Lords Sitting of 27 March 1998

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

The Lord Chancellor: Leave of Absence
The Lord Chancellor (Lord Irvine of Lairg): My Lords, before the commencement of business I take the opportunity to inform the House that I am to host a welcome luncheon for the Prime Minister of China on behalf of Her Majesty's Government on Wednesday, 1st April. Accordingly, I trust that the House will grant me leave of absence on that day.

Prime Minister (Ecclesiastical Functions) Bill [H.L.]
11.6 a.m.
Lord Alderdice: My Lords, I beg to introduce a Bill to make provision for the alternative exercise of the ecclesiastical functions of the Prime Minister when that office is held by a person who is not a member of the Church of England. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Lord Alderdice.)
On Question, Bill read a first time, and to be printed.

Electricity Generation Bill [H.L.]
Baroness Maddock: My Lords, on behalf of my noble friend Lord Ezra, 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 di scharged.—(Baroness Maddock.)
On Question, Motion agreed to.

Mental Health (Amendment) (No. 2) Bill [H.L.]
11.8 a.m.
Lord Rowallan: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Rowallan.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 1 [Strategies for the provision of in patient facilities in psychiatric units]:
Lord Rowallan Lord Rowallan moved Amendment No. 1:
Page I, line 8, at end insert ("and other 24—hour nursed hed—).
The noble Lord said: This amendment came about as a result of the Second Reading of this Bill and provides for 24—hour nursed beds to be available in each health authority. Both Sane and the National Schizophrenia Fellowship support this amendment. I am pleased to say that the Mental After Care Association also supports it. Mind, which has not liked Clause 1 of this Bill up to now, accepts it is a good idea for area authorities to have an appropriate strategy both in the context of in—patients, who are well catered for in this Bill, and those needing care in the community.
This Bill does not deal with out—patient care at all. But I give Mind and all the other charities concerned a firm commitment that in the absence of a new mental health Act being revealed shortly, I shall tackle the issue of out—patients and care in the community soon. To this end I look forward to the proposed Green Paper on mental health reform which is due at the beginning of April but which I gather has now been delayed. I ask the noble Baroness, Lady Ramsay of Cartvale, to inform this Chamber when she now expects it to be published.
It has to be significant that all the psychiatrists I have spoken to—after all, they are in the front line of mental healthcare—support this clause and its amendment. We should remember that there is a one in 10 chance of someone contracting the dreadful illness of schizophrenia. It does not respect wealth, colour, creed or geography as the statistics are the same the world over. Schizophrenics who either do not respond to, or comply with, medication pose particular problems to mental health services. For these people 24—hour care and nursing support within a safe, therapeutic environment is a necessary and important stage of this care.
This amendment has become even more important as a result of the recent Bournewood ruling in the courts stipulating that any patient unable to give informed consent must be detained on a section of the Mental Health Act. This of course dramatically increases the number of patients because it now takes into account all those with Alzheimer's, learning difficulties, etc., who need 24—hour care as they will be detained by law. I beg to move.
Lord Thurlow: I support this amendment. If the Bill were to become law it is manifestly important that it should cover the whole range of beds, including those in 24—hour nursed units. In that connection, it would be helpful if the Minister could give us an indication of what progress has been made with the creation of 24—hour nursed units for which we had high hopes two years ago when the previous government introduced the measure. However, we realised that there were difficult problems with regard to resources.
The noble Baroness in her forceful statement on Second Reading—I regret I was unable to be present—made it clear that it was not strictly necessary to

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introduce primary legislation at this stage to achieve the specific object of the Bill, and that under existing law the authorities are under an obligation to make strategic reviews and plans. Equally, there are obvious disadvantages in tackling this particular area piecemeal when we hope and believe that the Government are on the point of addressing the wide range of urgent and necessary issues. I accept that we cannot expect this Bill to reach the statute book, but that does not make the debate any less useful. It is a long time since we had a general debate of any kind on this urgent social question on which Parliament and the public have been for so long, and are still, exercised.
We look forward to the report to the Minister of the independent reference group and the Government's Statement. There has been considerable confusion arising from conflicting reports of the Government's immediate intention to close the big hospitals. We need clarification. It is not the fault of the present Government that they are landed with an immensely difficult, almost insoluble, problem of the discrepancy between resource and requirements. Nonetheless that makes it necessary to get on with the most urgent issues. I submit that all sides of the House have indicated that the issue of the closure of beds is perhaps the most urgent.
Lord Alderdice: The Bill results from the dismay felt by the noble Lord, Lord Rowallan, when it became apparent to him that there was great difficulty in acute in patient psychiatric facilities. It has occurred over a period of time as we have attempted to move from the widespread treatment of patients in acute in patient beds to care in the community. That in itself is a laudable and welcome development.
However, the resources left behind in the acute hospitals, and the concentration of disturbed people there, have led to considerable difficulties in the management of acute in patient beds. The concern of the noble Lord is shared widely by those who work with people in acute in patient facilities in psychiatric hospitals throughout the country as they become increasingly worried that the experience of in patient care is much less therapeutic and more custodial—something we hoped we had left behind a long time ago.
However, there are other reasons why acute in patient beds have become blocked. This became apparent as we looked into the matter. It is particularly apparent in the review paper published in the British Medical Journal some time ago by Shepherd and his colleagues. It is pointed out that one of the reasons why many people stayed in acute facilities is not that other facilities in the community were not readily available but because other residential facilities, properly manned by specialised care workers, were not available. That is why the Royal College of Psychiatrists has begun increasingly to talk about 24-hour nursed bed units in the community. Those are not a half-way house between acute psychiatric care and community care but facilities which provide the necessary expertise and containment appropriate for people in that setting.
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That is why, in the light of further exploration and concerns expressed that the Bill would point people back into acute psychiatric facilities rather than out into the community, the noble Lord, Lord Rowallan, has brought forward the amendment. I heartily support it. I believe that it has increased overall support for the Bill. I beg noble Lords heartily to support the amendment.
11.15 a.m.
Earl Howe: I, too, support the amendment. My noble friend and the noble Lord, Lord Alderdice, have set out the arguments for it most ably. I wish only to reinforce and develop one or two key points.
The main criticism of Clause 1—it was rehearsed by some noble Lords at Second Reading—is that by focusing on the requirement to provide in patient facilities it unhelpfully skews the emphasis of patient care away from community provision and towards in patient beds. In other words, by singling out one aspect of the continuum of care for mental patients one is somehow damaging the balance of care available to such patients and distorting the overall allocation of resources.
There are two answers to that point. First, one of the main reasons that my noble friend felt moved to introduce this Bill is that there is a clear need to right what is already an imbalance in the system. As the noble Lord, Lord Alderdice, emphasised with tremendous authority at Second Reading and again today, many people in need of in patient care are not receiving it. Often they are not receiving it because available resources are being over concentrated on community provision. No one is arguing, least of all my noble friend, I am sure, against the principle of community care. Community care—thank goodness—is here to stay and we must do all we can to foster and support it to ensure that it works well. But if we believe, as I do, that community care is not the whole answer and that there are those who need looking after either short or long term in surroundings where professional help is continuously to hand, we need to focus more on how current shortcomings in that area can be addressed.
The second rebuttal to the criticism of Clause 1 is surely this. The clause speaks of the requirement for health authorities to prepare a strategy for in patient care. I do not believe that that formulation allows one to argue that health authorities are thereby being discouraged from preparing strategies for other services. On the contrary, the provision of a strategy for in patient beds should relate directly to a local needs assessment and be part of the much wider planning process which predicts and meets demand for mental health services and for support services generally, including housing and primary care.
The amendment seeks to insert a specific mention of 24 hour nursed beds into the definition of the facilities for which health authorities have a duty to plan. The need for 24 hour nursed beds relates particularly to those people with schizophrenia and other severe mental illness who either do not respond to, or perhaps more frequently do not comply with, their prescribed

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medication. Those patients represent a serious problem to the health service. For them quick access to a safe and secure environment in a hospital bed, or its equivalent—so long as it has 24 hour nursing support—is a vital part of treatment. The amendment strengthens Clause I, and I support it.
Lord Lyell: I wonder whether the Minister or any noble Lords who have spoken could give me some assistance over the definition of a 24 hour nursed bed, compared to in patient facilities. Otherwise, perhaps they could tell me where I might look for information. I have had only one brief experience of the subject; many years ago, with my noble friend Lord Trefgarne, I visited the state hospital at Carstairs, with which the noble Baroness may be familiar. Perhaps the noble Baroness or my noble friend, or perhaps even the noble Lord, Lord Alderdice, could point me in the direction of a precise definition and set out what are the aspects of a nursed bed. I am learning a great deal from this debate and from all the work that my noble friend has done on this Bill. I should be grateful if the Minister could assist me, either during the debate today or in the future.
Baroness Ramsay of Cartvale: During the debate at Second Reading, I spoke in some detail about why the Government are unable to support this Bill. I shall not rehearse all those arguments again. Suffice it to say that the Government do not favour piecemeal changes to a complex piece of legislation such as the Mental Health Act. Significant changes to the legislative framework should, in our view, be taken as part of a full review of the Act. I can confirm that we are considering the need for such a review, and will take into account the views of all interested parties.
The noble Lord, Lord Rowallan, asked me whether a Green Paper would be published. My honourable friend Mr. Paul Boateng is taking a long, hard look at mental health and all related services. Nothing has been agreed yet, and discussion of the plans is therefore premature. At the appropriate time plans for mental health services will be looked at in the light of the comprehensive spending review, and we will set out our plans to build a new basis of confidence in our mental health services, making sure that we secure the welfare of those with a mental illness while safeguarding the public.
At that point, it will also be important to share our ideas with experts and professionals, as well as users, and to hear the range of views. We are committed to ensuring that the right structures, the right staffing, the right care systems, and the right legislation are in place. We are firmly committed to building those elements of effective mental healthcare and to building public confidence.
With the addition of the proposed amendment, Clause 1 of the Bill would now refer to two elements of services where the noble Lord, Lord Rowallan, would like to see specific action: separate in patient facilities and 24 hour nursed beds. In response to the noble Lord, Lord Lyell, I shall attempt, perhaps inadequately, to give a definition based on my understanding of 24 hour nursed beds. These beds are not necessarily in hospitals—they could
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be in special homes or hostels—but they are covered by 24 hour nursing care. I see the experts nodding, so I think I have the definition right.
The noble Lord, Lord Thurlow, asked me specifically in his very interesting and well—received intervention what progress has been made in introducing 24—hour nursed beds. I am happy to say that some progress has been made. That has been assisted through targeted funding under the Mental Health Challenge Fund, which increased the number of such beds by 200. A further review of provision has recently been undertaken and we shall publish the results in due course.
To return to the amendment, separate in patient facilities and 24 hour nursed beds are just two elements of a range of local services which we expect to see in health services strategic plans and available to vulnerable mentally ill people. The Government already support the concept of 24 hour nursed beds. Other elements include: acute hospital beds; hostels and supported housing; occupational rehabilitation; secure provision; crisis care intervention; day care; and a full range of effective treatments.
It is vital that health authorities should retain the flexibility to commission and develop services within government priorities and guidelines but according to local need. The original clause, and the proposed amendment, would severely restrict their capacity to do so. The Government therefore do not consider that there would be any merit in enshrining these provisions in legislation. Therefore we cannot support the amendment.
Lord Renton: I regret that the Government do not support the Bill. I was interested to hear that the Secretary of State is to consider the previous legislation on this matter. I wish to draw attention to the fact that both mental illness and mental handicap are covered by the present legislation. I hope that the Government will bear in mind that, whereas mental illness is often curable, mental handicap is quite incurable. People who suffer from mental handicap should be kept quite separately, in different types of hospital or other places, from those who are mentally ill. Will the Government bear that clear distinction in mind?
Baroness Ramsay of Cartvale: I note very carefully what the noble Lord has said. It will be on record and I am sure the Government will take it into account.
Lord Mottistone: In supporting this Bill, perhaps I may leave with the Minister the thought that the Bill's purpose is to ensure that there is accommodation for people who need it, and that they are not left out in the community when they should not be there. There are far too many instances where accommodation is not available for them. The noble Lord, Lord Alderdice, made these points specifically. I hope that the Government will pay particular attention to the noble Lord's contribution to the debate and to the remarks of other noble Lords.
It is all very well taking a long time to sort out what needs to be done about possible amendment to the Mental Health Act 1983—which would probably be a

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very good thing—but if in the meantime we have disasters because people are inadequately cared for in the community, and they do some harm either to themselves or others, then the Government are failing. Perhaps the Minister will encourage her honourable friend Mr. Boateng to get on with it and do something positive quickly. Then, Bills like this will not be required.
Lord Swinfen: Before the Minister replies, perhaps I may support the point made by my noble friend Lord Mottistone, but emphasise that such accommodation should be supervised. Very often, patients who are mentally ill can leave hospital and live in the community; but where they are on medication, if that medication is not supervised and they do not take it, their condition deteriorates. They can become dangerous to themselves or to other people. They might then need to go back into hospital, at considerably greater expense.
Baroness Ramsay of Cartvale: I very much appreciate the concerns raised by both previous speakers. I also appreciate that behind the Bill, the amendments and the statements by the noble Lords, Lord Rowallan and Lord Alderdice, there are excellent intentions. I would say to the noble Lord, Lord Mottistone, that, because we are taking care of what is, after all, a most important and wide ranging piece of legislation and examining it very carefully, that does not mean that the Government, over the 10 or 11 months that they have been in office, have not been doing everything that they can to rectify the problems raised. I hope I made clear that, while we object to the Bill on some points of principle, our main objection is to having piecemeal legislation such as this.
11.30 a.m.
Lord Lucas of Chilworth: The noble Baroness's appreciation will come as somewhat thin beer to those of us who want something to be done now. While appreciating what the Minister said in her opening remarks in response to my noble friend Lord Rowallan, the problem is that, as she said, her right honourable friend and the Government want to take a long, hard look at this matter, it being only part of a much wider problem, and that in due course it might be felt necessary to have a full review. We are therefore a couple of years away from doing anything. No doubt after two years a Green or White Paper will appear and after another year or 18 months legislation may eventually appear before Parliament. That means that it will be five or six years before anything is done.
As all noble Lords who took part in the debate at Second Reading and this morning have said, this matter is urgent. Can the Minister tell us now what action she foresees to alleviate the situation underlined by this Bill?
Baroness Ramsay of Cartvale: I do not have the crystal ball which the noble Lord, Lord Lucas, has which tells him that it will be five or six years before anything is done and I shall not make any predictions. We are looking at the situation and are very alive to all
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the issues. There are already positive moves on many points raised by noble Lords today and at Second Reading. I am afraid that the noble Lord, Lord Lucas, will have to wait and see until the Government report on their careful considerations and consultations on this wide-ranging and important subject.
Lord Campbell of Alloway: Having listened to this fascinating and rather worrying discussion, perhaps I may ask the noble Baroness whether the Government are looking at the reform of certain existing statutes—and, if so, which—as part of the work they are doing or whether they are looking at the matter with a view to introducing an entirely new legislative structure. It would be interesting, and a source of comfort to many concerned, to know exactly what the Government are doing. I am not criticising from the point of view that the work will take a long time; the problem is serious and difficult. However, it would be interesting to know whether the Government are looking at the amendment of existing statutes or at an overall new approach in a new statute.
Baroness Ramsay of Cartvale: I made clear—though obviously not clear enough—in my opening remarks on this amendment that one of the reasons why the Government do not favour the Bill is that we do not favour piecemeal changes to a complex piece of legislation such as the Mental Health Act. In our view, significant changes should be made as part of a review of the whole Act. I confirmed to the Committee that we are considering the need for a review of the Act and in doing so will take account of the views of all interested parties.
Lord Rowallan: I am delighted to hear the noble Baroness indicate that the Government are giving this matter very serious thought. After all, It is an extremely serious matter. There are an enormous number of mentally ill and mentally handicapped people, as my noble friend indicated, in the world today. However, we cannot wait, as was suggested at Second Reading, until 2004 or 2010. Something needs to be done much sooner.
I am delighted that the Minister's right honourable friend is looking at the matter seriously and carefully, but legislation is required now. Mental health has always been the Cinderella service, historically under resourced and neglected. Many patients remain in anti-therapeutic and wholly unacceptable environments. The law compels many patients to reside in such places and therefore the law should offer protection for those to whom its sanctions apply. Primary legislation is necessary now; we cannot wait for a new Act.
As I am sure the noble Lord, Lord Alderdice, agrees, morale in the profession is rock-bottom. Recruitment is falling. Professionals elect to take early retirement, in part because they cannot bear the working conditions. Section rates are increasing year on year, partly because patients fear hospital admission and because of the disturbed anti-therapeutic environment which exists. Because of the Bournewood ruling, more and more people are liable to be put into necessary 24-hour care.

