Lords Sitting of 28 January 1999

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

Meningitis
Baroness Masham of Ilton Baroness Masham of Ilton asked Her Majesty's Government:
Whether there are sufficient facilities and expertise to provide for patients suffering from meningitis; and whether the level of research being carried out into the causes of meningitis is appropriate.
The Parliamentary Under-Secretary of State, Department of Health (Baroness Hayman): My Lords, effective treatment of meningitis requires prompt and accurate diagnosis by front-line staff, backed up by appropriate specialist support. That is why the Chief Medical Officer wrote again last week to all doctors reminding them of the key features of meningococcal disease and how suspected cases should be treated.
Much research is already being undertaken into the causes of meningitis. Additionally, the Government give priority to research into prevention. The Department of Health has been funding research over recent years into new vaccines and has recently added an extra £l million to accelerate that research.
Baroness Masham of Ilton: My Lords, I thank the Minister for that reply. Is she aware that there is intense anxiety up and down the country, from the very tip of the north of Scotland, where children have died, to the south of England? Does she agree that there are insufficient intensive care beds? It is tragic that seriously ill patients have to be shuffled around the country.
Baroness Hayman: My Lords, I certainly agree with the noble Baroness that there has been great anxiety because of the absolute urgency of prompt diagnosis. It is a particularly worrying disease for parents. The paediatric intensive care system in this country is better equipped to cope now than it ever has been in the past. The Government have acted on the review with which they were presented when they came into office and have expanded facilities and put more money into them. Because of the specialist nature of the services, it is not appropriate and it would not be right to have them available at every district general hospital or with every paediatric unit. Therefore, it is extremely important that we have the necessary retrieval services so that very sick children can be transported safely. We are taking action to ensure that that is happening in every region.
Lord Astor of Hever: My Lords, when does the Minister expect to have the results of trials of the new conjugate vaccine against meningitis C?
Baroness Hayman: My Lords, I am afraid that I cannot give the noble Lord a precise date for that. As
1128
I said in my earlier Answer, we are greatly encouraged by the progress of research into that vaccine. The current C vaccine is not appropriate for wide-scale use. The collaborative research in which we are taking part suggests that we are very close to producing something. Obviously, we must wait for the completion of the studies. There are licensing, manufacturing and resource issues. But Britain is leading the world in that research and the situation is looking extremely hopeful at present.
Lord Clement-Jones: My Lords, I welcome many aspects of the Minister's reply, particularly as the father of a small child. Is the Minister satisfied that there is adequate public education about the warning signs of meningitis? Furthermore, is she satisfied, particularly in the light of the report of this House to which the Government have responded, that all steps are being taken to ensure that current antibiotics retain their effectiveness?
Baroness Hayman: My Lords, the noble Lord rightly pinpoints the importance of general policy on antibiotics because in this situation antibiotic treatment is effective and it is very important that it is given promptly.
As regards public information, within the Department of Health we work collaboratively with the voluntary organisations which are particularly active in that field in trying to give advice to parents and, in particular, to the teenage generation who are at risk. There has been an extremely effective campaign on campuses to alert young people to the signs and symptoms of meningitis. We have all had illustrated to us recently how crucially effective an individual's knowledge of the signs and symptoms of the disease can be in averting tragedy.
Lord Morris of Manchester: My Lords, there have been many press reports on some distressing cases over the past year. Is there any comparative information about previous years which my noble friend can give the House?
Baroness Hayman: My Lords, my noble friend points out that there have been press reports, as, indeed, there are every winter because we tend to see a winter peak of meningococcal infection. As far as we can tell from this year's figures, they are not particularly out of line with those of the past two or three years. There was an increase which was steeper than we would normally expect in the first two weeks of the year. I am glad to say that the number of notifications for the third week in January has actually gone down.
Baroness Gardner of Parkes: My Lords, is the Minister aware of the work of the Meningitis Trust based in Stroud, where the first publicly acknowledged cluster of cases occurred, following which the trust was set up? Does she acknowledge that it plays a valuable role in both an informative and supportive way?
Baroness Hayman: My Lords, I recognise the role that both the Meningitis Trust and the Meningitis Research Foundation play in this field. Indeed, my colleague, Tessa Jowell, opened a counselling suite at

1129
the Meningitis Trust last week. Many parents have been very grateful for the advice that they received from those organisations.
Baroness Ludford: My Lords, is the Minister aware that one area of concern is when professionals do not believe parents when they say that their children are ill, especially because time is of the essence? Will she issue guidance on that matter to professionals in the health service? The noble Baroness talked about individuals recognising the symptoms; in the case of small children, that would be the parents. Can guidance be issued to professionals on that matter?
Baroness Hayman: My Lords, it is not appropriate for me to do so, but the Chief Medical Officer wrote to professionals in January, as he writes every year. This year he was highlighting the key signs to look for not only to GPs, but also, which is as crucially important, to those working in A&E departments who may be presented with a sick child. Action therefore is being taken on that front.
Lord Rea: My Lords, following my noble friend's earlier answer on vaccine development, can she tell us about vaccines against the B type meningococcus, which is one of the major causes of recent outbreaks? In that work, are we collaborating scientifically with Cuba whose microbiologists produced the best vaccine so far available against that specific variety of the organism?
Baroness Hayman: My Lords, the research to which I referred earlier related to meningitis C rather than meningitis B. The research on the B organism is less well developed. We are collaborating with Dutch national vaccine manufacturers to develop and evaluate a group B vaccine. Though I am aware of Cuba's success—indeed, the Department of Health met with officials from the Cuban Ministry of Health—as I understand it, the Cuban vaccine, which is extremely efficacious in Cuba, has not been so effective in other countries, especially in young children, as it is formulated against a different strain of the B organism than that which we encounter in this country.
The Earl of Dudley: My Lords, I have some personal experience of the relevance of this Question. Can the noble Baroness say what action is being taken by the public health authorities to identify possible contacts with carriers in the event of an outbreak?
Baroness Hayman: My Lords, I am not certain that anything is done by the Public Health Laboratory Service in that regard. It is particularly crucial, because of the nature of outbreaks in circumstances where young people are often away from home and living in communal facilities for the first time, for universities and colleges to be aware of the need to work collaboratively with health authorities if
1130
individual cases occur in a school or college so that proper, effective measures can be taken. We have a vaccine which will work for the short term, but it is not effective for long-term immunisation

Nuclear Weapons
3.17 p.m.
Lord Jenkins of Putney Lord Jenkins of Putney asked Her Majesty's Government:
Whether their two policies of maintaining the nuclear deterrent and eliminating nuclear weapons are consistent, and whether their vote for the former at the United Nations was in conflict with the latter.
The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Baroness Symons of Vernham Dean): My Lords, as the Strategic Defence Review made clear, the Government wish to see a safer world in which there is no place for nuclear weapons. We have promised to retain Trident as the ultimate guarantee of our national security, while pressing for multilateral negotiations towards balanced and verifiable reductions in nuclear weapons. We have made absolutely clear that when we are satisfied with progress we will ensure that British nuclear weapons are included in negotiations.
There is no inconsistency in this approach, nor have any votes we have recently cast at the United Nations been in conflict with it.
Lord Jenkins of Putney: My Lords, does my noble friend agree that no nuclear nations will find difficulty in accepting the seriousness of Her Majesty's Government's commitment to this matter unless the Government are prepared to put forward a programme as to how they propose to reach that point? Will they consider tabling a Motion in the General Assembly and raising the matter in the Security Council or even in NATO? We can then have some idea of how the Government expect to proceed and their desire to reach the stage of elimination of nuclear weapons can be taken seriously. We may then accept that they do not place the retention of Trident above that.
Baroness Symons of Vernham Dean: My Lords, I do not believe that anybody will have problems with the consistency of our approach. We did not support the specific resolutions to which my noble friend referred because we did not believe that they were practical and that that would have been consistent with the maintenance of our credible deterrent. There is an impressive programme and substantial agenda on nuclear disarmament ahead of us in 1999. The Government's view is that the most important aspect of that is the negotiation in the conference on disarmament for a treaty to end the production of fissile material for nuclear weapons or other nuclear explosives. We have already called a moratorium on that in this country and, uniquely, we declared our stocks of such fissile material. It is also important to

1131
see the ratification of START 2 and that those countries which have not yet signed the test ban treaty do so. We are lobbying them to do so soon.
Baroness Williams of Crosby: My Lords, can the Minister tell us a little more about the procedures in regard to START 2? Can I draw attention in particular to the serious problems facing the Russian Federation in terms of protecting and safeguarding its own substantial stock of nuclear missiles? They include those from other former CIS countries that were repatriated to Russia. Can the noble Baroness comment on what steps might be taken to assist them?
Baroness Symons of Vernham Dean: My Lords, as the noble Baroness will know, START 2 still awaits ratification by the Russian Duma. We had hoped, as, indeed, had the Russian Government, that the Duma might ratify the treaty last December. In the event, we understand they are now hoping to do so in the spring. The Russian Government have assured us that they remain committed to it and that they will do everything they can to secure ratification. The Russian and the US Governments have made it clear that they are determined to move rapidly to negotiation on START 3 once START 2 is ratified. The outlines of such a treaty have already been agreed by President Yeltsin and President Clinton in part to help to try to achieve ratification by the spring.
Lord Chalfont: My Lords, does the Minister recall that as recently as last November, her noble friend Lord Gilbert, in his speech in the debate on the humble Address, made a clear, intellectually respectable proposition about the policy of Her Majesty's Government in that connection? Does she also agree that if we follow to its logical conclusion the implications of the proposition put forward by her noble friend Lord Jenkins, a policy of general and complete disarmament could not be pursued while we still have an Army, Navy and Air Force? Does she finally agree that this demonstrates, once again, that her noble friend is either unable or unwilling to recognise the difference between multilateral and unilateral disarmament?
Baroness Symons of Vernham Dean: My Lords, I am delighted to be able to agree that my noble friend Lord Gilbert put forward an intellectually respectable argument, as, indeed, he always does—and I do not believe that he is unique on these Benches in so doing.
Her Majesty's Government made some very significant steps last year towards fulfilling the commitments we made to the British people in our election manifesto. We withdrew the freefall bomb in March last year. In April last year, we ratified the Comprehensive Test Ban Treaty. The Strategic Defence Review last year resulted in reductions of more than 70 per cent. in potential explosives, and in August last year we welcomed the establishment of the ad hoc committee to negotiate on fissile material.
1132
I believe that we have been entirely consistent. I do not accept the argument of my noble friend Lord Jenkins and I hope that I have been able to demonstrate why.
Lord Burnham: My Lords, can the Minister throw any light on the situation at the nuclear processing plant at Drake in Cumbria, which I understand has had to stop receiving any nuclear materials because it has been discovered that that plant exceeds the amounts of carbon 14 allowable for the next 25 years?
Baroness Symons of Vernham Dean: My Lords, I am afraid that I am unable to shed any light on that matter. However, I understand from my noble friend Lord Gilbert that he hopes in due course to be able to do so. I understand that the noble Lord has tabled a Question specifically on that issue which will be answered in due course.
Lord Archer of Sandwell: My Lords, does my noble friend agree that the very worst thing that could happen would be if a wedge were driven between the nuclear and non-nuclear powers so as to preclude any further agreement on the way forward? Can she assure us that the Government are fully alert to that danger?
Baroness Symons of Vernham Dean: Yes, my Lords, that is an important point. I assure the House that although the Government were unable to support the "new agenda" resolutions, as they have been referred to, we were able to support, for example, the resolution tabled by Japan on the ultimate elimination of nuclear weapons and that by the United States and Russia on the importance of bilateral arms negotiations. We have also supported resolutions on nuclear weapon-free zones in central Asia, Latin America, the Middle East and Africa, so I believe we have been conscious of the dangers which my noble and learned friend describes.
Lord Mackie of Benshie: My Lords—
Noble Lords: Next Question!
The Lord Privy Seal (Baroness Jay of Paddington): My Lords, as the clock is now showing that 16 minutes have already elapsed, I think it is time that we moved on to the next Question.

Gulf War Illness Research Unit: Study
3.24 p.m.
The Countess of Mar The Countess of Mar asked Her Majesty's Government:
What is their response to the results of the epidemiological study conducted by the King's Gulf War Illness Research Unit.
The Minister of State, Ministry of Defence (Lord Gilbert): My Lords, we welcome the results from the King's Gulf War Illness Research unit study. It was the first large-scale study on this subject carried out in this country, and these results, therefore, represent an important milestone in our understanding of UK Gulf veterans' illnesses. Among other actions, the MoD is asking the Medical Research Council for its advice on our future strategy in the light of the two papers' findings.
The Countess of Mar: My Lords, I am grateful to the Minister for that reply. In view of the fact that the Medical Research Council stated some three years ago, I believe, that there was no need for causal research, and the fact that Professor Wessely, at the press conference at which he launched his paper, said that there was an urgent need for causal research, will the Minister ensure that the Medical Research Council understands that? Can he also do something about the atmosphere of denial which pervades the Ministry of Defence and the medical assessment programme (MAP) and possibly put it out to a totally independent group of physicians and consultants who understand what these men are suffering from and will provide both treatment and diagnosis?
Lord Gilbert: My Lords, I am sure that the Medical Research Council needs no instruction from me. It will, of course, have read the reports of the two studies in the Lancet. As far as concerns the Ministry of Defence, we totally accept that as a result of the conclusions of the studies, we need to do a lot more work. For the benefit of those of your Lordships who may not have seen the recent articles in the Lancet, I shall read very briefly one of the interpretations:
"Although results from complex modelling procedures need to be interpreted with caution, our findings do not support a unique Gulf War Syndrome. The mechanisms behind increased self-reporting of symptoms need further investigation".
As far as the MAP is concerned, I am glad to be able to tell your Lordships that the waiting list for that programme, which was around 450 in the spring of 1997, is now down to 40.
Lord Clement-Jones: My Lords, having mentioned the further research to be carried out, can the Minister say whether independent scientists and doctors (in whom there is more confidence because of that independence), will be asked to undertake such research? That has consistently caused concern. Will the Ministry of Defence consider that?
Lord Gilbert: My Lords, I think that perhaps the noble Lord is not fully informed in these matters. The Ministry of Defence is already funding five studies outside the MoD; namely, at Manchester University, Professor Cherry's study into epidemiological matters; a study by Dr. Doyle at the London School of Hygiene and Tropical Medicine; a study by Drs. Sharief and Rose at King's College Medical School into neuromuscular matters. We are also funding a literature review at the University of Wales by
1134
Professor Lewis and there is work being done at Potion Down. I really do not believe that the Ministry of Defence can be accused of not consulting the most eminent people in these matters.
The Countess of Mar: My Lords, the Minister quoted from Professor Wessely's results. However, he did not say that Professor Wessely found that Gulf veterans were between two and three times more likely to be suffering from illness than veterans of Bosnia or Northern Ireland. He also stated that there was a possible connection between the administration of nerve agent pretreatment tablets and the anthrax vaccine. I have always maintained that there is no such thing as "Gulf War syndrome"; but there are Gulf War illnesses because of the variations in the mens' illnesses. That is precisely why we need causal research. If we do not know what is happening, we will not find the answers.
Lord Gilbert: My Lords, I would not disagree with a word that the noble Countess has said. I shall refer to the actual words in the author's interpretation of the other Lancet articles, and I shall abbreviate so as not to impose on your Lordships' time:
"associations of ill health with adverse effects and exposures were found in all cohorts, however, they may not be unique and causally implicated in Gulf-War-related illness".
Lord Burnham: My Lords, when the research is undertaken, will it include an examination of the geographical location of the people suffering from these illnesses? It looks strongly as if a very high proportion come from the north-east of the country.
Lord Gilbert: My Lords, we have been looking more at the geographical distribution of people in the Gulf rather than where they come from in this country. However, I shall certainly bear in mind the noble Lord's suggestion. I have no idea whether it has any medical validity, but I shall put it to our people.
The Earl of Effingham: My Lords, Professor Wessely's report certainly confirmed the view of the Royal British Legion that those who were deployed in the Gulf are more unwell than their colleagues who were not so deployed. Is it not a fact that 400 people have died since the Gulf War, and that one has already committed suicide? Can the Minister give us his view as to what happened at a recent inquiry into the verdict regarding a craftsman, John Callaghan, who committed suicide? At that inquiry there was a representative from the Ministry of Defence who actually did not answer the questions posed. Can the noble Lord say why an open verdict was given and why the evidence of that witness was not reviewed?
Lord Gilbert: My Lords, it is not in my hands to say why a particular verdict is given in any court proceedings in this country. I imagine that the noble Earl is referring to remarks made by Colonel Bosanquet, who was not then a representative of the Ministry of Defence; he was giving his own personal views.

EU/US Banana Dispute
3.30 p.m.
Lord Clinton-Davis Lord Clinton-Davis asked Her Majesty's Government:
What action they and other member states of the European Union propose to take to confront the threat made by the United States to impose sanctions on 520 million dollars-worth of European Union exports as from 1st February in consequence of the breakdown of negotiations between the European Union and the United States.
The Minister of State, Department of Trade and Industry (Lord Simon of Highbury): My Lords, I should like to give assurance to the House that the United Kingdom, along with other member states of the European Union and acting through the European Commission, is doing everything it can to seek a solution to the dispute about bananas through the World Trade Organisation. Negotiations are now under way between the European Commission, acting for the European Union, the United States and the WTO's director-general Ruggiero. We are likely to know more about the outcome of these negotiations during the course of today. However, I want to make it clear that we must do all we can to resolve this dispute through the WTO and avoid the imposition of retaliation. We want to see all sides engaged fully and urgently in the panel process to determine whether or not the EU's banana regime is consistent with WTO rules.
Lord Clinton-Davis: My Lords, I thank my noble friend the Minister for that intellectually respectable reply. Is it not absolutely "bananas" that, at the time of a severe downturn in world trade, the United States is seemingly resolved to start a trade war over the revised European Union banana regime by applying arbitrarily selected, unilateral and punitive sanctions, 23 per cent. of which would hit the United Kingdom? Is it not very clear that the line taken by the EU and by our Government is the right one? Can my noble friend the Minister tell the House what steps the Government and the EU are proposing in relation to retaliation if in fact the negotiations do break down while abiding by the due process of the WTO?
Lord Simon of Highbury: My Lords, I agree with my noble friend that it does not appear quite appropriate that this dispute has been raised to the level of intensity that it has. However, I am absolutely sure that our negotiators are currently seeking to achieve the following objectives: first, that no retaliation should come into effect unless the panel rules that the EU regime is not consistent with WTO rules; and, secondly, to press the EU and the US to implement the WTO panel outcome, when it is known, without delay. We understand the concerns of our Caribbean partners in the matter. We know that both the UK and the EU have very longstanding political and legal obligations.
Lord Steel of Aikwood: My Lords, notwithstanding the very proper negotiations in which the Government
1136
are engaged with the EU and the WTO, will they make it clear to our allies in the United States that this form of economic bullying is wholly unacceptable and that one of the threats would have a devastating effect on the Scottish cashmere industry if it were carried out? As that industry is located in the Scottish Borders, which have suffered a series of hammer blows recently, will the Minister have discussions with his noble friend Lord Macdonald of Tradeston, who has visited the area, and express his vehemence and knowledge to the US Government on this quite absurd and improper threat?
Lord Simon of Highbury: Yes, my Lords. I quite understand the impact of the threat of retaliation; indeed, even before it is there, it is bad for industry. I totally recognise that fact. Such uncertainty is unacceptable. However, I can confirm that, through my noble friend in the Foreign Office, the trade departments and, indeed, at the highest levels of government in this country, we have stressed extreme urgency in our consultations with our colleagues in the United States about the severity of our reaction to the problem.
Lord Peston: My Lords, following the intervention of the noble Lord, Lord Steel, does my noble friend the Minister recall that noble Lords have made it clear that this House in particular dislikes being threatened by our very good friends in the United States? Can my noble friend throw any light on the article which appeared in the Financial Times either yesterday or the day before which stated that our colleagues in Italy are already advocating that we make concessions on the matter before the battle has even begun? Can we be reassured that our Government and the EU generally will show complete backbone in the matter and simply not stand for any of this?
Lord Simon of Highbury: My Lords, I cannot assure my noble friend of the individual position of any of our partners as portrayed in newspaper reports. However. I am certain that the process of negotiation to resolve what is an acute problem—even though it is a very small and slippery subject—is being taken extremely seriously. The EU negotiators know full well the nature of our position, but, in order to resolve such a dispute, we must be able to negotiate.
Baroness Young: My Lords, does the Minister recognise that we all agree that a trade war would be an absolute disaster for the world as a whole? Indeed, it would have a terrible impact on some Caribbean islands, with disastrous effects on their populations. If the banana trade collapses, is there not also the prospect of that vacuum being filled by drugs? Can the Minister assure the House that this point is being made most vigorously to the American Government who would be sufferers of the effects of this policy, just as much as we in Europe would be?
Lord Simon of Highbury: My Lords, again, I can only confirm to the noble Baroness that we take the matter extremely seriously. We have gone through all

1137
the accepted channels in government to make our position, as the UK, clear. Noble Lords should be in no doubt that that is also extremely clear to the European Union negotiators who, naturally, have to negotiate on behalf of all the EU signatories to the agreement.

Health Bill [H.L.]
3.37 p.m.
Baroness Hayman: My Lords, I beg to introduce a Bill to amend the law about the National Health Service; make provision in relation to arrangements and payments between health service bodies and local authorities with respect to health and health-related functions; confer power to regulate any professions concerned (wholly or partly) with the physical or mental health of individuals; and for connected purposes. I beg to move that the Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Baroness Hayman.)
On Question, Bill read a first time, and to be printed.

Access to Justice Bill [H.L.]
3.38 p.m.
The Lord Chancellor (Lord Irvine of Lairg): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(The Lord Chancellor.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 31 [Rights of audience: employed advocates]:
Lord Archer of Sandwell Lord Archer of Sandwell moved Amendment No. 237:
Page 19, line 7, at end insert ("as regards his acting as an advocate on behalf of—

(a) his employer, or

(b) where his employer's only or main activity is providing legal services to the public, a client of his employer").

The noble and learned Lord said: In moving this amendment I shall, for the convenience of the Committee, speak also to Amendments Nos. 237A and 239A. Clause 31 deals with rights of employment for employed advocates. Subsection (1) exempts employed advocates from certain professional rules of conduct. For this purpose a person is an employed advocate if he
1138
is employed by the Crown in any capacity which involves his appearing before courts or,
"he is otherwise employed in such a capacity",
that is, otherwise than by the Crown.
That wording is very wide. In terms it would mean that if he is in employment in that capacity he may represent anyone, however unconnected with his employers. Presumably that is not the intention. My noble and learned friend may be pleased to hear that this amendment is intended purely to be helpful. The purpose of the amendment is simply to limit the exemption to what everyone believes was always intended. What is proposed is that the measure should be limited to situations in which the advocate represents his employer or, if his employer is in business to assist or represent clients, represents one of his employer's clients. It is a short point. I beg to move.
Lord Goodhart: New section 31A(1) of the Courts and Legal Services Act seems to give rights of audience to any qualified person employed as an advocate without any restriction on whom he can provide those services for. If that is the intention, we believe that it goes too far. Leaving aside the vexed question of employees of the Crown Prosecution Service, we accept that employees should have a right to appear as advocates on behalf of their employers. A qualified advocate employed by a bank should be entitled to act as an advocate on behalf of the bank in litigation to which the bank is a party. However, we do not believe that the bank should be able to offer the advocacy services of its employees to its customers for their litigation. Legal services are not services such as insurance to be marketed by a conglomerate. Efficient, honest and incorruptible legal services are of central importance in democratic societies, as indeed is recognised by Clause 36 of this Bill. Solicitors may, of course, employ someone with advocacy qualifications to provide advocacy for their clients. However, we believe that advocacy services should not be provided as a by-product of some completely different kind of service.
Lord Borrie: This amendment in effect forbids an employed lawyer from acting as an advocate for a client of his employer unless the employer's sole or main activity is providing legal services. In coming to a view on this matter I have been aided by the information given to me by the Bar Association for Commerce, Finance and Industry—a body of which I am not a member, but I, and no doubt other Members of the Committee, have received information from it—which has a membership of about 1,200 barristers who work in industry. It is a respectable body, as is indicated by the fact that its president is the noble and learned Lord, Lord Slynn of Hadley, and one of its vice-presidents is the noble Lord, Lord Alexander of Weedon.
Earlier this month the association sent me a letter in which it points out that the barristers who belong to the association—I shall call them in-house barristers for short—have long suffered from the restrictive rules of the Bar Council which prevent them from exercising rights of audience in the higher courts at all. The Bar Association is represented on the General Council of the

1139
Bar, but it feels that it is not really represented by that body in, for example, such discussions and debates as we are having today. The in-house lawyers were considerably gratified to note Clauses 31 to 37 of this Bill. In their view the value to industry of those measures will be significant as companies will be able to use their own in-house lawyers for litigation in so far as they choose to do so. They may choose to use an in-house barrister for interlocutory proceedings but not for main proceedings. Or, they made choose to have an in-house lawyer, acting as a junior independent barrister, as Queen's Counsel in the proceedings. But they would have the choice.
Naturally, many firms which employ barristers in-house are concerned to keep down the costs of litigation. They wish to provide legal services to their clients, as well as any services they need for themselves, in a way which suits them best. They want to have that freedom of choice. The Bar Association has provided a number of case studies to illustrate the situation. That is most useful in my view. I have selected just one of them to mention this afternoon. It concerns a company which provides consultancy services in the construction industry. As one would expect, it engages quantity surveyors, engineers, architects and lawyers. Many of its lawyers have dual professional qualifications which firms find of great value. For example, someone may be qualified both in law and one of the engineering professions.
The firm to which I refer, James R Knowles Plc, has 18 barristers on its staff. According to the Bar Council rules, they are technically non-practising barristers because they provide legal services to their employer's clients. At present they are not allowed to act as advocates in court for any of their employer's clients. In other words, at the present time they cannot provide a comprehensive, one-stop service to their clients. They can assist with arbitration and with mediation. However, the land which is marked "keep off" is the land of litigation.
The Committee will appreciate that clients of this consultancy firm may have had a long and established relationship with the firm. As and when a matter may unfortunately give rise to litigation, they do not wish to go outside, as it were, to seek a barrister to represent them in court. After all, this is a specialist area of law. If a barrister is employed by this consultancy firm who has perhaps dual qualifications, he may be—I say only may be—the best choice for the client in terms of advocating his cause in the courts.
Many Members of the Committee, and those who propose this amendment, may be concerned—as was the case when we discussed criminal cases earlier in the Committee stage—about the integrity and the independence of barristers. It is argued that unless they are part of the independent barristers' profession, they may be less independent and show less integrity in some way. Of course the Committee is aware, although we have not yet discussed it in any detail, that Clause 36, which we shall reach shortly, stipulates that any advocate has an overriding obligation to the courts rather than to anyone else.
1140
In my submission this amendment would damage the growing legitimate business of consultancy firms—of the kind I have mentioned—of firms of accountants and of well-known and respected insurance companies. The amendment would prevent them providing a service to the client which includes legal services and which includes occasionally, unfortunately, the need to go to litigation. To deprive those companies of being able to provide one of their in-house lawyers as an advocate in court would be to restrict them at such time as one or more, or in the case of insurance companies many, of their clients might need legal assistance in the courts. The rights of subrogation would be involved in such a case. Yet the in-house lawyer, who these days is often very skilled and has possibly been an independent practitioner in the past, would be prevented from assisting in a client's pursuit of his case through the courts. The Bill, unamended, would provide for the development of that service without in any way impairing or impeding the position of the independent Bar, whose members will, as always, be available if that is a client's choice.
Lord Archer of Sandwell: I am grateful to my noble friend for giving way. Does he agree that, as presently drafted, the Bill would permit the employed lawyer to represent anyone who simply came to him or her with any kind of case, totally unrelated to the business of the employer?
Lord Borrie: It may be that the wording of the clause is broader than is desirable. What I am concerned to establish is that it is ultimately very desirable that in-house lawyers should be enabled to provide services for clients—I gave the example of established clients—of the kind of firms I have mentioned. I imagine that it would be very difficult to create some rigid distinction as to, for example, whether a person had been a client for a month, a year or whatever before that was allowed to happen.
The Lord Chancellor: My noble and learned friend Lord Archer seeks to clarify the scope of Clause 31. He describes his point as a short one; however, it is important and has wide ramifications, as the noble Lord, Lord Borrie, demonstrated.
Amendments Nos. 237A and 239A standing in my name are intended to achieve the same purpose of clarifying the scope of Clause 31. Therefore, perhaps the Committee will forgive me if, at the outset of our deliberations, I take what I regard as a useful opportunity to set out the whole of the Government's thinking on these issues. Perhaps I may deal first with the specific amendments.
Clause 31 is designed to abolish, once and for all, the disgraceful restrictive practices which have prevented Crown Prosecutors and other employed lawyers from appearing in the higher courts, regardless of their qualifications.
Clause 30 grants all barristers and solicitors rights of audience, which may, however, only be exercised in accordance with the qualification regulations and rules of conduct of the authorised body concerned. It will

1141
remain for the Bar Council and the Law Society to regulate the rights of audience of their members. But the Government do not intend that, in regulating their members, they should be able to discriminate against employed barristers and solicitors as they currently do.
Amendment No. 237A replaces the word "circumstances" in subsection (2)(a) with the word "capacity". That subsection provides that employed advocates are not bound by professional rules which limit the courts before which, or proceedings or circumstances in which, a right of audience may be exercised by an employed advocate; this is subject to the proviso in subsection (2)(b) that such rules do not apply, only if the same limitation is not imposed on other members of the body.
My intention is that an employed lawyer should be able to exercise rights of audience in the higher courts if he is otherwise qualified to do so. His employed status should not in itself constitute a barrier. But I think the word "circumstances" may go too far. I do not intend to prevent the professional bodies from making rules governing the exercise of rights of audience which provide differently for the different circumstances of advocates in private practice and employed advocates.
In particular, and here I begin to touch on the issues raised by my noble and learned friend's amendment, I do not wish to prevent the professional bodies from requiring that the generality of employed advocates should not provide their services to the public at large, but should appear in court only on behalf of their employers.
There are, of course, arguments, some of which we have heard from the noble Lord, Lord Borrie, in favour of allowing commercial companies such as insurance companies or management consultants to provide advocacy services to their clients. However, I am not persuaded by those arguments. With the leave of the Committee, I shall explain the Government's position in greater detail in a moment.
So what I propose in Amendment No. 237A is to replace the word "circumstances" with the word "capacity". This is narrower, but will still ensure, for example, that professional rules cannot prevent employed advocates from appearing as the sole or leading advocate in a substantive case. I think that this narrowing achieves what my noble and learned friend Lord Archer intends by his amendment, which is to preserve those professional rules which prevent employed advocates, other than those who are employed in lawyers' offices, from offering their services to the public.
The amendment that I have proposed leaves one problem unresolved, which is the position of those advocates who are employed by lawyers of another category. Solicitors employed by firms of solicitors are treated by the Law Society's rules as solicitors in private practice. They may therefore offer their services to the public and, if they have the necessary qualifications, may exercise full rights of audience.
1142
In contrast, barristers employed in solicitors' offices, are deemed, by a fiction of the Bar Rules, to be non-practising banisters. They may offer limited legal services to members of the public but have no rights of audience of any kind under the Bar's rules, no matter how well qualified they are, and no matter how many years they may have spent as barristers in private practice.
The Government regard that as a restrictive practice which cannot be tolerated. A barrister who would have full rights of audience if he were in private practice should have full rights of audience if he works for a solicitor, and should be able to offer his services as an advocate to members of the public in the same way as solicitor advocate employed in the same firm.
My intention is, therefore, that lawyers who are employed by other lawyers, such as barristers working in solicitors' offices, should be able to offer advocacy services to members of the public. But I am not confident that Clause 31 achieves that end at present. I shall therefore bring forward an amendment at Report stage in order to make that explicit. On the basis of what I have said, I hope that my noble and learned friend will agree to withdraw his amendment.
The last amendment in this group, Amendment No. 239A, is designed simply to clarify the drafting of Clause 31 without affecting its substance. As I have already explained, the purpose of Clause 31 is to abolish, once and for all, the restrictive practices which have prevented Crown prosecutors and other employed lawyers from appearing in the higher courts, regardless of their qualifications. It does this by inserting into the Courts and Legal Services Act 1990 a new Section 31A, which provides that someone who has been granted a right of audience by an authorised body and is "employed as an advocate" is not bound by certain restrictions which might otherwise prevent him from exercising his rights of audience.
Subsection (3) of the new Section 31A defines when a lawyer with rights of audience is "employed as an advocate". It covers in subsection (3)(a) Crown prosecutors and others in Crown employment and in subsection (3)(b) advocates employed outside government. The existing wording of subsection (3)(b) refers to those who,
"are otherwise employed in such a capacity",
which seems to me to be potentially confusing, as it is not immediately clear whether it refers to those who are employed by the Crown or those who are employed in a capacity which involves appearing before the courts. The latter is the correct interpretation, it is the invention and I hope that the amendment makes that clear.
The effect of the amendment will be that the two categories of employed advocate are: first, Crown prosecutors; and secondly, other lawyers with rights of audience who are employed in a capacity which involves appearing before the courts. The separate reference to other Crown employment will go, and other government lawyers will be covered by the second category. The definition of "Crown employment" in subsection (4) will be rendered unnecessary and will also disappear. The noble and learned Lord, Lord Simon

1143
of Glaisdale, is not in his place this afternoon, but I hope that this reduction in unnecessary verbiage would have appealed to him, had he been present.
I commend the amendments standing in my name, Amendments Nos. 237A and 239A. I have explained the amendments but it may be of assistance to the Committee at the outset of our deliberations to be in no doubt as to the state of affairs that the Government intend to bring about as a result of the changes in the law.
I summarise the matter as clearly as I can in relation to each category of lawyer. The intention of the Bill is that solicitors and barristers should, if they wish, be able to acquire and exercise full rights of audience in accordance with the rules of their profession, without any discrimination for or against either category.
The way this is to be achieved is that they will be granted full rights of audience in principle on call to the Bar or admission to the roll of solicitors. But whether they may exercise them, and the circumstances in which they may exercise them, will be governed by the training requirements and rules of conduct of each professional body, subject to the restrictions on those rules which are contained in the Bill.
A solicitor or barrister who has qualified to exercise full rights of audience will retain those rights if he moves from one branch of the profession to the other. He will also retain them if he joins the Crown Prosecution Service, or enters other Crown employment as a government lawyer, or is employed as a lawyer by local government or by the legal services commission. A barrister or solicitor who joins the public service without having previously acquired the ability to exercise full rights of audience—for example, a barrister who has not been able to find pupillage—should be capable of acquiring those rights as an employed lawyer. I look to the professional bodies to find sensible ways of achieving this, but the Bill does not deal with that point directly.
Now I turn to barristers or solicitors in other employment. Obviously a solicitor employed by a firm of solicitors is capable of acquiring full rights of audience already. A barrister employed by such a firm, however, is not able to exercise any rights of audience on behalf of its clients, even if upon joining the firm he is a barrister with many years' experience as an advocate in the higher courts with full rights of audience. He can only acquire rights of audience afresh as a solicitor. This is an obvious restrictive practice inhibiting flexibility and movement within the profession. I am not satisfied that the Bill currently deals with this problem effectively, and I shall therefore be seeking to bring forward a suitable amendment on Report.
I next turn to solicitors or barristers who are employed as lawyers in industry or commerce or with other employers. That was the focus of the attention of the noble Lord, Lord Borrie. If they have met the qualification requirements which apply to other members of their profession, then they too should be able to exercise full rights of audience in the courts on behalf of their employers. I believe that the rightness of
1144
that was accepted by the noble Lord, Lord Goodhart. This will be made possible as a consequence of the new Section 31A in the 1991 Act, inserted as a result of Clause 31 of the Bill. The new Section 31A outlaws discrimination on the grounds of employee status.
I next address the issue to which the speech of the noble Lord, Lord Borrie, was directed. I have considered the further and important question of whether fully qualified barristers and solicitors employed as advocates in commerce or industry or in other private sector employment should also be able to offer their advocacy services to the public or to the clients of their employers, as distinct from their employers themselves. Arguably the words "or circumstances" in the new Section 31A(2)(a) would outlaw the rules which currently prevent that, since they impose a limitation on those for whom employed advocates may act which does not apply to advocates in private practice.
There are arguments—and the noble Lord, Lord Borrie, canvassed them—for enabling an advocate employed by an insurance company, for example, to represent in court a party whose potential liability is covered by a policy with the company. Other private companies such as management consultants or banks might also like the opportunity to offer advocacy services to their customers when required.
While I do not rule out that option for the future—I cannot do so since it is always open to the professional bodies to propose changes to their rules—I do not think it would be appropriate for the Bill to strike down the regulations which currently prevent those developments. Advocacy services need to be properly regulated by the professional bodies, especially when they are being offered to the public at large. I do not wish to open up a gap in regulation which might enable an insurance company, bank or supermarket for that matter—or, indeed, what might be called a Virgin law shop—to provide professional legal services to the public, without having to comply with the regulations which govern firms of solicitors or barristers in Chambers or with equivalent regulations to protect the public.
The Government, therefore, do not intend that the Bill should abolish the rules which prevent the provision of advocacy services to the public or to clients by commercial organisations other than firms of lawyers. That will remain a matter for regulation by the professional bodies.
I apologise to the Committee for taking so much time at the outset, but I thought that it would be of assistance if the whole position from the Government's standpoint were made clear at this early stage in our discussions this afternoon. I beg to move.
Lord Woolf: I am grateful for that clear and helpful description of the general position of the Government on the series of clauses to the Bill and the proposed amendments. I, like many noble Lords present, found what the noble and learned Lord said very reassuring.
However, let me draw attention to a matter which is of concern not only to myself but to many of my judicial colleagues. At Second Reading, I made it clear that I did not in general oppose the extensions of rights of

1145
audience. In common with the Lord Chief Justice, I drew attention to the deeply felt concerns to which I have already referred. Those concerns were as to the possible adverse consequences on the administration of justice which could result from the extension. Central to those concerns was a fear that the standards of advocacy and representation in courts and tribunals would deteriorate. To avoid this happening, I suggest that it is essential that there should be in place, for all who have rights of audience, a common code of conduct as to how those rights are exercised, and a common disciplinary body to enforce that code.
In saying that, I should emphasise that I am not suggesting that the common code should interfere with the rights of each professional body to regulate its members in general terms. I am concerned about the quality of the services provided in the courts and tribunals to which I have referred as a result of those rights of audience.
The Bar has already in place the type of code and disciplinary body which I would like to see commonly applied to the Bar, solicitors and legal executives. I believe that, with encouragement, there should be no difficulty in reaching agreement on a common code dealing with advocacy practice, and a common disciplinary body to enforce it.
As noble Lords will know, as Master of the Rolls I have a special relationship with the solicitor side of the profession. I am also a vice-president of the Institute of Legal Executives. I shall certainly urge those two bodies to co-operate in what I have suggested should exist. I have no reason to think that the Bar would have any problem with what is being proposed.
However, if an agreement cannot be reached, I suggest that this would be an example of a situation where the Lord Chancellor, subject to suitable consultation and safeguards, should be able to use the powers that this Bill gives him to take appropriate action. This would not involve any infringement of the independence of the three professional bodies to which I have referred. It would avoid a wholly undesirable lack of consistency in standards in relation to the rights of audience, which I apprehend will concern noble Lords. Whether it is an employed or independent barrister, solicitor or legal executive who is acting as advocate, the same standards of conduct must be observed.
The views I have just put forward were expressed forcefully by the Council of the Inns of Court in its paper in response to the consultation paper on rights of advocacy. They are supported by the Lord Chief Justice and by the Judges Council, which considered the issue last night.
Will the noble and learned Lord, the Lord Chancellor confirm, first, that he agrees that all those who practise as advocates before courts or tribunals should be subject to a common code of conduct relating to the role of the advocate while they are acting in that capacity, and that there should be a single disciplinary body, and, secondly, that if the authorised bodies fail to reach agreement, the Lord Chancellor will have under the Bill sufficient powers to ensure that a common code and a disciplinary tribunal are established?
1146
I see no objection to extending rights of audience as long as consistent standards—as high as at present—are observed. The maintenance of those standards depends on a suitable disciplinary procedure being in existence in which the judiciary must have the final word. I can see every objection to a series of different bodies having rights of audience, each with its own standards and own means of enforcement. If we are not to have those safeguards, the case that could be made by those noble Lords who are not in favour of the proposals in this part of the Bill would be that much stronger. The ability to enforce standards is the foundation on which the case for extending rights depends. If those rights are to be enforced, they must be enforced consistently. I would suggest that that can only be done by having a common disciplinary tribunal.
4.15 p.m.
Lord Ackner: Before the noble and learned Lord sits down, can he tell us what "standards" comprise? Do they comprise competence?
Lord Woolf: The standards to which I specifically refer are standards in the face of the court or tribunal. Those will be dependent upon competence but, as I see it, the question of competence is one which can be safely left in the hands of the individual professions. Different considerations apply to standards in the conduct of the litigation before the court or tribunal.
Lord Clinton-Davis: I support what the noble and learned Lord the Master of the Rolls has said in a very interesting development in the debate. I sincerely hope, as a practising solicitor—but no longer a solicitor advocate, except maybe here—that the Law Society and Institute of Legal Executives will have no difficulty in accepting the principle of the argument. It would be interesting to see whether my noble and learned friend had to bang heads together on this. I would hope not, but as a last recourse that may be necessary.
Can I ask my noble and learned friend whether the current regulations deal with this situation? If an advocate is employed by company A, could he act for a subsidiary of that company and vice versa? I do not know the answer—it may be irrelevant—but it occurs to me that a difficulty might arise in that respect.
Lord Hacking: The noble and learned Lord the Lord Chancellor need not have apologised at all to the Committee for giving such clear guidance on how he sees the rights of audience progressing forward in relation to employed advocates. I am very grateful to the noble and learned Lord for that careful and forward thinking statement. It is to be welcomed that rights of audience should be extended to employed advocates, not only to those who appear in the Crown Courts but to other very well qualified lawyers in administrative bodies such as the financial services. There are some very highly qualified lawyers in the Financial Services Authority.
I also welcome the noble Lord's approach to barristers who find themselves in solicitors' employment, which is my side of the profession.

