Lords Sitting of 16 December 1997

Preamble
The House met at half-past two of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Leicester.): The LORD CHANCELLOR on the Woolsack.

North of England: Grants
Lord Peyton of Yeovil Lord Peyton of Yeovil asked Her Majesty's Government:
Whether they are satisfied that the problems of the north of England are being treated with the same urgency and measure of financial resources as similar problems in Scotland and Wales.
Lord McIntosh of Haringey: My Lords, I can assure the noble Lord that the Government are concerned to ensure that the north of England is treated as equitably as other parts of the United Kingdom. However direct comparisons of public expenditure between the English regions and Scotland and Wales are not possible. Unlike Scotland and Wales, the English regions do not receive block grants to cover all services but are funded through a range of government programmes. Those programmes are generally allocated to reflect needs at regional and local level.
The Government are, however, committed to promoting growth, opportunity and fairness in the English regions. As a clear signal of their commitment, the Government published a White Paper, Building Partnerships for Prosperity, on 3rd December. That paper sets out the Government's plans for setting up regional development agencies.
Lord Peyton of Yeovil: My Lords, one admires the skill with which the noble Lord defends the Government's otherwise open goal. If it is in order, I wish also to add my congratulations to the Government on their perspicacity in using the noble Lord's skills. As he will not give us any information, I hope I may ask him how accurate it would be to say that government spending, local and national, in the north-east and the north generally is 30 per cent. less than it is in Scotland, and marginally less than that in Wales? Does the noble Lord realise that it seems to most people that the Government are bent on massaging through their policy of devolution by persuading the protagonists of that policy in Scotland and Wales that they can have their cake and eat it?
Lord McIntosh of Haringey: My Lords, flattery will get the noble Lord nowhere. In this case the first Answer that I gave was entirely accurate and does not allow the noble Lord to draw the conclusion that government spending in the north-east or the north of England—I am not sure which he wants to alight on—is 30 per cent. lower than in other parts of the country. As I made clear in my first Answer, we know the figures relating to some services, but figures relating to a large number
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of services, including, for example, the National Health Service and central Government's contribution to local authorities, are not calculated on a regional basis. There is no basis for the noble Lord to make the assumption that he does.
Lord Islwyn: My Lords, has the Minister seen the figures out today which show that all-cause death rates in Wales are 13 per cent. higher than in England; there is a 10 per cent. higher incidence of cancer in Wales; and for heart disease the figure is 17 per cent. higher? Bearing in mind that the gross domestic product in Wales is only 83 per cent. of the United Kingdom average, do not these figures suggest that some urgent attention needs to be given to the problems of Wales?
Lord McIntosh of Haringey: My Lords, I am sure that my noble friend quotes correctly figures that I have not seen. I have no reason to doubt that. He is certainly correct in saying that GDP per head in Wales is only 83 per cent. of that in England. However, if one takes identifiable general government expenditure—which is all that we can take and excludes the expenditure I have already referred to—the figure for Wales is 109.5 per cent. of the GB average.
Lord Barnett: My Lords, I am delighted to hear that my noble friend is concerned to help the north of England. I can perhaps suggest a way in which he may be able to do that, although I gather he is not willing—perhaps he will confirm this—to do anything to create a Barnett formula mark 2, which I have personally recommended to him. While he could not accept some of the figures explained so sensibly and at length by the noble Lord, Lord Peyton, does he accept that national income per head is now higher in Scotland than in many parts of the UK, including the north of England? In those circumstances, as he will not change the Barnett formula to mark 2, does he accept—is it going to happen?—that in the public expenditure review as the base line is not concerned with the Barnett formula, the formula will be included?
Lord McIntosh of Haringey: My Lords, as my noble friend knows, the Barnett formula mark 1 has been agreed as the basis for expenditure by the devolved Scottish and Welsh bodies. Although we continue to be interested in what my noble friend says about the Barnett formula mark 2, the mark 1 formula has many virtues—not that it is necessarily accurate in all respects—and used to avoid argument every year, but now it seems to attract argument every week. My noble friend is not correct about GDP per head in Scotland. That is 96.9 per cent. of the GB average, rather than the higher figure that he suggested.
The Earl of Lauderdale: My Lords, can the noble Lord tell the House whether a north-east regional assembly could or would make things any better?
Lord McIntosh of Haringey: My Lords, we are not at the moment proposing a north-east regional assembly. We are proposing regional development agencies which

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will take over a large number of the functions of central government. Matters relating to regional assemblies are included in our manifesto but I think that they are some way further ahead.
Lord Peston: My Lords, is my noble friend not puzzled by his reply to the Question of the noble Lord, Lord Peyton? Is it not the case that all public expenditure must take place somewhere? Is it not also the case that it must be accounted for? How does it happen in the age of the computer that the Government are still able to say that they cannot allocate these sums to the regions? That seems an impossible answer.
Lord McIntosh of Haringey: My Lords, of course all government expenditure must be accounted for at some stage, but decisions on where government expenditure takes place can be taken at a number of different levels in the administrative hierarchy. Some are taken very much at a local level; others are taken by regional hospital boards, for example, which do not correspond with other regions. Some decisions are taken centrally. If I was puzzled about this matter, it would concern our inability properly to calculate the subvention; in other words, the difference between public expenditure and what we receive from the regions in taxes.
Lord Mackay of Ardbrecknish: My Lords, will the Captain of the Yeoman of the Guard accept my congratulations, along with those of my noble friend Lord Peyton, on the way he handles all the various briefs that he is handed by the Government? Will he accept from me that it is a pretty pointless exercise to try to range Clydeside and Tyneside in competition with each other when both of them suffer from the same problems and require special help from the Government? Both of them received special help from the previous government and I certainly expect them to receive it from this Government. That way we get inward investment and growth in employment in those areas. In regard to the north of England, will the Minister tell the House what is the position in relation to the Samsung development? I understand that it has now been cancelled due to problems in the Far East.
Lord McIntosh of Haringey: My Lords, the noble Lord's first question should properly be addressed to his noble friend Lord Peyton, who, I suspect, was listening with his usual intensity. As to the noble Lord's second question, I do not know the answer; I shall have to write to him.
Lord Peyton of Yeovil: My Lords, I am not here to answer questions, but perhaps I might ask —
The Lord Privy Seal (Lord Richard): My Lords, I am very sorry, but we have already spent nine minutes on this Question.

Former Yugoslavia: Cost of UK Involvement
2.40 p.m.
Lord Renton of Mount Harry Lord Renton of Mount Harry asked Her Majesty's Government:
What has been the estimated total cost of the United Kingdom's involvement in crisis management
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in former Yugoslavia over the past five years, including the cost of the presence of British defence forces.
The Minister of State, Ministry of Defence (Lord Gilbert): My Lords, the additional cost of the United Kingdom's involvement in crisis management in former Yugoslavia from 1st April 1992 to 31st March 1997 was £1,442 million.
Lord Renton of Mount Harry: My Lords, despite that cost, does the noble Lord share my satisfaction at the near certainty that the international stabilisation force is now likely to stay in former Yugoslavia after next June, preferably with American troops in it? Again harking back to that cost, is the Minister aware that the other day a German Minister gave the total cost to Germany of involvement in crisis management in former Yugoslavia as 17 billion deutschmarks—nearly £6 billion? Is that not a reminder to us all that, however expensive enlargement of the European Union will be, it is much better, and cheaper in the end, to have central and eastern European countries within the European Union rather than fighting each other outside it?
Lord Gilbert: My Lords, I have absolutely no difficulty in agreeing with the noble Lord's last remarks. So far as concerns the presence in Bosnia of NATO forces, we hope that their stay will be limited. But it is certainly anticipated that we shall be there on the ground after next July.
As regards the comparison of figures, I have no idea on what basis the German Minister made his calculations. Ours are based on the additional cost, not the total cost, in which we are involved as a result of our presence in Bosnia.
Lord Randall of St. Budeaux: My Lords, on the question of costs as regards former Yugoslavia, is my noble friend aware that over the past several years the crisis has also given rise to 400,000 refugees? Does my noble friend agree with me that that makes a very strong case for enlarging the European Union?
Lord Gilbert: My Lords, I am not sure that I would necessarily draw the connection that my noble friend draws. He is certainly right in saying that there have been a great many refugees. I am glad to say that it is one of the benefits of the investment we have made in our presence in Bosnia that quite a few of them have found it safe enough to return to their homes.
Lord Avebury: My Lords, is the Minister aware that, in response to the criticisms made by Louise Arbour, the Yugoslav war crimes tribunal prosecutor, against France for harbouring war criminals in the French sector of the Serb enclave, the Quai d'Orsai said yesterday that the largest number of unarrested indictees were residing in the British sector? Does he agree that in view of the large sums of money being spent by the British

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taxpayer, we should be able to expect that British NATO forces will arrest war criminals and bring them to justice?
Lord Gilbert: My Lords, with great respect to the noble Lord, there is nothing in our record in that respect for which to apologise.
Lord Stoddart of Swindon: My Lords, my noble friend said that he expected British troops to be in Bosnia after June next year. Can he say how much longer after June next year he estimates they will be there?
Lord Gilbert: My Lords, I only wish that I could, but unfortunately it is not given to me to look that far into the future.
Lord Judd: My Lords, will my noble friend accept that many of us would want to pay the strongest possible tribute to the contribution made by British forces in former Yugoslavia? Has my noble friend been able to study recent remarks by the Secretary-General of NATO, who said that peacekeeping is one issue, but peace-making is another? Does he believe that we have the necessary resources in place to pursue peace-making as distinct from peacekeeping? By the same token, has he been able to study the comparative costs of the peacekeeping operation in Bosnia and other parts of former Yugoslavia and the pre-emptive deployment by the UN in Macedonia, which, I suggest, at a much reduced cost, has managed to preserve peace and reduce expenditure by the international community?
Lord Gilbert: My Lords, certainly there is every advantage in being able to be on the ground early so as to pre-empt the kind of situation that arose in Bosnia and has not so far arisen, I am glad to say, in Macedonia. I have no idea, speaking off the top of my head, what are the UN costs in Macedonia. Clearly my noble friend does. That is as far as I can go at the moment.
Lord Craig of Radley: My Lords, can the Minister give any indication as to how the future additional costs of our presence will be met? Will they be met entirely by Her Majesty's Government; or will additional resources come from the international community?
Lord Gilbert: My Lords, again the noble Lord tempts me to predict matters which I have no competence to predict. As I am sure he will know, the costs of operations in Bosnia are, as it is, in part shared by the international community both through the EU and through sharing NATO infrastructure costs.

Wales: Student Grants
2.45 p.m.
Lord Hooson Lord Hooson asked Her Majesty's Government:
Why the grants given to Welsh universities are £329 per student less than those given per student to English universities and £1,052 less per student than those given in Scotland.
Lord McIntosh of Haringey: My Lords, on the basis of the latest data for 1997-98, grant per full-time student
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in Wales is about £100 less than in England, not £329 as quoted by the noble Lord. The difference from the English figure is due to three main factors. First, Wales has had a lower research base and therefore less funding has been available from the research councils. Secondly, the mix of courses taught in Wales is somewhat less expensive than those in England. Thirdly, the higher education sector in Wales has been successful in attracting a strictly more than proportionate share of students as compared with England, thereby reducing the institutions' fixed costs per student.
Lord Hooson: My Lords, while I am grateful for that reply, is it not correct that an Answer given on 19th November in the other place gave the discrepancy as £159? Does it not suggest that the Welsh Funding Council is under-funded? Three of the universities in Wales are in rural areas. They have to attract students from outside their own, as it were, catchment area. Is it not very difficult for them to do so when the expenditure per student is £159 less per head than in England; £200 less per head than in Northern Ireland—again I refer to the Answer given in another place; and £1,000 less per head than in Scotland?
Lord McIntosh of Haringey: My Lords, of course there are differences between Wales, Scotland, England and Northern Ireland; and that is to be expected. Even without devolution to Wales, the Welsh Office has discretion as to how it spends the grant that is available to it. Whether it spends that money on higher education as opposed to industrial development, for example, is a matter for the Welsh Office, which could well explain some of the differences.
Regarding the larger difference in Scotland to which the noble Lord refers, I can confirm that, very broadly, his figures are correct. But in Scotland there are far more four-year degrees than in the rest of the United Kingdom. There is also a far higher proportion of very expensive courses such as medicine and dentistry.
Lord Merlyn-Rees: My Lords, I hope to take tea with the chancellor of the University of Glamorgan later today—a university of which I am chancellor! Will I be able to warm the cockles of his heart and tell him that the discrepancy will be put right and that someone will speak to the Welsh Office?
Lord McIntosh of Haringey: My Lords, I hope that my noble friend enjoys his tea. However, I do not think I can give him any assurance that the factors which underlie the differences in funding have changed and therefore that the funding itself will change.
Viscount St. Davids: My Lords, is the Minister aware that 70 per cent. of the students who attend the University of Wales come from elsewhere in the United Kingdom—that is, from overseas and England? How is Wales meant to compete in international markets when the universities are funded at a lower level in Wales than in Scotland?
Lord McIntosh of Haringey: My Lords, the noble Viscount is right in saying that a high proportion of

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students in Welsh universities come from outside Wales. But that does not mean that the funding per head, like for like, is any different. As I explained, Wales has a higher proportion of less expensive courses. Those are broadly arts courses as opposed to science and technology courses. Welsh universities and the University of Wales in particular have been successful in filling all the places on all their courses. That means that their fixed costs are more economical. I do not think it can be said that any individual student suffers as a result of the differences.

Unemployment Statistics: Collection and Presentation
2.50 p.m.
Baroness Williams of Crosby Baroness Williams of Crosby asked Her Majesty's Government:
What change they expect to make in the collection and presentation of statistics on unemployment to reflect more accurately the numbers of those unemployed and actively seeking work.
Lord McIntosh of Haringey: My Lords, in the summer the Office for National Statistics launched a wide-ranging public consultation about the future of labour market statistics. The results of the consultation were published in the October edition of the Office for National Statistics publication Labour Market Trends.
The director of the ONS is responsible for deciding the form, coverage and timing of release of ONS statistics. I expect him to make an announcement about ONS proposals for labour market statistics in the new year.
Baroness Williams of Crosby: My Lords, I thank the Minister very much for that Answer. I recall that he and other colleagues, when they were in opposition, said quite rightly that the employment figures given in this country could not be wholly relied upon. Given that his right honourable friend the Prime Minister made a promise at the Luxembourg employment summit that the United Kingdom would be advancing internationally comparable bases of employment in future, and acknowledging that actual internationally comparable statistics are probably 0.5 million higher than the official figures given by the so-called claimant benefit base, will the noble Lord say when we can rely upon new figures for unemployment which actually reflect the real position? Can he give the assurance that decisions on welfare-to-work will not be made on the basis of statistics that are not correct?
Lord McIntosh of Haringey: My Lords, without anticipating in too great detail the announcement which the director of ONS will make, I can certainly confirm that it is the intention of ONS and therefore of the Government to include International Labour Organisation comparable statistics in the monthly first release figures.
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However, as the noble Baroness knows, those are based on the labour force survey which is a survey rather than a census. Therefore, it is difficult to get them truly up to date, given any specific sample size and it is virtually impossible to get them for smaller regions or smaller local areas. Therefore, for that purpose it will be necessary to continue to show alongside the labour force survey figures the figures of claimant unemployment which will be called "claimant unemployment", in order not to confuse anyone. They are based on a census and therefore are available for each region. each local authority area and employment district.
Baroness Gardner of Parkes: My Lords, can the Minister confirm for me from what he has just said that all the previous statistics will be published in their previous form alongside the new ones? He said that some would be so published, but how will it be possible to compare like with like if the whole format is changed? Is the change of format simply to confuse us and try to prevent us from comparing the figures?
Lord McIntosh of Haringey: My Lords, on the contrary. I can certainly confirm what the noble Baroness said, that all the existing figures will continue to be published. There is no difficulty about that and no intent to cause confusion. Indeed, we hope that the monthly publication will contain a moving quarterly total from the Labour Force Survey, the most recent monthly figures of claimant count, including separate figures for those on the jobseeker's allowance, which is quite important, and also figures from employer surveys on those matters which can only come from them—for example, working hours. So I think the noble Baroness will find that the new first release which will start in April next year will be far more helpful than anything we have had in the past.
Lord Molloy: My Lords, is my noble friend prepared to consider seeking the views of the trade union organisations and the employers' organisations on what he said on this important subject?
Lord McIntosh of Haringey: My Lords, very wide consultation took place on the publication of figures in Labour Market Trends in May this year. It was open to trade unions and employers' organisations to comment on those figures. My understanding is that they did so. The results of the consultation were published in Labour Market Trends in October 1997. Perhaps I may add to my answer to the noble Baroness, Lady Gardner of Parkes, that the analysis of the relationship between claimant count and ILO count is made in a very interesting article in the November issue.
Baroness Carnegy of Lour: My Lords, can the noble Lord tell the House whether, when the new arrangements are made, there will be a clear figure for the number of people who are between jobs? The present method of counting has excluded that figure. If we have new figures, it will be important that we know

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the number of people who are merely looking for a job and will soon have one. At one time that figure was as high as 700,000.
Lord McIntosh of Haringey: My Lords, I do not think it is possible, in either a survey or a census, to predict whether anyone answering the questions will get a job in the next few weeks or months. However, the analysis of the Labour Force Survey includes details of the length of time people are unemployed. I believe that that gives the answer that the noble Baroness seeks. It is available from the Labour Force Survey. Whether or not it is included in the first release, there is no difficulty for the noble Baroness in obtaining it.
Lord Mackay of Ardbrecknish: My Lords, perhaps I may welcome the Captain of the Yeoman of the Guard to the "three-out-of-four club" since he has answered three out of the four questions today. I wonder whether on this Question he can do better than his noble friend Lady Blackstone yesterday in failing to answer the question put to her by my noble friend Lady Blatch. What is the current level of youth unemployment on whatever statistics the noble Lord wishes to use? What was the level of youth unemployment two years ago?
Lord McIntosh of Haringey: My Lords, I should have thought that the noble Lord could do better than that. I should have thought it was inappropriate in this House for him to abuse my noble friend for something that happened yesterday or indeed to ask me a question which bears no relationship whatever to the original serious Question put by the noble Baroness, Lady Williams.
Baroness Williams of Crosby: My Lords, I thank the noble Lord for his full replies which reflect his commitment to employment statistics which can be relied on. When he comes further to consider the issue of unemployment statistics, will he consider further definition within them? Is the Minister aware, for example, of the extent to which invalidity benefit was used as an alternative to unemployment benefit in an effort by the previous government to reduce unemployment statistics? Can he assure us that that kind of redefinition of unemployment will be examined closely and carefully when the new basis of unemployment statistics is brought forward in the spring?
Lord McIntosh of Haringey: My Lords, I can certainly give the noble Baroness that assurance. One of the reasons we did not immediately leap into action when we had the results of the consultation in October this year was that Ministers were concerned to ensure that all such matters, not just invalidity benefit but the potential effect of welfare-to-work, the new deal and all government programmes, should be openly reflected in the statistics which we produce. Our last concern and our last wish is to cover up any of those matters, as perhaps the noble Baroness was suggesting they were covered up previously.
Lord Davies of Oldham: My Lords, will my noble friend learn from the exchanges this afternoon the
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importance of having statistics which not only bear international comparison but also effectively bear comparison over time in order that we may see over a decade of Labour government, which seeks to create employment, the difference from the past 18 years?
Lord McIntosh of Haringey: My Lords, that is exactly why both before and after the election we have been keen to ensure that the International Labour Organisation definition as obtained from the Labour Force Survey is available, is used and is given greater prominence. I pay tribute to the previous Government for the fact that in 1992 they increased the sample size of the labour force survey from 60,000 a year to 60,000 a quarter, in order to improve the accuracy of the survey.
Lord Peyton of Yeovil: My Lords. despite the ferocity of the noble Lord's reply to my noble friend on the Front Bench, perhaps I may be allowed, quietly and with the utmost docility, to congratulate him on the skill he has shown this afternoon as the Government's goalkeeper.

Business
3.2 p.m.
Lord Carter: My Lords, at a convenient moment after 3.30 p.m., my noble friend Lady Hayman will, with the leave of the House, repeat a Statement that is to be made in another place on the Climate Change Summit in Kyoto. That will be followed by my noble friend Lord Sewel who will, again with the leave of the House, repeat a Statement on the Scottish Water Industry Review. I take this opportunity to remind the House that the Companion indicates that discussion on a Statement should be confined to,
"brief comments and questions for clarification".

Standing Orders (Public Business)
The Chairman of Committees (Lord Boston of Faversham): My Lords, I beg to move the first Motion standing in my name on the Order Paper.
The first part of this Motion tidies up Standing Order 62, which deals with sessional committees. The Procedure Committee proposed in its second report of this Session that the Broadcasting Committee should cease to exist and the House agreed to that report on 4th December. This Motion therefore deletes the reference to the Broadcasting Committee in the Standing Order. It also brings up to date the title of the Delegated Powers and Deregulation Committee, which was altered at the start of Session 1996-97.
The second part of the Motion introduces the proposed new Standing Order on the Joint Committee on Statutory Instruments, again on the recommendation of the Procedure Committee. The new Standing Order sets out the committee's existing terms of reference. The reason for introducing it is that it will simplify the procedure for appointing the committee at the beginning of each Session.

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It might be for the convenience of the House if I speak now to the second Motion, although I shall move it separately. I should explain that it supports the proposed new Standing Order. It would give the committee its present powers on a permanent basis, so removing the need for them to be granted at the start of every Session. I commend the order to the House.
Moved, That the Standing Orders relating to public business be amended as follows—

Standing Orders (Public Business)

  Standing Order 62
  Line 7, leave out "Broadcasting Committee";
  Line 9, leave out "Delegated Powers Scrutiny Committee" and insert "Delegated Powers and Deregulation Committee";

  After Standing Order 70
  Insert the following new Standing Order:
  Joint Committee on Statutory Instruments.
  70A. There shall be a Select Committee consisting of seven Lords, which shall join with a Committee of the House of Commons as the Joint Committee on Statutory Instruments, to consider:

  (1) Every instrument which is laid before each House of Parliament and upon which proceedings may be or might have been taken in either House of Parliament, in pursuance of an Act of Parliament; being

  (i) a statutory instrument, or a draft of a statutory instrument:

  (ii) a scheme, or an amendment of a scheme, or a draft thereof, requiring approval by statutory instrument;

  (iii) any other instrument (whether or not in draft), where the proceedings in pursuance of an Act of Parliament are proceedings by way of an affirmative resolution; or

  (iv) an order subject to special parliamentary procedure;

  but excluding any Order in Council or draft Order in Council made or proposed to be made under paragraph I of Schedule 1 to the Northem Ireland Act 1974 and any draft order proposed to be made under section 1 of the Deregulation and Contracting Out Act 1994; and

  (2) Every general statutory instrument not within the foregoing classes, and not required to be laid before or to be subject to proceedings in the Commons only; but not including Measures under the Church of England Assembly (Powers) Act 1919 and instruments made under such Measures;

  with a view to determining whether the special attention of the House should he drawn to it on any of the following grounds

  (a) that it imposes a charge on the public revenues or contains provisions requiring payments to be made to the Exchequer or any government department or to any local or public authority in consideration of any licence or consent or of any services to be rendered, or prescribes the amount of any such charge or payments;

  (b) that it is made in pursuance of any enactment containing specific provisions
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  excluding it from challenge in the courts, either at all times or after the expiration of a specific period;

  (c) that it purports to have retrospective effect where the parent statute confers no express authority so to provide;

  (d) that there appears to have been unjustifiable delay in the publication or in the laying of it before Parliament;

  (e) that there appears to have been unjustifiable delay in sending a notification under the proviso to subsection ( I ) of section 4 of the Statutory Instruments Act 1946. where an Instrument has come into operation before it has been laid before Parliament;

  (f) that there appears to he a doubt whether it is intra vires or that it appears to make some unusual or unexpected use of the powers conferred by the statute under which it is made;

  (g) that for any special reasons its form or purport call for elucidation;

  (h) that its drafting appears to be defective; or on any other ground which does not impinge on its merits or on the policy behind it, and to report their decision with the reasons thereof in any particular case.—(The Chairman of Committees.)

  On Question, Motion agreed to.

Joint Committee on Statutory Instruments
The Chairman of Committees: My Lords, I beg to move the second Motion standing in my name on the Order Paper.
Moved, That for the purposes of Standing Order (Joint Committee on Statutory Instruments) the following powers be granted to the Committee:
The quorum of the Committee shall be two;
The Committee shall have power to agree with any Committee appointed by the Commons in the appointment of a Chairman;
The Committee shall have power to appoint one or more Sub-Committees to join with any Sub-Committee or Sub-Committees appointed by the Commons; and the power to refer to such Sub-Committee or Sub-Committees any of the matters referred to the Committee;
The Committee shall, before reporting that the special attention of the House be drawn to any instrument, afford to any government department concerned therewith an opportunity of furnishing orally or in writing to them, or any Sub-Committee of the Committee, such explanations as the department think fit;
The Committee shall have leave to report from time to time.—(The Chairman of Committees.)
On Question, Motion agreed to.

Supreme Court (Offices) Bill
Read a third time, and passed.
Consolidated Fund Bill
On Question, Bill read a second time: Committee negatived. Then, Standing Order 44 having been dispensed with (pursuant to Resolution of 15th December), Bill read a third time, and passed.
Scottish Agricultural College Order Confirmation Bill
Read a third time, and passed.

Education (Student Loans) Bill
3.5 p.m.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Baroness Blackstone.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 1 [Transfer of public sector student loans to the private sector]:
Lord Tope Lord Tope moved Amendment No. 1:
Page 1, line 20, at end insert—
("(3A) The amounts that may be paid by the Secretary of State under subsection (3) shall not exceed one quarter of the amount of the original loans assigned under subsection (I).").
The noble Lord said: I shall not delay the Committee for too long with this amendment. I do not propose to repeat a Second Reading speech, though many of the points I made there are particularly pertinent to this amendment.
It is a simple amendment, but an important one to which reference was made at Second Reading and I make no apology for returning to it now, as I said I would. The Bill as it stands allows the Secretary of State to pay any subsidy he likes in respect of the sale of a loan portfolio. My amendment seeks to limit the subsidy to one quarter of the loan.
I suspect that my amendment will be familiar to the Minister because it is similar to an amendment moved by Mr. Stephen Byers, when he was in Opposition, during the passage of the 1995 Education (Student Loans) Bill. I believe he sought similarly to limit the amount of subsidy to one quarter. In moving that amendment in 1995 in Standing Committee B he said,
"The Bill does not restrict the amount of subsidy that could be made available to private sector institutions. We should not give private sector bodies a blank cheque. The Bill should contain some restriction to limit the amount of taxpayers' money that will be given
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to private sector institutions as an incentive—some might say bribe—to become part of the scheme".—[Official Report. Commons, Standing Committee B, 19/12/95; col. 93.]
I understand that the circumstances of this Bill are different from those of the 1995 Bill, but in my view the principle remains exactly the same. We should not allow a blank cheque. At our Second Reading debate on 2nd December the Minister said,
"we cannot reveal anything about the extent of the subsidy. After all, a commercial transaction is taking place and it would be quite wrong to reveal what the subsidy might be until those negotiations have been completed and the winner of the bidding process has been announced".—[Official Report, 2/12/97; col. 1277.]
I understand and accept that, and I am not seeking to press the Minister to say what the subsidy will be. We are seeking to put a limit on the amount of that subsidy so that it cannot be a blank cheque. If the scheme is running as successfully as we hope and are led to believe, then putting a limit of 25 per cent. on the amount of subsidy cannot be a problem. A subsidy of more than 25 per cent. will be a matter of real concern to Members of the Committee. That is something that we should know about.
That is the purpose of my simple amendment. It is not to restrict the hands of the Government or the Secretary of State in their negotiations; indeed, it could be said that it should strengthen their hands because bidders would know that there was a limit beyond which the Secretary of State was not permitted to go.
I hope, but with no great expectation, that the Minister will feel able to agree to the amendment. I look forward to hearing her comments and response. I stress that I am not expecting her to announce the extent of the subsidy, but merely to accept that it cannot be a blank cheque. There must be a limit on it; and that limit should be 25 per cent., as was proposed by her own party when in Opposition. I beg to move.
Lord Davies of Oldham: The mover of the amendment has already reflected the problem with regard to his case. He referred to a similar amendment having been moved in 1995 at the time of the Education (Student Loans) Bill's progress through the other place. The difference is quite clear. What was then being presented was a proposal with regard to the book on student loans against the background that privatising the loans would bring resources to the Government for higher education. The difference today is that we are working against a very tight schedule. What the Dearing Committee identified, and what vice-chancellors identified long before the Dearing Committee reported, was the parlous state of resources in higher education. Indeed, in the past six to eight weeks we have had a number of debates on higher education in which these matters have been brought sharply to the attention of the House.
The Government now need to make progress very rapidly. In fact, the noble Lord helpfully pointed out that the Teaching and Higher Education Bill, which is currently before the House, contains provisions to repeal the Education (Student Loans) Bill in its entirety by the end of this Session. That is how tight the timetable is. Against that background, the Government's hands

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should not be tied in negotiating with the private interests involved. We are well aware of the fact that the extent of private interests is not overwhelming. The previous government's attempts and the proposals in their Bill foundered because there were no takers for the stated course. The position is now transformed as a result of the Government's longer term proposals with regard to student finance. The Government are now involved in negotiations which will release significant sums of money to higher education immediately. There is no other easy way in which resources can be released within the timescale education needs.
I therefore suggest that the Government should be given freedom to negotiate their position without constraint. What the Government want to do is to strike a bargain that is of most benefit to public finances and higher education. The resuscitation of an amendment, which was moved in the other place by a member of my party in different circumstances, ought not now to be included as a conditioning factor with regard to the process.
Baroness Blackstone: This is a wrecking amendment in that it would effectively pre-empt the competitive bidding process which will determine the subsidy structure. Such a cap would render the scheme unworkable and do nothing to foster the public-private partnerships that we are, as a new government, now seeking to develop.
We are committed to working within the spending plans of the previous government for the next two years. That includes achieving the same level of receipts as they planned from loan debt sales. To achieve those sales we will need to pay a level of subsidy which, of course, while as low as possible, has to prove sufficiently attractive to the private sector so that it becomes involved in the bidding process. These loans are not made on commercial terms and subsequently cannot as a result be sold on a normal commercial basis either. An arbitrary cap on the amount of subsidy payable tied to the face value of loans and without consideration of such factors as the length of time it will take to recover the debt and the administrative costs involved would cause great difficulties for the bidders and act as a disincentive to participation in the sale.
The very generous deferment terms offered mean that many loans will live for a very long time. They are not usually written off until 25 years have elapsed. In many cases a subsidy amounting to 25 per cent. of the face value of loans will be payable well before repayment is completed. That would leave a heavy and unacceptable burden on the debt purchaser who would have to continue to hold the loans on his books and administer them without any recompense. That is an unattractive scenario which would adversely affect the level of bids if they were forthcoming.
We are now entering a crucial stage of the debt sale. The shortlisted bidders have exactly a month to make their firm bids. As I explained, they have a number of factors to weigh up in assessing the level of subsidy to bid for. In those circumstances, it would clearly not be sensible for the Government to do business with our
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hand already revealed. That would be the position if the subsidy position were put on the face of the Bill as the noble Lord, Lord Tope, has suggested.
As the noble Lord recognised—I am grateful for it—we cannot say what the level of subsidy will be until the competition has finished. But perhaps I may reassure him. It is a strong competition and we will accept the very best bid we can possibly get. The noble Lord should understand that the existing scheme is heavily subsidised. There would still be a cost to the taxpayer even if we retained the loans. We are changing one subsidy scheme for another and also transferring significant risk to the private sector while doing so.
The noble Lord, Lord Tope, referred to the 1996 Act and to an amendment which the Labour Party put forward in both Houses while in opposition. The 1996 Act had nothing to do with the measures we are seeking to introduce in this Bill. The 1996 Act sought to introduce a twin-track approach to student loans—a system of private sector loans held by banks and like institutions running alongside the current public sector loan scheme administered by the Student Loans Company. That proved an unattractive proposition. The financial institutions showed little interest in it and the then government had to admit as much. We were concerned that they would, in pursuing this rather misconceived policy, attempt to buy interest in it by offering an excessively generous subsidy package. That was why we sought to restrict the subsidy arrangements on that occasion.
Following what my noble friend Lord Davies of Oldham said, perhaps I may explain that we are putting in place a totally new system of financial support for students entering higher education from 1998-99. This requires new legislation; for example, to provide for income contingent loans collected through the Inland Revenue. The loans being sold have been made on a different basis under existing legislation, and the Education (Student Loans) Bill is needed to enable the debt sales to take place under that legislation.
The Teaching and Higher Education Bill allows for the repeal of the loans Bill, once enacted, along with the remainder of the existing loans legislation. Transitional provisions will be put in place to ensure that mortgage-style loans can continue to be issued to current students until their courses are complete. Repayment of loans taken out under the old legislation will continue to be collected in the same way as now. Both debt purchasers and the position of borrowers will therefore be protected. However, there will come a time when new loans are no longer being made under that legislation because all the students to whom it applied have left the system. It is a matter of good legislative practice that the relevant Acts should be totally repealed at that point. The current Bill provides for that to happen.
Loan agreements which were governed by the 1990 Act will of course continue to be binding on both parties once that Act is repealed. There will be provisions to ensure that the Secretary of State continues to have power to pay subsidies to the private sector in respect of the loans they have purchased. The purpose of the

