Lords Sitting of 10 July 1998

Preamble
The House met at eleven of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Manchester.

Data Protection Bill [H.L.]
The Parliamentary Under-Secretary of State, Home Office (Lord Williams of Mostyn): My Lords, I beg to move that the Commons amendments be now considered.
Moved, That the Commons amendments be now considered.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
[The page and line refer to Bill (158) as first printed for the Commons.]

COMMONS AMENDMENT
1 Clause 1, page 1, line 12, leave out 'or'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 1. In speaking to this amendment I shall speak to the numerous other amendments in this group. All deal with rights of access to information held in certain manual records.
The records in question are those to which the Access to Personal Files Act 1987, the Access to Health Records Act 1990 and the Education (School Records) Regulations 1989 and the corresponding legislation in Scotland and Northern Ireland apply. These are local authority housing and social services records, health records, and records held by schools on pupils and former pupils.
The amendments are numerous. That is because the provision they make is technically complex and intricate. But the underlying purpose is perfectly straightforward. That is to consolidate in the Bill the access rights given in the other legislation to which I referred and thereby to give effect in respect of the relevant records to the ECHR judgment in the case of Gaskin.
Gaskin is to do with refusal of subject access. It says that where access is refused because of the risk of identifying third parties who have not consented there must be a mechanism for independent review of that refusal. The Bill deals with this in two ways. Where access has been refused data subjects may seek a court order requiring access to be given or they may request an assessment to be made by the data protection commissioner who has the power to take the necessary enforcement action.
The Bill, as it left this House, did give effect to the Gaskin judgment in relation to automated and structured manual records within the first three parts of the definition
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of "data" in Clause 1. So, to the extent that public bodies—for example, local authorities, NHS trusts and schools—hold records likely to be caught by the Gaskin judgment, the Bill, as it left this House, already did the job for those automated or manual records which came within its scope.
We did need, however, to make the necessary provision for the other unstructured manual records to which there is an existing right of access under the other legislation and which did not then come within the scope of the Bill. To deal with that problem—because we wish to meet the United Kingdom's ECHR obligation in this case in full—we decided to bring those additional records within the scope of the Bill. That is the purpose of these amendments.
Moved, That the House do agree with the Commons in their Amendment No. 1.—(Lord Williams of Mostyn.)
Viscount Astor Viscount Astor: My Lords, we welcome these amendments.
On Question, Motion agreed to.

COMMONS AMENDMENT
2 Clause 1, page 1, line 14, at end insert 'or
(d) does not fall within paragraph (a), (b) or (c) but forms part of an accessible record as defined by section (Meaning of "accessible record");'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 2.
Moved, That the House do agree with the Commons in their Amendment No. 2.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENT
3 Clause 1, page 2, leave out lines 39 to 47.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 3. In dealing with that amendment, I shall speak also to Amendments Nos. 5, 6 and 102.
The purpose of Amendments Nos. 3 and 102 is to delete Clause 1(5) and (6) and the associated reference to the definition of "transfer" in the index of defined expressions in Clause 65. Clause 1(5) and (6) was included in the Bill with the intention that it might clarify the somewhat opaque provisions relating to the international movement of personal data in Articles 4 and 25 of the directive.
The wording of Clause 1(6) in the Bill, as introduced, gave rise to a certain amount of confusion. We therefore introduced an amendment in another place designed to clarify its effect.
Not for the first time, after listening carefully to further representations made, we concluded that there was still a measure of confusion about the purpose and effect of Clause 1(5) and (6). Since their sole purpose was to clarify, that was rather unsatisfactory. We could not see a useful way in which the necessary clarity could be achieved by further amendment and we thought that the best thing would be just to delete them.

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Amendments Nos. 5 and 6 make a small change to Clause 5 to bring it into closer conformity with the data protection directive, providing that, where processing to which the Bill applies is done by a controller established outside the United Kingdom but using equipment in the UK, the controller must appoint a representative in the UK. The directive requires provision of this kind. These amendments remedy that relatively small deficiency in the Bill.
Moved, That the House do agree with the Commons in their Amendment No. 3.—(Lord Williams of Mostyn.)
Lord Renton: My Lords, I have not taken part previously in proceedings on this Bill. I wonder, looking at Clause 5, what is meant by the word "established", what effect it will have and the condition that it indicates. We find the same word used in Amendment No. 5. That is why it seems to me to be in order to raise the matter. It is a very vague word. It could mean "residing" or someone who has an office in the United Kingdom but moves about the world. What is the word intended to mean in the context of this Bill?
Lord Avebury: My Lords, before the Minister replies to the noble Lord, Lord Renton, perhaps I may also ask a question. What is the situation regarding the dissemination of information via the world-wide web? A case has recently come to my attention where information relating to the sexual orientation and religious beliefs of an individual was placed on a website. The service provider was approached by the individual and asked to take the information off the web. He did so in circumstances where, I understand, the interpretation of Section 1 of the Defamation Act was not clear as applying to service providers. He was afraid that litigation against him might ensue as the publisher of that material. If we disregard that and the application of this clause to service providers, is there not an additional danger that where those operating websites place information in relation to an individual on a page it becomes available to anyone in any country and would seem to be caught by this part of the Bill? Would the Minister care to say anything for the benefit of service providers about their obligations under this Bill where those who use service providers for their web pages disclose such information? Would they be liable to any action in the courts? Will not that place even further restrictions on what the service providers are prepared to allow, thus inhibiting freedom of expression on the web?
Lord William of Mostyn: My Lords, if the noble Lord, Lord Avebury, will provide me with the details of the case that troubles him, I undertake to write to him on the specific questions that he has raised. I am happy to address the general problem. I can deal with it shortly now or in correspondence with the noble Lord, which I undertake to place in the Library. I should have thought that it may be more fruitful to place such correspondence in the Library once I have considered the full details, if the noble Lord does not mind giving them to me in writing.
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In reference to the question from the noble Lord, Lord Renton, "established" in this Bill has the same meaning as in Community law generally.
Lord Renton: My Lords, there is a reference to it in Clause 5(2), which rather elaborately includes various situations, but it did not seem to me to be complete which is why I raised the matter. However, I take note of what the noble Lord says and will follow it up.
On Question, Motion agreed to.
11.15 a.m.

COMMONS AMENDMENT
4 Clause 2, page 3, line 5, leave out 'or other beliefs' and insert 'beliefs or other beliefs of a similar nature,'.
The Solicitor-General (Lord Falconer of Thoroton): My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 4. I should like to speak also to Amendments Nos. 79, 80, 114 and 115.
I shall deal first with Amendment No. 4. Clause 2 sets out lists of sensitive data for the purposes of the Bill. These data may only be processed if one of the conditions in Schedule 3 is met.
Article 8 of the directive requires personal data revealing "religious or philosophical beliefs" among other categories to be treated as sensitive.
The Bill originally gave effect to this requirement in Clause 2(b) by referring to "religious or other beliefs". On reflection, we took the view that that was insufficiently precise. Amendment No. 4 changes this to read, "religious or other beliefs of a similar nature". We believe that that expression captures more precisely the data which the directive requires to be treated as sensitive.
I turn now to Amendments Nos. 79 and 114. These amendments are intended to make sure that paragraph 7 of Schedule 3 is fully consistent with the directive. Paragraph 7 permits the processing of sensitive data where necessary for a range of public sector functions. This paragraph is included in reliance on Article 8.4 of the directive.
Article 8.4 specifies that processing to which it relates must be accompanied by appropriate safeguards, and must be carried out for reasons of substantial public interest.
As it left this House, paragraph 7 made no express reference either to substantial public interest, or to safeguards. We think that both these requirements will normally be met in the circumstances covered by the paragraph. However, given the breadth of the provision, we think it prudent to make provision to deal with any cases which may arise where they may not be.
Amendment No. 114 allows the Secretary of State by order to specify cases in which the public sector processing may not involve sensitive data. This would, for example, allow processing which was conceivably not in the substantial public interest to be excluded from the scope of the paragraph.

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The order may also specify cases in which sensitive data may only be processed if specified conditions are met. The conditions could take the form of additional safeguards to ensure full conformity with the directive in any doubtful case.
Amendment No. 79 provides that the power is subject to the negative resolution procedure.
I turn now to Amendments Nos. 80 and 115. The House will recall that at Third Reading an undertaking was given to bring forward an amendment to make clear on the face of the Bill that information about racial or ethnic origin may be processed for the purpose of ethnic monitoring. This was in response to an amendment tabled by the noble Lord, Lord Dholakia. These amendments give effect to that commitment.
Amendment No. 115 introduces a new paragraph into Schedule 3 which has the effect which I have just mentioned. It says that information about racial or ethnic origin may be processed for ethnic monitoring purposes, provided that the processing is carried out with appropriate safeguards. Subparagraph (2) provides for the Secretary of State to specify by order circumstances in which the processing is or is not to be taken as being carried out with appropriate safeguards.
Amendment No. 80 would add that order-making power to the list of those in Clause 63(5) which are subject to the negative resolution procedure.
These amendments have been drafted in close consultation with the Commission for Racial Equality which welcomes them. I am grateful to the commission for its help.
Moved, That the House do agree with the Commons in their Amendment No. 4.—(Lord Falconer of Thoroton.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
5 Clause 5, page 3, line 37, at end insert—
'(1A) A data controller falling within subsection (1)(b) must nominate for the purposes of this Act a representative established in the United Kingdom.'.
6 Page 3, line 38, leave out 'subsection (1)' and insert 'subsections (1) and (1A)'.
Lord Williams of Mostyn: My Lords, I beg to move that this House do agree with the Commons in their Amendments Nos. 5 and 6. I have already spoken to these amendments.
Moved, That the House do agree with the Commons in their Amendments Nos. 5 and 6.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENT
7 Clause 7, page 4, line 41, leave out 'section 8' and insert 'sections 8 and (Application of section 7 where data controller is credit reference agency)'.
Lord Falconer of Thoroton: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 7. I shall speak also to the other amendments in this group. One of the purposes of the
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Bill is to consolidate into the general data protection regime the special arrangements which apply to personal data held by credit reference agencies under the Consumer Credit Act 1974. This was dealt with in Clauses 7(7) and 59 of the Bill as it left this House. But those provisions did not completely achieve the desired effect. The purpose of this set of amendments is to bring the arrangements in the Bill more closely into line with the current arrangements under the 1974 Act.
The key provision is the new clause added by Amendment No. 18. Subsection (1) provides that the subject access under Clause 7 has effect subject to the new clause when the data controller is a credit reference agency. The 1974 Act gives individuals a subject access right to credit reference agency information. The permitted turn-round time is quicker and the fee is cheaper than those under data protection legislation. Given the large number of subject access requests to credit reference agencies—there are about one million a year—we think the revised approach is better. Subsection (2) of the new clause provides for subject access requests to credit reference agencies to be dealt with on this "quick and cheap" basis unless the data subject request indicates otherwise. Clause 7(7) as it left this House would have had the opposite effect.
Subsection (3) of the new clause preserves the duty on controllers under the 1974 Act to inform the data subjects of their rights under Section 159 and allows for the addition by order of a duty on controllers also to give information about rights under the Bill. The remaining amendments in the group make the necessary consequential amendments required by the addition of the new clause and make transitional arrangements. The purpose is effectively to maintain the position as it now is under the Consumer Credit Act 1974 until 24th October 2007 when the Bill's regime must apply in full.
Moved, That the House do agree with the Commons in their Amendment No. 7.—(Lord Falconer of Thoroton.)
Viscount Astor: My Lords, in another place there was significant debate on these issues. There is concern in the credit industry that this requirement will have a detrimental effect on small businesses or individuals trading as partnership or sole traders. There is a need to ensure that credit reference agencies have correct information, but as the Bill is drafted a credit agency may ask for a reference from a bank, insurance company or anybody who trades with that individual and the response may be that the business is not worth the candle and it should not be lent any money. If the credit agency turns down the applicant, the latter has the right to see the information that is available. As a result no one will want to provide what they consider to be accurate information because of the risk of being sued if it turns out to be wrong. In effect people will say that they simply cannot comment and it will restrict the flow of information.
The Minister in another place said that the Government would keep this under review and consult the credit industry and small businesses. This is an important issue. I accept that the Government have

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tabled this amendment for the very best of motives. However, it may operate in entirely the wrong way. Can the Minister go a little further than his colleague in another place and provide the House with some reassurance that the Government will, on a regular basis, meet the industry and will be prepared to return to Parliament to make changes if it is found that the provision is not working?
Lord Falconer of Thoroton: My Lords, I am grateful for the points raised by the noble Viscount. The Government are aware of the concerns expressed by the credit industry on this issue and the fact that the identity of companies who have given references in certain circumstances may not be protected from identification by the data subject. As the noble Viscount said, undertakings were given in another place that the matter would be kept under review. I repeat that the Government will keep the matter under review and look at it again in about three years in consultation with the credit reference industry and small businesses generally. I very much hope that that goes a little further as the noble Viscount requested.
Viscount Astor: My Lords, I am grateful to the Minister.
On Question, Motion agreed to.

COMMONS AMENDMENT
8 Clause 7, page 5, line 15, after 'subject' insert 'for the purpose of evaluating matters relating to him such as, for example, his performance at work, his creditworthiness, his reliability or his conduct,'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 8. I shall speak also to the other numerous amendments in the group. This Bill is technical in nature and inter-related in structure. We have introduced a number of relatively minor amendments with the aim of making sure that the technical effect of the Bill is as intended. That is the nature of the amendments in this group. Individually they do not make changes of any great substance.
Amendment No. 104 is part of the Gaskin grouping, which we have already discussed, but it covers a non-Gaskin point. The amendment adds three new provisions to those listed in Clause 69(2) of the Bill which will come into force on Royal Assent. Two of those provisions, new paragraphs (ef) and (eg), relate to the Gaskin group. New paragraph (ee) relates to the commissioner's powers. It is required to ensure, for example, that the registrar can exercise the commissioner's functions in relation to notification regulations in advance of Clause 6(1) coming into force. The preparation of those regulations will be an important part of the next phase of this legislation if, as it is hoped, the Bill progresses shortly to its enactment.
The Bill provides for a large amount of subordinate legislation—altogether some 40 instruments. Much of this will need to be in place before we can implement the regime required by the data protection directive. Work has begun on subordinate legislation but a good
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deal remains to be done including in some cases consultation with interested parties. We do not want to rush through the work to an over-tight schedule. Reluctantly, we have decided to accept that 24th October 1998 is no longer a realistic target date for implementation of the new regime. My honourable friend Mr. Howarth indicated as much recently in another place.
I cannot give the House a firm indication today of a revised implementation date. We intend to make all good speed. We want to bring the Bill into force at the earliest realistic opportunity. We shall indicate a date as soon as we can. I do not expect it to be before the end of this calendar year, but I hope it will not be long after that. I beg to move.
Moved, That the House do agree with the Commons in their Amendment No. 8.—(Lord Williams of Mostyn.)
Viscount Astor: My Lords, I should like to put to the Minister a question relating to Clause 8(5) which deals with trade secrets. This matter was debated in your Lordships' House. The industry and the CBI were, and are still, concerned about the Government's view of what constitutes a trade secret. Can the Minister deal with that so that we have on the record of this House the view of the Government which will make it easier for industry when considering these issues?
Lord Williams of Mostyn: My Lords, I am grateful for the noble Viscount's question and his wholly co-operative attitude throughout all stages of the Bill. It has been very important to discuss these matters as fully as we can particularly with those organisations with legitimate trade and business concerns.
In Clause 8(5) "trade secret" carries its ordinary meaning. Whether particular material used in automated decision making—which I believe to be the purpose of this question—is covered depends on the circumstances of the particular case. Material that is commercially available and is used by more than one organisation is unlikely to be covered by the provision. It is probably wide enough to cover material prepared in confidence by a commercial organisation for the purpose of its business which is not in the public domain and which could, if disclosed, prejudice the organisation's business.
There was a particular concern which I know was expressed about algorithms which some organisations use to determine whether to meet individual's requests for a service of some kind; for instance, a credit scoring system used to determine whether or not to give people credit. The concern expressed—the noble Lord is right—is that if the detail of factors used to make those decisions were to be disclosed those seeking credit would be able to massage the information they provide and undermine the system. That is a legitimate concern in the Government's view. Therefore on 3rd June this year Home Office and DTI officials met CBI representatives to discuss that concern. Officials explained that reference to "trade secret" was wide enough to meet those concerns. I believe that the CBI

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accepted that, but indicated at that stage that it would like the Government's view put on public record, which is what I am happy to do.
11.30 a.m.
Lord Renton: My Lords, I feel obliged to draw attention to another drafting point. It is on Amendment No. 8 which amends Clause 7(1)(d) which is a fairly long subsection. Paragraph (d) runs to more than four lines. Another three lines will be inserted in it. When one reads the paragraph, as amended, it is not easy to follow, and it becomes, I am sorry to have to say, a clumsy piece of drafting. At this stage, of course, with so many Commons amendments being considered, I realise there is nothing that the Government can do about this problem. If we find that there is an awkward piece of drafting, we should draw attention to it just to alert the parliamentary counsel to the fact that that sort of thing should be avoided in the future. This is a clumsy piece of drafting.
Lord Williams of Mostyn: My Lords, I am not sure that I accept the epithet "clumsy". It is certainly technical, but in the nature of the beast there is no alternative but to have technical definitions which are sometimes lengthy and need to be scrutinised.
Accessible records are themselves defined in the new clause which is added by Amendment No.87. They are essentially those records to which I made reference earlier: existing statutory access rights, outside the scope of the data protection regime. They include certain health records, accessible public records and educational records, as defined in the new schedules which are added by Amendments Nos. 131 and 132.
I agree that one needs to spend some time looking at the effect of what is technical legislation, but I have to protect the draftsman against charges of clumsiness. However, if he feels on reflection that he may have erred into clumsiness, I am sure that he will accept the noble Lord's reproof in the good-natured way in which it was tendered.
On Question, Motion agreed to.

COMMONS AMENDMENTS
9 Clause 7, page 5, line 20, leave out from 'subsection (1)' to end of line 21 and insert 'unless he has received—

(a) a request in writing, and

(b) except in prescribed cases, such fee (not exceeding the prescribed maximum) as he may require.'.

10 Page 5, line 31, leave out from beginning to 'or' in line 33.
11 Page 6, line 4, at end insert—
'(6A) An individual making a request under this section may, in such cases as may be prescribed, specify that his request is limited to personal data of any prescribed description.'.
12 Page 6, leave out lines 5 to 7.
13 Page 6, leave out lines 16 and 17.
14 Page 6, leave out lines 18 to 22.
15 Page 6, line 22, at end insert—
'"prescribed" means prescribed by the Secretary of State by regulations;'.
16 Page 6, line 23, leave out 'by the Secretary of State by regulations'.
17 Page 6, line 26, leave out 'so'.
18 After Clause 8, insert the following new clause—
APPLICATION OF SECTION 7 WHERE DATA CONTROLLER IS CREDIT REFERENCE AGENCY
'.—(1) Where the data controller is a credit reference agency, section 7 has effect subject to the provisions of this section.
(2) An individual making a request under section 7 may limit his request to personal data relevant to his financial standing, and shall be taken to have so limited his request unless the request shows a contrary intention.
(3) Where the data controller receives a request under section 7 in a case where personal data of which the individual making the request is the data subject are being processed by or on behalf of the data controller, the obligation to supply information under that section includes an obligation to give the individual making the request a statement, in such form as may be prescribed by the Secretary of State by regulations, of the individual's rights—

(a) under section 159 of the Consumer Credit Act 1974, and

(b) to the extent required by the prescribed form, under this Act.'.

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 9 to 18.
Moved, That the House do agree with the Commons in their Amendments Nos. 9 to 18.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENT
19 Clause 10, page 8, leave out lines 15 to 18.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 19.
I shall also speak to Amendments Nos. 30, 76, 85 and 112. Amendments Nos. 19, 30 and 112 make small but important improvements to changes that were made to the Bill at Report stage in this House.
The House may remember that, following amendments tabled by the noble Lord, Lord Norton, in Committee the Government brought forward amendments which would require data controllers to respond in writing within 21 days to written notices from data subjects under Clauses 9, 10 and 13.
Following those changes the Government received very strong representations from the direct marketing industry about the requirement attached to Clause 10. It pointed out that it would be very difficult and costly for them to comply with, and that it might lead to a withdrawal of "opt out" boxes, which are very convenient for data subjects. So, paradoxically, a provision which was intended to help data subjects could result in their being worse off.
In any event, the requirement in Clause 10 serves too limited a function to offer worthwhile protection for data subjects. It is merely a statement of intention to comply

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with the law. A similar argument applies to the requirement under Clause 13(1). Amendments Nos. 19 and 30 accordingly remove these requirements; and Amendment No. 112 makes a consequential change to Schedule 1.
I turn to Amendments Nos. 76 and 85. The Bill makes provision in many places for notices and requests for other communications to be given or made "in writing".
It has been put to us—I hope this will chime agreeably in the mind of the noble Lord, Lord Avebury—that in this electronic age such notices should be capable of being made electronically. The Government agree. Accordingly, the new clause added by Amendment No. 76 provides in respect of certain of these that the requirement for them to be in writing is satisfied if they are given or made in electronic format; that is, by fax or e-mail. It also provides for the Secretary of State by regulation to provide that the requirement for notices and requests to be in writing is not to apply in circumstances prescribed in the regulations.
Amendment No. 85 adds those regulations to the list of statutory instruments subject to negative resolution procedure in Clause 63(5).
Moved, That the House do agree with the Commons in their Amendment No. 19.—(Lord Williams of Mostyn.)
Lord Skelmersdale: My Lords, I notice that the Minister referred specifically to the new clause after Clause 60 and Amendment No. 76. I observe that in subsection (2) the electronic transmission must be received in legible form. As one who has great difficulty on occasions with facsimile machines, and receives what I can only describe as gobbledegook—most certainly not legible—I assume that it will be a defence to produce a piece of fax paper which is clearly not in legible form.
Lord Williams of Mostyn: My Lords, I think that that would be right in the same way as any other form of writing has to be capable of being read. Otherwise it is not a valid notice.
Baroness O'Cathain: My Lords, perhaps I may seek clarification on the issue raised by my noble friend. Facsimile messages have a horrible habit of disappearing off the paper. For how long would one need to keep a copy? They fade.
Lord Williams of Mostyn: My Lords, the old ones fade, the new ones in our spanking new Home Office equipment are on plain paper. It is not really a question of how long one needs to keep a notice, because there is no difference in principle between a fax and a typewritten notice, which does not necessarily have to be kept by the recipient. It is the fact that the notice was given. I take the point made by the noble Baroness, that if one is going to entrust the message to the fax it would be a wise precaution for the fax sender to have a record that the fax was capable of being proved to have been sent. That is an important point.
On Question, Motion agreed to.