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We cannot wait any longer. It is for that reason that I have introduced the Bill in the hope that, although it does not embrace the whole problem, we can sort out a small part of it. In-patient care is only about 10 per cent. of the problem, 90 per cent. relating to care in the community and out patient care. If we can sort out this small part of the problem first, we shall at least be doing something to help those who are afflicted by this terrible illness and for whom, unless we do something, there is not much hope.
On Question, amendment agreed to.
Clause 1, as amended, agreed to.
Clause 2 [Privacy and physical security for in-patients]:
Lord Rowallan Lord Rowallan moved Amendment No. 2:
Page 1, line 25. after ("units") insert—
("() the provision of in-patient facilities for young people, separate from those for adults;").
The noble Lord said: Again, as a result of Second Reading, it became obvious that not only women but also the young were in danger and required single-sex ward areas. The young often find themselves in the very unsavoury position of being next to an adult who poses a danger to them. It can be a very frightening world for the young in a mental ward. I have seen it and it is not something I would wish on anyone. All the main mental health charities support this clause and the amendment.
Keeping the young in a safe, therapeutic ward area can only help them if they are in an area separate from adults. It is our duty to ensure that young people suffering from mental illness have every opportunity to recover from their illness. The amendment seeks to do that by giving them the same chance to enjoy a therapeutic environment as adult women and men in which to receive the care and attention which they so desperately need in order to recover. I beg to move.
Lord Alderdice: I first became aware of the difficulties faced by young people as in-patients in psychiatric units when in Northern Ireland in the early 1980s no psychiatrists were specifically allocated to deal with the problems of adolescents. It was not hard to see why that was the case. The key thing about being a young person is that it is time-limited. After a few years one grows out of being a young person and becomes an adult, who may be just as disturbed or even more so but for whom responsibility moves to different authorities.
I may say—I take some encouragement from this—that when we were enabled to debate the matter in the Northern Ireland Assembly, which had no legislative powers but simply gave us the opportunity to debate matters, within a short time there were changes because it became a matter of public concern and an adolescents' psychiatry unit was established.
A number of developments have created further anxiety in this regard. First, as I mentioned, as more people are being cared for in the community, the concentration of increasingly disturbed people within psychiatric units has increased and made them more difficult places in which to work for staff and in which to be for patients. That is particularly a problem for young people.
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Secondly, in recent years we have become aware that many young people develop psychiatric difficulties not least because of abusive experiences that they have suffered. That was something with which we were less familiar a number of years ago but we are becoming increasingly familiar with the fact that many young people become profoundly disturbed in their behaviour and in themselves because of abusive experiences early in their lives. Indeed, when young people cut themselves, overdose and in other ways attempt to damage themselves, we now always pay attention to the possibility of abuse and particularly of sexual abuse.
Many young people who become disturbed and are taken on for treatment can be dealt with in an out-patient context or in day-patient facilities. But it is commonly the experience of those working with such young people that a period of containment is sometimes necessary in order that the work with them can continue. Sometimes it is only for a short time—perhaps a few days—hut it is nevertheless critical to the work with a young person.
As I said, many of those young people have experienced sexual or physical abuse from adults. They find themselves frequently—I say this not out of speculation, but out of my certain knowledge—having to be admitted to relatively secure facilities in which there are adults who in some cases have perpetrated violent or sexual abuse. Of course there may be concerns as to whether some repetition of the experience may occur, but even setting that to one side, how can one believe that it is not disturbing for a young person who has experienced such abuse and been so disturbed by it that he or she needs psychiatric treatment and who, during that treatment, has become sufficiently disturbed to need to be admitted to a containing atmosphere, to find themselves contained in precisely the same context as those who, with other young people, have been the perpetrators of abuse? They may be perpetrators for a whole series of reasons that we may or may not understand; that is not the point. It is clearly profoundly antitherapeutic.
I appreciate and find encouraging the fact that the Government are looking at these matters. It was suggested that it is not appropriate to deal piecemeal with them but that we need something that is broad—ranging. I accept that there is force in the Minister's argument in that regard. However, is it appropriate that young people should have to wait for a number of years for all the manifest and manifold problems of the service to be addressed and all the different legal requirements to be dealt with? Is it appropriate that they should have to wait or is it the case that, even if the Government do not allow this Bill to pass through the other place, some kind of regulation may be introduced to ensure that young people, particularly disturbed young people, are not continuing to be cared for in a context that is profoundly, and obviously, not in their best therapeutic interests.
In advance of the Minister being able to give us such enlightenment, I strongly support the amendment. I look forward also to seeing whether the Minister can find some other way in which the Government. through

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regulation, can ensure that such facilities are insisted upon and made available in all areas. I look forward to hearing what the Minister is able to say.
Earl Howe: Once again my noble friend presented the argument for the amendment most cogently and I support him. The need for separate in-patient facilities for young people is important for two reasons. The first is that young people, especially if they have been abused, need protecting from those who may be potential abusers. That is a principal reason and the noble Lord, Lord Alderdice, laid out that argument clearly.
The second is that early diagnosis and early treatment are essential to a successful outcome in cases of severe mental illness. Where a youngster suffers mental trauma, breakdown or something of that kind and needs to go to hospital, the process of treatment and recuperation is immeasurably assisted if the environment in which care is delivered is as conducive as it can be to recovery. The proximity of disturbed adults in a ward where a youngster first arrives to be looked after can pose an unhelpful barrier to the adjustment which that youngster needs to make if he or she is to be given a better chance of being successfully treated.
I hope that the Minister is able to accept at least the principle of the amendment, which addresses itself to the needs of some of the most vulnerable of mental patients, and can give us cause to hope that action will be taken to provide facilities of the kind the amendment seeks to promote.
11.45 a.m.
Lord Swinfen: Although I support the amendment, I wish to ask the Minister a question in relation to line 27 where the provision states,
"the fitting of appropriate security devices to all room and ward doors in all existing psychiatric units".
Does that mean that it will not be necessary in new psychiatric units? It may be that at Report stage we will need to remove the word "existing" from the Bill. Perhaps the Minister will consider the point.
Lord Thurlow: I too strongly support the intention behind the amendment. None of those who listened to the exposition of the noble Lord, Lord Alderdice, could fail to be moved by the urgency of taking the necessary steps where there is a risk of a young person finding himself in a ward with someone who might assault him.
I speak with some experience. One of my sons, as a youth and severely schizophrenic, was in and out of big hospitals. He had a great deal of excellent care and I cannot say, in retrospect, that in any of the hospitals he attended there seemed to be any danger of the risks we are discussing today. But that does not mean to say that conditions have not changed on account of the problems of concentration to which the noble Lord, Lord Alderdice, referred.
I do not see that there is any reason why the necessary action cannot be taken by the health authorities, with or without—I hope with—the necessary stimulus from the
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Department of Health and without further primary legislation. Within the framework of the existing Act there is no reason why, if resources are available and if the will exists, this kind of segregation cannot be made when necessary. I repeat that I have some qualification about the generalisation. I know from experience that a young person can be in a secure ward without being in that sort of danger. However, I am sure that there are many situations where there is a crying need for rectification and for urgent action.
Baroness Ramsay of Cartvale: The Department of Health policy for child and adolescent mental health services is outlined in A handbook on child and adolescent mental health published in 1995. It stresses the importance of developing comprehensive services that span those within primary care through to specialist in-patient settings. A programme of work to implement policy is under way with the lead being taken by the regional offices of the National Health Service Executive.
The Government recommend that young people requiring in-patient mental health care should have access to facilities that are both age appropriate and able to meet their needs effectively. We do not underestimate the problems which the noble Lord, Lord Alderdice, so expertly put before us and which the noble Lord, Lord Thurlow, expressed from his unequalled personal experience. Young people with mental health needs are treated in a range of settings. It is recognised that, on occasions, particularly in the acute phases of illness, adult psychiatric wards are sometimes required for admission and this may not always be desirable. We would agree with what the noble Lord. Lord Alderdice, had to say on that subject. Young people, however, vary in maturity and degree of independence. The amendment is imprecise, leaving open the definition of "young". Sometimes it will be the psychiatric care required, rather than the chronological age, that will be the determining factor for where best a young person is treated. The amendment, which places a duty on health authorities, will limit flexibility. As the noble Lord, Lord Thurlow, so precisely said, in principle, if conditions are right—I do not want to paraphrase the noble Lord—there is nothing that could be objected to in what has been said by noble Lords. However, the amendment places a very precise duty on health authorities and would limit their flexibility.
In recognition of the genuine concern over access to in-patient facilities and the possible need for further guidance, the Department of Health is shortly to commission a national study. It will undertake a needs-based assessment of current in-patient provision, the alternatives that exist, the pathways of care for young people, and an analysis of current and future requirements. This will inform policy and service developments and enable planning into the next century to take place on a rational basis. I hope I am going some way to reassure the noble Lord, Lord Alderdice, and others that progress in this area does not depend on and hang entirely on legislation either being changed or being introduced.

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The noble Lord, Lord Swinfen, asked a specific question about the Bill. I think that his question is more correctly addressed to the noble Lord, Lord Rowallan, whose Bill this is.
The amendment cannot be supported as to enshrine this duty in legislation will impose unrealistic burdens on health authorities in the immediate future, will reduce flexibility in service provision for young people, and may lead to inappropriate service developments. Those would be better planned after an assessment of the national situation has taken place. We cannot support the amendment.
Lord Alderdice: Before the noble Baroness sits down, perhaps I may welcome strongly the undertaking she has given and the nature of the study. When she speaks of a national study, may I have reassurance that that applies to England and Wales, Scotland and Northern Ireland—to the whole of the United Kingdom?
Baroness Ramsay of Cartvale: I shall tell the noble Lord what I think and then write to him if I have to correct myself. I would imagine that this applies to England and Wales. I cannot think that it would apply to Scotland or to Northern Ireland. However, if I am wrong about that, I shall certainly make that clear to all noble Lords.
Lord Alderdice: When we talk about a national health service we assume that it extends to the whole of the United Kingdom. However, the noble Baroness says that a national survey on a matter of this importance would apply only to England and Wales. I very much hope that the answer she has given is either not entirely correct or is one that can perhaps be reviewed.
Baroness Ramsay of Cartvale: As a Scot, I do not want to get into too much detail on this matter. As the noble Lord will know, at the present time health in Scotland is dealt with by the Scottish Office and in the very near future it will be dealt with by the Scottish parliament.
Lord Rowallan: Existing child and adolescent services cater for elective planned admissions and cannot cater for emergency admissions. Every acute psychiatric admission unit is periodically required to admit children because there is no alternative for them. On a ward at Homerton Hospital, which I recently visited, a 13 year-old girl was admitted, mute but aggressive, following a serious sexual assault by her step-father, which I am afraid happens all too often. Nowhere else could or would take her. During her admission she was given illicit drugs by other patients and was herself subjected to sexual harassment and assault. That is disgraceful and should not be allowed to happen. It is small wonder that the professionals involved do not wish to carry on maintaining and working in such a service if we allow that sort of thing to happen. We cannot sit back and allow this to go on. How many more 13 year-olds or 14 year-olds have to be seriously harassed and abused in mental health hospitals, where they are supposed to be receiving treatment, before we do something? I beg to move.
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On Question, amendment agreed to.
Clause 2, as amended, agreed to.
Remaining clauses agreed to.
House resumed: Bill reported with amendments.

Government of Wales Bill
Brought from the Commons; read a first time, and to be printed.

Business Improvement Districts Bill [H.L.]
11.59 a.m.
Report received.
Clause 1 [Business Improvement District (Election) Orders]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 1:
Page 1 line 10, leave out subsection (2) and insert—
("(2) Subject to subsection (3) below, a local authority may make an election order for any area —

(a) which is wholly comprised within the area of the authority, and constitutes the whole or part of the area in which the establishment of a business improvement district is proposed; or

(b) in relation to which the authority are discharging the functions of another local authority as respects the establishment of a business improvement district.

(3) The applicant for an election order must he a ratepayer in respect of a hereditament within the area for which the election order is proposed.").
The noble Lord said: My Lords, in moving this amendment it may be for the convenience of the House if I speak to Amendment No. 23. I hope that the House will bear with me for a moment if 1 follow the example of the noble Baroness, Lady Farrington, at Committee stage when she craved the indulgence of the House to make a general point near the beginning of that stage (Hansard, 27/2/98; col. 886.). After some introductory remarks, she made two specific points, and I wish to refer to one of them. At col. 887 she said,
"It is clear that under the provisions of the Bill, businesses in an area will have to pay a certain amount if there has been a local vote to that effect. Although individual businesses will have the opportunity to vote, they will not have a choice on payment of the charge if the decision is taken to implement the draft scheme. As I am sure the Committee will recognise, this is exactly analogous to the taxation system in any democratic country. We can influence the level of income tax via the ballot, but there is no choice on whether or not to pay. This is, by definition, a tax and spending of the income received would count as public expenditure".
At the time I questioned that statement. Since then I have had the advantage of advice from some financial experts in this country. I have been able to study the European system of accounts to which the noble Baroness referred on that occasion. But perhaps most important, I have had the advantage of a meeting with the noble Baroness, for which I am immensely grateful. She was accompanied by a formidable group of officials not only from the DTI, but from the Treasury and from the Office of National Statistics.
I believe that it would be fair to say that we did not attempt to resolve the issue as to whether a charge under this Bill is a tax and the spending of it would count as public expenditure. But I believe that we reached an understanding that, first, it would be right to proceed with the remaining stages of the Bill in this House (and we are here today to deal with the Report stage), secondly, that it would be for another place to take account of the argument perhaps by requiring a privilege Motion to be moved in the ordinary way; thirdly, that if expenditure by a BID company is indeed public expenditure that still leaves open the question as to whether it should be treated as part of what is called in the jargon "the control total"; and, fourthly, and perhaps most important of all, the Government's forthcoming consultation paper on the local government financial system, which we were told will include options for business rates, will certainly be germane and may well be directly relevant to the issue. So I do not intend to say any more about it at this stage, but to follow the understanding that the noble Baroness and I reached that we should proceed with the Bill.
I move straightaway to Amendment No. 1. A number of points were raised during Committee stage, many of which we have tried to meet with the amendments which I have tabled. The purpose of this amendment is to ensure that a local authority may make an election order where the area concerned is within its boundaries or outside those boundaries; where the authority is acting on behalf of another local authority; or—and this is the substantive change made by the amendment—where the authorities are acting jointly through, for example, a joint committee. That arrangement may be appropriate in some cases where, for example, there is a substantial area in two or more local authority areas and none of them wish to release the task of processing the business improvement district's application to the other. The amendment is intended to cater for the joint arrangements in such cases.
The new subsection retains the requirement that the applicant for an election order must be a ratepayer of the hereditament in the area in which the BID is being proposed. Since Committee stage I have had the advantage of visiting one or two areas which I was told would be wholly applicable to this Bill. I have heard of others. I believe that at Second Reading I mentioned the Park Royal estate in West London which is within the area of three different local authorities. So the amendment is intended to deal with a point that was raised. I beg to move.
Baroness Farrington of Ribbleton: My Lords, I am grateful for the further work that the noble Lord, Lord Jenkin of Roding, has undertaken to refine the Bill. I have no comments on this particular amendment although it appears to envisage separate orders for the different areas it mentions. However, in considering the amendments which have been laid today, the House may wish to have confirmed that discussions were held with the noble Lord following Committee stage. The Government's view that the charges imposed by a BID company would be treated as a tax and the income
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raised would count as public expenditure, as the noble Lord, Lord Jenkin, said, together with the fact that we are still awaiting the Government's paper on the review of local government finance, which I believe will be issued imminently, mean that we cannot give the Bill our support.
On Question, amendment agreed to.
Clause 2 [Application for election order]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 2:
Page 2, line 12, at end insert (", subject to subsection (4A) below,").
The noble Lord said: My Lords, in moving this amendment I shall also speak to Amendments Nos. 3 and 21. Amendment No. 2 is a paving amendment and the substantive amendment is Amendment No. 3, which inserts a new subsection into the clause.
The purpose of the new subsection (4A) is to deal with the situation where the maximum business improvement district charge proposed exceeds 5 per cent. It will be recalled that in Committee there was some debate about the desirability of allowing for that without requiring all the businesses paying BID charges to agree to the increase as the Bill provides at present.
However, there is a difficulty in allowing a proposal for a further increase beyond 5 per cent., on the basis of agreement by a majority of businesses, even with a majority of three-quarters of participating businesses, as the noble Baroness, Lady Hamwee, suggested in her amendment at Committee stage. Those businesses which had not been in favour of setting up the BID, but which were outvoted, would find themselves subject to additional charges without further scrutiny if the Bill was simply to provide that the percentage could be increased further once a bid was established.
Such an arrangement might also open the door to some indiscipline over the assessment of costs incurred when a scheme is put forward. So subsection (4A) allows for such an increase, but only where the application to set up a business improvement district is in fact for the continuation of an existing scheme. Adopting that mechanism ensures that the proposal is subjected to further scrutiny by the local authority and further representations from interested parties, as well as giving all the businesses concerned a vote as to whether a scheme should be confirmed on such a basis. It may be that where a scheme is seen to be successful and there is an impetus to continue it, a large majority of businesses will be receptive to the possibility of an increased charge. That is a prospect that ought to be assessed with the same level of protection which applies to initial applications.
The amendment to omit Clause 14 is tabled because the issue raised there is now being dealt with under the new subsection. I beg to move.
Baroness Farrington of Ribbleton: My Lords, while recognising the efforts made by the noble Lord to give BID companies, in proposing the continuation of a BID

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scheme, a greater degree of latitude in raising funds, noble Lords may wish to consider whether unlimited charges would be desirable.
Baroness Hamwee: My Lords, I recognise that the noble Lord, Lord Jenkin of Roding, has responded to a concern that I voiced in Committee. To a large extent, my amendment was probing and I was not persuaded by it, but I was concerned about how increases might be dealt with and whether appropriate and perhaps small increases could be prevented by a small number of chargepayers. I remain somewhat concerned because there seems to be no top limit to the amount of the increase.
We have heard from the Government that the Bill is fated to run up against the buffers, but that it will no doubt form part of the discussions when your Lordships are considering business rates in the context of the forthcoming Green Paper. I think that there is still some mileage to go in how one deals with possible increases, but I recognise the efforts which the noble Lord has made to deal with this point.
Lord Jenkin of Roding: My Lords, with the leave of the House, perhaps I may respond. I am well aware that there are certain obstacles in the way of the Bill making a great deal of progress in another place. Nevertheless, as I said at Second Reading, the idea of a business improvement district (with some mechanism for requiring all business ratepayers within the area to pay if a two-thirds majority support the Bill) has attracted much interest and there is now a good deal more steam behind the idea.
Earlier this week, a number of us in an all-party group concerned with London listened to a fascinating talk on the subject of London theatres and some of their problems. We were interested to learn that London theatres very much support a BID on the lines of what happens in New York as a means of increasing the attractiveness of the theatre area to patrons. I was up in Walsall last week where strenuous efforts are being made by the East Mercia Chamber of Commerce, with the support of the local authority, to upgrade some of the rather run-down industrial areas near the railway and canal, with some exciting projects. They, too, would very much welcome the Bill.
That is why I make no excuse for pressing ahead, while recognising that the scheme may have to wait for another piece of legislation. In the mean time, the amendment offers a way ahead if the Bill makes progress. There will no doubt be other opportunities to look at the detailed points which have been raised by the two noble Baronesses. I commend the amendment to the House.
Lord Bowness: My Lords, my noble friend's amendment addresses a problem to which we referred in Committee. If a business improvement district has been established and if unanimity were required for its continuation, some very good work might come to an end in short time. If I understand the amendment correctly, it seems that an application for an extension is subject to the same vote as an original application
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and, therefore, requires the same majority of business ratepayers to be in favour. In that respect, I am content to support the amendment.
Baroness Hamwee: My Lords, with the leave of the House, I am sorry if the noble Lord, Lord Jenkin, misunderstood me. My comments were directed to this amendment, not to the principle. My concern was about the apparent lack of a cap—although perhaps I am the last person in this Chamber who should be calling for a cap—to the total of the business charge as incorporated in this amendment.
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 3:
Page 2. line 29, at end insert—
("(4A1 Where an application under this section is for the continuation of a business improvement district scheme, or for the continuation of a scheme subject to such modifications as may be proposed in the draft scheme accompanying the application, the maximum annual business improvement district charge proposed under the draft scheme may exceed 5 per centum and shall be the figure proposed by the applicant.").
On Question, amendment agreed to.
12.15 p.m.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 4:
Page 1 line 37, leave out ("3(1) and (2)") and insert ("3").
The noble Lord said: My Lords, in moving Amendment No. 4, I should like to discuss also Amendments Nos. 5, 6, 7 and 10. Amendment No. 5, which seeks to insert new Clause 3, makes it clear that in considering an application for a BID a local authority should have regard to interested persons generally, quite apart from the specific attention to be paid to the representations of the interested parties which are mentioned specifically in paragraphs (a) to (e). The interests which are to be given specific consideration by the local authority have also been broadened to include—at paragraph (b)—businesses located outside the area of the proposed BID but which would be affected by it, and any interested public authority, which we call a "relevant authority", which we seek to define in Clause 30 by means of Amendment No. 27, which we are also considering with this group, as I should have made clear earlier.
The reason for employing that term may need some explanation. As defined, "local authority" means a billing authority, and will generally be a district authority, a London borough or the City of London Corporation. That is natural enough because the applicants for BID schemes ought naturally to be the authorities which keep non-domestic rating lists—and they are the billing authorities. They do not include such authorities as county councils and police authorities, all of which may provide services or undertake initiatives in the area of a proposed BID. They therefore could be said to have a particular interest in an application, and it seems right that those areas should be given particular consideration along with the other categories referred to in the clause. Therefore, the definition of "relevant authority" used in the Bill is the same as that in Part V of the Local Government and Housing Act 1989.