1147
Competition for the Bar is very stiff and many a bright and able young lawyer is unable to find a tenancy. We on our side of the profession are more than willing to welcome to our ranks bright and able young lawyers who have been unable to find a tenancy. For them, having become highly qualified and gone through pupillage, possibly extended pupillage, before eventually failing to find a tenancy, clearly it is wrong that they should lose their rights of audience on coming to our side of the profession. I therefore very much welcome the observations of the noble and learned Lord.
I have some concern, however, about the third matter which the noble and learned Lord explained at length: the position of employed lawyers outside such bodies as the Crown Prosecution Service, regulatory authorities and so forth; in other words, those in consultancy agencies, accountancy firms and the like. While the noble and learned Lord does not close the door in future, the difficulty lies in seeing how those lawyers can obtain rights of audience. They will certainly not get them under the umbrella of established authorised bodies. One has only to look at the history of the long debates on employed advocates and debates in the Bar Council to know of the intense opposition that is likely to arise over those lawyers being given rights of audience. I am aware of the management consultancy cited by my noble and learned friend Lord Borrie. I have seen its lawyers appearing in arbitrations where they have full rights of audience. The competence and professional ability of the lawyers in that organisation is of the highest order. The difficulty is that the authorised bodies will oppose such lawyers being given rights of audience, and their only route will be to establish themselves as an authorised body and go through that very extensive procedure before they are given rights of audience.
There is no valid argument in principle why a lawyer employed by a management consultancy should be any less able and fitted to the role of the advocate than other employed lawyers and those employed in private practice. As to that, I wholly endorse the words of the noble and learned Lord the Master of the Rolls about the need for a common code of conduct relating to the exercise of rights of audience and a common disciplinary body. That can also be incorporated into the point that I make. I ask the noble and learned Lord to give further thought to this issue. Provided every lawyer who has a right of audience is subject to a proper code of conduct and a common disciplinary body the public is properly protected and there is no injustice to the public. If there is no injustice to the public and the lawyer is in those circumstances prevented from practising his skills as an advocate it is a restrictive practice which everywhere else in the Bill my noble and learned friend is opposing.
Lord Hutchinson of Lullington: Perhaps I may put a very simple question to the noble and learned Lord the Master of the Rolls on the proposition that there should be a common code. For the independent criminal barrister the basic rule is that he is available under what is called the cab-rank rule to any person who requires his services, however unpleasant or unattractive the case
1148
may be, which means that the advocate must accept that brief before any other. How can that provision apply to the employed prosecuting advocate under a code?
Lord Woolf: In the code to which I referred I tried to draw a distinction between standards before the court and the restrictions to which the individual would be subject as to his client. The code to which I referred would not deal with the subject to which the noble Lord refers.
Lord Donaldson of Lymington: I welcome the suggestion of the noble and learned Lord the Master of the Rolls that there should be a common code. It is perfectly possible to incorporate into the code the key features that apply to the Bar and may not at the moment apply to solicitor advocates. But there is a very strong case for having a common code. A common disciplinary tribunal is an attractive idea but needs to be looked at a little closely for a number of reasons.
At the moment there is a right of appeal from the Bar's Disciplinary Tribunal to the Visitors who are members of the judiciary. There is a right of appeal (the technical basis for which I have now forgotten) from the Solicitors Disciplinary Tribunal to the courts either under the Solicitors Act or by way of judicial review, but it matters not which. Those are different. They would have to be radically altered by statute before one could have the kind of common tribunal suggested by the noble and learned Lord. There is no doubt that it could be done. I doubt whether it could be done under the powers in this Bill. I also doubt whether it could be done by amendment of this Bill. I do not believe that there has been sufficient time in which to consider the matter in detail.
Perhaps I may deal with one or two other matters. I probably misheard the noble and learned Lord the Lord Chancellor when I thought he said that a member of the Bar, who by definition has full rights of audience from the moment of legal birth, might have difficulty in getting a pupillage and would then be able to transfer to the solicitors' branch where he could not get a pupillage. I do not believe that he could do that. It would not solve the problem because the same rule about requiring pupillage before exercising rights of advocacy would apply to all members of the Bar. Therefore, it would not fall within this exception. However, I may have misheard the noble and learned Lord. If he said "tenancy" that would be a different matter because that would be correct.
On Tuesday of this week, in the debate on employed lawyers, the noble and learned Lord said:
"Some Members of the Committee may be tempted by the argument that someone who is paid a salary by the state cannot be truly independent. All that is needed to refute that argument is to look at the position of the judges whose independence is not questioned. The senior professional judiciary are full-time salaried servants of the Crown".—[Official Report, 26/1/99; col. 1006.]
They are not; they are office-holders, which is substantially different. Furthermore, they are virtually irremovable. Above all, on becoming judges they join a college, as it were, with a very long established view of the importance of independence not only as a body but

1149
individually. No judge, however distinguished, can give any instructions whatever to any other judge. One is considering here personal independence.
Some years ago when I was concerned with industrial relations I recall a very distinguished Member of this House who at that time was a Secretary of State, saying to me, "To whom are you responsible as President?" I understood him to be referring to the National Industrial Relations Court. He said, "I take it that you are responsible to the Lord Chief Justice". I said, "Certainly not". He said, "Then, to the Lord Chancellor". I said, "Certainly not. I am responsible solely to my conscience and to the law." That is a cultural independence that does not exist elsewhere and no parallels can be drawn with it.
4.30 p.m.
Lord Wigoder: We seem to have moved away from the issue of principle about employed barristers to issues of standards. Issues of standards are of the greatest importance. I was proposing to make one or two comments about that in the debate on whether the Clause shall stand part, but as the question has been raised perhaps I shall be forgiven for dealing with it now.
A code of conduct, yes; a disciplinary body, yes: those matters are comparatively easy to establish. The real problem is the practical one of ensuring that breaches of the code of conduct are discovered, brought to the attention of the disciplinary body and dealt with. I have in mind the fact that at the Bar such matters are dealt with not only by the Bar Council's disciplinary bodies or by the Inns of Court disciplinary bodies, but also in an informal and effective way. Any member of the Bar who prosecutes and then breaches what might be thought to be in a code of conduct—if there were a formal code—will find, the Bar being a comparatively small profession, that his deficiencies are immediately observed by his colleagues. The matter will be brought immediately to the attention of the head of chambers, who will take action, or it will be brought to the attention of the leader of the circuit, who will take action. It is also not unknown for a wise judge to send for a young man after a case and politely and firmly explain the position.
Therefore, in due course, breaches of a code of conduct can come to the attention, if necessary, of a disciplinary body. I hope that the noble and learned Lord will be able to indicate, in some little detail, not only the nature of the code and the nature of the disciplinary body, but also the machinery for its operation.
I understand that pilot schemes are under consideration. Would the noble and learned Lord say a word about the extent of the proposal in relation to pilot schemes and how they will operate? I venture to assume that when the noble and learned Lord examines the results of the pilot schemes he will want to look not only at the forensic ability of those who have been granted new rights of audience, but also, to use a rather pompous expression, the ethical ability of those granted new rights of audience. I suspect that if and when he does
1150
that, he will find that he has to hasten rather slowly and not extend rights of audience too rapidly and too extensively.
I am sure that the noble and learned Lord will agree that it is absolutely imperative that, before doing that, he should be totally satisfied that the ethical rules of conduct of the legal profession, particularly when carrying out prosecutions, are observed by newcomers to the profession.
Lord Campbell of Alloway: The noble and learned Lord the Lord Chancellor will remember that I mentioned the problem of the machinery of quality control in reference to a previous amendment. The noble and learned Lord said that either he would give consideration to that or he would deal with it subsequently in Committee. The noble Lord, Lord Wigoder, referred to the same point. Perhaps it would be convenient for the noble and learned Lord to deal with it in outline at this stage.
While I am on my feet, I most respectfully say that I wholly support everything said by the noble and learned Lord the Master of the Rolls.
The Lord Chancellor: I shall endeavour to pick up a few threads of the arguments raised in debate. Then I shall deal with the important proposal brought to your Lordships' attention for the first time today by the Master of the Rolls, the noble and learned Lord, Lord Woolf.
The noble Lord, Lord Clinton-Davis, asked a question about the ambit of the rules of the professional bodies. I suspect that it was a question that came into his head as he was listening to the discussion and he thought that it would be good to know the answer. I shall certainly not give the noble Lord an assurance about the ambit of professional rules without having them in front of me or indeed without consulting on how they are applied in practice. I would have thought that they might be applied in practice so that an advocate employed by a company may appear for his employer, the company, and other subsidiaries within the group. However, I think that calls for investigation by reference to the rules.
The noble Lord, Lord Hutchinson of Lullington, sought to tax the noble and learned Lord the Master of the Rolls with a question on whether the "cab rank" rule would not apply to the Crown Prosecution Service. The "cab rank" rule is one of the glories of the Bar. It underscores that every member of the Bar is obliged, without fear or favour, to represent clients who offer themselves, regardless of how unpopular they may be in the community or elsewhere. However, Crown prosecutors are employed by the Crown Prosecution Service, and therefore appear on behalf of their employer only; so the "cab rank" rule has no application.
I entirely take the point of the noble and learned Lord, Lord Donaldson of Lymington. High Court judges are office holders and can be removed only by address of both Houses of Parliament. That underpins their independence. The much larger number of Crown Court

1151
judges can, by statute, be removed by the Lord Chancellor for misconduct. However, I take the noble and learned Lord's point.
I now turn to the matter brought to the Committee's attention by the noble and learned Lord, Lord Woolf. Before responding, I express my gratitude to him for ensuring that notice was given to me earlier today of his intention to raise such questions. However, I do not regard myself as being in a position to make a fully considered response. Therefore, I shall not offer the detail that I imagine the noble Lord, Lord Wigoder, would prefer as my reaction to the proposal. For some reasons that I shall give. with respect, I suggest to the noble and learned Lord that the waters are slightly deeper than the apparent straightforwardness that his question suggests. In that regard, I identify with the cautionary note struck by the noble and learned Lord, Lord Donaldson of Lymington.
The Lord Chief Justice, the noble and learned Lord, Lord Bingham of Cornhill, suggested in our debate on Second Reading,
"that rights of audience should be exercised only by those who possess the required knowledge, skill and integrity, and"—
he added—
"who are subject to a common code of conduct and discipline".—[Official Report, 14/12/98; col. 1 1 26.]
Advocates are not subject to a common code of conduct and discipline at present. Solicitors, barristers and legal executives—as we must now add—the three kinds of authorised advocate that currently exist, all have their own rules of conduct and their own disciplinary procedures.
Solicitors, for example, have a special code for advocacy as part of their rules. The requirement of Section 17(3) of the Courts and Legal Services Act 1990, which will not be changed by the Bill as it presently stands. is that an advocate must belong to an authorised body which has rules of conduct which are appropriate in the interests of the proper and efficient administration of justice. But the authorised body must have an effective mechanism for enforcing those rules—a matter to which the noble Lord, Lord Wigoder, referred—and that it must be likely to enforce them. All three bodies which are authorised to grant rights of audience to their members meet those criteria today.
All advocates are also subject to a requirement imposed by Section 17(3) of the Courts and Legal Services Act that they may not withhold their services on the grounds that the case is objectionable (that harks back to the cab rank rule); that the conduct, opinions or belief of the client are unacceptable (which similarly harks back to the cab rank rule); or on any ground relating to the source of any proper financial support received by the client.
Any new authorised body will be subject to the same provisions. No new body could be authorised if it did not have satisfactory rules of conduct and disciplinary mechanisms. One of the purposes of the legal services consultative panel, the Director-General of Fair Trading, and the designated judges under the new approval
1152
procedure to be created by the Bill, will be to give advice on whether satisfactory rules and procedures are in place.
Therefore, as matters stand at present, if the authorised bodies wish to pool their experience and expertise and draw up a common code, that would be for them. While I would judge any code on its merits, my instinctive reaction is that there is much to be said for such a common code; and my instinct would be to give it my blessing, basically for the reasons advanced by the noble and learned Lord, Lord Woolf. However, there are potential problems. For example, barristers in private practice do not give members of the public direct access to their services; and, as the noble Lord, Lord Hutchinson of Lullington, emphasised, they operate the cab rank rule. Other advocates need not practise in that way.
I understand, although I have not looked into the matter in any detail, that the Bar Council and the Law Society at one time considered establishing a joint code of conduct for advocates. But the problems on which I have touched were thought of at that time to be insuperable. If I overstate that, I shall be corrected, but that is as I recall the position. There may be some who would suggest that in establishing a common disciplinary code there may be an implication to enforce a common code of conduct; that it was a step on the road towards the fusion of the legal profession. Obviously that does not begin to be necessarily so, but when some think that we move into deep waters.
At present the Bill does not give me any express powers, as I see it, to impose a common code or common disciplinary procedures on the professional bodies. My only powers will be to approve changes which the professions make in their rules; and, with—and only with—the approval of both Houses of Parliament, to alter any rules which unduly restrict rights of audience or rights to conduct litigation. I would not oppose proposals from the professional bodies to adopt a common code and disciplinary procedure if they wish but I should have thought that the initiative lay more with them than with me. However, I accept that the tenor of what came from the noble and learned Lord, Lord Woolf, was rather different. I believe that he went rather further, inviting me to consider acquiring powers to impose the outcome that he recommends in default of agreement among the professions. Again, I think that these are deep waters, but I should be happy to enter into discussions with him on the subject between now and Report.
4.45 p.m.
Lord Woolf: I thank the noble and learned Lord the Lord Chancellor for that helpful response to the points I made. Like the noble and learned Lord, I recognise that these are deep waters. I fear that the proposals for extension of rights of audience also involve putting a substantial part of one's body into deep waters. I suggest that it is another area where serious consideration has to

1153
be given to what could be an important consequence of extension of the rights of audience to the extent envisaged by the noble and learned Lord.
Lord Archer of Sandwell: I am grateful to all noble Lords who participated in the debate. It is a debate, if I may say so, which will well repay reading in detail tomorrow. I was only trying to be helpful. I thought that I was suggesting a simple answer to a simple drafting problem. One cannot be right all the time! I plead only in mitigation that I set down the amendment at the instigation of the Bar Council, which obviously shared that rather simplistic view at one stage.
Clearly there are genuine problems. We seem to be wholly in agreement that employed lawyers should be capable of being accorded rights of audience. Two questions then arise. First, how should they be subjected to the standards which are applied to other applicants'? It seems to be agreed that it should be left substantially to the rules of conduct of professional bodies. If I may say so respectfully, I wish the proposal of the noble and learned Lord the Master of the Rolls well. However, like my noble and learned friend the Lord Chancellor I remember when the professions were less attracted to such suggestions. It may be that we have travelled far even in the past five years and have learned something along the way. I hope that the learned and noble Lord has begun something which may gather momentum.
The second question which arises is whether, subject to those standards, it is agreed that an employed lawyer may appear to represent anyone, however unconnected with his employer, in proceedings however unconnected with his employer's business. Clearly there may be some inroads on the general principle as was indicated by my noble friend Lord Borrie. But I suspect that we shall need to reflect on that in somewhat greater tranquillity than is possible at present.
These questions are intellectually stimulating. They are also of great importance to the public. For the moment, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Lord Chancellor The Lord Chancellor moved Amendment No. 237A:
Page 19, line 11, leave out ("circumstances") and insert ("capacity").
On Question, amendment agreed to.
[Amendments Nos. 238 and 239 not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 239A:
Page 19, line 19, leave out from ("or") to end of line 26 and insert—
("(b) he is otherwise employed in a capacity which involves his appearing before courts.'"').
On Question, amendment agreed to.
Lord Kingsland Lord Kingsland moved Amendment No. 240:
Page 19, line 26, at end insert—
("(5) A person employed as an advocate in accordance with subsection (3) shall only be permitted to prosecute a case being tried on indictment which—

(a) falls within class 4 of the classification of the Business of the Crown Court and Allocation to Crown Court Centres Directions: and

(b) has been released by the Presiding Judge of a Circuit, in accordance with those Directions, for trial by a Circuit Judge, Recorder or Assistant Recorder."").

The noble Lord said: The purpose behind the amendment is to ensure that the more important criminal cases are prosecuted by independent advocates. The noble and learned Lord will recall that late in the third day of Committee a considerable amount of time was devoted to arguments against the granting of rights to CPS advocates in the Crown Court. I shall not rehearse those arguments again today.
The main reason for questioning the merits of the move were well explained in the speech of the noble Lord, Lord Thomas of Gresford. He emphasised, in particular, the danger of a conflict of interests between the duties of a member of the Crown Prosecution Service to his employer and his duties to the court. I entirely share the noble Lord's concerns and wish to raise only two other issues. They go to the original motives expressed by the noble and learned Lord last year when he first suggested the changes which are now contained in the Bill. Those motives were saving money and enhancing competition.
I wish to ask the noble and learned Lord, first, how he believes money will be saved by a shift from using independent advocates to prosecute to using advocates in the Crown Prosecution Service. It is well known that in many respects the cost burden of employing someone on a salary, with all the related overhead expenses, can be much higher than using someone who is self-employed.
The second issue relates to competition. During the past 20 years, it has been accepted in the United Kingdom and in many other countries that the best way to enhance competition is by a process of privatisation. But here we must assume that implied into the change is the claim that the best way to promote competition is by increasing nationalisation; because the greater the number of cases advocated in the Crown Courts by employees of the CPS the greater will be the degree of nationalisation. How will the noble and learned Lord ensure there is competition between the CPS advocate on the one hand and the independent practitioner on the other?
There is a great deal of case law in the courts of the European Community about competition between private and state entities. We all know to what extent states can subtlety undermine competition in the market by giving state aid of one form or another. Therefore, apart from the important point of principle, which was well expressed by the noble Lord, Lord Thomas of Gresford, I should like to hear the noble and learned

1155
Lord's views on the issues of saving costs and competition to the extent that he feels able to express them at this juncture. I beg to move.
Lord Thomas of Gresford: I do not propose to rehearse again the argument which I entered into in the early hours of Wednesday to a hard core of dedicated people. I shall reserve that for a later stage of the Bill. However, perhaps I may ask two questions arising from the amendment.
I referred on Wednesday morning to the current pilot schemes whereby members of the Crown Prosecution Service are prosecuting in the Crown Court. I know of it in the Mold Crown Court in my own area and wonder whether the powers given to them have gone any further than those suggested in paragraph (a) of the amendment and whether they have been under the control of the presiding judge of a circuit as suggested in paragraph (b). I repeat my request for information as to whether there has been any assessment of the success of the experiments which are being carried out with the CPS.
The Lord Chancellor: First, noble Lords should bear in mind that I am not responsible for the Crown Prosecution Service. The Attorney-General is the Minister responsible. Secondly, the noble Lord, Lord Kingsland, will look in vain in Hansard for any proposition from me that the justification for extending rights of audience to CPS prosecutors was the saving of money. I have never ever said that.
First, my budget is entirely distinct from the budget of the Crown Prosecution Service and I concede that my budget will be completely unaffected by the removal of a restrictive practice affecting employees of the CPS in order to extend their rights of audience. Throughout, I have addressed the principle of the matter and the objectionable nature of the restrictive practices in principle.
I would now like to address the actual subject matter of the noble Lord's amendment. It is intended to limit the cases in which employed advocates can prosecute in the Crown Court. In practice, it would apply principally to Crown prosecutors. The amendment would limit them to the least serious category of cases which are tried in the Crown Court; Class 4 cases. These are defined in the practice direction on the classification of the business of the Crown Court as cases involving offences of wounding or causing grievous bodily harm with intent; robbery or assault with intent to rob; incitement or conspiracy to commit these offences; conspiracy at common law; conspiracy to commit any offence other than a Class 1 or a Class 2 offence; and all offences which are triable either way.
For the benefit of the Committee, perhaps I should explain that Class 1 offences are the most serious; for example, treason and murder. Class 2 offences include manslaughter and rape. Class 3 offences cover those triable only on indictment which are not in Classes 1, 2 or 4. Perjury would be an example. Class 4 offences can be tried by a High Court judge, a circuit judge, a recorder or assistant recorder, but they would normally be tried by a High Court judge and cannot be listed for trial by a High Court judge without his permission or
1156
that of a presiding judge. I believe that by a slip of the tongue I said that Class 4 offences would normally be tried by a High Court judge; I should of course have said that they would not normally be tried by a High Court judge without the special permission to which I referred.
The amendment would also ensure that if a Class 4 case were listed before a High Court judge, a Crown prosecutor could not appear before him. I cannot see any case for this amendment, even from the point of the noble Lord, Lord Kingsland. It seems to be that either Crown prosecutors and other employed lawyers are qualified to appear in the higher courts or they are not. I know that some of your Lordships oppose all rights of audience for employed lawyers in the higher courts. That seems to me to be a position which, although I do not accept it, is intellectually coherent. The proposition that Crown prosecutors should be able to appear in some Crown Court cases but not in others does not appear to me to be principled. It rather appears to me to be clearly designed to create a no-go category of a significant legal category of work in the Crown Court for everyone but the Bar. I cannot regard that as defensible.
The Government's firm view is that Crown prosecution and other employed lawyers are eminently qualified to appear in the higher courts. After all, they are qualified barristers or solicitors who have met the normal requirements for exercising rights of audience in the higher courts and are members of professional bodies with effective codes of conduct and disciplinary mechanisms. I do not accept that Crown prosecutors are second-rate lawyers who should be statutorily confined to the lesser classes of criminal work.
No doubt some Crown prosecutors will prove to have a greater aptitude for higher court advocacy than others. But that is no different from barristers in private practice. Crown prosecutors are subject to the same standards as their equivalents in private practice. Furthermore, by opening up their rights of audience in the higher courts, this Bill will make a career in public service more attractive to very able advocates. I do not accept that there is any sensible reason for preventing such advocates from appearing before a High Court judge in a criminal case.
If the real motive behind the amendment is to reserve an area of work for the Bar, then I must say that it is unnecessary as well as being wrong in principle. In practice, in my view, there is no possibility of the CPS taking over the majority of the prosecution work in the Crown Court as it does not have the manpower to do that. But it is not appropriate to reserve by statute certain areas of work to the privately practising Bar.
There is another flaw in the amendment but it is technical. It is contingent upon the existence of a particular practice direction which was made by the late Lord Taylor with the concurrence of my noble and learned predecessor in 1995. That practice direction provides for the existence of Class 4 cases and defines what they are. But my noble and learned friend Lord Bingham of Cornhill, the Lord Chief Justice, could revoke or change the practice direction at any time, and with my concurrence. The amendment would

1157
then be rendered meaningless. On those grounds, I hope that the noble Lord will agree to withdraw his amendment.
I prefer to write definitively to the noble Lord, Lord Thomas of Gresford, on the subject of pilot schemes. I shall give him my present understanding of the present situation but I do not wish to be tied to it. I believe that the pilot schemes to which he refers allow solicitor advocates in the Crown Prosecution Service to exercise their current limited rights of audience in preliminary proceedings in the Crown Court. Because of the current state of the rules, to which, as the noble Lord knows, the Government fundamentally object, they are not even allowed to appear in a substantive hearing on their own. Therefore, pilot schemes cannot extend further than I have just described. However, I prefer to write more comprehensively to the noble Lord on that subject.
5 p.m.
Lord Hacking: I agree with my noble and learned friend. Perhaps I may add one short rider of my own. There can be no better example of the saving of time and duplication of legal effort than when a plea is to be tendered by an accused before the Crown Court or the High Court. That seems to be an occasion on which it would be sensible for a member of the Crown Prosecution Service to appear directly before the court. The effect of this amendment would prevent that.
Lord Thomas of Gresford: I am most grateful to the noble and learned Lord for what he said in answer to my query. But perhaps I may turn to the substance of the amendment. The noble and learned Lord does not seem to recognise gradations in the experience of Crown Prosecution Service employees. His argument is that once they are entitled to appear in the Crown Court, they are entitled to appear for all purposes.
Gradations are recognised in the judiciary. There are assistant recorders, recorders, circuit judges and High Court judges, each of whom has his area of responsibility and the lesser cannot take on the role of the greater. The gradations are recognised.
When it comes to the independent Bar, a barrister who is employed to prosecute is subject to the discipline or restriction of the fact that he is instructed to do so by the Crown Prosecution Service. He is instructed because he has the necessary expertise to take on the case which the Crown Prosecution Service wishes to be prosecuted.
There is a danger that a Crown prosecutor may instruct himself to appear in a case which is way beyond his capacity. I do not welcome the use of the phrase "restrictive practices" and the criticism that we wish to defend them. That is not the case. We are concerned to ensure that prosecutions are carried out properly in those courts; that guilty people are convicted and innocent people are acquitted. It happens to be that most of us with experience in that field, from all parties, take the
1158
view that some of the provisions militate against that aim. That is the purpose of the criticisms which we make.
The Lord Chancellor: We can carry forward this argument in wearisome detail. I should have found that point more impressive from the noble Lord if the current position, as it affects the Bar, was not as it is. Today, the day after a barrister emerges from his pupillage with full rights of audience, he can prosecute or defend a murder at the Old Bailey or appear in your Lordships' House in its judicial capacity, if fortunate enough to be briefed at any of those levels. There is no restriction whatever on that.
Lord Thomas of Gresford: With the greatest respect, the noble and learned Lord has not appreciated my argument. I am sure it is my fault. No Crown prosecuting service will instruct a newly-fledged barrister to appear in a murder case or in the House of Lords. That is why there is that control. The difference with a Crown prosecuting service employee is that he instructs himself and may instruct himself to do more than he is capable of.
The Lord Chancellor: Perhaps I may say with respect, and without wearying the Committee, that the noble Lord makes my point for me. Just as I doubt that a solicitor, on my first day in fully-fledged practice, would instruct me in an appeal to your Lordships' House in its judicial capacity, nor would the chief Crown prosecutor sanction a prosecutor prosecuting a murder, although he had full rights of audience, if he was comparatively inexperienced. Those matters are dealt with by the sensible judgment of those who, in private practice, brief barristers with full rights of audience. The chief Crown prosecutor will determine the allocation of business according to appropriate experience. The noble Lord makes my point for me.
Lord Kingsland: In thanking the noble and learned Lord for his reply may I say first of all that there is no suggestion lying behind this amendment that the employees of the Crown Prosecution Service, while legally qualified, are in any way second rate. That is not something that is implied in that amendment and it is certainly not something that I believe. The basis for the objection is, I repeat, the danger of conflict of interest.
I listened with great interest to what the noble and learned Lord said about his budget, and of course I entirely accept that his budget will not be affected by this change. But somebody else's budget will be and therefore the taxpayer will be. I should have thought that one of the matters to which the noble and learned Lord ought to have addressed his attention in respect of the budgetary implications of what he is doing is other parts of public expenditure. He did not address, and I can quite understand why, the competition points I made. I therefore wish to think about those and perhaps come back at Report stage.
The Lord Chancellor: Before the noble Lord sits down, I wonder if, for the information of the Committee,

1159
he will clarify why he does not think that Crown Prosecution Service lawyers are in theory lawyers but is concerned with the conflict of interest. If Crown Prosecution Service lawyers are affected by conflict of interest, is his true position that none of them should have any rights of audience?
Lord Kingsland: As far as my amendment goes, I do not know whether they would be affected by conflict of interest because they are not yet in that position. What I am saying is that there is a danger that they would be. That is the substance of my argument. I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 31, as amended, shall stand part of the Bill?
Lord Ackner: Shortly before midnight on Tuesday I was unsuccessfully addressing the Committee on the desirability of removing Clause 30 which deals with rights of audience of barristers and solicitors. Although I failed in persuading your Lordships to remove Clause 30, I think I succeeded, partially with the help of the correspondence which was referred to as passing between my noble and learned friend the Lord Chancellor and his predecessor, in establishing that the consequences of what is proposed in Clause 30 would be a reduction in the quality of the advocates who emerge. This follows quite simply from the fact that only 1 per cent. have sought to do advocacy, despite their entitlement, for the last five years, and the high proportion of failures in regard to tests which their own organisation thought appropriate. Therefore, for the rights of audience by solicitors to be extensive, standards inevitably would have to come down and the courts would be the unhappy recipients of that drop in quality.
In regard to Clause 31, which deals with rights of audience of employed advocates, I should be able to demonstrate the same though by a different route. I accept that the 1990 Act was intended to allow solicitors in private practice to obtain the right to appear in any court, subject always to their being properly qualified and trained to exercise those rights.
With deep respect, the noble and learned Lord the Lord Chancellor was in error in his foreword to the Way Ahead paper in saying in the third paragraph that the 1990 Act was also intended to enable employed lawyers such as Crown prosecutors to appear in the higher courts. I say that because on 22nd February 1990, on an amendment moved by the noble Lord, Lord Hutchinson, the then Lord Chancellor, the noble and learned Lord, Lord Mackay of Clashfern, said:
"This Bill sets up a framework under which matters of rights of audience and the conditions under which they can be exercised are to be determined in the light of advice from an independent advisory committee appointed by the Lord Chancellor in accordance with rules to be proposed by the professional bodies, which will become effective only if they are approved by the four heads of division, the designated judges, and the Lord Chancellor. That is what we are concerned with. There is no question of my having put forward this Bill in order to bring rights of prosecution to the Crown Prosecution Service except in accordance with decisions taken under that machinery".—[Official Report, 22/2/90; col. 41.]
1160
At col. 413, he added:
"I entirely accept the view that there are important considerations as to what extent any part of the prosecution service—that refers not just to the CPS but to all prosecuting authorities—should use salaried employees to present cases at any stage".
He made it perfectly clear that this particular question was a debatable one and that the debate would have to be concluded before the prosecution authorities could establish any right of audience. It was generally accepted that the extension of rights of audience in the higher courts to employees was highly debatable.
In the judges' response to the Green Paper in 1989, paragraph 91, it was stated that any such extension of rights of audience would have the following disadvantages:
"(a) An advocate who is an employed lawyer would have a personal interest in the success of the case he was presenting since he might believe that his chances of promotion depended on his success. In consequence he would be subject to conflict between his duties to the court and his interest in furthering his case. The Government recognise the problem but believe it should be possible for appropriate codes of conduct to guard against the conflict of duty and interest. The judges are not so optimistic.
(b) At present one of the protections for those charged with serious criminal offences is that the advocate having the conduct of the prosecution is independent of the prosecuting authority. An employed prosecutor, whether in the Crown Prosecution Service or another department, may be tempted to press for a conviction in a way which is foreign to the English criminal trial system.
(c) An adversarial system of trial makes it desirable that advocates in the criminal court should have experience both of prosecuting and defending. Such experience helps the advocate to be open minded and to present his client's case in a way which at all times reflects his duty to the court".
That was said in 1989.
Professor Zander has not been known for his affection for the Bar or for his desire that the status quo remains but he wrote a powerful letter to The Times on 18th December. Among his observations are these:
"In the Crown Court study I conducted for the Runciman Royal Commission on Criminal Justice during 1993, we asked respondents to bring to the attention of the commission any matter of concern. The main general concern identified by prosecuting barristers was disagreements with and undue pressure from the CPS on individual cases. At present, such disagreements and pressure are dealt with by discussion between the barrister and the CPS representative. If the CPS has and exercises full rights of audience, that created tension between differing views would be lost. The decision as to how to handle the case, whether to accept a plea in itself on what charges, etc. would be handled by the CPS alone. In my view that will result in a regrettable deterioration of decision making in serious criminal cases. The loss will be in the quality of that elusive concept, justice".
When I made my submission on Clause 30, the noble and learned Lord, Lord Falconer, moved over from commenting on Section 30 to Section 31. I want to criticise strongly one specific comment and, in doing so, I recognise the great ability of the noble and learned Lord but also that, like many others at the Bar—both past and present—one is sometimes given a case with which one wholly disagrees, but which it is one's obligation to put forward.

1161
In moving over to Section 31, the noble and learned Lord said this:
"Those restrictions on employed barristers and solicitors are unjustified. They are the worst kind of restrictive practice—designed simply to protect the work and incomes of privately practising barristers, with no shred of benefit to the public".—[Official Report, 26/1/99; col. 997.]
I appreciate that the noble and learned Lord was obliged to carry out his instructions and I sympathise with him. But that was a wholly unjustified observation redolent of one of the unfortunate features of excessive power; namely, arrogance. It overlooked what I had already said in relation to the judge's comments on the Green Paper, but it also overlooks a great deal of back history and, briefly, I shall draw attention to part of that.
When the Crown Courts were created in 1971 the Courts Act empowered the Lord Chancellor to give directions on the respective rights of audience of barristers and solicitors in the Crown Court. In giving his first direction under the Act, the Lord Chancellor of the day—the noble and learned Lord, Lord Hailsham—said in the House of Lords on 9th February 1972,
"I find no sufficient reason for altering the present balance between the Bar and the solicitors' profession in the conduct of prosecutions, whether by public authorities or private individuals. I must also emphasise that I regard the presentation of a prosecution case in the higher courts by counsel, properly instructed by a solicitor, as an added safeguard of individual freedom since it involves that a second opinion is always brought to bear".—[Official Report, 9/2/72; col. 1139.]
The matter was considered by Lord Benson in the Benson Commission. At paragraphs 18.43 to 18.45 of his report he said this:
"In one significant aspect the arrangements serve what many of us regard as an important public purpose by ensuring that in the Crown Court the case for the prosecution is put by an advocate who is independent both of the police and the prosecuting authority. Whatever the outcome of the Royal Commission on criminal procedure [the Phillips Commission] we think that the effect of the present arrangements on prosecuting work should not be disturbed. It provides in every case an advocate from the available range of private practising barristers who is seen by the court, the accused and the public at large, to be independent of the police and the prosecuting authorities; one who, by the nature of his training and daily practice, is more likely to be able to bring the essential quality of detachment and balance to bear on the problem in the individual case. These are considerations that we regard as crucial, not only to the actual conduct of a jury trial, but also the proper administration of justice in general, including the institution or continuance of criminal proceedings, the acceptance of proposed pleas of guilty and the proper handling of evidential problems".
Is that an example of the worst kind of restrictive practice? Is that a restrictive practice designed simply to protect the work and income of private practitioners? Can it be said that that practice contains no shred of benefit to the public?
I wish to make a few other short points. The Phillips Commission was split, but the majority came out in favour of retaining the status quo. The Government's response to the Benson Royal Commission report was presented to Parliament by the Lord Chancellor in a White Paper which agreed with the observations of the Benson Commission; that is, that there should be no general extension of rights of audience for solicitors. The White Paper also accepted the recommendation of
1162
the Royal Commission which was published by the Government in regard to rights of audience. As a consequence of the report of the Royal Commission on Criminal Procedure, the Government introduced a draft Bill—the Prosecution of Offences Bill—into the House of Lords in the autumn of 1984. On 29th November 1984, when introducing the Second Reading, the Minister of State (then the noble Lord, Lord Elton) said,
"I should emphasise that the Government hold strongly to the view that rights of audience in Crown Court trials should continue to be confined to an independent Bar which both prosecutes and defends".—[Official Report, 29/11/84; col. 1017.]
He wrote a letter to the noble Lord, Lord Wigoder, on 12th December 1984 saying,
"There is no intention to extend these rights of audience any further; for example, to include the conduct of criminal trials before the Crown Court. In this connection the Government have recently reaffirmed their acceptance of the Benson Commission's recommendation that, in general, rights of audience in the Crown Court should be the preserve of the independent Bar".
It is interesting to note that the right honourable John Morris, as he then was, in a debate on the Bill in the House of Commons when he was shadow Attorney-General, said:
"Despite the Government's assurances, I fear the long-term future, perhaps not so long of the criminal Bar. What will happen when the Treasury gets its hands on that? Who can put his hand on his heart and say that in five or 10 years' time there will not be a Rayner Report, or something of that ilk, which advocates more and more inhouse work? I fear that that will be the Treasury approach as sure as night follows day and that it would strike at the heart of an independent profession which I believe to be one of the bastions of liberty".
He had considerable foresight because I believe that there has been considerable Treasury input into what is proposed. The Lord Chancellor's advisory committee was expected to produce a recommendation that the employed lawyer should have a right of audience and it was a matter of deep sadness to the Government when it was discovered that the independent advisory committee was a great deal more independent than they had anticipated.
The report of the advisory committee, by a majority, proposed no rights of audience for the Crown Prosecution Service. It is a lengthy and closely-reasoned document. Nowhere has it been referred to, even by way of a cut-down description. I respectfully suggest to the Committee that the words of my noble and learned friend Lord Falconer, which I have emphasised, show the shallowness of the Government's approach to the consequences of what they propose. I oppose the Question that the clause stand part of the Bill.
5.30 p.m.
Lord Hacking: The central point identified by the noble and learned Lord in his opposition to the use of employed lawyers is the vested interest point. He quoted from the paper that the judges issued in reply to the Green Papers on access to justice published last summer. Here they put the argument, as precisely submitted to Members of the Committee by the noble and learned Lord, that a lawyer in the Crown Prosecution Service would have a vested interest in success because it would affect and benefit his chances of promotion.

