Lords Sitting of 15 June 1998

Preamble
The House met at half-past two of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Southwell.

Schools: Truancy and Exclusion
Lord Quirk Lord Quirk asked Her Majesty's Government:
To what extent the measures to reduce truancy and exclusion from school (Cm. 3957, May 1998) will depend upon changing the content of what is taught.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, the Government acknowledge that many factors contribute to pupil disaffection. As part of our general review of the national curriculum, the Qualifications and Curriculum Authority will be focusing on a number of themes to ensure that it better meets the needs of disaffected pupils. We have announced our intention to take early action to promote work-related learning for 14 to 16 year-olds to re-engage disaffected young people. The authority has consulted on criteria which would enable schools to adopt innovative approaches to increasing the focus on work-related learning. The Government are currently considering the authority's advice on the outcome of the consultation.
Lord Quirk: My Lords, I am grateful to the Minister for that response, and for her references to the way in which the new curriculum will be making allowances for, as she puts it, disaffected pupils. Given that teachers cannot teach to more than one curriculum at a time, and given that this document, in a dozen places, makes reference to making special appeal to disaffected pupils, could we be given some assurance that the sweeteners designed to woo the disaffected pupils will not result in a reduction in rigour in classes for pupils, the majority of whom, I believe, really want to learn?
Baroness Blackstone: My Lords, I entirely accept what I think lies behind the noble Lord's Question. One accepts the case for some flexibility in relation to the national curriculum, but it is extremely important that we do not undermine standards for the majority, particularly in key areas such as literacy and numeracy. It is important that rigour is at the centre of all that we are doing in relation to pupils, whether in primary or secondary schools. The move towards some work-related learning relates to Key Stage 4—to 14 to 16 year-olds in our secondary schools.
Lord Tope: My Lords, I welcome the Minister's Answer, but is she aware that many schools which are already adopting the innovative approaches described—for instance, through GNVQ foundation work at Key Stage 4—feel that they are penalised in that they have a lower place in the rather competitive school league
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tables? Does she agree that other schools are reluctant to adopt such an innovative approach for exactly the same reason; namely, they fear that they will lose their standing in school league tables? How do the Government propose to address that problem?
Baroness Blackstone: My Lords, I entirely accept that the place of GNVQs, whether at foundation, intermediate or advanced level, is incredibly important in the secondary school curriculum. It is a qualifications route that is much more appropriate for many young people than the academic route. It is therefore important that those schools that are successful in keeping young people at school, and in keeping them motivated and involved in the curriculum, should in no way be penalised. The Government are examining ways in which league tables can take into account success in GNVQs at various levels.
Baroness Blatch: My Lords, does the noble Baroness agree that music is a particularly effective subject, not merely as a complementary subject in the teaching of young people, but especially for those children who have difficulty in learning and for those who may be disaffected? It is a very good subject indeed. The educational spin-offs are enormous. It has been disapplied in the national curriculum. Therefore it is a matter of chance as to whether schools teach music; there is no requirement for them to do so. Is that not a retrograde step in relation to the attempt to raise standards in our schools?
Baroness Blackstone: No, my Lords, I do not believe it is a retrograde step. The reason for disapplying some parts of the primary school curriculum was to ensure that primary school teachers could reach the very ambitious targets that we have set for literacy and numeracy. The Government's view is that children at any age will not succeed unless they reach those targets. I refer to learning to read and write and to all the requirements of basic numeracy. The Government have asked the QCA to issue guidance on how to ensure that there is a broad and balanced curriculum in our primary schools. Music will play a central part in that.
Lord Taylor of Blackburn: My Lords, does my noble friend agree that much of this problem is created as a result of not diagnosing dyslexia in children in the early days? Does she accept that, if they are diagnosed, many of the problems will go away?
Baroness Blackstone: My Lords, disaffection, truancy and failure to be motivated by the national curriculum are complex areas. There are many possible causes of children being turned off by the schooling they receive. I entirely accept that, as my noble friend said, where dyslexia is a factor it is important to try to diagnose it as early as possible and then take remedial action to support children who suffer from it.
Lord Annan: My Lords, does the noble Baroness agree that part of the clue to the problem lies in the teacher training colleges and institutes, which ought to teach the tricks of the trade of teaching—namely, the way in which one can make even irregular verbs and valencies fun to learn by using various tricks?
Further, does the noble Baroness agree that the place in to which we ought to put our major effort is nursery education for children between the ages of three and five? Physiologists tell us that the human brain learns more in the early stages of life than in the whole of the rest of life. The human brain is particularly receptive to learning at that time. Very interesting studies of that kind, with which I shall not bore the noble Baroness, have been made in America proving the point. Could the Minister encourage the growth of nursery education, ensuring that children receive the opportunity to learn? If they do not learn then, the difficulty is that they may never learn.
Baroness Blackstone: Yes, my Lords. For the reasons the noble Lord, Lord Annan, stated so eloquently, the Government are committed to providing a nursery place for all four year-old children. They intend in the longer term to provide a nursery place for three year-olds as well. The noble Lord is right that this is the stage at which children learn fastest.
On the noble Lord's second question, it is vitally important that teacher education is such that it allows students to receive good teaching practice where they learn the "tricks of the trade", as he put it.

Parliamentary Contributory Pension Fund
2.44 p.m.
Lord Randall of St. Budeaux Lord Randall of St. Budeaux asked Her Majesty's Government:
When they expect the managing trustees of the Parliamentary Contributory Pension Fund to include a trustee from among the pensioners of the fund.
Lord McIntosh of Haringey: My Lords, the current regulations governing the managing trustees of the Parliamentary Contributory Pension Fund, under the Parliamentary and other Pensions Act 1987, preclude the appointment of a pensioner by stipulating that no person shall be appointed a trustee unless a sitting Member in another place. The chairman of the managing trustees has just written to the Leader of the House of Commons pressing for the regulations to be amended to enable pensioner members to be appointed trustees. The proposal is now under consideration and I will ensure that the House is kept informed of progress.
Lord Randall of St. Budeaux: My Lords, I thank my noble friend for that Answer. However, is he aware that pensions legislation introduced since the Maxwell pension scandal has advocated that a third of trustees should be elected by the membership of the scheme? Is he
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also aware that a huge majority, over 50 per cent. of the membership of the parliamentary scheme, which was chaired by my noble friend Lord Morris of Manchester for about 18 years, comprises pensioners? Does the Minister agree with me that, in terms of equity and plain common sense, there should be at least one representative on the trustee panel of the parliamentary pension scheme?
Lord McIntosh of Haringey: My Lords, my noble friend is right to say that the Pensions Act 1995 provided that one third of trustees should be from the members of the fund. But since 1972 the Parliamentary Contributory Pension Fund has had all its managing trustees as Members of the House of Commons. Therefore, it anticipated and went beyond the provisions of the 1995 Act. My noble friend is also right that the pensions review body under Professor Roy Goode recommended that there should be pensioner members of the trustees. That recommendation from Mr. John MacGregor, the present chairman of the trustees, is being considered by the Leader of the House of Commons.
Lord Morris of Manchester: My Lords, I am grateful to my noble friend Lord Randall for so kindly referring to my service to the fund over the years. While it is not for the Government alone to decide the question, does the Minister agree that the problems of many of the fund's pensioner members multiply in their retirement years and that some representation for them among the trustees would be in the best interests of the fund as a whole, not least of present MPs who are its pensioners of the future?
Lord McIntosh of Haringey: My Lords, my noble friend's long service to the fund has been well commented on by my noble friend Lord Randall. My noble friend Lord Morris is right that current thinking is that pensioners should be represented and the recommendation of Professor Goode is being considered by the President of the Council. I cannot say what the Government's attitude will be, but I should say to my noble friend that any change in the constitution of the pension fund must be ratified through the negative resolution procedure of both Houses.
Lord Higgins: My Lords, I must declare an interest as chairman of a company pension fund group of trustees and also as a member of the parliamentary scheme. I endorse what has been said about the splendid work done over many years by the noble Lord, Lord Morris. The implications of the Question seem to be that trustees who are pensioners would somehow represent pensioners' interests. Does the Minister agree that it is important that all trustees should, when appointed, represent all interests involved? Having said that, I express the hope that the base on which the parliamentary scheme exists would benefit from being widened in the way suggested.
Lord McIntosh of Haringey: My Lords, I have a great deal of sympathy for what the noble Lord says. As one who set up and ran a pension fund for 30 years outside politics, I agree that there should be pensioner

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representatives but that all the trustees should represent all the interests of all the pensioners rather than any specific interest.
Lord Campbell of Alloway: My Lords, how does one become a managing trustee? Is the trustee appointed? If so, who appoints him? How is it all done?
Lord McIntosh of Haringey: My Lords, in this case the managing trustees are appointed by the House of Commons as a whole. If the pension fund were to apply to this House, I presume that the position would be hereditary.

North Lanarkshire and East Ayrshire Councils
2.50 p.m.
Lord Rowallan Lord Rowallan asked Her Majesty's Government:
Whether they intend to make funds available to North Lanarkshire and East Ayrshire councils to avoid a deterioration in services as a result of their past financial management.
The Parliamentary Under-Secretary of State, Scottish Office (Lord Sewel): My Lords, the Government will not tolerate failure and inefficiency in council services, including direct labour organisations. My right honourable friend has already taken action in East Ayrshire and North Lanarkshire. The Government expect the councils concerned to ensure that local taxpayers and service users do not suffer unnecessarily in consequence.
Lord Rowallan: My Lords, I thank the Minister for that reply. I must declare an interest as a council tax payer in East Ayrshire. The North Lanarkshire shortfall of £4.8 million on its direct labour organisation and East Ayrshire's shortfall of £3 million for the second year running must mean that services for the council tax payers of those councils must be hard hit. Can the Minister assure me that the guilty councillors and/or officials responsible for the shortfall will pay for it rather than the council tax payers?
Lord Sewel: My Lords, at the moment it is clear that we are dealing with a case of incompetence rather than a case of corruption. An uncontrolled and unplanned deficit may well fall, at least in part, on the council tax payers. In the present circumstances, any local authority has a duty to cut non-essential expenditure immediately and to the bone. Perhaps those two authorities could take account of that and look at travel and entertainment expenditure. I should make it clear that there is no question of additional government grant.
Baroness Sharples: My Lords, the Minister speaks of action. What action does he propose to take?
Lord Sewel: My Lords, my right honourable friend the Secretary of State served formal notice on the two councils last week. They are required to provide certain information and have three weeks to do so. The Secretary of State can then direct them and use his power to require re-tendering or even the winding-up of the DLO.
Lord Hogg of Cumbernauld: My Lords, does my noble friend agree that the action taken by our right honourable friend the Secretary of State for Scotland stands in sharp contrast with the lack of action from the Conservative Government in relation to Westminster council? Comments on matters in North Lanarkshire and East Ayrshire would have more credibility if the Conservative Party had got round to dealing with the sleaze in Westminster council.
Lord Sewel: My Lords, I thank my noble friend for those accurate comments. In all seriousness, what happened in North Lanarkshire and East Ayrshire was unacceptable. In those circumstances, the real question is what we do as a government. We acted, and acted decisively.
Lord Mackay of Ardbrecknish: My Lords, I begin by congratulating the Minister on succeeding in gaining a place on his party's list as a candidate for the Scottish parliament. Is he aware that it must be a singular achievement for a Member of this place to pass what some people describe as the "Politburo" set up to vet candidates? Does the Minister have some regrets about the number of Labour local councillors who are sharing his position in the list, given the disrepute into which so many Labour councillors have brought Scottish local government? While the noble Lord, Lord Hogg, can name one council, what does the Minister have to say about Monklands—changed into North Lanarkshire to make it sound better—Paisley or Renfrew, where one MP committed suicide, another had to obtain police protection and a third has been suspended by his party for ages? The police had to go into that council 20 times and a senior policeman said, "If it had been a public house, we would have closed it down." We have the problems too of East Ayrshire and East Dunbartonshire. Words from the Government are fine. But action is necessary to protect local council tax payers and services to the public.
Lord Sewel: My Lords, my right honourable friend acted clearly, firmly and decisively. As a former leader of my own council, a former president of the Convention of Scottish Local Authorities and as a former member of the Accounts Commission in Scotland, I take seriously any improper action in local government, no matter which party or individuals are involved. I am also aware, as indeed is that other product of local government, the noble Lord, Lord Mackay of Ardbrecknish, of the great work so many councillors do for their communities. That should be recognised.

Sierra Leone: Arms Sales
2.57 p.m.
Lord Avebury: My Lords, I beg leave to ask a Question of which I have given the Government private notice, namely:
What evidence was given by Sir John Kerr to the Foreign Affairs Select Committee in another place concerning the briefing given to Ministers on the arms to Sierra Leone affair prior to the Answer given by the noble Baroness, Lady Symons of Vernham Dean, on 10th March?
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, I am very grateful to the noble Lord for raising this matter.
Perhaps I can begin by reminding the House of the single most important fact; that is, that once again there is in place in Sierra Leone a democractically elected government. The illegal rule of an undemocratic military regime has been ended. We on this side of the House welcome that. I hope that the whole House does too.
But, with the honourable exception of the noble Lord, Lord Moynihan, who I believe has tried to focus on the real issues, the Shadow Foreign Secretary and his team prefer to concentrate more on pieces of paper in London than on policy and real events, like today's summit in Cardiff.
On the issues which have been raised, let me make clear once again that the Government do not and did not support any breach of a United Nations embargo. Ministers had no prior knowledge or approval of arms sales to Sierra Leone.
Let us be clear about what the Government have done. The Government referred the issue to HM Customs and Excise for investigation. Customs investigated and concluded that there are no grounds for further action. With that investigation completed, the Government immediately established an inquiry, chaired by Sir Thomas Legg, into the handling of the matter within Whitehall. That inquiry is carrying out its work. Sir Thomas Legg is considering all the evidence. He will report on the whole issue. His report will be published. It will be the best means for the full facts to be established.
It would be wrong for me to enter into detailed discussions on the questions being examined by Sir Thomas Legg. I have no intention of pre-empting his findings. But, following press allegations, I believe it is appropriate for me to address the issue of my replies in this House on 10th March to a Starred Question from the noble Lord, Lord Avebury, and on 11th May as to when I first became aware of Sandline's involvement in Sierra Leone.
On 11th May, the noble Lord, Lord Moynihan, asked me when I first learnt of Sandline's involvement. I replied that I was first aware of allegations regarding
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Sandline's role in Sierra Leone when I saw the report in the Observer of 8th March. That is entirely correct. I saw the report in a newspaper on that Sunday morning. The headline was,
"Britain holds talks with hired killers",
the allegation being that the High Commission had been involved in secret talks with Sandline. Officials briefed me on that in preparation for the 10th March Question. So I did not mislead the House.
On 10th March I was asked about this article. The article did not refer to arms shipments or the breaking of UN sanctions. I said that the article was not entirely accurate or at least not on all fours with reports to Her Majesty's Government. That was entirely right. My answer was based on a speaking note prepared by the Foreign and Commonwealth Office which said that the High Commissioner had confirmed that allegations made in the article were wrong. I therefore did not mislead the House on that occasion either. I am sure that Sir Thomas Legg will want to look very carefully at this issue. All my briefing material has been made available to him.
The briefing for 10th March covered all aspects of the situation in Sierra Leone in preparation for the Question from the noble Lord, Lord Avebury, asking what steps Her Majesty's Government were taking to help restore lasting peace in Sierra Leone. As the Foreign Affairs Committee was told on 14th May, there was information contained in the background documentation about the allegation of arms supplies being referred to the appropriate authorities. But the clear focus was on what was happening in Sierra Leone; and rightly so.
I did not on 10th March announce a Customs investigation. I was not briefed to do so; and quite right. It would have been highly prejudicial and quite wrong to make the referral public at that stage. To do so would have alerted those who were potentially under investigation and would have been unfair to them if the allegations were subsequently found to be groundless. The notion that I or others in the FCO deliberately concealed these things to protect ourselves is particularly absurd given that it was the FCO itself that passed the accusations to Customs and Excise, which led to their investigation.
Moreover, the overwhelming issue at the time was the fighting in Sierra Leone and the welcome return of President Kabbah to Freetown on the very day I was speaking. Officials were helping to direct efforts to relieve a serious humanitarian situation on the ground. They were co-ordinating the return of our High Commissioner. They were closely involved as presidency of the EU and in action in the UN Security Council in framing the wider international response to the unfolding situation in Sierra Leone. My briefing correctly focused on these major developments, particularly as I was not involved in the policy-making chain on these issues.
Of course I did not deliberately mislead this House. I have made it clear now and in what I said on 10th March and 11th May that I did not do so inadvertently either. I reiterate what I said to the House on 11th May. If any of my remarks, today or at any other time, are found to be inaccurate, I will correct them. I trust that Members on the other side, in this House or in another place, will be ready to correct their ill-founded allegations.

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Let me return to the point that I made at the beginning. The minutiae that I have been forced to dwell on today have no bearing on the actual events in Sierra Leone, before or since. The situation in Sierra Leone remains serious, with atrocities by the rebels continuing. People would do better to focus on that or on some of the other grave foreign policy questions we are faced with rather than on this kind of specious nonsense.
3.3 p.m.
Lord Avebury: My Lords, we are most grateful to the noble Baroness for the comprehensive explanation that she has given and for the fact that she has gone much wider than the terms of the Question. Perhaps I may say how much we agree with her that it is not the minutiae we are concerned with but the wider issues of what will happen in Sierra Leone following the restoration of the democratic government and the other serious issues that arise out of the Customs and Excise investigation which have not yet been dealt with.
What are the special circumstances in which Customs and Excise decided not to bring proceedings against Sandline and Mr. Spicer, notwithstanding the fact that a clear breach of Security Council Resolution 1132 had been committed? Since the noble Baroness has widened the Answer, perhaps she can deal with that question now. Does she agree with me that even if the right result has been achieved in the end—that is to say, the restoration of democratic government under President Kabbah—if it has been achieved by unlawful means, in particular by a breach of a Security Council resolution, which is a serious matter as the Foreign Secretary has said, that provides an extraordinarily harmful example for dealing with future cases of this kind?
Does she further agree that a serious question arises about how we treat the so-called military consultants who were involved in this case? Is she aware that the South Africans have legislated to regulate the activities of companies such as these? Would we not do well to follow that example and even to bring forward an amendment to the United Nations Convention on Mercenaries so that the regulation would be of a universal character instead of being confined to one country?
Baroness Symons of Vernham Dean: My Lords, I would refer the noble Lord to the announcement made by HM Customs and Excise on 18th May that the Customs decision, confirmed by the Attorney-General, not to mount a prosecution was taken after considering all the circumstances leading up to the supply.
The noble Lord raised the unlawful means. There is no doubt that this matter has been considered very seriously. My right honourable friend the Prime Minister, my right honourable friend the Foreign Secretary and my honourable friend Mr. Lloyd and I have all said how seriously we take these issues. I reiterated that point again today in answering the noble Lord's Question, so I do not think there can be any doubt whatever about that.
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The noble Lord raised the question of military consultants and mentioned the interesting example of South Africa. I will ensure that I draw to the attention of my honourable friend Mr. Lloyd the very pertinent point that the noble Lord has made.
Lord Moynihan: My Lords, on 14th May I asked the noble Baroness whether, only three days before Customs officers raided Sandline on Friday 3rd April, Tony Lloyd, the relevant Foreign Office Minister, was in fact in Sierra Leone. In her own words, she said that she was unsighted on this issue but that she would write to me. A month has passed and I have received no letter. Is the noble Baroness now in a position to say whether she knew of the Minister's visit to Sierra Leone? Further to her statement on 11th May that she would not have expected to see details of the Customs and Excise investigation into Sandline, is she aware that other Ministers did indeed receive papers on this subject? Finally, was the briefing that she received for the Question of the noble Lord, Lord Avebury, in the House on 10th March either seen by or sent for the approval of any other Minister, given Sir John Kerr's evidence that a side copy of the brief was marked for Mr. Lloyd?
Baroness Symons of Vernham Dean: My Lords, I am very concerned that the noble Lord has not received a letter. On my return to the FCO today I shall ensure that a letter is sent to him as soon as possible.
The noble Lord raised other questions about the details of my briefing. In particular he asked whether my briefing had been sent to Mr.Lloyd. The noble Lord will know that Mr. Lloyd has said quite clearly that he did not receive any such briefing. He made a statement on this matter on 12th March. The exact statement was that he was not then briefed, told, advised or in any other way informed, either orally or in writing, either of alleged arms shipments or the Customs and Excise investigation. Clearly, this is a matter for Sir Thomas Legg. I think we must exercise some patience and look forward to what Sir Thomas Legg will have to say on these important issues.
Baroness Mallalieu: My Lords, can the Minister tell us what is happening in Sierra Leone at the moment?
Baroness Symons of Vernham Dean: My Lords, I can do my best. I made some reference to this in the Answer that I gave to the noble Lord, Lord Avebury. We understand that the forces of the RUF are regrouping. Sadly, reports of atrocities committed by them continue. Her Majesty's Government have taken a very strong lead in the international community. Since February we have been pursuing a consistent policy with close ministerial involvement. That involves securing a UN mandate for ECOMOG on the basis of a UN-approved disarmament and mobilisation plan; obtaining voluntary international funding to provide logistic support of ECOMOG needs; and providing humanitarian relief and plans for longer-term development and government with the Government of Sierra Leone. I hope that gives some flavour as to what is happening at the moment.
Lord Peyton of Yeovil: My Lords, in view of some the things that have been said on this subject since March, is

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the noble Baroness aware that on that occasion many of us—and I include myself—had the impression of a Minister who, under very difficult circumstances, was treating the House honestly, fairly and with considerable candour? I for one never had the impression that she was in any way misleading anybody and the Minister has confirmed that today. My next point goes rather wider than her concerns. Is she aware that some of the remarks addressed to Sir John Kerr in another place are very hard to go along with and, as far as I was concerned, were a source of considerable discomfort?
Baroness Symons of Vernham Dean: My Lords, I am truly grateful to the noble Lord for what he has said and I thank him very much. Sir John Kerr gave the same information on 9th June as he did on 14th May. In my briefing for 10th March there were references to allegations of illegal arms shipments being referred to the appropriate authority. I was, rightly, not briefed to reveal that referral for the very obvious reasons that I have given.

House of Lords' Offices: Select Committee Report
3.12 p.m.
The Chairman of Committees (Lord Boston of Faversham): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That the Fifth Report from the Select Committee on the House of Lords' Offices be agreed to (HL Paper 109).—(The Chairman of Committees.)
Following is the report referred to:
The Committee has met and been attended by the Clerk of the Parliaments and the Gentleman Usher of the Black Rod.
1. MILLENNIUM EXHIBITION
The Committee considered proposals for an exhibition on parliamentary democracy to be held in Westminster Hall in 2000 to celebrate the new millennium. The exhibition will be organised jointly with the House of Commons. The Committee agreed expenditure provision to be made in respect of the House of Lords contribution.
2. FILMING AND BROADCASTING IN THE HOUSE
The Committee took note of an agreement reached with BBC News and Current Affairs to allow filming until the end of November of a documentary about the House. In addition, Wall to Wall Television Ltd will be allowed access to the House to research a prospective documentary of the House.
3. HISTORY OF PARLIAMENT TRUST
The Committee were informed that the History of Parliament Trust has decided that, from 1999–2000, the House of Lords should form part of the programme of work of the Trust. The Committee agreed that the House of Lords should in future contribute to the funding of the Trust.
Lord Cocks of Hartcliffe: My Lords, I would like to thank the committee members for the work they do on our behalf. I wish to ask a question about paragraph 1 of the report dealing with the millennium exhibition. It states that there is to be an exhibition in Westminster Hall, organised jointly with the Commons. It says also,
"The Committee agreed expenditure provision to be made in respect of the House of Lords contribution".
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Can the Chairman of Committees say how much expenditure is involved? How much is capital expenditure and how much constitutes running costs? I cannot believe that in these times of financial prudence the House is being asked to give a blank cheque. So I look forward to details from the Chairman of Committees, because, if we do not get them now, in future, if there is dissent about this expenditure, I fear that we shall be given the formula that it has been considered by the relevant committees, approved by the House and a line will then be drawn underneath it. More details should be given when we have such reports. Otherwise the House is being treated unfairly and its authority sought without the fullest information being made available for people to make up their minds.
Lord Peyton of Yeovil: My Lords, I support what the noble Lord, Lord Cocks, says. One wonders where this proposal originated, how much it is going to cost and how much your Lordships' House is going to pay as opposed to the other place. Cannot the Chairman of Committees envisage the possibility that unkind people may suggest that it would be preferable if an exhibition on democracy in Westminster Hall were replaced by a constant display of democracy elsewhere, and particularly in another place down the road?
The Chairman of Committees: My Lords, I shall deal with all of the matters raised by the noble Lords, Lord Cocks of Hartcliffe and Lord Peyton. Perhaps I should not venture into speculation about the final point raised by the noble Lord, Lord Peyton, tempted though I am to do so.
As regards costs, the Administration and Works Sub-Committee and the Offices Committee, in making these recommendations to your Lordships, felt it right to agree in principle to a capital cost provided that the two Houses of Parliament went ahead together. I hope that your Lordships will feel that that is right. There can be no question of one House of Parliament going ahead with this idea. The Offices Committee, on the advice of the Administration and Works Sub-Committee, suggests that this House should contribute £50,000 towards the costs. If another place decides to join in supporting the project, it should authorise an equivalent sum.
The sum of £5,000, shared jointly between the two parties, has been spent so far in commissioning an adviser. She is an expert in interpreting historic buildings to the general public. I am advised that she has considerable experience in the matter. She was commissioned to help the working group of officials from the two Houses establish the basis of what became the proposal for an exhibition on parliamentary democracy.
I refer now to a specific point raised by the noble Lord, Lord Cocks of Hartcliffe. At the moment, much as I would like to do so, I am unable to give your Lordships any information about running costs. I am advised that they would add quite considerably to the capital cost of £100,000 shared between the two Houses. Those costs are in the process of being assessed. It will probably not be until towards the end of the year—certainly later in the year—that I shall be able to advise your Lordships of the precise amount.

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In answer to another of the perfectly fair and valid points raised, there is no question at all of your Lordships' committees committing this House to any proposals. They will have to be scrutinised by the committees in the first place and then come before your Lordships for authorisation.
Lord Peyton of Yeovil: My Lords, I thank the noble Lord for the immense relief that he has given, at any rate to me, in saying that the lady concerned is a well-known interpreter of old buildings. I am so glad to know that she is not going to devote her undoubtedly immense talent to interpreting some of the so-called practitioners of democracy who claim to be alive.
The Chairman of Committees: My Lords, I am very grateful. The noble Lord, Lord Peyton—and myself to a lesser extent—can speak from personal experience of those considerations from our time in another place.
Although I cannot give the figures, for the reasons I have explained, perhaps I may help a little further on the question of costs. If the project goes ahead, running costs will have to be met by the two Houses. I am advised that additional security would form a substantial element but lesser amounts would also be needed for practical facilities such as lavatories for members of the public attending the exhibition, if it goes ahead.
It may be appropriate to mention one other consideration regarding costs. It has been suggested that an admission charge should be considered. Again, that would need to come before your Lordships for consideration. The admission charge, if it were to be introduced, would help quite significantly to meet the overall costs of the exhibition.
I am sorry not to be able to give further details at the moment, but there is the assurance, which I hope will bring some comfort in particular to the noble Lords, Lord Peyton and Lord Cocks, as well as to other noble Lords, that these matters will need to be further considered by your Lordships' House before they can go ahead. I understand that the House of Commons Commission, which will consider these matters, is meeting this afternoon.
On Question, Motion agreed to.

Building Regulations (Energy Rating Information) (Amendment) Bill [H.L.]
3.20 p.m.
Baroness Nicol: 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 Nicol.)
On Question, Motion agreed to.

Government of Wales Bill
3.21 p.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Williams of Mostyn): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Lord Williams of Mostyn.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Lord Hunt of Kings Heath Lord Hunt of Kings Heath moved Amendment No. 244:
After Clause 112, insert the following new clause—
("Health Advisory Council for Wales
HEALTH ADVISORY COUNCIL FOR WALES
.—(1) The Assembly shall establish and maintain a body to be known as the Health Advisory Council for Wales or Cyngor Iechyd Ymgynghorol Cymru (but referred to in this Act as the Health Council).
(2) The Health Council shall consist of Assembly members and members of—

(a) a health authority for an area in, or consisting of, Wales;

(b) a National Health Service Trust all or some of whose hospitals, establishments or other facilities, are situated in Wales;

(c) local representative committees in Wales of primary care professionals.

(3) The Health Council may—

(a) give advice to the Assembly about matters affecting the exercise of any of the Assembly's functions in relation to the strategic direction of the National Health Service in Wales;

(b) make representations to the Assembly about any matters affecting, or of concern to, those employed by or involved in the National Health Service in Wales; and

(c) give advice to those employed by or involved in the National Health Service in Wales.

(4) The health subject committee of the Assembly shall consult the Health Council as to any order which it contemplates making affecting health and health services.
(5) The Assembly shall appoint as members of the Health Council—

(a) the Assembly members who are members of the health subject committee; and

(b) as many members of—

(i) a health authority for an area in, or consisting of, Wales,

(ii) a National Health Service Trust all or some of whose hospitals, establishments or other facilities are situated in Wales, and

(iii) local representative committees of primary care professionals,

as the Assembly considers appropriate.
(6) The Assembly shall appoint one of the members of the Health Council to be its chairman.
(7) The Health Council shall meet at least twice a year.
(8) The Health Council shall lay before the Assembly an annual report on the performance of its functions.").
The noble Lord said: The purpose of this amendment is to establish a health advisory council of the assembly with a membership covering both the special subject committee and the National Health Service in Wales. The purpose of such a council would be to advise the assembly about strategic matters relating to the NHS in Wales, and to advise the NHS in Wales itself.
I am a long-standing admirer of the National Health Service in Wales. Over the 50 years of its operation it has produced a consistently high standard of service both in extreme rural areas and in the large conurbations. It has very high public and staff commitments and a very high standard of teaching and research. I believe that we have seen considerable innovations. I refer in particular to public health issues and to the development of an all-Wales mental health strategy.
I believe that the assembly will enhance the ability of the NHS to improve its services. The assembly starts with wide-ranging responsibilities: the allocation of resources to NHS organisations; holding those bodies to account; ensuring that the health of the people living in Wales improves and that there is a strategy for continuing to improve their health; and ensuring that the health service in Wales has an adequate and well-trained staff.
I am convinced that the assembly offers much opportunity to the NHS in Wales by, for example, allowing it to introduce more innovation without being in the shadow of the Department of Health in England, by ensuring a better appointments process to the non-executive positions on health authorities and trusts, and by allowing for cross-sectoral working. I believe that the various subject committees of the assembly, bringing together those with an interest in health, the environment, transport and housing, present a great opportunity to establish cohesive public health policies which will help to improve the health of many people. Finally, I welcome the ability to tailor resources to specific priorities in a way which I suspect has not been possible previously.
The success of that process depends crucially on the relationships between the relevant assembly secretary, the relevant subject committee and the NHS in Wales. The National Assembly Advisory Group offered much helpful advice on, for example, the checks and balances that need to be in place, the role of the assembly secretary and the role of the subject committee, which will have the job of holding the assembly secretary to account, putting its views on the budget of the NHS in Wales to the executive committee, making recommendations on policy and scrutinising secondary legislation.
All of that represents extremely useful advice, but I suspect that there is always the danger that the subject committee may be tempted to involve itself too greatly in operational management at field level and deal rather less with strategic leadership, proper monitoring and holding the NHS to account. That problem is not exclusive to the work of the new assembly. Indeed, the NHS has been bedevilled over the years by too much
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operational interference in management at local level by the four departments of health throughout the United Kingdom. We have seen the continual second-guessing of decisions, the slowing down of decision-making and, in many cases, the inhibition of effective management at local level. Perhaps we took Aneurin Bevan's words too literally when he said that when a bedpan drops in a ward in St. Thomas's Hospital, its echo should resound in the Palace of Westminster. I suspect that over the past 50 years rather too many bedpans have been dropped and rather a lot of echoes have been heard in this House and in another place.
That is where an advisory council would come into play. It could help to clarify sensibly the relationship between the assembly and the NHS in Wales. It could ensure that the subject committee has access to advice from people in the field. It could encourage the assembly subject committee to focus on strategic leadership and direction. It would, I am sure, create confidence in the NHS about the activities of the assembly. It could ensure that policy and secondary legislation would be tested by the people who have to operate it at field level. I am sure that it could ensure that the performance management of the NHS would be that much more effective.
The Bill already allows for a partnership council between the assembly and local authorities. It allows for a scheme to promote the interests of voluntary organisations. It allows for consultation with business on the impact of the assembly. It would be a great pity if the Bill did not contain a specific reference to the National Health Service in that regard. After all, the NHS is the largest single employer in Wales, with 68,000 people working directly for it. Another 8,500 GPs and dentists are contracted to the NHS. Its budget in the last financial year was £2.4 billion, some 34 per cent. of the entire Welsh Office budget.
So the performance of the NHS in Wales is crucial to the performance of the assembly. Getting right the relationship between the assembly and the NHS is essential. I am sure that an advisory council would help enormously. I beg to move.
3.30 p.m.
Lord Roberts of Conwy: Members of the Committee will recall that we touched on the health service in Wales when we discussed Clause 28 which gives the assembly powers over health authorities in Wales. I drew attention then to the changes that the Government are already promoting in the NHS in anticipation of the advent of the assembly. The health authorities—already reduced to five—may be reduced still further. The trusts are to be reduced—their number is almost to be halved—from 29 to about 15.
I am not criticising those changes in themselves although many people in Wales do criticise them; but I am critical of the timing. For example, it is unfair that the new configuration of the trusts is due to be in place on 1st April next year, exactly one month before the assembly elections. Much of the future structure of the NHS in Wales will be fixed before the assembly takes over responsibility. In short, the views and consideration

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of the assembly are being pre-empted to a large extent. Perhaps that is a reason why the Government do not propose a co-operative scheme with the NHS as with the local authorities and voluntary organisations.
The Welsh Office has been the regional tier of the NHS in Wales. I believe that there were 18 regional tiers in England. Therefore, the relationship between the Welsh Office and the NHS traditionally has been very close. It is many years since I had personal ministerial responsibility for the NHS in Wales, but I do not believe that the close, almost intimate, nature of that responsibility has changed a great deal over the years. It is a unique ministerial role. It was one I enjoyed immensely and look back upon with great satisfaction. During that time we built a string of major new hospitals across the north and south of Wales and introduced new developments such as the 10-year strategy for improving the life of the mentally handicapped who are now referred to as people with learning difficulties. That strategy has been referred to by the noble Lord, Lord Hunt of Kings Heath.
I trust that whoever becomes assembly secretary responsible for health will find the job as rewarding as I did. He or she will certainly find the officers and staff of the NHS in Wales wonderful people to work with and for. One possible inspiration for the new clause and the health advisory council that is proposed is the partnership council between the assembly and local authorities to be set up under Clause 113. There are a number of similarities between the proposed health council and partnership council and the assembly and local government. There are also subtle differences. For example, assembly membership of the partnership council is not confined to the committee that deals with local government while membership of the health council is specific on that point. There are 22 unitary authorities in Wales. They are generally in favour of the Government's proposals for devolution, unlike the county councils in 1979 who were against because they viewed a national assembly as a threat to their power and possibly their resources.
The Government are surely right to believe that there must be close understanding and co-operation between the assembly and local authorities; certainly, they cannot be at loggerheads. But at the end of the day the assembly rules. Like the noble Lord, Lord Hunt, I question why the Government have sought this partnership with the local authorities and a scheme with the voluntary bodies but nothing specific to do with the NHS. I suspect that the real reason why there is no such proposal is the close connection between Ministers at the Welsh Office and the NHS, the Welsh Office being the regional tier, and the belief of the Welsh Office that the closeness of the relationship will be transferred from the Secretary of State to the assembly.
I believe that the real inspiration for the health council lies deeper; that is, in the personal professional experience of noble Lords themselves. The noble Lord, Lord Prys-Davies, has been intimately connected with the health service in Wales. Clearly, noble Lords want a national forum for the NHS in Wales with a strong advisory and consultative role. It is interesting that noble Lords do not follow the Government's line in asking the
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assembly to make a scheme with health authorities and local government and with voluntary organisations as in Clause 114. Noble Lords are to be admired; they do not mess about but come straight to their health council. A very substantial, powerful body is proposed; it comprises members of the assembly's health committee. But one wonders whether it is a mistake to include them in an advisory body when they may very well carry executive responsibility. How could they advise themselves? The mix could prove embarrassing.
If the Government are inclined to accept the new clause, I believe that they should take it away and re-model it between now and Report stage if only to remove the ambiguity whereby members of the assembly's health committee who may very well occupy an executive position are also members of what is basically an advisory body. I look forward to the comments of the noble Lord the Minister in due course.
Lord Prys-Davies: I shall always be grateful to two Secretaries of State, one a Labour Secretary of State, my noble friend Lord Clinton-Davis, and the other a Conservative Secretary of State, the noble Lord, Lord Thomas of Gwydir, who many years ago gave me the opportunity to serve the NHS in Wales for about half a dozen years. I have never lost interest in the NHS.
The statistics cited by my noble friend demonstrate that the assembly's responsibilities for the NHS in Wales will be most important. It may be that the amendment is imperfect. I agree with the noble Lord, Lord Roberts of Conwy, that perhaps there is need to reflect on the precise wording of the amendment. However, I believe that the principle of the amendment recognises the importance of the health service in Wales. I hope that the Committee and the Government will see merit in the assembly having a statutory advisory health council.
The case for the amendment has been made by my noble friend Lord Hunt and there is very little that I can add. However, I should like to emphasise two or three points. First, the advisory council would enable the assembly to draw on the advice of those involved in the NHS in Wales. That advice would be based on their knowledge and experience. If the Government were willing to consider the drafting of the amendment I would feel comfortable with the extension of the membership to those men and women who had an interest and expertise in the health service. I could mention some names to the Committee but I shall not embarrass them.
Secondly, my noble friend may say that it is open to the assembly to establish a sub-committee to advise it on the NHS in Wales, and that I accept. However, there is a distinction. A statutory advisory body would give statutory recognition to the contribution of the NHS staff who work extraordinarily hard on modest salaries. If it were statutory, it would enhance the status of the committee and the NHS in Wales.
The noble Lord, Lord Roberts of Conwy, drew attention to the provisions in the Bill for a local government partnership council and the scheme for the voluntary bodies in Wales. Those are fair points to

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make. But we can distinguish our case from that of the partnership council, local government and the voluntary scheme. The partnership council will be a partnership between two tiers of democratic government. We shall discuss the voluntary bodies in Wales later. However, in the legal sense a distinction can be drawn between the NHS and the voluntary bodies. The NHS will be an agent of the assembly. That leads to the point raised by the noble Lord, Lord Roberts, but I believe that it could be resolved.
Finally, I believe that the NHS undoubtedly owes a part of its inspiration to the medical aid societies and the miners' hospital committees of the South Wales coalfields in the first half of this century. The best way in Wales this year to respect and celebrate the 50th anniversary of the NHS is by embodying a statutory health advisory body composed of representatives of NHS staff in the highest council of government in Wales in the new century.
I hope that the Government will give careful consideration to the amendment so ably moved by my noble friend Lord Hunt.
3.45 p.m.
Lord Williams of Mostyn: I acknowledge at once that all three speeches in relation to the amendment were extremely informed and constructive. I recognise the reasoning underlying the proposal to have a health advisory council (Cyngor Iechyd Ymgynghorol Cymru). I readily pay tribute to all three noble Lords who spoke. The noble Lord, Lord Roberts of Conwy, is right. There have been extremely close, well developed arrangements in place for effective consultation between the Welsh Office and the National Health Service. I endorse the tributes he paid to the personnel involved over the many years, of which he knows much more than I.
It is right to say that the policies have been developed on the basis of close co-operative dialogue and jointly. We have the Health Policy Board chaired by the Secretary of State with members from the chairmen of health authorities in Wales. There is regular contact between Ministers, as again the noble Lord indicated, with the chairmen and chairwomen of the National Health Service organisations; and there are constant formal and informal contacts on a regular basis, not least through the Trust Executive Advisory Group.
There is no reason to suppose that those relations will not continue between the assembly and the NHS. There is nothing in the Bill to stop the assembly from either preserving inherited mechanisms or—if it wishes to as its own powers develop and experience demonstrates to it—arranging alternative processes for consultation with the NHS as well as the handling of subsequent business. It is entirely open to the assembly as the work beds down to establish a help advisory council for Wales, as now proposed by my noble friend Lord Hunt.
We think it better to leave it to the assembly to see how things will develop. It will inherit various statutory advisory committees covering the health professions, and it will have to have, as the noble Lord,
1300
Lord Roberts, again indicated, constant contact with NHS bodies and contractor professions. We are presently producing a corporate plan for the NHS in Wales. It is headed by a senior NHS officer. It is supported by a Welsh Office/National Health Service team. It will provide a clear strategic framework in the plan for supervision and direction of the long-term operation and development of the service in Wales.
We do not think, therefore, that specific provision on the face of the Bill is presently required. There would be some difficulties in areas such as subordinate legislation because one would have to convene the council to pass such measures as orders; and that would slow down matters in a way which would not be necessary. I very much respected the views put forward by my noble friend Lord Hunt during Second Reading. He said, and I agree with him, that there are risks sometimes in an over-prescriptive approach. We think that the best course is to allow the present arrangements to continue and for the assembly to judge on experience as matters eventually transpire. Local government is different because it is directly accountable via the ballot box.
I relate specifically to a few remarks of the noble Lord, Lord Roberts. I can assure the noble Lord that we are not seeking to constrain the assembly's freedom. Quite the opposite. We want the organic relationship between the assembly and the NHS in all its manifestations to develop on an incremental basis on the basis of experience. I stress this again. The noble Lord is right. The assembly will be able to modify and change what it inherits.
It seems to me that the four of us who addressed the Committee share the same purpose. We have equal regard to what the NHS has done and to the needs for improvement and change in the future. I come to the conclusion that we should not be over-prescriptive but should leave it to the assembly, since this is a devolution of powers, to see how it best wishes to maintain or alter arrangements in the future.
Lord Thomas of Gresford: I am sure that we are all grateful to the noble Lords, Lord Hunt of Kings Heath, and Lord Prys-Davies, for bringing this important matter before the Committee. However, we believe that the functions of the assembly should not be fettered. As the noble Lord pointed out when introducing the matter, the National Health Service will be an important part of the work of the assembly consisting, as it does, of such an important percentage of the budget, and involving so many functions that the assembly will have to consider.
We are sure that the present arrangements are satisfactory for the moment. If the assembly finds them unsatisfactory, no doubt it will take the appropriate steps to ensure that the continuing good relationships between Government and the health service continue, and that there is proper communication between all parts of the National Health Service to ensure that the people of Wales are properly served.
Lord Hunt of Kings Heath: I am most grateful to noble Lords and my noble friends for their contribution to the debate. I have great confidence in the NHS in Wales, the people who work there, and the civil servants

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responsible for administering the NHS from the Welsh Office. I acknowledge the good relationships between the NHS and the Welsh Office. I accept that through the principle of devolution it is for the assembly to decide many of these matters. The legislation before us allows for a partnership council with local government, and for arrangements in respect of voluntary organisations and with business. A statutory advisory council would have been a strong visible sign to all in the NHS in Wales. It would have assured a proper relationship between the NHS and the assembly.
Nevertheless, I have listened with great care to what my noble friend has said. No doubt we may discuss this later on. At this stage, I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
Lord Williams of Mostyn Lord Williams of Mostyn moved Amendments Nos. 245 and 246:
Before Schedule 8, insert the following new schedule—

SCHEDULE
WELSH ADMINISTRATION OMBUDSMAN
PART I

  THE OMBUDSMAN
  Appointment
  1.—(1) The Welsh Administration Ombudsman shall be appointed by Her Majesty.
  (2) Subject to sub-paragraphs (3) and (4), the Welsh Administration Ombudsman shall hold office until the end of the year of service in which he attains the age of 65.
  (3) Her Majesty may relieve the Welsh Administration Ombudsman of office before the end of that year of service—

  (a) at his request, or

  (b) on Her Majesty being satisfied that he is incapable for medical reasons of performing the duties of his office and of requesting to be relieved of it.