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That is the definition deployed for the purposes of revenue accounts and capital financing of local authorities. It seems to me to be the most appropriate definition to catch the appropriate authorities consistent with keeping the notification process within reasonable bounds.
The amendment has been tabled in response to specific criticisms made in Committee and I hope that the House will feel that it meets the case. I beg to move.
Baroness Farrington of Ribbleton: My Lords, I note and welcome the work carried out by the noble Lord to clarify and widen the scope of the representations that can be submitted to the local authority as part of its consideration of a draft BID scheme. A concern remains that the clause, as amended, would mean that the Bill contains no reference to the timescale for making such representations. Does the noble Lord propose to deal with that at a later stage?
Lord Jenkin of Roding: My Lords, with the leave of the House, I would hope that any such details might be most appropriately dealt with in another place. If we have to embark on yet further amendments at Third Reading, I can conceive of there being some procedural difficulties. I thoroughly take the Minister's point, but I would much prefer to leave such matters for proceedings in another place. However, I hope that this amendment can he accepted and I commend it to the House.
On Question, amendment agreed to.
Clause 3 [Consideration of application]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 5:
Leave out Clause 3 and insert the following new clause—
CONSIDERATION OF APPLICATION
(". In considering a draft scheme a local authority shall have regard to such representations as may be made by interested persons, and in particular by—

(a) any ratepayer in respect of a hereditament within the area specified in the draft scheme;

(b) any ratepayer in respect of a hereditament not within the area specified in the draft scheme but which is affected by the improvements which are proposed by it;

(c) any other person in respect of such a hereditament, being a person having an interest in that hereditament in any capacity;

(d) any person who is either resident within the area specified in the draft scheme, or is not so resident but is affected by the improvements which are proposed by it; and

(e) any relevant authority.").

On Question, amendment agreed to.
Clause 4 [Making of election order]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendments Nos. 6 and 7:
Page 3, line 13, leave out from beginning to third ("the").
Page 3, line 14, leave out ("within that period").
On Question, amendments agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 8:
Page 3, line 31, after ("above") insert ("and any determination the authority propose to make under subsection (6) below").
The noble Lord said: My Lords, I beg to move Amendment No, 8 and speak also to Amendments Nos. 11 and 12. Amendments Nos. 8 and 12 which are linked deal with the potential exclusion of small businesses from liability to business improvement district charges. This was one of the major topics of discussion at Committee stage in relation to an amendment moved by the noble Baroness, Lady Hamwee. The desirability of providing some mechanism for excluding such small firms from liability was in general accepted. The mechanism is not however a straightforward one. Simply to provide, as one might have done, a minimum rateable value below which businesses would not be liable to pay BID charges, or would be liable to reduced charges, would be very inflexible. In addition, it would catch different categories of businesses according to the general level of rateable values in the areas in which they were located. In an area with low rateable values sizeable businesses might find themselves excluded when they should be paying. The same exemption threshold in areas of very high rateable values might exempt only the very smallest of businesses.
Amendment No. 12 seeks to address this by enabling the local authority to determine an exemption or abatement of charge. This local approach will enable the category of small businesses at which exemption is aimed to be more accurately identified on an area-by-area basis. When this scheme is put to the local authority with a view to asking it to hold a ballot and invoke the procedure in every case I expect the promoters of the scheme to have made very clear proposals as to the appropriate level of exemption. But it would be for the local authority to decide whether that level of exemption was satisfactory or should be varied.
Amendment No. 11 requires the local authority to inform the BID applicant if it proposes to exempt small businesses by a determination provided for in another amendment. Such action may prompt the applicant to reconsider pursuing his application if the result of the exemption is that the scheme will have significantly fewer contributors than he originally envisaged. That he can do; he can withdraw his application. The procedure now exists under which there can be an exemption for small businesses. The decision as to where the line should be drawn—there may be more than one line; there may be a line for an abated contribution—is made by the local authority and the applicant can decide, in the light of that, whether he still wishes to proceed. I beg to move.
Baroness Hamwee: My Lords, I thank the noble Lord for markedly improving my amendment moved at the previous stage. I too had concluded that it was not possible to be prescriptive in terms of amount or proportion with regard to the exemption of small businesses. The noble Lord's amendment is more comprehensive than mine, and I certainly welcome it.
Baroness Farrington of Ribbleton: My Lords, we recognise that this amendment builds on suggestions made at Committee stage by the noble Baroness, Lady Hamwee.
Lord Jenkin of Roding: My Lords, I am grateful for the remarks of the noble Baroness, Lady Hamwee, I hope to reciprocate in a moment. I beg to move.
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 9:
Page 3, line 32, leave out ("thinks") and insert ("considers reasonable and").
The noble Lord said: My Lords, I beg to move Amendment No. 9. I say straight away that this was a very good point raised at Committee stage by the noble Baroness, Lady Hamwee. It requires the modification sought by the local authority to be both reasonable and necessary in the opinion of the authority. The noble Baroness makes a very good point and I hope that this amendment meets it.
Baroness Farrington of Ribbleton: My Lords, one hopes that a local authority would never wish to make any modifications unless it believed that they were reasonable. No doubt the intention of the noble Lord is to make the Bill more flexible in this respect. We would query however whether in the interests of flexibility it is desirable for modifications to be necessary as well as reasonable. We wonder whether the noble Lord would be prepared to look again at this aspect of the Bill.
Lord Jenkin of Roding: My Lords, I simply remind the noble Baroness of the remarks that I made a few moments ago. Of course, account can be taken of the point that she has made if the Bill makes progress in another place. I beg to move.
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 10:
Page 3, line 34. leave out ("subsection 3(1)") and insert ("section 3").
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 11:
Page 3, line 46, leave out from ("above,") to end of line and insert ("or the local authority have made, or propose to make, a determination under subsection (6) below which is relevant to the application, the local authority shall inform the applicant in writing of the modifications or determination (as the case may be)").
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 12:
Page 3, line 47, at end insert—
("(6) The local authority may determine that any hereditament whose rateable value as shown on the local non-domestic rating list does not exceed an amount specified by the local authority shall be—

(a) exempt from the payment of business improvement district charges; or

(b) subject to an abatement of such charges,

and the determination may make different provision for exemption or abatement as respects different rateable values.").
On Question, amendment agreed to.
Clause 5 [Provisional BID charge list]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 13:
Page 4, line 5, leave out from ("hereditaments") to end of line 7 and insert ("whose ratepayers will, subject to such modifications as may have been required under section 4(3), be scheme charge payers in accordance with section 2(4)(b).").
The noble Lord said: My Lords, I beg to move Amendment No. 13. That is intended to make clear that the obligation on a local authority to prepare a BID charge list relates to the premises of the ratepayers who have been identified by the person who wishes to set up a BID as the prospective contributors. As the Bill stands it could be read as requiring the local authority to compile a complete list of hereditaments in the area, which would not be sensible. The amendment also takes into account the fact that the businesses identified by the person proposing to set up a BID and listed in his draft scheme may have been modified by the authority as a result of its consideration of the application under Clause 4(3). I believe that this represents a procedural improvement and I hope that the House will feel able to accept it.
Baroness Farrington of Ribbleton: My Lords, it is important it should be clear who is to pay the charge but in so far as it is suggested that Clause 2(4) has the effect of imposing it, I feel bound to question this. The noble Lord may wish to look again at the drafting and the way in which the Bill creates liability for the charge.
Lord Jenkin of Roding: My Lords, I shall take note of the points just raised by the noble Baroness. Perhaps the House would accept the amendment for the time being.
On Question, amendment agreed to.
Clause 8 [Method of voting]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 14:
Page 5. line 17, leave out ("incorporate") and insert run ("unincorporate").
The noble Lord said: My Lords, I beg to move Amendment No. 14, which seeks to leave out "incorporate" and insert "unincorporate". This is a technical amendment to make clear that in the case of unincorporated bodies a voting paper may be completed by an officer of the body concerned.
Baroness Farrington of Ribbleton: My Lords, this appears to be a sensible correction.
On Question, amendment agreed to.
Clause 9 [Services etc provided by local authority]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 15:
Leave out Clause 9 and insert the following new clause—
SERVICES PROVIDED BY RELEVANT AUTHORITY
(" .—(1) Subject to subsection (3) below, improvements made through the implementation of a business improvement district scheme shall be taken as being in addition to and not in substitution for the level of services delivered by or on behalf of a relevant authority in the discharge of their functions, and accordingly—

(a) in deciding whether to make, or to refuse to make, an election order under section 4(1);

(b) in coming to an opinion that such an order should he refused under section 4(2); or

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(c) in requiring modifications to a draft scheme under section 4(3),

a local authority shall assume the provision of the existing level of services in the area for which the business improvement district scheme is proposed.
(2) In considering the level of services to be provided or maintained in the discharge of their functions, a relevant authority shall not treat any area less favourably by reason of the improvements which are or will be made in that area through the implementation of a business improvement district scheme.
(3) Nothing in this section shall be taken as prejudicing the operation of section 70 of the Deregulation and Contracting Out Act 1994 (functions of local authorities): but where, pursuant to an order made under that section, services are delivered by a BID company, such services shall he treated as being in substitution for the services which would, but for the order, be delivered by the relevant authority.
(4) In this section "the existing level of services" is the level of services which is provided at the time of an application for an election order under section 2.").
The noble Lord said: My Lords, I beg to move Amendment No. 15, which seeks to insert a new clause. I should like to speak to Amendment No. 16 which also seeks to insert a new clause. This amendment involves a good deal of redrafting. The intention is to deal with the difficult area of additionality. Here one is concerned with a situation in which if a BID is set up, the improvements should not just replace what the local authority would otherwise have done but should be additional to them.
This issue generated a good deal of interest in Committee. The new clause seeks to deal with a situation in which improvements proposed by a BID scheme are, for example, intended as a top-up of services which the local authority provides. There are a number of existing examples where precisely this kind of activity takes place. In a BID area people want a higher standard of street cleaning, pavement cleaning and lighting and better visual amenities. They may want greater security. The local authority may already provide some of that. What the BID seeks to do is to provide an improved and enhanced level of service for which the ratepayers are prepared to pay.
It is clearly inappropriate that a local authority should use a BID proposal simply as a way of offloading its own responsibility for providing the services by reducing them or progressively withdrawing them on the basis that the business improvement district company is going to provide them instead. The new clause therefore provides that in considering the application for a BID they should assume the level of services that they are providing at the time the application is made. That, as it were, is the baseline. It is in comparison with the baseline that the improvements have to be weighed. That of course does not deal with what might happen once the BID is actually set up.
As I think I said at an earlier stage, it might well be ridiculous to have, for instance, two separate processes for collecting the refuse or for sweeping the streets. A local authority might decide to withdraw services after the BID is established on the basis that the BID will take the strain, but if it were to reduce services not as a result of its establishment but as part of a general reduction, perhaps in a period of financial stringency, it would clearly be inappropriate for the BID district to be
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protected by requiring the local authority to maintain the level of services when it was actually reducing them everywhere else.
To deal with this type of situation, subsection (2) provides that the local authority shall not treat the area less favourably than any other area of the authority simply on account of the BID's existence: in other words, the area of the BID is neither privileged nor discriminated against when it comes to the provision of local authority services.
But the clause is without prejudice to the ability of the local authority and BID company to agree together that, for instance, the BID company would exercise the functions of the local authority where an order under Section 70 of the Deregulation and Contracting Out Act has been made. This provision replicates an amendment which was tabled and accepted in Committee, but of course it is not only the local authorities, as defined by the Bill as billing authorities for the purposes of non-domestic rates, which provide services. That is why it is necessary once again to refer to "relevant authority". I shall not repeat what I said on the earlier amendment. It takes account not only of the local authority which is the billing authority but those others which I referred to on that amendment.
The second amendment, the new clause following Clause 9, deals with what might be described as capital works proposed by BID schemes. Such proposals, typically, for example, planters, street furniture and so on, may also be on the local authority's agenda, but it will be understandable for a local authority to remove such proposals from its forward plan once a BID came along with a plan to make the improvements. That would seem perhaps to be undesirable.
On one view, such a consequence recognises that businesses which want improvement now rather perhaps than three or four years down the tracks would have to pay for that advantage, but in any event it would seem right that an authority which is contemplating improvements when a BID application is made should at least be required to inform the applicant that improvements are in the pipeline. That knowledge may prompt the applicant to delay setting up a BID or wait to see what the local authority actually does. Therefore what the clause provides is a notification procedure. The requirement to notify applies to the relevant authority which means that the obligation is not confined to the local authority to which the application is made, and, as I said, takes account of the fact that other authorities may have relevant capital works in mind.
The fact that a relevant authority may have provided facilities given time, may even have had plans to start work on them, will also seem to demand at least consideration by that authority of the making of a financial contribution to the cost of the BID, and to have them in contemplation, the authority must, after all, have seen a public benefit.
So these two clauses together cover a range of issues which may well arise on the application of a BID where there is work in contemplation, and where the local authority might therefore wish to have regard to that and must notify the BID applicant. The second clause seeks

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to deal with the situation by requiring the relevant authority to consider the making of a financial contribution where in the opinion of the authority it is likely that the improvements would have been made, or at least started, in the period during which the proposed BID will be in existence. I beg to move.
Lord Bowness: My Lords, I am grateful to my noble friend for bringing forward amendments to address the situation of additionality, and, in particular, capital. If one is looking at local areas, it is important that businesses wishing to combine through the purpose of a BID to bring forward relatively small capital improvements, which can in small district shopping centres make a remarkable difference, should be able to do so. The amendment represents safeguards. It enables that to happen but it also safeguards the position of the local authority's programme and the possibility of a contribution. Therefore I welcome the amendment.
Baroness Farrington of Ribbleton: My Lords, I welcome Amendment No. 15. moved by the noble Lord, Lord Jenkin of Roding, to address the difficult question of ensuring that moneys raised by the BID company are directed at extra services to those provided by a relevant authority. However, as I said in Committee there is a real difficulty in fixing a level of service, and assessing how a level of service can be sensibly measured and maintained over a number of years.
Amendment No. 15 provides that the "existing level of service" is the level of services which are provided at the time of an application for an election order. However, in its consideration of the BID application it is not clear how the local authority will ensure that improvements to be undertaken during the life of the BID company would be in addition to those that the local authority or other relevant authority would carry Out.
I welcome the principles of Amendment No. 16 proposed by the noble Lord, Lord Jenkin of Roding. It goes some way to encourage local partnerships and ensure that improvement schemes are not duplicated. However, the amendment seems to place the BID applicant in a position of uncertainty as there is no timescale by which the exchanges of information between the local authority and other relevant authority must be completed.
Lord Jenkin of Roding: My Lords, with the leave of the House, I understand the points that the noble Baroness has made. I think it is possible in these sorts of cases to be altogether too prescriptive and, indeed, if you have a local authority which is in discussion with a BID applicant, I have no doubt that these are matters which can be dealt with.
If the relations have reached the point where strict timetables, and so on, are necessary, the suggestion I would make is that that does not provide a very good augury for a satisfactory partnership, but I think the clause as it stands is quite workable. I am grateful for the support that it has received, particularly from my noble friend on the Front Bench. I hope that the House
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will be able to accept it. If, on further reflection, further changes would be necessary they no doubt can be introduced in another place.
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 16:
After Clause 9, insert the following new clause—
NOTIFICATION WITH RESPECT TO FUTURE IMPROVEMENTS
(" .—(1) On receipt of an application for an election order made under section 2, the local authority shall send to any other relevant authority appearing to them to have an interest the name and address of the applicant and the particulars of the improvements proposed under the draft scheme.
(2) A relevant authority notified under subsection (1) above shall forthwith notify the local authority in writing—

(a) of any proposals for improvements which are the same as, or substantially the same as, the improvements proposed under the draft scheme, or

(b) that there are no such proposals.

(3) Before making an election order, the local authority shall inform the applicant in writing of any proposals notified to them under subsection (2) above or any proposals for improvements to be made by them which are the same as, or substantially the same as, the proposals in the draft scheme.
(4) To the extent that any proposed improvements of which the applicant has been informed under subsection (3) above are, in the opinion of the authority proposing the improvements, likely to have been made, or had work commenced on them, in the period specified by the applicant as the proposed duration of the business improvement district scheme, that authority shall forthwith—

(a) consider making such financial contribution to the cost of the improvements proposed under the draft scheme as is appropriate in the circumstances of the case; and

(b) following such consideration, notify the applicant of the decision in writing.