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Teaching and Higher Eduction Bill is to put in place a new system of income-contingent loans for entrance to higher education from 1998-99 onwards. Those students will not be affected by the provisions of the Bill being considered today because their loans will not be governed by the existing student loans legislation.
As I said, the two sets of legislation are quite separate and will run parallel until the last student eligible for the current mortgage-style loan has left the system. I hope that that has clarified matters for the Committee.
But, as my noble friend Lord Davies of Oldham also rightly said, the circumstances of the legislation before us today are entirely different to the 1996 Act. We have short-listed four contenders for the debt sale. A total of seven major financial institutions are involved because in some cases a consortia is bidding. Several others were willing to bid but had to be excluded because they were not sufficiently competitive. There is no need for the sort of restriction set out in the amendment. The competitive tension we have created will, I believe, have produced the very best possible deal. Therefore, I ask the Committee to reject the amendment.
Baroness Blatch: Before she sits down and indeed before the noble Lord, Lord Tope, will the noble Baroness clarify the matter yet again for me? I am most grateful to the noble Baroness for the letter explaining the precise time when the legislation will be repealed and the reason for proceeding separately from the other Bill. I am not sure, however, that that is consistent with what the noble Baroness just said. If the Bill is to be repealed, as the noble Baroness said, with the coming into play of the Teaching and Higher Education Bill, where precisely in legislation is the protection both for the way in which the lending body operates, and its obligations under the law, and the protection for the borrower—that is to say, the student—during both the interregnum and the period which will continue for some years beyond the life of this Bill when the borrower will have an obligation to repay the loan?
Baroness Blackstone: I am grateful to the noble Baroness, Lady Blatch, for her question. As I understand it, although the Bill before us will be repealed, certain elements in it remain in place until the very last student on a mortgage-style loan scheme of the kind that exists at present, has gone right through the system. Therefore, the protection will remain in place in the legislation for all those students under the existing scheme. That is also a protection for those who are bidding for this particular debt sale. I hope that that makes the matter clearer.
Baroness Blatch: It is probably more my fault than the fault of the noble Baroness. If the Act is to be repealed, then it can only be repealed in part if measures within it are to remain. Can the noble Baroness say which parts of the Act will remain on the statute book? The particular measure in the new Teaching and Higher Education Bill repeals the whole of the Act and not just part of it. Therefore, where in legislation will the protection lie?
Baroness Blackstone: I am very sorry, but I do not believe that I can give the noble Baroness a clearer
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answer in terms of exactly which clauses will remain. I cannot tell the noble Baroness which of the clauses will continue to provide the protection. Perhaps I may write to her about it and clarify the situation. It is a somewhat technical piece of legislation and I want to be absolutely sure that I get it right rather than guess at it now. I believe that I know which part it is, but I do not want to cause confusion.
Baroness Blatch: I promise that this is the last time that I shall raise this particular point. The measure in the Teaching and Higher Education Bill is to repeal the whole of the Act. If some of it is to remain in place on the statute book, then there needs to be an amendment to the Teaching and Higher Education Bill. otherwise I am missing something.
Baroness Blackstone: I am not sure that that is the case. I believe that there is something called transitional arrangements. There is something which stays in place, which makes it absolutely clear to existing borrowers and any purchaser of the student loan debt that the legislation will be in place to protect them. I shall write to the noble Baroness on the matter.
Baroness Carnegy of Lour: Perhaps I may raise another point. I believe I understood the noble Baroness to tell us that there are four bidders short-listed in this exercise. That, of course, is very good news. Can she assure the Committee that there will be proper competition in this deal? Should, say, three bidders fall out and only one remains, what will be the Government's intention? Have they in their own mind set a level above which they cannot subsidise? What have they in mind should there be only one bidder?
Baroness Blackstone: There have been a substantial number of bidders in this competition, far above the four that were short-listed. Some of them put in insufficiently competitive bids. Many of the bids were relatively close. We have short-listed four on the assumption that they will all stay in the competition. None has given any sign of intending to withdraw. I am very confident that they will stay in. I do not believe that we have any need to be concerned or to worry about a situation in which only one bidder is left in the competition. Were that to happen we would have to consider very carefully what steps we ought to take. I am, however, confident that we have four very serious potential bidders for the sale of the student loan debt.
Lord Tope: I believe that we have strayed a little from the purpose of the amendment. Nevertheless, it has been a useful debate. I am grateful to the noble Baroness, Lady Blatch, for raising the point and to the Minister for sending me a copy of her letter to the noble Baroness, which I received shortly before coming into the Chamber. I have not yet had an opportunity to study it. But I remain as confused as—I hope she will forgive me—the noble Baroness, Lady Blatch. I hesitate to suggest that the Minister is in any way confused. I am sure that all will become clear and that she will again send me a copy of the letter of explanation. I recall

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being perhaps the first to spot that the Teaching and Higher Education Bill repeals the whole of the current Bill that we are considering today. I am still a little confused as to what it all means.
I must return to the subject of the amendment that I have moved. Both the noble Lord, Lord Davies of Oldham, and the Minister referred to the differing circumstances now and in 1995. I think that the most significant difference is one of opposition and of government. I suspect that what is causing the biggest difficulty with regard to the amendment is that in 1995 the Labour Party was in opposition but it is now the Government. I am told—I have yet to find out from personal experience—that things look different from the other side of the Chamber. That is probably the most significant different circumstance.
In moving the amendment, I said that I understood the differences between the previous Bill, now an Act, and this Bill. I must stress, however, that the principle is still the same. We should not be giving, to quote Mr. Byers in 1995, a "blank cheque" to the private sector. There should be some limit on the permitted subsidy. Whether that should be one-quarter, as I am suggesting, or some other figure which the Government might have wished to suggest, I do not know. But it should not be a "blank cheque".
I do not want to stray into another Second Reading debate, but I must take up one point raised by the noble Lord, Lord Davies of Oldham. He rightly said that higher education urgently needs more funds. As we said at Second Reading, this measure will not release funds to higher education. It is already built into the department's expenditure targets. If the sum is not realised, there will be further cuts in higher education or somewhere else in the education budget. The Bill will not produce any more money for higher education—and it is not intended to do so. Whenever it is suggested that that is the case, I, for one, will knock it on the head. I have stressed the reason why, in principle, I do not think that we should give a "blank cheque" and why I believe there should be some restriction on the subsidy.
I had hoped to be a little reassured by the Minister during our discussion. I did not really expect her to accept the amendment, but I had hoped for some reassurance. She has told us—and I accept—that there is strong competition. Therefore, I still wonder why the Government feel that providing for a 25 per cent. limit would be a constraint which would tie their hands and that, as the Minister suggested, this is a wrecking amendment. I do not believe that it is a wrecking amendment; it is certainly not intended to be. I fear that the Government are expecting the subsidy to be significantly greater than 25 per cent. If that were not the case, these provisions could not be seen as tying their hands.
I do not intend to press the amendment to a vote. It would not be proper to do so now. This has been a useful discussion and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1 agreed to.
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Remaining Clauses and Schedule agreed to.
House resumed: Bill reported without amendment.

Climate Change: Kyoto Conference
3.33 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Baroness Hayman): My Lords, with the leave of the House I should like to repeat a Statement made by my right honourable friend the Deputy Prime Minister in another place. The Statement is as follows:
"Madam Speaker, with permission I would like to make a Statement about the outcome of the United Nations Conference on Climate Change which I attended last week in Kyoto, Japan, along with my right honourable friend the Minister for the Environment.
"Man-made climate change is the greatest environmental threat facing the world today. In the UK, we have been suffering record drought for the last two-and-a-half years. This year the world experienced the highest average temperatures ever recorded. Terrible floods have engulfed central Europe. Droughts and storms have followed from this year's El Nino. Forest fires have caused deadly pollution in South East Asia and Australia. Our polar ice caps are melting; and only this weekend Mexico was hit by freak snowstorms.
"Already our sea levels are rising as ocean temperatures increase and the waters expand. If this continues some island communities will disappear into the sea. A third of the world's population live within 40 miles of the coast. Whole swathes of Britain's east coast could fall victim to rising sea levels.
"Man risks playing havoc with the world's weather systems. Unless we act now, we will be condemning our children to a world of drought and crop failures, rising seas, mass migration and spreading disease. Nature is no respecter of boundaries. This is a global problem demanding a global solution, and the very justification for the Kyoto conference.
"The main purpose of the conference was for the developed countries to set legally binding targets for reducing greenhouse gas emissions between the years 1990 and 2010. Success was by no means certain. Consensus had to be achieved among 160 different nations, and the conference started with the major players poles apart—the European Union proposed a 15 per cent. cut; Japan a 2.5 per cent. cut; and the United States zero.
"After long and gruelling negotiations, the protocol was agreed on Thursday morning, and will be open for signature in March. For the first time, developed countries, which account for over half the world's greenhouse gas emissions, will commit themselves to legally binding targets. This agreement will produce a cut of more than 5 per cent. in their emissions below 1990 levels by 2010.

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"I said before negotiations began that political will would be needed to deliver a successful agreement. The outcome of hard negotiations was that: America moved from zero to a cut of 7 per cent.; Japan moved from a cut of 2.5 to 6 per cent.; and the European Union set the top standard with a cut of 8 per cent.—which was adopted by 26 countries in total. This demonstrated beyond doubt that genuine political will did exist in all these countries, and a political breakthrough was achieved. I have placed in the Library a full copy of the Kyoto Protocol, which lists the figures for each country.
"There will be a chance to review, and if possible improve, the targets in four to five years' time. The targets will cover the six main greenhouse gases, not just carbon dioxide. The protocol also provides a number of measures which will help countries to achieve their targets. These include the possibility of trading in permits for greenhouse gas emissions; limited allowance for the absorption of carbon dioxide by forests, which act as so-called "carbon sinks"; and provision for developed countries to gain credit for helping developing countries curb emissions.
"There were fears expressed that these provisions might amount to loopholes in the agreement. That is why we, the United Kingdom, proposed the concept of a "window of credibility" for countries to demonstrate their firm commitment to the agreement; and it is why the European Union insisted that clear rules for all these provisions must be developed over the next two years or so.
"The conference fully recognised that the developed world must take the lead in curbing global warming. It is now necessary to discuss how developing countries can become more involved in the commitment to this process. That is necessary for long-term success in tackling global warming.
"The United Kingdom played a major role in ensuring that Kyoto was successful. I pay tribute to my predecessor as Secretary of State for the Environment, the right honourable Member for Suffolk Coastal, for the part he played in agreeing the Berlin mandate in 1995, which set the parameters for Kyoto; and indeed he was a member of the United Kingdom delegation.
"This Government have demonstrated their commitment to environmental issues at the highest levels. My right honourable friend the Prime Minister highlighted climate change at the G8 Summit in Denver, at the Earth Summit in New York, and at the Commonwealth Heads of Government Meeting in Edinburgh. My right honourable friend the Foreign Secretary has put the environment at the heart of his foreign policy and worked for a successful conclusion at Kyoto. At the request of the Japanese hosts, I myself chaired the meeting of developed countries which took place in Tokyo last month; and in the run-up to Kyoto I met the leaders of a number of developed and developing countries.
"I would also like to praise the efforts of the Prime Minister himself, who was in telephone contact with other world leaders to secure the final deal. I would
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also like to thank my right honourable friend the Minister for the Environment who played a key role with our European partners. Finally, this agreement would not have been achieved without the sheer professionalism and commitment of our civil servants. This was a really strong British team effort within a powerful European contribution.
"We must now turn our minds to implementation. The United Kingdom will assume the European Union Presidency at a crucial stage. Over the next six months we need to agree how the European target of an 8 per cent. reduction will be shared out between member states; policies and measures at a European level to help achieve those targets; and the EU position on rules for the various issues that I have mentioned. Indeed, my right honourable friend the Minister for the Environment is today discussing these very matters at the Environment Council in Brussels.
"Previously the European Union had agreed proposals to achieve an average 10 per cent. cut in emissions. There were differential contributions from different member states. For example, Germany agreed a minus 25 per cent. target. Portugal agreed a 40 per cent. increase. We now need to renegotiate these figures in the light of the outcome of Kyoto. We will not be certain of the legal target applying to the United Kingdom until that share-out has been determined.
"We will of course accept our legal obligation as a first priority, and still work to our aim of 20 per cent. We are already working on plans to achieve our targets taking into account the outcome from Kyoto. We will publish a consultation document next year. In setting out our programme we will consult widely, in particular with industry, local authorities and environmental groups who will all have key roles to play in delivering reductions. Let me reassure industry, as the Prime Minister did at our business summit, that we will not take unilateral measures which will unduly damage UK competitiveness.
"But tackling climate change is about opportunity and gain, not about pain. It goes hand in hand with building a better, more modern and affluent Britain. It is about improving transport systems in a way that will give us a better quality of life and cleaner cities; improving the housing stock, which will give us warmer, more comfortable homes and tackle fuel poverty, using less energy in a way that will make our industries more efficient; and ensuring that the UK is at the forefront of the world environmental technology market so that we create new jobs and business opportunities. That is good for the environment, good for the economy, good for people and good for jobs.
"In conclusion, I believe that Kyoto will be remembered in future as the place where the world, in a United Nations forum, faced a crucial decision and made the right choice. Failure, which many had predicted, would have condemned future generations to untold misery and disaster. We have taken the first, but only the first, crucial step to curbing climate

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change. There is still much to be done but I am certainly proud of the role that the United Kingdom has played in this achievement.
"We do not own this world. We hold it in trust to hand on to our children's children. We owe it to them to build on the Kyoto agreement to safeguard their future".
My Lords, that concludes the Statement.
3.43 p.m.
Lord Bowness: My Lords, I thank the Minister for repeating the Statement made in the other place. We on these Benches welcome the fact that there has been an agreement leading to the protocol. We offer our thanks to the right honourable Deputy Prime Minister and his colleagues for the work that they put into the negotiations in Kyoto. We welcome the agreement and protocol, not least because for the first time it provides a basis for a legally binding agreement to which developed countries are a party. It is the first international agreement of its kind which emphasises that this is a problem of global proportions and one that can be solved only by international co-operation and agreement.
Having said that, although one welcomes the agreement and the efforts made to reach it, one should not be over-enthusiastic about the outcome. In many ways it falls short of the expectations not just of the United Kingdom but of the European Union as a whole. It raises a number of questions about implementing the protocol, and indeed about government policy itself. I understand that the protocol provides countries with flexibility to meet their commitments, but detailed rules have yet to be decided. The Statement indicated the efforts that had been made in the European Union to set targets for individual member states. But beyond a statement that the rules within the protocol must be developed over the next two years it is not clear when and how, and what mechanisms are envisaged, to finalise these crucial rules without which the protocol can hardly be implemented.
Does the Minister agree that the average reduction of 5.2 per cent. is a long way below the European Union's initial target of 15 per cent.? An international system of emissions trading is to be welcomed, but are there not significant loopholes and details to be addressed before the scheme can be welcomed unconditionally? Is it not the case that since 1990 (which is the base) the United States could, for example, buy credits from Russia and other eastern European states which those states would not be using in any event and the reduction of 5.2 per cent. would not be achieved? Where a country is not in 1997 already using its credits the position may be worsened.
What about the Government's own commitment? The Statement indicates that the Government stand by their aim of 20 per cent. based on 1990 figures by the year 2010. What will the Government do to achieve that target? As far as I am aware, no firm proposals have been put forward since 1st May. If it is to be achieved by green taxes, can the Minister give a commitment that
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they will be matched by reductions in other taxes so that they are not another back-door tax rise? Further, do the Government agree that reducing travel distances, not just improving public transport, can play an important part in achieving their aims? Do they agree that that is yet another reason for ensuring suitable developments within town and city centres rather than further out on greenfield and green belt sites? Lastly, what are the implications of the Government's policy and targets to reduce emissions for their decision to defer the building of more gas-fired power stations and retain coal burners for the time being?
3.47 p.m.
Lord Ezra: My Lords, I too thank the Minister for repeating the Statement. I congratulate the Government on their role at the conference. It was quite clear at the start that the major countries were very far apart. The fact that as the result of the negotiations in which the United Kingdom obviously played an eminent role the target was substantially higher than the United States had originally proposed was quite an achievement. It may be that it is not near the European Union's figure of 15 per cent. Nevertheless, 5.5 per cent.—or 7 per cent. as it is for the United States—is very much better than nil.
However, as the noble Lord, Lord Bowness, points out, there is much work to be done. The Statement indicated that the agreement would be ready for signature in March. First, can one take it that signature will be automatic and no government will have second thoughts and not sign? Secondly. like the noble Lord, Lord Bowness, I am worried about the possible loopholes that have been referred to in the Statement. For example, there is a possibility of the more affluent countries purchasing permits for greenhouse gas emissions from less affluent countries. The effect of that would be relatively little net saving. The rules to be worked out will be absolutely crucial. When will that process be completed?
The European Union figure of 8 per cent. is below what the EU had originally proposed. The details are to be worked out in the near future. It is very satisfactory that the United Kingdom Government stand by their 20 per cent. objective. When I heard about the outcome of Kyoto I was a little worried about it. Therefore, I am glad that we shall go ahead with what we plan to do, irrespective of the targets that may be set for others.
Like the noble Lord, Lord Bowness, I shall refer to the measures recently taken to help the coal industry in its present difficulties. As the House will understand, I am thoroughly in favour of help being given to the coal industry. The measures agreed with the power stations, and the temporary moratorium on new gas-fired stations, are acceptable in present circumstances. There is however one aspect of the deferment about which I am concerned; that is, it includes a number of CHP plants, which, as the Minister will obviously be aware, are the most efficient available. They are twice as efficient as straightforward power plants.

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A number of those plants will be deferred under these arrangements. They amount to 700 megawatt of capacity. Deferring them for too long would make it difficult, if not impossible, for the Government's target of 5,000 megawatt of CHP plant to be in operation by 2000. I should like to end by asking the Government to think again about that aspect of the recent measures that they have taken.
3.51 p.m.
Baroness Hayman: My Lords, I am grateful to both noble Lords for the welcome they have given to what was achieved at Kyoto. Questions have rightly been asked about the detail. I shall try to deal with some of them in a moment. We should not underestimate the challenge that existed at that conference to reach agreement. That was both in terms of shifting the position of developed nations which were clearly below the challenging targets that this country and the EU were setting and achieving a consensus among all the participants. We are not talking about QMV or any sort of voting. The scale of the achievement was great.
In that context, the House must understand the work that has to take place over the coming months and years about the detail of the flexibilities. I understand the concerns, and, as the Statement made clear, this country is anxious that those flexibilities should not become loopholes. This is a sound agreement. The protocol offers countries a number of flexibilities which will usefully deliver their targets. The details of those schemes have not yet been agreed.
One of the challenges of our presidency of the EU will be to take forward the EU position on that. We shall have to work within that forum and with the US and others to develop the rules for emissions trading, joint implementation and calculation of sinks, and to ensure—this is the key—that they become useful ways of delivering reductions and not loopholes to prevent countries from delivering reductions. Those are the aims. How we achieve them is something that we shall have to take forward in the detailed negotiations that are to come.
It was made clear in the Statement that this was very much a first step. The noble Lord, Lord Bowness, accused us of being over-enthusiastic. I do not think that we are being over-enthusiastic. We are marking the achievement of having legally binding targets for the first time, without suggesting in any way that all the solutions have been reached or that all the details of how we are to achieve those challenging targets have been arrived at.
We were asked why the EU accepted a reduction from its own 15 per cent. target. That was always a negotiating figure and conditional upon other developed countries making similar efforts. The tough negotiating line that the EU took was instrumental in forcing the US and Japan to raise their offers. We still agreed to take on a slightly higher target. At the end of the day the judgment was that the most important thing was to reach an agreement that can move us all forward in the fight against global warming.
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I was asked about the Government sticking to their own 20 per cent. target. We shall do that because we believe that any action taken to reduce greenhouse gas emissions is a move in the right direction. As I said earlier, far too much of the debate has centred upon the cost of reducing emissions. There will be real benefits to the UK from action to tackle climate change. It will give us a more efficient and less car-dependent transport system. I say to the noble Lord, Lord Bowness, that we need to improve public transport and to look at the interaction of land use planning with transport policies if we are to achieve reductions in greenhouse gas emissions and the integrated transport policy for which we are looking. It gives us opportunities for energy savings for business and consumers and new jobs and market opportunities for more efficient technologies.
Our domestic target will ensure that we continue to lead by example in persuading others to take on the more ambitious targets needed in the longer term. Kyoto was a justification of us and the EU setting challenging targets.
I was asked about the coal industry. We are looking for a balanced climate change programme. We will not let one sector pick up all the costs of delivering our environmental objectives. There are many options for reducing emission levels: transport, energy efficiency, the greater use of renewables and CHP. I take the point made by the noble Lord, Lord Ezra, that it is important that we safeguard the achievement of that target within the recently announced review of Section 36 consents. They will have minimum impact on the current emissions projections. We need to await the outcome of the review before we can judge whether the final impact will be more significant.
There is an increasing anxiety about the growing and continuing reliance on gas, which has been raised by a number of people. We need to establish what part coal-fired generation should play in maintaining a secure electricity system. That review is driven by the Government's concern over security of supply, not by particular fuels. With regard to the detailed programme for the achievement of this country's targets, we have first to work out, within the EU, what this country's contribution will be within the overall EU target. We will then have to set ourselves a programme, upon which we shall be consulting early next year, as to how we will achieve our legally binding targets and start meeting our aim of a 20 per cent. reduction.
3.58 p.m.
Lord Renton: My Lords, I welcome the all-party support which the Government have and deserve. Throughout the world one of the major causes of air pollution is the burning of oil and petrol in the ever-increasing number of motor vehicles. Will the Government bear in mind that there are other ways of propelling motor vehicles; for example, by electricity, non-polluting gases, and as one sees in the newspaper today, hydrogen and oxygen activated by two electrodes is a method being developed by the Ford Motor Company at a cost of £600 million? Will the

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Government set an example to the world by encouraging the development of all those alternative methods of propelling motor vehicles?
Baroness Hayman: My Lords, the Government have already set something of an example through the Government Car Service and its use of alternative fuels and in the announcement recently made by the Prime Minister of the creation of a cleaner vehicles task force. That will set up a new partnership between government and industry to promote the production and sales of cleaner vehicles. Encouraging the uptake of more fuel-efficient and greener cars will be, as the noble Lord pointed out, an important contribution towards reducing CO, emissions from road transport, not just in this country but—I take his point—world-wide.
It is important that we take the lead in respect of the environment and so that we have the opportunity to exploit our own technology in this area and create business opportunities. We must examine the use of fuel cells. The Government are doing that in collaboration with industry, supporting research on fuel cell technology through the DTI's Advanced Fuel Cell Programme, and examining the alternative role which fuel gases might play.
Lord Moran: My Lords, were there any signs at Kyoto that China and India, whose roles in this area will be immensely important in the near future, will be prepared to restrict their emissions in due course?
Baroness Hayman: My Lords, the framework set in 1995 for Kyoto was about the contribution of the developed nations. Industrial nations have been the major cause of rising global temperatures during the past 100 years and must take the lead in tackling climate change.
However, the noble Lord is right because we need to look for an increasingly global solution to a global problem in respect of which the players will change over time. That is why during the next few years we will be working to involve developing countries more closely in international efforts to cut emissions. We will do so in a way which recognises a common, if differentiated, responsibility on all countries to act in this field. It was recognised at Kyoto that progress in the developing countries will be important in ensuring that the US ratifies the protocol.
Lord Hardy of Wath: My Lords, while recognising that the agreement is bound to be greeted with doubt and pessimism, would it not be appropriate for this House to applaud both the reference to the role of trustee and also to pay tribute to the efforts of Her Majesty's Government in the vital role which they pursued in Kyoto?
Is it not regrettable that the previous Government ceased to encourage research in clean coal technology, which was making great strides? Could that be resumed? Will the Government accept that if Britain is to take a reasonable share of the new markets they might take some initiative to bring industry together in order to
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ensure that, having given a lead and having set an example, we have a reasonable share in any forthcoming commercial advantages?
Baroness Hayman: My Lords, I am grateful to my noble friend for his comments about the UK's role, in particular to the role played by my right honourable friend the Deputy Prime Minister, who was a key figure in ensuring that the agreement was reached.
The Government attach considerable importance to the development of clean coal technology, particularly for application overseas where the main market for the technology in the next decade will be. We are currently undertaking a detailed review of the UK's clean coal technology requirements in consultation with industry. We are continuing to support the R & D programme aimed at developing clean coal technology. The DTI is actively encouraging industry and universities to work together to maintain UK expertise and know-how.
Lord Naseby: My Lords, do Her Majesty's Government believe that the decisions taken at Kyoto will prevent a further rise in sea levels, particularly in relation to the importance of that problem to the Maldives, where a six foot rise would see the end of that relatively new member of the Commonwealth?
Baroness Hayman: My Lords, the noble Lord is right to draw attention to that threat to the island nations. Kyoto presented an opportunity for stabilisation where otherwise there would have been enormous increases in emissions with the consequent effect on sea levels which we have seen. It is difficult to predict exactly what will happen. That is why it is important to continue monitoring the effects of climate change while taking measures which will ensure that we do not have the unbridled increases in emissions of the past.
Lord Carver: My Lords, as chairman of the sub-committee of your Lordships' Science and Technology Committee which reported on the greenhouse effect some years ago, I support the Government's achievements at Kyoto. I do so despite all my reservations, which were expressed by the noble Lord, Lord Bowness.
As the principle of tradeable permits has been accepted—I have great reservations about America picking up credits from Russia—will the Government consider introducing them in respect of emissions in this country? I must admit that our committee's report did not support that proposal. Furthermore, as nuclear power is the most suitable method of producing electricity as regards the greenhouse effect, will the Government do more to encourage its development?
Baroness Hayman: My Lords, the programme and measures which we introduce in this country must be framed in the light of decisions taken within the EU in developing policies post-Kyoto and of our legally binding targets. However, I note the noble and gallant Lord's comments about the possibility of tradeability in emissions within this country rather than internationally.

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In 1996, nuclear power generated about 30 per cent. of the UK's electricity. Increased capacity and improved productivity have helped the UK to limit its emissions of greenhouse gases. Provided that high standards of safety and environmental protection can be maintained, we believe that it should continue to do so.
However, the amount of nuclear power in the UK's energy mix is essentially a matter for the electricity generators. We believe that at present there is no case for government intervention in favour of the construction of new nuclear power stations.
Lord Allen of Abbeydale: My Lords, must the United States Government obtain the concurrence of the Senate before they can ratify the protocol? If so, is there a belief that that concurrence will be obtained?
Baroness Hayman: My Lords, the clear view which came out of Kyoto is that the US administration were fully committed to the deal which was agreed. The next two to three years will give us a window of credibility for ensuring the meaningful participation of developing countries and developing rules for the implementation of mechanisms allowed for in the agreement. Those two aspects will be crucial in ensuring that the US is in a position to ratify the protocol. That will be the key. If we can get those aspects right we are confident that the US administration will ratify the protocol.

Scottish Water Industry Review
4.8 p.m.
The Parliamentary Under-Secretary of State, Scottish Office (Lord Sewel): My Lords, with the leave of the House, I will repeat a Statement which has been made in another place by my right honourable friend the Secretary of State for Scotland. The Statement is as follows:
"With permission, Madam Speaker, I wish to make a Statement about the outcome of the Government's review of the Scottish water and sewerage industry.
"As honourable Members will know, our manifesto contained a commitment to return the Scottish water industry to local democratic control. In my Answer of 5th June, I said that I had asked my officials to conduct a review of the water industry and to report to me by November, which they have done. The review team had extensive consultations with the three water authorities, CoSLA and the Scottish Water and Sewerage Customers Council. We also issued a public consultation paper, which produced 91 responses. I am very grateful to all who responded so constructively, and I shall place their responses in the library of St. Andrew's House. The review team also held discussions with a variety of other interests and commissioned research into water industry models across the world. We listened very carefully to what has been said before reaching our conclusions.
"In conducting the review we were guided by a number of important principles. Apart from the central theme of improving democratic
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accountability, we also wanted to facilitate investment, promote efficiency, ensure continuity of public water supplies, protect public health and minimise disruption to the industry. The importance of these principles, and the importance the industry has for all of us in our day-to-day lives, has been demonstrated only too dramatically by events in recent days in the West of Scotland. These events are very serious, not least in terms of the severe dislocation caused to everyday life for some 60,000 people. I can announce today that Mr. Robert Fraser, a distinguished figure in the water industry and until recently Director of Water and Drainage for Borders Regional Council, will lead an exhaustive enquiry into the circumstances. I have asked Mr. Fraser to address the following points: first, to review the causes, nature and extent of the disruption to public water supplies in the area served by Burncrooks water treatment works, including the impact on the vulnerable sectors of the population, food industries and other water users; secondly, to review West of Scotland Water Authority's response to the incident; thirdly, to consider the lessons to be learned for the future from such an event. In particular, whether advice to the public needs to be given at an earlier stage, whether better arrangements need to be made for the provision of alternative supplies of drinking water, and whether improved arrangements are required for co-ordination within the public authorities, and with the media; and, fourthly, report and make recommendations.
"I fully understand the great public concern and the sense of irritation over this incident. I have spoken personally to both the Chief Executive and Chairman of West of Scotland Water today. Contamination levels are falling steadily, and I understand that 17,000 out of the 22,000 households originally affected now have clean water. I have been assured that lessons will be learnt, but I shall want to look hard at Mr. Fraser's report. Because of the urgency of getting the facts and learning the lessons, I am anxious to have a tight but realistic timetable, and have therefore asked for the report to be completed by the end of March. I shall not make judgments before I see the report, but if further action is required I shall not hesitate to take it.
"This episode does, nevertheless, serve to remind us that the water industry faces two immediate and major problems. First, there is the question of water purity, with the stark fact being that the purity of Scottish water is far down the UK league; indeed, the three authorities are in the bottom five when comparisons are made across the UK. The second is the chronic need for investment, especially in sewerage, to meet the requirements of European directives. The fact is that while the period of local authority control is looked back on as a period when the ownership of the industry was most generally acceptable, we have to accept that the infrastructure, often Victorian, was allowed to decay, and the consequences now mean that very great sums are required to bring the industry to a satisfactory level.

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We have to consider how we can best assist the industry in the task it has to meet the real demands ahead.
"I turn now to the various options which emerged during the review. We looked carefully at a wide range of proposals for the industry. Splitting the three authorities up between the 32 separate unitary councils was quickly ruled out. It is clear that disturbing the three authority structure would have disproportionate costs.
"A leading option, however, was to seek to improve accountability by transferring responsibility for water and sewerage services to joint boards of local authorities. Joint boards can be an effective way of providing strategic services, and the water authorities undoubtedly provide a vital public service. However, the water authorities are also large businesses with massive investment requirements, and just three authorities cover Scotland's 32 local authorities. I have therefore had to reject this approach. The last local government reorganisation made these options virtually impossible.
"We also carefully considered the imaginative case advanced by some consultees to convert the public water authorities into private, non-profit distributing companies such as mutuals. Such bodies would be freed from the capital controls of the public sector. But at a cost. That cost would be freeing them from answerability to any democratic body. I do not believe that is what the Scottish people want. It would be entirely outside the public sector—effectively it would be privatised. A mutual would be nominally controlled by its membership, but how effective control over the boards would operate is much less clear. I am also not convinced that a mutual, monopoly water authority would be under sufficient pressure to be efficient, as all experience tells us that individual customers would not be motivated to protect their interests. Nor am I convinced that unwelcome pressures to demutualise could be avoided. In the short term it would be very disruptive for the industry. I have therefore also had to reject this way forward.
"Despite this, it is clear to me that, if the investment needs of the Scottish water industry are to be met at a cost the consumer can afford, we shall need to harness private capital and expertise, within a framework of continuing public accountability. Let me first deal with the crucial issue of accountability.
"Since we launched the review, the Scottish people have given a resounding endorsement to the parliament. Our White Paper on Scotland's parliament made clear our concerns about the number of public bodies in Scotland being run without clear democratic oversight. It said that we saw the new parliament as the means of bringing them under strengthened democratic accountability. Responsibility for the water and sewerage industry will pass to the Scottish parliament. In the longer term it may wish to look again at some of the arrangements for change, but these could not and should not be
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options for today and tomorrow. In any event. I would expect that it will wish to allow the system to settle and perform before considering any further options.
"The Scottish parliament will be able to bring the water authorities under the proper level of scrutiny that a modern democracy demands through its oversight of the Scottish executive. This is the best way of delivering the will of the Scottish people for their water industry to remain unambiguously in public ownership and to be clearly democratically accountable.
"As well as becoming more accountable, I wish to see the water authorities become more responsive at a local level. As part of developing local responsiveness I shall ask the water authorities to build further on their links with the local authorities and community councils in their areas, which will be helped by the community planning system we are shortly to introduce. I also look to the water authorities to get closer to their customers and to other important local stakeholders including environmental interests. I shall very shortly issue a direction to the water authorities to review their systems for involving local interests, particularly local authorities, and to improve and strengthen these systems. I also propose to place a statutory duty on the water authorities to consult with the local authorities whose electors would be affected by major decisions. This should improve the water authorities' responsiveness to the concerns of local communities.
"Moreover, I can today announce new appointments to the water authority boards. Ian Preston and John Robertson. chairmen of the East and North Water Authorities respectively, will demit office at the end of March. I am very grateful to both of them for their good work and public service. In the east, Councillor Robert Cairns will take over, and in the north, Councillor Colin Rennie. John Jameson remains chairman of the west authority. In addition to the two new chairmen, I am appointing as new members in the east Councillor Jeanette Burness, Councillor Thomas Dair, David Bleiman, and John Broadfoot; new members in the west are Councillor Gerald Carroll, Councillor David Munn and Jane McKay; and in the north I am appointing Nigel Hawkins as a new member. I am also reappointing a total of seven current members to the boards. These appointments bring the number of local councillors on boards up to 16 out of the 33 members, excluding chief executives—i.e. roughly half the total. Of these 16, six are Labour councillors. I have made full details of the appointments available in the Library.
"One aspect of local responsiveness I wish to explore further is how best to help with the problems of water supply and sewerage faced in many of our remoter rural areas. I have therefore asked officials to review whether or not there is a case for reintroducing rural grants to help with such problems.
"As I have already said, the water industry review has again emphasised that the industry is in need of very substantial investment if the Scottish people are to have the quality of water industry that they deserve.

