but these are governed by the main A-roads through the city. A district becomes an area formed by those main roads which contain the neighbourhood schools. Those schools concentrate on events in their neighbourhoods. They work with factories, firms, banks and other organisations in their own neighbourhood, and with the fire brigade, the police, and so on. The neighbourhood school becomes a living entity. There may be three or four schools in the neighbourhood.
Many departments of the city council are behind this thrust to give greater opportunities to the pupils in schools. In Birmingham the central library has the first child learning centre. It is available at all times that the library is open. Parents take their children to the centre and educated staff advise. It is a learning centre for children as regards the way in which one uses hooks. It is quite unusual and does not occur in any other part of the country.
Staff are now employed in the museum and art gallery. When schools visit, those staff have been told what a school wishes the children to see in the museum and art gallery following what has taken place in school. Special staff have taken on that role in the art gallery and museum.
Around the City of Birmingham we have a green belt. In many of those areas we have what are called country parks, with buildings that the general public can use in which there is a learning area. Rangers employed by the country parks give nature talks. All those people have an input into the system.
The Royal Ballet in Birmingham goes into schools and demonstrates forms of dance. There is also the Birmingham Symphony Orchestra. The enthusiasm, the commitment and the new initiatives from head teachers, all members of staff, and from parents, continue. The Government need to recognise that the situation on the ground must be considered differently in different localities. One must ensure that financial cuts do not harm the most vulnerable children.
4.33 p.m.
Baroness O'Cathain: My Lords, it is good that your Lordships' House should devote time to debate this subject in a space not dedicated to a Second Reading debate. I thank the noble Lord, Lord Morris of Castle Morris, for instituting the debate.

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On first consideration it may seem strange that I felt that I should like to take part in the debate. I have no children and indeed I have no direct experience of the education system in this country having been educated in what has sometimes been called John Bull's other island. I have no experience other than as an "end user" of the product of the education system—an employer. However, I feel that that qualifies me to make some observations and even some suggestions.
More important, I think, is the deep concern that I feel for the future of this country as a whole, not just the labour force. I believe that education—the standards, the system, and the results—are all of vital importance to the future of this country.
The subject for debate is in two distinct, although linked, parts. I intend to speak only to the first part, namely,
"The need of children aged 3–19 years for high quality education".
As a bald statement there can be no disagreement with that. I defy anyone to state that there is no need for education for children aged 3–19 years. Where the disagreement is likely to occur is in the analysis and recommendations of the means by which to achieve the objective.
In preparation for the debate I have been looking at data concerning developments in the recent past in the provision of such education. I deliberately took the period from the beginning of the 1980s. That was to ensure continuity in my knowledge base from the data I had been aware of during the 1960s and 1970s.
During the 1960s and 1970s something seemed to be woefully awry with the education system in this country. This is not the place to develop an analysis of why. Suffice it to say that the end product of British schools—or should I say English schools?—was certainly substandard in the knowledge of the basics of the three Rs; in powers of analysis; and, frankly, in not being "up to it" in the competitive world of international business. That is the personal observation of an erstwhile employer who was constantly amazed at the inability to spell, to construct sentences in letters, and to do simple mental arithmetic. But probably even worse was the complete disinterest in the love of learning and pursuit of knowledge for its own sake. Time does not permit me to give example after example drawn from my personal experience. It was just a huge, sad eye-opener to me.
I believe that this has changed. More than that, I know that it has changed. It has changed because of a much more focused attitude to the sector. I shall not repeat, almost word for word, the words of the noble Lord, Lord Quirk, at this point. I agree with everything he said about the great improvement. The more focused attitude has, in addition, resulted in good husbandry of the huge expenditure on education and has had the result of making our young people more confident of their achievements, thereby ensuring that they can play the essential role in the increase in wealth and competitiveness of the economy.
The national curriculum indicates a return to a more formal education programme. Gone forever I hope are the days when pupils were encouraged to be "creative"
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and "project involved" to the detriment of the learning of the basic skills of the three Rs, the knowledge of history and the inculcation of a love of learning and thirst for knowledge.
However, I have two concerns. The first is that I believe that we as a society are in danger of overloading the teachers. The second concerns the current perceived vacuum in the teaching of values which are so essential for each and every child.
Education in my time as a three to 19 year-old was seen as a partnership. I was interested to hear my noble friend Lady Perry use that word also. I saw it as a partnership between three distinct groups: parents and the extended family, the schools, and the Church. Sadly, that three-legged stool looks decidedly lopsided now. It does not require me to tell your Lordships that the family is no longer an area where children can be assured of education—using the word in its broadest sense. The prospects are that some 40 per cent. of our children will be brought up by a divorced parent or a single unmarried parent. Economic pressures lead to an ever-increasing number of latch-key children where the adult with responsibility for the child is so worn out at the end of the day or week that sitting the child in front of the television seems to be the only way of coping.
The Church no longer seems relevant to many people in the field of education. Of course it is relevant to the 11.7 per cent. of the population who regularly attend church. My figures are from Social Trends, the 1995 edition.
The noble Lord, Lord Morris of Castle Morris, stated firmly that all problems besetting education are the fault of the Government, with the,
"buck stopping on the desk of the right honourable Mr. John Major".
I trust that he would accept my partnership analysis that parents are stakeholders in education. Is my right honourable friend the Prime Minister responsible for the high divorce rate, the high incidence of single parents, or the rejection of the Church by some 88.3 per cent. of the population? No, of course not.
Although I am by nature an optimist, I cannot see the pattern changing. On a practical level, the family just cannot fulfil the responsibility. The dispersal of the family, as opposed to the breakdown of the family, is seldom mentioned. No longer can parents rely on the influence and encouragement of grandparents, aunts and uncles. How many of us live in the same place or town, surrounded by the same relatives or friends as when we were born? The erstwhile support structures are no longer in place. Sadly, most children find themselves as "islands"—John Donne's poem is difficult to equate with today's situation.
My concern has in part been addressed by the measures relating to nursery education. Indeed, it has also been addressed by the greater involvement in education of parents. But teachers are increasingly the beasts of burden. Some are cracking up; some do not care. Some, however, are tackling the problem head-on and shaming the rest of us with their dedication.
Last year I was involved, at the behest of the noble Earl, Lord Longford, in a quite amazing project run by a teacher in the London borough of Southwark. My role

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was to try to help with advice on fund raising for the project. Briefly, the project involved a partnership between the schools in Southwark and Dulwich College. Children from schools in that deprived area living in substandard housing were bussed to Dulwich College every Saturday morning. The teachers at the college gave up their time to teach the children who had a thirst for knowledge. The project is organised by a teacher and last year the drop-out rate was 5 per cent. The children and teachers voluntarily give up their Saturdays. After a bit of arm-twisting, local business is giving money for the project. The teachers are wonderful. They should be much more valued than they are, not necessarily in financial terms but in the respect we should all show for what is a truly worth while vocation.
My second concern is the perceived vacuum in the teaching of values. As a Christian I look for the values I was taught, constantly referring to the Bible—both the Old and the New Testament. Who teaches our children, as Isaiah states, to
"know enough to reject the wrong and use the right"?
Or in New Testament terms, are we ensuring that our children will,
"grow in wisdom and stature and in favour with God and men"?
Again, values were to a great extent a partnership between home, the church and school. The same problems of reduced influence of the first two partners exists. But in this case, if children are not taught values, they will make up their own framework of values anyway. The question is: what framework? Where does the ultimate responsibility end up? With the school, for the most part, I fear. But if we have teachers who openly state that "values are subjective and are, therefore, no part of the school's responsibility", as I heard on the radio on Monday, we have a problem. Yet more demands are being put on the educational system—overload, I fear.
We seem to have reached the answer for conventional education but not yet for what I would call "education in the round"; namely, educating our young people to take their rightful place in society. It would be wonderful if the issue could be approached on a bipartisan basis, with the best brains marshalled to try to help the teachers. A debate like today's is useful in drawing attention to such issues. Let us hope we can come up with some answers.
4.42 p.m.
Baroness Nicol: My Lords, I shall devote my few minutes to discussing the need for nursery education. I declare myself to be one of the happy band, together with the noble Baroness, Lady Perry, and my noble friend Lady Hayman, whose career—if it can be described as such—was interrupted in order to bring up three children. For about 16 years I devoted myself to them entirely. But even with my undivided attention, it was obvious that they would have benefited from an expansion of their horizons with nursery education from certainly the age of four. However, it was not available to us since my husband was living on a scientific
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research grant, we could not afford private education and no state places were available. Thus, even so long ago, I became aware of the need for nursery education.
Then for some years I was governor of a primary school in a rather deprived area. The reception class teacher—there was usually just one—had to spend part of his or her time in teaching some of the children how to speak to each other. They were English-speaking children, at that point none came from ethnic minorities. But they had not enjoyed any kind of what we would describe as "social contact" and they were quite unable to communicate with each other in what we would consider a normal way. Not the whole class but one element—perhaps a third of the children—was in that category. So a good part of the first year in the reception class was wasted in terms of normal primary education. There was a knock-on effect because the rest of the children in that class were deprived of the attention which otherwise the teacher would have given them. The noble Lord, Lord Skidelsky, mentioned that class size was important in primary schools and I agree. It is particularly important in the reception class.
It is ridiculous to suggest that equality of educational opportunity exists in those circumstances. The children fall behind at the very beginning of their school career and some of them can never catch up. The feelings of frustration and failure which result are at the root of much of the trouble with disruptive children later on because they never feel that they are equal partners in their class. Later still I believe that the disruptive children go on to have less regard for the laws of a society in which they have never felt properly at home.
Even when the home background is good, many children need to gain confidence in mixing with their peers. All children benefit from the mental stimulation which a good nursery class provides. The noble Lord, Lord Skidelsky, quoted, I think, an American experiment, but results are available for experiments in this country which prove beyond doubt that at least a year of nursery education benefits children and brings them on at a much more satisfactory rate so that they benefit from their primary education.
If the Government are serious in their stated commitment to a classless society, then they must start at this point. It will be difficult enough for the children anyway, but without the benefit of their year of nursery education it is hopeless.
So what is the position? There is a shortage of nursery places; everyone agrees on that. The Government have proposed a voucher scheme with which I gather the present Secretary of State is not entirely happy. However, we will let that pass for the moment. It is said that it will enable parents to buy places for their offspring in the establishment of their choice:
"putting power in the hands of the people",
according to the Secretary of State for Education in her original statement. The difficulty from the point of view of the parents is that places in some urban areas are scarce and in some rural areas non-existent. As for choice, it seldom exists in practical terms. Even if the voucher scheme works and becomes more widespread than it looks like being at present, the time lag between

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the demand for places and the supply will mean that whole generations of children are still deprived of the nursery education they need. Why must the voucher scheme be handled by a private sector company? How many companies have expertise in the field—apart, possibly, from Camelot in that context? Will there he a ceiling on their profit margins or is that something which the taxpayers will also have to fund?
If, as is feared, the voucher system undermines the existing provision, then in the short and medium term the situation will become even worse. The Government pin their hopes on market forces yet again. In any case, the private sector provision, if started in haste in response to a perceived market opportunity, may not achieve the standards that we all have a right to expect. The Secretary of State for Education said that there would be,
"a light touch inspection framework".
That promise does not sound much of a deterrent to the unscrupulous provider. Even at the moment those schools that are subject to inspection are not inspected often enough. What is meant by "a light touch", I simply do not know.
I suggest that the best way to achieve the result that we all want quickly and effectively is, as my noble friend on the Front Bench said, to enable the local education authorities to do the things that they are best at. They understand the needs of their area. They have knowledge of the local population and they have the expertise to use that knowledge effectively. My noble friend said that they were noted for their vigorous and inventive action; and so they are. They are also—and this is very important—accountable to local voters for their actions. If at the end of the day the provision that they make is not adequate, they will pay the price. Therefore I hope that we shall press on with general provision of nursery education, and that it will at least be in the control of the local education authority.
4.50 p.m.
Baroness Warnock: My Lords, I am very grateful to the noble Lord, Lord Morris of Castle Morris, for initiating this debate. I also offer my fullest congratulations to both Members who made their maiden speeches. They were of the most interesting and fascinating kind. Despite what seemed at one time an endless succession of education Acts, we are, all the same, in danger of letting pass huge revolutions in the education system of this country without much notice. I do not mean in this House, because here we do notice them, but in society at large: amazing changes have taken place without very much comment, and rather fast. Let us take, for example, as an analogy the humiliating shambles into which our universities have descended over the past decade. They were a part of our education system which, though certainly not perfect, represented a jewel in the crown.
I am afraid that, if we are not careful, another huge revolution will have taken place and we shall notice it only afterwards—the demise of the local authorities. It would be a revolution of an extremely sad and destructive kind. I hope that there may he time for us to
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bring all our influence to bear to prevent that happening. It is certainly not happening quite so soon as perhaps the Government at one time wanted; that is to say. the rush on the part of schools to become grant-maintained has not gone through all the schools. But I fear, as do others, that sooner or later all schools may become grant-maintained, whether as the result of parental choice or not. All funding will therefore be controlled centrally, and the LEA will be left to wither away.
Yet in all services—perhaps excluding transport—"localness" should be absolutely intrinsic to the provision of education in schools. A proper service can be provided only if the providing authority knows its schools, knows its teachers and knows its parents and children.
Nowhere is that more obvious than in the case of children with special educational needs. As noble Lords will know, at the moment local authorities are responsible for the provision of education and extra educational support for those with special educational needs. It is often the basis on which people say that the local authorities are doing a splendid job.
Such children come into the hands of the local authority only after all identification of their needs has passed through three out of the five stages recommended in the 1994 code of practice that followed the 1993 Act. Until that stage, by which it will have been clear for a considerable time that a particular child is in trouble, the local education authority need not be involved. LEA experts may be consulted at the stage before, but whoever is consulted does not have to come from the local authority.
Some children with special needs will be identified easily and uncontroversially—for example, the profoundly deaf, the blind, those with manifest severe physical disabilities or those with profound learning difficulties. Such children will be known already outside the context of school. But there is a vastly greater number of children whose difficulties become clear only at school, and who may gradually fall further and further behind the rest of their class. The cause of their problems may not be apparent and they may have no particular medical or social problems to be dealt with. I refer to those who have specific learning difficulties, perhaps connected with spelling or reading—dyslexic children in fact—or those through whose behaviour psychiatric problems become gradually more apparent in the school context.
These are children of whom the LEA will have no knowledge whatsoever until matters have come to a crisis. No LEA adviser may have seen the child until this stage, and the parents will have no familiar access to the LEA. There is a void of ignorance, in fact, where there used to be a genuine continuity of responsibility.
Nobody, certainly not I, claims that LEAs will cure everything. All I argue is that nothing can be cured without them. As we all know, some are good and some are bad. Nevertheless, their role is absolutely essential in dealing with the increasing problem of this large number of children for whom, without early intervention and early knowledge of their increasing predicament, there cannot be intervention and the provision of extra help.

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When the 1993 Act passed through Parliament, we heard a great deal about the advantages for schools of becoming independent, free from the "shackles" of local authority rule. But the up-shot has been—and this is my main point—a fragmentation of the system. Schools are isolated one from another, and from any local source of help and advice. The advisory role of the LEAs was of enormous importance and was often very much appreciated by schools.
Those who will suffer particularly from this fragmentation will be those who are most vulnerable and whom the schools themselves, in their isolation, are most likely to fail. They will fail them either by overlooking their existence altogether or even, I fear, by deciding that they are not the children on whom money ought to be spent. Those are the children whose education from three to 19 is most likely to be harmed by the combination of central funding and fragmented independence which seems at the moment to be the goal of government.
4.58 p.m.
Baroness Lockwood: My Lords, I want to examine some of the problems to be faced in providing high quality education and the role of local education authorities in that provision. I am sure we all agree that in providing high quality education many factors have to be taken into account, including the academic abilities of children and the disabilities of some children; the different rate of development of children; their social and environmental background and the expectation that parents and teachers have of them. As the noble Baroness, Lady Perry, indicated, low expectations encourage low achievements. Account must be taken of the role of teachers, and in particular that of the head teacher, whose leadership is crucial; the availability of adequate school buildings; and the different needs of different schools, whatever school system operates in a locality. LEAs have a responsibility to ensure that all these factors, and many more, are taken into account in the school system in their area.
Like schools, as the noble Baroness, Lady Fisher, indicated, LEAs face different problems. Those problems are sometimes historical, sometimes cultural and sometimes managerial. For example, historically, West Yorkshire has a low participation rate in higher and further education. That is no doubt connected with the language problem, in the sense that dialect and poor language construction have impeded the correct use and understanding of English, which in turn can affect learning generally.
In the Bradford metropolitan district, which I want to use as an illustration, the problem is compounded by the high number of children for whom English is not their first language. Moreover, I understand that Bradford is the only local authority in the country with a rising population. It is predicted that there will be a rise of 9 per cent. in the number of schoolchildren over the next 15 years and because there is a disproportionate number of women of child-bearing age among the ethnic community, where there is a tendency to have larger
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families, there will be a shift in the proportion of white pupils to ethnic pupils from 70 per cent. to 60 per cent. That is a rise of from 30 per cent. to 40 per cent. of pupils from the ethnic groups.
That trend will increase the demand for extra language tuition and will have implications for the level of capital required for the schoolbuilding programme. Bradford already has a problem with school buildings, as over one-third of its schools were built before the end of the First World War and over 40 per cent. of the inner city primary schools are Victorian schools in every sense of that word.
That combination of problems requires a strategic approach from the local education authority itself, irrespective of the type of schools operating. Other LEAs will have different problems requiring different strategies, although there are some common problems among urban and inner city areas, as we heard this afternoon.
Bradford's strategy is based on high concentration on language development and achievement, bearing in mind that language competence affects the ability to learn across the whole curriculum. That strategy involves leadership and support to schools in promoting effective teaching based on relevant research and good practice; in-service training and development work; expansion of nursery education and early intervention in language learning; taking advantage of the reading recovery programme and the GEST projects; promoting better language competence generally, through community-based programmes and the training and use of adult support staff throughout the whole range of initiatives; and working with the local TEC, City Challenge and other community-based organisations to improve levels of training and competence.
Such a policy has resource implications, which, I suggest, are not adequately built into the national resource criteria. But Bradford's major resource problem lies in the capital grants area, where priority needs alone amount to over £200 million. If the replacement of temporary classrooms is included, which it is not at the moment, an extra £40 million has to be added, making a total of £240 million in all. That is not surprising when one notes that some inner city schools need as much as £2 million spending on the individual school and that 70 schools have outstanding bills of between £50,000 and £100,000. Yet Bradford is the 36th in the annual capital grants league, with a grant of barely over £4 million. The top grant in the league is £23.25 million; the 117th grant in the league is £41,000; and the last two of the 119 authorities have a nil grant.
I offer no comment on the comparative merits of those awards in the 119 authorities. But, knowing the dire needs of the Bradford local education authority, it seems that the funding of school buildings, let alone the ongoing costs of the education content within the schools, has reached crisis level. If we are to achieve the objectives of this debate, an urgent review followed by urgent action on the funding of education is called for.
5.5 p.m.
Baroness Brigstocke: My Lords, I too am grateful to the noble Lord, Lord Morris of Castle Morris, for initiating this important debate. There is no doubt that on all sides of the House there is the unanimous desire to improve the quality of education for all our children from the earliest years to at least the age of 19. Our ideas may differ as to how best that can be achieved.
Let us he thankful for the good things that there are in our education system at the present day. This afternoon we have already been given several examples and some very fine ones. Let us determine to bring all our schools up to the highest standard.
Although I was a school principal, or should I say a head teacher, for 25 years, I shall not speak about that experience, for it was in the academically selective independent sector. Today, I am concerned with state education and some examples of good practice. In this context I speak as a founding trustee for the City Technology Colleges Trust and as chairman since 1992 of the Landau Forte College in Derby, a school built on what is still a bit of an industrial wasteland. But who cares? The building is purpose built and good, well kept and clean, although the games facilities are restricted through lack of space.
Landau Forte, which is now in its fourth year of operation, has 750 pupils. We estimate that it will eventually have an enrolment of more than 1,000 students aged 11 to 18. The two founding sponsors, Martin Landau and Forte plc, have invested millions in the school and it is now attracting investment from the business community around and in Derby. One could say that it is enlightened self-interest, for Derby companies will benefit from the well trained and well educated workforce which Landau Forte is already providing. For example, one of our BTEC students (I remind noble Lords that BTEC stands for the Business and Technology Education Council qualification, which is taken either instead of or side by side with A-levels) in the two-year post-16 course was one of only 17 to be accepted on the Marks & Spencer management training course out of a field of 2,000—and that was straight from school.
That school, which is beginning to do well, is not academically selective. However, because of the large numbers of applicants, there needs to be some form of selection procedure. Selection is on two criteria: first, a simple test of technological aptitude—some sense of space, of manual dexterity; secondly, the commitment of the parents, who are: expected to support their child in full-time education until the age of 18—the emphasis is on co-operation and mutual support. The intake is representative of the whole population of Derby and, through the curriculum and most of all through the ethos of the school, all the sixth-form leavers are going on to further education or training. Their courses include medicine, physics, biochemistry, building, surveying, accountancy and aero-engineering. We have our share of children who are in need of extra help: 18 per cent. of students are of different ethnic origin—8.3 per cent. Indian, 4.4 per cent. Pakistani and the rest include
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Afro-Caribbean and Chinese. As for pupil support, 14.83 per cent. of the school qualified for free school meals and 20.33 per cent. for uniform allowance.
The special needs situation is unsatisfactory because there is such a delay in obtaining statements for those who need them. We have 45 students at one or other of the five stages which could lead to statementing. Our budget from the DFEE is based on the average school budget of all those local authorities in which the CTCs are situated. The difference is that the annual unit allowance for each CTC student is uplifted by £165—£50 to cover special inner city status; £100 to cover "CTCness"; and the other £15 is to pay VAT.
What is "CTCness"? I speak of Landau Forte because it is the college that I have come to know best. Altogether, across the country, there are now 15 of the original CTCs, 127 technology colleges, 16 language colleges and 115 affiliated schools; the number is mounting. Through that network of schools the CTC Trust is working not only to raise standards in technology, maths, science and modern languages in the case of specialist schools, but also to ensure that there is an effective partnership with industry to secure the appropriate skills for the future needs of this country.
The schools in the network are linked by the Internet and there is an exciting project with headteachers on "headnet"; a pilot for head teachers in developing their expertise using the Internet and electronic mail. Other projects of the trust which may be helpful to all schools include publications such as Adding Value and Improving Performance, Working with Parents and English for Technology. Those all address areas of concern in schools today.
Two colleges in particular have had outstanding success this year. Harris City Technology College in South London raised its pass rate per pupil to 4.25 per cent. for those taking GCSEs, with 43 per cent. of pupils gaining five or more at grades A to C. The Thomas Telford School had such a successful Ofsted result that it appears as though the figures on achievement, quality of learning and quality of teaching, are among the highest ever recorded by Ofsted.
I wish to make two final points. The first concerns statementing and the local authority whose responsibilities are highlighted today. Our Derbyshire authority has a statutory authority to deal with special needs provision. We would like to be able to call in the education psychology service to help with our assessment of pupils with special needs at the first required stages. But Derbyshire refuses to sell us its services.
Finally, the first thing we notice when entering Landau Forte is a board. On it is written,
"Emphasis will be given to equipping students with the qualifications, personal skills and attitudes required for successful adult life and creating an environment in which all people are valued and respected".
I believe that is better than giving specific commandments. We have already heard of the overburdening of teachers. I should like to finish with a quotation from Montesquieu:

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"We receive three educations, one from our parents, one from our teachers and one from the world. The third contradicts all that the first two teach us".
5.15 p.m.
The Earl of Longford: My Lords, it is a special pleasure to follow the noble Baroness. My wife and I had seven grandchildren educated by her. We are very proud of them and grateful to her for the way in which she brought them up.
I shall use my few minutes to discuss a question which has cropped up occasionally, although it has not been the main topic today. We are told in the newspapers, if we read them—one can hardly have missed this over the past few days—that what schools must now do is teach children the difference between right and wrong. I want to dwell on that question for a few moments.
I speak with diffidence in the presence of a distinguished modern philosopher like the noble Baroness, Lady Warnock. She must be the only distinguished philosopher who is married to another distinguished philosopher, very much lamented. I therefore speak with diffidence in her presence. However, I do not think that she would suggest that moral philosophy is something that schools should have to teach our children.
A philosopher who frightened generations of graduates in my time as an undergraduate and Don was Professor Joseph. He used to put the question, "What do you mean by that?" That foxed everybody until a student called Lindermann came along—later Viscount Charwell—and pulled him up by asking "What do you mean by 'mean'"? That stopped the professor in his tracks.
That was one philosopher. Then of course there was the philosopher criticised by the noble Baroness, Lady Warnock, and her husband, the late Professor Ayer, who taught us that moral sense was just an emotive affair and therefore there was no right or wrong in anything. That was very palatable to many young undergraduates and had a disastrous effect.
Then, of course, the noble Lord, Lord Donaldson, was asked to write an introduction—a great compliment to an undergraduate—to Five Types of Ethical Theory by Professor Broad. I do not believe the noble Lord, Lord Donaldson, would tell us that that is the way to teach students.
So what must we teach them? How do we teach them the difference between right and wrong? First, we must decide the code that we want to teach them. If they are talking about right and wrong in the abstract, we have to tell them that some things are right and some things are wrong. I suppose we could make a start with the Ten Commandments, which would carry us a certain distance but not all the way. However, there are aspects of the Ten Commandments on which I am sure the right reverend Prelates and some of our other religious leaders will wish to dwell. One of the Ten Commandments is to forbid adultery. Do we hear much about that?
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One may say that to teach small children about adultery is hardly relevant. Nevertheless, I venture to repeat what I have said in this House many times before. Fornication—that is, sex before marriage—leads to adultery afterwards; adultery afterwards leads to broken homes, which in turn leads to crime. Many of the troubles of the age go back to that fact. Living in sin, as the Archbishop of Canterbury recently described it—living together before marriage—is quite fashionable. Surely therefore if we are to teach young people anything of what is right and wrong, we must teach them sexual morals.
There is a difficulty in that regard because so many people we love and admire have been guilty of breaking the sexual rules. People we would never dream of associating with dishonesty, cruelty or any of what are ordinarily considered to be human weaknesses, have fallen down in that respect. It is therefore always harder for people, especially those who may themselves not be impeccable in that respect, to preach that message. Nevertheless, if we are to talk about teaching people right and wrong, we must include sexual morals and I make no bones about saying that.
My main point is that if we are to teach people ethics, in a country which is overwhelmingly Christian—all this nonsense about multi-faith makes me, as Goering would say, reach for my gun, if I had one—the ethics taught should be Christian ethics. If anyone can find me a book on ethics which is not Christian, I should he glad to be told afterwards.
If we start with Christian ethics, that means the Gospels. If one specific sentence is to be taken from the Gospels and one sentence only, it should be,
"Thou shalt love thy neighbour as thyself'.
That comes from Leviticus in the Old Testament. Christ carried it very much further and told us that it includes everybody, not just a specific race or community. I need hardly say that it includes humanists, of whom there are quite a few distinguished Members in this House. It includes criminals, whom people sometimes find rather hard to love. Nevertheless,
"Thou shalt love thy neighbour as thyself"
includes everyone. So, if I am asked where we should start with children, where we should start to teach them morals, I say that we should get them to read the Gospels. They will never regret it and nor will the country.
5.19 p.m.
Lord Dixon-Smith: My Lords, some 10 or 12 years ago I recall being invited to address a local management school on the management problems of large organisations. I spent my allotted time discussing management in human terms, particularly how different groups of people led by different individuals might follow almost diametrically opposed paths and both would produce very successful results. I did not know, because I had not been told, that the school taught management as a precise science. I might add that I was not asked again. I feel perhaps slightly in that position today.

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I have long experience of management in education in one sense. I was a member of a local education authority—it was a county council and not an education committee—for nearly 30 years. I go back to two notorious circulars—1065 and 1066—which we would all do well to remember. I go back that far because the noble Lord, Lord Wallace of Saltaire, in an excellent maiden speech, talked about an investment in education for 40 years and for generations to come. He is right. I remember saying, a few years after those notorious circulars, when we were working together in Essex on the revolution that the circulars induced or, if one likes, compelled, that if we were wrong we would bear a dreadful burden for which future generations would not thank us. We heard the noble Lord, Lord Quirk, indicate how pervasive some of the perverse ideas of those times still are. They are still very strongly within our education system.
One of the great problems which I was never able to solve concerns the diversity of performance of similar institutions. If we had ever been able to raise the performance of schools which were similar from the level of the average to the level of the good, or, better still, from the level of the poor performer to the level of the good performer, many of our educational problems would have disappeared. In that sense I think we must welcome the great initiative to give head teachers proper training.
There is little doubt that success in an educational institution depends crucially on the skill, initiative and drive—it is drive—of the man who heads the institution. One can only observe this as a result of empirical observation, but empirical observation from going round many establishments gives a clear indication of what I have said. One will find successful, highly motivated schools with successful, highly motivated children, with parents participating and keen for success, only where there is a head teacher who is capable of inspiring all those diverse groups and interests to come together for a common good. If we can achieve a greater level of success—in saying that I am making no criticism of existing head teachers because many of them face very difficult problems and there is a great diversity across all their schools—we can begin to achieve much higher standards in education.
Quality in education is not a question of money. It never has been. With all the thrust that there has been from what I would call the "Oliver syndrome"—the temptation to demand more—we have always had the paradox of success mixed with relative lack of success. If only we could do more in that field, we could do better.
There is another indicator at the present time on the financial front which perhaps I should not mention, but I shall. Nowadays, under local management schemes, schools manage their own budgets and keep their own funds. They carry forward any balances from one financial year to the next. I do not know the situation in every local education authority. I can quote only the one I know best. But with all the talk that we hear of squeezes on expenditure and cuts, the fact remains that in the previous financial year the balances held by Essex schools increased by more than £1 million. They
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increased from £25 million to £26 million. That is a considerable chunk of the public's money which was raised to pay for education but is sitting in banks on deposit because of the perhaps prudent—or perhaps not prudent—decisions of school governing bodies. They are entitled to take those decisions and they are entitled to save for a rainy day. But one has to ask whether having a large sum of money gradually building up is necessarily correct.
There is nothing else I wish to add except that these points apply equally in the primary sector. It is in that sector that the foundations of education are laid. It at any time there are more resources—I note the discrepancy between the suggestion of the noble Lord, Lord Morris of Castle Morris, of cuts, which implies underresourcing, and the rather different attitude one would hear if one were speaking to the Leader of the Opposition in another place, or indeed the Shadow Chancellor, where they are quite clear that they do not wish to increase the expenditure—it is quite clear in my mind that they should go into the primary sector.
5.28 p.m.
Lord Dubs: My Lords, I thank my noble friend Lord Morris of Castle Morris for giving us the opportunity to debate education. We would all agree that teaching is a tough and demanding job. I sometimes feel that we expect too much of our teachers. What they need above all at the present time is stability and no more drastic changes in the way they do their work.
No area is more demanding than that of special needs. I should like to say a little about special needs teaching. When children fall behind, when they cannot keep up, particularly with literacy, it poses an enormous problem and cost to schools. Later in life, alas, a minority of children who have not achieved normal standards of literacy tend to become involved in anti-social behaviour and some of them even in crime. I do not believe there are any easy answers to this problem but we have some evidence that there are ways forward. One approach has apparently worked., and I say that based on evidence. I refer to the reading recovery programme which was developed in New Zealand and has been used since 1983. It has also been put into practice in Australia, Canada and the United States.
In 1992 the Government made some funds available through the grant for education support and training under the theme Raising Standards in Inner City Schools. There was a national pilot scheme and 20 LEAs bid successfully for £40 million spread over a three-year period. In September 1993 a team of national co-ordinators was appointed to monitor and support national implementation. Unfortunately, at the end of the three-year pilot scheme, the Government declined to make further funds available, arguing that it was up to the LEAs.
What is reading recovery, which I believe has the potential to make a significant difference? It is not essentially a classroom literacy programme; it is an early intervention programme which targets six year-olds, before statementing in most cases, who after a year at school have made a slow start and are at risk of falling

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further behind, especially in literacy. The concept is that a specially trained teacher gives intensive daily tutorials to enable the children to catch up after, say, six months and not to need further support. That is the success of the programme. The cost to an average primary school is about half a teacher's salary.
The question is this: does it work and does it work well enough? There is evidence from the United States and Australia. In this country, given the pilot scheme, an evaluation commissioned by the Schools Curriculum and Assessment Authority showed that the programme was more successful than alternative approaches and also better than the usual form of remedial help offered by schools. Although the programme was expensive—and I certainly concede that—its greater effectiveness indicated that it was in effect cost-effective. Providing ordinary in-school support over a four-year period would have cost the same but with less tangible improvement in the literacy attainment of the children.
What is the position in the United Kingdom today? Twenty-six LEAs in England, two in Wales and two in Northern Ireland have now set up reading recovery centres where tutors train teachers to develop the programme. It is estimated that about 5,000 six year-olds benefited last year. By July last year we had 900 teachers working in that area, but today that figure has fallen to 750 because of the lack of funds.
I believe that early intervention requires special funding. I should like to quote from what the HMI said in its evaluation of Raising Standards in Inner City Schools projects, which included reading recovery. It said,
"What has worked has been early intervention … a programme of professional development for teachers which provides specific skills and knowledge to address, for example, pupils' poor standards of reading … and the effective use of data to establish base-line indicators and measure pupil progress … detailed pupil assessment and carefully targeted programmes of remediation … embedding elements of projects in the school's policies and practice".
The HMI went on to say,
"LEAs with reading recovery were able from the start to collect detailed information about the day-to-day progress of pupils".
Therefore, we have something which I believe has been proved to be effective. I believe that the Government's argument will be based on cost. I concede that £10,000 for half a teacher in every primary school comes to a large sum of money. The scheme would cost £75 million if it were introduced immediately. But we can offset that against, first, the savings in long-term remedial support and, secondly, the more substantial, but difficult to quantify, savings which result from eliminating the difficulties of a lifetime of illiteracy and under-achievement for any individual.
The Government have made some more money available. They have recently announced plans to set up a national network of 10 primary literacy centres. I am not quite clear what these are intended to do, but I wish that the money for those centres had been used for the reading recovery programme. We have a situation where in Nottingham and Wolverhampton projects that were set up with government support have had to be abandoned. Authorities in places like Doncaster,
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Rotherham, Islington and Wandsworth cannot afford to allow tutors to train any more teachers this year. So the schemes are coming to a halt.
There are other benefits in the reading recovery programme. Although it is not intended to be a classroom literacy programme, as I have said, nevertheless teachers trained in its use acquire wider skills which they can use in the classroom because they will have a more thorough understanding of the reading process; they will have an ability to monitor children's progress effectively and help them build on their existing knowledge; and they will acquire skills which will enable them to match the level of texts in schools with the needs of the children who are learning literacy. So these skills will benefit many children in the primary classroom and not just those who have been selected for early intervention.
Before I conclude, perhaps I may say that, as an adjunct to this, it is important to mobilise parents. The majority of them are anxious to support their children and, if they are given help by the schools in pointing in the right direction, they can make a very rewarding and helpful contribution to children's education, not least in the area of children who are lacking in the right attainment in literacy. As I have said, many schools are doing that already. However, there is the difficulty that a very small minority of parents are not all that committed and there is a need to motivate them.
I believe that the reading recovery programme—I repeat that I do not believe that there are easy fixes in this area—has shown evidence that it can be a useful way of tackling an enormous difficulty. Without it, I fear that many more children will fall behind, at great cost to the rest of the educational system and subsequently to the country.
5.35 p.m.
Baroness Faithfull: My Lords, I thank the noble Lord, Lord Morris of Castle Morris, and welcome our two maiden speakers. I speak on the relationship between the education service and juvenile and youth crime. The Home Office alone cannot deal with the prevention of juvenile crime. I believe that the education service needs to be supported and there needs to be co-operation with parents, the social services and with the community at large. The Secretary of State has responsibility for education and employment and that I welcome. I believe that education could contribute very much more than it does at the moment to the prevention of juvenile and youth crime, but it needs help and co-operation.
Some months ago I visited an area of serious unemployment, particularly among the men and boys. I visited a school and found that there was a high rate of absenteeism among the boys two years prior to leaving school. I then saw a club leader in the area who said that the boys in particular believed that when they left school there would be no work, so they saw no reason to go to school. I talked to many of these boys who were totally unskilled. Would it not be possible, during the last two years of schooling, for each boy or girl to receive training in a skill in which they are interested?

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They may wish to train as a mechanic, carpenter or builder, or in cookery, and so forth. Perhaps attending a place of work for one day a week during the last years at school would help them to realise how important it is to have a skill and to be educated. Furthermore—and I find this difficult to say—it might even help if they were paid a minimal amount for the one day.
I submit that there are jobs available if a young person has a skill to offer. I am told that there is a shortage of mechanics in certain areas of the country. I am also told that the building trade is in need of skilled bricklayers, decorators and so forth. I know of three Australian boys who arrived in this country and within a week they each had a job: as a baker, as a driver of a delivery van and as a motor mechanic. I believe that if our children were given work training during the last two years of school and were given the hope of getting a job when they left school, we would greatly reduce the rate of juvenile crime.
I come now to the concerns about the relationship between juvenile crime and education as regards the younger child. Has the Department for Education sought the experience, for instance, of the Dartington research unit on exclusions from school and absenteeism, which have reached alarming figures? Has guidance been given to the education officers and head teachers as to how these matters can be dealt with?
Perhaps I may cite an example of a juvenile crime. I visited a boy of 12 in a local authority secure unit. I played Monopoly with him and he won. I am not very good at Monopoly; he was a lot better. That child, aged 12, had done 45 "jobs". I asked him how he had got caught on the 46th. He said, "I made a mistake. I cut myself on the window and the blood on my sleeve was the same as the blood on the window, so they caught me". I asked, "What did you do on those 45 jobs?" He then obviously regarded me as a fellow delinquent—he might be right—and said, "Miss, let me warn you: always steal small things. Silver is the best". I asked when he did that and he said, "Miss, you must get yourself excluded from school". I said, "What have you been doing for the past two years?" He said, "I have made a lot of money. Would you like me to tell you where to sell the silver?". Well, I found out. He then said, "Would you like to know what I do with the money?" I said, "Yes" and he said, "I buy Ecstasy". I did not ask him where he got the Ecstasy because I would have been honour-bound to tell the police and I felt that that might break his confidence in me.
I then asked him, "How is it that you are so well educated?" He said, "Miss, don't you know your Education Act? Don't you know that you must go to school and that you have to have education for five hours a week? I go to a church hall on Mondays where I have a teacher to myself for three hours in English, history and geography and then I go to a church hall on Thursdays and have a teacher to myself in maths". He added, "Miss, I am far better educated than the children at school".
I have great sympathy with teachers who have to deal with disruptive children who disrupt a whole class. I contend that those children need for a time—but not
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for long—to he educated, helped and encouraged quite separately from the school. When I was with Barnardos I remember a local authority and Barnardos co-operating to set up a house for 35 children with special teachers. It opened at weekends as well as during the week. I shall not go into the technique that it used—there is not the time—but within a year all those children returned to their normal schools. There was no longer any absenteeism from them and they had ceased to he disruptive in the classroom.
I ask my noble friend the Minister whether the Department for Education and Employment has sought any research into how such children will be dealt with. Have the success stories in dealing with such children been looked at? Until we really look at the problem and find a way out of it—we shall only find it by really good research—I contend that our juvenile crime figures will not drop.
5.43 p.m.
Lord Haskel: My Lords, in this debate my noble friend Lord Morris rightly wishes to draw our attention to the need for all children to have high quality education, including children with special needs. I too would like to speak about those particular children and I am most grateful to my noble friend Lord Morris for providing this opportunity.
Since the report of the noble Baroness, Lady Warnock, it has been acknowledged that special needs children are best taught by integrating them into mainstream schools. That gives them a greater breadth of curriculum and intellectual stimulation and enables each child to reach his or her full potential.
However, that laudable aim is hindered by the Government in two ways. First, the Government give the problem to the local authorities without giving them the money to solve it. I refer secondly to the present operation of the school league tables. The Government's policies of encouraging schools to become grant-maintained and the proposed increase in a school's ability to select pupils are aimed at further undermining local authorities.
My noble friend Lord Morris, the noble Baroness, Lady Warnock, and my noble friend Lord Dubs told us how special needs children are dealt with. They reminded us that by law the burden falls squarely on the local authority, which is responsible for categorising the degree of special educational need of those children and for providing the appropriate learning support. As we have been told, that procedure is called "statementing". The process is rigorous and expensive and it is tempting to procrastinate and delay, because once a child is statemented, a further set of costs are incurred, straining yet further the inadequate funding which the local authorities receive for that purpose. Perhaps that explains the experience of the noble Baroness, Lady Brigstocke. As a result, those vulnerable children and young people suffer and become the disaffected young people about whom my noble friend Lady David spoke.
There are rumours that the system of funding is to be changed. Can the Minister tell us whether there are any changes which will relieve the burden on local

