Lords Sitting of 7 May 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 Exeter.
The Duke of Wellington—Took the Oath.

Former Yugoslavia: Tribunal
Lord Avebury Lord Avebury asked Her Majesty's Government:
What agency they consider should be responsible for protecting investigators working for the tribunal on the former Yugoslavia, the clearance of mines from areas being investigated, the prevention of attempted tampering with forensic evidence including suspected mass graves, and the arrest and detention of alleged offenders.
The Minister of State, Foreign and Commonwealth Office (Baroness Chalker of Wallasey): My Lords, the NATO-led implementation force is providing a secure environment in which the tribunal can work. IFOR supervises the clearance of mines prior to the arrival of a tribunal investigation team. IFOR is providing aerial reconnaissance and foot patrols of suspected mass grave sites and will report any attempts to tamper with the graves to the tribunal. The tribunal has confirmed it will prosecute those wilfully destroying evidence of complicity.
Lord Avebury: My Lords, is the Minister aware that the extension of IFOR' s terms of reference to cover these matters is most welcome? However, has she noted that Mr. Dusko Tadic today becomes the first person to go on trial for crimes against humanity since Nuremberg? Is this not rather as if Nuremberg had started without Goering or Ribbentrop being present? Does she agree with the comments of Senator George Mitchell that the single
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most important step to be taken towards achieving Dayton's aspirations is now the immediate apprehension of alleged war criminals? What steps will IFOR or the United Nations take to see that Mladic and Karadzic are brought to trial and that they do not remain in positions of power and influence within the Serb entity?
Baroness Chalker of Wallasey: My Lords, the answer to the noble Lord's first question is yes. Of course we have all noted the first name to come before the tribunal today. So far as Mladic and Karadzic are concerned, it is very important that if there is evidence against them they will be brought before the tribunal. It is the responsibility of all states to arrest any individual indicted by the tribunal. That has been made absolutely clear to all those who might have contact with Mladic and Karadzic. IFOR will arrest and transfer to the tribunal any indicted persons whom it encounters. But I put the very points that the noble Lord is making to Bosnian Serbs last week and I have no doubt that I shall be doing the same tomorrow in Banja Luka.
Lord Renfrew of Kaimsthorn: My Lords, can my noble friend confirm that at the time of the terrible massacres of the Moslem inhabitants of Srebrenica that city was a safe haven under the supposed protection of the United Nations? This is a matter which weighs heavily on many of us. I wonder whether she has any information about possible progress in bringing the perpetrators of those terrible atrocities to book?
Baroness Chalker of Wallasey: My Lords, we were all aware that Srebrenica was termed a safe haven. But my noble friend may recall that at the time I expressed in this House and on platforms very grave doubts as to whether Srebrenica could actually be a safe haven given its location and given the disposition of forces at that time. Of course those who may have perished in Srebrenica by the hand of others need to be found, but my noble friend will recall that this area of the world has had a very cold winter, the ground has been rock solid and it is an area where the water table is extremely high, which has made investigation difficult up to now. We hope that investigations which take place may bring

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at least some success and some peace in knowing what has happened to the many, many missing persons in the area of Srebrenica.
Baroness Blackstone: My Lords, does the Minister agree with the UN appointed prosecutor, Judge Richard Goldstone, that unless more of the indicted war criminals are arrested and brought to justice the peace process will be threatened? It will do so because without justice there will be yet more cries for vengeance. Can she reassure the House that if more of these war criminals are not arrested the Government will take steps to persuade the international community to take further action beyond what she has described today?
Baroness Chalker of Wallasey: My Lords, I can tell the noble Baroness that I agree with Judge Goldstone. Indictments against 57 individuals have already been announced. Of those 43 are Serbs, eight are Croats, three are Bosnians and three are of unknown ethnicity. I understand that two more Moslems have been arrested in recent days. That brings the Bosnian Moslem community in full compliance with the Dayton agreement. I willingly assure the noble Baroness that the Government will press for more to be done, but steady progress is now being made. We shall do all we can to help in this matter. I am glad to say that Judge Goldstone is very satisfied with the level of IFOR co-operation.
Lord Avebury: My Lords, did the noble Baroness say that she will be in Banja Luka tomorrow? If so, can she say what the responsibilities of the British forces would be in the Serb entity if their attention was drawn to the presence of either Mladic or Karadzic? Would they be charged with the duty of apprehending those persons and handing them over to the prosecutor? If not, how does she imagine that the Bosnian Serb entity can be persuaded to comply with the Dayton accords in good time for the elections in September, which obviously cannot be held while those two gentlemen occupy positions of power in the Serb entity?
Baroness Chalker of Wallasey: My Lords, indeed I shall be in Banja Luka tomorrow. All mandated IFOR troops are required to arrest and transfer to the tribunal any indicted person whom they encounter. That is exactly what troops of any nationality serving with IFOR will do.

Torture Weapons
2.45 p.m.
Lord Jenkins of Putney Lord Jenkins of Putney asked Her Majesty's Government:
Whether torture weapons are still being manufactured in and exported from this country in spite of the exposure of the trade on television and in the Press and, if so, whether this trade is carried out under licence.
Baroness Miller of Hendon: My Lords, the Government are not aware of torture weapons being manufactured in the United Kingdom. An export licence
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would be refused for the export of any weapons intended for such purposes. The United Kingdom is a party to the United Nations convention against torture. The Government deplore the use of torture and would never knowingly support the export of equipment for such purposes.
Lord Jenkins of Putney: My Lords, I am grateful to the noble Baroness for that reassurance. Is she aware that, despite those reassurances, the export of torture weapons is taking place? Is she further aware that specific companies have been named and that the veracity of the report of Mr. Martin Gregory on Channel 4 was challenged by Mr. Heseltine, which resulted in a libel settlement of £55,000, paid either by Mr. Heseltine or the taxpayer? Will the Minister look again at this problem? In addition to that, there has also been a report by Miss Sarah Wilson in the Scotsman. The Daily Mail, the Press Association and the Guardian have all referred to specific companies which are manufacturing or trading in these weapons, either directly or indirectly. Will the noble Baroness look at the whole matter again?
Baroness Miller of Hendon: My Lords, the noble Lord opposite has made many points and has taken quite some time to make them. I hope the House will allow me equal time so that I can deny all the allegations that the noble Lord opposite has made. The companies which are the subject of the allegations publicly denied them. The Home Office, the DTI, the Scottish Department and the Ministry of Defence, as well as various police forces, undertook the investigations. We have some of the toughest export controls in the world, and we shall act on any credible evidence that they are being evaded. The noble Lord mentioned many things which appeared in the newspapers—it is touching that he believes everything that he reads in them. But I say to him that, as was made clear in the agreed statement to the court, while the department accepted that the implications of the comments were not justified, that did not entail the acceptance of the accuracy of the allegations made against the Government in the programme. As I have said, the Government deplore the use of torture, and I stand by that statement.
Lord Molloy: My Lords—
Lord Harlech: My Lords, we have all been horrified by reports about the export of instruments of torture. Can my noble friend say what the Government are doing to oppose torture wherever it is occurring?
Baroness Miller of Hendon: My Lords, my noble friend is right. The Government do everything they can to oppose torture wherever it is occurring. They receive information from both government and other sources such as Amnesty International. Our embassies abroad regularly discuss our anxieties on human rights with countries which are believed to practise torture. The United Kingdom also plays an active role in the United Nations in supporting and developing international initiatives aimed at the prevention of torture. The United Kingdom also contributes to the United Nations voluntary fund for the victims of torture.

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I repeat again that the Government deplore the use of torture and would never knowingly support the export of equipment for such purposes.
Lord Molloy: My Lords, perhaps I may acknowledge what the noble Baroness has said on behalf of our Government and applaud it. Having said that, does she agree that there are cunning, terrible people who, despite the laws of our country, do these horrible things? Would it not be possible for our Government to see that their honourable policy is totally and thoroughly maintained at all times?
Baroness Miller of Hendon: My Lords, the Government are doing exactly that.
Lord Dubs: My Lords, what the noble Baroness has said is very interesting. But does what she has said about not exporting such terrible pieces of equipment apply also to electric shock batons?
Baroness Miller of Hendon: Certainly, my Lords. No companies or individuals in the United Kingdom currently have authority under Section 5 of the Firearms Act 1968 to manufacture, possess or deal in electric shock batons.
Lord Peston: My Lords, the answers given by the noble Baroness sounded most forthright to me and very much committed the Government to neither producing nor exporting weapons of torture. I take it that I am right in interpreting what the noble Baroness has said as being categorical. However, perhaps I may ask her—this is not a trick—whether her answers depend on the definition of the word "weapon". Could other items which are made in, and exported from, this country be used for torture? Can the noble Baroness assure me that she meant to say that no "instruments" of torture—if I may use that word rather than "weapons"—are made here or exported?
Baroness Miller of Hendon: My Lords, I would never assume that the noble Lord, Lord Peston, would ask me a trick question. Innumerable ordinary domestic and industrial products can be misused for improper or objectionable purposes for which, clearly, they are not intended—for example, DIY power drills, woodworking clamps and even toothpicks and cigarettes can be misused. I hate to think of all the possibilities. It is not practicable to seek to control trade in perfectly legitimate goods. The export of weapons and of restraint weapons—that is what we were talking about—is controlled by, as I have already said and I repeat forcefully, some of the toughest export controls in the world. I repeat that we shall act on any credible evidence that those controls are being evaded.
Lord Avebury: My Lords, the noble Baroness says that we would not permit United Kingdom companies to deal in implements of torture. Does she recall that the Channel 4 "Dispatches" programme cited the example of a person in the United Kingdom buying implements of torture from Mexico and exporting them to a third
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country? Is that unlawful? Have the Government drawn the attention of the police to that particular instance of export via a third country?
Baroness Miller of Hendon: My Lords, that programme certainly made such allegations; but the Government are not aware of any such cases. The United Kingdom does not have extra-territorial jurisdiction in respect of dealing in goods for which an export licence from the United Kingdom would be required. However, the Government are considering whether to cover such offshore sales—that is what the noble Lord is referring to—in the forthcoming consultation on a range of export control matters following the Scott Report.
Baroness Farrington of Ribbleton: My Lords, can the noble Baroness say whether the Government consider leg irons to be implements of torture?
Baroness Miller of Hendon: My Lords, leg irons are restricted articles for which export licences would not be granted.
Noble Lords: Next Question!
Lord Jenkins of Putney: My Lords, this is an important subject in which the Government's veracity is at stake—
Noble Lords: Oh!
Lord Jenkins of Putney: Oh yes, and I have to pursue it, if noble Lords will forgive me, by saying this—
Noble Lords: Question!
Lord Jenkins of Putney: By asking a question, then. Is it the case that the Government are stating their intention without enforcing it in practice? If that is the case, and since one cannot pursue the matter further at Question Time, there seems no alternative but to pursue it in another way by, say, an Unstarred Question or a short debate.
Baroness Miller of Hendon: My Lords, I am sorry that the noble Lord does not accept what I am saying. I repeat that the Government deplore the use of torture and would never knowingly support the export of equipment for such purposes.

Late Payment: Assistance to Small Firms
2.53 p.m.
Baroness Turner of Camden Baroness Turner of Camden asked Her Majesty's Government:
What action they propose to take to assist small firms facing bankruptcy, with consequent unemployment of their staff, as a result of the failure of large organisations to pay bills for subcontracted work.
The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish): My Lords, the Government are aware of the impact that late payment of commercial debt can have on small businesses. We are working with the business community on this issue. A significant package of measures was announced in 1994. In addition, the Prime Minister announced on 11th March this year new measures to tackle late payment, including consultation on whether public companies should be required to publish their payment performance.
Baroness Turner of Camden: My Lords, I thank the Minister for that Answer, but is he aware—I am sure that he is—that where payment is not made, unemployment will often result because the small firm cannot afford to keep its staff? Is he also aware that the suggestion that, for example, interest should be claimable on late payment would not necessarily help small companies because they would then become worried that they would not get another contract if they were awkward? Is the Minister aware that there is legislation in, I believe, the United States under which small firms have immediate access to the courts if they cannot get the payments that they are owed?
Lord Mackay of Ardbrecknish: My Lords, as is evidenced by the fact that my right honourable friend the Prime Minister raised the issue as recently as 11th March, we are certainly concerned about the question of late payment. I agree with the noble Baroness about a statutory right to interest, but in our consultations eight of the nine small firms' representative organisations voiced their opposition to statutory interest for fear of the detrimental effect that that could have on a small firm if the company were to say, "If you are going to charge me interest, I will find another supplier for my next order".
Lord Clark of Kempston: My Lords, does my noble friend agree that if the interest was mandatory after the credit term had expired and if everybody was subjected to such provisions, there would be no such competition between small businesses or fear of a contract being taken elsewhere because any company with a contract that was then transferred to another company, small or large, would be subjected to the same fine if payment was made late?
Lord Mackay of Ardbrecknish: My Lords, that may be true, but both large and small companies—small firms are not very quick to pay their bills either—could easily say, "Before I give you my business, can I have an extended term of credit from 30 to 60 days or from 60 to 90 days?" I believe that such provisions could be circumvented in that way.
Baroness Sharpies: My Lords, are government departments paying their bills on time?
Lord Mackay of Ardbrecknish: My Lords, my right honourable friends the Prime Minister and the President of the Board of Trade are very keen to ensure that government departments pay their bills on time. Every government department is asked to make a return
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annually on the speed with which it pays its bills with relation to the 30 working days limit. Looking at the table of those returns, I am happy to say that there have been considerable improvements and that the great majority of government departments manage to pay over 90 per cent. of their bills in that period. In addition to government departments, local authorities are important to small businesses in this way. We are discussing with the Audit Commission what could be done to ensure that local authorities pay their bills on time.
Lord Ezra: My Lords, following the question of the noble Lord, Lord Clark of Kempston, is it not a fact that a number of Continental countries have mandatory interest payments and that they have found that that has expedited the payment of bills?
Lord Mackay of Ardbrecknish: My Lords, I agree that a number of continental countries have such systems, but the evidence suggests that they do not improve the position greatly.
The Countess of Mar: My Lords, do the rules which apply to government departments apply also to National Health Service trusts, particularly when they are contracted with private facilities? I have had notice that one particular trust has delayed payments beyond six months.
Lord Mackay of Ardbrecknish: My Lords, all that I have with me is a list of government departments, so I am afraid that I cannot answer that question on healthcare trusts. However, I shall endeavour to find out the answer this afternoon and shall write to the noble Countess.
Lord Peston: My Lords, this is a difficult problem to solve. Does the noble Lord have any evidence that the problem is getting worse? Has anything occurred in the past few years to exacerbate it? One obvious thought that I had was that when interest rates were extraordinarily high one could see a culture of non-payment or delayed payment emerging, but, although that ought to be self-regulating as interest rates fall, the people who write to me about it say that the problem is just as bad now as it ever was. Although I am sympathetic to some of the Government's solutions, they all seem to share one troubling characteristic: they will make money for the banks rather than for the real economy. Will the Minister comment on that?
Lord Mackay of Ardbrecknish: My Lords, I do not know whether there is any particular reason why this has become a bigger problem over recent years, if indeed it has become a bigger problem. It would be unfair—if not against the rules of order and procedure—to ask all noble Lords who have paid bills rather late, having waited for red demands, to put up their hands. This is a matter which is probably of long standing. Something like 84 per cent. of small firms admit to paying their suppliers late. Although it is a problem, from the investigations that have been carried out, largely by Professor Nick Wilson of the University of Bradford,

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it is quite clear that small firms which have put in place good credit controls are not so plagued by the problem as those which do not have good credit controls in place.
Lord Skelmersdale: My Lords, if there is any logic in the economic theory just propounded by the noble Lord, Lord Peston, one would expect that as interest rates fell the factoring of invoices of small businesses would decline. Perhaps I may ask the Minister whether that has happened.
Lord Mackay of Ardbrecknish: My Lords, as I believe I indicated to the noble Lord, Lord Peston, I am not able to speculate on whether or not the position has changed due to the reduction in interest rates. I am afraid that I cannot help my noble friend in that regard either. I suspect that the increasing use of credit and cheque payments between companies and the competitive nature of business all play a part in the late payment syndrome.
Lord Bruce of Donington: My Lords, has the noble Lord had the benefit of consultations with his right honourable friend the Deputy Prime Minister, who, in the course of his excellent autobiography, described the very great benefits that accrued to middle-sized firms from delaying payment till the last possible moment?
Lord Mackay of Ardbrecknish: My Lords, first I should like to congratulate the noble Lord, Lord Bruce, upon having asked that question. I took a small wager with my staff on whether or not somebody would put that question to me. My right honourable friend the Deputy Prime Minister, who has had a successful business career and has suffered setbacks in that career at various stages, has propounded the simple proposition that when companies get into trouble it is important that their creditors are understanding. In that way, those companies can get out of the trouble and become good payers again.
Baroness Turner of Camden: My Lords, while I thank the Minister for his replies to the questions, does he agree that very often it is a matter of large firms withholding payment from small firms, as has happened in the case just reported to me? Does he also agree that the Government can do a great deal to change the general culture as well as introduce legislation? It would be of assistance if the culture was changed so that fast payment of bills was insisted upon in the case of small firms.
Lord Mackay of Ardbrecknish: My Lords, as far as concerns the case to which the noble Baroness has referred, of which I am aware, there is considerable dispute, as there often is in the building industry, between contractors as to the work done and the value of the work done. The case that the noble Baroness has in mind is very much on those lines rather than one where the principle is a desire not to pay the sub-contractor. The general point and those I have already made—which I believe have general agreement—that to put interest on late payment will have a detrimental effect on many small firms are issues that we come back to every time we look at the problem.

Prisoners: In-cell Television
3.3 p.m.
The Earl of Longford The Earl of Longford asked Her Majesty's Government:
Whether they consider that the removal of television sets from prisoners' cells is conducive to their rehabilitation.
The Minister of State, Home Office (Baroness Blatch): My Lords, my right honourable friend the Home Secretary announced on 16th October 1995 his decision to reject Sir John Learmont's recommendation that in-cell television should be made widely available. We are reviewing the position in respect of prisoners who have in-cell television in the establishments where the privilege is at present allowed to varying extents, but final decisions have yet to be taken.
The Earl of Longford: My Lords, do I gather from that Answer that the original statement that television in cells has been rejected has now been modified? Is the noble Baroness aware that everybody is opposed to this, including the Daily Mail, the last vestige of recondite Howardism, Sir John Learmont and so on? Am I to understand that the Government are for once backing down and showing good sense?
Baroness Blatch: My Lords, I may have to disappoint the noble Earl. The Home Secretary in his response to Sir John Learmont still believes that televisions in cells would not be consistent with the view that prison conditions should be decent but austere. Nevertheless, he is considering the policy; not reconsidering the fundamental policy. Provision for prisoners to watch television in communal areas during association periods and the use of television for information and educational programmes will be unaffected by this policy.
Lord Donaldson of Kingsbridge: My Lords, can the noble Baroness give an indication of the average length of time spent in cell in Her Majesty's prisons, since clearly the whole matter depends upon that?
Baroness Blatch: My Lords, I cannot give a precise answer. However, more prisoners than ever before spend more than 12 hours each day out of their cells. The improvement has been dramatic in the past three years. Forty-one per cent. of prisoners now spend more than 12 hours per day out of their cells compared with 24 per cent. only three years ago.
Lord McIntosh of Haringey: My Lords, does not the Minister's first answer shows a remarkable degree of indecision? It is more than six months since the Home Secretary opposed Sir John Learmont's view. We still do not know what the policy is. Prisoners do not know whether existing televisions are to be removed, whether there are to be separate categories for separate kinds of prison, like local prisons, or whether the presumed policy as announced by the Home Secretary is to be modified in any way. Is not such indecision a recipe for unrest in our prisons?
Baroness Blatch: My Lords, there is certainly no indecision. The noble Lord may well have noticed that the Home Secretary and the Home Office have been particularly busy on departmental policy in recent times. But there are important considerations, including timetabling, order and control and giving prisoners due notice. All these matters need to be taken into account in coming to a conclusion about the policy. However, the principle that in-cell television is not consistent with decent but austere provisions is still the basic policy. What we are considering here is implementation.
Lord McIntosh of Haringey: My Lords, in that case should not the Home Secretary consider the implications before making off-the-cuff comments, as he has?
Baroness Blatch: My Lords, my right honourable friend has not changed his fundamental view about in-cell television. He strongly believes that people who enter prison for wrong-doing should give up some of their everyday activities, one of which is in-cell television.
Lord Murray of Epping Forest: My Lords, if any action is to be taken, will the Minister at least consider the desirability of using televisions in cells as an incentive to good conduct, and in particular allow them to be installed in such areas as drug-free wings?
Baroness Blatch: My Lords, my right honourable friend the Home Secretary and his department very much believe that constructive activities are more effective in rehabilitation programmes than simply sitting around in cells watching television.

Business
3.8 p.m.
Lord Strathclyde: My Lords, after the Third Reading of the Defamation Bill, my noble friend Lord Lindsay will, with the leave of the House, repeat in the form of a Statement an Answer to a Private Notice Question in another place on the cattle disposal scheme.

Business of the House: Debate this Day
The Lord Privy Seal (Viscount Cranborne): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That Standing Order 38 (Arrangement of the Order Paper) be dispensed with today to enable the Motion standing in the name of the Lord Simon of Glaisdale to be taken immediately after the Defamation Bill.—(Viscount Cranborne.)
On Question, Motion agreed to.

Civil Aviation (Amendment) Bill [H.L.]
Lord Brabazon of Tara: My Lords, I beg to move that this Bill be now read a third time.
Moved, That the Bill be now read a third time.—(Lord Brabazon of Tara.)
Lord Boyd-Carpenter: My Lords, as a former chairman of the Civil Aviation Authority I very much welcome this Bill. It deals with what used to be a gap in the law governing civil aviation activities. It is good that, despite the pressure of other business, the Government have seen fit to introduce this Bill, which I hope your Lordships are about to approve.
Lord Brabazon of Tara: My Lords, I am most grateful for the support of my noble friend, speaking as he does as a former chairman of the Civil Aviation Authority. But I disagree with my noble friend on one small point. It was not the Government who introduced this Bill but myself. I am glad to tell my noble friend that the Bill has the support of the Government. I hope that it will also have the support of another place and become law before very long.
On Question, Bill read a third time.
Lord Brabazon of Tara: My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(Lord Brabazon of Tara.)
On Question, Bill passed, and sent to the Commons.

Misuse of Drugs Act 1971 (Modification) Order 1996
3.10 p.m.
The Earl of Courtown The Earl of Courtown rose to move, That the draft order laid before the House on 21st March be approved [15th Report from the Joint Committee].
The noble Earl said: My Lords, the purpose of this order is to bring the substances which are listed in the order within the terms of the Misuse of Drugs Act 1971.
In October 1992 the Government asked the Advisory Council on the Misuse of Drugs to consider whether anabolic steroids should be brought under control. The council concluded that there was sufficient evidence to conclude that the misuse of anabolic steroids and other substances with similar effects constituted a social problem—a key criterion of the Misuse of Drugs Act 1971—and should accordingly be controlled. It is that advice which has led to the order being brought forward.
The substances referred to as anabolic steroids have two effects. One is to increase muscle mass (the anabolic activity) and the other is to masculinise (the androgenic activity). Either one or a combination of these effects can be attractive to people who wish to improve their athletic performance or to enhance their physical appearance. They have to take them over a long period of time and to train hard if the desired results are to be achieved. The effects are not instantaneous and in that respect they are rather different from other controlled drugs.
Misusers take these drugs in quantities which greatly exceed therapeutic doses and we are concerned about the serious effects which they can have on their health. Reported side-effects include liver and kidney disorders, high blood pressure and adverse effects to sexual

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organs. There is also some evidence that steroids may cause changes in mood and behaviour, including increased aggression.
Injectors also run the risk of contracting HIV, hepatitis and other diseases through the use of non-sterile injecting equipment or through sharing needles. It is estimated that about 80 per cent. of those who take anabolic steroids take them through that method.
The extent of misuse is hard to gauge. But a study in 1992 into anabolic steroid misuse in Great Britain showed, through a gym survey and a survey of misusers using syringe exchanges, that misuse was spread through many parts of the country but appeared to be confined to persons who used them instrumentally in sports and weight training. Misuse was found to cover all social groups and to be a predominantly male activity from the late teens through the twenties and thirties. It was on the basis of those considerations that the advisory council recommended that anabolic steroids and similar acting substances should be controlled.
The council has recommended the substances in the order which we are considering. This begins with a list of 48 steroids with anabolic and/or androgenic activity. I shall give noble Lords a quick flavour of what they cover. They start with Atamestane, Methenolone, Methyltestosterone, Metribolone, Norclostebol, Norethandrolone, Oxandrolone, Enestebol, Ethyloestrenol, Fluoxymesterone, and I shall finish with Trenbolone. I am glad to note that the noble Lord, Lord Peston, is interested in that information which no doubt he already knew.
The order goes on in sub-paragraph (c) to provide a generic definition of substances which as yet have not been developed but if they were would have similar properties. It is thus a catch-all. The Act contains similar provisions which, for example, catch Ecstasy and its close relatives without naming them specifically. In addition to these anabolic and androgenic steroids there are in sub-paragraph (e) six further substances listed. These are also characterised by their muscle mass increasing properties and are known to be misused by body builders and sportsmen.
The order makes the substances Class C drugs rendering offenders liable on summary conviction to a maximum term of imprisonment of three months and/or a fine of £2,500 and on conviction on indictment to a maximum of five years and/or an unlimited fine.
Having brought the substances within the terms of the 1971 Act we propose by amendment to the Misuse of Drugs Regulations 1985 to make it an offence without authority to produce, to supply, or to possess or import or export with intent to supply, the specified substances. It would not, however, be an offence simply to possess these drugs in the United Kingdom. The advisory council took the view that the illicit dealers and traffickers should be the target rather than those who misuse anabolic steroids. After careful consideration we have accepted the council's recommendation which would in this respect put these substances into the same category as the benzodiazepine drugs such diazepam. Our intention is to bring the controls into force on 1st September.
I stress that addressing the supply side, which this order will do, is to deal with only one part of the problem. We need also to tackle demand, which we are doing through the strategy set out in the White Paper Tackling Drugs Together which is as applicable to anabolic steroids as it is to other drugs of misuse. Action across a range of fronts is required to make an impact on anabolic steroid misuse, as it is for all drugs. I beg to move.
Moved, That the draft order laid before the House on 21st March be approved [15th Report from the Joint Committed].—(The Earl of Courtown.)
Lord McIntosh of Haringey: My Lords, on the basis that the order follows directly, and without alteration, from the recommendations of the Advisory Council on the Misuse of Drugs, we on these Benches have no objection to its introduction, and we would not seek to oppose it in any way. Indeed, we congratulate the Government on following the scientific recommendations made to them.
One or two of the remarks of the noble Earl puzzle me. He referred to the possibility of misuse in more than therapeutic doses. I am not clear whether that means that within therapeutic doses it would still be legal. He said that many sportsmen and bodybuilders use far more than is required in therapeutic doses. Will therapeutic doses still be legal after the order takes effect? The noble Earl says that Ecstasy comes under the order. It is not clear where, in the four paragraphs of the order, it comes and what protection there is for future variations along the same general formula. Nor is it clear whether the undoubted ability of what one might call the fringe pharmaceutical industry to produce variations which would evade regulation of this kind will be controlled.
Finally, I am grateful for the confirmation that as a Class C drug it will be supply rather than possession of the drug that will be controlled.
The Earl of Courtown: My Lords, I thank the noble Lord, Lord McIntosh of Haringey, for his support of the order. He had two queries about the therapeutic uses of anabolic steroids. They will still be able to be prescribed by the medical profession. It is difficult to gauge where therapeutic use stops and abuse starts. This is an area where we are learning all the time. We shall continually monitor all aspects of anabolic steroid abuse.
I see from looking at my notes again that I was not clear when I referred to Ecstasy. As I understand it, Ecstasy is already covered under the Misuse of Drugs Act 1971. I mentioned it so as to make clear how under paragraph (2)(c) we use various chemical formulas to try to cover any future variation of anabolic steroids that may come to the market.
As regards consultation, perhaps I may confirm that the council took evidence from researchers who undertook an exploratory investigation of anabolic steroid use throughout Great Britain. That involved doctors from South Wales, who had particular experience with anabolic steroid use; the police; the Sports Council; and researchers who had investigated the psychological effects of anabolic steroid use. Research papers on the subject were also studied.