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But that investment will have to be paid for. Put simply, this means that all of us who are water consumers will have to pay more in the years ahead. Let me be quite clear. This investment is needed to bring the quality of our water up to the standards south of the border, to protect our beaches, rivers and seas, and to renew the infrastructure gifted us by previous generations which more recent generations have neglected.
"The private finance initiative is paying off by helping us to acquire additional resources to meet EC environmental deadlines, and in identifying innovatory ways of making savings in the capital and operating cost of projects. The water authorities have substantial plans for PFI projects, amounting to some £600 million, to help meet their investment needs in the years ahead. This Government are committed to developing opportunities for public private partnerships. I encourage the water authorities to be innovative with such partnerships while working within the framework of strengthened democratic control I have outlined.
"The Scottish people will need safeguards to ensure that money raised is well spent. There was consensus amongst the major consultees that the current division between price regulation by the customers council and efficiency regulation by the Scottish Office has proved untenable. I propose to create a new position of a regulator responsible for all aspects of economic regulation and for promoting the customer interest.
"The water authorities will be under legitimate democratic oversight, but they are still monopolies, and the new regulator will have operational independence to ensure that the customer gets the best possible deal. The regulator will be accountable to the Scottish parliament through the Scottish executive. To safeguard the independence of the regulator's role, the position will be established in statute.
"The functions of the current customers council will be transferred to the new unified regulator, and the council in its current form wound up. However, it is essential that customers continue to have a strong independent voice. I therefore propose to develop the role of the three customers council area committees as the champion of the individual customer. These committees in their developed form will be accountable to the new regulator, and will provide a point of contact for the public.
"I have also listened carefully to representations made about the damaging uncertainty for the industry of the current one year time horizon for price and EFL decisions. I therefore propose that there should be a longer-term pricing framework, and we should aim to ensure as stable a borrowing framework as possible, despite changing circumstances in successive public spending plans.
"Finally, I have also listened carefully to the views expressed to us during the review about the contribution that people with business experience have made to the boards of the new public authorities, alongside councillors. As will be clear from the appointments I am announcing I judge it essential that
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we continue to draw on the expertise that the private sector can offer to ensure well balanced and effective boards.
"In sum, my proposals represent real local responsiveness, and real democratic control. They show that we have listened very carefully and thoughtfully to what has been said during our extensive consultations. We are seizing the opportunities created by the Scottish parliament to have more democratic control of the industry, and to find the best way forward given the particular sensitivities of this industry. We shall not play politics with Scottish water.
"My proposals to change the system of regulation will require legislation, and the Government will look for an appropriate opportunity to legislate. I am also publishing today a factual document that I asked the review team to prepare setting out in more detail the outcome of the review. Copies will be available from the Printed Paper Office".
My Lords, that concludes the Statement.
4.25 p.m.
Lord Mackay of Ardbrecknish: My Lords, I am grateful to the noble Lord, Lord Sewel, for repeating the Statement made by his right honourable friend Donald Dewar in the other place. I must say that the 16 minutes of Statement could perhaps be encapsulated in two words, "about turn", because that is exactly what this Statement is.
Before I turn to the "about turns" perhaps I may welcome the part of the Statement which is slightly aside from the framework for Scottish water; that is, the appointment of Mr. Robert Fraser to inquire into the circumstances surrounding the problem of the water supply in north-west Glasgow and the Bearsden area, and so on, where diesel was spilt into the supply system. That has meant that a number of people have discovered that water is an essential part of our everyday life. We have come to take it very much for granted. I am therefore extremely pleased to hear that the Secretary of State is setting up an inquiry because, without going over the issue at all and pre-judging it, there seems to have been something of a time lapse between the incident happening and consumers being warned that their water may well not be drinkable due to contamination by diesel.
The second small point with which I shall deal now is the question of the regulator. Towards the end of the Statement, the Minister announced the creation of the position of regulator. I presume that is rather similar to the Ofwat appointment that we made when we privatised water in England. To that extent, I welcome the Government's conversion to the importance of regulation. I believe that that indicates that they do not have a great deal of faith in democratic accountability by councillors, which is what they preached before the election. Indeed, it is the contrast between this Statement and what the Government were saying before the election which struck me most as I sat listening to the Minister.

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I remind your Lordships of some of the things that were said before the election by the party opposite. In 1995 the Scottish Labour Party's manifesto for the Scottish unitary party elections stated:
"The next Labour government will return water to directly elected control. Labour will not nominate people to serve on these new water boards unless plans are changed so that they are run by elected councillors".
In a speech that year to the Scottish Labour Party Conference at Inverness, George Robertson, the then shadow Secretary of State—I suspect well out of the way, probably in a tank with the hatches battened down in an exercise in some far off land at this very moment—said:
"I make this clear pledge to the Scottish people. On my first day in St. Andrew's House I will end this undemocratic farce. All the Water Quango Appointees—whoever they are—will be told to clear their desks, and I won't take no for an answer. Labour will then replace them with locally-elected councillors, chosen by their locally elected councils. Scotland's water will be back where it always should be—in local democratic control".
Just to show that it is not just history, earlier this year the 1997 Labour Party manifesto stated:
"We will return Scotland's water services to local democratic control".
Of course, we all remember that in 1994 the party opposite, egged on and helped by its friends in the Strathclyde region, conducted a referendum, at great public expense to those of us who are council taxpayers in Strathclyde, on whether the people approved of the three water authorities then being set up by the Conservative Government. The poll was fairly overwhelmingly against the then government's plans-97.2 per cent. against and 2.8 per cent. in favour. Now that there has been this great turnabout and the structure is to be kept, I wonder whether the Government will fund another referendum in Strathclyde so that we can all have an opportunity to see what people think about the new structure. It really is amazing. It is not long since the position of the party opposite in Scotland was that frankly nothing was more for the best in the best of all possible worlds than local government control of water. Certainly in comparison to all the horrors of privatisation, Scotland was in an enviable position—or was it?
Is the Minister really able to read out the words in the Statement with a straight face? First, he said, on the question of water purity,
"with the stark fact being that the purity of Scottish water is far down the UK league; indeed the three authorities are in the bottom five when comparisons are made across the UK"
—and I thought that the privatised water authorities in England were the absolute pits so far as the Labour Party was concerned. It would appear that they are a great deal better and have been a great deal better than the local authority-driven water authorities in Scotland. A chronic need for investment was referred to, especially in regard to sewage. Anybody who walks along some Scottish beaches will know that is the case.
Then came what I thought was the gem: the Minister managed to say with a straight face:
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"while the period of local authority control is looked back on as a period when the ownership of the industry was most generally acceptable, we have to accept that the infrastructure, often Victorian, was allowed to decay"—
and this under the control of the blessed local authorities! It is no wonder that we are doing an about-turn today and the Government are accepting that the water authority situation in Scotland set up by the previous government is the best way to deliver water services to the people of Scotland.
We go further. The Government are now saying that, thanks to the under-investment by local authorities in all the years they ran water, water consumers will to have to pay a great deal more in the years ahead. Let me be quite plain with the Minister: this investment is needed to bring the quality of our water up to the standards south of the Border. And south of the Border is where water is privatised, and it is supposed to be awful. So in fact the Government are accepting—and their English colleagues ought to be accepting also—that water privatisation has been a success. I wonder why they did not think about this in Scotland—after all, New Labour, new ideas.
Is the Minister now satisfied that, even returning it to semi-local authority control—or 16 out of 33, which seems to me a long way short of what they originally said they were going to do—this would actually precipitate the water authorities back into the position which he himself has said was totally unsatisfactory, with the infrastructure allowed to decay? I notice with interest that he has rejected any return to local authority control as such; and I think that is gratifying. However, will he now say that the Labour Party's position in 1994, when it instigated the referendum I mentioned earlier, was entirely wrong and that it was wrong to attack the proposals then being made by the previous government? That is in fact what this Statement is saying today. So they are either wrong now in keeping the three authorities or they were wrong then in opposing them. I must say that a number of my colleagues and ex-colleagues will be gratified today to have this ringing endorsement of the policy of having three water authorities.
Turning to the question of the appointments, I am interested to see that people with business experience have made a contribution to the boards. That was not what the party opposite said when the people of business experience were being appointed to the boards in 1994. But we will leave that to one side. Perhaps the Minister will tell me this. If people with business experience have a lot to contribute, why have two eminent Scottish businessmen like Ian Preston and John Robertson been removed from chairmanship of their two boards? Perhaps he will also tell us what are the business qualifications—I know they are councillors—of Mr. Robert Cairns and Mr. Colin Rennie that make them suitable to be chairman of these two very big industries on which all of us in Scotland depend. Perhaps he will explain that.
Coming lastly to the question of the Scottish parliament, I could not quite understand that. Is there just a suggestion here that the Scottish parliament may well take over control from the water authorities and in

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fact run Scotland on an all water authority basis? That possibility exists. Does it not in fact keep the very uncertainty that the Minister later in the Statement said he wanted to avoid?
The Minister freely admits in the Statement again—surprise, surprise—that private finance will be needed to improve Scottish water and sewerage. That is another welcome conversion. He might point out to one or two of his colleagues in the ministerial team that they ought to stop their antagonism to the private finance that built the Skye Road Bridge if they are actually going to embrace private finance when it comes to the water industry.
The final piece—and I think the Minister deserves a prize today—was to listen to him reading out with a straight face the words:
"We shall not play politics with Scottish water".
What was the Labour Party doing in 1994 with its referendum in Strathclyde? What was it doing at the Labour Party Conference? What was it doing in the manifesto? I welcome the Labour Party to its new realisation that indeed you cannot play politics with Scottish water. It is the Labour Party which has been playing politics with Scottish water, and we welcome its conversion to having three water authorities and its at least partial conversion to the fact that businessmen have a significant role to play in the delivery of water services in Scotland.
4.36 p.m.
The Earl of Mar and Kellie: My Lords, I thank the noble Lord, Lord Sewel, for repeating the Statement made in another place and I had better declare an interest in that I am not just an East of Scotland water customer. I also receive wayleave payments from that board.
The Scottish water industry may have been expecting a rather more vigorous shake-up than what is actually going to happen, but I suppose this has to be good for continuity. Ultimately the question must be about the ability to deliver services to the right quality, to the current standards and with appropriate efficiency and safeguards. The three authorities have a considerable duty to the 98 per cent. of Scots who receive water services and to the 95 per cent. who use the public sewers. The ability to invest in infrastructure is clearly critical. That opportunity to replace and develop infrastructure is limited by the ability to borrow. The Statement describes the limited borrowing opportunities which will be allowed. These seem to be less than the water charges paid by consumers would stand.
The noble Lord, Lord Sewel, outlined how local democratic control will be re-instituted. I am grateful for the assurance about continued public ownership. I welcome the opportunity for more elected local councillors to be on the three authorities, although they do remain quangos. I am glad that Labour councillors have now got over their squeamishness about sitting on quangos and I hope that the new members will be well acquainted with the needs of the water industry.
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On these Benches we would have preferred the option of three joint boards drawn from all the councils covered by the joint board areas and constituted proportionately. That way accountability for water and sewerage would be at the ballot box. The creation of a Scottish water regulator will bring together the supervisory powers of the Scottish Office and the Scottish Water and Sewerage Customer Council.
Clearly, the three monopolies—and after all that is what they have to be—need to be regulated. I welcome the promised creation of the three area consumer councils which are to champion the interests of local consumers. The measures intended to deal with the ongoing west of Scotland diesel and water problem are welcomed, and I wish Mr. Ronald Fraser well with his inquiries. Water is such a fundamental commodity that this is a most regrettable event. Clearly, this will be an incident for a regulator to deal with. Penultimately, the attention which will be given to the remoter rural areas is welcomed, particularly the possibility of rural grant aid. I am glad that that has been included in the considerations. Finally, I am glad to hear that the Scottish parliament will supervise the Scottish water industry and possibly reshape it as required in the near future.
4.40 p.m.
Lord Sewel: My Lords, the noble Lord, Lord Mackay of Ardbrecknish, has had his bit of fun. I do not begrudge him that at all. However, we have done what we said we would do. We said in the manifesto clearly and absolutely without any reservation that we would return Scotland's water authorities to local democratic control, and that is what we have done. I am afraid that the noble Lord still does not understand the basis and the whole emphasis that the Scottish parliament will have in the public life of Scotland. It is through the Scottish parliament and through accountability to a Scottish parliament that we have addressed the democratic deficit that was established by the previous administration in setting up water authorities which were completely lacking in any form of democratic accountability within Scotland. We have put that right and we have done it through the Scottish parliament. I hope that the noble Lord opposite will finally recognise the constructive role that the Scottish parliament can play in bringing about and enhancing democratic accountability in the institutions of government in Scotland.
As I said, we considered bringing the water authorities back under joint boards. If we had been in the situation that the noble Lord, Lord Mackay of Ardbrecknish, described prior to local government reorganisation, a strong case could have been made for that because we had a limited number of regional councils which had previously been water and sewerage authorities. The re-organisation of Scottish local government which created a plethora of smaller authorities made that option impossible because when you sat down and decided what the composition of those joint boards would be in order to recognise the population weight of the constituent authorities, you finished up with large and unmanageable boards. We did not think that that was a way forward in terms of

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good and effective management. The noble Lord, Lord Mackay of Ardbrecknish, sang long and loud the claims of privatised water. Do I take it that it is now his policy to advocate the privatisation of the Scottish water industry? I think we deserve clarification.
I turn to the points made by the noble Earl, Lord Mar and Kellie, on the composition of the authorities. I wish to stress that all those who applied for membership of the authorities, and indeed those who indicated a wish to serve as chairmen of the authorities, were subject to the full rigour of the Nolan procedures. There can be no claim that those people who are now serving on the water authorities do not deserve to be there and do not measure up to the task; they do, and I am sure that they will do a good job.
4.43 p.m.
Lord Monro of Langholm: My Lords, as the Minister responsible for the water section of a local government Bill, I remind the noble Lord that I spent hour after hour after hour in Committee listening to Members of his Front Bench—mainly George Robertson and Mr. McLeish—saying exactly what they were going to do the day after the election, and how they were going to return to the situation of 12 local authorities managing water. That is very different to the democratic method that the Minister is trying to promote in the proposals he has mentioned today. I congratulate the Minister on doing a complete U-turn with regard to what Members of his Front Bench said in the run-up to the election and during the Committee stage of the Bill.
Does he also agree that we were absolutely clear—I was clear about it throughout all stages of the Bill—that we were not privatising water in Scotland but we were providing the opportunity for investment in the water and sewerage industry which was absolutely essential? I am glad that what we proposed and what we carried out has proved to be so successful. I am glad that the present Government are following our lead.
Lord Sewel: My Lords, I accept that the noble Lord listened to what my colleagues in another place said about water at the time that the legislation was going through Parliament. However, more recently, I remember listening for many hours to Members of the Front Bench opposite speak on the evils of devolution. Things have changed on that side of the House too. The point we are trying to make is that the previous structure of the water industry in Scotland had a hole in it; there was a leak. That leak was the lack of democratic accountability within Scotland. We have addressed that matter. We looked at the options. We looked at the direct local government option of joint boards and we rejected that. It was unworkable because of the increase in the number of authorities brought about by re-organisation. It is absolutely clear that making the water authorities directly accountable to a Scottish parliament gives you that degree of democratic accountability and gives you an effective and real link of democratic accountability to a Scottish institution.
Lord Hogg of Cumbernauld: My Lords, I welcome today's Statement, and I am sure that it will be
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welcomed throughout Scotland. Whatever may be said about the Benches opposite, they cannot claim to represent Scotland in any way whatever. It is particularly welcome that we are to have an inquiry into what happened in north-west Glasgow in Milngavie and Bearsden. I represented Bearsden in another place in the early 1980s. What happened there is indicative of some serious flaw in the industry which may be related to the need for major capital investment. Can my noble friend tell the House what is the scale of capital investment that this industry requires in the short term to ensure that essential water supplies are maintained? What is the capital investment required in the long term? Is it not the case that whether the money is raised through taxation or from the private sector, at the end of the day the consumer will have to pay for that? The sooner the Government and the Opposition are prepared to say to the public that this will have to be paid for by them, the consumers, and there is no way round that, the sooner we will create the environment that will make water reorganisation far better understood.
I welcome the fact that the Scottish parliament will take responsibility in future for the structure and organisation of the water supply industry in Scotland. That has to be right. There can be no industry in the country which is more important to the public than the water supply industry. It is right that we should maximise democratic control over that industry while recognising, of course, that there is a clear place for private sector finance.
Lord Sewel: My Lords, I thank my noble friend for a characteristic and realistic assessment of the Statement. On a number of occasions I have made comments that have been reported in the Scottish press to the effect that we as water consumers face an increase in charges to ensure that our infrastructure is improved, not just maintained. I can give some indication of the scale of investment that is required. Up until the year 2000 it is envisaged that something like £1.5 billion of capital investment will be necessary to maintain the infrastructure and to meet the requirements of the EU directives. That gives some indication of the scale of the problem we face.
Lord Steel of Aikwood: My Lords, the fact that thousands of homes in the west of Scotland were deprived of a clean water supply was very serious and merits the appointment that the Minister has announced. Robert Fraser ran in the Borders a water authority for which we paid high charges but which was not allowed to decay as happened in some other areas. He is a very suitable person to conduct the inquiry.
Secondly, I wonder whether I might entice the Minister to say more about the prospect of the re-introduction of rural grants for water supplies. That would be very welcome were it to come into being.
As for the bulk of the Statement, I must say that the Secretary of State listed all the difficulties for every solution. When I look back to the rhetoric prior to the election on local democratic control—one point which the noble Lord, Lord Mackay of Ardbrecknish, managed to omit from his litany—it was Mr. George Robertson

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who promised that following the election there would be a "bonfire of the quangos". Instead, we see the creation of a few warm nests into which a few Labour councillors will be inserted. The gap between rhetoric and action is there for all to see.
Lord Sewel: My Lords, I do not know so much about the bonfire of the quangos, but I hesitate even to suggest the bonfire of the vanities. I thank the noble Lord for drawing our attention to the contribution and qualities of Mr. Fraser. I look forward, as I know my right honourable friend does, to the report. We will study it and act upon it, and act decisively if such a course is indicated.
I am afraid that I cannot say any more on the introduction of grants for rural areas. I shall want to see the outcome of advice and consultation.
Baroness Carnegy of Lour: My Lords, will the Minister tell the House simply and clearly why the addition of extra local government councillors is going to improve the management of this large industry, if important investment is thus kept to a minimum?
Lord Sewel: Yes, my Lords. The water industry is both an industry and a service. It must be responsive to the needs of the local population. One of the best ways of achieving that is through having the elected representatives of local communities on the water authorities themselves. We place very great emphasis on making sure that the authorities, as they are re-formed, are indeed responsive to their local communities.
Lord Monkswell:My Lords, in thanking my noble friend for repeating the Statement, perhaps I may chide him on the way in which he "let off" the noble Lord, Lord Mackay of Ardbrecknish, after his contribution. We all recognise that some of the problems of the Scottish water industry, as he pointed out, are due to lack of capital investment. It was the Front Benches opposite who presided over that lack of investment over the past 18 years. Local authorities may have been responsible; but it was central government who set the capital expenditure limit. I chide my noble friend for letting the noble Lord off too lightly.
What will be the position of the Scottish parliament? My understanding is that the UK Parliament will set up the office of the regulator for the Scottish water industry. Will the Scottish parliament, once it is set up, be able to change the legislative framework under which the water industry will operate and be able to reorganise the delivery of water services at more local level?
Finally, the Minister pointed out that if water authorities intend making any significant changes, they will be under a duty to consult with the local authorities. Will it be possible, through administrative means, for the water authorities to report annually to their local authorities on what has been going on—not merely on significant changes but on the conduct of their
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operations in the local area? That might bring about a closer connection between local democratically elected representatives and the operation of the water industry.
Lord Sewel: My Lords, I am nearly always happy to be chided by my noble friend. In this case I am utterly delighted. Perhaps I may make clear the point of the legislation. The role of the regulator will be established through legislation passing through this House and another place. However, once devolution is in place, water is a devolved area. It would be open to a Scottish parliament to pass whatever legislation it wished. We have indicated that we think it would be sensible for the parliament to stay its hand and see how what we are proposing settles down and how it works.
As to the relationships with local authorities, that is an area where we wish to encourage close participation and collaboration. I am happy to examine all means by which that can be furthered.
Lord Rowallan: My Lords, the Minister made great play of democratic accountability and a Scottish parliament. However, there is one problem. The Scottish parliament will not be in existence until 2000; the site for it has not yet even been chosen. Therefore there is a problem as to how democratic accountability can exist between now and then. The situation involving quangos will undoubtedly continue.
There is one small point that I wish to put to the Minister. Is he considering selling off the vast tracts of land that the water boards own, together with their sporting rights, which would raise a considerable amount of money to help pay for all the things that should have been done and have not been done? The disgusting state of most beaches along the west coast of Scotland is clear for anyone to see.
Lord Sewel: My Lords, it is nice to hear a concern for democratic accountability expressed from the Benches opposite. All I can say is, yes, it will most likely be the year 2000, or 1999, before a Scottish parliament is in place. But we are going down that road. We are going to get there. It will be real. We shall then have the proper relationship in place.
In relation to selling off land, it is not for me to tell the water authorities what to do with their assets. The property vests in them.

Crime and Disorder Bill [H.L.]
4.57 p.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Williams of Mostyn): My Lords, I beg to move that this Bill be now read a second time.
Crime and disorder cause fear and misery to individuals, families and communities across the country. We came into government pledged to relieve their distress with tough action against crime and against its causes. This Crime and Disorder Bill starts to deliver that promise.

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This is the second of two major Home Office Bills introduced in your Lordships' House in the current Session. Together with the Human Rights Bill, it will help to safeguard rights and reinforce responsibilities for all. I pay full tribute to the work done by Home Office officials and advisers and parliamentary counsel in the production of the legislation.
The Bill contains a substantial package of measures, taking forward 12 manifesto commitments. I shall set out its six main themes: first, nipping youth crime in the bud; secondly, combating anti-social behaviour and promoting local action against crime and disorder; thirdly, tackling racist crime; fourthly, expediting justice; fifthly, protecting the public from sexual, violent and drug-misusing offenders; and sixthly, providing greater consistency and clarity in sentencing.
To tackle youth crime, the Bill contains a number of measures from the White Paper, No More Excuses, which I presented to the House on 27th November. These include six manifesto commitments. Youth justice measures appear in each of the Bill's five parts; for your Lordships' convenience I shall take all the youth justice measures together.
Part I of the Bill includes a new parenting order under which parents of offending or disorderly children may be required to attend guidance sessions and to comply with requirements specified by the court.
Provisions in Part I will also protect children under 10 from turning to crime or anti-social behaviour. The child safety order will enable a court to make requirements to ensure a child's care and protection and prevent further disorderly or would-be criminal behaviour. Local authorities may apply to establish local child curfew schemes to prevent unsupervised young children being out late at night, putting themselves and others at risk.
Part II of the Bill abolishes the presumption that children aged at least 10 but under 14 are doli incapax. It was of course the judgment of the House of Lords which confirmed in March 1995 the doctrine's currency in English law but recommended that Parliament should review it since it could produce inconsistent results.
Part III of the Bill establishes in law for the first time that the principal aim of the youth justice system is to prevent offending by children and young people. It also requires local authorities to ensure that appropriate youth justice services are available in their area and to establish inter-agency youth offending teams. A new youth justice board for England and Wales will help Ministers to set standards and will monitor performance across the youth justice system.
Part III of the Bill also provides for mandatory time limits for juvenile criminal cases and includes other measures which will help us to halve the time between arrest and sentence for persistent young offenders.
Part IV of the Bill abolishes cautioning for young offenders in favour of a new police reprimand and warning scheme. Youngsters given a final warning will normally participate in a community intervention programme to tackle the causes of their offending. New
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community disposals—the reparation order and the action plan order—will encourage young offenders to face up to and make amends for the harm they have caused.
Part IV also establishes the detention and training order in place of the current sentences of detention in a young offender institution and the secure training order. The detention and training order will be served half in custody and half in the community with scope to shorten or extend the custodial element to encourage good progress. It will be available initially for 12 to 17 year-olds, with provision to extend it to 10 and 11 year-olds. Provisions in Part V of the Bill pave the way for implementing powers for courts to remand young people to local authority secure accommodation where this is necessary to protect the public.
The Bill's second theme takes forward manifesto commitments to protect communities from anti-social behaviour and to harness their efforts to tackle crime and disorder. As long ago as 1991 the Morgan Report recommended a key role for local authorities in crime prevention. The previous administration missed that opportunity—and every subsequent opportunity—to take advantage of the pivotal position of local authorities to bring together statutory and non-statutory agencies, and all local communities, to prevent and reduce crime.
To focus and enhance local efforts, Part I of the Bill places a joint responsibility on local authorities and the police to develop and implement local strategies to reduce crime and disorder. Strategies will be based on the results of local crime and disorder audits, conducted in consultation with local communities. Strategies will include objectives, and performance targets and will be published.
Local authorities will also, for the first time, be placed under a duty to consider the crime and disorder implications of all their policies. This will bring crime reduction considerations into the very heart of local decision-making.
Part I of the Bill also creates a new anti-social behaviour order which will prohibit behaviour which could cause harassment, alarm or distress. Breaching the terms of the order will be a criminal offence, with a maximum penalty for adults of up to five years' imprisonment. Anti-social behaviour orders will also be introduced in Scotland.
The third manifesto theme embodied in the Bill is protection against racist crime. These crimes are particularly odious, damaging, as they do, not just the victim but the very fabric of the multi-racial society in which we live. Part II of the Bill introduces new racially aggravated offences parallel to the main existing offences of violence and harassment under the Offences Against the Person Act 1861, the Public Order Act 1986 and the Protection from Harassment Act 1997. For each new offence, if the racial element is proved, significantly greater maximum penalties will be available. An offence will be held to be racially aggravated if either the offender demonstrates racial hostility towards the victim at or around the time of the offence, or the offence itself is motivated by racial hostility.

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Clause 68 makes clear that, in general, racial aggravation in connection with an offence is an aggravating factor, meriting a stiffer sentence. This confirms in statute the 1995 judgment in the case of R. v. Ribbans, Duggan and Ridley.
For Scotland, the Bill will provide for a new offence of racially aggravated harassment and require that a proved racist element in any crime should be taken into account by the court when sentencing.
The Bill's fourth major theme is improving the speed and efficiency of the criminal justice system. Part III contains provisions springing from the Review of Delay in the Criminal Justice System, the Narey Review, published by the previous government. These include measures to improve case management, to bring cases promptly to court, and to provide for cases which must be tried in the Crown Court to be sent there immediately.
To reinforce these improved arrangements, we will introduce time limits for the prosecution of all criminal cases under the Prosecution of Offences Act 1985. The Bill will enable more exacting time limits to be set for cases involving juveniles than for those involving adults and for even tougher time limits for cases involving persistent juvenile offenders. It will also provide tighter criteria for granting extensions to prosecution time limits.
The Bill will also provide that where a person is charged with an offence and the prosecution time limit is exceeded, rather than this resulting in the defendant's acquittal, the proceedings will be stayed. Such prosecutions could be re-activated in exceptional circumstances on the authority of a very senior designated prosecutor.
To enhance the ability of courts to manage business efficiently and expeditiously, Clause 40 provides for a number of powers to be exercised by single justices. It further provides that the Lord Chancellor may, following local consultation, authorise clerks to the justices in a particular area to exercise these powers. It is the Government's intention that, initially, on a pilot basis clerks should be authorised in some areas to exercise these powers.
The Government will also be bringing forward amendments at Committee stage to allow the delegation of some functions to lay staff in the Crown Prosecution Service. These would enable members of the CPS who were not lawyers to present guilty plea cases at the magistrates' court.
Under provisions in Part III, the police and courts will be allowed to impose more demanding conditions on bailed defendants to reduce delays caused by defendants' failure to appear in court.
Other provisions in Part III will enable remand prisoners to take part in pre-trial hearings by means of a live television link. This will save the time and expense involved in escorting remand prisoners to court, and reduce the risk of prisoners absconding under escort.
The fifth aspect of the Bill is protection against sexual, violent and drug-misusing offenders. Almost nothing so alarms and incenses communities as the
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threat posed by sex offenders, particularly those who would prey on children. Part I of the Bill provides for sex offender orders in England, Wales and Scotland. They will be extended to Northern Ireland under Clause 93. This order will forbid a known sex offender from specified conduct which poses a risk of serious harm. For example, a convicted paedophile might be barred from going near a school or playground. If an order is breached, a penalty of up to five years' imprisonment will be available. Orders will carry with them a requirement to be listed on the sex offenders register.
Part IV of the Bill provides for extended supervision after release for certain adult and juvenile violent and sex offenders. Under Clauses 46 and 47, convicted sex offenders will be liable to up to 10 years—and violent offenders up to five years—extended supervision after release. Released prisoners who break their licence conditions will be liable to recall by the Parole Board. Clauses 70 and 71 contain similar Scottish provisions for the extended supervision of sex and violent offenders.
A new drug treatment and testing order, as promised in the manifesto, will require the courts to take an active role in monitoring the progress of drug-misusing offenders who agree to undergo drug treatment as part of their sentence. The order will require regular drug testing. Failure to comply with the order's requirements will lead offenders back to court where they will face the possibility of imprisonment. Clauses 72 to 78 make similar provisions for Scotland.
The Bill's final theme is clarity and consistency in sentencing. Our current system benefits from judicial discretion to sentence in the light of all the circumstances of the individual case. The disadvantage of this approach is that sentencing can sometimes appear unpredictable and inconsistent. The Bill therefore places a duty on the Court of Appeal to consider producing sentencing guidelines for the main offences.
The noble and learned Lord, Lord Bingham of Cornhill, in his Police Foundation lecture earlier this year, acknowledged that providing guidance was an important function of the Court of Appeal Criminal Division. He noted our manifesto commitment and helpfully suggested that the Court of Appeal Criminal Division should rise to the challenge.
Court of Appeal guidelines will take account of the need for consistency and the need to secure public confidence in the criminal justice system. They will be informed by data on sentencing practice and on the relative effectiveness of different sentences in preventing re-offending. They will help sentencers to determine seriousness and to decide the weight to be given to an offender's previous offending history and response to previous sentences.
A new sentencing advisory panel will be appointed by the Lord Chancellor in consultation with the Home Secretary and the Lord Chief Justice. It will advise the Court of Appeal on sentencing, and may—at the request of the Home Secretary—suggest that the Court of Appeal produce guidelines for a given category of offence.

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Our manifesto promised that courts should explain at the point of sentence what the sentence would mean in practice. After consultation with the noble and learned Lord, Lord Bingham of Cornhill, it has been agreed that this will be best achieved through a practice direction to sentencers rather than by primary legislation.
Part V contains other miscellaneous provisions, most importantly new home detention curfews for short-term prisoners. These will be available for that group of prisoners serving sentences of more than three months and up to four years who at present are automatically released once they have served half their sentence. Under Clause 82, selected prisoners will be able to serve up to the last two months of the custodial part of their sentence at a specified address under a curfew enforced by electronic tagging rather than in prison. That should provide a safer, managed transition between custody and life in the community. Any breach of the curfew conditions could result in immediate recall to custody.
Part V also provides that offenders recalled to prison for breaching their licence conditions, or for offending before the end of their original sentence, will be subject to a further period of supervision following their second release.
This major Bill lays the foundations for the Government's long term assault on crime and its causes. It should equip the criminal justice system better to serve and to protect the public and should improve the quality of life for many people across the country. I commend the Bill to the House.
Moved, That the Bill be now read a second time.—(Lord Williams of Mostyn.)
5.13 p.m.
Lord Henley: My Lords, I start by offering thanks to the noble Lord, Lord Williams of Mostyn, for that clear and commendably brief introduction to a Bill that is 96 clauses in length. I imagine that we will require the noble Lord to speak at much greater length over the days in Committee, on Report and Third Reading as we seek explanations on those parts of the Bill into which we believe the Government should go in some detail. I am sure that the noble Lord will understand that when, in due course, he sees the large number of amendments coming from these Benches, the Cross-Benches and—dare I say it?—from behind him.
From these Benches perhaps I can give what might be termed a qualified welcome to the Bill. That does not mean that we welcome all parts of it, nor that we believe that the Bill cannot be improved in many places. But we accept that it is building on our recent developments under the previous Home Secretary, my right honourable friend Mr. Michael Howard. I refer particularly to the consultation paper that my right honourable friend published in March of this year, Preventing Children Offending, and the other report, Review of Delay in the Criminal Justice System, that we published in February of this year. We welcome the new Home Secretary's acceptance of so much of his predecessor's work—an acceptance that can be seen through the great similarities between his White Paper,
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No More Excuses—A New Approach To Tackling Youth Crime in England and Wales and our Green Paper. I do not at this stage wish to indulge in textual matters. But if noble Lords look at those two documents, certainly at the passages on the causes of youth crime and the key factors relating to criminality, remarkable similarities will be found.
I know that governments do not always welcome the wholehearted support of the Opposition. We saw a degree of embarrassment in the party opposite when it saw the support for the Government on some social security issues only last week. But I can assure the noble Lord that on this occasion we shall be taking a constructive approach to the Bill. We shall want to examine it in considerable detail and there is much that needs careful scrutiny in what is a long Bill. But we shall certainly offer support to those parts of the Bill that build on what we achieved over earlier years. We shall try to build on those parts that go so far, but could go further towards reducing crime, particularly youth crime.
We welcome the stress on youth crime. We believe that, despite the hype behind the launch of this Bill, the White Paper and the Statements in July and November, much more can be done. One thing that we can say about the Bill is: "Is that all?". It does not take us as far as the manifesto implied or, for that matter, what was implied again with the great deal of hype that I mentioned by the launch of the White Paper and the Bill itself. I suspect that we all want to see something more.
I wish to make one other opening remark and that is to offer my thanks not to the noble Lord, but to the business managers for securing a start in this House for such an important Bill. We know in all parts of the House that we shall experience enormous problems next year in getting through the vast legislative programme that has been set before us by this Government. The problems in this House next summer will be particularly severe when both devolution Bills finally emerge from another place—if they ever get there. We have now seen the Welsh Bill and we are waiting to see its counterpart for Scotland. I trust that the Government are not having any problems in the drafting of that Bill.
I say that in all seriousness as this Bill again has a considerable number of purely Scottish clauses. From these Benches my noble and learned friend Lord Mackay of Drumadoon may well have a word to say about those. Whether they will be affected by the Scottish Bill can only at present be a matter for conjecture. It is something that we would certainly wish to have resolved before the Bill goes to another place, just as we wish to see the Scottish devolution Bill before we make any further progress on the Human Rights Bill, which the Minister mentioned in his introduction.
I turn next to the Bill itself. We have a number of anxieties, most of which we wish to raise in detail at Committee stage and later. I am sure that the noble Lord will accept that. This afternoon I should like to concentrate on one or two specific points raised by the Bill.
I start by saying a little about the role of local authorities and their position in the fight against crime and disorder as dealt with by Part I of the Bill, Clauses

