Lords Sitting of 9 December 1998

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Birmingham.

The Channel Islands and the European Union
Lord Waddington Lord Waddington asked Her Majesty's Government:
What steps they intend to take to resist attempts by the European Union to become involved in the affairs of the Channel Islands and levels of taxation pertaining there.
The Minister of State, Home Office (Lord Williams of Mostyn): My Lords, the Channel Islands are not subject to European Union instruments on taxation. But the Government strongly support European Union, Organisation of Economic Co-operation and Development and Group of 7 initiatives to counter harmful tax competition, avoidance and evasion wherever they exist. Therefore, the Government are encouraging the Channel Islands and the Isle of Man to co-operate with those initiatives.
Lord Waddington: My Lords, I thank the Minister for that reply. However, does he agree that, while every country, every jurisdiction, should, like the Crown dependencies, co-operate in the fight against money laundering and international crime generally, there would be grave dangers in our accepting the right of the European Union—or, indeed, the OECD—to demand changes in the tax arrangements of the dependent territories and the Crown dependencies merely because those arrangements were considered to amount to harmful tax competition in the sense that they deprived other countries of revenue? Is there not a real danger of the European Union picking on the allegedly harmful tax competition provided by the Crown dependencies, and then, having persuaded us to accept that case, using exactly the same arguments against Britain as part of its campaign for harmonisation of taxes generally, and business taxes in particular?
Lord Williams of Mostyn: My Lords, the recent report from Andrew Edwards made it quite plain that the island authorities had made it clear that they want to take a constructive part in international discussions about harmful tax competition. I can say specifically—and this may be of assistance—that we insisted that the principles of the EU Code of Conduct on Business Taxation and the proposed directive on taxation and savings should be,
"within the framework of the constitutional arrangements",
between the United Kingdom and the Channel Islands.
Lord Shore of Stepney: My Lords, the House will certainly recognise that the question of harmonisation of
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taxation within the European Union is very sensitive. However, can my noble friend confirm that the study of the Channel Islands tax practices is part of that vast review of alleged harmful tax competition which is now going on under the chairmanship of a junior Treasury Minister, Mrs. Dawn Primarolo? Can my noble friend also confirm that among the "harmful practices" already identified are those helpful measures introduced only last year by my right honourable friend the Chancellor of the Exchequer to assist the film industry, together with other measures in the past that helped to establish the enterprise zones within the UK as major areas for development? Can my noble friend further confirm that the banning of those valuable tax concessions will not be subject to a veto?
Lord Williams of Mostyn: My Lords, this is a very sensitive area. Indeed, I expect that is why I was asked to deal with it. There is no conspiracy involved. I am repeating now, for the third time at least, the fact that the review which was carried out by Andrew Edwards was not a review of tax practices; it was to do with financial regulation in the Crown dependencies of the Channel Islands and the Isle of Man.
I repeat what I said on the last occasion. The Treasury is always alert to questions of harmful tax competition, unlawful tax havens and the like. That is part of the normal duty of any prudent Chancellor of the Exchequer. However, as I said, there is no conspiracy; nothing is being hidden. As my noble friend Lord McIntosh of Haringey said at least half a dozen times when the same questions were put to him a few days ago, we shall, where appropriate, put United Kingdom interests first.
Lord Hylton: My Lords, does not this question reveal a far wider problem; namely, that of speculative and hot money, usually residing in offshore tax havens, which is totally out of control in the world system?
Lord Williams of Mostyn: My Lords, that was one of the reasons for having the Edwards review of financial regulation. He said—and I paraphrase now rather than quote—that the Channel Islands and the Isle of Man were in the top league of offshore financial centres. But plainly the islands themselves assert, maintain and believe that they do not want unlawful, illegitimate money going through their financial centres. They have promised to co-operate with Her Majesty's Government in tightening up their internal regulation. I am chairing the committee and the first meeting of this co-operative committee will take place on 21st January of next year.
Lord Higgins: My Lords, a radio programme today suggested that the Government have issued a statement regarding tax harmonisation. Given its importance, can the Minister say whether included in that statement is a reaffirmation of the position that he has described as regards the Channel Islands?
Lord Williams of Mostyn: My Lords, I do not think any statement made on the radio this morning needs to

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reaffirm what I have said so often. The constitutional arrangements between Her Majesty's Government and the Channel Islands are plain: we have a power of last resort to interfere with their domestic matters, which includes taxation. It would be unprecedented for Her Majesty's Government to interfere with their domestic legislation, which includes taxation. I cannot make the position any clearer than that.
Lord Tebbit: My Lords, the noble Lord, Lord Williams of Mostyn, referred to harmful tax competition. But, as tax competition normally drives taxes down, how can that be harmful?
Lord Williams of Mostyn: My Lords, if one jurisdiction has tax arrangements which disadvantage its competitor nations, it is quite capable of being harmful. Not all tax competition drives taxes down. I think that the noble Lord will remember that very often taxes are reduced on the basis of political philosophy. I think he will recall that within his own experience. If your Lordships wanted me to—I imagine you would not—I could give the whole of the definition of harmful tax competition, which runs to about half a page. But not today, I hear.
Lord St. John of Bletso: My Lords, in accepting that taxation matters form no link between the European Union and the dependent territories, is it not the case that the Edwards Report demonstrates clearly that the Channel Islands and the Isle of Man are implementing strict financial controls which are internationally recognised?
Lord Williams of Mostyn: My Lords, the Channel Islands and the Isle of Man have stricter controls than many of their overseas dependent territory competitors. They recognise that one has to be constantly alert because the minds of the accountants know no limits as regards ingenuity. One has obviously to be prudent, careful and up to date in dealing with potential abuse.

Motability
2.45 p.m.
Lord Morris of Manchester Lord Morris of Manchester asked Her Majesty's Government:
What assessment they have made of the Motability scheme's contribution to improving the mobility of disabled people.
The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham): My Lords, the Motability scheme has turned around the lives of many thousands of disabled people by giving them mobility with a car of their own. I thank my noble friend Lord Morris, who did so much to establish the Motability scheme under the auspices of our then Prime Minister, my noble friend Lord Callaghan. We also owe a debt of gratitude to the noble
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Lord, Lord Sterling, who has been so committed to the scheme. Today the Motability scheme celebrates its 21st anniversary. It has come of age.
Lord Morris of Manchester: My Lords, my noble friend will know that replacing the invalid tricycle with the mobility allowance and Motability was one of my sterner tests as the first Minister for Disabled People. Is she aware that Motability has now issued its millionth car? And would she agree that, as we celebrate its 21st birthday today, we should honour the memory of the late Lord Goodman, its founder chairman; warmly acknowledge the immense contribution of the noble Lord, Lord Sterling, to this uniquely British and hugely successful partnership between the public and private sectors; and also pay tribute to people like George Wilson and Peter Large of the voluntary sector, without whose help Motability could never have been created?
Baroness Hollis of Heigham: Yes, my Lords. I would certainly like to join my noble friend in expressing my thanks to those who were so important in the foundation of Motability. As my noble friend has said, something like 360,000 cars are now on the road. Motability is the largest leasing scheme by far in Europe and takes up something like 6 per cent. of all new cars in the UK market. If the House will indulge me, I will quote from David of Cardiff, who suffered a prolapse of part of his spine and therefore could not work. He acquired a specially adapted Ford car through Motability and, as a result, was able to get and hold down a job. He wrote to us saying:
"Going to work means social integration, the discipline of getting up and something to get up for, a reason to feel good at the end of the day … There is no reason why a disabled person cannot hold their head up in the world of work side by side with an able bodied person".
That was made possible for him by a Motability car.
Lord Campbell of Croy: My Lords, is the noble Baroness aware of the valuable role that the Motability scheme plays in enabling severely disabled people to travel to and from work, and that, for them, having a job may well depend upon having such transport arrangements?
Baroness Hollis of Heigham: My Lords, I am delighted that the noble Lord so agrees with my previous answer.
Lord Ashley of Stoke: My Lords, anything that my noble friend can do to help disabled people with cars will be greatly appreciated. But, for those without cars who rely upon public transport, can my noble friend tell us what discussions the Government have had with the bus and rail companies with a view to making their services accessible to disabled people? If there were any discussions and such discussions were fruitless, will the Government consider applying pressure on these organisations?
Baroness Hollis of Heigham: My Lords, the Government have good news on this front. It is more a matter for the Department of the Environment,

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Transport and the Regions but, as I understand it, all new trains due to be brought into use from 1st January 1999—that is in a month's time—will be appropriately adapted so that all disabled people can have access to them. New buses, starting with the large single-decker buses, will be appropriately adapted from the year 2000. I understand that new taxis will be appropriately adapted, probably from the year 2002. Consultations are ongoing between the Disabled Persons Transport and Access Committee and the manufacturers and operators. Clearly it may take up to 15 years before the existing stock has been fully replaced with the new vehicles, but the progress, with consent, I think is very good news.
Baroness Masham of Ilton: My Lords, with the new idea of stopping private cars coming into city centres and allowing in only public transport, will special consideration be given to disabled people to allow them to bring in their adapted cars? Otherwise, they will be at a loss.
Baroness Hollis of Heigham: My Lords, it is customary that where, for example, only public transport and taxis are permitted on streets people with, if not orange, then at least green disability badges are also permitted. However, I shall write to the noble Baroness and try to give her the assurance that she seeks.
The Earl of Lauderdale: My Lords, can the noble Baroness tell the House whether the scheme applies to those who are temporarily disabled?
Baroness Hollis of Heigham: My Lords, Motability cars are available primarily for those who have a long-term impairment and are therefore eligible for the mobility higher allowance. One of the good pieces of news which I am sure your Lordships will welcome is that in the proposed welfare reform Bill we will extend mobility payments to children aged three and four so that when those children who have heavy equipment, like polio equipment and so on, need access, their parents will he able to join the Motability scheme. But Motability is designed essentially for people who have long-term mobility problems.
Lord Sterling of Plaistow: My Lords, perhaps I may take this opportunity to thank everyone for their kind words. There are many people present who have been involved. The scheme started under the government of the noble Lord, Lord Callaghan. A very key person—a splendid man—was the late Lord Ennals. The noble Lord, Lord Jenkin of Roding, the noble Baroness, Lady Hollis of Heigham, in her former role, the noble Lord, Lord Newton of Braintree, and of course the noble Baroness, Lady Masham of Ilton, have all played a role. As the late Lord Goodman himself said—
Noble Lords: Question!
Lord Sterling of Plaistow: My Lords, does the Minister agree that it is the unsung heroes, thousands of them over the years, who help the disabled when their
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cars break down and help them in their travels, who deserve credit? A family revolves round a disabled person and helps to give them a new future.
Baroness Hollis of Heigham: My Lords, I very much welcome the contribution of the noble Lord, Lord Sterling. It is certainly true that when one has a disabled person one very often has a disabled family. The disability is borne by all members of the family, as many noble Lords will know. The mobility scheme, extended with the introduction of DLA in 1992, and Motability cars have given disabled people independence so that they are no longer continually dependent on being looked after by members of their family, however generously and gracefully that service has been offered. It has been a major transformation for disabled people to have the independence that most of us here today take for granted.

New Deal for the Young Unemployed
2.52 p.m.
Lord Dormand of Easington Lord Dormand of Easington asked Her Majesty's Government:
Whether they are satisfied with the progress being made in implementing the New Deal for the young unemployed.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, the New Deal for young unemployed people is making encouraging progress. More than 185,000 young people have started the programme. This includes the whole stock of young people who had been unemployed for more than six months when the New Deal was launched nationally in April. Young people have welcomed the advice, guidance and support offered by New Deal personal advisers. More than 38,000 young people had been helped into jobs by the end of October. A further 31,000 were benefiting from training and work experience. Nearly 33,000 employers have signed up to the New Deal.
Lord Dormand of Easington: My Lords, is my noble friend aware that the success of the New Deal over the past 18 months which she has just very properly enunciated is to be not only warmly welcomed but further developed? Can she say what percentage of the companies that have signed up to the scheme have recruited young people? Secondly, what is the percentage of participants who have dropped out, having exercised an option?
Baroness Blackstone: My Lords, I cannot answer my noble friend's first question but I shall certainly write to him. I am grateful to him for welcoming the programme. It is a very important scheme in terms of supporting unemployed young people, getting them back into jobs and providing them with further education and training. There are drop-out rates from the New Deal. Again, I shall have to give my noble friend the precise statistics by writing to him. The Government are monitoring

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those drop-out rates. We are not always told the reasons when a young person decides to leave the scheme, but we assume that in most cases it is because the young person has either gone into full-time education and training outside the New Deal or that he or she has got a job. But of course it could be that the young person has married a millionaire.
Lord Higgins: My Lords, what percentage of those invited to interview under the New Deal scheme have failed to turn up and what sanctions do the Government impose on those who do not appear?
Baroness Blackstone: My Lords, when a young person does not turn up for a New Deal interview, he or she is re-invited and given a second chance. The sanctions for refusing to participate in the New Deal when a young person has been unemployed for six months is that they lose their benefit. However, I shall have to write to the noble Lord with the precise percentage.
Lord Mason of Barnsley: My Lords, is my noble friend aware that the option for self-employment is now an extra dimension within the New Deal and that that aspect of its activities is linked to the Prince's Youth Business Trust, of which I am chairman in South Yorkshire? Applications are now starting to come through, enabling the Prince's Youth Business Trust to take more people off the dole and launch them into their new businesses. Can she expand a little on that activity within the New Deal?
Baroness Blackstone: My Lords, the Government are enormously grateful to the Prince's Youth Business Trust for its involvement in the New Deal. We are all very much aware of the work that my noble friend has put in. The New Deal for young unemployed people, and indeed those over 25, is fully operational in Barnsley and the South Yorkshire area. The Government want to hear more about particular good practice in relation to the self-employed and would want to disseminate information that can be provided about what is happening in South Yorkshire, and in Barnsley in particular, in respect of the self-employed.
Lord Tope: My Lords, can the Minister tell us the average cost of the three main options other than subsidised employment? Is she aware that on 18th May one of my honourable friends in another place was told that the average cost was about £4,000 and that on 17th November my honourable friend Don Foster was told that it was £2,600? Can she explain this apparent 35 per cent. cut?
Baroness Blackstone: My Lords, the latest figure I have been given is rather different from either of those given by the noble Lord. Contrary to the rather, if I may say so, cynical fabrication and distortion in the CPS pamphlet, where the costs quoted were very far from
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reality, the true cost of the 30,000 jobs that have been secured with the help of the New Deal by the end of September was about £1,000 per job.
Lord Rowallan: My Lords, I welcome the number of people taken off the street by the New Deal, but is the Minister aware that, in yesterday's Daily Mail, Harry Fletcher, Assistant General Secretary of the National Association of Probation Officers, informed us that paedophiles are getting jobs working with children through the New Deal despite the fact that the staff of the New Deal knew of that? Will she assure the House that action will be taken to stop this happening again?
Baroness Blackstone: My Lords, I am aware of the press coverage in yesterday's newspapers of concerns about former sex offenders obtaining jobs through the New Deal. The Employment Service is doing all it can to play its part in preventing unsuitable people obtaining jobs with young people. It would never knowingly submit a serious sex offender for a job working with young children. The Employment Service requires employers, when signing up to the New Deal, to sign a declaration form confirming that they will carry out all the necessary checks with the police and others if the job includes unsupervised contact with children. The primary responsibility for checking on the suitability of people must rest with employers.
Lord Dormand of Easington: My Lords, is my noble friend aware that the British chambers of commerce have complained about the lack of communication with the Employment Service? That is a serious accusation. Do the Government accept that criticism?
Baroness Blackstone: No, my Lords. The Employment Service is working closely with all employers and employers' organisations in the delivery of the New Deal. The fact that more than 30,000 employers have signed up to take part in it is a manifestation of the success of the Government, and of the Employment Service in particular, in making good contacts with those in the private and the public sectors who may be able to offer young people such opportunities.

Medicines Control Agency
3 p.m.
Earl Baldwin of Bewdley Earl Baldwin of Bewdley asked Her Majesty's Government:
Whether they are satisfied with the proposed new arrangements under which the Medicines Control Agency will decide whether a product is a medicine or not.
The Parliamentary Under-Secretary of State, Department of Health (Baroness Hayman): My Lords, the Medicines Control Agency is consulting on its proposals to introduce a statutory process for classifying products as medicines. Following

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consideration of the comments received, Ministers will consider whether and what legislative proposals will be put before Parliament.
Earl Baldwin of Bewdley: My Lords, I am grateful to the noble Baroness for that reply and the proposal for a statutory basis is certainly welcome. Is she aware, however, that there have been recent concerns about the MCA moving the goal posts in this contentious area and that the new proposal provides, and I quote,
"that, in any legal proceedings, a final decision"—
that is, by the MCA—
"at the end of the process that a product was a medicinal product would he sufficient evidence that it was a medicinal product"?
In other words, even in a court of law the agency is to be prosecutor, judge and jury in the very area that has been causing concern. Surely that cannot be right.
Baroness Hayman: My Lords, we are in the process of consulting on the proposals. We are very willing to listen to representations. I am grateful for the noble Earl's welcome and for his request for some clarification of the process in this complex area of the law. Perhaps I may reassure him that we are not in any way moving the goal posts or changing legal definitions. We are trying to ensure that there is an opportunity for manufacturers in particular to challenge judgments about whether something is or is not, under the law, a medicinal product. On the point about the decision being final in court, nothing that is proposed will in any way take away from manufacturers the possibility of contesting classification in either the civil or criminal courts or, indeed, of seeking a judicial review of the MCA's decisions.
Lord Clement-Jones: My Lords, will the Minister explain why the period of consultation by the Medicines Control Agency is so short, lasting only from 6th November to 31st December? Will her department consider extending the period of consultation beyond 31st December?
Baroness Hayman: My Lords, I believe that the period is within the generally accepted range for consultation. However, I recognise that it coincides with the Christmas period. Although I would not encourage people to be dilatory in responding, by the same token I would not like to suggest that we would not consider responses received within a reasonable time after the close of the consultation period.
Baroness Gardner of Parkes: My Lords, vitamins which are currently classified as "food supplements" presumably carry no VAT, but if certain items are reclassified as "medicines", will that change their status? Will all items classified as "medicines" require a prescription or will people still be able to buy simple medicines over the counter, as now?
Baroness Hayman: My Lords, it is not intended, under the proposals, to change the status of medicines or their classification which at present is subject to European and UK law. The question of whether a
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medicine is a licensed medicine, an exempt medicine, a food supplement or, indeed, a cosmetic product is complex. It is because there are disputes around such borderline substances that we are trying to put in place a process of classification which is more transparent and which makes it easier for people to challenge the initial decisions of the MCA. I can reassure the noble Baroness that there is no desire to change the classification of food supplements or their status.
The Earl of Clanwilliam: My Lords, there are considerable efforts afoot on the part of Pharma Cartel to pressure the Codex Alimentarius Commission of the United Nations to outlaw information on vitamins and other natural products on the pretext of consumer protection. Is not that a form of censorship? Is the Minister aware that there is a further plan afoot by Pharma Cartel to have vitamins registered as medicines and thereby subjected to product licences and disproportionate costs, thus eliminating them from chemists' shelves?
Baroness Hayman: My Lords, the UK's position has been quite clear: we do not believe that there should be limits on the vitamin and mineral content of supplements on anything other than safety considerations. We should like still to be available as food supplements those products which are classified as safe.
Lord Pearson of Rannoch: My Lords, can the noble Baroness assure the House that the review panels referred to in the MCA's consultation letter of 6th November will, indeed, consist of experts who not only know the products in question well, but who do not represent the huge pharmaceutical interests which bear down upon this issue?
Baroness Hayman: My Lords, I hope that I can reassure the noble Lord. It is considered that the review panel needs to have a majority of expert members who are chosen for their knowledge and experience. As a rule, they will be MCA medical and pharmaceutical assessors. Exceptionally, an external assessor would be enlisted if in-house expertise were not available.

Business of the House: Debates this Day
Lord Williams of Mostyn: My Lords, on behalf of my noble friend the Leader of the House, I beg to move the Motion standing in her name on the Order Paper.
Moved, That the debate on the Motion in the name of the Lord Kimball set down for today shall be limited to three-and-a-half hours and that in the name of the Baroness Cumberlege to two hours.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

Agriculture
3.7 p.m.
Lord Kimball Lord Kimball rose to call attention to the future of the agricultural industry against the background of falls in farm income and in output; and to move for Papers.
The noble Lord said: My Lords, I can still hear the words of that great Master of Trinity College, Cambridge, G. M. Treveleyan, from his English Social History, which he said to me on leaving the college some 50 years ago:
"Beware a town-bred electorate indifferent to the decay of rural life".
Those who no longer have a job in the rural economy do not stand outside the factory gates. They are not there for everybody to see. In the previous agricultural depression, and in the present unhappiness, they move away from the countryside and find work elsewhere, even abroad. However, this time round, there is a new factor which is even more worrying: there appears to be no desire among the children on so many of our small livestock holdings to carry on in the family farm.
The decay of the rural communities can be halted only by hope and enthusiasm for the future. It is not the purpose of this debate to hark backwards, but rather to look at the stark economic factors revealed by the catastrophic drop in farm income of some 33 per cent. in the past year. That figure was published last week.
The extent of the current crisis is well documented. The £120 million aid package announced last week will help some farmers' cash flow, but the industry is not looking for a quick fix. To restore confidence, the industry needs to know the future shape of the common agricultural policy, due to be agreed next year; the outcome of the negotiations of the World Trade Organisation, due to begin in January, and the effect of the further enlargement of the European Union with the first major countries joining in 2003.
I think we also need to reflect most carefully on the effect of the constitutional changes in the United Kingdom with regard to the Welsh, Scottish and Northern Ireland assemblies. Agriculture is a delegated responsibility to each one of these assemblies. We must have a coherent United Kingdom policy with no distortion of competition or preferential treatment with regard to the delegated authorities.
The object must be to ensure that farmers are encouraged to farm productive land to its optimum potential while taking all reasonable measures to protect the rural and social environment. The real problem that faces us today is that of the so aptly named less favoured areas. There is a national desire to maintain a rural infrastructure in the hills. Therefore sheep and beef farming must remain viable. However, under today's circumstances they cannot survive by means of the market alone. The present system of headage payments for mature livestock merely encourages overstocking. Viable numbers of people are needed in the hills—farming, working and living—to maintain the infrastructure. There is merit in considering a "per working person" grant, to include the farmer and his wife and those who run the village shop and post office.
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We have the model in the environmentally sensitive area forms of contract. That is the kind of support on which we shall have to build to maintain these less favoured areas.
It has to be recognised that it is impossible to draw a definite line between the less favoured areas and the productive lowland. A scheme of halfway support is necessary for these grey areas. As deputy president of the Countryside Alliance, I know that that organisation will be at the forefront of addressing the problems of rural people, particularly in the areas I have just mentioned.
The present uncertainty highlights the contribution that country sports and game rearing make to the agricultural environment. They are an essential part of the rural economy. The annual direct expenditure on country sports in any one year now exceeds £3.8 billion flowing into the rural economy. Fox-hunting alone delivers 15,895 full-time jobs with an expenditure of £243 million, as recorded by the Cobham research consultants. Particularly in the less favoured areas, those who live in the countryside need a diversity of business to cushion them from the present economic shocks. The value of the game market alone has grown from £12 million to some £18 million in the past year. The rural areas now sell £9 million-worth of venison. Alas and alack, the amount of fish that is sold commercially is extremely small, some £650,000-worth. We shall have to tackle that matter at a later stage.
If the remaining productive land is to meet its full potential, we must accept that the current CAP is protectionist. It seeks to preserve an outdated and costly farm structure. We should look carefully at the American example. Their Freedom to Farm Act phases out subsidies and leaves the individual farmer to run his own business. We need the same system here. We need a system that is simpler and less bureaucratic and a system in which modulation has no part to play. All producers should be treated equally without discrimination with regard to size.
Animal welfare considerations should be based solely on the best scientific advice that is available and should not be unilaterally imposed on the industry. The present lurch towards green policies must be curbed and watched. The new consultation process on better protection for SSSIs must not be used to impede economic agricultural development. A flexible funding package must be made available to encourage positive management of SSSIs. The regulatory burden grows. I refer to high vehicle taxation, fuel duties, meat inspection costs and now the danger of a pesticide tax being introduced. Farmers receive too small a proportion of the final selling price of the food they produce. A better return is the key to the success of the industry.
We need to keep as many people farming as possible. Those people should be entitled to a reasonable standard of living. It follows that we need to make British agriculture as profitable as possible. That is why the catastrophic drop in farm income at the beginning of this month is of such concern. I am certain that the revised figures to be issued at the end of January will

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reveal an even greater drop in farm income. We need to put on record what Agenda 2000 should state in March on behalf of the industry. The Government must ensure that negotiations move in the right direction. Adequate funding must be made available for the transitional phase. A new system must be financed fairly within the European Union. It must also incorporate the need to develop non-food production uses of land; diversification is one of the most important elements in the countryside.
This debate is being held 25 years after we joined the European Economic Community. What has happened in the countryside in those 25 years? Dairy cow numbers have fallen by 22 per cent. We now kill one-quarter less of clean sheep. The figure was 20.6 million 25 years ago and it is 16 million now. The figure for beef slaughtering is down by one third from what it used to be. What is worst of all, 15 per cent. of our arable land is now set-aside. All these figures represent lost production and lost profits to the farming community. Today's debate occurs almost a year after the start of the campaign, "Keep Britain Farming". The farmers are not alone in their concern for the future of the countryside. They have the unqualified support of your Lordships' House. I am certain that the debate will show that. I beg to move for Papers.
3.17 p.m.
Lord Davies of Coity: My Lords, I appreciate that there are a large number of noble Lords in this House who know more about the agriculture industry than I do. However, I venture to say that there is no one in this House who is not conscious and indeed concerned about the crisis and the difficulties which face those involved in agriculture in this country today. Some sectors are perhaps more fortunate than others, although I dare say that all sectors face difficulty.
This consciousness, understanding and concern are shared by the Labour Government. That is demonstrated by the efforts they are making to offset as far as possible the difficulties that agriculture faces today. As regards what the Government have to do, and what they are expected to do, I ask noble Lords to consider that this Government have been in office just 18 months, whereas the previous government were in office for 18 years. Certainly the previous government had to face difficulties in agriculture during their time in office.
The Labour Government have not brought about the present difficulties. Mad cow disease, BSE, has been a national disaster. By the year 2001 the United Kingdom will have spent close to £4 billion on measures to combat the disease and to ensure that British beef is among the safest beef in the world to eat. The Labour Government have shown their concern, which has resulted in getting the ban lifted in Europe. Now it is hoped that farmers will be able to increase their sales abroad and perhaps move into a much better position than for some considerable time, certainly a lot longer than the 18 months during which Labour have been in power.
There are numerous reasons for the difficulties that are now faced by the agricultural industry. The matter of beef has been widely canvassed in this House, in the
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other place and in the press over many years. There is over-production in pig farming. The collapse in Russia has had an effect. Now we have far too many pigs and prices have dropped. The same is true of sheep. The poultry industry is reasonably stable. Although it has its difficulties, the situation is not as bad as the other areas I have mentioned; nor is the situation as regards milk.
What have the Labour Government done? It should be acknowledged that over 18 months they have done a considerable amount. They have put £150 million into farming over the past 12 months. In addition, there is the further recently announced £120 million for hill farmers. The hill livestock compensatory allowance will account for £60 million; agri-monetary compensation £48.3 million; and the calf processing aid scheme will be extended until the end of the financial year, in March next year. The lifting of the beef ban was a marvellous achievement. For the Government to have succeeded in that took a lot of hard work. We have debated the matter previously.
A matter that causes me some concern is the demand for the ban on beef on the bone to be lifted, despite scientific evidence indicating that consumers will be at risk. It is somewhat irresponsible to call for the lifting of the ban at a time when scientists who are aware of the circumstances are saying that it still presents a danger.
Although farming is recognised as difficult and farmers will be at the sharp end, it is not only farmers who feel the impact of difficulties in the industry. My union represented people in food manufacture in areas where pies, sausages and cooked meats were being produced. All those industries are affected and, consequently, job losses occur. A chain of difficulty arises right across the board. I well remember in the 1980s representing milk workers who were employed in processing plants, milk-bottling, creameries and doorstep delivery (which we do not see too much of today). I remember when a big battle took place over the question of milk imports. We were worried about the health of people in this country. We did not feel that safety standards in milk production in Europe were as good as our own. The unions, in partnership with the Dairy Trades Federation, as it was known at that time, went to visit Commissioners in Europe, who were then my noble friend Lord Richard and the noble Lord, Lord Tugendhat. I received much more sympathy for my plea and that of the industry from my noble friend than I did from the noble Lord—who told me that there was nothing wrong with continental milk; his children were drinking it. That response still rings in my ears. The milk that was coming into this country was not being sold on the doorstep; it was discounted through supermarkets and could be bought at a discounted price. That damaged doorstep deliveries. People consumed much more milk when it was delivered to the door than when they collected it from supermarkets.
As a result, and partly as a consequence of other policies, British milk processors decided that they wished to sell more milk to supermarkets and the doorstep delivery almost disappeared. What then happened was that liquid milk consumption in this country was dramatically reduced. As a result, herds became smaller since there was no longer the same