COMMONS AMENDMENTS
20 Clause 10, page 8, line 21, leave out 'requirement' and insert 'notice'.
21 Page 8, line 22, leave out 'requirement' and insert 'notice'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 20 and 21.
Moved, That the House do agree with the Commons in their Amendments Nos. 20 and 21.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENT
22 Clause 12, page 9, line 20, leave out from 'destruction' to end of line 22.
Lord Falconer of Thoroton: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 22.
I shall speak also to Amendments Nos. 23 to 28. These amendments make essentially technical changes to the Bill. I shall attempt to explain them simply. Clause 12, as it left your Lordships' House, gave courts two main powers: first, to order the rectification, blocking, erasure or destruction of inaccurate data; and to order the erasure, destruction, blocking but not rectification of data where a data subject has suffered damage for which compensation could be claimed or where there is a further risk of a similar occurrence.
The main purpose of Amendments. Nos. 22 to 28 is to bring consistency between the two powers. They give to courts a power under Clause 12(4) to order rectification of data as well as their erasure, destruction or blocking. As I have said, that power is currently not available to the courts. Attached to the courts' power under subsection (4) is a power similar to that already available under subsection (3) to require controllers to notify third parties to whom data have been disclosed of rectification and so forth. They clarify to which data the power in subsection (4) applies. The power is currently expressed in general terms. The amendments relate the power to particular data and they also ensure consistency of language.
Moved, That the House do agree with the Commons in their Amendment No. 22.—(Lord Falconer of Thoroton.)
Lord Renton: My Lords, this group of amendments is desirable and necessary. I am not making a drafting point this time. Amendment No. 28, the proposed subsection (4A) in the third line, refers to,
"third parties to whom the data have been disclosed".
As a practical matter, will the third parties necessarily be known or will there be difficulty in finding out who they are?
Lord Falconer of Thoroton: My Lords, I recognise the point the noble Lord makes. It was a point recognised by the draftsman because in the second line

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of subsection (4A) the court must consider whether it is reasonably practical to notify the third parties. So the point that the noble Lord, Lord Renton, has raised, which is an important point, can be considered by the court before it determines which third parties have to be notified. The point is covered.
On Question, Motion agreed to.

COMMONS AMENDMENTS
23 Clause 12, page 9, line 24, leave out from first 'of' to 'of' in line 25 and insert 'any contravention by a data controller of any of the requirements'.
24 Page 9, line 25, after 'Act' insert 'in respect of any personal data'.
25 Page 9, line 27, leave out 'failure' and insert 'contravention in respect of those data'.
26 Page 9, line 29, leave out 'erasure, destruction or blocking' and insert 'rectification, blocking, erasure or destruction'.
27 Page 9, line 29, leave out third 'the' and insert 'any of those'.
28 Page 9, line 29, at end insert—
'(4A) Where the court makes an order under subsection (4) it may, where it considers it reasonably practicable, order the data controller to notify third parties to whom the data have been disclosed of the rectification, blocking, erasure or destruction.
(4B) In determining whether it is reasonably practicable to require such notification as is mentioned in subsection (3) or (4A) the court shall have regard, in particular, to the number of persons who would have to be notified.'.
29 Page 9, leave out lines 30 and 31.
30 Clause 13, page 10, line 2, leave out '(1) or'.
31 Page 10, line 27, leave out from second 'decision' to end of line 28 and insert 'which is not based solely on such processing as is mentioned in subsection (1)'.
32 Transpose Clause 13 to after Clause 10.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 23 to 32 en bloc.
Moved, That the House do agree with the Commons in their Amendments Nos. 23 to 32.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENT
33 Clause 16, page 11, line 45, leave out 'section 21 applies to the processing' and insert 'the processing is assessable processing for the purposes of section 21'.
Lord Falconer of Thoroton: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 33. I shall speak also to the other amendments in this group.
These amendments make what is essentially a series of tactical improvements to the preliminary assessment provisions in what was Clause 21 when the Bill left this House, and also associated provisions.
Clause 21 provided for certain processing about which particular worries about data subjects' interests arise to be assessed by the data protection commissioner for compliance with the principles before it may begin. The processing in question is to be specified in subordinate legislation.
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The preliminary assessment is to be carried out in the context of notification. That is why all processing in this limited category, even where it is carried out manually or might otherwise have been exempted from the notification regime, has to be notified. As it stood, the Bill was not as clear as it might be about how the system works. The purpose of the amendments is to clarify matters.
Essentially they do three things. First, they make technical changes so that the key provisions in Clause 21 are much easier to follow and the sequence of events is set out more plainly. The drafting is simplified and made more narrative in its form. Secondly, they make clearer the relationship between the preliminary assessment itself and the notification which precedes it. Thirdly, both of those improvements are carried through to the transitional provisions where the arrangements are substantially simplified.
Moved, That the House do agree with the Commons in their Amendment No. 33.—(Lord Falconer of Thoroton.)
On Question, Motion agreed to.

COMMONS AMENDMENT
34 Clause 17, page 12, line 10, leave out 'may' and insert 'shall'.
Lord Falconer of Thoroton: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 34. I shall also speak to Amendments Nos. 35 to 38 and Amendment No. 145.
Clause 17 in the Bill as it left this House deals with the arrangements for data controllers to notify the data protection commissioner of the processing which they do. It covers both mandatory and voluntary notification. Subsection (1) said that controllers "may" notify the commissioner. Amendment No. 34 changes "may" to "must". This makes clear that any controller who wants to go into the register, following mandatory or voluntary notification, must make a proper notification to the commissioner in the form required by the rest of the clause.
As to Amendments Nos. 35 and 36, what was Clause 18 requires the data protection commissioner to maintain a register of notifications given under Clause 17. The provision limited the content of the register to the details notified by the data controller in line with Clauses 15 and 17 together with any necessary updating amendment. But it could sometimes be appropriate to include further material in the register entry. Amendments Nos. 35 and 36 allow for this. An example of the additional material that might be included would be the content of an enforcement notice that was in force in respect of a particular data controller. Under the amendments, the notification regulations would be able to authorise or require the commissioner to include the particular types of material. The regulations themselves would need to be laid before Parliament. The amendments are intended, therefore, to allow limited, commonsense additions to notification entries.
Amendment No. 37 makes clear that the commissioner must not charge for making the register of notifications open for public inspection under what

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was Clause 18(6). Amendment No. 38 is a technical amendment which makes a small improvement to Clause 19.
Moved, That the House do agree with the Commons in their Amendment No. 34.—(Lord Falconer of Thoroton.)
Baroness O'Cathain: My Lords, I agree to Amendment No. 34. However, it does not use the word "must" but the word "shall", despite what the Minister said.
Lord Skelmersdale: My Lords, before the Minister responds to the noble Baroness, is he now advocating new drafting practice, that the word "must" shall appear generally in legislation?
Lord Falconer of Thoroton: My Lords, I stand entirely corrected by the noble Baroness, Lady O'Cathain, who has read the documents much more closely than I. She is absolutely right. Perhaps I may say in my own rather pitiful defence that I think the substance is the same.
As to the question of the noble Lord, Lord Skelmersdale, the answer is no. It is not now a practice that "must" shall always replace "may" but only when appropriate in the circumstances.
Lord Skelmersdale: My Lords, the noble and learned Lord has answered the wrong question. I was asking whether "must" shall now replace "shall".
Lord Falconer of Thoroton: My Lords, in the context of this particular Bill the word "shall" is obviously the most appropriate word to use. Whether that will be the case in every Bill I have no idea. I suspect not. It will depend on the circumstances.
On Question, Motion agreed to.
11.45 a.m.

COMMONS AMENDMENTS
35 Clause 18, page 12, line 39, after 'of' insert '(a)'.
36 Page 12, line 41, at end insert 'and
(b) such other information as the Commissioner may be authorised or required by notification regulations to include in the register'.
37 Page 13 line 12, after 'public', insert 'free of charge'.
38 Clause 19, page 13, line 36, after 'notification' insert 'under notification regulations made'.
39 Clause 21, page 14, line 1, leave out from beginning to 'processing' and insert 'In this section "assessable processing" means'.
40 Page 14, line 10, leave out from 'whether' to 'and' in line 11 and insert 'any of the processing to which the notification relates is assessable processing'.
41 Page 14, line 12, leave out 'proposed' and insert 'assessable'.
42 Page 14, line 16, leave out 'processing to which this section applies or would apply' and insert 'assessable processing'.
43 Page 14, line 18, leave out 'proposed'.
44 Page 14, line 24, leave out from 'No' to 'shall' and insert 'assessable processing in respect of which a notification
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has been given to the Commissioner as mentioned in subsection (2)'.
45 Page 14, line 25, leave out from beginning to 'either' in line 27.
46 Page 14, line 35, leave out from 'controller' to end of line 37 and insert 'is guilty of an offence'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 35 to 46 en bloc.
Moved, That the House do agree with the Commons in their Amendments Nos. 35 to 46.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENT
47 Clause 26, page 16, line 25, leave out from 'means' to first 'to' in line 26 and insert 'the provisions specified in subsection (3A)'.
Lord Falconer of Thoroton: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 47. I shall also speak to the other amendments in this group.
Amendments Nos. 47 and 48 narrow the definition of the non-disclosure provisions. Disclosures of personal data are processing for the purposes of the Bill. They must therefore be made in conformity with the data protection principles. The directive and the Bill recognise that it may be necessary to make disclosures in certain circumstances where it is not possible to comply with the principles. The purpose of the non-disclosure exemptions in Part IV is to ensure that such disclosures may be made.
Clause 26(3) as it left this House defined the "non-disclosure provisions" as including all the data protection principles except the seventh principle—which relates to security—to the extent to which they are inconsistent with the disclosure in question. We realised that this went rather too far and meant that we would be providing exemptions from parts of the regime where the directive does not permit us to do so. The purpose of Amendments Nos. 47 and 48 is to bring the definition into line with the directive.
The other amendments in this group do a different, although related, job. Amendment No. 48 refers at paragraph (c) to Clause 12(1) to (3). This means that the non-disclosure exemptions are available in respect of Clause 12(1) to (3) but not Clause 12(4).
Clause 12(1) to (3) provides what amounts to a free-standing right to rectification, blocking, erasure or destruction of personal data on the ground of their inaccuracy. In that respect it complements the fourth data protection principle. Where exemptions are provided from the fourth principle, it is necessary also to provide exemption from Clause 12(1) to (3).
But Clause 12(4) does something different. It provides a general remedy of rectification etc., where damage has been suffered and there is a substantial risk of further contravention. In this respect, it complements the general remedial provisions of Clause 11.

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At present the Bill provides a number of exemptions from the whole of Clause 12. Where it does so, it is intended only to complement exemption from the fourth principle. There is no basis for disapplying the remedial provisions of Clause 12(4) in these cases.
The effect of these amendments is to remove Clause 12(4) from the scope of the exemption provided by a number of provisions in the Bill.
Moved, That the House do agree with the Commons in their Amendment No. 47.—(Lord Falconer of Thoroton.)
On Question, Motion agreed to.

COMMONS AMENDMENT
48 Clause 26, page 16, line 27, at end insert—
'(3A) The provisions referred to in subsection (3) are—

(a) the first data protection principle, except to the extent to which it requires compliance with the conditions in Schedules 2 and 3,

(b) the second, third, fourth and fifth data protection principles, and

(c) sections 9 and 12(1) to (3).'.

Lord Falconer of Thoroton: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 48.
Moved, That the House do agree with the Commons in their Amendment No. 48.—(Lord Falconer of Thoroton.)
On Question, Motion agreed to.

COMMONS AMENDMENT
49 Clause 28, page 18, line 7, at end insert—
'(4) Personal data in respect of which the data controller is a relevant authority and which—

(a) consist of a classification applied to the data subject as part of a system of risk assessment which is operated by that authority for either of the following purposes—

(i) the assessment or collection of any tax or duty or any imposition of a similar nature, or

(ii) the prevention or detection of crime, or apprehension or prosecution of offenders, where the offence concerned involves any unlawful claim for any payment out of, or any unlawful application of, public funds, and

(b) are processed for either of those purposes,

are exempt from section 7 to the extent to which the exemption is required in the interests of the operation of the system.
(5) In subsection (4)—
"public funds" includes funds provided by any Community institution;
"relevant authority" means—

(a) a government department,

(b) a local authority, or

(c) any other authority administering housing benefit or council tax benefit.'.

Lord Falconer of Thoroton: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 49. I shall also speak to the other amendments in the group which all deal with changes to the subject information exemptions in Part IV and Schedule 7.
The House will recall that at Third Reading it decided to remove from the Bill, against the Government's advice, what was Clause 28(4). That provision would have allowed the Secretary of State by order to specify exemptions from the subject information and non-disclosure provisions. It was included to meet the particular needs of the Inland Revenue. However, the House felt that this provision was insufficiently precise, and lacking in transparency.
The noble Lord will be glad to hear that Amendment No. 49 introduces a narrower exemption, specifically to protect the public purse and hence taxpayers, in place of the former Clause 28(4). I believe that it takes full account of the concerns which were expressed about the previous version.
Since that earlier debate, the Government have done what we said we would do. First, we have carefully reviewed the particular needs of the Inland Revenue and how they might best be met. Secondly, we have reviewed what similar needs exist elsewhere in the public sector—so that we could give a clearer explanation to Parliament of the practical need for the class exemption, and so that we could consider whether the exemption could be set out wholly on the face of the Bill.
As a result, we have decided not to pursue further in this Bill the non-disclosure exemption. On reflection, we accept that, where systematic disclosure of information to government departments is appropriate, we should seek specific statutory powers within the relevant departmental legislation.
On risk assessment, we have concluded that we can deal with this on the face of the Bill in a way that should reassure the House about our intentions. Amendment No. 49 introduces a new, narrowly focused, exemption applying solely to subject access. It applies only to government departments, local authorities and other authorities administering particular benefits and payments. It applies only when they are using risk assessment systems to help collect or protect public funds. Its aim is solely to protect honest taxpayers from fraud and tax evasion.
This exemption is necessary solely to avoid a serious and adverse impact on government departments' work to prevent and detect fraudulent claims for money and to collect sums owed to the Exchequer. We must protect honest taxpayers against the depredations of the dishonest. Moreover, we propose to do so through an amendment which is narrow and clearly targeted: it exempts only risk assessment material not information on the data subject generally. Subject access to other material will continue.
I hope that the House will agree that, in bringing forward this amendment, the Government have had proper regard to the concerns of this House which led it to delete the earlier provision.

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I turn to Amendments Nos. 52 to 56. This group of amendments clarifies the subject information exemption which Clause 30 provides for certain regulatory activity in respect of the relevant functions of statutory public sector ombudsmen.
The clause as it stood when it left this House already applied in general terms to the functions of the ombudsmen. But there is a measure of doubt about whether it covered all of their functions which need to be covered. In particular, it is uncertain whether it covered the ombudsmen's functions in relation to deficiencies in the provision of services by public bodies. The purpose of the amendments is to put the matter beyond doubt.
A reference to the new Welsh administration ombudsman has also been introduced in line with developments in the Government of Wales Bill.
Moved, That the House do agree with the Commons in their Amendment No. 49.—(Lord Falconer of Thoroton.)
Baroness Nicholas of Winterbourne: My Lords, I welcome the amendment and thank the noble and learned Lord the Minister for his clear exposition of how the Government have reached this satisfactory conclusion. It is good to know that the noble and learned Lord has accepted the intellectual reasoning that was put forward from all sides of the House in the earlier debate. I feel confident that it was only pressure of time which held back the Government from putting forward at that time what I and others consider to be this exceptionally appropriate amendment.
Lord Renton: My Lords, I do not wish to be churlish and, like the noble Baroness, I broadly congratulate the Government on their changes of mind in the re-drafting of Clause 28. However, Clause 28 seems to go much further than the concern of taxpayers.
Subsection (1) states:
"Personal data processed for … the prevention or detection of crime"—
that is crime at large, not merely confined to taxpaying—
"the apprehension or prosecution of offenders"—
that also is very wide; and the subsection goes wider still—
"the assessment or collection of any tax or duty or of any imposition of a similar nature".
It is an important clause. The amendment that has been made, acceptable though it is, may give rise in years to come to problems of application rather than interpretation. Although I believe that it is wise of the Government to make this and other consequential amendments in relation to Clause 28, the way in which in future it affects the liberty of the subject should be borne in mind.
Viscount Astor: My Lords, the noble and learned Lord suffered what I might call a pincer movement at Third Reading in your Lordships' House. The noble
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Baroness, Lady Nicholson, and I, persuaded the Government to remove the clause so that we could ensure—although the Government had agreed to consider it—that the measure would come back to your Lordships' House and we would have another chance to debate it.
We welcome the changes. They are exactly what is needed. My noble friend, Lord Renton, is right: the provision is wider than just tax collection. It is about the enforcement of the law, and investigation of crime. It is limited in its purposes to the prevention and detection of crime. There is always concern that the powers will be used too widely. That was our concern when we debated the clause originally. The Government have taken that on and narrowed it. It is an issue that will always have to be considered in the future.
We welcome the clarification about the role of the ombudsmen. It is an important clarification because it provides a degree of protection for the public.
Lord Falconer of Thoroton: My Lords, perhaps I may deal with the point raised by the noble Lord, Lord Renton. The concerns expressed by the noble Viscount, Lord Astor, and the noble Baroness Lady Nicholson of Winterbottom, related to what was then Clause 28(4). Clause 28(4) gave a wide order-making power which permitted the orders to be made to exempt various aspects of the Bill. They went wider than the targeted exemption which is now set out on the face of what is now Clause 29(4). I believe that that was the concern, and not Clause 29(1).
The noble Lord is absolutely right to say that Clause 29(1) includes and refers to the prevention and detection of crime. But that was not something about which concern was expressed. That was acceptable to this House. It was the wide order-making power in what was then Clause 28(4) to which the House objected and it removed that clause altogether.
The noble Lord is right in what he says about what is now Clause 29(1) but that was not the problem. Therefore the noble Lord is right to say that it applies to crime but that was not the problem at the time. The problem was the order-making power in what was Clause 28(4). Therefore, what I said in my opening remarks was entirely accurate. It is limited to what it says in Clause 29(4).
Finally, in relation to what the noble Viscount, Lord Astor, said, I should not take credit for any of this. He will remember that we were not persuaded; we were out-voted.
On Question, Motion agreed to.

COMMONS AMENDMENTS
50 Clause 29, page 18, line 11, at end insert—
'(1A) The Secretary of State may by order exempt from the subject information provisions, or modify those provisions in relation to—

(a) personal data in respect of which the data controller is the proprietor of, or a teacher at, a school, and which consist of information relating to persons who are or have been pupils at the school, or

1497

(b) personal data in respect of which the data controller is an education authority in Scotland, and which consist of information relating to persons who are receiving, or have received, further education provided by the authority.'.

51 Page 18, line 27, at end insert'—
( ) In this section—
"education authority" and "further education" have the same meaning as in the Education (Scotland) Act 1980 ("the 1980 Act"), and
"proprietor"—

(a) in relation to a school in England or Wales, has the same meaning as in the Education Act 1996,

(b) in relation to a school in Scotland, means—

(i) in the case of a self-governing school, the board of management within the meaning of the Self-Governing Schools etc. (Scotland) Act 1989,

(ii) in the case of an independent school, the proprietor within the meaning of the 1980 Act,

(iii) in the case of a grant aided school, the managers within the meaning of the 1980 Act, and

(iv) in the case of a public school, the education authority within the meaning of the 1980 Act, and

(c) in relation to a school in Northern Ireland, has the same meaning as in the Education and Libraries (Northern Ireland) Order 1986 and includes, in the case of a controlled school, the Board of Governors of the school.'.