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1 to 17. Obviously I speak in relation to England and Wales and I dare say that my noble and learned friend Lord Mackay may have something to say about the Scottish clauses in this regard later on.
Under Clause 1 we see that the districts, or in London the boroughs, will have new powers to make anti-social behaviour orders. We want to know why the districts have been chosen and what their specific expertise is as opposed, for example, to the counties which have both a social services and educational background. I speak now of the two-tier rather than the single-tier authorities. In the case of most districts, I dare say they will have very little relevant experience, other than the experience that comes from being a housing authority, but even that experience is one increasingly diluted as many of them divest themselves of their housing role and contract out their housing concerns.
I suggest that the counties might have been more appropriate for this role because of their educational and social services background. Obviously, I accept that there are arguments to the contrary. For example, one could argue that the districts are nearer the ground; they have, as I said, that housing background. However, I would certainly be very interested to hear the reasoning behind that particular choice.
Under Clause 1 the districts are given that role. When we move to Clause 5, we see that the counties are to be involved in the crime and disorder strategies. In Clause 5 they are to act in co-operation with the police authorities, the health authorities, the probation committees and anyone else prescribed by the Secretary of State. Again, one has to ask who it is that the Secretary of State might prescribe as appropriate to act with the counties.
Clause 6, if I have it right, then brings the districts back in, formulating strategies and implementing them. It may be that I have simply misunderstood what is going on. It might be much simpler than I believe, but there appears to be a recipe here for confusion and bureaucratic muddle, with unnecessary duplication involving both the counties and the districts in producing these strategies. I would certainly welcome the guidance and elucidation of the noble and learned Lord the Solicitor-General on this matter, as well as a more general justification for involving the local authorities in what is undoubtedly a very new role, for which many might he insufficiently prepared.
There is one further point I should like to address in relation to the anti-social behaviour orders. We see at Clause 1(1)(a) a definition of what is anti-social behaviour. As I understand it, that is something possibly already covered by the Public Order Act as amended. Again, I would welcome the views of the noble and learned Lord. There have been some concerns expressed about that particular definition of anti-social behaviour. The noble and learned Lord will have seen a letter from the Howard League for Penal Reform in The Times today. We have to be very clear that such an order cannot be used simply to penalise the eccentric and should be limited to very real anti-social behaviour. Having said that, I welcome the concept of such an
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order, despite having some reservations concerning who seeks it—the local authority—as well as concerns about the definition.
In relation to the new duties being imposed on the local authorities, I must also ask something about cost. This will be dealt with in greater detail later on by my noble friend Baroness Anelay of St. Johns, but it appears at the moment that the proposals are to be cost free. I find this somewhat remarkable. The Government are proposing an immense bureaucratic structure crossing a range of agency boundaries and it seems strange that the Home Office believes that this can be done for nothing. That is certainly what the consultation paper said. There is also the danger that the Government are being over-prescriptive and that many local authorities which at present run perfectly successful local crime initiatives might find that they are forced to adopt things when they do not particularly wish to do so by the more mandatory approach being set out by the Government.
Moving on through parenting orders, which we promised in our own manifesto, and provisions which we broadly welcome, although they will require very careful scrutiny and might need tightening, I come to racially motivated offences and the provisions in the Bill from Clauses 22 to 26. I believe that we are all agreed in all parts of the House that this is an issue about which everyone is quite rightly concerned. Our position in this party is quite clear. Racism and incitement to racial hatred are wrong. We certainly legislated, as I believe the noble Lord made clear in his opening remarks, to deal with the problems of incitement to racial hatred. That was in the Public Order Act 1986. We made the publication of racially inflammatory material an arrestable offence in the Criminal Justice and Public Order Act 1994. That Act also created a new offence of intentional harassment, which allowed the courts and the police to deal adequately for the first time with that sort of behaviour.
This Bill proposes a new offence of racial harassment and a new crime of racially motivated violence. I accept that those are perfectly laudable aims. No one would dispute that. What I question is whether they are necessary in the Bill itself. I put it to the noble and learned Lord who will be winding up for the Government, am I not right in thinking that the courts already have sufficient power? Do we need to clutter up the statute book with extra and unnecessary words? The noble and learned Lord will be aware of the remarks of the former Lord Chief Justice, the late Lord Taylor of Gosforth. The noble Lord, Lord Williams of Mostyn, referred to them, but it may help if I quote exactly what he said:
"It cannot be too strongly emphasised by this court that where there is a racial element in an offence of violence, that is a gravely aggravating feature…it is perfectly possible for the court to deal with any offence of violence which has a proven racial element in it. in a way which makes clear that that aspect invests the offence with added gravity and therefore must be regarded as an aggravating feature". (Regina v. Ribbans, Duggan and Ridley, Court of Appeal, 15th November 1994).
That important point was confirmed by the current Attorney-General, the right honourable John Morris QC MP, when he stated that:

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"the Home Secretary has made proposals to introduce new offences of racial violence. In my professional experience, the Court of Appeal has long said that such matters should be taken into account by sentencing judges".—[Official Report, Commons, 6/11/97 col. 390.]
That is an acceptance by the Attorney-General that this is not necessary. I do not want to accuse the Government of gesturism, particularly as we in no way wish to send out the wrong messages from Parliament by seeking to strike out this particular clause, but I ask whether it was necessary to put these matters in the Bill, and I believe it is right to ask what precisely they add to the current position.
I move on from that to one admirably brief part of the Bill, the abolition of doll incapax. That is a mere two lines in Clause 27. Would that all clauses could be as brief as that. I have only one very small question. I quite agree that the time has come for this rule to go, and this is probably a suitable time for it to go. However, is it one that has been affecting many people over the years? Has it been used much in defence? Has it been cluttering up the courts unnecessarily by allowing that particular line to be pursued? I believe it would be worth receiving an answer on that particular point.
Turning to Part III of the Bill, dealing with the criminal justice system and the provisions setting out the principal aim of the youth justice system, I do not believe that now would be the time to explore in detail Clauses 28 to 45 or Part IV that comes after that, dealing with the offenders in Clauses 46 to 69. We will have time enough for all that detail in the New Year.
Although there is material here to be welcomed, there are also a number of concerns. There are new burdens on the local authorities and there are the omissions. For example, we still have no commitment to introduce a mandatory minimum sentence for third-time burglars, although I understand that the Home Secretary said in July of last year that this will be considered in the light of the resources and the prison service's capacity. I would certainly welcome any further thoughts that the noble and learned Lord might have on this when he comes to wind up, but I suspect we will have a further indication that the Government do not believe that taking tough action against house burglary is a top priority. Could they not now agree to implement our proposals, as they did as regards the other parts of the Crime (Sentences) Act?
Perhaps I may add a word or two here about electronic tagging. We welcome the conversion of the Government to the merits, on occasion, of using this facility. The noble Lord will remember how strongly the Opposition opposed its introduction on civil liberties grounds with the Criminal Justice Bill in 1990. But we are concerned that the Government's welcome conversion is motivated merely by a desire to reduce prison numbers. We believe that prisoners should serve their sentences and that tagging should be available as an extra sentencing option for the courts and not merely as a means of securing early release.
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We also have concerns about secure accommodation orders for young offenders. Again, I seem to remember the party opposite opposing such measures when we put them forward as merely leading to the creation of an academy of crime. Now I take it that the Government endorse them—certainly, in Clauses 80 and 81, that seems to be the case—and actually want to increase the risk of creating an academy of crime by increasing the age band of young offenders who would go in. I hope that I have misunderstood that. I would welcome an explanation from the noble Lord.
We have a number of concerns relating to the financial aspects of the Bill. I think that the Government have not properly set out just what the costs will be on the Government, on the police, on the probation service and on local authorities. My noble friend Lady Anelay will be dealing with that matter later on but I hope that the Government can reassure us as to just exactly what the costs will be. The Bill is necessarily rather vague.
There is much in the Bill that we welcome but it is clear that there is much that is merely presentational. There is much meat which we will invite the Committee to consider inserting to strengthen the Bill. As I said in my opening remarks about the Bill, "Is that all?" Just exactly what do Her Majesty's Government hope to achieve with this Bill? How will they hope to measure its success? What exactly are they promising will be the result of the Bill? Those are the big questions.
5.32 p.m.
Lord Rodgers of Quarry Bank: My Lords, the Bill before us today for Second Reading is what the Home Secretary has called his flagship Bill. We were told about it during the debate on the gracious Speech and on numerous occasions until its publication a fortnight ago. We on these Benches are pleased to see it in your Lordships' House, though, like the noble Lord, Lord Henley, we recognise that it may occupy a good deal of time. There is a good deal that we welcome in the Bill and those parts will have the support of these Benches. But there is much else that deserves the most careful scrutiny. We shall play our part in that.
Before turning to the Bill itself, and perhaps as an overture to my further remarks, I wish to draw attention to a fascinating story in the Guardian newspaper last Thursday and ask the noble and learned Lord, Lord Falconer, to comment on it during the course of his closing remarks. The story in the Guardian refers to an aspect of the Bill. I quote:
"The Lord Chancellor, Lord Irvine, and the Home Secretary, Jack Straw, are engaged in an increasingly acrimonious and personal battle over barristers' near-monopoly of the criminal courts. The tone has deteriorated to the point that the Home Secretary sent an angry letter to the Lord Chancellor pointing out that Mr Straw represented the elected government, a reminder that Lord Irvine owes his place in cabinet to Tony Blair's patronage. The feud has become so intense the Prime Minister has been called in to adjudicate".
Then, further on in what is really a long, rather enjoyable and entertaining story, the article says:
"Earlier this week, Mr Straw appeared to have come out on top but the Lord Chancellor has mounted a rearguard action and the issue remains deadlocked. Mr Straw had been hoping to announce the change next week, when the Crime and Disorder Bill is in the Commons"—

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the article has that wrong—
"for its second reading, but that has been put on hold. 'The ducks are not yet lined up', a government source sympathetic to Mr Straw said".
To coin and readapt a phrase. "some duck", if it is referring to the noble and learned Lord the Lord Chancellor. I think all Members of this House will be deeply concerned if another member of the Government is attacking someone who is dear to us all. However, on the point of substance, I hope the noble and learned Lord who is to reply will tell us who is now on top. Will he give us a report from the front on how the war is getting on? If we were led to believe that there would be an announcement today, we have not had it yet, and perhaps the noble and learned Lord, Lord Falconer, is not going to give it to us either.
As for the Bill, what it will certainly not do is solve all the country's problems of crime and disorder. At most, it will make a modest impact on them. I would gently advise the Minister—and through him, the Home Secretary, perhaps less gently—not to claim too much in advance. In four or five years' time the Bill will not be judged by its good intentions but on the results which have flowed from it.
The Home Secretary—this needs to be said—is not in the mould of his predecessor, whose prime concern always seemed to be to impress his party conference and the tabloid press. But his real knowledge of—I refer now to Mr. Straw—and genuine concern about lawlessness as it affects ordinary people on housing estates in his own constituency may lead him into well-meaning remedies that simply will not work. Aspects of the Bill in relation to parenting orders and child curfews may come into that category.
Perhaps I may say in passing to the noble Lord, Lord Williams of Mostyn, that I hope the time will come when Ministers do not refer, as he did, to a Bill in terms of 12 manifesto commitments. It is a job of a government to introduce legislation which is justified on its merits. We all know or should recognise that many manifesto commitments are more foolish than wise. I am not suggesting that the Bill does not have merits—on the contrary—but to refer to it by reference to manifesto commitments is to get off on the wrong foot.
In the debate on the Address on 19th May I drew attention to the number of men and women then in prison. I said that 60,431 was an outrageous figure and that the Home Secretary should aim to get it below 50,000 by the end of this Parliament. But the prison population last Friday was 63,856 and, according to figures given to me by the noble Lord, Lord Williams of Mostyn, it is expected to rise to 71,800 by September 1999, with the average during 2001-2002 projected as 74,800. The alternative scenarios, as the Minister frankly admits, could put that figure very much higher. So instead of a prison population falling to 50,000 through the Government's first term, which might always be the last—who knows?—it is set to rise by at least 15,000.
This is a serious prognosis and many of the welcome provisions in the Bill seem trifling beside it. Prison takes men and women off the streets and to that extent, during
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that period, reduces the level of offending. But it does so at a high cost to the taxpayer and diverts money away from crime prevention. Above all, as prisons become more and more overcrowded and education and rehabilitation are neglected, prison turns first-time inmates into hardened criminals.
The position of women in prison is particularly disturbing at the present time. Numbers have doubled in the past four years. Many have a drugs or alcohol problem, but only 7 per cent. receive any help while in prison. There are no programmes to break the cycle of deprivation that brings them there. So far as I am aware, there is no constructive thinking on the Government's part to deal with this problem. I hope that the Minister will recognise that we are bound to judge the Bill in the wider context of penal policy as a whole.
The Minister did not do so, so perhaps we should remind ourselves of the injunction first heard from the lips of the Prime Minister, then the Shadow Home Secretary, almost five years ago. He said, in a resonant phrase, that we should, "be tough on crime and the causes of crime". In illustration he referred to poor education, bad housing, lack of employment and broken families living in sub-standard conditions. He spoke of the social fabric being ripped apart and deplored the growth of inequality. There was much in that speech, and in similar speeches, with which I agree. They struck a sympathetic note. But I wish that I was more confident now that the causes of crime still loom large in the Government's programme. No doubt the Prime Minister would say that welfare-to-work is about reducing unemployment, which is about reducing crime, but I doubt whether even he would dare to claim that cutting benefits means cutting crime.
We now have a Social Exclusion Unit in the Cabinet Office, which is fine as far as it goes. But yet another Whitehall think-tank is no substitute for properly funded policies to meet the huge shortfall in social housing, to redeem dilapidated sink estates and to transform our inner cities. If the rich get richer and the poor get poorer through the next five years, there will be more crime on our streets and more disorder, despite the provisions of this Bill. If we are not prepared to pay to end poverty and mend the fabric of society, we shall do nothing to reduce the causes of crime.
In the debate on the Address, to which I have already referred, I also said that there was one expression in the gracious Speech which gave me pause, which was, "measures against anti-social behaviour". I found "anti-social behaviour" a dangerous catch-all description and not one that I readily associated with the spirit and language of a free society, and I am not reassured by the text of the Bill.
As the noble Lord, Lord Henley, mentioned, Clause 1 deals with anti-social behaviour orders and seeks, in the following terms, to define what it calls, "an anti-social manner". That is,
"a manner that caused or was likely to cause harassment, alarm or distress to two or more persons not of the same household as himself".

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As the Bill shows, behaviour of that kind can lead to an order made by a magistrate, on the application of a local authority or a chief police officer, prohibiting the defendant,
"from doing anything described in that order".
Then, if the defendant continues to misbehave he can be imprisoned for up to six months on summary conviction and up to five years on indictment.
Let there be no doubt about it. We all know of the distress and misery caused to neighbours and others by thuggish behaviour, constant abuse, including racial abuse, and, for example, all-night parties, with the most vulnerable becoming victims. If local authorities and the police need more powers to deal with such cases and to deal with them quickly, the provisions of the Bill are very welcome.
But where are the limits? The behaviour of minorities, especially immigrants, is often claimed to be anti-social when it is in an hostile environment. Older people can find the high spirits and irreverence of the young intimidating. Working-class children straying into a nice neighbourhood can upset some householders by their presence and language. I would not trust every policeman fairly to invoke the provisions of Clause 1 if a manner "likely to cause harassment" is initially his to judge.
We must be careful that we are not introducing into statute wide powers which can be used against anyone who does not conform to a standard pattern of respectable behaviour or a lifestyle which is acceptable. I hope that it is not a device to take beggars and squeegee merchants off the streets, if that is still the Home Secretary's intention. Until the Bill is debated in Committee, I shall remain concerned about the disturbingly authoritarian overtones of "anti-social behaviour". We on these Benches shall certainly want to explore the safeguards against any interpretation that goes beyond the carefully considered circumstances that I am sure Ministers have in mind.
Having referred at some length to Clause 1, the House will be relieved to learn that I do not intend to go through the Bill clause by clause, although, like the noble Lord, Lord Henley, I am grateful to the Minister for so carefully taking us through it.
I wish to refer quickly to one or two other clauses in passing. I have already mentioned Clause 8 about parenting orders and Clauses 14 to 15 about child curfews. I would only add that we are doubtful about how effective compulsory court orders will be in respect of the former and believe that there are problems of enforcement as regards the latter—that is to say, child curfew.
We shall certainly need to be persuaded about Clause 27 and 10 year-olds being held to be as fully criminally responsible as adults. There are also serious objections to Clauses 80 and 81, which appear to turn their backs on the widely held view that sending juvenile defendants to penal establishments should end. As noble Lords will know, so often that is a step towards turning them into
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adult criminals or making them the victims of bullying and intimidation, with suicide seen to be the only way out.
Throughout our scrutiny of these clauses and others, we shall cast doubt on the wisdom of all those provisions that threaten to send more people to prison when there are acceptable alternatives available. I hope that that will be the approach of Ministers, given the figures I referred to earlier. We shall also ask where the resources are to be found for many of the proposals that we support; for example, the crime and disorder strategies described in Clause 5 and subsequent clauses.
In so far as this Bill seeks to get to grips with real problems, sometimes in an innovative way, we shall support it from these Benches, but where it proves to be ill-thought through and cosmetic, we shall be among its sharpest critics.
5.47 p.m.
The Lord Bishop of Leicester: My Lords, I believe that many people in the Church of England will generally welcome this Bill, and, perhaps more than most people, we are affected by it. As noble Lords are well aware, it is a tradition of the Church of England, through its parochial system, to maintain a presence in all parts of our land. For that reason, unlike other professional people, our clergy live where they work. With their families and congregations they share the life of their parishioners. We have, then, first-hand knowledge of life—yes, in the comfortable areas such as the suburbs, commuting villages and the country towns—but also we are very well aware of the pressures on those who live in the uncomfortable areas such as the deep, rural villages, the inner cities and the outer housing estates. It is on those outer housing estates that life can be made an utter misery through the activities of thoughtless, heartless or criminally-minded people and their children.
I was interested to see that a recent issue of Which? magazine devoted several pages to how to deal with problem neighbours. It took its middle-class readers through the problems of noise, building extensions, stray dogs, wayward children, troublesome trees, boundary disputes, unsightly gardens, parking difficulties and privacy. All of these can be, of course, a great nuisance. I, and other readers of the magazine, are now much better equipped to deal with them.
But the problems faced by many people on housing estates are of a quite different order. They can turn perfectly ordinary and respectable people into nervous wrecks as they encounter threats and violence from belligerent adults. It is often the youngsters, sometimes out of the control of their parents and bringing themselves up on the streets in peer groups, who cause the most intimidation. So, I for one am pleased that the Bill gives such close attention to the issue of youth crime and vandalism. Of course, we must take care not to over-react to problems that are caused simply by over-exuberant and naughty children. Nobody wants to subdue the energy and creativity of youth which can sometimes get them into trouble. The cut-backs in recent years in youth service funding and other family-oriented

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projects have not helped. However, the Bill tackles the hard core of nastiness and crime, which is of a quite different order altogether.
I am fortunate to live in a city, one-quarter of the inhabitants of which are of Asian origin. They believe in the old-fashioned virtues of family life, hard work, and law and order, but even in our city we have pockets where life can be made very hard by anti-social people, young and old alike.
This is an enormous Bill and I should like to focus on just two clauses, Clauses 1 and 5. My friend the right reverend Prelate the Bishop of Hereford will refer to other clauses later. Clause 1 focuses on dealing with anti-social behaviour through the use of court orders. I should like us to start one stage further back, however. In our experience, the most productive way to bring social harmony is to work with the people themselves.
Just because they live there, clergy in several cities around the country have involved themselves in lessening social conflict by helping to set up mediation and conciliation services. Local residents, after a period of training, act as mediators. They sit down with willing neighbours and help them to solve their disputes or the disputes caused by their children. Of course, neighbours are not always willing to involve themselves in mediation but, where it is possible, it is far cheaper in time, money and aggravation than involving the police or the housing authorities. Such a service, set up on one estate in Leicester, has been such a success that it is now on offer throughout the city. I believe that we should not totally lose sight of the co-operation principle demonstrated in such mediation services even when social disputes or disorder have gone past the point where they can he solved by friendly neighbours.
That principle of mutual co-operation shows up in embryo in Clause 5, which is at the heart of the Bill, where a duty is put upon local authorities and the police to formulate (in partnership with multi-agency teams) local strategies to tackle crime and disorder. That is vital because no one agency has all the resources necessary.
Perhaps I may give your Lordships an example. One estate in Leicester is more run down than most. It is the kind of estate that is unlikely to benefit from City Challenge or an SRB bid because it is difficult to get commercial partners interested. It was first brought to my attention by a young community worker who was simply at his wits' end. He came to see me, accompanied by his local vicar. He did not say a word. He simply started to put photographs down on my study table. They showed one road with one-third of its houses boarded up. I asked why, when there was such a shortage of housing. "People simply can't survive here", he said, "It's too tough". So, I began to visit the estate. In the past year I have visited its schools, churches, housing department, advice centre and the police. I have heard hard stories on each visit and I have been impressed by the determination and the dedication of the staff.
Perhaps I may give your Lordships a flavour of that. The head teacher of one of the primary schools told me that 18 months ago there was a little money left in the school budget at the end of the year and she spent it, to
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the pleasure of the children, on creating a garden—a green oasis in a dreary landscape. Every morning now on coming to school, she and some of her pupils replant the rose bushes which have been dug up and thrown around overnight by the local hooligans. "They will tire before we do", she said—and I hope that they do. People with that spirit will be those most helped by the provisions of this Bill.
Another visit that I made on that estate was to a family consisting of a young mum with two children and a Rastafarian husband. They told me in stark terms what life can be like if you stand up to some of the people in the neighbourhood. The man said, "I do it because I have two brothers who live just around the corner and we will have no nonsense but, mostly, people are too frightened".
However, changes are taking place there. The school, the police, the church, the housing department and a few of the residents, like our Rastafarian friends, are getting together. The police have agreed to establish a permanent presence. The housing department has set aside a house so that they can do so. The school, which has the trust and the confidence of the parents, is encouraging the parents to co-operate with the police in forming what would be called a "neighbourhood watch" in smarter areas of town. The clergy, as always. through their networks of care, are spreading the news that something better is being created.
That is a small example of the multi-agency teams which could emerge through the working of Clause 5, although I should like to see the necessity of involving voluntary agencies being given a clearer place in that clause or in the accompanying code of practice. Frankly, I do not think that it matters overmuch whether the police or the local authority is the lead player in such teams. What does matter is that the partners involve the statutory services, but they must also involve the voluntary agencies because they often have the confidence of the local people. It is absolutely vital that local residents are involved in any crime or disorder strategy for, without the involvement of the people themselves, such strategies are doomed to failure.
There is much to commend in the Bill. We look forward to engaging with its details in Committee. We in the Church would wish to be involved, as good partners, with others in helping to bring more peace and tranquillity to some of the most difficult parts of our land.
5.58 p.m.
Lord Watson of Invergowrie: My Lords, although almost a month has passed since I was introduced into your Lordships' House, I still feel that something of the surreal persists whenever I enter this Chamber. It is quite unlike the other place: altogether more solemn, richer in both history and characters and containing, I need hardly say, a breadth and depth of experience—indeed, expertise, as is shown by the speakers' list for this debate—with which the other place simply cannot compete.
It was a memorable experience when I was introduced, as Hansard quaintly described it,

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"between the Baroness Smith of Gilmorehill and the Baroness Ramsay of Cartvale".—[Official Report, 19/11/97; col. 5630.]
—and what a secure and comforting place it was to be, a place to which I would happily return at any time.
In passing, perhaps I may record my congratulations to the noble Baroness, Lady Ramsay, on her recent appointment as a Government Whip. I am relieved that not even her association with me could prevent her foot gaining a grip on the first rung of the governmental ladder. I look forward to working under her firm but fair direction in the months ahead.
It is customary at such times to pay tribute to the support which new Peers receive from your Lordships' House in its broadest sense. In doing so, I trust it will not be thought that I am merely observing tradition. I am genuinely grateful for the warm welcome which I have received and for the friendly faces which always appear, as if from nowhere, whenever I stop in a corridor wondering, often quite literally, which way to turn. There is no difficulty in finding an answer to the question of the moment; the trick, as ever, is knowing which questions to ask!
The debate in which I make my first contribution in this Chamber is one of considerable importance. A society should be judged by the extent to which its citizens are able to live peacefully, pursuing their own interests without interference from others. This country has its fair share of social problems, which has led to it having an unfair share of prisoners. Indeed, we have the unenviable record of having the highest prison population per capita in the European Union.
The numbers have reached a level that places an intolerable strain on the system. New prisons are to be built, but without complementary measures the problem will return in a few years. Emphasis needs to be placed on prevention rather than cure. That means grasping the nettle of youth crime firmly and decisively. Statistics show not just that crime committed by young people has increased dramatically in the past decade but, more worryingly, that seven out of 10 young offenders re-offend after their release from prison. That suggests that prison is not serving its intended purpose, and if future generations are to have a reasonable expectation of life in an ordered and orderly society, young people must become the main focus of law and order legislation.
For that reason I welcome the legislation introduced today by my noble friend Lord Williams of Mostyn. The Bill is understandably wide-ranging and in the time available to me I shall concentrate on three main areas.
In eight years as the Member of Parliament for Glasgow Central I came face to face with the many serious social ills associated with inner-city living. Crime was endemic. It is, I believe, well established that the poor are the first victims of crime. There were certainly many poor people among my constituents. The most graphic example of that concerned drug abuse and the drug culture. These days such problems are not, sadly, restricted to our cities but it is there that the most serious effects are felt.
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In 1995 there were 69 drug-related deaths in Glasgow. That figure fell to 55 in 1996, and I am relieved to learn that the present figure this year is 25a dramatic reduction. I hope that that trend can be sustained. I give credit to those people and agencies who put great effort and resources into fighting the scourge of drugs among young people.
Much of that reduction in fatalities has been due to the controversial methadone substitute programme which has been more successful than in other British cities. The range of services provided in Glasgow is among the most comprehensive anywhere in the world and is due to funding provided largely by the Scottish Office. That has had as its main benefit a 50 per cent. reduction in injecting drug users. I say in passing that there are 4,000 in the city, which is still a very large number. The police estimate that each injecting drug user commits the frightening number of 26 crimes each month to feed his or her habit. The consequent effect of crime in the city of Glasgow or anywhere else can be well illustrated by those figures.
It is for that reason that I regard the clauses relating to offenders dependent on drugs as being particularly welcome. However, I point out that drug treatment and testing will succeed only if accompanied by adequate resources to provide medical assistance and addiction counselling. I believe that the example of Glasgow underlines the need to underpin legislation with appropriate back-up services.
The Bill also deals with an evil that is now encountered with increasing regularity in this country: racism and racial attacks. Too often we in Britain take refuge in the apparently secure knowledge that racism is not a problem here. It is sad to say that that is simply not the case. I can speak of personal experiences in Glasgow, yet that city has a much smaller ethnic minority community than major cities in England, which consequently have greater problems. Earlier this year the New York-based group, Human Rights Watch, published a report which showed that Britain has one of the highest rates of racially motivated crime in Europe. As a result of that and other studies, there is absolutely no room for complacency.
I greatly welcome the inclusion in the Bill of clauses to allow judges to increase sentences to take account of a racist motive and I believe that it is long overdue. The new racially aggravated offences will in future attract higher sentences. In turn, that should have the effect of providing an incentive to police and prosecutors to search for a racial motive behind crimes in a manner that hitherto has been rare. I believe that racism is primarily the product of attitude, and attitudes take time to change. I am convinced that this measure will prove to be an important step in that process.
Finally, I should like to say something about anti-social behaviour. Of course, this can take many different forms, although the Bill defines it quite effectively. I disagree with the noble Lord. Lord Rodgers, who was dissatisfied with the definition. I believe that those who suffer anti-social behaviour do not need to have it defined; they know what it is and experience it daily. Legislation must be introduced

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which tackles it effectively to reduce its incidence. Times without number I was faced with constituents who suffered the abject misery of neighbours who not only gave little thought to the effect of their antics on others but went much further, actually intimidating or threatening, often gratuitously.
Housing authorities in Scotland I particularly single out the cities of Dundee and Glasgow—have made determined efforts to evict the culprits rather than rehouse the victims. The Law Society of Scotland—a body that I know and for which I have considerable respect—has questioned whether the introduction of anti-social behaviour orders under this Bill is necessary. I believe that it is. Existing legislation proved inadequate to deal with many of the cases brought to me, with evictions taking an inordinate amount of time to achieve. Often the threat of a breach of the peace charge proved to be little disincentive to people who possibly already had a string of such convictions to their name.
I believe that local authorities need additional means to remove offending families, with the interests of the law-abiding community being given prime consideration at all times. In conjunction with the crime reduction strategies which the Bill requires councils to prepare with police forces, I believe that there is a genuine chance to bring about a dramatic improvement in the quality of life for people unfortunate enough to be subjected to anti-social behaviour.
This Bill forms a major plank in the Government's first term programme, and rightly so. I am pleased that it has been prioritised in such a way. There are many areas in which the law is in need of overhaul, but I believe that none will have greater impact on the day-to-day lives of our citizens. Such is the scope of the Bill that few, if any, will remain untouched by its provisions, because we all benefit from measures that reduce crime and its effects.
I thank your Lordships for the courtesy shown me this afternoon and look forward to participating fully in the work of this House.
6.7 p.m.
Lord Ackner: My Lords, it is not only a privilege but a pleasure to rise immediately to congratulate the noble Lord, Lord Watson, on an admirable speech. It was vigorous, constructive and beautifully timed. The noble Lord brings to this House a wealth of experience in another place. He was a Parliamentary Commissioner for Administration between 1990 and 1995 and then a Member of the Public Accounts Committee. He demonstrates the breadth of his interests by being the author of a book entitled Rags to Riches. That is not an autobiography but the official history of Dundee United Football Club. We all know that it is very dear to his heart that a Scottish parliament should be established and succeed.
Clearly, a great deal of thought, research and imagination has gone into the preparation of this Bill. The Home Secretary is to be congratulated on emphasising preventive activity to reduce the incidence of crime and provide more options to deal with
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offenders, or potential offenders, within the community. My main concern is whether the resources will be available to make reality of an important crime prevention Bill. I give the example to which the noble Lord, Lord Watson, referred: drug treatment. Research in the United States shows that every dollar spent on drug treatment programmes saves the taxpayer seven dollars during the programme and a year afterwards. Most of the savings result from a reduction in crime, while the remainder is due largely to the reduced demand on hospital services. The sharp reductions in offending during treatment mean that treatment programmes can pay for themselves in immediate savings to the criminal justice system.
However, the availability of drug treatment and rehabilitation services varies across this country. Much of the funding for such services is insecure and this has discouraged the development of residential services and put some day programmes at risk of closure. Where drug misusers can gain access to treatment and rehabilitation services, there are often long waiting lists. If this provision is to work it must be tackled with adequate resources.
I agree with the criticisms which the noble Lord, Lord Rodgers of Quarry Bank, made in relation to the existing disastrous prison situation, but I feel some degree of sympathy for the Home Secretary. For the past three or four years the public have been misled into thinking that prison really works. They must be re-educated. That is not easy. I do not expect that the press are keen on so doing because it will not sell more papers, it will sell fewer. I have suggested that there should be a Royal Commission or the resuscitation of the Council on Penal Policy to look in depth at why we send more people to prison than any other country in Europe and at what is the sensible way of dealing with punishment. That suggestion has yet to be accepted.
If the public can be persuaded that what is proposed in the Bill will succeed the present harsh climate in regard to sentencing may be softened and funds can perhaps be redirected from the costly and counter-productive excessive use of imprisonment, resulting in this current acute overcrowding.
There are two matters to which I wish to pay particular attention. The first relates to Clause 27, which deals with doli incapax. In England and Wales the age of criminal responsibility is set at 10 years. In Scotland, it is as low as eight. That means that below the age of 10 a child may not be arrested or prosecuted for a suspected criminal offence. The presumption of doli incapax then applies up to the age of 14. That presumption obliges the prosecution to prove not only that a child under 14 committed the criminal act, but also that he knew that the act was seriously wrong as opposed to being merely a naughty or mischievous activity. To prove that, the prosecution must put before the court evidence beyond the facts of the offence itself. The maxim recently quoted by the noble Lord, Lord Mishcon, in this House, res ipsa loquitur, has no application. Such evidence could include an admission in an interview with the police that the child knew what he was doing was

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seriously wrong, or the testimony of a teacher or other adult concerning the child's mental capacity and appreciation.
Recently, we had a case in the Appellate Committee of which I was a member in which the point of the appeal was precisely the issue with which your Lordships are concerned. It was:
"Whether there continues to be a presumption that a child between the ages of 10 and 14 is doli incapax and, if so, whether that presumption can only be rebutted by clear positive evidence that he knew that his act was seriously wrong, such evidence not consisting merely in the evidence of the acts amounting to the offence itself".
The facts were very simple. At about 3 p.m. on 8th June 1992 two policemen on mobile patrol saw a motor cycle parked in a private driveway of a house in Liverpool. Two boys were tampering with the motor cycle. The appellant was holding the handlebars while the other boy tried with a crowbar to force open the chain and padlock securing the motor cycle. The police approached on foot and both boys ran off. One policeman chased the appellant who then climbed over a wall at the rear of the property and was arrested by another policeman. The damage to the motor cycle included the detaching of the leads to the coil and the battery and the dislodging of the mounting. There was no evidence of any admission or statement by the appellant.
At the conclusion of the prosecution's case, the appellant's solicitor called no evidence, but submitted that the prosecution had not adduced sufficient evidence to prove that the appellant, who was born on 29th June 1979 and was therefore just under 13 years-old at the time of the alleged offence, had guilty knowledge and knew that what he was doing was seriously wrong as opposed to being merely naughty or mischievous.
The magistrates found the case proved, relying essentially on the fact that the boy had run away and also on the boy's age. The Divisional Court, consisting of Mr. Justice Laws and Lord Justice Mann, took an entirely different approach. Mr. Justice Laws said:
"Whatever may have been the position in an earlier age, when there was no system of universal compulsory education and when, perhaps, children did not grow up as quickly as they do nowadays, this presumption at the present time is a serious disservice to our law. It means that a child over 10 who commits an act of obvious dishonesty, or even grave violence, is to be acquitted unless the prosecution specifically prove by discrete evidence that he understands the obliquity of what he is doing. It is unreal and contrary to common sense; and it is no surprise to find that modem judges"—
that is, Mr. Justice Forbes in a case in 1981 and Lord Justice Bingham, as he then was, in a case in 1992—
"have looked upon the rule with increasing unease and perhaps rank disapproval".
The judge went on to say that he would hold that the presumption relied on by the defendant is no longer part of the law of England and he therefore dismissed the appeal.
Members of the Appellate Court, when the case come to us, were taken through a whole mass of history and authorities. There were reports by committees and White Papers from 1927 to 1990. In the last paper in 1990, Parliament decided that it did not wish to make
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any change. However much we sympathised with Mr. Justice Laws, we therefore concluded that it would be usurping your Lordships' legislative function for us to have supported the decision made by the Divisional Court. We therefore allowed the appeal, answered the question affirmatively in both its aspects, but hoped that this House would look at the matter again, as it is now doing.
The only other matter to which I wish to draw attention is that of sentencing guidelines. When I came across the clause, it brought back a certain degree of nostalgia. The noble Earl, Lord Longford, may recall that in May 1990 he initiated a debate on sentencing levels. It was designed to attack the judges for handing out excessive sentences. The noble Earl was intent that he should not be robbed of the increased fun that occurs if you have a live judge present to be the subject matter of the criticism. So he sent a copy of his intended speech to the Lord Chancellor; the Lord Chancellor. as he hoped, sent it to the senior presiding judge of the Law Lords. It appears that matters involving volunteers are decided strictly on an alphabetical basis, and I was accordingly sent here.
In the course of my speech in relation to the proposal that there should be sentencing councils which would lay down guidelines to be followed by the courts, I said this:
"Over the years the Court of Appeal has laid down sentencing guidelines encompassing imprisonment in general-1 have already quoted one case—and offences in particular; namely, causing death by reckless driving, riot, violence at football matches, robbery, kidnapping, rape, unlawful sexual intercourse, buggery, gross indecency, living on the earnings of prostitutes, theft in breach of trust, benefits frauds, offences involving drugs and offences involving obscene publications. Very recently, in exercising the new powers … to increase inadequate sentences guidelines were … provided in the very difficult subject of incest".—[Official Report, 23/6/90; col. 990.]
I pointed out that those guidelines were all published, they were contained in the Judicial Studies Board Handbook, and in fact I caused a copy to be put in your Lordships' Library.
I went on to say:
"I have never heard any public criticism by criminologists, by police officers or by welfare authorities of those guidelines",—
and I observed that until there was any criticism of such guidelines I did not understand why they were not considered adequate.
It is not appreciated frequently enough that judges welcome and depend upon other people's views. When this debate took place I was then involved in the Appellate Committee with a case which had the distinction of being presided over by seven Law Lords instead of the usual five. We had the advantage of authorities from New Zealand, Canada, Australia and the United States, and learned articles from professors at home and abroad. I virtually ended my address by saying what I still say now: by all means let the judges have further and better assistance but do not interfere with their discretion.
6.23 p.m.
Baroness Flather: My Lords, I will confine my brief