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demand. Large numbers of people who had delivered milk to British housewives the length and breadth of the country lost their jobs. The milk industry has since recovered slightly.
Another element has caused difficulty in the industry; namely, the break-up of the Milk Marketing Board. I am not saying that the situation should not have been changed—had the change been brought about in a sensible, stable manner. I regret the way in which it was introduced. It was the result of an obsession with deregulation rather than concern about practical transformation. Difficulties now seem to be arising, and the Monopolies and Mergers Commission is examining the question of what is essentially a farmers' co-operative in the dairy industry.
I ask all noble Lords to have some measure of sympathy with what is happening and recognise the Government's attempts to offset those difficulties. I have no time to talk about reform of the CAP, but the Government are certainly tackling the issue. They wish to see the CAP reformed, to the benefit of the British farmer, and will do everything in their power to bring that about.
3.26 p.m.
Lord Beaumont of Whitley: My Lords, we are all grateful to the noble Lord, Lord Kimball, for introducing the debate. I go along with the noble Lord in almost all that he said. I did not necessarily follow him into the deepest recesses of his arguments. I received the slight impression that life would be improved if packs of foxhounds were allowed to roam over SSSIs. The main argument that he makes for the countryside and the strength of the agriculture industry is one that we must all support.
Last week, your Lordships were all enjoying yourselves, so that when I finally surfaced here on Thursday all my friends kept saying to me: "Tell me what has been going on in the House of Lords". I am afraid that I was not able to tell them. Not only was I not privy to the peculiar things that were happening in the Conservative Party, but I was not here. I was attending a conference in Rome—largely due to the generosity of the noble Lord, Lord Mackie, who allowed me to go when he might have gone there himself. I went as one of your Lordships' IPU delegates to a conference of the FAO on the subject of feeding the world in the future in a sustainable way. It was a heartening and interesting experience. When I returned, possibly I had not learnt a great many new things, but what I had learnt in the past had been greatly reinforced together with the feeling I had in my bones, having been brought up in a period when farming in this country was important and those of us who were brought up on farms were doing something really worth while.
All the contributors to the conference were more or less unanimous—with the possible exception of the Americans. There were only two Americans there so far as I could discover. There was an American delegate who was a member of Congress, who attended for half a day, and there was a keynote speaker. The keynote
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speaker was very optimistic. He said that we could feed the world quite easily; there were no problems at all; it was just a question of delivering in the right way. He did not necessarily produce the machinery for doing that, but said there was no problem.
It is true that there is enough food for the world at present, but there are threats to food production all over the world. I strongly believe that at the heart of this debate is not so much what we should be doing in the rural parts of the country but that we should concentrate on the fact that it is up to every country to produce enough food to feed itself as far as it can and not to import more than it has to over large numbers of air-miles, thus depleting the world's resources and causing pollution. Food security is extremely important. I hope that as a result of this debate the Government will take to heart the necessity of understanding this basic truth about food and agriculture and its relationship to the countryside.
There is far too much talk about the necessity to restructure the agricultural industry. What does restructuring suggest to an agricultural community that is already in the depths of crisis? It suggests what the steelworkers, the coal-miners and the shipbuilders all experienced under Thatcherism. It means that this Government's mind-set is to allow a significant proportion of traditional family farming throughout the UK to disappear. If they allow it to go to the wall people will retreat from the land. Family farms will be sold. There will be more amalgamations and more agribusinesses. We shall not have the families there who, for generation on generation, have looked after these areas, be it in Cornwall, Devon, Somerset, the Highlands or rural Wales. If that happens, then the great irony is that the very objectives on which there is all-party consensus in terms of CAP reform—that more funds should go into rural development, diversification, conservation and management of the habitat—will not be met and we shall not be able to develop the post-CAP reform to which the Government pay lip service.
There is a need to concentrate on support for agriculture. If we once manage to get that into our heads, and the Government manage to get it into their hearts and souls, there are some Members of your Lordships' House who sit on the Government Benches who understand all this and whom we can trust entirely. I very much look forward to hearing the noble Lord, Lord Carter, respond to the debate, not just because he will tell us what the Government have to say—which I look forward to hearing with interest but not necessarily a great deal of hope—but because I know that he himself cares passionately for the countryside and knows a great deal about it.
Farmers need to produce food and other products of cultivation, to care for the landscape and its wildlife, to provide a sound economic base and core employment for the rural economy and to form a stable backbone in the rural community. That can in part be done by supporting smallholders and small farmers. At present 80 per cent. of subsidies go to 20 per cent. of farmers. It is not sensible to give very large subsidies to very large farmers. I concede that all farmers need subsidies these days, but they should be tapered according to scale

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of production. Subsidies should be more equitably and usefully distributed among the farming community so that it is not too hard-pressed economically but able to produce good quality food in a civilised way. A much higher proportion of subsidies should be for environmental activities.
If we want healthy, home-grown food, a flourishing rural economy and an attractive landscape, complete with wildlife, family farmers will produce that as long as there is a profit to be made from producing food. They will produce the rural infrastructure which is needed if the countryside is to have services, such as post offices, shops and rural transport. The existence of those services requires that there be a countryside population which is able to afford what is offered and which can go on living in the countryside and that the sons and daughters of that population will go on living there—a point stressed by the noble Lord, Lord Kimball.
It is not any particular reform that is needed, although I have no doubt that my noble friend Lord Mackie and others will talk about reforms. The need is to try to get the Government to understand that agriculture is the heart of the countryside and that we cannot for ever rely on trade from abroad, which may produce food for our people but which at the same time ruins our farming industry and the countryside. If we can instil that feeling in the Government's heart, this debate will have been worthwhile.
3.35 p.m.
Lord Palmer: My Lords, it is perhaps worth pointing out that 11 of the speakers this afternoon are hereditary Peers who care passionately about the countryside and those who live and work in it.
It is exactly three weeks since we last cantered over the problems facing this country's agricultural industry. It was generally agreed in that debate that Britain's farmers are facing the worst crisis in living memory. Some of my neighbours have yet to finish their wheat harvest—and we are now under two inches of snow. That is grim, my Lords, grim. I thank the noble Lord, Lord Kimball, for introducing the debate and I agree with him that it is to the future that we must now look.
I must declare an interest as someone who tries to farm in the Scottish Borders. In the previous debate I made a plea for further investment into research and development for alternative crops, particularly those that can be used for bio-fuels. The noble Lord, Lord Donoughue, told the House that £420,000 was currently being spent on research and development. I am afraid I believe that that sum is ridiculously low, especially as North Sea oil will not last for ever. Many valuable renewable resources can be derived from agricultural crops. Some sectors of the European chemicals and energy industries increasingly rely on vegetable oils, fibres, starch, cellulose and sugars derived from established and novel agricultural crops. Increasing the use of these renewable raw materials will help to reduce the consumption of finite resources of mineral origin and benefit the environment by reducing greenhouse-gas emissions. It will also improve the overall carbon balance.
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It is imperative that non-food crops are available. For this, a framework must be introduced which ensures that non-food crops are a viable option for agricultural businesses, processors and consumers. Until recently the key driver for the growth of non-food crops was set-aside. Over the past 10 years there has been considerable public funding, coupled with private funding, running into millions of ecus, of projects which have improved the economic and environmental performance of non-food crops and their derivatives.
The European Renewable Raw Materials Association estimates that 5 per cent. of arable land in Europe is used for producing crops for industrial markets. Set-aside has not been the only driver which has encouraged the development of non-food crops, but it has certainly boosted the speed with which the sector has developed. However, the CAP reform proposals published by the European Commission ignore this successful development and have cast doubt over the whole future of set-aside. This doubt has been felt throughout the industry as further investment in plant, machinery and multi-annual crops is now very much in question. This suggests that set-aside is an unsatisfactory basis for support as the rate varies annually.
Naturally, this does not inspire confidence, particularly when planting multi-annual crops such as short rotation coppice. Its long term future is indeed uncertain. Agenda 2000 makes no provision whatsoever for the development of non-food crops on land which is not eligible under the arable area payments scheme. Surely this is a terrible oversight. It is vital, therefore, to consider a new support regime to provide long-term, robust measures which could qualify for WTO green-box status.
A new approach to the development of a non-food crops industry is a must, driven by a recognition of the economic, environmental and social benefits of this sector rather than dependence on set-aside production. The development of a robust industry which will deliver high quality and tailor-made raw materials for use by industry and the energy sector will clearly help the European Union to develop in a sustainable way. Non-food crops will make a strong contribution to the objective of sustainable development by creating employment and revenue opportunities in rural locations and providing obvious environmental benefits by reducing greenhouse gas emissions and increasing biodiversity in the rural landscape.
As Agenda 2000 fails to make specific provision for non-food crops it will not be profitable to plant new species for non-food use and biomass crops. If this is the case the European Union's agricultural, chemical and biomass industry will lose the market share that it has built up successfully over the past decade. Considerable investment will be wasted or, worse still, handed to our third world country competitors to capitalise on Europe's short-sightedness. Surely it must be madness.
To ensure that Europe can continue to benefit from the industry that it has developed we need a policy framework specifically designed for industrial and energy crop advancement in the long term which will allow non-food crops to compete with mainstream

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supported crops, provide a level of support that reflects the range of environmental and social benefits associated with non-food crop production, encourage a focused and co-ordinated approach between different departments within the European Commission and, finally, encourage investment and growth and enhance the competitive strength of the European Union in renewable production, research, technology and application.
Last March Commissioner Fischler said that,
"when we talk about agriculture as a supplier of raw materials for industry, particularly for energy production, this means above all an opportunity to replace non-renewable resources with renewable agricultural products".
I believe passionately that he is right. More must be done, and urgently. We surely owe it to future generations, not only of farmers but to future inhabitants of this country and indeed of the European Union as a whole.
3.43 p.m.
Lord Jopling: My Lords, I begin by thanking the noble Lord, Lord Kimball, for introducing this debate in such an admirable way. I declare an interest as a farmer in arable and lowland beef farming in the north of England. I share entirely the concerns that have been expressed in your Lordships' House over the past few weeks about the current plight of agriculture. It is by far the most serious situation that I have ever known in the industry and it affects almost everybody within it. However, I should like to concentrate this afternoon on one group of farmers who cause me especially great anxiety. I refer to the smaller farmers, mostly tenants, who occupy land that is within the less favoured area or others whose land is slightly too good to qualify for assistance under the Hill Livestock Compensatory Allowances. In the north of England we call them "dales farmers". When I use that phrase I intend it to embrace similar farmers in the west of England, Wales and other parts of the country.
Generally speaking, these farmers do not have the buffer enjoyed by owner occupiers; they have rent to pay. Most of them rely on farming for the vast majority of their income. I believe that they are in need of particular help and the sympathy of the Government. I suggest to the Government three matters that I believe deserve their sympathy. First, I should like the Government to have another look at extending the area of land that is covered by the environmentally sensitive area scheme. I have raised this in your Lordships' House previously and I hope that I shall be forgiven for raising it again. I was the instigator of that scheme about 12 years ago. It is tailor-made for those remote dales farmers who now face the greatest difficulty.
The scheme has three great advantages. It is already accepted by Brussels, so there is no need for a lot of new legislation to extend it. It is environmentally sensitive, prohibiting the use of pesticides and chemicals and ensuring that stone walls and barns are maintained. It also ensures that wild flowers in hay meadows can seed before the hay crop is cut. Above all, it does not
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encourage further oversupply and thus add to the surpluses that have bedevilled our agriculture. I hope that the Government will look again at this matter.
Secondly, I hope that the Government will not make matters worse by changing what is already working well. After I left the department in 1987, I spoke in the other place on agriculture very rarely, but on one occasion I seriously questioned the actions of the previous government in scrapping the powers of the Milk Marketing Board. I have a good deal of sympathy with the comments of the noble Lord, Lord Davies of Coity, on this topic. I came of that generation which always saw the Milk Marketing Board as the saviour of the dales milk producers who were being beaten into the ground by the big dairies in the 1930s. The policy of the Milk Marketing Board was to adopt a universal price regardless of transport costs, but that is all behind us. The universal price remains, but the MMB does not. We now have the successor organisation Milk Marque, albeit with less powers than its predecessor, to which the noble Lord, Lord Davies, referred. That, too, is being picked over by the Director-General of Fair Trading. I hope that the Government will not allow further changes to the arrangements for marketing milk that may drive out more and more of the smaller remote milk producers in the dales. They are the first ones to go if the present arrangements for marketing milk are drastically changed.
The third point I raise concerns me very much. I refer to the effect of the Government's proposals to relax milk quotas by 4 per cent. after 2000 and to abolish them by 2006. Noble Lords will recall that when milk quotas were introduced in 1984 there was a huge amount of anguish. At that time, the anguish was directed as much at me as anyone else. Unlike most of my colleagues in Europe, I had the good fortune never to have anything thrown at me. I believe that the German Minister was burnt seven times in effigy! It was an extremely uncomfortable time. But the fact is that milk quotas have been invaluable. First, they have given milk producers a valuable asset. Secondly, by their very nature they have curtailed the creation of more and more unsaleable and unmarketable surpluses. Thirdly, and above all, they have allowed milk producers to get a fair price and therefore have not encouraged a number of highly efficient, large producers to continue to expand and create more and more unsaleable and uneatable surpluses.
I take some pride in the fact that milk quotas have been so successful. In 1984 farmers hated them, but now I believe that they like them very much. Sometimes I wish that they had said so at the time. I am told that as regards our New Zealand arrangements, the United Kingdom is currently 5 per cent. over-supplied with milk. I can only believe that the abolition of milk quotas will again encourage greater and greater surpluses and, most frightening, will put intolerable burdens on the small milk producers on marginal land who, as I have explained, caused me the greatest anxiety. There are bleak times ahead for the small tenants in the dales and on the hills. I hope that the Government will take note of this danger and that they will not make a bad situation infinitely worse.
3.51 p.m.
Lord Inglewood: My Lords, like my noble friend Lord Jopling, I begin by thanking my noble friend Lord Kimball, for introducing this debate and to declare an interest. I am a farmer in Cumbria—although I understand that it is customary to declare an interest where one is making money.
It is agreed throughout the Chamber that in the past 18 months we have seen agriculture in a parlous condition. The reasons for that are varied. I believe that some of the reasons can be laid at the door of the previous government, of which I was proud to be a member; undoubtedly, some of the reasons should be laid at the door of the present Government on the Benches opposite; some of it is to do with the weather, and some is simply "events, dear boy".
Perhaps I may point out two particular matters that bear thinking about. First, the Government's policy about exchanges has had a very damaging impact on agricultural prices. That has come at a time when the other factors—some of which we have heard about already this afternoon—have been militating against farming. The attitude towards exchanges has been driven by the Treasury's wish to save money. I dare say that it may find at the end of the day that, in terms of tax forgone and tax repaid, it may well now be worse off than it would have been had the prices been adjusted. That is of small consolation in rural Britain.
Secondly, it is important that, in the face of the setbacks that British agriculture has experienced, in future we make every effort to regain markets which have been lost. It is always easier to lose markets than it is to get them back. I believe that on my upland farm we have been successful with our cull ewes this year. We sold them for £2.90 each. That was before one deducts auctioneer's commission and transport. That is a measure of the kinds of difficulties that are being faced in the uplands.
In my opening comments I focused on some points of detail and, of course, detail is important. But it is also at least as important, in the context of the world that we are now in, that we also look at the wider picture. After all, what is the point of farming at the end of the 20th century? What is the point of the countryside? I believe that it is necessary to be clear about that because it is only by doing so that we can have a policy framework that will enable us to have the kind of fanning and countryside that we want in the next millennium.
It is quite interesting to turn to Article 39 of the Treaty of Rome, which is the text on which the entire common agriculture policy is written. The common agricultural policy is quite rightly widely derided, but Article 39—I do not propose to bore your Lordships by quoting it—spells out in terms what is the purpose of the policy and why. Against that background it has been an effective basis for a policy albeit one which, in my opinion, is now out of date and, in a number of material respects, misguided.
I am sure that there is agreement throughout the House that in such areas it is not the Government's business to run agriculture in any kind of hands-on manner. But at the same time, because of our history
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and the circumstances of the world in which we live, agricultural policy impacts very heavily on farmers and agricultural practice. I do not believe that that is going to go away, not merely because it is the way in which things are done now, but because the nature of the linkages that exist between the aspirations of all kinds of people and what goes on in the countryside and on farms are such that without some kind of government involvement we shall not achieve the kind of things that I am sure everyone in this Chamber would like to see.
For many years the framework of the politics in which agriculture operates has not been national politics. We have only to go back to the great burning issues associated with the Corn Laws to appreciate that British agriculture cannot be isolated from events outside these islands. That has merely been underscored by our membership of the Community. When one looks at recent developments in the Community and the reform process that is under way of the common agricultural policy, it seems to me that there is a very strong case for saying that the Agenda 2000 initiative and the World Trade Organisation talks are as much symptoms of what is happening in the wider world as being themselves engines for change.
We are living in a world which is changing very fast. It is different from what we have been used to. Society is changing and it is different from what we are used to. Technology is changing and enables things to be done which were completely unthinkable a few years ago. After all, is agriculture any more primarily about food production? I personally believe that it should be. It is particularly regrettable that, for example, certain aspects of the quota system have meant that as regards milk production the capacity for milk processing has had to close because it has not been possible to acquire milk because of the corset put on the milk supply by the existence of quota, in order to produce products for which there was a market in the wider world, but for which the basic raw materials cannot be obtained.
There is general agreement that the environment plays an important part in agricultural policy. But how does one implement that? Should there be cross-compliance? How does one deal with farms which have SSSIs on them? There must be severe restraints put on husbanding that particular land. What about forestry? Those of us who live in the countryside are encouraged, on the one hand, to plant trees and on the other there is enormous opposition at the same time against planting large-scale coniferous forests, which we are told by those who want to buy the timber, is probably the timber for which there is the greatest market and which can underpin the largest number of jobs. I could go on, but I do not see any particular point in adding to these illustrations.
I was extremely pleased to hear my noble friend Lord Jopling comment about the plight facing the small farmer. I would like to add my name to the points that he made. But the crux of much of what is happening in the context of farming at present seems to me to hinge on that and the important point made by my noble friend Lord Kimball about modulation. The inevitable economic response to agricultural policy and prices that we have at the moment is for small farms to be subsumed into large farms. It is an essential part of the

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policy proposed by the Commission that the economic benefits of that, which is the only basis on which such farms can survive, will be eroded by the application of the principles of modulation. It is economic nonsense and it is discriminatory against this country.
When thinking about the remarks that I wished to make today, I suddenly realised that in one sense I might have started in the wrong place. As we all know, most of the population in this country live in towns. They are the taxpayers. Through their taxes they help to support farming in the countryside. In looking forward to the next millennium, and the kind of agriculture that we shall have then, it is important to take into account what those who pay many of the bills of the countryside would like to see.
We must address two important issues. First, what kind of farming industry and countryside do we wish to see in the next century? Secondly, we must concentrate on how we achieve that. Bankrupt farmers, be they owner-occupiers or tenants, cannot deliver. In this country we tend to sneer at poor peasant farmers on the Continent. If the politics of agriculture create a standard of living in the farming community that puts our farmers on a par with them, not merely does it not sound to me to be consistent with general policies enunciated by the Government about the level at which wages should be, it also seems a guarantee that they will not be able to deliver. We must ensure that the farming industry's personnel has a standard of living equitable with that of the rest of society.
4.1 p.m.
Lord Stanley of Alderley: My Lords, I am pleased that my noble friend's Motion draws our attention to the future of the farming industry. There is a tendency—I am guilty of it—to concentrate on the miseries of today. That is helpful only if such examination, like Advent, leads us to look constructively to the future. To that end I have a shopping list of questions that I, as a farmer, wish the Minister to try to answer.
The overriding question is similar to that asked by my noble friends Lord Kimball and Lord Inglewood. What are we, as farmers, trying to achieve? Should we aim to have an efficient farming industry capable of competing in the world market? If, as I hope, the answer is yes, there are a number of problems to be faced. The first is the hardy perennial of a level playing field, which I accept cannot truly ever exist. But when the Americans tried to compete worldwide through "freedom to farm", they had to bale their farmers out to the tune of 8 billion dollars. It poses a problem. I hope that the Minister will agree that that problem is his to solve, not mine as a farmer.
Secondly, the Government must accept that to aim for efficient agriculture is by no means universally accepted. Many people have idyllic ideas of small family farms with buttercups and daisies. I am sorry to have to inform them that such a view cannot lie side by side with an efficient agriculture. I and farmers must adapt for the future. A farm of 1,000 ewes and 100 beef cattle, let us say, is not a large enough unit to survive.
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My answer is somewhat different from that of the noble Lord, Lord Beaumont, but somewhat parallel to the remarks of my noble friend Lord Jopling on marketing. If we co-operate on both selling and working, and accept that such units must be part-time, there is a future. I am much encouraged by the efforts of the noble Lord, Lord Donoughue, in that direction. I hope that he will be more successful than I have been in trying to encourage my neighbours in that direction. Sad to say, I found it very much easier to achieve on the larger farms in Oxfordshire than in the smaller units in Anglesey where the need is far greater. However, putting that into action rests primarily on the farmers and not necessarily the Government.
If we are to have efficient agriculture, the Government must be careful not to make us less competitive by imposing punitive regulations and taxes—for instance, on health and safety, the environment, protection as regards nitrate zones, bird and pest destruction and a possible pesticide tax. That is the quid pro quo of cheap food, which the housewife wants, efficient farming and coming into line with the GATT regulations. However, it is inevitable that if we go down the efficiency path some farmers will never be able to be viable however hard they try.
I would have liked the Tangemann plan, as I know would my noble friend Lord Middleton. But some form of retirement plan is essential. I hope that the Minister—I know that he has thought about such a scheme—will encourage his colleagues to consider it again. I know that the Conservatives disliked it, but, as the noble Lord, Lord Carter, will remember, I did not always agree with everything that my party did on agriculture.
As patron of the Agricultural Secretaries and Administrators I wish to draw to the Minister's attention the difficulty of getting colleges to find sufficient places, mainly because of lack of local authority funding, to train those people despite the fact that the demand for the finished product (if I may call them that) far outweighs the supply. I hope that the Minister will allow me to send him a full brief on the subject.
Finally, I am confident that British farmers will survive the present cut prices. Short-term payouts are not what I really want, happy though I was to receive some as a gesture, as being less favoured. But I am very much aware of the saying that you should live as though you were to die tomorrow and yet farm as though you would live forever. I wish to know—not necessarily for myself but for those who follow after me—where we are going; and that the Government will ensure that the playing field is not made up of totally unnecessarily rutted fields by ignoring the points that I and other noble Lords have raised.
4.7 p.m.
Lord Middleton: My Lords, I, too, am grateful to my noble friend Lord Kimball for initiating the debate and for his thoughtful speech. I declare an interest as one who has been for a long time closely involved in farming. I do not need to be reminded that the current agricultural recession is painful.

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The problems facing UK farmers received a good airing only three weeks ago in the debate so ably led by the noble Lord, Lord Palmer. There is little new, other than official figures released underlining the concern shown in November. We are told that there has been a fall in farmers' incomes over the past two years of 63 per cent. There has also been a drop in the average income of hill farmers this year to £2,400. I do not have to remind noble Lords that a farm worker's minimum annual wage currently at the lowest grade is £8,600.
I do not think that the Government need reminding of that. On top of other measures described in November by the noble Lord, Lord Donoughue, and by the noble Lord, Lord Davies, today, the Government have produced the £120 million aid package slanted, quite rightly, towards the hill farmers. They are trying to lift the BSE restrictions and are understandably making slow headway in the face of an EC protective wall.
My remarks, therefore, are directed with diffidence towards my fellow farmers. There have always been ups and downs in farm profitability. But those fluctuations have occurred in a steady downward trend in incomes in real terms over the past 25 years. The causes are well known in the industry. Farmers are well aware, too, that an acceleration of that long-term downward trend was inevitable once the EC took the road, far too late in my opinion, towards reform of the CAP. Farmers have seen Agenda 2000 on the horizon and the eventual WTO-led and enlargement-led future reduction, or at best retargeting, of subsidies.
It is now more than seven years since sub-committee D, which I had the great privilege to chair for six years, produced its report on the MacSharry CAP reform proposals. Our conclusions have stood the test of time very well. I should find it difficult to improve on this extract from the advice we gave seven years ago:
"Reform of our price system will mean that farmers will have to increase their efficiency. Some measure of adjustment aid is essential. Such aid must be transitional; acceptable under GATT; fixed in quantum; not re-negotiable; and simple to administer".
Any farmer who considers that the direct compensatory payments that we have received since the 1992 CAP reform are anything other than adjustment aid and other than ephemeral in nature is short-sighted.
Farmers are well aware of the long-term trend and are adjusting. What has taken them aback has been the sudden combination of the shrinkage of world markets, BSE, low prices and the state of the pound, coupled with very bad weather which has led to the current downturn.
What does one say to UK farmers who see in the future a kind of Darwinian struggle for survival—the survival of the fittest? Perhaps one should remind them that Darwin understood that natural selection could operate only because of the inherent variability of individual organisms and the inheritable nature of those variations. Just as useful variations in nature may give a competitive edge in the battle for survival, variations in farming attitudes and methods may be needed to do likewise.
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Farm units will need to be bigger to be viable. Already, four out of every 10 farmers are part-timers. If smaller occupiers are to stay on their farms—and that is an extremely desirable social objective—then more of them must look for other sources of income. Therefore, as has been said so often, it is all the more important that non-farming economic activity in rural areas should be encouraged. That is something which can be facilitated through EC policies and by our own government policies.
In these days of food security and more affluent consumers, there is, as was pointed out in this year's Massey Ferguson lecture, a changing pattern of demand for high quality, safe, convenient and attractively-processed food. At present, food processing doubles the value of produce at the farm gate. That is before the costs of distribution and sales. Are there perhaps opportunities there for farmers to process their own products further down the food chain? If so, that could perhaps be performed by producer groups.
Farmers are not good at marketing and there is huge room for improvement in that field and for co-operative quality control and selling.
There must also be a drive for markets abroad. I wonder what happened to Food for Britain which was established by the noble Lord, Lord Walker of Worcester, when he was a Minister. Perhaps the noble Lord, Lord Carter, will remind us about Food for Britain and the point that it has reached.
It is perhaps significant that the most successful marketing initiatives have been in relation to products which are outside any CAP regime; for example, fruit, vegetable and poultry. One is tempted to speculate as to how much better would have been our marketing performance had their been no CAP support for the other commodities over the past 20 years.
As the noble Lord, Lord Palmer, reminded us, there is scope, too, for the non-farm use of farmland, whether it is for bed and breakfast, crops for industrial use, wind farms or whatever. Finally, it is plain that not all farmers are situated so that they can evolve and diversify. The purists will say that they will be eliminated under the harsh laws of economics. If that is so, there must be some kind of safety net for those failing in the struggle for survival.
If the rug is pulled out too sharply, the social costs will be heavy. In that regard, I find myself, as is very often the case, in agreement with the noble Lord, Lord Mackie of Benshie. For example, as was urged by my noble friend Lord Wade in the November debate, there must be devised policies and methods whereby farmers can purchase their retirement to ease their passage. Time does not allow me to discuss various schemes which have been mooted. Support, preferably outside the farm budget, must be available for farmers, particularly in the uplands, who would otherwise leave the land. The public are well aware of strong social and environmental reasons for keeping a cared-for countryside and they must be prepared to pay for it.