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Noble Lords will be pleased to hear that the order brings under control an entirely new range of substances. The Advisory Council on the Misuse of Drugs concluded that their misuse, in the words of the 1971 Act, was,
"having or appeared capable of having harmful effects sufficient to constitute a social problem".
We believe therefore that it is right and proper that they should be controlled. These substances will render liable to prosecution by the police people who illicitly supply them. There is no doubt in the Government's mind that it is against these people that the force of the criminal law should be directed. That is what the order, and the accompanying regulations, will bring about. I commend the order to the House.
On Question, Motion agreed to.

Deregulation (Resolutions of Private Companies) Order 1996
3.21 p.m.
Baroness Miller of Hendon Baroness Miller of Hendon rose to move, That the draft order laid before the House on 25th March be approved [17th Report from the Delegated Powers Scrutiny Committee].
The noble Baroness said: My Lords, the draft order under the Deregulation and Contracting Out Act 1994 will make some minor but important changes to company law. The changes affect the procedures which private companies must follow in respect of written and elective resolutions and can be summarised as follows. First, the present requirement for a minimum of 21 days' notice to be given of a meeting at which an elective resolution is to be proposed would be removed. That would allow such meetings to be held at short notice. But the dispensation would apply only where all members entitled to attend and vote at the meeting were agreeable to the short notice.
The second change relates to the passing of written resolutions under the Companies Act. At present, copies of proposed written resolutions must be sent to a company's auditors. If the resolution concerns the auditors as auditors they may, within seven days, give notice to the company that it should be considered in a general meeting of the shareholders. The resolution will not be effective unless the auditors inform the company that the resolution does not concern them as auditors, or that it does but need not be considered at a general meeting. If the auditors do not contact the company it must wait the full seven days before the resolution can come into effect.
That requirement has proved burdensome and time consuming. It has also been questioned whether the procedures apply to those companies which do not have auditors; for example, because they are dormant. As a result, the written resolution procedure is seldom used by private companies. They often resort to calling meetings instead and accept the additional expense incurred.
The draft order will, if accepted by your Lordships, reduce those burdens. The only requirement would be to send a copy of a proposed resolution to the auditors or to notify them in some other way of its contents at or before the time it is given to a member for signature. A breach of that requirement would be a criminal offence but would not affect the validity of the resolution. The order also provides certain defences for those responsible for complying with that requirement; namely, the directors and secretary of the company. The present requirement for auditors to be given seven days' notice of proposed written resolutions and for them to be able effectively to insist on a meeting being held would be repealed.
Finally, the draft order would amend the Companies Act to make clear that the statutory written resolution procedure may be used in addition to any provision for written resolutions in a company's articles. The company has a choice of which procedure it wishes to use.
In accordance with the usual scrutiny procedures under the Deregulation and Contracting Out Act there has been full public consultation on the draft order. It has also been considered by your Lordships' Select Committee on the scrutiny of delegated powers and the Deregulation Committee of another place. Under the original proposal for a draft order, which was laid before Parliament on 23rd October last year, the requirement to inform auditors of proposed written resolutions would have been revoked completely. A new requirement to send to outgoing auditors copies of agreed written resolutions which replace them with the new auditors would have been introduced.
The Deregulation Committee of another place expressed concern in its report that the proposal would remove some necessary protection from members of private companies. It therefore recommended, first, that auditors be sent copies of proposed written resolutions at the same time as members, or that they be informed of the contents of such resolutions no later than when they are first made available to members; secondly, that in order to enable auditors to provide advice to shareholders if requested to do so the proposed written resolution should not be adopted before notification of it has reached the auditors; and thirdly, that the requirement to notify auditors of proposed written resolutions should not apply to the category of companies which are not required to appoint auditors.
The Government considered carefully those proposed amendments and the draft order now before the House reflects the committee's recommendation with one exception. The draft order does not require notification of proposed resolutions to reach the auditors prior to their adoption. The Government consider that to include such a requirement in the written resolution procedure would add little in terms of shareholder protection and would reintroduce uncertainty and delay. Companies would continue to be discouraged from using the procedure and would continue to call meetings instead. In short, the opportunity for deregulation would be lost.
I should also mention that the requirement in the original proposal for a draft order to send to outgoing auditors copies of agreed written resolutions which

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replace them with new auditors has not been carried forward. That was considered unnecessary since the auditors would be informed of all proposed written resolutions.
The Deregulation Committee has considered the amended draft order and has recommended unanimously that it should be approved. When your Lordships' Select Committee on the scrutiny of delegated powers considered the original draft order it stated that it saw no objections to the Deregulation Committee's proposed amendments. The committee considered that no necessary protection would be lost if the draft order were made and it considered it an appropriate order to be made under the Deregulation and Contracting Out Act. In its second report, your Lordships' committee reported that the draft order now before your Lordships' House was in a form satisfactory to be submitted to the House for affirmative resolution. Finally, the committee reported that there was nothing in the draft order which the Joint Committee on Statutory Instruments would have needed to draw to the special attention of each House. I commend the draft order to the House.
Moved, That the draft order laid before the House on 25th March be approved [17th Report from the Delegated Powers Scrutiny Committee].—(Baroness Miller of Hendon.)
On Question, Motion agreed to.

Defamation Bill [H.L.]
3.27 p.m.
Read a third time.
Clause 2 [Offer to make amends]:
The Lord Chancellor (Lord Mackay of Clashfern)The Lord Chancellor (Lord Mackay of Clashfern) moved Amendment No. 1:
Page 2, line 43, leave out from beginning to ("and") in line 6 on page 3 and insert—

("(a) to make a suitable correction of the statement complained of and a sufficient apology to the aggrieved party,

(b) to publish the correction and apology in a manner that is reasonable and practicable in the circumstances,").

The noble and learned Lord said: My Lords, in moving Amendment No. 1 I shall speak also to the other amendments standing in my name. Although to some extent they deal with other subject matters they are linked in that they are responses to points raised by your Lordships during earlier proceedings and to which I undertook to give attention. The first set of amendments is concerned with the offer of amends; I shall deal with that first. Amendments Nos. 1 to 3 deal with problems which were raised by various sections of the media in relation to the offer of amends.
I should like to mention that my noble and learned friend Lord Denning, who as your Lordships know has not been able to attend this House for some time due to his physical disability, has asked me to tell your Lordships of his enthusiastic support for this Bill, although he is bodily at a distance.
As I said, the amendments which I am moving today result from helpful suggestions made at various stages of the Bill by your Lordships. As I hope your Lordships
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would expect, I have given very careful consideration to all the suggestions which have been made to me, and those which I will move today relate to two of the reforms made by the Bill.
First, I propose to make an important modification to the new procedure of the offer to make amends machinery, and some further modifications relating to the statutory privileges afforded to reports and other materials of the proceedings of particular courts, and of legislatures and specified other public proceedings.
Your Lordships will recall that the statutory privileges, originally contained in Section 3 of the Law of Libel Amendment Act 1888 and Sections 7 and 9 of the Defamation Act 1952, were urgently in need of being brought up to date, not least to reflect the changes which have been made in our relationships with other countries, both in Europe and internationally. In particular, as Lord Justice Neill's working group said:
"it is surely beyond question that in view of our entry into the European Community in 1973 the privilege accorded by section 7 and the schedule to the Defamation Act 1952 to newspaper [and other] statements by certain British officials and of certain categories of meetings or proceedings, within this country, should be extended to cover reports of similar matters within the community".
We have applied the same principles to the updating of Section 3 of the Law of Libel Amendment Act 1888, including a reference to the European Court of Justice in the Bill as introduced (following consultation on the draft Bill published last July), and your Lordships accepted my amendment at Committee to include also the European Court of Human Rights.
Noble Lords will recall that Clause 14 was amended while the Bill was in Committee, to provide a free-standing list, in subsection (3), of the courts to which the section applies, so that contemporaneous reports of their proceedings will be absolutely privileged. The noble Lord, Lord Williams of Mostyn, had tabled an amendment which partly coincided in effect with my own amendment, but would also have included international war crimes tribunals. I have concluded that it would be right to include such tribunals, and that is the purpose of Amendments Nos. 6 and 7.
The terms of the amendment will ensure that those international criminal tribunals which are recognised by the United Kingdom—including any such tribunals which may be set up in the future—will be covered. Hitherto, such tribunals have been set up by the Security Council of the United Nations, but we have provided for the possibility that we and other nations may in the future wish to make use of other international agreements. This is a precaution which it is right for us to take, although our earnest wish must be that there will be no further events making it necessary to set up such tribunals and have such trials.
Your Lordships may consider that the timing of this amendment is particularly opportune, as I understand that the hearing of the first case before the tribunal dealing with alleged war crimes committed in the former Yugoslavia is to begin today, and that this is the first war crimes trial since Nuremberg.
Amendment No. 12 is to similar effect, putting these international tribunals on the same basis as the other international courts already referred to in Part I of the first schedule, for the purpose of the qualified privilege conferred by Clause 15.
I turn now to the matters dealt with in the earlier amendments. I considered most carefully the concerns expressed by the noble Lord, Lord Lester of Herne Hill, and other noble Lords when the clauses introducing the new offer to make amends machinery and defence were previously considered by your Lordships. As your Lordships will be aware, those concerns were reflected in various sections of the media.
Those replace an existing defence which does not now fulfil the purpose for which it was created. Section 4 of the Defamation Act 1952 introduced a new statutory defence of unintentional defamation. It allowed a defendant who could prove his own lack of intention to forestall the plaintiffs claim provided he could act extremely quickly once he became aware that he had defamed the plaintiff.
The provision was intended to provide a speedy and relatively cheap way out of trouble in cases of "innocent" defamation. In practice, the formal requirements were found to be very cumbersome, and the stringent formal and other conditions were such that the defence was very little used. In the evidence before the Neill Committee, one of the most popular recommendations was for a more user-friendly defence in substitution for the old Section 4 defence. Such a defence could be loosely based on the best features of the old unintentional defamation defence, but without those features which had made the old defence so unattractive and unworkable in practice. It would avoid the need for a trial when the defendant was prepared to admit liability and to make amends, even though he could not meet all the conditions imposed by Section 4.
The Neill Committee recognised that it was impossible to produce a perfect solution, but its recommendation was that there should be a new, more streamlined defence, introducing certain changes which would remove some of the hurdles presently confronting defendants. The onus should not be on the defendant to prove lack of intention, and the defendant should have a more realistic time in which to decide whether or not to make an offer. On the other hand, it was not satisfactory for defendants to have a defence available, based on their reasonable behaviour after publication, which would leave the plaintiff with no compensation at all in respect of hurt feelings or injury to reputation caused by an admitted defamation.
During last year's consultation on the draft Bill we identified a further need. Many publishers welcomed the streamlining of the defence and the opportunity to make amends when they found that they had made a mistake. But they explained that it would still have to be limited when there was the possibility of a dispute as to the exact meaning of the statement. In those circumstances, a defendant might not be willing to make an open offer to make amends in case the court found that the meaning was more seriously defamatory than he was willing to
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concede. Nevertheless, a full trial could still be avoided if the provisions allowed the defendant to make an offer limited to the defamatory meaning which he was prepared to concede. Clause 2 is therefore an improvement on the published draft, allowing the defendant to make a qualified offer to make amends, specifying that meaning or meanings; that is, the meaning or meanings which the defendant is prepared to accept that the statement could bear.
I believe that those modifications were welcomed as meeting a real need; to overcome reluctance to make an offer because of the possibility of significant differences between the ways in which the parties would contend that the defamatory statement should be read. But it is another hurdle which has been stressed during the passage of the Bill. It was represented to me most forcefully that the media in particular would be disabled from using this procedure because they would not be willing to start up a mechanism which could end up as invoking a judge's power to dictate the terms of their apologies, and to compel them to publish those words in a particular way. Your Lordships may recollect a leader in which an important national event was signalled in the 10 o'clock news as following an intimation of some apology which, although no doubt very important for the person to whom the apology was made, it would not be seen as of shattering national importance.
As I said at Report, it seems to me that the dramatic examples which have been given to illustrate why the media would be reluctant to offer amends under these provisions do not reflect the likely reality of their operation. Nevertheless, we are all anxious to see that the new procedure will achieve the desired result, that where a person has been defamed, and the mistake is acknowledged, a system of speedy and voluntary amends should become the recognised conventional path to choose to resolve differences which might otherwise involve the parties in protracted and expensive litigation. This is something which may not happen if there is a general reluctance to come forward and make offers, even if that reluctance is attributable to what we would consider to be an unnecessarily cautious approach. As I said, I wish to reach the best possible solution to this problem. We want to encourage maximum use of the offer machinery, provided, of course, that its use will lead to effective amends being made to those who have suffered defamation.
Effective amends is the whole purpose and centre of the provisions. It involves not merely acknowledgement of the wrong but an attempt to undo the wrong which has been done. It is essential that the person who has done the wrong should be willing to, and should, take steps which will achieve that aim. It is in both parties' interests that the wrong should be righted as quickly as possible and as inexpensively as possible. In most cases, therefore, there is likely to be agreement as to the amends which will be appropriate.
But inevitably there will be some cases in which, although the parties are agreed in principle, they are unable to agree the exact steps to be taken. That may be because the offeror is not willing to apologise in terms

21
which would be acceptable to the wronged party and which the court would consider reasonable or he is not prepared to give his withdrawal a prominence which the wronged party considers proportionate to the prominence of the original published wrong; or it may be that the wronged party is making unreasonable demands. Only the court can judge in a particular circumstance which is the case. This is where I have modified the provisions. I believe that it would be wholly appropriate for the court to judge those matters and to make an order accordingly, so that the package awarded to the person who accepted the offer will reflect the full amends that he is entitled to expect when he accepts the offer—no more and no less.
It may be that a very limited publication is apt. It may be that the money element in the package, if any, would be very small. Nevertheless, it has been represented to me that there is a very real fear among the media that, if they made offers, orders might occasionally be made against them in terms which differed very radically from what they had contemplated when making the offer. It is suggested that while there was any such risk offers would not be forthcoming. Of course, the media do not have the exclusive privilege of being at the receiving end of libel claims, and this procedure is not designed for their exclusive use. But it is important that those who are defamed by the media should not be deprived of the benefit of it because of the reasons which I have outlined. I have, therefore, sought an accommodation to vary the provisions which will apply when the parties cannot agree the details in such a way as to preserve the core of the amends package while removing that element which was seen as a serious disincentive to offering amends; namely, that offers might rarely, if ever, be made.
The amendments now proposed to Clauses 2 and 3 maintain the emphasis on the need for appropriate publicity being given to the correction and apology. But if the parties fail to agree those details, the defendant must take his chances on the basis of his best offer. The details of his best offer—as to wording and manner of publication—will be scrutinised by the court. If the court thinks that the plaintiff's demands for more were unreasonable, the position will be much the same as if the court had made an order coinciding with the best offer. If, however, it falls short of what the court considers to be adequate, that will be reflected in the money compensation.
One possibility which did concern me was that an offer of amends might be made as something of a tactical ploy by a person who had no intention whatever of righting the wrong in the manner contemplated by the provisions and whose "best offer" might even exacerbate rather than amend the original wrong. It is an established principle of defamation law that conduct after the original publication may be taken into account in the assessment of damages, whether that conduct shows a will to make good or determination not to do so. I have taken great care, therefore, to ensure that that principle is clearly manifested in the provisions. If it appears that an offer has been made hypocritically, that may indeed sound in the compensation. That, I think, will discourage any attempt to abuse the new machinery.
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For the convenience of your Lordships, I have sought to explain all of the amendments tabled in my name at the same time. I beg to move Amendment No. 1.
3.45 p.m.
Lord Williams of Mostyn: My Lords, perhaps I may respond in the same way as the noble and learned Lord the Lord Chancellor on the matter of the scheme. I am most grateful for the noble and learned Lord's proposed Amendments Nos. 6, 7 and 12 which, as he indicated, give a necessary and appropriate protection to contemporaneous, fair reports of the proceedings of international criminal tribunals. I am certainly conscious that a good deal of thought has been given to the concerns raised by the noble Lord, Lord Lester of Herne Hill, and myself, as well as others, relating to directed corrections or apologies which editors of newspapers and television programmes strongly resisted.
However, I have one question regarding Amendment No. 2. Paragraph (a) refers to,
"the correction and apology by a statement in open court".
Under the present scheme of the rules of court, it seems to me that that would mean that the offer of amends could be put into effect only after the issue and service of the writ. I wonder whether the noble and learned Lord would confirm that interpretation.
The noble and learned Lord indicated that he wished maximum use of the offer of amends machinery to be made. Therefore, it is a pity that Clause 2(5) still contains the prohibition on the ability to make amends after the service of a defence. Generally speaking, it seems to me that a reasonable balance is now capable of being struck between the utility of the procedure—that is, the offer of amends procedure, which ought to he reasonably quick and cheap and, therefore, reasonably acceptable to the parties—and the legitimate concerns, as foreseen by at least two of us, of editors of publications and television programmes. As a matter of principle, I welcome the improvements to the offer of amends machinery.
Lord Lester of Herne Hill: My Lords, like the noble Lord, Lord Williams of Mostyn, I greatly welcome the first amendment and, indeed, all of the amendments to which the noble and learned Lord has spoken. If I may say so, it is particularly gratifying that the noble and learned Lord has responded in a characteristically open-minded way, not only to the debates in your Lordships' House but also to the representations that have been made outside the House.
I should, first, declare a personal interest, as occasionally clients are foolish enough to ask me to appear as counsel in libel cases, normally on the side of newspapers. But, speaking for myself, I view the first amendment as being damaging only to the interests of the libel Bar, as it will surely mean some reduction in our income if, as we hope, the effect of the amendment will be to discourage avoidable libel litigation and favour instead the much more sensible approach which the offer of amends procedure is intended to achieve.
In my view, the great virtue of the amendments is that they strike a fair balance between, on the one hand, the important conflicting public interest—that is, the public

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interest in vindicating the right to personal reputation—and, on the other hand, the important public interest in freedom of expression. I am glad to see that judicial protection is retained in the amendments. Although editors regard that as being a matter within their exclusive sovereignty, they must surely realise (and I am sure that those who are responsible do) that ultimately it is for the courts and not for them to decide how to strike that balance.
I believe that the fears expressed by the media may have been exaggerated. However, I am sure that the noble and learned Lord is wise to respond to those fears so that the media have no excuse for not making full use of the fast-track procedure; that is, the offer of amends procedure. I very much hope that all those who advise the media will impress upon them the importance of making the system work rather than raising legalistic or pedantic points. For all those reasons, I am delighted that the first amendment has been tabled in such a form that it meets those legitimate interests while still preserving the core of the very sensible procedure of which the members of the committee of Lord Justice Neill were the original architects. I therefore strongly support the amendment.
The Lord Chancellor: My Lords, I am grateful for the support given to the amendments. With regard to the point on the Rules of Court made by the noble Lord, Lord Williams of Mostyn, I think that adjustment of the rules will be required to take account of these procedures.
On Question, amendment agreed to.
Clause 3 [Accepting an offer to make amends]:
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 2 and 3:
Page 3, line 22, at end insert (", as follows.
( ) If the parties agree on the steps to be taken in fulfilment of the offer, the aggrieved party may apply to the court for an order that the other party fulfil his offer by taking the steps agreed.
( ) If the parties do not agree on the steps to be taken by way of correction, apology and publication, the party who made the offer may take such steps as he thinks appropriate, and may in particular—

(a) make the correction and apology by a statement in open court in terms approved by the court, and

(b) give an undertaking to the court as to the manner of their publication.

( ) If the parties do not agree on the amount to be paid by way of compensation, it shall be determined by the court on the same principles as damages in defamation proceedings.
The court shall take account of any steps taken in fulfilment of the offer and (so far as not agreed between the parties) of the suitability of the correction, the sufficiency of the apology and whether the manner of their publication was reasonable in the circumstances, and may reduce or increase the amount of compensation accordingly.
( ) If the parties do not agree on the amount to be paid by way of costs, it shall be determined by the court on the same principles as costs awarded in court proceedings.").
Page 3, line 23, leave out subsections (3) to (5).
The noble and learned Lord said: My Lords, I have spoken to these amendments. With your Lordships' leave, I beg to move Amendments Nos. 2 and 3 en bloc.
On Question, amendments agreed to.
Lord Hoffmann Lord Hoffmann moved Amendment No. 4:
After Clause 13, insert the following new clause—
EVIDENCE CONCERNING PROCEEDINGS IN PARLIAMENT
(".—(1) Where the conduct of a person in or in relation to proceedings in Parliament is in issue in defamation proceedings, he may waive for the purposes of those proceedings, so far as concerns him, the protection of any enactment or rule of law which prevents proceedings in Parliament being impeached or questioned in any court or place out of Parliament.
(2) Where a person waives that protection—

(a) any such enactment or rule of law shall not apply to prevent evidence being given, questions being asked or statements, submissions, comments or findings being made about his conduct, and

(b) none of those things shall be regarded as infringing the privilege of either House of Parliament.

(3) The waiver by one person of that protection does not affect its operation in relation to another person who has not waived it.
(4) Nothing in this section affects any enactment or rule of law so far as it protects a person (including a person who has waived the protection referred to above) from legal liability for words spoken or things done in the course of, or for the purposes of or incidental to, any proceedings in Parliament.
(5) Without prejudice to the generality of subsection (4), that subsection applies to—

(a) the giving of evidence before either House or a committee;

(b) the presentation or submission of a document to either House or a committee;

(c) the preparation of a document for the purposes of or incidental to the transacting of any such business;

(d) the formulation, making or publication of a document, including a report, by or pursuant to an order of either House or a committee; and

(e) any communication with the Parliamentary Commissioner for Standards or any person having functions in connection with the registration of members' interests.

In this subsection "a committee" means a committee of either House or a joint committee of both Houses of Parliament.").
The noble and learned Lord said: My Lords, this amendment was moved in Committee and withdrawn; it was moved again on Report and, but for a procedural mishap, would have been withdrawn. I now move it again with the leave of your Lordships' House. On the previous two occasions the House was, perhaps not surprisingly considering the subject matter, somewhat thinly attended. As there are now more noble Lords present, I ask the indulgence of the House if I cover what to some will be familiar ground.
This amendment has been stimulated by two recent cases, one in the Privy Council and one in the courts of this country. The English case is that of Mr. Neil Hamilton, a Member of another place and formerly a junior Minister. The Guardian newspaper published an article which he says amounted to an allegation that he made corrupt use of his position. He was said to have received payments from a businessman in return for asking Ministers questions which were intended to further that businessman's interests. The matter was taken sufficiently seriously for him to be asked to resign from the Government with no prospect of return until he had cleared his name from the Back Benches. This he attempted to do. He issued proceedings for libel. The Guardian pleaded justification. It said that what it had printed was true. But then the question arose as to whether

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the court could decide this matter. It would involve investigation of what a Member of one of the Houses of Parliament had done in the course of his parliamentary duties. The court held that this would be contrary to Article 9 of the Bill of Rights of 1689, which is headed "Freedom of Speech" and provides,
"That the freedom of speech and debates or proceedings in Parlyament ought not to be impeached or questioned in any court or place out of Parlyament".
The primary purpose of Article 9 is of course to protect honourable Members and noble Lords from legal proceedings such as actions for libel, or in the old days prosecutions for sedition, on account of what they say or do in Parliament. This guarantees that complete freedom of speech which is essential to the functioning of Parliament and which was part of the settlement after the Glorious Revolution. In the 300 years since then the courts have given Article 9 a wide construction. It applies not only to actions against Members or noble Lords for what they have said in Parliament, but to any proceedings in which it is sought to question what has happened in Parliament. Indeed, the article has been said to be only part of a wider privilege which Parliament has to control its own proceedings and which in the 19th century was famously held to include the right to prohibit publication of reports of its debates.
There has been no previous case in England in which a Member of either House has sought to bring a libel action which raised a question about his own parliamentary conduct. But there has been at least one in Australia. It so happened that there had recently been a case in New Zealand, Prebble v. Television New Zealand, which came before Members of your Lordships' Appeal Committee sitting in their capacity as Members of the Judicial Committee of the Privy Council. In that case it was decided that the court could not inquire into parliamentary conduct and that if the effect of that was to stifle a defence—on the part of, in that case, the television company, or the newspaper—that defamatory allegations were true, the Member's action would have to be stayed. So following that decision, the judge who was hearing Mr. Hamilton's case decided he could not investigate whether the Guardian's defence was true or not and that Mr. Hamilton's action would have to be stayed. So it remains technically in limbo but for practical purposes dead. Unless there is a change in the law which enables the judge to decide whether or not the Guardian was right, Mr. Hamilton cannot sue it. There is nothing which he can do to clear his name.
I should say at once that I do not know Mr. Hamilton and I have never met him. Nor, of course, do I have any idea as to where the truth lies in the dispute between him and the Guardian. But I am sure your Lordships will agree that it is unjust that he should not be able to put the matter before a judge and jury, like any other citizen who considers that his integrity has been publicly defamed. It is therefore to redress this injustice to Mr. Hamilton and anyone else who may in future find himself in the same position that I put forward this amendment. Its effect—if I may summarise—is to allow a Member of either House in defamation proceedings to lift a corner of the curtain which the Bill of Rights draws
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over parliamentary proceedings and to allow the judicial gaze to fall upon his conduct alone. In no other way does it touch upon Article 9 or the privileges of Parliament.
If this amendment is passed it will give Mr. Hamilton access to justice which is at present denied him. As to this, I think that your Lordships can be in no doubt. But while access to justice is a matter of high constitutional importance, I recognise that it cannot always take paramount place. There are other aspects of the public interest to which it must sometimes defer; and one of these is the proper functioning of a democratic Parliament, which in our ancient constitution is still underpinned by the Bill of Rights. Notwithstanding my natural concern as a Member of the Appeal Committee of your Lordships' House with the administration of justice, I recognise the importance of these other constitutional issues. For that reason I do not see myself in the role of a partisan advocate of this amendment. The case for the amendment is fairly plain and I have made it already. But I also conceive it my duty to lay before your Lordships the arguments against the amendment so that you may better be able to balance the claims of justice against other interests of state.
One does not have to look very far for an example of access to justice being necessarily subordinated to the proper functioning of Parliament. The absolute privilege which the Bill of Rights gives to parliamentary debates and to newspaper reports of those debates means that a citizen who is defamed by something said in Parliament has no remedy in the courts. Even if the defamation was grave and malicious, his interests are sacrificed to the paramount interest of allowing uninhibited free speech in Parliament. So it is argued by some that the present case is only the other side of the coin. If honourable Members can say what they like about other people without being sued, why should they be able to sue for what other people say about them?
I think that this symmetry is deceptive. The public interest in freedom of speech in Parliament is ancient, plain and obvious. Not only is it greatly prized; it is also jealously guarded against misuse. Both Houses have their own disciplinary procedures against Members who abuse the privilege to defame outsiders. But what is the public interest in allowing anyone free licence to make defamatory statements about what honourable Members or noble Lords do in the course of their parliamentary duties? It may be said that they are public figures and that therefore in the interests of general discussion of public affairs they should have to submit to what may be said about them. The United States comes close to having such a rule. It allows public figures to sue for defamation only if they can prove that the statement was made with malice or reckless disregard of the truth. It is not enough for them to be able to show or even to require the other side to show that it was wrong.
But there is little support for such a rule in this country. And to maintain the rule with which we are concerned today would be a very eccentric way of giving effect to a policy of free discussion of public figures. First, it would apply only to what they did in the course of their parliamentary duties. If Mr. Hamilton had been alleged to be corrupt in the performance of his