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authorities with large numbers of special needs children? In his response I hope that the Minister will not refer to the £878 million of extra spending for schools that was announced in the Budget. I am sure that he will be aware that on Monday the all-party Select Committee on the Treasury and Civil Service, on which the Government have a majority, stated:
"some schools may neither perceive or receive any increase in resources".
The committee said that there was "little doubt" that some local authorities would be unable to pass on the funds because their own reserves had been eroded by £850 million in 1994–95 and by £930 million in 1995–96.
"This increase in spending does not … have quite the substance the Chancellor claimed for it",
the committee said.
The second barrier to statemented children receiving high quality education is the present operation of the league tables. The noble Baroness, Lady Young, praised those tables but did not tell us that no account is taken of the value added by successfully integrating and educating a special needs child. Therefore, there is every incentive not to have special needs children in a school. The number of special needs children in a school does appear on the league table and from this we learn that grant-maintained secondary schools take far fewer special needs children than local education authority schools. The London Research Centre noted in October 1995 that local education authority secondary schools had 2 per cent. of statemented children, compared with 1.1 per cent. in grant-maintained schools.
In November 1995 we were told that there was a review planned for the league tables to include those added values. Can the Minister say whether the review will include the value added by integrating and educating special needs children, and how that will be done? At present the league table gives value only for exams passed. Some special needs children will never take exams. How do the Government intend to value the progress and effort made by those children?
The local authorities do address the needs of special needs children, and so the present system is rigorous and educationally sound. The individual educational plans could enable maximum development for the child, but that is undermined by the present system of funding, the league tables and the Government's wish to reduce the influence of local authorities over schools through their policies of opting out and selection. If the present systems were allowed to operate as intended, we could ensure that the local authority could deliver the high quality education to all children called for by my noble friend Lord Morris.
5.50 p.m.
Lord Tope: My Lords, we are grateful to the noble Lord, Lord Morris of Castle Morris, for initiating the debate. Even by your Lordships' standards, it has been an exceptionally well informed, thoughtful and thought-provoking debate which I have enjoyed very much. It was characterised by two outstanding maiden
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speeches. They were outstanding in both content and delivery. It came as something of a relief to find that I agreed with everything said by my new noble friend Lord Wallace of Saltaire, in particular about education on the cheap and its impossibility. It came as not too much of a surprise to find that I agreed with virtually everything said by the noble Baroness, Lady Hayman, although I think she went a little over the top in her reference to the extreme youth of the Government Front Bench.
At this stage I should, as I always do, declare an interest. I am still the leader of a London borough council, which is a local education authority, and the governor of an LEA-maintained school in the ward that I represent on that council. For good measure, my wife is a teacher. In spite of all those handicaps, I was pleased with the way in which we have debated the role of the LEAs. I was pleased that there was specific mention of them in the Motion before us and I was even more pleased by the generally constructive references that have been made to them today. The noble Lord, Lord Skidelsky, was right to say that there are good and bad LEAs. The good ones vastly outnumber the bad, although inevitably one tends to hear more about the minority of bad ones than the great majority of good ones. I am pleased that that has not been the case today.
It is also true to say that the role of LEAs has changed enormously, certainly in the 10 years that I have been leading the council. When my party first came into control of the London borough of Sutton the previous Conservative Administration—it is not only Labour administrations that are bad—insisted on appointing a majority of school governors, insisted on having its own appointees as chairmen of governing bodies and all but one of the vice-chairmen had to be Conservative appointees. That has changed, as it had to, not least by Government legislation. It was something that we were keen to change. The interventionist days of the old-style LEA are gone for good, which is a thoroughly good thing.
Today local education authorities work very much in partnership with locally managed schools. They do not control them, they do not seek to control them and they do not wish to control them. They work in partnership with the schools, the staff, the parents, the local community and the pupils. There is a positive involvement of parents and the local community in their schools. I believe that that is the principal reason why the grant-maintained initiative has been such a failure.
When Conservative politicians speak of throwing off the shackles of the local education authority it is language that the local community does not recognise. It is not the reality that they know. That involvement led to protests such as we had last year, and may well have this year, about the funding cuts. Because of the involvement of parents and the local community in the running of their schools they knew where the blame lay. The suggestion that it lay principally with local education authorities did not wash with them. Funding is very much on the minds of all local education authorities at this time and of schools and parents too. Reference has already been made to the impression that the Government wish to create, and which some Tory

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MPs are gullible enough to believe, that the current settlement has brought no real additional resources to most LEAs. The noble Lord, Lord Haskel, used exactly the quote that I was going to use from the Treasury Select Committee. That body has a Conservative majority and it made it quite clear, as did the Education Select Committee which reported before the Budget, that the picture is nowhere near as rosy as the Government would wish us to believe. I have spoken many times about the Government's underfunding and under-recognition of education. But as this Government daily demonstrate that they are nearing the end of their life, they become less relevant to the future. I wish today to turn to the issues of the future.
In an excellent opening speech with which I agree in large part, the noble Lord, Lord Morris, referred to the Government needing to tackle the undermining and underfunding of local education authorities. How right that is. None of us expects the present Government in their dying days to do that. Indeed, it would scarcely be credible for them to do so.
I listened to hear what new Labour is proposing. Presumably it has aspirations to government in 12 months or so. How is it proposing to tackle these urgent needs? I turn, first, to the point about undermining. I have no doubt about the commitment of new and old Labour to local education authorities. However, the party's proposals to allow grant-maintained schools, which it still denigrates, to remain outside the LEA framework must be undermining to those LEAs. The creation of so-called "foundation schools" is a fudge designed for no better purpose than to avoid upsetting the demonstrably small number of people who still believe that GM schools are a good idea.
GM schools were another of the Prime Minister's big ideas. In spite of all the bribes and the very unlevel playing field, very few schools have chosen to opt-out. That shows that another big idea has failed. Even the announcement of the Labour Party's fudge on foundation schools did not lead to an increase in opting out. In fact, quite the reverse.
The Prime Minister's flagship has sunk but what beats me is why the Labour Party should so want to cling to the wreckage as to compromise its commitment to the LEAs. The Liberal Democrat Party is the only party able to give a clear and unequivocal commitment to strategic, light touch LEAs working in partnership with all the locally managed maintained schools in their areas.
The noble Lord, Lord Morris, also referred to underfunding. Carefully though I have listened to all the speakers from the Labour Benches, there has been a deafening silence about what the Labour Party will do about that underfunding. All of us are committed to improving quality and standards in education, albeit, we have different ideas about how that should be done. None of us believes that more resources is all that is needed, but we recognise that improvements will not he made without more resources. The Liberal Democrats have been honest enough to recognise that, and our commitment to provide increased resources for
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education is well known. That is real, new money and not existing resources recycled from other much needed and underfunded public services.
I do not doubt for one moment the sincerity of many in the Labour Party, particularly some of my colleagues in local government, in their very real commitment to education. But where is the commitment of new Labour actually to fund the improvements it calls for? So far it seems to extend only to the resources which will become available from the phasing out of the assisted places scheme. That, it seems, will pay for everything from nursery places for three year-olds to better teacher training.
Welcome though the phasing out of the assisted places scheme will be in itself, nobody believes that the resources so released will be more than a drop in the ocean compared to what is needed. As a pragmatic politician, I can well understand new Labour's reluctance to give any hostages to fortune too long before a general election. I look forward to a detailed and costed manifesto which I am sure it will produce at the time of the election. Then perhaps we will get the real measure of its commitment to education.
However, it has an opportunity well before then at least to show some commitment to the priority it says it gives to education. If that is a real commitment, at least it can show that it comes higher in the party's priorities than its commitment to tax cuts. New Labour will show its real priorities by how it votes on tax cuts proposed in the Finance Bill currently before the other place, as all but a handful of "old Labour" MPs failed to do on the Budget debate.
I know that the noble Baroness, Lady Farrington of Ribbleton, will not be in a position to commit Labour Members of Parliament in the other place. I do not expect that. However, if new Labour wants the country seriously to believe that it really does give top priority to education, as I know it does, I hope that it will use this important debate to urge its colleagues in the other place to demonstrate that in the vote that will come on the tax cuts. If it does, I know from my own experience, as does the noble Baroness, that it will receive the very full support of its party colleagues throughout the country, colleagues who are struggling to run LEAs with ever-diminishing resources.
As I said before, this debate has been characterised not only by its high quality but also by the deafening silence from those on the Labour Benches as to what they propose to do about the issues which they have rightly raised. Talk of underfunding of education but silence today on proposed tax cuts will speak volumes.
6 p.m.
Baroness Farrington of Ribbleton: My Lords, it is for me a particular pleasure to thank my noble friend Lord Morris of Castle Morris for initiating and introducing this very important debate. It is a debate which I agree has been excellent, even by the standards set normally by your Lordships' House, and it has certainly been enhanced by the contributions of both the noble Lord, Lord Wallace of Saltaire, and my noble friend Lady Hayman. Like my noble friend Lady

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Hayman, I too have spent much of my life in the category of a married woman about to return. My noble friend's speech demonstrated that this is a serious opportunity for people to enhance their knowledge, experience and skills. I look forward to future contributions from both maiden speakers.
As my noble friend Lord Morris said in opening the debate, it is about quality in education. As he stressed, it is about quality for all children in all schools in all places at all times. This is an extremely important issue and the role, powers and duties of LEAs in the contribution which they make towards high quality education provision for all pupils have been referred to on many occasions by noble Lords.
I do not intend to speak for my colleagues in another place on this occasion. I know that the noble Lord, Lord Tope, knows me too well as a colleague in local government to expect me to do so. However, I refer the noble Lord to the fact that we have a commitment to phase in nursery education for all three and four year-olds whose parents wish them to have it. The noble Lord, Lord Skidelsky, referred to that. I should declare an interest because I am still a member of a county council and was chair of education for 10 years. While a few parents do not wish their children to have the advantage of nursery education, the overwhelming majority do wish their children to have the benefit of appropriate nursery education. The Labour Party commitment in that regard is quite clear, as is its commitment to five, six and seven year-olds being taught in classes of not more than 30 pupils.
This debate provides us with a timely opportunity to discuss the future relationship between government and education. It is erroneous to refer constantly to grant-maintained schools as somehow escaping a relationship with government. The relationship changes from that with the LEA to that with central government and with a quango of appointed people.
The Labour Party's commitment is that the organisation of schooling does, and should, recognise that schools are responsible for managing themselves and that accountability must exist to parents and to the community as a whole within that locality. The right reverend Prelate the Bishop of Ripon made a point about the importance of the relationship between the community and the schools serving that community.
The Labour Party is committed also to fair and open funding and admission procedures which must be against the reintroduction or maintenance of 11-plus selection and unfair advantage. I understand and respect the contribution made by the noble Baroness, Lady Brigstocke, through the work of a city technology college. But I do not believe that it is fair to make a comparison between a school where the method of selection for pupils' admission is commitment of parents and a school which cannot choose to refuse to take children where there is a lack of parental support, for whatever reason.
In this debate there have been numerous references to the excellent work of LEAs. The noble Baroness, Lady Young, referred to a variety of issues which have
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been taken up at national level. I wish to make plain that many of those issues and initiatives came from local education authorities in the first place. The national curriculum was pressed for by local education authorities with the support of their Church representatives. The prescriptive nature of the Government's initial introduction has been recognised by them in the changes that they have sought to make. Moreover, local management of schools was initiated originally by LEAs, including Cambridgeshire.
Local education authorities have powers and duties. My noble friends Lord Haskel and Lord Dubs referred to special educational needs, as did my noble friend Lady David and the noble Baroness, Lady Warnock, with her distinguished knowledge in that field. That is one role which LEAs fulfil well. There is even greater difficulty as regards meeting the needs of statemented pupils compared with non-statemented pupils. I believe that 18 per cent. of pupils with special educational needs are non-statemented and are to be found in a preponderance of schools serving disadvantaged communities. That is another argument for not making crude comparisons between the performance of one school and another.
The initiatives taken by local education authorities are to be welcomed. The noble Baroness, Lady Fisher, referred to parental involvement initiatives in Birmingham. There are other initiatives under way. I hope that in his response the Minister will wish well the Hackney authority's parent support service which is in its infancy. It is supported by a generous donation from the Carlton Television Trust. A good feature of that parent support project is that the booklet for parents is written by a group of parents who have been able to communicate with other parents.
The issues which have been raised highlight the need for local education authorities to have resources not only to transfer to school budgets—a very important feature of LEAs—but also for two other vital functions. One is to rectify what must, with the best will in the world, be a crude national formulae method for funding individual schools and LEAs. It is critically important that funds allow problems which arise through the national formulae to be tackled where the local community knows and believes that that needs to be done.
Secondly, there is the important issue of the powers of LEAs. I refer to the speech made by the noble Baroness, Lady Faithfull, in relation to the prevention of juvenile crime. That work may be done by special educational needs staff and also by the youth and community service. Again, that is an area which is vulnerable if LEAs do not have funds for such projects and do not have the power to raise funds.
Throughout the debate about the role of local education authorities runs a very troubling thread. I refer to people who take examples of local government not working in an acceptable way and use them as an argument against the contribution of local democracy. Even central governments may make mistakes. One thinks perhaps of the community charge. But that is not an argument against democratic accountability.

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In line with our policy to seek to identify and disseminate good practice through our Quality For All initiative, the approach of those on this side of the House is to use LEAs as a source of knowledge and build on their experience. The Government now appear to be listening to the voices of those in the community. I hope that the Minister in his reply will listen to the voices of so many in this debate and reassure us that a partnership between central and local government in the provision of good education will be the hallmark of the Government's future response to this subject.
6.10 p.m.
Lord Henley: My Lords, I start by offering my congratulations to the noble Baroness, Lady Farrington, on what I think is the first debate that she has wound up from the Dispatch Box. I very much look forward to hearing her on many subsequent occasions on the subject of education, together with her noble friend Lord Morris of Castle Morris. I also offer my congratulations to the noble Lord, Lord Morris of Castle Morris, on what I believe has been a very interesting debate of the highest quality. Speaking on behalf of myself and the noble Lord, Lord Morris, that may be because we speak as mere men in a debate in which over half the speakers are noble Baronesses. I believe that that has added a great deal to the debate and reflects well on this House.
I also offer my congratulations to both maiden speakers—first, the noble Baroness, Lady Hayman. I am glad she recognises that neither I nor my noble friend Lord Lucas is a grandparent. Like her, we are mere parents, but no doubt in due course we may join that probably larger majority of grandparents in this House. We welcome her back to political life after 17 years in which, as my noble friend Baroness Perry put it, she probably learned a great deal more and served a more useful role than we could ever do. I look forward to hearing the noble Baroness on many occasions.
I also appreciated the opportunity to hear the maiden speech of the noble Lord, Lord Wallace of Saltaire, from the Liberal Benches. I look forward to further contributions in which he will bring to bear his expertise on the subject of higher education. This is not a subject in which we are notably lacking in expertise in this House, as I have learned to my cost and will no doubt learn to my cost on many occasions.
I should like to pick up one point that he made. To some extent I reject and have been saddened by his allegation that I and my ministerial colleagues wish to denigrate teachers. Obviously, there are bad teachers. There always have been bad teachers, and it is quite likely that there always will be. What I and my right honourable friend the Secretary of State have done is to make clear that we believe that the majority of teachers do a very good job. That was something that I tried to make absolutely clear in the summer when, in the absence of my right honourable friend the Secretary of State, I announced the A-level and GCSE results, both of which showed an improvement. The point that I wished to get over then, as now, was that obviously I wished to praise pupils and parents,
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but those to whom I first offered praise were their teachers who were mostly responsible for that particular achievement.
As always in a debate of this kind, a great many subjects have been raised. Noble Lords would not expect me to answer all of the points put this evening, but they can rest assured that where specific questions have been asked of me I will, where appropriate, reply to them. I should like to deal briefly with two or three points before I get onto the substance of my speech. The noble Baroness, Lady David, spoke with some expertise on special needs and a project in Cambridge. The noble Baroness will know that that is one of my responsibilities within the newly merged Department for Education and Employment. It is within the special needs and disabled field generally that we hope to see some added strength as a result of the merger. I would be interested to hear more about the subject that she mentioned. If on this occasion she would care to write to me, I would be more than happy to receive her letter.
We also heard somewhat different views on the question whether A-levels should or should not be scrapped. I believe that my noble friend Lord Skidelsky and the noble Lord, Lord Wallace, carne at this from very different points of view. As many noble Lords will be aware, this is something that Sir Ron Dearing is examining in detail at the moment in Ins whole review of the 16 to 19 qualifications. He produced his interim report last summer, and he is preparing to produce his final report around about Easter. I hope that that will very much inform the further debate that we can all have on that occasion about how to develop the qualifications for 16 to 19 year-olds.
I am grateful to the noble Earl, Lord Longford, for his remarks and the issues that he addressed. Those issues were raised by the chief executive of the School Curriculum and Assessment Authority, Dr. Nicholas Tate, in the SCAA conference that he organised on Monday. That debate will not only be very useful, but I believe that it is absolutely fundamental to our future—to how schools operate and to how we see the development of our children. I am grateful to the noble Earl for that.
My noble friend Baroness Faithfull put forward some very interesting ideas, in particular on the subject of work experience for 14 to 16 year-olds. This is something about which I and my right honourable friend are very concerned. It is a matter that needs to be addressed. My noble friend is right to refer to the fact that some 14 to 16 year-olds need more than the basic work experience that we make available at that age; that something more may be appropriate, particularly for those who have been alienated from the educational system. That is a debate in which we can all usefully engage.
The noble Lord's Motion deals with the need for high quality education. Obviously, I am grateful to the noble Lord for providing the House with the opportunity to debate these matters, but I believe that in general it is not something that needs to be drawn to the attention of the Government. On the contrary, over the past 16 to 17 years our policies and initiatives have done more than anything to put the

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spotlight on quality. That emphasis on quality has been central to our educational policy. Throughout our term of office we have striven to ensure high standards and to promote diversity and enhance choice. I believe that all of those play their part in raising standards. To set clear standards and make sure that they are met is central to all that we do. That was why we first introduced and developed the national curriculum. As I understood it, at the time that was opposed by the Party opposite. It now accepts it.
Baroness David: My Lords, I was on the Front Bench at that time. What we opposed was the prescriptive nature of the national curriculum.
Lord Henley: My Lords, I am grateful to the noble Baroness for correcting me on that particular matter, but I did not notice the sort of support that we should have been getting on the general subject of a national curriculum. I accept that the precise design of the national curriculum was not as it might be at the beginning. That was why we asked Sir Ron Dearing to review it, and that was why we came forward with further changes to the national curriculum late last year. The noble Lord, Lord Dubs, spoke about the need for stability. I should like to make quite clear that there is now a moratorium on any further substantial changes in the national curriculum. That moratorium will last for some five years and, I believe, will allow schools the stability that they feel they require.
As noble Lords opposite will be aware—and, again, as opposed by them—we introduced the regular assessment of children at the ages of seven, 11 and 14 that is now in place. Last year we had a more or less complete operation of those tests. Again, I believe that that was opposed by the party opposite, but I hope that it is now accepted.
Performance tables were published last year. They are now well bedded in and have proved to be extraordinarily popular. Indeed, one only has to look at the amount of coverage that they receive in newspapers to realise just how effective they have been and how popular they are. Again, they were opposed by the party opposite but now, I hope, are accepted. I believe it was a Mr. John Rae, not a noted supporter of this Government, who said that he believed that the performance tables had probably done more than anything—more than any other reform—to improve standards in our schools.
Perhaps I may touch on a few points relating to performance tables. The noble Lord, Lord Haskel, asked about the inclusion of added value and whether a review was under way to look into added value in the performance tables. I can tell the House that it is not a review as such, but we have asked some academics at Newcastle University to conduct research into possible ways in which added value might be included. I would only be happy to go down the line of including added value in the performance tables if I felt that they would still maintain their simplicity; that they would still be user friendly; and that they would still serve their purpose of encouraging schools to improve their standards. Moreover, we have seen yet further
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improvement through the creation of the Office for Standards in Education. I believe that we now have very effective measures for dealing with the failing or poorly performing schools.
I believe that wider diversity and choice—and I am grateful to my noble friend Lady Perry for stressing the importance of wider choice in terms of improving and increasing parental involvement—are surely desirable in their own right. However, I also believe that they have a beneficial effect on quality. Education cannot reach the highest quality unless it caters for special needs and talents.
I turn now to our steps to increase diversity of provision; for example, by encouraging the formation of city technology colleges. I am grateful to my noble friend Lady Brigstocke for bringing to the debate her expertise on the matter. The formation of city technology colleges and the other specialist schools have helped children with certain special talents or aptitudes to get the best education for themselves as individuals.
Enhancing choice also plays its part in raising standards. Where there is choice, there is competition. A monopoly of supply in any service presents a threat to efficiency and to standards. I do not believe that education is exempt from that general rule. There is also the widening of choice, for example, through the expansion of the grant-maintained provision—again, that was opposed by the party opposite; but I dare say that now, with increasing numbers of Members opposite making use of grant-maintained schools, we shall see a change of policy on that front in due course—and through the assisted places scheme. We believe that that helps to stimulate yet higher standards in schools generally.
Similarly, we have not neglected further education and the vocational training for those who leave school at the age of 16. Again, that has been very much strengthened by the merger of the two departments into the Department for Education and Employment. I believe that it brings a new rigour to all the post-16 qualifications and, in particular, it brings a greater comparability and a shared status between the two—that is, the vocational and the academic strands. That is what we seek to achieve.
Perhaps I may briefly say a few words about the role of local authorities. I was saddened by the somewhat negative approach of the noble Lord, Lord Morris, to our attitudes to all local education authorities. Like many other speakers, I have served in my time as a member of an LEA. We accept that LEAs have an important role to play, even in the areas where there are grant-maintained schools. We accept that they have a role in planning the supply of school places, either alone or in areas where there are significant numbers of grant-maintained schools, in conjunction with the Funding Agency for Schools.
We also accept that local authorities help to promote higher standards in those schools that they continue to maintain. We also accept that they provide a number of services for pupils in both LEA schools and grant-maintained schools—such as educational