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The UK industry is well placed to flourish again, as it has after every downturn that I can remember. My fellow farmers have the wit to adapt and survive. They just need to use it and use it I am sure they will.
4.15 p.m.
Lord Cooke of Islandreagh: My Lords, after hearing the noble Lord, Lord Kimball, this afternoon, I felt that I could go home. He said all that I wanted to say and said it so much better than I could. Therefore, I shall not go over that ground again.
I was pleased to see that the debate refers to "the agricultural industry" because it is now an industry with far greater tentacles than a business. There is the processing industry, and village and rural life is totally dependent on farming. It is now a very complex industry which needs to be treated with care.
I must report that in Northern Ireland there is an even more disastrous situation than elsewhere in Great Britain, for a very simple reason. The agricultural industry was weakened by the BSE crisis and the embargo on exports because in Northern Ireland 60 per cent. of the beef was exported outside the UK whereas the figure for Great Britain was about 9 per cent. Therefore, that embargo weakened the industry and left us less able to withstand the disaster in relation to sheep and pig prices about which your Lordships will know.
The result of that is that the industry in Northern Ireland is in a parlous state. Small farmers have amassed a vast amount of debt—approximately £500 million with the banks at the moment, which is all against their land values. They have an extremely large indebtedness to their feed suppliers. There are many in the pig industry whose indebtedness to their feed suppliers is as much as the value of their stock.
We have another problem in Northern Ireland; namely, that the average age of farmers is over 50. It looks as though their children, their sons, will not go into farming. They have all been well educated; they are ambitious; and they just do not see a future in farming. We may be faced with a rural desert with all the consequences which would flow from that. That is unthinkable because, as we all know, we must have agriculture. It would be quite ridiculous to have a wasteland, perhaps even in trees. We must do something about it.
I have not yet heard that there has been any attempt to think through the position that farming is in now or how it should be developed in the future. That is an extremely difficult and complex matter but some attempt must be made in different ways. For instance, it may be that some farms have no chance of success. But there should be a scheme whereby farmers can retire without going bankrupt. Their present option is to go bankrupt and then retire in poverty.
Some thought should be given to how the industry has been distorted over the years by the various grant systems, the CAP and so forth, which have led to great trouble. Also, are we being sensible as a nation to impose standards of husbandry on farmers when the same standards do not apply abroad? For instance, the
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cost of rearing a pig has been increased by around £5 a head through the various measures introduced to husbandry. The measures are commendable but they are not in place in any other country. I understand that the Armed Forces import foreign pigs for bacon. I wonder what difference £5 a head would make to their acquiring food from abroad which is not raised under the same standards.
We must consider all these matters very seriously if we are to make any sense of the future. We must find a way forward in helping agriculture to thrive. I believe it can thrive, but not with all the distortions, extra costs and other problems which have arisen.
4.21 p.m.
Lord Monkbretton: My Lords, I, too, should like to say how grateful I am to my noble friend Lord Kimball for timing this debate so well.
I understand that net farm incomes—according to the NFU's figures—fell 49 per cent. last year. That figure excludes the cost of family labour whereas the Ministry figure includes it. It is perhaps more graphic to look at what has happened over the past two years. I understand that we are likely to find that net farm incomes have actually gone down by 80 per cent. One may well ask in those circumstances where we are going.
Agricultural output is falling. Bearing in mind agriculture's import-saving role, sooner or later that will impact on our balance of payments, as indeed will falling manufactures. The noble Lord, Lord Cooke, was absolutely right in saying that the young in particular are being forced off the land. That bodes ill for the future. If we are not careful we will be heading towards the abandonment of land and with it damage to the farming infrastructure. That will also badly affect the environment. Not all is lost yet but the situation is becoming extremely serious. There is an urgency about short-term measures and also about medium and long-term measures.
As my noble friend, Lord Inglewood, said, the most urgent requirement relates to interest rates and the high pound. That is problem enough for manufacturers but it is worse for British agriculture, which has to compete against lower priced imports and the fall in value of European Union aid. I must express criticism in relation to the interest rate policies since May 1997. Was it necessary to increase interest rates so much? Only the United States grasped and acted upon the need to fight off depression by reducing interest rates. The Bundesbank—I noticed that yesterday in The Times it was castigated and referred to as the "Blundersbank"—and Europe together generally did nothing to help those objectives. But we actually increased our rates, which was even worse. We must find a way of reducing interest rates or manufacturing industry will rust and agriculture will abandon land to weeds.
Perhaps I may turn to other more specific urgent agricultural matters. The need for an equal footing was mentioned by my noble friend Lord Stanley and I applaud that. We ought to apply UK standards to imported production. At the moment that is often not the case. And of course we should end the ban on beef on the bone.

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The Government might consider whether they should be taking steps to try to halt the rapid demise of livestock auction marts. My noble friend Lord Jopling referred to the poorer agricultural areas not quite within "less favoured areas". That may apply to areas such as the Sussex high Weald. It is in such areas that the shoe will pinch badly.
Perhaps I should declare at this stage that I come from Sussex and that, although I am partially retired, I still have some interest in farming. I hope the Government will bend their efforts to fund the Countryside Commission's high Weald land management initiative among other cases of that kind. I believe it will help. Also, in relation to Sussex, there would be a great deal of virtue in improving the environmentally sensitive area payments to retain grazing on the Sussex Downs and other sensitive landscape habitats.
In relation to medium and long-term objectives—I hardly dare mention this—I should like to say a word about milk, with which I have always been involved. The number of farmers ceasing milk production last year was 6 per cent. That is a high figure when we consider that the norm is somewhere between 3 per cent. and 4 per cent. I understand that we are the only country where farm gate prices have actually fallen recently. It is not only the high pound that caused that. While producer prices fell, the dairies increased their profits by 40 per cent or so. UK farm gate prices are now so low that some farming industry experts feel that milk production may well contract.
I wish to draw attention to the notoriously large difference between UK farm gate and retail prices and the fact that it is again on the increase. Action is required to find ways to equalise the imbalance in bargaining power between primary producers and the buyers and retailers. That applies not only in dairying. It may be that British dairying cannot compete against New Zealand; but we can compete extremely well with the rest. The opportunity to do this should not, I feel quite sure, be lost. We could do it if we do not make a mess of it, and I sincerely hope that we do our best. We do not want to lose this opportunity.
There are many other matters I could mention, but I shall leave them to others. I hope that they do raise them and that the few points I have made have been constructive.
4.30 p.m.
Lord Plumb: My Lords, I welcome the opportunity to speak in this debate and to add my congratulations to the noble Lord, Lord Kimball, for his initiation of the debate and also for the excellent way in which he opened it.
Everyone has recognised—it is so throughout the whole country—that the dramatic fall in farm income is estimated, as my noble friend has just said, to be over 70 per cent. in real terms over the past two years. It has been described as the worst situation since the 1930s, and we all know that the morale among many farming families is particularly low, especially among those small farmers who were mentioned by my noble friend Lord Jopling.
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I, too, declare an interest as a farmer and as an ex-farmer leader. As your Lordships can imagine, during my 20 years in the European Parliament I have been fairly close to the development of the common agricultural policy. I would say to my noble friend Lord Jopling that, yes, I look back to the days when we were together in 1984 and the difficulty we had in the presentation to farmers of a very radical change at that time moving towards milk quotas. He rightly said that they had been difficult to accept, but nevertheless they had been the saviour of many smaller farmers who at least had something to latch on to. It sounds rather like a cliché, when we are in the middle of this debate, to say that British agriculture is such an extremely important industry both nationally and internationally. We know that, but it is important in terms of food security, both in quantity and quality.
Food security is something of which we hear little these days. I was delighted that the noble Lord, Lord Beaumont, mentioned it himself when he recognised that we have been through difficult times and it is therefore important to emphasise it. It is also important for the part that it plays in maintaining our rural and national wellbeing and also for the key role that agriculture plays in the conservation of the countryside and its environment. If the environment is to be conserved then it is essential that we have a thriving farming business. We all know that a depressed agriculture cannot carry out its traditional role of caring for the countryside. A neighbouring farmer friend of mine some years ago used to say quite often to me, "I know how to farm a farm and I know how to rob a farm; and if I start to rob it it will take me 10 years to do it". I hope to God that we are not in that position today and see the start of a run-down of our rural areas.
The facts themselves are well rehearsed. Financial pressure is forcing the industry to seek significantly lower cost structures. Yet we import so many of our products: 83 per cent. of our seeds that we put back into our farms; 66 per cent. of our machinery; and 44 per cent. of our fertilisers, to name but a few of the inputs, at a cost which is much higher than that of our competing producers in other countries. Yet that market, as we know, has been virtually wiped out because of the distortion of currency values and the volatile world market as a whole—together of course with the disastrous BSE crisis. That has cost us over £4 billion, £1.42 billion of which has come from the European Union.
Of course I acknowledge the enormous problems facing Ministers and I appreciate the recent injection to help the pig industry and to help some of the farmers in the hills and uplands who have falling livestock prices. I am sure that is a point which will be well emphasised by the noble Lord, Lord Carter. However, Government have a very crucial role to play if farming is to be competitive. That can be achieved by avoiding the imposition of costs that have no justification in logic or science; by reducing external costs where possible; by minimising unfair competition by insisting on standards of welfare and food safety that apply in the United Kingdom applying equally in the countries from which we import; by requiring retailers to give consumers

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freedom of choice through clear labelling and by stimulating the development and acceptance of science and technology, including biotechnology.
The Government also have the responsibility for claiming from Europe our entitlement under agri-monetary arrangements. Therefore I ask Ministers why we failed to obtain the full recompense in 1997 and 1998. In 1997 under the European rules we would have been allowed to take £420 million to compensate United Kingdom farmers against the strength of the pound. This year the amount available has been £280 million and next year it will be £140 million. Half—I repeat half—of all this financial assistance has been available from the European Budget and, I stress, without the need for the United Kingdom to contribute one single penny—and that at a time when our industry faces insurmountable difficulties, with farm incomes at their lowest for many a year. And all the Government had to do was ask.
Over the past two years the Government have only required £67 million of EU agri-money assistance and yet £350 million has been available. I know that the noble Lord, Lord Carter, will tell me that of course we have to pay the rebate, but if he disputes my figures I would ask him to go to Brussels with me tomorrow and meet the Commissioner who emphasised this and gave me those figures only yesterday. So let us take whatever is available; let us take advantage of it. Are Ministers aware of the history of agri-money compensation to the United Kingdom? The United Kingdom is the only country that has not fully subscribed to EU assistance when the need was so great and so obvious. It gets worse. In 1997 and 1998 United Kingdom farmers have been eligible for £158 million of compensation for loss of earnings from direct payments. The Government have only asked for £11.5 million of that amount of money: that is a short-fall of £146.5 million. In 1999 £70 million of additional EU agri-money will be available to United Kingdom farmers. Some would say that it is far too little, far too late; but farmers need it and they deserve it. So are the Government going to ask for it?
I should like to finish by asking: how are we to face up to the reality of 11 countries deciding that their money should be in parallel—countries that are just on the outside of this great country of ours? As we know, United Kingdom farmers are facing this crisis. They may not be concerned either way as to what happens, but will the Government's failure to allow payment in euros to those who want it from the 1st January next year inhibit the commercial influence in the European Union and perhaps more widely? Are we to be further marginalised on the fringe of Europe? How will that impact therefore on an already traumatised agricultural industry?
Changes in the common agricultural policy and in the agri-money system will all add to the pressures on United Kingdom farmers and, of course, the impact of the European Monetary Union could be greater on agri-business than on other economic sectors due to our dependence on the European Union for financial support. Surely, therefore, our collective aims should be
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to improve the position of British farmers and to put agriculture at the forefront of civilised and acceptable progress.
4.40 p.m.
Lord Christopher: My Lords, I acknowledge the courtesy of congratulating the noble Lord, Lord Kimball, but I am less sure that I am as grateful to him as some other noble Lords because, when, back in the summer, I thought that agriculture would be something to which I could turn my attention, I had not bargained for how I would feel on the first occasion when I rose to speak upon it. My qualifications for speaking are very limited and I shall not dwell upon them. However, I hope that my remarks will be seen in a modest way as complementary to the extremely good speeches of the noble Lords, Lord Inglewood and Lord Cooke.
Eighteen years ago I deliberately moved back into the countryside to the heart of a village surrounded by four large farms. It is interesting to study what has happened to them over the past years. One is now substantially set-aside or part of the Countryside Stewardship Scheme, with a lot of birds but hardly anything else. Another has been, in industrial terms, asset stripped. I do not complain about the farmer in that respect; indeed, that is what the market told him to do. The land and the woodlands were sold off separately; the farmhouse was sold off separately; the farm cottages and buildings were sold off separately, including a magnificent Victorian Shire stud stables; and a pedigree Jersey herd (which had not bought in any stock for 30 years) was sold off as, indeed, was the milk quota. It seems to me that that process is being repeated throughout the country and, in effect, a fine farm is no more a farm. A pedigree Sussex suckler herd has gone from a neighbouring farm—I cannot bring myself to ask where—and it is now dedicated to horse grazing. Indeed, only one of the four farms is still functioning as a farm.
As I see the general situation, it seems to me that the root cause of a great deal of this is in fact the CAP. It is consuming a half of the European Union budget and the best thing that can be said about it at present is that at least the flaws in it are now being recognised by almost everyone. I begin to wonder whether in fact we might be better off without it. There are damaging consequences involved. Of the 25 million farmers in the original six member states who farmed, only six million are left. In the UK, the number of farmers has halved over the same period. A good example of the causes of this was the conversion of milk quotas into a commodity. That has brought about exactly the same effect upon farmers as the effect upon British motor and truck-tyre manufacturers when tyres became a commodity.
To the extent that I understand it, the agri-environmental measures under Agenda 2000 will certainly not replace the CAP. One economist has put them as representing no more than 5 per cent. of the budget. I would be interested to know how far 5 per cent. could be expanded to avoid—and I hesitate in these times to use this phrase—"level playing field charges".

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However, what modest solutions might there be? One speaker has already referred to marketing. A Farmers Weekly leader recently put it very bluntly, stating:
"UK farmers can no longer afford to be an industry that buys retail and sells wholesale".
Three leading supermarkets control more than half of all the food and drink sold in this country. The Office of Fair Trading is reviewing what has happened, but the Meat and Livestock Commission says that the margins since 1995 have pretty well doubled in favour of the retailers.
I believe that farmers must seriously explore the opportunities for collaborative marketing. A good example is to he found in Lincolnshire with the Lincolnshire Quality Beef and Lamb Marketing Group. It goes for quality but not quality in terms of washed carrots and clingfilm-wrapped beef; it is getting an average market premium of 12 per cent.
Another older example which was, incidentally, introduced by an Australian in 1920, is the Kent Wool Growers. There were 75 farmers in 1920 with 25,000 fleeces. Today, it has 4,000 members, half a million fleeces and a £6 million turnover. Again, the emphasis is on quality—grading 150 grades from 1.5 million tonnes of wool. It has now diversified around 20 ranges of products which it sells.
When we look at the regeneration of the countryside and the joint proposal from the Ministry of Agriculture and the Department of the Environment, we can see what a mountain there is to climb. A recent report from the Cheltenham and Gloucester College is utterly disturbing. It shows a picture of a divided Wiltshire—of all counties! In one village, 40 per cent. of the households' income is more than £40,000, but the income of another 40 per cent. is less than £8,000. Around the town of Pewsey, 25 per cent. of households are living at or near the poverty level. Over the whole county, 14 per cent. still do not have any central heating.
What other solutions might there be? Like farmers, I recognise that they are obliged to look to government to set core national objectives. I know that the present Ministers are as concerned about these matters as farmers most certainly are. But I would ask farmers to look at themselves, consider their image, and ask, "Am I right that it has gone down hill well beyond the old jokes?". I believe that it has. They will need public support if they want to get the things that they need. They need to be less reactive and more proactive. They need to explain and educate; and the Government could help in that direction. They need seriously to consider, and not simply dismiss, those things which the public say about farmers' methods of production. I need not list them because noble Lords will know what I mean.
However, perhaps I may just illustrate one of them; namely, the Farmers' Ferry. I can understand why some farmers felt driven to do it. They claim to have exported half a million sheep, although I doubt that figure. However, in PR terms, it was a real shot in the foot. It is not just the ferry and the lorry journeys: it is what happens to the stock when it gets to Italy, Spain and Greece. The general public hold all farmers responsible for such happenings.
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I say to farmers: open up your farms to the people. A while ago Sainsbury's was asked by a television company whether it could film one of its pig farms. Sainsbury's said no; the television company trespassed and was found guilty of doing so. Why? If there is nothing to hide, why should the public not know how farms are run and what is happening on them? I should declare an interest here because I do some consultancy work for them, but perhaps I may just refer to the outgoing approach of British Nuclear Fuels with its visitors' centre. It is one of the leading places for people to visit when they take a holiday in Cumbria.
When the Government set the core objectives, I advise them to give the NFU more authority and encourage it to bring forward policies over, I suggest, a seven-year period. That is what will be required to get farming back to where it should be, especially when one considers that there are more than 15 or 20 categories of farming. Collective support should be given to the NFU if it includes some proposals that will he unpopular with some farmers but popular with the people and government.
This is a world where realpolitik and the global economy will not be at all comfortable when organising the future. That was certainly my experience in the trade union world. Indeed, I am bound to say that I could call upon quite a number of witnesses in this House to that fact. I hardly ever obtained what I sought. Three months ago, I asked the Industry Forum, which I have supported from the very beginning, why farming is not seen by it as an industry. I am pleased to say that farming is now being seen as an industry and it is to be hoped that a study by it will be produced before too long.
I do not expect my noble friend the Minister to reply to everything that I have said, but I would certainly urge the Government, first, to find a means of serious financial backing for farmers for joint collaborations and marketing; and, secondly, to revisit the ADAS issue. If we want farmers to change and prosper, they need the best advice, and I believe that that should be free.
4.50 p.m.
The Earl of Radnor: My Lords, I, too would like to thank my noble friend Lord Kimball for tabling this debate at such a very apt time—although it is quite an unfortunate time after two bad years for the farming community.
Perhaps I may declare an interest in that I am chairman of a farming company engaged in the roles of what I would like to call orthodox farming, fish farming and forestry. In such an erudite debate as this, with contributions from people who know a great deal about the land, I am not quite sure that I will be able to fill my nine minutes, but I wish to make a few subsidiary points which have not yet been made by any of your Lordships.
The noble Lord, Lord Kimball, said that we must start by looking forward, not back. But we must start by looking at the present and seeing what it is like—and it is very bad. Noble Lords have quoted figures of declining income and so forth. The fact of life is that it is extremely bad, but take away the subsidies and it is a

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great deal worse; it really is quite impossible. I remember that in sub-committee D, under the able chairmanship of the noble Lord, Lord Middleton, we chatted away about meeting world prices, the GATT round and being on all fours with the rest of the world and its prices. At the moment, that is miles away, as far as I can see. The trouble is that although the subsidies are meant to be decoupled, no subsidy farming is decoupled until it ceases to exist. Subsidies are really meant to be decoupled to make up for a shortfall. If we are going to compete in the world market we need efficiency. Somehow or other some of those subsidies ought to be pointed at making farmers more efficient.
Although I was not there, I read that the Minister of Agriculture—and probably the head of the NFU—hinted at some form of co-operation. I am fortunate enough. I farm on a large scale—and I have declared my interest—and we are still making money. But the smaller farmers are probably not. In a way, they are probably very wasteful. I cannot outline any particular system, but somebody should be able to devise a way whereby groups of farmers could get together—possibly using the contractual industry as well—so that they could assume some of the cloak which we larger farmers wear quite successfully. That would be a better step forward than the £97 for every acre of every crop they grow, and so much more for set aside and so on.
Furthermore, we pay a fairly high price for our subsidies in terms of bookwork, deskwork and bureaucratic—I would not dream of saying "nonsense"—procedures. But some aspects take so much time that the farmer hardly has time to farm; he is making out a passport for his steer—a blue card, a green card and, for those who like football, a red card, I am told! It goes on and on. If you make a little mistake with the forms, you really are in trouble. We received our first threatening letter this year when we lost a bullock. We used to have 90 bullocks but now we have only 89—the other one had gone—so of course we were not paid for the non-existent bullock. That was fair enough, but then we received quite a tough letter saying that the next time we lost a bullock it would be much more serious and we probably would not be paid for any of them. That is just an aside. A tremendous amount of simplification could be done about the way our subsidies are received, particularly for animals.
Animals already have a passport, but they are now going to have a book, just like we do, and a bar code. By the time a bullock eventually meets its demise the book will carry at least three signatures—auctioneers, farmers and others through whose hands it has passed. Perhaps we can improve on that.
Another matter which has not been raised follows on quite well from what I have just said. Nobody in your Lordships' Chamber seems to have noted that today food in this country passes through very few hands indeed. I am told that Sainsbury's and Tesco's deal with about 51 per cent. of the food we consume. In addition, there is Somerfield, Asda, Morrison's in the north, and so on. There lies a tremendous danger to the farming community of which notice should be taken. Those big entities are very powerful. They presumably avoid the
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Monopolies and Mergers Commission because they do not join together in a monopoly; they are just large. They are tough purchasers, very tough sellers and—dare I say?—with the exception of Waitrose, with which I deal and which is excellent, they are sometimes very slow payers. The big entities are strong.
It follows that if farmers could get together in bigger groups without losing their identity there would be some hope of competing with these big entities. But probably more important would be an approach made to the auctioneers. They will lose their markets because those big players do not like markets. We should make the auctioneers into "agents" such as they have in Australia, where distances to the markets are too far to travel. The agent is the farmer's man. He knows where the animals are going and he gets the beasts together so that he has some bargaining power. Something along that line would be very important indeed. It would not be impossible for somebody to work out such a system.
In commenting briefly on the idea of the noble Lord, Lord Middleton, about processing food, I have to tell a story about my own experience with fish. We produce a lot of fish, approximately 1,500 tonnes a year, and we now have to process it. I never wanted to, but we now fillet, marinade and so on. The rules are very, very strict indeed. They are very strict from the Government, quite rightly; and far stricter from Waitrose, quite rightly. I went there the other day, dressed up in my white coat, my hair protector and white gumboots. The manager made a filthy face at me and said "For God's sake, go away!". I asked "Why?". He said, "The inspectors are here.". I said, "But look at me, I am wonderful.". He said, "It is your wheelchair; they think it is very insanitary.". I fled, I have to say.
4.58 p.m.
Lord Rotherwick: My Lords, I must first state that, like other noble Lords, I am a farmer, among other things, and, thank goodness there are other things in my life apart from agriculture. Agriculture is not a rich occupation. We have heard many figures from many noble Lords, and there is one that I wish to quote. Allowing for the deduction of family labour, the NFU forecasts that UK farm incomes have fallen by at least 49 per cent. in 1998 compared to 1997.
I pride my farm on being one of the best performers in the Cotswolds. Our 1997–98 projected accounts will show a loss after paying a notional rent. I am thankful that I am not a tenant farmer and I have deep sympathy for small farmers who are in considerable difficulty. I agree totally with the noble Earl, Lord Radnor, that smaller farmers should come together into bigger groups of farmers. Even I, as a substantial farmer, group together with other larger farmers in order to command a better bargaining position when selling grain and other commodities.
Most people perceive a farmer as having great wealth because of the land he owns. But the average return on capital has been in the range of only 2 to 4 per cent. The average farmer would have done much better if he had gone off to be retrained as a solicitor, an accountant or even a politician.