(5) Where the authority referred to in subsection (4) above are not the local authority to which the application for an election order was made, they shall forthwith notify that authority of the decision in writing.
(6) Where a local authority have notified any other relevant authority under subsection (1) above, no election order shall be made unless notification pursuant to subsection (5) above has been received by the local authority.").
On Question, amendment agreed to.
Clause 11 [Formation and functions of BID company]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 17:
Page 6, line 3, at end insert—
("() No BID company shall be formed or constituted in such a way as to be a company controlled by, or subject to, the influence of a local authority within the meaning of Part V of the Local Government and Housing Act 1989 (companies in which local authorities have interests).").
The noble Lord said: My Lords, with this amendment I propose to discuss Amendments Nos. 24 and 25. Amendment No. 17 to Clause 11 prevents a BID company from being set up in such a way as to make it a company controlled by, or subject to, the local authority's influence. This term is defined in Part V of the Local Government and Housing Act 1989.
The result, if a BID company were to be controlled or influenced, would be to treat the expenditure of the BID company as though it were the local authority's. This would result in a substantial constraint on the BID company and plainly affect the expenditure plans of the

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local authority, too. This is a different point from that which I mentioned at the start of today's proceedings. It is a necessary technical amendment to avoid what would otherwise be a considerable difficulty.
The consequence of the amendment is that local authority participation in a BID company board will be limited. However, that does not preclude the involvement of local authorities and existing partnership arrangements under town centre management schemes. In fact, they often mirror the minority interest which is required to avoid the operation of Part V. The point is independent of whether the expenditure is general public expenditure.
The new clause after Clause 29 takes account of the fact that "local authority" as defined in the Bill is not the same as for the purpose of Part V of the Local Government and Housing Act 1989 which was referred to in Clause 11, as amended. The amendment to Clause 30 is a consequence of defining "local authority" separately in the new clause following Clause 29.
These complicated different definitions appear to be necessary because one is having to make use of existing local government legislation which has been drawn up with a variety of different purposes in mind. Nevertheless, I hope that the amendment is clear and workable and I beg to move.
Baroness Farrington of Ribbleton: My Lords, I support the intention of Amendment No. 17 to ensure that the BID company is not controlled by or under the influence of the local authority. Perhaps the noble Lord may wish to consider whether the clause will meet its aims at all times, in particular after the company has been launched.
Lord Jenkin of Roding: My Lords, I agree to take note of that important point.
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 18:
Page 6, line 9, at end insert—
("() A BID company shall, in discharging its functions, have regard to the interests of scheme chargepayers.").
The noble Lord said: My Lords, a point of accountability was raised by the noble Baroness, Lady Farrington, in Committee. The amendment is designed to enhance the accountability of the BID company to the chargepayers. The effect of the amendment is to require the company to have regard to the interests of all scheme chargepayers in implementing the scheme. Clause 30 contains a definition of scheme chargepayers. I hope that that goes some way toward meeting the Minister's concerns. I beg to move.
Baroness Farrington of Ribbleton: My Lords, I am pleased that this amendment makes it clear that the BID company should, in carrying out its work, have regard to the interests of the scheme chargepayers. However, noble Lords may wish to consider whether this provides sufficient accountability to the chargepayers. I fear that
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the concerns about accountability that I raised in Committee would remain valid, despite the praiseworthy intention behind the amendment.
Lord Jenkin of Roding: My Lords, we have given careful consideration to whether the measure should go further. I remind the House that we are dealing with a company which will be subject to all the provisions of the companies Acts. Those Acts provide elaborate procedures for making the company and its management accountable to the shareholders and to a growing number of stakeholders. On reflection, the amendment which I have moved, and which the noble Baroness has welcomed, adds sufficient to the statutory accountability which already exists to make any further amendment to the Bill unnecessary. I hope that on reflection the Minister will recognise that.
On Question, amendment agreed to.
Clause 13 [Business improvement district charge]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 19:
Page 6, line 20, at end insert—
("() The liability of a person from whom a business improvement district charge is demanded shall be assessed as though the charge were a non-domestic rate in respect of a hereditament shown on the non-domestic rating list in force at the time the demand is made.").
The noble Lord said: My Lords, in moving Amendment No. 19 I shall discuss Amendment No. 26. In Committee, specific reference was made by the noble Baroness to the relationship of BID charges to the local government finance system as a whole. As I and the noble Baroness have indicated, the matter is under review and we are expecting a consultation paper in due course. However, the amendments seek in part to clarify the basis of liability to a BID charge. Amendment No. 19 treats the liability of a person to a business improvement district charge in the same way as a liability to a local non-domestic rate. In other words, for a ratepayer in occupation of premises within a BID it provides for liability on a day-to-day basis, just as the ratepayer is liable for non-domestic rates. The consequence of the amendment is that liability to BID charges follows liability to non-domestic rates set out in Part III of the Local Government Finance Act 1988.
Amendment No. 26 changes the definition of "ratepayer" to refer to a person who is liable to a non-domestic rate. That more appropriately aligns the definition with the rating legislation and makes clear that it is liability to rather than payment of a rate to which liability to BID charges relates. I beg to move.
Baroness Farrington of Ribbleton: My Lords. I can appreciate what the noble Lord is trying to achieve with Amendment No. 19. The Bill envisages a close link between liability to the charge and liability to non-domestic rates. However, the present amendment seems to leave unanswered a number of issues upon which the noble Lord may wish to reflect. For example, he might want to consider how the Bill should address the effect of changes to hereditaments; what happens when a new hereditament comes into being; and the

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treatment of unoccupied hereditaments. These and other related matters will need to be addressed if the Bill proceeds further.
Lord Jenkin of Roding: My Lords, as the Minister responds to many of the amendments, I at least recognise that if a Bill of this kind is to reach the statute book it will require the attention of parliamentary counsel and of the experts in the various departments concerned. That is normal procedure. The noble Baroness has made it abundantly clear on more than one occasion, both in public and private, that she does not expect this Bill to reach the statute book. In those circumstances, I entirely understand the reluctance of the Government to place parliamentary counsel at the disposal of myself and my supporters.
I take note of the point that she made and if at a later stage, or perhaps in future legislation, these points need to be dealt with they can be. In the meantime, I commend the amendment to the House.
On Question, amendment agreed to.
Lord Jenkin of Boding Lord Jenkin of Boding moved Amendment No. 20:
After Clause 13. insert the following new clause—
LEASES
(".—(1) This section applies where premises are let to a person ("the tenant") who, by reason of his occupation of those premises, is or becomes liable to a business improvement district charge.
(2) Where the tenant alleges that the level of rent which will become payable to the person from whom the premises are let ("the owner") on the grant of a further tenancy or on a review of an existing tenancy is attributable to the improvements provided for by the business improvement district scheme, the tenant may, in the absence of agreement with the owner as to the level of rent payable, apply to the county court.
(3) Where an application is made under subsection (2) above, the county court may, after hearing the parties and any witnesses they desire to call, and having regard to the terms of any contract between the parties and the length of time which the tenant has been liable to the BID charge, make such an order as it considers just and equitable in the circumstances of the case.
(4) Without prejudice to the generality of subsection (3) above, the court may make an order which provides—

(a) that the rent payable by the tenant shall not take account of any enhancement of value attributable to the improvements provided for by the business improvement district scheme; or

(b) that the whole or part of the charge shall be borne by the owner.").

The noble Lord said: My Lords, the amendment addresses an issue which was discussed at length in Committee when I tabled a new clause but withdrew it. The clause provides a mechanism by which landlords and tenants can resolve their differences through a mutual forum when the tenant takes the view that improvements result in an enhancement of the landlord's interests and the parties are unable to agree how to split the charge, or when the tenant takes the view that the landlord has profited unfairly from the improvements which have at least in part been paid for by the tenant through rent increases.
Whether that situation arises will depend on the nature of the improvements provided by the BID scheme. However, it may be that the tenant is put in a position where the establishment of a BID scheme to which he contributes results in a general improvement in the area and then the landlord seeks to enhance the rental at the next rent review or when a new lease is applied for. The amendment addresses that situation by allowing the tenant to apply to the county court, which is given a broad power to make an order which is just and equitable in the circumstances.
The court's attention is directed specifically by the clause to the possibility of disregard in relation to rent payable which is attributable to improvements made by the BID or a contribution by the landlord to the BID charge itself.
The House will note that a relevant feature in deciding whether the landlord should contribute is the length of time for which the tenant has been liable for the BID charge. This new clause as now drafted would not, for example, permit a new tenant simply to go off to the court and seek a contribution from the owner. The application will arise only at the next rent review or on the granting of a new lease when the length of time for which that tenant has been in occupation and paying hid charges will be considered.
I suggest that the use of a county court rather than arbitration to settle the issue is appropriate because the improvements provided under a BID are not restricted to the occupier who applies but are improvements affecting the area as a whole. The House will remember that the county court already has jurisdiction in relation to the granting of new leases in cases where the Landlord and Tenant Act 1954 applies, as it does to most commercial leases. Specific precedent for the use of the county court as a forum to deal with disputes over the level of contributions is provided by Section 170 of the Factories Act 1961, to which I referred in Committee.
Finally, one of the criticisms of the clause tabled in Committee related to the provision for the lease to be determined. I accepted those criticisms. I believe that the noble Baroness used the word "draconian" and we have abandoned that proposal because we do not wish to appear draconian. Therefore, that provision does not appear in this proposed new clause.
I believe that we have gone a long way towards meeting the criticisms which were addressed in relation to what is a real issue. We have provided a procedure whereby justice can be done between landlords and tenants where there is a BID. I beg to move.
Baroness Farrington of Ribbleton: My Lords, we welcome the efforts made by the noble Lord, Lord Jenkin of Roding, to address the question of providing equity between landlords and tenants as regards the financial contribution to the cost of BID schemes and the consequential effect of schemes on rental income and costs.
With regard to the specific amendment, we have a concern about the amount of litigation which may arise and the burden on the courts. The amendment contains

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little guidance to the courts. The noble Lord, Lord Jenkin, may wish to explore the use of other mechanisms which may avoid the need to go to court. He may wish to consider whether it would be possible to incorporate the principles implied by the amendment in the normal mechanism for determining rents at rent review or on the renewal of the tenancy.
In addition to the very lengthy consultation which I know the noble Lord has already undertaken, he may find it helpful to seek the views of professional bodies such as the Royal Institution of Chartered Surveyors.
Lord Jenkin of Roding: My Lords, that is a very valuable suggestion. Of course we have been in contact with that profession. I thought that perhaps the precedents provided by the legislation which I mentioned—the Landlord and Tenant Act and the Factories Act—might have provided a suitable precedent. But of course that will be looked at if the Bill proceeds in another place. In the meantime, I believe that this proposal provides an appropriate procedure and I hope that the House may be able to accept the amendment. I commend it to the House.
On Question, amendment agreed to.
Clause 14 [Alteration of business improvement district charges]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 21:
Leave out Clause 14.
On Question, amendment agreed to.
Clause 16 [Recovery of business improvement district charges]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 22:
Page 6, line 35, after ("recover") insert ("as a civil debt").
The noble Lord said: My Lords, this amendment provides that a BID charge may be recovered as a civil debt. There was some suggestion that a BID charge might be deemed to be a local non-domestic rate for the purposes of collection and recovery. I believe that the noble Baroness suggested that in Committee.
On reflection, that seems to be a rather heavy-handed way of dealing with the issue. As it is the company which would receive the money, it seems perfectly reasonable that it might look upon it as a civil debt.
However, the noble and learned Lord the Lord Chancellor has announced a review of civil debt procedure, of which I have taken careful note. No doubt if the procedure is reviewed and this provision is on the statute book at the time, it will be covered by the review. In the meantime, to provide that it should be recoverable as a civil debt seems to me to be a sensible way of dealing with the matter. I beg to move.
Baroness Farrington of Ribbleton: My Lords, this seems a sensible amendment to achieve the end proposed by the noble Lord, Lord Jenkin.
On Question, amendment agreed to.
Clause 29 [Local authority discharge of functions]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 23:
Page 9, line 6, at end insert—
("() In this Act, reference to the discharge of the functions of a local authority by another local authority includes reference to the discharge of those functions jointly.").
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 24:
After Clause 29, insert the following new clause—
INTERPRETATION OF "L0CAL AUTHORITY"
(". In this Act, other than in section 11 so far as that section relates to Part V of the Local Government and Housing Act 1989 (companies in which local authorities have interests), "local authority" means a billing authority as defined in section 1(2) of the Local Government Finance Act 1992, responsible for the maintenance of a non-domestic rating list pursuant to section 41 of the 1988 Act.").
On Question, amendment agreed to.
Clause 30 [Interpretation]:
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 25:
Page 9, leave out lines 23 to 26.
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 26:
Page 9, line 36. leave out ("subject to") and insert ("liable to pay").
On Question, amendment agreed to.
Lord Jenkin of Roding Lord Jenkin of Roding moved Amendment No. 27:
Page 9, line 36, at end insert—
(""relevant authority" means a local authority within the meaning of Part IV of the Local Government and Housing Act 1989 (revenue accounts and capital finance of local authorities);").
On Question, amendment agreed to.

Lord Chancellor (Tenure of Office)(Amendment) Bill [H.L.]
12.55 p.m.
Lord Alderdice: My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(Lord Alderdice.)
On Question, Motion agreed to.
House in Committee accordingly.
[The DEPUTY CHAIRMAN OF COMMITTEES (Lord Murton of Lindisfarne)in the Chair.]
Clause 1 [Office of Lord Chancellor]:
Lord Alderdice Lord Alderdice moved the amendment:
Page 1, line 9, at end insert—
("(3) At the end of section 2 insert—
"Where the Lord Chancellor is not an adherent of the Roman Catholic faith the power to make provision under this section may only be exercised with the agreement of the Lord Chancellor."").
The noble Lord said: The amendment which I put forward to the Bill is an attempt to address two concerns which were raised on Second Reading. The first was that the Lord Chancellor might be liable to have removed from him functions described in Section 2 of the 1974 Act, even though the Lord Chancellor might be quite content and legally without bar in exercising those various functions. The functions are not particularly large but they are not without significance. They are that the Lord Chancellor shall be a church commissioner and shall exercise certain patronage.
I make it clear that there was no purpose in bringing forward the Bill that there should be removed from the Lord Chancellor any of those rights or privileges which he might rightfully fulfil and might in all conscience fulfil. But as the noble Lord, Lord Burnham, pointed out on Second Reading, there was a previous Lord Chancellor, the noble and learned Lord, Lord Mackay of Clashfern, of whom it was public knowledge that because of his deep religious principles and the fact that he was not a member of the Church of England, he did struggle. There was some discussion whether he should properly, from the point of view of his own conscience, fulfil some of the requirements of the Lord Chancellor's office. In the event, he decided that it was perfectly proper for him to do so.
I suggest that there may be others not of a Christian faith, not of any faith at all, indeed perhaps someone who was not particularly warm towards faith, who might feel that it was not proper for him to be a church commissioner or to exercise ecclesiastical functions. As I understand it, as things stand, there is no provision in law for the functions to which I have referred to be exercised by anyone else.
In my own view, the original Bill as put forward was permissive in any case. It did not say that such functions would be removed or that they "shall be removed", but that. other arrangements "may be made". In that sense, it simply takes on from the language of the 1974 Act; namely, that Her Majesty in Council may provide for those visitational or ecclesiastical functions to be exercised by the Prime Minister or other Minister.
However, it appeared on Second Reading that there was a feeling among a number of noble Lords that the Lord Chancellor might be liable to have these functions removed. As part of the whole purpose of the Bill is to give clarification on the matter—and certainly not to give offence or difficulty—I have put forward the amendment now before the Committee to try to ensure, as can be seen in the terms of the amendment, that the matter will only be exercised,
"with the agreement of the Lord Chancellor".
I trust that there will be an appreciation that this is to ensure that not only is there no legal bar by nature of religious profession, or the absence of religious profession, to anyone exercising the office of Lord Chancellor, but also that there is no reasonable bar of conscience to someone exercising the office of Lord Chancellor.
The question was raised on Second Reading whether the Bill was necessary. A number of noble Lords called in aid remarks made in Hansard by the noble and
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learned Lord, Lord Hailsham of St Marylebone, in the 1974 debate when he brought forward the original legislation. At that time, if we take simply the condition of Jewish people, the matter was not a problem. But, perhaps I may refer to the remarks that the noble and learned Lord made. He is the editor of Halsbury's Laws of England. I am referring to the 1996 edition of that work, which is a very up-to-date volume. The noble and learned Lord makes clear in that volume that subsequent to 1974—indeed, in the Statute Law (Repeals) Act 1989—the changes made in the Religious Disabilities Act 1846, by which Her Majesty's subjects professing the Jewish religion were subject to the same laws as Protestant subjects, were removed. The provision may have been removed inadvertently; I am sure that it was not removed on purpose in order to create a problem. But what does the noble and learned Lord Lord Hailsham say about it and about some other repeals which have taken place in previous years? He says:
"In the light of these repeals, particularly the repeal of the Religious Disabilities Act 1846, it is unclear whether a person professing the Jewish religion would be appointed Lord Chancellor without clarifying legislation".
If the noble and learned Lord who brought legislation to this Chamber in 1974 to clarify the matter—a matter which was subsequently effected 15 years later by the Statute Law (Repeals) Act 1989—now says very clearly in Halsbury's Laws of England 1996 that there is a problem, surely it is clear that this piece of legislation is appropriate, is necessary, is permissive and, I submit, ought to be passed by this Chamber. I beg to move.
The Lord Bishop of Norwich: Perhaps I should be ashamed to say that I am not very knowledgeable about ecclesiastical law, but it is not one of my enthusiasms. However, I recognise its importance in the maintenance of good order in the Church. For that reason, I value very highly the expert advice of ecclesiastical lawyers; indeed, I depend upon it. One of the Church's senior lawyers, Miss Ingrid Slaughter, sent me a detailed briefing on the Bill explaining the issues, which are more complex than I realised. She did so in language that even the Bishop of Norwich can understand. She has helped me in the past and, knowing my frailties, stressed in her briefing that she thought there was no need for me to speak. She did not add, because she is gracious, that she feared that, if I did so, I might make a hash of it. Nevertheless, I want to make a few brief and non-technical remarks.
The Church of England sympathises—indeed, strongly supports—the motives which have led the noble Lord, Lord Alderdice, to introduce his amendment. I hardly need labour the point that we share wholeheartedly with him a commitment to the unity of all the Churches, and an abhorrence both of a sectarian spirit and discrimination on grounds of religion or lack of it. However, I have to communicate the fact that the Church's lawyers, whom I know to he personally in complete sympathy with the noble Lord's motives, believe that there are technical flaws which would make for complications in the operation of parts of the Bill.