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psychology, educational welfare services and the home-school transport. Further, they provide education, as has been referred to, for pupils not in schools for one reason or another.
Clearly the role of the LEAs has already changed over time. No doubt it will continue to change with changing circumstances. It would not be useful to speculate on that aspect. However, I can assure the noble Lord—and, indeed, the LEAs—that they do have an important role to play and that we and Ofsted are helping them to play that role effectively. I certainly reject the implied criticism of the noble Lord, Lord Morris.
I turn briefly to the question of funding and the levels of funding. First, I should like to refer back to the point made by the noble Lord, Lord Quirk, in an earlier debate last year. Although I was unable to respond to the debate on that occasion—my noble friend Lady Miller did so—as I remember it, the noble Lord made it quite clear that merely pouring more money into education was not necessarily the solution and that, if there was a solution whereby one merely poured more money into it, the problems that there are or might be in education would have been solved many years ago.
However, I can assure the noble Lord, Lord Morris of Castle Morris, that we have spent a great deal on education and have not under-resourced it, as he would put it, over the past few years. Indeed, we see an extra £878 million going to schools in 1996–97. I reject the allegations from the noble Lord, Lord Tope, that that is not a real increase. That is a 4.5 per cent. increase in funds available from the taxpayer to the LEAs. How the LEAs manage their own budgets in such a way that the increase reaches the schools is obviously a matter for them. But I am sure that some will manage to do so.
We have also seen spending per pupil in the primary and secondary schools increase since 1979 by some 48 per cent. Spending per pupil on equipment rose by 55 per cent.; spending per pupil on repairs and maintenance rose by 15 per cent.; and spending per pupil on support staff rose by about 138 per cent. Therefore, I believe that one can say that the allegations that we have seriously underfunded education over the years are simply not true.
The noble Lord, Lord Morris of Castle Morris, also based many of his arguments on a somewhat odd report from the World Economic Forum, The World Competitiveness Report, that tried to imply that the United Kingdom was way at the bottom of the pile in terms of educational achievement. I have to tell the noble Lord that the method adopted by that report is not exactly the best way to compare the supply of skills across countries. It is based on incomplete and disparate statistics and arrives at some pretty curious results. Perhaps I may give your Lordships an example. I should point out to the noble Lord that the top two countries on availability of skilled people in the 1995 report turned out to be the Republic of Ireland and the Philippines. That almost certainly reflects the poor demand for skilled people in those economies, rather than an inherently better education and training system.
It is also noteworthy that Japan stands in 22nd place, some two places below the United Kingdom. As part of the commitment that we made in the competitiveness
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White Paper, I can say that the skills audit is currently carrying out a more detailed and robust examination of how the skills of the UK workforce compare with those of our colleagues and competitors in France, Germany, the United States and Singapore.
I see that my time is rapidly drawing to an end. However, there are just one or two points that I wish to address briefly. I was somewhat alarmed by the sceptical approach taken by my noble friend Lord Skidelsky on nursery education. That is certainly something that I hope to discuss with him in due course. I trust that my noble friend will take part in the proceedings on the Bill when I have the pleasure to introduce it to your Lordships' House. The noble Baroness, Lady Nicol, attacked the proposal from the other side. That probably means that I am somewhere in the middle and, as a result, I hope that we have got it about right. But those arguments are best left for the Second Reading and Committee stage of the Bill.
The last principal point I wish to address is on the question of voluntary-aided schools, the opt-out and the proposals that the Government put out for consultation. We are accused by the noble Lord, Lord Morris of Castle Morris, of ignoring the advice of bishops. I have heard worse sins in my time but no doubt ignoring the advice of bishops is a pretty major one. I assure the noble Lord that we did not ignore the advice of the bishops. We issued that paper for consultation. The noble Lord knows exactly what consultation is. As the right reverend Prelate made absolutely clear, we then did consult. We consulted the bishops. There was no U-turn. We took account of what they said and acted accordingly.
I have to say in passing that I was somewhat surprised by the comments of one of the bishops. I have to say to the right reverend Prelate that I do not think it was a bishop from the established Church of this country hut another bishop who made it clear that, in his words, grant-maintained schools were contrary to the teachings of Christ. Obviously my knowledge of Biblical matters is not as great as that of some right reverend Prelates but I am certainly not aware of that passage in the Gospels. But if someone can bring it to my attention I should be more than happy.
As I hope I have made clear, high quality education is crucial to both individual and national interests for all of us. But we need to be quite clear on just how high quality education is to be achieved or, more specifically, who is going to achieve it. The answer must he those closest to the point of delivery—the staff and governors of individual schools, colleges and universities. External agencies like funding bodies, local authorities and my department can obviously help, but the key responsibilities must lie with the institutions themselves. We believe in giving institutions power to match those particular responsibilities. That is why increasing institutional autonomy has been such an important part of our education reforms, and that is why we believe that the grant-maintained sector has given so much to so many and now covers something of the order of 20 per cent. of all secondary children.

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I fear that I am beginning to trespass on the time of the noble Lord, Lord Morris of Castle Morris. Let me briefly end. Education policy is attracting more attention, within this House, within Parliament as a whole and within the country at large, than it has done for many years. Whatever the reasons for that, I very much welcome it. We need debate and we have had a jolly good debate this afternoon. We need constructive discussion of how best to meet the needs of children and young people. We need information and evidence on the effectiveness of different approaches. This Government have absolutely no reason to fear such discussion—least of all the focus it brings to the issue of quality in education. Quality has been the touchstone of our policies throughout the last 16 years and it will continue to be so for the next 16 years.
6.33 p.m.
Lord Morris of Castle Morris: My Lords, slightly to my surprise, I thoroughly enjoyed every minute of this debate. I am most grateful to all noble Lords and noble Baronesses who have taken part. I specially enjoyed the distinguished maiden speeches by the noble Lord, Lord Wallace of Saltaire—though from a fellow member of the professoriate I would have expected no less—and from my noble friend Lady Hayman. If she is a retread, who wants a new tyre? I even enjoyed the characteristically clear and courteous speech of the Minister. I did not agree with much of it of course, but it was informative, helpful and thoughtful and I am grateful to him for it. All of us want high quality education for all our children and that is the heart of the matter. I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

Co-operatives
6.34 p.m.
Lord Carter Lord Carter rose to call attention to the benefits of co-operative action in the provision of social policy and in business, and the case for a new co-operatives Act to assist in such provision; and to move for Papers.
The noble Lord said: My Lords, in introducing this debate I should declare an interest as the chairman of the United Kingdom Co-operative Council which is the single representative body for the whole co-operative movement in the UK. It has in its membership representation of consumer co-operatives, insurance, banking, agriculture, housing, credit unions, worker co-operatives and the co-operative development organisations for Scotland, Wales and Northern Ireland. I should also say that I have been a secretary and director of a major agricultural co-operative for nearly 30 years. There are many speakers in this debate who have had great experience of co-operation in all its forms. I know that we are all looking forward very much to the maiden speech of my noble friend Lord Sewel.
The purpose of this debate is to draw attention to the relevance of the co-operative model in both social and economic organisation and the need for a new
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Co-operatives Act to secure a modern and effective legal framework for co-operation. I am sure that different speakers will describe a wide range of co-operative activity. In opening the debate I shall try to set out a general overview, to give some examples and to conclude with the case for a new Co-operatives Act.
The topic of co-operation is particularly relevant to the current discussion of, to coin a phrase, the "stakeholder society". The debate will, I am sure, demonstrate that the co-operative model is an excellent example of stakeholding in practice. On the subject of stakeholding I was a little surprised to note that Mr. Michael Heseltine recently included co-operatives in his faintly ridiculous fulminations against "corporatism". I could not help wondering whether this was the same Mr. Heseltine who, as President of the Board of Trade, sanctioned a substantial grant to the UK Co-operative Council to produce a resource pack showing how to set up and run a co-operative. The resource packs are now in every DTI and Business Link office and have received a wide circulation beyond the Business Links. To be charitable one must assume that Mr. Heseltine was suffering from pre-election amnesia.
This is neither the time nor the place for a detailed history of the co-operative movement in all its forms. However, it is worth pointing out that the co-operative model is older than either the capitalist or the public ownership models. The earliest traces of a modern type of co-operation occur in Britain in the 1700s. There were 500 co-operative associations already in existence when 28 Rochdale weavers formed the Rochdale Society of Equitable Pioneers in 1844, which eventually became the major consumer co-operative grouping that we know today. Of course we also know that co-operation was not purely a British phenomenon. There were many examples of co-operatives in Europe and in America in the 18th and 19th centuries.
To bring matters right up to date, it has been estimated that nearly half the world's population is now involved in some way in co-operative activity either as members, customers or suppliers. So what is the relevance of the co-operative model to social and economic organisation today? Is it a way—not the only way but one way—to achieve the inclusion and empowerment of individuals so that they truly feel they have a stake in society? All of us involved in co-operative activity would argue that it is, and today's debate will, I hope, show there is a solid basis for our belief. However, this belief is not only held on the Left. The Daily Telegraph of 12th January published, for the first time, the last article written by the late Lord Joseph before he died in 1994. The article included praise for the concept of mutuality in delivering pensions and other social services. Lord Joseph stated in the article,
"I believe the small mutual status of friendly societies keeps the quality of co-operative intimacy".
Mutuality goes to the heart of co-operative activity. A recent report on the mutual status of building societies remarked that mutuality is an attitude of mind as much as an institutional form. What has happened recently in a number of building societies might be taken as a warning by the co-operative movement. The decision to

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relinquish mutuality and to seek the status of a bank or a public limited company illustrates graphically what happens when large organisations lose touch with their members and their original objectives and the executive management becomes very powerful in relation to those individual members.
The sheer diversity of co-operative organisation beyond the traditional consumer and agricultural co-operative is perhaps not recognised widely enough. I shall give some examples of that. Taxi drivers, actors' agencies, market traders, the Wine Society and some symphony orchestras are just a few of the many activities and organisations organised on a co-operative basis. There are some recent examples of co-operation which underline its relevance to modern problems. The recent success of the Tower Colliery in South Wales shows what can be done when a group of workers band together for their mutual good. Tower Colliery is, I believe, the only coalmine in Europe which is run entirely by the miners who work in it and also own it. Even Mr. Michael Heseltine described it as "a model of common ownership"; or, as one of the miners put it rather well, it is "ownership by the commoners".
Credit unions are another example of co-operation. Formerly seen as relevant only to small groups of relatively poor people. they are now expanding rapidly. British Airways' employees now have a credit union, as do a number of other large organisations in, for example, local authorities, the police and transport services.
Another growing and interesting field of co-operative activity is in the delivery of health and community care. GP co-operatives, co-operatives of nurses and care workers and other groups involved in the delivery of healthcare, are springing up. One particular initiative in this field which actually resulted from a debate in this House, introduced by the noble Lord, Lord Donaldson, is a research study by the Department of Health involving the UK Co-operative Council into the relevance of community well-being centres to the objectives in Health of the Nation. Community well-being centres are, in effect, if not in legal form, community health co-operatives offering a holistic rather than a treatment-based approach to good health. I should pay tribute to the assistance of the Minister, the noble Baroness, Lady Cumberlege, in achieving that research study.
However, an important area of economic activity where I believe the co-operative movement has missed an opportunity is that of the public utilities. Even the most vehement defender of the privatised utilities cannot argue that they have yet found the right form of organisation fully to serve the public interest. Indeed, I would define them as public interest corporations which have much wider responsibilities than those set out in the Companies Act. There is increasing interest in the possibility of some form of mutual status, or for some other quasi co-operative structure which would better reflect the public interest than do the present organisations. I know that my noble friend Lord Haskel has some interesting ideas on the subject. As a recent article in the Guardian pointed out regarding the water companies,
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"Any manager of a mutual will tell you that he does not have to worry only about the people who provide the capital, the shareholders. He has to worry about the customers or 'members' too. Indeed, they may he the same people. The same two-handed approach should be used in the water industry".
There are some who would argue that that should also apply to the other utilities where there is a public monopoly.
The Coin Street housing and development programme on the South Bank has been aptly described as a,
"not-for-profit project … advanced by means of a balanced and mutually supportive programme of commercial and community developments whose first objective is to serve the public good".
As a tenant of one of the housing co-operatives in the development put it, "It really is like making a whole new start". Similar imaginative co-operative projects are developing in Manchester and elsewhere.
With the advent of Milk Marque the total turnover of agriculture co-operatives is now approaching that of the consumer co-operative movement. It is fair to say that farmers in the UK have traditionally been rather more reluctant to join co-operatives than their counterparts in Europe and America, but I suspect that this may well change as new systems of agricultural support make farmers increasingly dependent on the market place for their returns.
This very rapid over-view of a huge and diverse field of both social and economic activity has shown, I hope, that co-operation is much more than the Co-op shop or the Co-op funeral parlour—although the Co-operative Wholesale Society is the largest undertaker in the country, conducting one in four funerals.
There is a growing demand for people who are seeking to take a greater control of their lives in organisations which are better able to respond to their needs. Inclusion and empowerment are the terms which express that ambition. There is dissatisfaction with many aspects of the investor society. Public ownership structures in this country and abroad have been, or are being, dismantled. The co-operative model in a modern form could meet many of the objectives and aspirations of those who seek a better organisation of society, both socially and economically. But how should that be expressed in terms of legislation?
Some four years ago, when the United Kingdom Co-operative Council was founded, to succeed in some part the old Co-operative Development Agency, one of its first decisions was to set up a legal working group which is representative of all economic sectors of the co-operative movement. Some extremely useful work has been done by the legal working group with the Registry of Friendly Societies on the European co-operative statute but its main activity has been the drafting of a new Co-operatives Act. The work was completed last autumn and a very substantial piece of work it is. The UKCC is a representative and not a political organisation. As chairman I submitted the proposal for a Co-operatives Act for the United Kingdom to the Chancellor of the Exchequer, Mr. Kenneth Clarke, and the Secretary of State for Trade and Industry, Mr. Ian Lang. We know that both departments have overlapping responsibilities for co-operative matters. I am sorry to say that I have not

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even had the courtesy of an acknowledgement of receipt of the document. It seems that old-fashioned good manners are singularly lacking nowadays in government circles. However, I have made sure that the Minister, the noble Lord, Lord Mackay of Ardbrecknish, who will respond to the debate, has a copy. Courteous as he always is, I am sure that he will be able to give the Government's considered response.
Time does not allow me to go through the proposal in detail but it covers all those aspects where we feel that co-operative law needs to be brought up to date fully to reflect the role that co-operatives can play in both social and economic organisation. The sections of the proposal follow the form of an Act of Parliament and cover the following: a Co-operative Commissioner to succeed the Registrar of Friendly Societies, being responsible for the registration and supervision of co-operatives; the rules for forming a co-operative; its legal capacity; the membership; the rules; the shares and the capital; the management and administration; accounts and audit; supervision and disputes; conversion, amalgamation and transfers of engagements; insolvency and dissolution; and offences and proceedings to enforce the Act.
As I said earlier, it is a substantial and responsible piece of work. It was conducted by a group expert in co-operative law, and fully endorsed and supported by all the representative organisations in the co-operative movement in the UK. It deserves better than to be ignored by the Government. I look forward to the Minister's response.
In essence, the proposal sets out the arguments for a new Co-operatives Act to replace the Industrial and Provident Societies Act as the basis for the registration and supervision of co-operatives. It goes into great detail about what should go into the new Act.
I am glad to say that the Labour Party has accepted in principle the need for a new Act to provide co-operatives with a modern and effective legal framework, without necessarily endorsing all the detail in the United Kingdom Co-operative Council proposal. But work is continuing on that.
I hope that I have said enough to show that co-operation, far from being a relic of the 19th century, is still a vibrant form of organisation, well suited to the social and economic demands of a modern society. It was G.K. Chesterton who observed,
"Let us look to the future because that is where we are going to he".
I am confident that co-operation has a significant role to play in developing a society where ordinary people feel that they have a genuine stake in the social and economic prosperity of that society. I beg to move for Papers.
6.48 p.m.
Lord Sewel: My Lords, some 20 years ago, when I was vainly attempting to become a semi-respectable academic—that is before being seduced by the delights and subtle nuances of the Scottish Rate Support Grant Order—I was a member of something rather exotically
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called the Institute for the Study of Sparsely Populated Areas. I am afraid that that is why my speech will he somewhat off-centre this evening.
At that time one of the issues that most interested me was community development policy, in particular in relation to the more remote and so-called peripheral areas of northern Scotland. Many of the communities of north and north-west Scotland are economically and demographically among the most fragile in Britain. They are communities which have historically experienced high levels of out-migration, especially among young people entering the labour market, high levels of unemployment, a distorted age structure, and, regrettably they have too often exhibited the more depressing features of a dependency culture.
In 1976, the then Highlands and Islands Development Board, under the leadership of Sir Kenneth Alexander and with the inspiration of Mr. Robert Storey, introduced into British rural development policy the innovative idea of multi-purpose community co-operatives. There is some truth in the claim that previous conventional approaches to rural development have been excessively top-down, where development was something that was done to you, not always a painless experience. This had led in some communities to local cynicism, passivity and low morale.
Perhaps for the first time in rural development policy, the community co-operative approach allowed local people to be the active subjects of their own development. They were encouraged to have a stake in the future well-being of their own communities. I do not wish to overstate the case: there were failures and disappointments. Rural development is not an area in which prizes come easily. In total, I believe that somewhere around 30 community co-ops have at one time or another operated, engaged in a wide range of activities from running community and mobile shops to craft marketing and from tourism to knitting. By about 1990 there were in the Highlands and Islands of Scotland 24 community co-ops employing 375 people with an annual turnover of £3.5 million; and, perhaps more importantly, with 3,500 local shareholder members who on average had invested £100 each. This had been achieved in some of the most remote, most peripheral and most fragile rural communities in our country.
Creditable though those achievements were, I am convinced that the major contribution of the community co-ops has been in the way they changed the communities themselves, and above all in the growth of community self-confidence and self-belief. It is not coincidental that many of the communities that have subsequently benefited from the EU's LEADER rural development programme are communities that had the previous experience of community co-ops. That is at least in part because community co-ops, often for the first time, successfully developed enterprise skills. I had better confess that LEADER is a particularly difficult French acronym and I trust that on this occasion I may be excused from attempting a full pronunciation.
It is a delight to read in the White Paper, Rural Scotland: People, Prosperity and Partnership, the approving reference to the Laggan Community Co-op.