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Moreover, recently the Government have persisted in loading more and more industrial costs on his back, which increases his production costs and cannot be passed on to the consumer. Typical of these are the costs of both the harsher abattoir rules following BSE and the obligation to adopt welfare friendly production systems, which we all know are much stricter than those of his continental counterpart or other non-EU countries.
If high quality, safe foodstuffs produced under stringent controls result in higher food production costs, UK farmers must accommodate these higher costs. But then the UK consumer must be prepared to pay a higher cost for those foodstuffs. The UK farmer needs the Government to help the agricultural industry in informing the UK consumer of the different standards of food that he has a choice of by development of labelling, marketing and promotion of UK higher quality safe foodstuffs. At present some foreign foodstuffs, as we have heard from other noble Lords, are often not required to be produced under such stringent controls and are outcompeting our produce due to their lower production costs. The pear and pig industries are good examples of this.
Both the UK and Europe are in the process of examining the margins made in the food sector by supermarkets. But, from information already available, there seems little doubt that the prices they pay to the farming community have fallen considerably more than the prices they charge to the consumer. Deloitte & Touche, in its publication Farm Results 1997–98, compares actual net farm incomes for the three years 1995–96 to 1997–98 with its projection for 1998–99. Over that period the best sector is dairy and arable where the income per hectare has fallen from £227 to £95. In the root crop sector, it has fallen from £462 to just £64.
Let us consider for a moment what that means. It is the equivalent of a worker in the building trade earning £80 per day with regular overtime having to accept less than one day's earnings for a full week's work. For let us be aware that farm incomes do not disappear because the work is not there. It is simply that the recompense for the work has declined almost to vanishing point.
To make matters worse, the standard response by farmers to falling incomes is often to cut back on direct costs; for instance, by using less expensive older types of spray at lower rates. This can often result in more resistant weed species and lower output. They might cut back on indirect costs; for instance, by not buying that new high-tech sprayer, they will not be able to embrace newer spray techniques and improve savings on chemicals. They might cut back on such things as machinery, which has a knock-on effect on those associated fanning machinery industries. They might cut back on employing local trades people to do property maintenance and repairs. And so this vicious spiral continues.
I have already pointed out that agriculture is not like other industries in that its product is the food we require for life itself. If the producers are put out of business, our only recourse is to get our food from elsewhere. This is feasible but it reduces the ability of our citizens
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to control the quality of what they eat. The Sunday Times reported two weeks ago that chemical residues were found in 40 per cent. of foods tested by it—most of the offenders being from abroad. A report on Farming Today on Monday of this week indicated that antibiotic resistance will cause more deaths than CJD and that much of the problem will be down to agriculture across Europe.
We must be grateful for the recent government money given to specific areas of agriculture or to specific regions of the country. But this package is too little too late and it is unlikely to stem the tide of bankruptcy, despair and the flood of imports from overseas. Will the Minister tell us today what his Government intend to do to help? Perhaps I may suggest some helpful measures that he could carefully consider. It would not cost much to allow 100 per cent. depreciation of new capital equipment in the year of purchase. It would not cost much to abolish VAT on repairs to farm buildings. It would not cost anything at all to ensure that no further specialist taxes are placed on the farming community. We rely deeply on the Government to create an environment in which farmers can survive. At present, we are suffering from a non-competitive environment.
Finally, I should like to ask the Minister to acknowledge that the farmers of this land are the creators and guardians of our clean and attractive countryside that is rich in wildlife. They are responsible in large measure for the preservation of our historic landscape. They are the major players in the continuation of the rural lifestyle and, potentially, the providers of precious leisure facilities to large numbers of urban dwellers.
Earlier today, at the Countryside Commission's countryside access conference, the Minister of State for the Environment, Michael Meacher, stated that the leisure industry in the countryside was responsible for 400,000 jobs and that the 1994 figure of £4 billion that this industry generates makes it a bigger industry than the agricultural industry. Is it now the case that our UK agriculture industry has been relegated into second place behind leisure? One questions whether, without a strong and vibrant agriculture industry which is living, working and sustainable, our leisure industry will be the worse off.
I was interested to hear the remarks of the noble Lord, Lord Kimball, about the sporting industry because I suspect that, if Michael Meacher had added that on to the agricultural industry, he may well have found that the leisure industry came second to this great agricultural industry of ours.
5.9 p.m.
Lord Geraint: My Lords, I congratulate the noble Lord, Lord Kimball, on initiating this important debate. As many noble Lords will be aware, I have spoken many times during the past month about the plight of the agriculture industry. But today I shall be very brief indeed. I am just going to remind the Minister that we are still in a crisis.
I am concerned about the severity of the crisis in the countryside and its effect on the local economy. Farm incomes in the United Kingdom have fallen by nearly

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100 per cent. in the past two years. The incomes of Scottish farmers living in less favoured areas have fallen from £13,800 in 1996–97 to just £2,400 in 1998–99. The situation in Wales is even worse. The statistics released by the Welsh Office show that before the rescue package of £120 million announced last month some farmers were on target to make just £200 this year. Even after taking into account the emergency aid package, those same farmers will earn an average of just £1,400 this year. In my view, those figures are simply appalling. They vividly demonstrate just how bad things have become in Welsh farming. According to the majority view of Welsh farmers, the upheaval under which farmers have been struggling, confirmed by the recession in January, was the worst experienced since the 1930s.
I urge the retailers to play their part in rebuilding the agricultural industry. I have yet to hear a reasonable justification for why supermarket prices have remained so high when revenue to the farmers has plunged so dramatically. I hope that producers and consumers will be able to persuade the supermarkets to build a better relationship between everyone concerned for the sake of the people living in the countryside.
The figures I am about to quote are interesting. During the past three years, there has been a steady rise in the gap between producer and retail prices. There is a gap of 57 per cent. in beef prices; 56 per cent. for lamb; 64 per cent. for pork and 74 per cent. for bacon. I wonder who is profiting on the back of the producers. Perhaps the Minister will be able to let us know when he replies.
I am delighted to see the noble Lord, Lord Carter, in his place. He knows more about the agricultural industry than any other government Minister at present.
Noble Lords: Hear, Hear!
Lord Geraint: Noble Lords tend to agree with me.
According to a survey carried out at the Royal Smithfield Show, 97 per cent. of farmers do not trust supermarkets to be fair to the British agricultural industry and are worried and concerned about the increasing dominance of supermarkets. In my view, livestock farmers should close ranks on marketing and should sell their livestock through their livestock auction system which has been proved to be the best in the world. Farmers should act before the high-powered supermarkets try to destroy our auction system. United Kingdom farmers are well advised to sell their produce at auction.
The Government can advise farmers and all those involved in, and who live in, the countryside to diversify. They can grant extra subsidies or any other state financial aid; but one thing is certain: unless farmers receive a realistic price for their end produce, the present crisis will not go away and many farmers will find it difficult, financially, to carry on.
Once again I urge the Government—I do so quite regularly—to set up a Royal Commission to look into the problems of all the people who care for the
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countryside. I remind noble Lords that while we talk, 800 million people throughout the world are starving and the Government are still paying farmers for not producing food.
I also suggest that the Government should call together the chairmen of the supermarket giants and the leaders of the farmers' unions in the United Kingdom to discuss strategy so that we can make progress to save the agricultural industry. If there is a will—I repeat, "If there is a will"—there is a way out of the present crisis.
5.12 p.m.
The Earl of Clanwilliam: My Lords, as a non-fanner, I enter this debate with some trepidation, but perhaps I may be granted observer status. As such, I shall certainly not take up the full nine minutes.
Noble Lords have pointed out the plight of the small farmer, and that is what I wish to emphasise. He is suffering much more deeply than his large-scale opposite number in the farming community. It is the small specialist farmer, for instance, who has seen his stock prices plummet and has nowhere to turn. It may be that he has lost the feel for mixed fanning and forgotten the old ways. In addition, his son may well have left the land, seeing it as no source of future income, and requiring a way of life that is not compatible with the lifestyle to which he aspires. Not only may the present farmer be forced to leave the land; there will be no one to take his place. What price then the environment, with large areas of smallholdings deserted? It is a dreadful prospect that we face, and one which my noble friend Lord Kimball addressed with eloquence in his interesting introduction to this important debate, for which I take the opportunity to thank him.
Like any civilised society, we need small farmers to produce healthy, home-grown food. Foreign standards of production do not match our own, with the consequent difficulties for small farmers trying to compete. Nothing is new in this world—certainly nothing in this debate. One solution I would suggest is to take a leaf from across the Channel where Normandy and Breton farmers have successful co-operatives. Co-operatives have been mentioned by the noble Earl, Lord Radnor, and my noble friend Lord Middleton. The French co-operative farmers seem to have buried their innate suspicions of each other and have made successful inroads into sending their produce across the Channel to the UK. We can be assured that Brussels, in reforming the CAP, will favour such Francophile plans, which may well therefore be well placed to continue.
That brings me to the possibility of creating organic co-operatives, a feature badly needed in the organic world, and one which would enable the small farmer to enjoy the subsidies that this Government have increased to foster that system of agricultural production. In that connection, a new document has been published by the Family Farmers Association, which emphasises the need for co-operatives. I recommend that document to the noble Lord, Lord Carter. He may well find in that some ways of helping to promote organic co-operatives.

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Organic farming is a system of mixed farming which can bear the costs of changes in those world prices which affect the specialist farmer so deeply, and which allows a farmer to live off his own land. That provides the necessary security for continuity. I do not need to impress upon your Lordships the great advantages, in terms of both transport and price, for a specialist farmer in marketing his produce through a co-operative, thereby creating a continuous flow of goods to the ever-present supermarket. I shall draw a veil over my feelings about those controllers who abuse the market with impunity. The co-operative will enjoy the advantages of the economies of scale—that much-lauded phrase of the marketing man—and create the critical mass necessary for joint production. It will allow hill farmers to join with lowland farmers and create a whole system in any given area to produce cereals, meat and horticultural produce.
I cannot leave this subject without drawing to your Lordships' attention the recently produced report of the Soil Association, entitled The Use and Misuse of Antibiotics in UK Agriculture. That report draws on a wide range of authorities, not least a recent Select Committee report on antibiotics. I cannot refrain from thinking that an awful lot of problems which farmers are suffering today would have been avoided had they not been seduced into intensive farming. I recommend the report from the Soil Association to your Lordships and I shall arrange for all speakers in tonight's debate to receive a copy.
5.18 p.m.
Lord Nunburnholne: My Lords, I note the comments of my noble friend Lord Inglewood about small farmers, be they tenant or freehold. I have bad news for him. I live just up the road from him at the top of Alston Moor, not a hop, skip and a jump away, although I have not yet met him. On my moor—it is not my moor in that I do not own it—in the past 11 years five middle fell and low fell farmers have gone broke, two of whom have committed suicide. It was not this Chamber obviously—as one can see from the attendance here tonight—and it probably was not the other place (was it Brussels?), but who signed their death warrants?
5.20 p.m.
Lord Mackie of Benshie: My Lords, I, too, thank the noble Lord, Lord Kimball, for introducing this debate. Although I have spoken often on agriculture recently, he has taken the debate forward to the future. I do not share the general joy at seeing the noble Lord, Lord Carter, on the Front Bench. Poachers who turn gamekeepers are always worse and perhaps we might have done better to have an amiable chap to reply to the debate who does not know as much about agriculture as the noble Lord. Nevertheless we have a good case. If we had a bad case, we could do with an amiable fellow to reply to the debate. However, as we have a good case I trust and hope that the noble Lord, Lord Carter, will push it in the right direction where the trouble starts which, I understand, is in the Treasury.
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I wish to discuss the general situation in agriculture throughout the world. We were the first country to industrialise and at the same time we experienced a revolution in agriculture. In the late 18th century and the 19th century we built up an efficient system of farming. That lasted until 1870 when the Vanderbilts built railways across the prairies of America and grain started to pour into this country. That store of grain was grown on soil fertilised by the buffaloes over many centuries. Since then farming has only really prospered when there has been some disaster. During the two wars farming was prosperous. In between the wars there was the misery of the appalling depression of the 1930s. At that time agriculture was competitive. Farmers on the plains of America have been ruined, as have farmers in the Argentine. The primary producer is at the mercy of a savage and ruthless market. Whether he produces cocoa, coffee, tin or any other commodity, the primary producer is always hit when things go wrong.
In this modern world we should be able to produce a system of agriculture that is productive, that cares for the countryside and at the same time feeds the people. That is what has happened, of course. The people of this country may say that they pay too much for food, and perhaps they do. However, the proportion of money spent on food per family has fallen steeply in recent years. We have to ensure that we make the system work. The CAP was an admirable idea but it was ruined completely by politicians. Every time the Commission put forward a case for a reduction in prices, the politicians said that voters in Bavaria or wherever did not want that, and therefore prices were increased, with the result that we are in the situation that now pertains.
We are now approaching the advent of this great Agenda 2000. Every single political party, including my own, says it is committed to producing competitive agriculture. It is easy to produce competitive agriculture, but we also want prosperous agriculture. I have sworn that I shall not mention the term "a level playing field", so I hope noble Lords will take it that I have not used that term. On the previous occasion we discussed agriculture I mentioned some figures as regards the cost of labour in Poland and Hungary. The price of a tonne of barley at present will pay the wages of a man in Poland for nearly four weeks, but the price of four tonnes of barley will pay the wages of a man in this country for only one week. That is the kind of competition that we are up against. We are also up against subsidised agriculture in eastern Europe.
A friend of mine who farms in Hungary discovered that a combine which costs him £120,000 in this country costs him £80,000 there. In addition he received £27,000 in subsidy from the government for buying the combine. Therefore the combine cost him £53,000 rather than £120,000 in this country. That makes a great difference to costs per acre. When the Government consider the entry of the countries of eastern Europe into the European Union and the reform of the CAP, they must ensure there is some form of equality as between producers in the countries of the European Union. Obviously the standard of living of farmers in Hungary and Poland is far too low. However, we must have equality of opportunity.

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The other thing that the Government must do is to establish their food standards agency—call it what they will—as an independent body which will be respected. Farmers are criticised by people who think that something must be wrong if farmers use fertilisers and pesticides. The noble Lord, Lord Christopher, said that the public has been critical of farming methods. However, those methods are all under the control of government agencies. It is up to the Government to ensure that the public's fears are proved groundless. The Government must ensure that research is carried out on these matters. One needs money to undertake research on the use of antibiotics and other such matters. I shudder when I think of feeding chickens with antibiotics not to cure them of something but to make them put on more flesh. I and many other people want to know whether that will cause harm. The Government must spend the money to enable research to be undertaken on these farming methods. It is no good asking farmers to produce food for the masses in this country at a reasonable price but then slating farmers for doing so. The Commission's Agenda 2000 refers to the necessity to support agriculture.
Do Her Majesty's Government want agricultural incomes to be as high as industrial incomes? Is that one of their aims? It is certainly mentioned in the Commission's document. There have been many good speeches in the debate but the most savage one that I enjoyed the best came from the noble Lord, Lord Plumb. He gave figures that he obtained direct from a commissioner. I trust and hope that the Minister will accompany the noble Lord, Lord Plumb, to meet the commissioner in Brussels tomorrow to ensure that we gain access to the money that is available, even if it costs us 70 per cent. to do so rather than the 50 per cent. it costs other people. Those are questions that the Government must answer.
I have referred to the food standards agency and equal standards. If the Government can achieve those basic things, then the farmers have a chance. I agree with the noble Lord, Lord Middleton, that there must be a scheme to alleviate the lot of small farmers who are going broke and are in despair. We must see to it that they have a chance to leave the industry gracefully, or to stay in the industry and use all the facilities such as machinery rings and so on that exist nowadays. If that is done, I am sure that we shall return to a period, not of great prosperity, but of reasonable prosperity, which will keep people on the land and keep the land right.
5.30 p.m.
Baroness Byford: My Lords, I, too, wish to thank my noble friend Lord Kimball for providing the opportunity for this important farming debate. It has ranged widely and has reflected the immense pressures under which farmers currently work. Rightly, my noble friend focused our minds on the future of the agriculture industry. He touched on many matters. I shall name merely a few: further enlargement; reform of the CAP; Agenda 2000; constitutional changes; less favoured areas; and environmental and rural support. That brief list serves to indicate the huge diversity in farming and
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the problems faced by the industry today. I declare a slight interest in farming as a retired poultry farmer; also, my husband has an interest in farming matters.
Many speakers reflected the continuing demise of our agriculture. While there is a degree of optimism in certain sections of the industry, many real problems still face our farmers. The partial lifting of the beef ban by the European Commissioners last week was welcome. However, the ban will not be lifted until March or April. Continued restrictions on selling beef on the bone lessen our drive to regain export markets lost to us over the past three years. The Government have made an additional £120 million available, which is to be welcomed. However, that financial help has gone to only a narrow section of farmers. For some, that help has come too late.
Beef farmers wish to see a return to normal trading as soon as possible. The lifting of the ban on beef on the bone is essential, as much of our former exported beef was purchased abroad through buying the whole beef carcass, not merely beef off the bone. If our export markets are to pick up, that is an important move that must be made. I hope the noble Lord the Chief Whip will be able to tell us more in his reply.
At a time when farmers believe that EU moneys have been available to assist them in the current crisis, the Government have not seen fit to seek extra help under the hardship fund. The noble Lord, Lord Plumb, made that point. I understand that there is likely to be an under-spend of moneys allocated within our agriculture budget. That is a matter of concern. Will the noble Lord, Lord Carter, also comment on that in his reply?
At the Smithfield show last week the Agriculture Minister acknowledged that farm incomes had dropped. There was a drop of 33 per cent. between 1988 and 1997, with a further fall in 1998. That is a second fall in a row. Total income from farming has fallen by 63 per cent. in real terms. The Minister went on to say that the cutbacks mean that it is unlikely that additional cash will be available to promote the marketing initiative that is so urgently needed to relaunch our markets abroad.
The situation cannot, and must not, be allowed to continue. The dramatic fall in farm incomes forecast for 1998 is due to a further sharp fall in the value of output from the industry of some 10 per cent; that is, around £1.6 billion in monetary figures. That fall in the value of the industry over two years totals some £3.5 billion. Although welcome, the recent package of help of some £120 million offset against that figure only highlights the dilemma facing the farming industry today.
The pig industry has experienced a difficult year, with profits plummeting. Additional costs have been borne by producers. It is estimated by the ABN that some 11.3 per cent. has been added to base costs to cover costs resulting from the ban on meat and bonemeal, the stall tether ban, farm assurance schemes and deductions made at the abattoir. Those extra costs have come at the same time as falls in prices and as a direct consequence of the comparative price of imports, which are not subject to the same standards of welfare or food safety.

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The poultry industry has also gone through a difficult time. However, it, like other areas of the industry, is launching a positive promotional fight-back campaign. What it seeks is fairness. Imports to the UK need to be more rigorously inspected and to be seen to be inspected by the Government. Each poultry processing plant in third countries wishing to export to the EU should be inspected by EU vets prior to their being allowed to do so. Currently, it is the authorities in the third country that decide whether the plants comply with EU hygiene rules and standards. The results of tests of UK poultry meat for residues are published every quarter. No test results are published for poultry meat imported from third countries. The lack of information is serious. Producers in third countries are permitted to use veterinary products and feed ingredients that are banned in the UK.
Labelling and food standards have been mentioned by other noble Lords. The agreement with the British Retail Consortium on labelling must also apply to fresh and frozen poultry meat and to imports of finished further processed products from third countries. Such products should not be permitted to be labelled as British. If such labels are misleading on pork, they are equally misleading on poultry meat. As for pigs, meat and bonemeal is banned from poultry feed in the UK. However, poultry producers outside the UK still use it. The ban is to protect the UK beef feed chain. But that protection adds some £30 million annually to the feed bill of the British poultry industry which our competitors in other countries do not have to pay and for which we receive no recompense.
The debate touched on hopes for the outcome of Agenda 2000 and the reform of the CAP. They are crucial to our farming industry. In the ministerial Statement to the House on 16th November the Government stated that the reform of the CAP must create the conditions to allow sustainable and competitive EU agriculture to operate effectively on world markets. Will the Minister define more clearly what is meant by "sustainable" and how the Government see that being achieved? The Statement goes on to say that they wish to see a freeing up of resources to offer scope for better targeted measures to support the rural economy and enhance the environment. Again, perhaps I may press the Minister for greater detail.
The debate has also touched on the early retirement scheme. Farmers are indeed facing difficult times. For those of more mature years the possibility of early retirement is an attraction. The scheme does not require amalgamations, but would enable those who will not survive in the industry to leave it with dignity. What is the current position with regard to the scheme? My noble friend Lord Stanley referred to it earlier.
I turn now to the wider issue of the countryside, for farming and the countryside go together. Two meetings have today taken place in London. The Countryside Commission held a conference to consider countryside matters. I was not there, but I understand that the right honourable Michael Meacher spoke to the conference about the consultations on the right of access and admitted that most demand was for access close to cities
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and towns. I understand that there was no mention of farming or horticulture. Our farming future is reliant on a total overview. I am somewhat concerned about that.
In this House there was a presentation by Partnership in the Countryside and English Partnerships, which I attended, which dealt with working with rural communities. Those bodies are looking at practical ways to enable communities to help themselves. They encourage community-based businesses and aim to provide information, contacts, funding and examples of good practice. This is important and underlines the immense pressure that farming is under at present.
We could have no one better than the noble Lord, Lord Carter, to reply to this wide-ranging debate. The tremendous pressures upon small tenant farmers, world influences, level playing fields, better use of diversification, the situation in Northern Ireland, food security and the cost of form-filling are but a few of the items that have been mentioned. This has been a worthwhile debate and I thank my noble friend Lord Kimball for making it possible.
5.41 p.m.
Lord Carter: My Lords, before I reply to the debate, perhaps I may, as Chief Whip, congratulate noble Lords on the brevity and succinct nature of their contributions. I now have about an hour in which to reply!
Like other noble Lords, I thank the noble Lord, Lord Kimball, for tabling this Motion and all those who have spoken in the debate for the excellent contributions which we always expect from this House on agricultural and rural issues. In the time properly allowed to me, I cannot hope to respond to all the questions and points that have been raised. However, I shall ensure that all those who do not receive a reply from me today will receive a response in writing.
Because of my former farming interests—which are well known—and my previous connection with an agricultural consultancy, I should make clear that I have made arrangements to relinquish those interests and that those arrangements have been approved by the Cabinet Office. On becoming a Member of the Government, I faithfully followed the guidance provided by the Cabinet Office and the Registrar of Interests in your Lordships' House.
This has been an excellent debate and I congratulate the noble Lord, Lord Kimball, on raising such an important question. This debate and a number of recent ones demonstrate the concern and commitment of this House to the well-being of agricultural and rural communities. The Government acknowledge that the agricultural industry is going through a very difficult time at present and that times are hardest for those in the livestock sector. That is why on 16th November my right honourable friend the Minister announced a package of aid worth £120 million for the livestock sector and why the Government have taken a number of other measures to ease pressures and encourage development.
I agree at once that the total income from farming figures carry grave news. I in no way wish to belittle the difficulties that farmers face, but we all know that

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farm incomes are cyclical. In recent years, they have benefited greatly from devaluations and improved productivity. The pendulum has now swung back, with the strengthening of sterling and the over-supply of commodity markets. It is not that many years since, for the first time since the war—and certainly for the first time in my professional experience—tenant farmers were applying to arbitration to have their rents frozen or reduced because of the reduction in farm profits at that time. It is not many years since figures from the NFU showed that farm incomes were at their lowest in real terms since 1945. Farm incomes are cyclical, and I do not for a moment underestimate the problems that farmers now face.
The strength of sterling has been the main contributory factor towards the fall in farm incomes, with the strong pound hitting exports and boosting imports. There has also been a world-wide reduction in prices for most major commodities. But these are not the only reasons. The continuing weakness of the beef sector following the BSE crisis has not only hit beef farmers but has had knock-on effects in other areas. In addition, there has been the collapse of important export markets in Russia and the Far East, which has exacerbated the problem, and the over-optimistic assumptions about the scale of future demand, which led to expansion in some sectors, particularly in pigs.
We acknowledge these difficulties. That is why we have been listening to farmers and their representatives across the UK and why we have already taken a series of steps to help our agriculture, for both the present and the future. When I spoke to Mr. Nick Brown, the Minister, this morning, he asked me to emphasise in this reply that we all need to work together to ensure a competitive, viable and profitable farming industry for the future which will safeguard our rural areas. The CAP reform provides an opportunity in this direction. For example, the rural development proposals set a framework for strengthening our rural areas. We hope to see a redirecting of funds to rural development measures and increased funding for agri-environmental measures. We have been listening to farmers and their representatives and shall continue to do so. My right honourable friend the Minister is planning a broad consultation with all those involved in farming on the way forward on Agenda 2000.
Turning to the individual sectors, we recognise that this has been another difficult year for beef and sheep producers. For beef producers, the market has been influenced adversely by the export ban, continuing structural surplus, falling market prices and falling demand. For sheep producers, there have been two consecutive years of delayed finishing and poor market prices.
EU beef and sheep regimes prohibit the Government from taking unilateral action to support market prices. We have introduced a number of measures to assist the plight of producers. In February, £85 million was distributed to beef and sheep producers in compensation payments. We have recently received agreement from the Commission to open private storage aid for sheepmeat in the UK, to extend beef intervention
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arrangements in Northern Ireland for the remainder of this year and to increase the advances payable under the beef special premium and suckler cow premium schemes from 60 per cent. to 80 per cent. As I have said already, on 16th November a further aid package worth some £120 million was announced which, subject to Commission approval, will provide agri-monetary compensation in the form of supplementary payments under the suckler cow premium scheme, increased payments under the hill-livestock compensatory allowances scheme and the continuation of the calf processing aid scheme until the end of the current financial year.
The recent decision to lift the beef export ban will in time ease at least some of the pressures currently faced by beef producers. The lifting of the ban was a major objective of the Government's policy on agriculture. Tremendous efforts, led personally by the Prime Minister, have been made over the past 18 months to achieve this outcome. This demonstrates our commitment to securing a long-term future for the beef industry. But no one should be in any doubt that, unless the fundamental imbalance of the EU beef market is addressed and corrected, there is unlikely to be a sustained return to profitability within the industry. Against this background, it is clear that reform of the regime is essential.
Turning to the question of beef on the bone, my right honourable friend the Minister welcomed the SEAC assessment of the risk when it met on 9th November. The report is now being considered within government, and in particular by the Chief Medical Officer who will advise Ministers soon. In addition, we need to take account of the potential effects of the Commission's recent proposal for Community-wide controls on specified risk materials. Once this process of consideration is complete, there will be a further announcement about UK controls on bone-in beef.
We all know that it will take time for the British beef industry to regain markets which have been closed to it for the past two and a half years. But the conditions are now in place for the industry to plan for the future. While it will not be easy to renew lost markets, the endorsement we have given of the safety of British beef can only act as a boost to consumer confidence and the industry generally.
I turn now to the pig sector. We know that the pig industry is going through a very hard time at present, with market prices well below the cost of production. Until last May, I had been involved in the pig industry for nearly 40 years. The situation now is the worst I have ever known. This is an EU-wide problem caused in the main by over production, the loss of valuable export markets and a reaction to the very high profits that we made until 1996. The EU pigmeat regime is very light and contains no provision for direct aids to producers of the kind introduced for beef and sheep farmers. To pay these as a state aid is not an option as it contravenes European law. We oppose all state aid schemes in the pigmeat sector because they can distort trade, interfere with the market and risk prolonging the crisis. I hope that they are listening in France.

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The pig sector benefits from a number of market-related measures agreed within the European Union and supported by the Government. These are worth almost £100 million in market support across the EU this year. The measures include the re-introduction of refunds on exports of fresh and frozen carcasses and cuts of pigmeat; two further increases in those refunds, including a 75 per cent. increase in exports to Russia; and the introduction of an aid to private storage schemes. My noble friend, Lord Donoughue, the Parliamentary Secretary, has spearheaded a campaign aimed at the catering and food service sector with the objective of increasing the use of British pigmeat products in a sector which takes 30 per cent. of the pigmeat market. The Government have received undertakings from the major retailers that all their own label fresh pork, bacon, ham and sausages will come from stall and tether and MBM-free systems. In addition, they will not sell imported fresh meat processed or packaged in the UK under a British label.
The arable sector also faces difficulties due mainly to a run of very big harvests in cereal-producing regions across the world. Other factors have been the strength of sterling and the poor weather. But we have emerged from a number of years of excellent arable profits which as we all know have been capitalised in the price of land. Recognising these adverse weather conditions, the Government took action to help UK cereal farmers in September by relaxing the moisture content limit laid down by the EU for cereals sold into intervention from 14.5 to 15 per cent. This helped to reduce the costs incurred by the industry in drying grain and was welcomed by the farming industry. The Ministry also made good progress with this year's arable area payments. Some 98 per cent. of advance oilseed payments were made by the end of September. Main arable payments started in October and are due for completion by the end of December. I am pleased to be able to say that about 85 per cent. of these payments have now been made, totalling over £700 million.
The noble Lord, Lord Palmer, made reference to bio-fuels. MAFF, through the work of the Alternative Crops Unit, is promoting the uptake of crops as a source of renewable raw materials for energy and industry. The unit encourages developments in non-food crops by maintaining databases, disseminating information and organising a programme of seminars and workshops. The question of possible support for energy and industrial crops is now being considered in the Agenda 2000 proposals for CAP reform. Industry has voiced concerns over the future of voluntary set aside and the uncertainties of future support for non-food crops. The Agenda 2000 proposals did not contain any specific recommendations for energy and industrial crops, but recognised that renewable raw materials could represent a new opportunity for agriculture and forestry and contribute to job creation in rural areas. They can also make a significant contribution to achieving the climate change commitments that we have made.
The Commission has committed itself to producing a report within the context of Agenda 2000 on the present state of the non-food and energy crop markets and their future development and, if necessary, to make
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appropriate proposals. I understand that the Commission will make an initial report to the Agriculture Council next week. The UK will be pressing for a serious discussion about the future development of the energy and industrial crop sectors.
We know that the hill areas have always had a particular sensitivity. In addition to the aid given to hill farmers in the recent aid package, in the longer term we want to replace HLCAs with a new scheme which will deliver support to hill farmers much more effectively to ensure that hill farming has a more secure and sustainable future. The aim of the new scheme will be to help maintain the environmental and social fabric of upland areas. The issue is being considered in the context of Agenda 2000 proposals for reform of the common agricultural policy. These envisage a change in the basis of granting support to the less favoured areas. The key proposal is that compensatory allowances will become area payments and have a clearer environmental objective instead of the livestock headage payments which we have at present with HLCAs. We all know their environmental effects. We realise that change may not be easy and we are keen to hear the views of all interested parties before deciding on the way forward. We hope to start consultation on options for a new scheme later this year.
The wellbeing of agriculture cannot be secured completely by response to short-term crisis, helpful though that may be in particular sectors. The Government are also looking at ways in which long-term stability and prosperity can be brought into the rural economy. First, the proposed reform of the CAP provides an opportunity for change. The Government would like to see the policy reformed to phase out production-linked support, allowing European farming to develop into a competitive industry that can survive and prosper in increasingly open markets. In doing this, however, we must and do recognise the importance of farming to the environment and the economy of rural areas. As a former member of Sub-Committee D of the European Communities Committee of your Lordships' House, I well remember the number of reports that it produced which supported this policy framework.
We therefore welcome as part of the Agenda 2000 process the Commission's proposal on support for rural development. The proposal sets the framework for strengthening the environmental and rural development components of the CAP, allowing member states to prioritise their wishes for environmental action, support for less favoured areas, forestry, structural adjustment and diversification. Most of the measures would be able to be applied across the whole country. However, much more needs to be done in the way of redirecting funds towards the rural economy before these proposals can take effect. In line with the Government's commitment to the rural environment, the Comprehensive Spending Review provided for a continuing expansion of areas subject to agreement under the major agri-environment schemes in England. An extra £40 million is being made available over the next three years to fund improvements and enhancements to the schemes.