1163
I have argued this before with the noble and learned Lord. In every case, whether you are a barrister or a solicitor, you have a vested interest in success. Success brings you more cases and a greater income. Crown prosecutors at the Old Bailey have a vested interest in success because they get bigger and better cases, and more well paid cases. Every barrister in private practice has a vested interest in success because his practice will improve. Indeed, the noble and learned Lord had an illustrious career at the Bar. I remember him well as a senior member of the Bar after I had been admitted. His practice went far because he was successful and had the good habit of winning cases. That is always a factor in the practice of law. But what every barrister and solicitor does when appearing before the court is to put the interest of justice first. He lays aside that vested interest in success because he has an overriding duty to the court.
It is a fatuous argument. It is most surprising that it is produced again and again and has apparently been produced in the judges' paper.
Lord Hutchinson of Lullington: I have given notice of my intention to oppose the clause. I should like to support all that the noble and learned Lord, Lord Ackner, has said. I remind the noble and learned Lord the Lord Chancellor that at Second Reading he said that he had not come upon any rational argument that could be advanced against salaried prosecutors. I do not know whether he takes the view that the Benson Report, the other Royal Commission, and the whole of the noble and learned Lord's speech today are all irrational. It is true that throughout the debate on this matter the noble and learned Lord has not dealt with the arguments put forward at length in the reports of the two Royal Commissions and, indeed, in other places.
The amendments to the clause dealing with salaried prosecutors, which were tabled by the noble Lord, Lord Thomas, were dealt with after midnight yesterday. That was thought proper by the Government despite the knowledge that the issue of the rights of audience of salaried prosecutors was highly controversial and the opposite side of the coin to the issue of salaried defenders which took up two hours of the time of the Committee and attracted no fewer than 15 speakers.
The noble and learned Lord, Lord Simon of Glaisdale, has inveighed repeatedly against this ploy of taking controversial clauses in a Bill at a time when it is known perfectly well to the Government that almost no noble Lords will be present—in fact, there were only three or four. I regret to say that that ploy will not save any time at all. The arguments which could not be put on that occasion by me, because I could not possibly have been here, will be put now.
One of the remarks which the noble and learned Lord made to an almost empty Chamber in the early hours of the morning, echoing what the noble and learned Lord, Lord Ackner, has just said, was that these amendments can be recognised as a set of special pleadings by the Bar. That, I suggest, is simply to lower the level of debate and to mislead Members of the Committee who have the advantage of not being lawyers. At my age, and 15 years after retirement, I do not come to this House to
1164
peddle trade union trivialities, nor do either of my noble friends on our Front Bench, nor the noble Lord, Lord Wigoder. I would add that neither do the two most distinguished Members of the criminal Bar on the other side of the Chamber. I refer to the noble Baronesses, Lady Mallalieu and Lady Kennedy.
I deprecate the constant disparagement coming from the Government Front Bench and, indeed, the proximate Back Bench, of the criminal advocate and the constant harping on about restrictive practices and money. There is a pejorative use of the words "restrictive practices" which we all understand. Many restrictive practices are absolutely essential in any profession to ensure suitable and appropriate expertise.
The clause is wrong as a matter of principle; one which, as we have heard from the noble and learned Lord, Lord Ackner, has been debated and considered over many years. The Lord Chancellor knows perfectly well that the overwhelming majority of all those who are involved in the actual practice and study of the criminal law—that is, barristers, solicitors and academics—are against the aims of the clause and are deeply concerned about its implications. The Bar has not objected to the clause giving rights of audience to solicitors. We are all involved in this matter together: all lawyers and advocates on the criminal side. What we are considering is the question of the independence and the whole-time commitment of the prosecuting advocate, whoever he or she may be. It is simply ridiculous to describe this debate as a trade union debate in relation to the Bar.
Today, in the higher courts with judge and jury, where the citizen is in jeopardy of losing his liberty and reputation for a very long period of time, prosecutions are placed in the hands of responsible, whole-time advocates who are wholly independent of state, police and government departments. The advocates are the mirror image of the judges who try the cases and who must depend on the advocate to make it possible for them to carry out their duties. These advocates seek, with varying degrees of success, to display the same essential qualities which are to be found on the Bench; namely, independence and integrity. As we have recently seen, for a judge independence means having no special interest which might appear to dilute his independence or his impartiality.
Exactly the same principle applies to the prosecutor in the higher courts. He must act throughout as a minister of justice, presenting the facts fairly and without passion before the jury. His only motive must be the interests of justice; he is not parti pris and he must be detached. That is the tradition in England and Wales in the criminal courts. If I may say so, it is that which keeps the criminal process uncorrupt and fair. This may be denigrated by the noble Lord, Lord Bach, with his tales of tittle-tattle in his robing room in Leicestershire—wholly unrecognisable to such a dinosaur as myself. However, whatever may be rightly said about delays and imperfections in the criminal process, a criminal trial in this country remains the most uncorrupt and the most fair in the civilised world and is recognised as such.

1165
Prosecutors here are perceived by defendants and the public for what they are and for what they are not. They are not civil servants and they are not subject to the pressure of preferment. They do not have conflicts of interest between duty to employer and duty to the court. They have no direct access, and they are available to appear for the defence. That is the situation today. They do not claim, as the noble Lord, Lord Bach, (who, we all appreciate, is part of the Lord Chancellor's team) seems to think, some spiritual calling or some mystical relationship with each other. Similarly, they do not consider themselves, as the noble Lord seems to think—although, for all I know, this may apply in Leicester—superior to teachers or doctors. On the contrary, teachers and doctors are the colleagues of prosecuting and defending barristers and solicitors in the criminal court. They, too, have a vocational approach to their work: namely, that there is more in the work than just money.
Of course the independent prosecutor must act on instructions and must consult before making crucial decisions; but, finally, the decision and responsibility is his and his alone. Even if he is Treasury counsel, his place of work—all "Treasury counsel" means is that he in fact holds himself open to give the Director of Public Prosecutions priority in his work—is in a group of other sole practitioners at arm's length from the police, from the witnesses, from politicians, from civil servants and from all those who may apply pressure or seek to influence. He must be available at all times to those who require his services.
Once that advocate is employed and salaried, working daily and solely in a department with its own culture and preparing cases from start to finish in the closest proximity and co-operation with the police (and their culture), or with government departments, local authorities, or indeed in corporations, carrying out their instructions, he cannot possibly be anything other than partisan. When the question of a code was suggested in our earlier discussions with the noble and learned Lord, it very quickly became a matter of our getting into "deep waters"—that is, deep waters because of everything that I have just said. There is no possibility of having a code which can cover those two forms of advocacy in conducting prosecutions. Every criminal advocate knows that in-house lawyers—that is lawyers from the DTI, from the Inland Revenue and from Customs & Excise—are clearly and fiercely partisan. Indeed, it is the whole of one's experience. Of course that is so; they are there in order to further the perceived interests of their own departments.
With the greatest respect, it seems to me that the noble and learned Lord the Lord Chancellor will simply not face up to these points. If I may say so, some of his justifications in his midnight argument for the salaried prosecutor almost descended into farce. The noble and learned Lord, Lord Donaldson, has already dealt with the first argument that judges are paid by the state and they are independent; therefore, why are prosecutors in the office of the DPP not equally independent? The noble and learned Lord shot down that argument.
1166
The noble and learned Lord's second argument was that salaried lawyers prosecute in the magistrates' court, so why on earth should they not do so before judge and jury? Members of the Committee will appreciate that police officers conducted their own cases in the magistrates' courts only a short time ago. No one that I know of has suggested that they should conduct cases in the Central Criminal Court.
The noble and learned Lord's final argument really proves the point that I am seeking to make. He said how bizarre it was to suggest that Dame Barbara Mills should forfeit her right to appear in the higher courts on her appointment as Director of Public Prosecutions. There it is. It is the job; it is not the personality that we are talking about. Will it really be suggested by the noble and learned Lord that Dame Barbara Mills is eminently suited to go down to the Central Criminal Court and conduct her own murder cases in front of the High Court judge? Further, will it be suggested that, when he was Home Secretary. Mr. Kenneth Clark, QC should have gone down to the Old Bailey and conducted official secrets cases? Is it the suggestion that once you are a barrister you are a barrister and you should have full rights of audience? I suggest that it is not the personality and the qualifications; it is the job that you are doing which makes it wholly inappropriate.

Finally, I should like to return to a particular point because it illustrates what I am saying to the hilt. I ask the noble and learned Lord to read the Scott Report if he has not already done so. The Scott Report is a monument to the crucial role of the independent prosecutor. The Matrix Churchill case in a nutshell concerned the suggestion by the Government that this company and its managing director, Mr Henderson, were deceiving the Government by putting forward licences which were in themselves deceitful in sending military goods to Iraq. The Attorney-General instructed Ministers that they were to sign certificates to say that the internal documents in each department could not be disclosed to the defence because that would be against the interests of the state and, as regards MI6, would put innocent persons' lives at risk. The gentleman's defence was that Ministers knew perfectly well what was implied in the licences, that they tipped the wink as regards the form of the licences, and that far from being deceitful he was going to Iraq and giving information to MI6 which was of the greatest possible value to the Government.
The prosecuting counsel was instructed to urge the judge to maintain that ban on those internal documents which would prove the innocence of this man and his company. His instructions were to urge the judge to do that. One of the Ministers, the only Minister who was not a member of the Bar—the other three all were, and two of them were Queen's Counsel—objected to signing the document because he could see perfectly plainly that the documents would be of use to the defence. He requested that that objection should be conveyed to the judge. What did Scott find? First, he found that there was no justification for those certificates. Secondly, he found that the judge had never been told—because prosecuting counsel had never been told—of the Minister's objection to signing the certificate. Thirdly,

1167
he found that the law that he was told to uphold in court based on the civil law was entirely unapplicable to a criminal case. Fourthly, he found that lawyers in the departments concerned took the course of holding back documents rather than applying their minds to whether or not they would help the defence. Finally, he found that government lawyers altered witness statements in order to fit in with the departmental policy.
Could there be any more condemnatory example of what happens when lawyers act for the Government, and when even trained barristers are in political positions? Luckily, counsel for the Crown, Mr Moses, behaved as one hopes independent counsel would do. When he saw that there was a possible miscarriage of justice ahead of him, he, totally on his own initiative, decided that these documents should of course be released to the defence. On his own initiative he asked the judge to go back on his ruling that the intelligence documents should not be allowed to be revealed, and after consultation with the Attorney-General, and having told him of his views, brought the whole prosecution to an end.
I have taken up time in referring to that case. It was only because there was an independent prosecutor, independent of the departments concerned and independent of the Government, and a defence barrister who was prepared to maintain the pressure on the prosecution, that there was not a fundamental miscarriage of justice. Anyone who has read the Scott Report will see that if the four lawyers in that case had been government employed lawyers, there would have been no possibility whatever of that company and that managing director being acquitted. Indeed in a case that preceded that one concerning much the same situation, the barristers were not sufficiently independent. They gave the advice that the defendant should plead guilty. Some form of plea bargaining was arrived at and it was only after the Scott Report that that case was returned to the Court of Appeal, the plea was set aside and a miscarriage of justice which had taken place was set right.
That is all I say in support of the noble and learned Lord, Lord Ackner. A state prosecutor and a state defender are both made possible under this Bill, supervised by members of the executive, the Attorney-General and the Lord Chancellor. That surely raises a somewhat menacing matter of principle worthy of further consideration and worthy of consideration by the Committee.
Baroness Thornton: I have just witnessed the Committee taking its gloves off. I have witnessed what one might perhaps call a bit of noble mud wrestling. I believe that the noble Lord, Lord Hutchinson, and I inhabit different planets. It is simply not accurate to say that the legal profession is held in such high esteem. I wish that that were the case. It is true that members of the legal profession are held in higher esteem than politicians and journalists, but that probably is not saying much! The reasons for that are several. One reason is that not many ordinary people have access to the law. A second reason is that people believe that
1168
vested interests and restrictive practices are involved which do not make the law accessible to ordinary people.
I have listened to the debates on rights of audience that have taken place today and which took place late into the night on Tuesday. I confess that I am not convinced by the arguments that I have heard against change. I do not expect that my noble and learned friend Lord Falconer will have any problem in addressing the points that have been made. However, there are times in political life when people plainly do not agree with each other, and do not agree about the way forward. I believe this is one such occasion. When this happens, we need to consider democratic legitimacy. The Government have democratic legitimacy on their side on this occasion.
An irresistible thought keeps popping into my mind, and has done throughout this debate when Members of the Committee talk about maintaining standards and the protection of independence, both of which are issues of enormous importance and are the essence of the Bill. It occurs to me that one hears such remarks from some quarter whenever there is a proposal to make a procedure more democratic or to make it accountable or to ensure competition or, as in the case we are discussing, to remove restrictions and outmoded rules which no longer have a place in modern society.
In this case, we are largely talking about unfinished business. While I hated and deprecated many of the activities of the previous government and campaigned and worked against them, I also recognised that from time to time, particularly under the leadership of the then Prime Minister, the noble Baroness, Lady Thatcher, they did go in for "busting" restrictive practices of various sorts. Despite the gallant efforts of the then noble and learned Lord the Lord Chancellor, they failed to bust this particular restrictive practice in any significant manner. The Government now seek reforms that are long overdue.
It does not reflect well on the legal establishment, which sees itself, with justification, as a world-class industry. It is a question of confidence. I hope that the legal establishment will have the confidence to modernise and to shed the remnants of practices that date back many years and were designed to meet the problems of an earlier time. I urge my noble and learned friend the Lord Chancellor to resist this amendment.
6 p.m.
Lord Wigoder: For many years I used to begin a speech with the words, "Members of the jury, it is my task to follow the powerful observations of my learned friend Mr. Hutchinson". Perhaps I may begin these few observations in that same way.
When I was first at the Bar, I went to a set of chambers where one of the senior members was a very junior Treasury counsel at the Old Bailey. He rapidly rose, and eventually became the senior Treasury counsel and acquired great reputation. He taught all those in his Chambers the rudiments of good prosecuting: the role of the prosecutor as a minister of justice pursuing the fair administration of justice.

1169
I went out into the wide world and, for many years, conducted a largely prosecution practice. I came across prosecuting solicitors who, in total defiance of the evidence, asked me to press for a conviction. I came across prosecuting solicitors who were appalled when I said that of course we must hand over to the defence information that the police had acquired that would be of assistance to the defence and would not be used by the prosecution. I came across prosecuting solicitors who regarded every conviction as a win and every acquittal as a defeat. I discovered that some offices had league tables on the walls containing the names of prosecuting solicitors and the barristers they had instructed, and whether they had scored convictions or had failed in certain cases. In recent times I have come across cases where prosecuting solicitors have told me that, on applying for a change of job to another prosecuting solicitor organisation, they have been asked many questions about their conviction ratio as though it were a qualification for promotion or a successful transfer.
I make those observations subject to two qualifications. First, I am speaking of a time many years ago—I shall not answer any questions as to exactly how many years ago. Secondly, I do not want to exaggerate the position. Of course one came across many prosecuting solicitors who behaved in a totally exemplary way, and who could be trusted beyond any question to exercise the rights of audience that are being given to them under this clause of the Bill in a way that would have been wholly admirable. On the other hand, I must concede that there were some members of the Bar who, when prosecuting, did not uphold the kind of standards that they should have done. Whether that was through ignorance or through a subconscious desire to please a person who would obviously be the source of much future work, I do not know. But at least those kinds of cases were dealt with by the type of machinery that I indicated in an earlier intervention.
Without seeking to exaggerate—and I do not for one moment categorise all prosecuting solicitors as incompetent or unfair—I was left in no doubt that if, as a whole, those prosecuting solicitors had been given rights of audience in our senior courts, the result would have been a lowering of the general standards of the prosecution advocate. I accept that that is not the end of the matter. There could be training facilities for such people and standards could be enforced. I shall return to that point shortly. That was the position as I found it, and as I believe it largely still is. I must stress that I want to be totally fair. The Crown Prosecution Service is now led by a man of the highest possible standards as Director of Public Prosecutions. I have no doubt that he will do his best to co-operate if the circumstances set out in the Bill become law.
It is my wish to be realistic. I accept that there is such a thing as parliamentary arithmetic. I accept that the noble and learned Lord the Lord Chancellor has for some time—as has been made clear in a number of his observations—been deeply committed to the principles that are set out in Clause 31. Throughout this Committee
1170
stage, the noble and learned Lord has made a series of major, generous concessions unequalled by any Government Minister in conducting a Bill in this House.
Noble Lords: Hear, hear.
Lord Wigoder: My Lords, having said that, I must add that I do not think any advocacy of mine will persuade the noble and learned Lord to make a similar major concession when he rises to reply to the noble and learned Lord, Lord Ackner. Therefore, perhaps I may look for a moment to the future and to what will happen if this clause stands part of the Bill. The crucial matter is one of standards of advocacy among prosecuting solicitors who are being given rights of audience.
I come now to the second half of the observations that I was seduced into making earlier by the words of the noble and learned Lord, Lord Woolf. I shall certainly not repeat them at this juncture. In all probability the question of maintaining high standards among those who are newly granted rights of audience is crucial if we are to move forward in the way in which the noble and learned Lord is anxious that we should.
I asked the noble and learned Lord a number of questions earlier about not only the code and the disciplinary body but the actual machinery on the ground that will detect breaches of the code and see that they are remedied. The noble and learned Lord said that he would rather not deal with that matter this afternoon, and I fully understand his reasons. I should be grateful for an indication from him that at some stage during the Bill's passage, possibly when we consider Clause 36 if that is thought appropriate, he may be able to give us a clear indication as to how he sees the future in this respect and how the safeguards are to be maintained in order that prosecutions can retain, if possible, the standard that they have always had in this country.
Lord Goodhart: The question of the rights of audience of CPS employees is an extremely difficult issue on which different views have been held strongly by individuals among my noble friends. The Committee has heard some of them expressed today—however, all on one side.
I must explain that the view taken by my party in this House is that those who have participated in the debate in this Committee will report back to our colleagues before the Report stage and the party will then decide how to recommend its members to vote. It follows that no decision has yet been taken on how we should vote on the issue and so I do not intend to express views of my own which would at this time be purely personal.
I hope that the noble and learned Lord and my noble friend Lord Hutchinson will not divide the Committee today on Clause 31 because it is preferable to defer the vote to the Report stage. If we vote today, then we have recommended our members to abstain, recognising that some may feel it impossible to do so.
6.15 p.m.
The Lord Chancellor: I well recognise that the noble and learned Lord, Lord Ackner, and the noble Lord, Lord Hutchinson of Lullington, have deeply held convictions on the subject, as do others. However, it is also the fact that the arguments that we have heard now for almost one hour on the Question that Clause 31 do not stand part of the Bill have been fully canvassed in our debates on previous specific amendments.
I also have to say, as gently as I can, that the noble and learned Lord, Lord Ackner, took 20 minutes to develop his arguments in Committee. That hand was fully dealt. The noble Lord, Lord Hutchinson, dealt his even more fully at 22 minutes. I propose to be brief, in recognition that we have a long night ahead of us and there are many other amendments dealing with different but also important issues. I do not propose to enter upon battles of long ago, however much that might contribute on the part of the noble and learned Lord, Lord Mackay of Clashfern, to a sense of déjà vu. I rather suspect that he would prefer to be spared that experience. Therefore, I shall not embark on those battles of long ago.
Clause 31 inserts a new Section 31 A into the Courts and Legal Services Act 1990. It would have the effect of invalidating any contract rules or qualification rules of professional bodies which restrict employed lawyers from undertaking advocacy work where their counterparts in private practice are not similarly restricted. As barristers, employed barristers have theoretical rights of audience in all courts, but in practice they may not exercise many of those rights because they are prevented from doing so by the Bar's code of conduct which prevents employed barristers from appearing in the higher courts.
Similarly, the current rules of the Law Society in the terms approved in 1997 by my noble and learned predecessor and by the designated judges prevent an employed solicitor from appearing as the sole or senior advocate in substantive proceedings in the higher courts. They can appear only if led. That means that solicitor Crown prosecutors who have obtained the Law Society's higher courts criminal qualification are nevertheless unable to appear on their own in substantive trials in the Crown Court. In my view, that is to endorse a restrictive practice.
The noble and learned Lord, Lord Ackner, submitted to the Committee that the 1990 Act was not intended to allow employed lawyers to exercise rights of audience and not intended to allow CPS lawyers to prosecute. I imagine that it must have slipped his memory that in our proceedings on the 1990 Act the noble Lord, Lord Hutchinson of Lullington, moved an amendment to prevent Crown prosecutors exercising rights of audience in the higher courts. That amendment was defeated.
In truth, the 1990 Act was an enabling Act. It created a procedure for extending rights of audience. But that procedure has failed sufficiently to extend these rights to employed lawyers. That is one of the important reasons the Bill has been brought forward.
1172
The Government do not believe that this discrimination against employed advocates is justified. The provision is designed to give full and exercisable rights of audience to employed advocates, including Crown prosecutors and other lawyers in the Crown service.
I have to say, with the greatest respect to the noble Lord, Lord Hutchinson, which he knows is sincerely felt, I regard the proposition as exorbitant that only the Bar can bring integrity to the prosecution process. I believe that that proposition would be rejected by the overwhelming majority of people in this country. I also have to say that it is insulting to employed lawyers as a class.
I ally myself with the noble and learned Lord, Lord Bingham of Cornhill, the Lord Chief Justice of England and Wales, who said this on Second Reading (at cols. 1125 to 1126 of Hansard for 14th January):
"Six years' experience as one of the designated judges—I have perhaps longer experience in this matter than anyone except the noble and learned Lord, Lord Mackay, and I am not far behind him—persuades me that the existing regime is unsatisfactory. I see no satisfactory alternative other than that proposed. While others disagree—and, I must make it plain, disagree very strongly, even passionately—I do not agree that Crown prosecutors, members of a service led by a very distinguished advocate answerable to an Attorney-General who has made clear his belief in the independence of the prosecuting function, would be likely to exhibit in the higher courts vices of which no complaint is made in the lower".
I add to those words of the noble and learned Lord that I cannot agree with the central argument that employed lawyers are incapable of exercising their duty ethically. The Crown Prosecution Service was set up precisely to provide a barrier between the investigators—that is to say, the police—and prosecutors. No one suggests that CPS barristers should not carry out cases in magistrates' courts, where they do, without any complaint against their ethical standards and where 97 per cent. of criminal cases in this country begin and end.
I emphasise that this clause does not mean that the authorised bodies should not be able to regulate those of their members who are employed lawyers. Of course they will continue to be subject to qualification regulations and rules of conduct, in the same way as their colleagues in private practice. But what is unacceptable is the current situation in which rules prevent qualified advocates from exercising rights of audience simply because they are employed.
I commend Clause 31 and believe that it should stand part of the Bill.
Lord Ackner: After being chided for taking so long in moving my amendment, I shall take little time now in closing. I raise two points only. I was fully aware—and Hansard will show—that the noble Lord, Lord Hutchinson, sought to move in Committee or at some other stage of the 1990 Act, there and then, that employed lawyers in the CPS should not have rights of audience. What my noble and learned friend the then Lord Chancellor did was to say: "No, this will be dealt with by the committee that I have set up and their advice and the reaction of the presiding judges and myself". In other words, he was not going to prejudice whatever the decision should be. In the part which I read out, he accepted that there was room for debate on either side.

1173
My final point is a reference to the Lord Chief Justice. It is sad that the Lord Chief Justice is out of step with his judges. The noble and learned Lord the Lord Chancellor has made no reference at any stage to the lengthy responses put in on behalf of the High Court judges, the Court of Appeal judges and the Inns Committee. They have all strongly said that, in their view, the Lord Chancellor should follow what was done in the 1989 proceedings.
This is a very serious and important point. I am sorry that the members of the Liberal Democrat Party have not yet made up their minds but in suggesting to me that I should not divide the House they have overlooked that I cannot come back on this amendment. As a result of any withdrawal, I cannot next time round invite the House again to take out this clause from the Bill. In those circumstances, as it is now or never, I feel it is only right to divide the House.
6.21 p.m.
On Question, Whether Clause 31, as amended, shall stand part of the Bill?
Their Lordships divided: Contents, 77; Not-Contents, 88.

Division No. 1

CONTETS

Acton, L.

Irvine of Lairg, L. [Lord Chancellor.]

Alli, L.

Amos, B.

Jay of Paddington, B. [Lord Privy Seal.]

Ampthill, L.

Archer of Sandwell, L.

Jenkins of Putney, L.

Bach, L.

Laming, L.

Berkeley, L.

Lovell-Davis, L.

Blackstone, B.

McIntosh of Haringey, L. [Teller.]

Brookman, L.

Mackay of Clashfern, L.

Bruce of Donington, L.

Mackenzie of Framwellgate, L.

Carter, L. [Teller.]

Milner of Leeds, L.

Christopher, L.

Molloy, L.

Clarke of Hampstead, L.

Monckton of Brenchley, V.

Clinton-Davis, L.

Monkswell, L.

Cocks of Hartcliffe, L.

Montague of Oxford, L.

Morris of Castle Morris, L.

Crawley, B.

Nicol, B.

Currie of Marylebone, L.

Pitkeathley, B.

David, B.

Puttnam, L.

Desai, L.

Ramsay of Cartvale, B.

Dubs, L.

Rendell of Babergh, B.

Evans of Watford, L.

Sainsbury of Turville, L.

Falconer of Thoroton, L.

Sawyer, L.

Farrington of Ribbleton, B.

Sewel, L.

Gallacher, L.

Shepherd, L.

Gilbert, L.

Shore of Stepney, L.

Goudie, B.

Simon, V.

Gould of Potternewton, B.

Smith of Gilmorehill, B.

Graham of Edmonton, L.

Stoddart of Swindon, L.

Hacking, L.

Strabolgi, L.

Hanworth, V.

Symons of Vernham Dean, B.

Hardie, L.

Thornton, B.

Harris of Haringey, L.

Trefgarne, L.

Hayman, B.

Turner of Camden, B.

Hilton of Eggardon, B.

Uddin, B.

Hollis of Heigham, B.

Walker of Doncaster, L.

Hoyle, L.

Whitty, L.

Hughes of Woodside, L.

Williams of Elvel, L.

Hunt of Kings Heath, L.

Williams of Mostyn, L.

1174

Winston, L.

Young of Old Scone, B.

NOT-CONTENTS

Abinger, L.

Lane, L.

Ackner, L. [Teller.]

Leigh, L.

Alton of Liverpool, L.

Liverpool, E.

Anelay of St. Johns, B.

Luke, L.

Annaly, L.

McConnell, L.

Attlee, E.

Mancroft, L.

Banbury of Southam, L.

Marlesford, L.

Beaumont of Whitley, L.

Massereene and Ferrard, V.

Belhaven and Stenton, L.

Miller of Hendon, B.

Bell, L.

Milverton, L.

Biffen, L.

Mountevans, L.

Blaker, L.

Morris, L.

Blatch, B.

Nelson, E.

Bridgeman, V.

Newall, L.

Brightman, L.

Norton, L.

Brougham and Vaux, L.

Norton of Louth, L.

Buckinghamshire, E.

Perry of Southwark, B.

Byford, B.

Plummer of St. Marylebone, L.

Cadman, L.

Rankeillour, L.

Campbell of Alloway, L.

Rennell, L.

Carnock, L.

Renton, L.

Clark of Kempston, L.

Roberts of Conwy, L.

Cope of Berkeley, L.

Rotherwick, L.

Cross, V.

Seccombe, B.

Denham, L.

Sempill, L.

Denton of Wakefield, B.

Shaw of Northstead, L.

Dixon-Smith, L.

Simon of Glaisdale, L.

Dudley, E.

Skelmersdale, L.

Feldman, L.

Stanley of Alderley, L.

Ferrers, E.

Sudeley, L.

Geddes, L.

Swinfen, L.

Gisborough, L.

Tebbit, L.

Halsbury, E.

Tenby, V.

Henley, L. [Teller.]

Teviot, L.

Higgins, L.

Thomas of Gresford, L.

Hooper, B.

Trenchard, V.

Howe, E.

Vivian, L.

Hutchinson of Lullington, L.

Weatherill, L.

Hylton-Foster, B.

Westbury, L.

Jenkin of Roding, L.

Wharton, B.

Kingsland, L.

Wilberforce, L.

Kitchener, E.

Willoughby de Broke, L.

Knutsford, V.

Wise, L.

Lamont of Lerwick, L.

Young, B.

Resolved in the negative, and Clause 31, as amended, disagreed to accordingly.
6.31 p.m.
Clause 32 [Employees of Legal Services Commission]:
[Amendment No. 241 not moved.]
The Lord Chancellor The Lord Chancellor moved Amendment No. 241A:
Page 19, line 32, leave out from beginning to ("they") in line 39 and insert ("the body which fall within subsection (2) shall not have effect in relation to him.
(2) Rules of a body fall within this subsection if they are—

(a) rules of conduct prohibiting or limiting the exercise of the right on behalf of members of the public by members of the body who are employees, or

(b) rules of any other description prohibiting or limiting the provision of legal services to members of the public by such members of the body.

and").
The noble and learned Lord said: Amendment No. 241A to Clause 32 is essentially a drafting amendment

1175
to correct an oversight in the current version of the clause. The clause provides that lawyers employed by the legal services commission may exercise their rights of audience or to conduct litigation on behalf of members of the public notwithstanding any professional rules that may otherwise prevent them from so doing. However, the clause fails to provide for advocates and litigators employed by the commission to be able to offer other legal services to the public. The short explanation is that lawyers do many things other than appear in court and conduct litigation; they give advice, attend interviews at police stations, draft documents and the like.
Lawyers employed by the legal services commission should be able to carry out these activities as necessary but at present they may be prevented by rules such as those in the Bar's code of conduct which permit employed barristers to offer legal services only to their employers and not to clients of their employers. The amendment will therefore ensure that such rules do not limit the provision of legal services by lawyers employed by the commission. I commend the amendment to the Committee.
On Question, amendment agreed to.
Clause 32, as amended, agreed to.
Clauses 33 and 34 agreed to.
[Amendment No. 242 not moved.]
Lord Kingsland Lord Kingsland moved Amendment No. 243:
After Clause 34, insert the following new clause—

LEGAL EXECUTIVES' PRACTICE CERTIFICATES
(" .—(1) A person who (whether expressly or by implication) describes himself as a legal executive is guilty of an offence unless he is a Fellow of the Institute of Legal Executives who has in force a current practice certificate issued by that Institute.
(2) A person guilty of an offence under this section shall be liable on summary conviction to a fine not exceeding level 4 on the standard scale.").
The noble Lord said: My new clause will ensure that a person can describe himself as a legal executive only if he is a fellow of the Institute of Legal Executives with a current practising certificate in force. It is important to ensure that consumers are not misled by self-descriptions of those who offer legal services. In recent years the term "legal executive" has come to bear the meaning of a fellow of the Institute of Legal Executives and to imply that the person concerned is subject to the qualification and regulation that that involves. It is appropriate, therefore, to ensure that the public is not misled by other, less well qualified individuals assuming the same title.
With this amendment is grouped Amendment No. 291, to which I shall briefly speak. Schedule 6 to the Bill amends the provisions of the Solicitors Act 1974 and the Courts and Legal Services Act 1990 in respect of rights of audience and rights to conduct litigation. The amendment proposed here to Section 63 of the Courts and Legal Services Act 1990, would extend to legal executives the professional privilege conferred on other authorised practitioners. It makes clear that communications made by or to legal executives, whether they are employed in solicitors' firms, departments or
1176
otherwise, are subject to the same rules of privilege as apply to communications made by or to other authorised practitioners. I beg to move.
Lord Clinton-Davis: When the noble Lord, Lord Kingsland, comes to make his observations on the response of my noble and learned friend the Lord Chancellor perhaps he will indicate what the institute of Legal Executives does to ensure high standards among its members. I am sure that my ignorance in this matter is my fault. What disciplinary code if any does that body have? How vigilant and disciplined is it in exercising any such code that may exist? This is critical in terms of the criteria relating to membership that the noble Lord demands.
Viscount Bledisloe: Perhaps the noble Lord can also deal with the following point. I understand that this amendment would prevent a person from describing himself as a non-practising legal executive. A solicitor who does not have a practising certificate can say that he is a non-practising solicitor. Can one say that one is a non-practising legal executive?
Lord Thomas of Gresford: The Institute of Legal Executives is an excellent body that does a great deal of work in training and ensuring the highest standards of those who work in solicitors' firms. There should be no suggestion, even in a question, that there is anything less than proper in the way that that institute carries out its work. I support this amendment.
Lord Clinton-Davis: I am sorry that the noble Lord implies that I am being unduly critical. I raise the question because I simply do not know the answer. Similar situations arose in relation to insurance brokers as a consequence of which the then government introduced the Insurance Brokers Registration Act, for which I was responsible. I genuinely want to know the situation. If an individual had been practising as a legal executive for a long period of time would he be required to undertake a course of whatever it might be in order to become a member of that body when that had not been imposed on him before? I believe that these factors should be weighed in the balance in deciding whether or not this is a good proposition.
Lord Kingsland: As I understand it, the structure of the institute and the way in which it manages itself, conducts examinations and investigates breaches of conduct are similar to the other two legal professions. I am not sufficiently knowledgeable about the way in which the system has worked over the past 20 years to say whether it has worked as well as the solicitors' profession or the Bar Council or otherwise. I am certainly prepared to provide the noble Lord with further information, but I cannot do that at the Dispatch Box now.
There is no doubt that a number of people who offer legal services and who describe themselves as legal executives have not taken the appropriate examinations

1177
and are not subject to the discipline of the institute. The amendment seeks to provide some quality assurance against that misrepresentation.
Lord Woolf: Perhaps I can assist noble Lords marginally on this subject. I must disclose that I am a vice-president of the body. Rights of audience were required as a result of a recommendation of ACLEC. It was considered and approved by the designated judges and followed as a consequence of that. I ask the noble Lord, Lord Clinton-Davis, to bear in mind that it is unlikely that that procedure would have been followed unless those different bodies were satisfied on the kind of matter that he raises.
Lord Clinton-Davis: I am sure that I shall have a flow of correspondence from the body, having made those intemperate remarks or raised those questions.
Lord Hacking: I am a little puzzled by the amendment. In the Courts and Legal Services Act 1990—the Bill does not propose to alter the section—Section 70 says:
"If any person does any act in the purported exercise of a right of audience, or right to conduct litigation, in relation to any proceedings or contemplated proceedings when he is not entitled to exercise that right he shall be guilty of an offence".
There is already protection for the public in the statute; namely, that any persons who have a right either of audience or to conduct litigation may do so.
We have the authorised body and the functions of the authorised body of the Institute of Legal Executives. If, for example, the Institute of Legal Executives gives a right to its junior members—those who have not become fellows—to appear in front of a master of the High Court or the like, it seems that nobody would be misled and that that would be entirely in order. I wonder whether the noble Lord who has tabled the amendment would address that point.
Lord Kingsland: I am not sure that I follow. Section 70 of which Act?
Lord Hacking: The Courts and Legal Services Act. That Act already makes it an offence to exercise a right of audience or a right to conduct litigation when you do not have that right.
Lord Kingsland: As I understand it, my amendment concerns misrepresentation of the title, and not an exercise of the right of audience. It is a misrepresentation of the title "legal executive".
Lord Hacking: What effect does that have?
Lord Kingsland: With great respect, I am not sure that I understand the noble Lord's question. If someone misrepresents himself as a legal executive, properly examined and accredited by the institute, he will be committing a criminal offence if the noble and learned Lord the Lord Chancellor accepts the amendment.
6.45 p.m.
The Lord Chancellor: The purpose of Amendment No. 243 is to protect the title of "legal executive". The effect will be that it is an offence for anyone who is not a fellow of the Institute of Legal Executives (ILEX) to describe himself, whether expressly or by implication, as a legal executive.
My response is that the offence which the amendment would create is unnecessary. If anyone uses the title of legal executive to imply that they have a right of audience as a fellow of ILEX or, in the future—and as proposed by the Bill—a right to conduct litigation as a fellow of ILEX, then that person could be found guilty of an offence under Section 70 of the Courts and Legal Services Act 1990. Section 70(1) provides that:
"If any person does any act in the purported exercise of a right of audience, or right to conduct litigation, in relation to any proceedings or contemplated proceedings when he is not entitled to exercise that right he shall be guilty of an offence."
It is an offence publishable on summary conviction by up to six months' imprisonment, and on indictment by up to two years' imprisonment.
Fellows of ILEX may also administer the oath, the institute having been prescribed for that purpose under Section 113 of the Courts and Legal Services Act 1990. It is an offence at common law to administer the oath without authority.
I agree with noble Lords to this extent. I, too, was very pleased when the Institute of Legal Executives finally became an authorised body for the purposes of granting rights of audience to its suitably qualified fellows, on 23rd April 1998. When the designated judges and I gave our approval to the application in October 1997, I wrote to the then president of the institute congratulating ILEX on being the first new body to be authorised under the 1990 Act to grant rights of audience. I said that:
"Fellows of the institute already play an important role in the legal process, and the success of this application will ensure an even greater contribution in the future."
But does it follow from that respect, that the title of legal executive should be protected in this way?
This amendment would make it a criminal offence for anyone to describe himself as a legal executive who is not a fellow of ILEX with a current practising certificate. That, I think, is going too far. The Institute of Legal Executives was formed in 1963 as the successor body to the Institute of Solicitors' Managing Clerks' Association. It has various classes of membership, of which fellowship is the most experienced, but out of a total of 23,000 members, only about 6,000 are fellows. The other 17,000 or so are members of the institute, and may now style themselves, quite properly, and regard themselves as "legal executives". This amendment would force them to change their title, or to be liable to a criminal charge. It is generally understood that the term "legal executive" is of sufficiently broad usage, perfectly properly, to cover those, particularly in solicitor's offices, who work in a legal capacity, but who do not derive their authority or status from statute, like solicitors, or from the common law, like barristers. So long as no one is being misled, I do no not believe that there is a problem.

1179
I consider that there is already sufficient protection for the restricted activities of fellows of the Institute of Legal Executives. I do not believe that an additional criminal offence of the kind proposed is necessary.
The purpose of the second amendment is to extend legal professional privilege to legal services provided by fellows of ILEX. However, it is questionable that it will have that effect. The Institute of Legal Executives is already an authorised body for the purposes of granting rights of audience to its suitably qualified fellows. Clause 34 provides that the institute should be authorised for the purposes of granting rights to conduct litigation to suitably qualified fellows, that is to say, once appropriate rules have been approved.
Legal professional privilege in respect of advocacy and litigation services provided by an authorised advocate or authorised litigator is already ensured by Section 63 of the 1990 Act. Section 63 applies to any communication to or by a person who is not a barrister or solicitor at any time when that person is for these purposes,
"providing advocacy or litigation services as an authorised advocate or authorised litigator".
Subsection (2) states:
"Any such communication shall in any legal proceedings be privileged from disclosure in like manner as if the person in question had at all material times been acting as his client's solicitor".
So any communication with a legal executive in his capacity as an authorised advocate or authorised litigator would be privileged from disclosure "in like manner" as if he were a solicitor. The nature of the solicitor's or a barrister's legal professional privilege is not defined in statute; it derives from common law.
The noble Lord, Lord Kingsland, has sought to add this new provision to Schedule 6 to the Bill. But that schedule deals only with rights of audience and rights to conduct litigation. As I have just explained, these are already covered by Section 63 of the 1990 Act. In any event, therefore, it appears to me that the amendment would not fit into Schedule 6.
I remain unclear, as I think do other noble Lords, what the amendment would mean and what it is intended to cover. If it is intended to cover anything other than advocacy and litigation, it must be the giving of legal advice. But I am satisfied that a court would say that privilege applied exactly as it would with a solicitor, so the amendment is almost certainly unnecessary. Apart from anything else it would seem odd indeed to give statutory protection to the legal professional privilege of legal executives alone while that of barristers and solicitors, and I believe of legal executives too, is protected at common law.
For those reasons I invite the noble Lord to withdraw the amendment.
Lord Kingsland: I am grateful to the noble and learned Lord for a full reply upon which I shall reflect. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 35 agreed to.
Schedule 5 [Authorised bodies: designation and regulations and rules]:
Lord Lloyd of Berwick Lord Lloyd of Berwick moved Amendment No. 244:
Page 63, line 10, at end insert—
("(2) Every person exercising functions in connection with that Schedule shall act compatibly with the principle that a strong, independent and self-regulating legal profession should be preserved."").
The noble and learned Lord said: I can be brief in moving the amendment because most of the ground was covered as long ago as the first day of Committee stage in respect of Amendment No. 1. On that occasion the noble and learned Lord the Lord Chancellor said, and has said on many occasions during Committee, that he was in favour of a strong, independent and self-regulating legal profession. I hope, therefore, that the amendment will prove completely uncontroversial.
On the previous occasion, the noble and learned Lord pointed out that while the amendment was an admirable statement of an admirable principle, it was not particularly relevant in the context of Part I of the Bill. On reflection, I respectfully agree with his view on that.
It is all the more important that it should be included in Part III of the Bill, especially in relation to Schedule 5 where it could be highly relevant in relation to, for example, the powers to be exercised in giving advice to the consultative panel, to paragraph 2 of the amended Schedule 4, and in many other places. That is why the amendment covers every person exercising functions in connection with the amended Schedule 4 and not just the Lord Chancellor.
The only objection to the amendment may be that it is so obvious that it does not need stating. However, as the Committee will remember, that was not the view of the Lord Chief Justice on Second Reading. History is full of examples, as we all know, of matters which seem obvious today but which somehow seem to be overlooked, forgotten or eroded by tomorrow. In the view of the Lord Chief Justice, with which I respectfully agree, certain fundamental principles should be stated on the face of the Bill; and this is one of them. Indeed, the substance of the amendment is taken from the very language which the Lord Chief Justice used at Second Reading. I hope that the amendment will be accepted. I beg to move.
The Lord Chancellor: I am grateful to the noble and learned Lord for moving the amendment. As I have often said, I believe—and believe passionately—in a strong, independent and self-regulating legal profession. The noble and learned Lord the Lord Chief Justice, Lord Bingham of Cornhill, in our Second Reading debate suggested that an amendment such as this, stating a general principle, would prove reassuring to some noble Lords. The noble and learned Lord, Lord Lloyd, moved a similar amendment to Part I of the Bill earlier in our proceedings in Committee.
I said then that I would consider whether a suitable amendment could be made to Clause 36 of the Bill, to emphasise the obligation which binds all advocates and litigators to act with proper independence. I continue to hope to be able to move such an amendment on Report.