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remarks to Clauses 22 to 25. I welcome the intention which is manifest in those clauses as three years ago I tried to do the same thing.
The most important thing is that we manage to achieve the end result for which these clauses are designed. That is the point that we shall have to test in Committee to ensure that we come to the right conclusion and stop this kind of behaviour, and make people realise that it is not acceptable to behave in this way in a civilised society.
It does no credit to this nation which prides itself on its fairness and its tolerance towards newcomers. Indeed, we are no longer newcomers—there are second and third generations—but, because we look different, we are still being treated as if we have another form to which we shall return. It is absolutely essential that public policy should reflect the displeasure with which society views that kind of behaviour. I congratulate the Home Secretary on attempting to put in this Bill the clear intent that this behaviour is not acceptable.
Three years ago, on a criminal justice Bill, I brought forward a much simpler amendment—and I see the noble and learned Lord, Lord Ackner, looking at me because, in the end, he supported me on that amendment. It was in two parts. One part simply provided that when racial motivation was proved in any crime before a court, then it should form an aggravating factor increasing the penalty automatically. The point was that instead of isolating different types of crimes for this particular purpose, we should have a blanket rule that any crime where racial motivation was proved in court would carry a higher penalty than other crimes.
The other part of that amendment, which was equally if not even more important, imposed a duty on the Crown Prosecution Service to disclose to the court any racial element—not motivation—that was contained in that particular crime. It has been experienced—and I hesitate to be precise because my information is anecdotal—that when there is plea bargaining and when a defendant pleads to a lesser charge, it is not necessarily the case that any hint of a racial element is put before the court. It is fudged over. I have had conversations with members of the Crown Prosecution Service and have been asked a very precise question: "Would you rather that the defendant got away or would you rather that that defendant was found guilty of a lesser offence?"
I have no hesitation in answering that question. It is for the court to decide whether or not a defendant is guilty. It is not for the Crown Prosecution Service to make a decision on its own. If it keeps fudging the racial element in various crimes, the courts will never become familiar—nor will the public—with the incidence of racial elements in different crimes, particularly in certain areas.
It is extremely important that the duty should be laid on the Crown Prosecution Service in all cases, whether or not there is a plea to a lesser offence, to put before the court any racial element in that crime so that that can be taken into account even when the defendant is pleading guilty. That has to be the way forward.
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I am concerned that there will be certain types of situations which these clauses will not cover. Indeed, the Commission for Racial Equality is concerned about certain things which it feels will not be covered, particularly the offence of racial criminal damage. We have not had this Bill very long; we have not had an opportunity of getting together as a group, as we usually do, to look at these clauses in detail and to get proper advice to see if there are any elements in these clauses which need to be strengthened or changed.
Therefore, at this stage I flag up the point that I hope that at the end of the day, what we get is what we deserve.
We have waited long enough for this. Sadly, I was not helped by the noble and learned Lord the Lord Chancellor in my attempts to get the amendment through because he was pursuing the path of a special offence of racial violence which did not meet with much support from noble Lords. This is an essential area of concern. One cannot say that a racial crime is worse than an old lady being bashed up or a child being beaten up and so on. I do not wish your Lordships' House to start making moral judgments about whether one crime is worse than another. But a civilised society must necessarily look very seriously at those issues. I am grateful to the Home Secretary for putting those clauses in the Bill so that they can be examined properly and all agencies which have had the opportunity to think about those issues can get together and produce the right answers.
Perhaps I may just touch on a few other issues. In the other clauses there are some very heavy points made about guidance, counselling, explanations and complicated issues which will have to be put across to families and to children. I make a plea on behalf of people from ethnic minority groups who may have linguistic difficulties and so on. Quite often the proper financial resources are not provided for those needs to be met. If such complex matters are to come into force, it is clearly essential that the needs of all must be looked at on an equal basis. Some people should not be left out because they have certain other difficulties.
I congratulate the noble Lord, Lord Watson of Invergowrie, on his maiden speech. He really did echo my feelings in relation to the question of living free from fear. There are citizens in our society who do not live free from fear. I know that that is not confined to members of ethnic minorities but a number of such people do live in constant fear of attack. I thank the noble Lord for making that point.
On a slightly different point, I should say that the United Kingdom need not wear a hair shirt as regards the number of racial attacks and the way things are going in this country. For three-and-a-half years I have been your Lordships' representative on the Advisory Commission on Racism and Xenophobia in the European Union. The only reason that we are put forward as an example of bad things is that we are the only country in the European Union which dares to keep any records. Therefore, we know how many racial attacks have taken place because they have been logged;

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no other country does so. Therefore, we are not here to wear a hair shirt in that regard. We are here to make things better.
6.34 p.m.
The Lord Bishop of Hereford: My Lords, first, I add my own thanks and congratulations to the noble Lord, Lord Watson, on his maiden speech. It was extremely wise and helpful and drew eloquently on his constituency experience.
Like other noble Lords, I should like to express a general welcome to many aspects of the Bill. No one can be unaware of the devastating effect of crime on families and communities and not least on young people. Serious and persistent anti-social behaviour can be almost as damaging, as many previous speakers have shown us already. I warmly support the intention of the Bill to make the prevention of crime a central pillar of the youth justice system. I should like to return to that issue in a few moments.
I turn now to those provisions of the Bill which seem most helpful and encouraging and I shall then draw your Lordships' attention to some areas of concern for the churches and voluntary organisations most closely involved in crime prevention and the welfare of young people.
We welcome and applaud the principle set out in Clause 5 of setting up multi-agency teams to tackle crime and disorder. The right reverend Prelate the Bishop of Leicester has spoken of that from his own first-hand experience. We welcome also Clauses 22 to 26 which deal with racially-aggravated, sexual, violent and drug-dependent offences.
Similarly, we are extremely grateful for the provisions in Clauses 52 to 55 in relation to reparation orders which fall in line with the principles of restorative justice, which is a refreshingly positive, creative and relatively new element of the criminal justice system. And so also the action plan order in Clause 56 is greatly to be welcomed.
I believe that the provisions of Clauses 82 to 84 to allow early release from custody by means of electronic monitoring, now that the technology is reasonably satisfactory and reliable, is a thoroughly sensible way to reduce what has been referred to already—our desperately excessive prison population.
Those are substantial areas of support and affirmation of what this Bill seeks to achieve. If I spend a little longer on concerns and caveats, that is only because I believe that this Bill could be so much better than it is and could do even more to draw on the expertise and enthusiasm of many people who have much valuable experience in the field of crime prevention.
I very much wonder whether there is not a considerable risk of abuse of the anti-social behaviour orders for anyone over the age of 10, not least the possibility, in the last resort, of imprisonment. I share the doubts expressed by NACRO over the proposed criminal penalty of up to five years imprisonment which seems excessive and perhaps also doubtful in principle in view of the likely difficulty of obtaining proof to the
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standard expected in a criminal case. If anti-social behaviour were to remain a civil offence, it could still lead to imprisonment of up to two years, and I believe it to be true that gaining a conviction would pose fewer difficulties.
I believe also that parenting orders are a doubtful method of coping with the problems which we face. By definition, they will come into effect, if they work at all, too late in the day to prevent young people being caught up in bad company and acquiring bad habits. They seem to be contrary to the spirit of partnership, which is at the heart of the Children Act. The threat of financial penalties on parents who are often already poor, inadequate and sometimes in despair is unlikely to achieve very much that is positive. Many of the parents involved will probably be single mothers. How will parenting orders be applied to absent fathers?
Clause 14 providing for a local curfew for children under the age of 10 adds nothing to the powers which are already available under the Children Act but are seldom used.
We have concerns about Clause 60, with its extension of the powers of courts to make detention and training orders for 12 year-olds and potentially for children even younger than that. As previous speakers have mentioned, there are very alarming provisions in Clauses 80 and 81—further sanctioning the locking up of children and withdrawing, by implication, the long-standing commitment to the removal of 15 and 16 year-olds from prison custody.
Those are detailed and specific reservations about what is proposed. But there is a fundamental underlying weakness of all this legislation: in practice it will be about containing the problem rather than preventing it, although the claim is made that the Bill is about prevention. It seems to ignore much excellent work which was done from 1983 onwards under the intermediate treatment programme through the voluntary sector. Sadly, that programme was granted only short-term funding and although it was remarkably successful and had an excellent track record, the tragedy is that countless good projects with families and young people run by, for example, the Children's Society, the NCH Action for Children, Save the Children and similar organisations have been curtailed or cancelled through lack of funds. Perhaps it is true that the inter-agency work and the action plans spelt out in this Bill will enable the work to be retrieved and expanded. I hope that is so, but it would be helpful if the noble Lord, Lord Williams, could give us assurances about that.
But behind these schemes, admirable though they are, and similar ones which I hope we shall see developing, remains the question: what actually works in terms of crime prevention? I am not sure that this Bill addresses that question. Fear of detection works, certainly; community policing works up to a point; zero tolerance perhaps with minor misdemeanours works, although that has seemed to run into trouble lately. Surveillance cameras work, although they tend simply to move the problem on somewhere else. But these measures, like the anti-social behaviour orders, serve only to contain the problem. They do not solve it or prevent it.

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I believe the provisions in the Bill overestimate the rationality of criminals and delinquents and the almost complete removal of inhibition by alcohol or drugs. What we need to emphasise above all are good parenting, which goes back to early childhood, strong, non-criminal role models of responsible behaviour and, even more important than anything else, a network of community relationships which provide powerful informal sanctions against crime and anti-social behaviour. These have to be in place even before the excellent mediation work referred to by the right reverend Prelate the Bishop of Leicester can be effective.
The enormous variations in the incidence of crime between, say, two housing estates, outwardly similar in character, with similar degrees of unemployment, poverty and other measurable social indicators, are also clear proof that what governs the amount of crime is mainly the nature of the community. This is true of communities in our own country now. It explains the fact that much greater degrees of poverty and deprivation in, for example, the 1930s produced much less crime, and that in infinitely poorer countries than ours there is often hardly any criminal or anti-social activity, simply because the community networks are strong and healthy. So if we are in the business of crime prevention we must be in the business of community building. This is something which the Church Urban Fund has been doing with great success for more than 10 years. It is of course infinitely more cost-effective than resort to the criminal justice system, even if the proposals in the Bill succeed in the long run in reducing slightly the enormous cost of that system.
Next, I emphasise the crucial role of women in crime prevention. Mothers have the first and, sadly, often the only responsibility for bringing up young children. In some of our least favoured areas—Meadowell on Tyneside or Grimethorpe in South Yorkshire, for example—women have taken an impressive lead in organising support and providing excellent opportunities for young people. They themselves need encouragement and some modest professional support, such as that offered by the brilliantly successful but desperately underfunded Home Start organisation. These women probably do not need parenting orders and punitive fines when things do not work out well. I believe such measures may simply drive them further into social exclusion.
The Bill offers much that is encouraging, with some new and imaginative and creative thinking, but I believe it could have built more strongly on established good practice, which cries out for more adequate funding and more active encouragement.
I end by painting two pictures which are vividly in my mind. About 10 years ago I had from time to time to visit a youth offenders institution at Portland. It was one of the saddest and bleakest things I have ever done in my ministry. There were young people from broken homes with broken lives, and despite the best efforts of some of the staff, the chaplains and the social workers, the prospects for those young people were grim. It was
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eloquent testimony to the desperately destructive effect of incarcerating young people. Do we really want more of that?
The second picture came about last Saturday, when I went to a community day in one of the areas of the city of Hereford which is, to put it mildly, not among the more affluent. It was a brilliant day, and the event was held in one of the junior schools. The schoolchildren had made an enormous scale model of their part of the city, with streets, model buildings and everything else set out. All sorts of organisations were there: the schools, the local authority, the churches, the volunteer bureaux and the disability organisations. There was lots going on. There was plenty of fun. The police were there, one police officer dressed as Father Christmas, and another policeman was saying "There are some pretty hot spots in this place". That exercise in community building did more, I believe, and will continue to do more to prevent crime than perhaps anything in this Bill, good though it may he.
6.46 p.m.
Lord Bingham of Cornhill: My Lords. I should like to join previous speakers in offering congratulations to the noble Lord, Lord Watson of Invergowrie, on his most interesting speech. I should also like to express my gratitude to the noble Lord, Lord Williams of Mostyn, for his lucid and comprehensive introduction of the six main themes of the Bill. I think these are themes which address acute contemporary concerns, to which the Bill offers imaginative and well designed solutions. The fair operation of these procedures will, I think, call for very great judgment and restraint on the part of those seeking, making and enforcing some of these orders, and also considerable precision in drafting the orders if they are to be enforceable. I am sure that all those who are concerned in administering justice will wish to see the broad objectives of these proposals achieved and will do all they can to promote their achievement.
May I say a word about two specific components of the Bill? The first concerns the sentencing clauses, Clauses 66 and 67. I am particularly grateful to the Home Secretary for consulting me in some detail on these clauses. As he knows, the final drafting is not 100 per cent. to my taste. I have reservations about the reference to cost in Clause 66(3)(c), not because cost is unimportant or irrelevant but because the courts must strive to find the right penalty even if it is expensive, rather than opting for the wrong penalty even though it is cheap.
I am, however, broadly content with these provisions. As the noble and learned Lord, Lord Ackner, has pointed out, the setting of sentencing guidelines is not a novel function to the Court of Appeal (Criminal Division) which over many years has been providing guidance to the lower courts. The only fault in the list given by the noble and learned Lord, Lord Ackner, of offences governed by guidelines is that it was a quotation from his speech in 1990, and many more offences are now the subject of such guidelines. Within the last few months burglary and manslaughter

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involving the use of knives have been the subject of such decisions, and firearms offences as recently as this morning.
Guidelines of course have on occasion been reconsidered and revised in the light of changing conditions and new maximum penalties enacted by Parliament. But these provisions will, I think, enable the Court of Appeal to perform its task with the benefit of expert advice from the sentencing advisory panel and, I very much hope, reliable independent research. With that assistance the proposals will, I hope, enable us to build on existing practice and give guidance with greater confidence and authority.
Secondly, I wish to say a few words about the proposal in Clause 40 of the Bill to allow certain powers of a magistrates' court to be exercised by a single justice of the peace or, subject to the making of rules, by a justices' clerk. I preface my observations by saying three things. First, I am an almost unqualified admirer of the magistracy, and particularly because of their numbers and their enormous contribution to our system of justice, the lay magistracy.
Secondly, I am a close friend and strong supporter of justices' clerks, the maintenance of whose role is, in my judgment, essential to the survival of the lay magistracy. Thirdly, I have no objection to the powers of magistrates' courts being exercised by a single lay justice. Indeed, when I say I have no objection I am being somewhat grudging. I fully realise the need for greater expedition in magistrates' courts. I am vividly aware of the adjournment culture which seems to have afflicted those courts in particular. I recognise the high desirability of a Bench, once assembled, being able to get on and try the case. I see good sense in allowing a single justice to exercise the powers of the court. But I regard it as vital that a clear and categorical distinction be preserved between the role of the justice as judicial decision maker and the role of the justices' clerk as objective, professional, legal adviser and, on occasion, administrator.
There are some powers listed in Clause 40(1) which can quite unobjectionably be exercised by a justices' clerk, for example,

"(b) to mark an information as withdrawn;

"(c) to dismiss an information…where no evidence is offered by the prosecution"

and, probably,

"(j) to extend, with the consent of the accused, a custody time limit".

These are formal, administrative acts; they are not judicial acts. But some powers listed in the clause are quite different, for example in (f) to require,
"a medical report and, for that purpose, to remand the accused in custody or on bail".
To send a defendant to prison is a judicial act; it is not an order which anyone not exercising judicial authority should make, and it is certainly not a matter of administration. There should be no power to make rules which would enable a justices' clerk to make such an order. The same, I suggest, is true of (e), to require,
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"a pre-sentence report following a plea of guilty and, for that purpose, to give the probation service an indication of the seriousness of the offence".
That is, if power were delegated and rules were made, the justices' clerk could tell the Probation Service whether custody or community service or probation was the likely outcome. That is not an appropriate function for anyone but the judicial decision maker and could be gravely embarrassing to the court. I take as my last example,
"(o) to give, vary or revoke orders for separate or joint trials in the case of two or more accused or two or more informations".
Those are significant discretionary decisions as to whether two or more offenders or two or more offences can be tried together. The making of such decisions is a regular ground of appeal in the higher courts, the complaint being that unjust decisions have been made. It is, again, not a decision for anyone not exercising judicial power. The terms of the subsection permit an order previously made, perhaps by a justice or justices, to be varied or revoked, if rules were made and this power were delegated, by the justices' clerk. That, I suggest is not acceptable.
I shall not weary your Lordships by examining all these provisions. I make it clear that I have no objection to the exercise of these powers by a single justice. But I object to the possibility that some of these powers might by rule be exercised by the justices' clerk because such a rule would erode the fundamental distinction between the justices and the justices' legal adviser and in the longer term—as I fear—signal the demise of the lay magistracy which would be an irreparable loss.
If the justices' clerk were to be entrusted with these important decisions and judgments, judicial in character, the time would inevitably come when people would reasonably ask whether he or she should not be left to get on and try the whole case. That is a result which might be welcome to some; I would not be among that number. Most of your Lordships would not, I think, be among that number either, and nor would most of those with knowledge of how justice is administered at a local level up and down the country. I am sorry that I appear to devote my time to a criticism of the Bill which in general I welcome but I feel concern about this power. I hope that the Government, valuing the magistracy as of course I am sure they do, will think again about this provision and remove what I believe to be a potential blemish.
6.57 p.m.
The Earl of Mar and Kellie: My Lords, I, too, congratulate the noble Lord, Lord Watson of Invergowrie, on his excellent maiden speech. We shared a radio programme on the day of his introduction at the unparliamentary hour of 7.45 a.m. for the benefit of "Radio Scotland" listeners. The noble Lord, Lord Watson, reminded the House that the Bill applies in Scotland and, I would add, despite being given the title of an English and Welsh Bill. I shall say more about that anon.
The Bill sets out to clarify many areas of the law in Scotland by introducing specific names for existing offences, both civil and criminal. Although the

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clarification is good presentation and raises public awareness, I wonder whether it introduces many new substantive points of law.
In Clause 18 the anti-social behaviour orders are clearly designed to deal with neighbours from Hell and, I hope, among others, off-road motor cyclists driving on legally asserted public footpaths. At present, if they dare, people can report such activities to the police, or to the procurator fiscal, as a breach of the peace at least, unless there has been a more specific offence committed. Perhaps what is new is that the anti-social behaviour order is more forward looking than the common law charge of a breach of the peace. As a civil law matter it attempts to control the future behaviour of the individual, whereas the prosecution of a breach of the peace looks back only and leaves the offender to draw his own conclusions if he wishes.
It is, of course, already possible to control future behaviour by seeking an interdict from the sheriff court. I see some merit in promoting this in a repackaged form. If it becomes popular—and by that I mean that people will come forward with sufficient evidence—the local authorities will have to set up a new section to deal with these orders. It falls to the local authorities alone in Scotland to promote these orders in the sheriff court, presumably having filtered them to reduce the volume and promote only the most serious.
It seems to me that there will be a need for local authorities to set up conciliation services to deal with less serious complaints and frustrations. These already exist in Scotland in the limited form of "diversion from prosecution" projects. SACRO. for example, runs two community mediation projects which act to resolve disputes between neighbours in conflict—I believe that is the polite term for neighbours from Hell—and three mediation and reparation schemes which accept referrals from the procurator fiscal. They act to achieve a mediated settlement between victims and accused, some of whom are neighbours in conflict. For those who must sort out the complaints, the distinction between a clash of lifestyles or personalities, and serious anti-social behaviour, will need to be clearly drawn.
I am not against these orders, but I do wonder whether local authorities are yet facing up to a task which is not a current responsibility and for which there are unknown costs, particularly in gathering evidence to the appropriate civil standard. In practice, distressed neighbours may still find it quicker to report their difficult neighbours to the police for a breach of the peace. The response time may be shorter than that of the local authority.
I turn to the proposed sex offender orders in Clause 19, which were, until very recently, trailed as community protection orders. Like the anti-social behaviour order, the sex offender order is a civil remedy, and is similarly forward-looking. It clarifies that it is possible to ban sex offenders from, for example, hanging around near children's playgrounds, schools or anywhere they may appear to pose a threat to potential victims. It will be applied for, following complaints, by the local authority and/or the police in the sheriff court in order to prevent specific activities by
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sex offenders, convicted or cautioned. Of course, that can already be done by application for an interdict: but that is a rather theoretical matter for most citizens. The local authority or the police will be able to act on receipt of sufficient evidence of the appropriate standard and promote the order. It is already possible to curtail specific behaviour within the conditions of a probation order.
There are two spin-offs which may not have been intended and which may not be permissible or even constitutional. The first is the appearance of the police in the civil court, promoting the order and using civil standards of proof. I wonder whether the procurator fiscal may have a role here. The second spin-off is the appearance of the procurator fiscal in the civil court for the prosecution of a breach of a sex offender order. While the order is a civil matter, the breach is a criminal matter. My final comments on these two orders have to be that they are both unsupervised orders: and it is not clear whether the subjects have to give their consent before the order is made.
Turning to Clause 72, the drug treatment and testing orders are a sharpening up of an existing remedy. The usual approach has been to place the offender on probation and make an additional condition of the order requiring him or her to undertake treatment at a named treatment centre. The proposed order improves on that remedy in the respect that the subject of the order is under far greater scrutiny, both by being tested on a regular basis and by having to appear in the dock in open court for monthly reviews. Those two additions will certainly test the sincerity of the offender in his desire to overcome the drug-taking habit. I am pleased to see that, when the offender is progressing well, the monthly review can be undertaken by the sheriff in chambers without the offender having to he present.
There will be a clear need for sufficient resources to be made available to fulfil the orders—in social work, health and housing provision. I am concerned that the level of supervision offered by the local authority will be minimal, and will be restricted by statute to the needs of reporting for monthly reviews, reporting any failure of compliance, and the need for variation or revocation of the order. Presumably the supervisor will be allowed to discuss other relevant issues but cannot insist on doing so.
Clause 70, dealing with the extension of post-release supervision of violent and sex offenders, is to be welcomed. The provision will of course be a further burden on Scottish local authorities, but then they are already tied into the post-conviction lives, certainly of sex offenders. The response of those offenders to the imposition of extended supervision will be important. There will be breach proceedings, and some will return to prison. It is important that they have post-release supervision in order seriously to resettle them into the community. Will their extended supervision extend beyond the period after they have been returned to prison?
I now turn to the proposed tackling of racial crime under the provisions in Clauses 26 and 79. To someone trying to talk up Scotland as a tolerant, multi-cultural

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society, these clauses present a challenge. I am pleased that the approach taken is that of adding a racial harassment or motivation dimension to a substantive charge. This "add on" approach is preferable to a racially specific charge. The court will decide the extent of the racial aggravation, on top of the evidence of the basic offence.
The Bill recognises as an offence—to make a slightly more light-hearted remark, but one apposite to the development of our constitution—calling someone, for example, "an English whatsit". It is quite right that that should be regarded as an offence. However, I note that the Bill does not recognise as an offence calling someone an "upper-class twit". Why is it that class discrimination always left out in these contexts?
Finally—and now I wish to "get quite heavy"—after reviewing a Bill which I seem to approve, I must come to the matters of which I disapprove. The Bill is, on the face of it, an English and Welsh criminal justice Bill. But it contains substantial alterations to the law of Scotland. Those changes have not been given much publicity in Scotland. There was a brief consultation period, but the legislation cannot be said to have been well trailed in Scotland. Why was this Bill not promoted as a criminal justice (Scotland) Bill? Should not the lesson of 11th September have been heeded? The principal beneficiary of devolution/home rule is the Scots law. Should not a moratorium on altering the law of Scotland have been implemented until the decisively chosen Scottish parliament is in place? In lighter vein, I ask: should that be seen as an aggravation? In even lighter vein: should the Government be made the subject of a "bad government order". Perhaps the remedy would be an "action plan order", requiring that a Scottish Select Committee of this House take evidence in Scotland. (That is a serious point.) That action would alert the people of Scotland to what was happening to the law of Scotland.
7.9 p.m.
Lord Hardy of Wath: My Lords, a number of noble Lords have almost damned the Bill by faint praise. My praise is almost unqualified. It is a matter on which this Government should be congratulated. They inherited serious problems. In many parts of the country dime, disorder and lawlessness had reached such proportions that the urgency with which this Government have approached the matter was certainly needed.
Crime has risen enormously, but the increase in unrecorded crime in parts of the country where crime has risen most sharply is astonishing. I was reminded of it only this morning because my wife told me that my gardener's shed had been broken into during the night. Fortunately, I was aware that gardeners' sheds in areas like mine have long been the target of burglars so there was nothing in it for the thief to take.
Twenty years ago in an area like mine I would unhesitatingly have gone to the police station to report the astonishing crime and it would have been taken seriously. Now the police are swamped and I would not
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dream of informing them of the offence. Many parts of the country are like this. The nature of our society has been disfigured.
I have to look no further than my local newspapers. Two weekly newspapers serve my area. Over the past few years the editorial content of those newspapers has been dominated by reports of crime. In last Friday's edition, an 85 year-old widow was burgled. She encountered the burglar, suffered an attack and had to he rushed into intensive care, where she died. An 81 year-old widow was burgled. She had £150 and it went. The police did not catch the burglar, but they had a whip-round in the police station so that the old lady did not lose the money.
A landlady was drenched in beer and five joyriders were arrested. It was found that they had committed a large number of crimes. Two young men were mugged. Vehicles were stolen, drugs were found in houses in an area which 25 years ago would never have encountered the drug problem. It exists now in large measure.
The scale of offences, lawlessness and horror is acute and has risen dramatically. On Sunday a friend of mine told me about her parents who live in a pleasant bungalow with a warden scheme. A gang of youths is desperately terrorising them night after night. When one of her neighbours was gravely ill in his bedroom a thief was in the living room taking the television set. That kind of thing is now common in areas like mine and I am glad that the Government have decided to tackle the matter.
I am also pleased that the Government have begun to recognise rather more profoundly than the previous government did that local authorities have a major role to play. The combination of joint work with local authorities and the police can be helpful. I entirely accept the point made by the right reverend Prelate the Bishop of Leicester that voluntary organisations should be brought into the mechanisms. I wish to make one suggestion: once the bodies are set up, they ought to be monitored and the results published. It would perhaps establish a competitive situation, because local authorities and police forces would not wish to be at the bottom of the league. They would seek to be successful.
We must have more resources for the youth service. A number of noble Lords made the point that public youth services have been operating on a shoestring for a long time. I referred to my area and no doubt I shall do so again in your Lordships' House. When I entered the House of Commons in 1970 there was no unemployment problem, certainly not for young men. There is now.
Reference was made to the Children's Society. One of the saddest experiences I had in my last years in the House of Commons was when the Children's Society brought to London some 14 and 15 year-old children from a difficult estate in my constituency. I had them in Westminster for a little while and it was a distressing experience. They were 14 and 15 year-old boys and girls, the kind whom the noble Lord, Lord Henley, might have met during his numerous visits to my area. They attended a good school; they were not particularly academic although they were not stupid. I made the

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point in an earlier debate that they were the kind of boys who would have worked in the colliery, the steelworks, the glassworks and the engineering works. Unfortunately, however, the glassworks have closed, the engineering works have closed, the collieries have closed. As the noble Lord, Lord Henley, will recall, the steelworks are about the most successful in Europe but they employ only about 10 to 15 per cent. of the people who were employed 30 or 40 years ago. Idle hands make mischief. What we need to do above all is to make sure that those hands are not idle.
The difficulty for those boys and girls whom I met is that they saw no economic prospects. They saw little in the way of challenge; they had little in the way of resources. So when they got fed up with watching television at home—which is not difficult—all they could do was to gather on street corners. The moment two or three young people gather together on a street corner, everyone over the age of 40—perhaps with increasing reason nowadays—starts wondering how to get them moved on because the group is perceived as a threat. The youth clubs should be opened.
More than that, we need to encourage people to give service to youth organisations. In my area we have a long-established Scout and Guide movement which helps hundreds of young people. What about the hundreds and hundreds more who are not involved at all, whose parents perhaps do not want them to be involved, do not care whether they are involved, or are fearful that if they are involved it might lead to costs which they can ill afford? We do not esteem the youth organisations adequately.
I hope that the former Minister will not take this as a personal criticism because it is directed at the Minister who preceded him in his role as a monitoring Minister for my area under the city grant scheme. We saw moved into the former vicarage in my parish in Wath-upon-Dearne the national headquarters of the Church "Lads" and Church Girls Brigade. I am sorry that the two right reverend Prelates are not present, because we saw that not necessarily large but important national organisation move to my area. The headquarters is one-and-a-quarter miles from the Dearne Valley Partnership headquarters which the noble Lord frequently visited.
I suggested to the Dearne Valley Partnership that it was wonderful to have brought a virtuous, meaningful and worthwhile organisation into our area but their people would not cross the road to visit it. I saw the noble Lord's predecessor and asked him to visit it, hoping that it would be a mark of approval of the establishment of the new headquarters. He visited it but he had it taken out of his official programme and the time he spent there was marked as a private visit, so it was not terribly useful. Fortunately, Her Majesty the Queen and the most reverend Primate the Archbishop of Canterbury have visited it since then.
I make the point to stress that we do not sufficiently esteem and encourage voluntary organisations. The public purse will not at this time allow the resources that are needed to fund the youth service and we should therefore seek more positively to encourage the voluntary sector.
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It is not an easy problem, but the Government must sent out signals that there must be an improvement in the standards of conduct virtually everywhere in Britain and certainly in the distressed and affected areas. They must say to people that conduct of the kind to which we have become accustomed over the past two decades is not tolerable.
All kinds of fiddly points will be made, and perhaps serious ones, in the further stages of the Bill, hut one hopes that this House will allow the Bill to go to the other place in such a condition as to make a contribution to establishing the degree of law and order that the country needs. It is no good people saying that we must not let our prisons become even fuller. The reason we have many people in prison in this country is that we have a lot of crime. Much of it is not even measured because people no longer feel confidence in the organisations which have a responsibility.
As a Government we must now see that the country is told clearly that irresponsible behaviour, terrorising behaviour and violent behaviour will merit the kind of response which might make a contribution to deterring its continuance.
7.20 p.m.
Lord Windlesham: My Lords, like other speakers I welcome the emphasis in the Bill on youth justice. Some of the proposals have attracted criticism and there are certainly a number of matters which will call for close scrutiny in Committee. Nevertheless, the broad thrust of this part of the Bill is timely. It was carefully worked out, both before the election and after the present Government came to power. Moreover, many of the key elements have been the subject of intensive, albeit hurried, consultation.
Since the 1980s, as a result of steeply rising crime rates and the consequent pressures on legislators to respond, we have experienced in this country a series of increasingly frequent enactments aimed at dealing with some part of the overall crime problem. In addressing those issues inside as well as outside Parliament, there has been a clear divisiveness between those who put their faith in more effective law enforcement and punishment and those who urge that the priority should be to strike at the roots of poverty and social deprivation which are so often associated with offending. Let us hope that this Bill represents a departure from the stereotypes of the past and marks the start of a new era.
If there can be any doubt now about the scale and destructiveness of offending by young people, let alone anti-social behaviour, it will be dispelled by the most cursory look at the statistics. What I am about to say will perhaps complement the vivid anecdotal experiences of the noble Lord, Lord Hardy.
Home Office research estimates that 26 per cent. of known offenders are under the age of 18 and that 3 per cent. of offenders—a very small proportion—commit 26 per cent. of youth crime. Most telling of all is the finding of the Audit Commission in a survey published last year that young people commit around 7 million offences each year. If that were not bad enough, national population projections indicate that