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The Government are also committed to examining the future needs of agriculture and the countryside. In connection with Agenda 2000, my right honourable friend the Minister of Agriculture plans broad consultation with all parts of the industry. The Government's manifesto on which we fought the election set out a number of pledges that outlined our approach to the countryside and rural matters. We have been taking forward policies for rural areas in many different ways. In addition to aids for agriculture we have made available an extra £50 million a year for rural public transport and increased the target for development on brownfield land to give extra protection to the countryside. The Government now intend to put all these policies together and set out a framework to help achieve our vision for the future. The proposed interdepartmental rural White Paper will be a clear example of this approach to policy.
We hear all about supermarkets that exploit farmers. We look at the agricultural industry to take initiatives where it can. There have been recent allegations that supermarkets exploit farmers based on the differences between market and retail prices. We have heard them today. We understand that major retailers are demanding and powerful customers. But farmers appreciate that they also provide access to millions of consumers. It is inevitable that small businesses such as farmers will encounter difficulties when dealing with major companies such as supermarkets. But we have to be realistic. Today most sectors of business operate in an increasingly global market. If we cannot supply what the customer wants we can be sure that somebody somewhere can and will. Producers therefore need to be able to deal effectively with major buyers. This often means collaboration so that producers can offer the scale, quality and consistency of supply required by the major buyers.
For that reason, we have joined the NFU in a joint initiative on collaborative marketing described as "building business advantage". My right honourable friend the Minister and the President of the NFU launched the process at the Royal Smithfield Show. The idea is a simple one. By focusing on the successful practitioners we aim to highlight the benefits of collaborative marketing such as economies of scale and access to professional marketing assistance and technical support. Over the next few months, the NFU will hold a series of regional seminars at which the benefits of this approach can be discussed. There will be opportunities, too, to see successful co-operative activity in action.
As I read out this brief, I have a strong sense of déjà vu. The noble Lord, Lord Plumb, will remember very well the initiatives in the early 1970s in which we were both involved. Does he remember the proposal for the establishment for the British Agricultural Marketing and Development Organisation (BAMDO)? In agriculture and policy making, I fear that if one stands in the same place the policy caravan passes and repasses.
The noble Lord, Lord Inglewood, mentioned Article 39 of the Treaty of Rome. That is an admirable statement of the objectives of agricultural policy. It is a statement
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which is not far removed from the preamble clause to the Agriculture Act 1947, which was the foundation of our post-war agricultural prosperity. I cannot help but point out that the Agriculture Act 1993 repealed the objectives clause of the 1947 Act. It was a simple and understandable repeal. In my view, it marked a watershed in UK agricultural policy because it recognised that policy decisions have finally and irrevocably moved from Whitehall Place to Brussels.
The noble Lord, Lord Plumb, mentioned enlargement. We all know that the European Union now stretches from the Arctic Circle to the Mediterranean and from the Atlantic to Poland. After enlargement it will stretch from the Atlantic to Russia and almost to the Adriatic. This enormous geographical, social and agriculture structure cannot but present an enormous challenge to the whole future of the CAP.
I was asked a technical question by the noble Lord, Lord Plumb. He asked why all the agri-monetary compensation had not been taken up. As he knows, there are limits on the amount of compensation that can be spent on each of the four sectors eligible for aid, which are beef, milk, sugar and cereals. Because of EU rules most of the aid which is currently available is payable only to the cereals sector. We decided not to do that. The United Kingdom is paying the maximum available to the beef sector in the second year of the three-year package. A further small package of aid would be available to the beef sector as a result of the revaluation on 3rd May. Up to half of that package can be reclaimed from the EU budget without any further matching national contribution. The plans will need to be notified to the Commission by May of next year.
We should not overlook the effect of the freeze on the green rates. That freeze ran for several years. It had the effect that the conversion rate from ecus into pounds sterling was fixed at a higher rate than it would have been otherwise. So payments to UK farmers under the livestock and arable schemes were considerably higher than if the rate had not been frozen in recent years. I do not have the figure by me, but I believe that it was some hundreds of millions of pounds over the period to which it applied. I see that the noble Lord, Lord Plumb, is nodding.
There is an idea that compensation has no cost to the UK Exchequer. The operation of the United Kingdom's European Union budget abatement means that even paying the EU reimbursed element of agri-monetary compensation carries significant public expenditure implications for the UK Exchequer.
There are other questions to which I shall reply in writing. One noble Lord referred with some praise to the American Farm Act and the way in which farmers there have to manage without subsidies. As a result of the recent 1999 Agricultural Appropriations Bill, United States farmers will receive an additional 7 billion dollars in the form of disaster aid and tax relief.
The noble Baroness, Lady Byford, asked me about the underspend on the agricultural budget. There are no significant underspends on that budget this year. It is true that we allowed for greater expenditure in the EU livestock and arable schemes in the estimates that we

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submitted to the Commission. However, these schemes are demand-led and are totally funded by the European Commission. Therefore, there is no specific provision for them. For example, it is simply not the case that, because the total value of livestock and arable direct payments administered by agriculture departments this year is less than forecast, the difference is available to fund compensation. It is not true that there is money available for the Government without any additional cost to the UK Exchequer.
I hope that I have answered at least some of the points raised in the debate. I shall certainly ensure that all those which have not been dealt with will be answered in writing. It has been a good debate. It has given me the opportunity to show that the Government—
Lord Mackie of Benshie: My Lords, can the noble Lord answer the simple question that I asked him? Do the Government still stand by the 1947 Act and by the statement of the Commission that in agriculture we deserve a standard of living comparable to that of others?
Lord Carter: My Lords, we certainly support the objective of Agenda 2000. But as I have said, that objective was set out in the 1947 Act and repealed by the previous government. Perhaps I may end with the remarks with which I concluded my maiden speech in this House nearly 12 years ago. I quoted A.G. Street. He once observed that for farmers everywhere in the world the most important and urgent question for them every day was not what the politicians would or would not do for them, but whether it would rain tomorrow.
6.4 p.m.
Lord Kimball: My Lords, I begin by congratulating my noble friend Lady Byford on her first speech from the Dispatch Box on her new portfolio. Those of us who are familiar with her husband's farm will realise that she comes from a very knowledgeable farming background. Perhaps I may also say what a pleasure it is to have the wind-up speech made by the noble Lord, Lord Carter. His knowledge of the subject is well known. It is very much appreciated by all of us that he has chosen to reply to this debate. We have had what I can only describe as an informed and sympathetic debate. I thank all noble Lords who have contributed to it and who have taken so much trouble to raise so many constructive points. With those few words, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

National Health Service
6.6 p.m.
Baroness Cumberlege Baroness Cumberlege rose to call attention to rising expectations and advances in medical science and their implications for the National Health Service over the next 50 years; and to move for Papers.
The noble Baroness said: My Lords, before I open this debate I would like to declare an interest. I am an executive director of a management consultancy firm called MJM Health-care Solutions. Ninety-five per cent. of our work is for and with the NHS.
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I love the NHS. I grew up in it. My father joined it as a GP in 1948. In my home we literally had blood on the carpet when patients came to the house in extremis. My father's surgery was in part of a converted boarding school for girls. It was reached by a rickety outside fire escape. In my village one had to be very fit to visit the doctor. It was heated by a paraffin stove and the icy temperature of my father's hands were legendary. It was said that he could make babies jump in the womb.
As children we were drip-fed with the importance of the NHS ethic based on the Christian principles of love thy neighbour and each according to his needs. My father's compassion, care, application and scientific knowledge brought home to us the reality of that ethic. He never spared himself or us if a patient was in need. It is a fine ethic and highly prized by the British people.
My concern and purpose in calling for this debate is not to "have a go" at the Government, although I know that the role of the Opposition is to oppose, question, seek to amend and refine. We shall do that later in the parliamentary year when the Government introduce their health Bill. But my purpose tonight is to debate with all sides of the House—I am very grateful to many of your Lordships who are taking part in it—how we can absorb modern technology, social change and people's aspirations while maintaining this much prized ethic, which we know so well, whether young, old, black, white, rich or poor or Prince William hit over the head with a golf club; the drunk in the gutter—all have a right to healthcare largely free at the point of delivery.
With infinite demand outstripping limited resources; with a service which is so popular but without a buoyant financial base to support it, quite simply tonight I ask this question: is the NHS sustainable and, if so, how? Successive governments, of course, have chipped away at the edges with prescription charges, charges for dentistry, eyesight tests and so on. Every government have recognised the value of lifting some of the burdens through occupational health schemes and through redrawing the boundaries between social care, which is means-tested, and healthcare, which is free. Every Government have sought to make the NHS accountable not only in clinical practice but in the use of resources. And every government since 1979 have increased the contribution from the taxpayer.
I do not wish to waste time bandying about figures, arguing which government in which year invested more resources in the NHS. I think that that is a barren debate since it inevitably gets into the territory of real growth, spinned growth and "double counting"—an art form in which I have to say this Government excel. Suffice to say that the average growth for the NHS over the past few years has been around 3 per cent. and future growth is likely to be roughly of the same order with inflationary pressures taken into account.
So I do not want to look back; I want to look forward. A new book published by the BMA and edited by Sir Michael Peckham and Marshall Marinker, was launched on 2nd December. It is entitled Clinical Futures. Its eight authors are among the most distinguished professors in the land. They argue that technological advances and the unravelling of the

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human genome will bring unparalleled opportunities for new treatments. My noble friend Lord Jenkin of Roding—no one could do it better than he—will address some of those issues. However, I wish to give two examples. The first concerns the remarkable developments in the field of brain repair and other parts of the nervous system. Cell transplants for Parkinson's Disease are already being tried experimentally and the authors predict that this field is likely to grow. There could be as many as 50,000 xenotransplants each year to remedy this awful condition. The authors also predict that by cloning sections of DNA genetic engineers will have the potential to produce designer babies, but only for those who can afford it.
This is heady stuff and your Lordships may have more sympathy for those suffering from Parkinson's Disease than for spoilt couples who wish to design their offspring. But that is so often the way things start.
Some noble Lords may remember Lord Trafford who was a Minister in your Lordships' House. Lord Trafford was a renal physician in Brighton. He and I worked together. He was a pioneer of renal dialysis. I remember going to his department and on his wall was a large "60". I asked him what it meant. He said that it meant two things. First, the 60 referred to the number of people he could take on dialysis; and if you were the 61st, that was very unfortunate, because you had to wait either for someone to die or for someone to have a successful transplant. The second reason that he had "60" on the wall was that he would not treat anyone over 60. You had to be under 60 to be treated. In Wales last week I related that to some specialist registrars—junior doctors about to become consultants. They were simply horrified because today we take access to renal dialysis as a matter of course.
The authors of this book are not fantasy merchants. They are not writers of fiction. They are people much respected by the medical and scientific community. They are predicting huge and expensive advances within the next few years. I have not mentioned life enhancing drugs and the pharmaceutical industry since I think my noble friends Lady Hooper and Lord Lyell may refer to them. The question I ask is how we are to absorb those costs if we are to improve the quality of the existing NHS—a much proclaimed aim of the Government—and still maintain its comprehensive nature. Within limited resources, if we improve quality we tend to jeopardise comprehensiveness. If we maintain comprehensiveness, we erode quality.
On Sunday night there was a news item on Radio 4 featuring a pioneering technique for cervical cytology. The Secretary of State said that if the Government's advisers recommended this new and expensive technique, money would be found. I applaud his confidence. But from where is the money to be found? Will it mean that people will have to wait even longer for routine surgery and treatment—a form of rationing well known to the NHS? My noble friend Lord McColl will address that issue and, after all, he is one who has an intimate knowledge of waiting lists. However, I simply point out that at the end of October 1,119,000 patients—that is still 35,000 patients more than the
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waiting list the Government inherited—are waiting for treatment. Ministers are rightly concerned that so many people should be waiting so long in pain and misery. Ministers have spent an extra £417 million on waiting lists this year. Over the past seven months the total list has fallen by almost 119,000. That works out at around £3,500 per patient. Normally the NHS expects to pay around £1,000 for each admission. So I should like to ask the Minister, the noble Baroness, Lady Hayman—I have given her notice of the question—why the Government pay unnecessarily twice or three times the going rate to achieve the outcome they wish.
I have also given the Minister notice of my second question. What has been happening to the number of patients suspended on waiting lists during the Government's waiting list initiative? A month by month table showing the national aggregate of suspensions as a percentage of list size would give a true picture. In the light of this Government's wish to be open and honest with the public, please could Ministers publish the full information and not be selective? We need to see the full picture not just the half the Government wish us to see.
I chose the title of the debate with great care. However, I had to alter my original proposal at the suggestion of the Officers of the House. My language apparently was not parliamentary, or at least was not suitable for a debate title. Originally I started with the proposal: to take note of 50 years of remarkable progress in healthcare. I wished to give recognition to those who over half a century had given their working lives to heal, comfort, and care for the sick. They have been, and are, remarkable men and women. I include not just doctors and nurses but managers, scientists, laboratory workers, paramedics, ward clerks, cooks, cleaners, porters, and so on. The vast majority show great commitment to the NHS and are prepared to give their best day in and day out. When non-executive directors are appointed—people from outside the service—they are universally surprised by the strong motivation of the workforce. But that should not be taken for granted. The title of the debate includes the words "rising expectations"—expectations not only of the public but also of those who work in the service. They expect to have sufficient resources to do the job well—not just money but sufficient colleagues and support staff. They expect the Government, ultimately their employer, to stand by them and support them. But the Government also have to look after the interests of the consumer. I understand why this Government are seeking greater clinical accountability through new—I have to say rather bureaucratic—mechanisms.
The National Institute for Clinical Excellence, the Commission for Health Improvement, clinical governance and so on are all tools for the future. They are heavyweight, some would say oppressive, tools with few incentives or rewards. In the light of the Bristol case, and some of the other high profile cases, I can understand the Government's concern. However, my concern is that while supporting greater accountability the Government should be aware of the very special relationship which exists between the doctor and his or her patient, between the public and the medical

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profession. If that trust is broken, if that special relationship is severed, we shall all be the losers—the public, the medical profession, the NHS and the Government.
I urge the Minister—I know that the noble Baroness is sympathetic and truly understands the NHS—to advocate with her ministerial colleagues a lighter touch and fewer occasions when we hear from the lips of her colleagues the words "heads will roll". Fear is only one way to manage an organisation and in my experience it is a pretty poor motivator. High quality recruits are the lifeblood of any organisation and retaining good staff is essential to its well being.
I wish to move now to the largest workforce within the NHS: nurses, midwives and health visitors. The noble Baroness, Lady McFarlane, will also mention the subject. The RCN constantly reminds us—it is right to do so—that nurses are the backbone of the NHS. They provide 80 per cent. of direct patient care. They spend more time with patients than any other professional group. So we should be very worried that 60 per cent. of employers report current and significant problems in recruiting nurses; that there is a shortage in excess of 8,000 full-time posts across the UK; and that the number of nurses aged over 55 is set to double over the next five years with a quarter of registered nurses in the NHS eligible for retirement in the year 2000. That is a very bleak picture, very bleak indeed. The NHS faces the worst shortage of nurses in a quarter of a century.
With an ever-increasing elderly population, the demands on the nursing workforce will not diminish; they will grow. Already we know that the quality of some elderly care is poor and the Government are seeking to improve that through tighter controls. But it will be fruitless to control a service which is already disappearing from view.
It was a much respected and loved Member of your Lordships' House, Lord Home, who, before he died, wrote:
"To my deafness I'm accustomed,
To my dentures I'm resigned,
I can manage my bifocals
But oh! how I miss my mind".
He was not alone. There are countless thousands who now and in the future share those fears. But their anxieties will deepen if there is not a committed nursing workforce with the skills, expertise and compassion to cope with the last years of life.
The Government are committed to organisational change and we shall be debating that in the months to come. This evening I have tried to address other challenges, longer-term challenges, which need to be thought through if we are to maintain the powerful and much-cherished ethic of the NHS: love thy neighbour and each according to his needs.
My Lords, I beg to move for Papers.
6.21 p.m.
Baroness Pitkeathley: My Lords, I am most grateful to the noble Baroness for giving us the opportunity to debate this important Motion this evening. The noble
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Baroness and I had an extremely productive relationship when she was a Minister and carers everywhere have reason to be grateful for her commitment to that cause.
Other noble Lords will address the scientific challenges which the noble Baroness put to us. I wish to look at matters from the patient angle and I am much more optimistic than the noble Baroness. It is a matter for rejoicing that we have higher expectations of the NHS than we have ever had before and that there is a great deal more focus on the patient than there was in the NHS's early days. However welcome it was 50 years ago, nobody could pretend that the NHS put the patient at its centre. We are now beginning to do that and that will have an effect on how we deal with some of the problems which the noble Baroness set out for us.
Too many people, especially older people, have been content with less than satisfactory healthcare because it is free and they grew up believing that healthcare had to be paid for. Linking that with our anxieties about the demographic time bomb and so many older people in our society means that old people are vulnerable to debates about rationing by age, one of which the noble Baroness brought to our attention.
But the development of the empowerment of the older people's movement and the empowerment of patients altogether, although it may have been slow to develop in this country, is gathering pace. Without any hesitation I should say that that is bound to have an effect on how we deal with patients in the future. It is a cause for celebration that that patient power movement is gathering pace.
That very fact makes us anxious about how we shall deal with the demands that such an empowered patient movement will put upon us. The problem in relation to the doomsday scenario as to how we shall cope with that is that we always view the future with the attitudes and statistics which are available to us now without taking account of the effect of changing attitudes and statistics and, above all, the effect of changing policies. For example, if we had been having this debate in 1951, we should have been in a scenario where the average length of stay in hospital was 45 days. Now it is less than seven days. The noble Baroness will remember during her time in office as a Minister the huge advances in the sophistication of anaesthetics which led to a great improvement in the quality and availability of day surgery, which had its own effect on how we could deal with the huge agenda before us.
The public health agenda undertaken by the Government, the reorganisation of primary care and the development of health action zones will surely have a huge and measurable effect on the health of our nation, as will the increased interest in health within schools, the workplace and neighbourhoods. Similarly, environmental issues—air and water quality and housing—will have an effect and will improve our health.
I wish to focus on a couple of special initiatives with which I have a connection as chairman of the New Opportunities Fund. They are not heavyweight and I certainly intend to ensure that they are not bureaucratic.

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The first of those is the development of healthy living centres. The Government have put aside £300 million for the development of healthy living centres, which are to focus on the wider determinants of health such as social exclusion, mental health, poor access to services and social and economic aspects of deprivation. We shall encourage innovative ways in which to respond to those challenges in order to meet the needs of different communities and groups. We may include projects which deal with community health services, health screening, physical activity, dietary advice, parenting classes, complementary therapy and anti-smoking projects. All of those will inevitably have a positive effect on the health of the community in which they operate.
We shall be inviting applications in early 1999. We intend to have at least 300 healthy living centres and will reach 20 per cent. of the population by the end of 2002.
A similarly important initiative which the New Opportunities Fund will undertake is in relation to cancer prevention, detection, treatment and care. We shall undertake neighbourhood projects which will increase the information available to patients. I am absolutely certain that that will bring about positive health outcomes. The cancer initiative will include how we deal with palliative care and also extremely strong links with the voluntary sector.
I am sure that the primary aim of healthy living centres and our cancer initiative to target people in communities who have the worst health and the greatest health inequalities will have an effect. We are well aware that we are undertaking a huge task, but my board is determined that we shall achieve positive results. I am confident that that, together with other initiatives which are being undertaken to promote health in our nation, will ensure that my optimism is justified in the future and that the NHS will not only continue to provide one of the best services in the world in relation to health but also will be more and more responsive to the needs of patients.
6.27 p.m.
Lord Addington: My Lords, when I looked at the title of the debate and saw that it referred to:
"implications for the National Health Service over the next 50 years",
I was not sure at first that I should speak. Then I decided that there is one area of healthcare in particular which will become increasingly apparent over the next 50 years and which has not been dealt with in the past; that is, sports and exercise medicine.
What has been a rather Cinderella-like service in the past has now become something to which we are paying far more attention for the simple reason that more of us are playing sports. We are playing sports at a higher level and we are asking more of our bodies. Therefore, we are damaging them more frequently in the pursuit of a healthier lifestyle. If you run around, you will fall over and hurt yourself. If you walk slowly and sit in an armchair, you will not injure yourself.
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Bodies can be treated rather like cars. You can run them into the ground and let them fall apart or they can be allowed to rust quietly. The best approach is to use our bodies sensibly and to have the right sort of maintenance available.
The fact is that the NHS is not well suited to helping people in the area of sport and exercise; it was not designed to do so. The National Health Service was designed to stop people dying of x diseases. The great lie to modernisation is that we can only prepare for what happened yesterday and not for what may happen tomorrow. We did not know that there would be this great burst of people taking exercise. On previous occasions I have indulged myself in attacking the lycra culture of the sports industry, where people dance around and say, "Yes, you can be super fit"—and if not you can sit around in the right designer gear in the gymnasium smiling and hoping that your stomach does not start to sag when you walk over to sit on the next machine waiting for a photo opportunity.
That sort of culture seems to be breaking down now and people are beginning to realise that being fit takes graft. Our athletes at the top level are setting incredibly high standards. There is always a trickle-down effect in terms of performance in sport and exercise generally. We are now asking so much more of ourselves at amateur levels in sport.
I must declare an interest, although it is a declining one. I am an ageing rugby player. The nearest I have come to sports medicine was a rather bashed-up knuckle acquired in the parliamentary rugby team. It happened because for once I decided that I would not flatten somebody; I would merely grab him as he passed. He carried on going, and so did my finger. It is a minor injury of the kind that we do not generally take to doctors. Some injuries we will take to casualty—cuts or dislocations—and ask for treatment.
The fact is that people are taking time off work as a result of sports injuries and that has a national economic cost. It is something we must address. One way forward will be by training GPs to recognise the minor levels of rehabilitation and what is required. Every sportsman I have ever spoken to has a story about a GP telling them to rest for six weeks. If a person with a muscle out of place rests for six weeks, at the end of that time he will merely have a weakened muscle which will tear again. That is something about which every sportsman of my age knows.
We need a regular support service. Indeed, two British medical institutions—the National Sport and Medicine Institute and the British Association of Sport and Medicine—have put in place a diploma course for GPs to teach them how to deal with injuries, particularly at junior level. Within the medical establishment we need a Royal College for sports and exercise medicine. It is not just sportsmen who damage themselves; for example, ballet dancers sustain injury with appalling regularity, as do all dancers.
We need people who know about the problems, about the correct forms of rehabilitation and preparation. Unless that happens, our healthier society and the type of maintenance I mentioned earlier will not happen. We

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will continue to see far too many people suffering injuries, both big and small, and ultimately not returning to a healthier lifestyle.
I wish to make one point on a slightly different subject. With the growth in technology in medicine, as in all other parts of society, we are producing better equipment to do diagnostic work. That has one huge potential benefit for one small section of our society; that is, those who have difficulty in expressing themselves. It may be that they have intellectual impairment disabilities and do not have the means of making themselves understood easily to a doctor. I hope that, as the technology improves and comes on line, the Government will seek to encourage GPs to put those people forward for more scans. They will then be able to diagnose the problems. If a patient cannot make himself understood, he cannot tell the doctor what his nervous system is saying and therefore will not receive the right treatment. We have increasing means at our disposal to deal with that problem. I hope that both parts of my speech receive a favourable response.
6.34 p.m.
The Lord Bishop of Ely: My Lords, I am hesitant to add my lay voice to a subject which requires both the expertise and wisdom abundantly possessed by the noble Baroness, Lady Cumberlege, who introduced this welcome debate. In the 50th anniversary year of the NHS it is timely to ask whether the service can still do what it set out to do in 1948. I take seriously what the noble Baroness outlined by way of the difficulties the service will face. I am sorry that I am not speaking after the noble Lord, Lord Jenkin, who will say more on that subject. But I wish to indicate that I take those challenges very seriously.
The National Health Service seems to me to be the practical expression of a big idea. Indeed, it is sometimes said to be the only religious belief of the British people—an exaggeration, but not by much! The idea that the National Health Service embodies, as the noble Baroness said, is a moral one; that is, that it is a good thing when a human being in relievable distress is helped without regard to his or her capacity to pay for that help. That good is not just an individual good; it is a public good. And it is not a public good because that person may subsequently become a contributor to the national economy; he or she may not do so and it is still a public good. It is good for older people; good for people with severe disabilities and good because it is good for us all.
The interesting point about the NHS is that, having established this big idea in a massive institution, the mere existence of the institution teaches us the force of that idea. For all its difficulties, which one of us wants to return to inferior medicine for the poor? What is more, because it is a morally based institution, it attracts the services of men and women who inwardly believe that their life's purposes are best spent in serving it. There is a passion in such service; there is a passionate yes to relieving individual distress where it can be relieved without regard to that person's financial status or aspiration.
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But every institution, paradoxically, has to change in order to remain the same. An interesting article was published in the BMJ which reminds us how limited was the range of treatments available to general practitioners in the 1940s. To fulfil an analogous role in the modern world we have to take account of changes which are not merely medical, but also social. Those two require considerable thought.
If we ask what changes are imposed upon us, I would highlight, first, the matter of persisting inequalities. Those were demonstrated first by the Black Report of 1982 and, more recently, in September of this year in the Acheson Report on Inequalities in Health. That report makes abundantly clear that equity was one of the founding principles of the NHS and it still recommends that a way be found to ensure that healthcare services serving disadvantaged populations are not of poorer quality and less accessible. That is the same tone as was clear in 1948 when the NHS was founded.
Secondly, there is a complicated issue surrounding the matter of trust. Interpersonal public trust was a very different matter in 1948 than it is today. One of my deepest fears for the NHS is the attempt to embrace medical relationships within a contract culture in which everything is costed. If I am right, the moral idea at the heart of the NHS is that of kindness and compassion—as Blake put it, the human face divine of Mercy and Pity. In this idea there is an unspoken covenant between persons; a legal contract is an entirely different matter.
On a recent visit to Washington, I caught sight in the metro of an advertisement for a health scheme. There was a picture of a doctor examining a child and the caption read, "He is making a diagnosis, not a business decision". You would not compose a caption like that unless it addressed a real situation, and for me that situation—I am quite clear about it—is wholly undesirable. When a person gives blood for nothing, that is just kindness; but when the blood is turned into a product and legal dispute breaks out as to who owns it then the implicit covenant between people becomes qualitatively different.
I believe that we all have a role in protecting the NHS of the future from a litigiousness whose first instinct is suspicion and the presumption of bad faith. So modernisation is on everybody's lips, but what I want to hear from the moderniser's own lips is a commitment to the thought that the basic idea of the NHS is a moral one. There are those who in the modern world have actually no moral convictions whatever. They may be kindly people in their own way, but they believe that morality is simply a matter of personal opinion. There are those whose programmes of modernisation amount to covert ways of undermining the fundamental idea, and so there is very hard work for us all to do, making real the big idea in the structural, medical and administrative detail of a great institution which took to itself in 1948 the title "service".
6.41 p.m.
Lord Jenkin of Roding: My Lords, I am very grateful to my noble friend for introducing this debate and I should like to say how much I appreciated her