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If it was thought right ultimately to redraft the Bill, I believe that the advice of the Church of England's legal experts would be invaluable, as well as that of the Church's main committee, through which the main Christian denominations work together on matters touching relations between Church and state. So it is with regret and great reluctance that I have to say that I am unable to support the noble Lord's amendment. I say, "regret", because I strongly support everything that he is trying to do.
The Lord Chancellor (Lord Irvine of Lairg): I am grateful to the noble Lord, Lord Alderdice, for putting down an amendment, which I acknowledge is plainly intended to deal with a point that I made on Second Reading two weeks ago. What I believe the noble Lord has explained in substance to the Committee is the fact that the amendment is designed to ensure that a Lord Chancellor who is willing to exercise ecclesiastical functions, and who is not prevented by any legal bar from doing so, should be entitled to do so. As I understand the noble Lord, he has explained to Members of the Committee that the specific reference to adherents of the Roman Catholic faith is there in recognition of the fact that the situation would be different, in any event, if the office were held by a Roman Catholic, because there would be a pre-existing legal bar. I observe that the noble Lord is nodding his head in agreement. Therefore, I believe that I have accurately summarised his intention.
As I have something of a more encouraging nature to say at the end of my few remarks, I hope that the noble Lord will not be overly disappointed to hear that, while I fully appreciate that the amendment is well meaning, in my judgment the new words would not achieve what he intends. However, they demonstrate how difficult it can be to make apparently minor modifications to an area of law as complex as this one, without creating new anomalies and uncertainties. I was heartened to hear the right reverend Prelate the Bishop of Norwich say that he regarded ecclesiastical law as a rather complex sea that he would not desire for himself to navigate. There is art enormous risk that, in tying up one loose end, other threads will be broken. That is why even a modest change demands great caution and careful examination of all the other inter-reacting legislation.
Perhaps I may expand on that. I believe that the effect of the amendment now proposed to Section 2 of the Lord Chancellor (Tenure of Office and Discharge of Ecclesiastical Functions) Act 1974 would lead to four possible situations. First, if the Lord Chancellor were a Roman Catholic, there would be no change to the present law. He would still be barred by law from exercising the patronage functions. Accordingly, if nothing were done, those functions would devolve on the Archbishop of Canterbury, but they could be transferred to another Minister without the Lord Chancellor being involved. Secondly, if the Lord Chancellor were Jewish, he, too, would continue to be barred by law from exercising the functions himself. They might be transferred to another Minister, but only if the Lord Chancellor agreed. Otherwise
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they would devolve on the Archbishop. Thirdly, if the Lord Chancellor was a member of the Church of England, only he could exercise the functions. There would be no machinery to enable any other person to do so. I should pause here to endorse the comments made by the noble Lord, Lord Mishcon, at Second Reading about the uncertainty of what may be meant by being a member of that Church.
Finally, if the Lord Chancellor did not fall into any of those three special categories, the functions could be exercised by him, or, with his agreement, an Order in Council transferring them to another Minister could be made. Thus, for example, an atheist need not be deterred from accepting the office because his conscience made him reluctant to exercise an ecclesiastical function. On the other hand, as the initiative would not be with him, the offer might, in theory, have been made conditional on his agreeing that those functions should be carried out by someone else.
If I am right in my interpretation of what would be the effect of this amendment, the result would be far from simple and not satisfactory. Instead of there being fewer or no religious distinctions, there would be more. At the time when each appointment to the office was made, and perhaps before and at various stages afterwards, it would be necessary to investigate which of the four categories applied to the Lord Chancellor of the day, or prospective Lord Chancellor, in order to see whether the power could be exercised—let alone whether it should be exercised.
If the Lord Chancellor was a Christian, there could be uncertainty as to which of the categories applied to him. Membership or non membership of the Church of England is not statutorily defined, and in any event I understand that the Church takes the view that membership does not preclude the individual from being a member of some other religious group at the same time.
As I have explained to the noble Lord, Lord Alderdice, in correspondence—I have sent him a letter dated 26th March, which I hope he has received and considered—I have made it plain that I have considerable sympathy, as indeed has the right reverend Prelate the Bishop of Norwich, with what he is trying to achieve. Perhaps I should say that I have even more sympathy with him in the difficulty and intricacy of the task that he has courageously undertaken, in the attempt to weave a practical and simple solution into an exceptionally complex body of law with many and various sources.
I recognise that this amendment is well intentioned but for the reasons I have given I cannot commend it to the Committee. I am sure the noble Lord will permit me to say in the Chamber that I have expressed my personal sympathy for any Bill which relieved those who might be offered appointment to the office of Lord Chancellor from having to consider declining on religious grounds because of the ecclesiastical functions of that office. That is perhaps the other side of the coin from the motivation behind the 1974 Act. While it was clearly unsatisfactory that a Prime Minister should have been deterred from recommending the appointment of a

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Lord Chancellor of his choice because of concern that the appointment might prove to have been invalid on religious grounds, it would be equally unsatisfactory if the person chosen were deterred from accepting because he would be reluctant to exercise an ecclesiastical function which would be part of his role if he accepted.
I believe, however, that this problem could be more effectively met by a Bill confined to that particular purpose. I should make it clear that I am not saying that the Government would support such a Bill because traditionally these are matters for a free vote. However, I respectfully suggest to the noble Lord that, rather than seeking, as it were, to go it alone in truly deep and muddy legal waters, it would be better if he entered into discussions with my officials who have a deal of expertise in this recondite area. Lawyers of the Church of England to whom the right reverend Prelate referred could also join in the discussions. In the light of those discussions the noble Lord might be in a better position to consider how to proceed.
1.15 p.m.
Lord Alderdice: I am deeply grateful to the right reverend Prelate and to the noble and learned Lord the Lord Chancellor for their remarks and for their encouragement in principle for the small efforts upon which I have embarked. I am also grateful for their words of advice so graciously tendered. Unfortunately due to the vagaries of the postal system I am not yet in possession of the letter that the noble and learned Lord the Lord Chancellor has sent to me. I look forward to having an opportunity to study it and the comments that have been made in this debate.
As I said earlier, my purpose is to try to remove these anomalies, not merely for the benefit of those who might find themselves in this position but to signify how our community has developed at the highest levels in a constructive, positive and non-discriminatory fashion. Given the opportunities that have been proffered by the right reverend Prelate and particularly by the noble and learned Lord the Lord Chancellor to discuss these matters with those who have vastly greater technical expertise than I have, but who have the same commitment to achieving what is right and good, I shall withdraw the amendment as I wish to do useful business with the expert advisers. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1 agreed to.
Remaining clause agreed to.
House resumed: Bill reported without amendment.

Consumer Credit (Increase of Monetary Limits) (Amendment) Order 1998
1.17 p.m.
Lord Haskel Lord Haskel rose to move, That the draft order laid before the House on 13th January be approved [19th Report from the Joint Committee].
The noble Lord said: My Lords, the purpose of this order is to increase the monetary limits that determine which consumer credit and consumer hire agreements are regulated by the Consumer Credit Act 1974, as well as the limit at which certain credit advertisements are exempt from the provisions of the Act. These limits are currently £15,000. From 1st May 1998 the limits will be £25,000 and so will bring more loans within the scope of the Act. As a result more consumers should benefit from the advantages of the Act. This is because most consumers who take out unsecured consumer loans will have the protections the Act gives to regulated agreements such as cancellation rights and cooling-off periods.
Many consumers who take out loans for house purchase and other loans secured on property from lenders other than banks and building societies will also gain protection. Your Lordships will note that the limits covered by the order are some of the most important monetary limits in the Act. But the Act also contains various other monetary limits and amounts which the Government propose to increase by separate legislation which is not subject to the affirmative resolution procedure. I beg to move.
Moved, That the draft order laid before the House on 13th January be approved [19th Report from the Joint Committee]—(Lord Haskel.)
Lord Borrie: My Lords, I welcome the order. It restores to individuals the benefits of the protection of the Consumer Credit Act which has been eroded by inflation over the past 15 years. As the Minister indicated, a regulated consumer credit agreement provides a considerable amount of protection to the individual. I refer not just to the cooling-off rights but other rights concerning requirements for the agreement and pre-agreement material including an indication of the rate of interest so that it can be compared in a fair way with other rates of interest. As regards repossession of goods, I refer to the right of a firm stake, as it is sometimes called, in the goods obtained on hire purchase by having paid one third of the total due. It is undoubtedly beneficial to the individual to have the limit raised from £15,000 to £25,000.
However, the draft order raises certain questions in my mind. Why wait 15 years? One may not want such orders coming before the House every time inflation is 3 per cent. or 4 per cent. One does not want such an order coming before the House every year. However, bearing in mind that inflation has eroded protection gradually over a long period, instead of fixing the limits for 12 or 15 years ahead, perhaps by order the limits could be adjusted by the RPI. Alternatively, the Government could come forward with a draft order with a higher limit which one might reach as inflation of 2 per cent., 3 per cent., or 4 per cent. per annum was envisaged, no government apparently envisaging nil inflation. So why not a limit of £35.000 instead of £25,000?

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The final point on which I should be grateful for the Minister's comments is this. Why have a limit? The regulation applies only to individuals. I realise that it includes not only the private consumer but those in partnerships. But it excludes those in corporate businesses. It might be said that they do not need this protection; they can look after themselves. I am not sure why any individual should not enjoy the protection of the Consumer Credit Act which exists for regulated agreements. One might argue that the more money at stake—let us say, on a Jaguar or a Mercedes instead of a more modest saloon car—the more one needs the protection that the Consumer Credit Act provides for regulated agreements.
I welcome the increase in the limit that the draft order provides. However, I doubt whether it is satisfactory to deal with the problem once every decade or so.
Baroness Blatch: My Lords, the Minister will be relieved that I rise not to oppose the order but to support it, and to make a different point about the prolonged period over which there has been no increase. I put that down to a sustained period of low inflation, which has been welcome, and I hope the prospects of that continuing are good.
The noble Lord, Lord Borrie, raises some interesting points about whether there is to be a commitment to an annual review, or a target to be reached over time. It is important that at some time the Government set out their views. In the meantime I support the order.
Lord Haskel: My Lords, I thank the noble Lord and the noble Baroness for their comments, and for their support. My noble friend asks: why wait 15 years? The matter is reviewed as and when consultations lead one to think it necessary. There may be a good reason for having a regular review. I am sure that the Government will look into the matter.
As regards the limits being adjusted by the RPI, there are other matters so adjusted. I am sure that it is a matter the Government will consider. I thank my noble friend for that suggestion.
My noble friend suggests moving towards a limit which envisages what inflation will be. I am not sure that my right honourable friend the Chancellor would wish us to take a view as to what inflation will be and to move towards that total. I do not know how far that proposal will get.
My noble friend referred to the business aspect. That is a separate issue and not related to the order. However, since my noble friend raised the point, let me say that the Government agree with the judgment of the Commons committee which, before the election, examined the previous government's proposals to deregulate business lending. The committee rejected that on the ground that the Consumer Credit Act provides valuable protection to sole traders and unincorporated businesses. The Government have no plans to remove business lending from its scope. I thank noble Lords for their proposals. I commend the order.
On Question, Motion agreed to.

Employment Rights (Increase of Limits) Order 1998
1.26 p.m.
Lord Haskel Lord Haskel rose to move, That the draft order laid before the House on 18th February be approved [24th Report from the Joint Committee].
The noble Lord said: My Lords, the purpose of the order is to increase the maximum amount of most of the awards that industrial tribunals can make to individuals whose statutory employment rights have been infringed. It also affects the amount of redundancy payments payable to employees.
As your Lordships know, the employment rights legislation requires the Secretary of State to review certain limits annually. Those are the limit on the amount and duration of guaranteed payments; the limit on the weekly amounts payable from the National Insurance Fund to employees of an employer who has become insolvent; and the limit on a week's pay used in calculating statutory redundancy payments, the basic award of compensation for unfair dismissal, and the additional award for an employer's failure to comply with an order for reinstatement or re-engagement.
After taking into account the factors that we must consider—the general level of earnings; the national economic situation as a whole, and other relevant matters—we propose that the limit on the daily amount of guarantee pay should increase roughly by the rate of inflation, as measured by the retail price index. Since the last increase in September 1995, that is, from £14.50 to £15.35 per day, and that the limits on a week's pay should increase from £210 to £220.
The Secretary of State laid a report on 18th February in which she explained why the periods in respect of which guarantee payments can be made would not be increased. The legislation also enables the Secretary of State to review other limits on payments at her discretion. Those are the awards for compensation for unfair dismissal and the special awards which may be made in cases where the dismissal is related to an employee's activities as a trade union or a health and safety representative, as an employee pension scheme trustee, or as a representative for consultation about redundancy or business transfer.
We propose that the limits on these awards should also rise with inflation. We propose that the limit on the maximum award for compensation for unfair dismissal should increase from £11,300 to £12,000. These increases will ensure that the real value of the limit on payments and industrial tribunal awards will not be eroded.
The proposed new limits will be set out in the order. In commending the increases to the House, I wish to say that in reviewing the awards, as well as taking into account the factors I mentioned earlier, we have also had regard to employers' costs and the cost to public expenditure.
In the longer term the Government wish to consider whether the limits, and the arrangements for reviewing them, work in the best way to meet our aims. Although we are not in a position to say yet what the options might be, we should be interested to hear and would welcome representations from your Lordships and from interested parties elsewhere. I commend the order to the House.
Moved, That the draft order laid before the House on 18th February be approved [24th Report from the Joint Committee].—(Lord Haskel.)
1.30 p.m.
Baroness Blatch: My Lords, the order that the noble Lord has set out refers to 12 areas where the increases are to take effect. I wish to repeat the point made by my honourable friend in another place, Mr. Tim Boswell, when he referred to an increase of 4 per cent. for redundancy pay, and an increase in compensation by a tribunal of 6 per cent.
I have read the reply by the Minister in another place. Although the Minister uses the argument of rounding up and rounding down for this range of increases, and indeed the Minister referred today to "roughly by the rate of inflation", I remain of the view that a 2 per cent. differential, when uplifting costs in line with inflation, should not become common practice.
It is important to record, and always to keep at the forefront of one's mind, that any increase must be met by someone. In this case, the burdens fall on business. I believe that the estimated cost to business is between £8 million and £111/2 million. Those costs, taken together with many of the other financial burdens being laid on business, certainly as a result of two Budgets from the present Chancellor of the Exchequer, are causing considerable anxiety.
It may come as a relief to the Minister that I shall not oppose the order. However, I ask that extreme sensitivity to the business sector—which will fall subject to these costs—should be shown in future.
It is not simply a question of employers being responsible, and therefore avoiding the need for such measures. That is an argument that I take as read. Legislation is constantly being passed, some during this Session and some to come, which derives from obligations that will result from signing the social chapter. If the country is to flourish, a prerequisite for jobs and prosperity is that business should also flourish.
Lord Haskel: My Lords, I thank the noble Baroness for those comments. My answer is the same as that given in the Commons; namely, that it is a matter of rounding. However, we will take note of the noble Baroness's remarks. It will not become common practice. I imagine that, as these matters are rounded each year, so they will even out.
I also note very carefully the noble Baroness's remarks about the burdens on business. It is a matter that the Government, too, take very seriously.
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The Government have taken into account the views of business through a consultation exercise, which was carried out in respect of the previous increase, and also very recently, between November 1996 and January 1997. It was regarded as suitable for the 1997 review. These increases are being kept in line with inflation. We do try to keep the burden on business down. Nevertheless, we take very careful note of what the noble Baroness has said. I commend the order to the House.
On Question, Motion agreed to.

Railways (Rateable Values) (Scotland) Order 1998
1.34 p.m.
Baroness Ramsay of Cartvale Baroness Ramsay of Cartvale rose to move, That the draft order laid before the House on 27th February be approved [25th Report from the Joint Committee].
The noble Baroness said: My Lords, I beg to move the Motion standing in my name on the Order Paper.
The draft order before the House today is a straightforward provision which prescribes rateable values for the year 1997–98 for the operational lands and heritages occupied by ScotRail, and other franchise operators who are now in rateable occupation of property acquired from the British Railways Board.
The prescribed rateable value figure taken from the British Railways Board (Rateable Values)(Scotland) Order 1995 has been adjusted to take account of the disposal of a number of properties, and to arrive at a new prescribed total of £602,600 for 1997–98. That figure has been apportioned among the franchise operators on the basis of rental evidence from the current regulatory and charging regime and between local authorities on the basis of the locations of the properties concerned.
When the ScotRail passenger rail franchise was acquired by the National Express Group on 1st April 1997, the British Railways Board (Rateable Values)(Scotland) Order 1995, which had prescribed the rateable value of property occupied by British Rail, ceased to have any effect. This draft order prescribes the rateable value for the new occupiers and merely continues the previous rating arrangements.
The draft order has been subject to consultation, with local authorities and the franchise operators concerned. All are in agreement with the proposal. Further orders will be required for 1998–99 and 1999–2000 in due course. I commend the order to the House.
Moved, That the draft order laid before the House on 27th February be approved [25th Report from the Joint Committe.]—(Baroness Ramsay of Cartvale.)
Lord Luke: My Lords, we on these Benches support the approval of this order.
On Question, Motion agreed to.