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duties at the Department of Trade, there is no doubt that he could have sued for libel like anyone else. There is simply no logic in a distinction between what he does in that capacity as a public figure and what he does as a Member of another place.
Secondly, under the present rule, Mr. Hamilton is not even able to sue as he could in the United States, if the newspaper were malicious or reckless. He cannot sue at all.
Thirdly, there is no domestic procedure for restraining abuse, as there is in the case of defamatory statements made by honourable Members or noble Lords. It may be theoretically possible for the Committee of Privileges in the other place to declare that a false statement about the way in which a Member of the other place performed his duties was an infringement of the privilege of the House. I have not really considered the matter because I am sure that your Lordships will agree that from a political point of view such a procedure would not in practice be a feasible remedy.
The argument that honourable Members or noble Lords must take the rough of the Bill of Rights with the smooth does not stand up to critical examination. There is not even a connection between those who get the smooth and those who get the rough. To leave an honourable Member defenceless against attacks on his honesty because some other Member might be tempted to abuse his privilege of free speech is like some primitive form of collective punishment. But I readily acknowledge that the argument has a certain superficial attraction and your Lordships may think that regard should be paid to the way in which a proposal may be received irrespective of whether that perception is based upon any very coherent analysis of what the public interest requires.
The second serious argument against the amendment is that it has not been sufficiently considered. It is true that this is the third occasion on which it has been before the House and it will, of course, have to undergo further consideration in another place. But in the scale of the three centuries for which Article 9 of the Bill of Rights has survived untouched, the proposal can fairly be described as novel. It is not surprising, therefore, that concern has been expressed by people who have the interests of Parliament at heart, not only in this country but also in the Commonwealth. In this debate, my noble and learned friend Lord Simon of Glaisdale will be speaking to a Motion which he has put down to refer the matter to a Joint Committee of both Houses of Parliament.
I have great sympathy with my noble and learned friend's point of view. I say at once that I must confess to being extremely nervous at having put down a proposal which touches in any way upon the Bill of Rights, even though at the moment I think it to be totally innocuous and indeed beneficial. I think that my noble and learned friend's proposal would ideally be the right one. And, of course, it may be that my noble and learned friend and other noble Lords, in the course of this debate, will persuade me and others that there really are pitfalls for which such an inquiry is the only answer. But if that course were taken, the remedy, if any, would
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almost certainly be too late to help Mr. Hamilton. By the time the committee had reported, and parliamentary time had been found to pass its recommendations into law, his claim would be very stale indeed. The beneficiaries would be future honourable Members or noble Lords who might find themselves in Mr. Hamilton's position. And since, so far as I know, his is the first case of its kind in this country for 300 years, it may be some time before the change has any practical effect. So your Lordships have to decide whether or not Mr. Hamilton is to be allowed access to justice. From his point of view, justice delayed will be justice denied. Your Lordships must consider the arguments and decide whether there are constitutional considerations of sufficient weight to require that he should be denied a remedy.
The third argument against the amendment is that there are objections of principle and practical difficulties about the way in which it may operate. It allows, as I said, an honourable Member or noble Lord to permit judicial scrutiny of his own conduct in Parliament and not that of anyone else. The objection in principle is this: that the privilege of Parliament is the privilege of each House as a whole and not that of any individual Member. It should therefore only be capable of being waived, if at all, by a resolution of the House. But I do not think that that would be a practical solution. There is no precedent for the House being able to waive the privilege so far as it protects the free speech of an individual Member and for my part I think that that would be a dangerous doctrine. It would enable a majority to deprive an unpopular member of a minority group of his essential constitutional right to freedom of speech. Equally, in a case like this, the right of a Member to sue for libel would be dependent on a resolution which may be influenced by factional interests. So there should be no general principle of waiver by resolution of the House. The remedy offered by the amendment is essentially a private matter for the Member who has been defamed, and that is how I think it should be.
I am aware of one practical problem, and there may be others. The one I have in mind arises in a case in which two or more Members are together concerned in conduct in respect of which one of them wants to sue for libel. How, in that case, can one of them allow his conduct to be investigated by the court without at the same time exposing the conduct of his colleagues to investigation as well? In a case in which one person's conduct is inextricably mixed up with that of another, how in practice is the subsection to be given effect?
I shall not disguise the fact that there is no easy answer to this question which has never arisen and may never do so. But judges are accustomed to finding themselves in a position in which, in the course of having to do justice between plaintiff and defendant, they have to protect the interests of third parties who have become involved. Sometimes they will find it possible to decide the case without trespassing upon the interests of others; sometimes they will protect him by prohibiting publication of evidence or names. I think that this is a problem which will have to be resolved if and when it arises. It does not, so far as I know, arise in the case of Mr. Hamilton.
Finally, it is said that this is an amendment which should originate, if at all, in another place. It arises out of the particular case of an honourable Member, and the privilege itself, although it belongs to both Houses, is historically more closely associated with the other place. I intend no trespass upon the dignities of the other place. No one could be more conscious of the need to respect its privileges than my noble friend Lord Tonypandy who spoke in the debate on this amendment at Committee stage. He made no suggestion then that anyone would take offence. All that your Lordships are being asked to do is to provide the other place with a text which it may accept, reject or amend with the benefit of such consideration as your Lordships are able to give it.
In conclusion, in placing this amendment before your Lordships, I should emphasise that it is not essentially a matter of lawyers' technical law. The question here is striking the balance between the right of access to justice and any countervailing considerations of public interest. In deciding this question, noble and learned Lords have no advantage over others of your Lordships in knowing what is the right solution. In that spirit, I beg to move.
Lord Renton: My Lords, I am sure that we have all heard what the noble and learned Lord, Lord Hoffmann, said—
The Lord Chancellor: My Lords, I ought now to call, as an amendment to Amendment No. 4, Amendment No. 5.
Lord Simon of Glaisdale Lord Simon of Glaisdale had given notice of his intention to move, as an amendment to Amendment No. 4, Amendment No. 5:
Line 3, after ("may") insert (", with the consent of both Houses of Parliament,").
The noble and learned Lord said: My Lords, I thought that I had withdrawn Amendment No. 5. I did not want an already complicated issue made more complicated. It seemed to me in every way more satisfactory that your Lordships should have to decide whether to accept the amendment in the name of my noble and learned friend Lord Hoffmann or to let the matter be decided primarily in the other place but subject to review by your Lordships.
There can be no question but that the amendment raises matters of the highest constitutional importance. As the noble Lord, Lord Kingsland, said at Report stage, the Bill of Rights is at the very heart of our constitution. The amendment seeks to tamper with the Bill of Rights. Your Lordships will be grateful to my noble and learned friend Lord Hoffmann for having brought the matter before your Lordships and set it out in such an attractive manner today.
I have every sympathy with Mr. Hamilton, who is not the only one concerned. As my noble and learned friend said, in effect he has been denied recourse to the courts of justice. That has been inherent in the Bill of Rights for over 300 years. Any statement or proceeding in Parliament is immune from scrutiny and whoever wishes to challenge it, equally with Mr. Hamilton, has been throughout without recourse to the courts of
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justice. The difference this time is that there is a backlash so it is the Member of Parliament who is not immune but who seeks relief. It is the reverse of what has obtained until now. It is implicit in the Bill of Rights and will remain implicit after the amendment passes into law, if it is agreed to, that a party is inhibited from recourse to the courts of justice.
Before turning to major matters, perhaps I may take up three points to which my noble and learned friend referred. He described the present situation as giving free licence to anyone to defame, without any danger and without redress, a Member of Parliament. I do not accept that for a moment. Parliament itself has its own machinery for ensuring that that kind of injustice is not perpetrated.
The second point to which my noble and learned friend referred was the liability to partisanship if the matter were to depend on the vote of either House of Parliament. Again, I am afraid that I do not accept that. A number of noble Lords were Members of the other place and I hope that they will bear me out when I say that the Privileges Committee of the House of Commons acts judiciously and fearlessly. Moreover, although its recommendations are generally, but not invariably, accepted by the House, I cannot accept that the House itself is liable to unfair partisanship.
There was the notable case in 1947 of Mr. Garry Allighan, who behaved disgracefully. There was a large Labour majority in the House at the time, he was a Labour Member and he behaved so disgracefully that the Leader of the House brought a Motion proposing that Mr. Garry Allighan should be suspended without pay for six months. However, the House went further than that. The House, being predominantly of Mr. Allighan's party, accepted an amendment that he should be expelled and so he was. So I am afraid that I do not accept the argument that the House of Commons is incapable of judging such matters fairly, that it will always be warped by partisanship.
The third preliminary matter which my noble and learned friend mentioned was the position of my noble friend Lord Tonypandy. Unfortunately he cannot be here today as he is in hospital, but we share an office and I discussed the matter with him after the Report stage. He agreed strongly that the matter should be primarily the concern of the House of Commons and should be left to it for the initial decision. I telephoned him in hospital only last Thursday to ensure that he was of the same opinion. He is and he authorised me to say so.
So much for the preliminary points made by my noble and learned friend. I hope that he will not press the amendment. In the first place, it needs much more consideration and consultation than it has received, particularly consultation with the officers of both Houses and with Commonwealth parliaments. The matter has arisen in both New Zealand and Australia and there are already rumblings of concern from the Antipodes at the amendment moved by my noble and learned friend.
Secondly, it seems to be highly unsatisfactory that such a constitutional point should be implemented as a by-blow in a defamation Bill. Thirdly, it seems to me primarily a matter which should be left for the initial

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consideration of the other place. The events which led to the Bill of Rights were exclusively those in the House of Commons. The two current cases, one of which is Mr. Hamilton's, are both in the House of Commons.
There is a further reason why it seems that the matter should go untrammelled to the other place. If your Lordships were to inscribe this amendment on the Bill, it would form part of the Government's Bill and, I surmise, be the subject of a running Whip. However, if it is left to be independently advanced in the other place, the Government having proclaimed neutrality, there would be a free vote. Surely, on a constitutional matter of this kind, that is in every way preferable. So I hope that my noble and learned friend will not press the amendment. There are grave difficulties anyhow. The assumption behind it is that there is an individual privilege of a Member which he himself can waive. But that is not so. It is universally agreed that it is stated by Erskine May and all the other authorities that the privilege is that of the House or, in some cases such as with the Bill of Rights, of Parliament. If a Member, by implication—and it is no more in this amendment—is able to waive his own privilege, in so far as he has one as a Member of the other place or this place, there remains the privilege of the House as a whole. That means that the House as a whole can take cognisance of the conduct or words in question.
In the most recent case that reviewed this matter, Pickin v. BR some 20 years ago, it was emphasised that it would be quite intolerable if there were two inquiries going ahead simultaneously or overlapping, one by the courts of law and one by the House of Parliament. The amendment would land us in a whole number of respects in precisely that situation.
A number of very difficult expressions would fall for interpretation in the courts, the most important being "proceedings in Parliament". There is every reason to think that that might be differently interpreted by the courts and by the House itself.
Then there is the difficulty to which my noble and learned friend referred, whereby our two Members are in a similar position. They are accused jointly of being corrupt. One waives privilege and sues; the other stands on his rights. What is to be done? My noble and learned friend mentioned that but did not offer any solution. I can see no solution that would be consonant with justice. In fact, the sensible thing now would be for the House to conduct its own inquiry, taking no notice of any pretended waiver by one Member; but he would have a statutory right by implication to have that waiver.
There are three different sources of privilege which have different scope and different incidence. There are the privileges that are asked by the House of Commons of the Queen at the Opening of Parliament—the three requests that are made. The most important of them is freedom of speech, which is largely merged now, I believe, in the Bill of Rights. That is a privilege of the House of Commons alone, although this House probably has similar privileges.
Then there is the privilege of the Bill of Rights as to words, conduct and proceedings in Parliament. As my noble and learned friend said, there is a far wider scope
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of privilege. The privilege of the Bill of Rights is the privilege of the whole of Parliament alone and cannot, I believe, be waived by either House. I am glad to see the noble Lord, Lord Richard, a distinguished constitutional lawyer, nodding his acquiescence. I hope he will intervene in this debate. He has had ministerial experience of both Houses and his service abroad gives him a comparative outlook.
There is a third group of privileges which I believe belong to each House separately. They go very wide. Noble Lords may remember that A. P. Herbert, before he became a Member of Parliament, pursued a campaign against the restrictive licensing laws. A prime target was Parliament, which enacted those laws but did not obey them. He took out a summons against the refreshment manager of the House of Commons. The Chief Metropolitan Magistrate dismissed that and it was dismissed on appeal by the Lord Chief Justice. Even the opening hours in the bars in Parliament are covered by privilege—not by the Bill of Rights, but by the wider privilege. So the House will see how far we can go from defamation.
That brings me to defamation itself. On Report, my noble and learned friend the Lord Chancellor was inclined to doubt whether there would be any cases of tort other than defamation. But, considering A. P. Herbert's case, can one be so sure? In any case, assault and battery is a tort as well as a crime. Let us suppose that two Members come to fisticuffs on the Floor of the House. Who has the right to claim that the other is the aggressor and that he is engaged in no more than self-defence? Let us suppose, for instance, that a campaigning journalist comes face to face with his victim, a Member, in the Lobby. What is the position then? There arises the sort of question that examiners like to set: "Supposing there was that sort of scuffle in the gateway between New Palace Yard and Parliament Square …". It simply cannot be assumed that this is a defamation problem only and whatever is important can be dealt with by a defamation Bill.
The fifth point of difficulty was mentioned on the last occasion by the noble Lord, Lord Lester. I shall leave him to deal with it. If this amendment were passed, it would require something further; namely, the availability of qualified privilege by the newspaper or other organ of the media.
There is another very important point; namely, what about public opinion? Public opinion regards Parliament somewhat askance. In Committee, my noble and learned friend Lord Hoffmann mentioned "saloon bar opinion" and "saloon bar cynics". What would they say if this House were to approve a measure that allowed a Member to pick and choose: to stand on his privilege when it suits him but to waive it when that suits him? Noble Lords may think that Parliament should have regard to the likely repercussions on opinion.
There are two more short points. First, what about Scotland? One of the many doubtful points in this branch of the law is whether the Bill of Rights applies to Scotland. In fact, the Bill of Rights was passed before

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the Act of Union, and Scotland has its own declaim of rights. It is by no means in the same terms as the Bill of Rights; but that, again, is a matter that requires investigation.
Finally, there is the matter I mentioned of Commonwealth repercussions. It is for those reasons that I put down the Motion which is to be taken immediately after this Bill and which has been discussed along with it. As at present advised, I do not propose to move that Motion because I feel that the whole matter should go to the other place completely untrammelled and with a clean slate. I shall listen to what your Lordships have to say about that. In the meantime I suggest that on a matter of such constitutional importance this amendment ought not to be accepted.
[Amendment No. 5, as an amendment to Amendment No. 4, not moved.]
4.30 p.m.
Lord Richard: My Lords, I never cease to be amazed at what is said in this place. Coming from such a great constitutional lawyer as the noble and learned Lord, Lord Simon of Glaisdale, to be classed as a distinguished constitutionalist is an accolade of which I am very proud. Perhaps I should increase my fees somewhat. Not as a distinguished constitutional lawyer but as someone trying to approach this difficult question with a degree of common sense, let me put certain basic propositions to the House. I shall do it in very short order.
I start by saying that I have considerable sympathy with Mr. Hamilton. This is a situation in which, because of the nature of parliamentary privilege in this country, prima facie a case which would have gone through the courts in the normal way is now not capable of doing so. As I understand it, whatever happens to this amendment does not defeat the case. The case is not statute barred. As I understand it, it is stayed for the time being.
The noble and learned Lord, Lord Hoffmann, did the House a service in setting out at some length the background to the argument. It was notable that, in the course of his argument, he conceded that there was an effect on Article 9 of the Bill of Rights of 1689. He said that what we should be doing in this House is providing the other place with a text. With great respect, I do not believe that that is the function of this place. We are supposed to be legislating. We are supposed to be considering adding a clause to a Bill which in due course will go to the other place for its consideration. We are performing our legislative function and not providing the other place with a text which they might or might not wish to consider.
Let me put to the House what I hope are relatively simple propositions. First, does the proposed amendment go to the issue of the privilege of Parliament and Members of Parliament? The answer is clearly yes. Secondly, whose privilege is it—the individual's or Parliament's as a whole? The answer is also clear: it is the privilege of Parliament as a whole and not of one individual Member. My third proposition is: if the amendment is accepted, does it alter the privileges as
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expressed in the Bill of Rights of 1689? The answer is clearly yes. If it does and if there is a case for altering the privileges of Parliament or of individual Members of Parliament, as expressed in the Bill of Rights of 1689, how should Parliament go about altering that Bill of Rights? I venture to suggest that an amendment tacked on to the Third Reading in your Lordships' House of a Bill on defamation is, frankly, not the way in which a constitutional issue of such importance should be considered.
However one looks at the matter and however much sympathy one has for Mr. Hamilton, and indeed the other defendant in this affair, it goes to the root of the constitutional relationship between Parliament and the British public. We are talking about a privilege that is attached to Parliament. With great respect, I do not believe that one should deal with the matter in this way.
If the matter should not be dealt with in that way, how should one do it? It seems to me that there is here an issue that is worth considering and that should be considered. Who should consider it? In my submission, it should not be done by this House on its own in the course of passing legislation. It should be done as the noble and learned Lord, Lord Simon of Glaisdale, proposed in his Motion; namely:
"That it is desirable that a joint committee of both Houses be appointed to consider the issues raised by the proposed new clause",
as set down in the name of the noble and learned Lord, Lord Hoffmann. I believe that that is right.
Should the matter come to a Vote, let me make my position clear. If the noble and learned Lord, Lord Hoffmann, insists on the new clause, I shall oppose it. I shall do so on the basis that, if his amendment is to fall, the House will be prepared to accept the Motion in the name of the noble and learned Lord, Lord Simon of Glaisdale.
I said that I would be brief and I have been. It seems to me that this is too important an issue to be dealt with in legislation in this way. It requires detailed consideration by a Select Committee of both Houses of Parliament. If the result of that consideration is that we should amend the Bill of Rights of 1689, so be it, and that can no doubt be done in a proper way.
Lord Renton: My Lords, I too can be brief. I have not discussed this matter with any member of the Government, although I am a keen supporter of the Government. I agree with what the noble and learned Lord, Lord Simon of Glaisdale, said and with the words of the noble Lord, Lord Richard. However, we have to acknowledge that the noble and learned Lord, Lord Hoffmann, with great care and thoroughness and obviously after giving the matter great thought, has drawn our attention to a conflict. It is a conflict between the constitutional necessity for having freedom of speech in all proceedings in Parliament and in committees of Parliament and the sense of justice in rare individual cases.
I served for some years on the Committee of Privileges of another place. As the noble and learned Lord, Lord Simon of Glaisdale, said, there were occasions when that committee had to consider the justice of a matter. In my

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experience, it reached sensible conclusions. I do not think that there was ever a case in which we had to consider the kind of conflict that arose in the case of Mr. Neil Hamilton. I should hope that after 300 years or more such cases would be extremely rare.
But there is one fundamental objection to the principle put forward by the noble and learned Lord, Lord Hoffmann. It is the only opinion that I wish to put before your Lordships. If Parliament said that parliamentary privilege could be waived in any case before the courts, in my opinion it is most likely that in such cases the person who might be asked to waive the privilege would be deemed under a moral obligation to do so. If that became the usual practice, then de facto, although not directly by law, we would do away with the privilege conferred by the Bill of Rights. So we must be very careful before we give a discretionary power on the part of the individual which could become by moral obligation a pressure and in that way indirectly alter a constitutional principle.
It is a constitutional principle which must not be altered without the very greatest care, if it is altered at all, I repeat that freedom of speech is fundamental to the working of democracy, especially to the working of the House of Commons. It also affects your Lordships, although in practice, over the centuries, it has not in fact done so. But, of course, your Lordships have a duty to consider the matter as we are doing this afternoon.
Lord Ewing of Kirkford: My Lords, I hesitate to follow the noble Lord, Lord Renton, who is such an experienced parliamentarian, and to dispute that freedom of speech is fundamental to the workings of Parliament, especially of the other place. However, it is my strongly held view that freedom of speech should be exercised with responsibility.
One of the developments in modern politics has been the way in which freedom of speech, protected by 100 per cent. parliamentary privilege, has been abused. Like the noble Lord, Lord Renton, I served for some considerable time in another place. Over the 25 years I have served in Parliament, I have become increasingly concerned about the blanket privilege protection that is enjoyed, particularly by those who serve in the other place. I was a member of the Procedure Committee when the decision was taken to televise the proceedings of another place. At that time I expressed the view that a Member of Parliament could rise in his or her place and make outrageous statements about members of the public, particularly local authority councillors, who were in no position to defend themselves against such allegations. Today, Tuesday, large numbers of people throughout the country will have watched the exchanges during Prime Minister's Question Time. It has become quite commonplace for Back-Bench Members on all sides of the House—I make no party political point here—to rise in their place and make such outrageous statements.
When I was a member of the Procedure Committee in another place I suggested at the time of the decision to televise its proceedings that there should be introduced some redress for those whose characters
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were maligned in that way by people who were using the protection of privilege in another place. In my time here I have seen privilege used constructively. Noble Lords may remember the Savundra affair, the great insurance scandal, of the early 1970s. That insurance scandal could not possibly have been exposed had it not been for the fact that Raymond Carter, a Birmingham MP, raised the matter under privilege from the Back Benches of the other place. So I have seen privilege used in a correct and constructive fashion, but I have also seen privilege abused in the most appalling manner.
While I support the proposal submitted by the noble and learned Lord, Lord Simon of Glaisdale, I should like to have seen the terms of that proposal extended to include not only a joint committee of both Houses of Parliament but also some constitutional experts who serve in neither House of Parliament in order to bring outside opinion and influence to bear on the proceedings of that investigation.
I know Neil Hamilton very well and I can claim with some confidence that he and I have been friends since he entered the House of Commons. I was already there when he came. However, we are not here today to discuss an individual's problems and concerns. We are discussing an issue of profound principle. Neil Hamilton was a Minister in the Department of Trade and Industry. He was not involved in any way, shape or form in the Matrix Churchill affair. But had he been, it is an astonishing fact that, like every other Minister at that time, he would have been in a position, advised by the Government's Law Officers, to issue a public interest immunity certificate to prevent the very examination that we are seeking to implement here today in the change to the Bill of Rights.
Ministers, advised by the Law Officers, are in a position to issue public interest immunity certificates to prevent the revelation of information. That is the dichotomy and contradiction with which we are all faced. In this case it is suggested that the courts should be given the power, by changing Article 9 of the Bill of Rights, to examine the conduct of a Member of Parliament—a Minister in this case—on the say-so of that individual. If that is the opinion of both Houses of Parliament, where then stands the citizen? Why should not the citizen have the right to go to the courts to ask them to investigate the parliamentary conduct of a Member of this House or of another place; or is it to be a one-way street? That is how this will be seen in the country at large.
I appreciate the frustration that is felt by Mr. Hamilton in his complaint against the Guardian but I do not agree with the proposal to change Article 9 of the Bill of Rights. Perhaps I may point out that the Bill of Rights would not apply to Scotland. The claim of right is the article of association that would apply to Scotland. The position at the minute is that the courts do not have the right to investigate the conduct of a Member of Parliament. It is suggested that we give them that right but that we do not give the individual citizen the right to ask the courts to carry out that same investigation. What kind of impression are we giving to the people of this country as we seek to reform the democratic process?

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If this matter comes to a Division I shall follow the advice of my noble friend the Leader of the Opposition and support the proposition put forward by the noble and learned Lord, Lord Simon of Glaisdale. I would hope that on the amendment that was moved so genuinely and ably by the noble and learned Lord, Lord Hoffmann—he has done the House a service by allowing us to discuss the matter—the opinion of the House will not be sought.
4.45 p.m.
Lord Aldington: My Lords, at this stage perhaps the House will bear with someone who wishes to support the noble and learned Lord, Lord Hoffmann. Not surprisingly perhaps to the House, I put first the fact that the honourable Member, Mr. Neil Hamilton, has decided to bring libel proceedings, a very considerable decision for anyone to take, in order to defend himself against an attack by a newspaper which has brought to a stop his ministerial career and must have damaged his career as a Member of Parliament. Having made that great decision and having decided to subject himself to the ordeal—it is an ordeal—of libel proceedings, he now finds that he has come to a dead stop. He can do nothing to remove from public knowledge an attack upon his character first made in a newspaper and now made in proceedings by justification. He can do nothing. We here appear to believe that to release him from the bar that puts a stay on the proceedings raises such implications of a constitutional nature that we are unable to back the noble and learned Lord's amendment.
The noble Lord, Lord Richard, gave valuable advice to the House, but I believe that he misdirected himself on one point. He referred to the amendment being "tacked on" to the Third Reading. The amendment was moved in Committee and at Report stage. I am sure that he would not wish to charge the noble and learned Lord with that.
Lord Richard: My Lords, the noble Lord is right as regards the procedure. Perhaps I may be forgiven for observing that, as I understand it, the amendment had been discussed by only four Members of your Lordships' House before today.
Lord Aldington: My Lords, I thank the noble Lord. It may have been discussed by only four noble Lords, but some of us were here who agreed with what had been said so we did not feel it necessary to add to it. Certainly, I was one of them. I hope that the House will consider carefully what the noble and learned Lord, Lord Hoffmann, said, bearing in mind the great authority which the noble and learned Lord, Lord Simon of Glaisdale, my noble friend Lord Renton and others, bring to our discussions, and that we shall get back in our minds to the problem of what is the right thing to do over what is manifestly an injustice.
These proceedings have been stayed and for so long as that is so, Mr. Neil Hamilton's character is stained. That is what happened to me, and that is why I can speak with some feeling. In my case the matter goes on and on and I am getting used to it. Mr. Neil Hamilton is not used to it. He is a much younger man and he has
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to face life with this charge sticking to him. Surely, this House, with its regard for justice, which means not only the privilege of Parliament but justice to the individual, will think again before dismissing the arguments of the noble and learned Lord, Lord Hoffmann.
Lord Lester of Herne Hill: My Lords, during the brief debate on the Bill at Report stage I expressed sympathy for the aim of the amendment in the name of the noble and learned Lord, Lord Hoffmann, which was tabled only shortly before the debate. After further reflection, I am now convinced that the amendment is flawed and would infringe fundamental principles of the constitution. I hope that your Lordships will bear with me if I explain why. It is for several main reasons.
First, contrary to the view of some of your Lordships, I believe that Mr. Neil Hamilton, whom the amendment was devised to assist and who has not pursued an appeal to the higher courts, would have reasonable prospects of success, as I shall explain. Secondly, the amendment is, as your Lordships have indicated, at odds with the protection given to parliamentary privilege by Article 9 of the Bill of Rights. Thirdly, it would operate arbitrarily. Fourthly, I believe that it would extend parliamentary privilege in a manner that would unnecessarily interfere with free speech. Fifthly, it would create new conflicts between Parliament and the courts of the kind we thought dead and buried a century ago. Lastly, it would authorise conduct that would infringe the European Convention on Human Rights.
In approaching the amendment I respectfully suggest that we would do well to heed the wise warning in the maxim, "Hard cases make bad law", to which I would add, bad constitutional law and bad constitutional practice. The fact that Neil Hamilton's case is a hard case should not lead us to act in a hasty way. In the Prebble case the noble and learned Lord, Lord Browne-Wilkinson, explained,
"The basic concept underlying Article 9 is the need to ensure as far as possible that a member of the legislature and witnesses before committees of the House can speak freely without fear that what they say will later be held against them in the courts".
He made it clear on behalf of the Privy Council that:
"The privilege protected by Article 9 is the privilege of parliament itself. The actions of any individual Member of Parliament, even if he has an individual privilege of his own, cannot determine whether or not the privilege of Parliament is to apply".
In the Prebble case, as the noble and learned Lord, Lord Hoffmann, observed, the Privy Council decided that parties to litigation cannot bring into question anything said or done in the House by suggesting that actions or words were inspired by improper motives or were untrue or misleading. The Privy Council said that such matters lie within the exclusive jurisdiction of Parliament.
It is significant—and it has not yet been mentioned—that nowhere in the Commonwealth has any other legislature or any member of any other legislature, so far as I am aware, sought to tamper with Article 9 in the wake of the Prebble case in the manner contemplated by this amendment. In my view it is most unfortunate that Mr. Hamilton did not appeal against the application of the Prebble case in the circumstances of his particular