  (4) Her Majesty may remove the Welsh Administration Ombudsman from office before the end of the year of service in which he attains the age of 65 if, on the ground of misbehaviour, the Secretary of State recommends that Her Majesty should do so; but the Secretary of State shall not so recommend without consulting the Assembly.
  Status
  2.—(1) The person for the time being holding the office of Welsh Administration Ombudsman shall by the name of that office be a corporation sole.
  (2) The Welsh Administration Ombudsman shall be regarded as holding office under Her Majesty and as exercising his functions on behalf of the Crown.
  (3) Service as the Welsh Administration Ombudsman shall not be service in Her Majesty's Home Civil Service but he shall be taken to be a Crown servant for the purposes of the Official Secrets Act 1989.
  Acting Welsh Administration Ombudsman
  3.—(1) Where the office of Welsh Administration Ombudsman becomes vacant, Her Majesty may, at any time during the period of twelve months beginning with the date on which the vacancy arose, appoint a person to act as the Welsh Administration Ombudsman.
  (2) Subject to sub-paragraphs (3) to (5), an acting Welsh Administration Ombudsman shall hold office in accordance with the terms of his appointment.
  (3) An acting Welsh Administration Ombudsman shall not hold office after—

  (a) the appointment of a new Welsh Administration Ombudsman, or

  (b) the end of the period of twelve months beginning with the date on which the vacancy arose,

  whichever occurs first.
  (4) Her Majesty may at any time relieve an acting Welsh Administration Ombudsman of office—

  (a) at his request, or

  (b) on Her Majesty being satisfied that he is incapable for medical reasons of performing the duties of his office and of requesting to be relieved of it.

  (5) Her Majesty may remove an acting Welsh Administration Ombudsman from office at any time if, on the ground of misbehaviour, the Secretary of State recommends that Her Majesty should do so; but the Secretary of State shall not so recommend without consulting the Assembly.
  (6) A person appointed under this paragraph shall, while he holds office, be regarded for all purposes (except those of paragraph 1 and this paragraph) as the Welsh Administration Ombudsman.
  Remuneration
  4.—(1) The Assembly shall—

  (a) pay the Welsh Administration Ombudsman such salary and any such allowances, and

  (b) make any such payments towards the provision of superannuation benefits for or in respect of him,

  as may be provided for by or under the terms of his appointment.
  (2) But where a person is both Parliamentary Commissioner for Administration and Welsh Administration Ombudsman he shall not be entitled to any salary as Welsh Administration Ombudsman.
  (3) The Assembly shall pay to or in respect of a person who has ceased to hold office as Welsh Administration Ombudsman such amounts (if any) by way of—

  (a) pension or gratuities, or

  (b) provision for those benefits,

  as may have been provided for by or under the terms of his appointment.
  (4) In Schedule 1 to the Superannuation Act 1972 (offices etc. to which section 1 of that Act applies), in the list of "Offices" insert—
  "Welsh Administration Ombudsman."
  (5) The Assembly shall pay to the Minister for the Civil Service, at such times as he may direct, such sums as he may determine in respect of any increase attributable to sub-paragraph (4) in the sums payable out of money provided by Parliament under the Superannuation Act 1972.
  Staff and advisers
  5.—(1) The Welsh Administration Ombudsman may appoint such staff as he considers necessary for assisting him in the exercise of his functions.
  (2) The Welsh Administration Ombudsman shall include among his staff such persons having a command of the Welsh language as he considers are needed to enable him to investigate complaints in Welsh.
  (3) Service as a member of the staff of the Welsh Administration Ombudsman shall be service in Her Majesty's Home Civil Service.
  (4) The Assembly shall pay to the Minister for the Civil Service, at such times as he may direct, such sums as he may determine in respect of any increase attributable to sub-paragraph (3) in the sums payable out of money provided by Parliament under the Superannuation Act 1972.
  (5) Any function of the Welsh Administration Ombudsman may be exercised by—

  (a) a member of his staff,

  (b) a member of the staff of the Health Service Commissioner for Wales, or

  (c) an officer of the Parliamentary Commissioner for Administration or of either of the other Health Service Commissioners,

  if authorised by the Welsh Administration Ombudsman for that purpose; and references in any enactment to a member of the staff of the Welsh Administration Ombudsman include any person exercising any function of his by virtue of paragraph (b) or (c).
  (6) To assist him in the exercise of his functions the Welsh Administration Ombudsman may obtain advice from any person who, in his opinion, is qualified to give it.
  (7) The Welsh Administration Ombudsman may pay to any person from whom he obtains advice under sub-paragraph (6) any such fees or allowances as he may determine.
  (8) No arrangements shall be made—

  (a) for any of the functions of the Welsh Administration Ombudsman or of the Assembly to be exercised by the other or by a member of the other's staff, or

  (b) for the provision of any administrative, professional or technical services by the Welsh Administration Ombudsman or the Assembly for the other.

  Reports
  6.—(1) The Welsh Administration Ombudsman—

  (a) shall annually prepare and lay before the Assembly a general report on the performance of his functions, and

  (b) may from time to time prepare and lay before the Assembly such other reports with respect to his functions as he thinks fit.

  (2) The Assembly shall, and the Welsh Administration Ombudsman may, publish reports laid before the Assembly under this paragraph.
  Expenses
  7.—(1) The expenses of the Welsh Administration Ombudsman shall, so far as they cannot be met out of income received by him, be met by the Assembly.
  (2) Those expenses include any sums payable by the Welsh Administration Ombudsman in consequence of a breach, in the course of the performance of any of his functions, of any contractual or other duty (whether that breach occurs by reason of his act or omission or that of a member of his staff or any other person assisting him in the exercise of his functions).
  Estimates
  8.—(1) For each financial year of the Assembly after the first, the Welsh Administration Ombudsman shall prepare, and submit to the executive committee, an estimate of the income and expenses of his office.
  (2) Each such estimate shall be submitted to the executive committee at least five months before the beginning of the financial year to which it relates.
  (3) The executive committee shall examine each such estimate submitted to it and, after having done so, shall lay the estimate before the Assembly with any such modifications as the committee thinks fit.
  (4) Where the executive committee proposes to lay such an estimate before the Assembly with modifications, the committee shall first consult the Secretary of State and have regard to any advice which he may give.
  Accounts
  9.—(1) The Welsh Administration Ombudsman shall keep proper accounting records.
  (2) The Welsh Administration Ombudsman shall, for each financial year of the Assembly, prepare accounts in accordance with directions given to him by the Treasury.
  (3) The directions which the Treasury may give under sub-paragraph (2) include, in particular, directions as to—

  (a) the information to be contained in the accounts and the manner in which it is to be presented,

  (b) the methods and principles in accordance with which the accounts are to be prepared, and

  (c) the additional information (if any) that is to accompany the accounts.

  Audit
  10.—(1) The accounts prepared by the Welsh Administration Ombudsman for any financial year of the Assembly shall be submitted by him to the Auditor General for Wales no later than five months after the end of that financial year.
  (2) The Auditor General for Wales shall—

  (a) examine and certify any accounts submitted to him under this paragraph, and

  (b) no later than four months after the accounts are submitted to him, lay before the Assembly a copy of them as certified by him together with his report on them.

  (3) In examining any accounts submitted to him under this paragraph, the Auditor General for Wales shall, in particular, satisfy himself that the expenditure to which the accounts relate has been incurred lawfully and in accordance with the authority which governs it.
  Accounting officer
  11.—(1) The accounting officer for the Office of the Welsh Administration Ombudsman shall be the Welsh Administration Ombudsman.
  (2) But where—

  (a) the Welsh Administration Ombudsman is incapable of discharging his responsibilities as accounting officer, or

  (b) the office of Welsh Administration Ombudsman is vacant (and there is no acting Welsh Administration Ombudsman),

  the Treasury may designate a member of the Welsh Administration Ombudsman's staff to be the accounting officer for so long as paragraph (a) or (b) applies.
  (3) The accounting officer for the Office of the Welsh Administration Ombudsman shall have, in relation to the accounts of the Welsh Administration Ombudsman and the finances of the Office of the Welsh Administration Ombudsman, the responsibilities which are from time to time specified by the Treasury.
  (4) In this paragraph references to responsibilities include in particular—

  (a) responsibilities in relation to the signing of accounts,

  (b) responsibilities for the propriety and regularity of the finances of the Office of the Welsh Administration Ombudsman, and

  (c) responsibilities for the economy, efficiency and effectiveness with which the resources of the Office of the Welsh Administration Ombudsman are used.

  (5) The responsibilities which may be specified under this paragraph include responsibilities owed to—

  (a) the Assembly, the executive committee or the Audit Committee, or

  (b) the House of Commons or its Committee of Public Accounts.

  (6) If requested to do so by the House of Commons Committee of Public Accounts, the Audit Committee may—

  (a) on behalf of the Committee of Public Accounts take evidence from the accounting officer for the Office of the Welsh Administration Ombudsman, and

  (b) report to the Committee of Public Accounts and transmit to that Committee any evidence so taken.

  (7) In this paragraph and paragraphs 12 and 13 "the Office of the Welsh Administration Ombudsman" means the Welsh Administration Ombudsman and the members of his staff.
  Examinations into use of resources
  12.—(1) The Auditor General for Wales may carry out examinations into the economy, efficiency and effectiveness with which the Welsh Administration Ombudsman has used the resources of the Office of the Welsh Administration Ombudsman in discharging his functions.
  (2) Sub-paragraph (1) shall not be construed as entitling the Auditor General for Wales to question the merits of the policy objectives of the Welsh Administration Ombudsman.
  (3) In determining how to exercise his functions under this paragraph, the Auditor General for Wales shall take into account the views of the Audit Committee as to the examinations which he should carry out under this paragraph.
  (4) The Auditor General for Wales may lay before the Assembly a report of the results of any examination carried out by him under this paragraph.
  (5) The Auditor General for Wales and the Comptroller and Auditor General may co-operate with, and give assistance to, each other in connection with the carrying out of examinations in respect of the Welsh Administration Ombudsman under this paragraph or section 7 of the National Audit Act 1983 (economy etc. examinations).
  Examinations by the Comptroller and Auditor General
  13.—(1) For the purpose of enabling him to carry out examinations into, and report to Parliament on, the finances of the Office of the Welsh Administration Ombudsman, the Comptroller and Auditor General—

  (a) shall have a right of access at all reasonable times to all such documents in the custody or under the control of the Welsh Administration Ombudsman, or of the Auditor General for Wales, as he may reasonably require for that purpose, and

  (b) shall be entitled to require from any person holding or accountable for any of those documents any assistance, information or explanation which he reasonably thinks necessary for that purpose.

  (2) The Comptroller and Auditor General shall—

  (a) consult the Auditor General for Wales, and,

  (b) take into account any relevant work done or being done by the Auditor General for Wales,

  before he acts in reliance on sub-paragraph (1) or carries out an examination in respect of the Welsh Administration Ombudsman under section 7 of the National Audit Act 1983 (economy etc. examinations).

PART II

  INVESTIGATION OF COMPLAINTS
  Bodies subject to investigation
  14.—(1) The bodies subject to investigation by the Welsh Administration Ombudsman are—

  (a) the Assembly,

  (b) the Arts Council of Wales,

  (c) the Countryside Council for Wales,

  (d) the Environment Agency,

  (e) the Forestry Commission,

  (f) the Office of Her Majesty's Chief Inspector of Schools in Wales,

  (g) the Sports Council for Wales,

  (h) the Wales Tourist Board,

  (i) the Welsh Development Agency, and

  (j) the Welsh Language Board.

  (2) In the case of the Environment Agency an investigation may be conducted by the Welsh Administration Ombudsman only in respect of action in connection with any of its functions in relation to—

  (a) Wales, or

  (b) an area of the sea adjoining either the coast of Wales or an area of the sea forming part of Wales,

  other than its flood defence functions (within the meaning of the Water Resources Act 1991).
  (3) In the case of the Forestry Commission an investigation may be conducted by the Welsh Administration Ombudsman only in respect of action in connection with functions of the Forestry Commissioners in relation to Wales.
  (4) Subject to paragraph 15, the Assembly may by order amend sub-paragraph (1) by—

  (a) adding any body,

  (b) omitting any body other than the Assembly, or

  (c) altering the description of any body.

  (5) For the purposes of this paragraph and paragraph 15 references to a body include a government department and an unincorporated body (as well as a body corporate); and references in this Schedule to a body subject to investigation by the Welsh Administration Ombudsman shall be construed accordingly.
  (6) References in the following provisions of this Schedule to action taken in the exercise of functions of a body subject to investigation by the Welsh Administration Ombudsman include action taken in the exercise of any functions of—

  (a) any of its members or (in the case of a government department) any of its Ministers, or

  (b) any of its officers or members of its staff.

  15.—(1) An order under sub-paragraph (4) of paragraph 14 may only add a body to sub-paragraph (1) of that paragraph if—

  (a) the body has functions exercisable in relation to Wales or a part of Wales (whether or not they are also exercisable otherwise than in relation to Wales),

  (b) some or all of those functions are in a field in which the Assembly has functions, and

  (c) the body either exercises its functions on behalf of the Crown or falls within sub-paragraph (2) of this paragraph.

  (2) A body falls within this sub-paragraph if—

  (a) it is established under an enactment or by virtue of Her Majesty's prerogative or is established in any other way by a Minister of the Crown or government department or by the Assembly,

  (b) at least half of its expenditure on the exercise of functions in relation to Wales (or, where its functions relate only to a part of Wales, in relation to the part of Wales to which they relate) is met directly from payments made by the Assembly, and

  (c) it is wholly or partly constituted by appointment made by Her Majesty, a Minister of the Crown or government department or the Assembly.

  (3) An order under sub-paragraph (4) of paragraph 14 adding a body to sub-paragraph (1) of that paragraph may provide that an investigation may be conducted by the Welsh Administration Ombudsman only in respect of action of a specified description taken by or on behalf of the body.
  (4) If an order under sub-paragraph (4) of paragraph 14 adds to sub-paragraph (1) of that paragraph a body which exercises functions otherwise than in relation to Wales (as well as in relation to Wales or a part of Wales), the order shall provide that an investigation may be conducted by the Welsh Administration Ombudsman only in respect of action in connection with its functions in relation to Wales or a part of Wales.
  (5) If an order under sub-paragraph (4) of paragraph 14 adds to sub-paragraph (1) of that paragraph a body which has functions in a field in which the Assembly does not have functions (as well as in a field in which it does), the order shall provide that an investigation

  1307
  may be conducted by the Welsh Administration Ombudsman only in respect of action in connection with its functions in a field in which the Assembly has functions.
  (6) An order under sub-paragraph (4) of paragraph 14 shall not add a body to sub-paragraph (1) of that paragraph if the result of adding it would be that the Welsh Administration Ombudsman could investigate action which can be investigated by the Parliamentary Commissioner for Administration under the Parliamentary Commissioner Act 1967.
  (7) An order under sub-paragraph (4) of paragraph 14 shall not add to sub-paragraph (1) of that paragraph a body whose sole activity is, or whose main activities are, included among any one or more of the following—

  (a) the provision of education,

  (b) the development of curricula, the conduct of examinations or the validation of educational courses,

  (c) the provision of training otherwise than under the Industrial Training Act 1982,

  (d) the control of entry to any profession or the regulation of the conduct of members of any profession, and

  (e) the investigation of complaints by members of the public regarding the actions of any person or body or the supervision or review of, or of steps taken following, such an investigation,

  or a body operating in an exclusively or predominantly commercial manner or carrying on under national ownership an industry or undertaking or part of an industry or undertaking.
  (8) If and to the extent that a function is exercisable in relation to—

  (a) the Welsh language or any other aspect of Welsh culture, or

  (b) an area of the sea adjoining either the coast of Wales or an area of the sea forming part of Wales,

  it shall be regarded for the purposes of this paragraph as exercisable in relation to Wales.
  Matters which may be investigated
  16.—(1) The Welsh Administration Ombudsman may investigate any action taken by or on behalf of a body subject to investigation by him if—

  (a) the action was taken in the exercise of administrative functions of that body, and

  (b) a written complaint is duly made to him by a person who claims to have sustained injustice in consequence of maladministration in connection with the action ("the person aggrieved").

  (2) For the purposes of this Schedule administrative functions exercisable by any person appointed as a member of the administrative staff of a relevant tribunal—

  (a) by a body subject to investigation by the Welsh Administration Ombudsman, or

  (b) with the consent (whether as to remuneration and other terms and conditions of service or otherwise) of such a body,

  shall be taken to be administrative functions of the body.
  (3) The Welsh Administration Ombudsman shall not conduct an investigation in respect of any action in respect of which the person aggrieved has or had—

  (a) a right of appeal, reference or review to or before a tribunal constituted under any enactment or by virtue of Her Majesty's prerogative, or

  (b) a remedy by way of proceedings in any court of law,

  unless the Welsh Administration Ombudsman is satisfied that, in the particular circumstances, it is not reasonable to expect the person aggrieved to resort or have resorted to it.
  (4) The Welsh Administration Ombudsman shall not conduct an investigation in respect of any action if the person aggrieved has or had the opportunity to make a complaint under a procedure operated
  1308
  by the body in the exercise of whose functions the action was taken unless he is satisfied—

  (a) that the procedure has been invoked and exhausted, or

  (b) that, in the particular circumstances, it is not reasonable to expect the procedure to be or have been invoked or exhausted.

  (5) The Welsh Administration Ombudsman shall not conduct an investigation in respect of—

  (a) action taken by or with the authority of a body for the purposes of investigating crime,

  (b) the commencement or conduct of any civil or criminal proceedings before any court of law in the United Kingdom,

  (c) action which could be investigated under the Health Service Commissioners Act 1993,

  (d) action taken by any member of the administrative staff of a relevant tribunal so far as taken at the direction, or on the authority (whether express or implied), of any person acting in his capacity as a member of the tribunal,

  (e) action taken in matters relating to contractual or other commercial transactions, other than compulsory land transactions, or

  (f) action taken in respect of appointments or removals, pay, discipline, superannuation or other personnel matters in relation to relevant service.

  (6) In sub-paragraph (5)—
  "compulsory land transactions" means transactions for or relating to—

  (a) the acquisition of land compulsorily or in circumstances in which it could be acquired compulsorily, or

  (b) the disposal as surplus of land acquired compulsorily or in such circumstances, and

  "relevant service" means service—

  (a) in any office or employment under the Crown or under any body subject to investigation by the Welsh Administration Ombudsman, or

  (b) in any office or employment, or under any contract for services, in respect of which power to take action, or to determine or approve the action to be taken, in personnel matters is vested in Her Majesty or any such body (or, in the case of a government department, any of its Ministers).

  (7) The Assembly may by order amend sub-paragraph (5) or (6) so as to exclude any actions or matters from the provisions of sub-paragraph (5).
  (8) In determining whether to initiate, continue or discontinue an investigation, the Welsh Administration Ombudsman shall (subject to the preceding provisions of this paragraph) act in accordance with his own discretion; but the Welsh Administration Ombudsman may not question the merits of a decision taken without maladministration in the exercise of a discretion.
  (9) In this paragraph "relevant tribunal" means a tribunal specified by order made by the Secretary of State; and references to a tribunal include the person constituting a tribunal consisting of one person.
  (10) References in this Schedule to "action" include failure to act (and related expressions shall be construed accordingly).
  Complaints
  17.—(1) A complaint may be made to the Welsh Administration Ombudsman by any individual or body of persons (whether or not incorporated) except—

  (a) the Assembly,

  (b) a local authority or other authority or body constituted for purposes of the public service or of local government,

  (c) a body constituted for the purposes of carrying on under national ownership an industry or undertaking or part of an industry or undertaking, and

  (d) any other authority or body whose members are appointed by Her Majesty, any Minister of the Crown or government department or the Assembly or whose revenues consist

  1309
  wholly or mainly of money provided by Parliament or the Assembly.

  (2) Subject to sub-paragraph (3), a complaint shall not be entertained by the Welsh Administration Ombudsman unless made by the person aggrieved himself.
  (3) Where the person by whom a complaint might have been made to the Welsh Administration Ombudsman has died, or is for any reason unable to act for himself, the complaint may be made by—

  (a) his personal representatives,

  (b) a member of his family, or

  (c) another individual, or any body, suitable to represent him.

  (4) A complaint to the Welsh Administration Ombudsman shall not be entertained unless it is made to him not later than twelve months after the day on which the person aggrieved first had notice of the matters alleged in the complaint; but the Welsh Administration Ombudsman may conduct an investigation pursuant to a complaint not made within that period if he considers that there are special circumstances which make it proper to do so.
  (5) A body subject to investigation by the Welsh Administration Ombudsman may itself refer to him a complaint made to the body about action taken by or on behalf of the body in the exercise of administrative functions of the body if the complaint was made—

  (a) in writing,

  (b) by a person who could have made a complaint to the Welsh Administration Ombudsman about the action, and

  (c) not more than twelve months after the day on which the person aggrieved first had notice of the matters alleged in the complaint or such later day as the Welsh Administration Ombudsman considers appropriate in any particular case.

  (6) But a body subject to investigation by the Welsh Administration Ombudsman may not refer a complaint under sub-paragraph (5) more than twelve months after the day on which the body received the complaint.
  (7) Any question whether a complaint is duly made or referred to the Welsh Administration Ombudsman shall be determined by him; but a complaint duly referred to him shall be deemed to be duly made to him.
  Investigation procedure
  18.—(1) Where the Welsh Administration Ombudsman proposes to conduct an investigation pursuant to a complaint made to him, he shall afford to—

  (a) the body concerned, and

  (b) any person who is alleged in the complaint to have taken or authorised the action complained of,

  an opportunity to comment on any allegations contained in the complaint.
  (2) The investigation shall be conducted in private but in other respects the procedure for conducting the investigation shall be such as the Welsh Administration Ombudsman considers appropriate in the circumstances of the case; and, in particular, the Welsh Administration Ombudsman—

  (a) may obtain information from such persons and in such manner, and make such inquiries, as he thinks fit, and

  (b) may determine whether any person may be represented, by counsel or solicitor or otherwise, in the investigation.

  (3) The Welsh Administration Ombudsman may, if he thinks fit, pay to the person by whom the complaint was made and to any other person who attends or supplies information for the purposes of an investigation—

  (a) sums in respect of expenses properly incurred by them, and

  (b) allowances by way of compensation for the loss of their time,

  in accordance with such scales, and subject to such conditions, as may be determined by the Welsh Administration Ombudsman.
  (4) The conduct of an investigation shall not affect—

  (a) any action taken, or

  (b) any power or duty to take further action with respect to any matters subject to the investigation.

  Evidence
  19.—(1) For the purposes of an investigation by the Welsh Administration Ombudsman he may require—

  (a) any member of, or any officer or member of the staff of, the body concerned, or

  (b) any other person who in his opinion is able to supply information or produce documents relevant to the investigation,

  to supply such information or produce such documents.
  (2) For the purposes of any such investigation the Welsh Administration Ombudsman shall have the same powers as the High Court in respect of—

  (a) the attendance and examination of witnesses (including the administration of oaths and affirmations and the examination of witnesses abroad), and

  (b) the production of documents.

  (3) No obligation to maintain secrecy or other restriction on the disclosure of information obtained by or supplied to persons in Her Majesty's service, whether imposed by any enactment or by any rule of law, shall apply to the disclosure of information for the purposes of an investigation by the Welsh Administration Ombudsman.
  (4) The Crown shall not be entitled in relation to any investigation by the Welsh Administration Ombudsman to any such privilege in respect of the production of documents or the giving of evidence as is allowed by law in legal proceedings.
  (5) Subject to sub-paragraph (4), no person shall be compelled for the purposes of an investigation by the Welsh Administration Ombudsman to give any evidence or produce any document which he could not be compelled to give or produce in civil proceedings before the High Court.
  Obstruction and contempt
  20.—(1) The Welsh Administration Ombudsman may certify an offence to the High Court where—

  (a) a person, without lawful excuse, obstructs him or any member of his staff in the performance of his functions, or

  (b) a person is guilty of any act or omission in relation to an investigation which, if that investigation were proceedings in the High Court, would constitute contempt of court.

  (2) Where an offence is so certified the High Court may inquire into the matter; and after hearing—

  (a) any witnesses who may be produced against or on behalf of the person charged with the offence, and

  (b) any statement that may be offered in defence,

  the High Court may deal with the person charged with the offence in any manner in which it could deal with him if he had committed the same offence in relation to the High Court.
  (3) Nothing in this paragraph shall be construed as applying to the taking of any such action as is mentioned in paragraph 18(4).
  Reports
  21.—(1) Where the Welsh Administration Ombudsman has conducted an investigation pursuant to a complaint made to him, he shall prepare a report of the results of the investigation and shall send copies of it to—

  (a) the person who made the complaint,

  (b) any Assembly member who, to the Welsh Administration Ombudsman's knowledge, assisted that person in making the complaint (or, if he is no longer an Assembly member, such Assembly member as the Welsh Administration Ombudsman thinks appropriate),

  (c) the body concerned,

  (d) any person who is alleged in the complaint to have taken or authorised the action complained of, and

  (e) the Assembly First Secretary.

  (2) Where the Welsh Administration Ombudsman decides not to conduct an investigation pursuant to a complaint made to him, he shall prepare a statement of his reasons for not conducting an investigation and shall send copies of it to—

  (a) the person who made the complaint, and

  (b) any Assembly member who, to the Welsh Administration Ombudsman's knowledge, assisted that person in making the complaint (or, if he is no longer an Assembly member, such Assembly member as the Welsh Administration Ombudsman thinks appropriate).

  Action in response to reports
  22.—(1) Where the Assembly First Secretary receives a copy of a report under paragraph 21(1) of the results of an investigation of any action taken in the exercise of a function, he shall send a copy of it to any Assembly Secretary who is accountable to the Assembly (in accordance with section 57) for the exercise of the Assembly's functions in any fields in which the function falls.
  (2) Where in a report under paragraph 21(1) the Welsh Administration Ombudsman states that injustice to the person aggrieved has been caused in consequence of maladministration, the body concerned shall consider the report and within—

  (a) the period of three months beginning with the date on which the body received the report, or

  (b) such longer period as the Welsh Administration Ombudsman may agree in writing,

  shall notify the Welsh Administration Ombudsman of the action taken or proposed to be taken.
  (3) The Welsh Administration Ombudsman shall prepare a further report if he—

  (a) does not receive the notification required by sub-paragraph (2) within the period allowed by or under that sub-paragraph,

  (b) is not satisfied with the action taken or proposed to be taken, or

  (c) does not within the period of three months beginning with the end of the period allowed by or under sub-paragraph (2), or such longer period as the Welsh Administration Ombudsman may agree in writing, receive confirmation from the body that action has been taken, as proposed, to his satisfaction.

  (4) The further report shall set out those facts and make such recommendations as the Welsh Administration Ombudsman thinks fit to make with respect to action which, in his opinion, should be taken—

  (a) to remedy the injustice to the person aggrieved, and

  (b) to prevent similar injustice being caused in the future;

  and a copy of the further report shall be sent to each of the persons to whom a copy of the report under paragraph 21(1) was sent.
  (5) Where the Assembly First Secretary receives a copy of a further report arising from an investigation of any action taken in the exercise of a function, he shall send a copy of it to any Assembly Secretary who is accountable to the Assembly (in accordance with section 57) for the exercise of the Assembly's functions in any fields in which the function falls.
  (6) Where the Assembly First Secretary receives a copy of a further report arising from an investigation of any action taken in the exercise of functions of the Assembly, he shall also—

  (a) lay a copy of it before the Assembly, and

  (b) (unless action to the satisfaction of the Welsh Administration Ombudsman has been taken or proposed) give to the Assembly notice of his intention to move that the Assembly resolve to approve the recommendations specified in it.

  (7) The standing orders must make provision for any motion of which notice has been given pursuant to sub-paragraph (6)(b) to be moved as soon as is reasonably practicable (unless action to the satisfaction of the Welsh Administration Ombudsman has been taken or proposed).
  Reports: supplementary
  23.—(1) Apart from identifying any body investigated, a report under paragraph 21(1), a further report under paragraph 22(3) or a report under paragraph 6 shall not—

  (a) mention the name of any person, or

  (b) include any particulars which, in the opinion of the Welsh Administration Ombudsman, are likely to identify any person and can be omitted without impairing the effectiveness of the report or further report,

  unless, after taking account of the public interest (as well as the interests of any person who made a complaint and other persons), the Welsh Administration Ombudsman considers it necessary for the report or further report to mention his name or include such particulars.
  (2) For the purposes of the law of defamation, the following are absolutely privileged—

  (a) the publication of any matter by the Welsh Administration Ombudsman in a report or statement under paragraph 21, a further report under paragraph 22(3) or a report under paragraph 6,

  (b) the publication of any matter in communications between—

  (i) an Assembly member or member of the Assembly's staff, a member of any other body subject to investigation by the Welsh Administration Ombudsman (or, in the case of a government department, any of its Ministers) or an officer or member of the staff of any such body, and

  (ii) the Welsh Administration Ombudsman or a member of his staff,

  in connection with an investigation by the Welsh Administration Ombudsman,

  (c) the publication of any matter in communications between any person and an Assembly member in connection with a complaint by the person to the Welsh Administration Ombudsman, and

  (d) the publication of any matter in communications between any person and the Welsh Administration Ombudsman or a member of his staff in connection with a complaint by the person to the Welsh Administration Ombudsman.

  Confidentiality of information
  24.—(1) Information obtained by the Welsh Administration Ombudsman or a member of his staff in the course of or for the purposes of an investigation shall not be disclosed except—

  (a) for the purposes of the investigation and of any report of it,

  (b) for the purposes of any proceedings for—

  (i) an offence under the Official Secrets Acts 1911 to 1989 alleged to have been committed in respect of information obtained by him or a member of his staff, or

  (ii) an offence of perjury alleged to have been committed in the course of an investigation by him,

  (c) for the purposes of an inquiry with a view to the taking of proceedings within paragraph (b),

  (d) for the purposes of any proceedings under paragraph 20, or

  (e) in accordance with paragraph 25.

  (2) Neither the Welsh Administration Ombudsman nor any members of his staff shall be called upon to give evidence in any proceedings (other than proceedings referred to in sub-paragraph (1)) of matters coming to his or their knowledge in the course of an investigation.
  (3) A Minister of the Crown may give notice in writing to the Welsh Administration Ombudsman with respect to—

  (a) any document or information specified in the notice, or

  (b) any class of document or information so specified,

  that in the opinion of the Minister the disclosure of that document or information, or of documents or information of that class, would be prejudicial to the safety of the State or otherwise contrary to the public interest.
  (4) Where such a notice is given neither the Welsh Administration Ombudsman nor any member of his staff shall be required or authorised to disclose to any person or for any purpose any document or information specified in the notice or any document or information of a class so specified.
  25.—(1) Sub-paragraph (2) applies where—

  (a) the Welsh Administration Ombudsman also holds office as the Parliamentary Commissioner for Administration or a Health Service Commissioner ("a Commissioner"), and

  (b) a person initiates a complaint to him in his capacity as a Commissioner which relates partly to a matter with respect to which that person has previously initiated, or subsequently initiates, a complaint to him as Welsh Administration Ombudsman.

  (2) Information obtained by the Welsh Administration Ombudsman or a member of his staff in the course of or for the purposes of investigating the complaint made to him in his capacity as Welsh Administration Ombudsman may be disclosed for the purposes of his carrying out his functions in relation to the other complaint.
  Consultation and co-operation with other Ombudsmen
  26.—(1) Where the Welsh Administration Ombudsman, at any stage in the course of conducting an investigation, forms the opinion that the complaint relates partly to a matter which could be the subject of an investigation—

  (a) by the Parliamentary Commissioner for Administration under the Parliamentary Commissioner Act 1967,

  (b) by a Health Service Commissioner under the Health Service Commissioners Act 1993, or

  (c) by a Local Commissioner under Part III of the Local Government Act 1974,

  he shall consult about the complaint with the appropriate Commissioner and, if he considers it necessary, he shall inform the person who made the complaint of the steps necessary to make a complaint to that Commissioner.
  (2) Where the Welsh Administration Ombudsman consults with a Commissioner in accordance with sub-paragraph (1), the consultations may extend to any matter relating to the complaint, including—

  (a) the conduct of any investigation pursuant to the complaint, and

  (b) the form, content and publication of any report of such an investigation.

  (3) Where a body subject to investigation by the Welsh Administration Ombudsman is also—

  (a) an authority to which the Parliamentary Commissioner Act 1967 applies,

  (b) a body subject to investigation by a Health Service Commissioner under the Health Service Commissioners Act 1993, or

  (c) an authority to which Part III of the Local Government Act 1974 applies,

  the Welsh Administration Ombudsman and the Parliamentary Commissioner for Administration, the Health Service Commissioner concerned or the Local Commissioner concerned shall co-operate with each other to any such extent as appears appropriate when exercising any function in relation to the body.
  (4) Nothing in paragraph 24(1) applies in relation to the disclosure of information in the course of consultations or other co-operation under this paragraph.").
  Before Schedule 8, insert the following new schedule—

SCHEDULE
AMENDMENTS OF HEALTH SERVICE COMMISSIONERS ACT 1993
1. The Health Service Commissioners Act 1993 has effect subject to the following amendments.
2. In section 1(3) (which introduces Schedule 1), for "the Commissioners and other administrative matters" substitute ", and other administrative matters relating to, the Health Service
1314
Commissioner for England and the Health Service Commissioner for Scotland; and Schedule 1A has effect with respect to the appointment and remuneration of, and other administrative matters relating to, the Health Service Commissioner for Wales".
3.—(1) Section 2 (bodies subject to investigation by Health Service Commissioners) is amended as follows.
(2) In subsection (2) (bodies subject to investigation by Health Service Commissioner for Wales), after paragraph (c) insert "and
(ca) the National Assembly for Wales ("the Assembly")."
(3) In subsection (5)(b) (Special Health Authorities which are subject to investigation by Health Service Commissioner), omit "by Order in Council".
(4) For subsection (6) (procedure for Order in Council) substitute—
"(6) A designation for the purposes of subsection (5)(b) shall be made—

(a) in the case of a Special Health Authority exercising functions only or mainly in Wales, by order made by the Assembly by statutory instrument, and

(b) in any other case, by Order in Council;

and a statutory instrument containing an Order in Council made by virtue of paragraph (b) shall be subject to annulment in pursuance of a resolution of either House of Parliament."
4. In section 2B (independent providers subject to investigation), after subsection (2) insert—
"(2A) Arrangements with the Assembly are not arrangements with a health service body for the purposes of this Act unless they are made in the exercise of a function of the Assembly relating to the National Health Service."
5. In section 3 (remit of Commissioners), after subsection (1) insert—
"(1YA) In the case of the Assembly the Health Service Commissioner for Wales may only conduct an investigation in respect of—

(a) a failure in a service provided by the Assembly in the exercise of a function of the Assembly relating to the National Health Service (an "Assembly health service function"),

(b) a failure of the Assembly to provide a service the provision of which is an Assembly health service function, or

(c) maladministration connected with any other action taken by or on behalf of the Assembly in the exercise of an Assembly health service function."

6. In section 7(1) (exception of action taken in respect of personnel matters), at the end insert "or service as a member of the staff of the Assembly."
7. In section 8(2) (authorities not entitled to make a complaint)—

(a) in paragraph (a), after "government" insert "(including the Assembly)", and

(b) in paragraph (c), after "department" insert "or by the Assembly" and after "Parliament" insert "or the Assembly".

8. In section 10 (referral of complaints by health service bodies), after subsection (2) insert—
"(2A) The Assembly may only refer a complaint under this section if it is in respect of a matter which the Health Service Commissioner for Wales can investigate by virtue of section 3(1YA)."
9. In section 11(4) (payment of expenses etc. by Commissioner)—

(a) after "Payments" insert "made by the Health Service Commissioner for England or the Health Service Commissioner for Scotland", and

(b) at the end insert "; and payments made by the Health Service Commissioner for Wales under this subsection shall be in accordance with such scales and subject to such conditions as may be determined by him."

10.—(1) Section 14 (reports by Commissioners) is amended as follows.
(2) For "a Commissioner" (in each place) substitute "the Health Service Commissioner for England or the Health Service Commissioner for Scotland".
(3) In subsection (4) (annual reports)—

(a) for "Each of the Commissioners" substitute "The Health Service Commissioner for England and the Health Service Commissioner for Scotland", and

(b) after "shall" and "may" insert "each".

(4) In the sidenote, after "by" insert "English and Scottish".
11. After that section insert—
"Reports by Welsh Commissioner.
14A.—(1) In any case where the Health Service Commissioner for Wales has conducted an investigation pursuant to a complaint under section 3(1), (1A) or (1C) he shall prepare a report of the results of the investigation and send copies of it—

(a) to the person who made the complaint,

(b) to any Assembly member who to the Commissioner's knowledge assisted in the making of the complaint (or, if he is no longer an Assembly member, to such Assembly member as the Commissioner thinks appropriate), and

(c) to the Assembly First Secretary.

(2) He shall also send a copy of the report—

(a) in the case of a complaint under section 3(1)—

(i) to the health service body who at the time of the report provides the service, or has the function, in relation to which the complaint was made, and

(ii) to any person who is alleged in the complaint to have taken or authorised the action complained of,

(b) in the case of a complaint under section 3(1A)—

(i) to any person by reference to whose action the complaint is made,

(ii) to the family health service provider (if he does not fall within sub-paragraph (i)). And

(iii) to any health service body with whom the family health service provider is subject to an undertaking to provide family health services, and

(c) in the case of a complaint under section 3(1C)—

(i) to any person who is alleged in the complaint to have taken or authorised the action complained of,

(ii) to the independent provider, and

(iii) to the health service body or family health service provider with whom the independent provider made the arrangement to provide the service concerned.

(3) In any case where the Health Service Commissioner for Wales decides not to conduct an investigation pursuant to a complaint under section 3(1), (1A) or (1C) he shall prepare a statement of his reasons for not conducting an investigation and shall send copies of it—

(a) to the person who made the complaint, and

(b) to any Assembly member who to the Commissioner's knowledge assisted in the making of the complaint (or, if he is no longer an Assembly member, to such Assembly member as the Commissioner thinks appropriate).

Action in response to reports by Welsh Commissioner.
14B.—(1) Where the Assembly First Secretary receives a copy of a report under section 14A(1), he shall send a copy of it to any Assembly Secretary who is accountable to the Assembly (in accordance with section 57 of the Government of Wales Act 1998) for the exercise of any functions of the Assembly relating to the National Health Service.
(2) Where in a report under section 14A(1) the Health Service Commissioner for Wales states that the person aggrieved has sustained such injustice or hardship as is mentioned in section 3(1), (1A) or (1C), any body or provider subject to the investigation shall consider the report and within—

(a) the period of three months beginning with the date on which the body or provider received the report, or

(b) such longer period as the Commissioner may agree in writing,

shall notify the Commissioner of the action taken or proposed to be taken.
(3) The Health Service Commissioner for Wales shall prepare a further report if he—

(a) does not receive the notification required by subsection (2) within the period allowed by or under that subsection,

(b) is not satisfied with the action taken or proposed to be taken, or

(c) does not within the period of three months beginning with the end of the period allowed by or under subsection (2), or such longer period as the Commissioner may agree in writing, receive confirmation from the body or provider that action has been taken, as proposed, to his satisfaction.

(4) The further report shall set out those facts and make such recommendations as the Health Service Commissioner for Wales thinks fit to make with respect to action which, in his opinion, should be taken—

(a) to remedy the injustice or hardship to the person aggrieved, and

(b) to prevent similar injustice or hardship being caused in the future;

and a copy of the further report shall be sent to each of the persons to whom a copy of the report under section 14A(1) was sent.
(5) Where the Assembly First Secretary receives a copy of a further report, he shall send a copy of it to any Assembly Secretary who is accountable to the Assembly (in accordance with section 57 of the Government of Wales Act 1998) for the exercise of any functions of the Assembly relating to the National Health Service.
(6) Where the Assembly First Secretary receives a copy of a further report arising from an investigation relating to the Assembly, he shall also—

(a) lay a copy of it before the Assembly, and

(b) (unless action to the satisfaction of the Health Service Commissioner for Wales has been taken or proposed) give to the Assembly notice of his intention to move that the Assembly resolve to approve the recommendations specified in it.

(7) The standing orders of the Assembly must make provision for any motion of which notice has been given pursuant to subsection (6)(b) to be moved as soon as is reasonably practicable (unless action to the satisfaction of the Health Service Commissioner for Wales has been taken or proposed).
Reports: supplementary.
14C.—(1) Apart from identifying any body or provider investigated, a report under section 14A(1), a further report under section 14B(3) or a report under paragraph 7 of Schedule 1A shall not—

(a) mention the name of any person, or

(b) include any particulars which, in the opinion of the Health Service Commissioner for Wales, are likely to identify any person and can be omitted without impairing the effectiveness of the report or further report,

unless, after taking account of the public interest (as well as the interests of any person who made a complaint and other persons), the Commissioner considers it necessary for the report or further report to mention his name or include such particulars.
(2) For the purposes of the law of defamation, the following are absolutely privileged—

(a) the publication of any matter by the Health Service Commissioner for Wales in a report or statement under section 14A, a further report under section 14B(3) or a report under paragraph 7 of Schedule
1A,

(b) the publication of any matter in communications between—

(i) an Assembly member or a member of the Assembly's staff or a member or an officer or member of the staff of any other body or provider subject to investigation by the Commissioner, and

(ii) the Commissioner or a member of his staff,

in connection with an investigation by the Commissioner,

(c) the publication of any matter in communications between any person and an Assembly member in connection with a complaint by the person to the Commissioner, and

(d) the publication of any matter in communications between any person and the Commissioner or a member of his staff in connection with a complaint by the person to the Commissioner."

12. In section 15(3) (interpretation of reference to a Commissioner's advisers), insert at the end "or paragraph 6(6) of Schedule 1A".
13. In section 17(1) (use of information by Commissioner in other capacity), after "Health Service Commissioner" insert ", the office of Welsh Administration Ombudsman".
14.—(1) Section 18 (consultation with other Commissioners) is amended as follows.
(2) In subsection (1) (duty to consult), after paragraph (b) insert—
"(ba) by the Welsh Administration Ombudsman under the Government of Wales Act 1998,",.
and after "Commissioner", in both places where it appears in the words following paragraph (d), insert "or the Ombudsman".
(3) In subsection (2) (matters which may be covered by consultation), after "another Commissioner" insert "or the Welsh Administration Ombudsman".
(4) In subsection (3) (confidentiality), omit "by a Commissioner or his officers".
15.—(1) Section 19 (interpretation) is amended as follows.
(2) After the definition of "allotted sum" insert—
""the Assembly" means the National Assembly for Wales;".
(3) In the definition of "officer", insert at the end "and, in the case of sthe Health Service Commissioner for Wales, any member of his staff;".
16.—(1) Schedule 1 (the Commissioners) is amended as follows.
(2) In the heading, before "COMMISSIONERS" insert "ENGLISH AND SCOTTISH".
(3) Before paragraph 1 insert—
"Introductory
A1. In this Schedule references to a Commissioner (or Health Service Commissioner) are to the Health Service Commissioner for England or the Health Service Commissioner for Scotland or to either of those Commissioners (as the context requires)."
(4) In paragraph 2(1) (acting Commissioners), for "Where any" substitute "Where either".
(5) In paragraphs 3(2)(a) and 3A(2)(a) (ineligibility of certain persons for appointment), omit "or for Wales".
(6) In paragraph 6 (salary of person holding more than one office)—

(a) in sub-paragraph (1)(b), for "one or more" substitute "either or both", and

(b) in sub-paragraph (2), for "two or more" substitute "both".

(7) Omit paragraph 11(2) (staff of Welsh Commissioner).
(8) In paragraph 12 (performance of functions of Commissioner by officers of another Commissioner), for "another Commissioner or the Parliamentary Commissioner" substitute "the other Commissioner, the Health Service Commissioner for Wales, the Parliamentary Commissioner or the Welsh Administration Ombudsman".
17. After that Schedule insert—
SECTION 1(3)

SCHEDULE
  SCHEDULE 1A

    THE WELSH COMMISSIONER
    Appointment
    1.—(1) The Health Service Commissioner for Wales shall be appointed by Her Majesty.
    (2) Subject to sub-paragraphs (3) and (4), the Health Service Commissioner for Wales shall hold office until the end of the year of service in which he attains the age of 65.
    (3) Her Majesty may relieve the Health Service Commissioner for Wales of office before the end of that year of service—

    (a) at his request, or

    (b) on Her Majesty being satisfied that he is incapable for medical reasons of performing the duties of his office and of requesting to be relieved of it.

    (4) Her Majesty may remove the Health Service Commissioner for Wales from office before the end of the year of service in which he attains the age of 65 if, on the ground of misbehaviour, the Secretary of State recommends that Her Majesty should do so; but the Secretary of State shall not so recommend without consulting the Assembly.
    Status
    2.—(1) The Health Service Commissioner for Wales shall be regarded as holding office under Her Majesty and as exercising his functions on behalf of the Crown.
    (2) Service as the Health Service Commissioner for Wales shall not be service in Her Majesty's Home Civil Service but he shall be taken to be a Crown servant for the purposes of the Official Secrets Act 1989.
    Appointment of acting Commissioner
    3.—(1) Where the office of Health Service Commissioner for Wales becomes vacant, Her Majesty may, at any time during the period of twelve months beginning with the date on which the vacancy arose, appoint a person to act as that Commissioner.
    (2) Subject to sub-paragraphs (3) to (5), an acting Health Service Commissioner for Wales shall hold office in accordance with the terms of his appointment.
    (3) An acting Health Service Commissioner for Wales shall not hold office after—

    (a) the appointment of a new Health Service Commissioner for Wales, or

    (b) the end of the period of twelve months beginning with the date on which the vacancy arose,

    whichever occurs first.
    (4) Her Majesty may at any time relieve an acting Health Service Commissioner for Wales of office—

    (a) at his request, or

    (b) on Her Majesty being satisfied that he is incapable for medical reasons of performing the duties of his office and of requesting to be relieved of it.