52 Clause 30, page 18, line 29, leave out 'section' and insert 'subsection'.
53 Page 18, line 33, leave out 'This section' and insert 'Subsection (1)'.
54 Page 18, line 42, leave out from beginning to 'or'.
55 Page 19, line 9, leave out 'this section' and insert 'subsection (2)'.
56 Page 19, line 14, at end insert—
'( ) Personal data processed for the purpose of discharging any function which—

(a) is conferred by or under any enactment on—

(i) the Parliamentary Commissioner for Administration,

(ii) the Commission for Local Administration in England, the Commission for Local Administration in Wales or the Commissioner for Local Administration in Scotland,

(iii) the Health Service Commissioner for England, the Health Service Commissioner for Wales or the Health Service Commissioner for Scotland,

(iv) the Welsh Administration Ombudsman,

(v) the Assembly Ombudsman for Northern Ireland, or

(vi) the Northern Ireland Commissioner for Complaints, and

(b) is designed for protecting members of the public against—

(i) maladministration by public bodies,

(ii) failures in services provided by public bodies, or

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(iii) a failure of a public body to provide a service which it was a function of the body to provide,

are exempt from the subject information provisions in any case to the extent to which the application of those provisions to the data would be likely to prejudice the proper discharge of that function.'.
57 Page 19, line 14, at end insert—
'( ) Personal data processed for the purpose of discharging any function which—

(a) is conferred by or under any enactment on the Director General of Fair Trading, and

(b) is designed—

(i) for protecting members of the public against conduct which may adversely affect their interests by persons carrying on a business,

(ii) for regulating agreements or conduct which have as their object or effect the prevention, restriction or distortion of competition in connection with any commercial activity, or

(iii) for regulating conduct on the part of one or more undertakings which amounts to the abuse of a dominant position in a market,

are exempt from the subject information provisions in any case to the extent to which the application of those provisions to the data would be likely to prejudice the proper discharge of that function.'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 50 to 57.
Moved, That the House do agree with the Commons in their Amendments Nos. 50 to 57.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
58 Clause 31, page 19, line 31, leave out & 12' and insert '12(1) to (3)'.
59 Clause 33, page 21, line 3, leave out '12' and insert '12(1) to (3)'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 58 and 59.
Moved, That the House do agree with the Commons in their Amendments Nos. 58 and 59.—(Lord Williams of Mostyn.)
Baroness Nicholson of Winterbourne: My Lords, I rise to ask a question of the Minister, the noble Lord, Lord Williams of Mostyn, with regard to Amendment No. 58. That exemption is a first for the United Kingdom. It has been strongly argued. Will the Minister confirm that as his Written Answer of 8th April to my noble friend Lord Lester of Herne Hill indicates, the Data Protection Bill interpretation of Clause 31 will be applied by the courts and interpreted in accordance with the European legal principles of proportionality and legal certainty?
Lord Williams of Mostyn: My Lords, I am most grateful to the noble Baroness whose nomenclature

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I think I have more accurately than my noble and learned friend the Solicitor-General. I shall explain that joke to him later. The noble Baroness gave me notice of this matter and I affirm that what I said in the Written Answer remains correct.
On Question, Motion agreed to.

COMMONS AMENDMENT
60 Clause 39, page 22, line 15, leave out 'may' and insert 'which requires the data controller to rectify, block, erase or destroy any inaccurate data may also'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 60. I shall speak also to Amendments Nos. 61 to 66 and 148.
These amendments make a number of technical changes to ensure that Clause 39 works as it should. Clause 39(1) makes provision for the issue by the data protection commissioner of enforcement notices requiring data controllers to change their practice if the commissioner is satisfied that they are contravening any of the data protection principles. Where appropriate, any enforcement notice is capable of requiring the rectification, blocking, erasure or destruction of data.
Clauses 39(3) and (4) make special arrangements for enforcement notices issued in respect of contraventions of the fourth data protection principle. Clause 39(3) provides for such a notice to require the controller to rectify, block, erase or destroy any inaccurate data and any other data he holds containing expressions of opinion which are based on inaccurate data, or to follow a special procedure in relation to inaccurate data which were received by the data controller and which he has recorded accurately.
Clause 39(4) deals with the situation where inaccurate personal data, which have been rectified and so on, have previously been disclosed to third parties. It says that an enforcement notice may, if reasonably practicable, require the data controller to tell the third parties of the rectification and so on.
The arrangements for the rectification and so on of personal data, and for notifying third party recipients of the rectification, need to apply to any breach of the data protection principles and not simply to breaches of the fourth principle. The purpose of these amendments is to ensure that they do.
Moved, That the House do agree with the Commons in their Amendment No. 60.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
61 Clause 39, page 22, line 16, leave out 'any inaccurate data and'.
62 Page 22, line 18, leave out 'or' and insert—
'(3A) An enforcement notice in respect of a contravention of the fourth data protection principle'.
63 Page 22, line 21, leave out from 'party' to second 'to' and insert 'may require the data controller either—
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(a) to rectify, block, erase or destroy any inaccurate data and any other data held by him and containing an expression of opinion as mentioned in subsection (3), or

(b)".

64 Page 22, line 28, leave out from 'notice' to 'or' in line 30 and insert 'requires the data controller to rectify, block, erase or destroy any personal data'.
65 Page 22, line 32, leave out 'were inaccurate' and insert 'had been processed in contravention of any of the data protection principles'.
66 Page 22, line 43, leave out from '(7)' to 'before' in line 44 and insert 'an enforcement notice must not require any of the provisions of the notice to be complied with'.
67 Clause 42, page 24, leave out from end of line 29 to second 'the' in line 30 and insert 'and, if such an appeal is brought,'.
68 Clause 43, page 25, line 13, leave out from 'which' to end of line 14 and insert 'proceedings have been stayed under section 31'.
69 Clause 43, page 25, leave out from end of line 42 to second 'the' in line 43 and insert 'and, if such an appeal is brought,'.
70 Clause 50, page 29, line 39, leave out 'observance' and insert 'following'.
71 Clause 52, page 30, line 10, leave out 'brings' and insert 'is an actual or prospective party to'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 61 to 71.
Moved, That the House do agree with the Commons in their Amendments Nos. 61 to 71.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENT
72 After Clause 54, insert the following new clause—
Records obtained under data subject's right of access
PROHIBITION OF REQUIREMENT AS TO PRODUCTION OF CERTAIN RECORDS
.—(1) A person must not, in connection with—

(a) the recruitment of another person as an employee,

(b) the continued employment of another person, or

(c) any contract for the provision of services to him by another person,

require that other person or a third party to supply him with a relevant record or to produce a relevant record to him.
(2) A person concerned with the provision (for payment or not) of goods, facilities or services to the public or a section of the public must not, as a condition of providing or offering to provide any goods, facilities or services to another person, require that other person or a third party to supply him with a relevant record or to produce a relevant record to him.
(3) Subsections (1) and (2) do not apply to a person who shows—

(a) that the imposition of the requirement was required or authorised by or under any enactment, by any rule of law or by the order of a court, or

(b) that in the particular circumstances the imposition of the requirement was justified as being in the public interest.

(4) Having regard to the provisions of Part V of the Police Act 1997 (certificates of criminal records etc.), the imposition of the requirement referred to in subsection (1) or (2) is not to be regarded as being justified as being in the public interest on the ground that it would assist in the prevention or detection of crime.
(5) A person who contravenes subsection (1) or (2) is guilty of an offence.
(6) In this section "a relevant record" means any record which—

(a) has been or is to be obtained by a data subject from any data controller specified in the first column of the Table below in the exercise of the right conferred by section 7, and

(b) contains information relating to any matter specified in relation to that data controller in the second column,

and includes a copy of such a record or a part of such a record.

TABLE

Data controller

Subject-matter

1. Any of the following persons—

(a) Convictions.

(b) Cautions.

(a) a chief officer of police of a police force in England and Wales.

(b) a chief constable of a police force in Scotland.

(c) the Chief Constable of the Royal Ulster Constabulary.

(d) the Director General of the National Criminal Intelligence Service.

(e) the Director General of the National Crime Squad.

2. The Secretary of State.

(a) Convictions.

(b) Cautions.

(c) His functions under section 53 of the Children and Young Persons Act 1933, section 205(2) or 208 of the Criminal Procedure (Scotland) Act 1995 or section 73 of the Children and Young Persons Act (Northern Ireland) 1968 in relation to any person sentenced to detention.

(d) His functions under the Prison Act 1952, the Prisons (Scotland) Act 1989 or the Prison Act (Northern Ireland) 1953 in relation to any person imprisoned or detained.

(e) His functions under the Social Security Contributions and Benefits Act 1992, the Social Security Administration Act 1992 or the Jobseekers Act 1995.

(f) His functions under Part V of the Police Act 1997.

3. The Department of Health and Social Services for Northern Ireland

Its functions under the Social Security Contributions and Benefits (Northern Ireland) Act 1992, the Social Security Administration (Northern Ireland) Act 1992 or the Jobseekers (Northern Ireland) Order 1995.

(7) In the Table in subsection (6)—
"caution" means a caution given to any person in England and Wales or Northern Ireland in respect of an offence which, at the time when the caution is given, is admitted;
1502
"conviction" has the same meaning as in the Rehabilitation of Offenders Act 1974 or the Rehabilitation of Offenders (Northern Ireland) Order 1978.
(8) The Secretary of State may by order amend—

(a) the Table in subsection (6), and

(b) subsection (7).

(9) For the purposes of this section a record which states that a data controller is not processing any personal data relating to a particular matter shall be taken to be a record containing information relating to that matter.
(10) In this section "employee" means an individual who—

(a) works under a contract of employment, as defined by section 230(2) of the Employment Rights Act 1996, or

(b) holds any office,

whether or not he is entitled to remuneration; and "employment" shall be construed accordingly.'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 72. I shall speak also to Amendments Nos. 75, 78 and 105.
We gave an undertaking to deal with the problem of enforced subject access. The issues are complex and we were not able to complete all the necessary work before the Bill left this House. These amendments give effect to the Government's undertaking.
Amendment No. 72 makes enforced subject access an offence in certain circumstances. We do not propose an offence lightly. Criminalising behaviour places a special duty on the Government and Parliament to focus very carefully on significant social problems. Therefore, we have put the offence in that context. It is limited to certain types of records—criminal records, prison records and DSS records.
Therefore, we are focusing on the types of records with which there is currently a problem or those to which the present problem might be displaced. The present problem is mainly with records which give information about criminal history; namely, police records or DSS contribution records where significant gaps might indicate periods in custody.
However, we are not ruling out applying the offence to other records. Under Amendment No. 78 the list is extendable by order subject to affirmative resolution in case the practice is diverted elsewhere. The offence is committed only where the data subject is required to provide the specified data. We do not wish to criminalise straight requests for information. It is perfectly legitimate for a potential employer to ask a job applicant for details of any criminal record. It should be a crime only if he requires provision of that information through the applicant's subject access right.
We are confining the offence to the types of situation in which systematic use is most likely to occur and where people are least likely to be acting in their private as distinct from their professional capacity. Those are employment and appointments which would include recruitment, continued employment, preferment or promotion; placing contracts; and providing goods, facilities or services to the public.

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We propose defences where it can be shown that the requirement was authorised by law or court order or was justified as being in the public interest. But bearing in mind the planned dedicated channel for the supply of criminal records under the Police Act 1997, the public interest defence will explicitly exclude crime prevention or detection. Anyone who has that as a genuine motive will have an alternative route to obtain appropriate information.
Because of the close link that we see with the introduction of criminal record certificates, Amendment No. 105 provides that the new clause added by Amendment No. 72 cannot be brought into force before they are available.
As with other offences under the Bill, by virtue of Clause 57, only the data protection commissioner or the Director of Public Prosecutions can prosecute. The punishment would be a fine and Amendment No. 72 also allows the court to order forfeiture, erasure or destruction of documents or other material. I commend the amendment to the House.
Moved, That the House do agree with the Commons in their Amendment No. 72.—(Lord Williams of Mostyn.)
Lord Renton: My Lords, on Amendment No. 72, which is very necessary, there is just one point on which we need clarification. Subsection (6) on page 8 refers to "a relevant record" which means a record which,
"has been or is to be obtained by a data subject from any data controller specified in the first column of the Table".
We are then told what subject matter can be provided.
We have various laws, and I am sorry that I do not carry them in my head and I have not had time to look them up, which have the effect that some convictions can no longer be used by the courts or in any other way after a period of time. It does not apply to all offences but it is a rather important provision. I remember it being passed many years ago in another place.
I very much hope that the information that can be given under that new clause and in the proposed "Table" will exclude anything which has, by the passage of time, been forbidden for use by the courts, or in any other way. If the Minster can give that undertaking, I am sure that we would all be very much happier.
Lord Williams of Mostyn: My Lords, the legislation that the noble Lord had in mind is the Rehabilitation of Offenders Act 1974. As the noble Lord quite rightly says, for a longer period of time, some convictions—and I shall not irritate the House by going into detail—are regarded as spent and, therefore, cannot be used in certain circumstances. As I understand the construction of the new clause, nothing in it will affect the protections provided by the Rehabilitation of Offenders Act. If I am wrong in that respect, I shall immediately correct myself in writing to the noble Lord.
Lord Renton: My Lords, I am most grateful to the Minister for that undertaking.
On Question, Motion agreed to.

COMMONS AMENDMENT
73 After Clause 54, insert the following new clause—
AVOIDANCE OF CERTAIN CONTRACTUAL TERMS RELATING TO HEALTH RECORDS
'.—(1) Any term or condition of a contract is void in so far as it purports to require an individual—

(a) to supply any other person with a record to which this section applies, or with a copy of such a record or a part of such a record, or

(b) to produce to any other person such a record, copy or part.

(2) This section applies to any record which—

(a) has been or is to be obtained by a data subject in the exercise of the right conferred by section 7, and

(b) consists of the information contained in any health record as defined by section (Meaning of "accessible record")(2).'.

Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 73.
Moved, That the House do agree with the Commons in their Amendment No. 73.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENT
74 Clause 56, page 33, line 6, leave out 'for reasons of substantial' and insert 'in the'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 74. The purpose of Clause 56 is to put a duty of confidentiality, subject to a criminal sanction, on the Data Protection Commissioner and her staff in respect of confidential information that they acquire in the course of their functions under the Bill. This provision flows from a requirement on member states in the directive. Article 28.7 requires us to ensure that the members and staff of our supervisory authority are subject to a duty of professional secrecy in respect of the confidential information to which they have access. There are a number of exemptions. One is where the disclosure is necessary for reasons of substantial public interest.
Amendment No. 74 was proposed by the Government in the light of representations by the Campaign for Freedom of Information, to the effect that the substantial public interest posed too stiff a test. We thought about this and we agreed, on reflection, that it would be more consistent with the approach to freedom of information, while remaining consistent with the directive, to lower this threshold to simple public interest. That is one more step in helping to ensure that, in practice, the commissioner and her staff are not impeded from doing their job effectively.
Moved, That the House do agree with the Commons in their Amendment No. 74.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.
The Chairman of Committees (Lord Boston of Faversham): My Lords, I understand that the noble Lord, Lord Milner of Leeds—and, again, I am grateful for the warning—wishes to raise a point on Amendment No. 79. Therefore, what I propose to do, with the agreement of your Lordships, is to take Amendments Nos. 75 to 78 inclusive first, and then call Amendments Nos. 79 to 105.

COMMONS AMENDMENTS
75 Clause 57, page 33, line 27, leave out 'or 54' and insert 54 or (Prohibition of requirement as to production of certain records),
( ) an offence under section 20(2) relating to processing which is assessable processing for the purposes of section 21,'.
76 After Clause 60, insert the following new clause—
'.—(1) This section applies to—

(a) a notice or request under any provision of Part II,

(b) a notice under subsection (1) of section 23 or particulars made available under that subsection, or

(c) an application under section 40(2),

but does not apply to anything which is required to be served in accordance with rules of court.
(2) The requirement that any notice, request, particulars or application to which this section applies should be in writing is satisfied where the text of the notice, request, particulars or application—

(a) is transmitted by electronic means,

(b) is received in legible form, and

(c) is capable of being used for subsequent reference.

(3) The Secretary of State may by regulations provide that any requirement that any notice, request, particulars or application to which this section applies should be in writing is not to apply in such circumstances as may be prescribed by the regulations.'.<reason>77
77 Clause 63, page 36, leave out line 35.
78 Page 36, line 38, at end insert—
'section (Prohibition of requirement as to production of certain records)(8),'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 75 to 78.
Moved, That the House do agree with the Commons in their Amendments Nos. 75 to 78.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
79 Clause 63, page 37, line 10, after '2' insert 'or 7'.
80 Page 37, line 10, after '2' insert 'or 8A'.
81 Page 37, line 10, leave out 'or'.
82 Page 37, line 11, at end insert—
'paragraph 5A of Schedule 7'.
83 Page 37, line 12 leave out 'relating' and insert 'which—

(i) prescribe cases for the purposes of subsection (2)(b),

(ii) are made by virtue of subsection (6A), or

(iii) relate'.

84 Page 37, line 14, after 8(1)' insert 'or section (Application of section 7 where data controller is credit reference agency)(3)'.
85 Page 37, line 14, at end insert—
'(cc) regulations under section (Transmission of notices etc. by electronic or other means),'.
86 Page 37, line 21, leave out 'containing' and insert 'which contains only'.
87 After Clause 63, insert the following new clause—

MEANING OF "ACCESSIBLE RECORD"
'.—(1) In this Act "accessible record" means—

(a) a health record as defined by subsection (2),

(b) an educational record as defined by Schedule (Meaning of "educational record"), or

(c) an accessible public record as defined by Schedule (accessible public records.

(2) In subsection (1)(a) "health record" means any record which—

(a) consists of information relating to the physical or mental health or condition of an individual, and

(b) has been made by or on behalf of a health professional in connection with the care of that individual.'.

88 Insert the following new clause—

MEANING OF "HEALTH PROFESSIONAL"
'.—(1) In this Act "health professional" means any of the following—

(a) a registered medical practitioner,

(b) a registered dentist as defined by section 53(1) of the Dentists Act 1984,

(c) a registered optician as defined by section 36(1) of the Opticians Act 1989,

(d) a registered pharmaceutical chemist as defined by section 24(1) of the Pharmacy Act 1954 or a registered person as defined by Article 2(2) of the Pharmacy (Northern Ireland) Order 1976,

(e) a registered nurse, midwife or health visitor,

(f) a registered osteopath as defined by section 41 of the Osteopaths Act 1993,

(g) a registered chiropractor as defined by section 43 of the Chiropractors Act 1994,

(h) any person who is registered as a member of a profession to which the Professions Supplementary to Medicine Act 1960 for the time being extends,

(i) a clinical psychologist, child psychotherapist or speech therapist,

(j) a music therapist employed by a health service body, and

(k) a scientist employed by such a body as head of a department.

(2) In subsection (1)(a) "registered medical practitioner" includes any person who is provisionally registered under section 15 or 21 of the Medical Act 1983 and is engaged in such employment as is mentioned in subsection (3) of that section.
(3) In subsection (1) "health service body" means—

1507

(a) a Health Authority established under section 8 of the National Health Service Act 1977,

(b) a Special Health Authority established under section 11 of that Act,

(c) a Health Board within the meaning of the National Health Service (Scotland) Act 1978,

(d) a Special Health Board within the meaning of that Act,

(e) the managers of a State Hospital provided under section 102 of that Act,

(f) a National Health Service trust first established under section 5 of the National Health Service and Community Care Act 1990 or section 12A of the National Health Service (Scotland) Act 1978,

(g) a Health and Social Services Board established under Article 16 of the Health and Personal Social Services (Northern Ireland) Order 1972,

(h) a special health and social services agency established under the Health and Personal Social Services (Special Agencies) (Northern Ireland) Order 1990, or

(i) a Health and Social Services trust established under Article 10 of the Health and Personal Social Services (Northern Ireland) Order 1991.'.

89 Clause 64, page 37, line 29, at end insert—
'"credit reference agency" has the same meaning as in the Consumer Credit Act 1974;'.
90 Page 37, leave out lines 41 to 45.
91 Page 38, line 8, at end insert—
'"pupil"—

(a) in relation to a school in England and Wales, means a registered pupil within the meaning of the Education Act 1996,

(b) in relation to a school in Scotland, means a pupil within the meaning of the Education (Scotland) Act 1980, and

(c) in relation to a school in Northern Ireland, means a registered pupil within the meaning of the Education and Libraries (Northern Ireland) Order 1986;'.

92 Page 38, line 19, at end insert—
'"school"—

(a) in relation to England and Wales, has the same meaning as in the Education Act 1996,

(b) in relation to Scotland, has the same meaning as in the Education (Scotland) Act 1980, and

(c) in relation to Northern Ireland, has the same meaning as in the Education and Libraries (Northern Ireland) Order 1986;

"teacher" includes—

(a) in Great Britain, head teacher, and

(b) in Northern Ireland, the principal of a school;'.

93 Page 38, line 25, at end insert—
'(2) For the purposes of this Act data are inaccurate if they are incorrect or misleading as to any matter of fact.'.
94 Clause 65, page 38, line 28, at end insert—

'accessible record

section (Meaning of "accessible record")'.

95 Page 38, line 31, at end insert—

'credit reference agency

section 64(1)'.

96 Page 38, line 40, at end insert—

'enactment

section 64(1)'.

97 Page 38, line 44, column 2, leave out 'section 64' and insert 'section (Meaning of "health professional")'.
98 Page 38, line 44, at end insert—

'inaccurate (in relation to data)

section 64(2)'.

99 Page 39, line 9, at end insert—

'pupil (in relation to a school)

section 64(1)'.

100 Page 39, line 14, at end insert—

'school

section 64(1)'.

101 Page 39, line 18, at end insert—

'teacher

section 64(1)'.

102 Page 39, leave out line 21.
103 Clause 66, page 39, line 24, leave out '24th October 2001' and insert 'the commencement of this section'.
104 Clause 69, page 39, line 39, after 'section' insert—

(ee) paragraph 17 of Schedule 5,

(ef) Schedule (Meaning of "educational record"),

(eg) Schedule (Accessible public records),'.

105 Page 40, line 3, at end insert—
'( ) The day appointed under subsection (3) for the coming into force of section (Prohibition of requirement as to production of certain records) must not be earlier than the first day on which sections 112, 113 and 115 of the Police Act 1997 (which provide for the issue by the Secretary of State of criminal conviction certificates, criminal record certificates and enhanced criminal record certificates) are all in force.'.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 79 to 105.
Moved, That the House do agree with the Commons in their Amendments Nos. 79 to 105.—(Lord Williams of Mostyn.)
Lord Milner of Leeds: My Lords, I am rather confused by Amendments Nos. 79, 80 and 81, all of which refer to line 10 on page 37 of the Bill. Amendment No. 79 reads,
"after '2' insert 'or 7",
Amendment No. 80,
"after '2' insert 'or 80,
and Amendment No. 81 proposes to leave out the word "or". Can my noble friend the Minister tell me how line 10 of that clause will read when amended?
Lord Falconer of Thoroton: My Lords, I cannot do so at present. Perhaps I may write to my noble friend in relation to his query.
On Question, Motion agreed to.