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case because there is strong persuasive authority, not considered by the Privy Council, suggesting that the Law Lords might hold, if he did appeal, that he could pursue his libel action notwithstanding Article 9.
Without taxing the patience of noble Lords unduly, perhaps I may give one example. I have in mind the decision of the American Supreme Court in United States v. Brewster (1972) where it upheld the validity of an indictment of a former US senator alleging that he had accepted a bribe to be influenced in the performance of his official acts. The Supreme Court decided that although the American equivalent of Article 9 of the Bill of Rights protects members of Congress from inquiry into legislative acts or the motivation for the performance of such acts, it does not protect all conduct relating to legislative acts or motivation. The Supreme Court said that it was the taking of the bribe, not the act which the bribe was intended to influence, which was the subject of the prosecution. The court held that the "speech and debate" clause, which is equivalent to Article 9, imposed no obstacle for that type of prosecution. Chief Justice Burger observed that in Canada, as well as in Australia, courts have held that parliamentary privilege does not bar the criminal prosecution of legislators for bribery.
In my view it is very strongly arguable that if Mr. Hamilton had pursued an appeal, the Law Lords would have been persuaded by this reasoning—not only in the American case, but in others—to decide that Article 9 interposes no obstacle to an action based on a particular libel of which he complained since an allegation of accepting cash for asking questions in Parliament is quite different from the allegation in the Prebble case of making misleading statements to Parliament. In other words, I believe that Mr. Hamilton's case can readily be distinguished from the Prebble decision.
Noble Lords may think that if that is correct Mr. Hamilton should be pursuing his remedy in court rather than that we should have to consider such a grave and weighty constitutional amendment. In addressing the merits of the case, I believe that the amendment of the noble and learned Lord, Lord Hoffmann, goes much wider than the particular circumstances of Mr. Hamilton's case. In my opinion the amendment is plainly inconsistent with Article 9. It seeks—the noble Lord, Lord Renton, made the point—legislative authority for Parliament to surrender its vital collective privilege to any individual Member or anyone else who is a witness in defamation proceedings and whose conduct is in issue in those proceedings. It leaves entirely to the discretion of that Member or witness, or other individual, to decide whether to waive the protection given to Parliament by Article 9. I venture to doubt whether such a course can constitutionally be taken in accordance with Article 9 and in accordance with the law and custom of our constitution as observed over the past three centuries without the House itself deciding in each particular case whether or not to waive the collective privilege. However, that is what the amendment seeks to do by means of what is really a parliamentary equivalent of a sweepingly broad Henry VIII clause—ourselves acting in this sense as Henry VIII.
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I believe that the amendment is also inconsistent with the central purpose of Article 9 in another important way. Its very existence would mean, if it were enacted, that a Member who has been defamed will be under pressure to waive the collective privilege to vindicate his reputation. Furthermore, although the amendment purports to leave it to the discretion of the individual without affecting the operation of parliamentary privilege in relation to another person who has not waived it, that is not how it will work in practice, as several noble Lords have said.
Let us take the case, to which the noble and learned Lord, Lord Hoffmann, referred, of several Members being involved in the same matter. One decides to waive the collective privilege so that he can pursue a libel action. He is able to proceed with the action in that case only if he can persuade the others to waive their privilege; otherwise the court would stay the action on the ground that there cannot be a fair trial unless the relevant evidence, including the evidence of the other Members, is made available. That means that pressure will be brought to bear by one Member on another Member to waive privilege. Pressure of that kind undoubtedly undermines the collective protection of parliamentary privilege, and the very existence of the possibility of waiver by any one Member would deprive all Members of the confidence, at the time they speak, that they could be certain that there could not subsequently be a challenge in the courts to what they are saying.
I am sorry to say that I also think that the amendment would operate arbitrarily in several ways. In the first place, its operation would be entirely at the discretion of the individual Member or witness. Secondly, it could be waived entirely to further his own particular interest as a party to litigation. I take as an example the case of the Church of Scientology v. Geoffrey Johnson-Smith, as he then was. The plaintiff in that case sued Geoffrey Johnson-Smith for defamatory remarks made during a television interview outside Parliament. Geoffrey Johnson-Smith pleaded fair comment and privilege. To defeat that plea, the Church of Scientology pleaded that the MP had acted with malice, and it sought to adduce evidence, including extracts from Hansard, of what the MP had done and said in Parliament. The court refused to permit that because it would breach parliamentary privilege.
However, if the amendment were passed, a defendant would retain the option to use parliamentary privilege to shield himself in libel proceedings not only in respect of what he had said or done in Parliament, but also, as in the Johnson-Smith case, of what he had said or done outside Parliament. On the other hand, he would be given the new right, an entirely novel right, at his sole discretion, to waive privilege whenever it suited him, whether as plaintiff or defendant, in defamation proceedings. That would surely strike the other party to the libel proceeding, and the public at large, as an unfair extension of parliamentary privilege, inconsistent with its origins and primary purpose and arbitrary in its operation.
It would also unjustifiably interfere with free speech since a newspaper seeking to criticise an MP would have no way of knowing whether, or upon what basis,

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parliamentary privilege might be waived so as to permit the newspaper to establish the truth of fair criticisms of the conduct of elected Members in the performance of their legislative duties. That would have a serious impact on what the noble and learned Lord, Lord Browne-Wilkinson, described as,
"a most important aspect of freedom of speech, namely the right of the public to comment on and criticise the actions of those elected to power in a democratic society".
The amendment is arbitrary in another way, not yet referred to. It applies only to defamation proceedings, yet the reputation of an MP or other witness may be at stake in other proceedings, such as a criminal conspiracy trial, as in the Australian case of Hunt. I can discern no rational basis for permitting an individual waiver only in libel proceedings. If it were right to permit waiver by an individual, he should surely be permitted to waive the privilege to clear his name in the course of a criminal trial, say, for bribery or corruption.
As several noble Lords have said, the amendment would plainly result in the very vice, to which the Privy Council referred in Prebble, of reviving conflict between the courts and Parliament by allowing it to be suggested in cross-examination or submission that a Member or witness had lied to the House.
As it stands, the amendment would also unnecessarily chill free speech by allowing Members to pursue libel proceedings without there being qualified privilege, unlike the position in the United States, Australia, India, Pakistan, and Trinidad and Tobago. However, I recognise that that matter falls outside the scope of this amendment.
If this matter is to proceed further—I very much hope that it does not—I respectfully agree with the noble and learned Lord, Lord Simon of Glaisdale. However, I very much hope that after this debate the noble and learned Lord, Lord Hoffmann, will seek leave to withdraw the amendment. I believe that Mr. Hamilton should be left to pursue his legal remedies before the courts by way of appeal out of time. I also suggest that we should not subvert ancient and wise constitutional principles for the sake of a particular personal or political interest in litigation, however hard the case.
The immunities written into Article 9 were not included simply for the personal or private benefit of Members of either House but to protect the integrity of the legislative process by ensuring the independence of individual legislators. It was the culmination of a long struggle for parliamentary supremacy. I submit that it is as important as ever in protecting the independence and integrity of Parliament and should not be permitted to be undermined to meet the personal and private needs of particular individuals, however much we may or may not sympathise with the case.
Lord Clark of Kempston: My Lords, the House should be most grateful to the noble and learned Lord, Lord Hoffmann, for bringing this amendment before it. I have been influenced in this matter by the words of the noble Viscount, Lord Tonypandy. The noble Viscount was for many years a most successful Speaker of another place. One of his duties was to protect the interests of a Member of Parliament. He said previously that he was
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sympathetic to this amendment. I accept what the noble and learned Lord, Lord Simon of Glaisdale, said and that he has spoken to the noble Viscount—I am sure that we all wish the noble Viscount a speedy recovery from his illness—who said that the decision will, of course, be taken in the other place. If this amendment is passed, the matter will be discussed in the other place in any case.
I do not like the fact that the emphasis has been on the other place. As far as I can see, it could happen to a Member of this House. Consequently, I believe that both Houses are under a joint liability, if I may so put it. I believe that we should pass the amendment and let the other place look at it.
Having been in Parliament for well over 30 years, I am not all that keen on having more and more committees. The establishment of committees is invariably a delaying tactic—I am not suggesting that this will be—but the danger is there. Consequently, I do not think that we should set up another committee. I believe that this House is capable of, and has a constitutional right to, pass the amendment which can then go before another place. If we do not pass the amendment and if we do not say anything about the matter, how can the other place be given advice by this House? We should view the situation more from the parliamentary point of view.
I turn now to the Privileges Committee. That committee cannot possibly help Neil Hamilton in the circumstances. If a Member of Parliament commits a misdemeanour, the Privileges Committee can take action against him. In the past, the Privileges Committee has done just that. As the noble and learned Lord has said, that committee can suspend a Member for a Sitting, one week, two weeks or whenever. I congratulate the noble and learned Lord, Lord Hoffmann. This matter has been debated backwards and forwards. There is no point in going over all the arguments again. As a parliamentarian, I believe that this should be passed and that it should go to another place so that it can have another debate upon the matter.
Baroness Turner of Camden: My Lords, I should like to make a statement from the Back Benches on the matters under discussion this afternoon. Mr. Hamilton is not the only person involved in this affair. I declare my interest. I am a non-executive director of Ian Greer Associates. That brings me into category 2 of the recent Register of Lords' Interests. As I understand it, that means that I may speak upon matters relating to my interest but must declare it. I have some knowledge of the matters referred to here.
Your Lordships may be aware that over a period of three years the Guardian has conducted a campaign against this company, culminating in a series of serious allegations against it and the way it has conducted its business. The publication of these allegations was made without reference to Mr. Greer or his fellow directors. I believe the allegations to be totally without foundation. They also involve Mr. Neil Hamilton, MP, who, at the same time as Mr. Greer and IGA, sued the paper for libel. The allegations proved very damaging to a small and, until that time, successful company. They caused a sensation not only in the UK but internationally. The

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hurt and damage have been substantial. Fortunately, IGA had long-standing clients who did not believe the allegations and remained loyal. Nonetheless, business losses were sustained. As a result, IGA was forced to make some staff redundant. As a non-executive director, I receive a small fee, but during that period I did not accept it. I felt that I could not do so while the company had to lose staff.
Eighteen months on and after a lot of hard work things are beginning to turn around. The libel case that IGA brought against the newspaper was stayed on the grounds of parliamentary privilege. Therefore, the company has been denied access to justice. Mr. Greer as an ordinary citizen should have had the opportunity to clear his name by pursuing the action against the newspaper. He does not enjoy the rights that are afforded to Members of either House to speak in their own defence. In staying Mr. Greer's libel action on the grounds of parliamentary privilege, Mr. Justice May said that he was acutely aware that his decision might be perceived as a profound denial of justice to the plaintiffs (Mr. Greer and IGA).
Strangely enough, many newspapers commented on the injustice of the ruling. It was only right and fair that the Guardian should have had to try to prove the faults and damaging claims that it made. Surely it is wrong that newspapers should get away with making false allegations and then be able to shelter behind parliamentary privilege when asked to substantiate them in court.
I appreciate that there are serious constitutional issues involved here, as my noble friend Lord Richard has said. But it is unfortunate, to say the least, that ordinary citizens not protected by privilege should be caught up in a web of this kind and be unable to have their day in court. In view of my interest, which I have declared, I do not think it right that I should vote on this matter. Therefore, I propose to abstain. Nevertheless, I feel that the House should be made aware of the background to some of the issues that are being debated today.
5.15 p.m.
Lord Blaker: My Lords, I rise to support the amendment moved by the noble and learned Lord, Lord Hoffmann. I do so with enthusiasm, since I have been a victim of the problem with which the amendment seeks to deal. In 1990 when I was a Member of another place I was the subject of a libellous article in a well-known journal which alleged that I had broken the rules about the registration of Members' interests in 12 different respects. The article was erroneous in almost every particular. I was advised that, if a court were able to take a decision, I should certainly win, as far as anyone could be certain of anything in a defamation case. I was also advised that as soon as the case reached a comparatively early stage the Attorney General would intervene on grounds of breach of parliamentary privilege. Consequently, the case could very well be stayed.
I note what the noble and learned Lord, Lord Hoffmann, and other noble Lords have said about the paucity of similar cases in the past. In my case the
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situation was complicated by a case decided only a few months before the libellous article to which I have referred. I refer to Rost v. Edwards. That case also involved Members of the House of Commons and the Register of Members' Interests. In that case the learned judge decided that claims for privilege in respect of the register did not fall within the definition of proceedings in Parliament. He ruled that it was open to the plaintiff to give the evidence he wished regarding the registration of Members' interests and to the defendants to challenge that evidence. But there was a considerable body of opinion that that case had been wrongly decided and that, if I took my case further and the High Court followed the Rost case, the Attorney-General would take it to appeal and might very well win. Of course, anyone who opposed the case put forward by the Attorney-General in that situation would have to bear his own costs as well as those of the Attorney-General, which is not a very attractive proposition.
Therefore, I was in the same position as Mr. Neil Hamilton. I had no means of clearing my name. This seemed to me to be wholly unjust. I could not understand how the rule of privilege, which had been originally intended to protect freedom of debate in Parliament, could prevent a Member of either House of Parliament defending himself against a libel. Fortunately, in the event my action against the journal was settled, not on the terms which I believe would have been awarded had the case been decided by a court but at least on terms which included the payment of my costs and the publication of an apology. But I do not believe that that weakens the case for the amendment moved by the noble and learned Lord.
I agree with my noble friend Lord Clark of Kempston that the principle we are now discussing is equally important to this House as it is to the other place. It is true that cases of this kind have arisen more frequently in the other place, which is perhaps a consequence of the nature of the other place, but the principle is also relevant to this House. The noble and learned Lord, Lord Simon of Glaisdale, said that, if this amendment were passed, it would become part of a Government Bill and it would go to the other House as a Government Bill. Therefore, the voting on this clause (as it would then be) would be whipped. After 28 years in the other place, I am confident that there is no reason at all why a free vote should not be allowed in the other place as it has been allowed in this House on the matter. Now that the subject of the registration of Members' interests in both Houses has assumed greater prominence in the media than before, it is even more important that Parliament should do what it can to ensure that this wholly unjust situation does not arise again.
Earl Russell: My Lords, I have listened to this debate for some time. It is quite clear that no one in the House objects to the objects of the amendment moved by the noble and learned Lord, Lord Hoffmann. I believe that if it had been otherwise, the speeches of the noble Lord, Lord Aldington, the noble Baroness, Lady Turner of Camden, and the noble Lord, Lord Blaker, would have been sufficient to sway us. All I say about Mr. Hamilton is that we should vote on the assumption that what is

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his case today may be ours tomorrow. The argument is not whether something should be done but whether what should be done is this particular amendment.
Clearly, a person who is defamed should have a right to justice. The noble and learned Lord, Lord Hoffmann, said that there were no previous cases. However, there were cases before the passage of the Bill of Rights. In those cases, it was treated as a contempt of the House collectively. So the libeller or defamer was called before the House or its Committee of Privileges and accused of a contempt of the House collectively. That clearly was not a satisfactory procedure. It tended to create a sense of conflict between the House and an individual litigant—a sense of taking a hammer to crack a nut. We do not want to go back there, but if we do not go back there then the only reasonable alternative is access to the courts. But the question is whether access to the courts should be reached by means of this amendment. On that, my sympathies are with the noble and learned Lord, Lord Simon of Glaisdale. Like him, I am deeply concerned by what my noble friend Lord Lester of Herne Hill described as making a sort of Henry VIII clause of privilege with us in the capacity of Henry VIII, making over to the individual Peer or Member, as it were, almost the ownership of his privilege as if it were his.
The noble and learned Lord, Lord Simon of Glaisdale, is quite right: the privilege is that of the House, and it is that of the House because it exists in order to allow the Member to serve the House. On that, I venture to say that I cannot think of any of my academic colleagues on either side of the Atlantic who would disagree with the noble and learned Lord, Lord Simon of Glaisdale, and there are few subjects indeed upon which I could make that statement.
I shall though venture—if I may—to ask one small question about which I must be tentative, because it has arisen only since we came into the Chamber. The noble and learned Lord said that the privilege was that of the Bill of Rights. I wonder whether it is in fact an older privilege against suing and being sued, because, if it is so, as I suppose, then the case made by the noble and learned Lord, Lord Simon of Glaisdale, about waiving the privilege is very much strengthened because there are then plenty of precedents in favour of the case he advances, which is that the proper procedure is for the Member or the Peer to go to his own House and ask the leave of the House to waive the privilege.
The privilege is that of the whole House. Each House of Parliament is sovereign over its own proceedings, and, as I see it, it is not proper for any one but the whole House to attempt to waive its privileges. That is why I feel a grave doubt about putting statements about parliamentary privilege and parliamentary procedure into an Act of Parliament, because it has been clear, at least for 400 years, that neither House has any authority whatsoever over the privileges or the proceedings of the other. That is a jealousy guarded point. But what goes into a statute has the authority of both Houses. It, in effect, allows whichever House prevails in a disagreement to legislate a procedure for a ruling on privilege which may conflict with the wishes of the other. That is the tip of a very, very large wedge. I have
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no wish to see the House pass it. So I hope that we will think for a long time before inserting any such provision into an Act of Parliament.
So far as concerns Parliament, a resolution of each House in the relevant case is sufficient. Where we need to think more—the committee recommended by the noble and learned Lord is the right place to do it—is of the protection of the courts, because of course the House may waive its privilege but since that is not in an Act of Parliament it does not free the courts from the obligation laid down in the Bill of Rights. To do that, we need another and a different amendment, saying that the courts shall not be held to be in breach of the Bill of Rights in any case in which the relevant House of Parliament has chosen to waive its privilege. For that amendment, I would vote; for the amendment before the House at present, I regret to say that I would not.
Lord Peyton of Yeovil: My Lords, if I may be forgiven after an hour and 34 minutes of listening to this interesting debate, I should like to make just one or two observations. At the start, I felt a great deal of sympathy for Mr. Hamilton, who is a friend of mine. Having heard the noble and learned Lord, Lord Hoffmann, move his amendment, I must say that I was wholly convinced by it. That conviction has only been mildly shaken from time to time by those who have opposed it. If it comes to a Division, I shall therefore vote for it.
What seems to me to be odd, unpalatable, and very hard to accept, is that a privilege which was designed originally for the protection of Parliament and its Members should now have the wholly unintended effect of barring the access of one Member to the courts, that Member believing himself to have been seriously libelled. I need not go into that more than to say that he was obliged, as a result of the publication of that accusation, to resign as a Minister of the Crown. I know that sympathy for Mr. Hamilton has been expressed even by those who oppose the amendment, but I feel, nevertheless, that perhaps rather too much has been made of a minor change to a law which has stood for over 300 years. It does not seem too much to suggest, in the interest of justice to an individual, this modest change, which does not give him anything save that which is the right of every citizen of this country who feels he has been wronged.
Lord Pearson of Rannoch: My Lords, perhaps I may intervene briefly to support the amendment and to underline what has just been said by my noble friend Lord Peyton. I do so by asking a very simple question: what happens if we put ourselves in the position of those who drafted and passed the Bill of Rights, and ask whether they would have intended Mr. Hamilton to find himself in his present predicament thanks to their otherwise worthy endeavours? May I suggest that they would have been very disturbed? Those who drafted the Bill of Rights cannot have envisaged the public climate in which we live today. I hope that your Lordships will not think me flippant if I go further and suggest that they could not conceivably have been able to foresee the existence of the Guardian newspaper, or indeed of the rest of our modern media. It is perhaps for that reason that Mr. Hamilton's case, if not the first, is certainly one of the very early cases after 300 years of history.

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I am not a constitutional expert, but the amendment does not seem to me to go against the fundamental principles of the Bill of Rights. Indeed it appears to go with the wider implications and intentions of the Bill itself. It does not go against its priceless principles. I have listened to all the arguments put forward this afternoon by noble Lords who oppose the amendment, and I have to say that they strike me as somewhat administrative when set against the principles that we are debating. I have had the impression that some noble Lords who have spoken against the amendment have been standing the Bill of Rights on its head.
I am left with the letter which I received from Mr. Hamilton; indeed, I am sure that many noble Lords have received the same letter. I have heard nothing which goes against the urgency and obvious justice of his case, which is merely the right to have it heard before the courts. Therefore, I shall conclude by quoting to your Lordships what Mr. Justice May said when he very reluctantly stayed the case. He said:
"I am acutely conscious that staying the actions may be perceived as a profound denial of justice to the plaintiffs. The ability of all persons to come to the courts to have their disputes tried and determined fairly and according to law is a cardinal right upon which freedom under the constitution depends".
I support the amendment.
5.30 p.m.
Lord Campbell of Alloway: My Lords, I came to the House to support the amendment, but having heard the debate I am unable to do so, largely for the reasons given by the noble Earl, Lord Russell. I feel keenly about the manifest injustice of the situation and that is why I came to support the amendment. However, if by statute one starts to interfere with the privileges of Parliament, one is starting something which is of even greater consequence than an injustice.
Lord Beloff: My Lords, in supporting the amendment I wish to make one point. It is that we should remember the circumstances in which the Bill of Rights was drafted. It was intended to protect the two Houses of Parliament against the Executive. People could not then have forecast a time when we should suffer from a yellow press. Surely it is more important to look at how we protect citizens. Indeed, the noble Baroness, Lady Turner, reminded us that not only are Members of the two Houses involved and seek such protection. To impute some principle of non-intervention in the affairs of Parliament to the authors of the Bill of Rights is to go very far from historical truth.
The Lord Chancellor: My Lords, I am sure that all noble Lords are grateful to my noble and learned friend Lord Hoffmann for tabling the amendment, the way in which he moved it and the balance with which he presented it. All of us would expect that of him.
There is no doubt that the issue is difficult. As the noble Lord, Lord Richard, said, this is a House of Parliament legislating but it is a House of Parliament legislating as part of the parliamentary process. What we decide today is subject to the approval of the House
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of Commons before it becomes law. I believe that discussion of this matter in the House of Commons will be greatly assisted by the breadth of our debate today. I am sure that that was one of the purposes my noble and learned friend had in mind in presenting the amendment.
My noble friend Lord Campbell of Alloway confessed to having been swayed to change his mind by the speech of the noble Earl, Lord Russell. Therefore, perhaps it would be worth my while to say a word or two about that. The noble Earl made clear that it is impossible to remove the obstacle which Mr. Justice May and the Privy Council felt existed in cases of this kind without amendment of the Act of Parliament because the Act of Parliament creates the obstacle. No resolution of either House of Parliament of itself could do that. Therefore, the noble Earl, Lord Russell, towards the end of his remarks accepted that proposition and said that some form of parliamentary intervention is required in order that the court should be able to remove the obstacle.
As regards the amendment the Government are neutral; it is a matter for the House as a whole to consider. We would regard it as vitally important to have the opinion of the House of Commons, which is principally, although not solely, affected by the amendment, before reaching a view about it. I believe that the House of Commons would be able to consider the matter carefully if it came forward as part of a Government Bill. There is no intention whatever on the part of the Government that there should be anything other than a free vote on the matter in the House of Commons.
For the purposes of our discussion I assume that the decision taken was the correct one. The noble Lord, Lord Lester of Herne Hill, was moved to suggest that Mr. Justice May may have got it wrong and that an argument which was not put before the Privy Council might have affected its view. I believe that your Lordships must work on the basis of the judgments before you; namely, that of Mr. Justice May and of the Privy Council.
Lord Lester of Herne Hill: My Lords, I am grateful to the noble and learned Lord for giving way. Will he agree that, since Mr. Hamilton has not pursued his appeal to the Court of Appeal or to the House of Lords and since the Prebble case plainly does not deal with allegations of bribery but rather misleading statements in the House, it must be at least an open question as to whether the House of Lords would give as broad an interpretation to the Privy Council as did Mr. Justice May?
The Lord Chancellor: My Lords, it is always a question, which is why rights of appeal are granted, and these days only a fairly brave lawyer would forecast with 100 per cent. confidence a decision of a higher court. I am speaking about the decision for the purposes of our debate today. I am not saying that Mr. Justice May's judgment will stand for ever. A similar judgment was made in another case at about the same time by Mr. Justice Owen, but even two High Court judges would not necessarily determine the law for the future. Your Lordships will know that the House of Lords has not professed to do that. There is always a degree of the provisional in such matters. But for the sake of the present debate your Lordships must assume that the

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judgment of Mr. Justice May was correct, as was a similar judgment of Mr. Justice Owen in a similar case. That is my assumption in looking at the matter.
If those judgments are correct, the Act relating to England and Wales which created the obstacle to doing justice was created to protect the parliamentary process and that has turned out to be an obstacle to a Member of Parliament obtaining access to justice. That may be inevitable and certainly under the present law it appears to be inevitable. The question is whether Parliament should intervene to change it. All noble Lords have agreed that if the law has that effect the only way it can be changed is by the intervention of Parliament.
I accept immediately that the privilege created by the Bill of Rights as regards this aspect is a privilege of Parliament. It is not a privilege of individual Members of Parliament; it is a privilege of Parliament. However, the consequence of the existence of that privilege is the interposition of an obstacle to protecting themselves in the face of individual Members of Parliament. That may be a consequence of the privilege of Parliament, but it is an obstacle that the individual faces in seeking access to the courts in order to clear his name from what he believes to be a defamation.
The question is whether Parliament should do something about that. Two courses are open to your Lordships today. The first is to send the whole matter to a joint committee of both Houses, which of course would require the agreement of the other place. The second is to consider whether this amendment should be passed. Of course, there is a third possibility of doing nothing, but in the face of such an injustice your Lordships might not feel moved to do nothing. Therefore, the question is: what should be done?
To send the matter to a joint committee is not a solution but is a way of having the matter considered further by your Lordships, and there has been a fairly full debate today. I have no doubt that the whole of this debate will be available for all Members of the House of Commons who wish to take an interest in it.
If the amendment comes forward in a government Bill, it will have come forward as a result of an amendment moved by a noble and learned Lord from the Cross-Benches without the Government having a view upon the matter, and there will be a free vote.
It is said that resolutions of each House of Parliament are important in that connection. I agree entirely with that. It will be necessary for both Houses of Parliament to agree to the amendment before it becomes the law of the land. Therefore, it seems to me perfectly correct that the views of both Houses are taken independently and that the refusal of either House to agree to the amendment will cause it to fall.
And then it seems to me that it is right that the individual in whose path this obstacle to justice is placed in consequence of this particular immunity or protection should have the right to say that he does not wish that obstacle to remain in his path, if that is his wish.
Various points have been made in relation to this; for example, that pressure could be put on one Member to waive his privilege. At present there is the familiar
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invitation to a Member who makes a statement that he should come outside and make it again. That is a matter for the Member's discretion.
Lord Harris of Greenwich: It is not taken up very often.
The Lord Chancellor: My Lords, the noble says that that invitation is not taken up very often. The matter of waiver would be a matter for the individual Member of Parliament, and in relation to this amendment it leaves it open to the individual Member whether or not to exercise that waiver.
Assuming that the law laid down by Mr. Justice May and Mr. Justice Owen is correct, following Prebble, as they thought they were, anyone can defame a Member of Parliament in respect of that Member's participation in the proceedings of Parliament without that Member of Parliament having any possibility of obtaining redress in the civil courts for that defamation.
The noble Lord, Lord Lester of Herne Hill, who at an early stage was sympathetic to the amendment, has indicated some reasons against it: that it may prevent free speech and so on. The alternative is to leave unresolved the problem that a Member of Parliament can be defamed in respect of his central activities as he participates in the proceedings of Parliament without remedy in defamation which would be open to any ordinary citizen.
I believe that a sufficient case has been made for this amendment for your Lordships to consider carefully whether or not it should be part of the Bill when it goes to the House of Commons on the distinct understanding that this matter will have to be debated and considered very carefully in the House of Commons before this remedy is afforded. I am not aware—and I have not been made aware in the course of this afternoon—of any other solution which is likely to be effective. Those matters are for your Lordships to consider.
As I said, the Government's view is that this should be an entirely free vote. That is the position that we shall adopt in relation to this matter. My personal view is that it is right for your Lordships to give the House of Commons an opportunity to consider it.
The Earl of Balfour: My Lords, I should like to ask one question of my noble and learned friend the Lord Chancellor. If we do vote against accepting the amendment, does another place have an opportunity to discuss it?
The Lord Chancellor: My Lords, it would be open to a Member in another place to table such an amendment which would then be discussed there. The advantage of this amendment is that it comes from a completely independent source; namely, it was moved by my noble and learned friend Lord Hoffmann from the Cross-Benches. As my noble friend will know, there are no Cross Benches in another place.
Lord Renton: My Lords, I wonder whether my noble and learned friend the Lord Chancellor will deal with one very important point. This amendment deals with waiver of parliamentary privilege and protection in

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defamation proceedings only. But of course, if the matter can arise in relation to defamation proceedings, may it not arise also in relation to proceedings for breach of contract, especially if fraud is alleged, and in other kinds of proceedings including criminal proceedings?
The Lord Chancellor: My Lords, this Bill deals with defamation. Therefore, I submit to your Lordships that it is proper to deal with this only, if at all, in the context of defamation. This Bill does not allow us to deal with a whole range of proceedings. But your Lordships may well feel that in relation to an important matter of this kind, it may well be right to proceed in stages. This Bill has provided an opportunity to raise this matter in relation to defamation, which was after all the subject matter of the cases giving rise to the problem. When a Bill dealing with that very subject matter is before the House, it might be appropriate to deal with that aspect at least.
Lord Hoffmann: My Lords, I said when moving the amendment that I did not see my role as that of an advocate for the amendment but rather to put the matter before your Lordships for debate. Therefore, I trust that your Lordships will not think it any discourtesy if I do not reply to the points made during the debate.
I have listened with great respect to the arguments which have been made against the amendment. On the other hand, it is clear that there are noble Lords who are in favour of it. In those circumstances, it would be wrong not to test the opinion of the House. I commend the amendment.
5.48 p.m.
On Question, Whether the said amendment (No. 4) shall be agreed to?
Their Lordships divided: Contents, 157; Not-Contents, 57.