    (5) Her Majesty may remove an acting Health Service Commissioner for Wales from office at any time if, on the ground of misbehaviour, the Secretary of State recommends that Her Majesty should do so; but the Secretary of State shall not so recommend without consulting the Assembly.
    (6) A person appointed under this paragraph shall, while he holds office, be regarded for all purposes (except those of paragraph 1 and this paragraph) as the Health Service Commissioner for Wales.
    Ineligibility of certain persons for appointment
    4.—(1) A person who is a member of a body mentioned in section 2(1) or (2) shall not be appointed as Health Service Commissioner for Wales; and a person so appointed shall not, during his appointment, become a member of such a body.
    (2) A person mentioned in section 2A(1) or (2) shall not be appointed as Health Service Commissioner for Wales; and a person so appointed shall not, during his appointment, become a person so mentioned.
    Remuneration
    5.—(1) The Assembly shall—

    (a) pay the Health Service Commissioner for Wales such salary and any such allowances, and

    (b) make any such payments towards the provision of superannuation benefits for or in respect of him,

    as may be provided for by or under the terms of his appointment.
    (2) But where the Health Service Commissioner for Wales is also—

    (a) Parliamentary Commissioner, or

    (b) Welsh Administration Ombudsman,

    he shall not be entitled to any salary as Health Service Commissioner for Wales.
    (3) Where the Health Service Commissioner for Wales also holds either or both of the other offices of Health Service Commissioner, he shall be entitled only to the salary pertaining to such one of the offices of Health Service Commissioner as he selects.
    (4) The Assembly shall pay to or in respect of a person who has ceased to hold office as Health Service Commissioner for Wales such amounts (if any) by way of—

    (a) pension or gratuities, or

    (b) provision for those benefits,

    as may have been provided for by or under the terms of his appointment.
    (5) In Schedule 1 to the Superannuation Act 1972 (offices etc. to which section 1 of that Act applies), in the list of "Offices" insert—
    "Health Service Commissioner for Wales."
    (6) The Assembly shall pay to the Minister for the Civil Service, at such times as he may direct, such sums as he may determine in respect of any increase attributable to sub-paragraph (5) in the sums payable out of money provided by Parliament under the Superannuation Act 1972.
    Staff and advisers
    6.—(1) The Health Service Commissioner for Wales may appoint such staff as he considers necessary for assisting him in the exercise of his functions.
    (2) The Health Service Commissioner for Wales shall include among his staff such persons having a command of the Welsh language as he considers are needed to enable him to investigate complaints in Welsh.
    (3) Service as a member of the staff of the Health Service Commissioner for Wales shall be service in Her Majesty's Home Civil Service.
    (4) The Assembly shall pay to the Minister for the Civil Service, at such times as he may direct, such sums as he may determine in respect of any increase attributable to sub-paragraph (3) in the sums payable out of money provided by Parliament under the Superannuation Act 1972.
    (5) Any function of the Health Service Commissioner for Wales may be exercised by—

    (a) a member of his staff,

    (b) a member of the staff of the Welsh Administration Ombudsman, or

    (c) an officer of the Parliamentary Commissioner or of another Health Service Commissioner,

    if authorised by the Health Service Commissioner for Wales for that purpose; and references in any enactment to a member of the staff of the Health Service Commissioner for Wales include any person exercising any function of his by virtue of paragraph (b) or (c).
    (6) To assist him in the exercise of his functions the Health Service Commissioner for Wales may obtain advice from any person who, in his opinion, is qualified to give it.
    (7) The Health Service Commissioner for Wales may pay to any person from whom he obtains advice under sub-paragraph (6) any such fees or allowances as he may determine.
    (8) No arrangements shall be made—

    (a) for any of the functions of the Health Service Commissioner for Wales or of the Assembly to be exercised by the other or by a member of the other's staff, or

    (b) for the provision of any administrative, professional or technical services by the Health Service Commissioner for Wales or the Assembly for the other.

    Reports
    7.—(1) The Health Service Commissioner for Wales—

    (a) shall annually prepare and lay before the Assembly a general report on the performance of his functions, and

    (b) may from time to time prepare and lay before the Assembly such other reports with respect to his functions as he thinks fit.

    (2) The Assembly shall, and the Health Service Commissioner for Wales may, publish reports laid before the Assembly under this paragraph.
    Expenses
    8.—(1) The expenses of the Health Service Commissioner for Wales shall, so far as they cannot be met out of income received by him, be met by the Assembly.
    (2) Those expenses include any sums payable by the Health Service Commissioner for Wales in consequence of a breach, in the course of the performance of any of his functions, of any contractual or other duty (whether that breach occurs by reason of his act or omission or that of a member of his staff or any other person assisting him in the exercise of his functions).
    Estimates
    9.—(1) For each financial year of the Assembly after the first, the Health Service Commissioner for Wales shall prepare, and submit to the executive committee, an estimate of the income and expenses of his office.
    (2) Each such estimate shall be submitted to the executive committee at least five months before the beginning of the financial year to which it relates.
    (3) The executive committee shall examine each such estimate submitted to it and, after having done so, shall lay the estimate before the Assembly with any such modifications as the committee thinks fit.
    (4) Where the executive committee proposes to lay such an estimate before the Assembly with modifications, the committee shall first consult the Secretary of State and have regard to any advice which he may give.
    (5) In this paragraph "the executive committee" means the committee of the Assembly referred to as the executive committee in the Government of Wales Act 1998.
    Accounts
    10.—(1) The Health Service Commissioner for Wales shall keep proper accounting records.
    (2) The Health Service Commissioner for Wales shall, for each financial year of the Assembly, prepare accounts in accordance with directions given to him by the Treasury.
    (3) The directions which the Treasury may give under sub-paragraph (2) include, in particular, directions as to—

    (a) the information to be contained in the accounts and the manner in which it is to be presented,

    (b) the methods and principles in accordance with which the accounts are to be prepared, and

    (c) the additional information (if any) that is to accompany the accounts.

    Audit
    11.—(1) The accounts prepared by the Health Service Commissioner for Wales for any financial year of the Assembly shall be submitted by him to the Auditor General for Wales no later than five months after the end of that financial year.
    (2) The Auditor General for Wales shall—

    (a) examine and certify any accounts submitted to him under this paragraph, and

    (b) no later than four months after the accounts are submitted to him, lay before the Assembly a copy of them as certified by him together with his report on them.

    (3) In examining any accounts submitted to him under this paragraph, the Auditor General for Wales shall, in particular, satisfy himself that the expenditure to which the accounts relate has been incurred lawfully and in accordance with the authority which governs it.
    Accounting officer
    12.—(1) The accounting officer for the Office of the Health Service Commissioner for Wales shall be the Health Service Commissioner for Wales.
    (2) But where—

    (a) the Health Service Commissioner for Wales is incapable of discharging his responsibilities as accounting officer, or

    (b) the office of Health Service Commissioner for Wales is vacant (and there is no acting Health Service Commissioner for Wales),

    the Treasury may designate a member of the staff of the Health Service Commissioner for Wales to be the accounting officer for so long as paragraph (a) or (b) applies.
    (3) The accounting officer for the Office of the Health Service Commissioner for Wales shall have, in relation to the accounts of the Health Service Commissioner for Wales and the finances of the Office of the Health Service Commissioner for Wales, the responsibilities which are from time to time specified by the Treasury.
    (4) In this paragraph references to responsibilities include in particular—

    (a) responsibilities in relation to the signing of accounts,

    (b) responsibilities for the propriety and regularity of the finances of the Office of the Health Service Commissioner for Wales, and

    (c) responsibilities for the economy, efficiency and effectiveness with which the resources of the Office of the Health Service Commissioner for Wales are used.

    (5) The responsibilities which may be specified under this paragraph include responsibilities owed to—

    (a) the Assembly, the executive committee or the Audit Committee of the Assembly, or

    (b) the House of Commons or its Committee of Public Accounts.

    (6) If requested to do so by the House of Commons Committee of Public Accounts, the Audit Committee of the Assembly may—

    (a) on behalf of the Committee of Public Accounts take evidence from the accounting officer for the Office of the Health Service Commissioner for Wales, and

    (b) report to the Committee of Public Accounts and transmit to that Committee any evidence so taken.

    (7) In this paragraph and paragraphs 13 and 14 "the Office of the Health Service Commissioner for Wales" means the Health Service Commissioner for Wales and the members of his staff; and in this paragraph "the executive committee" has the same meaning as in paragraph 9.
    Examinations into use of resources
    13.—(1) The Auditor General for Wales may carry out examinations into the economy, efficiency and effectiveness with which the Health Service Commissioner for Wales has used the resources of the Office of the Health Service Commissioner for Wales in discharging his functions.
    (2) Sub-paragraph (1) shall not be construed as entitling the Auditor General for Wales to question the merits of the policy objectives of the Health Service Commissioner for Wales.
    (3) In determining how to exercise his functions under this paragraph, the Auditor General for Wales shall take into account the views of the Audit Committee of the Assembly as to the examinations which he should carry out under this paragraph.
    (4) The Auditor General for Wales may lay before the Assembly a report of the results of any examination carried out by him under this paragraph.
    (5) The Auditor General for Wales and the Comptroller and Auditor General may co-operate with, and give assistance to, each other in connection with the carrying out of examinations in respect of the Health Service Commissioner for Wales under this paragraph or section 7 of the National Audit Act 1983 (economy etc. examinations).
    Examinations by the Comptroller and Auditor General
    14.—(1) For the purpose of enabling him to carry out examinations into, and report to Parliament on, the finances of the Office of the Health Service Commissioner for Wales, the Comptroller and Auditor General—

    (a) shall have a right of access at all reasonable times to all such documents in the custody or under the control of the Health Service Commissioner for Wales, or of the Auditor General for Wales, as he may reasonably require for that purpose, and

    (b) shall be entitled to require from any person holding or accountable for any of those documents any assistance, information or explanation which he reasonably thinks necessary for that purpose.

    (2) The Comptroller and Auditor General shall—

    (a) consult the Auditor General for Wales, and

    (b) take into account any relevant work done or being done by the Auditor General for Wales,

    before he acts in reliance on sub-paragraph (1) or carries out an examination in respect of the Health Service Commissioner for Wales under section 7 of the National Audit Act 1983 (economy etc. examinations)."").
    The noble Lord said: I beg to move.
    Lord Roberts of Conwy: I confirm the unqualified welcome for the proposal to establish a Welsh Administration Ombudsman and the consequential changes in relation to the Health Service Commissioner. I particularly welcome the fact that the Welsh Administration Ombudsman is not confined to the assembly and its executive. He can examine complaints of maladministration by related bodies, including the new Welsh Development Agency and other bodies receiving a significant proportion of their funding from assembly sources. The possibility that they may be complained against should help keep those bodies on the straight and narrow track of propriety.
    1324
    I also give a hearty welcome to the novel proposals for a response procedure, when the Welsh Administration Ombudsman has investigated a complaint and found maladministration. The body responsible would be given three months in which to respond. If it fails to do so, or if its response is unsatisfactory, the WAO will issue a further report setting out the action required. If the assembly is the guilty party, the first secretary will be required to move that the assembly approve the WAO's recommendations as to the form of redress.
    I hope that it will be quickly established that such motions are normally carried in the assembly. There was a striking contrast between the acceptance by the Welsh Office of parliamentary commissioners' decisions and the grudging refusal of many local authorities to accept the findings of the local government commissioner. If the procedure whereby the first secretary has to move acceptance of the WAO's recommendations prove successful in practice, I hope that a similar procedure will be made obligatory on local authorities.
    Lord Williams of Mostyn: I thank the noble Lord for his typically generous remarks. It is an enormous improvement. The noble and learned Lord, Lord Simon of Glaisdale, is not here. These amendments have come about because we have listened carefully. I entirely agree with the noble Lord that an in-built structural mechanism is a very useful discipline for government at whatever level.
    On Question, amendments agreed to.
    Schedule 8 [Relations with local government: supplementary]:
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 246A:
    Page 97, line 39, after ("election") insert ("(after the first)").
    The noble Lord said: Within this group are Amendments Nos. 246A and 246B together with Amendment No. 247. Amendments Nos. 246A and 246B are technical. The assembly will have to consider changes to its schemes for local government and the voluntary sector in the year following the ordinary elections to the assembly. The amendments are designed to give a degree of flexibility which we thought, on reflection, was more appropriate.
    At present, paragraph 6 to Schedule 8 and subsection (5) of Clause 114 would oblige the assembly to consider changing its local government and voluntary sector schemes by May 2000. We have thought about this. The assembly does not come into being until the end of May next year and its early life will be dominated by organising delivery not only of duties placed by the legislation but also the transfer of functions. That will mean that in the first year of the assembly's being the statutory schemes will not have had full 12-month terms. It is sensible not to insist that the assembly should consider whether to change the local government and voluntary sector schemes within the year following the first ordinary elections. We will propose an identical amendment for the sustainable development scheme which the assembly will prepare under Clause 121.
    Amendment No. 247 does not allow the assembly to delegate its function for making or revising its scheme with the voluntary sector. This ensures consistency of treatment for the voluntary sector with the other schemes that the assembly will make for local government and sustainable development, where the functions again cannot be delegated. I beg to move.
    Lord Mackay of Ardbrecknish: I think I understand these two amendments. They are quite sensible. The noble Lord did not say much about Amendment No. 247. I take it that the Government have had second thoughts about any of this being delegated. Amendment No. 247 prevents delegation. It seems to be a little prescriptive, but there is merit in it.
    On page 58 of the Bill, subsection (5) says:
    "The Assembly shall keep the scheme under review and in the year following each ordinary election …".
    I take it that an ordinary election is not the first one. The first election is an extraordinary election. If it is not, then perhaps the Government will need another amendment at Report stage to clear that up.
    What the noble Lord has done is quite sensible. Dare I say that it shows the merits of a second Chamber?
    On Question, amendment agreed to.
    Schedule 8, as amended, agreed to.
    Clause 114 [Relations with voluntary organisations]:
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendments Nos. 246B and 247:
    Page 58, line 11, after ("election") insert ("(after the first)").
    Page 58, line 14, leave out from ("scheme") to end of line 16.
    On Question, amendments agreed to.
    4 p.m.
    On Question, Whether Clause 114, as amended, shall be agreed to?
    Lord Aberdare: I am in the rather awkward position of opposing that this clause should stand part when in fact I very much welcome it. I shall be horrified if it is not a part of the Bill. It is the only part that mentions voluntary bodies. The only way to get further information from the Government was to table this kind of probing amendment.
    I must declare an interest. I am the president of the National Council of YMCAs in Wales.
    When I first became interested in this I wanted to find out some of the statistics about the grants that are made to voluntary bodies. The best information that I could get was in a letter from Win Griffiths, Parliamentary Under-Secretary of State at the Welsh Office, to Denzil Davies, MP, on 14th April 1998. This disclosed that the total grants to voluntary bodies by the Welsh Office in the year 1996–97 were over £15 million. This was distributed to 285 different voluntary bodies up and down Wales—north, south, east and west—and, varied in amounts from more than £1 million to the Welsh Books Council to £300 to Ambleston Hall, and there were many grants in between. They arose from various statutes but they are all of great importance to the recipients.
    1326
    I welcome the scheme envisaged in the clause. It is the main provision of Clause 114. It will form the basis of what comes before the assembly in due course when it takes over the responsibilities from the Secretary of State. It is of great importance to all voluntary bodies in Wales. They all welcome the idea of close co-operation with the assembly. I would ask the noble Lord if he can give more information about the status and timetable of the scheme.
    The Wales Council for Voluntary Action, which has a membership of 600 from various organisations, is keen on the scheme and is working hard to produce a draft agreement. However, I should be grateful if the Minister could give us any information about the progress of the scheme, in particular whether it is likely to be published before the Bill leaves this House.
    I wish to mention a particular grant scheme which exists under the Headquarter Grants Education Order 1990 to assist the central administration of voluntary bodies in the youth service area. I understand that in Wales it has an annual budget of £361,000, administered by the Wales Youth Agency. Of that, the YMCA received £45,000 this year, the first of a three-year programme. I hope that whatever happens in the future, the new assembly will accept that commitment for the two remaining years because it is of enormous importance to the YMCA. The same applies to other bodies with an on-going programme.
    I turn to the future of the youth service in Wales. I should not like it to be thought that the YMCA considered itself to be the only voluntary body. There are many others and all carry out extremely good work. There are, for instance, the Urdd Gobaith Cymru, which is the Welsh voluntary body, the Welsh Association of Youth Clubs, the Duke of Edinburgh Award Scheme, the Federation of Girls' and Boys' Clubs, the Scouts, the Guides, the young farmers' clubs and various Church bodies. Perhaps I may quote from a document produced by the Wales Youth Agency, Building the Future, to illustrate the importance of the youth service in Wales. It states:
    "In Wales over ¼million young people are in contact with a range of youth work organisations on a regular basis. Young people find youth work attractive and value the opportunities it provides. Youth work is a partnership between voluntary youth organisations and local authority organisations. It offers opportunities to find challenge and adventure, advice, information and counselling, recognition of achievement and enjoyment. Unitary authorities have a statutory duty to ensure the quality of their youth service".
    The YMCA is at the sharp end of this work, dealing with some of the major problems of young people, including homelessness, unemployment and drug and alcohol abuse, as well as providing social and sporting activities. On any one night, for example, the YMCA provides emergency accommodation in its hostels for 177 young people, 140 of them in Cardiff alone.
    Yet since the unitary authorities took over we have lost two full-time and four part-time staff as a result of the withdrawal of grant aid. I know that other youth organisations are in a similar predicament. The Urdd is suffering from reduced funding for its area officers and is also being charged for the premises in which its members meet. The Guides are also paying more for hiring their meeting places.

    1327
    In the Welsh Office Green Paper, Learning is for Everyone, Chapter 2 refers to the importance of the youth service. Paragraph 23 states:
    "The Youth Service and associated voluntary sector organisations are critically important in the drive towards a learning country".
    However, its proposals to implement these good intentions are limited to exhortations; for example, clarifying the duty of local authorities to secure a youth service, extending that duty to require local authorities to collaborate with the voluntary sector youth services and so forth. There is no commitment to extra funding, except for a grant of £300,000 to the Wales Youth Agency.
    The Government have made education one of their main priorities and have allocated extra funds to local authorities for that purpose. That purpose should include the youth service. However, it is not clear that the extra funding is always used by local authorities for educational purposes, including the youth service.
    The Bill, in subsection (4)(a), refers to:
    "how the Assembly proposes to provide assistance to relevant voluntary organisations (whether by grants, loans, guarantees or any other means)".
    Does that mean that assembly funding will be available to the voluntary bodies involved in the youth service? If so, how does it fit in with the local authorities' statutory duty to provide a youth service? The two appear to overlap.
    I cannot help wondering where the assembly is to find much of the money that is required for the youth service. We often hear quoted the figure of £7 billion coming from the Welsh Office when the responsibilities of the Secretary of State are transferred to the assembly. But, unfortunately, that includes financing many demanding commitments; for instance, local authorities and health authorities as well as the cost of establishing and running the assembly itself, including the salaries and expenses of its members. The debate last week on the financial arrangements and the Barnett formula did not suggest that the assembly was likely to have much spare cash.
    I am not very sanguine about the future of the youth service. I hope that the Minister will be able to give us some encouragement. I conclude with a Welsh saying:
    "Ni wna geiriau teg hau'r tir".
    It means, "Fair words will not sow the land", or, more colloquially, "Fair words butter no parsnips". I hope that the noble Lord will be able to give us a bit of butter.
    Lord Hooson: The purpose of my intervention is simply to ask a question. Is it intended that the national assembly advisory committee or the Welsh Office should draw up a moral scheme for consideration by the assembly? It would be reassuring for those who are concerned about the relationship with voluntary organisations. The assembly can amend the scheme as it wishes, but it would be helpful if there were an intention to take one of those two courses.
    Lord Elis-Thomas: I am grateful to the noble Lord, Lord Aberdare, for giving us an opportunity to debate
    1328
    briefly the issue of partnership with the voluntary sector. I declare an interest in that the Welsh Language Board, which I chair, has a formal funding partnership with a number of voluntary organisations, including the Wales Council for Voluntary Action.
    The national assembly will have a key role in the funding and debating of priorities within the voluntary sector, both directly and indirectly. There is an opportunity for a new strategic partnership not only in the youth service, to which the noble Lord has referred, but in the whole area of social and environmental policy which has such an active voluntary sector in Wales. It is estimated that if the 23,000-plus voluntary organisations were active at the same time one in three of the population would be involved in the voluntary sector in Wales. There is a wealth of experience and good will which must be mobilised in partnership with the assembly in order to create a new kind of society in the context of which we will operate in the 21st century.
    Already the voluntary sector exhibits that inclusivity and participation of which my right honourable friend the Secretary of State, Ron Davies, speaks so often. I sincerely hope that the Government will take on board the suggestion made by the noble Lord, Lord Hooson. Already compacts are developing between government and the voluntary sector throughout the UK.
    I assume that any preparatory relationship or scheme between the voluntary sector and the assembly would be on the lines of the compacts already being drafted for all four nations of the UK, recognising the role of the voluntary sector, the key policy statements of voluntary organisations, the need for volunteering and the whole area of community development and, equally important, the whole procedure for partnership and representation, particularly representation in relation to funding decisions.
    Here, I declare myself to be on a learning curve, because it is not easy for a public body, when dealing with voluntary organisations, to understand the nature of that organisation's culture. Very often it is possible for a public body to have certain priorities which may be strategically sound and which may have key functional objectives, but they are not well understood by voluntary organisations. It is particularly important that the assembly approaches the voluntary sector in a way different from its approach to local government, to the health service, as we have already heard, and to other partnership organisations which have a statutory basis.
    For that reason, there is much merit in the WCVA's suggestion of a joint liaison committee, not that we want to create too many committees. However, there is a case for such a committee to advise the assembly and members of the voluntary sector and to oversee the working of the voluntary sector scheme.
    Also, I am attracted by the proposal that there should be a support centre for the activity of the voluntary sector, providing information and support within the assembly building itself or close to it. I understand that the WCVA has made an offer on behalf of the sector to seek the funding for the operation of such a facility.

    1329
    There needs to be space for it so that there can be a close relationship between the voluntary sector and the assembly in practice.
    The Earl of Courtown: Like my noble friend Lord Aberdare, I welcome this clause but there are one or two points which concern me which I should like the Minister to clarify. I should also declare an interest as a trustee of a chronic pain charity which is based in South Wales.
    My main concern is that voluntary fund-raisers are already complying with many rules and regulations as to how they work. Although I accept that there is a need for such regulation, it is now becoming excessive in places and it irritates many hard-working and dedicated fund-raisers who, quite understandably, do not like to be told to fill in more forms and comply with more regulations. Therefore, I am anxious that the assembly will not increase needless bureaucracy.
    Finally, will the Minister tell me whether the assembly will be able to alter or change in any way anything concerning the relationship between charities and the Charity Commission? If so, what and how? I suspect that primary legislation would be required, but I should be grateful to the Minister if he would clarify the point.
    Lord Stanley or Alderley: I have my name to this Motion for the same reason as my noble friend Lord Aberdare; that is, to try to find out what the Government have in mind with regard to the assembly's role in relation to voluntary organisations.
    As my noble friends Lord Aberdare and Lord Courtown have explained the possible problems, I shall emphasise only one particular point. Will the assembly have the power to make rules and regulations for those voluntary organisations which are not dependent in any way whatever on state money or aid? I am thinking of, for example, the RNLI which is supported entirely by voluntary money and help.
    Perhaps I may repeat what my noble friend Lord Courtown has just said. I accept now and I accepted during the passage of charities legislation that charities, particularly with regard to their money, need careful supervision. But on behalf of those many selfless and dedicated men and women—I call them slaves—who put in their time for nothing, I ask for an assurance from the Minister that the assembly will not add any bureaucracy to irritate them because, as the Committee will know, I do not trust politicians, assembly members or councillors not to be tempted to do so.
    4.15 p.m.
    Lord Prys-Davies: Whatever the scale of the statutory provisions and whatever the market can provide, I am sure that in Wales we cannot go along without the voluntary contribution. Therefore, I am extremely grateful that the noble Lord, Lord Aberdare, has given us an opportunity to discuss this clause, a clause which gives me a great deal of satisfaction.
    Reference has been made to the scheme and I should like to ask two or three specific questions about it. First, it is my understanding—and this picks up a point made
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    by my noble friend Lord Hooson—that the proposed scheme will to a greater extent be based on the draft voluntary sector compact, which, as I understand it, is currently out for consultation. Perhaps the Minister will confirm that.
    Secondly, I am told by many people who are engaged with the voluntary sector in Wales that the relationships between the voluntary bodies and the assembly are not the only relationships which will matter. They tell me that the relationships between the voluntary bodies and the assembly and also local authorities will matter a great deal. That is because—and I believe the noble Lord, Lord Aberdare, suggested that that is the case—in Wales, compared with England, there are very few financial resources available to the voluntary organisations, apart from local and central government.
    Therefore, it is important to foster the relationship between the assembly, the local authorities and the voluntary organisations. But I am not sure that that can be achieved in the proposed scheme. Perhaps the Minister will comment on that.
    Secondly, the permanent voluntary services unit is not without its critics. But I believe that there should be a group of inter-departmental senior officials within the Welsh assembly, possibly with an assembly secretary in the chair, to consider the relevance of voluntary activities across the frontiers of all the departments of the assembly. I ask the Minister whether that can be addressed in the scheme.
    Perhaps I may refer next to the report of Lord Wolfenden on the future of voluntary organisations which was published in 1978. The committee envisaged that in the event of a Welsh assembly being established, there would be an increasing role for a central body representing the across-the-board interest of voluntary organisations in Wales to give a lead in providing advice and information. I believe that that recommendation is still valid and should be taken on board by the voluntary organisations in Wales.
    Finally, reference was made to the charity commissioners. I have great respect for the charity commissioners and I have found them to be extremely helpful. But the day may well come when in Wales we shall need a Welsh office of the Charity Commissioners so that we do not have to look to Liverpool, Taunton or London. With those few remarks, I endorse very much what has been said by the noble Lords, Lord Aberdare and Lord Stanley.
    Lord Roberts of Conwy: Like other Members of the Committee, I, too, have received a letter dated 21st May, which is very supportive of the clause from the Wales Council for Voluntary Action. In addition to the 600 organisations that the council represents in Wales, it states in the letter that it is in contact with a great many more. I know that organisation and I have no reason to doubt its claims.
    The WCVA has very high expectations of the assembly and of the anticipated scheme. It states in the letter that there is a draft compact arising out of the Labour Party's election manifesto commitments, which is already available for consultation in Wales and

    1331
    elsewhere. The Welsh compact sets out how the Government will work with the voluntary sector. It covers recognition of the respective roles of the voluntary sector and government, key policy statements on voluntary organisations, procedures for representation, partnership working and funding administration.
    Therefore, the council says:
    "The Compact will … provide a framework of mutual expectations and commitments upon which the Assembly will be able to base its working arrangements with the voluntary sector".
    The same letter from Peter Bryant, who is head of policy for the WCVA, goes on to argue the need for a joint body to which the noble Lord, Lord Elis-Thomas, referred—that is, a joint body between the assembly and the voluntary sector. The letter states quite clearly:
    "It is proposed that there should be a joint liaison committee, made up of members of the Assembly and elected representatives of the sector, to oversee the implementation and working of the Voluntary Sector Scheme".
    It also states that the liaison committee should report to the assembly's executive committee and to that of the WCVA. So the WCVA is very clear about what it wants from this particular clause.
    Indeed, the letter finally proposes that,
    "a voluntary sector information and support centre should be established within the Assembly building".
    I pause for breath here because I wonder whether all these aspirations have been taken into account. I certainly hope that they were not just referendum-time promises, which were made to the voluntary sector simply to harvest a "Yes" vote. If such promises were made but not honoured, I have no doubt that there would be very deep disappointment throughout the sector.
    However, while I wish the implementation of the clause well, I believe that someone should utter a word of caution to the voluntary sector and its representatives in Wales that it must safeguard its independence. Welcome as government support in financial and organisational terms may be, surely the strength of the sector lies in its independence and in its voluntary basis and spirit, which must on no account be compromised. As Mr. Bryant states on page one of the letter to which I referred,
    "The Assembly will … Determine policy and priorities in the majority of areas of concern to the voluntary sector; control, directly or indirectly, most of the public funding for the sector; oversee or influence the activities of most of the agencies with which the sector works".
    and so on. That seems to me to spell out an enormous amount of influence on the voluntary sector. I hope that both parties—that is, the assembly and the voluntary sector—are aware of the potential fragility of their relationship and that they respect each other's independence as well as perhaps the dependence of the voluntary sector. It would be fatal to the voluntary sector if it found itself excessively controlled and directed by the public sector only to have its voluntarism exploited for uncertain ends.
    Lord Williams of Mostyn: I am most grateful to Members of the Committee who have spoken, not least
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    the noble Lord, Lord Aberdare, who raised the question some months ago in this Chamber as to what place there would be in the Government of Wales Bill for the voluntary sector. I remember indicating to him that Clause 114 was likely to deal with that area.
    The thrust of what has been said by all noble Lords, is, I hope, entirely consistent with what has been set out in Clause 114. The noble Lord, Lord Aberdare, asked for a little more precision as regards dates and timing, which I shall now outline. The Secretary of State for Wales is formulating with the WCVA, and other representatives of the voluntary sector in Wales, a compact setting out the future relationship with the voluntary sector. The consultation exercise was launched on 6th March and will run until 10th July.
    The noble Lord, Lord Aberdare, asked if I could give an indication as to whether or not the conclusions will have been published by the time of Third Reading. All I can say at present is that discussions are going extremely well, as I am sure the noble Lord knows. It is hoped to reach final agreement later this summer. I do not know the date of Third Reading, but I believe that it would be reasonable for me to undertake to write to the noble Lord shortly before Third Reading, placing a copy of the letter in the Library, giving as much detail as I shall then have. It may not contain definitive conclusions, but at least I shall be able to recite the story so far. I undertake to do so.
    Other specific questions were raised. The noble Earl, Lord Courtown, posed two important questions. First, it is very important that the dead hand of bureaucracy—and that is an awful mixed metaphor—does not extend its reach. I say that because, if it were dead, it could not do so by definition. I take that point on board. I was formerly a trustee of the NSPCC and I recognise that there is sometimes irritation, especially where money is being donated by members of the public. They are entitled to have it scrupulously dealt with. There is nothing more of a disincentive to voluntary giving than the fear, sometimes unfortunately justified, that money is being used for illegitimate purposes in the running of an organisation in a way that is not as prudent as it should be.
    Two noble Lords referred to the Charity Commission. There is no prospect of the Welsh assembly being able to interfere with the statute which relates to the Charity Commission. It is not a Welsh Office function. Indeed, I must place another hat on my fevered brow because it is a Home Office function. As regards the specific question from the noble Lord, Lord Stanley of Alderley, as to whether or not the Welsh assembly would be able to impose rules and regulations on such bodies as the RNLI which are in receipt of no public money, it does not seem to me that that would fall within the remit of the assembly. However, as charities, they would be subject to the usual remit of the Charity Commission.
    Other specific questions were raised about how the compact would work. The noble Lord, Lord Hooson, and my noble friend Lord Prys-Davies, asked whether or not this would be a template. It would certainly be a pretty clear indication of what discussions had indicated was likely to be useful. Ultimately it will be for the

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    assembly to decide. However, bearing in mind the nature of the consultation, which is very widespread, one would assume that the assembly would pay close regard to the compact which had been negotiated even if it could not literally be bound by its terms.
    My noble friend Lord Prys-Davies spoke about voluntary bodies which have a connection with local authorities. Indeed, that is certainly the case with the NSPCC in various different ways. That would not be included in the scheme because the assembly cannot bind local authorities in their relationships with charitable bodies. However, there is no reason at all why they should not consult. I very much take on board the points made by my noble friend. All of his points relating to relations between local government and voluntary bodies and whether there should be a joint working group seem to me to be ideas for development by the assembly.
    On the question of a compact, I think it was the noble Lord, Lord Elis-Thomas, who referred to other work. He is quite right. There is parallel work along the same lines by Secretaries of State in other parts of the United Kingdom who have responsibility for voluntary sector matters. We gave a commitment in the White Paper that the compact would be in place. The purpose of Clause 114 is to require the assembly to draw up a scheme to cover the same kind of subject matter. I assure the Committee that before Clause 114 was drafted there was consultation between the Welsh Office and the WCVA at official level. The provision has been given a warm reception by the voluntary sector.
    The noble Lord, Lord Aberdare, asked about funding. One finds the answer in part in Clause 114(4) which states,
    "The scheme shall specify—
    how the Assembly proposes to provide assistance to relevant voluntary organisations (whether by grants, loans, guarantees or any other means)".
    I take the noble Lord's point that that will be subject to the assembly's discretion within the overall budget of £7 billion or so.
    I believe that we have behaved properly and honourably towards the voluntary sector. We consulted it about the proposals for the compact. We consulted it about the precise drafting of Clause 114. On that basis of co-operative endeavour I invite the Committee to come to the conclusion in due time that this clause should stand part of the Bill. I recognise that the noble Lord raised legitimate questions. In many ways Clause 114 is the noble Lord's progeny, at least in part.
    Clause 114 agreed to.
    4.30 p.m.
    Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 247ZA:
    After Clause 114, insert the following new clause—
    CONSULTATION WITH BUSINESS AND VOLUNTARY ORGANISATIONS
    (" . The Assembly shall carry out consultation with representatives of business, representatives of voluntary organisations and the Partnership Council, having regard to the impact of the exercise by the Assembly of its functions on their respective interests.").
    The noble Lord said: This group of amendments relates to Clause 115 and concerns the consultation which representatives of business will have with the assembly. Clause 115 of the Bill states,
    "The Assembly shall carry out such consultation with representatives of business as it considers appropriate".
    My noble friend and I have tabled amendments to try to strengthen that provision. However, our preferred position is stated in Amendment No. 247ZA which seeks to rewrite Clause 115 and to put in its place our proposed new clause. I believe that the provisions in our proposed new clause are a good deal stronger than those in Clause 115. Our proposed new clause acknowledges the voluntary organisations and asks for consultation with them. It also acknowledges the existence of the partnership council and asks for consultation with it as regards any issue which has an impact on the functions of these bodies. We simply state in the amendment that,
    "The Assembly shall carry out consultation",
    with regard to all the organisations I have mentioned. We do not state that the assembly shall carry out consultation as it considers appropriate. This is particularly important as regards manufacturing industry. If the Government do not like voluntary organisations and the partnership council being included in the clause, our other amendments in the group I am discussing would simply amend Clause 115 to make it state,
    "The Assembly shall carry out consultation with representatives of business having regard to the impact".
    We should not leave it to the assembly to decide whether it is appropriate to consult.
    Over the past 19 years, Wales, like some other parts of the United Kingdom, has seen considerable change in its industrial base. It still has steelworks at Llanwern and Port Talbot, although perhaps I should not say that too loudly in Scotland. It has seen a huge growth in its electronics industry, its electronics components industry and its car industry. These new industries are just as important now as was the traditional mining industry in the past. Therefore it is important that businesses are consulted by the assembly. I have no doubt the Minister will tell me that the wording in the Bill,
    "The Assembly shall carry out such consultation with representatives of business as it considers appropriate",
    means that the assembly will consult widely and on everything. Ministers always say that when we discuss this kind of amendment. The Opposition have every right not to believe Ministers. That is the name of the game, so to speak. If the assembly intends to consult widely and in virtually every case, why is that not on the face of the Bill, and why not delete the words in the Bill, "as it considers appropriate"?
    I wish to discuss Amendment No. 247A in the name of the noble Lord, Lord Elis-Thomas, as it covers the same ground. However, he goes a good deal further than my proposed new clause in Amendment No. 247ZA. The noble Lord, Lord Elis-Thomas, in his amendment specifies a considerable number of businesses and organisations. As I said, the noble Lord, Lord Elis-Thomas, and I are covering the same ground here. We want to see a little more in Clause 115 than three

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    lines of text to cover the relationship between business and the assembly. Clause 114 is lengthy and is devoted to voluntary organisations. Clause 113, which is also fairly lengthy, is devoted to relations with local government. I believe that Clause 115 should be more detailed. If it must be brief, its content should be a good deal stronger than it is. My proposed new clause proposes a way of strengthening the measure. If the Government do not want to go that far, the two amendments to Clause 115 in my name, and that of my noble friend Lord Roberts of Conwy, suggest how the measure could be strengthened a little more. I beg to move.
    Lord Thomas of Gresford: I support the spirit of the amendment. I believe it is important that there should be direct and ready access among business, voluntary organisations, organisations such as the partnership council and the new assembly. In the previous amendment we discussed the possibility of a joint committee with voluntary organisations. To my mind it is wrong that there should be a filter between the assembly and the businesses and associations that it is intended to serve which would prevent direct communication. We support that aspect of this amendment.
    Further, we believe it is important that there should be a positive duty upon the assembly to consult. Obviously as regards ordinary run of the mill matters it will consult, but the critical issues which cause controversy may be the ones where consultation is ignored. For that reason I support the amendment.
    Lord Elis-Thomas: At the risk of my reputation, I again find myself in agreement with the noble Lord, Lord Mackay of Ardbrecknish. There is an important issue here for the unfolding of the assembly's work. In that context I welcome the great weekend declaration at Llangollen made by William Hague; namely, that we are all now to make the assembly work. I also welcome the declaration of Mr. Michael Ancram that we are all now new unionists. We must wait to see what happens as regards the Conservative Party in the assembly. I say all that to cover myself.
    The important point here is that we should treat all our social partners in the assembly on the same basis. I am a little fascinated by the wording in the relevant clauses that refer to those social partners. As regards local government under Clause 113, the assembly is to "sustain and promote" it. In Clause 114, as regards the voluntary organisations we have just debated, the assembly is,
    "to promote the interests of relevant voluntary organisations".
    A little later we shall discuss equality of opportunity, to which we must have due regard. A report will have to be made on that subject. "Sustainable development", which again we shall discuss later, is to be promoted. But when we come to the poor business sector, the assembly is, according to Clause 115, only to,
    "carry out such consultation with representatives of business as it considers appropriate … ".
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    There is a serious defect here in the Bill. It seems to me that the legislation we are drafting for the National Assembly for Wales falls far short of the best practice of other European legislation and indeed of the best practice of the European Union, its parliament, its Commission, ECOSOC, its Committee of the Regions, and so on, where there are very clear procedures for consultation with business and business experts in any area where legislation is being drafted and regulations are being prepared, so that the business sector knows the direct costs. By the "business sector" I mean, in accordance with my Amendment No. 247A, a whole series of potential forms of enterprise, including people employed by those forms of enterprise and indeed charities and other organisations in the third sector. Whatever the businesses are and whatever form they take, then surely the business costs to them of regulation are an essential issue.
    We debated this matter earlier when I put forward a proposal which I discussed with CBI Wales to try to have the business impact assessed. I appreciate upon due reflection that may not have been the appropriate part of the Bill to try to secure an amendment, but it seems to me that Clause 115 is far too broad, too unspecific and too lacking in content in contrast with other social partnerships and factors we have been debating.
    It is essential that we should have, if not a strengthened clause, then standing orders to ensure a form of consultation for all aspects of relevant subordinate legislation of the assembly with the business sector and that there should be clear deadlines and procedures for all such consultation. Indeed, there might be a case for using the regional committees as an important form of business consultation. But there should be clear guidelines in standing orders on the intended form and structure of business consultation.
    I give one final example of what I mean. We witnessed yesterday in Cardiff a marvellously good-spirited demonstration on very serious issues relating to the agricultural industry and the countryside. The Secretary of State, Mr. Ron Davies, saw fit—and I congratulate him—to meet not only representatives of the farming unions but also others who are in social partnership in the country side, the voluntary bodies and others involved in the demonstration in support of the agricultural industry.
    Consultation is not something which should take place only in periods of crisis. It should be an ongoing part of the assembly's activity. All forms of business, agricultural businesses, service industries, tourism organisations and the very important manufacturing sector, should take part. Maybe the Government will tell us that the specific scheme for dealing with business is the Welsh Development Agency in its new form. I notice that the agency in its statement on the enlarged WDA, and very active and communicative chairman, David Rowe-Beddoe, emphasise that the enlarged WDA will be highly customer focused and will provide greater support to indigenous business and in particular SMEs.
    So the commitment is there from the WDA on behalf of the assembly to be a closer business partner of indigenous businesses and of SMEs in Wales and of all

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    the agency's potential customers. Why can we not have that clearly stated in the clause which involves business? Why can we not have the commitment to enterprise which we know to be at the heart of this Government's policies and of the policies of all the political parties in Wales more clearly spelt out on the face of the Bill?
    Lord Stanley of Alderley: I put down a similar question concerning consultation with agriculture earlier. I got the usual "trust the assembly" answer. I hope that the noble Lord, when replying to my noble friend and indeed to the noble Lord, Lord Elis-Thomas, will be able to be more specific this time.
    Lord Prys-Davies: I have listened very carefully to what has been said by noble Lords and I want to refer to Amendment No. 247A, tabled by the noble Lord, Lord Elis-Thomas, and in particular to paragraph (d). To the best of my recollection, the term "social partners" is not employed in the Bill. The word "business" is employed and "representatives of business" is a term used in Clause 115. However, the word "business" is an indefinite term. I believe that its meaning is wider than "trade". I believe it includes (a), (b) and (c) in the amendment of the noble Lord, Lord Elis-Thomas, but does it include a trade union?
    I am interested in a commitment to discussions with representatives of the trade unions. I have my doubts whether the man on the Rhondda omnibus would understand the term "business" to include his trade union although I have no doubt that he would wish that to be so. I do not have with me the relevant House of Commons Hansard, but I seem to recall that my right honourable friend the Secretary of State for Wales, Mr. Ron Davies, explained in the other place that the term is intended to include trade unions. I would support that, but I believe that the clause requires amendment to make it abundantly clear.
    4.45 p.m.
    Lord Williams of Mostyn: I have a good deal of sympathy with the thrust of what the noble Lord, Lord Elis-Thomas, and my noble friend Lord Prys-Davies said. My noble friend is quite right. The Secretary of State did give an assurance when Clause 115 was being considered in another place that consultation with business would include consultation with trade unions, and of course the amendment of the noble Lord, Lord Elis-Thomas, Amendment No. 247A, together with this group, includes all four amendments spoken to and in a sense prefigures the debate on Clause 115 stand part.
    Amendment No. 247A does take the matter further by defining "business" in the way set out by the noble Lord, Lord Elis-Thomas. The problem with that approach is that there is always a danger that something may be left off the list. We have tried to avoid over-prescription and to look for flexibility, but I take the noble Lord's point very much to heart, because what I have just said relates to drafting and is not about substance.
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    On the substantive point made, not least by the noble Lords, Lord Elis-Thomas and Lord Prys-Davies, I see the force of the argument. If the noble Lord, Lord Elis-Thomas, will withdraw his amendment I undertake to come back at Report stage with an amendment reflecting our preferred approach to drafting; there is not really an issue of substance between us. I think that ought to satisfy the reasonable requirements of the noble Lord, Lord Mackay of Ardbrecknish.
    Amendment No. 247ZA puts a new clause into the Bill. I am not sure how confident the noble Lord is about the amendment, because it jars with what is already in the Bill. Subsection (4)(c), which we discussed on the last amendment, already makes it plain that the voluntary sector scheme has obligations in respect of consultation. The partnership council could, as the noble Lord, Lord Mackay, indicated, be the forum for the usual consultation on local government finance. We do not therefore think that Amendment No. 247ZA helps at all: in fact it really rather muddies the waters.
    Amendments Nos. 247ZB and 247ZC are, as the noble Lord, Lord Mackay of Ardbrecknish, pointed out, simply intended to take out the words "such" and "as it considers appropriate". No assembly ought to be required to carry out consultation with representatives of business which it does not consider to be appropriate. If we adopt the approach suggested by the noble Lord, Lord Elis-Thomas—as I have indicated we accept it in substance and general thrust—that ought to meet the legitimate requirements of the noble Lord.
    I would point out that Clause 66 places quite a number of duties on the assembly. There have to be various regulatory appraisals, including consultation with business, before subordinate legislation is given effect by the assembly where burdens might fall on business. So the interests of business in the field of subordinate legislation are well covered by Clause 66. If we bring forward an amendment intended to cover trade unions and similar organisations, that ought to meet the reasonable requirements of all noble Lords who have spoken.
    Lord Elis-Thomas: I am grateful to the Minister for his response, and in particular for the last few sentences. He referred to my potential Amendment No. 247A in the context of Clause 66, which is already incorporated in the Bill.
    It might be appropriate, as the Minister ponders on fleshing out the spirit of his intention, for him again to examine Clause 66 to see where certain aspects of business consultation not spelt out in the clause might be spelt out more specifically in his redrafted amendment on Report. On that basis, I welcome his remarks.
    Lord Mackay of Ardbrecknish: I am sure that all of us who have taken part in the debate are grateful to the noble Lord, Lord Williams of Mostyn, for his response. Matters were lining up to be an interesting four against one. However, the noble Lord was crafty