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splendid speech. Her Motion invites us to look ahead to the next 50 years and I should like to start by taking my text from an article in The Times this morning:
"This therapy will be the medicine of the next century".
When one looks to see what "this therapy" is, it turns out to be a technique that would allow babies to be born with an embryonic "twin" to grow spare tissue and treat life-threatening diseases in later life. The imagination does not merely boggle: it is really very startled indeed. I shall come back to that in a few moments, but what I want to do is to try to glimpse what the future holds as regards the advance of science for the prevention and treatment of disease, together with the promotion of better health. I should like to start with a proposition which I heard about 10 years ago from that great doctor, Sir Christopher Booth, when we shared a platform at a conference in Paris. He said,
"It is a popular view that science has unravelled the mysteries of human health and disease, with a few dark corners still to be uncovered. The truth is the precise opposite. There are a few areas where enlightenment prevails—but most of the rest is still shrouded in mystery".
I think we do well to remember that. The last 50 years, it is true, have seen huge advances: new imaging techniques, new diagnostic and screening methods, new treatments, new drugs—a proliferation of new drugs—new surgical techniques and much more. Of the next 50 years, one thing is absolutely certain: that is that the pace of scientific and technological advance will quicken. In the same way as much medical practice today is totally different from what it was 50 years ago, so we can be sure that by the year 2048—and I doubt whether many of us will be here—much, even most, medical practice will be different again.
The change, as my noble friend mentioned, is being driven, perhaps more than anything else, by the genetic revolution. I am no scientist, though I should declare an interest perhaps as the chairman of the Foundation for Science and Technology. As a non-scientist I have tried to understand what it is all about. I commend to my lay colleagues—and I am sure that the right reverend Prelate will be aware of this—a remarkable book called The Book of Man by Sir Walter Bodmer and Ian McKie, telling the story of the genetic revolution, from the generations of left-handed Kerrs on the Scottish Borders through to the human genome project, calling on the way on the Mendelian laws of inheritance and the double Helix of Watson and Crick.
In the Select Committee on Science and Technology's study of antibiotic resistance, we heard of the work to map the genomes of some of the dangerous pathogens that are becoming resistant to antibiotics and of the hope that this technique might lead to the discovery of the gene which promotes natural resistance. My first question to the Minister—like other speakers, I have given her notice—is: when are we going to see the Government's response to that report, which was published as long ago as last April?
The genetic revolution is prevailing over many areas of medicine and it so happened that the other day I was reading an issue of the New Scientist. In that one issue there were described a large number of new discoveries
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based on genetics. I have referred to the culturing of the human embryonic stem-cells, leading to ways of growing tissues or even organs for transplant. It is this work which, says today's Times, is the subject of a recommendation by the Human Fertilisation and Embryology Authority that the Government should widen the regulations to allow scientists to develop new therapies for diseased and damaged tissues. We seem to be moving along the road to cloning people.
My second question to the Minister is therefore this: are the Government satisfied that it is right that the committee of four experts who have drawn up this recommendation included nobody from the discipline of medical ethics? Is it sufficient to have the imprimatur of the main authority, which does include ethicists? Is that enough to make sure that the intentions of Parliament in this field are in fact being effectively implemented?
In that same issue of the New Scientist we also read of treating heart failure by gene therapy. And so it goes on: gene therapy to grow new teeth; DNA tests to show which drugs will or will not work; and so on. All this is in just one issue of a popular science journal.
How much more lies over the horizon? One has only to read the ABPI's recent publication, An A to Z of British Medicines Research, to see how many of the projects being researched by the drugs industry are based on genetics. One begins to appreciate, when one thinks in terms also of universities, research councils and medical charities, just how profound this revolution is going to be.
And so my last question—and with this I must sit down—is: are the institutions of medical education keeping up with all this? Are the doctors being trained in the new technology? Do continuing medical education and continuing professional development really fit the medical profession for this revolution—because without any doubt the revolution is profound?
6.47 p.m.
Baroness McFarlane of Llandaff: My Lords, I too would like to congratulate the noble Baroness, Lady Cumberlege, on initiating this debate and giving us the opportunity of discussing some profound issues. I might even compete with her on the issue of "blood on the carpet" in her childhood home. My father was a dentist and I can assure the noble Baroness that there was more blood on my carpet! That is a very powerful motivation, I think, for both of us in the view we take of the health service today.
The advances in medical science over the last 50 years are a cause for congratulation as regards the scientific community and the outcome of healthy partnerships between the biological sciences, medical applications and developments in medical technology. It seems sometimes that these advances are proceeding at an exponential rate and we cannot keep up with them. Other speakers have already mentioned the book published by the BMJ entitled Clinical Futures.
I was interested in the heading of the press release in relation to that book:
"The blind may see and the deaf may hear, but society may become less tolerant".

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I think that is one of our fears: that we may tolerate handicap or imperfection less well than we have done in the past. But we applaud the improved quality of life enjoyed by those who have had, for instance, a heart by-pass operation or hip replacement or an infection treated with antibiotics. The relief is often palpable, and very often you can tell the relief from pain from the expression on a person's face. I should like to congratulate all who have been concerned in those advances.
I was told yesterday that information technology itself may well result in greater savings to the health service than medical science. We already see applications of information technology in services such as NHS Direct, which was launched by the Secretary of State last Friday at the Royal College of Nursing. It is a system of telephone triage, advice and referral given by nurses which can bring tremendous savings in the primary care services; but it also means that nurses have to learn new skills. I was going around in my old-fashioned way asking; "How do they advise a patient; how do they assess what is wrong unless they see the patient and unless they can touch the patient?" They have to learn new skills to do that.
It is right that we should pause from time to time and look at what these advances are doing to our National Health Service. In my early days I was taught that one of the major links in the whole National Health Service was the importance of prevention, health education and self-care. I think that the public may increasingly be looking to highly technological care and advances in medical science rather than looking to self-care—looking after ourselves and preventing ill health. I am glad to see that advances are being made in the healthy living centres which are being set up. We look forward to seeing what they will do. I am also glad to see that the public has an increasing recognition of the importance of healthy diet and exercise, even in the Palace of Westminster.
The second consideration that I wish to look at is what the advances in medical science do to other professions, particularly nursing. The noble Baroness dealt with that in wonderful detail. Over the years, I have seen nurses provide a convenient source of assistance to doctors in the conduct of medical research, in the administration and monitoring of complex drug regimes and in the use of medical equipment. As medical advances proceed so doctors tend to become busier and delegate some of their less-skilled tasks to nurses. In turn, the registered nurse becomes busy and delegates some of the caring aspects to the nursing assistant. But now hospital care is so complex and highly skilled that the kind of caring that people need in that setting requires complex knowledge and competency. I would be loath to see too much of the caring in those technological settings left to assistant nurses rather than registered nurses.
I am concerned because so often I hear, both from nurses and the public, the following question: "What has happened to the caring role of the nurse?" Indeed, that was the kind of remark that was fed into the survey of the Royal College of Nursing. The growing emphasis on specialist and technical skill was seen as risking
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alienating patients who hold great store by, "someone to be kind, to tell me what's going on, to be on my side and to hold my hand". I am sure that that is still an extremely important role for nurses in a situation where patients may be very frightened by what is happening to them. So I would commend that we give due care to what happens to the caring role of the nurse as the work of the profession increases in complexity.
6.54 p.m.
Baroness Perry of Southwark: My Lords, I should also like to congratulate my noble friend both on tabling the debate and on opening it with such a knowledgeable and moving speech. I am very pleased that the House is debating the issue this afternoon in such a sense of shared concern for the future of the NHS and its quality, without any political name-calling. Every government come into power with an ambition to improve the health of the nation and to preserve the NHS, of which we are all so justifiably proud. The ways in which these goals are met may differ from one government to another, but I hope that the Minister can acknowledge that the previous government worked hard to improve and protect the National Health Service, just as the present Government are also doing.
As one who is privileged to work in a community among scientific researchers, I should like to take my few minutes this afternoon to celebrate the advances in medical science which have taken place over the past 50 years and the research upon which they are based. Perhaps we should remind ourselves that health provision in the 1940s was largely in the hands of general practitioners. For most people, the family doctor was their major resource, and hospitals were places where you went only if you were very ill. The rising tide of expectation towards more sophisticated medical procedures was still little more than a ripple: most babies were born at home; infectious diseases like scarlet fever and whooping cough were a feature of the lives of children; diseases like tuberculosis and polio took a huge toll; cancer was still a word to be spoken in a whisper, as it carried an almost certain sentence of death; and people over the age of 70 were very old indeed. The childless remained childless unless they could adopt and, crucially, the diagnosis of disease still relied largely on the trained and experienced instincts of the general practitioner, who, with the best will in the world, inevitably sometimes got it wrong.
Today, all that has changed. Any symptom beyond a snuffly cold tends to find the patient subjected, sometimes willy-nilly, to a battery of hospital-based diagnostic tests involving the use of sophisticated and expensive technology. Diagnosis is so much more accurate and early, and thousands of lives are saved by the miracles of radiology, nuclear medicine, brain imaging, MRI, ultrasound and a host of other diagnostic techniques. That essential threshold of accurate diagnosis raises standards across medical practice beyond the wildest dreams of 50 years ago. One of the features of this diagnostic technology is the transparency of the results to the patient. Today, increased information about ourselves and our health is available to all of us as patients. But this is only the beginning.

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We have already seen transplant surgery become an every-day accepted part of life. Now we have developments in bio-technology, which seemed like science fiction only a decade ago, and, as other speakers have said, the cloning of human tissue is this week's new and lively issue. Yesterday, Professor Ron Laskey in Cambridge University announced a new method of identifying cells which are replicating abnormally—a breakthrough in cancer research of huge possibilities.
Indeed, these are things to celebrate. We should give thanks for the women and men of scientific discovery who, working in independent laboratories in universities or in commercial pharmaceutical companies, have provided us with the great leaps of knowledge that make our lives so much richer and our expectations of our own future and our children's future so joyfully abundant. But the funding for such research must continue. "Blue skies" research is the fundamental base upon which all other applied research depends and it will not be funded through private, profit-making companies. It is the responsibility of any civilised government to continue to put money into "blue skies" basic scientific research.
However, those developments, like the contents of Pandora's box, cannot be taken out or put back at will. Once they have been launched they form part of the expectations of an entire population. We cannot go on pretending that these expectations can be met by public money alone. There is already rationing in the National Health Service, and to a degree there has always been. Services provided in the public sector, just like goods provided by the private retail sector, are restricted by our ability to pay, whether as individuals or as a nation.
The health service already generously funds research at regional and national level which bears upon its immediate responsibilities. Could it not be persuaded to direct some of its research into looking at ways in which the service itself could be made more cost-effective, with a detached and long-term view of its future organisation, free of any immediate political imperatives? Perhaps a closer review could be made of the way in which GPs prescribe so readily to all their patients. The expectation that there must be a pill to cure everything from colds and flu to minor mood swings, is one which must be broken. I welcome the Government's emphasis on preventive medicine and on primary healthcare to keep as many people as possible out of the loop of expensive and secondary healthcare. That must be one of the ways ahead.
We value our National Health Service, and rightly so. It exists alongside superb private medicine and I believe that it should continue to do so. The health service is a priceless resource. It has served us magnificently for more than five decades and I have every confidence that it will continue to do so in the future. But all its advances depend on the continued achievement of scientific research, government-funded. The researchers of this country have done us proud so far and they deserve every support in the future.
7 p.m.
Baroness Masham of Ilton: My Lords, I thank the noble Baroness, Lady Cumberledge, for initiating this debate.
Yesterday human spare-part cloning hit the headlines. Will the door be opened to human cloning in the next 50 years? Having seen so many complicated disabilities, one knows how important research is to alleviate serious illness and disease. The fast-developing biotechnology now seems to know no bounds. Scientists have progressed with cloning calves since Dolly the sheep. There is a concern that the development of medical technology has not been accompanied by morality. Life is becoming very complicated indeed.
During the past 50 years we have seen the wonderful development of antibiotics and how they have combated serious infection. But now we are experiencing drug-resistant strains of infection, which means that the superbugs are winning. With the scientific advancement of heart, liver and kidney replacements and the vulnerability of patients with suppressed immuno systems, basic hygiene should not be neglected.
It is difficult to imagine what may happen in the next 50 years, but the world is small and we should not be complacent about infection control. Drug-resistant tuberculosis has appeared in our modern society. Cases of TB are increasing. In the past 16 years we have seen HIV/AIDS appear and that has proved a challenge to the scientific and medical experts.
It is also a challenge to the pharmaceutical industry to find the correct drugs. It is a challenge to the health authorities to provide them. Sexually transmitted diseases such as gonorrhoea and herpes are increasing in many groups. Good health education is so essential.
There are so many fields of medicine which need researching, and the availability of the correct drugs can make a much better quality of life. It seems very unjust that someone with cancer or multiple sclerosis should have his drugs dictated by his postal code. I hope that this will be corrected.
It is most important that the pharmaceutical industry brings out more antibiotics and useful drugs, and that the drugs become available to all those people who will benefit from them. I hope that the Minister will agree that there should be more teaching in medical schools about the importance of prescribing correctly.
I ask the Minister what progress there is on screening for diabetes. Diabetes is a complicated condition and the number of cases is expected to double by the year 2010. Why is this? At the moment, about 123 million people world-wide suffer from diabetes. If diabetes is not detected it can cause strokes and heart disease. People need to know what to look out for and to be monitored.
As president of the Spinal Injuries Association, I should like some assurances from the Minister that people with spinal injuries who become paralysed will get the correct treatment in a spinal injuries unit. Over the past 50 years, this has not only been of great benefit to the patients but cost-effective to the health service. People who become paraplegic, if not treated correctly, can get many complications and cause unnecessary

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expense. If treated in a general ward without specially trained staff, patients are at risk of pressure-sores, sepsis, urinary infection, bowel problems and depression. General hospitals do not usually have the equipment needed. I hope that the Minister will ensure that the 11 UK spinal injury units providing specialist treatment and care receive the funding and support needed to continue their high quality service and improve on co-operation between agencies.
We hear much about a primary-led NHS. I am concerned that the new primary health groups are not fairly balanced. There will be seven GPs, no dentist, no pharmacist and only one lay person. The consumer representation is too weak. The doctors will be away from their patients and will have to find substitutes. With the complex matter of drugs and the cost involved, it is a pity that a pharmacist will not be a full member. If pharmacists are co-opted on to the groups, they will not have voting rights.
Let me end by asking the Minister what is to be the complaint procedure. We have seen the terrible cover-up of cases relating to doctors in Bristol. Having served on a Family Health Service Authority, I know that there can be problems involving doctors and dentists of negligence, alcohol abuse, drugs and sex. Will the doctors be self-regulatory or will an independent body do this work? I hope that the Government get it right as the good relationships between doctors and patients are very important. The public have high expectations of their doctors, but these can be easily damaged if doctors play God and patients feel let down.
7.6 p.m.
Baroness Hooper: My Lords, I, too, welcome this debate and my noble friend's initiative in tabling her Motion.
Earlier in the year we looked backwards to celebrate 50 years of an evolving, ever-changing National Health Service. It is changing because of the amazing and wonderful advances in our knowledge of science and technology; it is changing because of the very natural rises in people's expectation because of the increased information available to them, a point to which my noble friend Lady Perry referred. It is changing because I think we all now recognise that affordability is a factor and that there is not an unlimited pot of money available. So those who have to make difficult decisions on priorities—the Minister will be well aware of that—must be able to do so with the best possible information and data available in order to try to achieve that element of equity to which the right reverend Prelate referred.
These changes are not something which affect us and the National Health Service in isolation. Every country in the world is looking at its health service and seeking better and more comprehensive services within its means. Two weeks ago I was in Argentina, leading a trade mission supported by the Department of Trade and Industry which focused on healthcare. The interest there in how we managed things here made me realise, once again, how the National Health Service is regarded as a model. So we should be aware that what we do and what we plan to do is of interest not only to ourselves but to many others.
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Looking forward in the terms of the Motion before us, I believe that the prospect is very exciting. New frontiers are constantly being challenged, but we also have to exercise caution. Perhaps at this point I should declare an interest as a non-executive director of Smithkline Beecham. In the light of the merger announced today between Zeneca and Astra, perhaps I should say that the rationale behind many of the mega mergers of global pharmaceutical companies is the need to put more and more funding into research and development. There can of course be other synergies, but the cost of and the need for research and development are usually the main driver. Many, many millions of pounds go into exploring ways of making existing drugs more effective and treatment more appropriate as well as into researching new drugs. It is from this background that I should like to focus on advances in genetics. In doing so, I hope to complement what others, in particular my noble friend Lord Jenkin of Roding, have said.
I am not a scientist either but I can grasp that advances in genetics are allowing us to understand the molecular basis of disease. We are starting to be able to determine which genes are involved in quite complex diseases. This increased understanding is revolutionising the way medicines and other healthcare products—for example, diagnostics and vaccines—are being developed. Today, more and more pharmaceutical research and development is based on genetics. I accept that within probably a five to 10-year timeframe this new understanding will revolutionise the way medicines are delivered to patients. We are beginning to understand that any one disease can be made up of a cluster of different conditions which may respond to different medical interventions. In addition, we are beginning to understand why different individuals respond to drugs in different ways. If we are able to determine precisely how to give the right drug in the right dose to the right patient at the right time there will be huge benefits for the National Health Service, for patients, for the Government and for the industry too.
I therefore believe that the National Health Service needs to look at the implications of genetics for healthcare and healthcare delivery now in order to be able to ensure that patients in the United Kingdom reap the maximum benefits from this research when products start to come on line. They are a reality. I hope that the Minister will be able to reassure me in that respect.
When I did my stint as a Minister in the Department of Health I had responsibility for the international side. As I said at the outset of my remarks, the issues raised in this debate are not ones we should consider in isolation. So, apart from co-operation in medical education and research, there are also issues of intellectual property rights, patent protection and indeed ethical and moral considerations which must be dealt with fully and must be dealt with, I believe, at an international level, whether within the European Union, the Council of Europe or the World Health Organisation. I hope the Minister will be able to reassure me that the Government intend to play a full part in that.

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I wish the National Health Service another 50 years of vigorous life and growth and I trust that it will look outwards in doing so as well as forwards.
7.12 p.m.
Lord Rea: My Lords, the noble Baroness, Lady Cumberlege, has given us a very difficult task—six minutes to cover the next 50 years. I am aware that that is not the noble Baroness's fault. In fact this very tight timing, as it has turned out, was not necessary. I shall restrict my remarks to one aspect only: equity of access.
The National Health Service will try, as it always has, to make the best treatment available to all, regardless of social status or area of residence, a point made by the noble Baroness herself and by the right reverend Prelate the Bishop of Ely. Equity was one of the founding principles of the National Health Service. Of course it has not always been successful in achieving this, and middle class people and more affluent areas have managed to carve out a better service for themselves. That was encapsulated in 1972 by Dr. Julian Tudor Hart in The Inverse Care Law.
Things have certainly improved since then but there are still too many discrepancies in the standard of care between different regions and social groups. For instance, coronary bypass grafts and angioplasty are more frequently done in some health authorities than others—up to four times more frequently, I gather—and this variation is not at all related to the prevailing rates of coronary heart disease.
However, I am sure that my noble friend would agree that the overall "Healthier Nation" for which we are looking depends on the best practices being available across the country. Although the National Health Service is not the main determinant of mortality and morbidity rates, which have much wider determinants—I wish we had more time to discuss that point—the National Health Service contributes hugely to the quality of people's lives. A top priority must be the achievement of equal access, not only to expensive high-tech interventions, which usually, but not always, affect a minority, but also to high quality primary and community care and well-staffed and efficient hospitals.
The Acheson report on Inequalities in Health, which we received two weeks ago, states on page 116:
"An inverse care law is still evident in relation to the distribution of medical and nursing staff in relation to need. A number of studies have shown that deprived areas suffer increasing difficulties in recruiting general practitioners and this inequity extends beyond that of GPs to other primary care staff, including practice nurses, health visitors and district nurses".
My noble friend may care to outline how the changes in primary care which the Government propose will affect these questions of equity. It is a safe guess that more benefit to more people will come from bringing the best medical care that already exists in the National Health Service to all parts of the country and to all social and ethnic groups, than by expending very large sums on technical innovations which affect only a few.
However, this is not to deny that scientific advance is not only essential but also inevitable and highly desirable. As the noble Lord, Lord Jenkin, and the noble
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Baroness, Lady Masham, pointed out, we learn almost daily of new and exciting developments. But if, after proper assessment—and the Government's initiative in setting up the National Institute for Clinical Excellence (NICE) and the Commission for Health Improvement (CHIMP) will help this evaluation—an innovation is found to be effective, particularly if it is cost-effective, it should rapidly be made available to all those in clinical need across the National Health Service. There will of course be strong pressure to favour those areas which can most effectively articulate their need—those who shout loudest—but I hope that my noble friend will be able to say that equity will reign and that strong efforts will be made to ensure that those with the greatest clinically measured need, even if they are suffering quietly, will come first.
Of course this will inevitably require increased resources—both achieving equity and accommodating technical progress—but this is right and proper as our GNP rises. In fact, we spend a lower proportion of our GNP on health than any other country at an equivalent economic level. It is worth pointing out that a proportion of scientific advances may actually save money by, for instance, avoiding hospital admissions, or enabling patients to continue working, or by avoiding more expensive forms of investigation or treatment. As new methods and technologies are to be brought in, there must be a culture that allows for the exit of forms of practice that have been shown to be unnecessary or ineffective. Some of these are costly in themselves.
Only this morning I read for the first time the book Clinical Futures. The chapter by Professor Peckham, who was the first director of R&D in the NHS, a post created in response to the report of your Lordships' Science and Technology Select Committee, is particularly relevant to tonight's debate and I commend it to the House. Six minutes is too short to attempt even a summary. But I should like to conclude with his words:
"The future must be seen as an integration of scientific medicine within a broader framework that tackles social and other determinants of health. This is not an 'either or' choice but an absolute requirement if there is to be a balanced approach to health development".
7.20 p.m.
Lord Lyell: My Lords, once again, I am filling in as "tail-end Charlie". It has been a wonderful and stimulating debate. I am immensely grateful to my noble friend Lady Cumberlege for giving us the opportunity to consider the achievements of the National Health Service over the past 50 years and its future prospects.
In opening, my noble friend was kind enough to refer to my noble friend Lady Hooper who sits behind me. However, I heard her also refer to me as "Lady Lyell". I know that there are three others and that miracles occur, but not necessarily in six minutes in your Lordships' House!
My noble friend may remember that in a previous incarnation she asked me to read research material more thoroughly and not to muddle appetite-depressants with contraceptives. She said that I, as a bachelor, might have thought that they were the same. I do not! As I have

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said, I am immensely grateful to my noble friend for giving us this opportunity to look at what she calls the "rising expectations" for the National Health Service over the next 50 years.
In 1948, I was nine years old. I remember being at school where I contracted a disease known as glandular fever. I was told that I was wet, gutless and would be unable to play football or do all the other things which the Ministers' sons do. I managed to come through that.
I am delighted to see that the noble Lord, Lord Addington, is back in his place. Forty years ago, I achieved a spectacular own goal in a town well known to my noble friend Lord Astor. I am delighted to see him joining us on the Front Bench again. I went skiing in a town called Davos and suffered a triple fracture of the leg. The next morning I had immediate surgery. However, something called "complications" arose. I await comments on that from my noble friend Lord McColl of Dulwich, if he has the time. I spent five weeks in Davos Hospital and a further five months in plaster. There were further complications and I spent another three months in plaster in 1960, followed by six weeks in hospital. That was a self-inflicted injury. I have also broken hands, an ankle, and have dislocated my shoulders when skiing. However, all that pales into insignificance, as always in your Lordships' House, when compared with the sheer guts and courage, if I may call it that, of the noble Baroness, Lady Masham of Ilton. We extend to her our admiration. We are delighted that she is speaking in this debate. Following the appalling injuries that she suffered in, I think, 1958 or 1959, she is now just a little slower than normal.
One can have self-inflicted orthopaedic injuries, but I am thinking also of what I call the "self-inflicted injuries of over-indulgence in a normal lifestyle", perhaps in your Lordships' House. I am a Scot and an accountant. I have two remedies. One is called a weighing machine or bathroom scales. The second is the waistband of my trousers. Although I am a Scot, I am not wearing a kilt! Incidentally, I enjoyed the description by the noble Lord, Lord Addington, of the body contours of people wearing leisure suits. My noble friend Lord Astor and I will remember that when the Lords and Commons Ski Club goes out on the second Friday of January to challenge our Swiss friends on a terrifyingly fast giant slalom slope. The noble Lord, Lord Addington, is right, but we lack nothing in application!
How can we get round the problems of self-inflicted injuries in normal lifestyle? I took some advice from the pharmaceutical industry this morning. The noble Baroness, Lady Pitkeathley, quoted some interesting figures about occupation and length of stay in hospital, thus saving me 20 seconds of my time because I shall not have to repeat that. I was fascinated to learn that, according to the OECD medical report, the cost of medicines per head in the United Kingdom is about £86 per year. The comparative figure in Japan is £277. I wonder what the Japanese get up to or what they are gulping down. The figure for France is over £200. According to the OECD, the only nation with a figure lower than ours is the Republic of Ireland, at £77. I call that the "PTAD syndrome". In Ireland it is known as being "partial to a drop". Your Lordships can discuss
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the liquid! However, there must be something in the lifestyle of everybody in Ireland to account for that figure. I do not understand why, but that is some indication of what medicines can do for your Lordships and for everybody in terms of saving the NHS the cost of hospital treatments.
I was absolutely "stunned"—I hope that that is a reasonable word to use—by the speech of my noble friend Lord Jenkin of Roding, which was excellent, even by his own standards. He expressed perfectly what I think is the path of the National Health Service and, indeed, the pharmaceutical industry over the next 50 years. I enjoyed my noble friend's comments about the left-handed cars, but I think that he spells it "Kerr". He will be aware that if my right honourable friend, who calls himself "Ancram", did not have that name, he would be a Kerr. In view of the events of the past week, perhaps he may care to repeat that—certainly, I would.
My noble friend Lady Hooper referred to a massive merger which has been reported today. I understand that the revenues of the two combined companies will be in the region of 14 billion dollars. That compares with a figure of 35 billion dollars for the largest United States company. The same report in the Financial Times advises that the cost of creating what it calls a "blockbuster" drug is 500 million dollars. That compares with the possible revenues, if you get it right, of I billion dollars. Those are the figures with which the industry, which is so well represented by my noble friend, is dealing. My noble friend Lord Jenkin of Roding also referred to the prospects of that industry in terms of science and reviews. I hope that on a future occasion I shall be able to discuss the pharmaceutical industry and its costs, let alone all the pills. I thank my noble friend Lady Cumberlege for giving us this opportunity.
7.25 p.m.
Lord Clement-Jones: My Lords, I add the thanks of these Benches to the noble Baroness, Lady Cumberlege, for initiating this debate and for the typically thoughtful spirit in which she introduced it.
This has been a fascinating debate, covering a broad range of scientific, moral, ethical, medical and, indeed, commercial points. The only slightly worrying part of the debate was when the noble Lord, Lord Lyell, looked directly at me when talking about "over-indulgence" in this House. I wondered whether he had discovered some awful secret.
Clearly, one of the required pieces of reading for this debate has been the BMA's book, Clinical Futures. Some of those medical scenarios fill me with considerable optimism: the fact that genetics and genome research will open up so many opportunities for new treatments and for identifying risk factors; the new scanning techniques which could allow instant diagnosis; and the dramatic improvement in the monitoring of health indicators.
On the other hand, other aspects fill me with gloom. I refer to the fact that because of our ability to "genetically select", we could have less tolerance of those born with disabilities; passive entertainment will