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The White Paper itself places considerable emphasis on partnerships, and partnerships are a good thing so long as they actually mean something and are not just formal and bureaucratic. I very much hope that the emphasis will be on creating partnerships which will provide a framework within which local activity, locally determined activity can flourish.
Rural development will not be achieved through sterile partnerships between the formal agencies, important as it is for those agencies to work together. It will not come through opening up our most fragile communities to the harsh winds of the market place. The best bet for strong, active, vital communities—especially in our more remote and peripheral areas—is through nurturing the social and human capital of those communities through co-operation and mutuality.
6.55 p.m.
Lord Rochester: My Lords, it falls to me to congratulate the noble Lord, Lord Sewel, on his maiden speech. We have listened to an interesting and informative speech, buttressed by the noble Lord's interest in community development. He also has experience of university teaching and administration and, I believe, of local government. With that background, I am sure that all noble Lords will agree with me that we look forward very much to further contributions from him to our proceedings.
For my part, I wish first to thank the noble Lord, Lord Carter, for having given us the opportunity to debate this important subject. I am especially glad that he has framed his Motion concerning co-operative action so widely. I propose to call on my industrial experience to speak mainly on the benefits of co-operative action in business.
It was in 1978 that the Co-operative Development Agency was established under the last Labour Government by the Bill passed that year. Its aims were to advise and encourage the development of co-operatives and to co-ordinate their activities. Speaking from these Benches at that time, I welcomed the Bill at its Second Reading. One of those taking part in the debate was Lord Jacques, a lifelong battler for the co-operative movement, whom I greatly admired. I know that all noble Lords will join me in taking this opportunity to pay tribute to his memory. In 1984 the Co-operative Development Agency and Industrial Development Bill provided further funding for the agency. At its Second Reading, Lord Grimond said that he attached the greatest importance to the furthering of the co-operative movement in all its forms. He considered that industrial organisation was one of the most serious problems facing the country. He did not accept that the only alternatives were state socialism or the creation of large conglomerates in the private sector: he believed that a third and very important method was to involve the workforce in the ownership and running of businesses.
Jo Grimond's last public affirmation of that belief came in a debate in this House on employee share ownership, in which I took part, only a few days before his death two years ago. I was much struck by
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something he then said: that we were watching an immense change in the balance of power between capital and labour. In the old days, mass labour, organised through its unions, exercised considerable influence; but now the way to get on in the world was to have some access to capital or to own capital. That being so, he thought it essential that the nation as a whole should have a share in the capital it possessed and that capital should not be confined to a small elite. He felt—and this is highly relevant to the Motion we are now debating—that this now permeates everything, not only businesses but also the social services, in which the clients are clearly distinguished from those who actually dish out the money. So he hoped that employee participation would also be considered possible in the running of the social services. Otherwise, in his view we would have a highly divisive structure and an extremely inefficient one. Coming from such a wise and far-seeing man, that certainly bears more thinking about.
The other day the Leader of the Labour Party came out in favour of what he called the "stakeholder society". Some of the media have fastened on that phrase as a new and exciting idea. It is nothing of the sort. I should remind your Lordships that ever since the publication of the Liberal Yellow Book in 1928 decentralisation of the structure of industry has been a major theme in my party's policy. The most significant advance in encouraging employee share ownership came from our initiative during the Lib-Lab pact when the 1978 Finance Act introduced tax relief for approved schemes. However, this form of ownership does not necessarily lead in reality to an increase in employee participation. Management has sometimes seen it merely as a means of bolstering incentives. In my view, therefore, measures to increase employee shareholdings should go hand in hand with action to develop employee involvement more widely.
In that connection I take pride in having "fathered"—if I may so put it—in 1982 the statutory requirement which now forms part of the Companies Act 1985 and prescribes that directors of large companies should include in the reports accompanying their annual accounts a statement describing the action taken during the preceding year to develop employee involvement in a number of specific ways. I am sorry that there is not time for me to enumerate those now.
In welcoming the Government's decision to continue and provide further funding for the Co-operative Development Agency in the 1984 Act, we nevertheless expressed scepticism about the way in which the Government then took power to wind up the agency by order. That of course is just what happened six years later. I therefore fully understand how it came about that as chairman of the UK Co-operative Council, which superseded the development agency, the noble Lord, Lord Carter, this evening put the case for a new co-operatives Act.
I appreciate that in introducing the debate today the noble Lord approached the subject from an angle differing from that which I have taken. Even so, I confess that I was surprised and a little disappointed that, unlike the noble Lord, Lord Carter, this evening, in giving the background to the project the UK

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Co-operative Council's legal working group made no mention of the excellent work done earlier by the Co-operative Development Agency. That is not to disparage the proposals of the working group—far from it.
I hope indeed that I have said enough to demonstrate that in earlier supporting the establishment of the Co-operative Development Agency and encouraging through suitable legislation the development of employee share ownership schemes and employee involvement generally, my noble friends and I have done all in our power, where appropriate by statutory means, to further co-operative action in the provision of social policy and in business.
The noble Lord, Lord Carter, will not, however, expect me at this preliminary stage to commit myself and my party to supporting the kind of co-operatives Bill for which, as chairman of the UK council, he canvassed this evening. If and when such a Bill is introduced, however, it will be plain from what I said that on these Benches we shall give it sympathetic consideration.
7.1 p.m.
Lord Gallacher: My Lords, the ending of mutuality by large building societies places co-operatives in an even more important social position. The Building Societies Act 1986 gave societies most of what they asked for. Yet in under 10 years major societies seek banking status. They will doubtless say that they must compete with banks and other financial institutions. Mutual insurance societies also seek to change.
Parts of the co-operative sector may be small by comparison with building societies. But, in total, co-operatives constitute a very large movement, with several growth areas and international status.
Her Majesty's Government seem to leave growth of the co-operative sector to mainly voluntary bodies. That may not be enough in certain cases. Agricultural co-ops were once promoted by a government funded central council. The council's functions were subsumed into the Food From Britain organisation, but have since been dropped. Preference appears to be for non-co-operative agricultural organisations. Is that a long-term prospect, and how does it compare with structures in other European Union countries?
The Housing Corporation is a major public and promotional body, and is much used by Her Majesty's Government. Par value management co-operatives are in evidence, as is the transfer of housing functions from local authorities to housing associations. Equity housing co-operatives, owned collectively by members who share in the equity, have diminished since the 1980 Housing Act enabled members to buy their homes at their outstanding debt. The co-operatives are usually registered under the I&P laws and are not in general grant aided. The Housing Corporation seems passive in its attitude to equity co-ops. Yet there must be a role for them, even in today's climate of negative equity. Cannot the Housing Corporation be encouraged to become more active in this area?
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The Labour Government that ended in 1979 had two significant co-operative achievements to their credit: the creation of the Co-operative Development Agency, which operated from 1978 to 1990; and the passing of the Credit Unions Act 1979. The Co-operative Development Agency tackled the re-establishment of workers' co-operatives in Britain and, although modestly funded and devoid of either loan or guarantee facilities, it succeeded in resurrecting the self-employed concept which inspired the 19th century Christian Socialist Movement. Though individually small, workers' co-ops are large in total. It was a harsh decision by the present Administration to wind up the CDA, but growth continues and local authorities in particular have been very helpful with promotion and in other ways.
Credit unions were about the last legislative creation of the Labour Government. Based on Northern Ireland law, the 1979 Act was geared to small sized credit unions. Recent changes should allow larger unions to be formed. The World Council of Credit Unions is a major body, making significant social and economic contributions in both developed and emerging countries. It is to be hoped that growth in the United Kingdom will soon compensate for our late start in this area.
The noble Lord, Lord Sewel, spoke eloquently about community co-operatives. These co-operatives can take almost any form their members desire, whether in urban or rural areas. In a debate in this House on rural policy on 10th May last, I suggested that there was scope in rural areas for all-purpose community co-operatives. These could embrace a shop, pharmacy, sub-post office, pub, health centre, and even a village hall. A successful rural community co-operative would be able to cross-subsidise different enterprises, provided there was viability overall. Retail co-operatives have operated in this way for a century. The Rural Development Commission has shown commendable interest in village shops and has given grants to village halls. Her Majesty's Government recently expressed willingness to follow the Norwegian example by abating rates liability on village shops. That opens up co-operative possibilities which did not exist when I spoke in May.
In addition, the December issue of the newsletter issued by the National Lottery Charities Board includes in grants programmes for 1996–97 two themes which are an open door for an experiment in rural community co-operatives. These are concerned with improving people's living environment and community involvement. I suggest that the Rural Development Commission and the United Kingdom Co-operative Council might jointly and usefully encourage a village to apply for a national lottery grant with the object of establishing a community co-operative on a trial basis. We may not achieve what has been accomplished in the Highlands and Islands, but the opportunity is there.
So far as a new co-operatives Act is concerned, I prefer to see a draft Bill to give effect to the wide-ranging proposals that the United Kingdom Co-operative Council put forward following extensive consultations with representative bodies and persons.

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While co-operatives, irrespective of type, have a common idea, their diversity is astounding. Legislative harmony in these circumstances may not be easily achieved. The Credit Unions Act 1979 sits well with the main Industrial and Provident Societies Act of 1965. This fact may not escape the draftsmen when they begin their task of drafting a new law to take account of modern co-operative requirements. That law is due. I hope that, in the light of what my noble friend Lord Carter had to say this evening, consultation upon it will not he unduly delayed by the present Government, who profess sympathy for and interest in the co-operative idea.
7.7 p.m.
Lord Sefton of Garston: My Lords, it is natural when speaking on a subject such as this and looking for an example of co-operation that one looks to home. People who visit Liverpool, especially by sea, will remember the Liver Building. It is the headquarters of one of the largest friendly societies in the world. The theme to which I address myself is the effect that mutual societies and friendly societies have on community, and the opposite—how, if one moves away from mutual aid and co-operation in society, one gets a different attitude entirely. Therefore I start with the Royal Liver Friendly Society. I am quite certain that if there is any attempt to convert the RLFS into a plc it will be resisted strongly, mainly because of the underlying belief in the idea of mutual aid that exists at its very heart.
The society started after the Irish famine, when members of the Catholic Church, who of course have a very keen interest in how children are treated after death, were appalled by the fact that small babies were being buried in margarine boxes with hardly any ceremony at all. They started a burial society. It became the largest friendly society in the world. That ethos is still there; the community is still there; and it still believes implicitly that that is the way to move forward. I do not think anybody, even given all the persuasive powers possible, can convince its members to become a plc.
That is the important point when debating co-operation. Like others, no doubt, I had a list of points but they have already been disposed of in the speech of my noble friend Lord Carter. I have no intention of going through them again except to mention once again the Tower Colliery, the National Freight Corporation and the Co-operative Retail Societies. Those are all examples of co-operation. As I said before, they lead to a belief in activity in the society for the society's benefit.
There were other forms of co-operation. They were called public utilities. The co-operation which existed in setting up the water supply for all the major cities in this country was a tremendous form of co-operation. Not only did they co-operate within their own boundaries; they co-operated beyond them. Liverpool in particular had to go to Wales because geographically that was where the water was found. Liverpool had to convince the people of Wales that they should have a partnership
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and should co-operate, which they did. Now there are two very strong communities in North Wales which owe their very existence to Liverpool Corporation.
Then there is the electricity board in Merseyside. I have spoken about it before and I shall do so again in this House. If we ignore what it did, we shall pay a very heavy price indeed. Mutual aid and reliance on one's neighbour to create a better society are on the run. They are on the run because some people believe that money is the one essential. If one has a lot of money in the bank one is called successful. We have now reached the stage where money has replaced any desire to do good. Nowadays we hear footballers who have been brought forward on a little football team and grown big on football say that they are very keen on football and like British football. When they are offered millions of pounds to go to Japan or somewhere else, they say that they are not going for the money but because they are facing a challenge. That is tripe. They are going there for the money.
One sees in the press and on television that such and such a mutual society has decided to become a plc. Has it? I do not think so. The society has not consulted the members. The bosses at the top—the £4 million men, like the man who, it was reported in today's Guardian, earned in the City of London £11 million in one year (it was thought fantastic to have a lottery prize of £11 million but think of being paid £l1 million in a year)—decided that it would be better to have a plc instead of a mutual society, because that would leave them free to do whatever they wanted with it. What is the net result? The net result is that all kinds of glorious offers are made to the members, offers such as, "If you vote as we want you to vote, we shall give you £500". That has become so rooted in our society that some of those members do not even realise what they are doing. They are being bribed with their own wealth to move the society into the ownership of a few individuals. That is the net result when the operation is carried through.
Only today I picked up a box of matches and read on it "England's glory". They once said that once matches were manufactured in Liverpool. The box says "England's glory" and in the small print "Made in Sweden". In this country today one cannot buy a match made in England. Guest, Keen & Nettlefold does not make screws any more in this country. Rover cars are made in Germany. I could continue with a long list.
In conclusion, it has now been established that 80 per cent. of our manufacturing industry is to be found in a colony—a colony controlled by foreigners. There is a hard fight in front of us to reconvert this country to the principles that we held dear, to return to the principle that we in this country should be the ones who control the country. Let us look after our own affairs.
7.15 p.m.
Baroness Nicol: My Lords, until a moment ago I thought that I would have the unique experience of addressing completely empty Conservative Benches, apart from the Minister and his Whip. I am very glad to see that a couple of noble Lords have now arrived.

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I too was interested to learn from the deputy Prime Minister last Thursday that co-operatives have now joined the Conservative Party's hate list. He said:
"The stakeholders that the Labour party would bring back are all our old familiar Labour friends—the unions, the single-issue pressure groups, the local authorities and the co-operatives".—[Official Report, Commons, 11/1 /96; cols. 328–329.]
He then listed those who enjoyed the support of his party—a list which, needless to say, did not include the co-operatives or the local authorities.
I am aware that the Conservatives have never been very keen on co-operatives, except at one point when they decided that co-operation did not involve the unions and therefore it could be a good thing in certain circumstances. But I have not before heard quite such a bald statement of opposition from a senior member of the Government. I look forward to hearing whether the Minister feels that that is Conservative policy.
There are many reasons why any government of the United Kingdom should give positive encouragement to the formation of co-operatives. The attitude of the Conservative Party, if it is as expressed by the Deputy Prime Minister, is hard to understand. My noble friend Lord Carter has given us the history of the movement and I shall not go over it again. But I understand that there has been a marked growth in the number and variety of worker and other co-operatives in the past decade or so.
Worker co-ops are formed for many different reasons. Sometimes it is because those involved have found difficulty in breaking into the labour market, for reasons of race or disability. However often we may say otherwise, it remains true that people of different race or those who have disabilities do not find work so easily as their white or able-bodied counterparts, especially in the present situation of high unemployment. There are also those who, as my noble friend Lord Sefton of Garston, indicated, prefer the ethics of co-operation and are not happy with the increasingly competitive and selfish society in which we are now obliged to live. Yet they have skills to offer and they have the will to work. Worker co-ops can give them opportunities to use those skills and retain their independence; and, incidentally, they can also remove them from the unemployment register, which I am sure is attractive to the party opposite.
However, there are other benefits. Worker co-operatives are usually local enterprises which remain local. They bring stability to the community in a way that outside business investment does not always do. We are all familiar with the factory built on the greenfield site which flourishes for a couple of years and then is left derelict and empty. That does not happen with most local co-ops. Stable local communities must in the end help to bring a nationally stable society. A population on the move is destructive of social cohesion and is a factor in the weakening of so many family ties.
Farmers and fishermen are increasingly discovering the advantages of co-operation in marketing their products and in many other ways appropriate to their industries. Farmers find that it pays to apply the
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principle to the purchase of feed and fertilizer and to the acquisition of expensive machinery which otherwise would be beyond the reach of many smaller farms. In mainland Europe, that particular movement in co-operation has progressed very much further than Ours.
There are many different ways of organising co-operatives, and they provide a wide diversity of products and services. But the golden thread uniting them all is that they are run by and for those who do the work rather than for investors and shareholders. And because the employees own the business, they can and do take pride in their work. Many of them give a service which could not be provided in any other way.
Not all co-operatives are small. For example, Heathrow Airport Licensed Taxis has 2,500 members. There are numerous examples of co-operatives which can wield considerable buying power. One of my noble friends mentioned the Wine Society, which brings comfort to many thousands of people, not all of them realising that they are supporting a co-operative.
I am delighted to learn that in Boston in the United States co-operatives have been formed via the Internet. That provides interesting possibilities. If that takes off worldwide, who knows how powerful the co-operative movement will become? An idea which is 150 years old in this country since it began in Rochdale may become the way of business for tomorrow worldwide.
I hope therefore that the utterance last Thursday was evidence that the Deputy Prime Minister was again carried away by his own rhetoric and was not suggesting a Conservative Party policy to oppose co-operation in all its forms. Such a policy will fall foul of many prospective Conservative voters and, though I might welcome their disillusion from a political point of view, I would not welcome attempts to make life more difficult for existing co-operatives or to discourage the establishment of new ones. The co-operative way of doing things is a valuable part of our lives; it should be encouraged and not denigrated.
7.21 p.m.
Lord Monkswell: My Lords, we all owe a debt of gratitude to my noble friend Lord Carter for introducing this debate and for so effectively explaining the background and the current reality of the co-operative movement. When I saw the terms of the debate I immediately felt that I had to contribute to it. As a member of the co-op party, a supporter of the co-op movement and a practical co-operator, I felt honour bound to take part.
I planned to speak on three main themes. The first was the result of competition as opposed to co-operation when military action is undertaken. A prime example of that was the lack of planning and co-operative action between different elements of military forces in the Dardanelles campaign, which resulted in the horrors and agonies of Gallipoli in the First World War. The benefits of combined co-operative action were demonstrated in the Normandy landings on D-Day. Of course, we must recognise that the ultimate result of competition rather than co-operation is war itself.

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I also intended to talk about the problems for society, the individuals in society and the relationships between individuals when men and women are pitted against each other in competition instead of realising that they are different and are designed to complement each other and to work and live in co-operation with each other. However, this is a time-limited debate and it will come as no surprise that I do not intend to elaborate on those matters. I felt that it may be useful for me to concentrate my remarks on the situation and the need for co-operative action in the field of industry and commerce.
One of the most salutary aspects that we need to appreciate is the purpose of enterprise. We have been led to believe—I feel erroneously—that the object of a company is to maximise returns for its shareholders. That is wrong. To understand an enterprise, whether it be a school, a hospital, a railway or an industrial company, we need to look at what it is doing. The object of a school is the education of children, not the return on capital investment; the object of a hospital is the care of the sick; the object of a railway is to move people and goods in trains between A and B. The object of a water undertaking is to supply water. We can see that recently, with the changes that the Government have engendered in the water industry. The water companies seem to have lost track of that requirement and to be concerned only with dispensing money to shareholders, senior managers and directors of the companies. The object of an industrial company is to produce the goods.
Perhaps I can take an example from my own experience. For 20 years I worked for Massey Ferguson, the largest tractor manufacturer in the western world—that may be familiar to my noble friend Lord Carter. When I joined the company in 1969 I was told by members of the company that they were proud to be involved in an enterprise that produced the best tractors in the world; in fact, some described it as the "Rolls Royce" of tractors, though I am not sure that that was a good allusion. However, I had a strong feeling that people involved in the enterprise were proud of building tractors and mechanising agriculture. The company was working with its suppliers, its distributors and customers in a kind of gigantic co-operative enterprise through co-operative action to produce the goods to mechanise agriculture.
For the first 10 years with that company I saw it grow and expand. We opened new factories; we took over other companies; we expanded production. We were not only supplying machinery to mechanise and improve the mechanisation of agriculture in this country, but we were also exporting around 80 or 90 per cent. of our product overseas, much of it to developing countries to improve their agricultural standards. We employed thousands of people in a number of factories in this country and thousands of people around the world in different factories.
One of the sad things that happened with the election of the Tory Government in 1979—it was immensely shocking to me—was that the reaction of management was to turn round to the unions, their suppliers and customers and say, "It is our job to manage and we shall run it all ourselves. We shall tell you what to do". The
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concept of co-operation that had existed in the 10 years previously completely went out of the window. From that point on the company deteriorated. When I left the company 10 years later we were producing one-third of the product that we had produced in 1979 and the number of employees in the company was reduced commensurate with that. We closed factories not only in this country, but throughout the world.
It is a salutary lesson that when that industrial enterprise lost track of the need, first, to produce the goods and, secondly, to work co-operatively with suppliers, distributors, customers and its workforce, it went downhill.
7.29 p.m.
Baroness Dean of Thornton-le-Fylcle: My Lords, I join with other noble Lords in thanking my noble friend Lord Carter for initiating this debate. Co-operatives arc little discussed and it is true that the public perception and the reality are miles apart. Quite often people think about co-operatives as the co-operative movement which has affected many of the lives of British citizens with the growth of the movement itself.
My noble friend Lord Carter called for a new law, and he is right. This is a growing area which needs to be more clearly defined and needs to have a better structure in law than it has at the moment. My short contribution to the debate will be based upon my experience in the employment field. Traditionally, co-operatives have grown up in small communities, in urban and rural areas. That has been my practical experience. Many people become co-operators not for any ideological reasons or because it was ever their intention, but quite often because the organisation in which they worked has closed down. They had a choice between dependency on unemployment benefit or trying to do something for themselves by forming a co-operative. That often happened with small numbers of people. Indeed, the developments in new technology, particularly in the publishing area, have encouraged that. Extremely far flung communities join together in co-operatives to create employment which otherwise would not exist.
One area of success has been women returners. One can see examples of women who have perhaps married and have young children. They cannot get a job but want to be independent; they may not have transport and there is no work in their area. Such women join together and start to become independent. That should be encouraged. In my experience, many of the people working in co-operatives would otherwise be dependent on the taxpayer. But they are not.
As co-operatives have grown they have gone out and created jobs and have in many areas become part of what I would loosely call the establishment. The Wales Co-operative Development and Training Centre has support from the Welsh Development Agency, the Development Board for Rural Wales, the European Union and local authorities. It has created 450 jobs. I should like to give another example, one from which the Minister will take great satisfaction if he does not approach this topic with a closed ideology. I am sure