    1339
    enough to see that a small amount of movement would be a good thing in response to four noble Lords who thought that the clause was not quite right.
    I am grateful to the Minister. Some of the parts of his answer I well recognised. I think the computer must simply slot in the usual study when somebody asks for a list. I can remember saying, too, that something might be left off it. And I remember that many noble Lords did not believe me. So perhaps I have just joined the list of those who do not believe, having come from the list of those who do believe.
    The noble Lord understands the point that we have all made about the importance of business. I was idly looking at the wording of Clauses 113, 114 and 115. Business could certainly be forgiven for feeling that it was very much thrown in as an afterthought. I know that that is not what the Government meant. I am therefore grateful, as we all are, to the noble Lord for promising to take this matter away and return to the House incorporating some of the points that have been made. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 115 [Consultation with business]:
    [Amendments Nos. 247ZB to 247A not moved.]
    Clause 115 agreed to.
    Clauses 116 to 118 agreed to.
    Clause 119 [Publication and inspection of documents]:
    The Solicitor-General (Lord Falconer of Thoroton)The Solicitor-General (Lord Falconer of Thoroton) moved Amendment No. 247B:
    Page 61, line 12, leave out ("of the Assembly").
    The noble and learned Lord said: This amendment has already been spoken to. I beg to move.
    On Question, amendment agreed to.
    Clause 119, as amended, agreed to.
    Clause 120 [Equality of opportunity]:
    On Question, Whether Clause 120 shall stand part of the Bill?
    Lord Mackay of Ardbrecknish: Rather than table any amendments to this clause, I thought it as well to indicate that I was not content with the clause and to ask the Minister a few questions in relation to it. Having been chided on a number of occasions about this Parliament acting, as it were, as the "nanny" or Big Brother of the Welsh assembly and trying to include matters in the Bill which the assembly would be perfectly able to do for itself, it seemed to me that Clause 120 comes well within that category. I suppose it is included for reasons of political correctness. I cannot think of any other reason. Perhaps the noble Lord will therefore explain why the Government feel it necessary to include this clause. Is it that they do not trust the assembly to deal with these matters properly?
    As the clause stands, whose equality of opportunity are we talking about? Are we referring to those who are to be employed by the assembly, those who will be members of it; or are we looking at every part of the outside world which will have dealings with the
    1340
    assembly—agriculture, business, and so on? The clause seems rather vague. I am not sure exactly whose equality of opportunity we are addressing. Perhaps the Minister will explain.
    If the Minister means the clause to be rather narrower than merely an all-embracing motherhood and apple pie provision, perhaps he ought to come forward with an amendment narrowing down the application of the clause either to the membership of the assembly or to those who will be directly employed by it. The former will be decided by the electorate; the latter are the only people over whom the assembly has some sort of control and some sort of say. I therefore wonder what the clause means. I have the distinct impression that it was slotted in as a matter of political correctness and that it does not carry a great deal of weight. If that is the case, possibly it could be omitted and the assembly could be allowed to deal with these matters on its own. It would reduce the Bill just a little. It is fairly extensive Bill, made more extensive by amendments that have already been made.
    Lord Elis-Thomas: Here comes my golden opportunity to distance myself completely from the noble Lord, Lord Mackay. I have had the great privilege of trying to implement legislation involving the principle of equality in the field of language for almost six years. In that work, equality has been an important guiding principle for me, not only in relation to the organisation of the Welsh Language Board but in relation to those with whom we have sought partnerships.
    I understand this clause to mean what it says; namely, it seeks to promote real equality of opportunity for all people in Wales within the purview of the assembly. The clause is followed by a statement of the arrangements for giving effect to this principle and to how equality is to be promoted.
    That provides an opportunity for the assembly to promote nor merely linguistic equality but equality of opportunity in terms of gender. In addition, it can promote equality of opportunity in terms of what is described in UK parlance as ethnic minority communities, although I do not like that wording.
    Therefore, we are in a sense creating the opportunity in this clause to develop a form of citizenship of Wales, where all those citizens of the country and the new assembly will live under the principle of equality of opportunity for all people. That can be a very positive framework. The noble Lord, Lord Mackay, referred to motherhood and apple pie. It is not about that. It is about the basis of consensual democracy, which is equality of opportunity for all people.
    In the past we have seen some vicious debates on the lines of "linguicism" in Wales, if I may use that term, and certainly on the lines of racism. We have also seen—and there is no danger of my exciting the noble Lord, Lord Islwyn, since he is not in his place—examples of sexism within Wales in all political parties and outwith political parties. This clause gives the assembly the guiding light of equality with which to work. Therefore I warmly welcome its inclusion in the

    1341
    Bill. I look forward to seeing the assembly working hard at implementing in practice the principle that is stated in this clause.
    Lord Williams of Mostyn: I must confess that I find the arguments advanced by the noble Lord, Lord Elis-Thomas, in support of Clause 120 absolutely convincing and persuasive. It is perfectly plain that the clause has two functions. It sets out an objective from which I should not have thought one could dissent. Further, as regards "over-nannying" and not allowing the assembly to get on with things, arrangements are left entirely for the assembly.
    I revert to and echo the spirit of what was said by the noble Lord, Lord Roberts of Conwy. It is useful to have a particular discipline. The discipline is set down in Clause 120(2), that after every financial year, far from saying "Mom and apple pie are, by and large, a good thing conceptually", the assembly must get down to the nitty gritty of saying what arrangements have been made and how effective those arrangements were. I cannot think of a better scheme of devolved power to the assembly with an objective stated, but with the assembly, within the parameters of subsection (2), setting down its own standing orders.
    The noble Lord, Lord Mackay of Ardbrecknish, asked: whose opportunities? Of course it would include employees and members. One would expect that as a matter of course. Perhaps I may give one illustration. If the assembly were considering an aspect of public transport, it would have to do so having regard to disabled people's capacity to benefit from those transport services. It would have to make arrangements to ensure that that aspect of policy was considered. It seems to me that it is rightly in the Bill. There is a correct balance of objective on the face of the Bill—arrangements to be on the basis of subsidiarity, as it were, to be decided by the assembly.
    I take it that the noble Lord was only probing because I am sure that these days no one would suggest that one should disagree with the principle of equality of opportunity for all people. I commend the clause.
    Clause 120 agreed to.
    5 p.m.
    Clause 121 [Sustainable development]:
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 247C:
    Page 61, line 22, leave out from ("out") to end of line 24 and insert ("how it proposes, in the exercise of its functions, to promote sustainable development.").
    The noble and learned Lord said: Members of the Committee will be aware that in February in another place my right honourable friend the Secretary of State introduced an amendment to the Bill which, among other things, placed a duty on the assembly to:
    "Make a scheme setting out its proposals for securing that its functions are exercised with due regard to the principle that sustainable development should be promoted".
    Those provisions are now found in Clause 121(1).
    Since then, the Government have been impressed with the arguments both from within this House during Second Reading and from other interested bodies that the provisions in the Bill relating to sustainable development should be clarified.
    Amendments Nos. 247C, 247E and 247F reflect the Government's response and, I trust, will be seen as a yet further example of this Front Bench being prepared to listen carefully to any and all proposals aimed at improving the Bill.
    Amendment No. 247E deals with subsection (1) to Clause 121 and would place a clear and direct duty on the assembly to make a scheme setting out how it proposes, in the exercise of its functions, to promote sustainable development. This is an important change and reflects the Government's strong commitment to sustainable development. The amendment to subsection (2), Amendment No. 247E, is simply to ensure that the assembly is not required to review its scheme in the year following the first election (for fairly obvious reasons already referred to by my noble friend in respect of the voluntary sector) but that it will have to do so after each succeeding ordinary election.
    Amendment No. 247F introduces a very important change which I am sure will be welcomed by the Committee. It requires the assembly to produce a report after each ordinary election after the first, giving an assessment of how effective its proposals (as set out in the scheme and implemented) have been in promoting sustainable development.
    I believe the amendments show the Government's clear commitment to sustainable development. I beg to move.
    Lord Elis-Thomas: I warmly welcome the amendments, not only on behalf of myself and the Party of Wales, but particularly on behalf of the broad environmental movement in Wales and outside. It places the assembly not only in the context of sustainable development worldwide, within the EU and the UK, but it also provides it with a specific mechanism for assessing its own performance. That is what some of us sought earlier when we emphasised the possibility of an environmental audit committee. Clearly, were the assembly to establish an environmental audit committee, that committee would be an ideal engine for assessing its effectiveness and contributing to that assessment.
    I congratulate the Government on the strong wording of the specific proposals. I am certain that they will be welcomed broadly within the environmental movement and they therefore place the assembly—the Minister will correct me if I am wrong—as probably the only government institution in the United Kingdom, the only level of elected government in the United Kingdom, to have those specific objectives. No doubt that is exceptional, even in the European Union. That allows me to refer in passing to the traffic-free experience we all had in Cardiff this morning, due to the European Council.

    1343
    The new assembly may well be the first elected body in the European Union to be so strongly committed to the principle of sustainable development. It is appropriate and I congratulate the Government on taking that action.
    Lord Mackay of Ardbrecknish: I am grateful to the noble and learned Lord, Lord Falconer of Thoroton, for explaining the two amendments. I am sorry the noble Baroness, Lady Young, is not here to raise the issues that concern her and, no doubt, the interests she represents. I shall refrain from asking for a definition of "sustainable development" because it comes under the same label as motherhood and apple pie and I should accept it for what it is.
    Lord Elis-Thomas: The noble Lord's government, of which he was a strong supporter and member, produced numerous tomes defining "sustainable development" in great detail under the signature of his previous leader, John Major, his previous environmental Minister, John Gummer, and so on.
    Lord Mackay of Ardbrecknish: Perhaps that is why I do not ask for a definition of "sustainable development", because it would take far too long. In any case, I do not believe that the previous government ever tried to put such matters in an Act of Parliament. Never mind. I am not trying to get into an argument, I simply say that it would be interesting to hear the Minister give us an explanation of "sustainable development". I do not wish to tempt him because we want to get on.
    As I read the parts of the Bill, my only observation is that I am surprised that similar obligations are not being placed on the Scottish parliament. I shall need to examine why the Welsh assembly needs all the instructions from here, whereas the Scottish parliament does not.
    Lord Moran: The noble Baroness, Lady Young of Old Scone, unfortunately cannot be here this afternoon and has asked me to move Amendments Nos. 247D and 247G in her absence. I shall be happy to do so. The noble Baroness and I welcome the Government's amendment, Amendment No. 247C, which clarifies and simplifies the sustainable development responsibilities of the assembly. At Second Reading I described the original clause on sustainable development as "opaque". This one is much better.
    Amendment No. 247D, tabled by the noble Baroness), refers to the scheme for sustainable development which the assembly will make. The amendment would achieve two things. First, it would provide a modest framework to focus discussion on the content of the scheme, including objectives monitoring the impact of policies and consultation. The National Assembly Advisory Group, in its consultation document, stressed that it would like to see the assembly's working practices having a strong focus on
    1344
    objectives and outcomes. The amendment applies the criteria to the sustainable development scheme that the assembly will produce.
    The framework for the content of the scheme is not intended in any way to pre-empt the assembly's prerogative to decide its policies on sustainable development in the context of a sustainable development scheme. It merely provides pointers for the overall shape of the scheme and will help the discussion input for a whole range of organisations in Wales which wish to contribute to the scheme, including the national conference on sustainable development which has been announced for early 1999 and which the noble Baroness, Lady Young, welcomes. It also brings the provisions for the scheme into line with the provisions for a similar scheme—that connected with relations with voluntary organisations under Clause 114—and will give some consistency to the two schemes. Overall, the amendment will build on and improve the Government's welcome Amendment No. 247C.
    Amendment No. 247G is an amendment to the Government's Amendment No. 247F. The Government's intention to introduce a process for reporting on the effectiveness of the sustainable development proposals in the scheme is to be welcomed. The issue addressed by Amendment No. 247G relates to the timing and frequency of the report on effectiveness. The Government's proposal is that the report should take place every four years in the year after each ordinary election. Four years is a long period before review and assessment of the effectiveness of a scheme, especially in the early days of a new body like the assembly which will be feeling its way in terms of sustainable development responsibilities.
    Amendment No. 247G proposes a two-year review period. That would have the benefit of avoiding the review coming immediately after an election with little opportunity for the assembly which set the scheme to learn from its operation. A new assembly, reviewing the scheme immediately after an election, would risk having less ownership of the scheme and less likelihood therefore of an interest in whether or not the scheme had succeeded.
    Sustainable development will not be achieved overnight, but a lot can happen in two years. It will be sad if we are four years down the line before we know that some of the policies for sustainable development are not effective.
    Clause 120 on equality of opportunity contains provisions for annual assessment of the effectiveness of the assembly's arrangement. There is therefore a precedent.
    Lord Falconer of Thoroton: I am grateful that all Members of the Committee who spoke in the debate welcomed the provisions of the amendment proposed by the Government in relation to sustainable development. Perhaps I can begin by dealing with the points raised by the noble Lord, Lord Moran, on behalf of my noble friend Lady Young of Old Scone who could not be here today.

    1345
    The amendment proposes, first, that particulars be prescribed for the assembly in relation to what it must put into its scheme and, instead of producing a report every four years after an ordinary election, it is said that there should be a report every two years.
    In relation to the greater prescription, the government amendment requires the assembly to set out how it proposes to promote sustainable development. It is a clear, utterly straightforward obligation. As has been made clear to the Committee, we on this side of the Chamber believe that the assembly must be left with a discretion to determine for itself how it will deal with a range of matters relating to the exercise of its functions, including setting forward its scheme in relation to sustainable development.
    While we recognise the sincerity with which the amendment was tabled, we believe that our amendment, with its straightforwardness and clarity, is better. In relation to the proposal that a report be prepared every two years, we believe again that our amendment strikes the right balance.
    Sustainable development is not about a quick fix. This Government have a broad agenda for sustainable development, encompassing a range of economic, social and environmental objectives. We would expect the assembly to take forward that agenda in Wales. But inevitably sustainable development must look to the long-term future and many of its measures may not be capable of short-term assessment. Having an assessment after each ordinary election would be more appropriate in that it allows time for the assembly's proposals to be adopted and for their effectiveness to be assessed. In that context we consider four years to be more appropriate than two years.
    Lord Moran: On behalf of the noble Baroness, Lady Young, let me say that I am grateful to the Minister, though I am a little disappointed. The amendment did not seek to prescribe, so much as to focus on the principal concerns involved and therefore to speed up the process of working out a proper scheme for sustainable development. However, I understand what the Minister says. I hope that the four-year period will work out. But I fear that, coming immediately after an election, it may not be the best way of reporting. That said, I do not intend to press the amendments.
    On Question, amendment agreed to.
    [Amendment No. 247D not moved.]
    5.15 p.m.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 247E:
    Page 61, line 26, after ("election") insert ("(after the first)").
    The noble and learned Lord said: I have already spoken to this amendment. I beg to move.
    On Question, amendment agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 247F:
    Page 61, line 38, at end insert—
    1346
    ("( ) In the year following each ordinary election (after the first) the Assembly shall publish a report containing an assessment of how effective its proposals (as set out in the scheme and implemented) have been in promoting sustainable development.").
    The noble and learned Lord said: I have already spoken to this amendment. I beg to move.
    [Amendment No. 247G, as an amendment to Amendment No. 247F, not moved.]
    On Question, amendment agreed to.
    Clause 121, as amended, agreed to.
    Clauses 122 to 124 agreed to.
    Clause 125 [Stamp Duty]:
    On Question, Whether Clause 125 shall stand part of the Bill?
    Lord Falconer of Thoroton: My purpose in opposing that this clause stand part is that the provisions relating to stamp duty and the assembly would be best placed in Schedule 9 to the Bill. With the Committee's agreement, this change will be effected by Amendment No. 254 which I will move in our proceedings later today.
    Clause 125 negatived.
    Clause 126 [Minor and consequential amendments]:
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 248:
    Page 62, line 21, leave out ("the Assembly") and insert ("Parts I to IV and this Part").
    The noble and learned Lord said: I have already spoken to this amendment. I beg to move.
    On Question, amendment agreed to.
    Clause 126, as amended, agreed to.
    Schedule 9 [Minor and consequential amendments about Assembly]:
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 249:
    Page 98, line 40, at end insert—
    ("The Parliamentary Commissioner Act 1967 (c. 13)
    . The Parliamentary Commissioner Act 1967 has effect subject to the following amendments.
    . In section 3(2) (performance of functions of Parliamentary Commissioner by officers of his or of a Health Service Commissioner), for the words "or may be performed" onwards substitute ", by any member of the staff so authorised of the Welsh Administration Ombudsman or of the Health Service Commissioner for Wales or by any officer so authorised of the Health Service Commissioner for England or of the Health Service Commissioner for Scotland."
    . In section 4 (departments etc. subject to investigation), after subsection (3) insert—
    "(3A) No entry shall be made if the result of making it would be that the Parliamentary Commissioner could investigate action which can be investigated by the Welsh Administration Ombudsman under Schedule (Welsh Administration Ombudsman) to the Government of Wales Act 1998."
    . In section 11(2A) (disclosure of information between Parliamentary Commissioner and a Health Service Commissioner)—

    (a) after "office as" insert "Welsh Administration Ombudsman or", and

    1347

    (b) for "such a Commissioner" substitute "Welsh Administration Ombudsman or a Health Service Commissioner".

    .—(1) Section 11A (consultations between Parliamentary Commissioner and Health Service Commissioners) is amended as follows.
    (2) In subsection (1) (duty of consultation)—

    (a) after "jurisdiction of" insert "the Welsh Administration Ombudsman or of",

    (b) for "office as that Commissioner" substitute "the office concerned", and

    (c) after "a complaint under" insert "the Government of Wales Act 1998 or".

    (3) In subsection (2) (matters which may be covered by consultation), after "with the" insert "Welsh Administration Ombudsman or a".
    (4) In the sidenote, after "and" insert "Welsh Administration Ombudsman or".
    . In Schedule 2 (departments etc. subject to investigation by Parliamentary Commissioner)—

    (a) in note 1A, insert at the end "; and no investigation under this Act shall be conducted in respect of any action in connection with functions of the Environment Agency in relation to Wales (or an area of the sea adjoining either the coast of Wales or an area of the sea forming part of Wales).", and

    (b) after that note insert—

    "1B. In the case of the Forestry Commission no investigation under this Act shall be conducted in respect of any action in connection with functions of the Forestry Commissioners in relation to Wales."").
    The noble and learned Lord said: I have already spoken to this amendment. I beg to move.
    On Question, amendment agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 249A:
    Page 98, line 42, leave out from ("In") to ("A") in line 2 on page 99 and insert ("Part II of Schedule 2 to the Pensions (Increase) Act 1971 (official pensions), before paragraph 39 insert—
    "National Assembly for Wales
    38B.").
    The noble and learned Lord said: In moving Amendment No. 249A I shall speak also to Amendments Nos. 250A, 254, 256 and 258.
    The amendments proposed by the Government to Schedule 9 are technical matters which should not detain us too long.
    "Official pensions" within the meaning of the Pensions (Increase) Act 1971 are subject to periodic review and uprating. The purpose of Amendment No. 249A is simply to insert into that Act reference to pensions paid by the assembly to its former members, so that they are "official pensions" and the periodic review and uprating machinery bite on them. An equivalent provision is to be made in the Scotland Bill.
    Amendment No. 250A would allow the Auditor General for Wales to be excused from jury service under Part III, Schedule 1 to the Juries Act 1974. That is currently the case with respect to the Comptroller and Auditor General.
    Amendments Nos. 254 and 258 are technical changes. The stamp duty provisions simply replicate what had been Clause 125. This ensures that the assembly is exempt from stamp duty in relation to a conveyance, transfer or lease. Amendment No. 258 extends the definition of "government department" in the Value Added Tax Act 1994 to include the assembly, thus enabling, among other things, the assembly to be able to reclaim VAT as government departments can.
    Finally, Amendment No. 256 amends the Tribunals and Inquiries Act 1992 so that the definition of "Minister" for the purposes of that Act includes the assembly. One of the reasons for this is to ensure that where the assembly makes procedural rules of tribunals it will be required to consult the Council on Tribunals. That does no more than ensure consistency on both sides of Offa's Dyke. I beg to move.
    Lord Elis-Thomas: I shall speak briefly to Amendment No. 249A. This seeks to ensure consistency in all the nations of the kingdom. The amendment would enable the national assembly to arrange by subordinate legislation for the variance of national holidays. There was such a power, as no doubt the Minister will tell me, in the Wales Act 1978. There is a similar power for the Scottish parliament and there is a power for Northern Ireland. I now find, from reading the Western Mail this morning, that the amendment is completely and entirely supported by the Conservative Party. Mr. Michael Settle, under the banner headline "Tories call for St David's Day holiday", writes:
    "The Welsh Conservatives are to put at the head of their Assembly elections campaign a commitment to fight to make St David's Day a national holiday in Wales".
    The report goes on, and I am sure that it is accurate:
    "The campaign for St David's Day to be made a national holiday in Wales appears to be part of a drive within the Welsh Tory Party to help make it a distinctively Welsh party in the eyes of the public in Wales, many of whom have to date regarded the Conservatives as a party of England".
    So I look forward to the support of the party opposite for my amendment.
    Lord Roberts of Conwy: The noble Lord, Lord Elis-Thomas, is right. I was there on Saturday at Llangollen to hear this impassioned speech calling for St. David's Day to be a national holiday in Wales, as would befit our Saint's day. But I am bound to warn the noble Lord that St. David's Day was recommended as a public holiday in Wales in place of the May Day holiday, for which we can find no justification.
    Viscount St. Davids: To add to the list of days which perhaps we should celebrate, I am surprised that the noble Lord, Lord Elis-Thomas, has not suggested 18th September.
    Lord Elis-Thomas: As St. Ron's day!
    Lord Falconer of Thoroton: As the noble Lord indicated, Amendment No. 249B would confer a power to enable the assembly to alter Bank Holidays as they apply to Wales as well as to declare other days as bank

    1349
    holidays in Wales. One effect of the amendment would be to allow the assembly to declare St. David's Day as a bank holiday in Wales. While I recognise that the amendment does not require St. David's Day to be a bank holiday, I suggest to the Committee that we need to consider carefully the wider implications associated with the amendment. Having different bank holidays in Wales and England would not be cost-free for business. The economies of Wales and England are deeply intertwined.
    The Government's general policy has been clear. It is to transfer to the assembly the powers currently exercisable by the Secretary of State for Wales. Those do not include powers relating to bank holidays. If the national assembly had views on this issue, it could, of course, debate it and make representations. But we do not agree that the current legislative arrangements for settling bank holidays should be changed.
    Lord Simon of Glaisdale: If the noble and learned Lord will allow me, surely the transfer from the Secretary of State to the assembly of the powers that are at present exercised is not exclusive. I certainly understood that other powers are to be transferred.
    Lord Falconer of Thoroton: I will have to check this, but I think that there are other powers apart from those exercisable by the Secretary of State.
    Lord Simon of Glaisdale: Perhaps I may say that I am awaiting an answer from the noble Lord, Lord Williams of Mostyn. I said that there was no urgency about it provided I received it before the Report stage. So I am not in any way implying that the noble and learned Lord is to blame.
    Lord Falconer of Thoroton: I did not take it that the noble and learned Lord was. Whatever the specific powers under the Bill, I think the Government's general policy has repeatedly been made clear; namely, it is in general to transfer to the assembly the powers currently exercisable by the Secretary of State for Wales. Whatever the precise detail of the Bill may say in relation to wider powers, the right to determine how many bank holidays there are and when they are is not one of the powers of the Secretary of State. Therefore, it would be contrary to the general policy to give him those powers.
    Lord Mackay of Ardbrecknish: If the noble and learned Lord will forgive me, and at the risk of embarrassing the noble Lord, Lord Elis-Thomas, he seemed to argue that it would not make good economic sense to have different bank holidays in England and Wales. There are already different bank holidays between Scotland and England and the two economies are fairly closely intertwined, especially in the financial sector. We Scots think that we need another bank holiday on 2nd January, for reasons that I shall not go into, and I notice, looking at my diary, that in Northern Ireland there is a bank holiday—I presume it is a bank holiday—on 12th July, for reasons which are totally obscure to me. But that must
    1350
    be different from the rest of the UK. Therefore, I do not think it is a terribly good argument to make to the noble Lord, Lord Elis-Thomas, that somehow or other our economies are so intertwined that one cannot conceive of bank holidays on different days.
    Lord Falconer of Thoroton: Speaking as a Scot myself, I am fully aware of the reasons why 2nd January is an additional bank holiday in Scotland. However, I cannot speak for Wales in relation to when and whether it might need separate bank holidays. I believe I have gone through the reasons why we cannot accept the amendment and I invite the noble Lord to withdraw it.
    Lord Monson: I am very disappointed and surprised by the Government's reply. I support the amendment of the noble Lord, Lord Elis-Thomas, not because I live in Wales—I do not—but because I live in an overcrowded United Kingdom as well as being a believer in diversity and common sense. National bank holidays, which are usually fixed for what are statistically the coldest and wettest Mondays in Spring and Summer, are a recipe for overcrowded roads, overcrowded resorts and overcharging. The more bank holidays are diversified to spread the load, so to speak, the better it will be for people throughout the United Kingdom.
    Lord Elis-Thomas: I am deeply disappointed on behalf of St. David and also on behalf of the noble Viscount, Lord St. Davids, who is his representative on earth, no doubt, in this Chamber, that the Government are not prepared to be more flexible on this matter. However, I do look forward to reading the Conservative manifesto on the assembly when they will be nailing their colours to the mast, their colours being of course the flag of St. David—the black background and the yellow cross. I look forward to withdrawing my amendment in order to support at least one part of the Conservative programme for the national assembly—probably the only one.
    On Question, amendment agreed to.
    [Amendment No. 249B not moved.]
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 250:
    Page 99, line 3, at end insert—
    ("The Local Government Act 1974 (c. 7)
    . The Local Government Act 1974 has effect subject to the following amendments.
    .—(1) Section 23 (the Commissions for Local Administration) is amended as follows.
    (2) After subsection (2) insert—
    "(2A) The Welsh Administration Ombudsman shall be a member of the Commission for Local Administration in Wales (so that, where the offices of Parliamentary Commissioner and Welsh Administration Ombudsman are held by different persons, the Commission for Local Administration in Wales shall consist of at least three commissioners)."
    (3) In subsection (3) (meaning of "Local Commissioner"), after "other than the Parliamentary Commissioner" insert ", the Welsh Administration Ombudsman".
    (4) In subsection (12) (reports by the Commissions), after "government departments" insert "or the National Assembly for Wales".
    . In section 26(6)(b) (no investigation where person aggrieved has right of appeal to Minister of the Crown), after "Minister of the Crown" insert "or the National Assembly for Wales".
    . In section 27(1) (authorities not entitled to make a complaint)—

    (a) in paragraph (a), after "government" insert "(including the National Assembly for Wales)", and

    (b) in paragraph (b), after "department" insert "or by the National Assembly for Wales" and after "Parliament" insert "or the National Assembly for Wales".

    .—(1) Section 29 (provisions about investigations) is amended as follows.
    (2) In subsection (3) (disclosure to Local Commissioner of communications between local authorities and government departments), after "any Government department" insert "or the National Assembly for Wales".
    (3) In subsection (5) (section does not affect restrictions on disclosure of information), before "or" at the end of paragraph (a) insert—
    "(aa) the restriction, imposed by paragraph 24(1) of Schedule (Welsh Administration Ombudsman) to the Government of Wales Act 1998, on the disclosure of information by the Welsh Administration Ombudsman or members of his staff;".
    . In section 32(5) (inclusion in Local Commissioner's report of information derived from government communications disclosed under section 29(3))—

    (a) after "department", in the first place, insert "or the National Assembly for Wales",

    (b) after "department", in the second place, insert "or a member of the Assembly's staff', and

    (c) after "department", in the third place, insert "or the Assembly".

    .—(1) Section 33 (consultation with other Commissioners) is amended as follows.
    (2) In subsection (1) (duty to consult), before "or" at the end of paragraph (a) insert—
    "(aa) by the Welsh Administration Ombudsman, in accordance with the Government of Wales Act 1998,",.
    and, in the words following paragraph (b), after "Commissioner" insert "or the Ombudsman" and after "under the Act of 1967" insert ", under the Government of Wales Act 1998".
    (3) In subsection (2) (matters which may be covered by consultation)—

    (a) after "the Parliamentary Commissioner" insert ", the Welsh Administration Ombudsman", and

    (b) after "that Commissioner" insert "or the Ombudsman".

    (4) In subsection (5) (confidentiality)—

    (a) after "Act of 1993," insert "in paragraph 24(1) of Schedule (Welsh Administration Ombudsman) to the Government of Wales Act 1998", and

    (b) omit "by any of the Commissioners mentioned in this section, or by any of their officers,".").

    On Question, amendment agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 250A:
    Page 99, line 8, at end insert—
    ("The Auditor General for Wales."").
    On Question, amendment agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 251:
    Page 99, line 13, at end insert (", and
    "Welsh Administration Ombudsman."").
    On Question, amendment agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendments Nos. 252 and 253:
    Page 99, line 20, at end insert—
    ("The Mental Health Act 1983 (c. 20)
    . The Mental Health Act 1983 has effect subject to the following amendment.
    . In section 134(3)(c) (no power to withhold correspondence between patients and ombudsmen), after "Parliamentary Commissioner for Administration," insert "the Welsh Administration Ombudsman,".").
    Page 99, line 20, at end insert—
    ("The Mental Health Act 1983 (c. 20)
    . In section 141 of the Mental Health Act 1983 (members of House of Commons suffering from mental illness), at the end insert—
    "(9) This section also has effect in relation to members of the National Assembly for Wales but as if—

    (a) references to the House of Commons were to the Assembly and references to the Speaker were to the presiding officer, and

    (b) in subsection (7), for "defrayed out of moneys provided by Parliament" there were substituted "paid by the National Assembly for Wales"."

    The Insolvency Act 1986 (c. 45)
    . In section 427 of the Insolvency Act 1986 (members of House of Commons adjudged bankrupt etc.), before subsection (7) insert—
    "(6B) Subsections (4) to (6) have effect in relation to a member of the National Assembly for Wales but as if—

    (a) references to the House of Commons were to the Assembly and references to the Speaker were to the presiding officer, and

    (b) in subsection (4), for "under this section" there were substituted "under section 12(2) of the Government of Wales Act 1998 by virtue of this section"."").

    On Question, amendments agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 254:
    Page 99, line 20, at end insert—
    ("The Finance Act 1987 (c. 16)
    . In section 55(1) of the Finance Act 1987 (Crown exemption from stamp duty), after "Her Majesty's Treasury," insert "or to the National Assembly for Wales,".").
    On Question, amendment agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 254A:
    Page 99, line 38, at end insert—
    ("The Official Secrets Act 1989 (c. 6)
    . In section 12(2) of the Official Secrets Act 1989 (which defines a "government contractor" as including a person who provides goods or services for the purposes of a Minister), before "or" at the end of paragraph (a) insert—
    "(aa) for the purposes of the National Assembly for Wales;".").
    On Question, amendment agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 255:
    Page 99, line 38, at end insert—
    ("The Finance Act 1989 (c.26)
    .—(1) Section 182 of the Finance Act 1989 (restrictions on disclosure of information about taxpayers) is amended as follows.
    (2) In subsection (4)(a) (offence for Parliamentary Commissioner for Administration and others to disclose information about taxpayers), after sub-paragraph (ii) insert—

    "(iii) of the Auditor General for Wales and any member of his staff, or

    (iv) of the Welsh Administration Ombudsman and any member of his staff,".

    (3) In subsection (6) (authorised disclosures), in the words after paragraph (e), for "or the Parliamentary Commissioner," substitute ", the Parliamentary Commissioner, the Auditor General for Wales or the Welsh Administration Ombudsman,".
    The Social Security Administration Act 1992 (c.5)
    . In section 123(8) of the Social Security Administration Act 1992 (auditors and investigators of complaints who may not disclose social security information)—

    (a) after paragraph (b) insert—

    "(ba) the Auditor General for Wales and any member of his staff;", and.

    (b) after paragraph (hc) insert—

    "(hd) the Welsh Administration Ombudsman and any member of his staff;".").

    On Question, amendment agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 256:
    Page 99, line 38, at end insert—
    ("The Tribunals and Inquiries Act 1992 (c.53)
    . In section 16(1) of the Tribunals and Inquiries Act 1992 (interpretation), in the definition of "Minister", after "includes" insert "the National Assembly for Wales and".").
    On Question, amendment agreed to.
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendments Nos. 257 to 259:
    Page 100, leave out lines 3 to 28.
    Page 100, line 28, at end insert—
    ("The Value Added Tax Act 1994 (c.23)
    . In section 41(6) of the Value Added Tax Act 1994 (meaning of government department), before "a Northern Ireland department," insert ", the National Assembly for Wales,".").
    Page 100, line 28, at end insert—
    ("The Deregulation and Contracting Out Act 1994 (c.40)
    . In section 79(1) of the Deregulation and Contracting Out Act 1994 (interpretation of Part II), in the definition of "office-holder"—

    (a) after "officer of either House of Parliament," insert "the Auditor General for Wales," and

    (b) after "the Parliamentary Commissioner for Administration" insert ", the Welsh Administration Ombudsman".").

    On Question, amendments agreed to.
    Schedule 9, as amended, agreed to.
    Clause 127 [Extension of functions]:
    Lord Elis-Thomas Lord Elis-Thomas moved Amendment No. 259A:
    Page 62, line 29, at end insert—
    ("( ) for "may" substitute "shall",").
    The noble Lord said: The purpose of this group of amendments is to strengthen the commitment of the Welsh Development Agency to sustainable development. No doubt the Government will argue that in view of our earlier debates these particular amendments are redundant. However, I wish to emphasise that the wording of my Amendment No. 259B is,
    "to promote environmentally sound and sustainable development in the full range of its activities"
    which relate to the WDA. It is drawn from the constitution and mission statement of the European Bank for Reconstruction and Development. Because it is part of that bank's activities, I am certain that it should be similarly acceptable to the WDA. I now see that in the objectives and principles of the enlarged WDA, which the chairman, David Rowe-Beddowe, so kindly sent us, it is now committed to deliver a more strategic approach to sustainable development. Therefore, I suggest to the Government that my amendments are not only acceptable, but they would enhance the WDA in pursuing these objectives. I beg to move.
    Lord Roberts of Conwy: We have not as yet had the opportunity to discuss the new Welsh Development Agency. The amendments that have just been spoken to would seem to be offering as good an opportunity as we are likely to get either with the next set of amendments or on clause stand part.
    We are grateful for the assurance that we have had from the chairman of the existing Welsh Development Agency that sustainable development is close to its heart. As he is also the chairman of the Development Board for Rural Wales, I am sure that the commitment extends to that board also. The new development agency, with its all-Wales brief, was in a sense anticipated when the chairman of the WDA was asked to take over the chairmanship of the Development Board for Rural Wales and to bring the two bodies closer together. That he has done and I believe that Wales owes a debt of gratitude to the chairman, Mr. David Rowe-Beddowe, not just for this achievement but for other improvements that he has brought to the successful working of these two organisations in all the spheres in which they are involved.

    1355
    There is no doubt that mid-Wales, which was the area primarily covered by the Development Board for Rural Wales, had very special problems and suffered from the constant haemorrhage of de-population for many years. That was as attributable to social conditions as to economic conditions. That is why the Development Board for Rural Wales had a social as well as an economic remit which turned out to be useful to the Government in Wales as a whole. Therefore, I welcome the fact that the Bill adds social development to the new WDA's remit. It is part of its inheritance from the Development Board for Rural Wales which is to be merged with the new body. Many will regret the passing of the Development Board for Rural Wales. It has served mid-Wales well. Unemployment rates remained comparatively low in mid-Wales towns at times of recession when they were high elsewhere.
    The Welsh Development Agency has always had a rural remit outside the area of the Development Board for Rural Wales and the industrial areas of south and north-east Wales. It actively pursued improvement schemes of benefit to tourist areas and the general environment. But that work was inevitably overshadowed in the public mind by the agency's success in attracting inward investment and by its massive effort in the land reclamation field. At one stage it had the largest reclamation programme of its kind in Europe. That work is now drawing to an end and it makes sense to combine the land authority for Wales with the WDA because both have similar and complementary expertise in restoring land to commercial use.
    There is another change in this Bill to the remit of the WDA and that is the change of function from promoting industrial efficiency to promoting efficiency in business. I am sure that there is more to the change than meets the eye. I shall be grateful if the Minister can spell that out in his reply. Does it mean that the agency is not confined to assisting industrial and manufacturing businesses and, if so, is it anticipated that there might be a matching change in industrial development grants—in other words, that the scope for such grants might be widened?
    Incidentally, what is to happen to the industry department of the Welsh Office which managed the award of grants? I note that the amendment also refers to exports from Wales and proposes that the new agency should take part in their promotion. In fact, there is a special department or section of the Welsh Office which already promotes exports by small and medium-sized companies.
    The new agency will be very large indeed, not only in size but in its scope. I am sure that that will create problems. The agency has already divided itself on a regional and functional basis and it appears to be ready to manage its new tasks.
    However, one is bound to utter a word or two of warning. I doubt whether in future we can expect the same strong flow of inward investment as we have experienced in the past—and for a variety of reasons: Far Eastern sources of investment are not as buoyant as
    1356
    they were and other markets are opening up, notably in Eastern Europe, which may tempt manufacturing investors to establish themselves there rather than here. Of course, one would like to see more inward investors going to the west of Wales, but ultimately the decision is theirs. Proximity to the strategic road network and an ample supply of appropriate labour are important to such investors. The western-most parts of Wales are not always well endowed in those respects.
    As the amendments under discussion, and others, indicate, there will be many demands placed upon the new Welsh Development Agency, and high expectations of it. However, we must never forget that its main function is to further the development of the Welsh economy and to promote business so that our people have work and can prosper. There must not be too many distractions from those key tasks. I am sure that we are right to emphasise that, especially as we face an enormous problem in the agricultural industry, upon which rural life is so dependent. Who knows, we may well face problems in the industrial areas also in the not-too-distant future. Therefore, I say once again that the development agency must concentrate on its main task, which is the economic development of Wales.
    Lord Falconer of Thoroton: I do not think that anybody underestimates the importance of the Welsh Development Agency or its increasing importance once the assembly is up and running. In our amendments to its purposes, we seek only to focus on that.
    Amendment No. 259A seems to be an attempt to strengthen the legislative requirement upon the WDA to exercise its functions in pursuance of the purposes listed in Section 1(2) of the Welsh Development Agency Act. If that is the intention, perhaps I may assure the noble Lord that it is unnecessary, since the legislation already provides that the WDA can exercise its functions only for the purposes set out in that Act.
    Acceptance of the first amendment in this group would have a material effect on the modus operandi of the agency, which could be to the detriment of Wales. The substitution of "shall" for "may" in Section 1(2) of the Welsh Development Agency Act would place a statutory duty upon the agency to ensure that each function it exercised satisfied each and every one of the purposes listed in that section. That would surely place an unrealistic limitation upon the activities of the agency and deny it the competence to deliver the kind of all-Wales economic, social and environmental development that the Government have promised.
    The Government have already demonstrated their commitment to placing the environment at the heart of policy-making for Wales. As we have already discussed, the national assembly will itself be required to prepare a scheme setting out how sustainable development will be achieved in Wales: whether by itself or via the public bodies, including the WDA, which it will fund and direct.
    The WDA already has as a purpose the improvement of the environment in Wales and as a function the development and redevelopment of the environment. In addition, it has the function of improving the appearance

    1357
    of derelict land. I would assert that the agency's own legislation, together with the relationship it will have with the assembly, will more than adequately provide for it to have a view to sustainable development in its activities and to be able to account for its activities in this area. The Government's view is therefore that Amendment No. 259B is unnecessary.
    With respect to Amendment No. 259C, the Bill clearly establishes the powers of the agency to play a full and effective role in economic and social development in all parts of Wales by transferring to it the social development powers of the Development Board for Rural Wales. Obviously, the way in which these powers are exercised will be subject to the wishes and guidance of the assembly, but I submit to the noble Lord that they would substantially achieve his objectives without the need for Amendment No. 259C.
    Amendment No. 259D would make it a function of the agency to promote exports from Wales. It is an existing purpose of the agency to promote efficiency in business and international competitiveness in Wales, and the agency has an existing function to,
    "promote or assist the establishment, growth, modernisation or development of',
    businesses. At the moment, the Welsh Office is the main provider in Wales of export services and advice. Other bodies, such as the chambers of commerce, the training and enterprise councils and the Mid Wales Export Association, have, together with the WDA, been engaged with the Welsh Office in a review of how export services for small and medium enterprises in Wales might be better co-ordinated. In time, the assembly might wish to make its own arrangements for the provision of export services, but at the moment the agency is fully empowered to participate in the provision of export services.
    The Bill as drafted preserves the wide-ranging permissive powers that the agency has. Control over which of the powers are exercised, and how they are exercised, must rest firmly in the hands of the assembly. Only in that way can we deliver the democratic accountability of public bodies that is fundamental to better government in Wales.
    I appreciate that these amendments may largely be an attempt by the noble Lord, Lord Elis-Thomas, to probe the future powers and role of the WDA. I hope that my answers indicate that we are in considerable sympathy with many of his aims.
    Before concluding, perhaps I may deal with the question asked by the noble Lord, Lord Roberts of Conwy, which was: why change the duty on the Welsh Development Agency from one with respect to "industry" to one with respect to "business"? There is nothing sinister in this. We believe that the word "business" better reflects the diverse nature of the modern Welsh economy. The change will not affect the range of powers available to the Welsh Development Agency.
    I hope that I have given the noble Lords satisfactory assurances in each case and I therefore invite the noble Lord, Lord Elis-Thomas, to withdraw the amendment.
    5.45 p.m.
    Lord Elis-Thomas: I am grateful to the Minister for those assurances. I am also grateful to the noble Lord, Lord Roberts, for reminding us of the activities not only of the WDA but also of the Development Board for Rural Wales, from the work of which I benefited greatly when I was the Member of Parliament for Meirionnydd Nant Conwy. As we see the DBRW being wound up and incorporated into a strengthened WDA, I pay tribute to all who have been associated with it.
    I am particularly grateful for the assurances about the review of export services. We need to consider the current function of the Welsh Office in this regard and whether that function would be better placed with the agency, as proposed in my amendment or whether other arrangements might be established in due course. I welcome the comments about the review.
    Finally, I should have declared an interest as the part-time chairman of Sgrin, which is in receipt of funding from the WDA as part of its media development work. We shall be looking to the WDA to be an even more flexible and an even stronger body in the future in relation to the assembly than it has been in the past. We shall all be concerned about the role of the agency and its ability to function as flexibly as is required by the changing economic circumstances of all regions of Wales.
    I wish the agency well, together with all its staff who—it is important to record this—have gone through a rapid and difficult reorganisation while maintaining the morale and effectiveness of the agency's service delivery. Without naming names, I pay tribute to all who have been responsible for ensuring that. Following the specific assurances that I have received, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendments Nos. 259B to 260 not moved.]
    Clause 127 agreed to.
    Lord Elis-Thomas Lord Elis-Thomas moved Amendment No. 260A:
    After Clause 127, insert the following new clause—
    REPORT BY AGENCY TO ASSEMBLY
    (" . At the end of each financial year, the Welsh Development Agency shall provide a report to the Assembly containing information on—

    (a) the geographical distribution of its expenditure in different parts of Wales,

    (b) the arrangements it has made to assist the Assembly in carrying out its responsibilities under section 120, and

    (c) the arrangements it has made to assist the Assembly in carrying out its responsibilities under section 121.").