1181
I am more hesitant about this particular amendment. It could not, for example, prevent a Lord Chancellor from ever exercising the power to call in and alter professional rules, subject to parliamentary approval, since that is an explicit statutory power conferred by the Bill. Any Lord Chancellor's exercise of that power would be reviewable by the courts. Therefore I do not see how the amendment would help a judge to decide such a case.
I should also point out that in exercising any functions under the provisions of Schedule 5 to the Bill or, more exactly, under the new Schedule 4 which it will insert into the Courts and Legal Services Act 1990, all those concerned are already subject to the statutory objective and the general principle set out in Section 17 of the 1990 Act which I have no doubt the noble and learned Lord, Lord Mackay of Clashfern, well recalls. The statutory objective is,
"the development of legal services in England and Wales (and in particular the development of advocacy, litigation, conveyancing and probate services) by making provision for new or better ways of providing such services and a wider choice of persons providing them, while maintaining the proper and efficient administration of justice".
The general principle is that the question of whether a person should be granted a right of audience, or be granted a right to conduct litigation, should be determined only by reference to four factors. Those are set out in Section 17(3) of the 1990 Act. They are whether he is qualified appropriately for the court or proceedings concerned; whether he belongs to a professional or other body with effective rules of conduct; whether, in the case of advocacy, those rules require an advocate not to withhold his services on the grounds that the nature of the case is objectionable, or that the conduct, opinions or beliefs of the prospective client are unacceptable, or because of the source of any financial support which may properly be given to the client; and, finally, whether the rules of conduct concerned are appropriate in the interests of the proper and efficient administration of justice.
On revisiting these provisions, they appear to me to be both well founded and comprehensive. I am committed to the maintenance of high standards that we have come to expect from our legal profession and the maintenance of the independence of the legal profession from improper pressures from whatever quarter, including, most particularly, the Executive. The powers given to the Lord Chancellor by the Bill are strictly circumscribed. I have made it absolutely plain that the more controversial of them are subject to parliamentary scrutiny and approval.
I hope that the noble and learned Lord, Lord Lloyd of Berwick, will be satisfied by those assurances and by the changes I propose to make on Report to Clause 36 and on that basis that he will agree to withdraw the amendment.
7 p.m.
Lord Donaldson of Lymington: I would have preferred to have spoken before the noble and learned
1182
Lord the Lord Chancellor, but he bounced to his feet with that joie de vivre for which he is so noted and I am not. Therefore, I rise to speak now.

I read in The Times on Monday that the noble and learned Lord the Lord Chancellor had defused a potential conflict with senior judges over the powers which the Bill would confer upon him. The basis of that happy forecast was a leak that he would give a fair wind in principle to an earlier amendment which reflects the wording of this amendment. He has taken it back to redraft and one cannot know what the tenor will be until we see it. However, I wish briefly to outline the basis for my continuing anxieties, whatever may be in the redraft.
I agree with the noble and learned Lord that any change in the general terms of the clause suggested by the amendment would have no effect whatever on the powers to force changes in the rules of the profession which are expressly dealt with elsewhere. However, I wish to take the Committee back to first principles. Our unwritten constitution provides for three branches of government: the legislative branch, which consists of the two Houses of Parliament; the executive branch, which consists of the Government of the day; and the judicial branch, which consists not only of the judges but also the members of the legal profession.
I say that because in the context of the administration of justice the solicitors expressly, and barristers and legal executives impliedly, are officers of the court who are as much involved in the administration of justice as are the judges themselves. Any changes in the qualifications of those three professions, or in the rules of professional conduct, have the potential for affecting that status as officers of the court. It may be improved; but its effectiveness may also be reduced.
The authority of the legislative branch is supreme. There is no problem about that. However, it is generally accepted that it is of cardinal constitutional importance that the powers of the three branches should be kept separate and distinct. That creates a problem for the Lord Chancellor who is not only a very senior member of the executive branch but is the titular head of the judicial branch.
At a press conference on 25th June, the noble and learned Lord the Lord Chancellor appeared to deny that the arrangements contained in Schedule 5 created any problem. He said that as, traditionally, questions as to the rights of audience have been for the judiciary, he saw nothing wrong in he himself, acting as head of the judiciary, deciding in consultation with the designated judges. Of course, the operative word is "consultation", which has a chameleon-like character, as we all know. Any transfer of power from the Lord Chancellor and the designated judges, that power being exercised jointly by the five of them, to the Lord Chancellor alone is, in my view, a major constitutional change.
In that context, we must never forget that some future holders of the office may bear little resemblance in their attitudes and actions to the present holder or his recent predecessors. It must be remembered that there are no formal qualifications for appointment to the office of Lord Chancellor. The appointee need have no judicial experience. He does not have to be even eligible for

1183
judicial appointment. He need have no legal knowledge whatever. Indeed, as regards formal qualifications, he could be the hereditary plumber of whom we heard a lot in a different context earlier in the Session.
What matters above all is that he does not have the independence of the rest of the judiciary, which is based upon political impartiality and security of tenure. By contrast, he is necessarily political, politically powerful, and holds office only for so long as he enjoys the Prime Minister's confidence. Let me stress again that I am not talking about the present Lord Chancellor. But any constitutional change must look to the future and to the extent to which there could be abuses of power.
No doubt it will be said that to some extent the Lord Chancellor's freedom of action will be restrained by the purpose clause in whatever form it may emerge. But, as I have said, I agree with the noble and learned Lord the Lord Chancellor that in this particular context of professional conduct and qualifications it would not operate. He says that there will be control by Parliament and by the courts. I agree that those are the only two candidates.
However, in the context of secondary legislation, which is what would be involved as regards Parliament, the powers of this House are somewhat limited. We must look to the future. We do not know what the powers of this House will be in, say, five years' time and in relation to such legislation. And the judiciary themselves would have considerable problems if a complaint were made to them about an abuse of power in this context by the Lord Chancellor. I say that because I assume that the challenge would come, possibly from the Bar Council or the Law Society, in the form of an application for judicial review. No doubt there would be a good deal of political steam in both directions and it would be impossible to get the great British public, or even the non-legal chattering classes, to understand that judicial review in this context was concerned solely with vires and not with the merits of the proposed change.
There would be an even further difficulty from the point of view of the courts—of course, they would try to get over it—in that it would be said, whether or not on behalf of the Lord Chancellor, by those who wished to uphold the Lord Chancellor's decision that the judges had already advised against it, as I assume would have been the case, and that therefore they were being judges in their own cause.
I accept that Schedule 4 in its procedural detail is clumsy, slow and far too wide-ranging. When I was Master of the Rolls I suggested, but not in detail, that there ought to be a fast-track procedure so that the more detailed changes to rules and so forth which did not involve public interest went straight through. I agree that there needs to be an extensive reforming, but major changes in the professional qualifications and rules of conduct should require not only the compliance of the Lord Chancellor but that of at least two of the designated judges. If the Lord Chancellor and two of the four designated judges agree, there is a majority. While I might disagree with the decision, I would accept it with content. But unless we keep that safeguard—we do
1184
not keep it because at the moment it requires unanimity, which I think probably is a mistake—and the situation in which the Lord Chancellor cannot make such changes without the concurrence of at least two of the designated judges, I believe that we are making a very dangerous change in the constitutional arrangements.
Lord Woolf: I am afraid it seems to be a failing not only of the Master of the Rolls who is still in office but also of those who have in the past been distinguished holders of the office that they do not jump to their feet as quickly as they should. In my case, I did not do so because having heard the wise words of my noble and learned friend Lord Lloyd of Berwick, I thought that there could be only one outcome, having regard to the history of this Committee when dealing with earlier provisions. I urge the noble and learned Lord the Lord Chancellor to reconsider his position in relation to the proposed amendment.
I recognise its limitations as pointed out by my noble and learned friend Lord Donaldson of Lymington as to what it would achieve. However, I suggest that it would be an important signpost. Today, when construing legislation, such signposts can be extremely effective, particularly in relation to applications for judicial review.
As in the case of my noble and learned friend Lord Donaldson, I too accept, and hope, that there will probably never be a time when reliance will have to be placed on that clause. However, fundamental changes of a significant nature are involved. I do not regard the present situation, having experienced it for a limited time, as satisfactory. There must he change. But I suggest, as did the noble and learned Lord the Lord Chief Justice, that a signpost as proposed by this amendment would be of value.
Lord Lloyd of Berwick: I thank the noble and learned Lord the Lord Chancellor for his response although I confess that I had hoped that he might, even at this stage, have been able to accept the broad principle which lies behind the amendment. It simply adds to, and does not provide a substitute for, the objectives already set out in Section 17 of the 1990 Act.
At present, the noble and learned Lord regards those objectives as comprehensive. I am not sure that I agree with him about that. Perhaps, between now and Report stage, he may reconsider that point. In any event, I look forward to receiving his fresh proposals. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
7.15 p.m.
Lord Kingsland Lord Kingsland moved Amendment No. 245:
Page 63, line 19, leave out from ("writing") to first ("to") in line 20 and insert—
("(a) for him").
The noble Lord said: This group of amendments seeks to replace the proposed powers of the Lord Chancellor to approve professional bodies for the grant of rights of audience and the amendments to professional bodies' rules with a requirement that the approval be granted

1185
by the Lord Chancellor and the four designated judges. However, rather than unanimity, it is proposed that a simple majority should be required for the approval of the designation and the amendments. The existing provisions provide only an advisory role for the judges.
This set of amendments deals only with amendments to Part I, II, and IV of the schedule. That is because a later amendment seeks to have Part III of the schedule removed altogether from the Bill. If the subsequent amendment is unsuccessful, then it would be appropriate for similar amendments to be made to Part III.
The codes of both professional bodies stress that both barristers and solicitors owe their primary duty to the court and impose duties of honesty and openness on the court. The Bar's code is a synthesis of judicial decisions and rulings of the profession on appropriate conduct. The code for solicitors mirrors it.
It must be appropriate for the most senior judges to have more than a mere advisory role in relation to the future form of those codes. When the proposals which led to the existing Schedule 4 to the Courts and Legal Services Act were being debated by this House, as I know the Committee is aware, great concern was expressed about the implications of a Cabinet Minister having the final decision on the rules of an independent profession.
The resulting compromise was probably over-complex and, indeed, resulted in long delays in approving rule changes. I suppose that some of those delays were inevitable in the context of very complex applications. Others were perhaps less explicable. It is probably true to say that none of the participants in the procedure has always acted as speedily as possible. So the proposals to speed up the procedure are very welcome.
However, the removal of any power from the judges is most unwelcome. It means that the judges will lose any final influence over the rules governing the conduct of advocates before them. We shall doubtless be told that the noble and learned Lord the Lord Chancellor will consult the judges in every case and will take their advice very seriously. But the fact remains that their advice is not binding.
Some of the difficulties with the existing system lie in the need to secure unanimity among the designated judges. That may well have proved to be too restrictive. But that is not a reason to write out the judges altogether. We believe that a majority decision is an appropriate approach.
In their Second Reading speeches, the noble and learned Lords the Lord Chief Justice and the Master of the Rolls indicated that they did not share these concerns and were content for the noble and learned Lord the Lord Chancellor to take those powers. They were also candid enough to indicate that their views were not shared by the overwhelming majority of their colleagues.
In my submission, the proposals fly in the face of the doctrine of the separation of powers which is a fundamental basis of our constitution. Parliament is the legislature; and the administration of justice is for the
1186
judges. The two should be kept quite separate. A statutory scheme in the 1990 Act ensured that the judges remained in control both of the exercise of rights of audience and of rights to conduct litigation in the courts.
The Government's proposals in the consultation paper, and in this Bill, mark a total change in the position. The judges would no longer be in a position to decide who could and in what circumstances exercise rights of audience and rights to conduct litigation. That power would be given solely to the Executive in the person of the noble and learned Lord the Lord Chancellor—as a Minister and not as a judge. The judges would be reduced to the role of former consultees whose advice could be ignored as the Executive might choose.
That is not acceptable on constitutional grounds. If the United Kingdom had a written constitution, the separation of powers would be enshrined in it, as it is in the constitution of the United States of America. To an American lawyer, it would be a matter of astonishment that the Executive might seek to arrogate to itself the sole power to decide who could speak in the courts or who could conduct litigation in them.
Therefore, we share the view of the majority of judges that it is dangerous for power, fettered only by a duty to consult and the very loose provisions applying to judicial review, to be placed in the hands of one government Minister, however distinguished, eminent and honourable the present holder of that office may be. I beg to move.
Lord Lloyd of Berwick: I rise to support the amendment. Much of what I intended to say has already been said by my noble and learned friend Lord Donaldson of Lymington in relation to the previous amendment. The key amendment in this group is Amendment No. 250. The question which that amendment raises is: who is to make the final decision? Is it to be the Lord Chancellor acting alone, possibly in the teeth of the advice which he has received from the consultative panel and the distinguished judges or is it to be a majority of the designated judges, including, for this purpose, the Lord Chancellor himself?
I have understood all along the need to replace ACLEC, which has been explained so patiently and so clearly by the noble and learned Lord the Lord Chancellor. I can see also that the process of reform should not be able to be held up by a single designated judge who may happen to disagree with some proposal for reform. That argument surely could not apply where the majority of the designated judges disagree with the proposal, still less where all the designated judges disagree with the proposal. At the moment—and I do not expect to be persuaded by the noble and learned Lord the Lord Chancellor on this but I may be—I can see no justification whatever for excluding the designated judges altogether from the decision and confining them to the role of being consulted or being entitled to be consulted.
One needs perhaps to remind oneself, although we all know, who these designated judges are. They are the Lord Chief Justice, the Master of the Rolls, the President

1187
of the Family Division and the Vice Chancellor. These are the judges who are in daily touch with the actual administration of justice in the courts. Of course the noble and learned Lord the Lord Chancellor consults widely, and indeed the history of this Bill shows just how widely he has consulted, but he does not have the same day-to-day experience of sitting and listening to cases in court. It is for that reason that these four designated judges should, in my opinion, be part of the actual decision and not simply confined to their role as persons to be consulted.
No doubt the noble and learned Lord the Lord Chancellor will say, as indeed he has said and would say, that he would be very slow to disagree with the unanimous view of the designated judges. But that does not really meet the point of principle that the decision should not be his alone. He may also say that his decision could be reviewed by way of judicial review but, as he knows better than anyone, judicial review is not a suitable instrument for arriving at this sort of decision. It is a blunt instrument not suitable for the fine tuning of decisions in this field.
"Fine tuning" is a phrase which is not my own. It is a phrase which is used in the response of the council of the Inns of Court to the Lord Chancellor's consultative paper. In paragraph 6 it says:
"We understand why it may be considered wrong that a single designated judge, however eminent, should have a power to veto changes to the grant of exercise of rights of audience approved by the Lord Chancellor and the other three designated judges, but we do not understand why it should be necessary to go to the opposite extreme".
That is what we are doing, going to the opposite extreme and relegating the judges to the role of consultees only. The council of the Inns of Court then referred to an opinion of Mr. Sydney Kentridge QC. Mr. Kentridge, in an opinion which again was forwarded to the noble and learned Lord the Lord Chancellor, says that the effect of these proposals is to bring about what he calls a constitutional revolution. Mr. Kentridge is not a man who wastes words. He chooses his words very carefully indeed.
Perhaps, for the benefit of the Committee, I may quote one sentence from Mr. Kentridge's opinion. He says,
"The persuasiveness of those reasons"—
that is to say, the reasons for extending rights of audience, which for my part I have no difficulty with—
"provides no ground for reducing the rights and powers of the judicial arm of the constitution and transferring them to the executive".
I do not overlook the fact that the noble and learned Lord the Lord Chancellor is in one sense the head of the judiciary, but in that role he has never previously had the powers which he now seeks to obtain, and the proposed new powers will be exercised in his ministerial capacity.
I am aware that the noble and learned Lord the Lord Chief Justice, in the Second Reading debate, did not see any great difficulty in reducing the role of the designated judges to that of consultees, to use that not very attractive word, but he did accept that in that respect he was not speaking for the majority of judges,
1188
many of whom he said—and the passage has already been quoted by the noble and learned Lord—felt strongly, even passionately, that this is a power which ought not to be given to the Lord Chancellor. I am no longer a judge, but if I were asked whether I felt passionately about this I would probably say no, not passionately; but I do feel very strongly about it.
Lord Donaldson of Lymington: I shall not repeat what I said earlier. I am passionately in favour of the amendment. I rise only because I thought that something that my noble and learned friend Lord Lloyd of Berwick said might mislead non-lawyers in the Chamber. He said that judicial review is not a suitable vehicle for fine-tuning ministerial decisions. That is not the distinction. The real distinction is that it is not a vehicle for considering the merits of decisions, and unless one can show on Wednesbury grounds, which is most unlikely, that the proposal of the successor Lord Chancellor—let me stress that—was so lunatic that it bordered on the irrational and therefore was ultra vires it is difficult to see what power the courts would have.
Lord Goodhart: I rise also to support this amendment, to which I have put my name. As has been pointed out, Parts I, II and IV of the new Schedule 4 cover the same ground as Parts I, II and III of the old schedule. Part I relates to the designation of authorised bodies, Part II to the approval of rule changes made by authorised bodies, and Part IV to the power to revoke designation of authorised bodies. The new Part III contains an entirely new power for the Lord Chancellor to impose rule changes on various bodies. That deserves an entirely separate debate because it raises the question whether that part should exist at all. That issue is raised by a separate and subsequent amendment which is not part of this group.
The most significant difference between the new schedule and the old schedule in relation to the three parts which appear in both of them is, as has been pointed out, that the veto of the designated judges is entirely removed even if they are unanimously opposed to the proposal of the Lord Chancellor. The purpose of the amendments in this group is to restore a modified judicial veto in Part I of Schedule 3. The subsequent parts are dealt with in subsequent groups of amendments. The 1990 Act was undoubtedly too rigid in allowing only one of the four designated judges to veto an application for designation as an authorised body. That is certainly now widely recognised. The amendments in this group modify that by requiring the Lord Chancellor to get only two judges on his side, not all four of them, in order to allow the proposal to go through. Why is a judicial veto needed at all? There are, after all, two other safeguards: first, judicial review; and, secondly, the need for an Order in Council by affirmative procedure in relation to Parts I and IV.
Judicial review, I believe, is not an adequate safeguard, for the reasons just pointed out by the noble and learned Lord, Lord Donaldson of Lymington. It requires judges to find that the Lord Chancellor has been acting irrationally; what is known in the trade as Wednesbury unreasonableness. As the noble and learned

1189
Lord pointed out, that is a very high border to surmount. Secondly, the affirmative procedure for Orders in Council is itself of limited value. A Government with a large majority in the other place can carry a vote there and in your Lordships' Chamber. The convention of not rejecting secondary legislation makes it difficult to resist any such Order in Council. It is possible that if a future Lord Chancellor introduced an order over the objection of all four of the designated judges, your Lordships' House might think that the constitutional significance of the Order in Council was sufficient to enable the House to override the convention. But that is unlikely and at best speculative.
There are major constitutional reasons why the modified judicial veto should be retained. The independence of the judiciary and the separation of powers is of the highest constitutional importance and is becoming rapidly more so because of the powers of the judiciary to decide devolution issues and issues that come under the Human Rights Act. Historically, of course, judges have always had control over rights of audience. Solicitors have been given rights of audience in the lower courts by various statutes. Rights of audience are now codified in the 1990 Act. Control over who has rights to conduct litigation and rights of audience is, to a considerable extent, control over the legal process itself.
The doctrine of the separation of powers as recognised in England and Wales does not lead to immunity from parliamentary legislation; but if the Lord Chancellor proposes to extend rights of audience and to litigate to members of new authorised bodies—that is the power under Part I—over the objection of three out of the four most senior judges, then only primary legislation will be the proper way to do that.
7.30 p.m.
Lord Clinton-Davis: With the greatest respect to the extraordinarily distinguished legal personalities who have spoken in this debate—I am certainly not one of them; I was a humble high street solicitor—too much is being made of this.
It is argued by my noble and learned friend that present procedures are too complex, too difficult and lead to unnecessary delay. I am persuaded that those points have not been taken into account sufficiently or at all by those who have argued in favour of this amendment. We have to be practical about this. It is not as though my noble and learned friend will go into the arena refusing to consult—it does not matter whether it is he or his successors—and acting in a totally arbitrary way. What has been the case in the past is that these procedures have been extremely arcane and we ought to avoid that situation in the future.
It was incumbent on those who sought to support the amendment to give some credit to the arguments set out in the Notes on Clauses, which I hope they read; I hope they are worthy of some mention. But unless I misheard the situation in the enthralling atmosphere affecting this debate, which imposes certain rest periods for some of us, I did not hear the arguments being adduced address those matters at all.
1190
The proposal made by my noble and learned friend is worthy of more profound consideration. Of course I shall listen carefully to what he has to say in response to this debate. I do not know whether or not he supports me; I suspect he might. At all events, while I listen with great care to legal luminaries who have spoken so far, I am not persuaded to support the amendment.
Lord Goodhart: Before the noble Lord sits down, since he raised the issue of increased complexity and delay, can he say why there should be any more complexity and delay in requiring the designated judges to consent to the proposal when under the new schedule the Lord Chancellor has to seek their advice?
Lord Clinton-Davis: While I understand that point, it does not fully address what I was saying. I shall listen to my noble and learned friend whom I am sure will offer some wise words on this issue.
Lord Hacking: There is another reason why my noble and learned friend should resist this amendment. He is answerable to Parliament. Whether it is primary or secondary legislation, he is still answerable to Parliament. It is for Parliament to decide such basic issues as the freedom to have rights of audience and whether or not a monopoly is exercised by certain bodies. This is a parliamentary matter; it is not simply a judicial matter.
The Lord Chancellor: These amendments would not restore the individual vetoes of each judge but would require the decisions to be taken jointly by them and the Lord Chancellor and, in the event of a difference of opinion, by a majority. That would mean that the Lord Chancellor could act only if at least two of the four judges agreed with him.
I want to start with a proposition of principle; that is, the principle that rights of audience in the Queen's courts are not ultimately to be decided upon by the designated judges or even by a majority of them, but by Parliament. The notion that it is appropriate for the judiciary, by any means, to be empowered to grant work licences to advocates is outmoded and out of place in a modern Britain. In our democracy the framework of rights of audience in Her Majesty's courts should be settled by Parliament, not the judges.
Much has been made of the proposition that on judicial review of the decision of a Lord Chancellor in this regard, the court would not substitute its view of the merits for that of the Lord Chancellor. That is correct of course unless the court was of the view, having regard to the objectives of the Bill, that the decision of the Lord Chancellor was irrational. But the merits of rights of audience issues are for Parliament where the real issue is whether what are prima facie restrictive practices are nonetheless justifiable in the public interest. What is justifiable in the public interest is for decision by Parliament, not by the judges.
Under the Bill's proposals the designated judges will retain a powerful role in advising me on the exercise of the powers in the new Schedule 4 to the 1990 Act. Judging by my experience thus far, it is in the highest degree unlikely that we will disagree about applications under the

1191
Act and it is by far the most probable that we would agree about all. But ultimately I agree with the noble and learned Lord the Lord Chief Justice—the most senior of the designated judges, whether or not he be in a minority so far of the judges as a whole—when he said at Second Reading,
"the final power of decision in these matters should rest with the Lord Chancellor. In the last analysis, it is he alone who is answerable to Parliament and to the public for the exercise of these powers".—[Official Report, 14/12/98; col. 1126.]

That was a point made by the noble Lord, Lord Hacking, but I have made it absolutely plain that under this Bill I would make any exercise of these powers by the Lord Chancellor subject to the approval of Parliament.
I am fortified in that view by the knowledge that my noble and learned friend the Master of the Rolls, who is in his place—the second most senior of the designated judges—also agrees with the noble and learned Lord the Lord Chief Justice. He made this quite clear at Second Reading when he said:
"it is part of the responsibility of the Lord Chancellor in our constitutional framework and he must take that responsibility".— [Official Report, 14/12/98; cols. 1153–1154.]
In my first Mansion House speech on 23rd July 1997, I said that I wanted to address, first,
"the separation of powers upon which our constitution rests; and what exactly that in my view entails for the relationship between Government and the judiciary".
I continued:
"It was widely perceived by the public that, under the last Government, relations between the higher judiciary and the Government had sunk to an all time low.
The public know, or sense, what the separation of powers is about. They are unhappy if the Government are attacking the judiciary and if the judiciary seem to be hitting back in return. They then feel that all is not well with the state of the nation. I am clear that the Lord Chancellor is at a critical cusp in the separation of powers. I personally regard it as of the first importance that the judges' views whether proposed changes by the Government to the law will work, or any views the judiciary may have of damage they, the judiciary, apprehend to the system from legislative proposals that the Government are minded to bring forward, should be able to be made known effectively to government at a stage when policy is still being formulated and not settled.
It is essential that Government be able to speak to the judiciary and the judiciary to Government. I regard the Lord Chancellor as the primary medium for that interchange".
I believe that that would be the credo of any Lord Chancellor.
Those of your Lordships who are concerned that a Lord Chancellor might wield his powers in an attempt to damage the freedom and independence of the legal profession should bear in mind that he would be able to exercise his power to alter the rules of an authorised body, or to revoke the designation of an authorised body, only with the express sanction of both Houses of Parliament. Ultimately, it is Parliament that is the guardian of our liberties—and without Parliament, we are all lost.
Parliament will be well placed to fulfil this role in relation to Part I of the schedule, as no Order in Council may be made in this regard unless approved by both Houses. I trust, therefore, that noble Lords who have proposed the amendment will agree to withdraw it.
Lord Lloyd of Berwick: Before the noble and learned Lord sits down, is he willing to undertake that in a case
1192
where, however unlikely, he finds himself rejecting the advice of the designated judges, he would either publish the effect or substance of that advice or at least let the world know that that is what he is doing?
The Lord Chancellor: I would certainly always ensure—indeed, there is provision in the Bill in that regard—that the advice which I did not accept was published and that my reasons for not accepting that advice were published.
Lord Donaldson of Lymington: I believe that the Lord Chancellor may be mistaken when he says that there is provision for the judges' advice to be published. We corresponded on this matter a few weeks ago. When I asked why there was no power for the judges to publish their advice, the answer that I received from the Lord Chancellor, which I entirely accepted, was that they had inherent power to publish their advice and, although he did not put it quite in these terms, if they disagreed sufficiently, no power on earth would stop them publishing.
7.45 p.m.
Lord Goodhart: I heard with great interest what the noble and learned Lord the Lord Chancellor said. However, he emphasised the right of Parliament to alter the rules of rights of audience; there is no question about that. That is something that Parliament has done many times, starting, I think, in the last century and most recently in 1990. The question surely is: how should that power be exercised? Is it adequate that that power can be exercised by secondary legislation? I am suggesting no challenge whatever to the right of Parliament to alter by primary legislation the rules of rights of audience. That is the question that has to be decided here.
The Lord Chancellor: I have made it perfectly plain that I regard the affirmative resolution procedure as adequate.
Lord Kingsland: I disagree with the noble and learned Lord the Lord Chancellor about the basis upon which he has promoted this part of the Bill. Democracy is a necessary, but not a sufficient, condition to guarantee freedom in our country. It is not just Parliament approving laws; it is judges interpreting the exercise of the laws and, where necessary, constraining the Executive in implementing the laws—equally an essential component of freedom. It is the operation of those two factors, freely side by side, which makes for a free society. After all, the doctrine of the sovereignty of Parliament is a doctrine of the courts.
I shall reflect on what the noble and learned Lord has said. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Farrington of Ribbleton: I beg to move that the House be resumed. In moving this Motion, I suggest that the Committee stage begin again not before 8.45 p.m.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Tax Harmonisation
7.46 p.m.
Lord Willoughby de Broke Lord Willoughby de Broke rose to ask Her Majesty's Government whether they support current proposals for tax harmonisation in the European Union.
The noble Lord said: My Lords, I thank noble Lords who have taken the trouble to put down their names to speak to this Unstarred Question. I say that now because I understand that I shall not have the opportunity to thank them later. I am grateful to them for being here and I am sorry that they will have only three minutes in which to speak, according to the instructions which I have been given. Whatever one's view on tax harmonisation, that is a shame. After all, it is an interesting subject despite the unpromising number of COM(97)564 FINAL.
The hare that started running in this case was more interestingly entitled A package to tackle harmful tax competition in the European Union. That in itself is an interesting concept. "Harmful tax competition"; harmful to whom? Who defines what is "harmful"? As a starting point, perhaps the Government would like to define what they see as harmful tax competition. What was that "package" and what are the consequences?
The first element was a code of conduct for business taxation. The second part comprised measures to eliminate withholding taxes and interest and royalty payments between companies. The third part was to make progress in the area of taxation of capital from income.
The code of conduct to which I referred requests member states to adopt certain principles; for example, not to engage in harmful tax competition. It allows member states to discuss the tax levels of other member states and to evaluate whether they are harmful. It also covers business tax measures which affect, or could affect, the location of business activity in the Community. Member states can still be asked to amend taxes,
"with a view to eliminating harmful measures".
Incidentally, the code also brackets together in Section M tax evasion and tax avoidance. It states:
"The Council stresses its commitment to full co-operation in the fight against tax evasion and avoidance".
Those are still two very separate matters in this country, but they seem to be equally treated as criminal in the code. The Government's Explanatory Memorandum states:
"as the Code of Conduct would not be legally binding, it would have no direct impact on UK law. However the Government would only agree to the Code of Conduct if it intended to honour it".
1194
To me, the code looks like a device for side-stepping the various EU treaties which require unanimity in respect of tax harmonisation. By signing up to it, the Government have at the very least limited their room for manoeuvre. After all, once the principle is conceded and other countries may have some kind of say in our tax matters, where do you stop in practice?
Further on in the memorandum the Government go on to say how,
"pleased it is that the Code of Conduct recognises the positive effects of fair tax competition. This means that the U.K. rates of Corporation tax could not be questioned under the Code".
How wonderfully optimistic that sounded even in late 1997 and how naïve it sounds now in the light of the events of the past couple of months when European Finance Ministers have repeated and underlined their insistence that EU tax harmonisation, including corporate taxes, would be high on their list of policy priorities. This stance was supported by the German Chancellor and echoed as French policy by M. Strauss-Kahn. the French Finance Minister.
Where does all this leave the Government and, more importantly, Britain's interests? The Government's first reaction was to pretend that tax harmonisation was not on the menu at all; then, when their cover was blown on that, to say that Mr. Lafontaine's opinion on tax harmonisation did not represent official German policy. When they were smoked out of that position by the German and French Governments confirming that tax harmonisation was indeed their official government policy, the Prime Minister went on to pretend that tax harmonisation plans were supported by only a minority of member states. But that is not the case. It is clear that the Commission paper to which I referred earlier reflected majority opinion; it would not otherwise have been put forward.
Of course, the Economic Monetary Affairs Committee of the European Parliament has several times called for harmonisation of EU business taxes, with the leader of the Parliament, Jean-Claude Juncker, saying in 1997 that he expected this to take place within two years. The Chancellor of the Exchequer was thus forced back into a previously unprepared position—the threat to use the veto—and this from a government who still say they are winning the argument in Europe. That will be news to the London art market. But, sadly, even that position was booby trapped. The French and German Governments confirmed their belief that the principle of unanimity should be abolished with Finland helpfully chipping in to announce that it would make scrapping the veto a central plank of its EU presidency beginning in July this year.
However, according to a report in last Sunday's Independent, it now seems that the veto policy, which was made such a play of by the Prime Minister and the Chancellor of the Exchequer, has been abandoned. The report quotes a Whitehall source as saying:
"Ministers do not think this is veto territory".
This decision was apparently taken at a meeting of the Cabinet Committee on Europe last Thursday.
On the Wednesday of that week, at the conclusion of the debate in this House on the introduction of the euro, the noble Lord, Lord McIntosh, while winding up for the Government, stated in reply to a question on tax harmonisation from the noble Lord, Lord Shore:
"If we think it is unfair we shall veto it and it will not happen. It is as simple as that".—[Official Report, 20/1/99; col. 662.]
Would the Minister please clarify the Government's position? It would be helpful for business and for individuals to know whether the Government are preparing a climb down and, if so, how far they are going to climb down.
Perhaps I may just remind your Lordships that the UK has lower rates of tax, both personal and corporate, than all other members of the EU. For example, basic rate tax here is 23 per cent. against 38 per cent. in Germany; high rate tax is 40 per cent. here, as against 57 per cent. in France; and, corporation tax is 30 per cent. here, as against 43 per cent. in Italy and 64 per cent. in Germany. United Kingdom taxation is 33 per cent. of its gross domestic product, as against well over 40 per cent. of GDP in other European Union countries.
It is this comparatively light tax regime—and I use the word "comparatively", because I believe the tax man already gets a great deal more of our money than is good for him—which contributes significantly to Britain's position as the most favoured home in the EU for inward investment. Britain's share of this investment actually stands at about 34 per cent. In comparison, Germany attracts about 20 per cent. and France and Spain about 10 per cent. each—this despite the fact that inward investors were fully aware that Britain was not going to join the euro in the first wave. That only goes to disprove the repeated claims by our euro enthusiast friends that Britain will be "marginalised" by not joining the euro. On the contrary, it appears that foreign corporations are happy to invest in a free market economy with relatively benign tax rates and relatively low non-wage costs.
Significantly in Europe it appears to be low or zero taxes that are considered harmful and not high tax rates. I hope that the Government will draw strength from a report published in November of last year by the European Policy Forum entitled, Is Tax Competition Harmful?. It was written by Mr. Keith Marsden, a former World Bank economist. The report examines the taxes and growth rates from 20 economies and concludes:
"The empirical evidence is clear. Tax competition is not harmful … Lower taxes were associated with higher rates of growth, of investment, employment, productivity and private consumption. Countries that chose big government, and more public services financed by higher taxes, experienced slower economic growth".
When the Minister comes to reply, could he please tell the House whether he believes that harmonisation, which is so firmly on the EU agenda, will harmonise our taxes upwards to our competitors' levels or downwards to our own current levels?
The Government, as their successive defensive positions have been overrun, have fallen back on assuring us that on matters of tax the principle of unanimity is "sacrosanct"—I think that that was the
1196
Prime Minister's word. But even if the Government have not now abandoned the "V" word and we are still in fact in "veto country", it appears that single market legislation, which requires only a qualified majority not unanimity, can be used to deal with tax matters. It appears that if varying tax levels within the EU are deemed to obstruct its further development, the European Court of Justice can apply single market law. Perhaps the Minister may care to comment in that respect.
Finally, will the Minister bring the House up to date with the position on eurobonds and on the proposed withholding tax? The eurobond market in London has grown from nothing to be the largest source of such funds in the world. It is a huge advantage to London, but it could easily be lost. Other financial centres do very little of this kind of business, so we would have nothing to lose by implementing the proposed directive. If the tax damages London—and even if the EU as a whole loses business—anything to weaken London's dominance would be seen as a plus by its rivals, notably in Frankfurt.
Therefore, could the Minister inform the House what the Government's intentions are, so that if the eurobond market does have to leave London for Geneva, Zurich or New York, it can at least switch out the lights before it goes? Are we still in veto country, or is a deal being cut to obtain some kind of temporary derogation? If that is the case, what is the price tag? British firms, British consumers and British taxpayers will rightly expect the Government to continue to defend Britain's interests and to maintain our competitive advantage. I hope that the Minister will be able to confirm this evening that they will do exactly that.
7.57 p.m.
Lord Desai: My Lords, I should begin by informing the House that the Select Committee of your Lordships' House on the European Communities brought out a report on taxation and competition policy in the single market last June. I am a member of Sub-Committee A which is occupied with the latter, and we intend to take up the question of taxation and harmonisation very soon. That will at least shed some light on the matter after a lot of heat.
I should say, first, that we ought to consider this question from the point of view of a single market rather than concentrating on the issue of federalism. If you have a single market it is worth considering, as a general principle, which taxes ought to be harmonised and which should not. For example, we know that the differential taxation of beer and spirits harms many businesses in the United Kingdom very adversely because people can go across to Calais and buy such things much more cheaply. Indeed, we have had many complaints in your Lordships' House from people who point out that it is unfair.
Moreover, we also know that between Northern Ireland and the Republic corporation tax is very different—30 per cent. in one and 10 per cent. in the other. That is very unfair competition for Northern Ireland, as has been pointed out in this House. It is not

1197
as if we are the lowest tax territory in the whole world and everyone else has higher taxes. The UK has suffered from unfair tax competition but it has also gained from it.
We ought to establish a few principles with regard to these matters. If we want to have a single market, taxation of certain tradeable goods ought to be, if not equalised, at least co-ordinated, because otherwise it will not be advantageous within a single market to have differential taxation. The Commission has come up with a proposal for VAT harmonisation. I know that we have differential VAT rates if one takes into account zero rating, but eventually, if we do not harmonise VAT, that will create anomalies and the advantage of the single market will be lost.
We should open our minds to thinking about a radical reform of taxation, perhaps moving away from taxation on capital and labour altogether and towards taxation of resources and consumption. Consumption taxation can be co-ordinated across the single market without doing harm to anyone. We should take a radical approach to taxation rather than insist that what we have is best.
8 p.m.
Baroness Ludford: My Lords, rather like the noble Lord, Lord Desai, I believe that we should approach tax harmonisation in the European Union in the same way as we approach fiscal policy domestically; that is, pragmatically, weighing up the pros and cons. This should not be an ideological issue on which Europhiles all take one view and Eurosceptics another. As a pro-European I do not jump like Pavlov's dog at the prospect of tax uniformity. We need to take a cool and not hot-headed look at what is really essential to the single market, what is good for Britain and Europe and what is good for competition and jobs in particular sectors; for example, financial services in the City.
Let us remember that harmonisation does not have to mean sameness. Harmony in music is the blending of different sounds, the opposite of discordance. The Oxford Dictionary defines harmony as,
"the combination or adaptation of parts … so as to form an orderly whole";
co-ordination, in other words.
It clearly makes sense to avoid or eliminate tax distortions, evasions and havens as much as possible on grounds of promoting a competitive market and stopping the excessive loss of tax revenue. Surely there can be no ideological objection in principle to that. If co-operation between tax authorities can tackle fraud, so much the better. If there could be some achievement of consistency in the definition of the tax base in the different member states—for example on corporate taxation—that could cut business costs by saving on accounting administration. If European tax harmonisation means that News International pays rather more than 7 per cent. tax on its worldwide profits, that would be welcome.
But what must be kept uppermost is the need to safeguard the competitiveness of the European Union and its member states at a time when they have all
1198
rightly put jobs at the top of the list of priorities. There will be a need, with a single currency and a single monetary policy, to retain flexibility in fiscal policy and the setting of tax rates. Let us make clear that there is no suggestion of harmonising income tax.
We must also be sure not to score a British or European own goal. There is some risk of this in the field of taxation of capital and savings. Some 10 years ago the Commission proposed a single common system of withholding tax on interest income. That has sensibly been withdrawn and the current proposal, the so-called "co-existence model", allows member states to choose either to apply a withholding tax or to provide information on income from savings to other member states.
Certainly the City is right to fear that the imposition of withholding tax in the eurobond market could drive that business away, and not to Frankfurt or Paris but out of Europe and offshore. Therefore Europe as a whole would be hurt. Only international co-operation on such taxation, for instance in the OECD, could prevent this disadvantage to the European Union. Even if a withholding tax was applied, that would leave the host member state with the tax receipts, not the member state of residence. Therefore it is insufficient on its own to solve the problem of Germans escaping German tax by putting their savings in Luxembourg.
The Government should therefore continue to oppose the withholding tax for the sake of jobs in the City, jobs in London and jobs in Europe. On the other hand we should support an energy carbon tax throughout Europe. We should be keen on tax co-operation in co-ordinating tax bases, exchanging information and pursuing tax evaders and fraudsters. For eurobonds especially, international agreement must precede a European scheme.
8.4 p.m.
Lord Harris of High Cross: My Lords, all countries have their own distinctive tax regimes. Each country develops a mixture of direct and indirect taxes shaped by history, political principles, expediency, electioneering and similar influences. For a free market economist most taxes are either distortionary or debilitating. The one common characteristic of all national treasuries is their insatiable appetite for revenue. On this rapacious approach there are two checks. The first is taxpayer rebellion through avoidance, evasion and emigration. The second is national economic damage as measured objectively by the effects of the Chancellor's depredations on the efficiency of a national economy as compared with competing national economies.
Competition was defined by the Nobel Laureate, Friedrich Hayek, as "the optimum discovery procedure." The Olympic Games are a classic model of competition. They enable us to discover the minimum time, the highest jump, the fastest swim, the longest throw and so on. We rule out artificial aids such as drugs, but we do not ban athletes employing rival techniques or training programmes to suit their taste. Competition works to test these elements and brings out the best system and

1199
encourages all performers to approach the best. In other words, under competition there is a natural drive towards harmonisation, as is exactly the case with free trade. If we rule out subsidies and tariffs, competition between economies embraces competition between rival labour markets, rival tax jurisdictions, rival educational systems, rival management techniques and other national policies. We can learn from the success of others, but we cannot lame them or deprive them of their advantages.
In the single market of the United States, 51 states compete with different sales taxes, income taxes, property taxes, even tobacco taxes. But we should mark the following well. Because high taxes would drive business elsewhere, taxes are kept low and differences between the various states are also quite narrow. Tax harmonisation through market pressures pushes rates down. Tax harmonisation through political pressures pushes taxes up. If the EU were to succeed in raising the general level of taxes and enforcing a withholding tax throughout Europe, it would weaken all European economies and would drive mobile capital and enterprise beyond their doomed jurisdiction. Such is the discovery procedure of free competition in the glorious global market.
The Franco-German summit in December called for rapid progress on tax harmonisation. Why will British Ministers not declare their opposition with equal candour and confidence? I ask plainly: will the Government use their veto to block these malignant Franco-German mischiefs of withholding tax and tax uniformity? To prove their European credentials, the Government tend to take abject refuge in weasel words, evasion and deceit about continued endless negotiation. How about the noble Lord coming clean tonight?
8.8 p.m.
Viscount Trenchard: My Lords, I am grateful to my noble friend Lord Willoughby de Broke for raising this subject today.
The analysis prepared by the London Investment Banking Association and mentioned in its submission to the Council of Ministers last September suggests that the proposals for an EU-wide withholding tax are unlikely to be more than marginally successful, because capital movements are fully liberalised. To the contrary, implementation of the proposals, unless all other OECD countries decide to adopt similar measures at the same time, would introduce incentives to divert business to other financial centres outside the EU, causing great damage to the City of London.
As Mr Howard Flight pointed out so clearly in his letter to the Financial Times on 23rd December, what is at peril is London's entire position as the world's main banking capital, not merely as the home of the hugely successful and important eurobond market. I cannot stress too strongly how great is the danger that is faced by the City. If bank deposits move to Hong Kong or New York, so will the related foreign exchange and derivatives business. The threat to employment is therefore at least 100,000 jobs. I, too, ask the Government to make it absolutely clear whether or not they will veto this proposed directive. Will the Minister
1200
state whether he has changed his view since the Answer he gave to my noble friend Lord Pearson of Rannoch on 5th October?
The second major area of concern that I wish to raise is that the establishment of the European single currency is leading inexorably towards harmonisation of taxes in general. Britain has the lowest rates of income tax in the EU and its corporation tax rates are also among the lowest. But Mr. Lafontaine has said that we must drive forward tax harmonisation in Europe. Mr. Tietmeyer has said that it is an illusion to think that EU states can hold onto their autonomy over taxation policies. The EU's Code of Conduct Group on business taxation has reportedly identified a list of unfair taxes which need to be addressed. Unfair to whom? Do France and Germany think that it is unfair that our low rates of corporation tax and low employment related add-on costs have helped to secure for the United Kingdom by far the largest slice of Japanese direct investment in Europe?
It will be very unfair to the British people if the Government throw away the hard won right of the House of Commons to determine tax rates in this country. I do not want to argue that tax harmonisation is inherently always bad. Clearly, in formulating our economic and fiscal policies in the global economy that exists we need to have regard to those of all our major trading and investment partners—not merely other EU countries, but the United States, Japan and others as well.
However, paramount must be the need to apply fiscal policies that best serve the needs of the British economy and preserve the beneficial tax environment in which the best parts of it—notably the City of London and the financial services industry—can thrive. I look forward to hearing the comments of other noble Lords, including my noble friend Lord Hindlip, who I believe will tell your Lordships about the similar and serious threat faced by the London art market. I hope that in the course of his reply the Minister will tell the House whether he agrees with the German Chancellor and the French Finance Minister, both of whom have recently said that EU rules should be changed to allow majority voting on tax matters.
8.12 p.m.
Lord Stoddart of Swindon: My Lords, perhaps I may follow the noble Viscount, Lord Trenchard, in referring to the democratic issue; namely, the power of the House of Commons to control supply. If we examine the Answer given by my noble friend Lord McIntosh to the noble Lord, Lord Tebbit, on 2nd November, there is no doubt that the rights of the House of Commons may well be at risk. His reply made the matter absolutely clear. He said that,
"If a directive is unanimously adopted by the Council of Ministers"
—that is, if Britain failed to use the veto—
"all member states are obliged to implement it".—[Official Report, 2/11/98; col. WA 28.]
by a due date. Indeed, if the directive was not implemented by Parliament, Parliament would be breaking the law and could be fined. That is the position. Our sovereign Parliament would be breaking European law and could have to find the money to pay the fine.