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enhance risk factors for heart disease and osteoporosis; and we shall rely on drugs rather than on a change in lifestyle to counter such risks. All those aspects carry major implications for the health service in the next century.
To those factors we can add a number of other challenges for the NHS which have already emerged, such as increased life expectancy; a shift in emphasis from life-saving treatments to treatments which improve the quality of life—many of them relatively expensive; and a move towards more preventive medicine and even possibly a re-emergence of infectious diseases. As a result of the recent report of the Human Fertilisation and Embryology Authority, to which many noble Lords have referred, we now have in prospect what could amount to the manufacture of human spare parts or "cell nucleus replacement", as I have no doubt that we should learn to call it.
Above all, we are moving into an era of greater consumer demands, from what Professor Rudolph Klein has called the "church" model—a paternalist system, driven by doctors where solely they determine what treatment is received—to the "garage" model, where the consumer takes his or her body in for repair and retains control over what happens to it. The desire—indeed, demand—for more information is a key part of that movement. Patients now have the ability to access information from helplines and the Internet in a way they never had before, which in itself provides a challenge to clinicians, particularly when some of that information is of poor quality.
Those are issues which the Government need to take on board now. The future is already with us. My honourable friend Mr. Simon Hughes, in the debate on the Queen's Speech in the other place, described the key problems of the NHS today as being those of the new three Rs: rationing, recruitment and resources.
I want to take the opportunity today to talk about two of those three. Our healthcare spending at 6.9 per cent. of GDP is lower than that of a great many European countries where the average is 7.7 per cent., but we have the best value health service, as a proportion of GDP, in the world, and we should be prepared to pay more for it. However, there are no great new sources of income. Hypothecated tobacco taxes, as suggested by my party, would make a useful addition to NHS revenue, but would not make a dramatic difference.
Levying charges for health services has been a perennial suggestion ever since the health service was formed. The new road traffic (NHS charges) Act is an attempt to claw back some income for hospital trusts other than through taxation. But there must be a limit to this process. My party rejects any move to hotel-type charges or charges for seeing general practitioners. We believe that the universality of the health service must be retained. Just to stand still, however, the NHS needs a real income increase of at least 3 per cent. a year. At the end of the day, whatever taxation policy is adopted and whatever additional money the Department of Health manages to wring out of the Treasury, we have to accept that there will always be rationing at the edges.
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As new developments emerge, there will never be enough money to fund every treatment or test or procedure.
As anyone knows who is close to the health service, whether as professional or patient, rationing decisions are being taken every day of the week. Many noble Lords have mentioned that. However, government Ministers claim that that does not happen. The Conservatives, after 18 years of denial when in government, have finally acknowledged the problem now they are in opposition. Miss Widdecombe has ironically called for a mature debate on the subject. The Government, on the other hand, believe that problems will not arise if we set up enough new bodies—such as NICE and the commission for health improvement—to ensure that new treatments are clinically effective. We should put our faith in what is called evidence based medicine and the necessary resources will be found. That was very much the tenor of the previous government's response to the 1995 Commons Health Select Committee which called for a new national framework.
However, we on these Benches believe that we have to acknowledge and tackle the problem. We need to understand what people's expectations are and what responsibilities they and the NHS have. As Professor Klein says, the fact that no patient under the current system has a legal right to specific treatment means that the clinician decides what the patient needs and political problems are in effect converted into clinical problems. It is time that politicians grasped the nettle.
The NHS is currently one of our best loved institutions. There is still a high degree of trust. Recent developments, however, whether it is the publicity surrounding new so-called lifestyle drugs such as Xenical and Viagra, or cancer patients being unable to get access to a number of treatments involving Taxol and Taxotere which can prolong life for up to 14 months, or the fact that schizophrenia patients are unable to obtain Clozapine and other atypical anti-psychotic drugs, have all highlighted the rationing issue. Postcode rationing is no longer a surprise but a fact of life.
Above all, it is cases like that of Child B. Jaymee Bowen, described in the recent study by Chris Ham for the King's Fund, which starkly illustrate the need for a properly informed public debate leading to public and transparent policies. We cannot just muddle through relying on the occasional blustering edict from the Secretary of State. It is becoming increasingly obvious to the public that if the Government have ruled out increased taxation, not all treatments can be funded. They perceive that rationing is taking place.
If the basis of that rationing is not made clear, trust in the NHS will inevitably be eroded. Polls have made it clear that there is already a level of cynicism with regard to the NHS, its ability to deliver services in the way that it has to date, and even its ability to survive the next 50 years. We need to make sure that new clinical developments are seen as an opportunity for the NHS, not as a threat.

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I know about the kinds of clinical decisions that have to be made. My late wife fought a battle for five years with ovarian cancer. She was also a doctor and one of the lucky ones. In those days, the late 80s, because hospital consultants took the rationing decisions, she was able to take advantage of every new treatment as it came along in case it provided a long-term cure. In the time that she was kept alive she founded CancerBACUP which since then has helped hundreds of thousands of cancer patients with information and support. That was 1987, before the health service reforms of 1991. I wonder what would happen now. As we speak, on cost grounds cancer patients are being denied the drugs that would certainly prolong their lives. Whatever decisions are made, they should be transparent and they should be taken with the fullest public knowledge and consent. We need to get the balance right between individual clinical discretion and national priorities.
We on these Benches propose a national standing conference. However, its role would not be to determine a core package of healthcare to be available. The key role of such a standing conference should, I believe, be advisory and not prescriptive. Its role would be to establish a clear set of values and guidelines to clarify the decision making process which would then be applied by local health authorities, trusts and GPs in order to ensure that patients are entitled to equal and consistent treatment; and to ensure that they are given clear treatment options and proper reasons where treatment is denied by the decision makers themselves, and long-term counselling for families affected by decisions not to treat. It is not a question of precisely which services are provided, but how decisions are made and who takes them.
A new NHS charter could be part of this equation. We should give proper consideration to the report of Greg Dykes—for whom I have a considerable regard—but any priorities or charter decided by the standing conference must have legitimacy. It cannot just be drawn up by one man, however able. No rationing solution is ideal, but I hope that the Government will take the opportunity to acknowledge and to tackle the issue in the new modernisation of the NHS Bill.
7.35 p.m.
Lord McColl of Dulwich: My Lords, I, too, wish to thank the noble Baroness, Lady Cumberlege, for drawing our attention to this important subject. In considering the rising expectations and advances in medical science and how they will impact on the NHS over the next 50 years, I would like to discuss two serious issues which have surfaced recently and which threaten those rising expectations.
The first involves some worrying developments in the postgraduate training of doctors. If this training is undermined, the NHS clearly will be in jeopardy. As I am sure noble Lords are aware, the average age at which doctors qualify in this country is about 24. If they wish to specialise in hospital work, they then embark on a 10 to 17 years' training programme before they are appointed consultants. If they fail to secure a consultant post after this period of time, there is nowhere for them to go in this country because we have this huge
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monopoly employer, the National Health Service. They either have to leave medicine or to start training in some other speciality. That, again, may take many years.
I am not suggesting for a moment that everyone who trains to be a consultant should automatically secure such a post, but there has to be a sensible relationship between the number we train and the number of vacancies that will be available at the end of their training. In a debate in your Lordships' House last week the noble Lord, Lord Winston, drew attention to the plight of trainees in obstetrics and gynaecology where far too many have been trained and the number of consultant posts has been reduced. There soon may be as many as 200 fully trained personnel waiting for consultant posts with little hope of ever achieving that status.
The present junior staff training scheme was devised by Sir Kenneth Calman and should have been implemented many years ago. In criticising the present state of affairs I am well aware that it is easy to criticise and to make speeches about a subject without doing anything to help. I would like to point out that the present training scheme was based on a surgical training scheme which I introduced into the south-east region in 1972 which ran for 15 years. It was based on the principle which was later adopted by Sir Kenneth Calman whereby trainees were taken in for complete training. They were given the security of knowing that they could stay in the programme until they were fully trained provided their progress was satisfactory. Half the time was spent in district general hospitals, half in teaching hospitals, with the possibility of a year abroad. The idea was to enable the trainees to do all their training from one centre so that their families could settle in one district and not have to move around the country. This greatly improved the quality of life of the trainees. In order not to train too many consultants for the number of posts available, half the trainees were from the Commonwealth and returned to their own countries at the end of the training programme. The other cardinal feature was that no new trainees were taken on until those at the top had found permanent employment, provided that their progress was satisfactory and that they were making a serious attempt to secure a consultant post.
A major defect in the present programme is that when the trainees come to the end of their training they are replaced by new trainees, who start at the beginning. As we are dealing with a monopoly employer, there is nowhere for those trainees to go. It is clearly an unsatisfactory state of affairs. I do not seek to blame anyone; I certainly do not blame the Government. However, the question arises as to who authorises the advertisements for the new posts. I suspect that it is the postgraduate deans who are ultimately responsible. Whoever it is, will the Government encourage them to stop advertising for new trainees and simply continue to employ the present trainees until they secure permanent appointments? It seems obvious, does it not?
Furthermore, will the Government give urgent attention to increasing the number of consultant posts in obstetrics and gynaecology to restore them to their previous number? There has been a cut in the number

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of consultants over the past year or two. The Government are to make available some £20 billion of extra money. Could some of it be used to create more consultant posts, as originally planned? Apart from that being a reasonable and humane solution to a major problem, it might also save the NHS many hundreds of millions of pounds in huge legal settlements made by the courts as a result of alleged mistakes in medical practice, which are made more common by gross under-staffing. There are fewer consultants per head of population in this country than in any other European country. We desperately need to create more consultant posts. I hope that the Government will reverse the cuts that have occurred over the past year in the creation of new posts. We owe it to patients, junior medical staff and medical students.
In this country we are very fortunate in the quality of the younger generation in medicine. Their academic standards, professional expertise, kindness and service to patients is better than it has ever been. And their sense of humour is as good as ever. A professor of forensic medicine was lecturing students on homicide and gunshot wounds when he suddenly mentioned that he was worried about becoming senile. He said that he had an agreement with his wife, also a forensic expert, that she would arrange a shotgun accident to carry him off if she saw any signs of senility in him. A student at the back of the lecture theatre shouted out: "Left it a bit a late, hasn't she?".
The second subject to which I wish to draw the attention of the House is the way in which morale is being undermined by an obsession with reducing the numbers on waiting lists. For 20 years the Labour Party campaigned to discredit previous Conservative governments over their handling of the NHS, pretending that they were privatising it, destroying it and greatly increasing the number of people on the waiting lists. They set great store by their claim that they would reduce waiting lists. Unfortunately, last year the lists started to rise dramatically, so they began a campaign to reduce them again.
It is an interesting campaign. It consists of a number of fiddles. The first is to transfer patients from the main waiting lists to subsidiary waiting lists which do not appear in official returns to the Department of Health. Therefore those patients do not appear in the waiting list statistics. That little game began in June 1998, interestingly at exactly the same time as there seemed to be a reduction in the waiting lists. Bradford Hospital NHS Trust has been told that orthopaedic patients waiting for the removal of internal fixations (pieces of metal and so on) are to be included on a new list and that that is not to be included in the official waiting list statistics.
The second fiddle is to have waiting lists for the waiting lists. There are increasing delays for patients simply to have their name put on a waiting list. That slows the rates down, hence making it appear that there is a reduction. Some consultants are holding fewer clinics, so fewer patients are being seen to be placed on
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a waiting list. Frenchay Healthcare Trust has almost a two-year wait for an appointment to see an orthopaedic surgeon.
The third fiddle is that some patients are being denied operations altogether: for varicose veins, sebaceous cysts and lipomas. The people of Bermondsey are very angry that they are having to pay hundreds of pounds for operations to be done privately which until recently were available on the NHS. Will the Government put that matter right?
The fourth fiddle is to encourage simple procedures being carried out ahead of more serious ones, thus reducing the numbers on the waiting list. It means that those with serious conditions wait longer. The Government's own figures show that the list of those who waited more than 12 months has more than doubled, from 31,000 to 63,000. One of the great contributions that Virginia Bottomley made to the NHS was radically to reduce to under a year the waiting time for almost all patients. She ought to receive credit for that.
The fifth fiddle is an aggressively repeated inquiry as to whether a patient still requires treatment. It includes a new method of including targets for a number of patients to be removed from lists.
These techniques are not good for patients. They undermine morale. They are not good for the caring professions. It is an extraordinarily demoralising exercise. Could the Government see their way to admitting that perhaps they have indulged in a little propaganda over the past 20 years? Will they admit their mistake and try to put matters right, and stop the fiddles?
These problems are pertinent to rising expectations for the future of the NHS. I have never really considered the main problem of the NHS to be a shortage of money. The major problem is one of decline in morale, not only among those who work in the NHS but also among patients.
7.47 p.m.
Baroness Hayman: My Lords, I am grateful to the noble Baroness for introducing what has been a fascinating debate. Perhaps I may respond to the tenor of the majority of comments rather than that of the contribution of the noble Lord, Lord McColl. I am afraid the noble Lord repeated allegations and slurs that are completely untrue regarding this Government's record in terms of finally turning the tide of rising waiting lists that we inherited.
Without going through each point of the noble Lord's remarks, I can tell him that there has been no change whatever in the basis on which statistics are collected. That has been made absolutely clear in correspondence. I was particularly upset to hear the noble Lord repeat the allegation against Bradford Hospitals NHS Trust. It has caused great concern to the staff working there. The chairman of that trust specifically wrote to the Leader of the Opposition, Mr. Hague, asking him not to repeat allegations that the figures were being fiddled in any way.

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I do not want to take up too much of your Lordships' time dealing with what tend to be party-political points in a debate that has been far more wide-ranging.
Lord McColl of Dulwich: My Lords, I am grateful to the noble Baroness for allowing me to ask one question. What am I supposed to say to the people of Bermondsey who are angry that they cannot have their operations for varicose veins, sebaceous cysts and lipomas done on the NHS when always in the past they could? Please will the Minister tell me what I am supposed to say to them?
Baroness Hayman: My Lords, the noble Lord is supposed to say that the priority given to certain procedures, particularly cosmetic procedures, is a matter for local decision-making. That has always gone on within the NHS. The noble Lord, Lord Clement-Jones, pointed out how important it is to have processes that are clear, explicit and transparent for priority-setting within the National Health Service. We have to recognise that we are all setting priorities, particularly in times of rising expectations—as the noble Baroness points out in her Motion—and when we are looking at a variety of new things that it is possible for us to do. We are improving the service available to patients year on year.
Returning to the spirit in which the noble Baroness introduced her Motion, everyone who spoke paid tribute to the work of the NHS. I think I am the third noble Baroness to admit to having a father who joined the NHS at its inception. My father, too, was a dentist and I, too, had blood on the carpet. That makes three of us; perhaps that is what made us end up in politics!
This evening is an opportunity to recognise, and pay tribute to, the achievements of the NHS over the past 50 years and to say a little about what the Government are doing to address the issues and to ensure that the NHS is fit to meet the exciting challenges of the next 50 years. My noble friend Lady Pitkeathley rightly reminded us that, while for many of us the NHS is a fact of life, for many older people the grief and worry that paying for care meant to so many is still with them and still affects the way in which they make demands upon the service. The NHS lifted the burden of anxiety about ill health which so affected previous generations. It was one of the best civilising endeavours ever undertaken by a Labour government on behalf of the people. It has been applauded abroad and cherished at home as part of our nation's fabric.
It is cherished for the reasons highlighted by the right reverend Prelate. It symbolises the right of an individual to the dignity of healthcare based on need and not on wealth. It is a tangible experience of what we mean by "community"—working together and paying taxes together to create and sustain a service in the interests of every individual within that community. I agree with him that the NHS has at its heart a moral imperative, even if perhaps not a religious one.
Over 50 years the NHS has transformed the delivery of healthcare and helped to bring about a dramatic improvement in the length and quality of life enjoyed by millions of people. National immunisation programmes
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ensured that killer diseases such as polio, smallpox, TB, and diphtheria were conquered. There has been an 80 per cent. reduction in the number of children dying before their 14th year. Life expectancy is up for men from 66 years to 75 years and for women from 71 years to 80 years. People are attached to the NHS not just for sentimental reasons but also because they know it works—although I have to say to your Lordships, after two weeks of spreading coughs and sneezes across the Floor of the House, that there are still those dark corners that scientific research has not yet penetrated!
However, our pride in the achievements of the past 50 years does not mean that we should stay in a system in which we recognise no need for change. There are enormous challenges. We have set ourselves targets and ambitions for the next 50 years which are challenging in the extreme. We aim to improve health, to tackle inequalities and to modernise services. If we are to do that and to keep up with the advances in technology and the scientific challenges to which so many noble Lords have referred today, it is essential that we not only look at technological advance but also tackle the root causes of ill health and the inequalities in health status that were highlighted by the right reverend Prelate and my noble friend Lord Rea.
I listened carefully to the debate. There were many references to the demands that would be made on the service and the need for extra resources to meet those demands; but I did not hear as much as we could have heard about issues of prevention and improving health, thus reducing demand. In particular, the programme that the Government will shortly set out for reducing smoking and tobacco consumption is a prime area in which we can reduce the need to spend money as well as the terrible toll on individuals and families caused by the effects of smoking.
It was right that the debate inevitably dealt with some fairly challenging scientific concepts. The noble Baroness, Lady McFarlane, rightly reminded us not only of the need to ensure that the professionals who work within the health service have the skills, training and education to meet the much more demanding tasks that we ask of them but also that in the emphasis on a more highly trained nursing workforce it is important that we do not lose our recognition that care and human contact are a vital part of training. The same is true with regard to the point made by the noble Lord, Lord Jenkin of Roding, about the need to ensure that the training of medical students recognises the enormous challenges and changes that there will be in the science base on which they are working. That is an important area for medical education to address. In addition, we need to ensure that the ability to communicate with patients is included in the medical education curriculum to deal with the rising expectations of a better informed patient base, a point referred to by my noble friend Lady Pitkeathley.
There has been much talk about the clinical futures laid out in the book produced partly by the British Medical Journal. I was involved with that and attended the conference for the launch of the book. This gives us immense possibilities. If we put on our "retrospectoscopes", we could all predict that there will

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be enormous change, but not what that enormous change will be. How the human genome project translates into service demands and possibilities is something that we do not know, but we know that we need to know. The work being done by the MRC and the NHS R&D programme are important ways of addressing some of the implications.
I should like to emphasise the point made by my noble friend Lord Rea that we too often tend to see new technology as simply an extra cost pressure. We should see it first and foremost as an opportunity to benefit patients and to provide better services for them, and we should welcome it on that basis. However, we have to recognise, too, that all kinds of advances have given us the potential to spend more money on drug interventions. For example, we discussed yesterday the new and improved treatments for schizophrenia, which seem at first sight to be more expensive but which, when looked at in the light of reduced costs in terms of hospital admissions, can produce cost savings. The same is true of some of the ulcer treatments which have replaced surgery. There are many opportunities, too, in diagnostic advances, such as the possibilities that MRI has brought in replacing the need for arthroscopies. There are many opportunities for the new technology to allow us to manage conditions better and more cheaply in the community. It is not all doom and gloom. There are enormous possibilities.
A number of references were made to the recent report on the possibilities of the therapeutic applications of cloning. That report by the Human Genetics Advisory Commission and the HFEA has only just been published. Ministers will want to look very closely at its conclusions and recommendations, and their implications, and will publish their response next year. I restate that Ministers have made clear that they regard the deliberate cloning of humans as ethically unacceptable. The report recognises that the current legal safeguards are wholly adequate to forbid human reproductive cloning in the UK.
There are still major challenges about possible therapeutic applications. I accept that there are wider social and ethical implications, as well as scientific ones, that need to be addressed. That point was also made by the noble Lord, Lord Jenkin of Roding. The Human Genetics Advisory Commission chaired by Professor Sir Colin Campbell has given a high priority to consideration of these issues and has been in discussion with major funders in this field, including the MRC, the Wellcome Trust and the Department of Health.
Substantial reference was made by implication, and directly by the noble Baroness, Lady Hooper, to the need for evidence-based research to help to translate some of the new developments into applications within the health service. I should like to reassure the noble Baroness that the focus of the NHS R&D programme is very much on the applications end, that is the "D" rather than the "R" side of this work. We shall play our part in promoting appropriate research and try to ensure that there is the correct balance between blue sky research,
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albeit thematically based, that organisations like the MRC can undertake and the more applied research in which the NHS R&D programme can take part.
Noble Lords referred to the increasing expectations of society and among users of the health service. We should welcome the legitimate desire for more information. It demands a different model of decision-making as to the pattern of care and greater emphasis on partnership with local communities—I believe that that will be reflected in health improvement programmes—but also a different model of care from some members of the medical profession whose education was very different and related to a patient base that was much more deferential and not as well informed. I believe that better information can help patients make fewer demands on the health service. Perhaps a prime example of that is the prescribing of antibiotics. Better information can allow people to understand why general practitioners may not give a prescription for antibiotics both in their interests and in the wider interests of public health.
Our responsibility—it is one that the NHS information strategy will take on—is to ensure that patients have access to well referenced and reliable sources of information to allow them to take informed decisions in partnership with their clinicians. Another example of that is NHS Direct to which the noble Baroness, Lady McFarlane, referred. It demonstrates in its initial stages how the provision of the correct advice, with the technological back-up that is available to nurses who give it, can direct patients to the most appropriate services. Sometimes it may be a matter of confirming that people's conditions can be managed at home. But there is also evidence that sometimes it may be a matter of persuading people that it is better to seek emergency help because that is what is required. A service like NHS Direct can have an enormous effect upon the mismatch between understanding the symptoms and the appropriate response.
The trends in expectations and scientific developments exert extra pressure on resources. We have faced up both to the need for extra resources and the need to get better value from what has been invested. We have announced plans to spend an extra £18 billion on the NHS in England over the next three years on top of the £2.25 billion that has already been invested since we came into office. This represents the biggest cash injection in the history of the NHS and gives a stable base for longer-term planning. But this massive cash injection is targeted on change; it is an investment in reform to ensure that patients everywhere get the high quality care that they deserve. There are three elements to ensure that that happens. The crucial element has been referred to in tonight's debate: to make sure that the NHS provides cost and clinically-effective interventions. That is why the National Institute for Clinical Excellence will be very important in assessing and providing information on the cost-effectiveness of existing technologies as well as new ones. It is very important that we take on the task of seeing what is new and needs to be introduced and assessing what has not been effective in the past and stopping it to free up resources to do what is better. National service

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frameworks will be of enormous importance both in terms of producing better evidence and giving guidance on best service configurations and clinical standards.
Time is marching on and I must end. I recognise that I have not answered some of the specific questions that have been asked. Perhaps I may write to noble Lords about those. I end by saying that high expectations are important for our public services as they are important for our children. We should not shy away from them, and we as a government are willing to meet those challenges.
Baroness Cumberlege: My Lords, I understand that the debate has run its course. I never cease to marvel at the expertise and knowledge that are embodied in your Lordships' House, and tonight has been no exception. I thank all noble Lords for debating these difficult issues. In particular I thank the Minister for her very thoughtful and comprehensive reply. I wish her good health. In the interests of a good appetite and a hungry stomach, I conclude the debate. I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

Organophosphate Sheep Dips
8.8 p.m.
The Countess of Mar The Countess of Mar rose to ask Her Majesty's Government what is their response to the report of the Royal College of Physicians and the Royal College of Psychiatrists on organophosphate sheep dips.
The noble Countess said: My Lords, it is with a heavy heart that I rise once again to question Her Majesty's Government on their policy for the diagnosis and treatment of those who suffer ill health as a result of exposure to organophosphate pesticides and veterinary medicines. On 11th July 1996 as a result of repeated requests from me and from others working in this field, the noble Baroness, Lady Cumberlege, then Under-Secretary of State, Department of Health, responded to a Starred Question from me. She announced that the Presidents of the Royal Colleges of Physicians and Psychiatrists had agreed to set up a working party to review the possible long-term adverse effects of exposure to OPs. It was not until 22nd April 1997 that the terms of reference and membership of the working party were announced. Frankly, I was appalled. The title of the working party limited the review to OP sheep dips, whereas my Question and the response of the Minister had implied no such limitation. The terms of reference were extraordinarily restrictive.
The working party comprised 11 members. One of them, Sir Colin Berry, chairman of the Advisory Committee on Pesticides responsible for licensing OP products and a member of numerous other scientific advisory committees, has publicly stated that those who attribute symptoms to exposure to toxic chemicals have a
"desire for attention, the comfort of being able to abdicate responsibility for one's failings by ascribing them to an illness, the luxury of receiving therapy, the excitement added to a humdrum life by weird beliefs about one's past, the propagation of stories
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produced by hysterics by the mass media, the attempts by therapists to push their clients into revealing multiple personalities, non-existent sexual abuse and even alien abduction in the mistaken belief that such revelations may effect a cure".
How does that description relate to farmers?
That statement immediately aligns Sir Colin with another two members of the working party, both psychiatrists; namely, Professor Anthony David, who works with Professor Simon Wessley at King's College Hospital, the promoter of this profound assessment of sufferers of complaints such as ME, multiple chemical sensitivity, fibromyalgia and even Gulf War illnesses, and Professor Hawton.
Dr. Bateman is chairman of the Medical and Scientific Panel of the Veterinary Products Committee. His past record appears to indicate that he has an interest in preventing the admission that OP products have harmful effects on human health. Professor Thomas is also a member of the Veterinary Products Committee. To have five working party members whose credentials are perceived to include a bias that OPs are safe does not fill one with confidence. There was no representative from any of the support groups on the working party until after they met on 22nd June 1997.
Who was responsible for setting the terms of reference? The second of the terms of reference was redundant simply because the working party included members of both the Veterinary Products Committee and the Advisory Committee on Pesticides. They would be expected to report back to their respective committees as a matter of course. Additionally, as this was a clinical matter and the chief medical officer had asked the presidents of the Royal Colleges to set up the working party, should they not have reported to the Department of Health? As will be seen later, the working party made little attempt to address itself to the third of the terms of reference.
I made my concerns known to their chairman, Professor Newsom-Davis, to the Registrar of the Royal College of Physicians, Professor London, and to the Minister for Public Health. I was assured that the members would make an unbiased assessment. I now see that my initial suspicions were correct. This report is a very unpleasant sugared pill.
I am not in the least surprised that those individuals listed on page 51 of the report declined to give evidence. They have, to my knowledge, more experience than any in the UK in dealing with farmers and others exposed to OPs. They also have had many contacts with scientific advisory committees on this subject. They were right not to sully themselves with this report. My initial instinct was also to refuse to present my evidence but, as I was partially responsible for the set-up, after considerable thought, together with the assurances I had been given, I agreed to meet the working party on 22nd June 1997.
This is a short report which, on the face of it, appears to be good for the sufferer. We are told that,
"the symptoms and distress are genuine; that the initial consultation requires sympathetic handling, and that the patient's symptoms must be treated seriously".