COMMONS AMENDMENT
106 Clause 69, page 40, leave out lines 7 to 10.
Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 106.
This is a purely procedural amendment. It takes away subsection (6) of Clause 69, which provides that nothing in the Bill imposes any charge on the people or on public funds. The provision was found necessary during the Bill's passage through this House—as will be notoriously well known to all but me—to avoid questions of privilege.
Moved, That the House do agree with the Commons in their Amendment No. 106.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
107 Schedule 1, page 42, line 13, after 'where' insert 'at that time'.
108 Page 42, line 15, leave out 'information contained in the data is' and insert 'data are'.
109 Page 42, line 16, leave out 'information contained in the data is' and insert 'data are'.
110 Page 43, leave out line 12.
111 Page 43, line 23, leave out from 'information' to 'in' in line 24.
112 Page 43, line 29, leave out from 'section' to 'or' in line 30.
113 Page 43, line 44, leave out 'staff and insert 'employees'.
114 Schedule 3, page 46, line 21, at end insert—
'(2) The Secretary of State may by order—

(a) exclude the application of sub-paragraph (1) in such cases as may be specified, or

(b) provide that, in such cases as may be specified, the condition in sub-paragraph (1) is not to be regarded as satisfied unless such further conditions as may be specified in the order are also satisfied.'.

115 Page 46, line 29, at end insert—
'8A.—(1) The processing—

(a) is of sensitive personal data consisting of information as to racial or ethnic origin,

(b) is necessary for the purpose of identifying or keeping under review the existence or absence of equality of opportunity or treatment between persons of different racial or ethnic origins, with a view to enabling such equality to be promoted or maintained, and

(c) is carried out with appropriate safeguards for the rights and freedoms of data subjects.

(2) The Secretary of State may by order specify circumstances in which processing falling within sub-paragraph (1)(a) and (b) is, or is not, to be taken for the purposes of sub-paragraph (1)(c) to be carried out with appropriate safeguards for the rights and freedoms of data subjects.'.
116 Schedule 7, page 53, line 6, at end insert—
'Corporate finance
5A.—(1) Where personal data are processed for the purposes of, or in connection with, a corporate finance service provided by a relevant person—

(a) the data are exempt from the subject information provisions in any case to the extent to which either—

(i) the application of those provisions to the data could affect the price of any instrument which is already in existence or is to be or may be created, or

(ii) the data controller reasonably believes that the application of those provisions to the data could affect the price of any such instrument, and

(b) to the extent that the data are not exempt from the subject information provisions by virtue of paragraph (a), they are exempt from those provisions if the exemption is required for the purpose of safeguarding an important economic or financial interest of the United Kingdom.

(2) For the purposes of sub-paragraph (1)(b) the Secretary of State may by order specify—

(a) matters to be taken into account in determining whether exemption from the subject information provisions is required for the purpose of safeguarding an important economic or financial interest of the United Kingdom, or

(b) circumstances in which exemption from those provisions is, or is not, to be taken to be required for that purpose.

(3) In this paragraph—
"corporate finance service" means a service consisting in—

(a) underwriting in respect of issues of, or the placing of issues of, any instrument,

(b) advice to undertakings on capital structure, industrial strategy and related matters and advice and service relating to mergers and the purchase of undertakings, or

(c) services relating to such underwriting as is mentioned in paragraph (a);

"instrument" means any instrument listed in section B of the Annex to the Council Directive on investment services in the securities field (No. 93/22/EEC), as set out in Schedule 1 to the Investment Services Regulations 1995;
"price" includes value;
"relevant person" means—

(a) any person who is authorised under Chapter III of Part I of the Financial Services Act 1986 or is an exempted person under Chapter IV of Part I of that Act,

(b) any person who, but for Part III or IV of Schedule I to that Act, would require authorisation under that Act,

(c) any European investment firm within the meaning given by Regulation 3 of the Investment Services Regulations 1995,

(d) any person who, in the course of his employment, provides to his employer a service falling within paragraph (b) or (c) of the definition of "corporate finance service", or

(e) any partner who provides to other partners in the partnership a service falling within either of those paragraphs.'.

117 Page 54, leave out lines 1 to 7.
118 Page 54, line 14, leave out 'if and insert 'to the extent that'.
119 Schedule 8, page 54, line 39, after first 'data' insert other than data forming part of an accessible record,'.
120 Page 54, line 40, at end insert—
'(2) This paragraph does not apply to eligible manual data to which paragraph 2B applies.'.
121 Page 54, line 40, at end insert—
'2A.—(1) This paragraph applies to—

(a) eligible manual data forming part of an accessible record, and

(b) personal data which fall within paragraph (d) of the definition of "data" in section 1(1) but which, because they are not subject to processing which was already under way immediately before 24th October 1998, are not eligible data for the purposes of this Schedule.

(2) During the first transitional period, data to which this paragraph applies are exempt from—

(a) the data protection principles, except the sixth principle so far as relating to sections 7 and 13A,

1511

(b) Part II of this Act, except—

(i) section 7 (as it has effect subject to section 8) and section 13A, and

(ii) section 14 so far as relating to those sections, and

(c) Part III of this Act.'.

122 Page 54, line 40, at end insert—
'2B.—.(1) This paragraph applies to eligible manual data which consist of information relevant to the financial standing of the data subject and in respect of which the data controller is a credit reference agency.
(2) During the first transitional period, data to which this paragraph applies are exempt from—

(a) the data protection principles, except the sixth principle so far as relating to sections 7 and 13A,

(b) Part II of this Act, except—

(i) section 7 (as it has effect subject to sections 8 and (Application of section 7 where data controller is credit reference agency)) and section 13A, and

(ii) section 14 so far as relating to those sections, and

(c) Part III of this Act.'.

123 Page 57, leave out lines 6 to 12.
124 Page 57, line 16, leave out from beginning to 'are' in line 17 and insert—
'13.—(1) This paragraph applies to—

(a) eligible manual data which were held immediately before 24th October 1998, and

(b) personal data which fall within paragraph (d) of the definition of "data" in section 1(1) but do not fall within paragraph (a) of this sub-paragraph,

but does not apply to eligible manual data to which the exemption in paragraph 15 applies.
(2) During the second transitional period, data to which this paragraph applies'.
125 Page 57, line 22, leave out '12' and insert '12(1) to (3)'.
126 Page 57, leave out lines 23 and 24.
127 Page 57, line 36, leave out '12' and insert '12(1) to (3)'.
128 Page 58, line 5, leave out '12' and insert '12(1) to (3)'.
129 Page 58, line 14, at end insert—

'PART V

  EXEMPTION FROM SECTION 21
  . Processing which was already under way immediately before 24th October 1998 is not assessable processing for the purposes of section 21.'.
  130 Schedule 9, page 58, line 34, at end insert 'as is mentioned in that sub-paragraph'.
  131 After Schedule 10, insert the following new schedule—

'SCHEDULE

  MEANING OF "EDUCATIONAL RECORD" FOR PURPOSES OF SECTION (MEANING OF "ACCESSIBLE PUBLIC RECORD")
  1. For the purposes of section (Meaning of "accessible record") "educational record" means any record to which paragraph 2, 5 or 7 applies.
  England and Wales
  2. This paragraph applies to any record of information which—

  (a) is processed by or on behalf of the governing body of, or a teacher at, any school in England and Wales specified in paragraph 3,

  (b) relates to any person who is or has been a pupil at the school, and

  (c) originated from or was supplied by or on behalf of any of the persons specified in paragraph 4,

  other than information which is processed by a teacher solely for the teacher's own use.
  3. The schools referred to in paragraph 2(a) are—

  (a) a school maintained by a local education authority, and

  (b) a special school, as defined by section 6(2) of the Education Act 1996, which is not so maintained.

  4. The persons referred to in paragraph 2(c) are—

  (a) an employee of the local education authority which maintains the school,

  (b) in the case of—

  (i) a voluntary aided, foundation or foundation special school (within the meaning of the School Standards and Framework Act 1998), or

  (ii) a special school which is not maintained by a local eduction authority,

  a teacher or other employee at the school (including an educational psychologist engaged by the governing body under a contract for services),

  (c) the pupil to whom the record relates, and

  (d) a parent (as defined by section 576(1) of the Education Act 1996) of that pupil.

  Scotland
  5. This paragraph applies to any record of information which is processed—

  (a) by an education authority in Scotland, and

  (b) for the purpose of the relevant function of the authority,

  other than information which is processed by a teacher solely for the teacher's own use.
  6. For the purposes of paragraph 5—

  (a) "education authority" means an education authority within the meaning of the Education (Scotland) Act 1980 ("the 1980 Act") or, in relation to a self-governing school, the board of management within the, meaning of the Self-Governing Schools etc. (Scotland) Act 1989 ("the 1989 Act"),

  (b) "the relevant function" means, in relation to each of those authorities, their function under section 1 of the 1980 Act and section 7(1) of the 1989 Act, and

  (c) information processed by an education authority is processed for the purpose of the relevant function of the authority if the processing relates to the discharge of that function in respect of a person—

  (i) who is or has been a pupil in a school provided by the authority, or

  (ii) who receives, or has received, further education (within the meaning of the 1980 Act) so provided.

  Northern Ireland
  7.—(1) This paragraph applies to any record of information which—

  (a) is processed by or on behalf of the Board of Governors of, or a teacher at, any grant-aided school in Northern Ireland,

  (b) relates to any person who is or has been a pupil at the school, and

  (c) originated from or was supplied by or on behalf of any of the persons specified in paragraph 8,

  1513
  other than information which is processed by a teacher solely for the teacher's own use.
  (2) In sub-paragraph (1) "grant-aided school" has the same meaning as in the Education and Libraries (Northern Ireland) Order 1986.
  8. The persons referred to in paragraph 7(1) are—

  (a) a teacher at the school,

  (b) an employee of an education and library board, other than such a teacher,

  (c) the pupil to whom the record relates, and

  (d) a parent (as defined by Article 2(2) of the Education and Libraries (Northern Ireland) Order 1986) of that pupil.

  England and Wales: transitory provisions
  9.—(1) Until the appointed day within the meaning of section 20 of the School Standards and Framework Act 1998, this Schedule shall have effect subject to following modifications.
  (2) Paragraph 3 shall have effect as if for paragraph (b) and the "and" immediately preceding it there were substituted—

  "(aa) a grant-maintained school, as defined by section 183(1) of the Education Act 1996,

  (ab) a grant-maintained special school, as defined by section 337(4) of that Act, and

  (b) a special school, as defined by section 6(2) of that Act, which is neither a maintained special school, as defined by section 337(3) of that Act, nor a grant-maintained special school."

  (3) Paragraph 4(b)(i) shall have effect as if for the words from "foundation", in the first place where it occurs, to "1998)" there were substituted "or grant-maintained school".'.
  132 Insert the following new schedule—

'SCHEDULE

  ACCESSIBLE PUBLIC RECORDS
  Meaning of "accessible public record"
  1. For the purposes of section (Meaning of "accessible record") "accessible public record" means any record which is kept by an authority specified—

  (a) as respects England and Wales, in the Table in paragraph 2,

  (b) as respects Scotland, in the Table in paragraph 4, or

  (c) as respects Northern Ireland, in the Table in paragraph 6,

  and is a record of information of a description specified in that Table in relation to that authority.
  Housing and social services records: England and Wales
  2. The following is the Table referred to in paragraph 1(a).

  TABLE OF AUTHORITIES AND INFORMATION

  The authorities

  The accessible information

  Housing Act local Authority.

  Information held for the purpose of any of the authority's tenancies.

  Local social services authority.

  Information held for any purpose of the authority's social services functions.

  3.—(1) The following provisions apply for the interpretation of the Table in paragraph 2.
  (2) Any authority which, by virtue of section 4(e) of the Housing Act 1985, is a local authority for the purpose of any provision of that Act is a "Housing Act local authority" for the purposes of this Schedule, and so is any housing action trust established under Part III of the Housing Act 1988.
  (3) Information contained in records kept by a Housing Act local authority is "held for the purpose of any of the authority's tenancies" if it is held for any purpose of the relationship of landlord and tenant
  1514
  of a dwelling which subsists, has subsisted or may subsist between the authority and any individual who is, has been or, as the case may be, has applied to be, a tenant of the authority.
  (4) Any authority which, by virtue of section 1 or 12 of the Local Authority Social Services Act 1970, is or is treated as a local authority for the purposes of that Act is a "local social services authority" for the purposes of this Schedule; and information contained in records kept by such an authority is "held for any purpose of the authority's social services functions" if it is held for the purpose of any past, current or proposed exercise of such a function in any case.
  (5) Any expression used in paragraph 2 or this paragraph and in Part II of the Housing Act 1985 or the Local Authority Social Services Act 1970 has the same meaning as in that Act.
  Housing and social services records: Scotland
  4. The following is the Table referred to in paragraph 1(b).

  TABLE OF AUTHORITIES AND INFORMATION

  The authorities

  The accessible information

  Local authority. Scottish Homes.

  Information held for the purpose of any of the body's tenancies.

  Social work authority.

  Information held for any purpose of the authority's functions under the Social Work (Scotland) Act 1968 and the enactments referred to in section 5(1B) of that Act.

  5.—(1) The following provisions apply for the interpretation of the Table in paragraph 4.
  (2) "Local authority" means—

  (a) a council constituted under section 2 of the Local Government etc. (Scotland) Act 1994,

  (b) a joint board or joint committee of two or more of those councils, or

  (c) any trust under the control of such a council.

  (3) Information contained in records kept by a local authority or Scottish Homes is held for the purpose of any of their tenancies if it is held for any purpose of the relationship of landlord and tenant of a dwelling-house which subsists, has subsisted or may subsist between the authority or, as the case may be, Scottish Homes and any individual who is, has been or, as the case may be, has applied to be a tenant of theirs.
  (4) "Social work authority" means a local authority for the purposes of the Social Work (Scotland) Act 1968; and information contained in records kept by such an authority is held for any purpose of their functions if it is held for the purpose of any past, current or proposed exercise of such a function in any case.
  Housing and social services records: Northern Ireland
  6. The following is the Table referred to in paragraph 1(c).

  TABLE OF AUTHORITIES AND INFORMATION

  The authorities

  The accessible information

  The Northern Ireland Housing Executive.

  Information held for the purpose of any of the Executive's tenancies.

  A Health and Social Services Board.

  Information held for the purpose of any past, current or proposed exercise by the Board of any function exercisable, by virtue of directions under Article 17(1) of the Health and Personal Social Services (Northern Ireland) Order 1972, by the Board on behalf of the Department of Health and Social Services with respect to the administration of personal social services under—

  (a) the Children and Young Persons

  Act (Northern Ireland) 1968;

  (b) the Health and Personal Social Services (Northern Ireland) Order 1972;

  (c) Article 47 of the Matrimonial Causes (Northern Ireland) Order 1978;

  (d) Article 11 of the Domestic Proceedings (Northern Ireland) Order 1980;

  (e) the Adoption (Northern Ireland) Order 1987; or

  (f) the Children (Northern Ireland) Order 1995.

  An HSS trust

  Information held for the purpose of any past, current or proposed exercise by the trust of any function exercisable, by virtue of an authorisation under Article 3(1) of the Health and Personal Social Services (Northern Ireland) Order 1994, by the trust on behalf of a Health and Social Services Board with respect to the administration of personal social services under any statutory provision mentioned in the last preceding entry.

  7.—(1) This paragraph applies for the interpretation of the Table in paragraph 6.
  (2) Information contained in records kept by the Northern Ireland Housing Executive is "held for the purpose of any of the Executive's tenancies" if it is held for any purpose of the relationship of landlord and tenant of a dwelling which subsists, has subsisted or may subsist between the Executive and any individual who is, has been or, as the case may be, has applied to be, a tenant of the Executive.'.
  133 Schedule 11, page 61, line 46, leave out 'eligible' and insert 'exempt'.
  134 Page 61, line 46, after 'inaccurate' insert 'or incomplete'.
  135 Page 61, line 47, leave out 'eligible' and insert 'exempt'.
  136 Page 62, line 2, after 'inaccurate' insert 'or incomplete'.
  137 Page 62, leave out lines 13 to 17 and insert—
  —exempt manual data" means—

  (a) in relation to the first transitional period, as defined by paragraph 1(2) of Schedule 8, data to which paragraph 2A or 2B of that Schedule applies, and

  (b) in relation to the second transitional period, as so defined, data to which paragraph 13 of that Schedule applies;'.

  138 Page 62, leave out lines 18 and 19.
  139 Page 62, line 19, at end insert—
  '(5) For the purposes of this section personal data are incomplete if, and only if, the data, although not inaccurate, are such that their incompleteness would constitute a contravention of the third or fourth data protection principles, if those principles applied to the data.'.
  140 Page 62, leave out line 20.
  141 Page 62, leave out lines 22 to 24 and insert—
  '(a) in subsection (2) after "section 13" there is inserted—
  1516
  "(dd) section 13A,", and.
  (b) in subsection (4) after "13(8)" there is inserted ", 13A(3)".'.
  142 Page 62, line 25, leave out 'section 12' and insert 'section 12(1) to (3)'.
  143 Page 62, line 25, leave out &12' and insert '12(1) to (3)'.
  144 Page 62, line 25, at end insert—
  '4A. In section 52(1) after "13(8)" there is inserted ", 13A(3)".'.
  145 Schedule 12, page 62, line 46, leave out from first 'period' to end of line 48 and insert ', in relation to a person, means—

  (a) where there is a single entry in respect of that person as a data user, the period at the end of which, if section 8 of the 1984 Act had remained in force, that entry would have fallen to be removed unless renewed, and

  (b) where there are two or more entries in respect of that person as a data user, the period at the end of which, if that section had remained in force, the last of those entries to expire would have fallen to be removed unless renewed.'.

  146 Page 63, line 22, leave out '16' and insert &18'.
  147 Page 63, leave out lines 24 to 27.
  148 Page 64, line 49, at end insert—
  '. Subsection (4)(b) of section 39 does not apply where the rectification, blocking, erasure or destruction occurred before the commencement of that section.'.
  149 Page 65, line 5, at end insert—
  '. Where by virtue of paragraph 10 an information notice is served on the basis of anything done or omitted to be done before the day on which section 42 comes into force, subsection (2)(b) of that section shall have effect as if the reference to the data controller having complied, or complying, with the new principles were a reference to the data controller having contravened the old principles by reason of any such act or omission as is mentioned in paragraph 10.'.
  150 Page 65, line 5, at end insert—
  'Self-incrimination, etc.
  .—(1) In section 42(9), section 43(10) and paragraph 11 of Schedule 7, any reference to an offence under this Act includes a reference to an offence under the 1984 Act.
  (2) In section 34(9) of the 1984 Act, any reference to an offence under that Act includes a reference to an offence under this Act.'.
  151 Page 65, line 24, at end insert—
  'Applications under Access to Health Records Act 1990 or corresponding Northern Ireland legislation
  .—(1) The repeal of any provision of the Access to Health Records Act 1990 does not affect—

  (a) the application of section 3 or 6 of that Act in any case in which the application under that section was received before the day on which the repeal comes into force, or

  (b) the application of section 8 of that Act in any case in which the application to the court was made before the day on which the repeal comes into force.

  (2) Sub-paragraph (1)(a) does not apply in relation to an application for access to information which was made by reference to this Act.
  .—(1) The revocation of any provision of the Access to Health Records (Northern Ireland) Order 1993 does not affect—

  (a) the application of Article 5 or 8 of that Order in any case in which the application under that Article was received before the day on which the repeal comes into force, or

  (b) the application of Article 10 of that Order in any case in which the application to the court was made before the day on which the repeal comes into force.

  (2) Sub-paragraph (1)(a) does not apply in relation to an application for access to information which was made by reference to this Act.
  Applications under regulations under Access to Personal Files Act 1987 or corresponding Northern Ireland legislation
  .—(1) The repeal of the personal files enactments does not affect the application of regulations under those enactments in relation to—

  (a) any request for information,

  (b) any application for rectification or erasure, or

  (c) any application for review of a decision,

  which was made before the day on which the repeal comes into force.
  (2) Sub-paragraph (1)(a) does not apply in relation to a request for information which was made by reference to this Act.
  (3) In sub-paragraph (1) "the personal files enactments" means—

  (a) in relation to Great Britain, the Access to Personal Files Act 1987, and

  (b) in relation to Northern Ireland, Part II of the Access to Personal Files and Medical Reports (Northern Ireland) Order 1991.'.

  152 Page 65, line 24, at end insert—
  'Applications under section 158 of Consumer Credit Act 1974
  . Section 59 does not affect the application of section 158 of the Consumer Credit Act 1974 in any case where the request was received before the commencement of section 59, unless the request is made by reference to this Act.'.
  153 Schedule 13, page 66, leave out lines 24 to 29.
  154 Page 66, line 33, leave out "'the Access to Health Records Act 1990"' and insert '"the Data Protection Act 1998"'.
  155 Page 67, leave out lines 2 to 4 and insert—
  '10. Schedule 2 to the Education (Student Loans) Act 1990 (loans for students) so far as that Schedule continues in force shall have effect as if the reference in paragraph 4(2) to the Data Protection Act 1984 were a reference to this Act.'.
  156 Page 67, leave out lines 6 to 8 and insert—
  '12. For section 2 of the Access to Health Records Act 1990 there is substituted—
  "Health professionals.
  2. In this Act "health professional" has the same meaning as in the Data Protection Act 1998."'.
  157 Page 67, line 12, at end insert—
  '13A. In section 5(3) of that Act (cases where right of access may be partially excluded) for the words from the beginning to "record" in the first place where it occurs there is substituted "Access shall not be given under section 3(2) to any part of a health record".'.
  158 Page 67, line 22, leave out '"the Access to Health Records (Northern Ireland) Order 1993"' and insert '"the Data Protection Act 1998"'.
  159 Page 67, leave out lines 37 to 39 and insert—
  '17. For paragraphs (1) and (2) of Article 4 of the Access to Health Records (Northern Ireland) Order 1993 there is substituted—
  "(1) In this Order "health professional" has the same meaning as in the Data Protection Act 1998."'.
  160 Page 67, line 43, at end insert—
  '18A. In Article 7 of that Order (cases where right of access may be partially excluded) for the words from the beginning to "record" in the first place where it occurs there is substituted "Access shall not be given under Article 5(2) to any part of a health record".'.
  161 Schedule 14, page 68, line 9, at end insert—

  '1987 c. 37.