Division No. 1

CONTENTS

Abercorn, D.

Bridges, L.

Ackner, L.

Broadbridge, L.

Addington, L.

Bruce of Donington, L.

Addison, V.

Bruntisfield, L.

Ailsa, M.

Butterworth, L.

Aldington, L.

Cadman, L.

Allenby of Megiddo, V.

Carnegy of Lour, B.

Ampthill, L.

Carnock, L.

Archer of Weston-Super-Mare, L.

Carr of Hadley, L.

Ashbourne, L.

Cayzer, L.

Astor of Hever, L.

Chalker of Wallasey, B.

Barber of Tewkesbury, L.

Chelmsford, V.

Beaumont of Whitley, L.

Clanwilliam, E.

Belhaven and Stenton, L.

Clark of Kempston, L.

Beloff, L.

Coleridge, L.

Bethell, L.

Courtown, E.

Blaker, L.

Crickhowell, L.

Blatch, B.

Cross, V.

Blyth, L.

Cumberlege, B.

Boardman, L.

Dean of Harptree, L.

Bowness, L.

Devonshire, D.

Brabazon of Tara, L.

Digby, L.

52

Dilhorne, V.

Masham of Ilton, B.

Dixon-Smith, L.

Merrivale, L.

Donaldson of Kingsbridge, L.

Meston, L.

Dubs, L.

Miller of Hendon, B.

Elles, B.

Monson, L.

Erne, E.

Moran, L.

Exeter, Bp.

Mottistone, L.

Ezra, L.

Mountevans, L.

Freyberg, L.

Munster, E.

Gardner of Parkes, B.

Nicol, B.

Geddes, L.

Northbrook, L.

Geraint, L.

Orr-Ewing, L.

Gisborough, L.

Oxfuird, V.

Glenarthur, L.

Park of Monmouth, B.

Gormanston, V.

Parkinson, L.

Goschen, V.

Pearson of Rannoch, L.

Gray of Contin, L.

Peel, E.

Grimston of Westbury, L.

Pender, L.

Halsbury, E.

Perry of Southwark, B.

Hamilton of Dalzell, L.

Peyton of Yeovil, L. [Teller.]

Hardinge of Penshurst, L.

Plummer of St. Marylebone, L

Hardwicke, E.

Prior, L.

Harmar-Nicholls, L.

Prys-Davies, L.

Harris of High Cross, L.

Rankeillour, L.

Harvington, L.

Rawlings, B. [Teller.]

Henley, L.

Rees, L.

Hesketh, L.

Renfrew of Kaimsthorn, L.

Hope of Craighead, L.

Rennell, L.

Howe, E.

Renwick, L.

Howie of Troon, L.

Rochester, L.

Jeffreys, L.

Rodney, L.

Jenkin of Roding, L.

St Davids, V.

Johnston of Rockport, L

St. John of Bletso, L.

Kilbracken, L.

Sandwich, E.

Kinnoull, E.

Seccombe, B.

Kintore, E.

Sharples, B.

Knutsford, V.

Skidelsky, L

Lawrence, L.

Stoddart of Swindon, L.

Leigh, L.

Strafford, E.

Lindsay, E.

Sudeley, L.

Lindsey and Abingdon, E.

Taverne, L.

Liverpool, E.

Taylor of Gryfe, L.

Lloyd-George of Dwyfor, E.

Teynham, L.

Long, V.

Thatcher, B.

Longford, E.

Thomas of Gwydir, L.

Lucas, L.

Thomson of Monifieth, L.

Lucas of Chilworth, L.

Thurlow, L.

Lyell, L.

Tollernache, L.

McColl of Dulwich, L.

Trumpington, B.

McConnell, L.

Vivian, L.

Mackay of Ardbrecknish, L.

Westbury, L.

Mackay of Drumadoon, L.

Wharton, B.

McNair, L.

Wilberforce, L.

McNally, L.

Wilcox, B.

Mallalieu, B.

Wrottesley, L.

Marlesford, L.

Wyatt of Weeford, L.

Young, B.

NOT-CONTENTS

Balfour, E.

Gould of Potternewton, B

Berkeley, L.

Graham of Edmonton, L.

Blease, L.

Greenway, L.

Boyd-Carpenter, L.

Hamwee, B.

Campbell of Alloway, L.

Harris of Greenwich, L.

Carmichael of Kelvingrove, L.

Haskel, L.

Carter, L.

Hemphill, L.

Clinton-Davis, L.

Hollis of Heigham, B.

Craig of Radley, L.

Hughes, L.

Dormand of Easington, L.

Hylton-Foster, B.

Eatwell, L.

Jeger, B.

Erroll, E.

Jenkins of Putney, L.

Ewing of Kirkford, L.

Kilmarnock, L.

Farrington of Ribbleton, B.

Kimball, L.

Gladwin of Clee, L.

Lester of Herne Hill, L.

Glenamara, L.

Lockwood, B.

53

McIntosh of Haringey, L.

Saltoun of Abernethy, Ly

Mackie of Benshie, L.

Seear, B.

Merlyn-Rees, L.

Shaughnessy, L.

Monkswell, L.

Simon, V.

Morris of Castle Morris, L.

Simon of Glaisdale, L.

Palmer, L.

Skelmersdale, L.

Rea, L.

Stedman, B.

Redesdale, L.

Stodart of Leaston, L.

Renton, L. [Teller.]

Strange, B.

Richard, L.

Weatherill, L.

Robson of Kiddington, B.

White, B.

Russell, E. [Teller.]

Williams of Elvel, L.

Wise, L.

Resolved in the affirmative, and amendment agreed to accordingly.
5.58 p.m.
Clause 14 [Reports of court proceedings absolutely privileged]:
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 6 and 7:
Page 11, line 3, leave out ("and").
Page 11, line 4, at end insert (", and
() any international criminal tribunal established by the Security Council of the United Nations or by an international agreement to which the United Kingdom is a party.").
The noble and learned Lord said: My Lords, I spoke to the above amendments when moving Amendment No. 1. Therefore, with the leave of the House, I beg to move Amendments Nos. 6 and 7 en bloc.
On Question, amendments agreed to.
Clause 18 [Extent]:
Lord Hoffmann Lord Hoffmann moved Amendments Nos. 8 to 10
Page 12, line 13, at end insert—
("section (Evidence concerning proceedings in Parliament) (evidence concerning proceedings in Parliament),").
Page 12, line 27, at end insert—
("section (Evidence concerning proceedings in Parliament) (evidence concerning proceedings in Parliament),").
Page 13, line 3, at end insert—
("section (Evidence concerning proceedings in Parliament) (evidence concerning proceedings in Parliament),").
The noble and learned Lord said: My Lords, these amendments are consequential on Amendment No. 4. I beg to move Amendments Nos. 8 to 11 en bloc.
On Question, amendments agreed to.
Clause 19 [Commencement]:
Lord Hoffmann Lord Hoffmann moved Amendment No. 11:
Page 13, line 22, at end insert—
("section (Evidence concerning proceedings in Parliament) (evidence concerning proceedings in Parliament),").
On Question, amendment agreed to.
Schedule 1 [Qualified Privilege]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 12:
Page 16, line 50, after ("Rights,") insert—
("() any international criminal tribunal established by the Security Council of the United Nations or by an international agreement to which the United Kingdom is a party.").
The noble and learned Lord said: My Lords, I spoke to this with Amendment No. 1. I beg to move.
On Question, amendment agreed to.
On Question, Bill passed, and sent to the Commons.

Cattle Disposal Scheme
6 p.m.
The Parliamentary Under-Secretary of State, Scottish Office (The Earl of Lindsay): My Lords, with the leave of the House, I shall now repeat in the form of a Statement the Answer to a Private Notice Question which has been asked in another place on what progress has now been made in giving effect to the 30-month cattle disposal scheme and whether a Statement will be made.
"Slaughtering started in Scotland on Friday and elsewhere in the UK today. Some 104 livestock markets and some 72 abattoirs have been approved as collection centres. I anticipate substantially increasing activity as the week proceeds and see no reason why the scheme should not be fully operational by the end of this week. I have made it clear that all operators in the meat business will have to work together to make the 30-month cattle scheme a success. I met representatives of livestock markets together with a number of abattoir representatives this morning. I am seeing the renderers tomorrow.
"These are the crucial steps in the chain. Large numbers of animals have to be processed and I will need to ensure that this is done as speedily as possible so that farmers can have surplus stock off their fields and quite reasonably be paid compensation as quickly as possible. At all times we have to have regard to the welfare of the animals concerned and the need to restore consumer confidence. This scheme is being put in place as part of a number of measures to help restore confidence in British beef; it is a novel scheme without precedent and we have sought to set it up with all possible speed.
"Farmers, livestock markets, abattoirs and renderers have to work together—they do so normally and they have to do so now. I intend every day to see representatives of all the main interests to deal with any problems that might arise, but hope that it is not long before the scheme no longer requires daily ministerial involvement. Farmers will, I am sure, recognise that there are a large number of animals that have to he culled and that they cannot all be culled immediately. As the House will know, there is finite rendering capacity, so I am examining with all speed whether and what possible further cold store capacity can be brought into play to help accelerate the scheme.
"I well appreciate the concerns of everyone in this House that this scheme operates fully and efficiently without delay. I promise to keep honourable Members regularly updated on progress and am determined that this scheme will make a positive contribution to our wider aim of restoring confidence in British beef as speedily as possible".
My Lords, that concludes the Statement.
6.3 p.m.
Lord Carter: My Lords, I thank the Minister for repeating the Statement that was made in another place. I declare an interest as someone who is involved in dairy farming. Tomorrow it will be seven weeks since the first Statement was made on this matter. How many cattle have been slaughtered so far? The Minister said that the scheme will be up and running by the end of this week. Does he mean that the slaughtering will take place at the rate of 20,000 per week by the end of this week, which is of course the normal slaughtering figure? Is the Minister also aware of the statement made today by the chairman of Unilever that the BSE fiasco is in the UK and not in Europe and that the answer has to be found in the UK?
Last Friday Farmers Weekly referred to chaos and shambles. There are also reports that the Meat Hygiene Service does not have enough qualified staff to deal with the matter. Can the Minister tell the House what is happening with the proposed exemptions from the slaughter scheme? I am sure he knows that this is extremely important for beef farmers who are producing prime beef which has had no exposure to BSE. As I understand it, at the moment they are still caught by the scheme. We were told some time ago that there would be an exemptions scheme. Can the Minister tell the House what is happening as regards the exemptions scheme?
As part of the slaughter disposal, what has happened to the selective slaughter scheme that was proposed as a bargaining counter in Brussels but was rejected? Most farmers, who are aware that they would be affected by this selective slaughter scheme if it were introduced, are now in limbo. They do not know what will happen. Is the scheme to be revived? Is it a part of the carcass disposal scheme? Is it to be left on the table as a bargaining counter for months until it is decided in Brussels and Luxembourg what it is proposed to do about the export ban? If the Minister could explain what is happening over that scheme, that would be extremely helpful.
On today's early morning farming programme and today in the Statement the Minister of State, Mr. Baldry, proudly announced that now—I believe it will start tomorrow—there will be a daily meeting with all the various interests involved, including the NFU, the CLA, the renderers, the slaughterers, the meat wholesalers and the rest. But we have had to wait seven weeks for this to happen. Why did this not happen on day one? Is there no contingency planning in MAFF or in the Department of Health?
We still have the problem of the feed ban. Some 27,000 animals have been born since the feed ban was introduced. The Minister's noble friend Lord Lucas confirmed in a previous Statement that there has been some malpractice either on farms or in the feed mills, or both. What action do the Government propose to take on this matter? It is clear that the feed ban has been transgressed; otherwise there would be much more serious and more worrying questions about the 27,000 animals which have been born since the ban was introduced. If the Government admit that there has been a substantial transgression of the feed ban, will the Minister tell the House what action they propose to take?
56
My honourable friend Dr. Gavin Strang has asked for an inquiry into the matter but the Government have rejected that. What alternative action is proposed? We are not being wise after the event. In 1990 we as an Opposition asked for the banning of the use of ruminant protein in all forms of animal feed, not just in ruminant feed but also in pig and poultry feed. That was rejected by the Government six years ago. Now they have introduced the measure, but the effect of their rejection six years ago is the problem of the 27,000 animals which have been born since the ban was introduced. I remind the House that the Prime Minister told my right honourable friend the Leader of the Opposition only last Thursday that the confusion surrounding this scheme was being examined and investigated and that he hoped that it would be resolved speedily. We can all agree with that, but if we have to go by what has happened so far, it will not be quick.
Does the Minister accept that it is vital that we stop BSE at source? As I said, there must be an investigation into why 67 per cent. of new BSE cases are now in cattle which were born after the ruminant feed ban. As hundreds of thousands of older cattle—perhaps up to 800,000—are to be destroyed under this scheme, does the Minister agree that a live test for BSE has become all the more important and that, if there were any delay on the part of the Government in the establishment of such a test, that would be unforgivable? Having taken the decision that there would be both a live and a deadweight option for the 30-month rule, I should point out to the Minister that it is the duty of the Government to ensure that the compensation arrangements are fair not only to farmers but also to the other sections of the meat and livestock industry and to taxpayers.
We all want to see the lifting of the export ban, but I hope that the Government will accept that we have to restore confidence to consumers—not just consumers in this country but consumers in Europe—but also to our European partners if we are to get the export ban lifted. I suggest that what has happened so far does not exactly give anyone confidence. Last week I asked a Starred Question about the use of the Food Safety Act, which requires the Government to show an imminent risk to public health before introducing a slaughter policy at all. We are told constantly that beef is safe, so where is the imminent risk to public health? I understand that there is now to be a legal challenge to the whole of the slaughter policy from the beef trade on the basis of the use of the Food Safety Act. Perhaps the Minister will comment on that.
The NFU has approached first the British courts and now, I understand, the European Court of Justice. The Government have said constantly that they are proposing to challenge the ban in the European Court of Justice. I suggested here last week that they should use Article 186 of the treaty to seek interim relief. Will the Minister say when the Government propose to start proceedings in this matter?
We now have 120,000 cattle stacked on farms waiting for the scheme to get under way. All the parties involved wonder what they are supposed to do and how they are to be paid. Our European partners await clear policies to show that the eradication of BSE is being substantially

57
speeded up. The whole morass is overlaid by actual or potential appeals to national and European law. The Government must get hold of the problem and give clear leadership. If they do so, we shall certainly support them.
6.10 p.m.
Lord Mackie of Benshie: My Lords, I shall not repeat all the admirable arguments put forward. However, after seven weeks it does not look as though we are getting on as well as we should have done had the planning been right.
Certain facts are worth repeating. We know that without doubt the great spread of BSE in Britain has been due to feed. Since that time we have slaughtered 160,000 animals. However, from all quarters we have indications that the ban on the use of SBO rendered bonemeal has not been effective. The Government have to make up their minds to set in motion a sensible plan to accelerate the decline of BSE in this country.
Many of the proposed measures appear reasonable if they are put into effect. The capacity of the industry—whether that of renderers, or as regards total destruction through large premises—has to be the limit to which we stick. I do not believe that the Government should bargain with Europe. If they have a sensible plan to tackle the problem—by eliminating the obvious cases, using the 30 months scheme with sensible exceptions, and so on—they should stick to it.
On the Government's own admission they are not sure whether BSE can be passed on through the mother or by proximity. They hedge their bets. As regards heavily affected BSE dairy herds, there is no doubt that in order to give confidence a policy of slaughter in those herds might well be followed.
The Government should stick to their guns, apply those guns with a reasonable aim, and get things going. After seven weeks a lot of confusion exists. The Minister must have read all the farming press. Every single publication wonders what the devil is happening and is not satisfied that a competent scheme is in being.
One of the long-term factors is that without doubt manufacturers of cattle food should have to state the content on the bag. A number of these factors stick out a mile. The next two weeks will be absolutely vital. However, at present it does not look as though the farming community knows where it is going or where the Government are going, and whether all the matters to which the noble Earl referred, such as compensation, and so on, will be applied. I await with interest what the Minister has to say.
The Earl of Lindsay: My Lords, I can say to the noble Lord, Lord Mackie, that we fully understand why the farming press and farming community seek answers to some of the aspects of the schemes, especially the 30 month scheme which is a massive scheme. It poses immense logistical problems. It is a scheme where we have pre-empted and anticipated many of the problems that would arise. But inevitably the scheme is throwing up other teething problems. We are in the business of solving those problems as soon as they are identified. However, the scheme is worth between £500 million and £600
58
million to the farming community in its first year of operation. It is absolutely vital both to the farming community and to consumer confidence. It is unprecedented. The scheme seeks to reverse the usual flow of the industry. The industry seeks to produce beef for consumption. This scheme seeks to remove that beef from the consumers' market. Therefore, no one should underestimate the challenge that the scheme poses and the effort involved in getting it into place.
I accept that the farming community, and tens of thousands of livestock farmers, seek answers to questions. Across the United Kingdom they have all received letters, in some cases two letters, from the relevant ministries. The farming press has carried advertisements from the relevant ministries. We have provided helpline numbers, and so forth. We are determined that farmers have the information and that we solve the problems.
I will not accept from the noble Lord, Lord Carter, that this is a UK fiasco or that there is a lack of leadership.
Lord Carter: My Lords, it was the chairman of Unilever who said that. All I did was to repeat what he said.
The Earl of Lindsay: My Lords, the noble Lord repeated it. If he seeks to ignore the European dimension of this saga, he is fooling himself and possibly others in the House. The domestic beef market is back to over 80 per cent. of its pre-crisis levels across many areas. It is the export ban which has caused so much chaos in terms of consumer confidence over a wider area. There is not a shred of scientific justification for the ban. It is unprincipled. It is disproportionate. I resent the fact that the noble Lord continues to apologise for the ban and refuses to condemn or deplore it. We think that the ban is worthy of action in the European Court. I have explained that it has no scientific basis whatsoever. It has done untold damage across the European markets. The German market is down 50 per cent. at the moment; the Portuguese market is down 80 per cent. It is that ban, introduced without any logic whatsoever, which has done a huge amount of damage.
We are producing the staff and resources for the MHS. We are consulting at present on the exemptions; we went out to consultation on Friday. We are pursuing an important initiative. We are consulting with the industry on the selective slaughter scheme. I remind the House that the commissioner himself called it logical and rational, and felt that there was no credible alternative. However, agriculture Ministers in other European countries did not share the good sense of the commissioner. That remains on the table. We shall continue to negotiate from that position.
If we proceed with that or any other scheme we shall do so only with the agreement of Parliament, the industry and our own veterinary scientists. We shall not depart on some sacrificial route simply to appease European feelings.
The noble Lord, Lord Carter, suggested that the announcement made by my honourable friend the Minister of State in another place about daily meetings with the industry is somewhat tardy. All four agriculture departments have consulted and liaised extremely closely with their industries throughout the BSE crisis. My

59
honourable friend announced today that in England he would have daily meetings to ensure that the 30 months scheme was running as well as possible.
In Scotland, as in the other territories, we have had very good relations with the industries involved. On Friday, we killed 100 cattle under the 30 months scheme. We expect to kill 500 today. I do not have with me the figures for the other territories. However, I repeat what my honourable friend said in another place: that by the end of this week the scheme should be up and running.
The vital figures which neither noble Lord should forget, especially when addressing the subject of cases in cattle born after the ban and the possibility of a feed inquiry, are those which illustrate how steeply incidences of BSE are declining in the United Kingdom. I can give the noble Lord, Lord Mackie, the Scottish figures immediately. In 1993 we had 2,200 cases. By 1995 we were down to 600 cases. This year we anticipate just 300 cases. The same rate of decline has been recorded across the United Kingdom.
Referring specifically to born-after-the-ban cases, 84 per cent. of all such cattle were born in the second half of 1988 and during 1989. Only 3,140 animals born in 1990 became born-after-the-ban cases. That figure has fallen; only one calf born in 1993 became a born-after-the-ban case. Therefore, the trend is very steeply downwards. That is why we must approach any selective slaughter scheme with great care.
The noble Lord, Lord Mackie, suggested that we ignore the European dimension of the proposal and go ahead with it on a unilateral basis with no linkage to European negotiations. Our own veterinary scientists say, and the SEAC advice is, that the rate of decline of BSE in this country is so fast anyway that in terms of human or animal health there is no need to supplement it with this proposal. However, given the importance of the European diplomatic challenge and of removing the ban, it is worth considering a logical supplement. That is what characterises the selective slaughter proposal currently on the table.
I address my last point to the noble Lord, Lord Mackie. The export ban is having a disproportionate effect in Northern Ireland and Scotland. It is vital that we use any means possible to remove it. If there is leverage in a selective slaughter proposal, we should use it.
Lord Mackie of Benshie: My Lords, before the noble Earl sits down, the noble Lord, Lord Carter, asked an important question about the exceptions to the 30-month scheme. What progress has been made in dealing with the Galloways, Highland cattle and so on?
The Earl of Lindsay: My Lords, I answered the question but briefly and at speed. The consultation document went out to the farming industry on Friday 3rd May. We regard it as being an absolute priority for the specialist breeds which may be grass-fed and herds which fall into the category of never having been connected with a case of BSE during the past six years. There is a strong case for exemptions being awarded rapidly and we regard it as an urgent priority.
Lord Boyd-Carpenter: My Lords, my noble friend referred to the ban on exports being challenged in the European Court. Has that challenge been put in? If so, when is it expected that it will be heard by the European Court? I shall be grateful if my noble friend could answer that and also give whatever estimate the Government have of the number of animals that will be slaughtered as a result of the cull.
The Earl of Lindsay: My Lords, as regards the ban, we are launching our action within a matter of days. I cannot inform my noble friend with any accuracy of the likely timetable that will be pursued within the Court. However, as soon as it becomes known I hope that both my noble friend and the House will be informed. As regards the number of animals involved in the proposed selective cull, to which my noble friend referred, the approximate figure at the moment is 42,000. We regard those 42,000 cattle as being at the highest risk of contracting BSE at a later date. If, at any stage, there are developments in finding a live test through technology, it will pre-empt the need for selective culls and other programmes which involve the culling of cattle.
Lord Monkswell: My Lords, I thank the Minister for repeating the Statement. I rather regret the attitude that continues to come across from the Government of seeming to blame Europe for all their problems. We need to recognise that there is to a great extent a lack of knowledge and therefore difficulty in deciding who is right, who is wrong and what action should or should not be taken. One area where we are not faced so much with that problem is the feed ban. It was, I understand, a legal requirement on the feed industry to stop using SBOs in feed production. That is a legal requirement. Last week we were told by the Minister that the ban appeared to have been broken and that contaminated animal feed stuffs—cattle feed—have been supplied. First, what powers do the Government have to seek financial redress, whether by fines or levies on the feed industry, to recover the public moneys expended in dealing with the problem so far? The number of animals which have succumbed to BSE over the past five or six years is enormous and the cost to the Exchequer significant. What powers do the Government have to obtain financial redress from the feed manufacturers? Secondly, what steps are the Government taking to ensure that they extract money from those companies which presumably made significant profits because of their illegal activities over the past five or six years?
The Earl of Lindsay: My Lords, in regard to the 30-month cattle disposal scheme, those in this House who saw how the Speaker controlled the other place during the discussion will realise that she kept the House firmly focused on the question. The noble Lord, Lord Monkswell, has gone wide of the subject in his remarks; nevertheless I shall answer them. We do not necessarily seek to blame Europe in isolation of all other factors that pertain to the case. However, the fact is that the ban was imposed without any scientific evidence. It was imposed world-wide on our exports. We feel that that is of doubtful legality. So, both in terms of the science and of the injustice of such a move, we have strong feelings.

61
As regards SBOs and feed production, I remind the noble Lord of what I said to the noble Lords, Lord Carter, and Lord Mackie. With the incidence of BSE reducing so significantly, it is clear that the regulations on SBOs and feed have broadly worked. However, the SEAC recommendations of late March recognised that it was doubly important to ensure that it was not possible for ruminants to gain access to SBO protein in their food. Therefore, in case there had been leakage in the feed mills or on farms where farmers were running both ruminants and non-ruminants, it was decided that all livestock feed should exclude SBOs as a constituent. If any feed company is found to fail to comply with any regulations, then prosecutions will be considered. It is simple.
Lord Stodart of Leaston: My Lords, can my noble friend say whether it is true that, as has been suggested, exemptions could be made on a regional basis? Is there any possibility of that idea being taken up, particularly for the part of the country for which he is personally responsible?
The Earl of Lindsay: My Lords, despite the obvious incentive for an agriculture Minister from Scotland to seek an exemption for Scotland, there is no basis on which we can logically hope to claim a regional exemption at the moment. Both the farming industry and we ourselves realise, as is confirmed by veterinary scientists, that the incidence and pattern of BSE in Scotland are such that we cannot convincingly defend a regional exemption.
What we can hope to achieve through more specific exemptions, such as those based on specific herds, is that a wide area of Scotland can become exempt. If we approach exemption on those criteria, we can defend it to our critics; we can defend it to those in the media who might perhaps seek to debunk any part of the UK seeking exemption. There is a strong basis on which we can defend such an action. The farming unions have looked very closely at that, and we are as one on the subject.
Lord Monson: My Lords, will the Minister agree that, unlike many on the Continent, British consumers are to be commended for not being hysterical hypochondriacs in this matter, given that beef sales here are only 20 per cent. down as compared with 50 per cent. in many parts of the Continent?
The Earl of Lindsay: My Lords, I commend British consumers for being so resolute in the face of the hysteria that has swept through some areas. Much of our beef market is up to 85 per cent. of pre-crisis levels. We welcome back the Wimpy burger chain—although we do not feel that it should have left in the first place. Its return to buying British beef is a welcome move. As the noble Lord said, there are other domestic markets in Europe which are suffering losses at the moment in excess of 50 per cent. of their usual domestic beef purchase levels.
Lord Beaumont of Whitley: My Lords, I believe I heard my noble friend Lord Mackie of Benshie say that it stood out a mile that we should go ahead with the
62
labelling of feedstuffs. I did not hear the Minister reply to that. Perhaps he thought it a little wide of the Statement. But it is an extremely important point. Perhaps the Minister will say what the Government are doing in that respect.
The Earl of Lindsay: My Lords, we agree with the noble Lord that the labelling of feedstuffs is absolutely vital, as indeed are the constituents. We therefore expect the labelling to indicate to the farmer what is in the product that he purchases for his animals.
Lord Hughes: My Lords, I hope the Government manage to get a speedy decision from the Court, particularly as regards the worldwide ban. On first examination that seems to go far beyond any power that the Union could have. There is much criticism of the action taken by the European Union. However, we must remember that this disease has prevailed for nearly 10 years in large numbers of cattle in this country. We can hardly say that Europe acted terribly precipitately when it put the ban into operation. That does not mean that I differ in any way from the views of the Government in trying to get the ban lifted as soon as possible.
My noble friend Lord Carter spoke about the number of animals that had been born infected during a period when it was assumed that there was no feeding of the wrong material. The noble Lord, Lord Mackie of Benshie, mentioned two possibilities. He suggested that the disease could be passed from mother to calf; he also suggested contagion as a possibility. Do the Government accept those as possibilities? If so, what examination is being undertaken of that aspect of the matter?
The Earl of Lindsay: My Lords, I am grateful that the noble Lord, given where he sits in the House, is prepared to condemn the worldwide element of the European ban. The noble Lord, Lord Carter, and myself have now been through six or seven Statements. I keep waiting for the noble Lord, the Opposition spokesman on agriculture in this House, to deplore or condemn the ban in the same way as his noble colleague did.
Lord Carter: My Lords, in a debate in this House on 17th April, my noble friend Lord Richard and I pointed out that, under the directive, the ban was illegal. We pressed the Government to take action. It is no good condemning it. We must take the matter to court because the decision is illegal.
The Earl of Lindsay: My Lords, that is exactly what we are doing.
The second point raised by the noble Lord, Lord Hughes, related to the possibility of horizontal/vertical transmission, as the two pathways named by scientists, either between mothers and calves or between cattle in the same area. There is no evidence of either pathway. There is no evidence of the genetic transfer of BSE, nor indeed of contagious transfer.
Lord Hughes: My Lords, I do not like, "There is no evidence". After all, it was always said that "there was no evidence" that the disease could be passed from cattle to human beings; yet that is now obviously being

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explored as a possibility. Therefore we should not be so ready to act on the basis that there is no evidence. Perhaps we should be searching for evidence.
The Earl of Lindsay: My Lords, we have spent millions of pounds searching for evidence; but it is the consensus of all the scientists involved in the research—through SEAC and the research centres that are employed for BSE research—that that is not the route. They have been able to find no evidence—nor indeed to manufacture any—in their efforts to prove that as a possible pathway. They are all as certain as scientists can be that it is through the feed that BSE has been transmitted and not through genetic or contagious transmission.
Lord Palmer: My Lords, the so-called worldwide ban is a complete mockery since we in this country still eat British beef, which is still the best in the world.
The Earl of Lindsay: My Lords, the noble Lord makes a very good point. We know that it is not only the safest beef in the world but probably the best quality beef in the world. We are therefore at a loss to understand why the Europeans, without a shred of evidence, decided that it should be banned, not only from the Continent but from all world markets.
Lord Mackie of Benshie: My Lords, perhaps the noble Earl will not mind my asking him why he stated so strongly that there was no evidence of the possibility of genetic transmission or transmission by proximity when a statement from the Scottish Office indicated that "there was no evidence to the contrary". In other words, it could not be ruled out.
The Earl of Lindsay: My Lords, I meant exactly what I said. I assure the noble Lord that there is no evidence of vertical transmission of BSE from a mother to a calf. My understanding of the research is that the scientists not only seek to identify evidence where cases are known to be occurring, but also seek to manufacture such a pathway: they see whether they can infect a calf through infecting the mother. There is a very energetic search to eliminate that as a possible pathway. They have been unable to establish any proof that that is the pathway. They have, however, assured themselves that the most likely route, and the most likely explanation, is that BSE is spread through SBOs getting into feed.
Lord Kilbracken: My Lords, will the Minister explain how the particular age of 30 months came to be chosen? Why is it applied to all cattle? Is it not extremely heavy-handed to use the same age, irrespective of the breed, sex and type of the cattle involved?
The Earl of Lindsay: My Lords, the 30-month definition was chosen because SEAC, which represents the greatest body of expertise on the subject, suggested on 20th March that all beef from cattle over 30 months of age should be deboned. Shortly thereafter the farming unions, different parts of the processing industry and retail groups lobbied as one voice that, were we to take
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beef from cattle in excess of 30 months off the market, that would go a considerable way to restoring consumer confidence and therefore to restoring market activity. So it was in response to a united voice from the producers, the processors and the retailers that we reflected the SEAC watershed of 30 months with this 30-month scheme. We do not see it as being permanent. It is a temporary measure until the market is back where it should be and consumer confidence is back where it should be.
As I assured the House, achieving these exemptions is an absolutely urgent priority. There is a very good case for exemptions. They should help restore some sense to an otherwise distorted market.
The Earl of Kintore: My Lords, is the Minister aware how grateful owners of slow maturing cattle will be to hear what he just said and that the Government are consulting on exemptions for slow maturing cattle? I hope that there will be a good scheme up and running as soon as possible.
The Earl of Lindsay: My Lords, that is exactly what we want to see, too.