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Good! That is just what is wanted. Noble Lords should read on:
"Specific symptoms, such as depression, fatigue, sleep disorders and suicidal thoughts should he managed vigorously in the usual way: for example, antidepressants as well as cognitive behavioural techniques to counteract subsequent behaviours which may develop in the aftermath of an acute illness and serve to perpetuate it".
This is straight from what is becoming known as the "Wessley School". The same recommendations were made in the now notorious Royal Colleges' report on ME and chronic fatigue syndrome. Any GP reading the summary (how many read beyond the summary?) will receive the strongly implied message that the patient has a psychosomatic illness.
It is acknowledged that existing clinical services for this group of patients are unsatisfactory. OP sufferers know this. That is why I asked the original Question!
I now go to the body of the report. Section 2 deals with the current knowledge of the toxicology and toxic syndromes associated with OPs. Section 3 covers the written and oral evidence received from patients and patients' groups. These are factual and I find little to quarrel with, though in Section 2 there is no mention of synergistic or potentiating effects of combinations of chemicals or medication. For example, phenol, which used to be used with OP dips, is now known to potentiate the effects of OPs, and there is some evidence that cimetidine, prescribed for gastric ulcers, may have a similar effect. Nor is there any mention that children, the immunucompromised or malnourished individuals may be more susceptible to OPs.
In Section 4 the working party analyses the clinical symptoms. Contrary to early replies to my Parliamentary Questions, they acknowledge the consistent pattern of complaints they discerned from the accounts of witnesses. They note that "Dipper's Flu" has not been used as a measure of mild acute poisoning. This is a group of symptoms commonly reported in affected farmers. Why do they not appear in the following section on diagnosis and guidelines? Here we get the first indication of the direction the recommendations are to take. Sections 4.5 and 4.10 link symptoms of OP exposure with affective disorders. I acknowledge that these are present, but they are not the only symptoms. Not all those affected suffer from depression.
In Section 4.9 the group blithely reject the concept of multiple chemical sensitivity on the grounds that most authorities reject its validity for lack of evidence. In 1987, Cullen, in his book Workers with Multiple Chemical Sensitivities, wrote:
"The health problems of workers who react to low levels of environmental pollutants and chemicals, increasingly reported and recognised in recent years, has (sic) posed a serious dilemma for health providers from a wide array of disciplines, including generalists, internists, family practitioners, allergists, psychiatrists, social workers and frequently occupational physicians and nurses. The inability of these professionals to provide satisfactory care from the patient's perspective has led to the emergence of new and alternative clinical theories and approaches, challenging clinical view. Unfortunately, the success of these alternative approaches has not been demonstrated, fuelling the ever-widening and hostile debate
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in which the patient is held hostage and virtually all clinicians are rendered impotent because of widely-known intraprofessional disagreements".
Since then the debate in the USA has widened and many US government and state agencies make provision for people who suffer from MCS. The Environmental Protection Agency has initiated its own in-house study to characterise the condition and plans to conduct chemical challenge studies in the future. I look forward to the outcome.
The working party recognises many of the problems OP sufferers have encountered when they approach the medical authorities. My quotation from Cullen applies equally to Section 5.2. I am pleased that it acknowledges the support provided by the self-help groups, though this is somewhat tempered by the remarks in Section 7.7. I have first-hand knowledge of most of the groups in this field and am aware that they are generally very careful in their handling of inquiries from sufferers and their families.
I have found environmental medicine extraordinarily helpful, as have many others who have been exposed to OPs. Rosenthal summed up the reason why there is currently no objective evidence-based justification in 1994. He said:
"We are in a Catch-22 situation. It is difficult to attract research money for a controversial condition and it is difficult to resolve the controversy without the necessary research".
May I ask the Minister to think on this? On numerous occasions I have asked her predecessors for advice and funding for this research, to no avail.
Perhaps the working party should refer to the MoD on the subject of anaesthetics. In its Medical Manual of Defence against Chemical Agents, published in 1987, it states:
"On basic principles the action of anticholinesterases, including to a lesser extent pyridostigmine pre-treatment, may be expected to potentiate the action of depolarising relaxants such as succinyl choline, but to oppose the action of non-depolarising relaxants of the current type".
The working party's recommendations begin at Section 6. My filing cabinets are full of correspondence relating to the total failure of both the HSE and the National Poisons Information Service to help the victims of chemical poisoning. May I ask the Minister how Her Majesty's Government propose to rectify this situation in order to restore peoples' trust in these organisations? May I also ask her how they intend to ensure that practitioners are made aware of the range and seriousness of the symptomology associated with exposure to OPs?
Section 6.7 I find somewhat puzzling. It appears to be saying that, as the results of testing for urinary metabolites may be inconclusive, occupational groups may be forgiven for presenting late with clear histories of over-exposure to OPs. As a result of this late presentation it may have developed fixed ideas about symptoms attributable to exposure. In medicine I understand there is a teaching: "Listen to the patient, he is telling you the diagnosis". I wonder whether there is a danger of patients being mistreated as a result of the over-reliance on a psychological or psychiatric diagnosis when what we are looking at is new disease?

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After all, it is not so long ago that multiple sclerosis was described as "the idle man's disease". I also wonder whether the recommendation that the temptation to over-investigate should be resisted on the basis that many of these patients are not found to have abnormalities could be because the right tests are not being conducted in the first place.
The first four paragraphs on management in Section 7 are very sensible. The last sentence of paragraph 7.4 is of course the basis of informed consent. The injunction that the patient should feel believed and listened to should have been stronger. It is vital that the patient not only feels believed but that he is believed.
Why should the doctor and patient accept the limitations of scientific knowledge? Who is to say that their searches are likely to be futile. They may well, between them, come up with the answer. I simply ask whether we would have been able to cure TB, eradicate smallpox, prevent the infectious diseases of childhood or establish the link between asbestos and lung disease if the medical practitioners of the time had accepted the limitations of scientific knowledge. After all the evidence the working party heard and read, where is its natural curiosity? It repeatedly mentions that there is a lack of causality, yet it makes no recommendation for causal research. Is this because it is outside its terms of reference, or does it not wish to know?
The passage on the treatment of specific symptoms deals only with the affective disorders mentioned earlier. There is the inference that the pain, weakness and incontinence described by so many sufferers are "all in the mind" and can be cured by cognitive behavioural therapy. Could it not be that there is a chemical cause to the mental symptoms? This might explain the reported findings that some people have said that they have had unpleasant side-effects from antidepressants and other drugs. Is it not equally unreasonable that patients should be experimented upon with a range of antidepressants as that they should be referred to too many specialists? This section has clearly been written by the psychiatrists as there were no clinicians practising in other specialties on the working party. It is also almost a straight lift from the Royal College's report on ME/CFS.
In paragraph 7.7 and in the last sentence of paragraph 7.8 we come to the nub of the problem. It is the far-reaching implications for the pesticide industry, for the Armed Forces, the Ministry of Agriculture, Fisheries and Food and the Department of Health, together with the financial and occupational implications which are the working party's prime cause for concern. Antidepressants and cognitive behavioural therapy will have to satisfy the patients. The status quo must not be disturbed. In the next paragraph it has the audacity to recommend an open-minded, eclectic and pragmatic approach to clinical management, yet it has all too clearly demonstrated how closed its members' minds are.
I had a little more to say. However, perhaps I may briefly ask the Minister whether she will reject the report for the time being until we have had the report of Professor Woods from the COT committee.
8.23 p.m.
The Earl of Clanwilliam: My Lords, the report rightly gives recognition to the work of the noble Countess, Lady Mar, and my noble friend Lady Cumberlege in initiating this research. I was going to say that there could hardly have been a more authoritative document. However, having listened to the noble Countess and her reference to a sugared pill, I can only say that I hope the committee feels duly chastised by her severe, excoriating criticisms of its work.
Nevertheless the report clearly demonstrates the lack of knowledge in this field. In the evidence received from sufferers there is the confession that,
"The symptoms were often so distressful that sufferers were forced to stop working with serious consequences for their families".
It goes on:
"The symptoms and distress are genuine, and can continue for a long time; some individuals seriously consider suicide".
We are familiar with the excessive rate of suicide among farmers and the report shows that some of that may be due to OP poisoning. More needs to be known about that. The summary goes on to say that,
"existing clinical services for patients with symptoms associated with OP sheep dip exposure are unsatisfactory".
That is particularly serious especially in view of the summary at paragraph 2.24 which clearly indicates the widespread effects and the acute toxic reactions in detail. At paragraph 2.25 it admits that,
"how Ops might cause such effects is unknown".
Continued research in this field is vital. I ask the Minister what plans are in hand to push the research forward and to improve the NHS clinical services which are criticised in the report. There is also a call for greater information to be disseminated among family doctors, especially in country areas and among consultants so that they should have a firmer understanding of the problems. The report gives a list of sources of information which should be widely publicised.
Finally, those of us who have heard the noble Countess, Lady Mar, protest for so long and so often will be glad that she has been so clearly vindicated in her crusade. We sincerely hope that her efforts tonight will ensure that the crusade continues with success. We all owe her a deep debt of gratitude.
8.25 p.m.
Lord Clement-Jones: My Lords, I welcome the initiation of the debate by the noble Countess, Lady Mar. I, too, wish to pay tribute from these Benches for her tireless work on behalf of those suffering from exposure to organophosphates. I hope that the debate today will range much wider than the report of the joint working party.
As the noble Countess, Lady Mar, explained in some detail, the remit of the report was extremely limited. Its conclusions were limited, not to say unhelpful. The Ministry of Agriculture has known about problems with organophosphates since 1951 when the Zuckerman Committee, under Lord Zuckerman, recommended that urgent research be carried out to replace organophosphates. Toxicologists and physicians, and the

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World Health Organisation, were warning of the consequences of lack of protective clothing as far back as 1957–58. MAFF, needless to say, did not heed any of that at the time and continued not to do so until recently.
It amounts to a complete failure of risk assessment for those chemicals. The Ministry's approach has caused a huge amount of needless distress and suffering. Blame must also be laid at the door of manufacturers such as CIBA Geigy and others who made guidance on risks available to their workforce but not to farmers.
Then there is the question: why after eight to 10 years of compulsory dipping was the plug pulled in 1992, and it was made no longer compulsory? Was it because the Ministry received new information from the Veterinary Medicines Directorate about adverse effects? Was it because MAFF could be held responsible for their use? Did the Government receive new information about dangers when the decision was taken? Without a freedom of information Act we cannot find out. If in the early days of health problems having been identified it had been possible for legal representatives to obtain this information from the Veterinary Medicines Directorate, we would now be in a very different situation.
Perhaps the Government can now answer the questions: what report did MAFF receive in 1992 which caused it to cease the compulsory use of OPs? Why did Mr. Gummer say that he was personally persuaded of the dangers of OPs back in 1992? Did he see a report? Was the Ministry frightened of judicial review or other forms of liability for personal injury? Farmers certainly never saw a report. My honourable friend Mr. Paul Tyler has campaigned for many years on their behalf as a result.
If we are to believe it, it seems that the Ministry of Defence never saw it either. As a result, our soldiers were allowed to use organophosphates extensively in the Gulf War with all the consequences that we now know about and which have been highlighted so cogently in other ways by the noble Countess, Lady Mar, and my honourable friend Mr. Menzies Campbell. These soldiers did not even receive the basic advice about use which is provided to sheep farmers. The OP group, in its report in June of this year, points out the real problems which exist with exchange of information between government departments. The safety information looked at by the Veterinary Products Committee is classified as secret—another reason for a freedom of information Act as soon as possible.
In the view of these Benches, the report of the OP group was far too cautious. We take very seriously the advice given by Dr. Goran Jamal to a briefing of MPs earlier this year. He is a consultant neurophysiologist at the Southern General Hospital in Glasgow. He said:
"I can say with absolutely no hesitation that these products are unsafe".
He has pointed to at least 12 studies which show chronic low-level damage caused by organophosphates. He has pointed out fundamental problems with the so called "hen test". We now know of at least six cases here and abroad where claimants have been successful in showing damage to their health from organophosphates
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and obtaining substantial damages. We also now know as a result of Gulf War syndrome research of the impact of stress in breaching the blood brain barrier allowing these substances to have a toxic effect. What is Government's response on all this?
The view of these Benches is that in the short term much greater control on use is needed with specified contractors only being able to use OPs. In the long term, we should be giving ultimatum to manufacturers to phase out OPs. We should say that after 1st January 2000 these products will no longer have a licence for sale. The key use is for sheep scab. There are injectable pharmaceuticals that can be used. It is vital that other treatments are developed as a matter of urgency. Furthermore, it is vital that the Department of Health assumes prime control over this matter rather than MAFF. I am heartened by the fact that the noble Baroness, Lady Hayman, is replying to this debate.
Perhaps the Government, coming fresh to this issue now, recognise that this is principally a public health matter rather than a problem over which MAFF should have the power of decision. We cannot allow the bald statement by the OP group that:
"if sheep dips were not available this would have a damaging effect on farmers' capacity to prevent and treat sheep ectoparasites",
to override public health considerations. In that event, the farmers of the present and future will not be best served.
In the field of further research, one of the most worrying aspects—and one on which I hope the noble Baroness can reassure us—is the omission of any official work on the effect on children. The official OP group did not address, in particular, the question of genetic damage being caused by exposure of mothers to OPs or damage caused by contact with parental clothing. There are also implications for children's headlice treatment using melathion. Are we convinced that this is safe? I hope that the noble Baroness can reassure the House that such research is now in prospect.
Finally, for the future, why cannot we institute a yellow card system similar to that used for medicines so that adverse effects are recorded? I look forward to the Minister's response.
8.32 p.m.
Earl Howe: My Lords, the noble Countess, Lady Mar, deserves our thanks, not for the first time for giving us the opportunity to consider the vexed and difficult issue of OP sheep dips and specifically for directing our attention to the recent report by the Royal Colleges.
The publication of that report is a further stage in the slow progress of what seems sometimes to be an interminable saga. I say that with some feeling. The noble Countess and I go back a long way on OP sheep dips. It was towards the end of 1992 when her campaign in Parliament began in earnest. As a Minister in MAFF at the time, I have good reason to remember what a fluttering in the dovecotes it caused. We were all made to sit up and pay attention, and quite right too.

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The worst part of it all, if I may now speak personally, was coming to your Lordships' House on repeated occasions armed with a brief from the Ministry which said in unvarying terms that OP sheep dips were "safe if used in accordance with the manufacturer's instructions". Repeating that refrain was a source of some discomfort. It was not that I was being made to say something in which I disbelieved. On the contrary, I accepted the scientific advice so far as it went. It was the knowledge that the noble Countess would almost climb up the wall of this Chamber in exasperation every time I said it and the equal certainty that distinguished Members of your Lordships' House would follow her lead. No government spokesman can withstand such repeated verbal pummelling for more than a certain length of time. Therefore, I wish the Minister well this evening.
It was as a direct result of the noble Countess's efforts that MAFF set in train the epidemiological studies which were designed to elucidate some of the basic facts of the whole issue. Specifically, they were intended to shed light on the question of whether or not there exists a recognisable syndrome associated with the use of OP dips over an extended period of time and, in doing so, to give a rather more educated answer to those individuals who have attributed a considerable measure of distress and pain to that same cause.
They were intended also to point the way to further research. The year after those studies were commissioned, my noble friend Lady Cumberlege, as we have heard, as the health Minister, took forward a parallel initiative through her own department designed to assess the clinical evidence of chronic OP dip exposure as presented by sufferers and to advise on both clinical management and future studies. The result of that programme of work is the report we are now considering.
I have read this report with some care. The noble Countess has expressed her disappointment in it in no uncertain terms. She has raised a number of issues which, I confess, had passed over my head, but which should clearly be addressed by the Government with the utmost seriousness.
Despite that, I have to say to her that I do not believe that we should judge the report too harshly. As she pointed out, the members of the working party were given a fairly narrow remit and to my eyes at least, have done their best in the face of a glaring paucity of evidential data. Some of the data which does exist is contradictory. Personally, from my experience at MAFF, I cannot say that that aspect of the report is a surprise and I shall say more about that in a few moments.
What I found disappointing, indeed shocking, was the not very veiled criticism of the methodology of the epidemiological work which has so far been published. It seemed to me that paragraph 2.26 of the report is about as damning an indictment as there can be in civilised language. If we accept the criticism, as no doubt we must, it is a depressing commentary on a great deal of time and effort expended by many well-intentioned professional people over a great many years.
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The most valuable parts of the report are those dealing with the clinical management of sufferers and their symptoms and the section at the end which addresses the various possibilities for future research. Those are the areas to which I hope Ministers will direct their immediate attention. One of the main messages of the document is that regardless of the array of question marks surrounding the whole subject, and regardless of there being no neat series of explanations for people's symptoms and sufferings, doctors must be in no doubt that the symptoms and sufferings are real and must treat each case seriously and with sympathy.
The inadequacy of NHS clinical care for victims of OP exposure is baldly stated and must surely be to us all a matter of acute disappointment. It is clear that sending circulars to GPs, as has been done in the past, is nowhere near sufficient to ensure that OP sufferers are treated as they should be in the doctor's surgery.
But what is the report really telling us? It has some reasonably definite things to say about acute OP poisoning, but when it comes to chronic low-level OP exposure, which we need to keep in mind is the matter at issue, it seems to me to be saying, in a sometimes somewhat round-about way but in a tone that is never less than sympathetic, that we still know almost nothing about the effects of it or how to treat it. We cannot even define the symptoms associated with it. They are non-specific.
Many who complain of some of the symptoms—depression, fatigue, loss of concentration—are apparently found to have no abnormalities at all. Those studies which have identified cognitive defects or neurological dysfunction conflict with others which have failed to find any such phenomenon. There is even a suggestion that the interpretation of the results of some of the population-based studies is open to question and that in certain quarters a bias may exist against publishing negative findings.
The difficulty, as I note from the report, is that the symptoms complained of by OP users are also precipitated by exposure to other products. When presented with a set of symptoms, how is a doctor supposed to know what really caused them? All he can do is to treat the symptoms he sees. Even someone who confidently states that re-exposure to OPs has caused a recurrence of symptoms may well be attributing the way he feels to the wrong cause. What initiated the illness in the first place may be something quite different from what perpetuates it. The report suggests that anxiety, depression and general frustration are often sufficient in themselves to trigger the symptoms which the patient associates with OPs and—apparently—may also account for reported cases of chemical hypersensitivity.
I could almost picture the face of the noble Countess reading these sections of the document. It cannot be easy for her as someone who has campaigned tirelessly to obtain recognition for a group of sufferers who have not been given the attention due to them, to be told by two Royal Colleges, albeit in a polite way, that there is no proof for what she has been saying. But I suggest to her

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again that this is not the fault of the Royal Colleges. It is not enough to say, as Dr. Johnson did when challenged to prove that human beings have free will:
"We know our will is free, and there's an end on't".
Government policy can only be formulated on the basis of sound and firm science. The proper way forward is to point, as the report very clearly does, to the gaps in our knowledge and look for ways in which those gaps might be filled. That is easier said than done. I am not an epidemiologist. But I well remember as a Minister appreciating how complex this particular issue is for researchers to pin down. When MAFF first advertised for research proposals in 1995, it received 13 responses from eminent scientific establishments. Not one of them met the specification. The result was great embarrassment all round. But, difficult as it was, we had to get it right. I hope in the end we did so.
Perhaps I may ask the Minister whether she will indicate the current progress of government-funded research into chronic OP exposure and what plans there are in her department or in MAFF to commission further research. It is perhaps too soon to expect a detailed response from her to the conclusions and recommendations in the report, but nevertheless can she confirm that her department will take full account of these conclusions when drawing up any further research proposals? I know that she will agree with me that while research is important, it is inevitably a long-term exercise. Meantime health and safety on farms must be paramount, and patients who complain of illness to their doctors need looking after. Can the Minister say whether Ministers have any plans to ensure that the shortcomings in clinical management revealed in the report are properly addressed and eliminated? Is this the kind of role which might be performed by the proposed National Institute for Clinical Excellence?
This has been a useful short debate. I hope the noble Countess will regard it as such (despite her strictures); and I look forward with great interest to hearing what the Minister has to say.
8.43 p.m.
Baroness Hayman: My Lords, the whole House is aware of the work the noble Countess has done over many years to raise awareness about the potential health risks of organophosphates. She has vigorously pursued her concerns with my predecessors and fellow Ministers from other departments over a long period of time. Her tenacity and commitment to this cause are well known. As the noble Earl, Lord Howe, pointed out, the health risk the noble Countess presents to Ministers who come before your Lordships' House not properly briefed on the subject is well known.
From the beginning the Government have pledged to take seriously the concerns highlighted by the noble Countess and to take whatever steps are necessary to satisfy ourselves that every aspect of the subject regarding OPs is given proper consideration. It was for that reason that we set up a high level inter-departmental committee of officials to examine the issues. Its recommendations to Ministers were published earlier this year and are already being implemented.
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As has been pointed out, it is a complex issue and scientific opinion is divided. While there is little dispute that acute exposure to high levels of OP compounds can cause ill health, there is no widely accepted clinical syndrome associated with prolonged exposure to low levels of OPs. It is essential that we gain a clearer picture of exactly what the health risks might be from OPs.
The noble Earl, Lord Clanwilliam, asked about certain projects that are currently being funded by the department. Details of those are set out in the report of the inter-departmental official group, copies of which have been placed in the Library. Perhaps I can say a little about one or two of them. One is being undertaken by the Institute of Occupational Medicine in Edinburgh. It is costing approximately £500,000 and will take three years to complete. A report is expected in April next year. That research is examining the potential health effects of OPs in relation to farmers but the results may help us to understand the possible effects of exposure to OP-based pesticides generally, including any possible relationship to illness experienced by Gulf War veterans.
The Earl of Clanwilliam: My Lords, perhaps the Minister will give way. It was only five years ago that the same epidemiological study was started in Edinburgh. It lasted for two years and was shut down. Will the information it gained, which was sufficiently important to stop it, be put forward to the new discussion?
Baroness Hayman: My Lords, the noble Earl raises an important point. Perhaps I can take the opportunity to look into it and write to him on that issue. He points out that there is a considerable body of current scientific literature on OPs. One of the things we are doing is subjecting that to rigorous scrutiny. A specially convened working group of the committee on toxicity is doing that important work and I know that the noble Countess is one of many people who have given evidence to that group.
The COT's advice will include recommendations for further research if appropriate, and when its report is published next year the relevant advisory committees and the official group will be asked to consider their recommendations and report to Ministers. That will be the context in which we look at the possibility of research into potential effects on children highlighted by the noble Lord, Lord Clement-Jones.
In relation to the OP mechanisms of toxicity other than the depression of cholinesterase, the Government are funding research into the effects of OPs on enzymes at Newcastle University and Porton Down. There is also important research funded by the Medical Research Council. As the results are produced they are being carefully evaluated by the expert scientific committees but to date have not offered any new advice on the safety of OPs.
While that research is going on we fully recognise that there is a group of people whose suffering is occurring at the present time and is undoubtedly very real. Whether or not their illnesses can definitively be proved as being due to exposure to OPs, they deserve

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the best medical care and treatment that can be provided. Much has already been done to inform doctors. Chief medical officers have written to doctors alerting them to the possibility of adverse effects from exposure to pesticides and certain veterinary medicines.
An article in the October 1995 edition of the Chief Medical Officer's update—a quarterly publication sent to all doctors in England—dealt with both the chronic effects of OPs and how to report adverse reactions to them. In 1996 the book Pesticide Poisoning: Notes for the Guidance of Medical Practitioners was sent by all UK health departments to general practitioners, accident and emergency departments and others. Presidents of the Royal Colleges were encouraged to draw the book to the attention of their fellows and members through their continuing medical education programmes.
It was in recognition that more needed to be done, and at the behest in no small measure of the noble Countess, that the Department of Health, through the noble Baroness, Lady Cumberlege, encouraged the Royal Colleges to carry out further work in relation to their awareness that this was an area that needed to be looked at, particularly in regard to ways of improving the treatment and the knowledge that was available to GPs.
That was the provenance of the report that is being discussed tonight. The Royal Colleges set up a working party to look at clinical aspects of patients with symptoms that may be attributable to long-term exposure to low levels of OP sheep dip. They did not specifically consider the question of causation as this is the subject of many other avenues of investigation being pursued by the Government, of which I have already given some details tonight.
The working party was independent of government. Their report was produced by the Royal Colleges, which also decided upon the membership. Perhaps I might give an outline tonight of the steps that we have taken in response to that report. However, given the detailed and very critical nature of the comments of the noble Countess, I will need to look at those as well, in terms of the response.
We have already opened discussions with directors of the National Poisons Information Services in suitable areas on the report's recommendations for providing specialist advice in areas where it may not currently
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exist, and for improving the level of support to GPs who have patients who may be suffering from the effects of OP poisoning. We will announce the outcome of these discussions as soon as action has been agreed. The report also makes recommendations for further research. We are therefore asking the COT working group and the relevant statutory advisory committees to consider the report overall and, in particular, the research recommendations, and how they may be taken forward.
One of the positives about the report is that it has emphasised the role of the GP in diagnosis and patient management, but it also recognised the practical difficulties faced by GPs and the limitations of current knowledge of the causes and mechanisms underlying the condition. The report recommends adopting a strategy of supportive treatment because, it says, the principles of rehabilitation following substantial illness are similar. That is not the same as saying that the condition is not real, nor that it has no physical cause, but only that it may be the best way of treating the symptoms, whatever the cause may be.
The report contains some useful advice for GPs on diagnosis and management and we will be discussing it with the Royal College of General Practitioners and looking to the next edition of the Chief Medical Officer's update in February of next year to encourage those in rural areas in particular to consider the advice that is contained in it, as part of the drive to improve the treatment of sufferers.
I hope that the actions I have outlined clearly indicate our determination both to gain a better understanding of the human health effect of OPs and our commitment to ensuring that the concerns expressed by the noble Countess and others that the healthcare needs of those who may be suffering from the effects of OPs are fully addressed. I should like to assure the House that we will be keeping the diagnosis and treatment of this group of patients under active review in the light of emerging findings from the research and reviews of the scientific evidence currently under way. We will take whatever steps are necessary as our understanding of the condition grows. For the present time, however, I believe that the Royal Colleges' report offers an opportunity to increase awareness among the medical profession that these patients have genuine needs, and to improve the general level of care that is offered to them.
House adjourned at six minutes before nine o'clock.