Social Security (Minimum Contributions to Appropriate Personal Pension Schemes) Order 1998
1.36 p.m.
Lord Haskel Lord Haskel rose to move, That the draft order laid before the House on 4th March be approved [26th Report from the Joint Committee].
The noble Lord said: I beg to move the Motion standing in my name on the Order Paper. At the same time, I wish to speak to the draft Social Security (Reduced Rates of Class 1 Contributions, and Rebates) (Money Purchase Contracted-out Schemes) Order 1998.
I am grateful for this opportunity to put forward the Government's position on pensions, on contracting-out and, more generally, on rebates from the National Insurance Fund.
We believe that the two Budgets announced by the Government are good for the economy and will be good for pensions schemes in the long term. However, there was a need to ensure that personal pension holders did not lose out in the short term. We do not believe that there is the same short term problem for contracted-out money purchase schemes (COMPS). The rebates are reviewed every five years, and the next quinquennial review is due in three years. We believe there is no early action necessary in relation to this issue. That also applies to contracted-out salary related schemes (COSRS).
However, there is a short-term risk to individuals who have to decide whether they will be better off remaining in a personal pension scheme or contracting back into SERPS.
We do not believe that there is a problem for occupational pension schemes. Like the Government, they can take a longer view. A significant number of schemes are more than adequately funded, with some employers on contribution holidays and others paying contributions at a reduced rate. Because of the particular profile of some schemes, many do not have to rely on the contingency margin in the contracted-out salary related scheme rebate. These factors cover any short-term problems which may arise.
The current COMPS rebate reflects the fact that most COMPS were insured and had a small number of members. That was certainly the position in 1996, when the rebates were last set. Consequently, the rebate contains an expense allowance which recognises the higher administrative costs associated with running a small insured COMP.
However, since 1996 a number of changes have taken place which have altered the nature and composition of COMP schemes. We know that a number of schemes which were previously contracted out on a salary-related basis have switched to contracting-out on a money-purchase basis. Some of them have switched purely to take advantage of the higher rebates available to these schemes without any change in the benefits that they provide. Others have switched for business reasons not connected to the rebate. That is why from April
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1999 the expense allowances within the rebate will be replaced by that currently contained within the COSR rebate.
I do not believe that money purchase provision is about to become extinct. I do accept that contracted-out money-purchase arrangements have been on the decline for some while, but this is a trend that was established well before we took office. We have to accept that some pension providers will be quick to capitalise on any new arrangements, particularly if there is money to be made. But the rebates are to be reviewed at the latest in three years' time. This will be a full review, when we can give proper consideration to all aspects, including how they will fit with stakeholder pensions schemes. We shall also be looking then to ensure that there are no unwanted distortions in the system which are responsible for driving behaviour in a way which does not fit with the aims and objectives of contracting-out.
I fully recognise that this is a difficult and complex area. It is also clear that the rebate structure that we have inherited has over the past 20 years created inequalities. It is one which does not always match the needs of the different types of contracted-out pension provision now available. It is of fundamental importance that the aims and objectives of contracting out support the overall pensions framework. We fully intend to examine these difficulties within the context of the pensions review, but in the short term these orders do what is needed and I commend them to the House.
Moved, That the draft order laid before the House on 4th March be approved [26th Report from the Joint Committee].—(Lord Haskel.)
Earl Howe: My Lords, the Minister's introduction of these orders, for which the House will be grateful, gives the impression of a routine and uncontentious pair of measures. The fact that we are debating them on a Friday afternoon perhaps accentuates that impression. If only it were thus. The reality is, unfortunately, very different.
I do not relish using strong terminology in your Lordships' House, but the second of these orders represents, in my view, a most serious betrayal of substantial groups of pensioners who, before the Government were elected to office, had reason to expect much better things.
I hope the House will forgive me if I briefly set out the background. There are three types of pensions which one can have when working: an occupational contracted-out money-purchase scheme (COMP): an occupational contracted-out salary-related scheme (COSR); and a personal pension. A member of one these schemes receives a rebate from national insurance contributions to pay into the pension fund. The amount of that rebate is determined by the Government.
Last July the Chancellor abolished ACT dividend tax credits for pension funds. The Opposition, both here and in another place, and many people in the pensions industry said that this would have a very damaging effect on pension funds. The National Association of Pension Funds strongly criticised the Chancellor's proposed changes to ACT. As a result, nearly five

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months after the Budget, the Government sought advice from the Government Actuary, who did some calculations and put forward recommendations to alter each of the three rates of national insurance rebate to counteract the reduction in income which pension funds would suffer as a result of the Budget proposals.
The key assumption underlying those recommendations was that the return on investment for pension funds would be down by ¼ per cent. per annum. What did the Government do? They proceeded to accept the rebate figures based on that assumption for salary-related schemes and personal pensions but for money-purchase schemes they chose to ignore the assumption altogether and instead to opt for a rebate figure which, not to put too fine a point on it, would save the Treasury the maximum possible amount of money.
The result is that a larger rebate will be received on personal pensions, albeit not for nearly two years after the July Budget, but occupational pensions, and especially money-purchase schemes, have been hit. The COSR rebate has been frozen and the COMP rebate has been reduced way below the Government Actuary's recommendation. This creates a completely inconsistent regime for the three types of pension, each of which has suffered equally as a result of the ACT changes. There is no logic to that and, more important perhaps, there is no justice, either.
In their manifesto, the Labour Party promised to,
"support and strengthen the framework for occupational pensions".
The Chancellor of the Exchequer, when Shadow Chancellor, said during the election campaign said that all Labour's proposals would protect and improve the quality of life of pensioners. Yet within weeks of being elected to office the new Government gave us a Budget which directly penalised pension funds, a fact which they initially chose not to acknowledge, and subsequent to that, despite unequivocal advice from the Government Actuary, they have now taken measures which target occupational pensions, and specifically the contingency margins within them, as a source of free revenue for the Exchequer. The public as a whole are not aware of this. That ignorance is not surprising because the changes are hidden in technical and abstruse corners of statutory instruments and regulations which slip through Parliament largely unreported.
The questions for the Government are fundamental. The effect of the Government's failure to increase the COSR rebate is that the cost of contracting out will be higher than the cost of providing a benefit equivalent to SERPS. Do the Government accept that this will mean that many employers and scheme members will now pay more for contracted-out benefits than they would have paid if the employment had been contracted in? Do they also agree that the Budget change will leave many more COSR schemes reliant on their contingency margins than was the case before?
Turning to COMPS, do the Government agree that the effect of their decision will be to discourage such schemes and encourage employers to switch from COMPS to group personal pension schemes? Small employers, in particular, are apparently being told that
1500
if they move to a group personal pension scheme, or indeed back to SERPS, they will save money. Is that what the Government really want?
The effect of the second measure under discussion is quite simply to penalise money-purchase scheme members and small employers by reducing their rebate in order to finance the increase to the personal pension rebate which is needed to avoid many millions of personal pension holders returning to SERPS.
Despite their commitment to open government, the Government have not been open in explaining the effects of this measure on members of occupational schemes. That is to be deplored. There was no consultation on the Government Actuary's draft report, even though such consultation is routine in these circumstances. The Government have said one thing and done the opposite, hoping that no one will notice. I wonder whether the net result of all this will be to save money at the end of the day once people discover how the figures stack up.
Lord Haskel: My Lords, the noble Earl asked a number of questions and I shall try to deal with them one by one. He referred to the Government Actuary and the consultation that took place with him. First, I can make clear that the Government Actuary did not make any recommendations. There had been a number of changes which had the potential to impact on the national insurance rebates. We asked the Government Actuary for his advice in relation to those changes. He gave us his advice and we took note. But we also had other issues to consider. We had to look at trends in pensions and to decide whether public money was being properly spent.
The noble Earl suggested that those changes were being driven by cost with no consideration for the long-term position of pensions It is not cost-driven. There is no question that the COMP rebate was reduced to offset the cost of increasing the APP rebates. The money purchase rebate no longer reflects the nature and composition of contracted-out money purchase provision. It is largely immaterial why schemes are changing; the fact remains that many schemes are attracting an inappropriate level of rebate. Allowing that to continue is not prudent management of the National Insurance Fund and we are responsible for the prudent management of that fund.
The noble Earl spoke about the effect of the Budget on reducing the value of pensions and rebates. We have to look at the Budget as a whole and the Budget as a whole was good for the economy and will be good for pension schemes in the long term. As I explained, there was a need to ensure that people with personal pensions did not lose out in the short term. We do not believe that there is the same short-term issue for occupational schemes. The rebates are reviewed every five years and the next quinquennial review will be due in three years' time.
The Government Actuary was asked to examine trends in personal pension provision and issues arising from the Budget. The Budget was for the long term and pensions are a long-term business.
Lord Simon of Glaisdale: My Lords, no doubt the noble Lord will remember J. M. Keynes' remark that in the long term we are all dead!
Lord Haskel: My Lords, I am sure that we will take careful note of that remark. However, I was talking about the long term in terms of pensions and that is a measurable long term.
The noble Earl implied that the measures would push people back into SERPS. We are increasing the rebates on personal pensions because of the short-term risk that some people with personal pensions may have been advised to rejoin SERPS. Increasing the rebate ensures that contracting-out remains attractive and promotes funded pension provision. There is not a long-term problem for those occupational schemes, as I said. Our policies are designed to create an environment in which pensions will flourish. For the overwhelming majority of individuals in occupational schemes, there is no question but that they are better off out of SERPS.
I believe I have answered all the points raised by the noble Earl. If there are others, I shall certainly write to him. It is clear from this afternoon's debate that getting the relationship right between different methods of contracting-out is important and the interest generated by the noble Earl is testament to that. I am grateful for the opportunity to respond to the questions raised and I commend the order to the House.
On Question, Motion agreed to.

Social Security (Reduced Rates of Class 1 Contributions, and Rebates) (Money Purchase Contracted-out Schemes) Order 1998
Lord Haskel Lord Haskel rose to move, That the draft order laid before the House on 4th March be approved [26th Report from the Joint Committee].
The noble Lord said: My Lords, I have already spoken to this order. I beg to move.
Moved, That the draft order laid before the House on 4th March be approved [26th Report from the Joint Committee].—(Lord Haskel.)
On Question, Motion agreed to.

Sexual Diseases in the Former Soviet Union
1.54 p.m.
Lord Rea Lord Rea rose to ask Her Majesty's Government what steps they are taking bilaterally, or multilaterally through the European Union or the World Health Organisation, to help curb the rapidly escalating epidemic of syphilis and other sexually transmitted diseases including HIV/AIDS in the countries of the former Soviet Union.
The noble Lord said: My Lords, first, I thank all those noble Lords who have stayed this afternoon to discuss a problem which at first glance may seem a little remote
1502
from our concerns at home. But, as all noble Lords are aware, nowhere in the world today can be regarded, as Neville Chamberlain described Czechoslovakia in 1938. as, "a faraway country of which we know little".
Your Lordships' House has a tradition of compassion as well as a pool of expertise which covers most countries. However, I hope to show that there is more than a little self-interest for Britain involved in this Unstarred Question. More than ever infectious diseases respect no frontiers. Many travellers and business people cross into Russia and further, into central Asia, and from those countries "go west"—if they can scrape the money together—in search of fortune and a better life. Some of those sell sexual favours and bring with them diseases which to us may be "yesterday's men of death", particularly syphilis which is still easily curable with penicillin in its early stages but which, in the presence of the HIV/AIDS virus, poses new and serious problems.
To show how relevant the Question is to those of us who live in the European Union, I should like to read from a letter published in the Lancet on 21st February this year by a group of doctors working in Verona, Italy, who surveyed 110 foreign-born prostitutes who attended their clinic. The letter states:
"Immigrants from the former Soviet Union had the highest rate of active syphilis (27.8%). Compared with the rest of the group, these women had the least past experience in prostitution [were the youngest] and the highest incidence of pregnancy".
In other words, they did not understand the importance and had no education in the practice of safe sex.
My attention was brought to this growing problem by a seminar organised by the Social Market Foundation last month at which experts with knowledge of the sexually transmitted diseases (STD) situation in the former Soviet Union (FSU) discussed some very disturbing findings in a series of papers. Prominent among them were Dr. Alex Gromyko, adviser on STD and AIDS at the European Regional office of the World Health Organisation, and Dr. Adrian Renton, who is Reader in Public Health Medicine at Imperial College. He has made a special study of the problem following a fact-finding mission to Russia in December 1995.
They told us, for example, that the incidence of newly identified cases of syphilis in most of the countries of the FSU has risen dramatically in the past eight or nine years. In Russia, for instance, the total number of notified cases rose from just over 6,000 in 1988 to nearly 390,000 in 1996—a 62-fold increase. The notification rates per 100,000 of the population rose even more steeply in young people, especially 18–19 year-olds, with young women having twice the rate of young men.
Between 1990 and 1996 rates rose by multiples of 12.5 to 82 times in countries ranging from Moldova to Ukraine, Belarus, the Baltic States, through to Kazakhstan and Kirgizia. That is in contrast to the period before perestroika in which the high rates in the 1920s were brought down some 200-fold due to a vigorous public health control system and the use of penicillin. Other STDs, particularly gonorrhoea and chlamydia have probably had similar increases to syphilis, but because they are not so well notified the

1503
figures are less reliable. The law is enforced strictly on the notification of syphilis. The experts at the seminar were satisfied that the data that I summarised were based on sound laboratory methods.
It is worth mentioning that the rates of syphilis in most countries in northern and western Europe have been very low for some years—fewer than five per 100,000.
The reason that there is urgency in tackling this epidemic of "old fashioned" STDs, such as syphilis, is the now established knowledge that the spread of HIV/AIDS through sexual contact is much more rapid if the partner without HIV infection is suffering from one of the STDs that I described, particularly syphilis. That is because the protective epithelium (skin or mucous membrane) of the genital area is inflamed or ulcerated, thus offering a portal of entry for the HIV virus via inflammatory cells of the immune system where the virus flourishes.
I quote from the task force report of the WHO:
"In the presence of genital ulcers, the probability of HIV transmission per sexual act is increased 50–300 fold. Non-ulcerative STDs increase the risk of HIV infection less strongly, hut the population attributable effect may he even larger in areas where these STDs are highly prevalent".
A famous study in Africa showed that one could practically halve the transmission of HIV if treatment was offered for the common STDs that were prevalent there.
There was a comparatively low incidence of HIV infection in the populations of the former Soviet Union countries until well after perestroika, largely because of their previous relative isolation. Overall, even now, the cumulative number of cases has not reached the level even of western Europe. But while the incidence of new cases here has reached a plateau, and is now beginning to fall, the number of new cases in the FSU has shot up in the past three years; in Belarus, from eight to 1,021 between 1995–96; in the Ukraine, from 44 to more than 12,000 between 1994 and 1996; and in Russia there are similar increases. Initially, infection was largely confined to intravenous drug users who shared needles and syringes, a serious and increasing problem in the FSU, but in the past two or three years, as the epidemic has grown, an increasing proportion of infection is sexually transmitted.
The danger of HIV spread in a population with a high level of these bacterial STDs was brought home to the seminar by Dr. Renton in a calculation which showed that in a population with a 4 per cent. prevalence of syphilis, which is the case among 18 to 19 year-olds in one city in the Urals, the rate of transmission of HIV would increase by 20-fold above that in a population without STDs, leading to a major epidemic, possibly on a African scale, with a million or more deaths.
So an obvious question is: how did all this come about when STDs were previously under control? Of course, a complete answer would take several hours to relate, but the underlying cause is the enormous social and economic upheaval that has occurred in Russia and its neighbours during the past decade. The removal of an authoritarian, top-down bureaucracy and the
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encouragement of individual initiative has led many Russians to reject the punitive basis on which the sexually transmitted disease clinics of the USSR were run. Anonymity was not observed; indeed, workplaces were notified of cases among their staff: contacts were sought with the help of the militia; and treatment was compulsory. Syphilis was treated in a somewhat punitive manner by multiple injections of penicillin as an in-patient in hospital instead of out-patient treatment with one or two injections of long-acting penicillin, which is perfectly effective. At the same time the rigid (but hypocritical) moral code of the former regime has given way to a more relaxed attitude to sexual relationships, but without—this is very important—the sex education which should accompany it.
There has also been much more population movement. Economics, of course, have played a major role; many STD clinics do not get regular drug supplies, their staff are underpaid, and when the money does come it is often months late, leading to a very low state of morale and the seeking of work in other occupations to boost their inadequate income. Although some 10 per cent. of Russians have grown very rich since the end of the USSR, the majority are much worse off than they were, and there is a very high rate of unemployment, particularly among the young. In effect we are seeing the effects of a raw, unadulterated capitalism of Dickensian proportions on the health and behaviour of the population. Even going to a free STD clinic requires travel and there is usually a charge for drugs, if any are available. If people have little or no money, they cannot afford to attend.
In this economic climate, sex is treated increasingly as a saleable commodity, as a means of livelihood, especially, but not only, by women, some of whom may hope to gain advantages by granting favours to successful men. I could say that this behaviour is not unknown nearer home, even in the Palace of Westminster, but perhaps not so blatantly or to such a wide extent.
In Russia those with money can now attend private sector clinics or private doctors (some unqualified) who do guarantee anonymity. But the treatment and investigations are often over-elaborate so that higher fees can be charged.
Finally, there comes the question of how the UK can best help the situation. Of course, it is the governments and the people of the former Soviet Union countries themselves who will have to implement the package of measures that are necessary to cut short the current epidemic (and, I should add, also deal with their intravenous drugs problem, initially by the provision of clean syringes and needles) and thus, it is to be hoped, abort the much more serious danger of an explosion of HIV/AIDS. But it is important to act quickly. The rise is potentially exponential rather than additive and could lead to the deaths of millions of people. If nothing is done, there will be spill-over effects into the rest of Europe, and even to Britain.
The World Health Organisation is fully aware of the situation as is the consortium known as UNAIDS, which includes the World Bank. Several international meetings centring on the problem have been held and a task force on the problem has been set up. Reports from these recognise that health ministries alone in the countries concerned cannot cope with the problem. Many other departments of government need to be involved at central and local level. However, at a basic level sufficient trained personnel is available, but they need to learn new methods and new attitudes to regain the confidence of young people and how to co-operate with other agencies. Even the STD and HIV programmes are run separately. And confidential treatment must be made available at low cost or free with adequate supplies of condoms. Over and above this, a major public education exercise is needed, as was mounted here in the 1980s in response to the emerging HIV epidemic then.
Britain is running a small bilateral programme to assist. The Know-how Fund is backing a good demonstration programme in Samara in which family planning services, another area in great need of change in the former Soviet Union, are linked to STD services, and education departments are also being involved. I am aware of good work being done in the Ukraine by a project run by London Lighthouse and supported through the Millennium Fund, to which Healthlink, formerly AHRTAG, an NGO which I chaired for five years, has been acting as a consultant.
According to one of the Healthlink consultants who was in Kiev recently, the situation there is "dire". I shall be grateful if my noble friend can fill in more detail of the bilateral help that the UK is backing. In fact, the United Kingdom has built up an almost unique body of experience and expertise in the field of HIV/AIDS over the past decade and a half. We have a lot to teach.
This is far too big and urgent a problem, though, to be left to small, bilaterally-funded demonstration projects, even though they are a vital part of the assistance that we can give. Holding the EU presidency this year gives us an ideal position from which to convince other EU countries of the urgency of the situation and to realise that a window of opportunity now exists. The UK should recommend that strong support be given to the WHO Task Force for the Urgent Response to the Epidemics of STDs in Eastern Europe and Central Asia, which was set up at a meeting earlier this year in Copenhagen. I have no time to describe its recommendations in any detail, but it has produced an excellent document which I commend to my noble friend.
So far little European Union money has been spent on this emerging problem, which is on its very doorstep, while substantial EU development funds are going to Aids projects in Africa and south-east Asia. On 30th April there is a meeting of EU Health Ministers. I very much hope that my noble friend will be able to confirm that we will raise this very important issue that I have outlined at that meeting and will press for substantial backing for a multi-pronged assault on this developing tragedy in order to prevent it from becoming a disaster.
2.9 p.m.
The Earl of Carlisle: My Lords, I thank the noble Lord, Lord Rea, for introducing this timely and important subject, the spread of syphilis and HIV/AIDS and other contagious diseases in the former Soviet Union countries. If I have one quibble, it is a minor one. I hope that we shall try to get out of the habit of referring to the independent sovereign states of central and eastern Europe as former Soviet Union nations or countries. They were annexed to the Soviet Union in 1940 and subsequently in 1944, against their will.
I have to confess that I am woefully ignorant about medicine, hospitals and doctors. My knowledge is confined to what I learnt and picked up from regimental medical officers who served in my regiment; by an appendix operation; and, now, through visits to hospitals in the Baltic states. I needed to get a resident's permit. I went round a steeplechase of five hospitals having various medical checks in order to obtain it. I saw with fascination and horror how primitive the hospitals were.
I shall make two points. First, in 1945 the Allies reached Berlin. Sex from German women was available for cigarettes. The currency was a cigarette. After the Soviet forces withdrew the situation was not so bad. But sex is marketable for hard currency from the West, the Scandinavian countries or, indeed local currency.
I had the honour and privilege to lead a small team sent by the British Council to teach a United Nations peacekeeping battalion. I taught the English language for six months to 38 men between the ages of 18 and 32. To my knowledge four of them contracted syphilis during the course. Two of them were ill and their work fell off. I asked one of them why and he told me. I said, "You must tell your senior officer". He said. "I can't; I shall be thrown off the course".
Fortunately. I had met a leading psychiatrist in eastern Europe, Dr Anti Liiv, who is now a member of the Estonian Parliament. I met him at the British ambassador's table at lunch on 28th November 1994. I know the date because it is the day on which I became a Member of your Lordships' House. Dr. Anti Liiv told me this story. He was allowed to travel to the West during the Soviet occupation. He was allowed to do so because he did a great favour for the Russians. The Soviet Union had its great submarine base—the fourth largest in the world—at Paldiski on the peninsula about 15 miles from Tallinn. The Russians lost control, with alcoholism, contagious diseases, syphilis and the lot on the increase. They called in an Estonian to sort the place out.
Dr. Anti Liiv set up a clinic in Tallinn. He has informed me that syphilis, HIV and AIDS are on the increase. He says that he can provide medical support, but that it is limited and primitive. That is because the doctors need training. The Soviet Union, realising that it needed to keep control of its subject states, had to know every single detail of people's lives. So the people of eastern and central Europe were not encouraged or allowed to practise medicine. That is why the doctors need training.