  The Access to Personal Files Act 1987.

  The whole Act.'

  162 Page 68, line 11, at end insert—

  '1988 c. 50.

  The Housing Act 1988.

  In Schedule 17, paragraph 80.

  1990 c. 23.

  The Access to Health Records Act 1990.

  In section 1(1), the words from "but does not" to the end.

  In section 3, subsection (1)(a) to (e) and, in subsection (6)(a), the words "in the case of an application made otherwise than by the patient".

  Section 4(1) and (2).

  In section 5(1)(a)(i), the words "of the patient or" and the word "other".

  In section 10, in subsection (2) the words "or orders" and in subsection (3) the words "or an order under section 2(3) above".

  In section 11, the definitions of "child" and "parental responsibility".'

  163 Page 68, line 25, column 3, leave out 'Section 38(2)(a) and (4)' and insert 'Section 38'.
  164 Page 68, line 26, column 3, leave out 'Section 38(3)(a) and (5)' and insert 'Section 38'.
  165 Page 68, line 27, at end insert—

  '1994 c. 19.

  The Local Government (Wales) Act 1994.

  In Schedule 13,paragraph 30.'

  166 Page 68, line 29, at end insert—

  1519

  '1994 c. 39.

  The Local Government etc. (Scotland) Act 1994.

  In Schedule 13, paragraph 154.'

  167 Page 68, line 35, at end insert—

  'S.I. 1991/1707 (N.I. 14).

  The Access to Personal Files and Medical Reports (Northern Ireland) Order 1991.

  Part II. The Schedule.

  168 Page 68, line 39, at end insert—

  S.I. 1993/1250 (N.I. 4).

  The Access to Health Records (Northern Ireland) Order 1993.

  In Article 2(2), the definitions of "child" and "parental responsibility".

  In Article 3(1), the words from "but does not include" to the end.

  In Article 5, paragraph (1)(a) to (d) and, in paragraph (6)(a), the words "in the case of an application made otherwise than by the patient".

  Article 6(1) and (2).

  In Article 7(1)(a)(i), the words "of the patient or" and the word "other".

  S.I. 1994/429 (N.I. 2).

  The Health and Personal Social Services (Northern Ireland) Order 1991.

  In Schedule 1, the entries relating to the Access to Personal Files and Medical Reports (Northern Ireland) Order 1991.

  169 Page 68, line 43, at end insert—

  'S.I. 1995/755 (N.1. 2).

  The Children (Northern Ireland) Order 1995.

  In Schedule 9, paragraphs 177 and 191.'

  Lord Williams of Mostyn: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 107 to 169.
  Moved, That the House do agree with the Commons in their Amendments Nos. 107 to 169.—(Lord Williams of Mostyn.)
  On Question, Motion agreed to.

  Education (Northern Ireland) Order 1998
  12.15 p.m.
  The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Dubs)The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Dubs) rose to move, That the draft order laid before the House on 8th June be approved.
  The noble Lord said: My Lords, the order will introduce in Northern Ireland some provisions of the Education Act 1996, Education Act 1997 and certain elements of education policy set out in the draft Teaching and Higher Education Bill and the School Standards and Framework Bill. It will also implement certain other proposals that the Government have for education policy in the Province. The main provisions to be introduced will be in relation to discipline, assessments and pupils' performance, performance and management of schools, pre-school education, teacher-related issues, financing of schools and the development of Irish-medium education. A number of other miscellaneous provisions are also included.
  The order was considered by a wide range of educational interests in Northern Ireland. All of their comments were carefully considered and, as a result, a number of minor changes have been made to the draft order. I am grateful for the interest shown by those who took the trouble to respond. I believe that it will be helpful to the House if I say a few words about the main provisions of the order.
  The Department of Education carried out a comprehensive review of discipline during 1997 and found that the standard of behaviour in schools is generally good and that most schools feel that they can cope with their discipline problems, given appropriate support; and, indeed, that they wish to do so. Articles 3 to 6 will strengthen the position of schools in relation to discipline and good behaviour and will underpin the range of support initiatives in this area, which were announced as part of the Northern Ireland School Improvement Programme which the Minister for Education in Northern Ireland announced in February.
  It might be helpful if I included some comments about Articles 86 and 87 at this stage, as they are linked to discipline. These articles, which parallel legislation in England and Wales, provide a legal basis for the establishment of pupil referral units which will provide short-term support in behaviour management for seriously disruptive pupils so that they can be re-integrated back into their usual school. A small number of such units already exist, and these have proved successful in modifying behaviour to enable pupils to return to their normal schools and take full advantage of the education provided for them.
  Article 86 also provides the statutory basis for the development of alternative education provision for the very small number of pupils who could not be returned to a mainstream school because they exhibit deep-seated disaffection. The provision will be developed on a multi-disciplinary, multi-agency basis, drawing on the expertise in the education sector, and other agencies such as social services and the Probation Service, to develop appropriate programmes. The limited provision of this type which already exists has focused on the acquisition of basic skills and employability and, in many cases, has been successful in engaging the interest of these young people.
  Articles 7 to 13 set out a range of measures related to pupil assessment and to target-setting and development planning in schools. In particular, Articles 7 to 9 provide

  1521
  the statutory basis for the baseline assessment of primary school pupils in their first year of compulsory education. It is intended that a single scheme for baseline assessment in Northern Ireland will be drawn up and introduced at an appropriate pace with adequate training and support for the teachers involved.
  Articles 11 and 13 will provide for schools to set and publish annual targets for the performance of their pupils, within the context of development plans. The setting of targets and the drawing up of development plans provide an important context for the work done in schools, and increased stimulus for improvement. They are key components of our strategy for improvement of school performance. We intend to make target-setting a statutory requirement from the 1998–99 school year. The requirement to draw up development plans will be introduced at a later date by Appointed Day provision to allow time for the necessary training and support for schools.
  The order provides a new power in circumstances where a school is judged to be failing to provide an acceptable standard of education for its pupils, and this is judged to be wholly or partly the result of actions or inactions on the part of the board of governors. Where the Education and Training Inspectorate reports that a board of governors is contributing to a school's failure, the Department of Education will be empowered to appoint additional members to the board of governors, including a chairman, to remedy the shortcomings of the board of governors.
  I do not expect that this power will be used often, but where it is used there will be full consultation with the relevant interests. Governors of schools are hard-working and committed people and I wish to place on record the Government's gratitude for the work they do. But, where problems arise, I consider it vital that steps can be taken to put things right and so enable the school to provide the education to which the pupils are entitled.
  Article 15 extends the duty placed on a board of governors of a school to include within their annual report the measures or revised arrangements which they have taken to safeguard pupils and staff while at school. This provision arises from one of the recommendations of the Working Group on School Security set up by the DfEE following the fatal stabbing of the London head teacher, Phillip Lawrence. I am sure your Lordships will fully support this measure, which brings the law in Northern Ireland into line with that in England and Wales and is consistent with government aims to encourage greater parental involvement and partnership in schools.
  Article 16 provides for a statutory limit to be prescribed on class sizes in Key Stage 1 (Years 1–4 in Northern Ireland) in grant-aided primary schools. The intention is to limit the size of primary school infant classes to 30. This reflects the importance the Government attach to the promotion of effective learning in the early years of education and is to be introduced as quickly as possible, depending on decisions on spending levels. Schools will be required
  1522
  to comply with the statutory limit, subject to any exceptions approved by the education and library boards.
  Part V of the order provides for a programme of expansion of pre-school education in Northern Ireland. The long-term aim is to provide a full-year pre-school education place for every child whose parents wish it. This programme will be planned at local level to meet the needs of children and their parents. Places will be secured through pre-school education development plans which will be drawn up and implemented through partnership between the education and library boards and other providers of pre-school education in the statutory, private and voluntary sectors.
  Chapter I of Part V gives the Department of Education for Northern Ireland powers to determine quality standards for pre-school education and to monitor these through the Education and Training Inspectorate. Noble Lords will be glad to hear that it also removes an existing legislative bar on nursery provision in the integrated education sector.
  Chapter II of Part V introduces new arrangements for the admission of children to grant-aided nursery schools and nursery classes at primary schools to ensure effective use of nursery provision and equity of access to pre-school education.
  Chapter 1 of Part VI of the order provides for the establishment of the General Teaching Council for Northern Ireland. The council, as in Scotland, England and Wales, will be the major body to advise the Department of Education and employing authorities in Northern Ireland on the standards of entry to the profession, the structure and content of initial teacher training courses, the career development and performance management of teachers and standards of teaching and teachers' conduct. It will have professional responsibility for registering teachers and excluding from teaching those found guilty of misconduct after due process.
  I am grateful to those who took the time to respond to the draft order and the consultation paper on the establishment of the council. Both were considered by a wide range of educational interests. Their views show considerable support both for the establishment of a council, and for the proposal that it should be representative of a broad range of interests, among which members of the teaching profession should represent the single largest group.
  The order provides the framework of the council and its functions. The exact detail of the council's composition, the registration requirements, and the arrangements for levying registration fees will be set out in draft regulations on which there will again be wide-ranging consultations by the department. In view of the further consultation and planning which needs to be undertaken, the Government have set a target to bring the council into operation in the year 2000.
  Chapter II of Part VI of the order enables regulations to be made prescribing the eligibility conditions which must be met in order to be considered for employment as a principal of a grant-aided school, and in particular to hold a qualification approved by the department. It

  1523
  also provides exemption from the regulations of acting principals and those appointed to principal posts before the regulations become law. Consultations on this issue indicated strong support for the new qualification, which will be phased in from next year and which will become a compulsory requirement for headship as soon as there is a sufficient pool of qualified candidates to fill principal vacancies.
  Article 43 re-enacts, with minor amendments, Articles 143 and 153 of the 1989 order, which relate to schemes for the employment of teachers by the Council for Catholic Maintained Schools and education and library boards respectively. The schemes will continue but they will no longer require the department's approval. It also discontinues the requirement in education law for an agreement to be entered into between a teacher and the employer on the terms and conditions of employment. These are matters which are subject to general employment legislation.
  The thrust of Part VII of the order is to provide for the transfer of funding responsibility for voluntary grammar schools and grant-maintained integrated schools from the Department of Education to the education and library boards. Because of the complexities of the previous legislation governing the financing of schools, it has been necessary at the same time to consolidate the existing provisions, with minor modifications and tidying up, while incorporating the new provisions transferring the funding responsibility. May I emphasise to the House that the only fundamental change which the transfer initiates is simply a change of paymaster from DENI to the boards. The reasons for it are very straightforward.
  My colleague has indicated in public on several occasions that he does not think that it is defensible, equitable or sensible to have seven different funding formulae for allocating resources to schools in Northern Ireland and has made clear that this Government's policy objective will be to secure commonality across the Province. This will ensure that schools with the same needs will have the same level of funding, regardless of the area or the schools sector in which they are located. I know that this will take time to achieve and that much consultation with all education interests will be necessary, but solid and sensible progress has already been made with the introduction of a number of changes for 1998–99 which will bring the funding formulae much closer together. Thus the proposals in this part of the order will contribute to commonality by reducing the number of funding formulae in operation from seven to five and thus promote greater equity, consistency and transparency of funding across all schools.
  It has been put to my colleague with some force, during extensive consultation on the draft order, that such a transfer will somehow mean that the unique ethos and management arrangements which currently exist, particularly in the voluntary grammar school sector, will be somehow damaged or lost. This is simply not so. Voluntary grammar schools and grant-maintained integrated schools will continue to manage their own affairs without interference from boards; the draft order does not give the boards any role in the day-to-day
  1524
  management of these schools. Voluntary grammar and grant-maintained integrated schools would not, therefore, lose their identities and simply become the same as controlled schools, nor would there be any new restrictions on their present freedom as to how they use their resources.
  It has also been suggested that boards will somehow spirit away funds from voluntary grammar schools and grant-maintained integrated schools for use elsewhere. Again, this is not the case. The new funding arrangements will recognise their significant financial differences in terms of VAT, rates, maintenance etc. The draft order contains safeguards to reflect this: it gives the department a clear approval role, not only in respect of all aspects of the LMS formula arrangements and how they apply to the voluntary grammar and grant-maintained integrated sector, but also in respect of boards' annual financial schemes. These measures should provide ample reassurance to the sectors that boards will not be able to divert funds away from these schools' budgets.
  Articles 73 to 80 consolidate the existing provisions relating to the powers and duties of the Northern Ireland Council for the Curriculum, Examinations and Assessment, which are currently contained in four orders in council, and expand those powers to require or empower CCEA: to publicise the arrangements for baseline assessment; to develop and publish criteria for the accreditation of relevant external qualifications and to accredit qualifications which meet the criteria; to produce guidance and teaching materials for the curriculum of pre-school-age children; and, in exercising its functions, to have regard, as far as is relevant, to the requirements of industry and commerce and of persons with special learning needs.
  Article 81 consolidates existing provisions related to the approval of qualifications by the Department of Education, which are intended to ensure that the qualifications offered are acceptable and appropriate and are part of the nationally recognised framework of qualifications.
  Article 82 extends the period during which pupils can avail of work experience to include all of Key Stage 4. Article 83 makes provision for institutions of further education, on behalf of schools, to provide secondary education for pupils at Key Stage 4 within arrangements made by education and library boards.
  Both of these provisions are designed to allow schools more flexibility to provide a curriculum matched to the needs of the individual child. Article 83 has been amended from the original draft to make it clear that any provision made by an institution of further education is in fact on behalf of a school and that pupils remain on the school roll.
  The order also introduces some technical amendments to education legislation which are designed to remove any remaining doubt about the powers of education and library boards to enter into contracts which may be appropriate under the private finance initiative. This mirrors the legislative provisions made for local authorities in Great Britain.
  Article 89 lays a statutory duty on the Department of Education to encourage and facilitate the development of Irish-medium education and gives powers for the funding of a promotional body or bodies. These provisions will bring Irish-medium education onto a similar footing to integrated education.
  These are the main provisions of the order, which I believe will help enhance the education system in Northern Ireland. I beg to move.
  Moved, That the draft order laid before the House on 8th June be approved.—(Lord Dubs.)
  12.30 p.m.
  Lord Wallace of Saltaire: My Lords, I welcome that extremely helpful and comprehensive explanation of the order. I apologise that a relatively inexpert representative is speaking from these Benches in the unavoidable absence of the noble Lord, Lord Holme of Cheltenham, and my noble friend Lord Alderdyce, who is in Northern Ireland.
  The Liberal Democrats welcome this order. We particularly welcome the stress on pre-school and primary education. It seems to us more and more to be the key to improving education throughout the United Kingdom. We are not entirely happy with the idea that one can bring school numbers down in primary schools by means of statutory legislation. One cannot entirely build bricks without straw. Clearly, there will have to be extra funding for primary schools. Looking round this Chamber I see no other university teachers present, but it should be said that some of us recognise that the shift in education spending will move away from higher education towards primary schools.
  I note that Article 88 refers to the private finance initiative. My party has some hesitations about the private finance initiative. It is not an entirely cost-free element in education funding. It simply puts off spending for later years. There are large questions in regard to education as to what can most easily be funded through the PFI. Computers, information technology and other resources that have a fast depreciation rate are not easy to fund by private means.
  We are very glad to see the encouraging references to integrated education. However, we regret that more is not being done. I understand that, currently, one in every 40 pupils in Northern Ireland attends an integrated school. The pressure for pupils to attend integrated schools means that demand is higher than the current provision. Clearly it is a matter of public policy to encourage that growth. I was a candidate in the North West of England, and was well aware at that time in Manchester of the resistance to integrated education from different sections of the community. Clearly, within the current circumstances in Northern Ireland, we wish by all means to encourage that.
  I wish to mention one final small point. On page 100 Schedule 3 sets out criteria for the disqualification of members of the Northern Ireland Council for the Curriculum, Examinations and Assessment. I am puzzled that the disqualification criteria include not only bankruptcy but anyone who has made "an arrangement
  1526
  with his creditors". I have made an arrangement with my creditors for the purpose of buying a house and undertaking a mortgage. I merely question how loose the phrasing should be.
  With those exceptions, on behalf of my Liberal Democrat colleagues I welcome the order. I hope that it will contribute to a more useful and integrated education system in Northern Ireland.
  12.35 p.m.
  Lord Cope of Berkeley: My Lords, my first observation relates to the size, as well as the nature, of the order. It demonstrates the difficulties of direct rule as practised by successive governments over the past three decades or so. It is simply not a proper parliamentary procedure to put up 116 pages for discussion in a single debate with no possibility of amendment. Whatever it is, it is not proper parliamentary procedure.
  I realise that the Government have consulted widely, and I commend them on that consultation. But that is not parliamentary government, or even representative democracy. The point is particularly relevant just now. As was clear from the Minister's opening remarks, the order represents rather a motley collection of different educational matters flowing from different sources. There is no real theme to the order as a whole. Secondly, many of these matters might more satisfactorily have been left to the Assembly, which has now begun its work.
  I am beginning to get the impression, given the volume of orders for both affirmative and negative procedure that are coming forward, that the Northern Ireland Office is, as it were, trying to empty its in-tray and get everything through as soon as possible before the Assembly is under way. There may be a suspicion that democracy will be slightly more difficult to manage than direct rule. I happen to think that it would be useful for the Assembly's in-tray to be full of what might be termed normal bread-and-butter legislation; it would be likely to spend less time discussing the very contentious matters which people all too easily fall into discussing in Northern Ireland politics.
  I recognise that there was some momentum behind many of the proposals in the order at the time when the agreement was reached and the Assembly began to become a reality. But since then Ministers have not, as it were, backed off and said, "We shall not proceed with that for the time being". They have, instead, crammed on speed and added to this order.
  It is not as if education in Northern Ireland was bad and needed urgent action in order to rescue it. On the contrary, it is recognised as good by both those who take an outside interest in it and by parents. When I was a Northern Ireland Minister and visited Army families, it was a notable feature of life in Northern Ireland that the aspect of a long tour there that was welcomed by wives and soldiers alike was that their children would be able to attend the local schools. That was very much appreciated.
  The Minister explained that a considerable number of the changes are based on English educational arrangements. If English education had been recognised

  1527
  as better than Northern Ireland education over the past few years, that might be more acceptable. The reasons why Northern Ireland education is better go back beyond direct rule; they are older than that. It is better as a result of arrangements that were made at the time when Northern Ireland had its own assembly of a different kind, its own parliament. It set up the arrangements.
  I wish to mention one or two matters of a more detailed nature arising from the order. The general teaching council is one of the items in the order which is modelled on the England and Wales legislation, which is being considered separately. I was not clear. I thought I heard the Minister say in his introduction that the general teaching council would have powers to oversee the conduct of teachers. I take it, therefore, that it would have powers to strike teachers off the register for professional misconduct. I believe that that provision is to be included in the Great Britain legislation. I could not spot it in the Northern Ireland legislation, but perhaps it is one of the powers that is left to regulation and will be brought in later—delegated legislation creating further delegated legislation.
  I welcome the provisions for the testing of pupils, the publication of performance targets, and so on. As far as class sizes are concerned, it would be helpful if the Minister could tell us a little more about how class sizes of 30 and under are to be achieved in primary schools and over what time-scale. Of course, they could be achieved simply by going against parents' wishes to send their children to a particular school and forcing the children to go to another school. There is also a question of finance. Are the schools to which parents would like to send their children to be given additional classes to enable the class sizes to come down? That is obviously the most desirable way of doing it. I should be grateful for any comments the Minister can make on that point.
  The Minister was able to make some reassuring points to the voluntary grammar schools on the changes to the funding formulas. I believe that that is a matter which could at this stage have been left to the Assembly and the new executive to sort out. As the Minister said, moving to what is apparently regarded as a fairer funding formula is inevitably a slow matter. It is inevitable that some schools will be disadvantaged in any change of this kind. For that reason, the matter should proceed slowly and with the maximum amount of local acceptance. I believe that, as events have turned out, this aspect of the order could have been postponed and gone into the in-tray of the new Assembly.
  Lord Dunleath: My Lords, I believe that I am the sole representative from Northern Ireland present in the Chamber today. I know that many of my colleagues have returned to the Province with a great deal of concern, as I shall shortly.
  I totally agree with the remarks of the noble Lord, Lord Cope, about the standards of education in Northern Ireland and about the benefits which service children enjoy at Northern Ireland schools. I was sent to a school in this country, about 30 miles from your Lordships' House, of a type of which perhaps Members on the
  1528
  Government Benches would not wholly approve. However, my wife and I took a conscious decision to send our own children to school in Northern Ireland. Our daughter has just finished her A-levels at a voluntary grammar school in Belfast and we have two boys currently at a separate voluntary grammar school in Belfast.
  I too welcome the information which the Minister gave so clearly, as he always does, on the provision of additional funding for voluntary grammar schools and integrated schools. In particular, I am very pleased that the boards of governors and head teachers of these voluntary schools will still have the wherewithal to decide how to apply the funds they are given and that the power is not to be vested in the education and library boards. That is a welcome move. I have no problems with the order before us today.
  Lord Dubs: My Lords, I am grateful for the general support for the order. I will deal with the points which were made, not necessarily in the same order.
  The noble Lord, Lord Cope, commented on the length of the order and criticised the parliamentary procedure for scrutinising it. I have a lot of sympathy with that point. All being well, these are matters which will in future be dealt with by the Assembly, which will no doubt develop its own ways of scrutinising them.
  The noble Lord asked why the order was not left to the Assembly and said that there was a danger that the Assembly might have an empty in-tray. I can assure the noble Lord that the Government's concern is that the Assembly's in-tray will, if anything, be far too full by the time it ceases to be in shadow mode and takes over full powers early next year, I hope. The danger is that if we load the new Assembly with too much to do, there will be an enormous burden on individual Members and on Ministers in the early days and it will take rather longer for them to get round to some of these bread-and-butter issues than would otherwise be the case.
  Another consideration is that if the Government were now to leave everything to the new Assembly, there would be a policy and decision-making vacuum for the next seven or eight months. I do not believe that that would be healthy in terms of politics; it would not represent good government; and it would not be in the interests of the people of Northern Ireland, who surely expect government to continue and decisions to be made, particularly on a matter such as this which has been subject to such extensive consultation. I assure the noble Lord that the Assembly's in-tray will not be empty, but I do not believe that it would be proper for us to delay matters. Under that argument, there are many other matters of government policy and decision-making which would presumably also be left, and I am not sure that that would be a happy way of proceeding.
  The order was initially prepared when the talks were at an early stage and there was at that point no assurance that the talks would reach the successful conclusion that occurred on Good Friday.
  Some of the powers in the order are essential. Without them it will not be possible to move for the benefit of Northern Ireland schools on a range of issues which