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unless effective action is taken, the worst is yet to come. Both for males and females in age groups 10 to 14 and 15 to 19 the numbers are on the increase and are forecast to reach a peak between the years 2001 and 2006. If the forecasters are correct, that will be followed by a sharp decline in youth population from the year 2006 with numbers stabilising by the 2020s. The unavoidable conclusion must be that the next two or three years are absolutely crucial.
If attitudes can be changed, with the police, the courts and the prisons working closely with the schools, social services, probation and other services to contain and, if possible, to reduce the scale of deviant behaviour, then there will be some hope for the future. But if the effort is not made and reliance is placed disproportionately on punishment, imprisonment and deterrence, there is a near certainty that things will get worse.
There is therefore a need, recognised in the White Paper and translated into the Bill, for a sense of urgency at local level to turn young people away from crime. I find Part III of the Bill encouraging reading. It adds an important component to the system of criminal justice. The purpose is plainly stated in Clause 28 which reads:
"It shall be the principal aim of the youth justice system to prevent offending by children and young persons".
In future, all persons or bodies carrying out functions in relation to youth justice will have a statutory duty,
"to have regard to that aim".
As far as I can tell, creation of a general duty is an innovation not to be found in other parts of the system of criminal justice. While it sounds desirable enough in principle, there may be difficulties in reconciling it with international treaty obligations on the rights of the child and there will be an awkward question to be faced as to whether or not it should extend to defence counsel in criminal proceedings. But they are good intentions and good intentions often have practical consequences which must then be faced and resolved in some way that is regarded as satisfactory to the legislature.
The crux of the proposals in Part III is that the new initiatives, as often stated in today's debate, will be local in character. Under Clause 31 each local authority—which, in Part III of the Bill and subject to correction, I take to mean in general county councils—will have a responsibility to draw up and implement an annual youth justice plan. It must also establish for its area one or more multi-agency youth offending teams. They will draw on the expertise of the police and the probation service, together with the education, health and social services.
At national level there is to be a non-departmental public body known as the Youth Justice Board for England and Wales. Its remit will be to monitor the working of the youth justice system and the provision of services, to advise the Secretary of State on the operation of the system and to help with the setting of national standards for youth justice, including the accommodation in which children and young persons are held in custody. The latter is likely to prove particularly important.
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The accountability of this non-departmental public body, it is suggested by some, should not be to the Home Office, as proposed in the Bill, but to the Department of Health which has a responsibility for child welfare services. I do not agree. The Home Office has many restrictive functions and, over time, the performance of those restrictive functions may influence the cast of mind of the officials. It is most important for the departmental culture of the Home Office that it has responsibility for some areas of more constructive, more positive policy to act as a humanising force over the department as a whole.
The vulnerability of Part III of the Bill lies not in the structural design, but in the lack of ring-fenced funding for the youth offending teams in carrying out the local plans. That point has been made in several speeches today. The necessary money, it seems, is expected to be found from the financial resources which are available year on year to the police, to the probation service, to the health authority and to the local authority for education and social services. As a consequence, youth justice will have to compete with many other claims on hard pressed existing public services. It is a familiar picture and, apart from its relatively weak negotiating position as a hybrid newcomer, the compartmentalisation of spending in the criminal justice system means that if effective savings are made in one area, for example, lower court or prosecution costs because of diversion programmes, they are not transferred.
Similarly, savings achieved in the hugely costly prison service as a result of dealing with offenders in ways that do not involve sending them to prison will not be transferred to the operational agencies. Coopers & Lybrand calculated in a recent study that each youth crime costs £2,300 and that, if prevented, half of that cost would be recovered. Therefore, there is a benefit coming in from more effective prevention and it would be desirable to see if there were some way of linking that to the increased expenditure rather than leaving these new services subject to the already capped public services in each county authority.
I wish to say a brief word about the importance of voluntary organisations in supplementing the work of the new statutory youth crime service. Organisations such as NACRO will be able to play an invaluable part in making the provisions of the Bill successful in practice. NACRO has had long experience in bringing agencies together at local level in order to plan and carry out strategies to implement legislation. The combination of paid staff and willing volunteers can enthuse overloaded and sometimes reluctant members of the criminal justice professions to see the potential opportunities offered by new policies and can provide the commitment to make them work.
Without pre-empting a later speaker who has closer connections than I with NACRO, I conclude by saying that it would be a tragedy if the present sharply reduced core funding for NACRO prevented it from making the contribution it could so well make towards the successful implementation of this Bill.
7.33 p.m.
Viscount Tenby: My Lords, perhaps I may say what a pleasure it is to speak on this important piece of legislation. I believe I am correct in saying that it is the first Bill which will be shepherded through this House by the Minister. I wish him well in his herculean task. I am confident that we can count on his courteous and sympathetic ear throughout all the stages of the Bill, especially since some of us may be voicing the fears and aspirations which he so ably presented when on the other side of the Chamber not so long ago. Ah, the warp and woof of politics.
This is an important Bill and, in contrast to some of its predecessors, it covers new and productive ground. It is big. I believe there are as many as seven new orders contained in it. That is more, one is tempted to observe, than on the chest of a musical comedy general. Each is designed to address specific problems. In any case, the continued increase in the crime industry, whatever statistics may say, is too serious a subject for flippancy and, dare one say, for party politics, too.
The Bill covers far too great an area for me to raise more than a limited number of points and, in any event, there have been far more persuasive and authoritative voices than mine to pinpoint the major issues. I intend to concentrate on three concerns.
The underlying theme of shortening the time between the commission of an offence and the sentence, particularly where juveniles are concerned, is to be warmly welcomed. The Bill contains many practical ways of achieving this desirable result. I should declare an interest as a magistrate only recently seconded to the supplementary list.
I applaud the proposal that single magistrates should be able to act on a whole range of court tasks, although I suspect there may be more reservations about granting this power also to magistrates' clerks. I have realised since writing this speech that there could not be a more distinguished reservation than the one already heard this evening. I am extremely grateful to the noble and learned Lord the Lord Chief Justice for so tellingly pinpointing the difference between the administrative tasks of justices' clerks and the legal implications involved. Clearly, care will have to be taken about the choice of magistrates who are to sit alone. They should probably be drawn from a specially prepared list of a Bench's chairmanship committee. As to justices' clerks officiating, if it comes to that, certainly great care should be taken as to the seniority and experience of any so chosen. Although the Bill does not say so, I assume that only justices' clerks themselves and not clerk assistants would be eligible. That point should be addressed when the appropriate order comes to be made.
I welcome very much the partnership envisaged between local authorities and the various appropriate agencies. Once again this is of particular importance where juveniles and their parents are concerned. If I may be permitted one passing thought on the subject of breaching a parenting order—the right reverend Prelate, the Bishop of Hereford, also touched on this point—it would be this. I believe that we would accept the justice of imposing a financial penalty on those parents—
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regrettably, there are many of them—who have no intention whatever of taking their responsibilities seriously. But what of the single parent mother with, say, three sons, possibly by three different and absent fathers, where the subject of the order is literally out of control and physically intimidating? It is not enough to categorise mothers in this predicament as being inadequate. That is almost certainly so. Equally, they will almost certainly be in fear of their sons, making compliance impossible. Almost certainly, too, they will be unable to pay any fine imposed as a result of their inability to control them.
In another part of the Bill I can see a possible conflict of interest arising where a bail condition might be that the accused makes contact with a legal adviser. As one who has suffered endless delays in court because legal help has not been sought in time, I welcome the thought behind the provision. However, advice of a breach of such provision can surely only be provided by the accused's legal adviser himself—hardly a propitious beginning to their relationship, one would think.
I now come to the reservations which I mentioned earlier. My first concern relates to the detention of young offenders. Clause 62(1) the Bill states:
"An offender shall serve the period of detention and training under a detention and training order in such secure accommodation as may be determined by the Secretary of State or by such other person as may be authorised by him for that purpose"
What exactly does "such other person" mean? Is it the appropriate court? Is it someone in the prison service acting on behalf of the Secretary of State? Is it a holding device so that at some unspecified time, perhaps when various administrative arrangements have been made, the Secretary of State can authorise the appropriate authority to pick from these options? I have to say that leaving questions like these hanging in the air indicates that the drafting of the Bill in some cases does not always equate with the wholly admirable and oft-repeated assertion in it of using—I quote at random—"ordinary language".
In subsection (7), we are told what "secure accommodation" may be. From the menu, I pick two choices; first, a secure training centre. Way back in 1994 it was announced that five such institutions would be built. I remember the noble Lord the Minister—I hope he will not object if I quote him—saying on this subject:
"The proposal … will not work"—[Official Report, 25/10/94; col. 459.]
He also, quite rightly in my view, pointed out that there would be no STC in Wales. So not only would parents have to make the long journey to eastern England, where most are due to be situated, but local probation contacts would be similarly inconvenienced. That was three years ago. And where are we now?
I believe that the first—Cookham Wood—is being taken into the service next April. But what of the others? Have any yet received planning permission, where such permission is necessary? Is it intended that girls should be included in the net, with all the attendant problems that that brings, a point with which I know my noble friend Lord Allen of Abbeydale, who regrettably cannot be here tonight, is much concerned? I am not trying to embarrass the Minister by these remarks, but even

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allowing for the interminable delays of bureaucracy and a change of government, I feel that some of these urgent matters could have been addressed and resolved in three years.
The second selection from the menu relates to secure local accommodation, one of the options available for committal for detention and also, under Clause 80, available as somewhere to which juveniles of 12 and over can be remanded. Most of us will applaud this long-overdue provision. But what is available? Is it sufficient? Can we be satisfied that, in a service which is in the hands of local authorities, a sufficiently high national standard is maintained? Have the Government plans for a national inspectorate, for example? After all, if such inspections are deemed appropriate for magistrates' courts and the prison service, why on earth not for local secure accommodation?
On the question of availability of places, we have been told that the final 10 of 170 additional places will become operational in August next year. But should we not be laying plans now for many more? After all, the provision in the Bill will enable courts to remand juveniles of 12 and over direct to such accommodation, together with vulnerable 15 and 16 year-olds. In practice, I suspect that places will be at a premium and that, as a result, 15 and 16 year-olds deemed to be "non-vulnerable", in this curious phrase, will continue to be remanded in custody; that is, prison. That is surely no longer acceptable in this day and age. Further, from a detention point of view, having visited both youth detention centres and secure local accommodation over the years, I am quite sure which of them makes the more positive contribution in weaning youngsters off crime. Will the Minister undertake to get his colleagues to look sympathetically and urgently at the need to make a substantial increase in the stock of appropriate secure local accommodation over the next few years and put in train plans to have a national standard of efficiency inside them?
Finally, I come to the question of resources. The implications in the Bill for local authority participation must imply the need for further funding, sooner rather than later, since it seems unlikely at a time of major reorganisation for local government that the finance for what in some instances will inevitably create the need for additional posts will be forthcoming under existing limits. In addition, the Bill specifically identifies a need for a further 600 places within the probation service. Where will such personnel come from? Will the depleted Armed Forces be raided, as the previous administration threatened to do? What qualifications will be required of them? The Minister may recall that some of us were less than enchanted by the previous government's attempt to dumb down the professional qualifications of the service, an attempt which, in fairness to them, they seemed to modify as the months passed. Can the Minister now tell us how matters stand in this respect?
I hope the Minister does not feel that I have been grudging in my admiration of the Bill merely because I have voiced certain reservations over parts of it. My defence is that they are very important parts to some
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of us. In many respects—very many respects—it is an exciting and innovative piece of legislation which ought in general to demand the respect and support of the House and the country. I wish it well on its journey through the upper House.
7.45 p.m.
The Earl of Longford: My Lords, it is always a pleasure to follow the noble Viscount on social matters, as regards which he speaks with so much first-hand knowledge. I had one memorable encounter with his grandfather, the famous Prime Minister, Mr. Lloyd George, as he then was. I had written a book on the Irish treaty, of which he was the prime British architect. I was taken to see him by a beautiful woman. He was always happy to meet beautiful women. He put up for a time with me asking him questions about Arthur Griffiths and Michael Collins. He listened with visible impatience and then he saw a way out. There was a bell on the wall. He got hold of the bell and tugged it and then a whole lot of dogs rushed in and overwhelmed us. That ended the interview. I realise that he was a man of genius but I prefer the social record of the noble Viscount who has just addressed us.
I was honoured and almost excited by the recollection of the noble and learned Lord, Lord Ackner, about a debate I initiated in 1990. I had been initiating debates in this House for 35 years before that. The noble and learned Lord brought a special quality to those debates and he has done the same ever since.
I realise that the most important things I intended to say have already been said by the noble Lord, Lord Rodgers, and the noble and learned Lord, Lord Ackner. Nevertheless, I shall briefly say them again. About 40 years ago, with a lot of expert help, I wrote a book on the causes of crime which I believe is still in the library. If noble Lords are interested in my views on the causes of crime and have a few minutes to spare they can look them up there. So I shall not go into the fundamental causes of crime. One must put the Bill into perspective as an attempt to curb the terrible fact of the increase in crime. It is doubtful whether it is increasing at the moment, but certainly since the war it has increased ten-fold. So it is obviously an important issue and an international issue.
What are we to make of the present attempt? In my few remarks I am scratching the surface of the subject and, if I may say to the Minister with enormous respect, so are the Government. The Bill is full of good intentions. Certainly, if I am called on to vote on the Second Reading of the Bill, which of course will not happen, even apart from party loyalty, I would have no difficulty in supporting it. However, it is a limited measure when one thinks of the problem of increasing crime.
What has happened in this country—it was alluded to by the noble Lord, Lord Rodgers, and the noble and learned Lord, Lord Ackner—is that in the past four years the prison population has increased by 50 per cent. It is going up and up. As the noble Lord, Lord Rodgers, said, it was 60,000 a few months ago and now it is nearly 64,000.

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Can anyone tell me why that is so? What is the explanation? It does not lie in the mouth of any official spokesman to say that it is due to an increase in crime, because official spokesmen of all parties say that crime has diminished. We were given rather thought-provoking figures by the noble Lord, Lord Windlesham. In passing, I cannot help but say yet again that his memorable books on penal treatment, written since the war, stand alone.
The figures are for crimes of all kinds. But if one considers indictable crimes, according to the figures given to me, the number has declined. It has declined from over 5 million to under 5 million. On the face of it, therefore, crime has decreased in the past four years yet the number in prison has increased by 50 per cent. That is the kind of fact which the brilliant government representative will no doubt manage to pass over quickly in his reply. But those are the facts. For no obvious reason the number of people in prison has increased enormously and with what result?
In practice it makes rehabilitation impossible. There is an enormous increase in expenditure. We have been told that 30 prisons are to be built in the next few years. People say that we cannot afford it and therefore the probation service is being cut. What about the education service? That is also being cut. Because of the insane policy of sending far more people to prison than we need to, we are lowering the standard of treatment in prison. Therefore, it is now impossible to give adequate, rehabilitative treatment to prisoners. What is more likely to create crime in future than sending a great many people to prison, lowering the standard of their treatment, and making sure that they are not treated properly?
Up to a point, for some months we have been able to blame the previous government, but not the long-term representative, the noble Lord, Lord Windlesham, and the other ex-Home Secretaries who are now in this House. Through their labours the prison population had been reduced to just over 40,000. But, suddenly, there was a sea change and for no obvious reason the prison population has gone up and up and it is doing that now.
Until the Government do something about that they are toying with the problem. I have written an article somewhere or other as though I were Jack Straw. I never had the chance of being Jack Straw. When a Labour Cabinet was formed in 1964 I became the Leader of the House. Evelyn Waugh wrote to a friend and said that he was glad that I was not going to be Home Secretary otherwise we would have all been murdered in our beds. So I am not going to say, "If only I had been Home Secretary I would have known how to deal with the problems".
The Home Secretary has a very difficult task. The question is what will happen when he comes before St. Peter? He will not arrive as soon as I do, but, nevertheless, the time will come when he will arrive there. I know that the Home Secretary is a good Christian. St. Peter will say to him, "What did you do down there? We have some brief up here about your prison population going up and up when you were Home Secretary. Did you do anything about it?" The
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Home Secretary will say, "I'm sorry, but I was very busy at the time". So I believe that St. Peter will relegate him to the same part of purgatory as I shall occupy. The Home Secretary has to face the moral problem of doing something about the situation or not.
What can he do about it? I believe that the noble and learned Lord, Lord Ackner, pointed us in the right direction. There was an atmosphere, which was not created by the judges. In the old days the judges were regarded as "the baddies" and the elected politicians would, somehow or other, improve matters. Now the judges are relatively "the goodies" compared with their political leaders. So it is not the top judges, but the people who pass the sentences. They are dishing out very heavy sentences not because of increasing crime but because of the atmosphere created by, I am sorry to say, the previous Home Secretary in a tragic phase of the Conservative Government. That is the situation.
I have said it before, but I cannot help saying it again. Is the present Home Secretary and the Cabinet ready to take on the responsibility of trying to re-educate the public about penal matters?
7.55 p.m.
Lord Dholakia: My Lords, no one can be in any doubt at all that tackling youth crime is a priority for the Government. Public perception, backed by the media, is that the problem is out of control. There is a continuous demand for tough action; more powers for the police and the courts; more punishment for parents and more teenagers behind bars.
The Government have responded with a variety of proposals, from boot camps to tagging; from naming and shaming to curfews. The Bill contains some positive measures, including early help for children and intensive community supervision schemes for those who repeatedly offend. Equally, there are many aspects of the Bill which appear to look tough rather than seriously address the problems.
I do not intend to be critical, but there are bound to be occasions when one has to be. But I hope that my kindness will be noted by the Minister because I have a request to make at the end of my contribution. I certainly welcome many of the measures outlined in the Bill. But let me declare an interest at this stage. I am vice-chairman of NACRO and in that capacity it is pleasing to note that that organisation has contributed in a positive way to some of the measures that we are seeing in relation to youth justice. In fact the Home Secretary's Task Force on Youth Justice is a body of which one of NACRO's senior staff is a member.
Perhaps I may declare another interest. I am also a member of the Police Complaints Authority. That organisation yesterday produced a report about the racist murder of Stephen Lawrence. The report was published by the Home Secretary yesterday. I therefore particularly welcome the provisions of the Bill which deal with racially motivated offences. They are contained in Clauses 22 to 25 and also in Clause 68. They rightly reflect the fact that racial motivation is an aggravating factor which it is proper to reflect in sentencing decisions and also in terms of maximum penalties.

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However, I have serious concerns about the ability of the criminal justice agencies to identify that particular motivation. In September of this year the Crown Prosecution Service produced a report on its Racial Incident Monitoring Scheme. It has succeeded in bringing admissible evidence of racial motivation to the courts' attention in about 84 per cent. of cases. But it comments that there still remains over 15 per cent. of cases where that is either not being done or the information is not being recorded. It comments also that when passing sentence the court has not necessarily reflected that by increasing the sentence or has been unwilling to state that it has done so.
What is even more worrying is the fact that the police identified only 37 per cent. of the cases submitted to the CPS, the remainder being identified by the CPS. What it shows is that the multi-agency strategy on which the previous and the present Government are placing considerable emphasis is not necessarily working well.
We need to examine not only the provisions in the Bill but the very definition of "racial attack". We must also accept that there is adversarial contact between police and the black community and ethnic minorities. Therefore, if this provision is to be effective, it is essential to back it up with proper training for police officers to enable them to recognise and properly record racial incidents; for the CPS to recognise racial motivation and to reflect that in its selection of charges and presentation of cases; and for sentencers to ensure that they consider racial motivation as an aggravating factor when deciding on sentence.
I say that because the British Crime Survey and a number of other research papers have identified the fact that racial incidents in this country vary in number from about 130,000 to as many as 250,000 a year. That is an unacceptable figure in any civilised society. Furthermore, a racial attack is not simply a phenomenon that occurs between two individuals. The psychological impact of what happens to the community is great, and that point has to be taken into account. Now that we have the opportunity as we assume the presidency of the European Union, we need to ensure that such incidents are highlighted when they occur in Germany and France. I hope that the Government will do that when they perform that particular role.
I welcome another feature of the Bill, Clause 5, which places requirements on local authorities and the police to draw up crime and disorder strategies in consultation with other agencies. In many ways this is the most crucial clause in the Bill because agencies working together to prevent crime can do more to protect the public than any number of changes in sentencing and penal policies.
Many of the Bill's provisions on youth justice should greatly improve the prospect of steering young people away from criminal activity. I welcome the establishment of a national youth justice board to set national standards for youth justice services; the setting up in every area of inter-agency youth offending teams to run diversion programmes, bail support schemes and community sentences for young offenders; a statutory
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duty on local authorities to provide a range of youth justice services; and measures to speed up the youth justice process. I am sure that all those working in the criminal justice system will welcome these measures which should greatly improve the consistency and effectiveness of the way in which young offenders are dealt with. I believe that NACRO has played a very important role in identifying the need for such measures.
I hope that the new reparation order will give the courts a useful low tariff penalty when dealing with young offenders. Experience with cautioned young offenders shows that apology and making reparation to their victims can have a salutary effect and that many victims appreciate it. The new action plan order of a short but intensive programme of work to tackle the causes of offending is also welcome. All those who have worked on supervision schemes will confirm that constructive supervision programmes offer the best hope of steering many young offenders away from crime.
There has been considerable publicity about those who reoffend when on bail. The provisions in Part HI of the Bill will help to speed up the youth justice system, thus reducing the risk that young people will dig themselves deeper and deeper into trouble by reoffending on bail. I hope that we shall not think that speedier justice means harsher justice. The sooner sentencing takes place, the sooner the constructive programmes of court-ordered supervision can start.
I believe that the new treatment and testing order for drug-dependent offenders can make a significant contribution to reducing both crime and imprisonment. Drug use now provides the motivation for an enormous amount of crime. Its use in penal institutions is even more worrying. The government-funded National Treatment Outcome Research Study recently found that a sample of 1,100 drug misusers entering treatment programmes had committed 70,000 crimes between them in the three months before starting treatment. That is a horrifying statistic. I am delighted that the noble and learned Lord, Lord Ackner, pointed out the research in America which has shown that every dollar spent on treatment programmes saves the taxpayer seven US dollars by reducing the cost of crime and the demands on the health service. That is a progressive way to tackle this matter.
Electronic tagging has aroused considerable controversy. With the prison population at an all-time high, Clauses 82 and 83 provide for the early release of selected prisoners under electronic tagging. This will provide much-needed relief for an overstretched prison system. How refreshing it would be (if we are to look seriously for a solution) to remove mentally ill prisoners from prison establishments and also reduce the use of remands in custody. I have served as a member of a board of visitors of a prison for over 15 years. There is a danger that lack of action on this front would cause control and discipline problems. The tighter pre-trial time limits will help to cut remand time. Let us hope that this measure will help to reduce the large prison population. I also welcome the statutory duty which Clauses 66 and 67 place on the Court of Appeal to issue sentencing guidelines with the advice of a Sentencing Advisory Panel. This is an important move towards

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fairer and more consistent sentencing which should help to reduce the excessive use which some courts make of prison for less serious offenders who would be better punished in the community.
NACRO has consistently pressed for extended periods of compulsory post-release supervision for sex offenders and violent offenders. I therefore welcome Clauses 46 and 47. Home Office research has shown that supervision on release markedly reduces the risk of re-offending. Supervision can include conditions (for example. requiring the offender to live in a specified place or to take part in a treatment programme) and failure to co-operate can result in recall to prison. Extended supervision periods will both increase public protection and may improve the prospects of the successful resettlement of serious offenders.
I have concerns about a minority of the Bill's provisions. Clauses 80 and 81 will further postpone ending the practice of holding 15 and 16 year-olds in the prison system. As recently as last month the Chief Inspector of Prisons published a hard-hitting report which argued for the removal of all young people under 18 from the "corrupting influence" of prison service custody. The previous government instituted a programme to build 170 more secure places for juveniles in order to end the need to remand them to the prison system, yet the Bill will change the law in order to use the places to lock up 12 to 14 year-olds instead. Earlier this year, during the passage of the previous government's Crime (Sentences) Act, Labour criticised the delay in ending remands of 15 and 16 year-olds to prison service custody. These clauses would extend the delay which the Government rightly criticised when in opposition.
Perhaps I may identify another area of concern. At any given time about 16 per cent. of the male prison population is black. The proportion is even higher in female establishments—at about 26 per cent., or one in four female prisoners, against a proportion of no more than 5 per cent. in the community as a whole. Why they are there is less important; what we need to find out is how the criminal justice system produced such a discrepancy. I have argued for a proper system of monitoring for the past 20 years. I accept that monitoring is the end product of a system where differential treatment has already taken place, but it is important to ensure that any measure that we promote has a proper monitoring system so that we can analyse the outcomes and ensure that the system treats everyone fairly.
I hope that NACRO will be able to play a full part in making the majority of the Bill's provisions a success. I welcome and applaud what the noble Lord, Lord Windlesham, said. The previous government cut NACRO's core grant from £1 million to £400,000. Unless those swingeing cuts can be reversed, NACRO will have to make extensive reductions in those core staff who are so crucial to developing services and strategies to prevent crime, resettle offenders and promote constructive changes to the criminal justice system. I hope and expect that the Government will look favourably on NACRO's application for the level of core funding that it needs. Raising money to work with
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offenders has never been an easy task. The Government's commitment to preserve the role of voluntary organisations in this crucial area of work requires financial help. NACRO is important to the Government. If it is not there the Government will have to invent it. The cutback in its resources will damage not only the organisation but the prospect of combating crime and disorder which this Bill embodies.
8.10 p.m.
Lord Northbourne: My Lords, I have been beaten by the two Statements and I apologise to the House for the fact that I must leave before the end of the summing up. I believe that the noble and learned Lord, Lord Falconer, has forgiven me, and I hope that the House will also forgive me.
I intend to speak only briefly on one particular issue. First. I congratulate the Government on this innovative and thoughtful Bill. I hope that its provisions work, and I shall do everything that I can to that end.
The right reverend Prelate the Bishop of Hereford said that the provisions of the Bill would not work unless they addressed the fundamental causes of crime at a much earlier age. He referred to the family. parenting and support for parents, which many noble Lords will know is a matter very close to my heart. The right reverend Prelate also referred to communities. I agree entirely with what he said in that context. He also referred to role models, and it is on that subject that I should like to speak for a few moments this afternoon. I speak about role models in the context of boys. Boys and men are responsible for the vast majority of crime. Girls are catching up a little but they are still way behind. I believe that it is useful to look at this issue in the context of boys.
It may well be that we underestimate the importance of role models. I refer the House to a very interesting and elegant piece of research carried out in Washington DC. I acknowledge that one swallow does not make a summer and that a piece of research done in one particular community in one country is not necessarily applicable elsewhere. However, one hopes that that can be replicated in this country in different communities. If it shows, as it clearly has in the United States, that for boys a role model is absolutely fundamental to their behaviour, to their acceptance of education and their being able to get on in school, then we have a lot of thinking to do. There is a great deal that we can do.
It was found in certain areas of Washington DC that African-American boys emerged from school almost totally uneducated having rejected education, while African-American girls did as well as any other racial group. When the matter was looked at more closely it was discovered that up to the age of six or seven boys and girls progressed pari passu. At about the age of seven boys peeled off and appeared to reject the teaching that they were being given by female teachers. It was hypothesised that the reason might be that those boys had come from single-parent families where they had no males in their lives and that they were being taught by women and were rejecting the guidance and education with which they were being provided. A

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group of African-American males—good guys—volunteered to go into a school for an hour or two each day. It was the same man in the same class each day. When little Johnny said, "I'm not effing doing that"—or whatever the equivalent is in America—the man would say, "Johnny, come here. You do what Mrs. Peacock tells you to do. I shall be here tomorrow and I shall want you to show me what you've done". It was as simple as that. Fascinatingly, those boys, now aged 15 and 16, are doing just as well as the girls.
I do not say that that can necessarily be replicated in another group in this country, but I ask the Minister to draw the attention of his right honourable friend to this work and the possibility of replicating it. It may be something that the Social Exclusion Unit can take on board. If the simple input of a male role model can be so important—it is not because women cannot teach boys but because boys look to men to see what it is like to be men, which is what they will do whether we like it or not—the implications may be enormous. We have to think much more about the role of men in families and the roles of grandfathers, uncles and aunts in the community. We must also think about the ratio of male to female teachers in schools and the youth service that has been almost destroyed over the past 20 years. We must also give consideration to sport and to training men to lead in these areas where they can be heroes and role models for boys. I believe that we must install a proper vetting system to ensure that the men we put into those positions do not damage the boys and, equally, that those men are not terrified of doing the job for fear of being accused of abusing the children.
I leave that thought with the House. This is perhaps one of the underlying causes of crime that we should address if we want the provisions of the Bill to succeed.
8.16 p.m.
Lord Mackay of Drumadoon: My Lords, I should like to begin my few remarks by joining in the congratulations of the noble Lord, Lord Watson of Invergowrie, on his eloquent maiden speech. I hope that the causes that he supports in your Lordships' House bring him greater rewards than his support of Dundee United football team in recent years. He comes from a constituency in Glasgow which has a lot of the problems with which this Bill is concerned. I am quite sure that at Committee stage he will speak with considerable authority on the issues to be debated then.
At this time of the evening I confine my remarks to a few observations on the provisions of the Bill as they relate to Scotland. I deal first with certain clauses which I welcome with a considerable degree of enthusiasm. I refer to the clauses that deal with drug treatment and testing orders. These clauses find a great welcome in Scotland from both SACRO and other quarters. This is a new and extremely worthwhile idea worth pursuing particularly as it is to be tested in a pilot scheme before full implementation occurs. Those of us who have been involved in the criminal justice system over the years know that drug dealing and drug use bedevil all levels of criminal conduct from the most serious to the relatively petty. The statistic given by the noble Lord,
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Lord Watson, that 26 crimes are committed per month per drug user indicates that in many instances it is the frequency of the offending rather than the gravity of the individual offence that gives rise to the greatest cause for public concern.
For many less serious offenders the last place to which they should be sent is some form of detention or imprisonment. Therefore, the greater range of alternatives to custody that is available the better. That is why this new idea is certainly worth trying out in the way that the Government suggest. The issue of resources is clearly relevant to its success. I hope that at Committee stage the Minister will explain to the House how this new idea will be funded both north and south of the Border.
I have greater difficulty in giving unqualified support to the proposals for anti-social behaviour orders and sex offender orders. I am aware that in recent months in Scotland the activities of bad neighbours and the whereabouts of convicted sex offenders in housing schemes have given rise to considerable public concern, but I have reservations about whether the right course is to give power to a local authority to initiate action in this field.
That will draw the local authority into disputes. If it is the landlord of both neighbours it may have to depart from the neutral position which one would normally expect and begin to take sides. Furthermore, individual councillors may be put under pressure to act. They in turn will encourage officials to do so. The decisions as to whether the applications are to be initiated may become motivated by political considerations and not a proper pursuit of public interest. There is also a problem with resources and of having a common policy throughout the country. It would be wrong for one local authority to have an aggressive policy and for a neighbouring authority with similar problems to have a different policy.
My greatest difficulty with the idea is how the local authority will be seized with all the relevant information to decide whether to take action. No doubt it will receive a complaint from the neighbours who are concerned about the anti-social conduct, but it will not have access to information which the police have and it certainly will not have access to the information which the Procurator Fiscal has. If there is disagreement between the chief constable and the local authority, and the local authority decides to proceed, that, too, could be a cause for concern. While not completely ruling out the idea, the issue must be looked at in great detail in Committee.
Another aspect of the proposals which causes me great concern applies to Clauses 18 and 19. I refer to the scope of the power which would be available to the civil court to regulate the behaviour or conduct of the individual concerned. As I construe the provisions, they would entitle a court to exclude an individual from the house which he tenanted and even the house which he owned. That raises certain issues under the European Convention. I would welcome an indication from the noble and learned Lord that in his view all the provisions of the Bill comply with that convention and with the provisions of the Human Rights Bill which is going through your Lordships' House.