1201
I hope that my noble friend will confirm what I have said; or, if he does not, tell me why I am wrong. This is a fundamental democratic issue. The House of Commons gained its pre-eminence and sovereign power because it gained control over supply. Once it loses control over supply, Parliament will have lost its power, and the executive, whether it be the British or European executive, will have won, and we shall have returned to a situation similar to that under Charles I.
My second point has already been raised. It is the question of confusion. This week, there have been two reports on this matter in the press. One appeared in the Daily Mail on Monday and was headed:
"Labour to surrender EU tax veto".
The article states:
"Ministers have abandoned their key weapon in the battle against common taxes in the EU.
"They have decided they will not use Britain's national veto to block German-led attempts to harmonise tax rates".
That frightened me.
Yesterday, I read in the Daily Telegraph the headline:
"Hewitt pledges UK veto over withholding tax".
Then, although I was slightly encouraged, I became confused—as are many other people, because they do not know what is government policy. This evening we should be told the answer. I hope that the Government will be absolutely firm and will say that they will use the veto on every occasion when our taxes are under threat from a European directive.
8.15 p.m.
Lord Hindlip: My Lords, I must declare an interest in this Question. My livelihood as a director of Christie's, and that of 40,000 other people employed in the British art market, is put at risk by the harmonisation of VAT on the import of works of art into the Community and by the imposition of droit de suite. In the brief time available, I wish to begin by thanking the Government for what they have already tried to do for the art trade. All of us who are involved in it are grateful to the Department of Trade and Industry, although I fear that the department under-estimates—by 5,000—the loss of jobs that harmonisation will bring.
We in the art trade must thank the Prime Minister himself. He has actively lobbied on our behalf and has written to the president of the British Art Market Federation, personally pledging his support. While the Prime Minister's lobbying has been vigorously and sincerely carried out, will it have any effect? Are the French or the Germans listening? It is sad if they are not, because the British art market is second in size only to that of New York, and second to none in its reputation for expertise and integrity. It is by far the largest European market; it is the only European market which can compete with America. The loss of business and loss of jobs as a result of harmonisation can only benefit New York. I point out to the noble Lord, Lord Desai, that it is not just a question of a single market; it is a world market. The single market to which he refers is only a small part of that world market.
1202
This tax increase will decrease revenue, because there will be so much less to tax. Furthermore, is it really harmonisation? As the Minister knows, all the various other countries in the EU have differing rates of VAT. They are not being persuaded to reduce them to our level—we are just being forced to raise taxes nearer to their levels.
I remind the noble Lord, Lord McIntosh—whom I thank for his endless courtesy on this matter—of the Answer he gave to my noble friend Lord Pearson of Rannoch. I refer to the Answer already mentioned, on 5th October. He said:
"we are firmly committed to preserving the competitiveness of European Community financial markets".—[Official Report, 5/10/98; col. 162.]
The art market is a financial market as well as a cultural one.
The noble Lord went on to say that there had still not been a cost/benefit analysis on the effects of harmonisation. I believe that that is still the case; perhaps the noble Lord will confirm that. We must have such an analysis. If, as I am sure it will, it bears out what all of us in the art trade believe, the Government must do everything possible including using the veto, not only to protect British interests but European interests as well.
If they do not, London as a commercial centre will suffer. Perhaps I may leave your Lordships with two thoughts. The first is that, out of the 100 offices where Christie's does business, the one in London is still the best and the most profitable. Secondly, this harmonisation is the triumph of the absurd. It seeks to raise taxes in order not to collect them. Worse than killing the goose that lays the golden eggs, it drives the goose into the rival's garden. Even a Brussels commissioner should understand the stupidity of that. In opposing this harmonisation and droit de suite, the Government will help London, help Britain and help Europe.
8.19 p.m.
Lord Shore of Stepney: My Lords, we are all indebted to the noble Lord, Lord Willoughby de Broke, for giving us the opportunity—however brief—to canter over the course in this important aspect of our relationships with Europe. In a sense, it follows logically that having got a single currency, an economic union and a monetary union, the European Commission should now begin to think about a fiscal union. It is no accident that taxation and harmonisation of taxation should appear as soon as victory has been finally won on the economic and monetary union and the single currency front.
Of course, we are faced with a major challenge and great British interests are at risk. I can only touch on one or two. Current proposals for tax harmonisation are important. Some have been listed, but I remind the House that there were five different tax matters on the agenda of the Vienna summit. On a withholding tax, we are in great danger. We are isolated. It is a British interest and we will have to fight hard to defend our interests, either by avoiding a compromise—which is

1203
simply a disguised surrender—or taking the unpopular course of using a veto and not being at the heart of Europe when we do so.
The other taxes are the energy tax—not mentioned but on the agenda—VAT, corporation tax, and the whole vast area of unfair tax competition. And as we know who chaired the study: Dawn Primarolo, the Paymaster General, in the other place.
I am worried, first, because the Government's reactions up to now have been complacent; secondly, because what has been said is ambiguous and unclear. They signed up to the presidency statement at the end of the Vienna summit. In the presidency statement they agreed to the following vague propositions: the need to control harmful tax competition; the need to reduce the continuing distortion in the single market; and the need to prevent excessive loss of tax revenues.
That opens up a vast area of debate and covers virtually all the range of taxation. Our colleagues in Europe have significantly higher tax rates than we have. Of course, they think it is unfair that we have that advantage. They would like to remove unfairness, and that is built into the treaty. Article 3(a) demands that in the internal market we should not have the distortion of competition. There should be a level playing field. My noble friend who relies heavily on the veto might well consider that among other dangers someone might take us before the European Court of Justice on the charge of the infraction of the basic treaties.
8.23 p.m.
The Earl of Clanwilliam: My Lords, I take part in the debate in order to draw attention to the possible confusion of provisions that will have to be made to cover the pension liabilities of other European states and to speculate on the possibility that harmonisation, especially of corporation tax, might be the backdoor route to involving the United Kingdom in their difficulties.
I have spoken previously on the subject in debate and in Starred Questions to the Government. Much water has flowed under the bridge since then. I was assured by the noble Lord, Lord McIntosh, that under Article 140b we would not be required to "bail out"—that was the noble Lord's expression—other member states' pension shortfalls.
The euphoria that followed the launch of the euro has led some leaders such as Herr Lafontaine, and many others already mentioned, to proclaim the arrival of the era of the federal state of Euroland for which harmonisation of tax rates is a pre-requisite.
We can recall that the social chapter was brought in under the health and safety regulations, with the connivance of the European Court of Justice. I ask the Minister: are we sure that Article 140b will not be equally outflanked? It is not a matter of some minor financial adjustment, nor even a canard, as the noble Lord, Lord Taverne, referred to it on a previous occasion. It is a real and large debt that is accruing. We know the cost to our companies who run occupational pension schemes is in the order of 6 per cent. of their profits which relates to some 12 to 16 per cent. of
1204
payroll costs. Any form of harmonisation will lead to an increase in our taxes to prevent what our neighbours regard as unfair competition. We should be in no doubt that it is our own diligence and forethought that has left us in the fortunate position of having some £850 billion stashed away in trust funds to pay at least part of the demographic bill that awaits us all. Let there be no mistake, this additional charge will compound the problems of those Euroland members who have fudged their way into convergence.
Now there is another plot to eliminate UK competitiveness with the withholding tax at an extortionate rate of 20 per cent. It is designed to damage the City of London and attack its "unfair" position as the leading centre of finance houses in Europe. It seems to be a case where they are cutting off our nose in order to spite their face. It is clear that the tax will drive business away from Euroland to Switzerland, the United States and the Far East.
Meanwhile, the droit de suite is being proposed by QMV. We are told that Her Majesty's Government are fighting it tooth and nail. Can the Minister enlighten us? Is he willing? It is not so much the effect of the euro on our economy that concerns me at the moment. It is the effect the euro has on our partners' aims and ambitions towards ever greater union and ever greater pressure on the UK to compromise its position in world affairs which concerns me.
8.27 p.m.
Lord Taverne: My Lords, as the noble Lord, Lord Desai, pointed out, there is a case within a single market for some harmonisation of taxes in some fields. It makes sense to have the same general system of value added tax within a broad range of rates. We would gain from some upward harmonisation of excise duties. It makes sense if we have taxes on the environment, but they should be European Union-wide. As I mentioned the other day, an energy tax could lead to a reduction of employers' taxes, increased GDP and more jobs.
It would make sense to have similar treatment of pensions so that fund managers in Britain could export their expertise to the Continent. There is some sense too in harmonisation of certain aspects of corporation tax. I do not see how Members of this House can object, quite rightly, to the subsidies that are paid to industry on the Continent and at the same time feel that there is no case whatever for looking at special incentives and corporation tax to promote foreign investment. There is a danger of ever bigger subsidies to attract foreign investment. Whether it is done by tax or by grants does not make much difference.
However, the Commission is wrong in its general argument that there has been a reduction of corporation tax and that that has led to higher labour taxes. The Commission wishes to reduce non-wage costs. But the main reason for high non-wage costs is the way in which social security is financed on the Continent. That implies a need to move towards more private pensions. Again, it should be noted that the share of corporation tax has been steady over recent decades. It is a small proportion of GDP. Although the UK has the lowest

1205
rates, its yield from corporation tax is average for the European Union as a whole. In any case, further harmonisation of corporation tax structure is enormously difficult, as one found from the Ruding report some years ago.
Finally, I wish to mention savings. Again, there are disadvantages in a single market if you can avoid or evade tax—quite separate questions—by investing in other countries. We have a 20 per cent. withholding tax in general and there would be advantages if that were more generally applied. But I accept the arguments which have generally been advanced against the proposals coming from the Commission on the withholding tax. It should perhaps pay more attention to its declared aim of preserving the competitiveness of European financial markets. The Commission could certainly learn from the German experience when that country unilaterally imposed a withholding tax and lost billions, or certainly huge amounts.
It is noteworthy that a recent report by the Promethée, a leading, highly regarded French think-tank, makes very much the same arguments: that this is a matter which cannot be considered solely within the European Union; it must be and should be considered within the OECD. The report refers to the danger of a loss of business across the Alps, or, indeed, across the Atlantic. It is not something which concerns only us; it is a general concern. The Commission has said that it will consult—and no doubt it will—and I am sure that the United Kingdom will be extremely effective in making its special representations.
8.31 p.m.
Lord Higgins: My Lords, the House will be grateful to my noble friend Lord Willoughby de Broke for raising this issue. In the time available, one can do really no more than ask questions. It is not an occasion for detailed analysis.
As I understand it, the European Union finance ministers were meeting today. Has anything emerged from those meetings to shed any further light on the Government's policy which, to say the least—despite some of the Minister's previous remarks—remains shrouded in mystery. He has sought to distinguish between the question of harmonisation of taxes generally and, in particular, concentrated on the question of whether there are harmful tax practices on which there might reasonably be a degree of harmonisation. But a definition of what is harmful is something which we still await.
My understanding is that the European Union working group has drawn up a code of conduct which contains 85 such dangerous practices. These have not been revealed to us. Can the Minister tell us whether he will publish that list? Clearly it is impossible to debate it, and great uncertainty is created if we do not have such a detailed list—if, indeed, it exists.
Let me take two examples. One of the suggestions is that the shipping industry is involved. I was much involved in that particular set of amendments. We have to recognise that the shipping industry is a worldwide
1206
industry and not simply a European industry. Harmonisation in Europe may damage our position worldwide. A similar situation exists in the art market. The effect of harmonisation in Europe may damage our competitive position in the worldwide market.
Many noble Lords have spoken about the problem of withholding tax. The issue is so clear that one really ought not say "Well, we may negotiate some compromise or fudge or whatever". We have an interest in this matter in a way which other European countries do not because of our dominance in the market. We ought to make it absolutely clear that, if necessary, we will use the veto and that it is not up for negotiation. That is a point on which the Minister has not made the position clear.
In addition, it is absolutely clear that there is a move towards harmonisation on value added tax. Previously the Minister has indicated that he does not think that this is so. That is not my understanding of reading the documents. Whatever one may say about rates, the crucial point as far as we are concerned—I steered this tax through the House of Commons originally—is the preservation of zero rating. Can the Minister assure us that zero rating will be protected? Certainly after all the fuss the Government made about the reduction in the rate of tax on fuel, one would have thought that they would have a line and again make it clear that zero rating is not negotiable.
The constant fudging of the issues is dangerous. We need an assurance from the Government that they will use the veto when it is clearly in our national interests to do so.
8.34 p.m.
Lord McIntosh of Haringey: My Lords, the Government approach European Union tax issues in the same way as they approach all European issues, and indeed all tax issues—with a hard-headed assessment of what is in Britain's economic interest. The noble Baroness, Lady Ludford, used the word "pragmatic"; I am happy to accept that.
The Government have made it clear that we shall not support any action at European level that will threaten jobs or the competitive position of British business. Any tax proposals will need to pass that fundamental test. The United Kingdom will not sign up to anything that harms investment and jobs or damages the competitive position of Europe.
The noble Lord, Lord Willoughby, and others, sought to cast doubt on what seems to me to be an absolutely clear and unequivocal statement by suggesting that there is something dangerous about the definition of what is fair and unfair tax competition. The position of those who hold the veto is a fail-safe position. It is for us to decide what is acceptable to us and what is not acceptable. If it is not acceptable to us by our own definition, we shall not allow it.
The Government will engage positively with our European partners. It is far better to engage in the debates and shape the outcome than to sit without power on the sidelines. The Government will discuss proposals

1207
constructively in our regular contacts with other member states, but we shall always judge proposals by what is in the national economic interest.
We are in favour of tax competition, not tax harmonisation. And here I pay tribute to the noble Lord, Lord Harris of High Cross, who gave a principled exposition of the need for tax competition rather than tax harmonisation. I entirely agree with him. The way forward for Europe is promotion of economic reforms and competitive markets, not tax harmonisation. Indeed, I said as much in my reply to the noble Lord, Lord Pearson of Rannoch, on 5th October.
However, where there is a case for action at the European level on tax, we will not be afraid to argue for it. In particular, we will continue to work to support effective action to tackle harmful and discriminatory tax practices. I say to my noble friend Lord Shore, we are not ashamed of the word "harmful". It can be well explained and properly discussed, and if we do not like the results of the discussions we shall not allow them to go ahead.
The Government are in favour of concerted action at European level to deal with unfair tax practices that distort real competition, to close tax loopholes and to cease unfair state aids and unfair tax breaks wherever they occur. The Government can deliver those promises. Questions of tax require unanimous agreement, so there is no question of tax changes that we do not support being imposed on us by Brussels.
That is without prejudice to the answer, which was literally correct, that I gave to the noble Lord, Lord Tebbit, on 2nd November. If a directive has been accepted unanimously it has to be enforced by Parliament—of course that is the case—but we have made it clear that British taxation will be decided by the British Chancellor of the Exchequer when he presents his Budget to Parliament. As I have already explained, we have the veto on any tax proposals that would counter that proposition.
We are not isolated in Europe in our stance on tax. UNICE, the European employers' organisation, in its report on company taxation in the single market, stressed that it did not think that full harmonisation of company taxation will ever be needed in the European Union. Just last week, the president of the federation of German industry, Hans Olaf Heukel, stressed that we should not try to eliminate competition between countries, and high corporate taxes across Europe cannot be the solution.
The Prime Minister and the Chancellor of Germany issued a common statement. They support tough action to prevent harmful tax competition and do not support a unified system of corporation tax. There is no question of harmonising income tax, and they will not accept proposals that destroy European Union jobs or damage European Union competitiveness.
I have discussed the principles of the Government's approach. Let me turn now to the tax measures which are under discussion and, indeed, the areas in which there are no proposals. There is no proposal for harmonisation of income tax in the European Union.
1208
There is no proposal, despite what the noble Viscount, Lord Trenchard, and my noble friend Lord Shore say, to harmonise corporation tax.
The Government have made it clear that they support EU action to tackle harmful tax practices. These distort competition in the European economies. As my noble friend Lord Desai said, other member states' harmful tax practices damage investment in the UK. Tackling harmful tax competition will create the preconditions for healthy competition. The code of conduct referred to in debate tackles business tax measures that may be harmful, and I am pleased to hear that it will be considered by the European Communities Committee. But it does not deal with tax harmonisation.
The code is being taken forward by the Code of Conduct Group chaired by the Paymaster General. Aspects of the UK system, together with those of other member states, are being considered by that group. There are five UK measures on the initial list being considered by that group. I say to the noble Lord, Lord Higgins, that although the total may be 85 at present, they are confidential submissions to ECOFIN by individual member states and it is not possible to publish them. I can tell the noble Lord about the UK's submissions. They relate to the following: international headquarter companies (although that matter is to be abolished in April of this year); special tax measures for the film industry; enterprise zones; 100 per cent. first year capital allowances for small and medium enterprises in Northern Ireland and roll-over relief on the disposal of ships. The fact that these are on the initial list of measures that are being considered by that group does not mean that they are harmful. The view of the UK is that none of these measures is harmful within the meaning of the code and the UK will submit a robust defence of the measures.
I turn now to the taxation of savings. The rationale of the draft directive is the prevention of tax evasion. The Government are committed to effective international action to prevent tax evasion and protect the competitiveness of the financial service industries of the United Kingdom and Europe. We believe that exchange of information on a global basis is much more likely to be an effective solution to the problem of evasion than the compromise formula that is currently on offer. We share the reservations expressed by the noble Viscount, Lord Trenchard, about withholding tax. But it is not only the United Kingdom that has problems in this area. There is a long history of difficulties in finding acceptable solutions. We shall negotiate in good faith to try to find a solution that is acceptable to all, but we have made it clear that any future directive must exclude the eurobond market and that the proposals as currently drafted are unacceptable and if necessary we would have to veto them.
A number of noble Lords, including my noble friend Lord Stoddart, said that they were confused. The noble Lord, Lord Higgins, said that the issue was shrouded in mystery. I am sorry to say that the confusion is in the minds of the popular press and noble Lords, not at all in the statements of the Government. We cannot be clearer than we have been.

1209
On the subject of indirect tax, shortly before Christmas the Commission made a proposal to extend the temporary 15 per cent. minimum standard rate and introduce a new 25 per cent. maximum standard rate to the end of this year. That would not affect the UK's standard rate of 17.5 per cent. Like my noble friend Lord Desai, we support a minimum rate but we do not believe that there is an overwhelming case for a maximum rate. In any case, discussions have already indicated that a number of member states cannot accept the introduction of a maximum rate. The probability is that there will simply be agreement to renew the minimum standard rate first agreed by the previous government. Further, there is no risk of the United Kingdom being forced to give up its zero VAT rates on food or children's clothes. All EU VAT matters are subject to unanimity. Therefore, we can guarantee that we shall honour our manifesto pledges.
The Commission has also tabled a draft directive on energy products. This suggests the replacement of existing mineral oils duty directives with a new Community framework for the taxation of all energy products. The Government have made clear that they cannot accept for social policy reasons any obligation to put new taxes on the domestic consumption of gas, coal or electricity.
A number of specific points have been made in the debate to which I shall try to respond. The noble Lord, Lord Hindlip, touched on the art market. He is aware—because we have corresponded upon and discussed the matter—that we are very keen to extend the derogation on the minimum agreed by the previous government or preferably to level down to other countries. What we shall not do is level up to 5 per cent.
The noble Lord, Lord Willoughby de Broke, and my noble friend Lord Shore referred to the European Court of Justice. The ECJ cannot impose harmonisation of personal or corporate tax rates or introduce any common tax regime in areas where member states have not agreed one. These decisions are for governments and are subject to unanimity. The noble Earl, Lord Clanwilliam, said that on pensions water had flowed under the bridge. No water has flowed under the bridge; it has flowed only through his mind. I gave cast iron assurances last time we debated this matter and I stick to them.
The policy of the Government is clear. We shall judge every issue on its merits as determined by Britain's national economic interest. We shall engage constructively with our European partners but shall not accept a proposal if it is not in the national interest. We shall ensure that tax decisions continue to be taken unanimously. In "The Hunting of the Snark" the Bellman in the end was forced to say:
"What I tell you three times is true".
I have told noble Lords far more than three times.

Access to Justice Bill [H.L.]
8.46 p.m.
House again in Committee on Schedule 5.
[Amendment No. 246 not moved.]
Lord Goodhart Lord Goodhart moved Amendment No. 247:
Page 63, line 45, leave out ("may") and insert ("shall").
The noble Lord said: Amendment No. 247 and the other amendments in the same group, Amendments Nos. 248, 259, 260 and 277 to 279, require publication of the advice given by the consultative panel and the Director-General of Fair Trading in relation to Parts I, II and IV of the new Schedule 4 to the Courts and Legal Services Act 1990. There is no equivalent provision in relation to Part III because that is covered by Amendment No. 267 which leaves out that part altogether.
The respective roles of the panel and the Director-General of Fair Trading are important and should be transparent. It should therefore, I believe, be a requirement, not just a power, that the advice they have given should be published. I beg to move.
The Lord Chancellor: These amendments provide that the consultative panel and the Director-General of Fair Trading shall, rather than may, publish the advice that they give to the Lord Chancellor under the new Schedule 4 to the Courts and Legal Services Act 1990. I believe that the amendment would make little difference in practice since such advice must be sent to the authorised body concerned and would be made available to anyone else who wanted it. The 1990 Act gave my advisory committee and the director-general a discretion to publish, but the advice is referred to in their respective annual reports and would in practice be available to those wanting to see it. I am, however, happy to accept these amendments. They are Amendments Nos. 247, 248, 259, 260, 277 and 279.
There is an oddity in this series of amendments in that they do not amend Part III of Schedule 4, presumably because noble Lords who tabled the amendments are opposed to the provisions in Part III. Nevertheless, I think that Schedule 4 should be internally consistent and if these amendments are made I shall seek to amend Part III, accordingly, on Report.
Another oddity relates to Amendment No. 278. That amendment would delete lines 42 and 43 already amended by an earlier amendment tabled by noble Lords. It is an odd amendment, not because it contradicts an earlier amendment, but because it refers only to the advice given by the Director-General of Fair Trading and only in relation to the revocation of designation as an authorised body. I trust that that particular amendment will be withdrawn on the basis that I accept all the others in the grouping.
Lord Goodhart: I am most grateful for the concession made by the noble and learned Lord the Lord Chancellor. It is absolutely right that the schedule should be consistent internally and that similar

1211
amendments should be made to Part III. The fact that my name has been put to Amendment No. 278 is due to the mass of amendments that emerged from, in this case, the Bar Council. I did my best to look through them to make sure that they were correct, but I obviously failed to notice this one. I am entirely happy not to move it.
On Question, amendment agreed to.
[Amendments Nos. 248 to 251 not moved.]
Lord Goodhart Lord Goodhart moved Amendment No. 252:
Page 65, line 1, leave out ("the applicant applies to him in writing,") and insert ("he refuses the application,").
The noble Lord said: Amendment No. 252 is the first of a series of amendments. I wish also to speak to Amendments Nos. 265, 272 and 286. The first three amendments require reasons to be given by the Lord Chancellor whenever he refuses an application for designation under Part I, refuses application for a change of rules under Part II, or imposes a change in rules under Part III. Under the Bill, reasons have to be given only if requested in writing.
It is, however, important that reasons should be given automatically. A body adversely affected by a decision should be told the reasons immediately so that it can, for example, if necessary, take action by way of application for a judicial review. The general principle is that quasi-judicial decisions should contain reasons. I believe that the Lord Chancellor's powers are, effectively, quasi-judicial. In that case, it is desirable that the Lord Chancellor should observe good practice, which is to publish reasons with a decision, especially where a party may suffer adversely. When an application is being approved there may be no necessity to give a reason.
Amendment No. 286 is in a slightly different position. Under Part IV there is no provision for notice to be given at all to a body whose designation is to be revoked. The amendment requires notice of reasons to be given to the relevant body on request. If it seems appropriate that a reason should be given, at least if requested, and to bring it into line with the other amendments, notice of reason should be given automatically. I beg to move.
The Lord Chancellor: I am happy to agree to the purpose of these amendments in principle. Of course, it is right that reasons should be given for decisions. The existing provisions in the Bill allow for the Lord Chancellor to notify the applicant body of the reasons for his decision (on becoming an authorised body, and altering a rule of conduct or qualification regulation) if the applicant applies to the Lord Chancellor in writing. In the case of the call-in power, the authorised body can likewise obtain the Lord Chancellor's reasons by applying to him in writing.
The first three amendments would make it mandatory for the Lord Chancellor to supply his reasons if the application for designation or a proposed rule change was refused. The last would enable a formerly authorised body to apply for reasons for the making of an Order in Council revoking its designation.
1212
The amendment will not make any practical difference. In practice, applicant authorised bodies and authorised bodies would always be given reasons when their application was unsuccessful. The same would apply under the call-in procedure. I agree that the reasons for the Lord Chancellor's decision should be made available to the body which it affects. That is what happens now and what would happen under the new provisions with or without the amendment. I do, however, believe that administrative decisions should be supported by stated reasons. I am therefore willing to take the issue away and consider how the Bill can be strengthened in the way proposed. On that basis I invite the noble Lord to withdraw the amendment.
Lord Goodhart Lord Goodhart: In view of what the noble and learned Lord the Lord Chancellor has just said, I am happy to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 253 not moved.]
Lord Kingsland Lord Kingsland moved Amendment No. 254:
Page 65, line 15, after ("conduct") insert ("which relates to the grant of a right of audience or a right to conduct litigation").
The noble Lord said: Telegraphically, this amendment is designed to ensure that alterations to rules of conduct only require approval by the Lord Chancellor if they relate to the grant of rights of audience or the right to conduct litigation. The Law Society and the Bar Council are both extremely keen that this amendment is passed. It is important to make clear that the provisions of Schedule 5 are not designed to provide a requirement on the Lord Chancellor to approve changes to rules of conduct generally, but only where the rules apply to rights of audience and rights to conduct litigation. I beg to move.
The Minister of State, Cabinet Office (Lord Falconer of Thoroton): I have sympathy with the intention behind these amendments. The point has been mentioned to me previously. The noble Lord wishes to restrict the statutory approval procedure to qualification regulations and rules of conduct which relate to rights of audience and rights to conduct litigation. So does the Lord Chancellor. The noble Lord also wishes to restrict the Lord Chancellor's call-in power, although it is true to say that in other amendments he would oppose the power altogether, to qualification regulations and rules of conduct which relate to rights of audience and rights to conduct litigation. So does the Lord Chancellor. However, in relation to the call-in power, I should make it clear that the Lord Chancellor would go further than the amendment. He has already said that he will look further at how the call-in power may be restricted, not to rules and regulations related to rights of audience and rights to conduct litigation, but to those which are "unreasonably" restrictive of rights of audience and rights to conduct litigation. This was a point raised by the Select Committee on Delegated Powers and Deregulation and, as I have indicated, the Lord Chancellor is already considering how its concern can be met.

1213
Perhaps I may turn to the point raised by the amendment: that the provision be restricted to rights-of-audience type rules and not to all rules. Qualification regulations and rules of conduct—the phrase used in the Bill—are already defined in Sections 27 and 28 of the Courts and Legal Services Act 1990 by reference to rights of audience and rights to conduct litigation. The definition in Section 27 of that Act, for example, is as follows:
"'Rules of conduct', in relation to an authorised body, means rules of conduct (however they may be described) as to the conduct required of members of that body in exercising any right of audience granted by it".
Section 119, the definition section of the 1990 Act, relies on the definitions found in Sections 27 and 28. So only those rules and regulations which relate to the grant or the exercise of a right of audience or a right to conduct litigation are subject to the statutory approval procedure. That is the position now; it will remain the position under the existing—that is, amended—provisions in the Bill.
I do not think that the amendments are sufficiently wide in referring only to the "grant" of a right. That in my view is too restrictive. The Bill, like the 1990 Act, covers not only rules governing the grant of rights but also their exercise.
To sum up, the amendments are unnecessary to meet the point so clearly put by the noble Lord. They do not go far enough in relation to the call-in power. The Lord Chancellor has already indicated that he will seek to deal with that. In any event, even if they were in the target area, they are drafted too restrictively because they do not refer to "exercise". In the circumstances, with the greatest respect, I invite the noble Lord to withdraw the amendment.
9 p.m.
Lord Kingsland: In thanking the noble and learned Lord for his reply, I look forward keenly to seeing the fresh draft that he will no doubt table at Report stage. I counted at least two bonus points in his reply which I gratefully accept. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Goodhart Lord Goodhart moved Amendment No. 255:
Page 65, line 16, at end insert ("and the designated judges (acting, in the event of disagreement, by majority)").
The noble Lord said: This is the first in a group of amendments which seek to retain the judicial veto on applications for changes of rules under Part II of the new Schedule 4. The principle has already been discussed. I do not propose to go into it again. However, there is a special feature in connection with Part II. Part II is the only part of the schedule in relation to which there is no parliamentary control. That was true under the 1990 Act—the old version of Schedule 4—but it is equally true under the revised version.
The reason that there is no parliamentary control is reasonably apparent. It is that if a rule change put forward by an authorised body meets with no objection
1214
by the Lord Chancellor or any of the designated judges, why should it need to be made by a statutory instrument? Rule changes could have a radical effect on rights of audience—for example, by widely extending them as a result of changes in the rules of an existing authorised body—which could have virtually the same effect as admitting a new authorised body. That being so, it seems to me that there is a case for retaining here a degree of judicial control in lieu of parliamentary control and extending to Part II the same principle that we seek to extend to the other parts; that is, that the approval should require the joint action of the Lord Chancellor and at least two of the designated judges. I beg to move.
The Lord Chancellor: As the noble Lord indicated, we have a feeling of déjà vu in our discussion of this group of amendments. They are essentially the same as the amendments grouped with Amendment No. 245. They are similarly intended to reinstate the veto of the designated judges or the decisions taken under Schedule 4 to the 1990 Act which will be substituted by Schedule 5 to the Bill.
As the noble Lord said, the difference is that these amendments relate to Part II of the schedule rather than Part I. Part II deals with the procedure for approving alterations in the rules of authorised bodies.
As before, the amendments would not restore the individual vetoes of each judge. They would require decisions to be taken jointly by them and the Lord Chancellor, and in the event of a difference of opinion, by a majority of the designated judges and the Lord Chancellor. That would mean that the Lord Chancellor could act only if at least two of the four judges agreed with him.
The issues of principle are the same in relation to Part I as Part II. I do not repeat the arguments. I do not accept that constitutionally rights of audience are a matter for the judiciary to determine. On the contrary, they are a matter for Parliament to determine. They are statutory rights under the 1990 Act in exactly the same way as rights to conduct litigation, and they are properly subject ultimately to parliamentary control.
The power that is given to the Lord Chancellor by Part II of the schedule is that of agreeing, or not agreeing, to proposals initiated by the authorised bodies to alter those of their rules which relate to rights of audience or rights to conduct litigation. Part II importantly does not give the Lord Chancellor the power to initiate such changes himself. That is an important point. Most applications to alter the rules in practice are routine and uncontroversial. But they still take a substantial time to process under the complex procedures of the 1990 Act. Part II will enable me to approve simple changes quickly after consultation with the designated judges. But more complex or controversial changes will be referred to the new legal services consultative panel and the Director-General of Fair Trading for advice before a decision is taken.
As I have already said, the designated judges will retain a powerful role in advising me on the exercise of the powers in the new Schedule 4 to the Act. I repeat

1215
that it is unlikely that we will disagree about many or any applications made under the Act. However, I agree with the noble and learned Lords the Lord Chief Justice and the Master of the Rolls that the current system does not work. Responsibility for making changes and taking decisions should lie with the Lord Chancellor as a Minister accountable to Parliament. I hope that in the circumstances the noble Lord will agree to withdraw the amendment.
Lord Goodhart: Naturally, I am disappointed with the noble and learned Lord's reply. While I agree that parliamentary control is appropriate, there is under Part II no question of any parliamentary control. That is why the position is somewhat different. Obviously, I have no intention of pressing the amendment tonight and I beg leave to withdraw it.
Amendment, by leave, withdrawn.
[Amendments Nos. 256 to 258 not moved.]
Lord Goodhart Lord Goodhart moved Amendments Nos. 259 and 260:
Page 66, line 31, leave out ("may") and insert ("shall").
Page 66, line 45, leave out ("may") and insert ("shall").
On Question, amendments agreed to.
[Amendments Nos. 261 and 262 not moved.]
Lord Goodhart Lord Goodhart moved Amendment No. 263:
Page 67, line 36, at end insert—
("( ) The Lord Chancellor shall not refuse the application unless he has sought the advice of the Consultative Panel.").
The noble Lord said: The amendment relates to Part II, the approval by the Lord Chancellor of rule changes sought by authorised bodies. On such an application, the Lord Chancellor may ask advice from a consultative panel, but does not have to do so. Paragraph 10 allows the Lord Chancellor to act without consulting the panel after seeking and considering advice from designated judges.
If the rule changes are straightforward and uncontroversial, and the Lord Chancellor proposes to approve them, I see no need for the panel to consider them. However, I believe that it would be inappropriate for the Lord Chancellor to reject an application without consulting the panel. The authorised body would have a justifiable grievance if he did so. The amendment would prevent that. I beg to move.
Lord Falconer of Thoroton: I accept in principle the purpose of the amendment. The noble Lord is right in saying that the purpose of not consulting would be in an uncontroversial application. If the Lord Chancellor is to refuse an application it is appropriate that he should consult the consultative panel. He would do so in practice and there is no reason why that should not be put on the face of the Bill. I ask the noble Lord to withdraw the amendment on the basis that we will come back with another one because we are unsure of the drafting.
Lord Goodhart: In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 264 to 266 not moved.]
Lord Goodhart Lord Goodhart moved Amendment No. 267:
Page 68, line 1, leave out from beginning to end of line 43 on page 69.
The noble Lord said: The amendment relates to the same point. It proposes to leave out Part III altogether. In order to avoid having to go through the issue again, it might be convenient to deal with further amendments which seek to leave in Part III but require the consent of two of the designated judges. The same principle applies to Part IV.
The principle has been discussed at length. The power of the Lord Chancellor under Part III to enforce rule changes on authorised bodies has undoubtedly aroused more objections than any other part of the Bill. It has been attacked in particular by the noble and learned Lord, Lord Steyn, in a public lecture and Mr. Sydney Kentridge in an opinion referred to by the noble and learned Lord, Lord Ackner.
When those two people speak it is wise to listen. Neither is in any sense a professional trade unionist. Both are people of strong liberal commitment, both coming from the Republic of South Africa. During the apartheid era, the South African legal profession and judiciary had a relatively good record. They displayed a high degree of independence. It could not prevent the enactment of unjust laws but at least it ensured that those charged with breaches of the laws were given a fair trial. As Mr. Kentridge pointed out, one of the South African Government's objectives was to obtain control over the legal profession, to impose their will on it and to get rid of its inconvenient independence, and they were unable to do that.
I am not suggesting that the present Lord Chancellor would in any way abuse his powers under Part III. That is not a mere conventional statement. On these Benches we recognise fully his achievement in introducing the Human Rights Act and taking it through your Lordships' House. That illustrates his profound personal commitment to human rights. But in giving himself powers which he would exercise benevolently, he is also giving his unknown and unpredictable successors powers which they could exercise malignly.
The Lord Chancellor has moved some way from the original proposal by accepting that rule changes can be made only by order approved by affirmative resolution, which was not the position originally in the White Paper. But I do not believe that that is enough. I have already expressed doubts as to whether even the affirmative resolution procedure is an adequately effective safeguard. That power, if wrongly exercised, could do very grave damage to the independence of the legal profession.
I am not an absolutist on this issue. Amendment No. 271 allows the Lord Chancellor to make an order for rule changes if two or more of the designated judges approve. If the Lord Chancellor were minded to accept that amendment, I should not seek to press this one. But I do not believe that the Lord Chancellor should have power, even if that power must be endorsed by statutory