  1529
  have widespread support, such as pre-school education, school improvement programmes and school development plans. As the noble Lord conceded, the order was subject to widespread consultation. We shall consult further in any instances where further enactment is needed to introduce any of its provisions. I believe that the order has such widespread support that it would be wrong for us not to proceed.
  A question was asked about the general teaching council. The power of the council as to the removal of teachers from the register will be included in the regulations which will be made under the order.
  I was asked how the department intended to implement the class-size policy in Northern Ireland. The scale of the matter is substantially less in Northern Ireland than in England and Wales. In addition, the structural and funding arrangements for education in Northern Ireland are quite different from those which exist in England and Wales. A working group of representatives of the Department of Education, the five education and library boards and the Council for Catholic Maintained Schools is currently developing the detailed arrangements for the implementation of the policy on a standard basis across the Province. Resources will be available to schools from the department via education and library boards, when necessary, to assist them to comply with the policy. It is expected, however, that the great majority of schools will be able to comply with the policy without additional assistance.
  I was asked whether additional funds would be available to implement the new class-size policy. This policy is a key priority. Subject to the outcome of the comprehensive spending review, additional funds will be made available to support it. However, as I said, many schools should be able to meet the statutory requirement by the effective use of existing teaching resources and possibly the reorganisation of class structures.
  I appreciate the positive support for integrated education from the noble Lord, Lord Wallace of Saltaire. The Government will continue to support well-founded proposals for new integrated schools in the primary and secondary sectors. We are committed to doing that and the order extends support to integrated education in the pre-school sector.
  I can assure the noble Lord therefore that we are committed to integrated education. Of course, the speed with which we can move forward depends not just on overall support—one can quote statistics of support in Northern Ireland—but also on support in specific areas so that one can establish an integrated school of an adequate size. There is a difficulty therefore in the transition process, but we are moving forward as rapidly as possible.
  The noble Lord asked also about the comment in Schedule 3 in relation to creditors. These are common provisions which have been in existence since 1990. There have been no objections from any source in two public consultations and of course the power would not he exercised unreasonably. Therefore, although the
  1530
  noble Lord raised the matter as something which might cause concern, it is an established way of operating and no one seems to have objected to it.
  As regards the public finance initiative, again raised by the noble Lord, Lord Wallace of Saltaire, of course that is not a panacea for all ills. However, it is a useful way of raising additional resources for education and, as such, the Government are committed to using the PFI whenever appropriate. There are specific areas of educational provision—the noble Lord mentioned computers—where the PFI approach might not work as well as in other aspects of education. But our commitment is there. We want to use the PFI as well as other means of raising the money necessary to continually improve education in Northern Ireland. I commend the order to the House.
  On Question, Motion agreed to.

  Producer Responsibility Obligations (Northern Ireland) Order 1998
  12.51 p.m.
  Lord Dubs Lord Dubs rose to move, That the draft order laid before the House on 1st June be approved.
  The noble Lord said: My Lords, the main purpose of the draft Producer Responsibility Obligations (Northern Ireland) Order is to introduce in Northern Ireland provisions on producer responsibility in line with those already in force in Great Britain under Sections 93 to 95 of the Environment Act 1995.
  The order will also enable the Department of the Environment for Northern Ireland to make regulations to implement European Community requirements.
  The powers in the order will be used in the first instance to make producer responsibility regulations to place statutory obligations on businesses to meet recovery and recycling targets, thus enabling Northern Ireland to comply with the requirements of Article 6(1) of the EC directive on packaging and packaging waste.
  We are all aware of the pressing need to find better ways of dealing with the waste which we produce through the development of more sustainable waste management practices. According to the most recent figures available, the amount of packaging waste currently going to landfill in the United Kingdom amounts to over 10 million tonnes per annum. This is clearly a figure which none of us wishes to see continued, let alone increased. Indeed, we want to reduce it. Sustainable waste management must therefore involve every individual, every household, every business and every district council in trying to find a better alternative. In fact, I recently announced the publication of a draft waste management strategy for Northern Ireland which seeks to move waste disposal away from landfill and up the waste hierarchy towards recycling and recovery.
  I appreciate that the details of this order are somewhat technical and to that extent may sound dull when I describe them. But to ordinary people who have the misfortune to live near a landfill site, these matters are

  1531
  neither dull nor pedantic; they are of importance to them because most of those people would like to have no site at all or less waste going into the site. I am convinced that the future policy on waste is something which will affect everybody and in order to have an effective waste strategy we will need the active co-operation of households, councils, businesses and all others concerned with the matter. Therefore, it is not a dull issue, even though the details of the order appear dull at first glance.
  The introduction of the legislation on producer responsibility will further the aims of the strategy and make a valuable contribution to the Government's sustainable development approach to the environment, but without imposing an undue burden upon smaller businesses. In that regard, it is estimated that the legislation will capture 90 per cent. of all packaging waste while placing an obligation upon only 10 per cent. of businesses in Northern Ireland. It is an impressive statistic that 10 per cent. of all businesses contribute 90 per cent. of all packaging waste. It is therefore the larger businesses which will be particularly involved.
  The order should be of especial interest to the House because it is a piece of legislation which is not simply being imposed on industry out of the blue. It is, rather, the fruit of a long and constructive debate with a wide range of industry representatives on the best and most equitable means of ensuring that producers assume responsibility for the impact upon the environment of the materials and articles which they manufacture.
  There has been widespread consultation with business in the United Kingdom. A consultation paper was published in Northern Ireland in 1996. The result of those consultations was the formulation of the shared producer responsibility concept which spreads the burden across the business sectors involved. It was also concluded that recovery and recycling targets could be met but not on a voluntary basis. Legislation would be necessary both to avoid free-riders and to provide an incentive for business-operated schemes to organise recovery and recycling to meet the targets.
  It was also recognised that all sectors of the packaging chain would have to be involved, from raw materials manufacturers and convertors of that raw material into packaging through to packer-fillers and sellers to the final user.
  That, in essence, is the content of the order. It is designed on the one hand to comply with specific aims as regards the recovery and recycling of waste materials and on the other to ensure that individual businesses may choose the method of compliance which best suits their own business operation.
  The order achieves those objectives by introducing provisions which, while strengthening environmental law and ensuring that Northern Ireland can implement national, EC and international obligations, do not offer any barrier to competition or free trade. The regulations will set annual tonnage and turnover thresholds. Only those businesses which both have an annual turnover of over £5 million per annum and handle 50 tonnes or more of packaging per annum will be subject to the
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  regulations. This means that all small business will be exempt from any obligations. The regulations will also provide for businesses to meet their statutory obligations, if they so choose, through membership of exemption schemes for joint compliance. What this means in practice is that in return for the payment of a fee, an exemption scheme will assume the legal obligations of its member companies and arrange for the required tonnages of waste packaging materials to be recycled on their behalf.
  In Great Britain, the duties of registration and monitoring of obligated companies that this legislation entails are being carried out by the Environment Agency in England and Wales and by the Scottish Environmental Protection Agency north of the Border. In Northern Ireland that role will be carried out by the Environment and Heritage Service, an executive agency of the Department of the Environment for Northern Ireland which already carries out a similar regulatory and monitoring role in respect of other environmental controls.
  The business community in Northern Ireland was initially consulted about a shared responsibility approach to the legislation in November 1996. Those consulted included members of the packaging chain, the waste and recycling sector, major manufacturers and retail chains, trade and industry federations, district councils, environmental groups and other interested parties. There were, of course, a number of concerns regarding the costs and practicalities involved in meeting the proposed targets. However, the response was on the whole favourable and in accord with the Government's ongoing commitment to achieving a more sustainable approach to dealing with the impact of waste upon the environment.
  We have been mindful of the importance of ensuring that the economic cost of implementing the order should not discriminate against any sector of industry. I am pleased to be able to reassure the House that the operation of the legislation will be the subject of detailed scrutiny. I beg to move.
  Moved, That the draft order laid before the House on 1st June be approved.—(Lord Dubs.)
  1 p.m.
  Lord Randall of St. Budeaux: My Lords, I welcome this statutory instrument because it takes important steps towards improving our environment. I like the idea that manufacturers should take responsibility for the by-products that arise through manufacturing processes.
  There is always a problem in achieving a balance between environmental protection and waste management. I should like my noble friend to explain more about the impact the order will have on small firms. He said that it would not be a burden on small firms but went on to describe the exemption scheme, which, on the face of it, sounded rather good. However, fees will be associated with that exemption scheme. This worries me very much because the role of SMEs and micro-companies is so important to the development of the economy, not just in Northern Ireland but throughout the whole of the United Kingdom. We have to ensure

  1533
  that we do not increase the burdens on such developing companies in a way that would impair their rate of development, their productivity and their ability to re-invest.
  Accordingly, I would be most obliged if my noble friend could give the House some assurances on the impact that the order will have on SMEs and what protection it will offer them so as to ensure that their performance and development are not impaired.
  Lord Wallace of Saltaire: My Lords, we on these Benches welcome the order. We do not find anything boring about sustainable development or about reducing the level of waste produced by industry and consumers throughout the country. We welcome the underlying objectives of the order. I merely wish to make a number of brief points, partly general and partly related specifically to Northern Ireland.
  As the noble Lord, Lord Randall, suggested, it is a matter of achieving a balance between imposing burdens on business and promoting sustainability. I notice that Article 3(b)(d) refers to minimising the bureaucratic burden on firms. We all recognise that that is exactly where the balance has to be struck and that is where detailed regulations prepared for specific industries have to be implemented. We welcome the idea of regulations tailored to specific industries.
  Secondly, the definition in Article 3 of the re-use, recovery and recycling of products implicitly extends to encouraging extended use of materials. It is often much more environmentally friendly simply to extend the use of something rather than to waste resources by providing packaging which is re-usable and which is then re-churned through the system.
  Thirdly, Article 4(5) specifies that the revenue from any fees or levies raised under regulations shall be paid directly into the Consolidated Fund. As the Minister will be aware, my party has spent some time thinking about the need to increase trust in the tax system by providing a greater degree of visibility between what is taxed and what taxes are spent on. There should be a degree of hypothecation here; for example, the extent to which taxes raised on producer responsibility should be related to cleaning up the rivers. That is very much the way forward.
  Lastly, Article 6 deals with the liability of the Crown. We are all conscious that the Crown is a rather larger element in the Northern Ireland economy than in the rest of the country. I ask the Minister for reassurance that Article 6 will be interpreted in such a way as not to let the Crown off the hook in terms of its responsibilities in producing waste.
  Lord Cope of Berkeley: My Lords, like other noble Lords who have spoken, I welcome the ideas behind the order and the objective it is trying to achieve. The order results from long and good consultation started under the previous government and carried on by the present one. But, from the parliamentary point of view, this is a very unsatisfactory way of legislating. The order is subject to the affirmative procedure, which is what we are now engaged in, but the sole purpose of the order is
  1534
  to create powers for regulations to be introduced by the negative procedure. In a sense it is a dodge to get round the affirmative procedure. I should like the Minister to tell us what progress has been made on the regulations and with the consultation on them. They are the meat of the whole matter.
  There is little detail in the order. The Minister referred to quite a number of matters which are not in the order but which will appear in the regulations to follow. One example is the matter of small businesses, referred to by the noble Lord, Lord Randall of St. Budeaux. The Minister referred to a 50—tonne limit. That is not in the order but it is intended to be in the regulations. However, the regulations may not be introduced into this House at all. By that time responsibility may have passed to the Assembly; it certainly will a short time after, if all goes smoothly, as we hope it will. It is not insignificant that many regulations set up offences for which people can be charged and fined, which is usually but I always think amusingly described as, "On summary conviction, to a fine not exceeding the statutory maximum." I am not sure why it is necessary to express the matter that way. It is one of the disadvantages of not being a lawyer, although, on the whole, I find that an advantage in parliamentary discussions.
  The order opens up the way for a whole series of regulations which we have not yet seen. That is the important part of the order. The regulations are clearly intended to do things which we support, but the detail of them will also be important to, among others, small businesses.
  I have one other point. The Minister may not be able to deal with it straightaway but it arises indirectly from the order. I am told that planning permission has been given for a waste incineration plant on Belfast Lough which is expected to deal with much of the waste that comes out of Belfast. That will be a major matter. If the Minister is in a position to update us on how that is coming along and what is now expected in respect of the plant, it would be helpful background information in considering the order.
  Lord Dubs: My Lords, I am grateful to noble Lords for their general support for the order and what it is intended to achieve. Perhaps I may deal with the specific points that were raised. My noble friend Lord Randall was quite properly concerned about the effect on small firms. I shall explain how the system will work.
  Small firms which have a turnover of under £5 million a year and which create packaging waste of under 50 tonnes a year will not be subject to the regulations. The point about the exemption scheme is that large firms may either collect their own packaging waste and deal with it in accordance with the regulations or they may use other firms who specialise in that activity to collect it for them. The firms can be exempt from having to collect the waste, but they must ensure that they comply with the need to meet the percentage targets. For example, a firm in the retailing business might use a lot of packaging which is taken home by consumers and disposed of. Therefore, it would be difficult for the firm to go to the consumers to collect

  1535
  the waste. Clearly, it would contract a specialised firm to collect the appropriate amount of waste to enable it to meet the target. That is how such a firm would be exempt from having to collect the waste itself. The two concepts are different, but I can assure the noble Lord that we do not intend to impose a burden on small businesses. Those below the threshold will be exempt from the provisions of the regulations.
  However, I very much hope that small businesses will act in the spirit of the regulations and do their best to minimise packaging waste. After all, the object of the regulations is not to impose a financial burden on businesses but to give them an incentive to produce less waste in their activities. That is the desired aim.
  Lord Randall of St. Budeaux: My Lords, I am grateful to my noble friend for that answer. The micro-companies and the small SMEs would be protected, which shows considerable insight. Nevertheless, information regarding the structure of the fees associated with the exemption scheme for companies above the £5 million and 50—tonne figures would be helpful to the House.
  Lord Dubs: My Lords, it would be best if I were to write to the noble Lord and send copies to other noble Lords who have taken part in the debate. The issue is complicated and I am not sure that I can deal with it accurately. It would take a lot of time to do so. Perhaps my noble friend will bear with me and I shall write to him.
  Lord Cope of Berkeley: My Lords, I am grateful to the Minister for giving way. I am sorry for interrupting him. Can he confirm that as regards small business exemptions below 50 tonnes and so forth he is stating the Government's intention for the regulations? No limit is specified in the order; the figure could be 1 tonne or even nil. The order does not specify 50 tonnes; the Minister is merely telling us that that is the Government's intention as regards the regulations. The information is valuable—I asked for particulars of the regulations—but it is an example.
  Lord Dubs: My Lords, the noble Lord is right. In answer to another question which he posed, the regulations are likely to come before Parliament, not before the new Assembly, as we hope to have them laid before the end of the year. He will be able to take part in further debates about the regulations before they come into effect.
  The noble Lord, Lord Cope, asked about the general progress of the regulations. The draft regulations were published for consultation on 26th June and consultation is taking place with a wide range of interested parties, including industry and district councils. More than 500 companies have been consulted. We are undertaking a proper and widespread consultation on the regulations which will come before this House, all being well, before the end of this year.
  1536
  The noble Lord, Lord Wallace of Saltaire, also asked about the regulations. They will encourage the re-use of packaging by exempting re-used packaging such as bottles which are returned and refilled. We wish to encourage such a process. It may seem old-fashioned to return to bottles which are used more than once, but it is a sensible way forward. I hope that the regulations will give full effect to that.
  The noble Lord also asked about the position of the Crown. Article 6 applies the order to the Crown. That means that there is no exemption for government departments or other Crown bodies. In practice, it is unlikely that they will be conducting a business to which the regulations would apply. However, I take the spirit of the noble Lord's comment. In this, as in other matters connected with the environment, it is important that government departments should set the lead and set a good example. Other people can then say, "If Government do that, it is reasonable for us to follow." I refer to a whole range of issues concerned with sustainable development and the "greening" of government generally. However, it is unlikely that such regulations for businesses will apply to the operation of government departments.
  Finally, the noble Lord, Lord Wallace of Saltaire, asked about the Consolidated Fund. I hear what he says, but I am not sure that I can change Treasury policy quite so easily. I note his point, which is that any moneys going to Northern Ireland should stay there for Northern Ireland purposes.
  I thank noble Lords for their support and I look forward to their contributions in debates when the regulations come before us.
  On Question, Motion agreed to.

  Pensions (Amendment) Bill [H.L.]
  1.16 p.m.
  Lord Morris of Manchester: My Lords, I beg to move that this Bill be now read a second time.
  Of all the duties it falls to Parliament to discharge none is of more compelling priority than our bounden duty to act justly to men and women who were prepared to lay down their lives for this country and the dependants of those who did so. It is that duty the Bill's supporters will be addressing in this debate. Sadly, we shall be doing so at a time of continuing distress for hundreds of the men and women who served in the Gulf conflict. Having been fit and well when they went to the Gulf more than seven years ago, many are now very seriously ill. Their illnesses are still undiagnosed. Others have gone to their graves with a deep sense of injustice, leaving behind aggrieved dependants, some of them wives who are widowed while young and fear poverty when they are old.
  There can be little doubt that had the provisions of this Bill been in force seven years ago their problems and needs, as well as those of others in the ex-service community with unresolved claims, would have been seen in far sharper focus in Whitehall and Westminster and subjected to much closer public and parliamentary

  1537
  scrutiny. The Bill has been most warmly welcomed by the ex-service community. Like me, they are well aware of the work of the Central Advisory Committee on War Pensions. Indeed, I used to chair the committee 24 years ago. But many who know most about its work today feel that it has become a vehicle for government pronouncements rather than for debate in depth about the concerns of war pensioners.
  "Over the years", says one CAC veteran, "the committee's role has changed in practice and its value has declined". A main purpose of this Bill is to ensure that the ex-service community and Parliament can take an informed and considered view of the adequacy of service, war and war widows' pensions and related benefits. The Central Advisory Committee might itself be asked to contribute to the compilation of the annual report for which the Bill provides. At the very least it should be free to debate the report.
  It was said recently:
  "They are a unique group of workers because of the nature of the work they do, the hours they put in and the places in which they operate".
  That may sound like a quotation from a campaigning trade union leader in support of a bumper pay rise. In fact, as my noble friend Lord Haskel will doubtless have recognised, they are the words of a ministerial colleague of ours when justifying, on 3rd February 1998, the exclusion of the Armed Forces, and only the Armed Forces, from the legislation for a national minimum wage. Never was there clearer recognition by a government of the unique status of the Armed Forces as public servants of the nation. Whatever the challenge, they unfailingly respond with total professionalism and commitment. They reflect huge credit on this country and inspire both national pride and international envy. It is not the quality of their equipment but the qualities of the men and women who serve in them that set our Armed Forces apart from others.
  But what of their rewards and provision for the security of their families? They are employed by the biggest employer in Europe—the Ministry of Defence—whose reputation as an employer is of fundamental importance to the Government's moral authority in exhorting other employers to adopt forward-looking employment policies, as they frequently do. All government departments have a responsibility to act as good and caring employers, but its size puts a special onus on the Ministry of Defence to be seen as a model employer, in terms not only of rewards for serving personnel but also of dignified provision for those who have completed their service. The MoD's standing as an employer is indeed best judged by its treatment of service pensioners.
  Yet several cases that give cause for concern have been drawn to my attention in anticipation of this debate. The first is that of Catherine Koe, the widow of an Army major. Her husband served for 32 years and his early death in 1971 was hastened by the studied inhumanity and barbarous cruelties of existence in a Japanese prisoner-of-war camp. Mrs. Koe has lived on
  1538
  a meagre one-third rate pension for the past 27 years because the 1956 pension code, under which her husband retired, paid the lowest rate of military pension of any pension code since 1945. I am sure that your Lordships' House will feel that Mrs. Koe deserved—and deserves even more now as an elderly widow—very much better than that from the country her husband served with so much dedication and undoubted courage.
  Another cause for concern is the case of Audrey Osland who married her late husband after he completed 30 years in the RAF, including the whole of the Second World War. Sadly, his first wife died before he left the RAF and, because he completed his service before April 1978 and remarried after retirement, Mrs. Osland receives not one penny in widow's pension. That case, too, must cause concern in all parts of this House, more especially since it shows the MoD falling lamentably short of best practice in the private sector.
  Again, even in cases where the widow is receiving a pension based on her husband's military service under the Armed Forces pension scheme her pension, like that of a war widow, is withdrawn if she remarries. This is in stark contrast even with normal practice in the private sector, where a widow's pension is awarded to her for life regardless of her future marital status. Again, it conflicts with the report of Sir Michael Bett's independent review of the Armed Forces Pension Scheme, which states that he and his team,
  "found the practice of stopping a widow's pension on remarriage unsatisfactory".
  Sir Michael recommended that,
  "In line with private sector practice, a widow's pension should be payable for life".
  This has already been adopted in the civilian public service, for example, by the pension scheme of local government officers. So what possible justification can there be now, not only for failing to lead but lagging far behind the private sector and ignoring Sir Michael Bett's recommendation on so sensitive an issue?
  The intention of the noble Lord, Lord Freyberg, to speak on the Bill makes this an evocative moment for me. We used to speak, to the same effect, each in our own House; but now we can speak as one in the same House. I know that, as before, he will add eloquently to the voices calling for more dignified provision for service and war pensioners and their dependants. Meanwhile, if I am not allowed to call him "my noble friend", which in literal truth he is, I hope that it is permissible at least for me to describe him as "my noble associate". I do so having long been delighted to strive with him for improvements in provisions that are now in place and for others we are seeking to justify today.
  Turning now, in the order of the Bill, to war and war widows' pensions, I am indebted to my noble friend Lord Gilbert and his ministerial colleagues—notably the noble Baroness, Lady Hollis—for reacting so quickly to my plea in the debate on Gulf War illnesses in February for an end to the delay in granting a war pension to Gunner Tom Ford, late of 2nd Field Regiment, Royal Artillery, who came back from the Gulf in broken and rapidly deteriorating health (Hansard, 2/2/98; cols. 480 to 481). To be awarded one's entitlement to a war