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the noble Lord does not. The employee ownership scheme in Scotland, which was formed in 1977, is the largest in Europe. Until recently all the co-operatives in Scotland had a combined turnover of £40 million. The sum now is £200 million.
I raise that point particularly because of an interesting development in Scotland. One of my roles as a trade union officer was to represent people working in the paper-making industry. Paper mills need to be near water. Quite often one would find that a paper mill was of' itself an identifiable village. There would be no other work in the area. Indeed, it was one of the last industries to have tied cottages. The Minister will know that there is lots of water in Scotland and so there are lots of paper mills in Scotland. There are also in the water lots of salmon which go by paper mills. In Scotland there is a paper mill called Tullis Russell. It was a very successful family company which employed hundreds of people in a large acreage of plant. When the company, through hereditary means, was taken over by the grandson of the original owner, he decided that although it was a successful company the way forward was to hand it back to the workforce. It was not done as cleanly or as straightforwardly as that but, in effect, that is what has happened. The company today is part of the Employee Ownership of Scotland. It has a £200 million a year turnover and maintains its independence, but it uses all the values of the co-operative movement.
Large organisations like that are not the norm in the co-operative movement outside of—my noble friend Lord Graham may correct me later on this—the Co-operative Society itself, which is an enormous organisation. Small businesses need business skills. That is where the structure of the co-operatives comes in. They often need training. That is another area where the structure of the co-operatives comes in. They need financial advice. That is a further area where the structure of the co-operatives comes in. As employment and work structures in Britain are changing, and will continue to change, as people look for different ways of working and living, we will find that co-operatives increase in number. I believe that the call by my noble friend Lord Carter is timely and I hope that the changes in law which he proposed will gather wide support.
7.34 p.m.
Lord Taylor of Gryfe: My Lords, I, too, must declare an interest. I am a member of the co-operative party and I am a member of a co-operative society. The noble Lord, Lord Gallacher, who is sitting in front of me, and I started as boys in the co-operative movement. My original commercial and industrial experience was gained as a member and as an employee of the Co-op.
In those days it was a considerable organisation in Scotland. Co-operative trade at the moment is around 6 per cent. of national trade. It was not uncommon in Scotland to have more than 20 per cent. of the national trade in co-operative hands. In fact, the co-ops preceded some of the modern industrialists. We took two items, bread and tea, and said that they were the basic items. We established a vertical integration, bringing wheat
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from the co-operative wheatfields of Manitoba, milling it in co-operative mills here, baking it into co-operative bread in co-operative bakeries and putting it on the counter of the co-operative housewife. They preceded the modern industrialist by many years. They did the same with tea. It was a delight to go out to Sri Lanka to see the Scottish Co-operative Wholesale Society tea plantations. Such was the power and authority of co-ops in those days.
I regret to say that co-ops—everyone will admit this—were a little reluctant to adapt to change. As co-operatives, we have to confess our weaknesses in that regard. It is a sad sight to travel around Scotland and see the familiar co-operative premises now closed or being taken over for other purposes. But that should not minimise the considerable contribution which co-ops have made, and will make, to our social well-being.
I congratulate the CWS on taking the initiative in consumer protection by insisting on the honest labelling of products. I pay tribute also to the vast and powerful Co-operative Bank which has initiated a policy of ethical investment of Co-operative Wholesale Society or Co-operative Bank funds. Those two institutions are certainly maintaining the traditions and some of the ideals for which the co-operative movement was established.
It would be wrong to discuss the weaknesses and strengths, the difficulties and the past of the co-op at this stage. I am concerned about supporting the Motion of my noble friend Lord Carter. I believe that the co-op idea is appropriate for the present. We are facing a situation in our society of power becoming increasingly centralised—in government, in industry, in communications and so on. This means that citizens feel powerless and alienated. Democracy is suffering from the size of institutions and organisations. I very much regret that some of the mutual organisations, like the building societies and the insurance societies, are now finding their way into being limited liability companies at a moment when the need to involve people is more and more necessary.
I remember that we debated in this House the Trustee Savings Bank, which was taken over and is now part of one of the leading clearing banks. We were given certain assurances about retaining the integrity of a mutual organisation. That has since disappeared. Society will he poorer if one has a continuing decline of the mutual organisations like the co-operative societies in all their varieties, in agriculture, in retailing and in credit unions. Society will be poorer if these institutions decline. So it is important that this debate today should concentrate on that problem. We should give full support to the work of the agency over which the noble Lord presides and get increased support for the co-operative idea.
7.40 p.m.
Lord Rea: My Lords, I shall speak for a very few minutes only about the scope for co-operative action in community care. As a general practitioner, I was not actually involved in the setting up and running of care services provided by social services departments—the home help services, meals on wheels, residential

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accommodation, sheltered employment or social care for mentally ill and mentally handicapped people in the community—but I frequently called on those services for my patients.
However, even in the London boroughs of Camden and Islington, which used to have a good reputation for care services, these services have become less adequate in recent years. The result is that elderly or mentally ill patients discharged from hospital are not getting the package of home or community care that they need. Too often they have to he readmitted as emergency cases. That is not the entire reason, but it is part of it, why the proportion of emergency admissions is increasing, since Camden and Islington are not isolated examples.
The social services are now required to purchase—which is the term usually used—rather than themselves provide, most of their community care services. The debate about whether that was a correct part of the community care Act continues. However, on the principle that if you can't beat them, join them—referring to my Unstarred Question of last night, that is something which the Chechens seem not to be very willing to do—there are big opportunities not simply for the private sector but also for the voluntary and co-operative non-profit-making sector, as my noble friend Lord Carter and other noble Lords have pointed out.
The co-operative sector has the added advantage of including the carers and the clients, when they are able, as part of the caring service. In his maiden speech, the noble Lord, Lord Sewel, pointed out how communities grow in stature when they are involved in their own development. At present the Community Care (Direct Payments) Bill is passing through your Lordships' House. In answering this debate I wonder whether the noble Lord, Lord Mackay, can tell us whether the direct payments envisaged could, with the carer's or client's permission, be channelled into co-operative schemes as outlined by my noble friend, to provide care in the community for disabled or elderly patients. These are developing in various parts of the country, particularly in Scotland, and they are also common in Scandinavia and particularly in Italy.
I suggest that non-profit or shared profit community care schemes not only have the advantage of involving the clients and the carers, but they have the potential for providing better value for money than the private sector, where the profits of shareholders or owners tend to take top priority. Co-operative schemes will make the welfare of the patient in the community their top priority because patients and their relatives will themselves be directly involved in running them.
7.45 p.m.
Lord Haskel: My Lords, I am most grateful to my noble friend Lord Carter for giving us this opportunity to debate co-operatives. I should like to speak on how they measure up to modern business pressures and I hope that I shall do so in a more balanced way than the Deputy Prime Minister did last Thursday.
Business is rediscovering the co-operative ideal in new forms and new ways. Stakeholder economics go back to the roots of co-operation. Some of the modern
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ideas in management are returning to the basic principles of the co-operative. As the noble Lord, Lord Carter, told us, what we used to call "co-operation" we now call "empowerment". As my noble friend Baroness Nicol said, that motivates both management and work people to rise above themselves to produce extraordinary results.
Nobody can disagree that over the years co-operatives have been wonderful for motivating people and providing incentives. But, sadly, motivation does not ensure success. One of the greatest fallacies in modern business is the idea that motivation and incentives ensure competence. This is proven by the large number of co-operative companies which have failed, and the large number of businesses run by highly motivated and dedicated families which fail every year.
That is because, like all businesses, co-operatives have to ensure that the essential competences of a business are maintained at all levels. Often that must be done by bringing in outsiders and relegating many of the originators of the co-operative to a subsidiary role. The notion that ownership should entitle members to a management role is as flawed in a co-operative as in a traditional family business.
Then there are the practical difficulties regarding the supply of sufficient capital. Some enterprises require little capital to start up and can operate as co-operatives on the savings of its members, but a co-operative soon runs into difficulties when more capital is required. If a co-operative has to seek loans or external equity, the full notion of the co-operative will be undermined unless it can come to some special arrangement.
Perhaps the John Lewis Partnership is a case in point. It has not issued equity for many years; nor has it gone in for excessive borrowing. The result is a well-run business with a sound but unspectacular rate of growth, which satisfies the customers, satisfies the partners, but would not perhaps satisfy the City.
Here we have the crux of the matter in business terms. The City's current obsession with shareholder value as a first priority is in stark contrast to the best management practice in a co-operative, which is first and foremost to look after one's customers and market. As Professor John Kay has pointed out, there is no clear link between shareholder value and customer satisfaction. Clearly, then, British industry has a lot to learn from the co-operative movement about shared risk and reward, and about incentives and motivation. But, equally, co-operatives have a lot to learn from other sectors of industry about capital flexibility.
Nevertheless, the question of the distribution of earnings can also be a tricky problem for co-operatives. In any business in the early stages there is generally little room for distribution as earnings must be retained. Co-operatives are no exception. The members have to be patient and this can be either a happy or unhappy experience. For some of the founder members of the National Freight Corporation, it was clearly an unhappy experience. The survival of the enterprise required that some of the founder members be made redundant. Certainly working in a co-operative gives you a say in your destiny at work, but the pressures of the market

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nowadays are inexorable, and the say you have in controlling your destiny may be to make yourself redundant or, indeed, to close down the enterprise.
Yet, although co-operatives must compete in the market and get all the dynamics of management right in order to succeed, they have two great advantages over their competitors. The first is the spirit and commitment of the members. The fruits of co-operation from the greater involvement and participation of the members, the consultation which takes place, and the broadly based remuneration schemes which spread the fruits of success throughout the enterprise, all have a significant effect on the business.
The second advantage is quite simply that the business is owned by customers or employees and there is one stakeholder fewer to satisfy. This means that the others can have better returns or that more money can be retained in the business.
I agree with my noble friends Lord Gallacher and Lord Monkswell that perhaps the local electricity and water companies should have become co-operatives. They are natural monopolies and would perhaps operate with more concern for the consumer as consumer co-operatives and thereby require less regulation than PLCs. Having missed the opportunity in past privatisations, perhaps the Government will consider that alternative in the future.
As many noble Lords have said, co-operatives have performed well as local enterprises. That is why they should be encouraged by the local development agencies. I hope that the Minister can assure us that the business links and DTI agencies are fully briefed on the advantages of co-operatives and will encourage them. After all, the prime determinants of any business enterprise are the competence and vision of all those working in the business, the adequacy of finance, luck and good motivation. Without doubt a co-operative ethos wins every time as far as motivation is concerned.
7.52 p.m.
Lord Graham of Edmonton: My Lords, I begin by saying that my noble friend Lord Peston would very much have liked to participate in this debate, but I am glad that he asked me to do so on his behalf.
We have had a valuable short debate which was clearly needed not least by those who claim to assert that the co-operative idea is a good one and can be extended into many fields of economic and social activity.
My noble friend Lord Carter got us off to a splendid start with his tour d'horizon touching on significant areas of co-operative enterprise. His prime credential as the chairman of the United Kingdom Co-operative Council equips him to lead this debate and we are indebted to him for that. His call for a future Government to assist the co-operative sector by legislating for a Co-operative Act is soundly based, well argued and deserves to be taken seriously.
Alas, this debate was cruelly deprived of a certain participant with the death of our parliamentary colleague, the late Lord Jacques of Portsea Island. The
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reference to him by the noble Lord, Lord Rochester, was deeply appreciated and very touching to many like myself. For much of his life, Lord Jacques was "Mr. Co-op", especially in his fiefdom, the Portsea Island Co-operative Society. There are too few genuine original thinkers in business or in community affairs today. Just such a man was John Jacques. He personified the good qualities outlined by many speakers in this debate as epitomising sound co-operative practice and principles. His death has robbed the nation of a great public servant and the co-operative movement of a true co-operator and a leader of exceptional worth. We shall miss him greatly.
This debate has helped to underline that co-operative action has been, is, and will continue to be, the way out of many social and economic problems facing, in the main, the poorer sections of society. The idea of mutuality is not new, nor is it revolutionary. It is plain common sense that those in need should have access to a source of help in one of many ways. We have heard tonight of the wide spread of co-operative ideas, the application of co-operative methods, the easy adaptability of the co-operative ethic to many of the problems facing the world. This debate seeks no more than to bring to the attention of a wider audience the fact that by itself the existing co-operative movement can do, and is doing, much but, with a little help from its friends, can do a great deal more.
I am so glad that through the medium of this debate it has been shown that co-operatives are not exclusively "the Co-op shop on the corner". In the aftermath of the celebration of being in the high streets of the nation for more than 150 years now no one can take away from the consumer movement the fact that it has made and is making a tremendous contribution to the economic and social fabric of life—not only here in Britain, but throughout the world. The idea that it need not be capital, not employees, not government but consumers who are in the driving seat is a concept given to the world stemming from those same Rochdale pioneers—a concept that can never be erased. But it is high time that the contribution made by the co-operative principle in many other spheres of human activity was properly highlighted.
One thing is for sure: the amateur, sincere, but often inexperienced trading concepts displayed by those early pioneers have no place in modern society. That which we know as "the Co-op" may have, more painfully than others, come to accept that in the 21st century there is no place for the second best. That point was made effectively by my noble friend Lord Taylor. To strive for the very best practice must be the guiding light in all forms of co-operative.
In Britain today such elements of the British co-operative movement will not survive unless the consumer chooses the co-operative alternative in preference to any other. The days of absolute loyalty or devotion are in the past and, although every company yearns for that support, it has to be won, kept and nurtured. Again, that point was underlined by my noble friend Lord Taylor. To have that loyalty expressed in cash to the value of £14 billion in trade per year is no mean achievement, but in today's markets no one rides

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on the back of others. That is why those like myself who are intimately associated with current co-operative practice accept their responsibility for making what we have as efficient as can be, and accept our role as proselytisers the better to widen the co-operative net. And why not?
The Minister may support a thesis which asserts that there are only two ways of organising life—by the state or by capital. We say that there is a middle way, where the individual need not be a slave to either, but can enjoy the benefits of both and forge an even better alternative.
What a joy it was to listen to the maiden speech of my noble friend Lord Sewel. His decision to dive in at the deep end a week after his introduction took courage, and to have done so with the style and authority that he displayed encourages us to believe that he will speak here often. We all look forward to that.
My noble friend Lord Gallacher stressed the wide application of the co-operative idea in many spheres of non-retailing activity, housing, credit and rural life being but a few. My noble friend Lord Sefton showed his deep understanding of human needs and his feel for what makes Liverpudlians tick. Mutuality was the talisman which he proudly held aloft. My noble friend Lady Nicol reminded us of the value of worker co-ops and gave many interesting illustrations, relating not only to Britain but to countries throughout the world. My noble friend Lord Monkswell effectively gave us practical examples of co-operation. My noble friend Lady Dean brought her industrial experience before the House and told us how co-operatives had served many workers and communities. My noble friend Lord Taylor strongly pledged his continuing support for the co-operative idea after his lifetime of association with the co-op. My noble friend Lord Rea gave us yet another dimension of co-operative practice when he referred to its application in health provision and my noble friend Lord Haskel talked of the powerful force of co-operation in motivating business and people at work.
More than one speaker referred to the fact that in a parliamentary exchange last week the deputy Prime Minister saw fit to take a swipe at co-operatives. On 11th January, at col. 328, he sought to denigrate them, listing them as one of the usual suspects, the "old familiar Labour friends". The bile of the deputy Prime Minister notwithstanding, the co-operatives were in very good company; the unions, the single issue pressure groups, the local authorities and the co-operatives.
The House will know that, besides being friends of Labour, they also have in common the fact that they represent many, many disadvantaged people and communities, all of whom have learnt to regret the fact that we do not have a Labour Government and will be grateful to the deputy Prime Minister for grouping them together as "familiar Labour friends".
The deputy Prime Minister compounded his ignorance as well as his prejudice when he went on to say:
"A stakeholder society in a Conservative world … is all about home owners, share owners, pension owners, choice, freedom and a competitive society".—[Official Report, Commons, 11/1/96; col. 3291
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That is what co-operatives are all about too. Thanks to the deputy Prime Minister, we know not only where our friends are but where they are not. Stakeholding is as old as—well, at least as old as the principles of the Rochdale pioneers in 1844. Co-operatives are proud, as are co-operators, to be stakeholders. The case for a greater public awareness of the value of the co-operative tool should not be in dispute. This debate has clearly demonstrated that the co-op is alive and thriving and can be even more so in the years that lie ahead.
8.2 p.m.
Lord Mackay of Ardbrecknish: My Lords, my first task is to undertake two pleasant duties. I congratulate the noble Lord, Lord Carter, not so much on having this debate but on his birthday today and on sharing at least a small part of this evening with us. Whether his belief in mutual co-operation will extend further than the debate to an invitation to help him celebrate his birthday remains to be seen.
My second pleasant task is to congratulate the noble Lord, Lord Sewel, on his maiden speech. When he mentioned the rate support grant at the beginning of his speech there was a small hint of a connection with local authorities. In making that one small mention he slightly underplayed his important role in Scottish local government for many years. He was the leader of Aberdeen District Council. Unfortunately, the Labour group tends to run Aberdeen District Council more often than not. That does not prevent me from saying that Aberdeen is one of my favourite cities in the United Kingdom and, despite its administration, it is always a joy to visit the city.
The noble Lord was also the president of the Convention of Scottish Local Authorities. I suppose that that is where his knowledge of the rate support grant comes from. During my time in the Scottish Office it was said—I cannot quite remember the precise phrase—that only two men understood the rate support grant. I certainly was not one of them and I cannot recall the noble Lord being one of them either. However, his interest in the remoter communities in Scotland and in the co-operative movement there brought him to make his maiden speech in this debate. Coming as I do from the West Highlands, I can certainly echo the importance there of community co-operatives of various kinds. Perhaps the reason why the noble Lord made little mention of local government was that sometimes there is little co-operation there.
This week I have been privileged to hear three maiden speakers. I was not present during the earlier debate today, otherwise I should have heard five. All three have been Scots, which has given me particular pleasure. Indeed, one was my noble and learned friend the Lord Advocate, who joins the Government. Some of your Lordships may be forgiven for coming to the conclusion that one has to be a Scot to join the Government and that it certainly helps if one's name is Mackay. After the noble Lord, Lord Sewel, the noble Baroness, Lady Smith, and my noble and learned friend the Lord Advocate, it may look as though one has to be a Scot to get to the House of Lords too.