    The noble Lord said: Amendment No. 260A seeks to strengthen the reporting arrangements between the assembly and the development agency and the method by which the agency reports to the assembly. In particular, the amendment is related to the activity of the agency in promoting equality of opportunity and sustainable development. I hope that the Government will be able to assure me that it is their intention under the Bill that the agency should clearly operate to those objectives. I was pleased to note in that context—I refer

    1359
    in particular to paragraph (a) which refers to the geographical distribution of expenditure in different parts of Wales—that among the quoted objectives and principles of the enlarged WDA the building of strong regions is a very important aspect.
    I do not know whether the Government are yet in a position to indicate that they now accept the argument that the regional committee structure of the assembly discussed earlier in Committee will approximate to the regions of the development agency. That would provide an opportunity for direct reporting as between the regions of Wales or the regional committees of the assembly and the work of the agency. It would be even more helpful if the Government could provide that reassurance at this stage.
    Therefore, the intention of this amendment is to strengthen the link between the agency and the assembly and ensure that that happens by means of a formal reporting mechanism. The last thing that we want—I say this before the Front Bench opposite does so—is day-to-day political interference in the work of the agency by assembly members. We want to have the setting of broad objectives and the strengthening of reporting and accountability which have generally functioned well in the past, although not always. I beg to move.
    Lord Falconer of Thoroton: As I understand the purpose of this amendment which seeks to insert a new clause, it is to provide that the Welsh Development Agency in its report should deal with certain specified pieces of information, including the geographical distribution of its expenditure in different parts of Wales and the arrangements that it has made to assist the assembly in carrying out its responsibilities under Clauses 120 and 121. Clause 120 relates to sustainable development and Clause 121 is concerned with equality of opportunity.
    I sympathise with the close concern shown by the noble Lord in these matters. Although I cannot go all the way with him, I believe that he is pushing at an open door. Schedule 3 to the Welsh Development Agency Act 1975 requires the agency to report annually on its activities to the Secretary of State. In addition, the agency is required by paragraph 8(5) of that schedule to provide the Secretary of State with such information relating to its activities or proposed activities as he may from time to time require.
    After its establishment the agency will report to the assembly. The assembly will have the same powers as the Secretary of State. The assembly will no doubt closely review the operation of the WDA on an annual basis. We have recently debated Clauses 120 and 121 of the Bill which impose duties on the assembly with regard to sustainable development and equal opportunities. The assembly will in turn determine the role of those public bodies it will fund and direct in discharging its duties under those clauses. That could readily include a requirement on the WDA to report on the matters indicated in this amendment. The assembly will have power to ask for the specific information that the noble Lord wishes to be included in the clause.
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    Under the powers in the 1975 Act it could also require the agency to provide a geographical breakdown of its activities. Therefore, the assembly can make the demands that the noble Lord wishes it to make, but it is not for the Bill to prescribe it but for the assembly to decide. We believe that in neither case is there a need for further provisions in this Bill. I appreciate that once again the noble Lord by this amendment seeks to probe. I hope that I have reassured him sufficiently for him not to seek to press these matters further.
    Lord Elis-Thomas: I am very grateful to the Minister for his reassurance which, together with his earlier reassurance in the context of this debate, enables me to signal quite clearly that the Welsh Development Agency will have a key role in carrying out these objectives. On those grounds, I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 128 agreed to.
    Schedule 10 [Welsh Development Agency: land provisions]:
    Baroness Anelay of St. Johns Baroness Anelay of St. Johns moved Amendment No. 260B:
    Page 104, line 14, after ("is") insert ("a public right of way, or is").
    The noble Baroness said: I beg to move Amendment No. 260B and speak also to Amendment No. 260C which is grouped with it. The issues raised by these amendments, and by Amendments Nos. 261A and 262ZA to which I shall refer later, were drawn to my attention by the Open Spaces Society. A week or so ago that body was preparing amendments for the Regional Development Agencies Bill. It was as a result of its research in relation to that Bill that the society recognised certain deficiencies in this Bill. I am grateful to that society for bringing these matters to my attention so that I am able to raise them today.
    The Open Spaces Society is concerned with the protection and enhancement of commons, public spaces and public rights of way in both town and countryside. These amendments reflect that concern. They intend to clarify or safeguard points of doubt. I accept that more expert drafting than mine may be desirable, but at this stage these are intended to be probing amendments. I hope that at Report stage the Government will be prepared to use them as a basis for their own amendments. I am also aware that the Government have had good prior notice of these amendments. The Open Spaces Society very properly sent on 1st June a copy of the amendments and its arguments to the noble Lord, Lord Williams of Mostyn.
    Amendment No. 260B attempts to remove an ambiguity in the Bill. Neither the Welsh Development Agency Act 1975 nor this Bill appears to contain special provisions for the extinguishment or diversion of highways or public rights of way. It is assumed that the agency must rely on the normal provisions of the Highways Act 1980 or the Town and Country Planning Act 1990. If that is the case it is desirable that it should be made unambiguous, because the standard procedures ensure that certain voluntary bodies are, in the appropriate regulations, given the right to be notified

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    of any such proposals to enable them to make representations. I understand that the relevant bodies covering Wales are: the Auto-Cycle Union, British Horse Society, Byways and Bridleways Trust, Cyclists' Touring Club, Open Spaces Society, Ramblers' Association and Welsh Trail Riders' Association.
    I speak now to Amendment No. 260C which is grouped with this amendment. This amendment also refers to the operation of Schedule 10. Schedule 10 inserts a new Section 21A into the 1975 Act and subsection (2)(b) of that enables the Welsh Development Agency to acquire land to be given in exchange for land forming part of a common, open space or fuel or field garden allotment, but it does not compel such an exchange. Section 19(1) of the Acquisition of Land Act 1981 requires the Secretary of State to certify, for compulsory purchases, that except in minor cases he is satisfied that there will be given in exchange for such land other land not less in area and equally advantageous to the public and commoners, or that the land is being acquired to secure its preservation or improve its management. If the Secretary of State is unable so to certify, the order must be subject to special parliamentary procedure and approved by both Houses of Parliament. It is important that these provisions apply if the agency is able to acquire open space and other such land by agreement. I hope that these will be viewed in the manner in which they are intended—as helpful amendments. I beg to move.
    Lord Falconer of Thoroton: I appreciate the spirit in which these amendments are offered. The amendments seek to ascertain the position in relation to public rights of way and open spaces. I do not believe that either amendment is necessary. I deal first with Amendment No. 260B. That amendment is intended to protect public rights of way. The protection sought by the noble Baroness is already provided by other legislation, in particular the Highways Acts.
    The provisions of the new Schedule 4 to the Welsh Development Agency Act 1975 are intended to provide the agency with the identical powers which for the past two decades have been enjoyed by the Land Authority for Wales without any question of abuse arising from the use of such powers. It is entirely consistent with the Government's intention to create the "new" WDA that the agency inherit these powers. I would reassure the noble Baroness that the agency would not seek to make use of its compulsory purchase powers were an alternative solution available. Indeed, the Act provides that any parties suffering loss as a result of the extinguishment of a public right of way will be entitled to compensation by the agency.
    I hope that in the light of those assurances, the noble Baroness will feel satisfied in relation to the issue of public rights of way to which Amendment No. 260B relates.
    Amendment No. 260C relates to the provision that land acquired by the agency must be used in accordance with planning permission where that land forms part of a common, open space or a fuel or field garden allotment. For perhaps understandable reasons, the noble Baroness is seeking to single out the Welsh
    1362
    Development Agency for particularly stringent treatment here, since her amendment would require the agency to comply with Section 19 of the Acquisition of Land Act 1981 whether or not the land in question had been acquired compulsorily. As matters stand presently, only land acquired compulsorily is subject to Section 19 of the 1981 Act. Where common land is acquired compulsorily by the agency, the provisions of Section 19 will automatically apply, and will continue to apply.
    To extend Section 19, as is proposed in the noble Baroness's amendment, to land acquired by agreement would inhibit the freedom of a landowner to sell land for development which would accord with the needs identified in the adopted local plan. It would be inappropriate to extend to land sold by agreement the legislation which applies only to compulsory purchase. This is no disrespect to the noble Baroness, but she has given no reasons why this extension of the law should be applied. In view of that explanation, I ask the noble Baroness to withdraw the amendment.
    Before the noble Baroness replies, perhaps I may speak to a government amendment in this group, Amendment No. 261. It is of a technical nature relating to the Welsh Development Agency's compulsory acquisition powers.
    As currently drafted, paragraph 16 of Schedule 10 provides that the security of tenure provisions in the Rent Act 1977 shall not prevent the agency from acquiring a house under the Acquisition of Land Act 1981. The Rent (Agriculture) Act 1976 and the Housing Act 1988 also provide for security of tenure and the amendment proposes that that security should not prevent the agency from obtaining possession of the property. However, the amendment does not affect rights to compensation which exist under the Compulsory Purchase Act 1965. Finally, the amendment ensures consistency with the Regional Development Agencies Bill. At an appropriate moment I shall formally move the amendment.
    6 p.m.
    Baroness Anelay of St. Johns: I am grateful to the noble and learned Lord for the assurances he gave on public rights of way. On first hearing, I believe that they meet my objection. I shall read Hansard carefully on the matter. With regard to acquisition of land by agreement and the points he puts regarding Amendment No. 260C, I shall not move that amendment. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    [Amendment No. 260C not moved.]
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 261:
    Page 110, line 38, leave out ("Act 1977") and insert (" (Agriculture) Act 1976, the Rent Act 1977 or the Housing Act 1988").
    The noble and learned Lord said: I have just spoken to this amendment. I beg to move.
    On Question, amendment agreed to.
    Schedule 10, as amended, agreed to.
    Clause 129 agreed to.
    Schedule 11 [Welsh Development Agency: other amendments]:
    Baroness Anelay of St. Johns Baroness Anelay of St. Johns moved Amendment No. 261A:
    Page 113, line 10, at end insert—
    ("(1A) In subsection (4) (duty of Agency to have regard to requirements of agriculture and efficient land management), after "regard to" insert—

    "(a) the conservation and enhancement of natural beauty and the conservation of flora, fauna, and geological or physiological features of special interest;

    (b) the desirability of protecting and conserving buildings, sites and objects of archaeological or historic interest and enabling the public to visit and inspect them:

    (c) any effect proposals would have on the beauty or amenity of any urban or rural area or on any such flora, fauna, features, buildings, sites or objects; and

    (d)".").

    The noble Baroness said: With the permission of the Committee, I speak also to Amendment No. 262ZA which is grouped with it. These are in the nature of probing amendments.
    Amendment No. 261 A inserts a new subsection into Schedule 11 in order to strengthen the recognition of the importance of the environment. In a number of Acts in recent years, bodies which have been given statutory powers have also been required to think positively about conservation. The Open Spaces Society tells me it appreciates that Sections 1(2)(d) and (3)(h) and (i) of the Welsh Development Agency Act 1975 already recognise the importance of the environment, but it is considered that they need strengthening. The proposed amendment is a simplified version of Section 3 of the Water Industry Act 1991. It has been put in Section 1(4) before the existing reference to agriculture for ease of drafting, not to imply an order of importance. As the Committee will appreciate, I would not undertake to table amendments which undermine the importance of agriculture. I believe that the amendment would not do so.
    Amendment No. 262ZA amends the list of definitions of those activities which may be included within the definition of "business" in Schedule 11, paragraph 10(2). It adds the term "recreational" to the list in order to make it clear that the word "business" may include a recreational activity, perhaps that organised by a charity. I beg to move.
    Lord Falconer of Thoroton: Amendment No. 261A seeks to make it a duty of the agency to have regard to the conservation and enhancement of natural beauty and the conservation of the flora and fauna of Wales, as well as to have regard to the protection and conservation of buildings and sites of archaeological or historic interest.
    I am sure the Committee is aware of the sterling work which the Countryside Council for Wales already does with respect to protecting the Welsh natural environment, and that of Cadw in preserving ancient and historical monuments in Wales. I trust that the noble Baroness does not suggest abolishing these bodies or duplicating their functions by placing these further duties on the WDA.
    1364
    If the noble Baroness is concerned that the WDA's economic development work might damage the natural environment or built heritage of Wales, I am happy to set her mind at rest. The WDA is, and will remain, fully subject to environmental and planning law, including that relating to the preservation of sensitive environmental sites and historic building. Furthermore, it will be open to the assembly, in directing the WDA, to ensure that it operates in a way which is sensitive to these issues while not jeopardising its key task of regenerating the Welsh economy.
    The noble Baroness's amendment, Amendment No. 262ZA, seeks to include "recreational activities" among those included in the definition of "business" in the WDA Act. I had rather misunderstood the basis of the noble Baroness's amendment. I had thought that the concern was primarily for the tourism and leisure industry in Wales. However, from what the noble Baroness said in moving the amendment, it would appear that she is concerned about recreational activities carried on by the charitable or voluntary sector in Wales. The main purpose of the WDA is to regenerate the Welsh economy. The matters to which she refers are probably already included in relation to business. I shall contemplate the issue further and bring it to the attention of those who have more significance in this matter than myself. However, I believe that it would be inappropriate for the matters to be dealt with by the Welsh Development Agency.
    Having pointed out that there is no need for these further duties, or that they are inappropriate, I invite the noble Baroness either to withdraw or not to move the amendment.
    Lord Renton: I have not spoken so far on this Bill, for which noble Lords perhaps are thankful. However, this amendment appeals very much to me, and I felt that I should lend my support to it.
    Despite what the noble and learned Lord has already said about the various bodies responsible for protecting the environment of Wales, will he confirm that the elected representatives of the assembly of Wales will also have responsibilities even if this amendment is not accepted?
    Lord Falconer of Thoroton: I do not follow the noble Lord's question. They will certainly have responsibilities, but he has not asked in relation to what. I confirm that they will have responsibilities imposed on them by the Bill—and they will be very substantial responsibilities in relation to the running and governing of Wales—but I cannot go beyond that.
    Baroness Anelay of St. Johns: I am grateful to the noble and learned Lord the Solicitor-General for his assurances in regard to Amendment No. 261A. I certainly have no intention at all of abolishing either the Countryside Council or Cadw, both of which do excellent work. In the light of the noble and learned Lord's assurances I beg leave to withdraw Amendment No. 261A.

    1365
    As to Amendment No. 262ZA, there may be some misunderstanding as to why I wish to move the amendment. I am grateful to the noble and learned Lord for perhaps agreeing that we might come back to it at another stage. I will take further advice on it. I feel that the particular concerns of the Open Spaces Society with regard to Amendment No. 262ZA may not have been met by the noble and learned Lord's remarks so far. I beg leave to withdraw Amendment No. 261A.
    Amendment, by leave, withdrawn.
    [Amendments Nos. 262 and 262ZA not moved.]
    Schedule 11 agreed to.
    Clause 130 agreed to.
    Schedule 12 agreed to.
    Clauses 131 and 132 agreed to.
    Clause 133 [Winding-down]:
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 262A:
    Page 64, line 26, leave out ("conferred or imposed on that Agency") and insert ("imposed on that Agency, or conferred on the Secretary of State,").
    The noble and learned Lord said: I beg to move Amendment Nos. 262A and I shall also speak to Amendment No. 262B. These are drafting amendments. First, they remove the references in Clauses 133 and 139 to functions "conferred" on the Development Board for Rural Wales and Land Authority for Wales. This is superfluous. Only the term "imposed" is needed.
    Secondly, the amendments change the wording of these clauses to reflect that used in similar provisions in Clause 143. The Secretary of State will need the assistance of the Development Board for Rural Wales and the Land Authority to carry out functions conferred on him by Clauses 133 and 139. Inserting the words as printed would require each body to provide it. I beg to move Amendment No. 262A.
    On Question, amendment agreed to.
    Clause 133, as amended, agreed to.
    Clauses 134 to 138 agreed to.
    6.15 p.m.
    Clause 139 [Winding-Down]:
    Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 262B:
    Page 67, line 12, leave out ("conferred or imposed on that Agency") and insert ("imposed on that Agency, or conferred on the Secretary of State,").
    The noble and learned Lord said: I have just spoken to this amendment. I beg to move.
    On Question, amendment agreed to.
    Clause 139, as amended, agreed to.
    Clause 140 agreed to.
    On Question, Whether Clause 141 shall stand part of the Bill?
    Lord Roberts of Conwy: There has been very little parliamentary discussion of the housing issues raised by
    1366
    the transfer of functions of Tai Cymru Housing For Wales to the Secretary of State under Clause 141. All we know is that this body, which had a budget of nearly £63 million in 1997–98, is being absorbed into the Welsh Office which will perform its functions for the time being.
    As to the long-term future of these functions, there is very little light cast in the Bill although housing is listed in Schedule 2 among the 18 fields in which functions are to be transferred by order to the assembly.
    Paragraph 3.31 of the White Paper, A Voice for Wales, states:
    "the restructuring of Tai Cymru's responsibilities will give local authorities a significantly enhanced role in co-ordinating the delivery of local housing strategies matched to the needs of their areas. They will also have the power in appropriate circumstances to provide new housing themselves".
    It seems that the Government have not yet quite decided how housing responsibilities are to be divided. It seems that there is to be some reallocation of duties to local authorities. Will the Minister give some indication of the likely course of events? Housing is traditionally a very important subject in Wales, as elsewhere. It would be remiss of us simply to pass these functions back to the Welsh Office without any comment at all in Parliament.
    Lord Williams of Mostyn: There is not a specific amendment relating to Clause 141. I understand the concerns that have been expressed and I will undertake to write further to the noble Lord, Lord Roberts of Conwy.
    Clause 141 agreed to.
    Schedule 13 agreed to.
    Clause 142 [Transitional provisions]:
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 263:
    Page 69, line 18, after first ("or") insert ("by Housing for Wales or the Housing Corporation for the purpose of or in connection with").
    The noble Lord said: Amendments Nos. 263 and 264 are technical amendments. They are required to correct an omission from the Bill in relation to the functioning of the Housing for Wales' lending responsibilities when they are transferred to the Secretary of State under Clause 141(2).
    Housing for Wales is a qualifying lender under Section 376(4) of the Income and Corporation Taxes Act 1988. It can give mortgage interest relief at source in respect of some 20 mortgages and loans. Some of the loans have been made by Housing for Wales and we have provided for those in the Bill. Other loans inherited by the Secretary of State were made by the predecessor authority, the Housing Corporation in Wales.
    Without these changes the Secretary of State would be unable to give mortgage interest relief at source. That would be undesirable and these amendments simply tidy up the situation. I beg to move.
    On Question, amendment agreed to.
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 264:
    Page 69, line 24, leave out from ("Wales") to end of line 26 and insert ("and are made or commenced before its functions are transferred, and
    (b) for Housing for Wales or the Housing Corporation in any instruments, contracts or legal proceedings which relate to any property, rights or liabilities transferred by section 141(2) and are so made or commenced.").
    On Question, amendment agreed to.
    Clause 142, as amended, agreed to.
    Clauses 143 and 144 agreed to.
    Clause 145 [Accounts, audit and reports]:
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 265:
    Page 72, line 4, after ("Wales,") insert ("the Welsh Administration Ombudsman, the Health Service Commissioner for Wales,").
    On Question, amendment agreed to.
    Clause 145, as amended, agreed to.
    Schedule 14 agreed to.
    Clause 146 [Examinations into use of resources]:
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 265A:
    Page 72, line 30, at end insert—
    ("( ) The Comptroller and Auditor General shall—

    (a) consult the Auditor General for Wales, and

    (b) take into account any relevant work done or being done by the Auditor General for Wales,

    before he carries out an examination under section 6 or 7 of the National Audit Act 1983 (economy etc. examinations) in respect of a body or office specified in Schedule 14.").
    The noble Lord said: This is a drafting amendment to ensure consistency. It will bring Clause 146 into line with comparable provisions elsewhere in Clause 103 and Schedules 5 and 6 where the Comptroller and Auditor General is required to consult. I beg to move.
    On Question, amendment agreed to.
    Clause 146, as amended, agreed to.
    Clause 147 [Transfer etc. of functions of Comptroller and Auditor General]:
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 266:
    Page 72, line 39, leave out from ("Wales") to end of line 40 and insert (", Her Majesty's Chief Inspector of Schools in Wales, the Welsh Administration Ombudsman, the Health Service Commissioner for Wales, a county council, a county borough council or a").
    On Question, amendment agreed to.
    Clause 147, as amended, agreed to.
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 266A:
    After Clause 147, insert the following new clause—
    ENVIRONMENT AGENCY
    (.—(1) The Secretary of State may by order—

    (a) make provision for any function of the Comptroller and Auditor General relating to the Environment Agency to become a function also of the Auditor General for Wales
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    so far as it relates to any of the Agency's Welsh functions or to any funding provided to the Agency by the Assembly, or

    (b) make provision about reports to the Assembly by the Environment Agency on the Agency's activities in exercise of its Welsh functions (including provision for the giving of directions by the Assembly about such reports).

    (2) An order under subsection (1) may contain any appropriate consequential, incidental, supplementary or transitional provisions or savings (including provisions in the form of amendments or repeals of enactments).
    (3) An Order in Council under section 22 may include any provision that may be included in an order under subsection (1).
    (4) In this section references to the Environment Agency's Welsh functions are to its functions so far as exercisable in relation to—

    (a) Wales,

    (b) an area of the sea adjoining either the coast of Wales or an area of the sea forming part of Wales, or

    (c) a cross-border body, or an English border area, in relation to which environmental functions of the Assembly are exercisable;

    and "environmental functions of the Assembly" means functions of the Assembly in a field in which the Environment Agency also has functions.").
    The noble Lord said: In this group are Amendments Nos. 266A, 270A and 270B. Their purpose is to allow the Secretary of State by order to provide that the Auditor General for Wales may have the same functions as the Comptroller and Auditor General as regards the functions of the Environment Agency in relation to Wales and to permit the Auditor General for Wales to undertake value-for-money exercises in relation to those functions.
    At present, the Auditor General has powers only in respect of public bodies whose functions relate exclusively to Wales or to a part of it. The Comptroller and Auditor General will not lose any functions by virtue of these amendments. Under the reporting process, the Environment Agency will continue to produce a single set of accounts covering England and Wales which will be laid before Parliament. As is the present practice, the Comptroller and Auditor General will be entitled to inspect those accounts under Section 46 of the Environment Act 1995. The accounts will include a set of figures covering Welsh activities. It will be presented to the assembly, so it is appropriate that the Auditor General shall be able to inspect them. Under the order-making power of the new clause, the Environment Agency, which is an England and Wales body, will be required to make a report to the assembly about the exercise of its Welsh functions. These are necessary provisions. I beg to move.
    On Question, amendment agreed to.
    Clauses 148 to 150 agreed to.
    Lord Moran Lord Moran moved Amendment No. 267:
    Before Clause 151, insert the following new clause—
    REVIEW AND AMENDMENT OF THIS ACT
    (" .—(1) Subject to subsection (2), the Secretary of State—

    (a) shall, if the Assembly passes a motion to that effect; and

    (b) may, in any event,

    conduct a review of the operation of some or all of the provisions of this Act.
    (2) A review under subsection (1) above shall not include—

    (a) any provision of Part I or III or sections 108 to 110, 152, 153, 155, 156, 158 or 159; or

    (b) any provision less than two years after it has come into force.

    (3) In conducting a review under this section, the Secretary of State shall—

    (a) publish an announcement of the review, setting out—

    (i) which provisions of this Act are included within the scope of the review, and

    (ii) the period, which must be of at least two months' duration, within which interested parties may make representations to him on the outcome of the review;

    (b) consult such persons and bodies as he thinks appropriate; and

    (c) take account of any representations made to him by—

    (i) the Assembly, or any committee of the Assembly,

    (ii) any of the Welsh public bodies mentioned in Part VI in so far as they are affected by the provisions under review, and

    (iii) any other individual, body or organisation in Wales exercising statutory functions which are or might be affected by the review.

    (4) The outcome of a review under this section shall be published in the form of a report and shall be laid before Parliament.
    (5) Where a report under subsection (4) recommends changes to the provisions of this Act, the Secretary of State may, not less than one month after publication of the report, make those changes by order.
    (6) An order under subsection (5) shall not be made unless a draft of the statutory instrument containing it has been laid in draft before, and approved by resolution of, each House of Parliament.").
    The noble Lord said: My Amendments Nos. 267 and 270 are intended to be uncontentious. They are designed to be constructive and to make the Bill more, not less, effective in practice. When I spoke on Second Reading on 21st April, I said:
    "If after some time it becomes clear that there are aspects of the new arrangements which do not work well, the introduction of new, amending legislation might well cause disquiet and controversy by suggesting that the Government might be going back on their commitments. Would it not therefore be sensible, and very much in the interests of the people of Wales, to have a clause in the Bill providing for a review of the arrangements after, say, two years, so that any necessary or desirable changes and improvements could be made without bringing in new legislation?".—[Official Report, 21/4/98; col. 1094.]
    This amendment produces the clause I then suggested. It provides a simple mechanism to enable any small defects which become apparent to be corrected. It applies to only parts of the Bill and the review can be initiated either by the assembly or by the Secretary of State. Any changes will be subject to the approval of Parliament. I commend the amendments to the Government and to the Committee. I beg to move.
    Lord Mackay of Ardbrecknish: There is some merit in the proposal put forward by the noble Lord, Lord Moran, especially as he clearly exempts parts of the Bill which I suspect the Government would not wish to have reviewed. It seems sensible that we should accept that this Bill, as with the Scotland Bill, will not be perfect. This is a novel arrangement for people in the United Kingdom and therefore it is
    1370
    sensible to include some procedure for the review of certain aspects of the legislation. If as a result of the review it is decided that changes are necessary there is a procedure for making those changes. I believe that the amendment deserves favourable consideration by the Government and I look forward to hearing what the Minister has to say.
    Lord Williams of Mostyn: As always, I regard the noble Lord's amendment as intended to be constructive and helpful. I am not able to support it. It would be unusual for a Bill to have a self-amendment clause. I believe that the way forward is to think of Clause 34 which allows the assembly to consider any matter affecting Wales and to make representations accordingly. Therefore, if there were occasions such as those referred to by the noble Lord, Lord Moran, the assembly is able to make representations according to what it finds to be a defect.
    Then there is the proposal that would enable the Secretary of State by order to amend most of the Bill by enactment. I recognise that the amendment is put forward in a constructive way, but we believe that there are strong reasons to reject it. It gives the Secretary of State sweeping Henry VIII powers to allow him to alter the nature of the assembly without regard to the wishes of those who elected it or the assembly itself. The Delegated Powers and Deregulation Committee has already drawn your Lordships' attention to the number of Henry VIII powers already contained in the Bill.
    More fundamentally, we fear that if the noble Lord's amendment were passed it would prevent the emergence of a stable devolution settlement. The Secretary of State could at any time overturn nearly all the relevant provisions without—and I stress this—bringing forward fresh primary legislation. The mere presence of those powers on the statute book would be a recipe for permanent uncertainty and we do not believe that that would be good for the assembly, for Wales or for the Union.
    We support flexibility. I am grateful to the noble Lord for the enormous amount of time and trouble he has taken and for the courteous way in which he has always approached me with his amendments, privately and in correspondence. I am sorry to have to reach the disappointing conclusion that we cannot accept them.
    Lord Moran: I am grateful to the Minister for his reply and I understand what he says. It is unusual to have a review clause in a Bill, but this is a rather unusual Bill. We are entering new territory.
    I welcome his comments about Clause 34 and I hope that it will not be necessary to make changes. However, I believe that in practice there will be defects. We have already found some and corrected them in Committee. I was seeking only to provide a mechanism to achieve that. However, I hope that by using

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    Clause 34 the assembly will be able to make the necessary changes. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Clause 151 [Power to amend enactments]:
    6.30 p.m.
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 268:
    Page 74, line 12, leave out ("subordinate legislation").
    The noble Lord said: This is a drafting amendment to bring the wording of Clause 151 into line with other references to subordinate legislation in Clauses 29(8), 43(6), 44(2) and 46(4). Therefore, it is intended to bring consistency. I beg to move.
    Lord Mackay of Ardbrecknish: Does this amendment mean that once the words "subordinate legislation" are out, paragraph (b) will be referring to subordinate legislation in fact because that is what is made, whereas Acts of Parliament are passed? I do not understand why the Government have tabled this amendment.
    Lord Williams of Mostyn: The point of this amendment is to leave out in line 12 the words "subordinate legislation". I am not entirely sure that I understand the drift of the noble Lord's question. That may well be my deficiency. As I understand it, it is simply to bring consistency and conformity with those other parts of the Bill to which I referred. I may have misheard the noble Lord's question.
    Lord Mackay of Ardbrecknish: It may be that I did not phrase it very well. Do I take it that the Secretary of State may by order change any subordinate legislation, just as in paragraph (a) it appears that he can change an Act?
    Lord Williams of Mostyn: Yes.
    On Question, amendment agreed to.
    On Question, Whether Clause 151, as amended, shall stand part of the Bill?
    Lord Mackay of Ardbrecknish: My noble friend and I have tabled our opposition to this Motion. This clause, as anybody who reads it will see, is a fairly large Henry VIII clause. I am sorry that the noble and learned Lord, Lord Simon of Glaisdale, has left us because I am sure that he would be interested in contributing to the debate. I am sorry also that the noble Earl, Lord Russell, equally interested in Henry VIII clauses, is not with us. Therefore, I must say my few words having learnt at their feet. Whenever I proposed anything that looked vaguely like a Henry VIII clause they came to their feet and reprimanded me.
    I do not believe that I ever proposed anything quite a draconian as this Henry VIII clause. The noble Lord, Lord Williams, suggested to the noble Lord, Lord Moran, a few moments ago that his amendment was a self-amending clause. It seems to me that Clause 151 is a
    1372
    self-amending clause. The Minister suggested also that that amendment would be a Henry VIII clause. Clause 151 is the mother and father of Henry VIII clauses. It states:
    "The Secretary of State may by order make in any enactment contained in … an Act passed before or in the same session as this Act, or … such amendments or repeals as appear to him to be appropriate in consequence of this Act".
    I have little doubt that the Minister will tell me that I should not worry because the matter can be dealt with only by an affirmative order. I regret that I do still worry. It is an enormous Henry VIII clause.
    I can see the point—and no doubt the Minister will make it—that with a piece of legislation as novel to us in this country as this, we may well have missed something with which we should be dealing today. After all, the repeals clause is fairly extensive. I can see that something may be missed which requires to be dealt with; that it would be foolish to require primary legislation; and that an affirmative order is a sensible solution. I am prepared to accept—as I suppose I must because I no doubt did it myself on a number of occasions—that an affirmative order is an acceptable way to deal with Henry VIII clauses.
    However, this provision will be in the Bill for a long time to come. It worries me that way in the future, long after the time for sorting out some of the problems which may arise from learning to live with a new kind of structure in the UK, a Secretary of State—and I notice it is the Secretary of State—may decide to do something which goes beyond anything that we envisage in the course of our discussions in both Houses on this Bill.
    Perhaps the Minister will consider allaying my reservations about this Henry VIII clause by considering a time limit. I shall not suggest whether it should be within a month or a year. However, there should be a reasonable time limit within which the clause should fold. Therefore, it will be there to help the Government to tidy up any loose ends which we may have omitted in Parliament, but it will also come to an end and cannot be used by a Secretary of State some years in the future in a way of which Henry VIII would have certainly approved.
    Lord Hooson: Will the Minister consider what has occurred now after his amendment to take out the words "subordinate legislation" in relation to the wording of Clause 151? It now reads:
    "The Secretary of State may by order make in any enactment contained in … made before the passing of this Act".
    The word "subordinate" should have been taken out but not the word "legislation".
    Lord Williams of Mostyn: The noble Lord, Lord Hooson, may in part be right in that regard. We may well bring a printing revision before the House in due course. That has been noted and I am aware of it. The noble Lord is right about that.
    I turn now to the more fundamental point, if I may say so without disrespect, which is raised by the noble Lord, Lord Mackay of Ardbrecknish. These are reasonable questions to raise. This is not really a self-amendment

    1373
    clause because an order under Clause 151 cannot amend this Bill. It is limited quite substantially, as the Committee will see. The amendment power is limited to:
    "An Act passed before or in the same session as this Act or … legislation made before the passing of this Act or in the session in which this Act is passed".
    I agree that it is a limitation; it is not an entire limitation. But if I understand the noble Lord correctly, he is talking about time in the future relating to time of amendment rather than the time of the passage of the original legislation.
    Clause 151, with the limits that I have indicated, is a means of making consequential changes in the most efficient way possible. We have in mind that it may become apparent that the enacted provisions of this Bill are at odds with another statute. If so, the changes could be effected by order. That means that we do not burden this House or another place with fresh primary legislation to effect no more than what would be technical amendments. I suggest that it would be a waste of Parliament's time to require primary legislation and would produce unjustified, unwarranted and sometimes quite intolerable delay in making the necessary changes.
    I am aware of what the noble Lord said about Henry VIII powers. One always needs to be careful. But the Committee will note that the Delegated Powers and Deregulation Committee saw no need to draw to your Lordships' attention the power in this clause. It noted that it and similar provisions in the Bill,
    "all arise naturally out of the subject matter".
    There is the further limitation that Clause 151 makes it quite plain that it may be used only in consequence of the enacted provisions of the Bill. There is no carte blanche there. The noble Lord rightly foresaw that I would say, as I do, that this will be subject to the affirmative procedure in both Houses, so there is a check on the Secretary of State.
    This clause intends to contemplate that we may have got things wrong; there may be errors and omissions; and it is a fairly simple mechanistic device to put things right, limited in the ways that I have indicated.
    Clause 151, as amended, agreed to.
    Clause 152 agreed to.
    Schedule 15 [Repeals]:
    Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 269:
    Page 131, line 16, at end insert—

  PART AI
  WELSH ADMINISTRATION OMBUDSMAN AND HEALTH SERVICE COMMISSIONER FOR WALES

  Chapter 1967 c. 13.

  Short title The Parliamentary Commissioner Act 1967.

  Extent of repeal In Schedule 2, the entries relating to the Arts Council of Wales (Cyngor Celfyddydau Cymru), Bwrdd yr Iaith Gymraeg (Welsh Language Board), the Countryside Council for Wales, the Office of Her Majesty's Chief Inspector of

  1374

  Schools in Wales, the Sports Council for Wales and the Wales Tourist Board.

  1974 c. 7.

  The Local Government Act 1974.

  In section 33(5), the words "by any of the Commissioners mentioned in this section, or by any of their officers,".

  1989 c. 26.

  The Finance Act 1989.

  In section 182(4)(a)(i), the word "or".

  1990 c. 43.

  The Environmental Protection Act 1990.

  In Schedule 6, paragraph 23(a).

  1993 c. 38.

  The Welsh Language Act 1993.

  In Schedule 1, paragraph 5.

  1993 c. 46.

  The Health Service Commissioners Act 1993.

  In section 2, in subsection (2)(b), the word "and" and, in subsection (5), the words "by Order in Council".

  In section 18(3), the words "by a Commissioner or his officers".

  In Schedule 1, in paragraphs 3(2)(a) and 3A(2)(a), the words "or for Wales" and paragraph 11(2).

  1995 c. 17.

  The Health Authorities Act 1995.

  In Schedule 1, in paragraph 126(2)(b), the words "in paragraph (b), after "Wales," insert "and"".

  S.I. 1995/1615.

  The Parliamentary Commissioner Order 1995.

  In article 2, the words ""Arts Council of Wales (Cyngor Celfyddydau Cymru)",".

  1996 c. 57.

  The School Inspections Act 1996.

  In Schedule 6, in paragraph 1, the entry relating to the Office of Her Majesty's Chief Inspector of Schools in Wales.")

  On Question, amendment agreed to.
  Lord Williams of Mostyn Lord Williams of Mostyn moved Amendments Nos. 269A and 269B:
  Page 139, leave out lines 18 and 19.
  Page 141, line 39, column 3, leave out ("91,").
  The noble Lord said: Again, these are simple technical amendments. They are necessary because the Statute Law (Repeals) Bill, which is currently proceeding through Parliament, will repeal the Land Commission Act and the provisions in the Housing Act 1988. Therefore, there is no need for those references to appear in Schedule 15.
  On Question, amendments agreed to.
  Schedule, 15, as amended, agreed to.
  Clause 153 agreed to.
  Clause 154 [Orders and directions]:
  [Amendment No. 270 not moved.]
  Lord Williams of Mostyn Lord Williams of Mostyn moved Amendments Nos. 270A, 270B and 271:
  Page 74, line 30, after ("147(1)") insert (", (Environment Agency)(1)").
  Page 74, line 43, after ("147(1),") insert ("(Environment Agency)(1),").
  Page 74, line 43, leave out ("or paragraph 1 of Schedule 6") and insert (", paragraph 1 of Schedule 6 or paragraph 16(9) of Schedule (Welsh Administration Ombudsman)").
  On Question, amendments agreed to.
  Clause 154, as amended, agreed to.
  Clause 155 [Interpretation]:
  [Amendment No. 271A not moved.]
  Clause 155 agreed to.
  Clause 156 [Defined expressions]:
  Lord Williams of Mostyn Lord Williams of Mostyn moved Amendments Nos. 271B to 271E:
  Page 76, line 7, column 1, leave out ("area") and insert ("body").
  Page 76, line 7, leave out column 2 and insert ("paragraph 3(2) of Schedule (Transfer etc. of functions: further provisions)").
  Page 76, line 12, at end insert—

  ("English border area

  paragraph 3(2) of Schedule (Transfer etc. of functions: further provisions)")

  Page 76, line 26, at end insert—

  ("relevant Parliamentary procedural provision

  section 45(3)")

  On Question, amendments agreed to.
  Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 272:
  Page 76, line 31, at end insert—

  ("Welsh Administration Ombudsman

  section (Welsh Administration Ombudsman)")

  On Question, amendment agreed to.
  Clause 156, as amended, agreed to.
  Remaining clauses agreed to.

  In the Title
  Lord Williams of Mostyn Lord Williams of Mostyn moved Amendment No. 273:
  Line 2, leave out ("office of Auditor General for Wales") and insert ("offices of Auditor General for Wales and Welsh Administration Ombudsman").
  On Question, amendment agreed to.
  House resumed: Bill reported with amendments.

  National Minimum Wage Bill
  6.44 p.m.
  The Minister of State, Department of Trade and Industry (Lord Clinton-Davis): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
  Moved, That the House do now again resolve itself into Committee.—(Lord Clinton-Davis.)
  Lord Fraser of Carmyllie: My Lords, before we move to a resolution on that Motion, there is an important matter which I feel I must raise at this time. It is a matter that I have raised in the past, and especially on the first day of Committee on the Bill. As the Minister will appreciate, we have repeatedly raised the issue of the publication of the report by the Low Pay Commission and the Government's reaction to it. Indeed, my noble friend Lady Miller mentioned it on Second Reading. When he responded to these matters on the first Committee day last Thursday, the Minister indicated (at col. 1199 of Hansard) that the Low Pay Commission would make a report of its findings. We sought to explain to him why we regarded it as important that we at least saw the report, preferably before the end of our time for consideration of the Bill, and also had sight of the Government's reaction to it.
  The Minister (at col. 1203 of Hansard), rebuked me for having relied upon a report in the Daily Telegraph last Thursday, and for relying on "titbits of information" based on speculation. That was because there had been a report that Mr. John Monks of the TUC was writing to the Government offering his detailed views on the report. There are repeated references to the report and why we considered it desirable to have sight of it. The noble and learned Lord the Solicitor-General wondered why we were so concerned to see the report. Again, it was repeated that there was no need for this and that we would be seeing it in due course.
  However, early yesterday morning Mr. John Edmonds, who I understand is the General Secretary of the GMB, appeared on GMTV. During the course of an interview in that programme he indicated that not only did he have before him in the studio an executive summary of the report from the Low Pay Commission but also that he had a full copy of it. Clearly he had had it for some time. He indicated that it was large, dense and extensive but that he had, nevertheless, read it in its entirety.
  The matter which is of real concern to us is the fact that it would now appear that there is direct evidence to show that senior members of the trade union movement have been given access to the report before Parliament has had any opportunity to consider it. We certainly have not seen the report, despite repeated requests in that respect. I do not blame the Minister personally for this, but he indicated that we would see the report before the end of last month. We are now halfway through June and we have not seen it; but others clearly have and they are not parliamentarians.
  It seems to us to be yet another example of this Government's arrogance, their contempt for Parliament and their partiality. We continue to regard it as

  1377
  extremely important that we see the report and, indeed, the Government's reaction to it before we complete consideration of this Bill. I hope that the Minister will not fob me off with some excuse that this must have been a leak. The demeanour of Mr. Edmonds on television and the way that he approached the matter made it perfectly clear that he was not a man in possession of a document which he believed he should not have. Indeed, he was quite open about having considered the report. He offered his detailed comments on it and, as I said, indicated that he had read it in its entirety.
  Before we are prepared to make further progress on this Bill, we want to know when we will see this report. We really must see it. It is a matter of considerable concern to us that others should already have seen the report. The fact that Mr. John Monks was in a position to offer detailed comments to the Government on it, as revealed in the Daily Telegraph last Thursday, would indicate that he had seen it and that he had had knowledge of it for some time. Moreover, Mr. John Edmonds quite openly said on television yesterday morning that he had seen it.
  Will the Minister tell us whether the report was issued to these senior trade unionists with the approval of the President of the Board of Trade, or with the approval of the Minister of State who has responsibility for the Bill in the Department of Trade and Industry? Who else has been privileged to see this report before anyone in either of the two Houses of Parliament has been permitted to see it? This is becoming an intolerable state of affairs.
  A similar thing happened to my noble friend Lady Blatch with regard to the education Bill currently before the House. My noble friend discovered that a large number of reports and papers had been passed to other people, but she is still unable to obtain those publications. We must insist that we see this report immediately. We must also insist that it is disclosed to us who has seen this report and on what basis. What possible justification is there at a time when there is legislation going through Parliament for that report not to be made available to those who need to see it to enable them to consider the Bill? I hope that the Minister will give us a full and open response. We shall certainly not be fobbed off with the notion that this was in some way a simple leak. If the Minister had seen the television programme yesterday, he would know perfectly well that that is not the case. I hope he can offer me the answers that I seek.
  Lord Clinton-Davis: My Lords, I am grateful to the noble Baroness for giving notice that this point would be raised. That is acting within the courtesies of the House. I can say little about Mr. Edmonds. First, I did not see GMTV. I do not think I have ever watched GMTV. Perhaps I should have done so on this occasion. It is said—it is an allegation that I neither corroborate nor refute—that Mr. Edmonds had a report of the executive summary and indeed a full copy of the report. All I can say is that the report has not been published. That, of course, is a matter for Ministers. No one has authorised the disclosure of the report to Mr. Edmonds, as far as I know.
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  The noble and learned Lord asked who has seen the report. Relevant Ministers have, of course, seen it. As I said, we have not agreed the disclosure of the report to anyone outside, or indeed at this stage, within Parliament. The noble and learned Lord said that this is an act of partiality. He draws an inference therefore that we have given the report to Mr. Edmonds. That is not true. The noble and learned Lord referred to the demeanour of Mr. Edmonds. I know nothing about his demeanour because I did not see the programme. All I can say is that if Mr. Edmonds has received a copy of the report which was not authorised, I believe he would have been ill advised to have said so. But there we are.
  The noble and learned Lord asked about the date of publication of the report. I can give him no additional information beyond that which I advised the House of on the previous occasion we met. The report will be published at the earliest opportunity. As regards whether Mr. Monks has seen the report, my remarks apropos Mr. Edmonds and others apply equally in that regard. We have not been partial and we have not disclosed the report officially or authoritatively to anyone. I hope that the noble and learned Lord will accept my bona fides in that regard. I would not make a statement to the House which attempted to mislead the House in any sense. The noble and learned Lord knows that. That is all I can say about the matter at this stage. I am perturbed that Mr. Edmonds appears—if the noble and learned Lord is right—to have received the report. I can go no further than that.
  Lord Fraser of Carmyllie: My Lords, I must first make it clear that I do not intend to suggest in any way that the noble Lord has been involved in this matter or that he might have authorised the disclosure of this report to senior trade unionists. That is why in my opening remarks I specifically asked whether the Minister of State, Mr. McCartney, who has the primary responsibility for this Bill and for low pay issues within government, had authorised the disclosure, or whether his senior Minister in Cabinet, the President of the Board of Trade, had authorised it.
  I accept the noble Lord's bona fides in this matter. However, I am bound to say that my credulity is stretched when on Thursday in the Daily Telegraph Mr. Monks can offer authoritative comment on the contents of the report, and on Sunday another senior trade unionist can appear on television and offer similarly authoritative comment on the report. He was quite open about having not only an executive summary, but the full report which he had read from cover to cover. I find it extremely difficult to believe that somehow or other a copy of the report of the Low Pay Commission was spirited out of the DTI or some other department and happened to find its way into the hands of individuals such as Mr. Monks or Mr. Edmonds, and that no one knew anything about it.
  As I say, I do not attribute any personal blame to the noble Lord or suggest that he authorised the disclosure, but the matter looks extremely suspicious. I do not withdraw my comment that it appears to be hugely partial to allow senior trade unionists access to this report before anyone in Parliament has the opportunity

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  to consider it. We are extremely concerned about the matter. We are prepared to make progress on the Bill but we shall certainly pursue the matter in correspondence and in questions. It simply will not do to have another report being circulated to which Parliament ought to have access. If nothing else, the Minister should indicate to us that he will have an inquiry undertaken to discover how these senior trade unionists have one or more copies of the report, and whether that was authorised by anyone. If it is concluded that there has been a leak, we would expect something to be done about it. At the very least we would hope that the noble Lord would offer an apology to your Lordships' House for the way in which we have been treated in this matter.
  Viscount Thurso: My Lords, before the Minister responds, I do not think I have ever seen GMTV either. Before I entered the Chamber this evening I was totally unaware that this matter would be raised. Perhaps I might ask that when notice is given of these matters it might be extended to Members on these Benches also. Clearly it is disturbing if a report is released which should come before Parliament. I accept the assurances that have been given by the noble Lord, Lord Clinton-Davis. Furthermore, I think it is slightly disingenuous of the noble and learned Lord, Lord Fraser of Carmyllie, to indicate that he may be prepared to hold up the business of your Lordships' House in Committee on this point.
  Lord Fraser of Carmyllie: My Lords, the noble Viscount might have listened to what I had to say. The noble Lord the Government Chief Whip probably noted my remarks with rather keener interest when I said that while I would pursue the matter in correspondence and questions I did not wish to hold up the business at this stage.
  Viscount Thurso: My Lords, I am most grateful to the noble and learned Lord for that assurance. Having not had notice of what was to be said and the consequences of it I had to listen rather harder to the exchanges. As I said, I am prepared together with, I believe, Members on these Benches, to accept the assurances of the noble Lord, Lord Clinton-Davis. I hope that we can now get on with this important piece of legislation.
  Baroness O'Cathain: My Lords, before the Minister responds to that point, I make the observation that as there appears to have been not a leak but a general distribution of this report, would it not be in the best interests of the quality of debate within this Committee and the contribution that can be made from all four corners of this Committee to this important issue if the Minister could give us the undertaking that the report could be issued to us as soon as possible, that is, either tonight or tomorrow?
  Lord Clinton-Davis: My Lords, I certainly cannot respond affirmatively to the noble Baroness in that way. Moreover, I want to say definitively that there has been
  1380
  no general distribution of the report. I am obliged to the noble and learned Lord, Lord Fraser, for saying that he is content to make progress, but before we move on to the Committee stage I want to say that I refute the allegation, on the basis of the information that I have, that any Minister authorised the release of this report to anybody.
  I cannot go beyond that. I hope that we can now make progress, and of course a statement will be made at the earliest opportunity. I am not in charge of this Bill within the department. The noble and learned Lord knows perfectly well that it is my honourable friend the Minister of State who is in charge of it. I am here speaking together with my noble friends at the Committee stage and on behalf of the Government during this stage and succeeding stages of the Bill. That being the case, I hope that we can now move on.
  On Question, Motion agreed to.
  House again in Committee accordingly.
  7 p.m.
  [The DEPUTY CHAIRMAN OF COMMITTEES (Baroness Nicol) in the Chair.]
  Clause 9 [Duty of employers to keep records]:
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 65:
  Page 7, line 30, after ("such") insert ("reasonable").
  The noble Baroness said: I should like to speak to Amendments Nos. 65, 67 and 68, all of which relate to Clause 9. They are intended to improve the working of the Act, as it will be, and its administration. It is entirely right and proper that employers should be required to keep adequate records to enable employees and the authorities responsible for the enforcement of the Act to see whether the minimum wage has been paid. We support that. Our reasons for putting forward Amendments Nos. 67 and 68 are that the clause as drawn at present gives rise to the possibility of an extra, unnecessary and entirely superfluous set of records being required.
  Employers are already required to keep substantial and detailed records of pay and benefits for the purposes of PAYE and national insurance. These records adequately provide all the information that an employee will require about the remuneration that he has received. Their accuracy is guaranteed so far as possible under the sanction of severe financial and possible criminal sanctions under the taxation and social security law.
  Where the tax and national insurance records do not meet the needs of an employee for the purposes of this Bill is that they do not show the number of hours worked and possibly details of matters which the Low Pay Unit says are to be taken into account in calculating net pay for the special purposes of this Act. This potential deficiency in the records is, I believe, partially covered by the second half of the proposed new subsection (2), starting in Amendment No. 67 with the words,
  "save for details of the number of hours worked and any benefits in kind".