  1539
  pension, as I was reminded by that case, is no passport to a dolce vita. On the contrary, it recalls that moving passage from Kipling,
  "Think where 'e's been,
  Think what 'e's seen,
  Think of his pension—
  An' Gawd save the Queen"
  It was the Royal British Legion that asked me to raise Gunner Ford's case and they share my pleasure that, within two weeks of the debate on 2nd February, he received an interim award that was followed within three weeks by an ongoing war pension of 70 per cent. So anyone who thinks that speaking in your Lordships' House cuts little ice might reflect on the speed and understanding with which my noble friends reacted to that debate.
  As with service pensions, there are nevertheless many causes for concern in relation to war and war widows' pensions. One which heavily underlines the case for this Bill, drawn to my attention by Tom House of the Royal British Legion, is that of Margaret Davies who has now waited four years for a compensation payment to which both the DSS and the Lord Chancellor's Department accept her entitlement. Unfortunately for Mrs. Davies, however, the MoD does not agree and continues to pay her not a war widow's pension but only that of a widow whose husband's death was in no way attributable to his service in the Armed Forces. I cannot believe that, if this Bill had already been law, that kind of anomaly would not have been addressed sooner. I hope profoundly that it will now be urgently reviewed by the Government and with the same result as that in the case of Gunner Tom Ford.
  I know that the noble Earl, Lord Effingham, will also be commenting on war pensions, which he does with so much authority, and also how very grateful the War Widows' Association of Great Britain are that my noble friend Lady Dean will speak on their concerns. But there are some issues of general importance that it may be helpful for me to touch upon briefly. The first concerns the need for additional help for ageing war pensioners with severe disabilities. With increasing age the problems of disability intensify and multiply. The average age of war pensioners now makes this a majority problem among them. Lieutenant Colonel Ray Holland of the British Limbless Ex-Servicemens Association (BLESMA) informs me that they have recently put to my noble friend Lady Hollis and her department a proposal to introduce two new age additions. I know my noble friend will want to do whatever she can to help and, since the cost involved is relatively small, I hope very much that she may soon be able to act on the proposal.
  This is a very appropriate day for our debate and to remind ourselves how greatly indebted we should all be to those whom BLESMA came into existence to assist, for while in another place they are debating provisions in the Landmines Bill to save people from mutilation, we are met to give more dignity to the remaining years of men and women who are already mutilated and who lost their limbs, acting on our behalf, that others across the world might live in peace, comfort and security.
  1540
  Total spending on war and war widows' pensions will cost £137 million less this year, at constant prices, than in 1993–94. This is not because the value of individual pensions and allowances has been reduced, but because the number of pensioners is falling year by year as their average age increases and more and more of the war disabled and bereaved die. Thus simply by holding expenditure on war and war widows' pensions at its present level for a few years, we could make this a time for more generosity to Britain's ageing and ever more needful war pensioners.
  With no increase in overall spending we could then also do more to meet the claims of the war widows, for whom my noble friend Lady Dean will speak and for whom the noble Baroness, Lady Strange, would have spoken had she not, very sadly, been prevented by an accident from being with us. She will be deeply missed in this debate.
  My submission today has been informed by, among others, Major General Peter Bonnet and Robin Markes of the Officers' Pension Society; Colonel Terry English of the Royal British Legion; Iris Thorogood, Jenny Green and Irene Bloor of the War Widows' Association of Great Britain, as well as by Tom House and Lieutenant-Colonel Ray Holland. For them and for those in whose service they spend their lives, I commend this Bill to the House. I beg to move.
  Moved, That the Bill be now read a second time—(Lord Morris of Manchester.)
  1.32 p.m.
  Lord Vivian: My Lords, I congratulate the noble Lord, Lord Morris of Manchester, on bringing this Bill to your Lordships' House today. I cannot give greater support to what he has already said in respect of our servicemen and women. Our sailors, soldiers and airmen are unique, as the noble Lord stated. They are the people who provide the defence of the realm and the security of the nation to enable the rest of us to live in peace and tranquillity in our own country. They are the people who risk their lives and who are prepared to make the supreme sacrifice whenever required for the sake of their country.
  I submit that there are widespread areas in the Armed Forces pension scheme which are profoundly unfair. All of us, including the noble Lord the Minister, who have any connection with pensions for our servicemen and women, should feel a deep sense of shame. We should make a much greater and more determined effort to correct the injustices in the pension scheme to ensure that when they leave the Armed Forces, their pensions are sound and fair.
  All the services are under strength—some more so than others. The Army, with its very welcome increase of 3,300 personnel, must be somewhere in the region of 10,000 below establishment now. Without good and fair pension rates for our servicemen and women, it will become increasingly difficult to recruit the right sort of people for service life. I welcome the creation of a veterans' unit, which I hope will be used to get rid of pension anomalies.

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  I wish to focus your Lordships' attention on the profoundly unfair phenomenon known as the "pension trough", which impacts on our ex-servicemen first and then even more severely on service widows. This so-called "pension trough" comes about when pay increases are staged, with half the pay increase allowed in the first six months of the financial year, and the remainder in the second half. To explain this a little further, because pensions are based on pay rates those retiring in the first six months within the same financial year leave with a lower pension than those who retire in the second half. That is totally unacceptable and should be corrected immediately.
  An underlying principle of the military salary and of the Armed Forces pension scheme is a concept which is known as "the band of brothers" or "all of one company". Under this concept, all servicemen and women of the same rank, who have given the same reckonable service and who retire in the same financial year, should receive the same basic award of service pension. I think that your Lordships will consider it fair and proper that the military community should have constructed its pension regime on such a reasonable and equitable basis.
  But that inherently fair system can go very seriously wrong and operate most unfairly under external influences. The noble Lord gave your Lordships a general example in his opening speech. Perhaps I may cite a specific case. Commander Keith Monnery, after 30 years' service in the Royal Navy, deferred his retirement at the request of his superiors to suit the needs of the Polaris submarine programme. He actually retired in August 1977—in a "pension trough". Had he retired two years earlier, as originally planned, his pension would now be some £5,000 greater than it is. Had he retired one year earlier or later, his pension would still be some £2,000 a year greater than it is. That is profoundly unfair and it is not a befitting way for the nation to look after its ex-servicemen.
  Some might feel that the example quoted is from history, but perhaps I may describe the present situation.
  First, I must remind your Lordships that since 1971 the independent review body on Armed Forces pay has made annual recommendations on the remuneration package for service personnel. In particular, the review body makes recommendations to the Prime Minister on pay. In view of what has been said earlier about the lack of representation in the Armed Forces—in terms of a trade union or staff federation—your Lordships will recognise the importance of the role of the independent Armed Forces Pay Review Body in protecting the interests of the Armed Forces. I specifically draw attention to the independence of the body, a status which is crucial to its credibility.
  As I have said, the Armed Forces Pay Review Body makes recommendations every year about pay. Importantly, under the terms of the Armed Forces pension scheme, the pay rates in force on the day of retirement determine service pension rates. So, the review body's recommendations on annual pay have a direct bearing also on the pensions of those who complete their military careers in that year.
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  It is a fact that in four of the past five years the Government have staged the introduction of the Armed Forces pay award, notwithstanding the fact that they have accepted in full the recommendations of the review body. That short-term expedient, as the Government well know, means that the pensions of those who are unfortunate enough to retire in the interim are permanently depressed.
  Earlier this year the chairman of the Armed Forces Pay Review Body wrote in his 1998 annual report:
  "Our recommendations [for 1997] were accepted but for the second time in two years, and the third time in four, the implementation of the pay award was staged. We are seriously concerned that this practice has deprived our servicemen and women of a substantial proportion of their recommended annual salaries and is permanently damaging to the pensions of those who retire between stages. We urge that this is not repeated. This year our discussions with Service personnel revealed widespread anger at staging".
  In spite of that specific recommendation, and in total disregard of the longer-term implications for pensions, the Government again staged the 1998–99 pay award. Is it really the intention of the Government permanently to depress the pensions of service men and women who just happen to complete their service—which may have lasted 30 to 40 years—while a short-term pay restraint measure is in force? Moreover, the effect is aggravated by the passage of time and is then carried over into widows' pensions.
  By any yardstick this cannot be judged an honourable practice. If it is considered essential to stage the introduction of a forces pay award I urge the Government to adopt the practice of deeming of pay rates for pension calculation purposes. This would not create a precedent as that measure has been adopted on a number of occasions in the past, including arrangements for Members of another place in 1996. This is nothing but scandalous behaviour by Members of Parliament who have elected themselves deemed pension rights while denying them to members of the Armed Forces whose lives are at risk.
  Many of those deployed on operations face death daily. A precedent has been set for Members of Parliament. Let that now be applied to all members of the Armed Forces.
  I call upon the Government to reduce the disparity in the pensions paid to those who have suffered for a long time, not by large retrospective payments but by modest payments to correct their situation in future. I ask the noble Lord the Minister to explain why this cannot be done.
  1.41 p.m.
  The Earl of Effingham: My Lords, I too thank the noble Lord, Lord Morris of Manchester, for introducing this important Bill in your Lordships' House. I declare an interest. I work for the Royal British Legion. It is significant that its pensions department now handles over 90 per cent. of all claims that go to appeal tribunals of which there are some 10,000 annually.
  I should like to address two particular areas: the entitlement of reservists and medical conditions. Many reservists and TA personnel (over 600 people) who were

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  deployed in the Persian Gulf for Operation Granby in 1991–92 are being denied access to the attributable benefits for reservists scheme (ABRS) on the basis that they were not medically discharged from Gulf War service. However, although approximately 420 of these people are in receipt of a war disability pension as the direct result of their Gulf War service these same servicemen and women were not informed that they could have asked for a medical discharge. They feel that they are being treated differently from regular soldiers and thereby discriminated against. This would appear to be in breach of the Ministry of Defence instructions that they would not suffer financially but would be treated exactly the same as regular soldiers in terms of pension entitlements.
  Territorial Army and Regular Reserve personnel who volunteered for Gulf War service were told by the Ministry of Defence that in the event that they should become a casualty they or their spouse would receive the same benefits as a member of the regular forces under the provisions of the ABRS. This advice was factually incorrect. Due to an anomaly in the regulations those who became ill and injured on embodied service, would not qualify.
  I turn to the question of medical conditions. Many former Far Eastern prisoners of war claim that the cycad seed which formed part of their near-starvation diet led to the development of neurological disorders in later life. This is supported by medical evidence related to the local population of the areas where this seed forms part of the dietary intake. The War Pensions Agency has investigated these claims but so far does not appear to have come to any conclusion. Those rejected claims that are now the subject of an appeal in some cases are being delayed pending a DSS policy decision in this matter. Some four years or more have passed since the submission of papers to the DSS and still no response.
  A similar situation applies in cases of stress and hypertension. An opinion was obtained from a leading cardiologist. That provided compelling evidence of a relationship between these two medical conditions and their application to service in the Armed Forces. Many war pension appeals are being adjourned and delayed while the War Pensions Agency considers its response. We understand that that is unlikely to be forthcoming until the end of this year. Considering that this option was submitted in September 1997 and that the majority of war pension appellants are of advanced age, this is not a satisfactory state of affairs. Presumably a consultative body with the necessary expertise and authority would be able to resolve such matters or at least provide strong recommendations in a considerably shorter space of time.
  In summary, the Gulf War and what happened to many of those who took part in it is still the subject of investigation and research. However, the conflict also highlighted anomalies in eligibility for compensation payments to reservists as opposed to members of the regular forces. There would appear to be no provision for reservist payments of invalidity benefits by the Ministry of Defence if they were not the subject of a medical discharge. Many reservists claim that they
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  developed conditions not post-service but while still serving and that, irrespective of whether that led to their medical discharge, they should be treated on an equal basis with members of the regular forces.
  Although the reservists can claim DSS war pensions, the regulations further discriminate against them by placing on them the burden of proof, even if a claim is made at any time after leaving the services. It is to be hoped that the Government's current review of service compensation will address these injustices and provide long needed reforms. It is also hoped that the review will provide an opportunity for consultation with the service organisations who are closely involved in such matters and that it will not suffer the same fate as its predecessor, the Bett Report, which now seems to have been consigned to history.
  As many noble Lords are aware, there are no independent appeal procedures which can be applied to Ministry of Defence decisions. A consultation body such as that proposed in the Bill will provide for arbitration in such cases and is welcome.
  1.48 p.m.
  Baroness Dean of Thornton-le-Fylde: My Lords, I am pleased to support the Bill introduced by my noble friend Lord Morris of Manchester, particularly in view of his marvellous record over the years in speaking out in this particular area. Only a small number of noble Lords are taking part in this debate but we come from all sides of the Chamber. This matter does not give rise to any political issue by any stretch of the imagination.
  I should like to concentrate on the issue of war widows. I do not do so because I believe that other parts of the Bill are unimportant. The last time this matter was discussed was during the passage of the Pensions Bill. It was a different day of the week and time of day but one could not sit down in the Chamber. The Benches on all sides of the House were full. I recall the remarkable speech of the noble Lord, Lord Freyberg. When we came to divide, the political disciplines were applied, but I do not believe that many noble Lords in this Chamber were convinced by the counter-arguments. Although time has moved on, the general principles that underlie the issue have not changed. Had we taken the right decision then, I do not believe that we would be discussing this matter in this way today.
  When the proposed change affecting war widows was discussed under the Pensions Bill in 1995 in another place, two reasons—I shall call them excuses, because that is what I believe they were—were given for not conceding the point of principle that when a woman, widowed as a result of the death of her husband in the service of his country, received a widow's pension, should she remarry, she lost her pension. That is the key issue upon which I should like to concentrate.
  There were two, as I say, excuses then given. The first was the perceived effect on civil servants in other areas of work. Although I do not have an interest to declare today, I was a member of the Armed Forces Pay Review Body. I find it difficult to make a direct comparison between asking personnel when they sign up to be prepared to give the ultimate—their lives and

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  therefore the future of their own families in many cases—and persons who are recruited into employment in other civilian jobs, and who are paid by the Crown, as are Service personnel. Nevertheless, that was put forward as a reason.
  From April this year, the LGA has done the right thing by widows when their husbands die in service. They receive a widow's occupational pension derived directly from their husband's occupational pension contributions.
  The other reasons given was that it would be entirely wrong. The Bett Report dismissed that, and rightly and not surprisingly so, because it was not a new principle, it was contained in the Goode Report, which was the key report which brought about the Pensions Bill itself.
  My experience in industry is that today occupational pension schemes, by and large, provide a widow's pension for life under the husband's occupational pension scheme. I do not accept that those are principles which should prevent this happening. If one wants to be mercenary and look at the cost factor, we are not talking about something that will increase the cost to the nation. But even the economic arguments do not stack up when one studies them.
  I happen to have a part-time public sector job. I pay 6 per cent. of my salary to the pension that I shall eventually receive. There is an abatement of 7 per cent. in the pay of Armed Forces personnel. So the abatement is an even higher figure. It is not as though the fund is a non-contributory one. It is a pension contributed to from the salary of those service personnel.
  The noble Lord, Lord Vivian, referred to the fact that the Armed Forces have no independent representation on their behalf other than the Armed Forces Pay Review Body. They do not have the right to join a trade union, and they do not have a federation. So who speaks for them? That is a key question. Although pensions are not directly in the remit of the Armed Forces Pay Review Body, whenever I met Service personnel—and I met a great many of them, whether it was on their ships in the Navy, on air force bases, or soldiers—they all raised with me the issue of pensions. They were all concerned about it. They had no idea what they could do to get their problems aired and their concerns aired about their widows if they lost their lives in the service of the nation. On those facts alone, the Bill is worthy of a good hearing.
  There is a third reason. There is something wrong with a system that encourages widows not to remarry, although they may enter into a relationship, because on remarriage they will lose their pensions. That is not a threat many other widows in Britain have to face. The widows of people in industry whom I used to represent would not have that to face. They do not regard their pension as a hand-down from the state or from the private sector employer: they paid to it. It was part of their overall employment package. That is what I interpret it to be in the case of the Armed Forces.
  We believe in families—this is not a party political issue—and support them; we believe in the family unit; and in Britain we believe in marriage. There is something wrong with a situation where a woman
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  knows that if she remarries she will be penalised financially. That is wrong. It is especially wrong if she marries someone who may not have sufficient income to care for the children of the marriage in the way that her previous husband was able to.
  I approach this issue on fairness and responsibility grounds. We have a responsibility to these people and their families. I have always judged good employers on how they judge people in the round, and not just on the level of their salary; how they regard them as employees. These people sign up knowing that they could give their lives in the service of their country. On those grounds, the Bill is worth a hearing. I shall listen with great care to what my noble friend the Minister says in response. I cannot think of any logical reasons for going against the Bill.
  1.56 p.m.
  Lord Freyberg: My Lords, I, too, congratulate the noble Lord, Lord Morris of Manchester, on bringing the Bill to the House and thank him for his kind words about me. In the other place he has a well-deserved reputation as an assiduous protector of many groups, including the Armed Forces. I know that from my own experience. When I started out here three years ago, speaking on several of these issues, 1 received tremendous support and kindness from him. It is wonderful to be taking part in his Bill which he has so ably moved. As he said, the welfare of our servicemen and women, and their dependants, is an important issue. Parliament has a special responsibility to them and it is not, as the noble Baroness, Lady Dean of Thornton-le-Fylde, said, a matter of party politics.
  The noble Lord highlighted some of the shortcomings in the current Armed Forces' pensions and benefits regimes. I would like to expand on the problems underlying two of the concerns to which the noble Lord referred.
  The Armed Forces Pension Scheme is 40 years old. It has been periodically modified, to match new social norms, changes in legislation and wider pension practice. So, for example, in 1973, when it became standard to pay a widow a pension based on half her deceased husband's pension instead of one-third, the rules of the Armed Forces Pension Scheme were updated. Thereafter, new entrants to the scheme enjoyed a half-rate pension for their widows and those serving at the time were given the opportunity to buy into a half-rate pension. The provisions from 1973 onwards are seen as fair and proper.
  Unfortunately this is not the case for those whose plight prompted the change in the rules in the first place. Those who completed their service before 1973 never had the opportunity to buy into a higher rate scheme and their widows' entitlement remained at one-third. This affects the most elderly widows, who in addition receive far smaller pensions than those who served subsequently, and who current struggle to survive. This is absurd and unfair.
  In a similar way, in 1978 the rules of the Armed Forces Pension Scheme were changed to allow a widow of a post-retirement marriage to receive a pension based

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  on any service her late husband gave after 1978. Those who had already completed their military careers when the new rules came in were unable to hand on any pension to wives married after they had retired, whatever their length of service. It should be stressed that this situation is particularly acute in the Armed Forces because of compulsory early retirement ages, which did not (and do not) apply to the same degree to members of the Civil Service, the police force or the fire brigade, or other public services.
  So, I challenge the logic and propriety of identifying inequities and anomalies in the Armed Forces pensions and benefits regime without offering remedy to those affected. Changes made to the provisions for widows have been essential and welcome, but the lack of new arrangements for the very people who are suffering is iniquitous.
  Let me give you two examples to illustrate the unfairness of the prevailing regime. Mrs. Jean Dewdney's late husband served in the infantry for 34 years. This included service throughout the Second World War, and in Korea, where he was appointed MBE. He retired in 1962 and his widow has had to manage on a one-third rate pension since her husband's death in 1987 because he retired before 1973. She is now nearly 73 years old and receives a pension from his army service of £3,634—a measly sum to live on.
  Mrs. Anne Sweetapple is in an even worse situation: she receives no service pension. Mrs. Sweetapple married her late RAF husband a little over one year after he had completed nearly 37 years' service. They were married for 28 years and she nursed him for several years before he died two years ago. She receives no service widows' pension because he completed his service before 1978.
  I find the cases like this very disturbing. It just doesn't seem right that women like Mrs. Dewdney and Mrs. Sweetapple should be left so inadequately provided for. Urgent action is required. Such women are increasingly old and vulnerable, and fearful of the future—often unable to pay for basic needs.
  Their pension provisions are grossly inadequate, as subsequent changes in the law recognise. Their needs will not go away. The inequity between the two will continue to cause great distress. It should be addressed as soon as possible.
  The argument against retrospection is understandable, but, as the noble Lord, Lord Morris, has pointed out, the circumstances of the Armed Forces have always been acknowledged as special. Moreover, arguments against retrospection are no reason for leaving vulnerable people in poverty while providing for others. They must feel as if their plight is being deliberately ignored in the knowledge that the passage of time will simply remove the problem.
  I understand that the MoD is again reviewing the Armed Forces Pension Scheme for future entrants to the forces. The House would like to be assured that the review will not only identify the shortcomings of existing provisions but consider measures to help those already suffering under them.
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  It is morally unacceptable to identify and acknowledge serious shortcomings and to then allow them to persist. To this end, I hope that the Minister will ask the MoD review team to consult former service organisations in order to determine the views of service pensioners.
  Finally, I call upon the Government to grasp this late opportunity to ensure that the widows of servicemen who have served our nation are able to live out the last years of their lives with dignity and some financial security.
  2.3 p.m.
  Lord Randall of St. Budeaux: My Lords, I beg the indulgence of the House in speaking in the gap. I shall confine my comments to three or four sentences. I am pleased to associate myself with this Second Reading debate and the Bill. I admire the way that the noble Lord, Lord Morris, seems to have spent most of his life caring for people. He was Minister for the disabled and served terrifically well as chairman of the parliamentary pension scheme for almost 20 years. Now he is taking steps in respect of service pensions, war pensions and war widows' pensions. The essence of the Bill is worthy and I hope that it will be supported at all stages as it proceeds through both Houses.
  Clause 1 relates to the production of an annual report. The idea is eminently sensible. It would have the effect of ensuring that the Government are fully aware of the concerns and what is happening in this important field with regard to our servicemen.
  We have heard that there is a feeling of unfairness at the way ex-servicemen and women and widows are being treated. I shall not go into details. If the report does anything to overcome that feeling of unfairness, then the whole matter is justified. If there is unfairness, then published reports to ensure that there is accountability are worthy things.
  Producing such a report would institutionalise the concern of the Government for people who have served our country in such an admirable way—people who have given their lives, people who have suffered. Many of our fellow Peers walk with difficulty because of what happened during the war when they were shot at and experienced bombs and other horrible things.
  The report, which is the essence of the Bill, is worthwhile. It is laudable. I hope very much that the Bill receives support at all stages in both Houses and goes through on the nod. It is not complicated; the principle is simple. I am pleased to support the noble Lord, Lord Morris of Manchester, in his enterprise.
  2.6 p.m.
  Lord Goodhart: My Lords, we are most grateful to the noble Lord, Lord Morris of Manchester, for introducing this Bill today. As all noble Lords are aware, his record of service not only to the war disabled but to all disabled people is outstanding and unique in this country today.