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That leads me to the inevitable conclusion, which I am sure the noble Lord, Lord Sewel, will also come to quickly, that with such strong Scots representation in this House and down the Corridor there is no need to go down the dangerous road of devolution and remove the Scottish influence from this Chamber and from the other place. However, that is a debate for another day.
Perhaps I may say on a serious note that, although I did not know Lord Jacques, I understand the affection in which he was held by many Members of your Lordships' House. I looked quickly at Dod, and it is sad that he is not present for a debate such as this which would have been very close to his heart.
Lord Graham of Edmonton: Hear, hear!
Lord Mackay of Ardbrecknish: My Lords, my right honourable friends the Chancellor of the Exchequer and the President of the Board of Trade are sorry that the noble Lord, Lord Carter, feels slighted by their not having replied to him. I cannot speak for the President of the Board of Trade because I am not responsible for that department. However, from time to time I come before your Lordships wearing a Treasury hat and I can assure the noble Lord that eventually the document reached the Treasury. I believe that it was lost somewhere in the postal services of the House of Commons. The noble Lord should not be too upset because my Christmas cards, which I ordered some time in November, arrived yesterday. I assure him that the two departments involved are studying the document most carefully. Indeed, they will soon begin to discuss the details of the proposals in the document, largely via the Registry of Friendly Societies, in order to allow us to come to a detailed conclusion. I shall return to the document and make a few comments about it.
The co-operatives have a valuable role to play in our modern economy. As I mentioned when I referred to the speech of the noble Lord, Lord Sewel, I appreciate their importance in many rural areas of the country where, for example, the village shop may no longer be the kind of economic proposition that would encourage someone to try to make a living out of it. We have heard examples of large and small co-operatives meeting a wide range of needs; for instance, social needs and economic needs. At the risk of going over some of the ground again, perhaps I may point to some excellent examples.
In many ways the biggest is the Co-operative Retail Society, which for many years has had considerable links with the party opposite. It is the biggest in the retail sector, which I suppose goes all the way down to many small shops. Indeed, I can think of at least one village pub which is a co-operative. The last time I visited it it appeared to be quite successful. Obviously it depends heavily on the owners taking a fair share of the space at the bar and a few visitors passing by. The noble Lord, Lord Graham of Edmonton, asked whether I got a dividend. I did not notice that drink was any cheaper in the co-operative but the surroundings were most pleasant—the geographical surroundings certainly were.
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Many organisations such as the Northern Clubs Federation Brewery, the Co-operative Press and even the Morning Star newspaper—I notice that no one on the Benches opposite mentioned that, and I am not surprised—are part of the co-operative movement. There is a wide range of co-operatives in agriculture and fisheries. There are co-operatives which provide goods and services to farmers and large co-operatives such as Milk Marque, the former Milk Marketing Board. There are also co-operatives such as the Rabbit Clearance Society and the like.
I know a little about the fishing societies from my former position as chairman of the Seafish Industry Authority. Up and down the country and in the ports there are co-operatives which supply gear and various equipment to the fishing industry. The largest society is the Shetland Salmon Group which has a turnover of £14 million. I hope that occasionally some of your Lordships help in the consumption of its product.
There are many other clubs. Indeed, I am surprised that the party opposite did not pull my leg by reminding me that the Association of Conservative Clubs is a co-operative, as indeed is Surrey County Cricket Club, and there are the credit unions, which play an important role in many parts of our country.
Most co-operatives in Great Britain chose to register under the Industrial and Provident Societies Act 1965. There are more than 11,000 industrial and provident societies. They have a total membership of 10 million and their assets are in excess of £30 billion. Retail societies provide services to almost 7 million members.
One of the important proposals made in the document referred to by the noble Lord, Lord Carter, and other noble Lords is that there should be new co-operatives' legislation. Noble Lords put the case for primary legislation for co-operatives. The UKCC has worked hard to produce a considered report as regards which new provisions would serve the societies that they represent. I understand fully the thinking behind that approach and I appreciate the amount of effort that has gone into formulating the report. However, as noble Lords will know, the Government have no proposals to introduce such primary legislation. But we shall consider very carefully indeed the contents of the council's proposals.
Perhaps I may address two particular issues that arise from the report. The first is the idea of a co-operatives commissioner. The UKCC has proposed the establishment of a co-operatives commissioner—originally as the head of a new statutory body but now, it seems, as someone who would continue to be served by the staff of the Registry of Friendly Societies. This commissioner would have one role supervising co-operative societies and another as the Government's chief source of advice on the sector.
It appears to the Government that the co-operatives sector already has such a figure in the Chief Registrar of Friendly Societies. The registry is itself a statutory body, with a registration and limited regulatory role

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which it exercises independently. It is also a department of government, advising my right honourable friend the Chancellor.
Since the UKCC published its proposals it has become clear that there is not a consensus within the sector on what new powers or responsibilities the commissioner should have. Until one has emerged it will be difficult for the Government to form a view on how to respond to the sector's concerns. For the moment, our attitude remains, "If it ain't broke, don't fix it".
Much has been made of the principle of mutuality in co-operatives. When people decide to set up a co-operative, or to join one, they have made a deliberate choice that this is the appropriate structure for the business they want to be in. Co-operatives are run for the mutual benefit of their members, who have a direct and equal say in decisions.
The UKCC has proposed making it possible for members setting up a co-operative to direct, in the society's rules, that the co-operative should never change its original, mutual form. This contrasts with current legislation which allows a society to convert into a company should 75 per cent. of members voting at a general meeting support such a change.
That is relevant to the regrets expressed by, for example, the noble Lords, Lord Carter, Lord Gallacher and Lord Sefton, regarding building societies and some of the "demutualisation" that has taken place. I believe that, as those changes can proceed under the law only if a substantial majority of members support them, that is mutuality—that people have reached a decision that they wish to change the form of a society. We are, of course, willing to consider detailed proposals for societies' constitutions, but there are difficulties in principle with allowing current members to limit so fundamentally the democratic rights of their successors.
There may be times when a co-operative structure, because of a changed local business climate or a reduction in the number of members, ceases to be the best option for meeting the needs of its members. In such a case a significant majority of members may consider that putting the business on a different footing is essential if it is to adapt effectively to the new environment.
In more extreme circumstances it may be that the natural life of an enterprise has expired. In these cases, the best course for the current members may be to wind up the co-operative before its business difficulties erode its asset base to the detriment of everyone involved. It would be most regrettable if the co-operative were bound by statute to continue into insolvency, so wiping out the worth it had built up over the years and to which current members had contributed.
Therefore, while the Government are willing to consider whether a co-operative might place limits on its eventual destiny, there are strong reasons for not trammelling unduly the freedom of current members. The rights of members is, after all, itself at the heart of mutuality. Future members, as much as present ones,
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should be free to exercise their democratic vote as the owners and ultimate custodians of the co-operative's identity.
But, although the Government have no plans for new primary legislation, much can be achieved by other means. The Deregulation and Contracting Out Act allows us to remove burdensome rules and regulations which stifle enterprise and initiative, provided we maintain necessary protection. We intend to make full use of this order-making power to improve the regulatory environment for co-operatives. Last year we completed a consultation exercise on proposed amendments to the Industrial and Provident Societies Acts 1965 and 1967. The measures will reduce the legislative burden on co-operatives registered under the 1965 Act, enabling them to make meaningful administrative savings. For example, the audit thresholds for non-deposit-taking societies will be raised in line with those for companies, easing the burden on societies with an annual turnover of less than £350,000.
The consultation period has been useful and constructive, and we will do what we can to accommodate the views of those who responded. We will announce our revised proposals when we bring a draft deregulation order before the House, which we intend to do shortly.
I know also that the comments of the UKCC and a number of organisations have been extremely helpful in formulating other proposals. Among the other proposals which have been suggested or supported by the co-operative movement is a proposal to reduce from seven to three the number of members needed to set up an industrial and provident society. We very much hope that that will be of assistance to the movement.
The noble Lord, Lord Rea, asked me about the scope for shared-profit community care schemes in a co-operative structure. One of the strengths of the Industrial and Provident Societies Act is its ability to encompass a wide variety of different types of organisations, as we have heard in all the speeches this evening. I do not wish to commit myself too far without checking, but I can see no reason why a number of people should not come together to do what the noble Lord suggests.
Secondly, he asked me whether such a body would be in a position to take payments under the Community Care (Direct Payments) Bill. The best person to ask may be my noble friend Lady Cumberlege during the next stage of the Bill. But I shall try to find out and write to the noble Lord with the answer to that question.
I believe that it was the noble Lord, Lord Gallacher, who urged encouragement of credit unions in order to facilitate their growth. Measures for the encouragement of the growth of the credit union movement are included in the draft Deregulation (Credit Unions) Order, which is another deregulation initiative. That was laid before the Parliamentary Deregulation Committee in July of last year and the committee reported on it in December last. That measure is expected to make further progress through the various deregulation procedures in the near future.

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I enjoyed many of the speeches. For a few moments, when the noble Baroness, Lady Nicol, mentioned Boston, I thought that she was going to claim that the Boston Tea Party had been a co-operative venture. But tea was not left out of the contribution of the noble Lord, Lord Taylor of Gryfe.
Lord Graham of Edmonton: He was stirring it!
Lord Mackay of Ardbrecknish: My Lords, the noble Lord must not accuse the noble Lord, Lord Taylor of Gryfe, of stirring. I would never accuse him of that. But I know that in addition to an illustrious career in both the public and private forestry sectors, the noble Lord, Lord Taylor, had his roots in the co-operative movement. I listened with great interest to what he had to say.
I intended to resist the temptation to join in some of the slightly more controversial points put by noble Lords opposite. However, those noble Lords who have had occasion to hear me perhaps will know that I am not very good at resisting those temptations. Your Lordships will he familiar with the game in which one sits down and writes down those words that come into one's mind when a word is heard. I played that game with the interesting word "stakeholders". The first word I thought of was "vampires". I wrote down "dinner", because my spellcheck was not on. I then wrote down "betting", "horses" and "lottery". I also wrote down "fencing". We do quite a lot of that both in this House and in the other place. I believe that in today's papers Mr. John Monks let the cat out of the bag when he said that one of the major stakeholders would be the TUC. That took me back—as the noble Lord, Lord Monkswell, had already taken me back—to 1978 and 1979 when we saw that particular stakeholder co-operate so successfully with the last Labour Government.
Baroness Dean of Thornton-le-Fylde: My Lords, I also heard that interview. My recollection is that the General Secretary did not claim that the TUC was a stakeholder but that individual employees of companies, who might also be trade union members, were stakeholders.
Lord Mackay of Ardbrecknish: My Lords, I did not hear the interview. I believe that I read a press report of it. The noble Baroness makes a fine distinction. I suspect that the TUC jolly well do believe that they are stakeholders. Of course, the real stakeholders are the people of this country. When I look back to the 1978 Parliament and the huge opposition of the party opposite to giving the people of this country the right to buy their own homes, and therefore to be stakeholders in a property-owning democracy, I wonder whether we do not have a Johnny-come-lately in this matter. I also have in mind the privatisations that the party opposite have opposed in every case. They always said at the time that they would be reversed, but now they will not reverse any of them, as I understand it. That extended shareholding to vast numbers of people, both directly and indirectly, through the major stakes which many people had in shares.
Baroness Seear: My Lords, would not "Tony come tardily" be better?
Lord Mackay of Ardbrecknish: My Lords, I am delighted that the noble Baroness has intervened to help me. The expression "Tony come tardily" will do very well indeed. If the noble Baroness had heard her noble friend Lord Rochester, he claimed that the whole idea was a Liberal idea which went back to the 1920s. I suspect that the parentage of this idea will be claimed by almost everybody by the time we are finished. Essentially, I believe it to be a neat buzz word.
Having not resisted the temptation to have a little knock about, I should like to conclude by thanking the noble Lord, Lord Carter, and other noble Lords for their interesting and valuable contributions to the debate. The co-operative sector in the United Kingdom is varied and thriving. Co-operative arrangements continue to appeal to all kinds of people with many different objectives. They provide a way of organising business for mutual benefit. The Government are committed to preserving and promoting an environment in which co-operatives can flourish and prosper. Through deregulation and all our other work, informed by the contributions of the UKCC and debates such as this, we aim to ensure that this friendly environment remains one that is fully alive to changing trends in our society and economy in which co-operatives and all United Kingdom businesses have to operate.
8.24 p.m.
Lord Carter: My Lords, I am extremely grateful to everybody who has spoken in the debate. We have had some excellent speeches, but none better than the maiden speech of my noble friend Lord Sewel. We all look forward to hearing from him on many occasions in the future.
I will not attempt to summarise the many strands of thought that have characterised a very good debate. I am a little disappointed that the Benches opposite have not provided a single speaker for the debate, other than the Minister, which is perhaps indicative of a failure to understand the importance of the co-operative movement. I am grateful to the Minister for his reply to the debate and his kind reference to my birthday, although I have reached the age where repeated references to the event are unnecessary. He had to have a go on stakeholders. I am delighted that the Tory Party is now debating our agenda. I believe that the matter can be summarised in a few words. The party opposite see it only in terms of the ownership of property, whereas we see it in terms of the community.
This is not the place to deal in detail with the Government's response to proposals for a co-operatives Act, but the Minister is correct that discussions are planned with the Registry of Friendly Societies, who have been extremely helpful in the matter. I repeat my thanks to all who have spoken in the debate, and beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

Road Traffic (Amendment) Bill [H.L.]
8.26 p.m.
The Earl of Kinnoull: My Lords, I beg to move that this Bill be now read a. second time.
In introducing this Bill to ban bull bars from our roads, I think it is worth briefly recalling their origin. They originated in Australia in the form of 'roo bars to protect vehicles against kangaroos, which were a genuine hazard, just as cow-catchers were fitted to trains in mid-America 100 years ago. The same genuine reason cannot be ascribed to bull bars in Britain. We have no need to brush mad bulls or cows from our motorways; nor are they seen in leafy Fulham. Their occasional use in some distant farm or forest was never the purpose in the minds of the manufacturers. They were seen as a clever fashion accessory—perhaps as a form of body language or to give vehicles a macho image. In the early 1990s they proved to have enormous appeal, coupled with four-wheel drive vehicles. By last year the number of such private licensed vehicles was over 500,000. That figure did not include many transit vans.
This has become fashion design with a vengeance. Not only are bull bars without doubt a dangerous menace to pedestrians and cyclists on our roads, but in a perverse way the Government Research Establishment (TRL) has concluded that they are a hazard to the occupants of vehicles. Often, the very fitment of bull bars markedly reduces the safety design of the vehicle; that is, the crumple zone.
The Bill has not come out of the blue. There has been an active campaign to rid bull bars from our roads for over three years. They have caused many fatalities and serious injuries. One accident that I believe caught the public conscience occurred six months ago. It involved the tragic death of a 10 year-old girl. Both the surgeon who tried desperately to save her and the coroner came to the same view and publicly called for a legal ban. Perhaps when the law changes and bull bars become illegal her family will have some comfort that her innocent death has led to a change that may save others.
I believe that public awareness of the dangers of bull bars over the past three years has been immeasurably helped by both the honourable Member for Newport West, Mr. Paul Flynn, and the RAC. The skilful stream of debates and Questions put down by that honourable Member and his commitment is a demonstration of parliamentary skill at its best. I salute him. Equally, the RAC has fired up all kinds of responsible organisations and carried with them their 6 million members. Their efforts were particularly valuable in lobbying the European Parliament, which formally backed a motion in support of a ban.
One motor insurance company has bravely decided not to insure any vehicle with bull bars. I wish that others would follow suit because then there would be no need for legislation. That company has conducted a survey which was published today. Ninety-six per cent. of the motorists to whom they wrote supported a ban. There is a long list of influential bodies which support the ban, including of course the police forces and
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ambulance services which are at the sharp end. In fact, it is difficult to find who is against the ban, except, naturally, the manufacturers of the accessories. I hope that they realise by now that the product has no future.
If one looks beyond Britain, it is interesting to note that, in Australia, bull bars arc in the process of being banned from urban areas. In future, if the owners of such vehicles wish to visit a town, they must first remove their bars before entering the area. These demountable bars are a new design. Perhaps one should follow suit as regards that excellent example.
One might ask: what have the Government been doing over the past three years? Without wishing to trespass on my noble friend's reply, I believe that a fair summary would be that they have been researching the facts with the help of the TRL and the police forces which were asked to monitor the accidents. The TRL has publicly stated that its best estimate is that something like 35 deaths per year and 350 serious injuries are caused directly by bull bars. I am sure that my noble friend agrees that no further dry statistics arc necessary. Common sense tells us vvhat to do. The Government have also been examining ways of imposing a legal ban with the Commission to amend Directive 74/483 by a shortened procedure known, as I understand it, as the "technical adaption". That would effectively meet the objective.
There is another point which is most important to me. My honourable friend the Minister has publicly committed his determination to see that bull bars are banned. That is a most encouraging advance, because I have a high regard for his political skill and, indeed, his sincerity on the issue. But I am unhappy and disturbed that the advice he is receiving is, "Leave it to the Commission".
The Commission, with all its wisdom, cannot commit other member states. Who knows, in 12 months' time, we may find that the issue is still in the slow lane and unresolved with more promises and more deaths and injuries. To give the Commission its due, it has recommended three courses of action that Britain could take unilaterally. First, there is the temporary ban for six months, although whether it can be renewed after that period if the Commission has not brought in its amendment, I know not. Secondly, one could ban the bull bars that are not type approved, but, of course, that applies to only a small percentage of the market. Thirdly, one could play the safeguard card. Where there is determination, I have no doubt that lawyers will find a way. Of course, there is no room for timidity. Safeguard cards look to be the most promising option.
I turn now to the Bill. It is very simple in concept. It simply adds bull bars to a long list of permissive powers under Section 41(1) of the Road Traffic Act 1988. It is an illustrative list, not exclusive. It spells out specifically without peradventure the power to ban bull bars. Although there may be a general power under that section of the Act, I commend the Bill as a piece of vital and overdue legislation which, perhaps, has as an added benefit its simplicity and clarity.
Moved, That the Bill be now read a second time.—(The Earl of Kinnoull.)
8.33 p.m.
Viscount Simon: My Lords, I am delighted that the noble Earl, Lord Kinnoull, has introduced this important Bill. Some may not see it as being important, yet road vehicles affect all of us and we are all, therefore, subject to the way in which they are driven and constructed. There are a number of angles concerning bull bars which need to be looked at, but I shall confine my comments to safety. I should add that, having lived in Australia in the 1960s, I have in fact seen the result of a vehicle having been in collision with a kangaroo. It was not a good sight to see.
Bull bars have spread to vehicles which will never need them. Confining bull bars to, perhaps, farm vehicles and police riot vehicles may be acceptable. But when they are used purely for cosmetic and macho reasons on vehicles which do not need them, it is not acceptable. A few people say that they have bull bars to protect their lights, unaware, I assume, that contoured plastic covers are available. They are very good and I have used them for some years.
Bull bars are dangerous to children, pedestrians, cyclists, motorcyclists and to other vehicles to the extent that 87 per cent. of motorists, questioned in a survey by Auto Express and RoSPA, said that they should be banned. Research done in this country, in Germany, in New Zealand and in Australia concludes that bull bars turn slight injury accidents into serious ones, and serious accidents into fatalities. Not one researcher, interestingly, concluded that they add anything to safety. A TRL report states that,
"the potential to improve energy absorbing characteristics of crash bars made from bent and welded tubes is very limited due to their high mass and inertia".
While some people are trying to design pedestrian friendly bull bars, it has already been shown that even a soft one fitted to a vehicle is more dangerous than where none is involved. Much development has taken place in recent years to ensure that the fronts of cars crumple progressively in an accident. In another place on 19th April 1995, Mr. Peter Bottomley asked:
"Can my hon. Friend also tell us why, although cars are usually constructed so that they collapse to protect those inside, idiots put hard objects on cars that will kill those outside?".—[Official Report, Commons, 19/4/95; co1.190.]
I heartily agree with him. The front of vans, off-road vehicles and people carriers are unfriendly enough without adding what I tend to think of as either a cheese or egg slicer, a potentially lethal weapon for protection.
One driver interviewed by Auto Express said:
"In a van like this, with nothing between you and the traffic, keeping them on is a question of self-preservation".
I am sure that that attitude sums up the opinion of many drivers who have them fitted. They do not realise that the fitting of bull bars not only effectively eliminates the crumple zone but also stiffens the vehicle which means that, in an accident, there is faster deceleration, thereby causing more severe injury than in one not so equipped. Further, any other vehicle involved will have to absorb up to twice the energy that it was designed for, with the result that damage is worse. So bull bars are thoroughly dangerous on the public highway.
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I seem to recall a newspaper report saying that France and Germany will not, in all probability, be banning bull bars: I may he wrong. While the figures that I have been given by RoSPA for pedestrian deaths are very similar for each country, those for road deaths give 6.8 deaths per 100,000 population in the United Kingdom, 17 for France and 12 for Germany. This, perhaps, could indicate that we take road safety seriously and heed advice given. Perhaps France and Germany should follow us with the elimination of bull bars. It is unfortunate, though, that the figures for pedestrians do not separate bull bar fatalities: perhaps another noble Lord has managed to do so.
Bull bars should be banned and should be removed from road-going vehicles which already have them fitted—as some people, companies and police forces, have already done. I support the Bill.
8.37 p.m.
Lord Astor of Hever: My Lords, I should, first, declare an interest as deputy president of the Royal Society for the Prevention of Accidents. The society has been leading road safety campaigns for nearly 80 years and has been at the forefront of the movement to end the fitting of metal bull bars to road-going motor vehicles. I support the Bill and commend my noble friend for introducing it.
My concern is that vehicles fitted with bull bars inflict serious injuries on the most vulnerable road users—pedestrians, pedal cyclists and motor cyclists—when they are involved in accidents. Bull bars stay rigid and do not crumple on impact like bumpers. People are being killed or badly hurt because motorists have been encouraged to drive in vehicles fitted with equipment which is totally unnecessary and inappropriate to their use.
The sad thing about this fashion—for that is what it is—is that it flies in the face of well-known good practice in the motor industry. A great deal of research, time and money have been expended to identify the aspects of design which can help to minimise injury, yet for the sake of a chance to develop a fashionable sales gimmick some within the industry appear to have been happy to close their eyes to known good practice.
As my noble friend said, bull bars were introduced to protect a vehicle's bodywork in off-road situations in Australia as a defence against collision damage from kangaroos which were mainly attracted by headlights. I am not aware of kangaroos roaming the roads of Britain, but this is a serious point and vehicles should not be allowed on our roads fitted with bars that can kill or maim if those bars serve no purpose. They are most commonly fitted to four-wheel drive vehicles and vans. The bars are often at the head height of a child and the vulnerable abdominal area of many adults. A child's life is a high price to pay for the sake of fashion. Research supports my arguments. As my noble friend said, the presence of bull bars is estimated by the Transport Research Laboratory to result in 35 deaths, including 15 child deaths, and 350 serious injuries to vulnerable road users each year.