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  In other words, under this clause the employer still has to keep records on the number of hours worked, but even this does not go far enough to assist the employee. So in addition there is the new subsection proposed in Amendment No. 68, which I assume would be numbered (4).
  This will allow records which will eventually be required to be kept by the employer in compliance with the European Community Working Time Directive also to satisfy the requirement to keep records under this Bill. I cannot believe that the bureaucratic requirements of the European Community will not be entirely sufficient for the purposes of the DTI.
  I turn now to the modest Amendment No. 65 to be made to Clause 9(b). Once again, because of a quirk of the grouping list, I am speaking to it out of its logical sequence. Again, we agree that it is right that in formulating regulations with regard to the keeping of records provision should be made for how long those records should be retained. All the amendment requires is that whatever stipulation the Secretary of State may make in this regard should be reasonable, for, as drawn, the Bill enables her to require such records be kept for 20, 50 or even 100 years. Obviously no such nonsense is intended by the Government.
  From the employee's point of view, it would be equally detrimental if an unreasonably short period of retention were to be prescribed. The Acts governing income tax, PAYE, national insurance and VAT all prescribe how long records are to be retained, and there is absolutely no reason why the regime under this Bill should require anything different. Rights under this Bill will essentially be a civil claim for a debt, and there is equally really no reason why the regulations should prescribe anything longer than the basic limitation periods for making civil claims.
  However, I am not going to try to second-guess the Secretary of State. She can decide the period, as the Bill at present provides. All that she has to do is to see that the period is reasonable. I asked for the word "reasonable" to be inserted in Clause 1(4) in my Amendment No. 4 which was discussed last Thursday. The Solicitor-General spent a little time trying to justify the proposition that it would be inhibiting to the operation of the Bill if there was a specific requirement to be "reasonable". In effect he said, "Trust us: we are the Government". Well, I am casting no aspersions, but in the case of the present amendment, if the Government's word is as good as their bond, then let them give us their bond. Frankly, I was unable to understand the logic of the argument that if the word "reasonable" was used in the Bill it would generate a flood of litigation. Leaving out the word, however, does not exempt the Secretary of State from being reasonable in any reasonable interpretation of that word.
  The Minister is perfectly well aware that there is a right for an aggrieved citizen to have the court's rule on irrational and unreasonable conduct by a Minister. This right was fully defined in the case of Associated Provincial Picture Houses v. Wednesbury Corporation in 1948. In that case the late and highly distinguished Master of the Rolls, Lord Greene, codified the law into
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  what are called the Wednesbury Rules. The present Lord Chancellor described the Wednesbury Rules as the locus classicus of British administrative law.
  In other words, the Government cannot escape from the duty of being reasonable by not including that word in this Bill. They cannot, ostrich-like, hide their heads in the sand and pretend that this elementary and essential obligation on their part does not exist. An aggrieved citizen will still be entitled to take the Government to court if he believes that they are behaving unreasonably. Agreeing to the use of the word is therefore merely a promise by the Government about their future conduct.
  Whatever theoretical objections there were to promising to be "reasonable" for the purposes of Clause 1, which we debated ad nauseum last Thursday, there can surely be absolutely none for this clause. There is ample precedent for the periods for which records are required to be retained for taxation and similar purposes. It bears repeating that the burden of this Bill is largely going to fall on the small and medium-sized businesses. Larger concerns will be able to absorb the administration involved into their pay and accounts departments, but in the case of SMEs this will just add to the work to be done, usually by local shops: businesses like hairdressers and small-sized manufacturing operations. There is no reason to add to their administrative costs and red tape and to provide work for even more inspectors when entirely adequate records are already available. Equally, we do not want to see some wretched local shopkeeper being dragged before the magistrates or subjected to an administrative penalty, not because he did not keep perfectly adequate and practical records but because he did not do so on a particular design of form prescribed by the Secretary of State.
  The amendments to this clause are tabled in the course of this House carrying out its function as a revising Chamber. I hope the Government will agree that their purposes are purely constructive. I hope they will be willing to accept them.
  Lord Falconer of Thoroton: There are three amendments in this grouping, Amendments Nos. 65, 67 and 68. As the noble Baroness said, they all relate to record-keeping. I think we all agree on the importance of record-keeping to the success of the Bill. Without adequate records, it will not be possible to enforce the legislation. A worker needs to see what he is being paid, and an employer needs records in order to be able to defend himself in case he is accused of under-paying. It is therefore in the interests of all that adequate records are available. I believe that the noble Baroness accepts that.
  Perhaps I may deal with the amendments in the order in which the noble Baroness did. Amendment No. 67 seeks to limit the Secretary of State's flexibility to decide the form and content of records by tying them to the types of records already required for income tax or national insurance purposes. It is drawn on what seems an entirely laudable aim; namely, to avoid undesirable duplication in the records kept by an employer. Underlying it there would also seem to be the desire to place as little a burden as is necessary upon the

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  employer. That is an aim that we unquestionably share. We agree with the motive of avoiding duplication. We have said so clearly on a number of occasions, in particular in the regulatory appraisal for the Bill, where we pointed out that most wage detail will indeed already be kept for tax purposes.
  Without being boring, perhaps I may remind the Committee of what we said in that document. We stated:
  "It is in employers' own interests to know how much they are paying their staff. Therefore, it is reasonable to expect that employers will already have records for the calculation of total pay that will be sufficient to calculate pay as it relates to the national minimum wage. They will already have such records available for inspection by the Inland Revenue and Contributions Agency".
  The regulatory appraisal went on to note that there will be differences in the types of records to be kept, not least in relation to the number of hours worked and any non-monetary payments which may be allowed to count towards the hourly minimum wage rate. The amendment acknowledges that. That is why it expressly allows for different requirements to be added.
  The noble Baroness has made the case for the clause as it stands within the terms of her own amendment. It is for the very reason that different types of records may be required that we have drafted the power to make record-keeping regulations quite broadly.
  I should also remind the Committee of our commitment to consult on the regulations in draft form before bringing them to the House. There will therefore be an opportunity for businesses and individuals to make representations on the record-keeping regulations. I thank the noble Baroness for drawing my attention in the proposed amendment to the various related statutes covering record-keeping for tax and national insurance purposes. The Government will be considering very closely the relationship between those records and any further records to be kept for national minimum wage purposes in the light of the feedback from the forthcoming consultation.
  I hope it is clear from my remarks that the noble Baroness's Amendment No. 67 and the Government's purpose in relation to it are very similar. We say that there should not be an amendment because we want to give maximum flexibility with the same aim. However, it goes slightly further. The noble Baroness may know that the Delegated Powers and Deregulation Committee regards the affirmative procedure that we have laid down in the Bill and which is required for these regulations as too high a level of parliamentary control for use of the power in Clause 9 to impose record-keeping requirements on employers. The committee believes that the negative procedure would be adequate. I also note its indication that this is a rather unusual conclusion for it to reach in the context of its security functions.
  Far be it from me to want to make life unnecessarily difficult or complicated for the Government. However tempting the committee's proposal might be, I consider it preferable to stick with the affirmative procedure for this measure. It potentially affects all firms; it could add burdens upon firms; and we can expect this measure to attract substantial interest from employers and their
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  organisations, who are always sensitive to the perceived expansion of red tape. It is a measure which could also involve quite complicated issues such as the keeping of records in the case of homeworkers and pieceworkers.
  I very much hope that our introduction into the Bill of the affirmative procedure in relation to this matter, and our sticking to it despite the remarks of the delegated powers scrutiny committee, indicate that we are concerned about burdens on employers and want to make sure that they are as limited as possible. For those reasons, I do not believe it appropriate for the Bill to be changed in the way suggested in Amendment No. 67.
  I now turn to Amendment No. 68. The noble Baroness made the point that she could not believe that a burden imposed by Europe could be less than a burden to be imposed by the DTI. Amendment No. 68 would limit on the face of the Bill the Secretary of State's flexibility to decide the formal manner of records to be kept in respect of hours worked for minimum wage purposes by tying them to records of hours worked which may be kept for the purposes of showing compliance with the working time directive.
  Noble Lords will, I hope, welcome both these initiatives as a sign of the Government's commitment to improving the lot of workers who are obliged to work for too long and/or for too little. These are basic matters of social justice and fairness, as well as matters of sound common sense. It is much to the credit of this Government that we are proceeding apace with making them part of domestic legislation. As I have already said, we do not think it right to prescribe on the face of the Bill the type of records that must be kept. We intend to consult.
  I have referred to the affirmative procedure. I should make it clear that the draft working time regulations, on which further consultation has just been completed, contain a general record-keeping requirement on all employers. Employers simply need to show that the limit of 48 hours' working time is being complied with. They are not necessarily obliged to keep records of hours worked as proof. For example, it might be sufficient for an employer to show that his premises are only open for 48 hours a week and that therefore none of his workers could be exceeding the time limit. Therefore there is no general requirement on all employers to keep records of hours worked. On that ground alone, the amendment would be unsuitable.
  There is a more specific record-keeping requirement in the draft working time regulations which does require employers to keep records of hours worked. However, that applies only to those employers with employees who have opted to work longer than the 48-hour limit. I therefore have considerable doubts as to the suitability of this amendment in the context of the minimum wage.
  However, I take the general point at which the amendment is perhaps aimed; namely, that minimum wage records will almost certainly need to cover hours worked, however that may be defined, and there may be scope for avoiding duplication with other, similar records. All of those sorts of issues will be examined during the consultation, and those particular issues can be examined when the regulations are placed before the House.

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  Finally, the noble Baroness gave an extremely accurate account of the law in relation to Amendment No. 65—and thereby clearly demonstrated why it was wrong to insert the word "reasonable" in relation to this provision. I am sure that everyone agrees that reasonableness is something that we all desire. When we require an individual to make certain records and to keep them, we would not require him to keep them for an unreasonably long time, or indeed for an unreasonably short time. I cannot tell the Committee at this point exactly what type of records we shall be requiring, or the period of time for which they must be kept, because the detail will be determined by secondary legislation following a process of consultation. We shall draft the regulations and draw up a consultation document as soon as the Bill is enacted, if that be the wish of Parliament.
  But let me take this opportunity to reiterate our overall enforcement objective. We will do our utmost to encourage everyone to comply with the national minimum wage. We will ensure that it is effectively enforced, and with the minimum necessary burden on business. Record-keeping is the key to that.
  There are plenty of precedents for record-keeping requirements. There are already laws about keeping income tax, national insurance and VAT records, and about keeping sick pay and maternity pay records, to give just a few examples. I can assure the House that we shall look at those precedents, and more, in considering the periods for which records must be kept.
  But the word "reasonableness" does not need to be written on to the face of the Bill. As the noble Baroness pointed out, the case of Associated Provincial Picture Houses in Wednesbury means that, in making a decision such as this, the Minister is required to act within the bounds of reasonableness. If he or she acts irrationally, perversely or outside the bounds of reasonableness, then subject to the circumstances of the case, there will be an opportunity for the person affected to go to court and raise the matter. If, however, as the noble Baroness now suggests and as she suggested on a previous occasion, you put in the word "reasonableness", you invite the applicant to bring proceedings to get the court to determine what it believes is the appropriate course, not what the policy Minister thinks. However, the last people in the world who should determine the matter is the courts. It should be the Minister, after consulting the people who will be affected—namely, business.
  So despite the beguiling—I use the word again—and reasonable way in which it was put, with the greatest respect, the amendment is misconceived. I ask the noble Baroness to be reasonable and to withdraw the amendment.
  Baroness Miller of Hendon: The Minister dealt with my amendment in a slightly more conciliatory way than he dealt with some amendments last Thursday. Although I cannot pretend to agree with everything he said, I thank him for his helpful remarks. I shall read them carefully, but meanwhile I beg leave to withdraw.
  Amendment, by leave, withdrawn.
  Lord Dixon-Smith Lord Dixon-Smith moved Amendment No. 66:
  Page 7, line 30, at end insert—
  ("( ) In making regulations under this section the Secretary of State shall have regard to any practical factors which would render any record-keeping requirements unreasonable.").
  The noble Lord said: This amendment stands in my name and that of my noble friend Lord Stanley of Alderley. It seeks to apply reasonableness in a different way. In his previous argument, the noble and learned Lord the Solicitor-General left me precious few chinks into which to drive a wedge in order to deal with the matter. The amendment seeks to apply the test of reasonableness to the drafting of the regulations that the Secretary of State may make. More specifically, it seeks to apply the contents of those regulations. In moving the amendment I have in mind the agriculture and horticulture industries, in which there are circumstances in which, for example, a requirement to record times of starting and ceasing work might be inappropriate.
  In the agriculture and horticulture industries at harvest time, particular the horticulture industry, for reasons of quality control—of which the noble Lord, Lord Sainsbury, who is in his place opposite, will know from the retail end—people work peculiar hours from time to time. Employers may specify a time of day before which employees cannot start work and a time at the end of the day beyond which they may not work. Between those points, people work piece work and will be paid by unit of output. They will often come and go within those hours in quite a random way. They will pop off to take the children to school and again to bring them home. Employees may even pop off—bearing in mind that this is largely in rural communities—to give their husbands lunch. That is not an unusual way of working.
  I remind the Committee that all those practices take place under the requirements of the Agricultural Wages Board. The agriculture and horticulture industries are used to working with a statutory minimum wage. Schemes where the practices work and are used on a regular basis are often already monitored by the board and are generally accepted by it.
  However, there would be a real problem, in such a situation, if there were to be a requirement to put down start and stop times. Perhaps I may illustrate the problem at its most extreme. The biggest employer in the country in this area might have 500 workers at a peak harvest period working for him on a piece work basis.
  I am sorry, I realise that I have been speaking with my hand in my pocket when I am not supposed to. I apologise, it must be because the subject is agricultural.
  An employer might have 500 workers coming and going in fields in various locations, all intended to produce the highest quality produce in the shortest possible time. What the individuals will earn may vary enormously, some will earn at a high rate, some at a relatively low rate, depending on their proficiency, experience and concentration. The test that the Agricultural Wages Board has applied in the past to that type of work is that people should have a fair opportunity to earn the minimum wage within the requisite time. That is at a fair hourly rate. Where the board is satisfied that that is the case, it is all right.
  I return to the point of the amendment, which is to apply the test of reasonableness to the drafting of the regulations. I hope that the noble and learned Lord will treat this request for reasonableness with slightly more sympathy than he did the previous one. I beg to move.
  Lord Falconer of Thoroton: I hope that the noble Baroness and the noble Lord did not misunderstand my reaction to the previous amendment. I treat the requirement of reasonableness with immense and genuine sympathy, but I take the view, as do the Government, and as would any reasonable individual, that the court is not the best body to fix the regulations. Excellent though the courts are, the last thing they are good at is—
  Lord Dixon-Smith: Perhaps I may intervene to say that I did not wish to imply that there was anything unreasonable in what the noble and learned Lord said.
  Lord Falconer of Thoroton: The noble Lord, Lord Dixon-Smith, indicated candidly that by mistake I answered many of his points beforehand. I sympathise with much of what he said. Many of his points are of real importance in determining the form that the record-keeping regulations should take for the purposes in particular of agricultural workers. As he pointed out, we are keeping the Agricultural Wages Board system and the national minimum wage system going together. We recognise that it should be done while placing the minimum burdens necessary in terms of record-keeping on people employing agricultural workers.
  However, for all the reasons I indicated, while we are committed to reasonable regulations on record-keeping, the best way to achieve that is not through an amendment such as this. For all the reasons I gave, conciliatorily I hope, to the noble Baroness, Lady Miller of Hendon, I respectfully ask the noble Lord to withdraw his amendment.
  Lord Dixon-Smith: I am grateful to the noble and learned Lord for his reply which was helpful. Inevitably, we shall need to study it, but in the meantime I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendments Nos. 67 and 68 not moved.]
  Clause 9 agreed to.
  Baroness Farrington of Ribbleton: I beg to move that the House be now resumed. In moving the Motion, may I suggest that the Committee stage begin again not before 8.30 p.m.
  Moved accordingly, and, on Question, Motion agreed to.
  House resumed.

  Fire Regulations, Scotland
  7.28 p.m.
  Lord Howie of Troon Lord Howie of Troon rose to ask Her Majesty's Government whether they intend to alter the building regulations relating to fire in Scotland to bring them nearer to those applying in England and Wales.
  The noble Lord said: My Lords, I do not wish to delay noble Lords hurrying off to dinner but I must begin with a brief apology to my noble friend Lord Sewel on the Front Bench. I did not intend him to have the duty thrust upon him. As he knows, I have been interested in the subject of fire safety over a number of years because of my long-standing connection with the construction industry. I had hoped to discuss my worries with his colleague in the Scottish Office at a meeting. Unfortunately, his colleague declined to meet me and I was then obliged to thrust the burden onto my noble friend, who might have been saved that additional chore.
  I want to refer back to a debate we had in this Chamber on 13th July 1992—a long time ago—when we discussed the changes in the English and Welsh regulations which were in train at that time. During that Unstarred Question debate I referred to the Scottish regulations and the difference between those and the English and Welsh ones and, in passing, the Northern Ireland ones also.
  The main differences between those sets of regulations relate to the periods of fire resistance which have been much longer under the Scottish regulations, and to the requirements for the use of non-combustible building materials in certain parts of buildings where the Scottish regulations are more onerous than are the English regulations were and certainly more onerous than are the revised regulations of 1992.
  The English regulations relaxed both those requirements and, in the course of the debate, it became clear that Scotland was expected to harmonise with England and Wales—oddly enough, not with Europe. In other words, Scotland had to "catch up", as the noble Viscount, Lord Goschen, put it at that time. It is clear that there was a move afoot to regularise the regulations in the United Kingdom, whether or not they were appropriate.
  At that time the other place debated an Early Day Motion which urged that changes in the Scottish regulations,
  "might proceed only after the new departures have proved themselves in practice to Scottish satisfaction"—
  "satisfaction" being the key word. Encouraged by the interest shown by the other place, I asked in that debate for,
  "an assurance from the noble Viscount that no attempt will be made to coerce the Scots in this matter until the Scots are satisfied that the new English regulations have proved themselves".—[Official Report, 13/7/92; col. 88.]
  That struck me as being an eminently presbyterian way to proceed; that is, to go by the evidence and come to a conclusion after the evidence showed itself to be valuable. The noble Viscount was reasonably accommodating. That did not surprise me because he is

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  a very nice young man. He said that the difference between the regulations would be reviewed, but not necessarily removed. That was important. Then he said,
  "It may be decided to monitor the effect of some of the changes … before adopting them in Scotland".—[col. 93]
  By parliamentary standards, that seemed promising. It was not an actual pledge (I will not go so far as to say that); it was not even a promise; but it was a hint, and a hint is a useful thing in parliamentary terms.
  On the basis of that hint, some time later in September 1996, I asked the Scottish Office in a letter what evidence there was to show the greater effectiveness of the fire safety regulations in England and Wales in comparison with Scotland; that is, I was wondering how far, if at all, the process of monitoring had gone and how effective it had shown itself to be.
  As would be expected, I received a polite and informative reply, but it contained what to me was a surprise. Despite the hint regarding the monitoring made by the noble Viscount, Lord Goschen, the letter said,
  "There have been no studies comparing the effectiveness of the two systems of building control with regard to fire safety".
  That took me aback, for the hint—it was not a pledge nor yet a promise—had vanished into the hinterland. Despite the fact that there had been no studies made, harmonisation was going ahead.
  I know, and my noble friend Lord Sewel knows perfectly well, that comparisons are difficult and that fire safety does not only depend on regulations; it depends on many matters. However, one thing seems to be clear. Scotland is safer than England in relation to fire. Why do I say that? Earlier this year I obtained an array of statistics by way of a written reply—a very full reply. Those were analysed for me by the Fire Safety Development Group and the following facts emerged from the analysis.
  There were 5,333 fires in industrial premises in England and Wales in 1966. Those resulted in an average casualty rate of 6.5 per 100 fires. In Scotland there were 552 similar fires in the same period and those resulted in an average of only 4 casualties per 100 fires—a distinct difference. The FSDG concluded that if present trends continued, England and Wales would suffer an increased casualty rate by the year 2000 with 357 casualties. The analysis showed that, were the Scottish rule to be adopted in England and Wales, the casualty list would drop to only 224. In relation to the Scottish statistics, the FSDG estimated that the Scottish casualty rate would also increase slightly, resulting in 23 casualties. Gloomily, it reckoned that if Scotland were to move to the English and Welsh standards, the casualties would increase to 37. An increase from 24 to 37 is substantial and should urge caution on the Government.
  A similar picture emerges from the statistics on wholesale premises. There, too, the Scottish casualty rates can be shown to be smaller than the English and Welsh ones. It is not unreasonable to be convinced that Scotland is safer in relation to fire than England and Wales. No doubt the picture is less dangerous than those projections show because projections may or may not come to fruition—if that is the right word. It is
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  unlikely—I hope I am right in saying this—that the Government will go the whole hog and apply the English regulations to Scotland wholesale. I hope that the changes will be less wide ranging.
  My question is Unstarred and I must therefore ask it: why make the changes at all? Common sense suggests to me that if any changes are to be made at all, they should be made to the English rules in order to make England safer. Since I lived most of my life in England, I regard that as important. In any case, I remind my noble friend Lord Sewel—lest he overlooks this fact—that, with any luck, Scotland will soon have a new parliament. What will it make of the new proposals if they are passed by a Westminster Parliament before Scotland has had an opportunity to make its own judgment upon them?
  7.39 p.m.
  Viscount Thurso: My Lords, I am most grateful to the noble Lord, Lord Howie, for bringing forward this important subject for debate. However, he poses a problem for us in that he has the subject very well in hand. Once he had made his speech and posed his questions there was little that could be said between that and the Minister's response. Therefore, I shall probably not detain your Lordships' for too long. I am also grateful to the noble Lord for having referred me to his Unstarred Question of 13th July 1992 which gave me an opportunity fully to understand the background to his Question today. He has been most rigorous in pursuing the matter.
  I am most certainly not an expert in fire safety or fire regulations. Indeed, until last week, I was fairly happily ignorant of them except in as much as I have had tussles with English fire officers from time to time while trying to gain relaxation of one kind or another in the various hotel developments in which I have been involved. However, once my party decided that that qualified me to respond to the noble Lord, Lord Howie, I made some effort to find out exactly what the subject matter of this Question was about.
  The matter of fire safety is not one that should be taken lightly or with too much humour. I say that because my very first experience of fire safety regulations goes back to the 1970s when a family company which I now own wholly had a hotel just outside Aberfeldy. To our great chagrin the fire regulations were put through and we were forced to spend a considerable sum of money on upgrading the safety of the hotel. However, about three weeks after we had done that we had an accidental fire. Had those regulations not been put through and had we not been obliged to do that work, I am perfectly certain that many of our guests would have died. So, overall, however lightly one may look at some aspects of this matter, the question of fire safety is extremely important and one we should all take very seriously.
  Perhaps I may make one point while going slightly off the subject of Scotland versus England and Wales. What I have noticed when dealing with fire officers in England and Wales is the immense diversity of advice one tends to receive from different fire officers in

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  different areas and the considerable variations with which different fire officers choose to apply the regulations. I am certain they all do it within the latitude which they are given by the law—not for a moment am I suggesting that they step outside the law—but it has always interested me how different fire officers in different areas can make such wide differences of judgment.
  I am grateful to the noble Lord, Lord Howie, for referring me to his debate of 13th July 1992 because I found the answer to my question in the remarks of the noble Viscount, Lord Goschen. He said:
  "The England and Wales approach is based on technical guidance, whereas the others"—
  Scotland and Northern Ireland—
  "set specific technical standards".—[Official Report, 13/7/92; col. 91.]
  While I fully understand that in Scotland and Northern Ireland one knows exactly where one is but one may not be able to do anything about it even if everyone agrees that where one is is not where one ought to be, in England one is able to deal with the regulations in a more flexible manner. I find that on balance, having been an operator both north and south of the Border, it is actually easier to know where one stands without having to debate it with the fire officer. But that is clearly because the approach in England and Wales is based on technical guidance while in Scotland it is based on technical standards.
  The key to the issue is safety. I am able to curtail my remarks because I have kindly been sent the same briefing material that the noble Lord used for giving your Lordships the statistics. I am indebted to Mr. Douglas Smith of the Fire Safety Development Group for those. One phrase in the document struck me:
  "Analysis of the latest Home Office statistics proves that during a fire it is safer to be in Scotland than it is to be in England and Wales".
  If that is the case, then England and Wales should be harmonising themselves with Scotland rather than the other way round.
  Finally, perhaps I may take up the last point made by the noble Lord, Lord Howie, which was eminently sensible. Grâce à Dieu, we are to have a Scottish parliament in the very near future which I believe will be fully empowered to deal with matters of this nature. Therefore, why on earth should the Union Parliament, dominated largely, as it is, by the English, need to bother itself with that? Why not just leave the matter for two years so that we can—me included if I manage to get there—deal with it ourselves?
  7.44 p.m.
  The Earl of Courtown: My Lords, I thank the noble Lord, Lord Howie of Troon, for raising this important issue, particularly with respect to the recent consultation paper, Fire Safety Legislation for the Future, which has been out to various interested bodies. I agree with the noble Viscount, Lord Thurso, that this is a matter of life and death. The statistics quoted by the noble Lord, Lord Howie of Troon, bring home the seriousness of the issue.
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  I know that in England and Wales there is concern over whether there is a need to change the fire regulations. The consultation paper was issued by the Home Office. Surely this should have been done in conjunction with the Department of the Environment, Transport and the Regions, which after all is responsible for the Health and Safety Executive and the building regulations division. Fire safety is a complex interaction between design, management and other processes.
  As far as concerns Scotland, in general the proposals in the paper represent a long-awaited move towards proper fire certification. Rationalisation of the current fragmented fire safety law must be an improvement. Policing of such changes would fall on the fire authorities, which are already under severe manpower and budgetary constraints. Will the Government provide extra funding for these changes? I look forward to hearing the Minister's reply.
  Where existing arrangements in Scotland are adequate, I hope that the Government do not change them just for the sake of change. I would be interested to hear from the Minister the results of the consultation process. How many consultation papers were sent out? Who responded to them and how were they responded to? Did the responses show agreement or did they show concerns? No doubt changes in the fire regulations in England and Wales have been useful. Have those been monitored; and have they been taken into account in the consultation document?
  I shall be most grateful to hear from the Minister any answers he can give me but I am only too willing to have them in writing.
  7.48 p.m.
  Lord Sewel: My Lords, I add my congratulations to my noble friend Lord Howie of Troon on asking what I think is a Question about our intentions. I thank the noble Viscount, Lord Thurso, and the noble Earl, Lord Courtown, for their contributions. All brought a particular perspective to our debate. The noble Earl, Lord Courtown, spoke about fire safety legislation, which is slightly different from the topic we are dealing with in the debate, which is the building regulations relating to fire in Scotland. If I can help him on the points that he raised I certainly will, but I give no assurance on that whatever.
  My noble friend Lord Howie of Troon should not apologise for raising this issue. It is always a delight to hear my noble friend contribute to our deliberations in this House as we know that we will get a well grounded, knowledge-based and learned contribution, as indeed we had this evening. He tried to take me to task for the failure to monitor the difference between the effect of the English and Welsh regulations and the Scottish regulations. I was not expecting that attack. I shall fall back on the tried and tested formula that it was clearly the fault of the previous Administration in that they did not carry out the monitoring that they said they would. No doubt the noble Earl, Lord Courtown, will tell his colleagues of the severe reprimand that they have received this evening.

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  To cut through to the gist of the comments made by the noble Lord, Lord Howie, I believe that he is asking me to say whether we have any intention in Scotland to harmonise down to the English and Welsh regulations. We have no plans to do that. I believe that encapsulates the whole point. It is very well known that there are differences in approach between Scotland and England and Wales. The point has been made that in Scotland there are statutory regulations but in England and Wales matters are based on guidance. I shall not go into the precise differences in the content.
  The point was made by my noble friend Lord Howie of Troon about the case for harmonisation. In a way there is an attractive case to be made there. Clearly, designers wishing to work throughout the United Kingdom have to familiarise themselves with the differences in regulations.
  Lord Howie of Troon: My Lords, that point has been put to me in the past; namely, that designers and architects working throughout the United Kingdom would be obliged to familiarise themselves with separate regulations. I find that very difficult. I spent many years as a civil engineer doing just that. I dealt with the different requirements in England and Scotland and in various other parts of the world. It does not cause the slightest bother. It is quite simple: one just reads the regulations and applies them.
  Lord Sewel: My Lords, I am not at all surprised that my noble friend has heard that argument before. I very much suspect that those who wrote my brief for tonight wrote my ministerial predecessor's brief in 1992!
  I was trying to set up an Aunt Sally which I would then knock down and say that it is an argument that has been advanced in the past. But I find it particularly unpersuasive. There are occasions and cases where it is quite legitimate to have different standards and regulations in different parts of the United Kingdom. As the noble Viscount, Lord Thurso, indicated in the context of a Scottish parliament, that kind of situation may arise more often and across a wider range of topics.
  However, I say quite clearly that there have been recent amendments to Scottish technical standards and they have been relatively minor technical adjustments. They have not sought to bring about the harmonising down which my noble friend Lord Howie indicated.
  The process of harmonisation of the building standards of England, Wales and Northern Ireland is a joint process. In a way it is intended to the extent that harmonisation is attractive. It is intended that the best aspects of each set of regulations are retained. I believe that harmonisation is very much a two-way process. It is our hope that the new approved document will lead to greater harmonisation with Scotland. I use that sense of direction quite deliberately. There may well be a case here for harmonisation to be towards the Scottish practice rather than in the other direction. In this brief contribution I hope that I have dealt with the points made.
  The Earl of Courtown: My Lords, before the noble Lord sits down, does he agree with me that,
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  notwithstanding the comments he made about my speech as regards fire safety as opposed to fire regulations, they are inextricably linked?
  Lord Sewel: My Lords, speaking on the basis of my knowledge and experience, I shall require notice of that question. I take the point. The contribution made by the noble Earl to the discussion was an important one. As I said, I shall come back to him in areas where I can assist. I hope that I have dealt with the various issues raised in the debate.
  Lord Monkswell: My Lords, I hesitate to intervene. I believe that the House will be very glad to welcome the assurance given by my noble friend that the Government and our party, if I may put it on that basis, have no intention of reducing fire safety through the harmonisation of regulations. We have heard similar sentiments from the noble Viscount, Lord Thurso. We do not know which political party is going to be in control of the new Scottish parliament either initially or in the future. Is it pertinent at this point to ask for assurances from the noble Earl, Lord Courtown, speaking for the Conservatives, that his party will ensure that the regulations will not be harmonised downwards and that any harmonisation that that party seeks will be in an upward direction?
  Lord Sewel: My Lords, it is not possible for me to reply on behalf of the noble Earl, Lord Courtown. As regards the point about control of the Scottish parliament, I say to my noble friend Lord Monkswell, ye of little faith. Let us deal with that issue somewhat later in the week.
  Baroness Ramsay of Cartvale: My Lords, I beg to move that the House do now adjourn during pleasure until 8.30 p.m.
  Moved accordingly, and, on Question, Motion agreed to.
  [The Sitting was suspended from 7.57 to 8.30 p.m.]

  National Minimum Wage Bill
  House again in Committee.
  Clause 10 [Worker's right of access to records]:
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 69:
  Page 7, line 31, leave out subsection (1) and insert—
  ("(1) Subject to the provisions of this section, a worker shall be entitled, on written request, to be supplied by his employer with a copy of any relevant records within twenty-eight days of receipt by the employer of that request.").
  The noble Baroness said: In moving Amendment No. 69, I should like to speak to all of the amendments to this clause which stand in my name. I refer to Amendments Nos. 69 to 75 and 77 to 79. This clause involves a matter of major constitutional importance, one which seems to have been totally overlooked by the author of the clause. I do not say that in any recriminatory sense because my honourable friends in the other place also seem to have missed this point. The

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  15 minutes of debate in Committee in the other place were confined to matters of definition and detail about certain aspects of the clause. The purpose of the clause is to give the employee the right of access to records relating to his pay and hours so that he can be satisfied that he has been correctly paid at least the statutory minimum wage. That is wholly unobjectionable and the Opposition unreservedly accept that the employee should have that perfectly proper and reasonable right.
  The constitutional objection arises from the method by which the Government are proposing that that right is to be exercised. It is a method that is totally inappropriate for what is, after all, the pursuit of a civil claim for redress for a financial wrong. It begins with the employee issuing his own search warrant. In Clause 10(5) it is euphemistically called a "production notice". Who else can march into someone's premises without the intervention of a judge or a magistrate and conduct what amounts to a search? The answer is only the Customs and Excise in relation to VAT; the Inland Revenue in relation to certain aspects of income tax, corporation tax and PAYE, and the Department of Social Security in relation to national insurance records. All of those are powers conferred specifically by Parliament to protect the public revenue.
  Under Section 18 of the Police and Criminal Evidence Act, the home of a person in custody for an arrestable offence can be searched without a magistrate's warrant. In the case of civil disputes and claims, there is a mutual right of inspection of documents, but that is in the process called "discovery", given by order of the court under the court rules. There is only one instance where claimants can obtain a unilateral right to inspect, copy and, indeed, impound documents and records from the other party—and that is pursuant to what is called an Anton Piller order. It is given ex parte by the judge without the respondent being aware of it. It is given only at the discretion of the judge where he is satisfied, from evidence on oath, that there is a risk that evidential documents may be destroyed or tampered with and that the interests of justice leave no alternative.
  The order is hedged around with stringent conditions, of which I shall mention just some. The order has to be served on the respondent in the presence of a wholly independent supervising solicitor, experienced in handling Anton Piller orders, who has to see that the matter is dealt with in a proper manner. Where the premises to be searched are likely to be occupied by an unaccompanied woman, unless the supervising solicitor is a woman, one of the persons attending the service of the process must be a woman. The respondent is entitled to ensure that, except for a named person, nobody is present who could gain a commercial advantage from anything that he might see or read; and so on, and so on.
  Perhaps I may repeat—it cannot be emphasised too strongly—that what the Government are proposing is that a person merely has to allege that he has a claim for a civil debt and he shall then have the totally unprecedented right to enter the premises of a third party, and then the right to stay there for virtually as long as he chooses while he conducts a search through that party's books and records. What the Government
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  have proposed in this case is that on 14 days' notice the employee may march into the employer's business premises—
  Lord Falconer of Thoroton: I apologise for interrupting the constitutional flow, but could the noble Baroness identify where the "right" to enter premises comes from, where the "right" to stay in the premises comes from and why if documents are not produced, the remedy is not marching in; it is a complaint to an employment tribunal?
  Baroness Miller of Hendon: If the noble and learned Lord will give me a moment, I shall find the appropriate provision in Clause 10. Subsection (1) states:
  "A worker may, in accordance with the following provisions of this section,—

  (a) require his employer to produce any relevant records; and

  (b) inspect and examine those records and copy any part of them".

  There is no indication of any other way in which the worker may gain access to the records. Indeed, subsection (8) states:
  "The place at which the relevant records are produced must be—

  (a) the worker's place of work; or

  (b) any other place at which it is reasonable, in all the circumstances, for the worker to attend to inspect the relevant records; or

  (c) such other place as may be agreed between the worker and the employer".

  Subsection (9) then refers to the number of days involved.
  As far as I can see, the clause suggests that the worker has the right to enter "the place" and to see the records. I repeat that subsection (8)(b) states:
  "in all the circumstances, for the worker to attend to inspect the relevant records".
  Perhaps I may continue with what I was saying. What the Government have proposed in this case is that on 14 days' notice, the employee may march into the employer's business premises—the noble and learned Lord will not like what I am going to say next because my notes continue—and "ransack" his records. At any rate, it appears that the employee will certainly have a right to look through the records, possibly in front of a shop full of customers. The noble and learned Lord shakes his head, but that is what the clause states. It states that the employee can go into the premises and inspect—
  Lord Falconer of Thoroton: No.
  Baroness Miller of Hendon: The noble and learned Lord will have plenty of opportunity to argue his case when he responds to my amendment.
  Admittedly, subsection (8) refers to a "reasonable" place—again, we have the word "reasonable"—but that is not defined. It will be a brave employer who decides that his solicitor's or accountant's office in the next town or across the other side of London is the most "reasonable" place for that.