1217
instrument, to enforce rule changes of authorised professional bodies even if not a single one of the designated judges agrees with it. If that happens, either the Lord Chancellor should back down or he should impose rule changes by primary legislation. I have never suggested for a moment that that would not be an appropriate course.
I turn now to amendments dealing with Part IV on this issue; that is, Amendments Nos. 275, 276 and 280 to 284 inclusive. They give the Lord Chancellor power to revoke designation as an authorised body. Paragraph 25(2) in Schedule 5 provides when that designation can be revoked. Under paragraph 25(2)(a) or (b), there is obviously no problem where the revocation is agreed by the body whose designation is being revoked. But the Lord Chancellor has a power to recommend revocation under paragraph 25(2)(c) where he is satisfied,

"that the circumstances at the time when he is considering whether to make the recommendation are such that, had that body then been applying to become an authorised body, its application would have failed".
In theory, that power can be exercised so as to revoke the designation of the Bar Council or the Law Society. That would happen only if a dictatorship assumed power, and no statute or constitution can give an ultimate protection against a violent dictatorship. But that illustrates the width of the power.
Furthermore, the test for revocation is the Lord Chancellor's belief that had the body in question been applying to become an authorised body, that application would have failed. That is a very unsatisfactory test because Part I, which provides for approval, contains no criteria for granting the application. Therefore, the test is doubly subjective.
The Lord Chancellor's satisfaction that the relevant circumstances exist is necessarily subjective, as is his decision as to why the application would have failed in the absence of any identifiable criteria. For the reasons which I have already stated, I do not believe that the need for approval by Order in Council, by the affirmative resolution procedure, is, in relation to powers of such outstanding constitutional importance, a sufficient safeguard.
Revocation of the rights of an existing body has a far more serious effect on the administration of justice than the extension of rights to a new body. I believe that the consent of at least two of the designated judges is necessary before an Order in Council, under Part IV, can be made. Once again, if not, then the Lord Chancellor should have to enact primary legislation.
9.15 p.m.
The Lord Chancellor: I certainly agree that when Mr. Sidney Kentridge Q.C. or the noble and learned Lord, Lord Steyn, speak, it is wise to listen but it is not obligatory to agree with them.
I recognise that Part III of the new Schedule 4 is highly controversial. But the power is not unfettered either in its scope or in its exercise. It relates only to those rules and regulations which govern rights of audience or rights to conduct litigation. I accept that it
1218
should be used only to remove undue restrictions on the exercise of those rights. I have already said that I will bring forward an amendment to this effect. The exercise of the power is subject to an extensive consultation procedure and then to approval by both Houses under the affirmative procedure.
I have to say that I cannot agree with the noble Lord, Lord Goodhart, that approval by both Houses under the affirmative procedure is insufficient either in practice or in constitution. Because of the requirement for affirmative approval the possibility of some maverick Lord Chancellor of the future suddenly taking it into his head to re-write the rules of the legal profession and being subject to no control cannot be substantiated.
We have had this argument already. I will be as brief as I can. There are several lines of argument advanced against this power. One is an absolutist position: that it is constitutionally wrong for the Executive and the legislature to have a power of this nature over the legal profession. In this view rights of audience in particular are and have been a matter for the judiciary where these exclusive rights of audience were delegated or conferred by the judiciary on the Bar at some remote period of history, a transaction of which unfortunately no written record survives.
My noble and learned friend Lord Falconer demonstrated at Second Reading, I would suggest conclusively, that the argument that Parliament and the Executive simply have voluntarily abstained from intervening in rights of audience is simply inaccurate. Parliament has often legislated on the subject, not least in the Courts and Legal Services Act 1990 itself. Since that Act all rights of audience have been placed on a statutory basis, including those of the Bar.
Lord Goodhart: I am most grateful to the noble and learned Lord the Lord Chancellor for giving way. This argument I am afraid is once again getting repetitive because I have made it clear before and must make it clear again that I have never objected to the power of Parliament to change these rules by primary legislation. The real question here is the adequacy of secondary legislation.
The Lord Chancellor: That is the real question so far as concerns the noble Lord, but the noble Lord must appreciate that we disagree on this matter. There is not much virtue in disagreeing again. That itself would be repetitious, but the noble Lord must also appreciate that I am not merely addressing him; I am addressing the whole Chamber in Committee and there is a wider public interested in these matters.
What I was explaining was that barristers do not exercise these rights of audience, derived in some curious way from the judiciary. What they exercise are statutory rights which have been granted to them by the Bar Council, which is a body authorised for that purpose under an Act of Parliament, the 1990 Courts and Legal Services Act. The Act also imposes a statutory procedure for approving changes in these rights. It is simply untrue that rights of audience have historically

1219
been the exclusive reserve of the judiciary in which the legislature and the Executive have uniformly abstained from intervening.
The fact is that extensions of rights of audience have often taken place as a result of government legislation as the judiciary have either failed to see the need for such extensions or have thought that they lacked the power to bring them about. For example, Section 2 of the Trials for Felony Act as long ago as 1836 allowed barristers and attorneys rights of audience in magistrates' courts following a judicial decision that they had no entitlement to appear there. Parliament struck down the view of the judges; Parliament is sovereign.
In 1846 Parliament legislated again to enable barristers to appear in the Court of Common Pleas which had been traditionally reserved to the Serjeants at Law. When the Crown Court was established in 1971 the Courts Act enabled the Lord Chancellor to direct that solicitors should be able to appear in any description of proceedings that he might specify. Rights of audience in the county courts were dealt with in the County Courts Act 1984 and, before that, in the Acts of 1959 and 1934.
The "authorised bodies", including the Bar Council, are so called because they are authorised to grant those rights under the 1990 Act. Their rules and regulations relating to those rights are not made through powers delegated by the judiciary through the Inns of Court; they are made under statutory authority and subject to a statutory approval procedure.
At the time the 1990 Act was passed, the Bar and the Law Society of course already had rules in place—this addresses the next point of the noble Lord, Lord Goodhart. These were deemed to be approved for the purposes of the Act, but were made subject to a procedure under which they could be challenged and would fall if not upheld unanimously by the designated judges and the Lord Chancellor. It cannot be in the public interest for a single judge to have such power.
I therefore already have an individual veto over a large part—if not the majority—of the rules and regulations of the Bar Council and the Law Society. I could, for example, strike down the Bar's rules about employed lawyers, if I wished, and I would not need the approval of Parliament or the designated judges to do so. Of course, I would not dream of doing so.
Why, then, have I proposed to take this new power? There are two reasons. First, my existing power is only to strike down rules, and not to replace them. We all believe that lawyers should be subject to rules and regulations, in the public interest, and it would be inappropriate for me to remove rules merely to leave an unregulated vacuum. Secondly, my existing power does not allow me to revisit rules which have been approved, but which have proved to be unacceptably restrictive in practice or have become outmoded. The new power I propose will also have the advantage of much greater scrutiny over the actions of the Lord Chancellor. He will no longer be able to strike down or alter any rules unless Parliament has approved. I emphasise this point. The revocation power only relates to bodies authorised by
1220
Order in Council. The Bar and the Law Society are authorised by statute—the 1990 Act—and therefore the revocation power has no application.
Finally, there remains a deeper question. Is it the view of the Government that they expect such entrenched hostility from the legal profession, such opposition to any moves to widen rights of audience, that they envisage the Lord Chancellor having to use his exceptional fall-back power regularly? The answer to that question is, "Certainly not". I and my department have excellent relations with the legal profession which we are confident will continue. I believe that most of the Bar have now accepted, perhaps with some reluctance, that rights of audience in the higher courts will be extended to Crown prosecutors and those who are wise among them will not be in the least encouraged by tonight's aberrant vote in which the Liberal Democrat Benches opposite did not participate.
I think that it is generally accepted that it is right, in the public interest, that rights of audience in the higher courts will be extended to Crown prosecutors, to other employed lawyers and to solicitors, provided that they meet the necessary requirements. I look forward to the Bar making proposals to grant rights to conduct litigation to employed barristers. I hope that the mindset among some of the Bar resisting any form of modernisation will shortly become a part of a rather unbelievable past.
The record of inactivity over the past decade, since the 1990 Act was passed, in my firm view demands action, and now. This backstop power, which I hope that neither I nor any successor Lord Chancellor will ever have to exercise, will spur the authorised bodies into sensible action in the public interest if they know that the Lord Chancellor will, in the last resort, and only with Parliament's approval, ensure that Parliament's will is carried into effect in matters which relate to what are inherently restricted practices and can be justified only by reference to the public interest. I repeat that Parliament, not the judiciary, is the ultimate judge of the public interest. I hope on that basis that the noble Lord will agree to withdraw his amendment.
9.30 p.m.
Lord Goodhart: I do not think that the Lord Chancellor will have expected me to listen to his statement on this group of amendments with much enthusiasm. Nevertheless, it is inappropriate this evening to take the matter further. Therefore, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 268 and 269 not moved.]
Lord Archer of Sandwell Lord Archer of Sandwell moved Amendment No. 270:
Page 69, line 36, after ("shall") insert (", if he is satisfied that any qualification, regulation or rule of conduct is unduly restrictive of rights of audience or of a right to conduct litigation.").
The noble and learned Lord said: At the risk of being tiresome, this amendment was grouped with the amendment in the name of the noble Lord, Lord Goodhart, which he has not moved, Amendment No. 268.
It may be that I am the only Member of the Committee who is not now crystal clear about the position we have arrived at in the course of the last few debates. Of course I assume, for the purpose of this amendment, that changes in the rights of audience and particularly in enforcing rule changes will be made by the Lord Chancellor with no participation in the decision-making by the designated judges. I say that I assume it; as to whether I approve of it, I remain something of a Hamlet, and I shall watch this space at subsequent stages.
We have had some incursions into legal history. At Second Reading my noble and learned friend Lord Falconer pointed out that there were historical precedents for changes to the rights of audience which were not initiated by the senior judiciary. My noble and learned friend the Lord Chancellor has just repeated them. The examples they gave were of interventions by Parliament, which is not what this Bill originally proposed. Incursions into legal history are always fascinating yet it is always perhaps a little dangerous to reduce them to single sentences as that may mean an over-simplification. Certainly, in the late 16th century, when the present structure relating to rights of audience was developed, it was the judges who sought to restrict the rights of audience in the superior common law courts to those who, by their studies, had made themselves competent. Perhaps it is fair to say that the subject seems to have been regarded less as a constitutional issue than as a matter of consumer protection.
However, my noble and learned friends are right: there have been times when the legislature has felt a need to intervene. I seem to remember that in the late 14th century, Alice Perrers, the mistress of Edward III, became so notorious for intervening in court, particularly in favour of her friends and presumably of her paying acquaintances, that in 1376 Parliament passed an Act forbidding women to practise in the law courts. So the precedents go back a long way.
However, as I ventured to say, those precedents were about interventions by Parliament. That is not what is proposed in the Bill; indeed, the Bill proposes that the intervention shall be by my noble and learned friend alone. Perhaps it is not totally irrelevant to point out again that the Delegated Powers and Deregulation Committee, of which the noble Lord, Lord Goodhart, and I are privileged to be members, suggested that we should consider two restrictions on the power of the Lord Chancellor to alter rights of representation under Schedule 5.
It suggested, first, that there should be some precondition stated by Parliament on the face of the Bill so that the Lord Chancellor might alter the provisions only if a case had been made out for the changes. In Amendment No. 270 I have tried to follow as far as possible the actual wording of the committee. I know there was an earlier debate about that, but I would be most grateful to know the reactions of my noble and learned friend about interposing some such statement at this stage. As I understand it, it would make it possible for decisions of the Lord Chancellor to be the subject of
1222
judicial review. That does not seem to me to be the end of civilisation as we know it. For the moment, therefore, I propose to move my amendment.
As to the second recommendation of the Committee—namely, that the matter should be subject to parliamentary control by the affirmative resolution procedure—my noble and learned friend has said repeatedly during the course of our debates that that will be the case and that that is what he proposes. Therefore, I can spare noble Lords an intervention at a later stage by saying now that I do not propose to move Amendment No. 273 in due course. For the moment, I beg to move Amendment No. 270.
The Lord Chancellor: The noble Lords, Lord Goodhart and Lord Thomas of Gresford, have not moved their Amendment No. 268. However, as I would have expected, my noble and learned friend Lord Archer of Sandwell has stuck to his amendment to the last, and moved it. I should remind my noble and learned friend that I clearly stated my position in relation to the matter when making my opening speech to this Chamber at the outset of our considerations on the Bill in Committee. Of course, in practice the call-in power, if it is used at all, will only be used to remove restrictive rules. Therefore, I am content in principle to accept a limitation of the type that these amendments would impose, as indeed I have already said. However, I shall need to consider precisely how the amendment should be drafted. I hope that I shall be able to return to the matter on Report with an amendment. In the meantime, I should be grateful if my noble and learned friend would withdraw his amendment.
Lord Archer of Sandwell: My noble and learned friend cannot say fairer than that. However, I wanted to ensure that what he said earlier applied particularly to this provision. For the moment I am content and, therefore, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 271 to 273 not moved.]
Lord Goodhart Lord Goodhart moved Amendment No. 274:
Page 69, line 43, at end insert—
("( ) When an order under this paragraph is laid before either House of Parliament there shall be laid with it copies of all representations made under paragraphs 18 and 21 and advice given under paragraphs 19, 20 and 22.").
The noble Lord said: I shall speak shortly to this amendment. If the Lord Chancellor makes an order imposing rule changes under Part III of the schedule, the amendment would require him to lay before Parliament the representations received by him from the body whose rules are to be changed and the advice received from the consultative panel, the Director-General of Fair Trading and the designated judges.
The Lord Chancellor has already accepted that the advice from the consultative panel and the Director-General of Fair Trading should be published, but, when considering an Order in Council in this case, it seems to me that it would be appropriate for Parliament to have before it all the material which is

1223
relevant to considering whether an order should be adopted. What I believe requires to be added to the advice of the consultative panel and the Director-General of Fair Trading are the representations made by the body whose rules are to be changed and the advice given by the designated judges. That is clearly information which Parliament ought to have before it when considering whether to approve the order.
Amendment No. 285 has the same effect as Amendment No. 274 in relation to Part IV which gives the Lord Chancellor the power to revoke the designation of an authorised body. I beg to move.
The Lord Chancellor: I already indicated my position in principle in relation to this in response to a question directly put to me earlier in these proceedings by the noble and learned Lord, Lord Lloyd of Berwick. He asked whether I would be willing, where my decision departed from the advice of the designated judges, to publish both their advice and my reasons for not accepting it. I said that so far as I was concerned, in principle I would be happy to do so.
The representations in question—that is to say, those covered by these amendments—are from the authorised body and the advice is from the legal services consultative panel and the Director-General of Fair Trading. I certainly have no objection in principle, and indeed would support, any of these being laid with the draft resolutions. However, despite the comments of the noble and learned Lord, Lord Lloyd of Berwick, I have to express some reserve in relation to the position of the designated judges until I can ascertain collegiately what the position of the designated judges is.
There is no provision on the face of the Bill for the advice of the judges to be published, although nothing whatsoever prevents them from publishing their advice if they wish to do so. Under the 1990 Act the designated judges are of course joint decision makers, and there is provision for the applicant to obtain the reasons given by each of the designated judges, as well as the Lord Chancellor, in reaching his decision under the 1990 Act. These amendments would require their advice to me to be published. Whereas I have no objections whatsoever to that in principle—as I have already indicated in my response to the noble and learned Lord, Lord Lloyd of Berwick—it is a novel step for the judges' advice to the Lord Chancellor to be published, and one which I would wish to discuss with them, as it were collegiately, before coming to a settled view, although for my part I wish to make it absolutely plain that I would be content for the judges to be treated in exactly the same way as the consultative panel and the Director-General of Fair Trading.
The value in the judges' advice of course rests in their experience and independence. All I say is that I wish to take time to consider with the judges collegiately how to proceed in relation to that part of the amendment. In the meantime on that basis I should be grateful if the noble Lord will withdraw these amendments.
Lord Goodhart: On that basis I am happy to withdraw the amendment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 275 and 276 not moved.]
Lord Kingsland Lord Kingsland moved Amendment No. 277:
Page 70, line 33, leave out ("may") and insert ("shall").
On Question, amendment agreed to.
[Amendment No. 278 not moved.]
Lord Kingsland Lord Kingsland moved Amendment No. 279:
Page 70, line 42, leave out ("may") and insert ("shall").
On Question, amendment agreed to.
[Amendments Nos. 280 to 286 not moved.]
Schedule 5, as amended, agreed to.
Clause 36 [Overriding duties of advocates and litigators]:
9.45 p.m.
Lord Kingsland Lord Kingsland moved Amendment No. 287:
Page 20, line 40, at end insert—
("(2B) An act—

(a) which is intended by the person committing it to bring about a breach of the duty imposed by subsection (2A)(a); or

(b) which the person committing it ought reasonably to appreciate is likely to bring about such a breach,

shall be punishable as a contempt of the court concerned.'"').
The noble Lord said: This amendment seeks to strengthen the provisions of the clause by providing a sanction against those who procure a breach of it.
The Government's recognition of the duties of advocates and litigators to the court and to their codes of conduct is welcome. But this clause is simply declaratory. It provides no sanction whatsoever for inducing a breach of it. The advocate or litigator himself may be liable to professional disciplinary penalties, but those who are not members of the regulatory professions are not subject to disciplinary rules at all.
There is an obvious danger that employers may seek to put their employees under pressure to act in breach of their duties to the court or to their codes of conduct. That would certainly be a breach of Clause 36, but there is no sanction for that breach. Given the duty to the court, the sensible solution would appear to be to make the breach of this clause a contempt of court and allow the court to impose its own sanctions.
Often, the fault will lie not with the lawyer, who may be acting perfectly properly and be placed in an impossible position by his employer, but with the employer who created the situation. It is crucial that the person actually procuring the breach should be held liable for it. I beg to move.
Lord Falconer of Thoroton: As I read these amendments, they are aimed at someone who induces the lawyer to act in breach of his duty under Clause 36. Therefore the provision would impose on a secondary party a liability for contempt of court.

1225
We have carefully considered the amendments and believe, for reasons that I shall outline, that they are neither appropriate nor necessary. They would in effect be imposing a liability for contempt which would not necessarily attach to the advocate or litigator himself; that is, the notional primary party. That is because, while it might constitute a contempt for a lawyer to act in a way which breached his duty to the court in the interests of justice, it would not necessarily be a contempt of court by the lawyer to act in a way that breached Clause 36. It would be a matter for the court to decide in each case. The courts are in fact very slow to penalise lawyers for what may simply be an error of judgment(as the cases on wasted costs orders have shown).
Lay members of the public—such as employers or clients—have to rely on the advocate or the litigator to explain where the interests of justice lie in relation to a particular action. It is for the lawyer to explain whether any proposed course of action would breach his, the lawyer's, duty to the court. Since the new sections inserted by Clause 36 go on to state that the lawyer's duties override any other obligation, it must follow that either the lawyer has to refuse to follow the instructions or cease to continue acting in the case. If, however, the lawyer were to give way, and do something that was in breach of his duty to the court—the effect of the provision in Clause 36 is that it overrides everything else—then he, the lawyer, is to blame. He cannot turn round and blame his client. On the basis of that analysis, the amendment is misfocused and unnecessary. In effect, the lawyer must be able to resist. If he does not, it is the lawyer who is to blame and not the secondary party. Yet the effect of the amendments is to make the secondary party liable for contempt.
Less importantly, the amendment is also technically misconceived. It refers to a person who "ought reasonably to appreciate" that it is likely to bring about a breach of duty. But he is by definition a person who may well not know that his act will have that effect and he could only remain in ignorance through his lawyer's failure to enlighten him. That, again, would be the fault of the lawyer, yet this amendment creates a new offence for someone else.
As a matter of principle, I do not think it is acceptable to have an offence of this kind which consists of bringing about conduct by another person which is not in itself necessarily either a criminal offence or a contempt. Procuring or abetting a non-criminal action, or attempting to do so, should not be a crime.
I should reassure the Committee that, of course, cases in which a client or employer or anyone else attempts to interfere improperly in the processes of justice can already be punished as a contempt. They do not need a provision such as the one put forward by the amendment. Moreover, in the most serious cases, it may be appropriate to bring proceedings for perverting the course of justice or for attempting or conspiring to do so.
1226
I hope that in the light of my explanation the noble Lord will agree to withdraw his amendment.
Lord Kingsland: I am partially reassured by what the noble Lord said. I shall read his remarks carefully in Hansard. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 288 not moved.]
Clause 36 agreed to.
Lord Kingsland Lord Kingsland moved Amendment No. 289:
After Clause 36, insert the following new clause—

DUTY TO ADVISE CLIENT: SPECIALIST ADVOCACY
(" . In the Courts and Legal Services Act 1990, after section 31C (inserted by section 33 above) insert—
"Duty to advisers to suitable advocate.
31D.—(1) A person exercising a right to conduct litigation must, in relation to any advocacy to be conducted in proceedings before a superior court of record, advise his client in writing as to whether or not that advocacy ought to be conducted by a person offering specialist advocacy on a referral basis.
(2) In considering that question, the person concerned must have regard, in particular, to—

(a) the relative cost to his client of obtaining advocacy services on a referral basis and of relevant alternative means of providing them; and

(b) the degree of skill and experience which the circumstances require of the advocate.

(3) Where, before the advocacy in question is conducted, a person fails to comply with the duty imposed by subsection (1) but he or his firm nevertheless conducts that advocacy, neither he nor his firm shall be entitled to charge the client for that advocacy.'"').
The noble Lord said: This amendment seeks to require solicitors and other litigators, when advising clients who need an advocate to represent them in court, to consider whether it would be appropriate to instruct an independent advocate to represent them and to advise the client accordingly. If all solicitors are to gain full rights of audience, then they must be required to exercise those rights in a situation of full and fair competition. The Bar is a referral profession of advocates, depending for its involvement in criminal and civil cases on instructions from solicitors.
What is essential, if the Bar is to survive as a strong and independent profession—which the noble and learned Lord indicated he wishes to see—is that competition from other advocates in the solicitors' profession is fair. How will that be guaranteed? When the 1990 Act was enacted, the Bar cautioned that solicitors in the first contact with lay clients would be likely to tie in lay clients to advocacy by solicitors within solicitors' firms, denying the lay clients the specialist advocacy which the lay clients needed and imposing on the lay clients the high cost of solicitor advocates. By "tying in" we do not mean simply a formal condition imposed by the solicitor that the client must use the firm's advocacy services.
We are also concerned about the risk of a more insidious approach by firms of solicitors who may establish a policy that, unless it suits the firm, the client

1227
will not be given an informed choice of advocate. Clients may not be advised that they ought to consider the alternative of instructing a barrister, that it may be cheaper to do so and that there are specialist barristers in the field who are skilled and experienced advocates.
I am aware that the Law Society's practice rules require solicitors to advise clients of the respective advantages and disadvantages of advocacy by in-house solicitors and by banisters, with particular reference to costs, specialist skills and expertise. In theory, therefore, there are rules designed to deal with those concerns.
I remain anxious, however, that in practice those rules are often ignored. Solicitors combining advocacy and the conduct of litigation have a strong incentive to persuade clients to use an in-house solicitor advocate, even when a banister advocate would be more economical or more suitable or both.
For that reason I believe it essential that the law should provide that litigators should give clients proper advice in writing about whether or not they should use an independent advocate. I believe that failure to provide such advice should result in the litigator not being paid for the advice. That would bite particularly in contentious matters where the existence of the advice could be verified on taxation of costs by the court. I beg to move.
The Lord Chancellor: This is an extraordinarily bold amendment. Unless I am very wrong, I see the footprints of my friends in the Bar Council all over this amendment.
The amendment has something in common with those proposed to Part I of the Bill, which would have required the legal services commission to keep under review whether the interests of justice required particular kinds of service to be provided by banisters. This amendment would go considerably further. Its effect, essentially, is to require solicitor advocates to advertise to their clients the availability of barristers in private practice. That really is an intriguing proposition.
Attempts have been made to justify such a proposition by reference to the existing "tying-in" provisions of Sections 104 to 106 of the Courts and Legal Services Act 1990. These would prevent mortgage lenders from offering residential property loans as part of a package with other specified services—banking and financial services, estate agency services and conveyancing—without making it clear that the loan is separate from the provision of the services, and is available separately, and stating the price of the services offered. I say "these provisions would prevent", but they have not been brought into force. I understand that they are viewed as unworkable.
In any event, these existing tying-in provisions were designed to protect the public from paying inflated prices for mortgage loans, unaware that they were really paying for a package of ancillary services. Lenders are required to separate out any services they offer into their component parts and to price them separately. They are not required to advertise the services of their rivals.
1228
By contrast, this amendment is designed to protect the Bar, not the public. It does not require solicitors to specify in advance how much they would charge for any advocacy services. It could hardly do so without imposing the same burden on the Bar. Rather it imposes the requirement to advertise the availability of barristers in private practice.
The amendment relates only to the higher courts, where, I suppose, the interests of the Bar in retaining the work exclusively is greater. I think that by and large the sort of clients who would go to the big City firms to fight litigation in the higher courts through in-house lawyers would be able to look after themselves.
Another startling aspect of this amendment is the lack of reciprocity it provides for. I see no obligation on barristers to advertise the availability, expertise and relative costs of solicitor advocates, even in the increasing number of cases which are sent directly to a member of the Bar and not referred by a solicitor.
This amendment must be seen for what it is. It is one of several which, in various ways, have either attempted to guarantee work for the Bar or protect the position of the Bar. I do not think that it is appropriate for its work to be guaranteed, either by the Government or by statute. Barristers must stand on their own feet and meet the challenge presented by such new competition as this Bill will open up. I have every confidence in the Bar's ability to thrive in a more competitive environment. But it must thrive because of the excellence of the service that it provides and the competitive prices that it charges—not because areas of work have been reserved for barristers in private practice and obstacles put in the way of their competitors; and not because they have to oblige their solicitors to advertise the services of the Bar. I hope that the noble Lord will agree to withdraw this amendment.
Lord Kingsland: The reply of the noble and learned Lord was uncharacteristically unsporting. The object of the amendment is not to give the Bar an unfair advantage but to ensure that there is fair competition for advocacy services. All it seeks to do—there may be other ways of doing it more effectively and less offensively—is to ensure that when a client decides that he requires an advocate on the balance of quality and price he receives the best service that is available.
There will be circumstances in which solicitors' firms will be inclined to bias matters unfairly in favour of in-house advocates. As I understand it, the noble and learned Lord the Lord Chancellor has a central objective in making these new rules; namely, to ensure that there is fair competition to provide the general public with a quality service at a reasonable price. Whatever the noble and learned Lord thinks about the wording of the amendment I hope that he will reflect upon its background. I look forward to seeing his own drafting efforts at Report stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
10 p.m.
Lord Goodhart Lord Goodhart moved Amendment No. 290:
After Clause 36, insert the following new clause—

GENERAL COUNCIL OF THE BAR: SUBSCRIPTIONS
(" .—(1) It is hereby declared that, notwithstanding any rule of law to the contrary, it shall be lawful for the General Council of the Bar (in this section referred to as "the Council") to make rules or regulations (in this section referred to as "subscription regulations") requiring any person who acts or intends to act as a barrister to pay to the Council such subscription as the Council may require.
(2) A person who has been called to the Bar by an Inn of Court shall, if he would not otherwise be taken to be acting as a barrister, be taken for the purposes of this section to be so acting if he is (with or without others)—

(a) supplying or offering to supply legal services to the public or a section of the public;

(b) whilst acting in the course of any employment, supplying legal services—

(i) to his employer,

(ii) to another employee of his employer,

(iii) where his employer is an association, to any member of that association, or

(iv) where his employer is supplying or offering to supply services to the public or a section of the public, to any customer or client of his employer;

(c) exercising or seeking to exercise any right of audience granted by the Council;

(d) employed as an advocate within the meaning of section 31A(3) of the Courts and Legal Services Act 1990.

(3) Without prejudice to the generality of the foregoing, but subject to section 31A of the Courts and Legal Services Act 1990, subscription regulations may—

(a) impose different requirements—

(i) for persons who have been called to the Bar for different periods of time, or

(ii) for persons seeking to act as barristers in different modes or forms of practice;

(b) provide that failure to pay the whole or any part of any subscription required to be paid by a person who acts or intends to act as a barrister shall—

(i) constitute professional misconduct, and

(ii) entitle the Council to take such steps as it thinks appropriate with a view to that person being disbarred, or temporarily suspended from practice, by order of an Inn of Court.

(4) Where a person who acts or intends to act as a barrister has failed to pay the whole or any part of any subscription required to be paid by him in accordance with subscription regulations the unpaid part thereof shall be recoverable by the Council by action in the County Court as if the same were a debt owing by that person to the Council.").
The noble Lord said: The noble and learned Lord the Lord Chancellor said at the beginning of his reply to the previous amendment that he detected the footprints of the Bar Council all over it. The noble and learned Lord may note exactly the same footprints on this amendment. He would be absolutely right, but the amendment is none the worse for that. The purpose of the amendment is to put the Bar Council on the same footing as the Law Society and the Council of Licensed Conveyancers. The Law Society can require anyone who wishes to conduct litigation or advocacy as a solicitor to pay a fee for the issue of a practising certificate under Section 11 of the Solicitors Act 1974. The fee is not confined to a sum that covers the
1230
administrative cost of issuing the certificate. Section 11 specifically provides that it can be used for the general purposes of the society. Under Section 14 of the Administration of Justice Act 1985 the Council of Licensed Conveyancers is entitled to charge fees for the issue of an annual licence to practise. I am not sure about ILEX which is not a statutory body, but it may well have power to charge an annual fee to members by way of a contract between itself and those members.
The Bar Council cannot under the present law charge fees. About 10 per cent. of barristers in independent practice do not pay the fees requested by the Bar Council. The reason why that body is unable to charge fees is purely historic. Entry to the Bar was governed by the Inns of Court long before the Bar Council existed. The Inns rather than the Bar Council were the bodies who provided qualifications for entry and for a long time were responsible for the discipline of members of the Bar. Certainly for a very long time the Law Society—I am not sure about its early history—has had statutory responsibility for admission to the roll of solicitors, the issue of practising certificates and the discipline of members of the profession. Those are all public functions.
For members of the Bar, the equivalent functions have now very largely passed from the Inns of Court to the Bar Council. Although the Inns formally call members to the Bar, rules about the education and training needed to qualify for practice are made by the Bar Council. The Bar Council is responsible through its professional conduct committee for the discipline of barristers and making and altering the Bar's code of conduct. The Bar Council can and does require any barrister in independent practice to pay a premium for professional negligence insurance to the Bar's own mutual insurance company, of which I was for some years a director. None of that money goes back to the Bar Council.
The Bar Council, like the Law Society, is an authorised body under the Courts and Legal Services Act. As such an authorised body, it has public functions. For the performance of those functions it requires money. The Bar Council performs some trade union functions on behalf of the Bar, as does the Law Society on behalf of the solicitors' branch of the profession. That is not inconsistent with a requirement of the payment of fees as a condition of the right to practise.
The Bar Council has been and will increasingly be handicapped by the fact that it cannot compel payment of charges from its members for the public services that it provides. It is anomalous that it cannot require payment of its own charges, while it can require payment of premiums to its insurance company. It is anomalous that it cannot require payment of fees when the Law Society and the Council for Licensed Conveyancers can. I believe that the time has come to remedy those anomalies and to give the Bar Council power to charge fees for members wishing to exercise rights of litigation or rights of audience. I beg to move.
Lord Hacking: I wish to support this amendment. As a member of the Bar for some 15 years, who always paid his dues to the Bar Council, and as a solicitor of

1231
the Supreme Court for the ensuing years of my 35 years of practice, I have been under statutory obligation, but nonetheless I have been willing to pay the fees.
The position has greatly changed since I was called to the Bar in 1963 when the Inns of Court exercised all sorts of jurisdiction over discipline, education and so forth. The Bar Council is now in a position almost akin to the Law Society. The only question I would raise is whether it is necessary. If it is necessary to put such a matter into the statute, clearly it is right that the Bar Council should have the right to collect fees for the public services that it provides in education, training and so forth.
Lord Goodhart: Before the noble Lord sits down, I should add that the Bar Council, as I understand it, has been advised that it has no power to charge fees, to take disciplinary proceedings or to take any other action against members who do not pay its charges.
The Lord Chancellor: Your Lordships have heard the eloquent speeches made by the Bar Council's many able advocates in this House and outside it, in which they have protested how unreasonable, how unconscionable, how unconstitutional it is for the Government to have dared to promote legislation interfering with rights of audience, and how this threatens the fragile independence of the Bar and risks tumbling our entire constitutional settlement around our ears. We had 60 minutes' worth of it when the noble and learned Lord, Lord Ackner, opposed that Clause 31 stand part of the Bill.
At least, that is the argument when the Bar thinks that its privileges arising from its rights of audience are under threat. How interesting it is to see the position when the boot is on the other foot. The delicate subject of how the Bar can force its recalcitrant members to pay their subscriptions is one on which, as a Member of the Government, far less as Lord Chancellor, I would hardly dared to have ventured an opinion, but for this amendment. This question is apparently not so intimately connected with the Bar's traditions of independence and self-regulation that it would not benefit from parliamentary intervention.
The reason such an amendment is desired is that in 1990 the noble and learned Lord, Lord Nolan, sitting in the Bar Disciplinary Tribunal, decided that Bar rules purporting to make the non-payment of subscriptions a matter of misconduct were ultra vires and unenforceable. Subsequently, the noble and learned Lord the Lord Chancellor and the designated judges refused an application under the 1990 Act to approve changes in the Bar's rules designed to re-introduce compulsory subscriptions. They did so on the grounds that the Bar Council had no power to make or enforce such rules. That explains the reference in the amendment to,
"notwithstanding any rule of law to the contrary".
As has already been pointed out, the Law Society is in effect already able to levy compulsory subscriptions by charging for the practising certificate which all practising solicitors must obtain. Therefore I do not
1232
consider that it is necessarily objectionable in principle for the Bar Council also to be able to levy compulsory subscriptions on practising barristers.
There are, however, difficulties. Both the Bar Council and the Law Society are hybrid bodies which combine regulatory functions with—they may not like the description—trade union functions. As the Committee will recall, the enforcement of trade union closed shops is contrary to the right of freedom of association which is enshrined in the European Convention on Human Rights, newly incorporated, as the noble Lord, Lord Goodhart, was kind enough to recall, into our domestic law under a Bill which I had the privilege of introducing and carrying through this House. Compulsory adherence to a state regulatory body subject to public law is, however, permissible.
Although the Bar Council exercises certain statutory regulatory functions in respect of rights of audience under the Courts and Legal Services Act 1990, it is not a statutory body and its other functions are not statutory. In that it differs from the Law Society, which is the statutory regulatory body for the solicitors' profession, under the provisions of the Solicitors Act 1974.
Another difference between the two bodies is that while all practising solicitors are subject to regulation by the Law Society and must obtain and pay for practising certificates from the society, it is possible for them to opt out of membership of the society and out of its trade union functions. Some solicitors do this as a matter of principle or for their own reasons, even though membership is free to solicitors with a current practising certificate. No such option is available to barristers under the amendment which has been moved.
The fee which the Law Society can charge for a practising certificate is a statutory fee determined under Section 11 of the Solicitors Act by the Master of the Rolls with the concurrence of the Lord Chancellor and Lord Chief Justice. I do not think that the Bar Council has proposed any similar mechanism in relation to its own fees.
There must also be other questions about the Bar Council's suitability to receive a compulsory levy from all banisters. As presently constituted, the Bar Council is, for example, very unrepresentative of employed barristers who make up a significant proportion of the profession as a whole. Some Members of the Committee may have read recently in the Lawyer the comments of Susan Ward, the chairman of the Bar Association for Commerce, Finance and Industry, when asked about this amendment. She said:
"BACFI doesn't have a problem with compulsory subscriptions, providing the Bar Council stops using subscription income to fund campaigns to denigrate employed and non-practising barristers, and starts looking after our interests".
I have some sympathy with her. I would need some persuasion that the Bar Council does a good job, or even seriously attempts to do a good job, of representing the many barristers who are not in private practice.
As drafted, the amendment would appear to require former barristers who have become solicitors, and those barristers who are regarded by the Bar as non-practising barristers and who can only provide those services

1233
which any member of the public can provide, to pay subscriptions to the Bar Council. I am moved to wonder what service they are to receive in return for their subscriptions.
To sum up, while I do not reject the principle of compulsory subscriptions to the Bar, I believe that all these difficulties and questions would need to be resolved before your Lordships would agree to an amendment of the kind that has been moved.
On a more encouraging note, my department is already discussing the issue with the Bar Council and I certainly undertake to consider it further and to consult interested parties and my colleagues in government. I hope that it will be possible to resolve the issue during the passage of the Bill through Parliament. However, I cannot undertake to return to the House on Report with a government amendment. I hope that on that basis the noble Lord will agree to withdraw the amendment.
10.15 p.m.
Lord Goodhart: I am grateful to the noble and learned Lord the Lord Chancellor. The Bar Council was seeking a change in the law by primary legislation to which, as I have pointed out on several occasions today, it has no objection. At this time of night I shall not seek to attempt to reply to the various points made by the noble and learned Lord, although there are replies to be made to a number of them. Having regard to his comment about the possibility of further action being taken before the Bill is enacted and takes it final form, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 37 agreed to.
Schedule 6 [Rights of audience and rights to conduct litigation: amendments]:
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 290A:
Page 72, line 34, leave out from ("for") to end of line 37 and insert ("the words from ", the Lord Chief Justice" to the end substitute "approves any regulation such as is mentioned in subsection (1), the requirement of the concurrence of the Lord Chief Justice and the Master of the Rolls imposed by that subsection shall not apply.'").
The noble and learned Lord said: These amendments are minor drafting amendments to Schedule 6. The first two are made at the request of my noble and learned friend the Master of the Rolls who I am glad to see in his place. They are somewhat technical in nature, and concern rules of the Law Society which require concurrence by certain members of the judiciary under the Solicitors Act 1974. Most of these rules will also require approval under the Courts and Legal Services Act 1990.
Clearly it is not in anyone's interest that the same rule should have to be approved twice under two different Acts, and so the principle which applies is that when a rule has been approved under the 1990 Act it is deemed also to have been concurred to under the 1974 Act. This principle is currently enacted in Sections 2(4) and 31(3) of the Solicitors Act, as amended by the Courts and Legal Services Act.
Section 2 of the Solicitors Act relates to education and training rules for solicitors. These require the concurrence of the Lord Chancellor, the Lord Chief Justice and the Master of the Rolls, which is deemed to have been given if the rule has been approved under the 1990 Act. Section 31 relates to practice rules, which require the concurrence only of the Master of the Rolls; this, too, is deemed to have been given if the rule has been approved under the 1990 Act.
Schedule 6 updates these provisions to reflect the fact that under the provisions of the Courts and Legal Services Act, as amended by this Bill, rules will be approved by the Lord Chancellor alone, after considering the advice of the designated judges, and not by the Lord Chancellor and designated judges acting together. Schedule 6 currently provides that in these circumstances the Lord Chief Justice and Master of the Rolls, or the Master of the Rolls alone, according to the type of rule, will be deemed to have concurred to the rule.
My noble and learned friend Lord Woolf suggested at the Second Reading debate that he would prefer not to be deemed to concur to a rule if he has not actually done so. That seems eminently sensible. Accordingly, Amendments Nos. 290A and 290B provide that where a rule has been approved under the 1990 Act, the requirement for concurrence under the 1974 Act shall not apply.
The last of this group of amendments, Amendment No. 291A, is another technical amendment which will correct the definition of a "right to conduct litigation" in Section 119 of the 1990 Act. That right is currently defined as the right:

"(a) to exercise all or any of the functions of issuing a writ or otherwise commencing proceedings before any court; and

(b) to perform any ancillary functions in relation to proceedings (such as entering appearances to actions)".