Jobseeker's Allowance (Pilot Scheme) Regulations 1996
6.40 p.m.
The Minister of State, Department for Education and Employment (Lord Henley)The Minister of State, Department for Education and Employment (Lord Henley) rose to move, That the draft regulations laid before the House on 28th March be approved [16th Report from the Joint Committee].
The noble Lord said: My Lords, I should also like to speak to the draft Income Support (Pilot Scheme) Regulations 1996.
The Government are seeking powers to test a new approach to help unemployed people back to work. The regulations are made under powers in Section 29 of the Jobseekers Act. That allows pilots of changes to benefit regulations to be set up:
"with a view to ascertaining whether their provisions will, or will be likely to, encourage persons to obtain or remain in work".
That is precisely the aim of the project work pilots.
The pilots will be operated by the Employment Service in two locations: the Hull and Medway and Maidstone travel-to-work areas. They will apply to all people aged 18 to 50 in those areas who have been claiming unemployment benefits for two years or more. We expect around 8,000 to 9,000 people in total to fall into that group.
Let me say a little about how they will work. When people in the client group attend their first six-monthly Restart interview in the pilot, they enter the first part of the pilot, which lasts for 13 weeks. The main aim will be to place people in suitable jobs. But other help will be available for those who need it. They may be referred to jobclubs for further help in looking for jobs, or to

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training for work to improve their skills. A jobfinder's grant of between £100 and £400 will also be available to help overcome financial problems in taking work.
We will, in addition, aim to put unemployed people in direct touch with employers through trial periods, during which they can demonstrate their abilities in a job while remaining on benefit. Employers who recruit people from the pilot will be able to claim a Workstart subsidy of up to £1,500.
For some people the intensive voluntary help which I have just described has already begun. The first project work Restart interviews took place on 9th April.
If, after that period of intensive help, people are still claiming unemployment benefits, they will be allocated a place on a work experience programme, which will last for a further 13 weeks.
The work experience element of project work will be provided under contract and will involve projects of value to the community. In most cases people will carry out 18 hours of work experience each week and, in addition, three hours of supervised job search activity.
We expect the vast majority of people will welcome the opportunity to take part in work experience. However, if an unemployed person refused to participate without good cause, his benefit would be disallowed for up to 14 days in the first instance, and for periods of up to 28 days beyond that.
The pilots are designed specifically to tackle the main problems which face people after a long spell of unemployment. Intensive help is provided to make jobsearch more effective. Work trials, Workstart and the work experience itself tackle the prejudice which people often face from employers. The requirement to attend a programme of structured help or advice can remotivate people and be the galvanising factor for those who have lost hope and motivation.
The requirement to attend work experience in project work also helps to reinforce a view which has gained considerable ground in recent years: if someone has been out of work for a long time, while the Government have an obligation to provide financial support to them, the taxpayer has a right to expect that they will take positive steps to improve their own prospects of finding work. I have no doubt that the vast majority of unemployed people want to work. But for the few who have no intention of seeking a job or who are claiming fraudulently, I would expect project work to offer a deterrent. As the House will see, the project work process is intensive and contains many different elements of help for unemployed people.
The regulations we are discussing today concern one important aspect of the pilots: to make people who fail to attend the work experience element subject to benefit sanctions. The regulations would provide that power under the income support legislation, which will apply until October this year, and the jobseeker's allowance once that is implemented.
The income support regulations were sent to the Social Security Advisory Committee in December, immediately following the announcement of the pilots. SSAC decided not to consult in late February, and the income support
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regulations and JSA pilot regulations were laid before the House in March. They were approved by committee in the other place on 25th April. The first referrals to the work experience element of the pilots, for which the regulations are needed, will happen in July.
Both sets of regulations make similar provisions. People who fail to attend the work experience element will be subject to benefit disallowance for up to 14 days on the first occasion and up to 28 days in subsequent instances. We have designed the regulations so that they match as far as possible the general sanctions regime that will apply under JSA.
We have built in a number of important safeguards. First, written notice must be given of the requirement to attend; and sanctions cannot apply unless there is a place available on work experience. Secondly, the normal rules for access to hardship payments will apply both under income support and JSA. Thirdly, those who can show good cause for not attending project work will not be subject to sanction. In addition to a number of specific examples of good cause—including that of caring responsibilities—there is also a general "good cause" provision to cover unforeseen circumstances. Decisions will of course be taken by independent adjudication officers.
The House will recognise that these regulations come forward to bring into effect a process that has been designed with care. It is based on considerable practical experience of helping long-term unemployed people to find work. The regulations have been considered by the Social Security Advisory Committee, and we have taken on board its comments.
We shall, of course, monitor and evaluate the results most carefully. We shall be looking to see how far the approach helps unemployed people to find work when otherwise they would have remained on benefit. We shall consider what new light project work throws on the problems that people who have been out of work for a long time have in getting a job and we shall take that fully into account in considering further measures to help such people.
All the evidence of the past suggests that people unfortunate enough to be out of work for two years or more may be left behind by the recovery unless we make a special effort to assist them. By approving these regulations, the House will enable the Government to test a carefully devised programme of intensive help to people who need it most in the improving labour market. I beg to move.
Moved, That the draft regulations laid before the House on 28th March be approved [16th Report from the Joint Committee].—(Lord Henley.)
6.47 p.m.
Baroness Hollis of Heigham: My Lords, I am sure that we all thank the Minister for repeating the statement made in another place. We all agree that the long-term unemployed find it especially difficult to re-enter the labour market. We accept that their skills, their motivation and, above all, the employer's attitude work against them. It is always easier to get a job if you already have one.

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We also welcome the principle of pilot schemes. Too often social security initiatives have been thwarted because of the all-or-nothing, the national-or-not-at-all approach. As a result, we have not been able to learn from the mistakes or the successes. We have not been able to look in at a learning process.
However, a number of worries remain. I shall raise five of them. First, there is the content of the programme itself. Despite the Minister's reference to skills in his opening remarks—which I entirely share—it is clear, so far as we can see, that the content of the programme is almost entirely about motivation and penalties, with nothing about skills. For example, would a positive outcome allow someone to go to a local FE college and take a course for three months in IT, advanced HGV (heavy goods vehicle) driving or to refresh catering skills? What guarantee is there that training is embedded in the work experience schemes?
The second question is about whom the scheme affects. As the Minister said, the scheme covers those between 18 and 50 years of age claiming benefit for two years or more. Whom within that age group does the department expect the employment service to target? My belief is that many of the older men who experience longer term unemployment may have a health problem. For example, they may have been on invalidity benefit but have failed the new incapacity test because they have not enough points, even though they continue to have genuine physical or mental health problems. What is the Government's view? Will they push such men into project work, knowing not only about the health problems but, more to the point, being aware that employers in future will be exceedingly unlikely to employ someone who comes with a poor health record in preference to someone who is fit. How are such older men affected by the programme? Even if such training placements do not worsen their health, the possibility of their re-entering the labour market is slender.
For example, where someone has been on invalidity benefit and fails now to qualify but nonetheless has some points, is it possible that he might come on to such project work only if he wished to do so rather than face a benefit sanction? I believe that the Government would seriously improve the success factor of the schemes were the Minister to accept such a qualification for people who either received invalidity benefit in the past or, in applying for incapacity benefit, have received points, though not sufficient, to qualify them for incapacity benefit. They are very often the people who are long-term unemployed but who cannot for reasons of health and employers' attitudes re-enter the labour market.
My third point is about providers. Which employers does the Minister have in mind? We all accept that the best chance for that person is to continue to work for the employer who has given him the work placement as the goodwill and motivation exist on both sides to make it work. Who are those the Government have in mind? Placing a person with an employer who is unlikely ever to employ him ensures, as we know all too well from Restart and YTS, that he is churned onto yet another training scheme when the present one finishes.
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The problem is that the Government are introducing the scheme without the background of a rising job market. Twelve people are chasing every vacancy. If this scheme adds a thirteenth person to chase that job vacancy, one is merely displacing someone else from the interview or the job. One is merely churning. The best prospect of expanding the job market is if the employer realises that the trainee represents value for money. In other words, the scheme would work if employers just as much as trainees were given counselling and support to extend their job opportunities. We welcome the Workstart bonus of £1,500. But what else is being done to counsel employers to help them take on additional trainees?
For example, would the employment service allow voluntary organisations to provide placements for long-term unemployed people and for that to be counted as a positive outcome? It always saddens me that most of those volunteering are employed. The benefits structure locks those who have the time to volunteer out of the community. They are excluded. A voluntary organisation approved for the purpose of these regulations, such as the National Trust, mimics the labour market in terms of the work skills it provides; is socially useful in the work performed; and is socially inclusive in that the unemployed who receive benefit also benefit society. The long-term unemployed are motivated because the volunteers are given a sense of self-worth, and, in very hard-headed terms, such voluntary organisations have an excellent record of preparing their volunteers for the world of waged work. That is one of the few ways of improving skills, motivation and experience in a situation where there is no rising job market and where, therefore, one employed person may replace another.
But that does not meet the Government's other objective, which is to cut the benefits bill. I was much struck that the Minister here and the Minister in the other place referred not to those who have been unemployed for two years but to those who have been receiving unemployment benefit for two years. That brings me to my fourth point—finance. Will the Minister confirm that the scheme is to cost about £12 million? Will he tell us where that money will come from? In another place my honourable friend Mr. McCartney asserted that the Government were cutting and in some cases closing down community action programmes in other towns to fund this pilot project. The Minister in the other place did not deny that. What is the point of that? Why this restless swishing of money around the system, taking from one group of unemployed in one town to give it to another group of unemployed in another town? Am I right in my fears that 40,000 people may be excluded from community action programme schemes in order to fund 9,000 people on project work? If I am right, it sounds like a lousy deal.
That brings me to my final point. How will the Minister assess the project? What percentage of jobs does he expect his 9,000 people to find? Will he net that against the loss of jobs, if that is what happens, among those cut out from the community action programmes? Will he know who is doing the project assessment?

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Unless it is properly assessed, both in terms of gross and net job gains, it is not worth doing the project at all. Compulsory schemes or quasi-compulsory schemes such as Workwise, jobplan or Restart have an extremely poor success rate. Usually around one in three have a positive outcome. But that mostly means shuffling that person onto yet another government scheme. Only one person in 25—about 4 per cent.—actually ends up with a job as a result of all this.
We share the Minister's concern about the situation in which the long-term unemployed find themselves. We welcome the use of pilot schemes. We are pleased also that the regulations seem to show a decent respect for the complicated situation in which many long-term unemployed find themselves—with regard to good cause for not taking up a placement, the rights of appeal, forfeit of benefit and so on. It would be helpful if the Minister could allay our other fears on the schemes' finance; if he could be supportive of those coming off invalidity benefit or who have poor mental or physical health but who do not yet qualify for incapacity benefit. It would be helpful also if he would accept that going on to an approved voluntary scheme would be an acceptable outcome.
At the moment it is very clear that all the department's research shows that over the past four years the problem for the long-term unemployed is not motivation but lack of jobs. The average unemployed person receives barely one job offer a year. The long-term unemployed receive fewer than that. Unless we introduce such schemes against a rising job market, all we do is add to the number of people chasing the vacancies without having added one iota to human happiness.
6.57 p.m.
Earl Russell: My Lords, I thank the Minister for a long and helpful letter about these regulations and I agree with the noble Baroness, Lady Hollis of Heigham, about the importance of finance.
These regulations do not look like something especially big but it used to be one of the particular political skills of King James VI and I that when he wanted to do something to which his opponents were likely to take the most intense objection he did it in a long series of small stages, each one so small that his opponents would have looked absurd if they had chosen to make a fight of it. My noble kinsman the Minister may perhaps remember introducing the regulations about Restart courses which were the beginning of the road which has led on to here, in each case bringing in a small extra measure of compulsion to be used on the unemployed. For we must be clear that benefit sanctions on the scale we are now discussing are a form of compulsion. These appear to me to be leading on very slowly by a series of Jacobean small stages towards something which is beginning to look remarkably like peacetime conscription. That is a change of very great magnitude, of the kind we ought not to be discussing on a series of small regulations.
Having mentioned the Restart courses, where attendance was to be compelled by means of a benefit sanction, I shall repeat a question I asked my noble
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kinsman then which he could not answer at the time and I hope he can answer now. What happens to the people who are sanctioned? Do they thereafter do a Restart course? Are they sanctioned again for refusing again, or are they lost from sight? An answer to that question and to the equivalent question about those sanctioned under these regulations is an absolutely essential part of monitoring the scheme so that we can judge what its consequences really are. If that is not done, the scheme is not being monitored.
Despite the sanctions, I understand now that if one takes the Restart and the job plan programme together, refusals in 1994–95 were running at 75,000 a year. So there must be something pretty strong driving those people to refuse those courses. We want to know what it is and that it is not going to apply this time round. In some cases it is clearly the quality of the training. For example, we have one reported case of someone who had been trained for three years as a hairdresser. All she had done in that time was to sweep hair from the floor. That is not really what I understand by training. It is one possible reason for being dissatisfied with training and, since training, whoever provides it, is inevitably going to be of uneven quality, it is something to which we should pay attention. Is the Minister in a position today to say any more about who is providing this training and in any more detail what forms it will take?
I also have very great doubts about the underlying analysis which has led the Government to these regulations. It is surely as we have heard it many times before; namely, the belief that the unemployed are workshy and need to be, as the Minister put it today, "galvanised". There may be all sorts of other reasons for not taking part in a training programme, such as the very commonly stated belief that it does not increase the chances of getting a job, or the belief that the training itself is a waste of time. The whole thesis of welfare dependency on which many of these galvanising measures are based, rests on the assumption that we enjoy an exceptionally generous level of benefits. That is not now the case. Our welfare benefits are now among the lowest in Europe. A thesis which continues to depend on the myths of these exceptionally generous and attractive benefits is liable to be based on out-of-date information.
There are other reasons for which people may refuse training that may not necessarily deserve a sanction. Decisions on "good cause" may not always be correctly reached. There is no decision system which is correct in 100 per cent. of cases. The training may be totally unsuitable; for example, suppose being stone deaf I found myself being trained as a musician. I would regard that as a waste of my time and everybody else's. In general, I have quite profound misgivings about any system which treats people as if they were plasticine, to be forced into whatever shape those in charge of them think they ought to take.
When this scheme is monitored it will be done in the form of positive outcomes. Can the Minister say what will be taken as a positive outcome from these courses? Will referral to another government scheme be taken as a positive outcome or will only those who get a job be counted as having a positive outcome? I want to know

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a bit more also about the hardship. I take the point made by the noble Baroness, Lady Hollis, about the effect that these sanctions may have on people's health. Two weeks without benefit or even four weeks, are not likely to leave one in a fit state to take on heavy physical labour. I hope that the Minister can tell us something about the availability of hardship payments for those who receive these sanctions.
We already get cases under the old sanctions of people who are found not to have eaten for three days or those whose water has been disconnected. That is spreading the inconvenience by what it might be paradoxical to describe as a ripple effect. It affects other people as well as those sanctioned.
If we are to have any reliable monitoring of what these regulations are doing, we desperately need monitoring of what happens to those who are disentitled to benefit. What do they do? What is the behavioural effect? What is the health effect and, above all, when it is over, in what way, if any, has their behaviour been changed? If we cannot answer these questions we simply cannot decide whether the regulations and training are having the desired effect or not. It is essential for the Government to get that information.
We are told that the immediate form of payment is the benefit level plus £10. To know what that is worth we need to know—and this is a matter of some urgency—what happens to entitlement to passported benefits. Do people taking these forms of training get free school meals or free prescriptions? If not, £10, so far from being a carrot, will have very much the opposite effect.
We on these Benches regard ourselves, in the light of the Resolution of the House of 20th October 1994, as being free to vote on regulations. The principle of these justifies the importance. The reasons why I am not going to do that tonight are first, that we voted on the principle of this on the Jobseeker's Bill and that, although not conclusive, is significant. Secondly, in the "good cause" provision; in the provision for travel over an unreasonable distance; and in the allowing of a good cause that we may not yet have foreseen, there are two very vital concessions which make good undertakings by the noble Lords, Lord Mackay of Ardbrecknish and Lord Inglewood.
I believe that I have already got all that I am going to achieve on this matter. That does not mean that I am satisfied, but I am grateful. The point about hardship is the one that remains. I repeat it—because I shall come back to it many times—we must know what happens to those who suffer these sanctions.
7.8 p.m.
Baroness Seear: My Lords, I wish to raise two points with the noble Lord. First, are the training programmes in any way linked with the NVQ qualifications to which the noble Lord's department is giving a great deal of support—indeed it is the sponsoring organisation? It is an opportunity to link the two together and that can only be advantageous. It will mean that people who have been trained, even if they got to level 1 of the
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appropriate NVQ, will have firm evidence to show to a prospective employer that they had made some substantial progress and reached some kind of a level. That will surely increase the opportunity of getting a job.
The second point concerns people who have been taking advantage of the 21-hour rule for studying while still drawing benefit. If I am wrong I shall not continue with what I am saying because it will only waste the time of the House. I understand that it is proposed to reduce the period to 16 hours. If that is correct, I want particularly to draw the attention of the noble Lord to a fact which is being felt by a large number of women who wish to return to the labour market and who wish to take training courses or study courses, or who have been doing so under the 21-hour rule. They are finding that the colleges believe that they cannot do an effective job with the students in 16 hours. I am informed that the colleges are thinking of cutting the courses because they do not believe that they will be able to get the numbers to undertake the studies if there is a reduction to under 21 hours. They believe that it will not be suitable to go ahead with the courses. I had this information passed to me only this morning. Quite a number of colleges are in a great state of confusion as to what they should be doing because at this time of the year they need to plan their courses for next year. If they believe that they are to be limited to women who can work only for 16 hours, that will substantially alter the programmes that they put forward.
It is a kind of indirect consequence which very easily becomes overlooked. We need clarity on the matter. The colleges need to know now what the position is. I know that the noble Lord understands. Now the courses are being planned and arrangements made. If the colleges cut back the courses in anticipation that the 16-hour rule will make it impossible for them to do the job that they want to do and for women to come forward, the ultimate effect may be very undesirable in a way which I know the noble Lord would not wish to see.
7.10 p.m.
Lord Henley: My Lords, the last point raised by the noble Baroness, Lady Seear, is not strictly relevant to what we are discussing, so I hope that the noble Baroness will accept my assurances that I shall write to her on it in great detail.
As ever, I was grateful for small mercies in that at least both the noble Baroness, Lady Hollis, and the noble Earl welcomed the concept of piloting a scheme of this sort. However, I completely reject the allegation from the noble Baroness that such a project will not create jobs but will merely displace others from their jobs—in other words, that it will move people around. The noble Baroness said that trying to do that when the job market was, as she implied, shrinking was not the right way forward. That is not my view and it is not the view of the Government. It is not for government to create jobs. It never has been and it never should be. The only way in which governments can create jobs is to build and create a strong economy. We are doing just

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that. The noble Baroness ought to know that employment has grown by some 730,000 over the past three years. The aim of project work is very much to help people to take advantage of that.
There has been much concern about the training element of project work. There seems to be considerable misunderstanding about the aim of project work and its work experience element. The noble Baroness, Lady Seear, asked whether NVQs could be made part of the training that is being provided. I should make it clear that the providers of project work placements are not required to provide vocational training leading to qualifications. People who take part in the pilot scheme who could benefit from such training will be eligible for training for work. That is the purpose behind training for work. We are looking here at providing appropriate work experience for the individuals at whom we are addressing the scheme. There is obviously an element of training in work experience, but work experience is not training in itself. If training is appropriate—
Baroness Seear: My Lords, the noble Lord knows better than anybody that NVQs are concerned with competence on the job. They are tested only by competence on the job. That being so, there is no question of training outside. It is training on the job.
Lord Henley: My Lords, if training is appropriate, it can be pursued through training for work. That is the purpose behind training for work. We are talking here about an element of work experience. If we are to provide work experience, it is right that it should be work experience that is appropriate for those who are likely to benefit from it.
The noble Baroness, Lady Hollis, and the noble Earl, Lord Russell, stressed the importance of having the right providers of work experience. The noble Baroness went on to ask whether voluntary organisations and others could provide that experience. All that I can say at the moment is that we can now announce that we have selected the major providers of the project work placements in the two areas. The activities to be provided range from conservation and environmental work, to retail administration, to—I believe that this will please my noble kinsman—historical research. The providers are charitable and educational bodies and private sector trusts. They have only recently been informed of their success in the bidding process. Until the bidding process is completed, we would prefer not to give precise details such as the names of those organisations. However, I assure the House that I shall be more than happy to provide that information as soon as practicable and to give further details of exactly what—in addition to historical research—is to be provided.
Baroness Hollis of Heigham: My Lords, I was not going to ask about the historical research, but that is good news. If this proves an appropriate way forward, will the Minister learn from the project experience that a placement with a voluntary organisation should also be regarded as an approved, appropriate and positive outcome from a JSA interview?
Lord Henley: My Lords, the noble Baroness is more than aware that this is a pilot. The aim of having a pilot scheme is to learn something from it. Obviously, in advance of the evaluation and assessment of the pilot, I cannot give any assurances as to what we shall learn, but we shall no doubt learn some interesting things. Indeed, what the noble Baroness is suggesting might be one such thing. In due course I shall give the noble Baroness further details of exactly who has been selected. Where possible, I shall also try to give further details of what is being proposed.
The noble Baroness also asked whether individuals with health problems, particularly those in the older group within this cohort, if I can use a modern word, would be affected. I should start by saying that we selected the group—those aged 18 to 50—with some view of excluding those who might be more likely to suffer the problems which the noble Baroness specified. However, I assure the noble Baroness that the regulations specify that an individual will have "good cause" not to participate if participation is likely to endanger his or her health. I think that that deals with the particular problems which the noble Baroness raises. I cannot give a guarantee that anyone who had been in receipt of invalidity benefit in the past or who had received a number of points towards incapacity benefit would automatically be covered, but the "good cause" provisions allow non-participation if participation is likely to endanger health.
Baroness Hollis of Heigham: My Lords, I thank the Minister for giving way again. I am sure that he is trying to be helpful and I am sure that we both want to reach the same position on this. However, will he clarify what he means by "endanger health"? It is clear from the regulations that any job placement which worsens or aggravates an existing condition would be held to endanger a person's health—or health and safety, according to the set of regulations being considered. I am concerned about somebody with a mild but chronic disability, perhaps associated with back or mental health problems. A person might suffer persistent pain and fatigue, for example. For such a person, the work placement might be uncomfortable but would not necessarily endanger health in the sense of worsening it. Can the Minister help us on this?
Lord Henley: My Lords, it will obviously be a question of fact and degree in every individual case. I should not like to take the noble Baroness any further other than to say that decisions on what is likely to endanger health will be adjudicated on by the independent adjudication officer. If the placement was held to endanger health, the person concerned would have "good cause", but that must be a question—
Baroness Hollis of Heigham: My Lords, but what does the word "endanger" mean?
Lord Henley: My Lords, I think that "endanger" means exactly that. It must be a matter for the independent adjudication officer. He must decide on the facts before him.

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Perhaps I may move on to a point raised by the noble Earl, Lord Russell, about passported benefits. That is important in terms of potential disincentives to participation. I can give the House an assurance that passported benefits will not be affected in any way whatsoever.
The noble Baroness suggested that the pilot removes provision from other areas. She particularly mentioned community action. People outside the area of a pilot scheme are not losing out. We are offering them the most appropriate help in the current economic circumstances. I refer to a wide range of programmes focusing on job search and on removing the barriers into real work. In a very difficult public expenditure round we have maintained the number of opportunities for unemployed people at the same level as last year.
With regard to community action, I accept that that was a useful and successful programme, but it no longer represents the best value for money for the taxpayer as part of our current strategy for tackling longer-term unemployment in what I believe—the noble Baroness should accept this—is a much more buoyant labour market than in the past.
I move now to the question of evaluation and assessment, which is of considerable importance. It is important to know whether a pilot scheme has been a success. I assure the House that the pilot schemes will be fully evaluated both by the work of the internal researchers in the Employment Service and by outside bodies under contract. The number of people moving into jobs will be a major focus of that evaluation. That will be something that will inform our judgments as to how well the two pilot schemes have worked.
The noble Earl, Lord Russell, asked about sanctions, what would happen after them, and the general purpose behind them. The sanctions are there, as on other occasions, to protect the taxpayer from having to subsidise people who have no good reason to remain unemployed. They exist to influence the behaviour of people who are claiming benefit, and they have an important role in reinforcing incentives for unemployed people to take the right steps to get back into work.
We do not expect a healthy adult to suffer any significant change in his or her health during a two-week benefit exclusion. Benefits will be available to vulnerable groups to prevent hardship. But after the sanction period people will be referred again to project work. That process will be repeated again and again until they have completed their 13 weeks of project work. Obviously the evaluation will include an examination of those people as they leave the pilot, and an examination of those who are sanctioned and what they do and where they go. I hope that that will tell us much not only about the project itself but about the sanctions and their effectiveness.
I move on to the hardship rules. Under income support those who are sanctioned will be able to apply for hardship payments under the existing rules: 20 per cent. or 40 per cent. depending on the circumstances. Under JSA those who are vulnerable—for instance, those who are ill or who have children—can apply for hardship payments. That is in line with the
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policy on all sanctions. There are no special rules for the pilots. We are doing no more than happens elsewhere within JSA as it will come into effect in due course.
We believe that these regulations are an essential component of an exciting and genuinely radical programme—a programme which offers real hope to unemployed people. Certainly, those people who do not want to be helped into jobs may find the process uncomfortable. But our responsibility is to unemployed people and the taxpayer, not to the freeloaders.
We recognise that there is a degree of complexity in this approach. That is why we want to test it thoroughly. We could have introduced it on a national basis—which the noble Baroness herself rejected—with a simple amendment to the JSA regulations. We choose instead to use the pilot powers to monitor and evaluate the scheme, which on a national basis could cost a great deal in the short term. I commend the regulations to the House.
On Question, Motion agreed to.