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I turn briefly to the provisions relating to extended sentences. Again, some European Convention points may arise and I should welcome guidance on that. More importantly, I should be interested to hear the views of the Scottish judiciary on whether they welcome the proposal. I understand that the power would be available to sheriffs dealing with sexual offence cases and therefore it is important that their views, as well as those of High Court judges, are known before your Lordships enter detailed consideration of the clauses.
Finally, I turn to the provisions relating to racially aggravated harassment, taking into account racial aggravation, in sentencing. As your Lordships who have studied the Bill in detail will know, the provisions for Scotland are more limited in scope than those which are to apply to England. That acknowledges the fact that the Scottish criminal law is more flexible in dealing with such behaviour than may be possible in England.
Notwithstanding the fact that the provisions are more limited in scope, there is a considerable body of concern as to whether the Government are following the right lines. In the consultation responses which were submitted to the Government, a large number of bodies expressed opposition to the proposals and a large number expressed considerable reservations. Many welcomed the sending of a signal that racial violence and racially aggravated conduct should be seriously addressed, but when the detail of the proposals was considered a great deal of anxiety was expressed. The Faculty of Advocates, the Scottish Bar, has indicated that it requires to be persuaded of the advisability of making new statutory provisions. The Sheriffs' Association believes that the provision of new statutory offences would be unnecessary. It anticipates considerable problems in demonstrating and proving racial motivation.
Perhaps surprisingly, the proposals have met opposition from local authorities' social work departments. The East Lothian Council expressed the view:
"We are concerned that the creation of new offences, while sending out a clear statement of government views, may serve only to enable individuals to escape successful prosecution and punishment for their behaviour, and accordingly we do not support this course of action".
The body representing senior police officers in Scotland, ACPOS, believe that the proposal may be counter-productive. That view is shared by the sheriff principals, who consider the proposal to be contrary to principle and unworkable.
Those strong criticisms come from a wide range of consultees. I hope that when we discuss the provisions in Committee the Government will be prepared to answer them. As was said by the Lord Justice General, the noble and learned Lord, Lord Rodger of Earlsferry, in his response:
"So far as I am aware there is no aspect of racially motivated criminal conduct which cannot be properly tackled under the existing law if the racial element is brought to the attention of the police and prosecution and can be substantiated".
He remains to be persuaded by the arguments for the introduction of a new offence.
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The concern must be that if in the face of those objections the Government press ahead with the proposals for Scotland they will give two false messages. First, they will give the impression that this will achieve something for ethnic minorities in Scotland which cannot be achieved under the present law. Secondly, as was said by the Lord Justice General, the Government might send out the wrong signal to other sections of society. He stated that in Scotland:
"there are crimes inspired by religious hatred and hatred of homosexuals. If Parliament were to single out racial motivation, that might be perceived as suggesting that it was downgrading the seriousness of these other motivations… I am not sure what signal any enactment would send to society or to the courts about these kinds of behaviour".
Those are serious observations and I hope that when we discuss their detail in Committee each and every one can be addressed.
8.23 p.m.
Baroness Amos: My Lords, this is an extremely wide-ranging Bill and I welcome the Minister's clear exposition of it. A significant part of it concerns youth justice and I was pleased to see the move to a more restorative approach to the problems of youth crime. I also welcome the recognition within the Bill that tackling crime requires effective local and national partnerships. I particularly support the objective of nurturing the existing partnership process and establishing a legislative framework to ensure that the crime and disorder agenda is taken up and maintained locally to reflect local needs and priorities.
Other speakers in the debate have commented on some of the specific proposals relating to youth crime and anti-social behaviour. I wish to pay particular attention to Clauses 22 to 25, which deal with racially aggravated offences. For many years, I have campaigned for racial equality. As part of that campaign I have argued for the creation of a specific offence of racial harassment and racial violence. I have seen the impact of repeated acts of victimisation and violence on individuals and families and I have seen the build-up of anger, fear and resentment within ethnic minority communities.
In 1995–96, over 12,000 racial incidents were recorded by police in England and Wales. There is evidence to suggest that this is an underestimate. In May last year a survey was carried out for BBC Radio 5 on racism in the UK. There was a widespread view from participants in that survey that racism is a increasing problem in comparison with five years ago. Among African Caribbean and African participants in the survey, 60 per cent. felt that they had suffered some form of racial harassment. The figure for Asian participants was 40 per cent.
This is only a single survey—and I acknowledge that it dealt with perception—but data from the British Crime Survey also suggest that police statistics understate the extent of the problem. I therefore agree with my noble friend, Lord Watson, that there is no room for complacency.
We need to instil in our communities confidence that crimes of racial violence and racial harassment will be dealt with seriously. That is why I welcome the

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Government's commitment to tackling racial violence and harassment and their determination that the criminal law should be adequate to protect victims of crime which is motivated by intentions amounting to racial hatred.
I also welcome the related developments within criminal legislation, particularly the applicability of the Protection from Harassment Act 1997 to incidents of racial harassment, and within other legislation the positive opportunities arising from community safety orders and local community safety planning. It is a major step forward and offers some reassurance to ethnic minority communities about the Government's stated intention to be tough on crime and on the causes of crime.
I do, however, have some anxiety relating to implementation of the Bill and to an omission from it. There are a number of areas where the impact of the legislation should be strengthened and the Government's expectations of key agencies made clearer. I have been involved in a series of joint discussions on the practical implications of the proposals. These discussions have included the police, local authority representatives, community organisations and lawyers. There was concern at those meetings that, despite previous guidance and public consultation on using the powers in existing legislation, we have not seen a consistent application of those powers, or indeed adherence to existing guidance, across the main agencies.
The success of this legislation will rest on the consistency and priority afforded it by key agencies—particularly the police, the Crown Prosecution Service and local authorities. We shall need to ensure that mechanisms are put in place to enable us to judge how well those agencies are doing. This is particularly the case in the light of the findings of the Police Complaints Authority investigation into the death of Stephen Lawrence, which were published yesterday and which have already been referred to by the noble Lord. Lord Dholakia.
The results of the investigation show how under-performance and a low priority can lead to the mishandling of cases, and it shows how such failures undermine public confidence—particularly the confidence of ethnic minority communities—in the justice system.
I hope that the Government will take steps to ensure effective implementation of the Bill. There are three ways in which this can be achieved. Firstly, we need a review of existing guidance to all agencies on racial violence and harassment and the development of new, simplified guidance to all agencies. This would include information and some training. Secondly, a specific duty should be placed on all local authorities to tackle racial violence and harassment. This could be linked to the community safety partnership proposals elsewhere in the Bill. Thirdly, it is important that we put in place a mechanism to ensure independent scrutiny of the performance of agencies which are involved in dealing with cases of racially motivated crime. It could also be a requirement of policing plans and community safety
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plans that they include a section on dealing with racial violence and harassment. We need to be able to assess what progress we are making in creating a more equal and inclusive society.
Before finishing, I shall touch on one area of omission. It relates to criminal damage and particularly to racist graffiti—something which has been referred to by the noble Baroness, Lady Flather. Racist graffiti in particular can contribute to and underpin a culture of racial violence and harassment in some areas. The omission of criminal damage means that a substantial number of incidents will be outside the scope of the legislation. This will leave a confusing gap which will not be understood by local communities.
Although I have focused on my areas of concern. I repeat that I welcome the proposals on racially motivated crime. This is a good step forward but its effectiveness will have to be proved in practice.
8.35 p.m.
Lord Goodhart: My Lords, this is something of a curate's egg of a Bill. Parts of it are excellent—indeed much of it is excellent—but some other parts need amendment or should be approached with scepticism, and one or two need outright rejection.
We have listened to many valuable speeches tonight, notably the distinguished maiden speech of the noble Lord, Lord Watson of Invergowrie. I propose to be a little more detailed in my speech than most speakers in order to illustrate why the Bill will need great attention in Committee.
Let me start by looking at Clause 1, the anti-social behaviour order. We do not oppose it in principle; we accept the need for a stronger, more effective remedy against the so-called neighbours from hell. But its powers look, certainly at first glance, a good deal too wide. I share the concern of my noble friend Lord Rodgers of Quarry Bank and of the right reverend Prelate, the Bishop of Hereford.
There are also many problems with the text. Let us look at them briefly. The order is triggered by acts which cause alarm and distress, but what if the neighbours to whom the alarm is caused are unduly sensitive? Should there not be a requirement that the behaviour must be such as would cause alarm and distress to reasonable people? What is the proof of anti-social behaviour which is required before the order can be made? Is it the civil standard, the criminal standard or something in between? What happens if the subject of the order moves to another local authority district? It would obviously then be pointless to retain the order in force in the original district, but there is no procedure under the Bill for the transfer of the order so as to make it effective in the place where the subject of the order now lives.
I turn to Clause 2, the sex offender order. There is a serious human rights problem here. A sexual offender order will almost certainly contravene Article 7 of the European Convention on Human Rights if it is made where the offence has been committed before the Bill comes into force. The Bill certainly appears to permit this. Article 7 states that no heavier penalty should be
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imposed than the one that was applicable at the time the criminal offence was committed. I draw attention to the decision in the European Court of Human Rights in the Welch case, where a confiscation order in a drug trafficking case was held to be in breach of Article 7 because the offence was committed before the confiscation order was introduced by legislation. Indeed, I ask the noble and learned Lord, Lord Falconer of Thoroton, whether this Bill has been tested against the European Convention on Human Rights. Even if it is not necessary to do so until the Human Rights Bill is enacted, it is surely good practice to start doing so now.
Again, one might ask why, under Clause 2, there is no power to discharge a sex offender order within five years without the consent of the police. Clearly the police have a right to express a view on whether or not an order should be discharged, but it is a bad principle that the police should have a right of veto on whether or not to discharge an order made by a court.
I have serious reservations about the value of Clause 8 and parenting orders. Such orders require parents to attend counselling sessions. It is well known that counselling is useless unless the client is willing to accept it. Compulsory counselling is likely to be a waste of time and money and very difficult for the counsellor. Surely what is needed is a greater availability of family psychologists to help families that need help and are willing to accept it or can be persuaded, not compelled, to accept it.
Indeed, in many cases a parenting order would obviously be inappropriate. For example, what about a single mother with a violent 16 year-old son? She may risk being beaten up if she tries to control him and if an order is made, she is liable to a fine if she fails to control him or does not try to do so. Clearly in such a case, no order could be made.
I note and welcome the Government's proposal to run a pilot scheme but a modification is needed before the pilot scheme is introduced and I must say that I am sceptical as to whether parenting orders will work at all.
We welcome in principle Clauses 11 to 13 which deal with child safety orders. I have some problems with the drafting of Clause 11 and it should be noted that the standard child safety order appears to be made for too short a period. In the absence of special circumstances, the maximum period for which an order can be made is only three months. Surely an order needs to be longer if it is to be useful.
Clause 14 covers the local child curfew scheme. In that regard also there are serious problems. We certainly accept that children should not be out unsupervised late at night. But as drafted, Clause 14 produces some rather odd consequences. Where the order applies, it will be a breach for a nine year-old to be out kicking a football at five past nine on a bright June evening. It will be a breach for a nine year-old who has spent the evening with his grandparents to be brought home at five past nine by a 17 year-old brother or sister. Most extraordinary of all, it will be a breach for a 17 year-old mother to be out of doors with her baby. Technically, in each case it will be the duty of a police constable who discovers those breaches to report them. No doubt in
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practice, any constable would be too sensible to do so. But laws which rely on the police turning a blind eye bring the law itself into disrepute.
How will the order be publicised? If the order covers an estate, the notice will no doubt be put through all the tenants' doors. But will everyone read it and what about children who come to the estate from outside? As we all know, there is a very serious problem with gangs of children on some estates, but not all children on estates are unruly and the order should surely be targeted on misbehaving children and not on the area as a whole.
I turn to Part II. Unlike some noble Lords, notably the noble Baroness, Lady Amos, I have doubts about Clauses 22 to 25 dealing with racially aggravated offences. In my view, those clauses are well meaning but could be counter-productive. The problem is that there may well be pressure on the CPS not to prosecute for aggravated offences because of the extra time and cost involved and the evidential problems in proving racial motivation. As a consequence, where an accused is not charged with an aggravated offence or has been charged with an aggravated offence but is convicted only of the simple offence, the judge cannot properly take racial motivation into account as an aggravating factor in sentencing, however clear in practice it may be.
Clause 68, which we wholly support on these Benches, requires judges to treat racism as an aggravating factor. May it not be better simply to extend Clause 68 across the board and if existing maximum sentences are inadequate to cope with racially aggravated offences, extend those maximum sentences?
As regards Clause 27—doli incapax—I certainly agree that the presumption of incapacity is often contrary to common sense. But are the government right to abolish the rule altogether rather than to reverse the presumption so that there is a rebuttable presumption that the accused has capacity? Ten year-olds are not always responsible for their actions in the same way as adults and should it not remain open to the courts to investigate the criminal capacity of the child where there are grounds for believing that the child may lack capacity.
I am happy to say that we can give strong support to Part III. We certainly support the youth offender teams and the youth justice boards. Youth offender teams will of course cost money and we must ask how much central government are prepared to provide to local authorities to pay for them. Are the Government prepared to commit resources to youth offender teams and the other additional burdens falling on local authorities or will they expect the whole burden to fall on increased council tax payments which would cause impossible burdens for most local authorities?
I should say that we express strong support for the fast track approach to the trial of young persons under Clause 35. Trial of all cases should be quick, but that is particularly important for the young.
To Part IV we can give an almost wholly positive response. We support extended sentences and drug treatment and testing orders. We certainly support the principle of the new system of reprimands and warnings, although some aspects of it are too rigid and we have

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reservations about some of the details; for example, a restriction on the powers of the court to order conditional discharges. We support reparation orders, action plan orders, the strengthening of supervision orders and detention and training orders, although, as has been mentioned, there are some concerns about the reduction in age down to 12. We strongly support the clauses dealing with sentencing guidelines and the sentencing advisory panel.
Part V causes more difficulties. There is some concern with Clause 80 and in particular with Clause 81. Indeed, it can be said that Clause 81 contains what is perhaps the only wholly objectionable provision in the Bill. We do not accept that 15 and 16 year-olds should ever be remanded to prison or remand centres where they will come into contact with adult prisoners. Article 10 of the International Covenant on Civil and Political Rights, to which the United Kingdom is a party, requires accused juveniles to be separated from adults. The United Kingdom entered a reservation to that article, but only where there is a lack of suitable prison facilities or where the mixing of adults and juveniles is deemed to be mutually beneficial. Neither of those grounds appears to be applicable to the proposals in Clause 81. We believe that it is absolutely wrong to mix 15 and 16 year-olds with adult prisoners.
Clause 83 deals with electronic tagging for released short-sentence prisoners. We do not oppose it, but in our view it does not amount to a long-term solution and needs careful monitoring.
At this stage we can give the Bill a general and, in many respects, warm welcome. But it is obvious that many of its clauses will need very careful attention in Committee. That is certainly something that we on these Benches intend to give it.
8.49 p.m.
Baroness Anelay of St. Johns: My Lords, I add my congratulations to the noble Lord, Lord Watson of Invergowrie, on his maiden speech. We have had an excellent foretaste of the expertise that he will bring to our debates, particularly because it is experience of life in the inner cities.
We on these Benches support the Bill's objective of reducing crime, especially youth crime. Tonight we heard details from my noble friend Lord Windlesham about the high levels of juvenile crime. I recognise that action is needed to tackle the causes of youth crime and to make young offenders accountable for the actions that they commit. We proved our commitment to this objective while we were in government, and in opposition we will continue to do so. Crime prevention is, and has been, at the heart of Conservative Party strategy in fighting crime.
Like the noble Viscount, Lord Tenby, I too have been a magistrate, and when day after day you have looked into the faces and thereby into the lives of those who pass through our courts, you find yourself committed to finding ways of reducing crime. If legislation comes before this House which effectively seeks to reduce crime it will certainly find me supporting it to the hilt.
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However, I appreciate that, whoever is in government, there are always problems which have to be overcome in implementing major changes to the criminal justice system, so the comments I make today in winding up the debate for the Opposition are not intended to undermine the main objectives of the Bill but to raise questions about how best they may be implemented.
The Bill seeks to introduce a wide range of measures to tackle crime and, as often happens when governments seek to make a great number of changes in one fell swoop, it can look as though some details have not been thought through thoroughly. One example sprang to mind when reading Clauses 22 to 26 referring to racially aggravated offences. My noble friend Lord Henley pointed out earlier that the Conservative Party's position on this is clear: racism is wrong. Indeed, my noble friend Lady Flather pointed out that it is essential that public policy should reflect the displeasure felt by society against those who commit racist acts. Indeed, at the moment there are powers within the courts when sentencing to take racism into account when it is part and parcel of the reason why an offence has been committed.
When I sat as a magistrate the guidelines issued by the Magistrates' Association pointed out that racism in committing an act was an aggravating feature which had to be taken into account when assessing the seriousness of the offence itself. This Bill introduces racially aggravated offences. I question whether the court will have to specify how much of the sentence it imposes for such offences is for the racially aggravated part of the offence. If the extra penalty is not stated, how would the Court of Appeal deal with the matter later on appeal, and how would it know how to adjust the sentence if it were to be later determined that whoever had committed the offence had not done so in a racially aggravated manner?
My noble and learned friend Lord Mackay of Drumadoon put several questions on the matter of racially aggravated offences and the clauses with regard to Scotland. I never dare to stray into legal matters as they affect Scotland because I know I shall get it wrong; but I am sure that the noble Lord who is to wind up will be able to answer my noble friend's questions.
The provisions of the Bill significantly increase local government bureaucracy and create structures that will cross agency boundaries. There will be a youth justice board for England and Wales; there will be youth offending teams; and the local authorities and the police are required to formulate and implement a strategy for the reduction of crime and disorder in their area. Before formulating that strategy the responsible authority must follow all the directions contained within Clause 6(2), which I shall not read out at this late stage in the evening. But what occurs to me is that when they are publishing these results and keeping under review all these laudable actions that they have to take they will need proper resourcing.
As the Local Government Association points out in its briefing note, the key outstanding issue remains that of finance. Conducting a crime and disorder audit will

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be a new activity for all authorities, for they assume that any previous audits will not count and all authorities will be starting from scratch. All authorities will need to have earmarked staff in place to administer this strategy. Ultimately, the system will have to be arbitrated in the negotiations for the 1999-2000 local government finance settlement.
The Association of Police Authorities argues in its briefing note to us that it is unrealistic to expect that community safety strategies will be immediately self-financing for the savings achieved. It is essential to have investment to pump-prime developments. Have the Government plans to provide this, and can they give us information tonight about them?
What about the implications for other statutory and non-statutory bodies? Clause 5(2) requires a local authority to co-operate with other specified agencies in drawing up strategies and also refers to other organisations prescribed by order of the Secretary of State. Those could include churches, citizens advice bureaux, charities and a whole range of non government organisations. I certainly hope that they would be involved at that stage. They have an invaluable contribution to make. However, we should not forget that in taking part they would also have a great cost to bear in terms of their management time. The Government say that in time the Bill will produce significant savings for the criminal justice system, but I believe that there are a great number of areas where enforcing the provisions of the Bill will have cost implications immediately, especially for local authorities.
There seems to be considerable confusion on the part of the Government as to what the real cost implications will be. Frankly, the sections on the financial effects of the Bill are completely inadequate. For example, Clauses 80 and 81 amend provisions for remanding children and young persons to secure accommodation and, in the case of 15 and 16 year-old boys, to meet the specified criteria, to prison or remand centre. What estimates have the Government made of the likely increase in such remands and their consequent costs? Clause 80 gives the Secretary of State the power to implement the provisions in stages. How long a period of phasing-in are we talking about?
Clause 82 gives effect to the Government's policy for early release of prisoners who are serving from three months to four years. When opening the debate the Minister referred to "selected prisoners", but human nature being what it is, no doubt all prisoners will apply to be considered for this early release. Why indeed should they not? What estimate have the Government made of the cost of preparing and producing the reports required—costs which will fall upon the Probation Service and the Prison Service? What extra sums will central government be allocating to their budgets to cope with the extra work, and just what will be the criteria for deciding whether somebody qualifies for early release?
The Government have said that they want to use this Bill to reduce delay in the criminal justice system. I and others on these Benches welcome that. It is something that we always tried to achieve while in government.
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The noble Lord, Lord Williams of Mostyn, has sat as a Deputy High Court Judge, and he will recognise that there is always a tension between the need, on the one hand, to dispose of cases quickly and cost effectively and, on the other hand, to be fair to all parties, including the public. So when making changes we need to be aware of their impact, not only on the level of resources required but also on the role and functions of the courts.
I have concerns, which others have expressed tonight, about the implications of some of these clauses and some of the measures proposed in the Bill on the future of the lay magistracy. I hope measures are not being introduced which quietly, through the back-door, will reduce the value and the work carried out by the lay magistracy. I note the reassurances given recently by the noble and learned Lord the Lord Chancellor to the Magistrates' Association at its AGM. However, I would refer as an example to Clause 39, which gives metropolitan stipendiary magistrates the power to sit alone in youth courts. I ask why. I imagine the reason given is that this will increase speed and efficiency. That is something I have heard before in regard to other matters. But surely this is implying that magistrates should be used only if they are stipendiaries and eventually that lay magistrates will be bypassed.
I note that Clause 53 requires a police constable who warns a person under Clause 52 to refer that person to a youth offending team for assessment and, if appropriate, to make provision for him to participate in a programme to prevent further re-offending and secure his rehabilitation. I do not quarrel with the intention behind that, but is this in itself a way of providing a solution to a problem by imposing a method of treatment that would normally be seen as a court disposal but yet without ever getting the person in front of a court? It seems as though one is trying to obviate going to a court.
The noble and learned Lord, Lord Bingham of Cornhill, has tonight eloquently put the case—quoting from Clause 40—of the value of the lay magistracy. I thank him for the points that he made and merely endorse them in my own inadequate way. I also note that it is not only the magistrates' courts that are immediately affected by some of these changes but the Crown Court and that there appears to be a transfer of some duties from magistrates' courts to Crown Courts.
Clause 42 prescribes that there will be no committal proceedings for indictable only offences. At first sight that seems to be a sensible and cost saving measure. However, it means that paperwork will not be sorted out before it reaches the Crown Court. One role played by the magistrates' court has been to ensure that the paperwork served upon the defence is sorted out as far as possible before it reaches committal stage. That means that the Crown Court is able to get on with the job. Now people will be sent to the Crown Court before the disclosure of documents. It is a matter of transferring case paper management to the Crown Court. It also means that a person will have to wait months before he or she finds out what is the case against him or her. I hope that is not the case.

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Crown Court judges will have to become case managers writ large—in a way that I suspect they are not quite used to at the moment—reviewing the progress of case papers and the readiness for trial far more than is currently the case. What resources have been allocated to the Crown Court to deal with this? Has a like sum been removed already from magistrates' courts' budgets?
I am aware that there is already provision in serious fraud cases and cases involving children, for example rape of a child, to transfer cases to the Crown Court without the need for committal proceedings, but before they are transferred the prosecution must prepare the case and serve it on the defence and certify that in its opinion there is a prima facie case against the defendant. Could that same principle be applied to indictable only offences?
In opening for the Opposition my noble friend Lord Henley pointed out that we greeted this Bill with a qualified welcome. It is not qualified because we object to the principles behind it of reducing crime and reducing delay in the court system. We, like others tonight, express our concern that some of the provisions in this Bill will simply not be achieved because of the way in which the Bill is presently drafted. Like others we look forward to the Committee stage and the attempts that will be made to improve the Bill.
9.3 p.m.
The Solicitor-General (Lord Falconer of Thoroton): My Lords, I am glad to have the opportunity to speak at the end of what has been a wide-ranging and interesting debate. I know that during the passage of the Bill this House will give the Bill its close and expert examination as regards the important measures which it contains. As everyone knows, the Bill has 96 clauses and addresses six particular topics. It covers a whole range of issues from racially aggravated crime to creating new methods of disposal for the magistrates' courts and makes fundamental reforms as regards procedure in the magistrates' courts. I thought it was a little churlish of the noble Lord, Lord Henley, to ask, "Is this all?" when he made his opening remarks. In our view, this is a sensible, wide-ranging Bill. It is ambitious and innovative. The one thing that could not be said about it is that there is not enough in it.
Before I turn to particular points that have been made on particular parts of the Bill, I mention four themes that have arisen in the course of this debate relating to the principles of the Bill. First of all, the point has been made that we should not forget the causes of crime. That was a point made by the noble Lord, Lord Rodgers, the right reverend Prelate the Bishop of Hereford, the noble and learned Lord, Lord Ackner, and a number of other noble Lords. We do not forget the causes of crime. If I may say so with respect, the noble Lord, Lord Rodgers, slightly down-played the welfare to work provisions and the social exclusion unit. In a Bill which is, as it were, a criminal law Bill and a criminal procedure Bill, one would not expect to address the causes of crime. That is a matter for some other kind of legislation and for government policy.
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The second theme that emerged in the debate was that of reducing the prison population. It was said that that matter was not addressed by the Bill. With respect, I take issue with that proposition, advanced by the noble and learned Lord, Lord Ackner, the noble Earl, Lord Longford, the noble Lord, Lord Rodgers, and a number of others in the course of the debate. This Government take the view that a certain number of offences are serious and require custody as a response. That is a view that has been taken by successive governments. If one does not take that view, confidence in the criminal law is reduced. This Bill, however, attempts both to reduce offending and to reduce the prison population. As regards reducing offending, there is a large number of measures which are designed to offer the courts alternative methods of disposal which allow the court to provide an answer that the public will have confidence in and which are not custody. In addition, the home curfew proposals will, when fully operative, reduce the prison population by perhaps as many as 6,000. Therefore the question of the prison population is addressed to some extent both in terms of reducing offending and, it is hoped, reducing the prison population.
The third general theme is a concern that was expressed in particular by the right reverend Prelate the Bishop of Hereford; namely, that this is a Bill about containment, not prevention. Again I take issue with that. The Bill contains important preventive measures—for example, antisocial behaviour orders, sex offender orders and crime and disorder strategies. These are all important provisions aimed specifically at preventing crime. As the noble Lord, Lord Windlesham, pointed out, Clause 28 sets out for the first time the principal aim of the youth justice system to prevent offending by children and young people. The work of the inter-agency youth offending teams will focus on preventing offending and re-offending. The many parts of the Bill designed to get agencies in the locality working together to prevent crime are certainly designed to provide not containment but prevention. The Bill is designed to get the community as a whole working on strategies to reduce crime.
The fifth, and final, general point is one that came across in the remarks of many noble Lords; namely, the important part that voluntary agencies can play in developing strategies, dealing with crime and assisting the community to move forward. We entirely agree with that in relation to the Bill. The measures in Clause 5 in relation to the inter-agency panels that the Bill envisages include provision for permitting the Home Secretary to designate the bodies that will sit on those panels, and they will include various voluntary agencies. That is a provision with which I believe we all agree.
To turn to more specific points, it would be impossible, having regard to the wide range of matters raised in the course of the debate, to deal with every point raised. Many will be more suitably dealt with during the Committee stage. However, perhaps I may deal with a number of general themes that have arisen in relation to particular parts of the Bill.

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First, in relation to the antisocial behaviour orders, a number of noble Lords indicated that they did not want the orders to become a means of getting at people who were simply eccentric. We entirely agree. That is neither the intention nor the effect of this measure. The purpose of the antisocial behaviour order is to deal with behaviour that is so intrusive as to make a real, unpleasant impact on neighbours and others affected by it. The noble Lord, Lord Watson of Invergowrie, made the point in an excellent maiden speech that, although it is difficult to define, one is certainly able to recognise such behaviour when one sees it. The right reverend Prelate the Bishop of Leicester referred to mediation and wondered if that might present a solution. We believe that in some cases it will be a solution; but it will not be in every case—and, if it will not he a solution in every case, then there is a place in the panoply of powers open to magistrates' courts for the antisocial behaviour order as a civil order.
To turn to the section on local crime strategies, the right reverend Prelate the Bishop of Leicester suggested that it was at the heart of the Bill. We see it as a very important means of getting the community working together on crime strategies. It is important to involve all the vital agencies on a cross-agency basis. As I said, we are keen to include all the voluntary agencies.
In relation to the antisocial behaviour order, perhaps I should have dealt with the point made by the noble and learned Lord, Lord Mackay of Drumadoon, as to whether people can be excluded from their own home under such an order. You can only be prohibited from living in your own home if it is established before the court that that is necessary for the protection of the public. That is the same test as applies under Article 8.2 of the European Convention on Human Rights and therefore would not offend against that convention.
The noble and learned Lord, Lord Mackay of Drumadoon, and the noble Lord, Lord Goodheart, asked whether the Bill has been "ECHR-proofed". We accept that, like other criminal justice measures, there may well be challenges to the legislation under the European Convention on Human Rights. We have accordingly considered the provision most carefully and have concluded that it is compatible with the convention. I believe that that answers the question of both noble Lords.
To turn to doli incapax, the noble Lord, Lord Henley, asked rather optimistically whether it was causing any problem at the moment. The position in relation to doli incapax was very well described by the noble and learned Lord, Lord Ackner, during the course of his remarks. The position is that at the moment it has to be proved that the defendant knows that what he or she is doing is wrong. That process is being used in a manipulative way in many courts by defendants, who say, "You have to bring a teacher, a social worker or some mature adult in order to prove this". It leads to difficulty with the calling of witnesses; it is hoped on the part of many defendants that this will make the Crown Prosecution Service bring its proceedings to a halt; it clogs up the youth court; and it is simply designed to make the proceedings more difficult. So the answer to the question is: yes, it is causing real difficulties. It
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offends against common sense that you have to prove it. The possibility is not ruled out, where there is a child who has genuine learning difficulties and who is genuinely at sea on the question of right and wrong, of seeking to run that as a specific defence. All that the provision does is remove the presumption that the child is incapable of committing wrong.
To turn to the detention and training order, it was suggested by some noble Lords, in particular the noble Lord, Lord Henley, that the detention and training order would simply involve sending more young people to "academies of crime". The detention order is not about locking up more children and putting them into an academy of crime. It will replace the sentence of detention in a young offenders institution of 15 to 17 year-olds and the secure training order for 12 to 14 year-olds. It will not initially be implemented for 10 and 11 year-olds. It has two clear advantages over previous arrangements. It will give a clear incentive to young people to make progress. If they do well while they are in the detention centre they will be released early.
Secondly, there is scope for the Secretary of State to determine where offenders of different kinds should serve the custodial part of the order, allowing youngsters to go to the most suitable accommodation. So far from being an academy for criminals, making them worse, it is hoped that they will improve there and also that there will be a wider range of places that they can go to.
On parenting orders, concern was expressed by a number of your Lordships, in particular the noble Viscount, Lord Tenby, and the right reverend Prelate the Bishop of Hereford that some of the parenting orders would not be of assistance. Examples were given of parents who had completely lost control of their children. How unfair, it was said, that those parents could be made liable themselves for being unable to control their children after a parenting order had been made. Before a parenting order can be made under Clause 8 of the Bill, the magistrates' court must be satisfied that it will contribute to the reduction of offending or similar behaviour by the young person. If the position is that upon examining the facts it becomes clear that the parent will have no effect in relation to the child's behaviour then the provisions of the Bill are such that no parenting order will be made. So the concerns expressed by noble Lords and the right reverend Prelate in that respect may be misplaced.
We believe that there is a place for the parenting order. It includes providing counselling and guidance to parents. It will be ordered by the magistrates' court when that court believes it can help the parents both by giving them guidance and by making it clear to them that they have a responsibility for their children's offending behaviour.
On magistrates' clerks, the noble and learned Lord, Lord Bingham of Cornhill, made the point that he was extremely uneasy—and that may understate his concern—about clerks exercising judicial power. He rightly pointed out that in Clause 40 the Bill gives the Secretary of State power to designate to clerks the power that he can designate to single lay justices. The

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position is that the clerks already exercise some judicial powers in relation to family proceedings. The judgment of what is suitable for them to do will obviously have to be made at some stage. The scheme will be piloted. We very much take into account the noble and learned Lord's constructive comments about what would and would not be suitable, and they would certainly be taken into account in any order made.
I move on from there to Clauses 80 and 81 on the committal to secure accommodation or prison of boys aged 15 and 16. Points were made from all sides of the House along the lines of, "This is a point that has caused this Government concern when in opposition. What is the present position?". The position is as follows. Remanding to prison 15 and 16 year-old boys is a longstanding issue which the previous Government failed to resolve. We are fully committed to ending prison remands for 15 and 16 year-olds as soon as we can. The courts will, subject to certain criteria and where a place has been identified in advance, be able to consider remanding direct to local authority accommodation those 15 and 16 year-old boys who are the most vulnerable in that age group, in addition to all 12 to 14 year-olds and 15 and 16 year-old girls. But it is not possible to do so for all 15 and 16 year-old boys while practical difficulties exist caused by lack of sufficient secure places.
While a building programme was put in place to provide 170 new secure places in local authority accommodation for that purpose, the number of juveniles remanded in custody has increased significantly since the building programme began, and prison remands of 15 and 16 year-old boys now range between 250 and 300.
The demand from that group alone would significantly outstrip the capacity of the local authority secure estate, even once the building programme has been completed, seven years after the provisions of the 1991 Act were put in place. We shall not lose sight of the problem but we believe that our proposals represent the most effective and practical way forward.
The noble Viscount, Lord Tenby, made a number of important points about local authority secure accommodation, including inspection and the need for more places. It is too late in the evening and I have spoken for too long to answer all the specific points that he made, but perhaps I may write to him with answers.
Lord Henley: My Lords, on that point perhaps this may be a suitable moment to ask the noble and learned Lord whether he would agree to this suggestion. He has been most conscientious in the replies he has given and has covered a great many points put forward by Members on all sides of the House. However, we would like the guarantee that he will answer by letter all the points which he was not able to deal with. He might then find that it would speed up the Committee stage process, since he said that many points would be more appropriately left to that stage. If he or his noble friend
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could write to noble Lords on points not covered, then I and probably other Members of the House, including the noble Viscount, Lord Tenby, would be grateful.
Lord Falconer of Thoroton: My Lords, we would be willing to do that. We shall have to go through Hansard and see which points it will be appropriate to answer. But, in principle, we would do that and one hopes that it would shorten the Committee stage of the Bill.
In the light of that, perhaps I can deal with two further matters of principle that formed an important subject of debate. The first is that a considerable number of questions were asked and points made in relation to racially aggravated offences. It would be fair to say that there was a broad welcome for legislation on racially aggravated offences. Some people asked if it was necessary and, if not, why were the Government introducing it.
The Bill makes two important improvements to the current law. It increases maximum sentences in relation to racially aggravated crime. Also, it creates the offence of a racially aggravated crime. Those new crimes are in the Bill in order to underline the importance that this Government attach to stamping out racially aggravated crime. The effect of including the provision in the Bill and making it a crime is that it will compel the evidence gatherers in specific cases to focus upon the issue of racial aggravation in respect of those matters. We believe that that is a good thing and an important message to send to the world.
The noble Baroness, Lady Flather, asked why it does not apply to all crimes. Practically speaking, one cannot attach racial aggravation as an element to every crime. However, Section 68 of the Bill says that in all crimes racial aggravation will be a factor that can increase the sentence. We therefore believe that we have gone a significant way to meet what the noble Baroness, Lady Flather, would wish.
We note and take account of what the noble Baroness, Lady Amos, said: that is, that effective implementation is important. We agree with that and will bear that very much in mind. We believe that these provisions make a real difference; it is worthwhile to include them in the Bill and therefore we intend to proceed with them.
In relation to Scotland, I take on board what was said by the noble Baroness, Lady Anelay, and stray into Scottish law with considerable reluctance. We are aware that certain elements of the legal order—if I may call it that—suggested that there was no need for this Bill in Scotland. However, certain parts of the community in Scotland, in particular ethnic groups, felt that it would be worthwhile to introduce this provision into Scotland. Taking full account of the consultation we had, including the remarks of the noble and learned Lord, Lord Rodger of Earlsferry, we nevertheless decided that it was an appropriate course to take.
The noble Earl, Lord Mar and Kellie, felt that we should not be legislating at all in relation to Scotland because of the impending devolution Bill. That is one view. But, as it will be two years before the Scottish parliament is capable of passing any sort of Bill, that

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seems rather a long time for Scotland to wait for any legislation of any sort. We therefore did not accept that view.
The other issue on which I should like to touch concerns sentencing guidelines. The noble and learned Lord, Lord Ackner, said that we should not interfere with the judges' discretion. We do not believe that we are interfering with the judges' discretion. It is good for consistency that judges give guidelines on certain issues. The structure of the Bill is such that, if the court does not think it appropriate to give guidelines, it is not obliged to do so. We are grateful to the noble and learned Lord, Lord Bingham of Cornhill, for saying that he is broadly content with the provisions in relation to sentencing guidelines.
I apologise for going on for so long, and I apologise for not answering every question that has been raised. Speaking for myself, I have found the debate immensely useful, immensely constructive and, having regard to the tone and quality of the debate today, I believe we will have an excellent debate at Committee and Report stages.
On Question, Bill read a second time, and committed to a Committee of the whole House.