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  Admittedly, subsection (7) refers to a "reasonable … time". However, would, say, 9 p.m. or some time on a Sunday afternoon be accepted by a court as "reasonable" even if that is the time that is least disruptive and least embarrassing to the employer, particularly in the case of a shop which may be full of customers at any other time?
  Then, there is all the complicated palaver in this clause about the employee being accompanied by a person of his choice. Who, might I ask, is the "worker's friend" to be? It was suggested in the other place that it might be none other than his Member of Parliament—nothing is impossible, I suppose—or someone from the local citizen's advice bureau. Equally, it could be a large chap with a broken nose and a Rottweiler on a chain whose purpose is to intimidate the employer. I do not believe that this is a laughing matter. There might be a series of visits by one employee after another, without any real cause for complaint as it transpires, whose intent is to disrupt the employer. That may be termed a new form of work to rule. It may even be a local trade union official with a separate agenda who conducts a fishing expedition or a recruiting drive. It could even be a competitor, which would be a very serious matter for any business.
  The very nature of the employer's records, whether kept on a computer or on paper, means that the person who inspects them is likely to see irrelevant confidential information relating to other employees. The essential point is that, unlike the inspection of documents carried out pursuant to a court order in civil proceedings, there is no sanction against improper disclosure of information. There are already situations in which under the Data Protection Act a person can demand to see records pertaining to himself held by a third party. I am entitled to obtain copies of information held about me in almost any computer in the country. One is talking about copies on paper sent by mail or messenger. I am not entitled to barge into my bank, building society or the offices of a credit agency brandishing a do-it-yourself search warrant and accompanied by a personal minder.
  I am entitled to be supplied with a record, in writing, of my treatment in a National Health Service hospital, not by personally inspecting the hospital's and doctor's notes. Under the Companies Acts I am entitled to demand an up-to-date list of shareholders, not merely the possibly obsolete one on file at Companies House in Cardiff. To obtain that information I do not even have to be a shareholder, but I cannot insist on personally accessing the company secretary's computer.
  These are the correct precedents to be followed when considering a demand for copy records to be supplied in writing within a reasonable time and at no cost to the employee. This amendment gives the employee access to all the information to which he is justifiably entitled without all the cumbersome, bureaucratic and inappropriate procedures that this Bill proposes.
  I started moving this amendment by referring to a constitutional issue. With the exception of the cases authorised by Parliament to which I referred earlier, no one should be entitled to demand access to someone
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  else's premises without a lawful warrant granted by an impartial member of the judiciary. I believe that, if an Englishman's home is his castle, so to no lesser extent is his place of business.
  Because of the considerable constitutional importance of this clause I apologise for having taken up so much of the Committee's time in explaining the background to the amendment that I move. As briefly as possible I should now like to explain each amendment in detail. One needs to look line by line at the more objectionable and draconian provisions of this clause. I shall speak to them in the order in which they appear on the list. The proposed new subsection in Amendment No. 69 rectifies a number of deficiencies in the present provision. The present clause does not specify the form that the employee's requirement should take. Can it be simply oral, face-to-face or even by telephone? To require it to be in writing places it beyond argument that the demand has actually been made. I believe that 28 days rather than 14 days is a reasonable time for a notice by an employee, bearing in mind that an employer may have his records maintained by accountants or a PAYE agency or those records may be in the middle of an annual audit. What happens if the employee makes his demand on Christmas Eve, when the entire country appears to have developed the habit of closing down for two weeks?
  I would not dream of diminishing the complaint of a worker who believed that he had been underpaid. However, there is not the degree of urgency that the subsection implies. Therefore, I believe that 28 days instead of 14 days would not make any practical difference. Most important of all, the method by which the employer provides the records should be in writing, not by production on the employer's premises or some other place nominated by the employer under subsection (7). I am sure that noble Lords opposite will be pleased to hear that I do not intend to repeat the arguments that I have already advanced in relation to that point. It is sufficient to say that, as a matter of principle, an employee, or one employee after another, or possibly an employee who has been dismissed for good cause, should not have the right to come back on to the employer's premises perhaps in a disruptive or confrontational manner.
  As to Amendment No. 70, there can be no possible objection to an employee being required to place on record the date on which he makes his request so as to place beyond argument the time from which the time limits prescribed by the Bill begin to run. Nor can there be any objection to an employee specifying the period in which he is interested. There is nothing to prevent the employee specifying the period to be from the commencement of his employment to the present date. Equally, there is no reason why the employee should be required to guess the period which is the subject of the dispute. After all, even a real search warrant issued by a magistrate must inform the recipient specifically as to what the searchers are looking for. This amendment proposes the removal of the right of the employee to demand to come on to the employer's premises or some other place, possibly accompanied by a total stranger whose part in the matter may well be dubious or at least

  1399
  unclear. Instead, the employer is to be obliged to provide copies of the records in writing which the employee and any number of so-called advisers can examine at their leisure. There is nothing in the present clause to prevent a disruptive or vengeful employee keeping the employer hanging around for hours while he conducts a gigantic filibuster and pretends to examine the records.
  Amendment No. 71 seeks to delete subsection (5). That provision gives the employee the unprecedented right to issue what amounts to a home-made search warrant. If the method of providing the records to which the employee is entitled is in writing, by photocopies, and so on, all the paraphernalia of so-called production notices and the procedural regulations in subsections (6) to (8) is entirely superfluous. The amendments that remove those subsections are Amendments Nos. 72, 73 and 74. Subsection (9) is also superfluous because the time limit for providing the written record is covered by the new subsection (1). That is removed by Amendment No. 75.
  Amendment No. 77 substitutes a written request—that is, one demanding copies of the relevant records—in place of the objectionable search warrant which is euphemistically called a production notice. Amendment No. 78 introduces the word "directly" before "relevant" in referring to the records that an employee requires to see in order to establish the employee's pay. The word "directly" is simply to ensure that the employee and his advisers cannot go on a general fishing expedition. What is directly relevant are the hours worked by the employer and what he or she has been paid for them. What is not directly relevant, for example, is what the person working alongside the employee was paid for the same work.
  This amendment is only a matter of emphasis. The employee must get the information that he needs to establish whether or not he has a claim. But what he should not demand is information that is not relevant to that objective. The amendment places a limit on the word "relevant" so that it is not widened to whatever remote piece of data someone can dream up. We do not want to see the harassment of employers by continual, ever-escalating and time-consuming demands for what in civil litigation are called further and better particulars.
  Lord Clinton-Davis: Where does the noble Baroness imagine that the employee would be able to go on a fishing expedition to discover everything and anything that is not relevant? Does not the clause specifically subscribe to the point I have made? The information has to be relevant.
  Baroness Miller of Hendon: It has to be directly relevant to what the employee is looking for. If the noble Lord says that "relevant" states that, he will have no objection to the provision including "directly relevant".
  Amendment No. 79 is a purely drafting amendment. It removes a possible ambiguity which establishes that the "worker" concerned is the one who has put the
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  machinery into motion by making the request in subsection (1). That is precisely what is meant, so why not say so clearly? I beg to move.
  Lord Falconer of Thoroton: I am grateful for the opportunity of perhaps dissipating a number of the misconceptions which underlay the moving of those amendments.
  I think we would all agree that it is of considerable importance that the employee has some right of access to the records of the employer. It would also be sensibly agreed by all that the right of access of that employee should be only in relation to records relevant to establishing whether or not he is being paid the national minimum wage. I should have thought that everyone would agree that he should have no right of access unless he can establish reasonable grounds for claiming that he may not be being paid the national minimum wage.
  I think we would also all agree that the arrangements made for the employee to look at the records should be convenient both to the employer and employee. By that I mean, first, that the employee should in the appropriate case be allowed to look at the records; and, secondly, that where appropriate he should be accompanied by someone who might help explain to him what the records mean. Many of the people wishing to enforce the national minimum wage may not readily understand what the employer's records contain.
  I think we would also all agree that it would be quite inappropriate for the employee to have a right to go into the employer's premises and look around in relation to particular records. We would all agree, however, that some sort of remedy should be given. We need to balance the right of the employer against the right of the employee.
  As regards enforcement of that right, the balance is tipped, if anything, in favour of the employer. The only remedy that the employee has is to go to an industrial tribunal and seek a declaration that the rights given in Section 10 have not been complied with. The only remedy that the employment tribunal can give is to award the employee 80 times the national minimum wage. So the right given to the employee is less than the right given in ordinary civil litigation in this country where a person fails to produce a written document. If the other party does not produce the written document, the person against whom the order is made can eventually be committed to prison. There is no such provision here.
  The fallacy which underlay the whole of the first sequence of the noble Baroness's approach was that the employee could go into the employer's premises and search around for himself. That is wrong. The position is this. A production notice can be given. That requires the employer to do certain things including providing certain documents. If, however, the employer does not comply with that, that does not as a matter of law give the employee the right to go into the premises. It only gives the employee the right to make a complaint to an employment tribunal under Clause 11.

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  Let us assume that I am right on that aspect. The noble Baroness will need time to consider whether I am right in relation to that because of the vigour with which the point was made against me. With respect, that would get rid of the major constitutional problem to which the noble Baroness referred in the first 10 minutes of her opening remarks. Assuming that I am right in relation to that, we should then consider the detail of the points she makes about the way that this right, which we all agree should exist, has been constructed.
  We have sought to achieve a balance between the rights of workers, some of whom, for example, home workers, may be in the more vulnerable position of not having representation or contacts with other firms, and the rights of other employers. We fully accept that the enforcement should not be overburdensome. That is why in subsections (2) and (3) the Bill makes it clear that the right of access is already limited: for example, the worker must have reasonable grounds for believing that he is or has been paid less than the minimum. The intention of this provision is to cut out frivolous or vexatious claims. In addition, the right of access may be exercised only for the purpose of establishing whether the worker is being or has been paid at least the minimum.
  Finally, the worker must produce a written notice—defined in the Bill as a "production notice"—requesting the production of the relevant records. Noble Lords may wish to note that, to this extent, the requirement of the amendments for a written notice to be produced adds nothing to the Bill that is not already there.
  Clause 10 as it stands also allows a degree of flexibility, for example in agreeing a different period—longer than the specified 14 days—for the production of records, under subsection (9)(b).
  Finally, the clause provides for workers actually to inspect records and to be accompanied if they wish. I believe this is an important entitlement which will encourage workers to exercise their rights and discourage some employers who may be tempted to use unfair tactics of dissuasion.
  It is worth emphasising that the overall purpose of this and other enforcement mechanisms is to encourage self-compliance. It is far preferable, if at all possible, to encourage employers to comply voluntarily than to have to provide for a huge bureaucracy to do so. Furthermore, by allowing workers to inspect records it should be possible to prevent cases of simple confusion or misunderstanding. This in itself should help keep cases out of the tribunals and the courts.
  The amendments would significantly weaken the position of the worker for no particular reason. In addressing them, I shall aim to focus on three main issues: the removal, by Amendment No. 56 and related amendments, of the worker's right to inspect and examine his records; the removal of the right to be accompanied; and the lengthening of the time in which records must be produced to 28 days.
  Taking these points in turn, I believe that it is essential to the enforcement provisions for a worker to have the right to inspect records. Of course, in many cases that right will be met by the employer providing
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  the worker with a copy of the records as they relate to him. I imagine that will in fact be the normal way to proceed. However, it is a regrettable fact that some employers may fail to provide the right records or may wish to conceal relevant records. It must be right to enable a worker, in such cases, to go to the source data; and indeed in all other proceedings that right is recognised.
  I do not believe that the Bill allows this right to be abused. I doubt that there will be long lines of employees queuing to inspect their relevant records in person. Subsection (2) already makes it clear that the worker must have reasonable grounds to exercise the right.
  Therefore, the replacement of the right of access with a right to a copy of records would, in my view, unacceptably weaken the enforcement provisions of the Bill.
  This batch of amendments hanging on Amendment No. 69 would also remove the worker's right to be accompanied when examining the records. As already mentioned, this right is essential to prevent some employers from fobbing off their workers or from pulling the wool over their eyes. I do not believe there will be many such cases, but the option to be accompanied provides a reasonable deterrent.
  There is also a pragmatic reason for this provision. Some of the calculations of remuneration for minimum wage purposes may not be at all straightforward. Some workers may feel more confident if they can call on a colleague with particular accounting or legal expertise. The outcome should assist understanding of the position and, to the extent that there may have been an innocent misunderstanding, should encourage early resolution of the problem.
  Finally, the amendments would double the amount of time allowed to an employer to produce the records from 14 to 28 days.
  There seems to be no particular reason for this proposal. It seems to me that any reasonable employer would be able to produce records relating to how much he pays his staff within a fortnight. Subsection (9) of the clause, in any event, allows the worker and employer to agree between them to an extension of the deadline if that is appropriate. So we have already built in more than sufficient flexibility for employers and employees.
  That leads me to Amendment No. 75. Not all the amendments act in the interest of the employer. This amendment deletes subsection (9). It would therefore actually remove the right for the worker and employer to reach an agreement on a longer timescale.
  Other amendments in this batch seem to work in the interest of neither worker nor employer. They simply remove straightforward provisions relating to the period of notice to be given and the location of the records.
  It is clear from the speech of the noble Baroness that all of the amendments are, with the greatest respect, based on a fundamental misunderstanding of the position, which is that it gave the employee the right to walk into the premises. It does not. Once that is accepted the fundamental basis of the amendments goes.

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  I strongly doubt that the removal of such provisions as the latter parts of the amendments does anything but weaken the effectiveness of the clause. As I have indicated, we have designed the clause to be effective in a balanced way; not in order to overburden or punish employers or to give employees rights way beyond what is reasonable. It is in everyone's interests, workers and employers, for enforcement to be fair and, in particular, for enforcement to be effective.
  I hope that I have convinced your Lordships that Clause 10 is perfectly adequate as it stands and that the amendments would not benefit the Bill. I hope that I have set the noble Baroness's mind at rest as to what she perceived, wrongly, as a constitutional outrage. If pressed I would ask the Committee to reject Amendment No. 69, but I would ask the noble Baroness to withdraw the amendment.
  9 p.m.
  Baroness O'Cathain: I have listened with great interest to my noble friend's speech and the noble and learned Lord's reply. I have read through Clause 10 three or four times and I have come to exactly the same conclusion as my noble friend. I am not saying that I have a bright brain, but if I have come to that conclusion surely there must be an element of doubt about it. It is weighted against the employer.
  I am not saying that the legislation should be weighted in favour of the employer and against the employee. I am looking for balance. I understand that the noble and learned Lord has said that balance is being sought, but the wording in this clause causes me to Worry.
  One of the noble and learned Lord's points was that in most cases the employer would produce the information in written form to the employee. Nowhere in Clause 10 does it actually say that that would be an option. The noble and learned Lord said that in most cases it would be a fait accompli, whereby the request would be made in writing and the information would be given back in writing. If so, why are there all these subsections of an intimidatory nature necessary?
  There are occasions in commercial life where employees who might have been dismissed or made redundant have a deep-seated spite against their former employer. They would latch on to this. The place is littered with consultants and lawyers—with due respect to the lawyers present—who would be only too pleased to grab such a case and go to the employer's premises. I wonder why there is this deep-seated regret at not accepting these amendments. It leaves a problem. I am not convinced about the matter. One can imagine the example given by my noble friend of heavies going in with a disaffected employee and causing chaos within an organisation.
  The second point concerns subsection (9)—before the end of a period of 14 days. The Minister drew attention to paragraph (b):
  "at such later time as may be agreed during the period between the worker and the employer".
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  Returning to the point about the Christmas period, we all know that the Christmas period is not 14 days but extends in a lot of cases to three weeks. There would be merit in looking at the 14 days again.
  Viscount Bridgeman: I am the third speaker from this side to feel that this clause does not give protection in a difficult case. Why do we not follow the more usual procedure in the Data Protection Act of the data being produced by the employer? The employer will receive notice. What will he do? In many cases he will have to filter information which is confidential to himself and to which the employee is not entitled. He will have to sift that information from the rest. As to the production of copies, why can they not be produced to the employee as in the Data Protection Act?
  I share the feelings of my noble friend Lady O'Cathain that the presence of a helper is slightly intimidatory, and that could be the case under this clause. I am worried that the production notice is a do-it-yourself warrant. There is no recourse to industrial tribunals in this clause. It gives the employee the right effectively to write his own warrant and go in. That also ought to be tightened up.
  Viscount Thurso: I listened with great interest to the argument, which was not one that I anticipated. Having looked at the group of amendments, I thought that there would be a debate between the two Dispatch Boxes. However, having listened to the comments of noble Lords on the Conservative Benches, I must say that as an employer I do not see the problem that is being put forward. To draw a comparison between a production notice and a search warrant is stretching things a little too far.
  Perhaps I may refer the Committee to subsection (7), which states:
  "Where a production notice is given, the employer shall give the worker reasonable notice of the place and time at which the relevant records will he produced".
  If that provision relates to a search warrant there is something a little odd. The employer is telling the employee after having received a notice where the employee can receive it. I believe that the drafting is not as weak as has been made out and therefore do not wish to support the amendments.
  Lord Falconer of Thoroton: If I believed that the clause legitimately gave rise to the concerns expressed by the noble Viscount, Lord Bridgeman, or the noble Baroness, Lady O'Cathain, I would be equally concerned. However, I genuinely believe that the clause does not give rise to such concerns.
  Perhaps I may deal with the specific points that have been made. Both speeches referred to the document as being a "search warrant". What I regard as the essence of objectionability about a search warrant, like an Anton Piller order referred to by the noble Baroness, Lady Miller, is that it effectively prevents the owner, renter, or occupier of the property entering and looking at his records. There is no element of that in this case.

  1405
  Where a production notice is produced by the employee, the employer tells the employee where the employee can look at the records. It is the employer's choice, so long as he is reasonable, to decide. It does not have to be at the premises; he can choose somewhere else for the employee to look at the records. I draw the Committee's attention to subsection (8), which states:
  "The place at which the relevant records are produced must be…the worker's place of work; or … any other place at which it is reasonable, in all the circumstances, for the worker to attend to inspect the relevant records; or … such other place as maybe agreed".
  Therefore, if the employer has a good case for saying that it should not be the place of work, he can say, "This is a reasonable place for you to come". He has 14 days in which to ensure that the employee sees only his own records and the appropriate records.
  If the employer were minded to disobey the law there is nothing the employee can do except make a complaint to the employment tribunal. The noble Viscount, Lord Bridgeman, said that he saw no reference to an employment tribunal in Clause 10. That is because it is in Clause 11. The noble Viscount, Lord Bridgeman, said that it was intimidatory to allow an employee to bring a companion with him. Think how intimidatory it might be for an employee to be told by his personnel officer, "Here are your records. You sort out whether you have been paid the national minimum wage". I can see that there may be cases in which it might be difficult, but surely a balance must be struck to make the provision work properly.
  I would fully appreciate the concerns if they were justified, but I respectfully submit to the noble Viscount and the noble Baroness, who made good speeches outlining their concerns, that if they look at the provisions they will see that they are properly balanced. They do not constitute a search warrant. They do not allow someone to go mad with someone else's records. However, they represent a sensible means of trying to make the Bill enforceable in a way that does not involve too many lawyers or the employee being easily fobbed off by the employer. And there will be employers who wish to try to deprive employees of their right to the national minimum wage.
  I earnestly ask the noble Baroness to reconsider the points that she has raised. We have thought about them genuinely and sought to reach a balance.
  Baroness Miller of Hendon: I readily accept that the Minister does not have the concerns that I believe he ought to have. I also accept that if he did have such concerns he would deal with them as I have suggested. Therefore, I do not suggest that the Minister does not believe that what he is saying is correct.
  I should like to move on and repeat what the noble and learned Lord said to me. He imagines that in most cases, those things will be dealt with by a copy of the records. That may well be so; but it may well not be so. There is no provision in Clause 10 that suggests that that is the way to deal with the matter.
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  I shall certainly read carefully what the Minister said. But at this stage I should indicate to him that, while I shall withdraw my amendment, I am not particularly satisfied with his answer. He has tried very hard to be helpful but I am not sure I agree with what he said. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendments Nos. 70 to 75 not moved.]
  9.15 p.m.
  Viscount Thurso Viscount Thurso moved Amendment No. 76:
  Page 8, line 19, at end insert ("during the paid contractual working hours of the employee").
  The noble Viscount said: In moving this amendment, I shall speak also to Amendment No. 87. Having listened to the previous debate, which ran for some 45 hard minutes, and was quite fascinating, I am now approaching this amendment from a diametrically opposite point of view. It reflects a general concern that, to a certain extent, employers have the upper hand. I seek to make sure that employees are properly protected and have sufficient access.
  I deal first with Amendment No. 76. In my mind, for reasons which will become plain in a moment, I have nicknamed this the "night porter" amendment, and I shall explain that to the Committee as I go along.
  Clause 10 generally provides a worker with the right to see records and sets out the manner in which and the places at which those records may be produced, specifically through the production notice. Subsections (7), (8) and (9) deal with the how, where and when of that. Subsection (9) in particular deals with when those records should be produced.
  This amendment seeks to add to the burden on employers by providing that the information should be delivered during the paid contractual working hours of the employee. I remind the Committee that I am an employer and I feel slightly schizophrenic because I am never sure whether I am looking at this matter from my point of view or that of my workers. However, I am trying to look at situations when what I do as an employer, my actions, may make life difficult for my employees.
  I then came up with the example of the night porter at Champneys. Let us take him as an example. He begins work at 11 p.m. and finishes work at 8 a.m. the following morning. Those are his contracted hours. If that employee lives 45 minutes away—that is not unreasonable because it takes one into north London—it is quite reasonable to imagine that he is never at Champneys at a time at which it is convenient for the office staff to give him information.
  I believe that it is more important for employees to have the right, particularly if no one else is on duty for those hours, to have available information delivered to them at that point, since I have many other employees who I can engage to make that information available to such employees. That should be done rather than obliging employees, at their own cost, to drive all the way back to come to my premises during my hours of work to suit me.
  This is by way of a probing amendment, but it has a great deal of merit. I hope that the Government will look at it quite favourably. It is important to bear in mind that, whereas the vast majority of employees work relatively straightforward shifts, there are a number of employees in a number of industries who work odd shifts. We should not forget them in looking at what it is reasonable to expect them to do.
  Amendment No. 87 is along the same lines but a little bit different. Clause 14 describes the power of an officer and subsection (3) sets out the way in which that officer may give notice. On a number of occasions I have listened to debates in committee where there has been a definition of the word "reasonable". The noble and learned Lord the Solicitor-General has said on a number of occasions that he does not, under any circumstances, wish to invite a court to decide. He said that that was the last thing that he would wish. And yet Clause 14(3) states:
  "The powers conferred by subsection (1) above include power, on reasonable written notice, to require a relevant person",
  but there is no definition of the word "reasonable".
  In this case it is obviously the notice given by the officer to the employer but it has an effect on the employee. Therefore, we merely seek to suggest that it would be reasonable to define the length of time. Indeed, the amendment suggests that "reasonable written notice" should be defined as a period of 14 days or,
  "at some later time as may be agreed between the officer and employer".
  I should be grateful if the Government would look reasonably sympathetically at both my amendments. I beg to move.
  Lord Falconer of Thoroton: I am grateful to the noble Viscount for raising these two points. I am sympathetic to both principles which underlie the amendments. However, I do not think that they are either necessary or appropriate for the Bill. The purpose of Amendment No. 76 is plain to see, although, as a matter of drafting, it would not achieve its aim. But that does not really matter. I believe that the noble Viscount is trying to introduce the requirement that one must produce records relating to an individual employee during his working hours. Therefore, if the person concerned was the night porter at Champneys, the records would probably have to be produced between something like seven in the evening and seven in the morning.
  I can see the sense of that from the point of view of the employee, although, as an employer, the noble Viscount might be a little irritated if a person in his personnel office had to wait until three o'clock in the morning just to give someone like a night porter his records. We hope that employers and employees will reach sensible agreements as to when this should be done. However, if we insert a provision stating that this must happen during the working hours of the employee, that would be overly prescriptive in a situation where co-operation between worker and employer is so important.
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  On some occasions it may suit both parties to see the records at a time which is outside the working hours of the individual concerned. We do not believe that that should be prevented by law, which would be the effect of the amendment. Therefore, although we are sympathetic to the idea, we believe it to be over- prescriptive. With that understanding, I ask the noble Viscount to withdraw his amendment.
  Amendment No. 87 relates to the power of an enforcement officer in performing his duties to require a person to produce records, an explanation or additional information on "reasonable written notice". So we are now talking about a different clause from that which applies to Amendment No. 76, which relates to the employee's own request where the time is specified. This amendment defines what is to constitute "reasonable written notice" in relation to this power. The amendment says that that would normally be 14 days or, where agreed, up to a month.
  There is nothing wrong in principle with defining the amount of notice required. But, again, as with the noble Viscount's other amendment, we think that it is overly prescriptive. Surely the time will vary having regard to the particular request made. This is not as limited as the individual employee's request: this relates to an enforcement officer. "Reasonableness" is a well understood term and we do not need to tie it down to a specific time frame in primary legislation. Indeed, we do not believe that it would be appropriate.
  The noble Viscount made a rather effective teasing point about the fact that I had repeatedly said that it would be wrong to refer to "reasonableness" in the context of the legislation. When I say that, I am referring to issues where the Minister is producing regulations. In that case, it is not appropriate for the courts to get into the question of reasonableness. However, where we are dealing with the powers of an enforcement officer to give notice to citizens, then it most surely is appropriate that the word "reasonable" should be inserted, so that the very point can be tested by the courts. I should say that that might have been a teasing point rather than a serious one. Nevertheless, I thought that I would answer it. In the light of what I have said, I very much hope that the noble Viscount will feel able to withdraw his amendment.
  Viscount Thurso: Perhaps I may, first, take the noble and learned Lord's last point. It was a little bit of a tease but not wholly so. I am a little worried about the concept that we must not do anything to allow Ministers to be reasonable because they are, so to speak, inherently unreasonable but that somehow or other enforcement officers will always be reasonable. That is quite a dubious and debatable point. However, I do not wish to go into it tonight.
  Lord Falconer of Thoroton: It is because Ministers will always be reasonable but enforcement officers may not that one has to add the word "reasonable".
  Viscount Thurso: I shall accept the tease and move on.
  As regards the response to my Amendment No. 76, there is an important point of principle here. While I am most grateful to the Minister for his response and have no doubt that we are singing off the same hymn sheet, if a slightly different tune—I am singing in descant probably—the point of principle is that it has been my experience that in British industry generally there is a large number of good employers who have superb human resources departments and for whom the vast majority of this Bill is an irrelevance because they pay way above the minimum wage and they play by the book. I remember a few days ago the noble Baroness, Lady O'Cathain, said in this Chamber that British Airways had a 2 per cent. turnover rate. I have been depressed since I heard that because I thought my turnover rate was rather good but it is considerably higher than that.
  There is a certain number of employers—British Airways is certainly one of them—who undoubtedly have great human resources departments and who practise good labour relations. However, I use a phrase that the noble Lord, Lord Currie of Marylebone, used in a debate on management education—despite that head there is a long tail of employers who do not follow the rules and who do not play by the book and who are bad employers. I believe that this legislation is not aimed at my business or British Airways but at those bad businesses who genuinely exploit employees, who pay poor wages, and where poor conditions and bad management conspire to make life pretty intolerable for the people employed. While I have a natural interest, as it were, in protecting employers, in this Chamber my concern is with employees. As regards some of the bad employers, I do not accept that they will necessarily be reasonable. I do not accept that they will not make it difficult for a night porter or a night security guard to exercise his or her rights.
  I shall certainly withdraw Amendment No. 76. However, I appreciate what the noble and learned Lord has said and I wish to read what he has said and perhaps discuss it with him. I totally accept that the drafting of the amendment is wrong. I decided that the drafting was wrong before I rose to speak. I believe I have put the words in the wrong place. I accept that. However, the Government may be persuaded that what I seek to do is not such a bad idea after all. Perhaps at a later stage the Government may even produce an amendment of their own. For the moment, however, I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendments Nos. 77 to 79 not moved.]
  Clause 10 agreed to.
  Clause 11 [Failure of employer to allow access to records]:
  Baroness Miller of Hendon Baroness Miller of Hendon had given notice of her intention to move Amendment No. 80:
  Page 8, leave out lines 35 to 38 and insert ("failed to supply a copy of some or all of the relevant records in accordance with subsection (1) of section 10 above").
  The noble Baroness said: I shall not move this amendment because I believe it is rather closely connected with Clause 10 and a written notice.
  [Amendment No. 80 not moved.]
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 81:
  Page 8, line 40, leave out ("shall").
  The noble Baroness said: Amendments Nos. 81 to 85 seek to modify the totally unyielding provisions on penalties for breaches of this part of the Bill. It seems to be the philosophy of the Government that there should be no discretion whatsoever available to those responsible for administering the Bill, whether it be the Secretary of State in deciding whether there should be any exceptions to the right to receive the national minimum wage or as regards those who are exercising a judicial function in fixing penalties. Other than in the case of someone convicted of murder, every judge and every magistrate has a discretion about a penalty to be fixed. Even in the case of drunk driving, which carries a fixed automatic penalty of disqualification, there is a right for the magistrate or judge not to impose it if there are what are called special reasons, rare though they may be.
  In this case what the Government are asking for is for the tribunal to act as a rubber stamp, with absolutely no discretion to ameliorate the penalties, no matter what the mitigating circumstances might be. I think it would be advisable for the Secretary of State to book a ticket to Strasbourg, where she will undoubtedly soon find herself in front of the European Court of Human Rights if the Bill is passed in its present form.
  Our Amendment No. 82 proposes leaving out the word "shall" in line 40 and moving it to line 41, so that the wording will still be:
  "the tribunal shall make a declaration …"
  But then we propose to insert the word "may"—this is Amendment No. 83—at the beginning of the phrase in paragraph (b); in other words, the tribunal may make an award. It enables the tribunal to make the same declaration as the Bill proposes. It merely alters Clause 11(2)(b) to give the tribunal a discretion as to the amount of any penalty that it fixes.
  Amendments Nos. 84 and 85, when taken together with Amendments Nos. 81 to 83, would now make the whole clause read:
  "Where an employment tribunal finds a complaint under this section well founded, the tribunal—

  (a) shall make a declaration to that effect; and

  (b) may make an award that the employer pay the worker such sum not exceeding 80 times the hourly amount of the national minimum wage (as in force when the award is made) as it considers just and equitable having regard to the employer's default."

  I hope that my putting together into one package all these fragmentary amendments will be of assistance to your Lordships in understanding what I am getting at. It has certainly helped me.
  As the Bill stands, an inadvertent failure to produce a single sheet of paper or a few hours' extra delay or a problem caused perhaps by illness will without consideration of any mitigating factors result in an

  1411
  automatic draconian fixed penalty. On the lowest forecast of what the national minimum wage may be, this could result in a fine in the region of some £288: enough to put a small shop out of business.
  We sometimes read of a person convicted of manslaughter not being imprisoned. Is the crime of not giving a worker his due in an administrative matter so heinous that absolutely no mercy can be shown, no matter what the circumstances might be? Is the Secretary of State frightened that those she appoints to her tribunals might actually apply some common sense in cases where the circumstances require it?
  The final amendment, No. 86, is simply consequential upon some amendments which your Lordships might have considered in Clause 10—but I shall not move that amendment either.
  9.30 p.m.
  Lord Monson: I very much agree with Amendments Nos. 81 to 85 inclusive and I think that the noble Baroness has made out an excellent case, and so there is no point in my repeating the excellent arguments she has already made. Let us suppose that 80 times the minimum wage equates to £280. May I ask the noble and learned Lord, Lord Falconer: can the sum of £280 be set off against gross profits for corporation tax purposes? Secondly, is the £280 taxable in the hands of the employee? Thirdly, is national insurance payable on the £280 by both the employee and the employer? Finally, in the event that the minimum wage for those under 26 or under 21, or whatever the watershed may turn out to be in the end, equates to 90 per cent., let us say, of the minimum wage for older workers, will the sum payable be reduced accordingly?
  Lord Falconer of Thoroton: These amendments, as the noble Baroness has made clear, relate to Clause 11, which concerns the failure of an employer to allow access to records and the awards that can be made by employment tribunals in that event, as well as the period for bringing a complaint. The critical amendment is Amendment No. 83, which removes the obligation for the employment tribunal to make an award to the employer if a complaint is well founded. Instead, it says that a tribunal may make such an award. Amendment No. 84 takes the proposed discretionary power a step further, in that it gives the tribunal the option of awarding less than the full amount, which is currently set at 80 times the hourly national minimum wage rate, to be paid by the employer to the worker. Amendment No. 85 is linked with the discretionary notion, as it gives the tribunal the right to consider what is just and equitable.
  As I explained during the course of debate on Clause 10, the only means of enforcing the right given in Clause 10 is by a complaint to an employment tribunal. The employment tribunal can, if the complaint is well-founded, make a declaration that an employer has not complied with his obligation under Clause 10 and then, in an attempt to obtain enforcement, make an
  1412
  award of 80 times the minimum wage. If the minimum wage is set at £3.60—I do not say that it will be, but if it were to be that—that figure will be less than £300.
  It is slightly unfair and "over the top" to suggest that that is an unreasonable burden on an employer who, by this step, could effectively prevent an employee finding out—
  Baroness Miller of Hendon: That is the minimum. It could be much more.
  Lord Falconer of Thoroton: Not for an individual employee. It would be 80 times the national minimum wage. If the national minimum wage goes up, which I am sure is the noble Baroness's point, it will rise by that amount. It ought to be understood what the scale of the penalty will be. It is likely to remain in the same area.
  Baroness Miller of Hendon: I thank the Minister for giving way again. I do not suppose that he has been in business. His expertise is in the law, and I have great respect for his knowledge. But if you are running a tiny shop and you have difficulty meeting all the salaries on a Friday, this provision could make quite a big difference. All my very modest amendment attempts to do is allow some discretion.
  Lord Falconer of Thoroton: I have been in business; barristers also have to run their business. The noble Baroness may laugh, but barristers start out with no money, and they start out employing people. Barristers, like shopkeepers and everybody in small business, have the option of avoiding the penalty of £300-odd by complying with the reasonable provisions of the law.
  Having the award fixed, which is what the provision amounts to, would enable cases to be handled much more swiftly and effectively in a tribunal. There will be no need for the tribunal to spend time considering specific amounts. At the same time, employers are protected, because a tribunal must first have found the complaint of a worker to be well-founded.
  I believe the balance in this provision is right. It is a reasonable penalty and is the only means of enforcing the order. It is fixed, easy and simple. I respectfully ask the noble Baroness to consider withdrawing her amendment.
  Baroness Miller of Hendon: I am certainly considering the lateness of the hour. Perhaps I may point out that when we originally discussed all these matters we were told that we could have two days to debate them in Committee. I understand that the House is very busy. However, as the noble and learned Lord knows, on Thursday evening we did not begin debating the Bill until late. We certainly did not spend more than five hours on it. The position is the same today. This is our second day for debate, but in effect our second half-day. The Government have offered us another evening next Monday, about which we are delighted. I shall certainly withdraw this amendment, and, undoubtedly, during the course of the evening I shall not move all of the amendments. However, I think it right to say that we on these Benches do not agree with the national minimum

  1413
  wage. We believe in a national minimum income. I have spent many hours on these amendments because I want to do justice to your Lordships and make sure that I put my points forward. One thing I can tell the Committee with certainty is this. For the hours I have put in, no matter what we hear from the Low Pay Commission regarding the level of the national minimum wage, I am not earning the national minimum wage and I suspect that many of your Lordships will not be earning it either. We shall withdraw—
  Lord Carter: Would the noble Baroness speed up if we paid her the national minimum wage?
  Baroness Miller of Hendon: I do not know. I thank the noble Lord the Chief Whip for his kindly intervention. All I would say is that, on Thursday, I withdrew several amendments. There are one or two that I did not move then which I shall wish to bring back on Report. I am sure that the Chief Whip does not intend to give us days and days on Report. I shall withdraw the amendment but—
  Lord Monson: Before the noble Baroness withdraws her amendment, could the noble and learned Lord kindly answer my taxation questions?
  Lord Falconer of Thoroton: I am sorry, in the cut and thrust of debate with the noble Baroness, I completely forgot the questions on tax and I apologise. I cannot give the noble Lord a definitive answer because neither those in the Box nor myself regard ourselves as expert tax advisers. We think that it could be set off against tax, but the noble Lord should not rely on that. It depends on the tax position of the employer, especially whether he is making profits in relation to the matter.
  Baroness Miller of Hendon: I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendments Nos. 82 to 86 not moved.]
  Clause 11 agreed to.
  Clauses 12 and 13 agreed to.
  Clause 14 [Powers of officers]:
  [Amendment No. 87 not moved.]
  Clause 14 agreed to.
  Clauses 15 and 16 agreed to.
  Clause 17 [Non-compliance: worker entitled to additional remuneration]:
  [Amendments Nos. 88 and 89 not moved.]
  Clause 17 agreed to.
  Clause 18 agreed to.
  Clause 19 [Power of officer to issue enforcement notice]:
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 90:
  Page 13, line 36, at end insert—
  ("( ) Any requirement under subsection (2) above shall be stayed pending the determination of any appeal pursuant to subsection (4) of this section.").
  The noble Baroness said: I wish to move Amendment No. 90 and speak also to Amendment No. 91. They are simple amendments which remedy two omissions that simple justice requires your Lordships' House, as the Supreme Court of the United Kingdom, to remedy.
  The amendment to Clause 19(2) provides for a stay of enforcement notice requiring payments of sums which the enforcement officer rules is due from an employer, pending any appeal by the employer. This follows normal precedent in case of civil debt, with the following distinction. If an employer is forced to pay a sum to an employee which is later ruled not to be due, then the normal facts of life make it difficult, if not impossible, to recover it from the employee, who may by then not be able to be found.
  The second amendment is to subsection (7). If the tribunal decides that the enforcement officer would have had no reason to serve an enforcement notice, instead of allowing the appeal it has to rescind the enforcement notice. But by then the employer may have incurred legal and accountancy costs and all kinds of other expenses. The normal rule is that costs should follow the event. If the enforcement officer is as radically wrong as is envisaged by Section 17(6)(a), then the employer should not be left out of pocket.
  The amendment gives the tribunal the widest possible discretion about the amount of compensation to be awarded, including, one assumes, taking into account the fact that the employer may have brought his problems on himself. I beg to move.
  Lord Falconer of Thoroton: Perhaps I may deal first with Amendment No. 90. Subsection (2) of Clause 19 as drafted says that an officer can serve an enforcement notice requiring the employer to pay sums due to the worker because of a past failure to pay the minimum wage. I think we all agree that this is an extremely important provision.
  Equally important, subsection (4) gives the employer the right to appeal against the notice within four weeks of receiving it. The amendment which we are debating would postpone an employer's duty to pay those arrears until the appeal had been heard. Thus, if the employer has been paying below the minimum wage, the worker might have to wait a further period of time before the enforcement officer could serve a penalty notice on the employer. This would plainly invite abuse from employers simply wishing to delay payment of the full amount.
  We have heard that the employer must be treated fairly. And of course the Government agree with that. We have also heard that the legislation is weighted to favour the worker—and we agree with that too. I make no apologies; it is quite right that it should be so. But we must not forget that it is the employer who has the duty to pay the minimum wage. He is responsible for ensuring that he is complying with this law, as with any other law.

  1415
  If an employer is confident that he will win his appeal, because he is sure that he has always paid the national minimum wage, he can choose to pay nothing pending the outcome of the appeal. If he accepts that he was underpaying, but thinks the calculation of arrears is wrong, he should pay what he believes is due pending the outcome of the appeal. In either case he risks being served with a penalty notice imposing a financial penalty for continued non-compliance with the enforcement notice. The only purpose of a penalty notice is to penalise employers who fail to comply with enforcement notices.
  However—and this is the crucial point—while it is true that such a notice can be served where the employer is appealing against the enforcement notice, in such circumstances it is not enforceable until that appeal is finally determined or withdrawn. The employer has the right, under Clause 20, to appeal against the penalty notice as well. And again, if he does so, the penalty notice is not enforceable until the appeal is finally determined or withdrawn. Only if those appeals fail or are withdrawn, will the defaulting employer have to pay the financial penalty. Indeed, if he continues to underpay the national minimum wage he may face criminal prosecution.
  Members of the Committee will note that, in those circumstances, the related Amendment No. 91 would require the DTI in addition to compensate the employer. I will turn to that amendment next. The amendment would require the DTI to pay compensation to an employer in the event of the employer's appeal against an enforcement notice being upheld. The amount would be determined by the tribunal and would include, but would not be limited to, compensation in respect of any legal and accountancy costs incurred by the employer.
  We have heard it argued in defence of this amendment that there needs to be some symmetry of protection for employers and employees; we have been told that, just as the vulnerable worker is entitled to claim underpayments from an employer, so the vulnerable employer should be able to claim compensation if, on appeal, an officer was found to have wrongly served an enforcement notice. But the argument on the basis of "symmetry" is misleading. It is built on false premises, and therefore draws a false conclusion—for it implies that, like a pay dispute, this is a matter of bargaining between employer and worker. But of course this Bill is not concerned with negotiations and disputes, where both sides quite rightly expect equal treatment. The relationship we are constructing is, if you like, deliberately asymmetrical. The purpose of this Bill is to protect the worker from unscrupulous employers; not the other way around.
  The obligation is on the employer to pay at least the statutory minimum. He must be able to prove that he is paying it. The employer must obey the law or face the consequences, and the enforcement officer will, if he has reason to believe that the minimum wage has not been paid, serve a notice.
  We expect enforcement officers will carry out their duties diligently. We will take steps to ensure that they do. So we do not anticipate that there should be many
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  successful appeals by employers. But, if the employer appeals against the enforcement notice, as he is entitled to do under Clause 19, and that appeal is completely successful, the enforcement notice will be rescinded. There is no need for any additional compensation payment to the employer.
  In most proceedings before a tribunal, costs are not awarded. However, were an enforcement officer to act unreasonably in conducting his defence of the enforcement notice in an appeal before a tribunal by an employer, the tribunal rules would already permit the tribunal to make an award of costs against him. To go further is unnecessary. Moreover the proposal begs an interesting question: what should be the consequences for an employer if he is unsuccessful in his appeal? Should he be penalised further? I would not argue so, but that is where the logic of this amendment would take us.
  I believe that the clause works best as it is currently drafted. It reflects the approach taken to all claims to employment tribunals; namely, that costs should not normally be awarded, again to keep the lawyers out. I therefore urge the noble Baroness to withdraw the amendment.
  Baroness Miller of Hendon: I thank the noble and learned Lord for his words. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 91 not moved.]
  Clause 19 agreed to.
  Clauses 21 and 22 agreed to.
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 92:
  After Clause 22, insert the following new clause—
  EMPLOYER'S FAILURE TO PAY CONTRACTED WAGES
  (" . The failure of an employer to pay any wages at all as required under a contract of employment or a contract for services shall not be treated for the purposes of this Act as a failure to pay the national minimum wage and no enforcement procedures under sections 17 to 22 of this Act shall be undertaken in such cases.").
  The noble Baroness said: This proposed new clause seeks to remove an anomaly, or rather a potential cause of injustice, which seems to have been overlooked by the draftsman in framing the Bill. It is not a device to enable an employer to escape from paying the national minimum wage by the simple expedient of not paying any wages at all. He would soon get short shrift from his employees, who would justifiably march out at the end of the first pay day. Such a cumbersome dodge would be totally ineffective because the employer would also find himself in the district court in no time at all.
  No, this is to cover the situation where an employer becomes bankrupt or goes into liquidation or receivership and is unable to pay the wages due to staff who then become preferential creditors. It may take some time for them to receive their wages, even supposing that there are enough realisable assets to do so, especially bearing in mind that the Crown, in the guise of the Inland Revenue and Customs and Excise, is even more preferential and may snatch all the

  1417
  available assets. It would be iniquitous if, having seized the funds available to pay the wages, the Crown were then to prosecute the employer for having failed to do SO.
  It is equally unfair if, following a bankruptcy, the employer's misfortunes were added to by a prosecution. It is true that there are bankruptcies and liquidations which have either a touch of fraud or of mismanagement about them. However, it is not, except in the most blatant of cases, a criminal offence to fail to pay one's debts. When that is the case, other creditors, apart from employees, will be involved. There are also severe penalties available, including imprisonment. In a normal case there is no criminal sanction because the employer has not paid his trade creditors.
  There is no need to make what I may describe as unfortunate employers liable to criminal sanctions because among those ordinary creditors are included employees who, regrettably, missed their last pay day. I am certain that the Government did not intend to create a specially privileged class of creditors where, unlike electricity companies or the local council, a failure to pay results in automatic prosecution. I beg to move.
  Lord Falconer of Thoroton: Amendment No. 92, which on one view is rather breathtaking in its boldness, would have the effect that complete non-payment of wages would not count as failure to pay the minimum wage. Therefore, an employer who paid his workers nothing at all would not be vulnerable to a claim by an individual under Clauses 17 or 18, or to action by the enforcement officer under Clause 19, issuing an enforcement notice, Clause 20, on behalf of a worker, or Clause 21, issuing a penalty notice. Therefore, putting aside a case of bankruptcy or liquidation, the very unscrupulous employer could simply say to his employees, "Look, we are a bit short of money at the moment. Do you mind not being paid anything at all for the next few weeks?", in which case there would be no rights even under the National Minimum Wage Bill.
  This amendment appears to betray to some extent a misunderstanding of how the enforcement provisions of the Bill work. Clearly, the Government's intention is neither to leave a large loophole, so that employers can get away with paying literally nothing, nor to create duplication of claims. I can assure the Committee that the Bill avoids each of those undesirable outcomes.
  Failure to pay the minimum wage is treated as an unauthorised deduction of wages. Action to pursue such a claim may be made under Section 23 of the Employment Rights Act 1996. Instead or in addition, a civil action may be brought for breach of contract. The Employment Rights Act 1996, in providing protection against unauthorised deductions of wages, also protects workers against complete non-payment of wages.
  The amendment is undesirable because it would prevent claims being enforced in the event of failure to pay wages at all. This is a matter of principle. If no wages are paid at all, a worker should be able to pursue a claim under the Employment Rights Act. Where wages are paid below the level of the minimum wage, the worker should again be able to pursue the claim
  1418
  as an unauthorised deduction of wages under the Employment Rights Act. In other words, a worker should be able to recover the minimum wage especially when he is paid nothing and for whatever reason. There should not be any exceptions to this principle and the enforcement rule should apply. I ask the noble Baroness to withdraw her amendment.
  Baroness Miller of Hendon: I shall read very carefully what the Minister has said. I do not recall the number of the amendment that we dealt with on Thursday which touched on a very similar point. Undoubtedly the noble Lord, Lord Clinton-Davis, will write to me on that amendment. At this stage I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Clause 23 [The right not to suffer detriment]:
  [Amendment No. 93 not moved.]
  Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 94:
  Page 17, line 2, after ("by") insert (", or by virtue of, any provision of").
  The noble Lord said: I suggest that we discuss Amendments Nos. 94, 95, 98, 126, 127 and 132 at the same time. The two government amendments, Nos. 94 and 95, are linked tidying-up amendments whose purpose is to ensure consistency and correctness of drafting.
  Each amendment affects Clause 23, which protects workers against detrimental action for asserting rights under the Bill. The effect of Amendment No. 94, which adds the formulation "by virtue of" in Clause 23(3)(a), is to ensure that the rights to which the protection of Clause 23 applies are rights conferred by other legislation which apply for minimum wage purposes by virtue of this Bill; for example, the legislation covering the agricultural wages regimes or regulations made under the Bill, as well as rights conferred directly by the Bill.
  This brings the drafting into line with the new Section 104A(3)(a) of the Employment Rights Act 1996 inserted by Clause 25(1) of the Bill; and the equivalent Northern Ireland provision inserted by Clause 26.
  I turn to Amendment No. 95, which is a drafting amendment in the light of Amendment No. 94. Clause 23(3)(b) currently specifies that the clause applies also to rights under Clause 12. This provision becomes unnecessary because Amendment No. 94 provides for coverage of rights conferred by regulations under the Bill, including regulations made under Clause 12. I hope the Committee will agree to support these minor technical amendments.
  Amendment No. 132 is a tidying-up amendment consequential on the deletion of subsection (5) in what is now Clause 25, which was done by government amendment at Report stage in another place. That subsection (5) would have modified the Employment Rights Act 1996.
  But the prospective modification became unnecessary as a result of Section 12 of the Employment Rights (Dispute Resolution) Act. Subsection 25(5) was