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I am sure that we can assist, not only because of our generous nature, but also through various organisations such as the World Health Organisation and the European Union. However, time is pressing. Eastern Europe has outstanding universities. In Estonia, there is Tartu, founded in 1632. Theology, medicine, law and philosophy were its four core subjects, and have remained so. The Estonians, like, I am certain, the other 10 central and eastern European nations, look to us to assist. We have already done so to a considerable extent.
The noble Lord, Lord Rea, mentioned London Lighthouse. I have received a copy of a letter stating that,
"the London Lighthouse is suffering terribly from a sudden decision by the Health Authorities across London to withdraw their funding from Lighthouse's key residential unit. At a stroke, this has cut the charity's income by one-third, and they are now contemplating closure of the unit".
I regard that as a disaster, knowing how much valuable work London Lighthouse has carried out in St. Petersburg, the Ukraine and elsewhere. I hope that the health authorities will be persuaded to reconsider their decision. I know that there is pressure on their resources, but I hope that London Lighthouse will be able to continue to function.
Secondly, although I have taught young people in Tallinn, I have also gone out into the rural areas. I said to the head English teacher in the Pölva Maakons, "I know how busy you are, but do you ever go to Tallinn?" She replied, "Yes, and my first port of call is the British Council. I pick up all of its pamphlets and take them back to my students. I teach lessons from them." She showed me what she regarded as the most important leaflet. It was an excellent brochure on contagious diseases, syphilis and HIV. The British Council is doing very good work in educating people in eastern and central Europe not only in the study of our language, hut also in health promotion and sex education.
Britain has provided magnificent support through our military training teams. I refer to NCOs from the Royal Marines of the calibre of Colour Sergeant Alan Sheperd who was decorated for his work by the president of Estonia. He includes in his courses advice to young NCOs and soldiers about personal hygiene. It is a small but significant process because those young men who are being trained by the British Royal Marines will rapidly grow into positions of considerable authority. Again, I use Estonia as an example because these are the facts of which I am aware, but I am certain that the same is true of other nations in central and eastern Europe. I pay tribute also to the work of the Chevening Trust in granting scholarships in every field, particularly medicine.
Our British embassies in central and eastern Europe are doing excellent work. I refer to our ambassador, Tim Craddock, and to his predecessor, Ambassador Charles de Chassiron, who, from their limited funds, gave donations and equipment to hospitals to Tallinn. That was widely appreciated. I hope that the Foreign Office will be able to continue support through the embassy funds.
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I do not pretend to know the answer to this problem. The five plus one nations who are rapidly transforming their economies and will shortly be allowed to start negotiations with the European Union are fully aware that unless they meet the social criteria they will not make as rapid progress as they should. Therefore, on those grounds, they could be denied full membership of the European Union. I believe that the British nation can, through its contacts with the United Nations, the World Health Organisation and its presidency of the European Union, play a considerable part in eradicating and, hopefully, eliminating this ghastly social evil that could affect us all.
2.21 p.m.
Lord Kilmarnock: My Lords, we all owe a debt of gratitude to the noble Lord, Lord Rea, for drawing to our attention this important matter. He has already set out the facts very lucidly and I shall not repeat them. I merely reinforce them by invoking the observations of Dr.Karl Dehne, who represented UNAIDS, a United Nations consortium, at a seminar that I chaired in Amsterdam last year. It was he who first brought the whole of this field to my attention. At that seminar he said that, at a recent conference, Russia's Minister for Health had talked about 800,000 new HIV infections by the year 2000 in Russia alone. He said that in Russia there were about half a million intravenous drug users. He referred to the opening up of the gay scene and the increased contact between males from eastern and western Europe, as well as the increase in male sex workers travelling to western Europe.
He concluded his remarks at that meeting as follows:
"Eastwards from Central Europe there is no information, no access to counselling, STD services, condoms and so on. Some NGOs have started working with drug users in Eastern Europe but involvement is still very low. A major international initiative is now required, supported by adequate financial resources, to adapt the experience of Western Europe to the East and prevent this HIV and STD crisis from spilling over the borders of the East into the West".
I also draw upon an article by Dr. Adrian Renton, reader in social medicine at Imperial College. London, to whom the noble Lord, Lord Rea, has already referred, in the last issue of the EPPNA Review, which is the journal of the European Public Policy Network on HIV and AIDS. In that article he speaks of a 48-fold (4,800 per cent.) increase in syphilis notification in the Russian Federation between 1989 and 1996. That represents 263 per 100,000 of population. The rates for Belarus, Moldova and Khazakstan are not much lower, and the Ukraine scores a hefty 144 per 100,000.
These are the raw figures for syphilis but it is not the end of the story. Dr. Renton also stresses the linkage between STDs and HIV:
"There is good evidence that if one or both members of a sexual partnership has an STD, and one partner has HIV. then the probability of transmission of HIV during coitus may he several times increased. At the population level this enhancement of transmission is further amplified by the fact that both HIV and STDs

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tend to be concentrated within the same subgroups of the population. This combination of pockets of very high HIV prevalence among IVDUs"—
intravenous drug users—
"in major cities with high background levels of STD prevalence. … threatens to generate much larger epidemics of sexually transmitted HIV infection than have been seen in Western European countries".
Like the noble Lord, Lord Rea, I take the opportunity to pay tribute to Dr. Renton, who is the medical academic who has done most to bring this situation and this threat to the attention of the political world and who has produced much valuable information for more than one speaker in this debate.
Naturally one seeks an explanation of such an explosion. Dr. Renton, the noble Lord said, attributes it to the extremely rapid cultural changes brought about by market reforms, which have stimulated travel, internal migration, casualisation of sex, decline in the age of sex initiation, increase in prostitution, and penetration of sexually orientated products, images and advertising. This cultural revolution has been accompanied by the collapse of the traditional system of STD surveillance and control which pertained under the old regime. Central funds are no longer available to support this and decent clinics are only available to those who can pay. I have no doubt this is a true picture. However, market reforms will undoubtedly continue and so will the cultural revolution. Obviously, we do not want to support a return to the old draconian powers of compulsory hospitalisation and contact tracing. That is not an option. So the question is, what can be done in the present context?
But before attempting an answer I feel I should pose a prior question. Is any of this our business? In response to this, I would like to make it plain that I am not an unqualified supporter of all public health initiatives, especially those which seem to intrude unduly into people's lifestyles where no serious risk to others is concerned. However, infectious disease does seem to me a legitimate public health concern, and there are clearly no geographical boundaries where they are concerned. That is why we have international agencies such as WHO and UNAIDS to co-ordinate the response to transnational public health threats. But such agencies are only as effective as their constituent parts, which means the member states by which they are funded. There is precious little they can do other than exhort and cajole, unless the political authorities of their member states are prepared to finance and implement their recommendations. To that extent, I would argue that the epidemics which are the subject of this question are our business, as members of and subscribers to the international agencies concerned.
It is also our business in terms of self-interest. What is now a relatively benign HIV and AIDS situation in Northern Europe, owing to the successful strategies we have adopted, could seriously worsen if a large number of HIV cases develops, riding on the back of syphilis, across the broad swathe of countries to the east of the current European Union. Of course, the EU has no common border with the newly independent states of the former Soviet Union, but that is not much protection
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in a period of migration of labour and internationally organised prostitution, which know no boundaries. Fortress Europe might be able to keep some tariff barriers up but it can be no protection against disease.
There is also the important dimension of enlargement of the Community to which the noble Earl, Lord Carlisle, referred, which will bring in a number of states that do have common borders with the FSUI apologise to him for the use of that phrase, but it seems to have crept into usage—in some of which those epidemics are already showing signs of taking off, as he said.
It was therefore a matter of some surprise and concern that there was no representative from either the European Commission or the European Parliament at the founding meeting of the "task force for urgent response to epidemics of sexually transmitted disease in Eastern Europe and Central Asia", organised by WHO in Copenhagen on the 23rd/24th February past. The World Bank was there. UNAIDS and other UN agencies were there. The United States Agency for International Development was there. Norway, Sweden, Denmark and Germany were there. Our own Know-how Fund was there. Medécins sans Frontieres was there. But no one was there from the EU, on whose doorstep these events are happening. That does seem rather extraordinary, especially as the Commission acquired a new public health role under the Maastricht Treaty, to which I shall return shortly.
Leaving that on one side for the moment, what can we ourselves do? What can the UK do? I am pleased to say, as the Minister will know, that I had a very positive letter from his right honourable friend Clare Short. the Secretary of State for International Development, in support of a seminar I organised on this issue on 25th February. It was well attended by representatives of her department. In her letter, the Secretary of State wrote:
"I share your concern about the dramatic resurgence of syphilis and other sexually transmitted diseases in Eastern Europe and the former Soviet Union"—
I am afraid that the Secretary of State also uses that phrase—
"particularly when the link between untreated STDs and susceptibility to HIV infection is so devastatingly clear".
She continues with the welcome news that,
"DfID expects to do more in this area".
I have heard of the work by the Know-how Fund in certain Russian locations, which I applaud, but it would be interesting to hear from the Minister what form the crucial word "more" is going to take.
I have also had a letter from the public health Minister, Tessa Jowell, replying in encouraging terms to a letter of mine suggesting that this matter be placed on the agenda for discussion at the next Health Council on 30th April. She wrote to me stating:
"I share your concern … We will be holding a general discussion of the future priorities for the EU in the field of public health at the Health Council on 30th April, and I am sure that in that context the worrying rise in the incidence of STDs in Eastern Europe will be raised as an issue".

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She then refers to a conference which the UK presidency is sponsoring on 19th May in London and she mentions that the Government are considering the possibility of co-hosting with the European Commission a meeting on 28th May to which health ministry officials of applicant countries will be invited.
It is certainly welcome news, after their disappointing absence from the task force foundation meeting, that the Commission seems to be involved and if the Government have played a part in this they are to be congratulated.
I wish to ask the noble Lord, Lord Whitty, whether he can clarify the Government's intentions in the following respects. First, what further action will the Government take to stimulate action by the European Union? I understand that the Community is close to agreeing a decision which will establish a network for communicable disease surveillance. Can he say how that will operate and whether it will extend to associate and applicant states? If not, there will be little advance on the surveillance arrangements which already operate among the 15.
Secondly, will the Government participate actively in the work of the task force? If so, how do they think they can make the most impact? We have a wealth of experience in this country in the operation of genito-urinary clinics based on confidentiality and free access to treatment, which sounds exactly what is required in the former Soviet Union and other affected states. We are also good at outreach programmes through voluntary agencies working with people such as prostitutes and drug users who want to have nothing to do with the official system. These are extremely cost effective and they reach the parts other lagers do not reach. Is it within the remit on DfID to contribute to such voluntary bodies? In areas where we have undoubted experience and expertise, I would suggest that bilateral aid is probably the best route.
Thirdly, as the noble Lord, Lord Rea, mentioned, the health Minister has agreed that STDs in central and eastern Europe merit discussion at the next Health Council, hut the topic could easily be crowded out by other business. Will the Government undertake that it will be raised by the UK from the chair?
Fourthly, what liaison is taking place between the lead government departments on this bundle of issues? It is already clear that both the DfID and the DoH have an involvement in the field. This might extend to the Home Office if immigration matters arise. It would be a great pity if the undoubted efforts that the Government are making were not co-ordinated to maximum effect. Can the Minister say what machinery exists to ensure that the departments involved pursue a common strategy, especially in the international arena?
Finally, I do not believe that the major international initiative, called for by Dr. Dehne, from whom I quoted earlier, need be massively expensive. The Commission already runs the Europe Against Aids programme based on the principle of subsidiarity; that is to say, it contributes to useful schemes and initiatives in member states for which about 10 million ecu (£6 to £7 million) are allocated annually across the Community. The
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trouble is that that is confined exclusively to the current 15 member states. The European Union is also the largest donor for AIDS control in the developing world. Unfortunately, the area we are discussing, with which we share a land mass, appears to fall between the two stools of Europe and the third world. I suggest that a sister programme could be devised, using voluntary and other bodies already in existence, at a relatively low cost which could be good value for money.
There is a good basis for that at paragraph 3 of Article 129 of the Treaty of Maastricht, which states:
"The Community and the Member States shall foster co-operation with third countries and the competent international organisations in the sphere of public health".
I ask the Minister whether, during the United Kingdom's presidency, the Government will pursue that idea with the Commission with a view to establishing a programme which is fully targeted on the area that we are discussing this afternoon.
2.25 p.m.
Lord Alderdice: My Lords, we are all grateful to the noble Lord, Lord Rea, for his initiative in bringing forward this important matter. He has, as have other noble Lords, outlined the nature of the problem in some detail. However, there are a number of further matters I should like to raise. I hope that the Minister will be able to give us some guidance in respect of one or two questions, particularly those outlined by the noble Lord, Lord Kilmarnock.
A few years ago there was enormous concern in this part of the world about the developing pandemic of HIV and AIDS. A considerable programme of education and disease control was embarked upon. It is encouraging to see that in the countries of northern and western Europe there has been an element of control over the epidemic. I fear that the very success of that may have blinded us at times to the fact that that has not been the case in the countries of south-western Europe and in much of the rest of the world, not least in central and eastern Europe, as the noble Lord's Question points out. For example, while the incidence of syphilis and gonorrhoea has declined in western Europe, the incidence in the former Soviet Union countries has increased from something like five per 100,000 in 1990 to 170 per 100,000 in 1995. Those are the most recent figures I have; clearly, they have continued to increase. In particular, if one looks at the Ukraine, the vulnerability of that country is demonstrated by the fact that between 1991 and 1995. the number of syphilis cases increased ten-fold. Therefore, we are looking at a very serious increase in the number of sexually transmitted diseases. We are not just talking about syphilis. We are talking about gonorrhoea, chlamydia, trichomonas and of course. HIV and AIDS.
There has been some discussion about the reasons. I shall not enumerate all of them. But, of course, there have been dramatic changes in society in central and eastern Europe: the relative freedom to travel, the changes in social mores, and the development of organised crime, to which I shall return later, which involves the sex industry and the drugs trade, a very important component in respect of HIV and AIDS.