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  Those who have been disabled through military service, or whose husbands have been killed in war service or died as a result of that service, are especially deserving of the gratitude of this country. Some pensioners were disabled, or lost their husbands, in the cause of defending this country from the desperate threat of World War II—a war in which the grandfather of the noble Lord, Lord Freyberg, played such a distinguished part. The loss and hardship of others are no less real and deserving if they were suffered as a result of resistance to aggression and violence, even if that aggression posed a less direct threat to the United Kingdom. One thinks of the wars in Korea—in which a number of my National Service contemporaries were killed or disabled—the Falklands, the Gulf War and, more recently, Bosnia; or if the disability or death was caused in the process of peacekeeping operations in Northern Ireland. Fortunately, the number of new pensioners remains small. However, even now there is the possibility of further deaths or grave injuries in Northern Ireland; and there is a possibility of further involvement in places such as Kosovo.
  The services, war pensioners and war widows are a group who have always been supported by this House. It was as a result of pressure from this House in a debate on the Pensions Bill, subsequently the Pensions Act 1995, and in particular pressure from the noble Lord, Lord Freyberg, that Section 168 of that Act was incorporated. It restored widows' pensions to those who had remarried but whose second marriage had terminated through death or divorce.
  The noble Lord, Lord Morris, and the noble Baroness, Lady Dean of Thornton-le-Fylde, both spoke movingly in support of the proposition that widows should retain their pensions following their remarriage. I hope that the Government will listen to those arguments. It is a total anachronism nowadays that any woman's pension should be lost by her remarriage.
  I also hope that the Government will support proposals made by the noble Lord, Lord Morris, for age additions for the older service and war pensioners and war widows. I hope that the Government will deal with the anomaly raised by the noble Lord, Lord Vivian. It is an anomaly caused by staged pay awards and is clearly unjust.
  The Bill is directed to preventing unnecessary hardship to recipients of service pensions, war pensions, and war widows' pensions. The hardship of service pensioners, war pensioners and war widows is part of a wider context. It should be the aim of this or any government to ensure that all pensioners receive pensions which are adequate to provide a decent standard of living in retirement. How that is to be done is a matter for debate. It is a debate currently taking place within the Government and will soon become a matter for wider debate. It is not the occasion for that wider debate today.
  We on these Benches warmly welcome the initiative of the noble Lord, Lord Morris of Manchester. We support the Second Reading of the Bill and ask the Government to treat this now small and especially deserving group, whose numbers are declining, as generously as possible.
  2.11 p.m.
  Baroness Byford: My Lords, I welcome the opportunity to respond on behalf of the Conservative Benches. I thank the noble Lord, Lord Morris, for bringing the Bill forward. We have a tremendous commitment to, and give thanks for, all those who have served this country in the past, and continue to do so. They are exceptional people who always put country before their own individual personal gain.
  We welcome the Second Reading of this Bill which requires an annual report to be made on service pensions, war pensions and war widows' pensions. It will lead to greater and open awareness of what goes on. I was not in the House when the previous Bill was passed. I have sat humbly among your Lordships and was touched by the contributions made by noble Lords with great expertise from all sides of the Chamber. In this House we have an age range which represents those with experience of more recent times and those with great knowledge of earlier times. Before moving on to specifics, I pay great tribute in particular to the British Legion but also to the other myriad of organisations which help our service people.
  I put on record our tribute to all those who served in our forces. They have given great commitment. Many of us in this Chamber today know only too well their record of service in the past. I am sure it is right that we, in our turn, should make sure that their pension provision is properly met.
  The noble Lord, Lord Morris, asks quite simply that an annual report be placed before Parliament and that it shall include the number of pensions and an assessment of payment levels to make sure that those pensions are sufficient to prevent hardship. Listening to the debate today I was deeply moved by the many examples which were brought forward by noble Lords. My noble friend Lord Vivian touched on the problem of pension troughs and delay. I was not aware of that. He mentioned also that the pay awards are staggered. I hope that the Minister will respond to that in replying to the debate.
  The noble Earl, Lord Effingham, referred in particular to pension entitlements and the fact that benefits should be relevant to the people concerned. He also raised the problem of medical conditions which ex-service people must overcome. At present, there is no right of independent appeal which, again, the Minister may wish to address.
  The noble Baroness, Lady Dean, spoke of war widows of whom I have met many over the years. I too find it difficult to understand why their pensions are removed after remarriage.
  The noble Lord, Lord Freyberg, spoke of pensions and the pre-pension position of the ageing and older pensioners. The number of those is obviously dwindling and I hope that the Government may feel able to do something more practical for them.

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  The noble Lord, Lord Randall, and others raised the unfairness of the system. That theme has been present throughout our debate. However hard one tries, anomalies tend to arise.
  If we give the Bill a Second Reading, the report provided in it will make it possible for Parliament to be able to see how well the agency is working, and to ensure that checks and balances are made. We shall be able to call into account the way in which pensions are provided. It is proper that those who serve our country should be looked after properly.
  I believe that the noble Baroness, Lady Dean, spoke of the serious consideration that she hoped we should give this matter today. I am sure we all agree. The review should encompass many of the concerns and questions which have been raised today. I wish and hope that this Bill will be accepted by the House and that many of the points which have been dealt with in great depth by noble Lords with much experience will be taken on board by the Government. We are all grateful to those who have served. In our turn, we all wish to make sure that we look after them after they have looked after us.
  2.17 p.m.
  Lord Haskel: My Lords, I thank my noble friend Lord Morris for giving us this opportunity to speak about pensions and compensation available in respect of injury, illness and bereavement attributable to service in the country's Armed Forces. I add my tribute to all those who have been disabled or bereaved as a result of service to this country in the Armed Forces. The Government fully recognise the debt of gratitude owed to all those who made such sacrifices.
  I pay tribute also to the ex-service organisations which act in the interests of ex-servicemen and women and their dependants. I have great admiration for the valuable work they do and thank all noble Lords who have spoken today on their behalf. Also, I acknowledge the dedication of my noble friend Lord Morris to matters relating to disabled people. I pay tribute to his distinguished service to war pensioners, disabled people and victims in general.
  My noble friend's Bill brings before us today the matter of war pensions, war widows' pensions and service pensions. They are not all dealt with by the same department. War pensions and war widows' pensions are the responsibility of the Department of Social Security while service pensions are the responsibility of the Ministry of Defence. Nevertheless, I shall do my best to address all aspects of the Bill. The legislation contains two main provisions. The first is a request for information about war pensions and Armed Forces pensions. The second is a requirement for a regular assessment of whether pension levels are set sufficiently high to avoid hardship.
  I shall start with a matter of information. There is already a statutory provision for a report on war pensions to be presented to Parliament each year. This report, the War Pensioners' Report, details the current number of war pensions' recipients and also gives
  1552
  information on the various issues affecting war pensioners considered by the statutory central advisory committee on war pensions. The committee meets twice a year with the Minister who has special responsibility for war pensions. It is an independent body; it is not a voice of government, as noble Lords seemed to imply. Committee members represent all major ex-service organisations such as the Royal British Legion, the British Limbless Ex-Servicemen's Association, and the War Widows' Association of Great Britain. Indeed, I have with me the War Pensioners' Report for 1977. On page 22 of the document there is a picture of a young MP who has a lovely wave in his hair. The caption below the picture says:
  "Mr Alfred Morris MP, Minister with special responsibility for war pensions, during his visit to the Princess Louise Hospital, Erskine near Glasgow"
  That report has been in existence for a number of years, and I believe that noble Lords are well aware of it.
  A further statutory annual report is presented to Parliament by the chief executive of the War Pensions Agency. This report, the War Pensions Agency Annual Report and Accounts, details how the war pensions scheme is administered and includes details of performance targets and achievements. I believe that that deals with the point raised by my noble friend Lord Randall about the necessity for openness to overcome unfairness.
  At present the Ministry of Defence does not present routinely an annual statement on service pensions paid under the Armed Forces pension scheme. But each year detailed information about the level of armed forces pensions, including ill-health benefits and attributable injury benefits, is published in Orders in Council for the Royal Navy; in the Army Pensions Warrant; and in the Queen's Regulations for the RAF. These documents fully describe the rules of entitlement for pensions benefits under the scheme and record the levels at which pensions are set. Thanks to the introduction of resource accounting, I am pleased to say that, from 1999, this information will be supplemented by an annual statement of accounts to be laid before Parliament. The point I wish to make is that I believe that, taken together, all this information is more than adequate to meet the requirements of my noble friend's Bill for information about pension levels.
  Perhaps I may now turn to the matter of adequacy as regards my noble friend's Bill. I shall take, first, service pensions. The noble Lord, Lord Freyberg, reminded us that the foundations of the Armed Forces pension scheme were laid in 1959–60. As he said, a number of improvements have been made since that time. It is a non-contributory, salary related occupational scheme. The retirement age for Armed Forces personnel is 55, by which time most individuals have earned a full career pension. Immediate pensions are payable on retirement at younger ages after periods of service as short as 16 years for an officer, or 22 years for a serviceman or woman of other rank. Pensions are increased annually in line with the rate of inflation so that they maintain their purchasing power.

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  The scheme contains a range of ill health and injury benefits. Those retiring on ill health grounds can receive a pension after two years' service, and after five years' service the pension benefits are enhanced compared with normal pensions. Those becoming ill or injured as a result of their work may be paid additional benefits, known as attributable benefits, depending on their degree of disability. The pensions of individuals who are retired for attributable reasons are tax free.
  The Government Actuary periodically assesses the value of the Armed Forces Pension Scheme. His most recent evaluation confirms that its benefits remain greater than the generality of occupational pension schemes. Nonetheless the scheme is kept under review and it continues to evolve and change in line with current legislation and policy. On 8th December, the Government announced a review of the current arrangements to compensate ex-service personnel for injury, illness or death. The review was commissioned because the Government shared a number of concerns—many of which were stated in this debate today—about the anomalies and complex nature of the existing arrangements.
  I can confirm that the review is looking at all the compensation schemes available—the noble Lord, Lord Freyberg, asked about that—including the war pensions scheme, and the inter-relationship between them. The aim is to devise a modern, fair and simplified scheme which would apply to all service personnel killed or disabled as a result of their service. The main focus is on people who will join the forces in the future but the review will also consider existing apparent anomalies. We will publish the outcome of the review in a consultation document. Consultation will involve all those with an interest in the area, including the ex-service organisations.
  Turning to the levels of war pensions, this Government have fully protected the purchasing power of war pensions, by uprating them in April this year in line with the retail prices index. As regards the adequacy of the rates of war pensions, let me compare those we provide for our war pensioners with those we provide to civilians in respect of disability or bereavement. For example, a severely disabled ex-serviceman or woman could receive currently a total tax free war pension of over £400 a week. The equivalent payment under the Social Security Industrial Injuries Scheme would be £344.
  A former private who has served five years in the Army, and who is invalided as the result of a severe training injury and whose disablement is assessed as 100 per cent. could receive a tax free attributable pension from the Ministry of Defence of just over £4,000 a year. With the maximum war pension, that would give him a total annual income of some £24,000, all tax free. That is not the sort of income that could be considered to put a man or woman in hardship.
  I should explain at this point that financial recognition in respect of disablement or death arising from service in the Armed Forces can come from more than one source. A disabled ex-serviceman can be paid a war disablement pension from the Department of Social
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  Security and can also receive an attributable service pension from the Ministry of Defence Armed Forces Pension Scheme. The same principles apply regarding war widows' pensions. Under the war pensions scheme, a war widow's pension may be awarded where the late husband dies as a result of service.
  The majority of war widows receive currently a total weekly pension of £157. That amount comprises the standard rate of war widow's pension of £83.90 a week, an age allowance, and a supplementary pension of £54.70.
  Again, to put the total pension into perspective, I should explain that the standard National Insurance widow's pension is £64.70 a week, around 25 per cent. lower than the standard war widow's pension, and less than half the full war widow's pension payable to a widow aged 70 or over.
  So, taking an overall view of war pensions income compared with that for the whole population of this country, noble Lords may find it helpful to know that figures based on the 1995–96 Family Resources Survey indicate that war pensioners' weekly incomes were within a few pounds of the average income of the whole population—£287. That average includes groups in full-time work. That perhaps demonstrates the adequacy of some of the pensions.
  Noble Lords raised matters of concern. My noble friend Lord Morris raised the case of Mrs. Koe and Mrs. Osland. I cannot discuss any individual case now, but I will write to my noble friend. The noble Lord, Lord Freyberg, raised the case of Mrs. Dewdney and Mrs. Sweetapple. Again, I will write to the noble Lord, as I cannot deal with individual cases.
  Concern was raised about the matter of war widows remarrying. My noble friend Lady Dean spoke eloquently about the issue and it was mentioned by other noble Lords. Cessation of widows' pensions on remarriage with discretion to restore on second widowhood is a feature of most public service schemes. It is not an issue that can be looked at in isolation from the rest of the public service.
  The principle of spouses' pensions for life has been conceded for local government employees on the basis that local government pension schemes are funded schemes, and that the cost of the improvements will have to be found from within the authorities' pension funds. There are no direct public expenditure implications. The current review of compensation arrangements for death or injury to service personnel will, however, provide an opportunity to re-examine the arguments. We shall certainly take into account what has been said in the debate today.
  The noble Lord, Lord Freyberg, raised the question of pre-1973 widows. A supplementary war widows pension may be awarded to pre-1973 war widows; that is, to the widow whose husband's death was due to service before 31st March 1973.

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  That supplementary pension was introduced in 1990 in order to bring overall pension provision for pre-1973 widows more into line with that for the widow whose late husband's death was due to service on or after 31st March 1973 and who received an attributable pension under the Armed Forces pension scheme administered by the Ministry of Defence. Therefore, we have tried to deal with the question of pre-1973 widows.
  My noble friend Lord Morris raised the question of deterioration through age and the additional problems faced by war pensioners. Age allowances are payable to war pensioners aged at least 65 whose disablement is assessed at 40 per cent. or more. A war pensioner may apply at any time for a review of his case if he considers that his condition has deteriorated.
  My noble friend also referred to the issue raised by the British Limbless Ex-Servicemen's Association in relation to age allowances for war disabled. I have to explain that these allowances are unique to the war pensions scheme and were introduced to ease the double burden of age and relatively severe disablement. The allowances currently range from £7.40 a week for those aged 65 or over whose war pensions disablement is assessed at 40 to 50 per cent., to £22.90 for those whose disablement is assessed at over 90 per cent. I understand the noble Lord's proposal, but those are not insignificant amounts. In isolation, it would be difficult to justify an increase in that war pensions preference. I will, however, ensure that the noble Lord's proposals are kept in mind.
  The noble and gallant Lord, Lord Vivian, raised the question of the pensions trough and staging, and gave us an example. Certainly this can lead to anomalies whereby those who are about to retire can receive lower pensions than those already in retirement. This is because pensions are based on pay. Once in payment, pensions rise in line with the retail prices index. This matter affects all public service pension schemes. It is confusing. We cannot treat Armed Forces pensioners in isolation. We note the noble Lord's suggestion on deeming pay rates through pensions. I am sure that that suggestion will be considered by the Committee which is reviewing these matters. I can assure the noble Lord that we have no intention to depress pay through staging, but we have to keep within public expenditure limits.
  The noble Earl, Lord Effingham, raised the question of reservists in the Gulf. The Ministry of Defence has received a number of representations from Gulf veterans about their entitlement to invalidity benefits under the provisions of the Armed Forces Pension Scheme. Claimants have questioned the status of members of the reserve forces for the purpose of determining eligibility under the rules, the circumstances and regularity of their discharges and the attributability of particular conditions to service. The Ministry of Defence is currently investigating these claims.
  The noble Earl, Lord Effingham, also raised the question of Far East dietary deficiencies. This matter is under consideration and we expect to be able to provide
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  an answer during the course of this year. We appreciate the seriousness of the matter, but I understand that there are, in fact, very few cases.
  I believe I have responded to most of the points raised by noble Lords. Perhaps I may say in conclusion that the Government will not oppose my noble friend's Bill, but we feel that we are already delivering much of what the Bill asks for. A statutory annual report on war pensions is provided to Parliament each year. Together with the proposed annual statements of the Armed Forces Pensions Scheme, that should provide all the information which my noble friend requires. We have a Service pension scheme which provides benefits greater than do the generality of other schemes and war pensions which are payable at a higher rate than their social security equivalents, roughly equal to the average income of the population. I believe that that should go some way towards satisfying my noble friend's concern about the level of pensions.
  Finally, it appears to me that war pensioners and Ministry of Defence pensioners have a secret weapon. That weapon is noble Lords who are in this Chamber today. They will certainly keep the department on its toes. In the debate today they have demonstrated their deep concern about this matter. I hope that the Government will be able to respond to that concern.
  Earl Russell: My Lords, before the noble Lord sits down, perhaps I may ask him one question. I hasten to reassure him that I do not seek an immediate answer. My question relates to the treatment of noise-induced hearing loss in war pensioners. Can the noble Lord explain why the Government's treatment of this matter is so different from that of the Government of the Republic of Ireland? Perhaps he will remember, in drafting the explanation, that the Government of the Republic have relied on the advice of the same medical experts who have advised the British Government.
  Lord Haskel: My Lords, I am not aware of the advice given to the Government of the Republic of Ireland. The Government have kept their pledge to review the scientific basis for the department's approach to the assessment of noise-induced sensorial hearing loss in war pensioners. My noble friend Lady Hollis has accepted the review team's recommendation that the matter should be reviewed in one year's time and has asked the war pensions medical policy adviser to report to her on any further relevant scientific developments in February 1999.
  2.40 p.m.
  Lord Morris of Manchester: My Lords, I am most grateful to those in all parts of your Lordships' House who have spoken on the Bill for all their kindness to me personally and for the support they have given to the Bill's provisions. My noble friend Lord Haskel promised to have urgently reviewed all of the individual cases raised with him. Quite clearly there were cases of personal hardship and I hope we shall hear very soon that they have been justly resolved.

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  In reply to the only reservation I have heard about its provisions, I have to say that the Bill's purposes are not by any means met by present arrangements. Let me quote just two of the Bill's requirements. The first is that the annual report shall include,
  "an assessment of whether the payments made during the year in respect of those pensions [that is, service, war and war widows' pensions] have been sufficient to prevent their recipients suffering any unnecessary hardship".
  That requirement is not met now. We heard today of several cases of extreme hardship. While the Minister will respond in writing to the noble Lords who gave your Lordships' House details of cases of unnecessary hardship, it would help Parliament and the service and ex-service communities far more if there was a report, annually, on such cases from the Government. Secondly, the report sought by this Bill would have to say,
  "what plans, if any, [the Secretary of State] has to improve the well-being of those recipients [of service, war and war widows' pensions], whether by means of changes to the level of payments made in respect of those pensions or otherwise".
  That requirement is not, to my knowledge, met by any document now available to your Lordships' House. The requirements I am seeking are urgent, not just in my view, but also in the view of the recipients of service, war and war widows' pensions.
  The Royal British Legion, the Officers' Pension Society, BLESMA, among many other organisations to which frequent reference has been made today, have the admiration of all of us. They want to see this Bill enacted. If there is any attempt to block the Bill in this Session it will not disappear. They will carry on, as they did in relation to other important improvements that have been secured, for as long as it takes to succeed.
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  I am satisfied that, given a wink and a nod from Ministers, the Bill would be enacted very quickly indeed, for there is also enormous support for the Bill in another place. Thus again, and with confidence, I ask this House to give this Bill a Second Reading.
  On Question, Bill read a second time and committed to a Committee of the Whole House.

  Sexual Orientation Discrimination Bill [H.L.]
  2.44 p.m.
  Baroness Turner of Camden: My Lords, I understand that no amendments have been set down to this Bill and that no noble Lord has indicated a wish to move a manuscript amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the order of commitment be discharged.
  Moved, That the order of commitment be discharged.—(Baroness Turner of Camden.)
  On Question, Motion agreed to.

  Criminal Appeal (Amendment) Bill [H.L.]
  Lord Ackner: My Lords, I beg to introduce a Bill to add to the verdicts or findings which may be subject to a reference to the court by the Criminal Cases Review Commission. I beg to move that this Bill be now read a first time.
  Moved, That the Bill be now read a first time.—(Lord Ackner.)
  On Question, Bill read a first time, and to be printed.
  House adjourned at a quarter before three o'clock.