Paragraph 10(3) of Schedule 6 amends that definition to reflect the fact that it is possible to have rights which one cannot exercise. The relevant part of the new definition would therefore provide that a right to conduct litigation is the right to issue a writ or otherwise commence proceedings before any court. However, the Civil Procedure Rules 1999, which will come into force on 26th April this year, will abolish the commencement of proceedings by writ. This amendment therefore deletes that part of the definition to reflect the new state of affairs which will prevail by the time this Bill is passed, if Parliament chooses to pass it. I beg to move.
Lord Woolf: I merely wish to record my gratitude to the noble and learned Lord and the noble and learned Lord the Lord Chancellor for being so responsive to my sensitivities.
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 290B:
Page 72, leave out lines 40 to 42 and insert ("the words from "Master of the Rolls" to the end substitute "Lord Chancellor approves any rule such as is mentioned in subsection (1), the requirement of the concurrence of the Master of the Rolls imposed by that subsection shall not apply."").
On Question, amendment agreed to.
[Amendment No. 291 not moved.]
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 291A:
Page 73, line 46, leave out ("a writ or otherwise commence").
On Question, amendment agreed to.
Schedule 6, as amended, agreed to.
Clause 38 [Permission to appeal]:
Lord Kingsland Lord Kingsland moved Amendment No. 292:
Page 21, line 16, after ("that") insert (", except in cases relating to the civil rights and safety of the person,").
The noble Lord said: In moving this amendment, I shall speak also to Amendment No. 294. The Opposition support in principle the introduction of an extension of the requirement for leave to appeal to discourage unmeritorious appeals which take up too much time of the courts and add to the costs of litigation, including for the ultimately successful party.
The success rate of appeals, particularly in the Court of Appeal, is significantly higher in circumstances where leave to appeal is currently required. Also, the present rules on leave to appeal are rather complex and difficult for the Court Service, let alone the parties, to understand. But there should be exceptions to the requirement for leave to appeal because, inevitably, that adds an extra step and takes time, especially if leave is not immediately given by the trial judge and a separate application must be made at a later stage to that judge or a more senior judge.
The only exception to the universal requirement of leave to appeal on the face of the Bill is in relation to criminal cases. But the liberty and safety of individuals and their ability to exercise their civil rights, such as freedom of movement and freedom of expression, are issues in many civil cases such as those involving asylum seekers, domestic violence or harassment injunctions. The universal requirement for leave to appeal may also not comply with the European Convention on Human Rights.
I accept that it is not appropriate in primary legislation to include in great detail all the specific categories of case for which an automatic right to appeal should be permitted. But at least the basic principles should be enshrined therein.
Amendment No. 294 would enable a party wishing to appeal a decision who was refused permission to appeal by the first instance judge to renew the appeal before the Court of Appeal. In many cases, the parties, especially those involved in lower value claims or litigants in person, will need a little time to reflect on the outcome of the trial and the first instance judgment before deciding whether an appeal is merited. Frequently it is simply not practical to apply to the trial judge after the event, especially on circuit where the judge may not be at that court until some weeks or even some months later. There will also be a few cases where the first instance judge may be reluctant or unwilling to give permission for an appeal, even when this would be the right course of action, because it could be seen to reflect adversely on his abilities.
A very important function of the Court of Appeal is to take an overview of the justice system and decide points of principle and resolve test cases. If the automatic right to appeal is to be significantly restricted it is vital that decisions granting permission to appeal should not remain the province only of the first instance judges. Losing parties should have the right to appeal for leave directly to the Court of Appeal. I beg to move.
Lord Goodhart: Two of the amendments in this group are in my name, Amendments No. 293 and 295. Speaking first to Amendment No. 293, there should clearly be an absolute right of appeal against the deprivation of liberty. I have to assume that the absence therefore of any reference to an automatic right of appeal where there has been a committal to prison for contempt of court is an oversight. If not, that is a point that should certainly be re-considered urgently.
Amendment No.295 raises a different point which is somewhat akin to that raised in Amendment No.294. It is that there should always be someone other than the judge who decided the case who can give leave to appeal. The judge who decided the case should of course be entitled to give leave but, if he or she refuses it, there must be some other judge to whom a further application for leave can be made. I remember one judge, now dead—indeed he was a former head of my chambers—who never suffered the slightest doubt about the correctness of his decisions. It was therefore very difficult to extract from him leave to appeal in cases where leave was needed, but counsel in such a case could always go to the Court of Appeal to get leave. It is surely wrong that one person should both make the decision and then have the sole power to decide whether leave to appeal from that decision should be given.
Lord Woolf?: Perhaps I may say just a few words about the provisions of Clause 38. As the Committee will appreciate, the provisions of this part of the Bill are largely derived from the Bowman Report. The purpose of the Bowman Report was to ensure that the Court of Appeal could provide a service in the interests of justice which met the needs of litigants more efficiently and effectively than it does at present.
The present amendment deals with Clause 38. I would draw attention to the fact that this is to be subject to the rules of court. As the Committee will again be aware, there is a Rules Committee, of which I have to confess I am chairman, which looks at these matters with great independence and care. In practice that committee is best able to judge what restrictions should be made with regard to the general requirement of leave to appeal.
In principle I am not concerned about the amendments which are proposed except for Amendment No. 292. If the noble Lord, Lord Kingsland, would forgive me for doing so, I would suggest that the wording he is proposing there is dangerously wide. Some litigants would say that whenever they come to court they are exercising their civil rights. Safety of the person is also a worrying requirement. Some would say that every Factories Act case involves the safety of the person. It seems to me that that proposal would drive the proverbial coach and horses through what is being

1237
proposed. I would urge that, rather than put that restriction on the Rules Committee, your Lordships should have confidence that it would of course protect such things as the liberty of the subject, which I think is probably what the amendment is designed to protect.
10.30 p.m.
Lord Falconer of Thoroton: There are four amendments in this group and they all relate to Clause 38. As the noble and learned Lord, Lord Woolf, said, the purpose of Clause 38 is to introduce a rule-making power which can be used to provide that permission must be granted before an appeal can proceed in the county courts, the High Court or the Civil Division of the Court of Appeal. Perhaps I can deal with each amendment shortly.
First, Amendment No. 292 purports to make an exception for the rule-making power to apply to,"
"cases relating to the civil rights and safety of the person".
The noble and learned Lord, Lord Woolf, made the point much more eloquently than I could about the extraordinary width and therefore the propensity for confusion that comes from the proposed amendment. It would give rise to difficulties for both practitioners and judges in establishing whether or not leave would be required. Sir Jeffrey Bowman, whose review team the noble and learned Lord, Lord Woolf, referred to in his short remarks—the exact words include,
"examine the workings of the Court of Appeal"
and whose report forms the basis for Clause 38, recommended that there should be a leave requirement for virtually all cases, in part because of the propensity for confusion and difficulty among practitioners as to which cases do and which cases do not require leave. Also, if we included such a provision—again for the reasons indicated by the noble and learned Lord—such an amendment would seriously detract from the aim of Clause 38 because it would bring in so many cases.
The purpose of a requirement for permission is to provide a filter to ensure that only those cases where there are justifiable reasons for questioning the first instance decision are able to proceed to an appeal. Weak appeals not only take up valuable court time, but also delay a litigant from receiving the benefit of any judgment to which he or she is entitled. The fact that a case falls into a specific category does not in itself guarantee that the appeal is a meritorious one. That is why it is vital to introduce a rule-making power which will allow a requirement for permission to appeal to be introduced at all levels of the court system. I should make it clear that I believe that there are certain restricted circumstances where it is important for a right of appeal to be automatic.
Amendment No. 293 deals with the position in relation to appeals against orders of committal for contempt of court. In a consultation paper which the Lord Chancellor issued on extending the requirement for permission to appeal to the Court of Appeal, he proposed that there should continue to be an automatic right of appeal in cases where the liberty of the individual was at stake—this was also referred to by the noble and learned Lord. Following
1238
the consultation exercise, rules were introduced on 1st January of this year to provide that permission would be required for all appeals to the Court of Appeal, with the exception of appeals against the making of a committal order, against a refusal to grant habeas corpus or against an order for secure accommodation under Section 25 of the Children Act 1989—all provisions which relate to the liberty of the subject.
In the consultation paper which the Lord Chancellor issued on the proposals before the Committee, he indicated that the requirement for permission to appeal should be extended to cover all types of cases in the High Court and county courts, with the exception of appeals in cases involving the loss of an appellant's liberty. However, there may well be other areas which it would be advisable to exempt from requiring permission to appeal. I understand the concern, for example, that in some interlocutory orders a requirement for permission may result in unnecessary delay because in the time it takes for a judge to hear the application for permission, he or she might just as easily consider the substantive appeal.
In my view, the listing of such exceptions is best suited to Rules of Court rather than to an Act of Parliament. It is for that reason that I resist the amendment tabled by the noble Lords, Lord Goodhart and Lord Thomas of Gresford. The effect of the amendment has already been achieved within the Court of Appeal through the Rules of Court. It is the Lord Chancellor's intention to replicate the situation in the lower courts. Provisions describing when permission is required have hitherto been dealt with by rule, and I see no reason why that should not continue to be the case.
I turn to Amendment No. 294. I entirely agree the principle that where a court which has made a first instance decision refuses an application for permission to appeal that decision, it should be possible for a litigant to renew his application to a higher level of judge. However, the appropriate venue for consideration of that application is the tier of court which will actually hear the appeal if the application is successful. Under the proposed reforms, this will not necessarily be the Court of Appeal.
The effect of the proposed reforms to the jurisdiction of the Court of Appeal will be that some appeals previously determined by that court will be determined by the lower courts. That reflects the need for proportionality in our appellate system.
As the noble and learned Lord has said, these proposals came about following the Bowman Review, which was commissioned by the noble and learned the Lord Chancellor's predecessor—who I see in his place—against the background of an increasing number of applications and appeals and consequent delays in the hearing of appeals. The review team concluded that the Court of Appeal was being asked to deal with cases which were not sufficiently weighty or complex to require the attention of the country's most senior judiciary. The noble and learned Lord the Lord Chancellor therefore sought to include proposals in the Bill to enable him to draw away from the Court of Appeal those cases which do not need to be heard there.
I shall give an example. Currently, virtually all appeals from a circuit judge lie to the Court of Appeal. If an application for permission made to the court of first

1239
instance were to be refused, it would be renewable to the Court of Appeal. Under the new system, cases in the new fast track, heard at first instance by a circuit judge, would be appealable to a High Court judge. In these circumstances, where an application for permission is refused by the court of first instance, any renewed application would fall to be considered by the appellate court, that is, the High Court.
The effect of Amendment No. 294 would be to require every application for leave to appeal which is refused at level one, to be renewed to the Court of Appeal, which obviously is not in line with the proposals in relation to the new appeal system.

I should stress, however, that provisions are included in the Bill which will ensure that those cases which do merit the consideration of the Court of Appeal are able to reach that court. That might be by way of a second appeal to that court under Clause 39.
Finally, I turn to Amendment No. 295, which I think I have already dealt with. This amendment provides that rules made in pursuance of subsection (3)(b) may not provide that permission may be given only by the court which made the decision or order from which permission to appeal is sought. Once the principle is accepted that if leave is refused at tier one the application can be renewed to tier two, the point made in Amendment No. 295 is dealt with.
In those circumstances, I believe that every one of the points raised is adequately dealt with under the existing system. I therefore ask the noble Lord to withdraw the amendment.
Lord Goodhart: Before the noble Lord, Lord Kingsland, replies, perhaps I may say that I am a little disappointed that it is not on the face of the Bill that there will be an automatic right of appeal in non-criminal proceedings which involve the liberty of the subject. However, I do not propose to press the amendment further. In saying that, I have regard to the fact that I strongly suspect that any change in the rules, which deprived anybody of existing rights in such a case to make an appeal could well be contrary to the European Convention.
Lord Kingsland: I give the noble and learned Lord at least five out of 10 for his spirited response. I thank him very much indeed for the way he replied. I should like to reflect on what he said and perhaps come back on Report with some renewed amendments which will seek to reflect more accurately the underlying philosophy which he explained so well. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 293 to 295 not moved.]
Clause 38 agreed to.
Clause 39 [Second appeals]:
Lord Phillips of Sudbury Lord Phillips of Sudbury moved Amendment No. 295A:
Page 22, line 5, leave out from ("and") to ("no") in line 6 and insert ("if that first appeal is unsuccessful,").
The noble Lord said: My noble friend Lord Meston has asked that I say a few words in his stead as he was unfortunately taken ill this afternoon. In moving this amendment, I should point out that I shall speak also to Amendment No. 295B. My noble friend's amendment deals with the situation of a second appeal, which is being made by the party who won at first instance. Clause 39, as drawn, makes no distinction between the appellant for whom it is the first appeal and the appellant for whom it is the second appeal; namely, the appellant who won at first instance and wishes to appeal against the success of his opponent in the first appeal and, on the other hand, the party who failed at first instance, failed on appeal and then seeks a second appeal. We believe that there is reason and justice in making a distinction between the two cases. It is for that purpose that Amendment No. 295A proposes to insert the words,
"if that first appeal is unsuccessful".
Perhaps I may move on to Amendment No. 295B. It is designed to mitigate what we think is perhaps an unnecessary rigor in requiring as the alternative test to be satisfied, if there is to be a second appeal, the requirement that some "special reason" should be relevant to the case. We believe that it would be adequate if the test were that "there is sufficient reason". It is simply a question of finding a fair balance between the need, on the one hand, to control second appeals and, on the other, not to be too harsh in allowing that prospect. I beg to move.
Lord Clinton-Davis: When I observed the term "special reason", my mind went right back to special reasons in relation to suspensions of licences or disqualifications in driving cases. There is a risk that a new body of jurisprudence could be collected around this term. I am not totally convinced that the word "sufficient" is right, but I invite my noble and learned friend to give consideration to a suitable substitute for "special reason". I really do have some anxiety about that term.
That was the point I was proposing to make in debating the Question of whether Clause 39 should stand part of the Bill. Therefore, provided that my noble and learned friend is as flexible as he has shown himself to be throughout most of our proceedings on the Bill—leaving aside some of my amendments which he has rejected and where he has shown a degree of inflexibility—I do not think that I need to revisit such matters at this point. Nevertheless, I await with interest to hear what either of my noble and learned friends have to say in response.
Lord Kingsland: I am speaking to Amendment No. 296, which is included in this group. My amendment would enable the Court of Appeal to be the final arbiter as to whether an appeal in a particular case should exceptionally be permitted to lie to more than one level of court. Clause 39 would limit appeals to one bite of the cherry only, unless the case fell in on the exceptions outlined in either paragraph (a) or (b); that is to say, either the appeal would raise an important point of principle or practice, or there is some other special reason for the appeal to be made. This would mean that generally, even where leave to appeal is granted, an appeal from a district judge would only be heard by a circuit judge and an appeal from a High Court master would lie only to a High Court

1241
judge. In both cases there would be no second appeal to the High Court in the first instance or to the Court of Appeal in the second instance.
While in many cases one level of appeal is certainly sufficient, the most appropriate judge to hear that appeal may not always be the next, most senior, in the system. That will particularly be the case following the introduction of the civil justice reforms this spring, because the district judges in the county courts will be responsible for the case management and trials of the lower value claims to be allocated under the new fast track. Circuit judges are likely to have limited experience of the day-to-day operation of the very new civil procedure rules. Therefore restricting a party's right of appeal to a district judge's decision—perhaps on such a vital matter as to whether the claim might be struck out to a circuit judge, who may be primarily a criminal law specialist—and preventing any further appeal either to the High Court or the Court of Appeal could lead to substantial injustice.
One of the important tasks of the Court of Appeal is to take an overview of the justice system and to decide test cases and other cases which clarify or expand the law. It is the Court of Appeal therefore that is best placed to take decisions on key issues arising from the implementation of the civil justice reforms. Therefore parties should have the right to invite the Court of Appeal to decide whether their case should be restricted to only one level of appeal, and which court should hear that appeal.
10.45 p.m.
Lord Woolf: The statements which have been made by Members of the Committee with regard to Clause 39 are ones with which I have considerable sympathy and understanding. Indeed with regard to the use of the word "special" I must, on behalf of the Bowman Committee, of which I was a member, plead guilty because we recommended that the word "special" should be inserted.
I am afraid it may be too long a time since I myself had the responsibility of urging special reasons before a magistrates' court. But the word "exceptional" appeared in a recent Act of Parliament, the Crime (Sentences) Act 1997, which provided that in certain circumstances an individual could be subjected to life sentences unless there were exceptional circumstances. At the end of last year the noble and learned Lord the Lord Chief Justice had to deal with that phrase. The fears that have been expressed tonight were certainly confirmed by the judgment in that case. It is interesting to note that the noble and learned Lord the Lord Chief Justice used the word "special" in substitution for "exceptional" in describing, as far as he could, what was meant by "exceptional". That seems to me to underline the danger referred to.
It is always difficult to decide what is the appropriate reason. The Court of Appeal judges have given some consideration to this matter and what we would offer to the Committee as a suitable substitute is the word "compelling". With regard to the whole purpose of the second appeal provision in Clause 39, the position at
1242
present is that if a case is decided by a district judge, one has two rights of appeal. One has first of all a right of appeal to a Court of Appeal judge, which is a rehearing—the whole case is tried over again in other words—and then one can go to the Court of Appeal.
The reason for Clause 39 is to limit the cases which can come to the Court of Appeal to the ones which my noble friend Lord Kingsland had in mind—to which he referred—that is, ones where the Court of Appeal could exercise its function of first of all dealing with important points of principle and practice and also acting as a safety valve so as to ensure that no compelling injustice, as I would say, was done. I hope that in considering whether to accept the proposed amendments, the noble and learned Lord the Lord Chancellor will take into account those considerations.
Lord Falconer of Thoroton: Clause 39 enshrines the principle put forward by Sir Jeffery Bowman's review team: that, broadly, there should be only one level of appeal. It also enshrines the principle outlined in the Bowman Review that there should be some exceptions to that. It encapsulates the exceptions as being: unless the appeal would raise an important point of principle or practice; or, that there is some other special reason for the appeal to be made.
These three amendments seek to amend the circumstances in which there may be a second appeal. The first, tabled by the noble Lord, Lord Meston, but argued very effectively by the noble Lord, Lord Phillips, suggests that a matter should only be limited to one level of appeal where the first appeal upholds the decision of the court of first instance. The effect of the amendment would be that if it overturned the decision of the first court, the matter would be free from the restriction of one appeal only.
With great respect, we are not attracted to that suggestion. We do not believe that our justice system should be predicated on the assumption that the decisions of the lower courts are wrong. When an application for permission to appeal is granted, the assumption should be that the Appeal Court has rightly confirmed or corrected the decision of the first instance court. Where a flawed decision at first instance is clearly put right on appeal, a further appeal would not be appropriate. Therefore, an overturned decision should not in itself provide a statutory exemption to the principle of one level of appeal. I accept that provision needs to be made for those cases where, for example, it would appear that an appeal court has reached an incorrect decision.
The second suggested amendment, Amendment No. 295B, deals with the word "special". It is proposed that the word "special" in sub-paragraph (b) should be replaced with the word "sufficient". The noble and learned Lord, Lord Woolf, has indicated that he also has concerns over the use of the word "special". He suggests that we use the word "compelling".
At the present time, the Lord Chancellor is attracted to the substitution of the word "special" with the word "compelling". He considers that it provides an appropriate indication of the circumstances in which

1243
there should be a further appeal. It would ensure that, where the individual circumstances of a case merit the consideration of the Court of Appeal in the way described, it will be possible for it to proceed further, regardless of whether the Appeal Court has overturned or upheld the first instance decision. In my view, that addresses the concerns reflected in Amendment No. 295A.
The effect of Amendment No. 296 is to provide that, where a party wishes to appeal a case that has already been through one appeal, he is able to apply to the Court of Appeal for that court to decide whether or not the appeal would raise an important point of principle or practice, or whether there is some other special reason for the appeal to be made.
It has always been my intention that, where a party seeks permission for a second appeal, the application should be made to the Court of Appeal. I intended that that should be provided for by use of the rule-making power set out in Clause 38(3)(b). The Lord Chancellor is, however, prepared to consider whether there might be a case for specifying that in primary legislation.
In conclusion, I urge the Committee to resist Amendment No. 295A, moved by the noble Lord, Lord Phillips. However, if the noble Lord is willing to withdraw Amendment No. 295B, the Lord Chancellor will undertake to return to him on this point when we report back to the House. Similarly, if the noble Lord, Lord Kingsland, is willing to withdraw his amendment, the Lord Chancellor will consider whether he can put forward an amendment which will achieve its aim. On that optimistic note, I ask the noble Lord to withdraw the amendment.
Lord Phillips of Sudbury: I am grateful to the noble and learned Lord and am perfectly content for the matter to proceed on that basis. I thus beg leave to withdraw this amendment and shall not move Amendment No. 295B.
Amendment, by leave, withdrawn.
[Amendments Nos. 295B and 296 not moved.]
Clause 39 agreed to.
Clause 40 [Power to prescribe alternative destination]:
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 296A:
Page 22, leave out lines 33 and 34 and insert—

("(c) the President of the Family Division, and

(d) the Vice-Chancellor.").

The noble and learned Lord said: This is a minor drafting amendment. I beg to move.
The Lord Chancellor: This amendment is grouped with Amendment No. 297, but the noble and learned Lord has spoken only to Amendment No. 296A.
I am grateful to him for proposing the amendment. It simply seeks to ensure that the correct order of precedence of the Heads of Division is reflected in Clause 40. That is in accordance with the order of
1244
precedence set out in Section 13 of the Supreme Court Act 1981. I am happy, without saying more, to accept the amendment.
On Question, amendment agreed to.
Clause 40, as amended, agreed to.
Clauses 41 to 43 agreed to.
Lord Mackay of Clashfern Lord Mackay of Clashfern moved Amendment No. 297:
After Clause 43, insert the following new clause
("Vice-President of the Queen's Bench Division

VICE-PRESIDENT OF THE QUEEN'S BENCH DIVISION
. After section 5(1) of the Supreme Court Act 1981 (Divisions of High Court) insert—
"(1A) The Lord Chancellor may appoint one of the ordinary judges of the Court of Appeal as Vice-President of the Queen's Bench Division, and a judge so appointed shall he a judge of that Division.'').
The noble and learned Lord said: In these days the work of the Lord Chief Justice of England is a heavy burden. When my noble and learned friend Lord Lane was Lord Chief Justice he sought the assistance of Lord Justice Tasker Watkins over the whole field of his activities. After some negotiation, we were able to propose an arrangement under which Lord Justice Watkins became the Deputy Chief Justice.
When my late learned friend Lord Taylor of Gosforth became Chief Justice he felt that the arrangements were a little lacking in flexibility. He wished to have somewhat different arrangements. In particular, he wished Lord Justice Kennedy to assist him in the disposition of the Queen's Bench Division judges. That is a major task because, as the Committee knows and as the noble Lord, Lord Thomas of Gresford, explained to us the other day in answer to the point about returns, one can never be sure how long cases will last. Therefore, we need to have someone on hand to ensure, so far as possible, that there is a judge available for the next case when a problem arises.
When my noble and learned friend Lord Bingham of Cornhill became Lord Chief Justice, it was the understanding that he would be willing to sit in all the jurisdictions which the Lord Chief Justice can occupy; namely, the Criminal Division of the Court of Appeal, the Civil Division of the Court of Appeal—to which he was no stranger, having been the Master of the Rolls—as well as the Divisional Court, and sitting in the Crown Court at first instance from time to time. That was just to get the sense of what happens at the trial level. One thing that tends to happen as one gets older and is promoted in the English system and goes to the Court of Appeal Criminal Division is that one gets less sense of what is going on in trials.
In passing, I must say that the Scottish system ensures for the most part that even the most senior judges have to preside at trials. My noble and learned friend the Lord Advocate will confirm that. It means that the judgments of the Court of Appeal on criminal matters in Scotland are closely related to the circumstances of the time.
The result was that my noble and learned friend Lord Bingham felt that there was scope for appointing one of the Court of Appeal judges to be vice-president of the Criminal Division of the Court of Appeal. There is a statutory provision for that in the Supreme Court Act and he appointed Lord Justice Rose, who now specialises in criminal matters and sometimes spends time in the Divisional Court. However, his main work is in the Criminal Division. That appears to me to be satisfactory.
On the other hand, there was no statutory place for Lord Justice Kennedy, but it was agreed, when I was still in office and the new Lord Chief Justice was appointed, that Lord Justice Kennedy would be de facto the vice-president of the Queen's Bench Division. When a suitable opportunity arises, as I believe it now has, I suggest that it should be made a statutory provision.
I have simply used the terms at present in place for the vice-president of the Civil and Criminal Divisions of the Court of Appeal and applied them here. I understand that there may be further refinements required to make the amendment absolutely in accordance with the high standards of drafting which my noble and learned friend the Lord Chancellor requires. But in the meantime, the principle is clear enough. I beg to move.
11 p.m.
The Lord Chancellor: It is of course only appropriate that my noble and learned predecessor should call the Committee's attention to the matters in which the Scots judges are so much better informed.
As the noble and learned Lord said, the purpose of his amendment is to empower the Lord Chancellor to appoint one of the judges of the Court of Appeal to act as Vice-President of the Queen's Bench Division. As the noble and learned Lord has explained, this would give formal recognition to an informal practice of several years' standing by which one of the Lords Justices gives the Lord Chief Justice support with the judicial administration of the division—and certainly such support is required.
I am happy to accept this amendment in principle because I too believe that these informal appointments should have statutory underpinning at the earliest opportunity.
The noble and learned Lord knows that his amendment is insufficient—I would not dare to say technically defective—in that a number of consequential changes are also required. For example, because the office is to be held by a member of the Court of Appeal, it will be necessary to amend the Supreme Court Act to add the Vice-President of the Queen's Bench Division to the list of members of the High Court. We shall also need to amend the long title of the Bill.
However, if the noble and learned Lord is content to withdraw his amendment, he can be assured that I will bring forward amendments at Report stage to achieve the intended effect.
Lord Mackay of Clashfern: I am of course entirely content to withdraw this amendment in order that the
1246
technical support for it can be forthcoming. I should have said that my noble and learned friend the Lord Chief Justice also supports this amendment, as is manifest from his name on the Marshalled List. I am very content and thank the Lord Chancellor for supporting the principle of this amendment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clauses 44 to 48 agreed to.
Lord Kingsland Lord Kingsland moved Amendment No. 298:
After Clause 48, insert the following new clause—
("Alteration of listing

COMPENSATION FOR UNREASONABLE ALTERATION IN TIME AND DATE OF HEARING
. Where a civil court has allocated a fixed time and date for a hearing or trial, but fails in the event to honour that commitment, without giving reasonable prior notice to the parties, the Court Service shall compensate the parties for any time and costs which have been wasted.").
The noble Lord said: This amendment would require the court service to pay compensation for wasted costs to the parties in a civil action who attend for a fixed trial or hearing which is ineffective or delayed because of a failure of the court service.
The civil justice reforms masterminded by the noble and learned Lord, Lord Woolf, which will be introduced in April this year, aim to reduce the cost and complexity of most civil proceedings. One particularly welcome innovation of the reforms is the intention that the courts will fix trial dates and starting times for trials much earlier in all proceedings in order to give the parties a timetable to work to. The new court rules will only allow these fixed trial dates to be postponed in strictly limited circumstances. This praiseworthy aim is to prevent unwarranted delays and slippages in preparing trials.
In lower value claims, which will be allocated to the new fast track in the county court, trial dates are to be fixed about 30 weeks after the defence is filed. This will cut the present average time for the conclusion of county court cases by some 50 per cent.
The noble and learned Lord, Lord Woolf, also proposed that the legal costs which the winning party can recover from the losing party in these lower value claims should be fixed. This would enable a party, before beginning litigation, to have greater certainty about the costs he might have to bear if the claim does not succeed.
As the first stage of implementing the noble and learned Lord's recommendations, the fixed costs of advocacy at the trial are being introduced in April this year. This initiative is thought to be feasible because it is intended that fast-track cases will be scheduled for no more than one calendar day.
But there are serious concerns about whether or not the courts will be able to keep to definite trial dates and times. Only very limited additional resources are being allocated to the court service to implement the most significant reforms to the civil justice system for 100 years. No more full-time judges are being

1247
appointed and the technology needed to enable the courts to case manage and monitor actions will not be introduced until the year 2000 at the earliest.
Under the present system the courts tend to list several cases to be heard on the same day at the same time and before the same judge on the assumption that many of them will settle before the day arrives. In addition, the county courts in particular will list other appointments for the judge at 10 or 10.30 a.m. to sort out more urgent matters which have to be disposed of before starting to hear the day's trial. Quite frequently this means that a trial does not begin until noon or even the beginning of the afternoon, and if some of the cases listed for that day do not settle some trials have to be postponed. It is not always possible for courts to give parties notice of the likelihood of postponement but the present practice is that compensation will be paid to parties on an ex gratia basis if there have been errors in listing that amount to maladministration.
Without additional resources it will be very difficult for the court service sufficiently to change its established practices to ensure that even most of the fast track fixed date and time trials take place. But if the parties arrive at court with their full teams, which may include solicitor, counsel, witnesses of fact and sometimes expert witnesses, and the trial cannot start until later that day or at all substantial additional costs will be incurred which, under the new system, cannot be recovered even by the successful party because of the introduction of fixed trial costs. That will be unfair and will create uncertainty in a system that is designed to be streamlined, efficient and, above all, transparent.
I hope that the courts will be able to deliver fixed date and time fast track trials. If they cannot a system needs to be in place to provide proper compensation. The noble and learned Lord, Lord Woolf, recommended this in his report Access to Justice in 1996 and the Civil Procedure Rules Committee responsible for drawing up the detail of the reforms to be implemented in April has made a similar recommendation. I beg to move.
Lord Clinton-Davis: Perhaps I may put one question to the noble Lord. Does not the amendment place too draconian a burden on the courts? The amendment does not provide that if the court is unable to take account of the situation that has arisen it shall be exempt from the duty. A judge may fall ill or an accident may occur. There may be circumstances of that kind over which the court has no control.
Lord Kingsland: There may indeed be circumstances that will excuse the court service from making such a payment. I have tabled this amendment and it is for the noble and learned Lord the Lord Chancellor to react to it and say to what extent he believes it is appropriate, requires modification or is at all relevant. I believe it right to start with the principle that if the court service is at fault in circumstances where a date and time has
1248
been fixed it is proper that the parties should be compensated in view of the new cost system laid down in the fast track proposals.
Lord Falconer of Thoroton: The noble Lord puts the amendment on the basis that if the court is at fault it should pay. That is not the way the amendment is currently drafted. The amendment reads:
"Where a civil court has allocated a fixed time and date for a hearing or trial, but fails in the event to honour that commitment, without giving reasonable prior notice to the parties, the Court Service shall compensate the parties for any time and costs which have been wasted".
The noble Lord knows all too well that one of the major reasons why dates are lost when the parties turn up at court is because the cases listed before them overrun. Cases frequently overrun because the parties give inaccurate time estimates. That is not the fault of the court. Yet, on the basis of the amendment, compensation must be paid.
That is not simply a technical point. Practitioners know only too well that cases overrun, and it happens with the best will in the world on the part of the judges, the parties and the lawyers. It inevitably dislocates following business. The effect of the amendment would be either over-cautious listing, leading to longer waiting times and poor use of judicial time, or an increase in the amount of compensation paid. Both points will lead to an increase in the cost of running the civil courts, and that, in its turn, will he reflected in the fees.
Ultimately, listing is a judicial matter. Court service staff act under guidelines agreed with the local judiciary and seek judicial advice when listing difficulties arise.
However, where there has been a clear error on the part of staff which is separate from any judicial direction, in practice the Lord Chancellor's Department pays compensation. The parties involved are compensated for any costs that they have incurred unnecessarily. That is what happens now. The total compensation paid in 1997/98 was about £500,000. Dealing with such issues is not a matter appropriate to legislation. They are administration matters.
Under the civil justice reforms, which shall be introduced in April, the courts will rely to a large extent on information given by the parties in determining how to list business. The proposed amendment will make the court service liable for inaccurate time estimates made by the parties. That cannot be right. That said, the court service has already indicated to the Law Society, the Bar Council and consumer groups that it will consider the impact of the civil justice reforms on the compensation arrangements. It met with representatives of those groups on 8th January, but, not surprisingly, the court service's consideration is not yet concluded.
In the light of my remarks, I urge the noble Lord to withdraw his amendment.
Lord Kingsland: I thank the noble and learned Lord for his reply. I accept that the terms of my amendment may be said to be a little stark. However, the noble and learned Lord, Lord Woolf, who remained stoically throughout this evening—sadly, he has just departed—recommended a system similar to the one that I am

1249

recommending. In those circumstances, I have drawn sufficient inspiration from the noble and learned Lord's reply to reconsider the matter and table it again on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 49 [Commission areas.]:
Lord Gisborough Lord Gisborough moved Amendment No. 299:
Page 25, leave out lines 29 and 30.
The noble Lord said: In speaking to Amendment No. 299, I also speak to the Question whether Clauses 50 and 51 and Schedule 7 shall stand part of the Bill.
The basic units of the magistrates' courts service are the benches made up of local people who deal with, and are aware of, local issues. Benches vary in size, geographical location and the type of workload which is predominantly dealt with. From large city courts comprised of over 400 magistrates to small rural courts made up of less than 20 justices, all share a sense of belonging to a community organisation dealing with local issues.
If petty sessional areas are not based upon discrete localities of optimum size, magistrates will not be in a position to determine the make-up of their benches' sitting patterns, choice of chairman and standard of justice. Large benches based on commission areas would run a risk of inconsistent sentencing and be placed in a position where they might be unaware of the ability of their colleagues when deciding whom to elect as a bench chairman. Magistrates may not wish to travel and would not be aware of local practices and procedures.
Benches are not tribunals. They, and not the magistrates' courts committees, are responsible for the organisation of court business. That encourages a deep understanding and co-operation with colleagues and legal advisors. Creating large petty sessional areas based upon regions rather than towns or cities would lead to a diminution of lay magistrates belonging to the community that they serve. I cannot see any discernible advantage in the benches being formed in such large units. I beg to move.
11.15 p.m.
Lord McIntosh of Haringey: Amendment No. 299 would remove subsection (2) of the new Section 1 which Clause 49(1) is inserting in the Justices of the Peace Act 1997 in place of Sections 1 and 2. That subsection provides the ability to specify commission areas by way of statutory instrument rather than as at present by primary legislation.
Commission areas provide the basis for the appointment of magistrates and the jurisdiction of cases. Historically, commission areas have aligned with magistrates' courts committee areas, allowing for magistrates and cases to be deployed effectively across an MCC area. However, unlike both MCC and petty sessions areas, where changes to boundaries are possible through secondary legislation, commission areas may only be changed in strictly prescribed circumstances by primary
1250
legislation. To facilitate greater alignment between criminal justice agency boundaries, in particular police and Crown Prosecution Service boundaries, the number of MCCs has reduced in recent years by a series of amalgamations so that the areas are more closely aligned with these boundaries. The result is a growing discrepancy between MCC and commission area boundaries, with some MCCs covering more than one commission area. The time taken to effect change by primary legislation undoubtedly causes difficulties for MCCs. They are being prevented from redrawing their internal boundaries to reflect the local character of the service. Difficulties will ensue.
The Government believe that constraints on the effective administration of the magistrates' courts service should be removed wherever possible. This clause would regulate the procedures for all proposed changes to magistrates' courts boundaries and remove the increasingly obsolete description of retained county and metropolitan county areas. In future, commission areas will be defined in secondary legislation, and boundaries may also be altered by secondary legislation. I assume we can all agree that unfortunately the reorganisation of local government will not come to an end with the end of this millennium. The important point is that the Delegated Powers and Deregulation Committee has seen no difficulty with this change. Changes will, of course, require consultation with the MCCs and magistrates affected. There will be parliamentary scrutiny of the orders made.
If an MCC is to operate effectively, it must be free to make decisions about its geographical structure, including the arrangements for commission areas and petty sessions areas.
These changes respond to difficulties faced by some magistrates' courts committees. Those committees want to make the best use of their magistrates and resources to improve service. Future changes in the service, continuing the modernisation of the courts, will be managed more easily and quickly. On that basis, I shall ask the noble Lord to withdraw the amendment.
The noble Lord said that he spoke also to his notice of intention to oppose Clause 50 stand part and, I believe, Clause 51 and Schedule 7, so he is asking for a rather wide-ranging reply. Perhaps I may answer on Clause 50, which has two parts.
Lord Phillips of Sudbury: Before the noble Lord turns to those clauses, will he perm it me to inquire what consultation arrangements would be available if statutory instruments are used to change these boundaries under the proposed clause?
Lord McIntosh of Haringey: I have already said that the magistrates' courts committees would be consulted in detail before any order is proposed. Indeed, it will be not just the magistrates' courts committees but the magistrates themselves on the individual benches. So there would be opportunity for full consultation.
Lord Phillips of Sudbury: Are there any statutory requirements to that effect?
Lord McIntosh of Haringey: No, but the noble Lord has my assurance, which is relevant to the interpretation of statute.
I return to the wider issue of Clause 50 to which the noble Lord, Lord Gisborough, referred. The definition of petty sessions areas, which Clause 50 covers, in terms of commission areas allows a magistrates' court committee the freedom to decide the most appropriate and efficient petty sessions structure which best suits its local circumstances, free of the changing constraints of local government boundaries. Petty sessions areas will in future be specified in an order made by the Lord Chancellor. I must emphasise that there is no change in the procedure for reorganising petty sessions areas and MCCs will continue to be free, subject to statutory consultation procedures, to redraw their internal boundaries.
A further provision in Clause 50 removes the distinction between a petty sessions area and a petty sessional division, which exists only for the purposes of geographical identification and is no longer necessary with the changes in local government boundaries.
I appreciate that the noble Lord, Lord Gisborough, has widened the scope of his introduction of Amendment No. 299, but I hope that he will accept that the argument against it would justify his withdrawing the amendment.
Lord Gisborough: I thank the noble Lord for that explanation. It sounds benign, but I wish to consider whether to come back at a later stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 49 agreed to.
Clause 50 agreed to.
Clause 51 [Consequential amendments]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 299A:
Page 27, line 44, leave out ("Schedule 7 (which makes amendments") and insert—
(" .—(1) The Lord Mayor and aldermen of the City of London shall not be justices of the peace unless appointed by the Lord Chancellor in accordance with the Justices of the Peace Act 1997.
(2) Schedule 7 (which contains other provisions").
The noble and learned Lord said: This clause and Schedule 7 complete the statutory changes needed as a consequence of the new approach to commission areas and petty sessions areas which we debated in connection with Clauses 49 and 50. The new material introduced by these amendments relates to the City of London.
Clause 57 will create a Greater London Magistrates' Courts Authority (GLMCA), merging the existing 22 magistrates' courts committees (MCCS) in London. The GLMCA will be responsible for the administration of all the magistrates' courts in the capital in place of the 22 responsible for their separate geographical areas. As well as having the ability to manage its workload and magistrates' courts more efficiently and reduce delay, a further benefit will be the capability, if the GLMCA so wishes, to apply to redraw the commission area boundaries. A commission denotes the geographical area
1252
within which summary offences may be tried and for which lay magistrates are appointed. Furthermore, the GLMCA will also be about to redraw its petty sessions area, just like any other MCC.
The Government's policy is that the GLMCA should have the same freedom as other MCCs in the rest of the country to move cases and magistrates to administer justice with maximum efficiency and to reduce delays. Flexibility to change commission areas will be an integral part of the policy. This policy stems from work done in the criminal justice system cross-cutting Comprehensive Spending Review.
The Bill's provisions, if enacted, will have an impact upon the City of London MCC, its commission area, its petty session and the role of the Lord Mayor and Aldermen of the City of London as Justices of the Peace. It is certainly possible that the City will be able to persuade the GLMCA that it should remain a separate commission area for the indefinite future. What is, however, unacceptable is that the City's commission area alone among the commission areas in the country should have a statutory guarantee of preservation in perpetuity. That would be an unacceptable restriction on the power of the GLMCA when the Bill confers powers to make changes for every other part on England and Wales.
There are other areas of the country with their own separate commission areas which are a matter of county and historic pride and it would discriminate against them to provide a unique statutory guarantee for the City commission area. The Lord Mayor and the aldermen currently have special rights carried forward from a charter granted to them in 1741 by His Majesty King George II. They are the only body of persons in the country who have the right to be magistrates through election as aldermen—in other words, they become magistrates by virtue of their office and not as a result of appointment by me as Lord Chancellor (or in the case of magistrates within the Duchy of Lancaster, by the Chancellor of the Duchy).
In practice, prospective aldermanic candidates apply to the advisory committee prior to aldermanic elections for it to be determined whether they fulfil the criteria for appointment as magistrates. That is sensible and can continue as of course. In practice, prospective aldermanic candidates qualify as eligible to be appointed magistrates prior to their election. The practical position in the City commission area is that there is always a demand for the service of aldermen, when elected, as magistrates, provided they satisfy the advisory committee's criteria.
While I firmly believe they play an important role in the delivery of justice in the capital, I also believe that it cannot be right for the ancient rights and privileges of the Lord Mayor and the aldermen to be justices of the peace by virtue of their office to continue in perpetuity. Amendment No. 299A amends Clause 51 by removing this automatic right of the Lord Mayor and the aldermen of the City of London to be lay justices of the peace by virtue of their office. The effect of this amendment means that the Lord Mayor and the aldermen will become justices of the peace only after passing through the same selection procedure as applies to all other magistrates through England and Wales. The amendment also means

1253
that they can, if they so wish, and are suitably qualified, apply to become either stipendiary or acting stipendiary magistrates or district judges (magistrates' courts) as they will in future be known.
It will be my policy—and this is a policy I believe will be appropriate as long as there is a need for aldermen to be justices—to appoint those who have been elected as aldermen, as justices if the advisory committee, applying the same criteria as apply in the rest of the country, recomend their appointment to me. To give effect to that policy, I shall be requiring my advisory committee to consider aldermen candidates as and when they present themselves for selection and within the timescales needed for aldermen selection.
The current position for the residence qualification for justices of the peace is that they must reside in or within 15 miles of the commission area to which they are appointed. However, many of the aldermen live more than 15 miles from the City. Therefore, I propose that if the Lord Mayor and the aldermen are appointed justices of the peace, I shall exempt them from this requirement. Amendment No. 299C gives effect to that proposal.
Furthermore, Amendment No. 328E inserts a new paragraph in Schedule 10 which allows the existing Lord Mayor and aldermen to remain justices of the peace as if they had been appointed under the current arrangements. These amendments set out my policy in respect of the Lord Mayor and the aldermen as justices. The remaining amendments grouped with these make further statutory amendments to give effect to my policy.
I should not wish to depart from explaining these amendments to the Committee without expressing the Government's appreciation for the high quality services that the aldermanic magistrates have rendered over the years for the benefit of the public and the City and to express my expectation that they will do so in the future. I beg to move.
11.30 p.m.
Lord Kingsland: The noble and learned Lord the Lord Chancellor has anticipated a question that I was going to ask and to a large extent he has answered it. As he is well aware, the potential effects on the Corporation of this change—I am referring to the effects of Amendment No. 229A—I would go very much further than the amendment suggests if the Lord Mayor and Aldermen were not in fact appointed as magistrates. That is because, I understand, other parts of the Corporation's constitution require that they are magistrates; if they were not, other functions of the Corporation, such as the operation of the City of London Police Authority and the relationship of the Lord Mayor and the Court of Aldermen with the livery companies, would be affected.
I believe that the Lord Mayor and Aldermen would prefer statutory backing for the future of both offices as magistrates. However, the noble and learned Lord has gone a very long way to reassuring future Lord Mayors and Aldermen of his commitment to their status as magistrates. In those circumstances, I certainly would not wish to press this matter any further.
On Question, amendment agreed to.
Clause 51, as amended, agreed to.
Schedule 7 [Commission areas and petty sessions areas: amendments]:
The Lord Chancellor The Lord Chancellor moved Amendments Nos. 299B to 299D:
Page 75, leave out lines 19 to 23 and insert—
(".—(1) Section 19 of the Administration of Justice Act 1964 (sheriff of Greater London and under-sheriffs for London commission areas) is amended as follows.
(2) In subsection (1) (appointment of sheriff of Greater London and under-sheriff for each London commission area), for "and for each London commission area an under-sheriff shall be so appointed" substitute "and an under-sheriff shall be so appointed for each area of Greater London (not including any part of the City) specified by the Lord Chancellor by order; and an order under this subsection shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament".
(3) In subsection (2) (application of enactments to under-sheriffs as if London commission areas were counties), for "London commission area" substitute "area specified by virtue of subsection (1) of this section".
(4) In subsection (4) (modification of Sheriffs Act 1887 in its application to Greater London)—

(a) for "London commission area" substitute "area specified by virtue of subsection (1) of this section",

(b) for "a justice of the peace for any of the London commission areas" substitute "any justice of the peace for a commission area consisting of or including the whole or part of Greater London", and

(c) for the words from "shall be sent" to the end substitute "shall be sent to the officer specified by the Lord Chancellor by order made by statutory instrument".").