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But there is another difficulty. The education programme embarked upon in that part of the world, which was markedly successful, led to a change not only in the pattern of people's behaviour but, of course, in the use of condoms as a protective device. Very little is known about the availability of condoms in central and eastern Europe but we know that in certain areas they are very restricted, simply for commercial reasons. For example, in Kazakhstan in 1995, they were available only in some pharmacies in the capital city. Moreover, in Moscow that same year, although condoms were available at most pharmacies and could be found at some commercial kiosks, supermarkets and hotels, the price of a 12-unit pack represented nearly one-third of the minimum monthly salary—a pretty expensive business in terms of protecting oneself.
I believe this to be a very important issue. Whatever the educational programme embarked upon, we should bear in mind that the very simple, straightforward and readily available precautions which may be taken in this part of the world may not be available in other places if provision is not made in that respect. I remember visiting South Africa three or four years ago. I visited a market in Johannesburg and was approached by a very pleasant young lady who supplied me with leaflets and a number of packs of condoms, as, indeed, she was supplying to everyone in the marketplace as part of an educational programme. The point is that it is okay to have the education but, if the condoms are not freely and cheaply available, then at least some of that educational component will not be successful.
When speaking about syphilis and the development of that epidemic and HIV, we must bear in mind the relationship between them because both are sexually transmitted diseases. The acquiral of syphilis, as the noble Lord, Lord Rea, pointed out, leaves one even more vulnerable to HIV because of the ulceration, but it is also true in cases of gonorrhoea, chlamydia and trichomonas that the inflammation leaves one more open to HIV.
The major increase in HIV in central and eastern Europe has not come about simply through sexual transmission; it has come about because of the enormous increase in the drug problem in that part of the world and the massive increase in HIV among intravenous drug users. I recently received figures which showed that the incidence of HIV among intravenous drug users in one part of the Ukraine rose from 1.7 per cent. in January 1995 to 56.5 per cent. in December; that is, 11 months later. So in a period of less than a year the incidence of HIV among intravenous drug users in one city had gone from 1.7 per cent.—almost nothing—to cover well over half of the intravenous drug users. We know that the incidence of intravenous drug abuse has massively increased in the former Soviet Union. That is not just because of availability. It is because many people have turned not to legitimate capitalism but to illegal organised crime.
We all know that organised crime in any part of the world involves itself in money laundering, in threats and intimidation, in the drug trade and in the sex industry. Of course, the latter is an important link in respect of
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all these diseases. I raise the point because, when it comes to the question of what we in this part of the world might fear and do as a result, there are important implications not only in health terms but also in terms of the control of organised crime. The freedom to travel makes it much more likely that travellers from this part of the world who are foolish enough may find themselves contracting infections when they visit the countries of central and eastern Europe. Similarly, those who visit us from central and eastern Europe may bring such infections with them. Indeed, that is a serious issue and a serious health problem.
There is also the danger to all of us not only through the development of a serious pool of infection in central and eastern Europe, which might then spread to the rest of us, but also through the development of a massive pool of organised criminal activity—for example, peddling sex and drugs. That is a major threat to us, because those who are intent upon making a profit out of organised crime and drugs will not be satisfied merely to keep their activities to those countries. We already know that there have been attempts to expand such activities to this part of the world. Of course that is a serious matter.
It is a matter of considerable disappointment to note—as the noble Lord, Lord Kilmarnock, did—that when the task force was established as recently as February this year the European Union was not represented on that occasion despite being invited. I hope that in his reply the Minister can advise us why that was the case and can assure us that during our presidency of the European Union that kind of neglect simply will not be allowed to continue, and that in approaching this question we shall not simply restrict ourselves to public health measures such as the provision of condoms, needles, syringes and the provision of an educational campaign. We have achieved success with our campaigns and we can transmit that success to others.
I hope the Minister can assure us that the criminal side will be taken into account and that there will not merely be collaboration by health and preventive health agencies but also co-operation between police organisations, the Home Office and ministries of justice in other places. I hope that that side of the matter will be given serious consideration and that there will be co-operation between security agencies and health agencies. That is the big link between all these different diseases whether they are sexually transmitted, or transmitted in even larger numbers in central and eastern Europe through the use of intravenous drugs. I look forward to the Minister's response.
2.45 p.m.
Lord Lucas: My Lords, I, too, am grateful to the noble Lord, Lord Rea, for initiating this debate and for the help that the noble Lord was able to obtain for me from Dr. Renton, who has also been most helpful to me. I extend my congratulations to the noble Lord, Lord Whitty, on his appointment as a spokesman with responsibility for sexually transmitted diseases. I hope he will find that post a healthy one!

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As many speakers have said, what these countries of eastern Europe are facing is a change of system and a breakdown of the old controls that used to keep these diseases suppressed, and a consequent epidemic. As has been said, syphilis has increased by a factor of 200 and has reached levels which might truly be called epidemic. We are looking at about one quarter of 1 per cent. of the population being actively infected. That might translate into half a dozen Members of your Lordships' House. I think we would recognise that as an undesirable number.
I do not share the worries of the noble Lord, Lord Rea, about "tarts" bringing syphilis into this country. I think the arrangements we have here for dealing with syphilis keep it very much under control. I do not think there is any danger of an epidemic starting or spreading here. Nonetheless we should consider whether we can help the former Soviet Union overcome the problems it faces.
As regards AIDS, although increases have been dramatic, the level of AIDS in the former Soviet Union and eastern Europe is much lower than it is in western countries. In Russia it is about a hundredth of the level that it is in the UK. Therefore we are not facing an epidemic, but from what has been said today it is clear that we are facing a potential epidemic. As the current level of the disease is low, we have the opportunity to move fast now to do something about it and to prevent it reaching the stage that it will undoubtedly reach if we do nothing about it.
What can be done? I think President Museveni was correct in attributing AIDS and all sexually transmitted diseases to a change in people's practices and habits. That is the root of the problem. The way forward must be through education and through providing examples of how systems can work. Russia faces enormous problems, not least that of raising taxes with which to pay doctors to treat sexually transmitted diseases. I hope the noble Lord, Lord Whitty, will confirm that there is not scope for us to spend large sums of money trying to solve these problems, which relate fundamentally to major structural problems within Russia and the other countries of the former eastern bloc. Those problems have to be solved by those countries themselves, perhaps with the aid of other streams of help from us. For us simply to throw money at the problem will be nothing but counter-productive.
I hope that the noble Lord, Lord Whitty, will be able to confirm that the new emphasis of DfID on poverty elimination will not prevent it from helping with this problem in what is fundamentally one of the richer countries of the world. As the World Bank and the European Union have acknowledged, market mechanisms cannot deliver effective control of such an epidemic in the Soviet Union because those most affected are those with the least resources. It is effectively the poor within those countries, who do not have access to such wealth as would be available in a country like the United Kingdom to deal with the problems they face. I hope that the noble Lord will allay one of my long-term fears about DfID's new policy: that we shall still feel able to devote resources to this sort of problem.
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There are several things that the UK should do. First. as has been said by several speakers, we should support the WHO task force. I hope that we shall have a clear and unequivocal statement from the noble Lord on that. Secondly, I hope that the Government will promote awareness of the issue within the European Commission. Many speakers have raised the problem. The European Union spends many millions on projects in Africa and Asia to promote sexual health but seems to have no mechanism to do the same in eastern Europe. That may account for the absence of those from eastern Europe from the opening session of the WHO task force. I hope that the Minister will confirm that we are determined to do something about that during our presidency of the European Union.
The HIV epidemic is at an early stage when it would respond well to intervention. We and the Europeans have a great deal of expertise in that area. It is clear that those involved in the former Soviet Union would much prefer to work with representatives from the European Union. From their cultural backgrounds, they would have a better understanding of life in the former Soviet Union and its culture than the Americans who already work there. It would be a shame if we were not able to participate because of some structural technical deficiencies within the European Union.
Thirdly, I hope that the noble Lord will enlarge on what DfID is doing to help. The noble Lord, Lord Rea, gave some examples. My noble kinsman Lord Carlisle praised the work of the British Council. I hope that we shall hear more from the Minister on what is being done. Projects led by DfID to enhance the health of local populations, to serve as models for wider development, and to support the case for reforms within the system, would be an excellent way forward. The United Kingdom is particularly good at delivering low cost but highly effective and widely accessible STD services. We have struck an excellent balance between high and low-tech services. In Russia doctors may be more concerned with the latest diagnostic test than in using the available resources in a modest but effective way. Health promotion and education activities are often neglected as they have no high-tech appeal. We can show that our model, which does not rely on a high-tech but a more down to earth public health approach, is highly effective.
We are also good at working with hard to reach, marginalised and sometimes criminalised groups in society. That would apply in particular in Russia to sex workers, migrants, homosexual men and drug users, all groups with which we have had considerable success in this country. We have strong experience in local rapid public health research to develop tailored local intervention strategies. Such a structure is not in place in the Soviet Union. Some seedcorn from us would help a great deal.
We can help, too, in developing humane medical practice which shows respect for patient confidentiality and human dignity. That was not a feature of the old regime in the Soviet Union. I am sure that we can do much to encourage it.
I look forward to the reply of the Minister. I hope that he will give encouragement to us all.
2.55 p.m.
Lord Whitty: My Lords, this has been a serious and sombre debate. We should thank the noble Lords, Lord Rea and Lord Kilmarnock, and others who have taken a deep interest in this area, and the organisations with which they have been involved and the experts to whom they themselves paid tribute during the course of the debate. To be honest, I was not fully aware of this area before I undertook the briefing and research for this debate. I have been further enlightened by the contributions from your Lordships.
This is an immensely serious problem on the doorstep of Europe, and one which adds to the serious tensions within the countries of the former Soviet Union (if I may briefly use that term) and beyond. It behoves the authorities within those countries, and those in western Europe who are in a position to help them, to give greater priority to this issue. As the noble Earl, Lord Carlisle, indicated, the Estonian authorities are now aware of the problem. I am informed that the Russian authorities have only recently updated the statistics referred to by the noble Lord, Lord Alderdice.
The figures given by the Deputy Minister for Health, Gennadi Onishchenko (at least, I believe he is still the Deputy Minister for Health—I am not sure what President Yeltsin has done with him) indicate that the rate of notification of syphilis is almost 300 per 100,000 of the population as of February this year. That is a significantly higher rate than in Britain before the application of penicillin. It is also significantly higher than the rate in many of the very poor countries in Africa where there are serious problems of STD. The overall rate is higher in certain areas—in Siberia for example—and in cases of young people, particularly young women.
Those notification rates are continuing to increase in almost all the countries: Russia, Ukraine, central Asia and the Baltics. Admittedly, as has been stated, the rate of HIV infection is relatively low in those countries at the moment; but the rate of syphilis and other STDs indicates the very real possibility that HIV transmission in the region will rise very rapidly over the next few years.
I assure the House that Her Majesty's Government share the concern of noble Lords about this appalling situation. The Department for International Development and the Department of Health are taking serious steps—both bilaterally and in collaboration with multilateral organisations—to help governments reduce the transmission of STDs and HIV/AIDS. They are also assisting them to provide cost-effective treatment to those already infected.
DfID's main channel for bilateral assistance—the Know-how Fund—is helping the Russian Government develop a co-ordinated, public health strategy for STD control throughout the Federation, and is helping Samara Oblast to establish a more effective "model" STD service. We are also working with the health department in Sverdlovsk Oblast to develop a strategy to prevent the transmission of HIV among intravenous
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drug users. As noble Lords rightly said, that is the main means of transmission at present. That assistance will, it is to be hoped, make STD and HIV prevention services more accessible to poor and marginalised groups (the homeless, unemployed and migrants) who experience a particularly high incidence of STDs and HIV.
Elsewhere in the region, the Know-how Fund is supporting efforts by international organisations to improve reproductive health services. Support extends from Latvia, to improve the availability of contraceptives through social marketing, to Kazakhstan and Kyrgystan in central Asia, where national governments use British know-how to develop sex education strategies, particularly for adolescents.
In addition to British Government efforts, the World Health Organisation has a vital role to play. The Department for International Development is supporting the task force referred to by noble Lords. It not only funds participants in the task force, but will also provide financial support to the secretariat. I shall say more about some of those initiatives in a moment.
The noble Lord, Lord Kilmarnock, asked: is it our business? He clearly answered the question—yes, it is our business. The problem is already affecting western Europe and the UK. Dr. Alexei Gromyko, who is the WHO's adviser in STDs and Aids for the European region, has recommended that the countries of the European Union support concerted public education campaigns for the whole of Europe, western as well as eastern Europe. We shall be pursuing that.
There is already evidence that a proportion of western Europe's cases of infectious syphilis are associated directly with transmission in Russia and elsewhere in eastern Europe. A recent report on syphilis infection in England and Wales between 1994 and 1996 states that 20 per cent. of UK cases were already associated with transmission from the former Soviet Union. Moreover, there are long-term implications for eventual increase in HIV transmission from the same source. We know from our own Landmark research in Tanzania, which was supported by the British Government and the European Union, that the presence of STD greatly increases the risk of HIV transmission, by a factor of three to five, and prompt and effective treatment of sexual infections can lead to a reduction in HIV transmission.
The incidence of HIV is increasing dramatically, from a fairly low level. In the Russian Federation there were 3,841 official notifications in 1997, but in January 1998 alone there were 6,378—in other words, twice the previous year's level in one month. The deputy minister for health said that he feared an AIDS surge in Russia. He implied, moreover, that the actual number of new cases could be as much as 10 times higher than official notifications and that we should not be deceived by the relatively low reported levels.
Noble Lords have referred to the reasons for this in Russia and central Asia: the enormous social and economic changes; migration; sexual mores; and, as the noble Lord, Lord Alderdice, stressed, the nexus of prostitution, crime and drugs in those unhappy parts of the world. Changes have been very rapid and have

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undoubtedly increased the tendency to unprotected sex and casual treatment of relationships and are associated in many cases with casualisation of life, migration, alcoholism, suicide, crime and divorce. Those are all part of the same problem—namely, the disintegration of much of society in Russia.
Another part of the problem relates to the state of health services within Russia. A relatively substantial provision not only has been discredited but is also not being used by the population. Historically, the level of STD surveillance was centred around a nationwide clinical service controlled by the ministry of health which was fairly draconian in terms of its identification and treatment. That has largely been rejected by the Russian population, who are no longer willing to subject themselves to stigma, sanctions and archaic and painful treatment. This has led to a rapid growth in poor quality, private sector STD treatment and also in self-medication, much of which is totally ineffective.
The noble Lord, Lord Lucas, asked whether we would throw money at the problem. It is clear that substantial resources in Russia are still being spent on health, but they are being spent ineffectively. Expertise, technical advice and capital help from both public and private sources is in many cases the most important way in which we can help, expertise perhaps being more important than money.
In terms of the British Government's response to this crisis, there are clearly some things we can do on our own and much that we can do through the WHO and the UN and potentially through the EU. We have substantial experience and technical qualifications. We have the experience of our AIDS education process and the STD services and information to which the noble Lord, Lord Alderdice, referred. Much of that is relatively easily transferred to other countries provided we can establish the networks and the willingness to learn and listen.
Starting from scratch, at the beginning of this year as we became increasingly aware of the crisis, the Department for International Development now expects to invest up to £1 million in helping the Russian Government to develop a comprehensive strategy for combating sexually transmitted diseases. That will
include some of the projects to which I referred. It will also include assistance to health departments in various parts of Russia and help to develop strategies for preventing the spread of HIV among intravenous drug users. That will comprise primarily a health promotion campaign aimed at intravenous drug users, peer group counselling and the development of targeted health services, of all of which we have substantial experience in this country. It could serve as a model for other cities in Russia and other countries where HIV transmission through intravenous drug users is the most serious problem.
There may be other areas in which we can help. I was taken with a reference by the noble Lord, Lord Alderdice, to the supply and price of condoms, which is an obvious but important aspect of the control of the transmission of these diseases. We are already helping in both Latvia and Moscow to try to develop the social marketing of condoms and we should perhaps
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look at developing that area in association with some of our partners. The Know-how Fund, to which I referred, is already providing substantial assistance in Russia, in St. Petersburg in particular, and in Kazakhstan, and elsewhere is providing sex education. In Latvia the social marketing of contraceptives is being supported. The Know-how Fund is not a money fund: it is primarily a fund which provides expertise and technical help.
There is also the whole question of research and knowledge generation and new technologies and innovative health approaches are needed. We are making a significant contribution in those areas as well. We are supporting the MRC's action in search of an HIV vaccine and we are also supporting work at the London and Liverpool Schools of Hygiene and Tropical Medicine.
In terms of the work that is being done with the World Health Organisation, the DfID representatives are fully engaged in that work, and British expertise will be used. The task force to which noble Lords referred recommended urgent action for the control of potential STD epidemics in the region. It focused on prevention and health promotion designed particularly for at-risk groups and implementing a public health strategy for controlling STDs, with stress on access, confidentiality and the integration of STD care with primary and family planning sectors. The World Health Organisation is clearly the main multilateral organisation for transmitting those efforts.
A number of noble Lords criticised the lack of activity within the European Union on this matter. My honourable friend the Minister for Health. Tessa Jowell, has taken on board the problems within this area and agrees that some consideration at European Union level will be taken; whether or not the 30th April Council meeting is the appropriate point is not clear. It is not at this point on the agenda. She has certainly undertaken to pursue that issue with her colleagues.
It is true that the powers of the European Union are relatively limited in this area under the article in the Maastricht Treaty referred to by the noble Lord, Lord Kilmarnock. They will be extended slightly under the Amsterdam Treaty, but that has not yet been ratified. Much will depend on the efforts of member states acting collaboratively rather than through the European Union itself. Nevertheless, we agree that the issue should receive greater prominence in the public health strategy of the European Union in conjunction with other activities which are being pursued under the British presidency. These relate particularly to the drugs trade, the trafficking in women and other sex trades and other international crime. These are issues which my friends in the Home Office and elsewhere are pursuing with their colleagues in our war on international crime during the British presidency. Much of that relates to the problems that arise in this area. In addition, noble Lords referred to the UNAIDS programme, in which we are participating fully and trying to mobilise both agency, NGO and private sources in order to tackle the problem.

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We sometimes forget in this country that we are in a privileged position in that our free and open access to genito-urinary medicine and clinics ensure that confidential information, testing and treatment for all sexually transmitted diseases is readily available to us and to visitors. That was not the case under the old Soviet Union and it is not the case in the newly independent states. We also carry out national and local health promotion campaigns for HIV and other sexually transmitted infections. We are committed to transferring
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this experience to partners in eastern and central Europe. We are working with WHO and UNAIDS to support national governments as they develop effective public health responses to these threats. If I have not answered points raised by noble Lords, I shall check Hansard and write to them. However, I think that what I have said indicates our concern about these epidemics and our determination to ensure that we use all means to help those countries to tackle the serious social and medical problems that they face.
House adjourned at eleven minutes past three o'clock.