Income Support (Pilot Scheme) Regulations 1996
Lord Henley: My Lords, I have already spoken to these regulations. I beg to move.
Moved, That the draft regulations laid before the House on 28th March be approved [16th Report from the Joint Committee].
On Question, Motion agreed to.

London Regional Transport Bill
7.24 p.m.
The Parliamentary Under-Secretary of State, Department of Transport (Viscount Goschen): My Lords, I beg to move that the London Regional Transport Bill be now read a second time.
This Bill is essentially technical in nature. Its purpose is to extend the powers of London Transport in order to allow it to make full use of the opportunities available under the Government's private finance initiative. I believe that the Bill has cross-party support. Private sector investment in London Underground in particular should not be impeded by unnecessary restrictions in LT's statutory powers. I hope that your Lordships will accept that principle and support the Bill.
The Bill originates from the work done by London Underground in developing a number of PFI projects, which I shall describe in a moment. In looking for the most innovative and attractive deals, they came across various potential or actual legal problems arising from their statutory powers. This is not surprising. London Transport's existing powers date back to 1984, well before the PFI. It is worth emphasising, however, that the Bill was drafted following a request from London Transport, and in full consultation with it, and it has its full support.

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Three of the projects which are now at quite an advanced stage brought to light the problems which this Bill is intended to address. The first is known as Communications or Connect. This project would require a contractor to provide an integrated radio system for London Underground based on a fibre optic network. The network would not only provide updated systems for LUL's own communications systems, but it would have sufficient spare capacity to be used by the contractor to provide telecom and IT services to third parties. Sharing costs in this way would greatly reduce the cost to LUL.
Secondly, there is a ticketing project known as Prestige. This would involve the complete modernisation of LT's ticketing systems, based on the progressive introduction of smartcard technology. The contractor would take over responsibility for providing and selling tickets for both Underground and bus services and for the equipment to validate these such as the ticket gates at Underground stations. Giving the private sector responsibility for the whole system would provide scope for the introduction of innovative and efficient systems. But, as with the Communications project, there may be scope to spread costs; for instance, if the smartcard can be used as an electronic purse to buy a range of other services.
The third scheme involves power supply. This would involve a contractor taking over London Underground's existing power generation plant and taking responsibility for the provision of main and emergency power supplies for the Underground network. As with the schemes already mentioned, the contractor would be able to spread costs by supplying power for third parties using the Underground's distribution network. These are major projects that would involve a private sector capital investment of around £650 million.
It may assist the House if I emphasise what the Bill does not do. I can reassure your Lordships that the Bill in no way erodes the powers of London Transport or changes its status. This is not a privatisation Bill. In particular, there is nothing in the Bill which affects the basic duty of London Transport, as set out in Section 2 of the 1984 Act, to provide or secure the provision of public passenger transport services for Greater London. Equally, there is nothing which in any way affects London Transport's functions under Section 8 of that Act in relation to the planning of fares and services. Nor does the Bill change the wide range of other provisions in the 1984 Act which would almost certainly need to be changed if the Underground were to be privatised.
I hope that the House does not take these remarks as a sign that the Government's belief in the benefits of privatisation is waning. Far from it. One has only to look at our commitment to the railway franchising process to see that.
I turn now to the detail of the Bill. The main purpose of Clause 1 is to empower London Transport, subject to obtaining the Secretary of State's consent, to enter into an agreement with a contractor under which the contractor will carry on activities which LT does not itself have the power to carry on. Paragraphs (a) to (c) of the new Section 3(2A) to be inserted in the 1984 Act
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set out the types of agreement which it will be possible for LT to sign. The new Section 3(2A) is intended to maximise LT's flexibility to enter into PFI contracts while ensuring that the agreements relate either to LT's function of providing public passenger transport services in London or the exploitation of LT land or assets by the contractor. This amendment is essential if London Transport is to gain the maximum benefit from the private finance initiative.
I have already mentioned London Underground's proposed Communications PFI project for the installation of a fibre optic network, with some capacity being used by the Underground and the rest being available for sale to third parties. London Underground has no powers to act as the provider of such a cable network to other users, nor, as things stand, can it enter a revenue-sharing agreement with a contractor who installs and manages a network. This provision will enable London Underground to enter into such agreements, so that, through a revenue-sharing or royalty clause in the contract, it can share the contractor's success in selling capacity to third parties. I believe that that sums up the main provisions of the Bill.
Still with Clause 1, the new Section 3(2B) we are inserting in the 1984 Act is a technical amendment to enable London Transport to sign contracts with banks or other financial backers of the PFI contractor. For large value projects, both London Transport and the PFI contractor's financiers are likely to want the reassurance of direct agreements with one another, so that their respective rights are protected should the contractor default.
The main purpose of Clause 2 is to provide for the continuity of services. Subsection (1) enables London Transport to acquire land for the purposes of agreements under Section 3(2) or 3(2A). This would, for example, enable land to be acquired in LT's name for an electricity sub-station not directly required for LT's own purposes but for use by the contractor in supplying electricity to LUL. I would emphasise that this is not a compulsory purchase power; it is intended to safeguard LT's claim to essential assets at the end of a PFI contract.
Subsection (2) provides that LT may take over services where they are no longer being provided by the contractor under a Section 3(2) or 3(2A) agreement. Again, that is a pragmatic provision designed to ensure continuity of service where a PFI contract ends and another contract cannot be let immediately. Subject to obtaining the Secretary of State's consent, LT could take over the activity concerned so as to ensure the continued provision of passenger transport services and, if applicable, so that it can continue to provide services to any customers of the contractor.
We expect that when PFI contracts expire the commercial activities associated with them would generally pass to a new private sector contractor, following a further competition. But we do need to provide for what we trust will be the very rare circumstances in which a contract comes to an end prematurely; for instance, through default of the contractor. In that situation, LT would clearly want, and

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would have the powers, to take over immediately those functions connected with the running of its own services. But it would be perverse if services being provided to third parties then had to be terminated.
Finally, subsection (3) has the effect of empowering LT to do all other things in its power which in its opinion are necessary or expedient to secure the performance of agreements under Section 3(2) or 3(2A). That power sounds very wide-ranging in its scope. But in fact it is a residual power which needs to be read in the context of LT's express powers elsewhere in the 1984 Act and in this Bill. This provision will, however, widen LT's powers so that it can take a number of practical steps to help ensure that PH agreements work in practice; for example, by enabling LT to take charges on moveable property so as to safeguard its claim to important assets at the end of a PFI contract.
Clause 3 adds a new section (Section 31B) to the 1984 Act. In order to ensure continuity of service, the new Section 31B empowers the Secretary of State to make an order enabling certain statutory powers—for example, powers acquired by LT under old private Acts—to be transferred between LT and a contractor or to be exercised concurrently by the two.
Clause 4 makes minor and consequential amendments which can fairly be called technical ones. Clause 5 is a standard financial provision. Clause 6 is the standard provision giving the Bill's Short Title, commencement date and extent.
I hope that the House will forgive me for a somewhat dry and detailed explanation of the circumstances of the Bill, but that is justified by the fact that this is a fairly dry and detailed Bill. It is, in essence, a technical one. It is a small Bill. But it is an important one for public transport users in London. I beg to move.
Moved, That the Bill be now read a second time.—(Viscount Goschen.)
7.34 p.m.
Lord Clinton-Davis: My Lords, not only do I thank the Minister for explaining the purpose of the Bill so cogently, I forgive him for committing the offence of being dry. I did not think he was all that dry. I have always thought of him as something of a wet, but there it is.
We support any reasonable means of promoting more investment in the publicly operated, integrated transport systems that apply in this country. The Bill could be helpful. I have one concern—a concern which the Minister did not wholly address; that is, the wide spread of Clause 3, to which I shall come in a moment. Our concern in this House, as it was in another place, is whether that clause contains any hidden agenda—the hidden agenda being privatisation—which the Minister was at pains to say it did not have. The Government, he said, have not lost their faith in privatisation—mania for privatisation might be a better description—of the railways, they have just lost their way.
We are going to debate railway—
Viscount Goschen: My Lords, perhaps the noble Lord will forgive me. I am sure that is what I did not say. The noble Lord may be putting words into my mouth.
Lord Clinton-Davis: My Lords, I know that the Minister did not say that. He said that the Government have not lost their faith in privatisation, especially of the railways.
Viscount Goschen: Hear, hear!
Lord Clinton-Davis: My Lords, I was saying that they had not lost their faith, they had just lost their way. I shall not go further into that, because we shall be having a debate on the railways tomorrow afternoon. We shall be able to explore what has happened with greater precision.
I shall turn immediately to Clause 3, which the Minister says is a wide-ranging clause. While he says that the Government have no intention of pursuing privatisation through this route, will he concede that it could be so used? After all, what it does is to enable the Secretary of State by order to provide that certain of LRT's statutory functions may be exercisable by another person, either instead of LRT or concurrently for the purposes of carrying out agreements. Clause 2 is also extremely wide. From the Minister I should like not merely an assurance that the Government have no present intention of pursuing a course of privatisation through the Bill, but a categorical assurance that they would not be so empowered. That is a different question. It is one which caused another place to debate this issue at great length. I do not propose to ape it in that regard.
The trouble is that assurances given from the Front Bench are of little avail if the Government change their mind. They changed their mind, for example, over the Railways Bill. They intended initially to privatise British Rail first and then Railtrack some time later. Then they committed a volte face; they changed the order altogether, without any proper debate of course in either House of Parliament as to why they had chosen that particular route. Mere assurances do not suffice. That is why I put the question in the way I did.
Perhaps I may turn to the element of the PFI, which is essentially what the Bill is about in terms of empowering London Regional Transport to do certain things which the Government say it could not do without the provisions of the Bill. I accept that. Unfortunately, the PFI, as conceived by the Government, has not been all that it was cracked up to be. The claims for its success have been wildly exaggerated by the Government.
The Government's PFI scheme followed the scheme introduced initially by my honourable friend in another place, Mr. Prescott, some four years before the Government even conceived of undertaking a PFI of this kind. I shall come to our own scheme in a moment. The PFI as conceived by the Government has come under massive criticism from a good part of the private sector, not least the construction industry, which is most vitally affected by it. It was designed to provide funding

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additional to that put up by the Government. Instead, the Government seem to think that it is an alternative, very largely, to public expenditure.
The PFI was designed, or so the Government said, to enable public enterprise to diversify profit-making activities. That is what the Bill purports to do. That is fine but it appears to be wholly inconsistent with the Government's attitude towards the Post Office, in respect of which we in the Labour Party have been arguing for precisely that kind of remit. Perhaps the Minister will explain that inconsistency.
The Government have been able to expend only one-fifth of the expenditure authorised on PFI schemes. That is scarcely a resounding success. They have failed to provide guidance as to national or even regional transport objectives, without which the private sector is left in a state of utter uncertainty. They have failed to offer any, or any reasonable, idea of prioritisation, of risk allocation and of facilitating the tendering system, which is grotesquely cumbersome.
As I said previously, the Opposition have published their own public/private finance initiative based on partnership between the public and private sectors. They have done so not in response to the Government's scheme but well in advance of it, as the Minister should know. We have consulted on problems affecting this form of financing and the relationship with the public sector borrowing requirement. We shall continue to consult with the private sector on those issues. There is no doubt that these exchanges have already proved to be constructive and worth while and have been well received by the private sector.
Perhaps I may turn briefly to the challenges which I see confronting London Underground. First, London Regional Transport's underground system—indeed, its whole system—is crucial to the way in which London lives and works. It is crucial to its economy and the contribution which the capital city makes to the national economy and to the country's well being. It is crucial to the tourism industry, in which my noble friend Lord Graham takes a keen interest.
Secondly, it is clear that London Underground has not been able to perform as well as it could. That is underlined by the Bill and by the legacy of neglect inherited by London Regional Transport in terms of underinvestment, inconsistency in government policy and the ideological spasm that resulted in the abolition of a strategic transport planning authority for London.
Perhaps I may give examples of the legacy of neglect. The pumps and drainage systems were designed in Victorian days. In 1993 London Underground said that emergency investment of £18 million a year was needed just to keep the network operational. In fact, £9 million was made available and current investment has been forced down to £5 million a year. The geriatric track leading to the doubling of speed restrictions in 1994 and 1995 also illustrates some of the problems confronted by London Regional Transport. There are problems of subsidence and land slippage; pre-war signalling systems on the Northern Line; the warning of major closures on four lines, including the Bakerloo Line; and major reductions in staffing so that many underground
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stations are unmanned at night, causing great anxiety particularly among women and disabled people in old, dilapidated and uncomfortable stations. That situation is likely to become worse with privatisation, with its record of cuts in staff numbers.
The Government's inconsistency in investment policy is illustrated by the fact that, although Ministers say that capital investment in London is at an all-time high, one must recognise that half of that is to be applied entirely to the Jubilee Line extension and £200 million is generated by London Regional Transport itself against a backcloth of the problems that I have described. In 1991 the Monopolies and Mergers Commission recommended that investment should be increased to about £700 million or £750 million a year. The then Minister, Malcolm Rifkind, responded affirmatively. Just before the 1992 election, the Government promised £2.1 billion over three years. After the election it was slashed by £700 million and in 1995 the three-year figure was cut to £1.2 billion.
The problem with all that is that London Regional Transport's hopes were first raised and then dashed, creating a situation in which it had to spend time and resources in developing projects. That was utterly wasted when funding had to cease abruptly. We are addressing the way in which we make the difference between an underground system set on a process of slow decline and one which, perhaps modestly, can continue to meet London's needs. Certainly it is important that the partnership system to which I have referred should be brought into place at the earliest opportunity.
The need for a strategic transport planning authority for London is clear and overwhelming. It is now supported by many Conservatives but still resisted by the Government. Such an authority needs to investigate in depth a number of interesting initiatives. London First has made a proposal to invite businesses to vote on whether they should contribute to a specific investment programme in existing and new railway lines in London. That proposal is worthy of consideration. I wish to know whether the Government have given it any thought and, if so, what their conclusions are. It is, after all, only asking for businesses to vote on something.
Ministers have raised concerns about the public sector borrowing requirement, which is always the obstacle. Yet the very same Government have devised ways and means of circumventing the PSBR on poll tax, council tax and grant-maintained schools. Therefore, it does not seem to be such an obstacle when the Government do not wish it to be.
London First suggested congestion charging with revenue being hypothecated to the improvement of London's transport system. Would the Minister care to comment on that and say where it falls in terms of raising funds in order to carry out so many extremely important schemes? I am saying only that the schemes are worthy of careful investigation. Our intention is to work properly and effectively with the private sector in order to ensure that the public/private partnership schemes work to the advantage of a national and London infrastructure system so that we can achieve

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affordable, efficient and safe links between the capital's transport terminals and its people. In so far as the Bill goes some way towards that, we welcome it.
7.47 p.m.
Lord Bowness: My Lords, I welcome the Bill even though it is described by my noble friend the Minister as being of a technical nature. All transport matters affecting London are of considerable importance to all those who live and work within the capital area and who visit it. It is fair to say that the success or failure of transport within the capital has the ability materially to affect London's future position in the world. I welcome the Bill, giving London Regional Transport the ability to take greater advantage of the private finance initiative without being fettered by the apparent problems with the existing legislation.
It is easy to quote figures selectively, but if we look at what has been done we know that there has been considerable investment in London transport since the Government took it over in 1984. Of course, at any one time and in any one case there will always be demands and needs for more. It is important that the private finance initiative is drawn in because those additional improvements and schemes will not come about without such private-sector finance.
The noble Lord, Lord Clinton-Davis, tempted me about the need for a strategic transport authority for London. Perhaps that is for another time and another debate. I could pose the question: what was the nature of the investment between 1969 and 1984 when the Greater London Council ran London's transport? Indeed, what did the Greater London Council do about many aspects of transport policy? Those of us in the outer areas of the capital saw little or no activity whatever during those years. However, I should not wish to bring contention into this debate.
There is no doubt at all about the value of the private finance initiative. I do not know when it started. I am not certain whether it was conceived four years ago, as the noble Lord, Lord Clinton-Davis, suggested. I speak from personal experience as a member of the borough council of Croydon and, if it is appropriate, I declare an interest as such. The tram link scheme there, which has been at least six years in its formation, has always been based on the involvement of the private sector. We were encouraged on many occasions by the Government to take forward that matter with LRT.
That is a light rail system which will run from Wimbledon, around Croydon, through to Beckenham and New Addington. It will be a completely new east-west public transport system in that particular area of the capital. While final details have yet to be announced, the preferred bidder for the concession has been chosen. I believe that that light rail system will be built with the support of government and a substantial contribution from the private sector.
The development of the scheme and its promotion through Parliament would not have been possible without the private sector, which became involved at a very early stage with adequate arrangements for fair and open tendering when the time came.
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I welcome in particular the fact that this Bill will enable the ticketing project to go forward. There is no doubt that the success and attractiveness of public transport depends not just on its reliability and cost but on the ease with which it can be used. We can look forward to new ideas and expertise from the private sector being brought to ticketing in London. Whatever the success of London transport in recent years, anyone who has travelled abroad on the metros and bus systems cannot fail to be impressed by the pre-buying of tickets, and the smart cards which can be validated without the necessity of being checked by drivers and conductors. Those small matters, coupled with good information—where stops are positioned and indications of which direction buses and trains are going—all make the public transport system more user-friendly. Perhaps we could get away from waiting at Victoria bus station among the diesel fumes and the wet and the wind if there were such improvements.
I believe that the private sector financial initiatives can bring much to London transport. I wish to see the public transport system within the area of the capital successful and thriving. Anything that holds back that investment should be swept away. For that reason, I support the Bill.
7.52 p.m.
Lord Mountevans: My Lords, I am a person locked into public transport for reasons which most of your Lordships will know. Therefore, I am happy to support a Bill which facilitates and may even increase investment in London transport.
I supported the London Regional Transport Act 1984 which I shall call the nationalisation Act. This Bill, which brings the private finance initiative into play, seems to me to update that Act in ways which enable London transport to take full advantage—and I say so as a taxpayer, council tax payer and fare payer—of the concept of PFI.
On transport subjects, the noble Lord, Lord Clinton-Davis, is a noble friend rather than a noble Lord. Over the years, he and I have both sought to find additional finance for LRT. I am still exploring the tax exempt bond and other ideas which were evolved by the noble Lord and the right honourable Member for Kingston upon Hull, East. I hope that that continues.
The preamble to the Bill tells us that it has no effect on public expenditure but may well accelerate major investment projects to the extent that PFI may be more cost effective than the practices envisaged when we renationalised LRT in 1984. However, I have some caveats. First, the PFI is not painless. It seeks to be a blend of Treasury finance and Treasury practice trying to congeal with the private sector's willingness to accept risk, balanced by return. Those of us who were involved in either the Jubilee Line extension or the GEC Northern Line replacement deal remember bitterly that the Treasury and the private sector are not easy bedfellows in those contexts. Therefore, my first reservation is that if we are to make PFI more accessible to London transport, we must expect the Treasury to go further towards understanding private sector concepts. If we fail to do so, I fear that both this Bill and PFI as applied to London transport will fail.

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My second reservation is about the department's document, co-published with the Government Office for London, entitled A Transport Strategy for London. I am disappointed by the Government's intention to maintain investment at broadly the same level—some £500 million per annum—in London Underground. I am disappointed by the lack of any commitment to a medium-term total planning funding level for London transport as a whole which is, after all, in pursuit of projects which are most needed. I am thinking in particular of traffic congestion and its consequences for bus operation.
A Transport Strategy for London proposes completion of a bus priority network by the year 2003, as it promises modernisation of the Underground system by the year 2008. As a user of both, I should like both those dates brought forward. I speak for many users in that respect.
Capital projects on the Underground require self-generating funds. I pay tribute to London transport and its increasing ability to generate those funds. They require Treasury support and Treasury understanding of the private finance initiative, which goes back to a point I have already made.
Buses are something else. I welcome the Government's support for bus priority measures but I want to move much more quickly. Quite simply, if one overlooks the Thames—and I am not aware of London Regional Transport having any responsibility for the Thames—the London bus is London transport's most under-utilised asset. I gather that in central London, the occupancy of buses is only 25 per cent. which means that 75 per cent. of the bus capacity on offer is wasted. If one goes wider into what was the Greater London Council area and looks at LRT as a whole, the occupancy rate is only 12 per cent. So 88 per cent. of the product on offer is wasted.
No commercial company could survive with wastage of 75 per cent. or 88 per cent. Therefore, I ask my noble friend to address two issues. The first is an acceleration of bus priority measures. I see no reason why the PFI should not be involved. It is for the Department of Transport to work out how, but that is what it is there for. I hope that that will be bracketed with a more vicious attitude towards the private motorist.
I ask my noble friend to remind the bus operators of London—now all commercial companies under subsidy—that they have been given competitive freedom. My noble friend Lord Bowness mentioned what happens in Europe; I should like to explore that further. Will the Government accept that the greatest reason for under-usage of buses is not convenience or congestion, but cost? If we can sort out congestion by going for bus priority, we must encourage the bus operators to attract greater usage by producing the single-journey ticket, covering two or three bus companies. As my noble friend well knows, that is universal practice in Europe. Why can we not do it here? It is not a matter of "not invented here". If it can be done abroad, why can it not be done here? If we did it here we would take pressure off the Underground. We would encourage use of public transport in a wider
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sense; we would be green, environmentally speaking, and, of course, we would make ourselves more readily accessible and more user-friendly to the tourists which the noble Lord, Lord Clinton-Davis, mentioned when quoting his noble friend Lord Graham of Edmonton.
Finally, perhaps I may come closer to home. PFI is one thing: enabling it is another. However, deep down inside we need a strategy for transport in London. Noble Lords will know that Westminster Bridge has been 50 per cent. closed for the past 18 months while the side on which traffic runs from here towards Waterloo is rebuilt. Moreover, it will be 50 per cent. closed on the other side—the side that takes traffic from Waterloo to here—until at least June of next year. Indeed, that is what the signs say.
The Bakerloo line is closing between Waterloo and Piccadilly from October for at least six months. Is that really the way to run transport and to make it appealing? Is it really the way to run a city the size of London? Major rail programmes are scheduled in the following order: the Heathrow Express, the Channel Tunnel Rail Link—thank God!—Thameslink and eventually CrossRail. Can we have similar planning in the immediate vicinity?
8.1 p.m.
Viscount Goschen: My Lords, I should like, first, to thank all noble Lords who have taken part in this short but interesting Second Reading debate on the Bill. My noble friend Lord Bowness slightly chided me for describing the Bill as technical. Of course, it is technical but, nevertheless, it also has an important real effect which goes way beyond its somewhat technical provisions.
However, by my own admission I did say that my initial explanation of the Bill was somewhat dry, but at least it stuck to the basic provisions and contained something of an explanation in that respect. I believe that other contributions, notably that of the noble Lord, Lord Clinton-Davis, ranged somewhat wider. However, the noble Lord had one particularly substantive point which I shall address now for the convenience of the House.
The noble Lord mentioned a point that was made, and, indeed, pursued at great length, in another place; namely, the possibility of a hidden agenda. He asked me to give him an assurance that that was not the case. I believe that I can do so. A careful reading of the relevant clauses of the Bill makes it clear that the legislation has a very specific purpose. I give way to the noble Lord.
Lord Clinton-Davis: My Lords, I am much obliged. Before the Minister leaves that point, can he give me a specific assurance that that provision could not be used for the purpose of a privatisation measure?
Viscount Goschen: My Lords, I believe that I can give the noble Lord that assurance. As the Notes on Clauses to the Bill explain, the new Section 31B would enable the Secretary of State, by order, to provide that certain of London Transport's statutory functions are to be exercisable by a contractor for the purposes of

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carrying out agreements under Section 3(2) and 3(2A) as I detailed earlier. However, subsection (3) of the new clause explicitly excludes—I emphasise "excludes"—the transfer of statutory functions under the 1984 Act. Therefore, as an example, an order could not transfer LT's general duty under Section 2 of the 1984 Act to provide or secure the provision of public passenger transport services. Similarly, an order could not transfer LT's duty under Section 8 of the 1984 Act to control the level and structure of fares, the level of frequencies and so on; indeed, those would remain the functions of LT. I believe that that explanation fully addresses the noble Lord's specific point.
The noble Lord also made somewhat disparaging, although perhaps supporting, remarks about the private finance initiative. It is worth making the point that the actual actions predate the name; indeed, there were a number of such projects going on, the most noticeable of which was the Channel Tunnel, where private finance was so involved.
I do not accept for a single moment that PFI has not been a success or that the Government have failed to provide guidance on its implementation. Over 1,000 potential projects have been identified with government departments by the Private Finance Panel with a capital value of some £25 billion. With the panel's help, detailed guidance was issued by the Treasury last November and entitled, Private Opportunity, Public Benefit. I hope that I can reassure my noble friend Lord Mountevans that the Treasury is indeed receptive to the needs of the private sector. Indeed, as my noble friend Lord Bowness pointed out, private finance schemes have been around for a number of years. I believe that that emphasises my earlier point about the Channel Tunnel and about the Dartford-Thurrock crossing.
My noble friend Lord Bowness gave impassioned support to the private finance initiative. I believe that that is wholly accurate and very worth while. The use of the scheme to identify projects where the private sector can contribute its own investment, and indeed its own management skills, to public sector projects has revolutionised the way that we have looked at such projects. I see that the noble Lord wishes to intervene again. I give way.
Lord Clinton-Davis: My Lords, I thank the Minister for giving way. The problem is that the attitude of the construction industry in particular is one of great dissatisfaction based upon a number of points that I made in my speech; namely, a lack of prioritisation, a complex and very bureaucratic system of tendering and an inability to understand what the Government's national and regional objectives are with precision. Therefore, will the noble Viscount concede that such problems exist? If he does not understand the situation, he will not begin to address the anxieties felt by the construction industry which I am sure both he and I want to try to resolve.
Viscount Goschen: My Lords, I certainly accept that nothing is perfect. However, we are talking about very substantial projects which entail partnerships between the Government and the private sector. I am afraid that it is
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necessary for certain procedures to be followed and for Treasury rules to be satisfied. Indeed, we are talking about large sums of money and about ensuring that the rules of the Treasury are fully complied with. My experience derived from my exposure to the relevant industries involved has been that industry—whether it is the construction industry or any other industry taking forward PFI projects—welcomes the initiative, recognises considerable value in it and finds an opportunity to participate in a fuller way than would otherwise have been the case. I believe that that provides value for money for the taxpayer and access to funding and investment which would not otherwise have been available.
I certainly would not have wanted to intervene in the little dispute between my noble friend Lord Bowness and the noble Lord, Lord Clinton-Davis, about the GLC, save to say that I am sure my noble friend is right, rather than the noble Lord. However, that might be seen as taking sides on the issue.
My noble friend Lord Mountevans also made some points on the PFI. I hope that I have managed to reassure him that the Treasury is sensitive to taking on board the various comments which are made in that respect. Of course, the PFI is in its early days. However, it has been a success and I believe that it will continue to be so; but that is only because it will be a proper partnership between government and industry which means that the Government must listen to the points that are made both in this House and, indeed, outside it. I give way to my noble friend.
Lord Mountevans: My Lords, I am most grateful to my noble friend for giving way. I believe that he answered many of the points put forward by the noble Lord, Lord Clinton-Davis. However, I used the word "risk" in my speech. Can my noble friend tell me what is the Treasury's attitude towards risk? Obviously, the private sector sees an opportunity and takes a risk. But, on the other hand, I believe that the Treasury sees such matters in a very different way, and that is a constraint.
Viscount Goschen: My Lords, the key to analysing such projects correctly and assessing whether they are proper and should go ahead largely depends on the risk against reward balance highlighted by my noble friend. We must look at all such schemes on their merits to assess whether a sufficient quantity of risk transfer has taken place. It is on that basis that the Treasury assesses the various schemes.
My noble friend Lord Mountevans also talked a good deal about the importance of buses. I would certainly have no difficulty in agreeing with him in that respect. Indeed, the bus is often an under-utilised asset. I believe that the recent transport document on London aptly realised the benefits that bus transport can have for the capital.
My noble friend asked about Westminster Bridge. I can confirm the date that he gave of about June 1997 for the completion of the works. We obviously hope that the project will manage to keep to its timetable.
The final subject on which I wish to comment is funding and investment. I imagined that the noble Lord, Lord Clinton-Davis, for one, and others, would open a debate about London Underground financing. I certainly