  1419
  therefore deleted by an earlier government amendment, but the corresponding deletion of the repeal entry in Schedule 3 was overlooked at the time. I apologise for that fact, but Amendment No. 132 puts it right. I hope that the Committee can agree to this minor technical correction.
  I turn to government Amendments Nos. 98, 126 and 127. These highly technical amendments reflect changes in the treatment of dismissal procedure agreements made by the Employment Rights (Dispute Resolution) Act 1998, as they affect the protection of employees in Northern Ireland against unfair dismissal for asserting their rights under the Bill.
  Particularly in view of the complicated nature of the amendments, I have written to the noble Baroness and the noble Lord opposite with an explanatory note. I hope that they have received it. I am happy to share this explanation with the Committee and to place it on the record.
  Amendment No. 98 provides a power, in a new subsection (6) in Clause 26, for the Department of Economic Development (Northern Ireland) to make an order to repeal subsection (5), as well as the new subsection (6), of Clause 26.
  Clause 26 deals with protection of employees in Northern Ireland from unfair dismissal for asserting their rights under the Bill.
  Clause 26(5) inserts a new paragraph (2)(d) into Article 142 of the Employment Rights (Northern Ireland) Order 1996 (which provides for "statutory exclusions" in that the statutory right not to be unfairly dismissed does not apply to employees covered by a designated dismissal procedures agreement; but which also provides that the statutory right nevertheless applies in the case of dismissals specified in certain statutory provisions). The effect of Clause 26(5) is to ensure that the right of an employee in Northern Ireland not to be dismissed for enforcing a right under the Bill will be one of the rights that applies regardless of whether the employee is covered by a designated dismissal procedures agreement.
  Section 12 of the Employment Rights (dispute Resolution) Act 1998 provides that there will no longer be statutory exclusions (of unfair dismissal rights) in dismissal procedures agreements. Instead, this will be left to the agreement to determine. Therefore, there will be no need to specify (as, in effect, Clause 26(5) does) that national minimum wage rights are outside those exclusions. Clause 26(5) thus becomes redundant.
  The Employment Rights (Dispute Resolution) Act 1998 applies to England, Wales and Scotland, with corresponding provision for Northern Ireland to be made by Order in Council under the Northern Ireland Act 1974. Once that Order in Council is passed, it will become necessary to repeal Clause 26(5).
  This amendment therefore provides a power, in a new subsection (6), for the Department of Economic Development (Northern Ireland) to make an order to repeal subsections (5) and (6) of Clause 26. The equivalent deletion was made to what is now Clause 25,
  1420
  "Right of employee not to be unfairly dismissed: Great Britain", at Commons Report stage—in their Amendment No. 25 (Hansard of 9th March 1998; col. 229).
  Amendments Nos. 126 and 127 are consequential drafting changes arising from Amendment No. 98. They amend Clause 51(8) dealing with regulation and order-making powers for Northern Ireland.
  I appreciate that these are complicated technical matters but I hope that this explanation, which will, of course, appear in Hansard, which itself is useful from the point of view of interpretation, has clarified the position and the need for these amendments which I ask the Committee to accept. I beg to move.
  On Question, amendment agreed to.
  10 p.m.
  Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 95:
  Page 17, line 4, leave out from beginning to ("and").
  On Question, amendment agreed to.
  Clause 23, as amended, agreed to.
  Clause 24 agreed to.
  Clause 25 [Right of employee not to be unfairly dismissed: Great Britain]:
  [Amendment No. 96 not moved.]
  Clause 25 agreed to.
  Clause 26 [Right of employee not to be unfairly dismissed: Northern Ireland]:
  [Amendment No. 97 not moved.]
  Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 98:
  Page 20, line 30, at end insert—
  ("(6) The Department of Economic Development may by order repeal subsection (5) above and this subsection.").
  On Question, amendment agreed to.
  Clause 26, as amended, agreed to.
  Clause 27 [Tribunal hearings etc by chairman alone]:
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 99:
  Page 20, line 37, at end insert (", unless either party requests that the tribunal be composed of three persons").
  The noble Baroness said: I beg to move Amendment No. 99 and speak also to Amendments Nos. 100 to 102. These are identical amendments to paragraphs in Clauses 27(1) and (2). Clause 27(1) relates to the constitution of an employment tribunal for certain purposes of this Bill under the Employment Tribunals Act 1996, and Clause 27(2) relates to employment tribunals in Northern Ireland.
  The Bill provides for the tribunal for those purposes to consist of a chairman sitting alone. Each of the four amendments provides for either party to be able to request that the tribunal should consist of three persons. Clause 27 deals with complaints against an employer for failing to allow access to records under Clause 11 and appeals against enforcement and penalty notices under Clauses 19 and 22. The Government may claim that they are following the precedent set by the Trade Union Reform and Employment Rights Act 1993 for cases where the input of lay members was considered less

  1421
  essential because the pressure of work and the volume of cases resulted in inordinate delays and the available number of tribunal members had to be spread more thinly.
  The very success and popularity of the tribunal system created a problem that had to be solved in what I believe was a very unsatisfactory way. However, I agree that it was the only practical solution. It may well be that with experience of the operation of the new Act it will be found that extra tribunal members have to be appointed and trained because of the volume of work that it generates. We shall have to wait and see.
  In the Notes on Clauses it is stated that cases dealt with under the sit-alone provision usually turn on legal issues rather than disputes about the facts. We disagree with the Government on whether cases arising under Clauses 11, 19 and 22 are more likely to involve legal issues than factual ones. We believe that they are more likely to be factual than legal, or at least to have a greater factual than legal element. Did the employer fail to produce some or all of the records that he was required to? Did he fail to give the employee some or all of his right to inspect? Did he refuse access to such person as the worker may think fit? Did he fail to comply with an enforcement notice? Has the time for an appeal against it expired?
  I agree that in appeals under Clause 22 the permitted grounds are much more legal than factual. Nevertheless, they contain a substantial factual element as well. The important point is not whether we or the Government are right but the perception of the parties. An employer may well feel aggrieved by being bombarded with threatening notices that he believes are unjustified, or he may be threatened with drastic penalties when he believes in all good faith, and reasonably, that he has complied with them. Similarly, an employee may feel aggrieved that he has not received his full entitlement and that his employer has used all kinds of obstructive tactics against him. In either case one party or the other will want his day in court. Where the issue is one of fact he will want the satisfaction of having been heard by a form of jury.
  One cannot rely on a single chairman exercising a discretion as to whether to enlarge the tribunal. Human nature being what it is, most chairmen with the qualifications that they need simply to be appointed to the post will feel themselves perfectly capable of handling cases on their own. Pressures on chairmen to clear their list will discourage them from adjourning to call in lay assessors cases that have started and have already taken time to reach the top of the list.
  Courts, whether they be the mighty High Court of Justice or simple employment tribunals, exist for the benefit of litigants, not for the convenience of the judiciary—even less for the financial problems of the Treasury which has to pay judges. It is not for the Government to decide how judicial matters in these cases should be handled. If a litigant believes that his case deserves a full tribunal and makes a claim for one early enough in the proceedings then justice demands that he should have one and not be left with a grievance that he has not had a fair hearing.
  It is perhaps relevant to note that under Section 4(3)(e) of the Industrial Tribunals Act 1996 parties who face a three-person tribunal can opt for a chairman sitting alone. In those cases, the parties in effect are given a choice. There is absolutely no reason why parties in cases under this Bill should not have a similar right; or why they should suffer a lesser right.
  These simple amendments serve only to improve the working of the Act. They do not detract from the principles of the Bill. I urge the Government to accept them.
  Lord Haskel: I listened carefully to what the noble Baroness said. However, the parties to a dispute already have the right to ask for three persons to hear the case, but it is the chairman who decides. The Employment Rights (Dispute Resolution) Act deals with this matter in some detail. It was a Private Member's Bill introduced by my noble and learned friend Lord Archer. He made it clear that the Government are committed to the tripartite nature of the tribunal system. Despite the noble Baroness's comments, perhaps I may take this opportunity to repeat that commitment. The two lay members can and do make a valuable contribution through their experience of employee relations in the workplace. This is much appreciated and in my opinion underpins the value of industrial tribunals.
  The kind of cases where such workplace experience is particularly valuable are those involving, for example, unfair dismissal or victimisation. Other clauses in the Bill protect workers against such victimisation for asserting their rights under the Bill. Complaints to tribunals on such grounds must be heard by a tribunal of three. There is no discretion for the chairman to sit alone in these cases. This rightly reflects the existing practice in relation to matters of this sort, where the two lay members can bring their own experience to bear.
  However, as the noble Baroness said, there is a different level of cases where, in my view, the role of the lay members is less relevant. These are typically technical cases and cases which hinge upon a point of law. The chairmen of those tribunals are always legally trained. There are three types of cases which Clause 27 adds to the "sit-alone" tribunals. The first such case relates to a complaint by a worker that his employer has failed to produce relevant records to enable the worker to check, for example, that he has received at least the rate of the minimum wage. It seems to me that this question is essentially a straightforward matter of fact. Either the employer has produced the records in question; or he has not. It seems unlikely that there would be dispute on that score.
  The second such case relates to an appeal by an employer against the imposition of an enforcement notice by an enforcement officer. To succeed in such an appeal, the employer needs to show that the officer had no reason to serve the enforcement notice—for example, because the worker in question was self-employed; that there had not been any underpayment of the minimum wage; or that the specified underpayment was incorrect.

  1423
  The question here is essentially, in my view, a matter of technical legal judgment. The decision which the tribunal will be called to make will rest on whether those criteria are met in the case in question.
  The third type of case which Clause 27 adds to the "sit-alone" list is an appeal by an employer against the imposition of a penalty notice for failure to comply with an enforcement notice. The grounds for successful appeal in this case are similar to those for appeal against an enforcement notice—and in my view turn essentially on technical, legal issues.
  In theory, the amendments which the noble Baroness has tabled would not prevent these three types of cases from being heard by the chairman sitting alone. This is because the effect of the amendments would be to make it compulsory to convene a tribunal of three, if either of the parties requests it. The consequence would therefore be to remove the chairman's discretion to decide whether to convene a tribunal of three. There is flexibility in the system which Clause 27 establishes, and in the whole system of "sit-alone" provisions which Clause 27 supplements. In every case where the chairman is required to sit alone, he retains discretion to decide to convene a tribunal of three. We feel that it is satisfactory to leave that to the discretion of the chairman. The existing legislation—the Industrial Tribunals Act, Section 5(4)(c)—makes clear that the chairman must have regard to any views of the parties before exercising his discretion to convene a tribunal of three—but the decision remains the chairman's. These amendments would remove the chairman's discretion. We have absolutely every confidence in the expertise of the chairmen of these tribunals.
  In practice, the amendment would probably compel the three members of the tribunal to sit in nearly every case of the type covered. That is not necessary or desirable. That is the purpose of providing the chairman with the discretion which these amendments seek to take away. With that in mind, I hope that the noble Baroness will withdraw her amendment.
  Baroness Miller of Hendon: I listened carefully to what the Minister said. I do not agree with him but, due to the lateness of the hour, I will most certainly withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendments Nos. 100 to 102 not moved.]
  10.15 p.m.
  On Question, Whether Clause 27 shall stand part of the Bill?
  Baroness Miller of Hendon: Although I gave notice that we were going to oppose Clause 27 standing part of the Bill, due to the lateness of the hour I shall not
  1424
  speak to that Motion this evening. However, I would not like the Minister to infer that I am happy with the clause. I most definitely am not.
  Lord Clinton-Davis: The noble Baroness is not happy with the Bill.
  Baroness Miller of Hendon: The Minister is absolutely right. I am not at all happy with the Bill. I am doing my best to improve it, not only for the benefit of employers but for employees and employment generally.
  Clause 27 agreed to.
  Clause 28 [Reversal of burden of proof]:
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 103:
  Page 21, line 6, leave out ("qualifies or, as the case may be, qualified") and insert ("does not qualify or did not qualify").
  The noble Baroness said: I shall speak to Amendments Nos. 103 to 105. When I spoke on Clause 10 I referred to a major constitutional issue. Another such issue arises from this clause which the marginal note unashamedly describes as the reversal of the burden of proof. In other words, in civil proceedings the plaintiff is not required to prove his case: not to the criminal standard of beyond reasonable doubt, not even just to the civil standard of the reasonable balance of probability. All the complainant has to do is to make an allegation, however fanciful, however far-fetched, misconceived or even malicious. The employer has to prove his innocence.
  It is worth noting that nothing in Clause 28 refers to the words "reasonable belief" or "in good faith". The noble and learned Lord, Lord Falconer, has taken issue with me on several occasions over those words but on this particular occasion they do not appear.
  No more, innocent until proved guilty. What is the reason for the reversal of the judicial tradition that we are proud to have given to the rest of the world? Interestingly enough, the DTI gave the game away in an outburst of candour in its notes to the Bill. It said:
  "It should ensure that those remunerated at a rate below the national minimum wage can more easily succeed in claims to recover any underpayment".
  In other words, away with the concept of equality for all before the law. No level playing field. Perhaps it is more than symbolical that the scales on the figure of Justice outside the doors of this Chamber have not been replaced despite having been removed years ago. One of our attendants told me they were stolen.
  What is the explanation for this totally unjustified and biased departure from the normal standards that we expect in our courts? It is because old Labour still lurks behind certain ministerial desks in the DTI, harbouring caricatures of an employer being a cigar-smoking plutocrat with his foot firmly planted on the neck of a grovelling Bob Cratchit. I readily and immediately acquit the noble Lord, Lord Clinton-Davis, of that characterisation. If I am wrong I am sure that the Minister will tell me that his experience as a solicitor, a Member of Parliament and a Minister in a former

  1425
  administration as well as in the present one, and as a distinguished public servant in Brussels, means that he undoubtedly knows the realities of the business world.
  Neither do I include the noble Lord, Lord Simon of Highbury, in my stricture about lack of perception of the nature of the present relationship of employers/employees, even though he is apparently not participating in our deliberations about minimum wages. As a distinguished industrialist, he, too, undoubtedly is well aware of the balance that exists between both sides of the negotiating table. Nor do I include any of the Ministers sitting opposite me on the Front Bench.
  If your Lordships think that I am exaggerating the attitude of unreformed old Labour to employers, let me quote what the Minister of State at the DTI told the Committee in the other place. He stated:
  "For far too long, low paid workers, who have little or no representation, had found it impossible to do anything about their employment status or to gain access to basic minimum rights in the labour market".
  Later in the same debate, he went on to say:
  "I am putting the case not only for the Government but for millions of workers who, over the years, have not had the opportunity to make their voices heard".
  Millions of workers? Surely, that is a slight exaggeration.
  First, the type of employer who is most likely to become embroiled in disputes over the minimum wage is not some giant corporation or even the Government's bêtes noires, a well known fast food retailer or various so-called security firms providing the services of glorified nightwatchmen in some kind of uniform. No, it would be the owner of the village store; the high street mini-market struggling against discounted petrol and other what they call "loss leaders" but what is probably predatory pricing.
  What does the small businessman have ranged against him under this present Bill? Under Clause 14, the employer can call on the assistance of a state funded enforcement officer. He has the power to require the production of records, furnished in the presence of the officer's own witness, including the complainant, with an explanation of the records and other information. And most sinister of all, this officer has the power to enter an employer's premises without a warrant. I beg the indulgence of the noble and learned Lord, Lord Falconer, for repeating what I said earlier, because I still believe it.
  If that is not enough, this enforcement officer has the power not only to require the production of records at such time and place as the officer chooses, but also to summon the employer into his presence to be further interrogated. It should be noted that the Bill does not give the employer the right to be supported by his own adviser.
  Furthermore, there are the powers of the employee under Clause 10 to require the production of records under a home-made search warrant, euphemistically called a production notice, and for the employee to be entitled to be accompanied by such other person as the employee may think fit; perhaps a solicitor or someone
  1426
  from the local citizen's advice bureau or, I was even going to add, someone from Rent-a-Thug with a degree in GBH!
  In Committee in the other place, the Minister, in a flood of eloquence which says something for his stamina at 2.30 in morning, posed a series of rhetorical questions. He asked:
  "Where does the information come from? Who maintains the records? Who has information about remuneration and emoluments? Who maintains records about National Insurance and PAYE? Who maintains records about employees?".
  In answering himself, he said, "The employer does". Maybe so, but, as I have pointed out, the employee, together with his ally the enforcement officer, has draconian powers to secure access to those records. That is apart from the fact that the information should be in the possession of the employee without all these searches and interrogations and the need for the employee and the enforcement officer to be accompanied by a minder. The basic information which surely every employee will know is how much he is being paid and how many hours he has worked.
  Perhaps it is relevant to ask the Minister who the officers will be. Clause 13 gives the Secretary of State the power to appoint them and to second them from other government departments. Will they be trained accountants? Will they be tax inspectors made redundant as a result of all this self-assessment? The point is that they will be paid for at the public's expense. We have not been told how much it will cost, or perhaps we have and I have just missed it in all the reading that I have done. Their function will be to support the employee to construct a case against the employer unless the employer can convince them that there is no case to answer. In other words, their function is to presume that the employer is guilty unless he can positively prove the contrary.
  Let us look at a possible scenario for the sake of argument. Let us assume that the minimum wage is fixed at the entirely improbable figure of £1.20 per hour. I did not wish to suggest a figure which would give an idea to the Low Pay Commission as to what is should be. Let us suppose that the employer pays £1.50 per hour but the employee, who is paid in cash, as is sometimes customary in this country, alleges that he has received £1.05 per hour and that the employer's PAYE records are fictitious because the employer has pocketed the difference. Perhaps the Minister will tell me how the employer is to discharge the onus of proof. Is it suggested that in future, every small employer, in addition to all the records he already has to keep—tax, PAYE, National Insurance, VAT, self-assessment, and records under the Companies Act—must also demand a receipt every pay day?
  One of the ills which the Government are undoubtedly trying to remedy is that of contrived arrangements which, by some device or other, turn someone who is clearly an employee into a so-called self-employed individual. That can certainly operate to his detriment as regards legal rights, employment protection rights, health and safety and so on. On this side of the Committee, we entirely support anything

  1427
  which will remove such abuses. But that does not require the sledgehammer which the Government are now proposing.
  The Inland Revenue has a simple test to decide whether or not someone is bona fide self-employed. All the enforcement officer needs to do is to obtain evidence from the person's records at the tax office. The Government's excuse for that reversal of a fundamental constitutional concept and right is that the employer is in a dominant position vis-à-vis the employee. But as I have shown, it is the opposite in this case. With all the power of the state and its enforcement officers, the employee is in the dominant position as regards procuring evidence and information.
  My honourable friend, the Member for Ashford, said at the opening of the Committee debate on this clause in the other place that he had thought originally that the Government's reasons for reversing the burden of proof were obscure, but having read the DTI notes, he knew that they were daft. We are not allowed in this Chamber to indulge in such flamboyant language. However, I should like to think that I have discharged the onus of proof in demonstrating that the clause is both unnecessary and unreasonable. I hope that the Committee will support the long-established rule of law by accepting the amendments which restore the burden of proof to where it belongs; that is on the complainant. I beg to move.
  Lord Newby: The noble Baroness referred very elegantly to the judicial tradition which she used in support of her argument. It is fair to say that the Industrial Relations Act 1971—the first time that the employee had a cause of action against an employer for unfair dismissal—provided that the burden of proof rests with the employer, not with the employee, to show that the reason for the dismissal was fair.
  In that case there was a much more draconian range of powers than appears in this Bill. It seems to me that the Bill is merely continuing the tradition established by the Conservative Government in 1971. They saw, rightly, that in the kind of dispute that we are talking about, unless the burden of proof were reversed, there simply would not be a level playing field and the balance of forces would be cast unfairly against the employee.
  It seems to me that exactly the same applies here. I too am an employer. I keep records of what I pay the people who work for me. By and large, I do not pay them in cash. If I were to do so, I suspect that I should require from them a receipt to show how much cash I had given them. Even if I were handing over cash as opposed to paying by cheque or direct debit, the thought that I would somehow do that without any records or in a way that would leave me open to dispute is ludicrous. I cannot believe that as a matter of general principle and practice that employers are doing that.
  I apologise for detaining the Committee on this matter but I have not spoken before this evening. I feel very strongly that this is an issue where a principle has been established in an Act introduced by the administration
  1428
  of the noble Baroness's party. Therefore, it is appropriate for the tradition which that Act established to be continued in this legislation.
  10.30 p.m.
  Lord Falconer of Thoroton: Despite the enthusiasm with which the noble Baroness produced her extremely eloquent and effective speech, if one thought a little about why it was that the burden of proof had been reversed one would realise that there were quite good reasons behind it. The noble Lord, Lord Newby, referred to the Industrial Relations Act 1971 which was introduced by a Conservative Government. It placed the burden upon the employer to establish that a dismissal was fair. The reason it placed that burden on the employer was plainly that it would be the employer who would have the detail relating to that person's employment and the circumstances in which he was dismissed.
  The approach taken by the 1971 Act is one used repeatedly in civil law. The latter has always been able to construct arrangements whereby, in circumstances where the answer to a particular problem is more likely to be in the hands of one party than another, it will place the burden of proof on that other person rather than the plaintiff. With respect to the noble Baroness, Lady Miller, the burden of proof in criminal cases should not be confused with that in civil cases.
  What does this legislation do about the reversal of the burden of proof? First, it places the burden on the employer to establish whether an individual qualifies for the national minimum wage; and, secondly, it places the burden of proof on the employer to establish that the employee has been paid the national minimum wage. That is whether the claim is brought for an unauthorised deduction before an employment tribunal or whether the claim has been brought to enforce a contract claim where it is said that the worker is not paid the minimum wage. With great respect to the noble Baroness, that would seem to be quite sensible.
  As far as concerns people who might be making claims for the national minimum wage, very many of them will be in a moderately vulnerable position. Many of them may be isolated from other workers; for example, they may be out-workers or home workers, completely without assistance, and indeed sometimes not very well able to express themselves in English. As a matter of principle, what is wrong with them being allowed to go to an industrial tribunal and say, "I don't believe that I have been paid the minimum wage; I appear to be getting a very small amount of money"? If the noble Baroness had her way, the employer would simply say: "Prove that you are an employee first of all, and prove what you have been paid". The employee would then say, "I can't remember the terms upon which I was actually employed and I can't tell you what I have been paid over the years because I'm paid on a piece rate".
  Surely in such a case the sensible course is that the employer comes before the tribunal and provides the material showing the basis of employment or the relationship between the worker and the employer,

  1429
  together with the figures as to what that person has been paid. A balance must be struck somewhere. The burden has to be placed on one or the other. Which is the more sensible place to put the burden? Is it on the employee in trying to enforce the national minimum wage or is it on the employer? The obvious answer seems to me to be on the employer. If he has a complete answer to the case, he will be able to say, for example, "This person is not an employee", or "I paid the national minimum wage". He will be able to do so much more easily than would be the case with the employee.
  I find the suggestion of the noble Baroness—namely, that this is some sort of constitutional affront—impractical, misguided and alarmist. I suggest that she should think again about the basis of the amendments that she has tabled. She should consider, as a matter of practicality, where the balance should properly lie. In my respectful submission it is clear that the reversal of the burden of proof in relation to these two matters is sensible and practical. I respectfully ask the noble Baroness to withdraw her amendment.
  Baroness Miller of Hendon: Despite the beguiling way in which the Minister responded to that point, he did not respond to the following point. Nowhere does Clause 28 state—I searched hard—that the employee either has reasonable grounds or is acting in good faith. We have often used those terms during the course of this Bill. The Minister appears to be saying it is quite obvious that the burden of proof should be on the employer. I believe it is much more obvious that the employee should at least have reasonable suspicion to believe he has not been paid the minimum wage. After all, he will be given his money with a pay slip. However, due to the lateness of the hour, I shall withdraw the amendment. However, I give the Minister notice that I shall return to the matter. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendments Nos. 104 and 105 not moved.]
  On Question, Whether Clause 28 shall stand part of the Bill?
  Baroness Miller of Hendon: For the same reason as I have just mentioned I shall not oppose the Question that Clause 28 shall stand part of the Bill at this time of night.
  Clause 28 agreed to.
  Clauses 29 and 30 agreed to.
  Clause 31 [Offences]:
  Baroness Seccombe Baroness Seccombe moved Amendment No. 106:
  Page 22, line 18, leave out ("delays or").
  The noble Baroness said: In moving Amendment No. 106 I wish to speak also to Amendments Nos. 107 and 108. I wish to follow the line of my noble friend. As drawn, this part of the Bill worries me greatly. The Bill will give to what is described as an "officer"—and an officer is probably an official appointed by the Secretary of State, or seconded from a local authority—powers to demand information and compliance with his orders. In reality, Clause 31 as drawn deprives the
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  employer of the elementary rights enjoyed under our law in respect of other matters—criminal matters. We should remember that the remedies given to an aggrieved employee are essentially to secure a civil right to recover a civil debt; a debt incurred as a result of a right to a statutory rate of pay. But this part of the Bill provides for criminal sanctions and criminal penalties not available to the ordinary civil courts except after a court order and after proceedings for contempt of court.
  The Bill creates a new criminal offence of "contempt of officer"; an offence which deprives the employer of defences that are available to the most violent criminal prisoner. Clause 31(5)(a ) makes it an offence to delay or obstruct an officer. We do not object to the word "obstruct". We have tabled Amendment No. 106 because we object strongly to the word "delays". "Delays" is not defined. What happens if an officer demands information or whatever and the employer says, "You will have to make an appointment or wait while I consult my solicitor"? Is that a delay? If so, that is to be an offence. Our Amendment No. 107 seeks to require the officer to exercise his powers reasonably. The word "reasonable" keeps appearing throughout the Bill. We have already had a number of debates on the word "reasonable". The Committee will be pleased to hear that I do not intend to go over that ground again.
  However, I remind the Committee that as regards the criminal offence of obstructing a police officer in the course of his duty, the police officer must prove not only that he was exercising a legal duty, but that he was doing so reasonably. A police officer cannot complain if, contrary to any requirement of his, a suspect insists on exercising a legal right of his own.
  Finally, Amendment No. 108 seeks to insert the word "wilfully" to qualify "neglect". Again, the Government are seeking to create an absolute criminal offence with no defence. "Neglect", according to the Oxford English Dictionary, means "to fail to do". An employer may neglect—that is fail—to answer questions, furnish information or produce any documents simply because he has forgotten or does not know the answer or because he does not have the documents. This iniquitous provision even deprives an employer of the right to silence that is still among our constitutional safeguards in criminal cases, notwithstanding recent changes in the law.
  What the provisions in this section that we wish to modify seek to do is to create powers that are not available to the police and to subject a person guilty of the offence of being an employer to penalties, sanctions and procedures not available to the police when investigating a suspected serial killer. It is constitutionally essential that your Lordships introduce a sense of rational perspective and proportionality into this part of the Bill. I beg to move.
  Lord Falconer of Thoroton: I agree that these provisions in the Bill should be balanced. We think that they are and are at the right level to achieve enforcement.
  Let me deal with Amendment No. 106 first: to take out the word "delays" in relation to Clause 31(5)(a). We are not talking here about an employer's inability to pay,

  1431
  which will be covered by a different part of the clause. The fact is that an employer will be obliged to pay at least a minimum wage, and refusal or wilful neglect to do so will be an offence under subsection (1) of Clause 31. Rather, the provisions which are the subject of this amendment are designed for where an enforcement officer asks an employer for something to ensure compliance with the Act.
  The focus of the provision is on the word "intentionally". We are not suggesting that an employer who accidentally happens to be out, for example, when the enforcement officer calls should be guilty of an offence; but employers who systematically or deliberately seek to frustrate the enforcement officer in pursuing his duties should not be allowed to get away with it. I do not think that the noble Baroness who so eloquently moved this amendment would disagree with that proposition.
  That is the purpose of this provision and that is why we think that the amendment would be inappropriate. It would have the effect of removing one complete section of protection against the employer who seeks systematically and deliberately to obstruct the enforcement of the Act.—
  Baroness O'Cathain: I thank the noble Lord for giving way. Surely delay is obstruction.
  Lord Falconer of Thoroton: If the noble Baroness is right, what is the objection to having the word "delay" in? There would certainly be scope, I am afraid, for lawyers to regard "obstruction" as being something different from "delay", and if the person deliberately delays the officer from enforcing, there should surely be some sanction. At the moment I cannot really see the argument for not including it.
  Baroness O'Cathain: I am concerned about,
  "intentionally … obstructs an officer acting".
  If somebody was delaying something for six or eight weeks, that would be covered. There could be another form of obstruction by making sure they were not allowed into the premises—that is, physically allowed in. I just feel it is tautological.
  Lord Falconer of Thoroton: I entirely respect the noble Baroness's intervention but, with great respect, I do not feel that she is right because obstruction is one thing and delay is another. I shall certainly think about the drafting aspect, but I do not believe, if the point made by the noble Baroness, Lady O'Cathain, is right, that there is a point of principle between us. Indeed we are all singing from the same hymn sheet in relation to this.
  Baroness O'Cathain: I was trying to be helpful.
  Lord Falconer of Thoroton: I regard it as a most helpful intervention. I am sorry to have looked a gift horse so horribly in the mouth, but I do not think we are in considerable disagreement in relation to it.
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  The noble Baroness moved her amendment on a slightly different basis. She had understandably been affected by the rhetoric of the noble Baroness, Lady Miller of Hendon, and saw constitutional outrages all over the shop. I do not think that is the right approach.
  I now turn to Amendment No. 107. Again, it is intended to deal with enforcement officer offences, if I may so call them. Amendment No. 107 would require enforcement officers to exercise their powers in a reasonable way. The Opposition have sought to introduce the "reasonable" test at a number of points at different times during the Bill's consideration. As with the other attempts, we believe that this one, too, is inappropriate and should be resisted.
  Our basic premise is that we would expect enforcement officers to act reasonably within the framework of the powers conferred upon them. That must be the basis of all enforcement. If, however, an officer fails to act in a proper manner, it is likely that he will be acting outside the terms of his power in Clause 14. I fear that a specific "reasonable" test would add nothing. It would add a further explicit hurdle, no doubt of great interest to the legal fraternity, which could make it more difficult for an enforcement officer to act speedily. At worst, it might only be of benefit to non-compliant employers trying to find ways to avoid their obligations.
  I hope in the light of the assurance that I have given regarding Clause 114, the noble Baroness will feel reassured in relation to the absence of the word "reasonable" on that occasion.
  The last amendment in this group is Amendment No. 108. On the face of it, that would appear to have some merit. The current drafting of the Bill would make it an offence to refuse or neglect,
  "to answer any question, furnish any information or produce any document when required to do so",
  by an enforcement officer. The amendment would apply the higher standard of "wilful" neglect in a failure to comply with such requests.
  I say that the amendment would at first sight appear to have some merit, because it would apparently mirror the offence of a refusal or wilful neglect to pay at least the minimum wage. However, such a comparison would be ill-founded. The reason is that we are dealing with two very different circumstances.
  Throughout the Bill we have wanted to create a fair balance between the rights of employers and workers. In particular, we have set the high standard of wilful neglect for the criminal offence of failing to pay at least a minimum wage. That is because we would not want to see employers being punished through accidental failure. We recognise that in this connection accidents may happen. We recognise in particular the reality that in relation to the sometimes complicated matters of determining pay and pay reference periods, there is a possibility that accidental errors will be made, particularly during the running-in period of the minimum wage.
  However, the circumstances envisaged by this provision are quite different. It seems to me that there can be little, if any, room for misunderstanding or

  1433
  accidental error where an enforcement officer has asked an employer a question or had requested him to do something, such as produce records, and the employer has not answered the question or has not produced the records. I therefore believe that wilful neglect in this context would be an unreasonably high standard to prove. On a practical level, I understand that it might be extremely difficult to prove a wilful neglect to provide information.
  Clearly, we do not want to penalise accidental failure or oversight. But it is important to catch the non-accidental or "accidental on purpose" cases. If this amendment is pressed, I therefore advise the Committee to reject it. In those circumstances, I very much hope that the noble Baroness will not feel bound to press her amendment or move Amendment No. 108.
  Lord Burnham: Before the noble and learned Lord sits down, is it not the fact that the inclusion of the word "wilful" in Amendment No. 108 entirely justifies the arguments made by my noble friends with regard to Amendments Nos. 106 and 107? We are talking about somebody who deliberately fails to observe the conditions laid down in the Bill. By the use of the word "wilful" the noble and learned Lord might consider accepting all three of these amendments, bearing in mind that they are a trio and are totally interrelated.
  Lord Falconer of Thoroton: I have dealt with each amendment individually. So far as the word "wilful" is concerned in Amendment No. 108, the Government's view is rightly that if a person refuses or neglects to answer any question, it is hard to see that that will not be wilful. In relation, for example, to refusing to answer a question, the concept of "wilful" is very difficult to apply. That is not the case in relation to not paying a wage. There, it could be believed, bona fide, that the right wage was X, but they have got it wrong. There, it would be right to make it a criminal offence only where a person wilfully neglects to pay the minimum wage; that is, that a person knows that he should be paying X, but pays Y. We think that the payment situation is different from such a thing as refusing to answer a question. That is why there is a difference and why we think not inserting the word "wilfully" is appropriate.
  Baroness Seccombe: I reject the words that I was infected by my noble friend. I was convinced by her excellent arguments. It is always a pleasure to listen to the warm and reasonable words of the Minister, but I need to read them in detail. Therefore, at this stage I beg leave to withdraw Amendment No. 106.
  Amendment, by leave, withdrawn,
  [Amendments Nos. 107 and 108 not moved.]
  Clause 31 agreed to.
  Clause 32 agreed to.
  Clause 33 [Proceedings for offences]:
  [Amendments Nos. 109 to 111 not moved.]
  Clause 33 agreed to.
  Clause 34 [Agency workers who are not otherwise "workers"]:
  Baroness Miller of Hendon Baroness Miller of Hendon moved Amendment No. 112:
  Page 24, line 9, leave out from ("principal") to ("and") in line 12.
  The noble Baroness said: I wish to move Amendment No. 112 and speak to Amendment No. 113. These amendments leave out paragraphs in Clause 34 which would have the effect of making an employer who engages an agency to perform functions for his business responsible for the payment of the national minimum wage to those agency workers. This is not only iniquitous but it turns the whole law of agency on its head. An employer might engage a firm of industrial cleaners to clean his premises for him. He might engage a firm of caterers to operate his works canteen. He might engage a specialist firm to operate a particular piece of equipment, for example, one of those tower cranes that we see on building sites. He may use temporary staff from one of the secretarial or employment agencies such as Manpower.
  The employer, the principal if you will, is definitely not the employer of the agency worker. It is the agency who is the employer. There might be cases in the law of tort where the principal could be held liable for the wrongful acts of the agency worker, but that is not because he is the employer but because he is directing his work and actions.
  The principal has no part in the contract between the agency worker and the employer. The principal does not pay him his wages, indeed, often he will not know what they are because the agency will not want the principal to know what its profit margin is. The principal is not responsible for deducting the employee's PAYE or national insurance or for holiday or sick pay. If there is a breach of health and safety regulations, it will be the agency, as his employer, who will be responsible for any damages or criminal penalties, although the principal might in some circumstances be jointly liable. For all those reasons it is wrong to involve the principal in the financial and contractual arrangements between the agency worker and his real employer.
  The Notes to Clauses suggests that the reason for the provision is that,
  "It may not be apparent whether the agency worker is working for the agent or the third party".
  That is nonsense. The employer is the person with whom the contract of employment is made and from whom the worker should have received his statutory written memorandum of employment terms, actually called his contract of employment. The employer is the one who actually pays the worker's wages and deals with PAYE. This may not be the person who physically hands over the weekly pay packet because it is conceivable that the agency may well ask the principal to do that for it. The simple act of handing over a pay packet on behalf of the agency, as the agent of the agent, in fact, cannot make the principal the employer. If the provision of Clause 34(2)(b) really means what it says, then I fear that some agency workers may not get their

  1435
  pay packets early on a Friday while the employer, possibly in an armoured car, makes the rounds of the various sites.
  But there cannot be the slightest doubt in the worker's mind who his actual employer is, especially if he is also wearing some kind of uniform. What if the agency worker performs duties for several principals during the week or during the day—quite a common situation, especially in the industrial cleaning business? What if he does not even perform the duties for the principal on the principal's premises—in a letter shot, mailing or dispatching the principal's goods, for example?
  A simple look by the employee at his PAYE records and pay slips will soon clear up any doubt in his or her mind as to who is his employer. There is no justification for involving the principal who has genuinely contracted out some activity in the pay and conditions of the agency's actual employees. There is no justification for treating genuine agency arrangements, which have long been a regular, entirely proper and indeed sometimes entirely necessary commercial arrangement, as though they were some sort of evasion device.
  Agency contracts were in use long before this Bill was ever dreamed up. Whatever problems the clause seeks to resolve with regard to defining self-employed persons, disturbing normal agency arrangements will not resolve them. Nobody but nobody should be made responsible for the performance of the legal obligation of someone else under this Bill by this shotgun approach. The solution is to remove the paragraph, for which these amendments call. I beg to move.
  Baroness O'Cathain: I support this amendment, and do so from practical experience. I must declare an interest in that I am a principal, and have been for the past eight-and-a-half years, in an agency employing nurses. In relation to the nurses I employ, I hand out the money at the end of every week and they have no idea of the amount of commission that I pay to the agencies—I have had several over this period. That amount ranges from 20 per cent. to 42 per cent., depending on the agency and the efficiency thereof.
  When I read through the Bill I was pretty horrified at the idea that I could be responsible and could be regarded as such because I am the principal. We must think long and hard about this. It is not only the crane drivers who are involved; there are thousands of people in the same situation as myself, particularly in homecare for disabled people. It will cause a lot of angst and a lot of anxiety when people realise what is happening through the Bill.
  Viscount Thurso: This clause gives me cause for concern if what the noble Baroness says is correct. Perhaps I may therefore put a question to the Minister.
  Suppose I employ, say, the Busy-Bee cleaning agency to come in to clean my office and I have a specific contract with the proprietor of the Busy-Bee
  1436
  for my office to be cleaned. He then supplies various workers who come to do that job and in those circumstances I do not pay them or give them any money but have a contractual arrangement with the company and pay that company. Under this clause am I in any way liable for being responsible for the minimum wage?
  Lord Clinton-Davis: With respect, there is a misunderstanding of the position affecting this clause. It is because the agency sector is highly complicated that we decided that Clause 34 should represent a belt-and-braces approach, ensuring that where there is an uncertain position relating to the contractual status of agency workers—because it is not clear whether there is a worker's contract with either the agency or the principal—such workers will, nevertheless, be covered by the Bill as though such a contract exists. That is the purpose of Clause 34.
  Clearly, the likelihood is that the majority of agency workers will be covered automatically by the Bill, regardless of Clause 34. They will have the status of a worker by virtue of the contractual arrangement with the agency or with the agency's client, whom the Bill identifies as the principal. The vast majority of agency workers are likely to have a contract of that kind. Clause 34 is designed to cover those uncertain or grey areas; it is a fall-back position.
  Sometimes the existence of a contract is undoubtedly questionable. Where a contract does exist, it may not always be apparent with whom the contract has been entered into and the employment status of the agency worker may itself be unclear. I hope that there will be very few cases where agencies seek to find ways around their responsibilities under employment law, but it is possible. It is for that reason that Clause 34 exists.
  I turn immediately to the specific amendment, Amendment No. 112. I do not have very much to add to what I have already said. The effect of the amendment would be to make Clause 34 unworkable. I cannot think that that is the noble Baroness's objective. The effect would be to exclude precisely those individuals whom the clause is designed to bring into the Bill in the first place; that is to say, it would exclude agency workers who fall into grey areas where it is unclear whether or not they have a worker's contract with the agent or with the principal. I hope that the noble Baroness will not pursue Amendment No. 112 as it would negate the whole purpose that I have been alluding to.
  Amendment No. 113 is an interesting amendment but it is wholly inconsistent with Amendment No. 112. It relates to Clause 34(2), which, in the absence of a worker's contract, defines the person with whom the agency worker is to be regarded as having such a contract. Clause 34(2)(a) provides that the contract is regarded as being with either the agent or the principal, depending on which of them is responsible for paying the agency worker. Clause 34(2)(b) provides that where neither the agent nor the principal is responsible for payment, the contract is to be regarded as being with whichever of them actually

  1437
  pays the agency worker. The effect of Amendment No. 113 would be that the agency worker would be regarded as having a worker's contract in all cases with the agency—in the absence of such a contract or, in case of doubt, as the person with whom it was held.
  I give the noble Baroness this—the amendment does have the advantage of simplicity. However, the difficulty is that it would also mean that even where it is understood by all concerned—the agency, the principal and the worker—that the principal will pay the worker, it will be the agency that will be legally responsible for paying the worker the national minimum wage. I am not sure that the noble Baroness would wish to suggest that that is a satisfactory or desirable outcome. It is a highly difficult and technical matter and it is important because there is a growing tendency for some organisations to use agency workers to provide flexibility. Although the use of agency workers provides significant advantages for the client company, the uncertainty of the employment status of the worker can at times lead to a lack of legal protection for the worker.
  As far as concerns Clause 34, it is of value to bear in mind that the standard agency worker arrangements will not be affected either by the clause as it stands or by the clause as it would be amended by Amendment No. 113 because those agency workers will in any event be workers under the general definition in Clause 54 and it will be clear from the contract who is responsible for paying the minimum wage.
  I do not deny that there is some merit in the argument adduced by the noble Baroness. As I said before, it has the virtue of simplicity and it would make it easier for agency workers to identify the person from whom to claim; namely, the agency. That would ensure that agencies could not use the clause as a loophole to put the onus on the client, or "principal" in the Bill's terms, to pay the minimum wage. There could be some advantage in that. But it is difficult to judge the extent of the benefit because it is difficult to judge the likelihood of an agency being able to get away with such a course of action. I believe that this is an issue which is finely balanced. I am grateful to the noble Baroness, Lady Miller of Hendon, the noble Baroness, Lady O'Cathain, and the noble Viscount, Lord Thurso, for advancing the matter for debate. On balance I believe that the clause provides a better outcome as drafted. The amendment would go too far unnecessarily by interfering too much in existing arrangements.
  When we drafted the clause we sought to reflect the reality of what happens now. Sometimes the principal may clearly have the responsibility for paying the wages and in such cases the obligation to pay the minimum wage would and should rest with the principal. In other words, an agency worker may be paid either by the agency or the client, as the noble Baroness said. It makes sense in assuming the existence of a contractual relationship to follow that flexible practice and to assume that the obligation to
  1438
  pay the minimum wage lies with whoever is responsible for payment or, where that is unclear, with whoever makes payment.
  The clause as drafted also meets the problem of arrangements involving more than three parties—that is to say, where more than one agent is involved. The criterion for deciding who is legally responsible for paying the minimum wage is whoever is responsible for paying or whoever actually pays the wages at present, as I have indicated.
  Finally, I believe that it is right and sensible, when drafting legislation, to err on the side of caution. While there are arguments in favour of Amendment No. 112, I do not believe that it is possible to predict all the effects of making the changes proposed. While Amendment No. 113 would offer a workable arrangement, on balance the way in which the clause is drafted is preferable. Therefore, I ask the noble Baroness to consider what I have said and, in the circumstances, to withdraw the amendment.
  Baroness Miller of Hendon: I shall consider very carefully and read very carefully everything that the noble Lord has said. At first, I thought Clause 34 stood the law of agency on its head and I could not see any merit in the clause. I have listened carefully to what the noble Lord has said and I shall read carefully what he has said. I suspect that we shall want to return to this matter because I believe that there is much more merit in our very simple amendment. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 113 not moved.]
  Clause 34 agreed to.
  Clauses 35 and 36 agreed to.
  Clause 37 [Armed forces]:
  [Amendment No. 114 not moved.]
  Clause 37 agreed to.
  Clause 38 [House of Lords staff]:
  Lord Clinton-Davis Lord Clinton-Davis moved Amendment No. 115:
  Page 25, line 17, leave out ("contract of employment") and insert ("worker's contract").
  The noble Lord said: Amendment No. 115 relates to Clause 38, which applies the Bill to staff of this House. I am glad that we have reached it tonight. As the Bill stands, Clause 38 applies only to such staff who are "employees"—that is to say, staff who have a contract of employment with the Corporate Officer of this House.
  The clause was originally drafted in this way to reflect the present reality, confirmed by the House authorities, that all staff of this House in fact have employment contracts. However, partly in the light of views expressed in another place, the Government have in the meantime reflected further on this clause. In particular, they have considered it preferable to treat staff of the other place and this House on an equal footing. Clause 39 differs from Clause 38 in applying to workers who are not employees, as well as to employees. It is also considered more prudent

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  to ensure that the law reflects not only the present reality but is also capable of applying to any reasonably likely future arrangements. It is not, of course, any part of my responsibilities in government, but I believe it is not completely out of the question that some individuals might be engaged to do work in this place under arrangements other than a contract of employment.
  It is for those reasons that the Government have tabled Amendment No. 115, which I ask the Committee to support. I beg to move.
  On Question, amendment agreed to.
  Clause 38, as amended, agreed to.
  Clauses 39 and 40 agreed to.
  Lord Haskel: I beg to move that the House do now resume.
  Moved accordingly, and, on Question, Motion agreed to.
  House resumed.
  House adjourned at eleven minutes past eleven o'clock.