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Studies in Germany indicate that whereas most children would survive an impact with a vehicle at 20 miles an hour, life threatening injuries are sustained at just 12 miles an hour when bull bars are fitted. Those are shocking figures and such bare statistics do not of course show the pain of the victims and the grief and misery of their families. That pain and misery could be ended if we could remove the threat of bull bars on our roads. I believe steps must be taken to stop manufacturers fitting metal bull bars to new road-going vehicles. In addition the public must also be prevented from buying and fitting them after manufacture. Finally, motorists with vehicles already equipped with bull bars should be required to have them removed.
The only exceptions which I believe could be justified are for vehicles used entirely off-road and which clearly need the protection of bull bars from rough terrain and animals. Manufacturers who are well aware of the risks of such designs should be looking at ways of making their vehicles more pedestrian friendly. In that way they will he helping to reduce the carnage on our roads—something with which everyone should be concerned.
As the noble Viscount, Lord Simon, said, there have been reports recently of resistance in France and Germany to moves to outlaw bull bars. I urge this House to do everything in its power to persuade such opponents to think again so that legislation banning bull bars can be introduced speedily throughout Europe. After all, ceasing to fit bull bars should not increase the cost of vehicles. In the meantime I urge motor manufacturers to make a positive move for safety by voluntarily ceasing to fit these bull bars to their vehicles. Individuals should also play their part in making our roads safer by having these potentially lethal bars removed from their vehicles now.
8.44 p.m.
Earl Attlee: My Lords, I thank the noble Earl for introducing this Bill. When I first saw the Bill I had a quick look at it and went straight to the Long Title to see whether it could be a good vehicle for dealing with other problems such as the impounding of goods vehicles. Unfortunately, the Long Title was so well written that the only matter the Bill could address was the problem of bull bars.
Most speakers have discussed this problem in great detail. I am convinced that there is a problem. Bull bars are not good accessories to fit to vehicles. I believe that in any legislation there will be a problem in defining what exactly is a bull bar. The noble Earl mentioned difficulties as regards loopholes. There will be a problem as regards covering the need for light guards. All speakers referred to the bad design of vehicles which results in those vehicles becoming deformed as a result of an accident. I support those sentiments.
I believe that many speakers have underestimated the necessity of avoiding damage to vehicles which genuinely have to travel cross-country and go down difficult tracks. Much damage is sustained to the lights and bodywork of those vehicles. The solution to that is a detachable bull bar or light guard, or whatever one wants to call it, that can be fitted in certain
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circumstances in the country but which cannot be used when the vehicle is in town. If we decide to adopt a construction and use regulation I fear that we may still have problems as regards vehicles that originate from and are registered in Europe. We may not he able to prevent them from entering this country.
Another problem concerns EU approval. If a bull bar is type-approved in Europe, can we prohibit their use on vehicles here? Bull bars arc fitted to off-road recreational vehicles. It is worth considering what they are used for. They are used for sport vehicles. People drive down rough tracks in these vehicles and that is enjoyable. However, unfortunately, those vehicles are causing much damage to ancient tracks in the country. Perhaps at some stage we need to consider that matter too. Perhaps we need to build suitable adult playgrounds. In conclusion, I would say that the Bill addresses an important problem. I support the objectives of the Bill. However, I am not sure that the Bill will he quite the right way of addressing this matter and I look forward to hearing how the noble Viscount intends to address the problem.
8.48 p.m.
Baroness Thomas of Walliswood: My Lords, I am grateful to the noble Lord, Lord Clinton-Davis, for allowing me to speak before him, and also to everyone else who has enabled me to do so. I shall speak briefly. We all now know—if we did not before—of the problems of bull bars. The three tragic cases of the 10 year-old Helen Baggs, of the pensioner Ivy Hamnett and of the 17 year-old Victoria Moull, who received severe injuries, indicate exactly how bull bars function. If the straight part of a bull bar hits one, it inflicts appalling damages, wherever it hits one. If one is six years old, bull bars hit one's head, and if one is 10 years old—as in the case of Helen Baggs—they hit one in the chest. As people grow taller they are hit in the pelvic area and on the legs. However, wherever bull bars make contact, they cause horrendous damage. When I was researching this matter someone told me that if a bull bar was thrown at me it would break my legs. It is the rigidity of the bar itself that does the damage.
I support absolutely the extremely good work which is being done by RoSPA and many other organisations to bring this matter to the attention of the public. I believe, as do others, that bull bars have been treated in a rather lighthearted fashion as amusing accessories. Because statistics are not kept on the number of accidents caused by bull bars, it has been difficult to bring the matter into the public eye. Therefore this debate and the work of RoSPA and of motoring and other organisations is extremely useful in that respect.
The TRL has been involved in the creation of tests and test tools required to implement a new directive to improve the safety of cars which may come in contact with pedestrians, particularly when that involves frontal contact. The results of its work support the findings that these bull bars are extremely dangerous, even when vehicles are driven at low speed. I support the objective of the noble Earl. However, I am worried as to how he thinks that the Bill will fit into the European context.

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We have already had reference to vehicle type approval, and so on. I have my doubts as to whether he can achieve what he seeks.
Meanwhile there are some actions that people can take. Local authorities, for example Kent, Hampshire and Surrey, have already reduced or forbidden the use of the bull bars except where vehicles go across country. I believe that RoSPA and motoring organisations are doing an excellent job in seeking to persuade motorists to remove the bull bars already on their vehicles, and not to fit bull bars or to buy new vehicles with them. However, the noble Earl must explain how he sees the Bill fitting in with European matters.
8.50 p.m.
Lord Clinton-Davis: My Lords, perhaps I may say that in winding up from this side, I do so in a personal capacity. I do not speak for the Labour Party. However, speaking for myself, I congratulate the noble Earl on introducing the Bill, and pursuing a campaign. I thank him for offering the generous tribute to my honourable friend Mr. Paul Flynn in another place. Certainly the two of them have worked in a helpful combination, and hopefully their endeavours will elicit a positive response tonight from the Minister.
I thought that the valuable intervention of the noble Baroness, Lady Thomas of Walliswood, was characteristically useful. I would underline the fact that she now "owes me one". In what capacity she will honour the obligation I do not know.
I believe that an overwhelming case has been made for action on the part of the Government, independently of action that might be taken at European Union level. I concede that that would be the best solution but I fear that it will take rather a long time. I shall come to that in a moment.
In articulating his case, the noble Earl brought in aid, quite rightly, the work of the RAC. The noble Lord, Lord Astor of Hever, referred to the support which RoSPA gives to the proposals. In all fairness, it is right also to pay tribute to another authoritative organisation, the Parliamentary Advisory Committee on Transport Safety (better known as PACTS), and the Automobile Association and the Transport Research Laboratory—about which, I gather, we may be hearing something positive tomorrow. All have expressed real concern about vehicles equipped with bull bars essentially, I think, to provide a rather cosmetic, perhaps macho, form of self indulgence, but which also constitute a real danger to other road users, as has been explained in the debate.
I do not know what useful purpose bull bars serve in our towns and cities. Not too many kangaroos are observed, as the noble Lord said. There are not a lot of cattle in Hackney, so far as I see. When I was a boy, cows were used by a dairy at Clapton Common. However, I did not see any bull bars in operation at that stage! Whether or not they apply to cows is a moot point.
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Very little has been said about the background in terms of the European Union's legislation. A Framework Directive (74/4/483 EEC) sets out the requirements for external projections of motor vehicles; and there are a number of European Union directives based on the Framework Directive dealing with the type approval of motor vehicles.
A relevant directive bans sharp edges on the exterior of vehicles and "ornaments". It requires,
"the external surface of vehicles not to exhibit or direct outwards any pointed or sharp edges or any projections of such shape, dimensions, directions or hardness as to be likely to increase the risk of seriousness of bodily injury to a person hit by the external surface or brushing against it in the event of a collision".
This question arises. If there is compelling evidence that the application of bull bars to vehicles constitutes a hazard to pedestrians or other road users, are the Government entitled to take unilateral legislative action to deal with the situation? It does not matter whether it is in the form of this Bill or the construction and use regulations. It is legislation. Alternatively, should the Government leave the issue to the development of legislation within the European Union?
When the issue was first promoted, it seemed that the Government were sheltering entirely behind the assertion that they were impotent to do anything about the problem: that they had to leave it to the European Union to deal with the situation. With respect, I do not believe that that view is entirely accurate by any manner of means. First, where bull bars are not fitted when the vehicle was originally type-approved, as an after-market extra, or where the bull bars in question are different from those fitted at type approval, then an individual member state can undoubtedly ban them. That is what the Commission stated. Commissioner Kinnock made that clear; and it is obviously the view of Commissioner Bangemann. I submit that bull bars can also be prohibited, albeit for only six months—that is, on a temporary basis—pursuant to the "safeguard" clause in the framework directive which allows member states to refuse registration or sale of vehicles type-approved with bull bars where there is a legitimate concern over safety.
In many respects the most important provision is under Article 36 of the treaty. I shall not go through it now. It is clear that the application of Article 36 is available. The member state could outlaw the fitting of bull bars on vehicles with national type approval where, and only where, the bull bars comply with national requirements rather than the European Union directive on external projections. Of course, the provision must not be used as a form of arbitrary discrimination. It must not be used as an artificial barrier to trade. That is set out in Article 36.
One must ask the Government—I hope that the Minister will reply—about the possibility of further European Union legislation on the issue. It is right and fair to say that the Commission has paid tribute to the Government. It supports the Government in their commitment to make vehicles "pedestrian friendly", to use a term utilised by the Minister at Question time last

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June, if I recall aright. It is a term which he did not regard as particularly happy. Nevertheless, let us assume that we all understand what it means.
The Commission has drafted a directive to amend the provisions relating to sharp edges to include hard surfaces. I believe that that would include bull bars. I do not agree altogether with the criticism made by the noble Earl, Lord Attlee. I believe that bull bars, as we understand them, would be caught by the new proposals. Unhappily, there appears not to be a qualified majority for the proposal to be written into international law, although the Commission has said that it is convinced, like all the other non-governmental organisations, that it is essential for the safety of vehicles and for pedestrians. So the Commission requires no further commitment in that regard and it proposes to pursue the issue vigorously. I am delighted to know that.
Like all the other organisations the Commission clearly understands and is convinced that it is a safety problem which needs to be tackled. It does not seem to me to require the reassurance, therefore, of the further investigation that we know the Government have undertaken. I said that last June and I was rebuked by the Minister in, as always, the friendliest possible way. But I do not understand why we need all the extra research into a problem which is self-evidently serious. It may not be on the scale of all the problems of road accidents, but it only needs a few children, as in the cases cited by the noble Baroness and the noble Earl in introducing the Bill, to convince me that the tragedy that befalls not only the victim but also the relatives is such that the issue ought to be met urgently. I hope that the Minister will accept that there is a strong, convincing case for adopting the legislation.
Perhaps I may ask the Minister this. If he says that he would still rather see it applied on a European Union scale, what prospect does he have that the Commission's proposal will be adopted within a reasonable time? I fear that it will not, but the Minister may give evidence to the contrary to the House. I believe that the case for the Bill is substantial but the Minister ought also to make plain whether he accepts the case factually and statistically. Alternatively, do we have to wait for the end of the period of research? When will the research come to an end?
In answer to a Question posed last June by the noble Earl, the Minister said that the report would be published at the end of last year. We have reached that time and I wish the Minister a very happy new year. However, when shall we have a happy report? This month, next month, the month after? Will he explain to the House when it will happen? We ought not to wait so long. I believe that the case for unilateral action of one kind or another is made out. I do not propose to go over the evidence adduced by the Transport Research Laboratory, which, in my view, is utterly compelling.
The Government place their faith in other matters as well. They say that voluntary action would render a mandatory approach unnecessary. I believe that there is something in that. For example, some effective response has been elicited from manufacturers to the anxieties about safety with the introduction of softer metals as
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a substitute for aggressive metal bull bars. That is an encouraging response. I am also pleased that the insurance company, CGA Direct Line Insurance, has responded in an effective way, as the noble Earl pointed out at the beginning of his speech. It did not need any additional evidence to convince that company that that was an appropriate line to take. The problem is that, if it turns down an insurance, it is possible that the person involved will move to another insurer, albeit paying an additional premium for the privilege, and that will not solve the problem.
I ask the Minister what evidence there is that other insurers are prepared to fall in line with the perfectly sensible initiative taken by CGA. Is there any truth in the suggestion that, if the company takes that action, it will expose itself to litigation, as has been reported in the press?
By amending the Road Traffic Act 1988, the Bill would enable the Secretary of State to make regulations prohibiting the use on the road of vehicles fitted with bull bars. It may be, as the RAC has advised, that a better route would be to amend the Construction and Use Regulations of 1986. One needs to examine that position, and perhaps the noble Earl will do that at Committee stage when he has reflected on the matter. I hope that the Bill will receive a Second Reading tonight.
However, if—contrary to my expectations—the Commission's proposal makes progress in the near future, then the Secretary of State would not he required to take action under the enabling Bill. That is the essence of the matter. It would not prejudice the position of the Secretary of State in the least, indeed, it would strengthen it in negotiations in the Transport Council. I speak from experience in this regard: often a commissioner can be enormously assisted by national proposals, either in embryonic or enabling form, which are adduced within national parliaments and which have the support of the parliament. I do not believe that the Minister would be in the least prejudiced by that. No harm would be done.
Equally, if the permissive actions which the Government have encouraged with some success with manufacturers and insurers are not so successful as the Government hope, the Minister would be armed with the potential to take real and decisive action.
I welcome the Bill which has been eloquently moved by the noble Earl. I thank him for doing so, I have supported him in the campaign. I wish him well and hope that the Bill receives a fair wind.
9.5 p.m.
The Parliamentary Under-Secretary of State, Department of Transport (Viscount Goschen): My Lords, I welcome the fact that my noble friend Lord Kinnoull has raised the profile of this important road safety issue and I commend his motives in bringing the Bill forward. We have had a good discussion around road safety issues involving bull bars this evening and there seems to have been a consensus in the House on the dangers arising from the use of those devices.

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The Government are committed to improving all aspects of road and vehicle safety to reduce the toll of deaths and injuries on our roads. We have been concerned for some time that the fitment of bull bars might hinder this objective, particularly in the case mentioned by my noble friend Lord Astor of the especially vulnerable categories of road users: pedestrians, cyclists and motor cyclists.
Bull bars have been an increasing trend over the past few years. It is true that some can be quite crude in nature and design. It seems to be the case that many are fitted simply as macho fashion accessories, with little worth-while benefits to the vehicles while being driven on the road. On the other hand, some are fitted by people who feel that they have a proper use for them.
Previous reports by the Transport Research Laboratory had estimated that an extra 35 deaths per annum could occur as a result of bull bars. That was not based on actual accidents but on predictions on testing. We have taken steps, in conjunction with the police, to try to quantify this by examining accident reports for vehicles fitted with bull bars. I have to say to the noble Lord, Lord Clinton-Davis, that, despite my aspiration earlier last year that the work would be finished by this time, I am afraid we must wait a little longer for the results of the exercise. I anticipate that they will be available soon. I regret that I cannot be any more specific at the moment.
Preventing the use of bull bars on all vehicles would be difficult to achieve at the present time. Popular models with bull bars fitted as original equipment by the manufacturers are likely to have been granted European type approval in respect of external projections. The free circulation of such vehicles cannot be impeded. That point was taken up by the noble Earl, Lord Attlee, and the noble Baroness, Lady Thomas.
The external projections directive was agreed in 1974, and simply calls for projections at the front of a car to be rounded to a radius of at least 2.5 millimetres. Bull bar designs meet, or could readily be modified to meet, that requirement. But they would still be unsatisfactory in safety terms.
Such European considerations, and the fact that as yet there is no specific hard evidence as to the effect of bull bars on injuries to people, are partly why we have held back from proposing national action. We hope that when we have the results of the work that has been undertaken, we shall be in a much better position to judge the issues empirically.
The important point in considering my noble friend's Bill this evening is that it will not add to the national powers that already exist in legislation. And it would not resolve the complications that we have in relation to European law. As I suggested, the Government take the view that the only effective way of dealing with the bull bar issue lies with European action. Mr. Neil Kinnock, the Transport Commissioner, recently met my honourable friend the Minister for local transport and road safety, Mr. Steven Norris. The commissioner agreed that the best way forward in the short-term is for
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the Commission to bring forward an amendment to the external projections directive to introduce specific proposals on bull bars.
The initiative now rests with the Commission, and the Government will be urging it to announce its plans as soon as possible. If necessary, we may draft an initial proposal so that the matter can he speedily discussed.
This short-term action does not affect the Government's strong support for action on a proposed European directive to improve the pedestrian protection offered by all car fronts—
The Earl of Kinnoull: My Lords, my noble friend just said that his department might draft a proposal for the Commission. Is that in the process of being done at the moment and, if so, how soon will it be available to the Commission? It would be very helpful to the Commission.
Viscount Goschen: My Lords, the point that I was trying to make is that we have offered our help because of work done within the United Kingdom. I trust that if the Commission feels that in gaining our assistance the process would be speeded up, then we should be very pleased to help in so far as we can.
Returning to the issue of the pedestrian protection effected by all car fronts, a lot of work has been done in this field. The proposed European directive to improve pedestrian protection, as I mentioned, would prohibit the fitting of aggressive bull bars but is a broader issue that will take much longer to agree with our European partners.
The aggressive nature of car fronts is more of a danger than bull bars. Some 1,200 pedestrians per annum are killed in the UK. That is more than the number of car driver fatalities. A large proportion are struck by the front face of cars. We should not lose sight of the magnitude of this wider problem. Research has established that a significant reduction in such casualties could be achieved by cars having softer fronts.
Not all bull bars need be dangerous. Bars designed to use soft materials could actually make a vehicle safer while still offering some protection to its bodywork and lights from parking damage. A few manufacturers are experimenting with softer versions in order to help meet the proposals for making all car fronts pedestrian friendly. It is the hard, rigid and aggressive steel bull bars so well explained and described by the noble Baroness about which we are concerned.
We understand and sympathise with the reasons behind my noble friend's motives but, as I said, the Bill will not add to the powers that we already have. The field of vehicle legislation is occupied by European directives. The Bill will not change that fact.
Lord Clinton-Davis: My Lords, I am obliged to the Minister for giving way. What the Minister seems to argue is, in a way, contradictory. First, he mentioned the scale of the problem in general, which is quite true, and this legislation falls into a very small sector. However, it seems to me that, although one cannot achieve everything that one wants, one nonetheless does something. There is no reason for not doing something.

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This is a situation in which the Minister has the powers. Therefore, if he has the powers, why not be prepared to adopt them on the basis that there is no likelihood of early agreement within the European Union (notwithstanding the offer of help that he has given, I believe that the Commission could probably do the job itself). In fact, why not say very clearly that, if we are not satisfied that the situation will be resolved within the European Union within the course of the next 12 months, we shall have no hesitation in utilising the legislative powers that the Minister says are available.
Viscount Goschen: My Lords, I feel that the noble Lord has slightly though not entirely misunderstood the message that I was trying to put over. On the European front there are two strings to this bow. One is the broader approach to softer car fronts. That is very much the longer term objective. I believe that there will be considerable benefits from making good progress on that but we are some way off that. The other approach on the European basis, as agreed by Mr. Kinnock, is for the Commission to bring forward an amendment to the external projections directive. That is a separate measure from the general measure concerning softer car fronts. That could be achieved very much more quickly.
Why do we not take unilateral action? I have explained that in a field that is so heavily governed by European directives on type approval, we feel that we would be in a position where we could very well be challenged in the courts because of the considerable body of legislation on type approval. That, and for the reason that I have given of ongoing research, is why we consider that getting speedy European action is very much more satisfactory and legally defensible than taking the national action that is proposed. Also, in terms of the national action available to us, the Bill does not add anything to the powers that we already have.
In conclusion, we believe that the path forward to achieve some proper progress on this issue is through European action. As I said, we are urging the Commission to announce its proposals for amending the
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external projections directive. Once finalised, they will remove a significant obstacle to national action on bull bars.
9.17 p.m.
The Earl of Kinnoull: My Lords, I thank all noble Lords who have taken part in this debate. There was unanimous support for the Bill, except, sadly, for my noble friend who, towards the end of his speech in reply, seemed to emphasise that the Government already have the power and therefore there was no purpose in the Bill going forward. I disagree for the reason that the core issue is to ban bull bars. If we have a Committee, we can again examine the issues and press for further information.
I believe that there is a will and determination not only in Parliament but outside it to ensure that bull bars are banned. My honourable friend the Minister is publicly committed to banning the bull bars. I cannot believe that he would just allow this issue to drift on. That is what may happen. He said to many Members in a recent speech that he would he prepared to examine any way in which the Government could go forward. Allowing this Bill to go through is, I suggest, a very good way forward.
It is late at night. I shall resist the temptation to answer any of the detailed points that have been made. I am extremely grateful to all those who have spoken and to the noble Baroness for her late entry. I was not quite sure whether or not the reference made by the noble Lord, Lord Clinton-Davis, to "she owes me one" was part of the bull bar structure. However, I am very grateful to all noble Lords. It has been a valuable debate on a vital subject. I hope that the House will accept that the Bill should he read a second time. I commend it to the House.
On Question, Bill read a second time, and committed to a Committee of the Whole House.
House adjourned at nineteen minutes past nine o'clock.