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argue that the Underground is not underfunded. Even allowing for inflation, investment in the core Underground in the 1990s has been twice as high as in the 1980s and three times higher than in the 1970s. On top of that around £2 billion is being spent on the Jubilee Line extension. The real underfunding of the Underground took place during the 1960s and 1970s when much of the present backlog built up.
I realise that we shall continue to have arguments about the level of funding of the London Underground. We believe that it is at an appropriate level. We certainly believe that the provisions of this Bill will enable London Underground to make fuller use of the private finance initiative to make sure that it obtains the full benefits, and that that provides maximum value for money for the taxpayer and the best service for the travelling public. Those must be our aims. I commend the Bill to your Lordships.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Deregulation (Motor Vehicles Tests) Order 1996
8.11 p.m.
Viscount Goschen Viscount Goschen rose to move, That the draft order laid before the House on 1st April be approved [17th Report from the Delegated Powers Scrutiny Committee].
The noble Viscount said: My Lords, the draft order amends the Road Traffic Regulation Act 1984 to remove the requirement for parking equipment and devices used by local authorities to be approved by the Secretary of State.
This requirement for approval is a cost to the parking industry and a disincentive to innovation. For a supplier with ideas for a new type of parking meter or ticket machine, it is not enough to find a customer local authority; under present arrangements he or she must also obtain the approval of the Department of Transport. Although the approval process has been made as straightforward as possible, it is not always understood by outsiders, and can be a significant bureaucratic obstacle. The approval requirement also involves a small but significant administrative cost to central and local government.
When parking meters were first introduced some 30 years ago the requirement for approval gave motorists a degree of protection against being charged with an offence based upon faulty equipment. We believe this measure has now outlived its usefulness. A range of British Standards for parking equipment is now available, and local authorities have wide experience of parking control. Meters do go wrong from time to time, but faults usually arise from poor maintenance or vandalism, which the approval process cannot protect against. All things considered, we have concluded that the approval process is now redundant and can safely be removed. I commend the order to your Lordships' House. I beg to move.
Moved, That the draft order laid before the House on 1st April be approved [17th Report from the Delegated Powers Scrutiny Committed]—(Viscount Goschen.)
Lord Clinton-Davis: My Lords, perhaps I may put the record straight. The Minister has spoken to the second draft order. We should have been discussing the first draft order, but I am perfectly happy to take it in that order if that is permissible.
Viscount Goschen: My Lords, no it is not.
Lord Clinton-Davis: My Lords, if it is not permissible, the Minister should make another speech.
Viscount Goschen: My Lords, I apologise to the House. I have been guilty of an oversight. I was so excited by the successful completion of the Second Reading of the previous piece of substantial legislation that I reached for the wrong document in my folder.
It might be appropriate if I were to say a few words that are more relevant to the appropriate Motion on the Order Paper. Perhaps noble Lords may reflect that my words may have wider meaning when we discuss the provisions of the second important order.
The draft Deregulation (Motor Vehicles Tests) Order 1996 amends the provisions of Section 48 of the Road Traffic Act 1988 in relation to MoT testing. The purpose of an MoT test is to confirm, once a year, that vehicles are in a roadworthy condition. Section 48 of the Act currently allows motorists to obtain MoT certificates up to one month before the expiry of an existing certificate without incurring any time penalty. In the case of public service vehicles, this concession is for two months. This means that the subsequent certificate can expire up to 13 months after its issue date (or 14 in the case of public service vehicles).
The concession does not exist in relation to the first MoT test certificate at the moment. A motorist may therefore be disadvantaged under the legislation as it stands if his vehicle is MoT tested before it needs to be, since the expiry date of the test certificate will be 12 months after it has been issued. Our objective in proposing the draft deregulation order is to extend the period of validity of the first certificate so that motorists would be able to take advantage of the existing concession which applies to subsequent tests.
We do not believe that the extension of the 13 month certificate concession would give cause for concern on either road safety or environmental protection grounds. We certainly have no evidence to suggest that it would. In our view there would be no significant risks in extending the concession as proposed, especially when it is considered that the vehicles which would be covered by our proposal are much newer than those which already benefit.
With further apologies to the House for my oversight, I cannot move this order now, but I can speak to it.
Lord Clinton-Davis: My Lords, the draft order ends an anomaly which ought to have ended some time ago. I am glad that this draft order has been laid by the Government and I fully support it. I am sorry that the Minister got into some confusion but his sheer glee at getting a Second Reading on a Bill which was largely uncontested is understandable and has clearly led to his state of mind, which is unfortunate but curable.

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I wish to address some of the points which were raised by the Select Committee in another place when dealing with these deregulation proposals. The main point relates to the period of consultation. I hope that this will not be taken as a precedent, certainly for more contentious issues. The consultation began on 7th February last year and finished on 27th February. That is on the whole a pretty short time—13 working days. The reason given by the department was that the proposal was likely to be uncontentious. However, the odd thing is that that short period of time was not reflected in the way in which the Government went about dealing with this proposal in terms of laying it before Parliament. It was nine months later that that occurred. I hope, therefore, that a greater period of consultation will be given in the main.
The committee paid a guarded tribute to the Department of Transport. It is right that the Department of Transport, which does not often receive tributes, should have that tribute underlined. It was stated that:
"On this occasion we are glad to see that the Department of Transport used first class post".
That, apparently, is not the practice of the Home Office. I hope that the department continues to use first class post when it is engaged in consultations of this kind. Subject to the point about consultation—I hope that the Government will not use this short period as a precedent—we welcome the draft order.
Viscount Goschen: My Lords, the less I say the better after the earlier inexactitude. On the issue of the consultation process, the time was short. The noble Lord is correct in that regard. However, the arguments were well rehearsed. The industry knew exactly what we had in mind and there were no surprises to come. However, I take the point that the noble Lord makes.
On Question, Motion agreed to.

Deregulation (Parking Equipment) Order 1996
8.20 p.m.
Viscount Goschen Viscount Goschen rose to move, That the draft order laid before the House on 1st April be approved [17th Report from the Delegated Powers Scrutiny Committee].
The noble Viscount said: My Lords, the House will not be surprised to hear that I do not intend to engage in a great explanation of this measure because by some fortuitous circumstance I believe that the House is already quite well informed about it.
Rather like the previous measure, the order removes a very small and unnecessary bureaucratic procedure. I think that it will be of benefit to all concerned. I beg to move.
Moved, That the draft order laid before the House on 1st April be approved [17th Report from the Delegated Powers Scrutiny Committee].—(Viscount Goschen.)
Lord Clinton-Davis: My Lords, the measure is not quite as simple as that. In my view the Minister should
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have dealt with the objection raised by the Automobile Association. It is an objection which I do not support but is nevertheless highly relevant.
The Automobile Association has suggested that the proposed change
"would lead to motorists having to prove their innocence".
I do not believe that that is the matter in law. The situation is this. The machine in question, if not approved by the Secretary of State—that is the purpose of the order—would be assumed to be working accurately in terms of evidence being given against the defendant. The evidence is simply admissible and is not conclusive. Perhaps the Minister will confirm that that is the department's understanding of the situation. In fact, a defendant could seek to prove that the machine was not working accurately.
I wish to raise another factor. I paid the department a tribute previously. Here I do not. It must stop saying silly things. I refer to the report of the Deregulation Committee of another place. The department was taken to task about the issue in evidence at page viii of the report. The department stated:
"If a user believes that a parking meter is not recording time correctly, he or she can check it quite simply by inserting a coin and observing how much time elapses before the penalty indication appears".
That seems a rather strange way of going about things. It takes no account of the time constraints that might affect the person concerned. I believe that the department was a trifle out of touch. As the report states:
"Members of the public cannot be expected to time parking meters to check that they are reliable; there must be some other means of ensuring that equipment performs satisfactorily".
One of the great virtues is that existing British standards will apply. I believe that that is one of the great safeguards. The other safeguard is that if a motorist, faced no doubt by an issue of principle, wishes to seek an acquittal from the court, he might be able to find some other ways of doing so. Having said that, I believe that the proposal is on the whole worthwhile, and we support it.
Viscount Goschen: My Lords, the noble Lord demonstrates without a shadow of doubt his skill as a lawyer by putting to me some of the difficult objections to the matter and then giving me the answers as to why they should be immediately dismissed.
The noble Lord's first point referred to a possible objection concerning evidence, court procedures and so forth. I know that the noble Lord understands the working of the law in the courts far better than I do. However, the question was as regards what happens if a meter is faulty. To what extent is that evidence taken into account?
If the motorist believes that he has been charged for a parking offence on a meter that is faulty, he should first complain to the local authority. Local authorities are usually quick to check meters and to withdraw charges if they find the meter to be faulty. If that fails, the motorist can take the case to court. Indication given from a parking meter is prima facie evidence. If other evidence—for example, that the meter was faulty—were put forward, the court would consider it. The approval

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process gives little protection against that sort of problem. That was essentially the noble Lord's argument when he turned his hat the other way round and argued against the objection. I commend the order.
On Question, Motion agreed to.

Trusts of Land and Appointment of Trustees Bill [H.L.]
8.25 p.m.
The Lord Chancellor: My Lords, I have it in command from Her Majesty the Queen and His Royal Highness the Prince of Wales to acquaint the House that they, having been informed of the purport of the Trusts of Land and Appointment of Trustees Bill, have consented to place their prerogatives and interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Bill read a third time.
Clause 9 [Delegation by trustees]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 1:
Page 4, line 27, leave out from ("shall") to end of line 29 and insert ("be presumed in favour of that other person to have been a person to whom the functions could be delegated unless that other person has knowledge at the time of the transaction that he was not such a person.
And it shall be conclusively presumed in favour of any purchaser whose interest depends on the validity of that transaction that that other person dealt in good faith and did not have such knowledge if that other person makes a statutory declaration to that effect before or within three months after the completion of the purchase.").
The noble and learned Lord said: My Lords, Amendments Nos. 1 and 2 both concern aspects of the power of delegation by trustees of land under Clause 9, and I believe it would be appropriate for me, with your Lordships' leave, to speak to them together.
Amendment No. 1 makes two changes directed to points raised on Report by the noble Lord, Lord Mishcon, concerning subsection (2) of Clause 9. That subsection provides protection for a person dealing with a beneficiary-delegate, whom, for illustrative purposes, I shall call A, by entitling him to presume, in the absence of knowledge to the contrary, that the beneficiary-delegate is indeed a person to whom the functions in question could be delegated.
The first change makes it clearer that the time at which there must be knowledge to the contrary is the time of the dealing with the beneficiary-delegate. The second change adds an element of protection for a successor in title of A, to whom I shall refer as B, modelled on, but not identical to, Section 5(4) of the Powers of Attorney Act 1971, with the following effect. When B purchases from A, and B's interest depends on the validity of A's transaction with the beneficiary-delegate, then if A makes a statutory declaration to the effect that he had no knowledge to the contrary at the time of his transaction with the beneficiary-delegate, it shall be conclusively presumed in favour of B that the beneficiary-delegate was a person to whom the functions could be delegated. A's declaration must be made either before or within three months after the date of completion of B's purchase.
Amendment No. 2 is intended to make it clear that, although the power of attorney by which functions are delegated must be made unanimously, so that where the power is revocable it may be revoked by any one of the trustees, this does not override Sections 4 and 5(3) of the Powers of Attorney Act 1971, which cover powers of attorney which are expressed to be irrevocable and given by way of security for a proprietary interest of the attorney or for the performance of an obligation owed to him. It is possible that such a power might be used, for example, in the context of an employee relocation scheme which operates by using a trust mechanism, and since such powers may in general be revoked only with the attorney's consent, Amendment No. 2 excludes them from the revocation provisions of Clause 9(3). Accordingly, where the trustees delegate functions to a beneficiary by a power which is expressed to be irrevocable and to be by way of security, the power may only be revoked in accordance with Section 4 of the Powers of Attorney Act 1971. I beg to move Amendment No. 1.
Lord Mishcon: My Lords, I am most grateful to the noble and learned Lord for the amendment. It deals with a point raised at Report stage. I ask forgiveness if I make a comment or two upon Amendments Nos. 1 and 2 in the light of information which was supplied to me after Report stage but not in time to put down any amendments conveniently at Third Reading.
A colleague of mine, Mr. Wolfarth—I believe that he has sent a memorandum to the noble and learned Lord's department—is much concerned with the possibility of fraud and the opportunity that ought to be given for the prevention of that fraud before the Bill finally reaches the statute book. I therefore raise the point, not for the matter to be dealt with tonight by the noble and learned Lord, but so that, in his wisdom, he may take these matters into account when the other place considers the Bill. I have no doubt that the Bill will go to another place after the House votes tonight.
Amendment No. 1 is important for the protection of purchasers and it is welcomed for that reason. However, references to "good faith" on the part of the person dealing with the attorney prompts one to reflect that powers of attorney could—admittedly as they can be at present—be used in furtherance of fraud. The third party protected by Clause 9(2) may be wholly innocent and needs to be sure of obtaining a good title. But where the attorney is party to a fraud on his principal, the consequence, as a result of the normal overreaching mechanism, is that the principal will lose his interest in the land and have only a claim against the fraudster for the cash proceeds, which is obviously of far less value as a matter of practice. In the context of a traditional express trust with successive interests, fraudulent use of a power of attorney granted by the trustees is perhaps unlikely, though clearly the risk increases somewhat when the powers that may be delegated are, by Clause 6, widened to include all the powers of an absolute owner.
However, Clause 9 is not confined to that context and perhaps the noble and learned Lord would consider, before the Bill goes to another place, whether any restrictions on the scope of the clause or express bars on the use of such a power of attorney to give effect to

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dealings with the attorney himself or persons connected with him are desirable in order to limit the risk of fraudulent use of powers granted under it.
Additionally, the requirement in Section 27(2) of the Law of Property Act 1925 for the receipt of two trustees in order to operate the overreaching mechanism is of fundamental importance in dealing with the aftermath of fraud. If it can be demonstrated that a proper receipt was not given in accordance with that section, which is often the case where signatures have been forged, then the defrauded party can recover his or her property. But if the receipt was good, the innocent purchaser is protected.
The noble and learned Lord the Lord Chancellor stated at Committee stage that subsection (7), as it now is, prevents an attorney under that provision from giving a receipt, even on a basis that he is acting by direction of the trustees. But given the crucial importance of the point in a fraud context, would the noble and learned Lord care to consider whether some more explicit drafting is desirable in order to emphasise that the attorney is not authorised under that clause to receive capital money or sign receipts for it?
My observations on Amendment No. 2 are much shorter, I am glad to tell the House. In the case of powers of attorney granted by way of security—the noble and learned Lord mentioned in his remarks on the amendment that such a case in some employee relocation schemes is quite common—is there any reason why automatic revocation is prevented under subsection (3) but not under subsection (4)? The security interest which is protected might be assigned. The original holder should remain able to exercise the power for the benefit of his assignee.
Those are merely additional remarks while dealing with the amendments. They are not intended as in any way against the amendments, and I have made them merely for the consideration of the noble and learned Lord.
The Lord Chancellor: My Lords, I am grateful to the noble Lord for his general support for the amendments. As regards the memorandum from his correspondent, we have received a copy and are considering it with the Law Commission which is the expert originator of much of this legislation, and with which we are in consultation on the amendments. I shall carefully consider the contents of the memorandum and its elaboration in the speech made by the noble Lord, Lord Mishcon. On that understanding, I hope that the amendments may be accepted.
On Question, amendment agreed to.
8.30 p.m.
The Lord Chancellor The Lord Chancellor moved Amendment No. 2:
Page 4, line 31, after first ("and") insert ("(unless expressed to be irrevocable and to be given by way of security)").
On Question, amendment agreed to.
Clause 11 [Consultation with beneficiaries]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 3:
Page 6, line 2, leave out ("of land").
The noble and learned Lord said: My Lords, Amendments Nos. 3 and 4 both concern the transitional arrangements in Clause 11(3) and I believe it would be
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appropriate to speak to them together. Amendment No. 3 is a technical drafting amendment which ensures that the wording of subsection (3) is consistent with that of subsection (2). Amendment No. 4 is directed to a point raised on Report by the noble Lord, Lord Mishcon, concerning the position in respect of the transitional provisions where new land is added to an existing trust after commencement of the Act; for example, by a further gift of land to be held on the same trusts. It seems right that such a referential trust should be treated on the same basis as the existing trust for the purposes of the transitional provisions, and Amendment No. 4 inserts additional wording into subsection (3) to ensure that this is the case. In other words, in a trust to which the amendment applies, the fact that other land has been added will not affect the position. I beg to move.
Lord Mishcon: My Lords, I am grateful for both amendments and support them.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendment No. 4:
Page 6, line 3, after ("disposition") insert (", or a trust created after that commencement by reference to such a trust,").
On Question, amendment agreed to.
Clause 19 [Appointment and retirement of trustee at instance of beneficiaries]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 5:
Page 10, line 7, after ("being") insert ("(or, if there are none, to the personal representative of the last person who was a trustee)").
The noble and learned Lord said: My Lords, I am intent on making more rapid progress now. Amendments Nos. 5 to 13 are essentially technical amendments which clear up a number of points on the provisions of Part II of the Bill concerning the appointment and retirement of trustees which were not quite met by the group of amendments to Part II which were accepted on Report. As with that earlier group, I believe that it would, with your Lordships' leave, be appropriate for me to speak to all of the remaining amendments together with Amendment No. 5.
Amendment No. 5 enables the existing subsection (4) to be deleted by moving the essence of that subsection into subsection (2), which now makes it clear that any direction to appoint a trustee or trustees under this clause is to be given to the trustee or trustees for the time being (which will include anyone being directed to retire at the same time) or, where there is no trustee left, to the personal representative of the last trustee on whom the trust will have devolved.
Amendment No. 6 makes a number of changes to the existing provisions of subsection (3) of Clause 19. The first part of the amendment recasts subsection (3) in order to provide more comprehensively both for the protection of a trustee who is directed to retire and for ensuring that sufficient trustees will remain after any such retirement to give receipts and administer the trust properly. The essence of the retiring trustee's protection is that he should not have to comply with the direction to retire by making a deed declaring his retirement until reasonable arrangements have been made, rather than merely offered, for protection of any rights he may have in relation to the

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trust, such as a right to indemnity for expenses personally incurred. This principle is now spelt out in the new subsection (3)(b). In addition, the retirement is not to be effective unless there will thereafter be either a trust corporation or two persons, who may be corporate persons or individuals, to act as trustees, and either the retiring trustee is to be replaced on retirement or the continuing trustees consent to his retirement.
The second part of Amendment No. 6 inserts a new subsection (4) which provides for the necessary action to be taken on a retirement under subsection (3) to vest the trust property in those who will be the trustees after the retirement, whether or not it is accompanied by a replacement appointment.
On Amendment No. 6, I should perhaps say in passing that on the substitution of the words in the amendment in the Bill, it looks as though "(a)" is required at the start of the wording. However, my understanding from Parliamentary Counsel is that it is a matter of the printing and that is the way it should read. So what is left in the existing subsection would remain as the opening phrase in the new provision and then the additions from the amendment will be inserted.
Amendments Nos. 7 to 10 make technical changes to the supplemental provisions of Clause 21. Amendment No. 7 makes it absolutely clear that the ability of a beneficiary to withdraw a direction before it has been complied with extends to both the situations set out in Clause 21(1)(a) and (b). Amendment No. 8 changes the transitional provisions for Part II of the Bill so that trusts created by wills are placed on the same footing as inter vivos trusts. Amendment No. 9 adds the words "by a disposition" to subsection (6) to ensure consistency with subsection (5); and Amendment No. 10 makes it clear that, where the settlor excludes Part II from applying to the trust and a direction has already been made but not complied with, the direction will thereby cease to have effect so that the trustees do not have to comply with it, but may of their own motion do what the direction says if they consider that to be appropriate.
Amendments Nos. 11 to 13 provide for minor technical changes in the Trustee Act 1925 as a result of the changes introduced by Clause 19 as amended. The effect of Amendment No. 11 is to remove the bar in Section 36(6) of the Trustee Act on appointing an additional trustee to serve with a trust corporation; and the effect of Amendment No. 12 is to change the provisions of Sections 37 and 39 of that Act concerning the minimum number of trustees to enable a departing trustee to be discharged, so that the requirement is for a trust corporation or at least two persons to remain, rather than two individuals as at present, so that corporate trustees are covered. These changes ensure consistency with Clause 19 of the Bill, and remove in each case what is at best an inconvenience and at worst a potential trap for the unwary.
Finally, Amendment No. 13 revises the existing consequential amendment to Section 40(2) of the Trustee Act 1925 so that it more clearly takes account of Clause 19 of the Bill as amended.
I beg to move Amendment No. 5.
Lord Mishcon: My Lords, I wish to pay a tribute to the noble Lord, Lord Meston. Before I entered the Chamber, he pointed out to me that (b) ought to be (a), (c) ought to be (d) and (d) ought to be (c). I thought that I had gone through this Bill with meticulous care. I had not noticed that, and I congratulate the noble Lord on his powers of observation.
I have only one brief comment to make. It relates to the last paragraph of the amendment. I make the remark in exactly the same spirit as I mentioned before and not in any way in opposition to the amendments to which the noble and learned Lord has just spoken. Does the noble and learned Lord the Lord Chancellor consider that third party rights such as those of the landlord with the benefit of a covenant against assignment of leasehold property require protection in the context of the replacement subsection which is the paragraph to which I have just referred? In particular, where he is able to withhold consent to an assignment only on reasonable grounds, is there a risk that it might be held unreasonable to resist an assignment where statute compels the assignor and assignee to enter into it if, apart from that, refusal of consent would be justified by reference to existing case law?
Does the noble and learned Lord consider, hereafter, that provision is needed for intervention by the court at the instance of third parties, such as mortgagees or insurers of trustees, in the event of evidence being available that a direction by beneficiaries under Clause 19 was given as part of a series of transactions involving fraud?
As I said, all my observations this evening have been directed to the prevention of fraud. I made those observations in asking the noble and learned Lord, with his usual courtesy and wisdom, whether he will consider these matters at a later stage.
Lord Meston: My Lords, I thank the noble and learned Lord the Lord Chancellor for clearing up my mystification at Amendment No. 6. Observant I may have been; wrong I certainly was. It is perhaps inevitable that I was going to be, given the care of the noble and learned Lord the Lord Chancellor, his officials and the draftsman in preparing the Bill. The treatment of the Bill seems to have been quite meticulous throughout.
The Lord Chancellor: My Lords, I am grateful to the noble Lord, Lord Meston, and the noble Lord, Lord Mishcon, for their remarks. The point made by the noble Lord, Lord Meston, was perfectly reasonable. It was so reasonable that my official concerned with the Bill had also raised it with the parliamentary draftsman. So it must have been a good point.
The other questions put by the noble Lord, Lord Mishcon, are both quite serious. I am not anxious to put into this Bill any protections that are not necessary. On the other hand there may well be a question as to whether the kinds of protection to which the noble Lord referred are necessary. I am considering the point further with the Law Commission with a view to deciding whether or not some further provision should be made.

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It is perhaps an interesting comment on the area of law with which this Bill is concerned that, although it was framed with very great care by the Law Commission and parliamentary counsel, it is an area in which practitioners have found, as it were, developing points as time has gone on. Obviously, Bills of this kind have to reach the statute book at some point and therefore there must be a cut-off for these observations. It is very much better that we should deal with them before the Bill becomes law rather than afterwards.
I say with all respect that the profession is getting better at doing that than it was some years ago. It underlines the fact that Law Commission Bills are now proceeding to the statute book. In years past, at least from time to time, the profession perhaps tended to treat such matters as rather academic exercises with no practical effect. They now know that there is a pretty good chance that Bills of this kind will reach the statute book, so observations and help have considerably improved.
I am very grateful for all the care that those who commented on the Bill have given to it. I am sure we are all anxious to produce an improvement. Also, anxious as some of us may be to preserve a good living for a certain profession, we wish to be sure that the Bill is as clear as it possibly can be so as to minimise the risk of unnecessary litigation.
On Question, amendment agreed to.
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 6 to 13:
Page 10, line 10, leave out from ("(2)(a),") to end of line 24 and insert—
("(b) reasonable arrangements have been made for the protection of any rights of his in connection with the trust,
(c) after he has retired there will be either a trust corporation or at least two persons to act as trustees to perform the trust, and
(d) either another person is to be appointed to be a new trustee on his retirement (whether in compliance with a direction under subsection (2)(b) or otherwise) or the continuing trustees by deed consent to his retirement,
he shall make a deed declaring his retirement and shall be deemed to have retired and be discharged from the trust.
( ) Where a trustee retires under subsection (3) he and the continuing trustees (together with any new trustee) shall (subject to any arrangements for the protection of his rights) do anything necessary to vest the trust property in the continuing trustees (or the continuing and new trustees).").
Page 11, line 6, leave out ("is not by writing withdrawn by any of them before being") and insert ("none of them by writing withdraws the direction given by him before it has been").
Page 11, line 19, leave out from ("disposition") to end of line 21.
Page 11, line 23, after ("Act") insert ("by a disposition").
Page 11, leave out lines 34 and 35 and insert—
("(b) a direction under section 19 or 20 which has been given but not complied with before its execution shall cease to have effect.").
Page 20, line 11, at end insert—
("( ) In section 36(6), for the words before paragraph (a) substitute—
"(6) Where, in the case of any trust, there are not more than three trustees-".").
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Page 20, line 11, at end insert—
("( ) In section 37(1)(c), for the word "individuals" substitute "persons".
( ) In section 39(1), for the word "individuals" substitute "persons".").
Page 20, line 12, leave out ("after the word "appointed" insert "or under section 19(2)(a)") and insert ("for the words "the statutory power" substitute "section 39 of this Act or section 19").
The noble and learned Lord said: My Lords, I spoke to Amendments Nos. 6 to 13 inclusive with Amendment No. 5. With the leave of the House, I beg to move them en bloc.
On Question, amendments agreed to.
The Lord Chancellor: My Lords, I beg to move, That the Bill do now pass.
Moved, That the Bill do now pass.—(The Lord Chancellor.)
Lord Mishcon: My Lords, I cannot let this occasion pass without saying to the noble and learned Lord who sits on the Woolsack how grateful the Law Society is for the co-operation that he and his department have given to the observations that it has made from time to time. There have been meetings where letters have been discussed. I believe that the Bill has benefited from those discussions and from the decisions that were reached.
I pay my own tribute to the appropriate committee of the Law Society, the Land Law and Succession Committee, and to the two sturdy members, Mr. Lockhart and Mr. Jarman, who kept me briefed and allowed me to appear to be extremely learned in a field of law where my ignorance might have been apparent, certainly to the noble and learned Lord the Lord Chancellor and to the noble Lord, Lord Meston, were it not for the adequacy of the briefing that I had been given.
Lord Meston: My Lords, I should like to associate myself with every remark just uttered by the noble Lord, Lord Mishcon, in particular in paying tribute to the responsive and careful way in which the noble and learned Lord the Lord Chancellor and his officials have dealt with the Bill.
I cannot help feeling that the Law Society has been rather more proactive than my branch of the profession. At an early stage of the Bill, I endeavoured to take soundings from appropriate quarters in Lincoln's Inn but important as it is for that area of the practising Bar, it did not seem to have caused a major tremor there. However, I do not doubt that there will be less room for unnecessary litigation as a result of the trouble taken with the Bill so far. We wish it well.
The Lord Chancellor: My Lords, I wish to associate myself with what the noble Lord, Lord Mishcon, said in relation to the Law Society committee and also the two particular members of it who came to a very hastily arranged meeting with me as well as attending a number of meetings with officials. I believe that the Bill is better as a result of that.

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I have the impression that the Bar thought that the principles of the Bill were wise. The detail and the amendments in which we have been involved have been mostly of a kind which would come more within the daily business of the solicitor branch of the profession than of the Bar. But I have no reason to suppose that, if some major improvement were required, the Bar would not be to the forefront in securing that, as it was, for example, in relation to the technical conveyancing Bill in the previous Session.
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I am grateful to the noble Lords, Lord Mishcon, and Lord Meston, for the part that they played. I believe that there is a deeper basis of knowledge in them than they were willing to acknowledge. I do not believe that their contribution was entirely due to the briefing. I am extremely grateful for their co-operation and the spirit in which the Bill has gone forward.
On Question, Bill passed, and sent to the Commons.
House adjourned at eight minutes before nine o'clock.