Firearms (Amendment) (No. 2) Act 1997 Compensation Scheme
9.25 p.m.
Lord Williams of Mostyn Lord Williams of Mostyn rose to move, That the draft scheme laid before the House on 27th November be approved [15th Report from the Joint Committee.]
The noble Lord said: My Lords, this draft scheme has been laid under Section 18 of the Firearms (Amendment) Act 1997, as amended by the new Firearms (Amendment) (No. 2) Act.
Since 1st July of this year an ex gratia scheme has been in place covering payments to those who have chosen to hand in their small-calibre pistols rather than await the passing of the new Act. To date, over 26,000 of these firearms have been given up, in addition to the 116,000 large-calibre handguns that were surrendered in the three-month period from 1st July. Over £27.6 million has already been paid out from the scheme. Of course, the final figure will be higher when the remaining claims and ex gratia applications have been processed.
The scheme we are considering today is virtually identical to the ex gratia scheme. We have given assurances that those who chose to surrender their small-calibre pistols voluntarily under the ex gratia scheme would not be disadvantaged compared with those who have waited to surrender their pistols under the formal scheme. That is why the two schemes must be consistent.
We estimate that no more than 10,000 pistols are still held lawfully throughout England, Wales and Scotland. This is a little under 200 firearms per police force. The police assessment is that this number of firearms can be
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processed within one month, and we have therefore set the surrender period as 1st to 28th February 1998. All the necessary documents can be sent out by police forces in good time to potential claimants. In setting February as the hand-in period, we did not forget that the second anniversary of the Dunblane tragedy falls on 13th March.
The scheme itself will operate in the same way as the main compensation scheme already agreed by this House on 9th June. Before the hand-in period begins, certificate holders and dealers will receive full details of the new scheme together with application forms and advice on where and when to surrender their weapons. They must complete the appropriate claim form in respect of their weapons and equipment and hand this to the police at the time of surrender. Individuals will have a choice of three options. They may choose to accept a flat rate of £100 for their weapon. Alternatively, they may choose a standard rate for their weapon from the list of published values at Annex A for the most commonly held pistols. If they do not wish to accept the flat rate payment, and if their gun is either not on the list at Annex A or is markedly different from those that are on the list, they may choose the third option. This means a submission of claim, supported by an independent valuation or other evidence corroborating the value of the items surrendered. An extract or copy from a published source as at 16th October 1996 would often be acceptable and therefore an individual valuation will not be necessary in every case.
Similar arrangements will apply to dealers. They will be able to claim under any of the three options. They will be able to claim under the third option even though their stock may already be listed at Annex A.
The firearms must be handed over to a designated police station, as specified by the relevant chief constable. Special arrangements will be made with dealers because of the number of weapons they may have in stock.
Similar arrangements will apply to ancillary equipment which can only be used in connection with the pistols. The corresponding values are set out in Annexes B, C and D of the draft scheme. This is in accordance with the requirements of Section 17 of the 1997 Act (and Section 16 in respect of expanding ammunition) as amended by the latest Act. As under the previous scheme, this equipment will not itself become prohibited but the Government accept that where it cannot be put to any other use, such as with rifles, then compensation should be paid.
The claim forms will initially be checked by the police who will then send them to the Firearms Compensation Section of the Home Office for processing.
There are two points of detail in the scheme that I should draw to the attention of the House. First, two operative dates are mentioned in the scheme: 14th May 1997 (for possession of the firearms or equipment on the date of the Queen's Speech when the Government formally announced their intention to ban small-calibre pistols) and 16th October 1996 (for the values at the

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time when the previous Government announced their intention to ban large-calibre handguns). When calculating the values of small-calibre pistols for the ex gratia scheme it was agreed to use the same October 1996 date because values for all handguns generally fell from that point. Taking the values as at 14th May 1997 could have given rise to criticism for treating shooters unfairly. Taking the earlier date is, we believe, in the best interests of shooters. I explained the reason to the House on 9th June.
For the sake of precision we have added three categories of ancillary equipment to the scheme: speed-loaders, speed-loader pouches and quantities of spare parts held by registered dealers. Component parts which have to be held on a firearm certificate, such as barrels and cylinders, were already in the ex gratia scheme.
We have decided to add these three categories because they were appended to the earlier compensation scheme after it was approved, but on an ex gratia basis. These three categories were genuine oversights and as payments are being made on them under the previous scheme it is only right that they should be included specifically in the new scheme and that the House should have the most up-to-date information possible available to it today.
We have not added additional pistol makes to the annexes because of the need to keep the schemes consistent and not to prejudice those who had chosen to hand in their pistols early. Any pistol not listed will need to be claimed for under options A or C. I have already indicated that an extract from a published source on or before 16th October 1996 will generally be acceptable as evidence of value and an individual valuation will not always be necessary.
I wish publicly to thank the people working in the Firearms Compensation Section who have moved a mountain of paperwork so that people get their compensation as quickly as possible. I regret that there has been some attempt to undermine confidence and to criticise the rate at which claims under the large-calibre scheme are being dealt with.
I am able to tell the House about the progress that has been made. As at 12th December, 39,896 claims have been received, and 23,183 payments have been made, to a total value of £27.6 million. Most claims under options A and B will have been dealt with before the end of March, and regular payments on option C claims will have begun by then. Some dealers who have claimed under option C will already have received at least an interim payment by now. The additional new claims in respect of up to 10,000 guns will add to the current pressures upon the FCS but the processes and procedures involved in dealing with these claims will be no different from those already in train.
There were teething troubles with the purpose-built FCS computer system which slowed down the initial processing rate. We hope that those teething problems have been completely overcome. Staff are working hard to deal with claims as quickly as possible. Weekend overtime is being worked and measures have been taken
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to boost the number of staff engaged in the primary task of examining claims. The work is not simply the automatic payment of claims when received. All the claims have to be examined carefully to ensure that the items surrendered are eligible for compensation under the scheme and that the correct scale of payment is made. We are committed to keeping up the pace of processing the claims but we cannot lose sight of the need to maintain the proper checks and balances to ensure correct payment and prevent fraud.
It is not a simple rubber-stamping exercise. A great many claims—unfortunately, about 35 per cent. of those received—have been wrongly completed. Common mistakes include descriptions of items not matching the code numbers on the published list; lack of details under certain headings, such as "specialised tools"; and payment details, such as bank account numbers, are sometimes wrong. If 35 per cent. of forms are not properly completed, that adds to overall delay and takes up valuable staff time to resolve. Unfortunately, a number of cases of possible fraud have come to light and are presently the subject of criminal investigations. I cannot give details of those cases, for obvious reasons. But we are dealing with public money and we have to be careful about the mechanisms in place to control and avoid fraud.
We are looking at ways and means of improving the throughput of cases. There have been improvements. In July the total number of payments was only 351 because of the problems with the computer system. In August the number of payments rose to 2,602 and in September to 4,091. This improvement has continued. The average number of weekly payments is now running at 1,400.
We are keeping the promise of compensation which is reasonable and which is paid out in order to fulfil our promise to the British public to end private ownership of handguns. The scheme is no more and no less than the ex gratia scheme that has been in place since 1st July. There have been no major criticisms of that scheme which, we believe, properly compensates the owners of small calibre pistols and related equipment. I commend the scheme to the House.
Moved, That the draft scheme laid before the House on 27th November be approved [15th Report from the Joint Committee].—(Lord Williams of Mostyn.)
Lord Henley: My Lords, I am grateful to the noble Lord for agreeing to take this order tonight rather than on Thursday, which might have caused both myself and, I suspect, the noble Lord a little more inconvenience.
There are one or two questions that I wish to put to the noble Lord. He has dealt with some of them in his admirable opening remarks about this order. They are particularly my concerns about delays and the timescales in dealing with claims. Perhaps he will elaborate a little on where we are precisely at the moment in terms of how long it is taking to deal with particular claims. The noble Lord seemed to imply that as regards claims being dealt with under Options A and B there were relatively few problems. It was cases under Option C where matters were more complicated.

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Having said that, would it be worth considering leaving Option A and B payments to simple across-the-counter payments, to be dealt with presumably by the police, rather than coming to the FCS and therefore taking up Home Office time, thereby leaving its officials more time to deal with Option C cases? It may be too late in the day to move to such a system, but it might have been an approach considered earlier on.
In the light of the fact that there are delays, about which we have heard anecdotal evidence, and more than that, will the Government consider whether there is a case for paying interest on late payments, particularly those where the delay is more than the 30 days (which we suggested as a maximum when the Bill was going through Parliament), let alone the 30 days which the Government have always put forward as the proper limit for business to observe?
I make that point because, as I believe will be the case in the Bill coming before another place relatively soon, business late payments will be subject to interest, as is the case with those of us who occasionally manage to pay our income tax late. It is possible to be charged a level of interest, just as the Revenue occasionally pays a degree of interest on its late payments when making refunds for overpayments. There is quite a strong case for the Government to consider whether interest ought to be paid, particularly as regards those cases where through no fault of the applicant there are delays in the department. I do not want to criticise the department because it has had to deal with a great number of applications coming through the system, some of which have been complicated. But it is a case that the Government should consider seriously.
I have one further question. I do not know whether the noble Lord will be able to answer it at the moment. He kindly wrote to me on 4th December and told me that about 26,000 small calibre pistols had been handed in and another 10,000 were due to come forward. Of those 26,000, I shall be interested to know how many claims have come through to the FCS already and how many are still at the different police stations throughout the country. I would like to know whether there are delays there before the claims are reaching the Firearms Compensation Section. That might be a process that can be speeded up. If the noble Lord does not have the answer at the moment, I shall be more than happy for him to write to me in due course.
Lord Williams of Mostyn: My Lords, I am most grateful to the noble Lord, as always, for his courteous approach. I shall obtain the up-to-date figure for the 26,000 and I shall write to the noble Lord as he invited me to do. I try to keep him fully in the picture. But the figure I have is the one that I gave him up to 4th December. I shall write to him as regards his last question.
The Option A and B claims have already been submitted to the FCS and therefore there would be a further delay if they were then sent back to the police. As the noble Lord implied, and I believe, understands, the scheme has been specifically set up in the way that
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the FCS is operating it. Therefore, it would be a waste of its time and a hopelessly inefficient use of police time if we went that way.
On the question of interest, I must point out that these are not ordinary business transactions. We cannot make payment immediately on receipt of a claim. Claims have to be fully considered. We do not take the view that adding interest to the compensation payment is appropriate. Indeed, one takes the view—perhaps this is not susceptible to argument because it is simply the view that has been taken—that we do not believe that it would be a justifiable further drain on public funds because we do not think that we have been unreasonable about the level of compensation.
I thank the noble Lord generally for his approach. I have tried to reciprocate it by, for instance, conceding the amendment that he put forward, having taken on, as it were, the baton of civilisation from the noble Baroness, Lady B latch, in respect of the nature of the compensation scheme. I cannot stress enough that I appreciate the way in which he deals with such matters.
On Question, Motion agreed to.

Independent Television Commission Codes
9.40 p.m.
Viscount Astor Viscount Astor rose to ask Her Majesty's Government what changes are necessary to the Independent Television Commission Codes to allow publishers and television companies to produce programmes for terrestrial television based on magazine titles in the same way as currently allowed on the BBC, satellite and cable.
The noble Viscount said: My Lords, there are two main reasons why I feel it important to introduce this topic. First, I believe that the Government and the Independent Television Commission have a fundamental misunderstanding of what is known in the industry as "masthead programming." I believe that the current policy is unfair to ITV and to Channels 4 and 5. Secondly, there seems to be no clear view at the ITC of what its policy will be for the proposed terrestrial digital broadcaster, BDB, when it comes into play.
The current ITC position is to allow masthead on satellite and cable but not on terrestrial stations. I believe that that is an anomaly and I find the reasons for the decision unconvincing. In commercial television the ITC has traditionally regarded publishers in the same category as advertisers and has seen masthead as just a way of promoting print titles rather than as a way of providing new material for television.
I should perhaps say something about what masthead broadcasting actually is. Masthead programming is not just a way of offering free promotion to a magazine; it is much more. It is the development of intellectual property by those who have the resources and the editorial expertise. It is production supported by magazines, using their expert knowledge. It is a way of re-creating a magazine—or, indeed, part of a

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magazine—as a programme in the format that suits the viewer. It is not an extended commercial and it is not a direct promotion for sales or sponsorship.
Sponsorship is done in other ways. In fact, viewers of ITV will find it hard this Christmas to escape sponsored programmes. Toyota, for example, has signed up a five-year £18 million sponsorship deal for New Year. Sponsorship currently brings in £40 million to ITV: it is a growing but, I stress, separate market.
The BBC is currently allowed masthead programming and, as your Lordships know, it does not come under the ITC. The BBC has launched successful magazines off the back of its most popular programmes. It has also developed programmes from magazines. Good Food began as a BBC publication and is now a hugely popular programme with full brand visibility throughout the show. The BBC's "Gardener's World" is now a very successful programme and, indeed, a major event at the Birmingham National Exhibition Centre.
The BBC has another advantage. It can commission a long series of programmes linked to a magazine which address a specialist audience. ITV and Channels 4 and 5 do not have the freedom or opportunity to reach such audiences. Although under an agreement with the Office of Fair Trading no programme on the BBC may mention a BBC magazine in the course of that programme as an encouragement to buy, so-called "legitimate editorial reference" to the magazine is allowed.
Cable and satellite are also exempted from the rules. They were regarded as almost extra and have no public service remit. The past two years have seen consolidation among the cable operators to the point that 65 per cent. of the UK's cable systems are now controlled by two groups.
It is interesting to compare our approach with that of Europe and the rest of the world. There are only two countries in Europe which have not taken a more progressive approach, France and Sweden. They are the only countries that regard print publications as a special category and therefore subject to different rules. In France, as with many regulations, I am afraid that only lip service is paid to the rules. In neither America, our main competitor, nor Australia are there any restrictions.
Soon we shall see the launch in this country of BDB. This will provide a huge proliferation of channels, choice for the viewer and a need for programmes. It will mean interactive dialogue through the system. The interactive capacity will make it possible for publishers, if allowed, to recreate the magazine experience in television. Viewers will be able to view masthead programmes at a time that suits them. Perhaps even more remarkable is that digital will enable viewers to select pages of a magazine or different camera angles while watching a sporting event. For example, in France, Germany and Italy one can now watch Formula One grand prix from several vantage points. As I understand it, the ITC sees no logical reason why BDB should not be in the same category as cable and satellite, but has not finally decided.
BSkyB is to launch its own satellite digital channels next year. BSkyB already receives a huge amount of promotion from its newspapers and gives promotion to its newspapers that are part of the Murdoch empire. This is at a time when its non-sport and movie channels have small audiences.
What is the Government's view on terrestrial digital? In order for BDB to plan for its launch it must have an answer from the ITC. I understand the position to be that ITC intends to allow masthead on BDB. Can the Minister confirm that this evening? If so, it begs the question: why not ITV? I understand the concern of the ITC that it does not want peak hours dominated by masthead programmes, but there are many off-peak hours that would be suitable. Much more importantly, there are regional slots in each of the 15 ITV regions that need good programming. Relaxation of the rules would improve programmes for these markets. The more spent on production, the better the schedule for the viewer.
Regional programming is important. Do the Government really believe that if Farmers Weekly produced a programme on sheep farming for Border Television that would not be beneficial for Border viewers? There is already a control system. The ITC has an advertising and sponsorship directorate and the terms for cable and satellite for masthead are found in its code of programme sponsorship.
There is no evidence that viewers have so far had any reservations about masthead programmes that they have seen on the television; quite the reverse. Viewers enjoy this new relationship between television and text. Quality can be maintained. The experience from America I believe proves the point. For example, National Geographic Television is masthead's first global brand. It is high quality and very successful.
This is an industry where the old divisions between newspapers, publishers and television are being broken down. You can read a newspaper on the television, read a book on the Internet and watch television on a computer. To compete with the rest of the world and multimedia conglomerates rules that hinder the development of our media industry must go. They have gone in nearly all of our competitor countries. At the moment the only multimedia company in this country is in effect the BBC, which is allowed to do what ITV, Channel 4 and Channel 5 are not allowed to do. If the Government care about the ability of the industry to export its product and prevent the dominance of the industry by US material that has happened so often in the past in broadcasting, they must act.
I know that the Government care about the independent production sector in this country. Relaxation of these artificial rules would give the independent sector an enormous boost. They are the ones with the expertise to make programmes. The industry will also be able to cut costs and be more competitive. Your Lordships will also remember that payments from Channel 4 to the ITV companies are being phased out and the ITV companies are being asked to renew their franchises. The Treasury currently extracts £450 million a year from ITV. If the Treasury

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wants the maximum revenue, ITV must be competitive, so a change of the rules is necessary for it to compete on equal terms.
The current rules are an anomaly. For example, they allow Channel 5 to air features produced in conjunction with magazines and newspapers in its news programmes. The rules are not all the same.
Perhaps I may return briefly to the public service remit. I do not believe that there is a difficulty for channels which have a public service remit and those which do not. The situation for the BBC proves that that is not a problem. Television viewers in this country have a right to quality and choice. I believe that magazine publishers have a great deal to offer terrestrial television which could be new and exciting for the viewers. Earlier this year the ITC agreed to review the case for allowing masthead programmes on terrestrial channels next year. I hope that tonight the Minister will be able to announce that the review will take place sooner rather than later. I look forward to her reply.
9.50 p.m.
Lord Gordon of Strathblane: My Lords, I have no wish to detain the House from the pleasure of hearing my noble friend Lady Ramsay of Cartvale replying to the debate and speaking for the first time at the Dispatch Box. Therefore, I shall be brief.
Two issues are involved. First, broadcasters, particularly those in television, should not abuse the considerable promotional power which they enjoy as a result of having exclusive access to that medium. I can fairly say that I approach the question neutrally and can see both sides of the argument. The truth is that I have been on both sides during my short career in broadcasting.
In the early days of Radio Clyde, the commercial radio station which I started in Glasgow, we were aware that our presenters were running discotheques in the evenings, quietly mentioning on air, "To those of you I met at the XYZ discotheque, thank you for a lovely evening and I will play this record for you." It occurred to me that it was entirely appropriate that we should run the discotheques and derive the benefits.
That seemed fine and I did it in all innocence. There was then a complaint to the Independent Broadcasting Authority from discotheque owners in Glasgow stating, "These chaps on Radio Clyde have the benefit of free advertising and that is an unfair advantage." There was a great deal of merit in the case and rules were introduced which stopped our promoting on air discothèques we were running unless we were actually broadcasting them.
On the other side of the coin, I may have approached the noble Viscount, Lord Astor, when he was a Minister at the Department of National Heritage and I was chairman of the Commercial Radio Companies Association asking for some curbing of the BBC's tremendous power to cross-promote radio and television, which the commercial sector does not enjoy. Even if we were able to strike a deal with the commercial television companies in our areas, recent changes prohibit an ITV company giving free
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promotional time to a commercial radio station. It must take that out of its advertising time, which is distinctly unattractive.
I am aware of the distinct benefits conferred on great works of literature by their serialisation on television, commercial or the BBC. It may shock the House to know that I welcome that. If the only thing that brings people to Jane Austen or Evelyn Waugh is the serialisation of Pride and Prejudice or Brideshead Revisited, so be it; it is part of the educational process and it is one of the good aspects about public service television in this country.
Furthermore, the BBC inevitably promotes certain programmes in magazines. That was the subject of an OFT reference which I believe went to the European Court. Rules were drawn up to ensure that the BBC could not steal a march over other commercial magazine publishers by promoting its own magazines. The BBC is a large magazine publisher. The main difference in all that and masthead programming is that in the former the magazine follows the programme. The idea is to allow the programme to come from the magazine publishers. I have no objection to that in principle, provided certain points are observed.
The noble Viscount slighted overstated the case when he assumed that there would be a great creative explosion. Magazine publishers do not have the technical resources to make television programmes. They would go either to the terrestrial broadcasters or to independent producers, which might be welcome. Therefore, their infusion is not likely to be creative but rather financial. It is none the less welcome for that.
The problem is that control, both editorial and otherwise, must remain with the broadcasters. I am one of those who did not welcome the Broadcasting Act 1990. The only thing that could be said for it was that it might have been a good deal worse had it not been for a considerable rearguard action by the Home Office team under the noble Lord, Lord Hurd. If there is to be any quality in broadcasting, then clearly the broadcaster is answerable for the content. The broadcaster can also be sued for any libel that occurs in a programme.
We are talking about something which could be the same difference, as it were. The theory in broadcasting before 1990 was that none of us was allowed to broadcast a programme suggested by an advertiser. Let us all admit that that was probably honoured in the breach in that it was very simple to say, "We are doing such and such a programme" or for an advertiser to mention, "If you were to do such and such a programme, we would certainly support it or sponsor it." Nevertheless it is an important distinction that the broadcaster must remain in charge of the programme and its editorial content.
There is another issue involved, however, which, in its own way, is rather more important. I refer to the whole basis on which we regulate broadcasting. I have sympathy with one part of what the noble Viscount said but I am slightly worried about the other. I shall deal with the bit that I am worried about first.

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I do not believe that there will be an explosion of channels on digital—or there will be, but they will last about 18 months. Half the cable channels at the moment are losing money; most are hanging in there hoping that they will survive longer than their neighbours and therefore benefit from a smaller market.
It is important that we do not allow ourselves to be dictated to by the technological imperative and end up, if we stand the old adage on its head, in a position where invention becomes the mother of necessity and, just because there is the capacity for more channels, we feel that there must be more channels. There can only be more channels worth watching if they have the necessary resources, both creative and financial. The fact that digital broadcasting makes more frequencies available does not reduce the cost of making good programmes. If many cable channels are failing at the moment, they are not suddenly going to become wealthy enough to make even more programmes and produce even more channels. We need to be careful about that.
I join the noble Viscount in asking the noble Baroness gently to nudge the Government in the direction of drawing the ITC's attention to the fact that there are anomalies.
I hope people will not think that I have gone native after only two months in this place if I express nostalgia for things. It is a nostalgia I have felt for a long time. Prior to 1990 all broadcasting in this country operated under the same public service rules. They were enshrined in the BBC's Royal Charter and, in the case of the independent broadcasting sector, in an Act of Parliament, if anything even more tightly drawn.
Six out of seven of the public service obligations were repeated in the 1990 Act and apply to cable and satellite as well. It is important that public service does still apply to them. The notable exception is the famous "inform, educate and entertain" which, instead of being a universal obligation, is now enforced with varying degrees of rigour by the ITC through individual licences with terrestrial broadcasters, Channel 3, Channel 4, satellite and cable. There is even a disparity of treatment between Channel 3 and Channel 4, let alone between terrestrial broadcasters and satellite and cable.
A viewer sits watching a television set. Whether it is delivered by satellite, cable or terrestrial broadcasting is immaterial to him. If we are to have a level playing field and fair competition between them, we should have the same rules. I tend to agree with the noble Viscount that if masthead programming were to be a good thing, we should all be allowed to do it. If, on the other hand, it is a bad thing, then nobody should be allowed to do it. It is patronising and disparaging of the ITC to say, "We are a bit worried about this, but not many people watch cable and satellite so we will try it out on that." It is like decriminalising cannabis for redheads to see if it works and what effect it has.
I believe that there is a case for creating a level playing field. To that extent, I join the noble Viscount in suggesting that the ITC may feel that the year is up and that it is time to bring everyone into line, wherever that line is drawn. For my part, I do not care whether
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they are all allowed to do masthead programming or none is allowed to do so, but there should not be one law for cable and satellite and another for terrestrial.
10 p.m.
Baroness Wharton: My Lords, I thank the noble Viscount, Lord Astor, for introducing this debate this evening. Over the weekend, reading a critique of the new James Bond film, I was struck by the reference to various brand names of the equipment seen on the screen, down to a Brioni suit, an Omega watch, a BMW motorbike and so on. Of course, that is all very European for our rather special British secret agent.
It is commonly believed that product placement provided part of the funding for "Tomorrow Never Dies" and we, the viewers, cannot help but notice all that advertising which is now on the screen. But I was not aware of it in past films. That may be because it was not very noticeable. I guess that it is a sign of the times, because the costs of TV drama and film are spiralling upwards with no sign of stopping. Therefore, it is not surprising that sponsors are now able to place their products on screen in addition to being included prominently in screen credits. I suppose that is fair enough.
I mention that only because it has a bearing on this evening's debate. Clearly there is a case to be argued for and against the expansion of masthead programming on free-to-air Channels 3, 4 and 5. The ITC first published its code on programme sponsorship in 1991, and a revised code was published earlier this year. Next spring will see another reassessment. Therefore, nothing is set in concrete. Reading the original code on programme sponsorship and now the reasons behind the latest review, I sense a move towards a relaxing of certain rules because the ITC accepts that the context has changed sufficiently to justify continuing a review of its position with regard to this form of programming. Will the 1989 EU "Television without Frontiers" directive on sponsorship have to be updated in order to take account of the new sources of funding that masthead programming offers?
The BBC, as we know, operates on guidelines which are somewhat different from those of the ITC in that they are only guidelines and not statutory. Being a publisher in its own right, there is a natural cross-over for specific programmes. I understood that both "Gardeners' World" and "Top Gear" were television programmes before being published in magazine form. I stand to be corrected on that by the noble Viscount. I have not seen any masthead programming involving an independent magazine title. One could argue that, ultimately, the BBC might be accused by the viewer of reaping rich rewards from advertising through the back door. In that case why are we paying it increased licence fees? At the moment, we all own a television and so are obliged to pay whether or not we watch BBC programmes.
I have sympathy with both sides of the argument because all three commercial channels have public service obligations which are enshrined in the Broadcasting Act. Air time, particularly in the case of

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Channel 3, is somewhat limited because several ITV companies are involved. Channel 4 was set up originally to devote a fair proportion of its programming to minority interests. Channel 5 is getting over teething problems and is still relatively new. Therefore, we shall have to see what happens in the future.
Digital terrestrial broadcasting is around the corner and, in view of the growth in cable and digital satellite stations, many more channels will have to compete for currently available and new material. Advertising revenue in itself cannot possibly hope to fund what the viewers want to see. I for one do not wish to see endless repeats.
Up until now, we have every reason to be proud of our high quality television. Other countries recognise that and we must not lose the advantage which we already have. Where do we draw the line in preventing the sponsor influencing the programme content in a way that might conflict with the broadcaster? Commercial TV is committed to showing a variety of programmes, as they are not themed channels. ITC licensing requirements insist on maintaining diversity. That must be right but, as I said before, the subject is under constant review. In the end market forces will prevail and there will be a compromise between both sides regarding masthead programming, but I, for one, hope that we proceed with caution and do not rush into it.
10.5 p.m.
Lord Newby: My Lords, we wish to support the noble Viscount, Lord Astor, in raising this issue, principally on three grounds. The first is the straightforward one of equity. As we have heard, the BBC has already allowed masthead broadcasting; satellite and cable channels have allowed masthead broadcasting; and given the increasingly competitive nature of the television network, I take the point made by the noble Lord, Lord Gordon, about the extent to which the digital channels may or may not proliferate in the longer run. It seems to us that to deny terrestrial TV the opportunity to schedule masthead programmes is to put it at a disadvantage which simply is not justified.
Secondly, looking at the question of diversity, creativity and quality, I was particularly interested to read in today's Financial Times a survey that Cable and Wireless has done of what its consumers want from their television programmes. An overwhelming majority said that they wanted better programming rather than more channels. It is hardly surprising, given the quality of many programmes already on television, that this should be the case. However, given that it is the case, there should be a prejudice on the part of all of us to support moves which will lead to better programming.
The question therefore is whether allowing TV programmes to be based on magazine titles will lead to better programmes. On balance we think that that is likely to be the case. The kind of magazine which is likely to become involved in making programmes is almost certainly operating in a highly competitive sector. It will almost certainly have a powerful brand already and will be concerned about maintaining the strength of that brand in the marketplace. It is, therefore,
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likely to want to make good quality programmes. As the BBC experience has already shown, the content of such programmes could be argued to strengthen rather than to dilute the public service ethos of the channel. The proposed change should lead to an increase in the production of UK programmes, or programmes in the UK, which we believe is to be welcomed.
I also share the hope of the noble Viscount, Lord Astor, that masthead programming could strengthen regional broadcasting—a matter which all of us, whichever region we are in, are always keen on.
My final argument for supporting the subject of the debate relates to the situation with ITC and the timetable for considering the issue. ITC has the difficult job of regulating an industry which is moving at breakneck speed. Whether you agree with the speed or direction it is going or not, there is no doubt that every day there are major changes in the technology, the regulatory framework and the international situation in which the industry is operating. While ITC has to move in a deliberative way, it also has to move with due pace, and in this whole area it has sometimes taken deliberation to an almost extreme level.
We understand the need to avoid taking steps which could reduce either the quality or diversity of programming. But, as I said, the balance of probability is that allowing masthead broadcasting on terrestrial television would enhance rather than reduce quality and diversity. We would therefore urge ITC to move on this issue without delay. It is for those three reasons that we strongly support the thrust of the Question of the noble Viscount, Lord Astor.
10.10 p.m.
Baroness Ramsay of Cartvale: My Lords, I, too, am grateful to the noble Viscount for raising in this House an interesting Question in which many complex issues of concern about broadcasting are involved. That has been shown in the valuable contributions to this rather short debate.
I shall endeavour to satisfy as many of the points that were raised as I can. I thank the noble Viscount for his courtesy in giving me notice of his main questions. Before I begin my general replies, I welcome the contribution of the noble Lord, Lord Gordon of Strathblane, who speaks not, as he modestly said, from short experience but from rather long professional experience in the field of broadcasting. He mentioned some interesting issues of principle and outlined the problems of achieving some kind of level playing field among the various contending interests.
I am also grateful for the contribution of the noble Baroness, Lady Wharton. In answer to a direct question which she addressed to me, I do not believe that the ITC will need to amend its code on advertising sponsorship to take account of the EC television without frontiers directive. I do not think that is necessary. However, I stand to be corrected on that and I shall write to her if that is not the case. I also agree with her that nothing is set in concrete. She pointed out that last spring it was decided that the review would take one year; in other words, the review will be completed this spring. I do

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not think it is reasonable to demand an outcome of that review a month or two earlier than that. The noble Baroness is right in that programmes must come first and that we should all exercise caution before we rush into this particular minefield.
I am also grateful to the noble Lord, Lord Newby, for his contribution. He made the important point that what consumers want is quality and not quantity. I am not quite so sure that I go along with his case for "masthead programming" as being quite so clear cut in terms of improving quality. However, it is important to bear in mind that it is quality not quantity that viewers and listeners want.
The Independent Television Commission is responsible for regulating commercial television. It is its decision as to whether "masthead programming" should be allowed, and not the Government's. Nevertheless I am sure that the ITC will take due account of what has been said tonight in your Lordships' House. I do not think that I need—in the words of the noble Lord, Lord Gordon—to nudge it to do so. I am sure that the ITC will watch and will read what has been said here tonight.
The ITC published a revised Code of Programme Sponsorship this spring. Paragraph 10.6 of that code deals with "masthead programming", which it defines as programming made or funded by periodical, newspaper or informational software publishers which incorporates the name of the publisher's product in its title and which has editorial content similar to that of the publisher's product. Such programming is not allowed on the terrestrial television channels; namely, Channels 3, 4 and 5.
However, as a result of the revised code, "masthead programming" is permitted on cable and satellite channels. In announcing the revised code, the ITC said it would review the arrangements for such programming after one year—that will be done this spring—taking into account any issues which emerge in connection with "masthead programmes" which are broadcast on satellite and cable. Although the ITC has not used the phrase, it seems to me that in some ways this is a kind of pilot scheme. I understand that since the new code was introduced, BSkyB has launched programmes based on Good Housekeeping and Zest magazines and Carlton Select has launched one related to Ideal Home magazine. UKTV, a joint venture between Flextech and the BBC, also carries a preview programme called Radio Times on one of its cable channels.
I should, however, like to clarify the precise nature of the restriction on masthead programming, and in particular deal with the perceived disparity between the arrangements applying to BBC public service channels and those applying to Channels 3, 4 and 5. Under its Charter and Licence Agreement the BBC is not permitted to take advertising or accept programme sponsorship for its public service channels without the express permission of the Secretary of State. The BBC could not, therefore, base its public service programmes on an existing publisher's product, but can, and does, use its resources to launch its own magazine titles to complement its programmes. The BBC therefore
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engages in masthead publishing, using programmes to promote magazines, as opposed to masthead programming.
The BBC has been very successful in this area, enabling it to become the UK's third largest periodicals publisher, with a turnover in excess of £100 million per annum. This provides a valuable source of additional income to supplement the licence fee. Like other BBC commercial ventures, publication of magazines is subject to the BBC's fair trading commitment, which places a duty on it to compete fairly and openly in commercial markets, at no risk to the licence-payer. BBC magazines are not therefore subsidised by the licence fee.
Additionally, the BBC has given undertakings to the Office of Fair Trading concerning the on-air promotion of its publications to ensure fair trade. The BBC, like all other broadcasters, is subject to both domestic and European competition law and the Office of Fair Trading can intervene if it feels that the BBC is abusing its position. The BBC will also be subject to the prohibitions on anti-competitive behaviour and abuse of dominant position in the new Competition Bill.
Channels 3, 4 and 5 similarly could launch magazines, and indeed other products, to complement their programmes. I believe that fans of Channel 4's popular programme, "Brookside", can now purchase Brookside Magazine. There is no doubt considerable potential for licensees to emulate the success of the BBC in launching programme-related magazines, whether in their own right or in conjunction with existing periodicals publishers.
Where a commercial licensee seeks to promote a magazine or other publication based on its programmes, it is subject to restrictions in the ITC programme code. Paragraph 10.3 of that code states that the licensee must retain responsibility for the content of any material promoted. Promotions must be clearly distinguishable from commercial advertising and must not be included within a programme itself. Announcements about programme-related publications must be brief, and confined to the name of the publication, the price and details of its availability. Such announcements are in turn subject to the ITC's general rules in its Code of Advertising Standards and Practice. Those restrictions apply equally to the new category of masthead programming allowed on cable and satellite programmes.
The purpose behind the ITC's rules in this area is to provide protection for the consumer. Television is a uniquely powerful medium, and UK free-to-air terrestrial channels enjoy substantial audiences. Because of television's ability to influence opinion and engender debate, it is subject to a number of content regulations, including a requirement to be impartial. Hitherto, the ITC has ensured that programmes and advertising must be clearly separated and the content of programmes should not be influenced by an advertiser or programme sponsor. In permitting masthead programming on cable and satellite channels, the ITC recognised that the resources and editorial expertise which publishers could

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potentially offer to television are considerable and could enhance the choice and quality of programmes available to the viewer—a point made by the noble Viscount.
However, masthead programming is likely to have a strong and direct promotional effect on sales of parent publications, which is not consistent with rules applying to other sponsors or advertiser suppliers. Furthermore, titles which could benefit from masthead programming are not subject to the same rules as to content and impartiality as any programmes which might bear their name, and clearly there is a greater risk that the editorial independence of such programmes might be compromised.
While some 75 per cent. of homes still have access only to terrestrial channels, and those channels still command large audiences, it is understandable if the ITC proceeds cautiously on allowing masthead programming on Channels 3, 4 and 5. Developments in the media, including multi-channel terrestrial television and convergence between traditionally distinct areas such as publishing and broadcasting, will need to be reflected in rules on advertising and programme sponsorship as the market matures. For the time being, consumers make a clear distinction between broadcasting and publishing and I believe the current rules reflect the realities of the media market as it stands at present. As I have already indicated, the ITC will review the current arrangements for masthead programming next spring. Its task is to ensure that the regulatory framework remains up to date.
The BBC's public service channels do not enjoy an advantage over their commercial rivals in being able to provide masthead programming. Only cable and satellite channels can offer such programmes at present. As I
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said, the ITC will be reviewing this position in spring next year. As to masthead publishing, I believe that the BBC's fair trading commitment and its undertaking to the Office of Fair Trading regarding the on-air promotion of its publications put it on much the same footing as Channels 3, 4 and 5, which may develop programme-related magazines if they wish.
As to the specific question put to me by the noble Viscount, BDB is in the same category as cable and satellite for masthead programming. Under current regulations it will not be allowable on ITV simulcast on digital. But the ITC is reviewing the code next spring and that will be part of the review, as I understand it.
While I understand that periodical publishers believe it is unfair that the BBC has been able to become a major publisher while they are prevented from developing their magazines as television programmes, it is open to publishers to collaborate with broadcasters in the provision of programme-related magazines, subject to the rules set down by the ITC.
I hope my statement has clarified the position on masthead programming.
Baroness Farrington of Ribbleton: My Lords, prior to moving that the House do now adjourn, I would have wished to raise a comment about the temperature in the Chamber. However, I appreciate that if I were to go through the various draught ingresses into the Chamber, the maximum time I could take to do it would he five minutes. Therefore, I beg to move that the House do now adjourn.
Moved accordingly, and, on Question, Motion agreed to.
House adjourned at twenty-three minutes past ten o'clock.