Page 76, line 26, at end insert—
("23A. In section 6 (residence qualification for justices), after subsection (1) insert—
"(1A) If a person who is the Lord Mayor or an alderman of the City of London is appointed in accordance with section 5 above as a justice of the peace for a commission area including the City of London, subsection (1) above shall not apply in relation to his appointment as a justice of the peace for that area so long as he holds either of those offices."").
Page 77, line 32, at end insert—
(". In section 70(1) (application of enactments to City of London), for "justices for the City" substitute "justices for a commission area consisting of or including the whole or part of the City".").
On Question, amendments agreed to.
Schedule 7, as amended, agreed to.
Clause 52 [Unification and renaming of stipendiary bench]:
Lord Gisborough Lord Gisborough moved Amendment No. 300:
Page 28, line 9, leave out ("District Judge (Magistrates' Courts)") and insert ("stipendiary magistrate").
The noble Lord said: Grouped with this amendment are Amendments Nos. 301 to 310 and 312 to 317. Although it is accepted that stipendiary magistrates are professional lawyers who support and complement the work of benches, they enjoy the same powers and the jurisdictional limitations as the lay magistrates. Their sentencing powers are identical and the maximum penalties which apply to the bench are the same. To differentiate their role from that of lay magistrates may demean the latter's role in the eyes of the courts' users and the general public.
Stipendiary magistrates will of course continue to play an important role in the magistrates' courts. A change of title may be confusing and create the appearance, however mistaken, of a two-tier system. We should take into account the views of the lay magistrates, who consider the change of name to be detrimental to the role and image of the magisterial system. Magistrates are often already suspicious that stipendiaries are liable to get the more interesting cases and the change of their name to district judges will increase their concern. I beg to move.
Viscount Tenby: I wish to speak to the amendment moved by the noble Lord, Lord Gisborough. Most clauses in most Bills have some sort of rationale behind them, but I am bound to confess that the one relating to this clause has been so skilfully camouflaged that I am unable to detect it readily. I am sure we can dismiss as mischievous the proposition that it is included to feed the vanity of stipendiary magistrates. After all, what's in a name, though I am slightly surprised that they would prefer to be called "DJs" rather than "stipes": a sign of the times, I suppose.
I also cannot quarrel with the recommendation that such magistrates should be able to be sent to any commission area in need of them. Such a provision is long overdue. But why should peripatetic magistrates receive a new name? That is the mystery before us tonight. It seems to me that there is an inherent danger in the proposal to call stipendiary magistrates district judges. After all, as we have heard, both they and the lay magistrates operate in the same lower courts, their powers of sentencing are similar, though, since they are full time and skilled professionals, their throughput, to use an awful modern phrase, is much larger. As the chairman of a Bench, I was anxious that as many of my team as possible should watch a stipendiary in action. It was invaluable training for them.
So let there be no doubt of my appreciation of stipendiaries and their work. However, if this proposal goes through, we shall surely be creating a two-tier system in the lower courts. Will defendants become confused and think they are being dealt with by a higher court? What about lay magistrates? In my experience, unpaid workers tend not to be regarded as highly as those who are paid. Perhaps we can counter that by calling JPs District Justices (Lay) in future. That is many questions for a comparatively short provision. I greatly hope that the Minister will be able to provide some of the answers.
Lord Phillips of Sudbury: One could think these many amendments superficial and unimportant, but they are not. The great British public today are astonishingly confused about the organisation of the state and the judicial system. The magistrates' courts have a great advantage in being known and familiar throughout the land. That cannot be said of any other part of the system.
I urge strongly that unless there is some reason for change of which this Committee is unaware, we let the names continue. It is an honourable name. The magistracy has 700 honourable years' service and I see absolutely no purpose in potentially confusing the role
1256
of the stipendiary magistrate with other judicial officers in the civil system through the proposed change. I do not need to repeat the potential implications of such a change vis-à-vis the standing of lay justices. I am sure that every Member of the Committee would wish to uphold to the fullest extent the standing of the lay magistracy who, I venture to suggest, are perhaps the most important single institution in the state outside these Houses of Parliament. I urge strongly therefore that the Government think hard about this apparently superficial, but far from superficial, change.
Lord Crathorne: I too support these amendments. I do so as president of the Cleveland and North Yorkshire Magistrates' Association. I want to put on record how strongly magistrates feel about the change of name. There have been eloquent speeches from all sides of the Chamber in that regard, and I hope that the matter will be carefully considered.
Lord McIntosh of Haringey: I do not want in any way to play down the importance of names. Those of us who sat through the proceedings on the Police and Magistrates' Court Bill of 1994 will remember how much emphasis there was on names. In that case, as the noble Viscount, Lord Tenby, will recall, the proposal of the then Lord Chancellor to call justices' chief executives, as they are now called, chief justices' clerks, caused fury on the Cross-Benches and indeed the Bill was changed accordingly. And why not? We have a better title as a result.
I fully agree therefore that titles are important. But the Government are here pursuing a course which is legitimate from both sides of the fence and not creating an unnecessary fence. We announced our intention to modernise justice and to make it accessible to all. One of the ways we intend to do that is by establishing a unified Bench of professional judges in the magistrates' courts with a new title reflecting their status. The new title is important in recognising the work of the district judge magistrates' court and underlines the role of the unified Bench. But the important point to note is that it will not undermine the lay Bench, nor create a two-tier system; nor will it affect the number of lay magistrates. The new title was sought by the stipendiary magistrates and they have welcomed the offer of this new title, which realistically gives effect to their status as full-time professional judges. It will also assist in launching the new unified Bench, which is provided for in this part of the Bill, by confirming to the public the judicial status that stipendiaries currently hold.
It will also aid court users in that the district judge (magistrates' court) will possess a title which more accurately reflects the work and expertise. No damage is done whatever to the lay magistrates by this proposal, but it does reflect the real work which those who are now called stipendiary magistrates do. I therefore invite the noble Lord to withdraw his amendment.
Lord Gisborough: There were three points of note in that reply, one of which related to the unified Bench. It seems to me that if there is a stipendiary magistrate and a lot of other magistrates, that is a unified Bench,

1257
but a judge and other magistrates is hardly a unified Bench. "Modernisation", which is the key word, must not be confused with change for the sake of change.
When "clients", as I think they are now called, come before the court and find that they are in front of a judge instead of a magistrate, I believe they will be much more fearful. We know that the district judge can give only the same punishment as a magistrate, but I am sure that the clients will not know that.
This amendment is obviously well supported and I may well wish to bring it back on Report. However, at this stage, I beg leave to withdraw it.
Amendment, by leave, withdrawn.
[Amendments Nos. 301 to 317 not moved.]
Clause 52 agreed to.
Schedule 8 [Unification and renaming of stipendiary bench]:
The Lord Chancellor The Lord Chancellor moved Amendment No. 317A:
Page 78, line 22, leave out from ("for") to end of line 28 and insert ("any one of the police magistrates at any of the Metropolitan Police Courts" substitute "two justices of the peace", and
(b) omit the words from "or if the offence,", in the first place, to "the county;".").
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 317B:
Page 82, line 38, leave out from ("for") to end of line 40 and insert ("chief metropolitan stipendiary magistrate or a designated metropolitan magistrate" substitute "Senior District Judge (Chief Magistrate) or another District Judge (Magistrates' Courts) designated by him".").
The noble Lord said: In moving Amendment No. 317B, I shall speak also to Amendments Nos. 317C to 317G, and 330K and 330L.
The purpose of these amendments is to give the senior district judge (magistrates' court) the authority to designate which district judge (magistrates' court) should deal with cases under the Extradition Act 1989. This will ensure that only those district judges (magistrates' courts) with the appropriate knowledge and expertise in extradition law will hear cases brought before the courts.
In moving this amendment, as I have said I am speaking also to Amendments Nos. 330K to 330L in Schedule 11 which address minor changes to the wording of the Extradition Act to reflect the limitation of jurisdiction in extradition cases to district judges (magistrates' courts) designated by the senior district judge (magistrates' court). I beg to move.
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 317C to 317G:
Page 82, leave out lines 41 to 43 and insert—
("35.—(1) Section 9 (proceedings for committal) is amended as follows.
(2) In subsection (1) (person arrested in pursuance of a warrant under section 8 to be brought before a court consisting of a metropolitan magistrate or a sheriff), omit the words from "consisting" to the end.
(3) In subsection (2) (court of committal in England and Wales), after "Wales" insert "shall consist of the Senior District Judge (Chief Magistrate) or another District Judge (Magistrates' Courts) designated by him and".
(4) In subsection (3) (court of committal in Scotland), after "Scotland" insert "shall consist of the sheriff of Lothian and Borders and".").
Page 83, leave out line 3 and insert ("In paragraphs 1(2)(b), 6(2), 7(1) and (2), 8(1) and 11, for "metropolitan magistrate").
Page 83, line 4, at end insert—
("( ) In paragraph 4(2) (order of Secretary of State for issue of warrant), for "a metropolitan magistrate" substitute "the Senior District Judge (Chief Magistrate) or another District Judge (Magistrates' Courts) designated by him".
( ) In paragraph 5 (issue of warrant for apprehension on receipt of order by metropolitan magistrate)—

(a) in sub-paragraphs (1)(a) and (3), for "a metropolitan magistrate" substitute "the Senior District Judge (Chief Magistrate), or another District Judge (Magistrates' Courts) designated by him,", and

(b) in sub-paragraph (4), for "metropolitan magistrate, unless the metropolitan magistrate" substitute "District Judge (Magistrates' Courts) unless he".

( ) In paragraph 6(1) (hearing of case), for "metropolitan magistrate, the metropolitan magistrate" substitute "District Judge (Magistrates' Courts) he".").
Page 83, line 6, at end insert ("references to the Senior District Judge (Chief Magistrate) or another District Judge (Magistrates' Courts) designated by him were to any District Judge (Magistrates' Courts) and those references and the").
Page 83, line 9, leave out from ("Ireland;",") to end of line 11 and insert—

("(b) in sub-paragraph (1)(c), for "the stipendiary magistrate," substitute "any District Judge (Magistrates' Courts), or the", and

(c) omit sub-paragraph (2).").

On Question, amendments agreed to.
Schedule 8, as amended, agreed to.
Clauses 53 and 54 agreed to.
11. 45 p.m.
Clause 55 [Areas outside Greater London]:
Lord Gisborough Lord Gisborough moved Amendment No. 318:
Page 30, line 44, at end insert ("; and
(c) such functions relating to matters of an administrative character or a non-judicial character as they may be authorised to undertake.").
The noble Lord said: Clause 55 changes significantly the role of the magistrates' courts committees. Hitherto, committees have been responsible for the efficient and effective administration of magistrates' courts.
That remit does not extend to the organisation of the local Benches. Advisory committees recommend the appointment of justices, and the local Benches elect their chairmen and deputy chairmen, and constitute

1259
panels and committees. The Benches are responsible for all judicial actions which include the listing of cases. The distinction between the role of the Bench and that of the committee is important. It establishes the divide between the judiciary and the administration. The courts exercise a judicial discretion in respect of individual cases and the committees do so in respect of the management of resources. To maintain that delicate balance, Clause 55 should make it abundantly clear that any functions which are conferred or imposed on the committees should be of an administrative or non-judicial character.
The fact that non-magistrate members of the committees may become a majority, some of whom could be local politicians, may compromise the magistrates and the Benches if the organisation of Benches becomes a responsibility of the magistrates' courts committees. It is therefore important that the committees' remit is clearly defined within acceptable limits. I beg to move.
Lord McIntosh of Haringey: I fully recognise the seriousness of the issue to which the noble Lord refers in this amendment and I do not want to do anything other than take the amendment seriously, but it is unnecessary.
The definitions of the functions of MCCs outside Greater London, as set out in Section 27(1) of the Justices of the Peace Act 1997, are unchanged by Clause 55. That reflects the position since the Police and Magistrates' Courts Act 1994. The 1997 Act was the consolidation Act. The position is working well.
Clause 55 merely splits the old Section 27(1) into new Sections 27A and 27B. The substantive changes to Section 27 are to replace the provisions of Section 27(2) onwards with new Sections 27A and 27B. There are two reasons for that. I am going outside the literal terms of the noble Lord's amendment because the issue is important. First, that is consequential with the establishment under the Bill of a Greater London magistrates' court authority. Secondly, MCCs are currently defined in terms of local government areas such as counties and metropolitan districts. Continuing amalgamations mean that the definition of the committee area in primary legislation is no longer reflected by the reality on the ground. Committees now increasingly comprise more than one defined area and the area definition in Section 27 of the Justices of the Peace Act 1997 is becoming obsolete.
I understand the concern behind the proposed amendments: that MCCs should not encroach upon judicial functions. The independence of legal advice provided by justices' clerks, and the duties and responsibilities of magistrates, are protected by Section 48 of the Justices of the Peace Act. The MCC has no locus in the judicial process. This clause does not change that.
The primary purpose of this clause is to ensure the easy identification of MCCs in England and Wales. The clause removes the definition of MCCs in terms of local government areas and replaces it with one where MCCs are defined by order. It does not amend the procedure
1260
for reorganising an MCC or the definition of its function as established under the 1994 Act. There will continue to be statutory consultation on proposed local changes. On that basis, I invite the noble Lord to withdraw his amendment.
Lord Gisborough: I thank the noble Lord for that explanation and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 55 agreed to.
Clauses 56 and 57 agreed to.
Clause 58 [Standard goods and services]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 318A:
Page 35, line 14, leave out from ("requiring") to end of line 16 and insert ("every magistrates' courts committee, or every specified magistrates' courts committee, to obtain for the performance of any function referred to in section 55(1) above").
The noble Lord said: In moving the above amendment I shall speak also to Amendment No. 318B. The amendment has the effect of applying a technical clarification to Clause 58, making it clear that the reason why the MCC is being required to obtain particular goods or services is for the proper performance of its functions in the context of Section 55(1) of the Justices of the Peace Act 1997. The amendment also makes explicit that any regulations made may set a specific time by or at which the goods or services should be obtained.
Clause 58 allows the Lord Chancellor, if he considers that it would be in the interests of the efficiency and effectiveness of the magistrates' courts generally, to make regulations to require all MCCs, or specified MCCs, to use specified goods or services, or goods or services of a specified description. For example, the Lord Chancellor may require MCCs to purchase goods or services from a particular supplier where the department has negotiated a national contract on beneficial terms. Alternatively, he may require MCCs to purchase goods or services of a specified description so that they are compatible with those used by other MCCs (or other agencies), but leave it up to the MCC (or the paying authority) from whom the items are to be obtained. It is particularly in relation to new technology that it is considered that the proposed power will be most useful, but it could also be used in respect of other items, such as court forms.
I well remember my noble friend Lady Hilton of Eggardon recalling from her days in the Metropolitan Police that there were five police forces operating in the area around the M.25. Three different telecommunications systems applied to those forces, but they could not communicate with each other. I hope that these two amendments go some way towards ensuring that that does not happen in the magistrates' court service. I beg to move.
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 318B:
Page 35, leave out lines 22 to 25 and insert—
("(2) Regulations made by virtue of subsection (1) above may include provision requiring magistrates' courts committees to obtain the specified goods or services, or goods or services of the specified description—

(a) from a specified person or person of a specified description;

(b) at or by a specified time; or

(c) both from such a person and at or by such a time.").

On Question, amendment agreed to.
Clause 58, as amended, agreed to.
Clause 59 [Qualification for appointment]:
On Question, Whether Clause 59 shall stand part of the Bill?
Lord Kingsland: If Clause 59 is to stand part of the Bill, then, in my submission, certain changes will have to be made to Clauses 60 and 61. The provisions in all three clauses allow further encroachment by the courts' committee, and its chief executive, on the independence of the judiciary. The magistrates are supported by their professional advisers—that is to say, the justices' clerks. Section 45(4) of the Justices of the Peace Act 1997 provides that,
"the functions of a Justices' Clerk include giving advice to the justices to whom he is clerk at their request about law, practice or procedure on questions arising in connection with the discharge of their functions, including questions arising when the clerk is not personally attending on them".
Section 45(5) goes on to state that,
"the powers of a Justices' Clerk include, at any time when he thinks he should do so, bringing to the attention of those justices any point of law, practice or procedure that is or may be involved in any question so arising".
Through those provisions, the justices' clerk has, traditionally, brought to the attention of his justices changes to the law. The lay justice cannot, for example, be expected to pick up a new piece of legislation or read all the cases relevant to his or her area of work. Justices rely on their justices' clerks to bring relevant law to their attention, and then to advise on its interpretation. Under Clause 60, the Government propose that justices' clerks must now carry out this responsibility under the direction of the chief executive; and Clause 59 provides that this person need no longer be qualified in the law.
In practice this may mean that, at bench meetings and at magistrates' training sessions, the justices' clerk can be directed to give the interpretation of new legislation that is most favoured by the executive. It is not good enough for the Government to suggest that the independence of the judiciary is preserved by the fact that the justices' chief executive cannot direct the justices' clerk when advising a justice, or justices, in an individual case. If the chief executive has given a direction on the advice to be given through correspondence, at bench meetings or in training sessions, what credibility has the justices' clerk who, in the privacy of the retiring room, then advises justices in an individual case and says, "Ignore what I told you at the bench meeting, in my circular and in the training—what I say to you now is contrary, yet correct, advice"?
1262
The provisions of Clause 61(5) are also of concern to both the Magistrates' Association and the Justices' Clerks' Society. The Lord Chancellor will know that a working group on the judicial and administrative boundary in magistrates' courts was set up by his officials and yet, after 12 months of work, failed to come up with a clear definition of what work could be described as truly judicial and what work could be defined as administrative. The noble and learned Lord's officials were unsuccessful in drawing this distinction; it now appears that the noble and learned Lord is going to draw the distinction through statute.
He does so by defining all of the justices' clerks' functions as administrative—apart from giving advice to justices of the peace in an individual case and functions conferred on them when they act as a single justice. What then of the listing of cases? This is a function carried out by justices' clerks on behalf of their justices. In his speech on judicial independence, the noble and learned Lord the Lord Chief Justice quoted the then Lord Chancellor, my noble and learned friend Lord Mackay of Clashfern, from a lecture he gave on 6th March 1991. My noble and learned friend Lord Mackay of Clashfern said in relation to judges:
"Their function is to decide cases and in so doing they must be given full independence of action, free from any influence. But in order to preserve their independence, the judges must have some control or influence over the administrative penumbra immediately surrounding the judicial process. If judges were not, for example, in control of the listing of cases to be heard in the courts it might be open to an unscrupulous Executive to seek to influence the outcome of cases … by ensuring that they were listed before judges thought to be sympathetic to a point of view or simply by delaying the hearing of a case if that seemed to advantage the public authority concerned".
If Clause 61(5) is enacted, as presently drafted, in my submission listing becomes defined as an administrative function in magistrates' courts.
Viscount Tenby: I wish to make a brief observation about this matter. Of course many of my birds will already have been shot by the time I move my amendments because these matters are inextricably mixed. In fact I do not know why some of them were not grouped together. I have no intrinsic objection to a lack of a legal qualification for a justices' chief executive because it seems to me that you have to get talent wherever you can get it, but all other things must be equal. That point has been ably made by the noble Lord, Lord Kingsland, in opposing this clause.
I mention briefly in passing that the proposition in Clause 56—the Committee need not worry, I am not going back to it—that the number of co-opted members on an MCC might be increased from the present ceiling of two also looks attractive were it not for the fact that so far only about two MCCs out of 84 have even got as far as two.
Midnight
Lord Gisborough: Perhaps I may speak to my Amendments Nos. 319 to 322.
Lord McIntosh of Haringey: The noble Lord can do that; however, the grouping was agreed, not by the

1263
Government, but by noble Lords who are taking part. I was proposing to say that I should treasure the lapidary words of the noble Lord, Lord Kingsland, in my heart, but that they had nothing whatever to do with Clause 59 stand part. I should much prefer to debate the issues of detail in relation to Clauses 60 and 61 on the specific amendments tabled by the noble Lord, Lord Gisborough, and the noble Viscount, Lord Tenby. In that way, we have something that we can get our teeth into.
I hope that the noble Lord, Lord Kingsland, without repeating himself afterwards, will accept that it would be better to let Clause 59 stand part and then debate specific amendments.
Lord Kingsland: With great respect to the noble Lord, as I said at the outset, my attitude to the wording of Clause 59 will depend very much on what the noble Lord's reaction is to the amendments to Clauses 60 and 61. If the noble Lord does not intend to accept those amendments, I shall oppose the Question that the clause stand part of the Bill. So, with respect, in dealing with my submissions on Clause 59, the noble Lord has to deal with questions relating to Clauses 60 and 61.
Lord McIntosh of Haringey: Amendments are proposed to Clauses 60 and 61. I want to do the noble Lord, Lord Gisborough, and the noble Viscount, Lord Tenby, the courtesy of hearing their arguments on those amendments, and then I propose to respond to them. It would be discourteous of me to do otherwise.
Clause 59 removes the requirement that a person may not be appointed as a justices' chief executive without specified legal requirements. I commend the clause to the Committee.
Clause 59 agreed to.
Clause 60 [Role]:
Lord Gisborough Lord Gisborough moved Amendment No. 319:
Page 36, leave out lines 7 to 10.
The noble Lord said: In speaking to Amendments Nos. 319 to 322 I hope that I shall not repeat too much of what the noble Lord, Lord Kingsland, has said.
Recently, the previous Lord Chancellor stated that MCCs are important protectors of judicial independence. They must maintain the boundary between administration and judicial decision-making.
During the passage of the Police and Magistrates' Courts Act 1994, the then Lord Chancellor laid great stress on the importance of the judicial independence of the courts. The Act defined clear responsibilities for magistrates' courts committees and provided for the appointment of justices' chief executives, whose duties were also outlined.
To reflect the concerns acknowledged by the then Lord Chancellor, Section 48 of the Act recognised the risk of magistrates' courts committees and justices' chief executives interfering with the independence of a justices' clerk and legal staff in relation to legal functions and therefore provides that such officers shall not be subject to the direction of the committee or the justices' chief executive when performing legal
1264
functions. Only the justices' clerk, and through him his staff, has the statutory responsibility of giving advice to magistrates.
The 1994 Act, now incorporated in the Justices of the Peace Act 1997, makes a clear and crucial distinction between the justices' clerk as a legal adviser and the justices' chief executive as the executive officer and resource manager of the magistrates' court committee and defines their separate responsibilities.
In the White Paper, Modernising Justice, the Government's stated intention is to improve the management of magistrates' courts and the legal support given to lay magistrates by making a clear distinction between the two functions. Those advising magistrates need to be able to concentrate upon that important function.
I support the Government's contention that dedicated and skilled administrators who are fully engaged on that task are required to manage a modern magistrates' courts service. Justices' chief executives support committees in planning and managing the efficient and effective administration of the courts in the area.
At present, justices' clerks continue to be responsible in primary legislation for many administrative matters, often delegated to administrators. It is these powers and duties which can be transferred to the justices' chief executive under Clause 61. However, duties of a legal and judicial nature which are not protected by the provisions of Section 48 and the Justices of the Peace Act 1997 must never be subject to the direction of a justices' chief executive.
The temptation for justices' chief executives to meet government targets in the guise of co-ordinated and planned strategies, based upon performance indicators and unit costs with the prosecuting authorities at the expense of dispensing justice impartially, fairly and effectively, will be called into question.
The basis of the proposed new Section 41(6) of the Justices of the Peace Act 1997 in Clause 60 is fundamentally and constitutionally flawed. If a person has a statutory duty to perform, he must do it in an unfettered way. If the Government do not wish a person to possess such powers, then remove him and place him in some other office. Do not compromise this situation by the directions of another, as it could compromise the very foundations of judicial independence and public confidence in it. If such a transfer is to take place, then surely Parliament must scrutinise those powers. It is not right that they should merely be defined by the Lord Chancellor in some statutory instrument.
Even the magistrates' courts committee cannot direct the justices' clerk under the clause. We should ensure that in judicial and legal matters the justices' chief executive should not do so.
I beg to move the amendment to protect the judicial independence of the justices' clerks and that of the magistrates.
Lord Phillips of Sudbury: At this time of night, I intend to make only one point in support of the underlying purpose of the two amendments which are grouped together. I am aware that the noble Lord, Lord

1265
Kingsland, and the noble Viscount, Lord Tenby, have already referred to the underlying principle, which I am sure no one in the Committee would seek to subvert. It is to retain to the justices their full judicial powers, untrammelled by the intervention of a clerk or a justices' chief executive.
I wish to ask the Lord Chancellor to consider the impact of Clause 60(1) in so far as it would introduce into the Justices of the Peace Act 1997 a new Section 41. I believe that it is not currently clear. If one reads new Clause 41(1) together with new Clause 41(5) and then tracks over to Clause 61(5) of the Bill, it is not clear—and obviously the matter needs to be examined—that the concerns raised by the two amendments are met.
As I read it, under new Clause 41(5), everything that a justices' chief executive may do shall be subject to directions given him by the magistrates' committee. If that is correct, if every function that the justices' chief executive has under the Bill is subject to the directions of the magistrates' court committee, I believe that the anxieties of those proposing the two amendments are met. But I am not sure that that is the case when I read the three clauses. It is not clear and it would be helpful to have a response.
Lord McIntosh of Haringey: The effect of Amendment No. 319 would be to remove the subsection which provides that it is the duty of the justices' chief executive to make arrangements for the effective and efficient administration of the magistrates' courts within the area of the magistrates' courts committee which employs him as chief executive.
The post of justices' chief executive, as it is now properly called, we agree, was created in 1994 to carry on the day-to-day administration of the courts. Every magistrates' courts committee has long since appointed a justices' chief executive to manage the administration. The time is now ripe to look again, in the light of this experience, at how the relationship between the committee and the chief officer works.
Many reports by the Magistrates' Courts Service Inspectorate highlight the need for committees, while keeping a close watch on performance, to step back from operational management. The committee is there to decide strategy and set standards and to monitor and be accountable for implementation and achievement.
Clause 60 removes the committee's responsibility for allocating tasks among staff and determining administrative procedures. The day-to-day running of the courts' committees' area is the responsibility of the justices' chief executive.
This clause achieves that arrangement. It clarifies the responsibilities of justices' chief executives as line managers for all staff of the committee. It places the responsibility for allocating tasks and determining procedures with the chief executive. Clause 60 clarifies the relationships between and the functions of the committee and its officers. That clarity is important to achieve better management and improved accountability in the administration of magistrates' courts. It is appropriate for the modern management of today and in the future.
1266
New Section 41, subsection (5), confirms that a justices' chief executive shall perform his duties in accordance with any directions given to him by the committee. The justices' chief executive is ultimately accountable to the committee for the efficient and effective administration of the magistrates' courts in the area. If Amendment No. 319 were accepted it would remove the basis on which the day-to-day duties of running magistrates' courts are allocated. No one would have responsibility; the noble Lord's amendment would leave a lacuna.
The effect of Amendments Nos. 320 to 322 would be to extend the provisions which protect the independence of justices' clerks in the exercise of their duties, as set out in Section 48 of the Justices of the Peace Act 1997, the consolidation Act. The new Section 41 introduced in Clause 60 makes it clear that the justices' chief executive is responsible for making arrangements for the efficient and effective administration of the magistrates' courts in his area. The justices' chief executive may give directions to any of the staff of the committee, including justices' clerks, in respect of those administrative responsibilities and any other functions conferred on them by or under any enactment. It is clearly appropriate for him to do so.
There is one important exception to these powers of direction in Clause 60, and that is to protect the independence of the judicial process contained in Section 48 of the Justices of the Peace Act. Noble Lords may recall that the separation of judicial and administrative functions was debated in 1994. I do not conceal that those were difficult debates; I took part in them from the Benches opposite. As the then Lord Chancellor observed during the course of Third Reading, the essential function of the justices' clerk is to advise his Bench in an individual case. Parliament accepted that it is possible to differentiate between judicial and administrative functions.
The integrity of the judicial process in deciding individual cases must be entirely free from direction. When justices' clerks or their deputies are advising magistrates in individual cases, or when they are exercising their own judicial powers, Section 48 of the Justices of the Peace Act provides that independence. The new Section 41, which is inserted by Clause 60 of the Bill, makes it quite plain that justices' chief executives may not give directions to justices' clerks in relation to matters set out in Section 48. Moreover, it is quite clear from the new Section 41 that the responsibilities of the chief executive relate to the efficient and effective administration of the magistrates' courts for the area and not to the decision-making process in individual cases.
We have heard of instances where justices' chief executives have purported to issue directions that would have the effect of interfering in individual cases; for example, in the area of fine enforcement a direction that fines must be set at a particular level, or remitted, or not imposed in some circumstances. If that has happened, it is entirely wrong. In those examples, Section 48 is not being applied as it should.

1267
There is no reason why there should not be general policies, which have a part to play in promoting consistency of treatment. There may be several justices' clerks within the area of a magistrates' courts committee; the obvious person to promulgate information across the whole area, often through the justices' clerk, is the chief executive. For example, I would expect justices' clerks to be informed about the minimum amount that may be collected by credit card payment before the administrative charge exceeded the amount of the payment. Directions may go as far as saying that this information must be passed to magistrates, but it must always be made clear that such information is, in every individual case, subject to the absolute discretion of the person holding the judicial discretion.
There are other examples: the committee's general policy on fine enforcement, including such matters as which types of enforcement officers are generally to be used, with which bailiff companies the committee holds a contract, and the types of payment method available; good practice or procedure the Government wish to promote as helping to reduce delays; and standard operating procedures on such matters as the offices at which certain documents are to be lodged, and which courthouses have suitable facilities for disabled people.
I have not heard any convincing arguments as to why a justices' clerk should not be subject to direction by his line manager, the justices' chief executive, for all functions other than those protected by Section 48 of the Justices of the Peace Act. On that basis I invite the noble Lord to withdraw the amendment.
Lord Gisborough: I am grateful to the noble Lord for his long explanation which will be read with very great interest by the justices' clerks who are very concerned about this matter. The noble Lord has also answered a good number of the points arising on Amendments Nos. 323 to 326. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 320 to 322 not moved.]
12.15 a.m.
Viscount Tenby Viscount Tenby moved Amendment No. 322A:
Page 37, line 4, at end insert—
("( ) after "functions" insert "and powers";").
The noble Viscount said: In moving Amendment No. 322A I should like to speak at the same time to Amendment No. 322B. Since the shades of night are falling fast and it has been a long day perhaps the Committee will allow me to encompass Amendment No. 326ZA since all of these amendments are based on the same concern; namely, the independence of the justices' clerk in giving legal advice to his justices, which can be described only as the nitty-gritty of this clause. We have skirted round this for quite a time with various amendments that have come and gone. I am sorry to retrace my steps a little but I shall be as quick as possible.
I believe that the provisions concerned with the future relationship between the justices' chief executive and the Bench's justices' clerk entirely justify the concern which is evident within the magistracy and has been expressed in the Committee tonight. What it comes down to is that in future the justices' clerk will be unfettered in giving advice to his justices only on legal matters in individual cases and at all other times he may be subject to the directions of the justices' chief executive who may not be qualified in legal matters.
One of the provisions of the Bill is that a legal qualification need not be a requirement for appointment as a justices' chief executive. I have no quarrel with that proposal. To ensure that the best business and managerial talent is available to MCCs must make sense. I have been long associated with an MCC which I believe is the only one in England and Wales so favoured. I use the word "favoured" quite deliberately. But the corollary of this is that legal matters must be left in the domain of the justices' clerk.
I quote one example. Since criminal justice Bills have been annual events for the past 10 years, training takes on even greater importance in all magistrates' courts. The only people who are qualified to give such instruction are justices' clerks. I would be grateful to receive the assurance of the Minister that the role of the justices' clerk in that area of training is absolutely guaranteed. Were the task to be undertaken by anyone else there would not be the necessary guarantee of impartiality. For example, who is to say that a spin in favour of a government's desired option may not be imparted to some new legal provision?
There are other duties that should be undertaken by justices' clerks. Can anyone honestly contend that listing is not one of them? So that I should not be thought to be one of the unhelpful diehards, in principle, I do not see why the collection of fines, other than judicial decisions relating to enforcement, cannot come within the compass of a justices' chief executive. I believe that that is an administrative function.
I return however to the overriding concern created in these clauses which is the threat to the independence of legal advisers. Unless one clearly delineates—the Minister has been kind and wise enough to refer to the difficulty over nomenclature that arose when we discussed the Police and Magistrates' Courts Act—one has a grey area. If I understand it correctly, the magistracy says that there should not be any grey areas but only black and white areas so that everyone knows where they stand. Let the justices' chief executives and justices' clerks know what they can and cannot do. The purpose of my amendment is to refer to the correct description of the duties of the justices' clerk in the Justices of the Peace Act 1997. I beg to move.
Lord McIntosh of Haringey: I am grateful to the noble Viscount for proposing his four amendments together. It is more sensible. Amendments Nos. 322A and 322B propose changes to Clause 60, which addresses the role of the justices' chief executive. The effect of the amendments—although they are technically defective—is to extend the protection from direction provided in Section 48 of the Justices of the Peace Act

1269
1997. I believe that the amendments are unnecessary. They seek to extend Section 48 when, as I said in response to the earlier amendment, what is needed is the correct application of Section 48.
The new Section 41 of the Justices of the Peace Act that Clause 60 introduces makes it plain that justices' chief executives may not give directions to justices' clerks in matters set out in Section 48.
I now turn to the two amendments to Clause 61. Clause 61 enables the magistrates' courts committee to separate the legal and administrative functions undertaken in the committee's area. Subsection (1) brings into effect Schedule 9 which makes amendments to existing legislation, transferring certain administrative functions of justices' clerks to justices' chief executives. Transferring the responsibility for those tasks will enable the chief executive to delegate to any appropriate member of staff which may, of course, include the justices' clerk. That is a decision that can be made locally.
I turn to Amendment No. 326YA, the effect of which would be to further qualify the description of administrative functions. As I said, I do not intend to transfer the responsibility from the justices' clerk to the justices' chief executive for the provision of legal advice generally; nor do we wish to interfere in the relationship between the justices' clerk and the Bench of magistrates.
The noble Lord, Lord Phillips of Sudbury, referred to the wording of subsection (5). The purpose of that subsection is to give reassurance. However, we are willing to look again at the drafting of subsection (5) in the light of what has been said. In turn, that could have an effect on the wording of Clause 60 that we have debated already. To that extent, there is an opening.
Finally, I turn to Amendment No. 326ZA, the effect of which would insert two new subsections in Clause 61. I said earlier that it is not the role of the chief executive to interfere in individual cases. The chief executive cannot and must not interfere in the judicial process which is fully protected within the existing provisions of Clause 48 of the Justices of the Peace Act 1997. The further definition that subsection (7) would introduce specifies a description of judicial function for justices' clerks which is simply not acceptable. It would bring about exactly the position I mentioned earlier where the chief executive was prevented from giving directions to justices' clerks on matters of information such as good practice. I recognise that that is a sensitive area. It is appropriate to discuss the matter now and the department is in consultation and correspondence with a number of interested parties on these matters. It is vital to preserve the integrity of proceedings in the magistrates' courts and we believe that the provisions in Clauses 60 and 61, subject to what I said about subsection (5), will serve to achieve the delivery of better quality legal advice to lay justices while simultaneously ensuring that the responsibility for the efficient administration is appropriately placed with the chief executive.
1270
As I said, I shall consider any further representations, and if necessary bring forward further amendments. I hope the noble Viscount is reassured and that he will therefore withdraw his amendment.
Viscount Tenby: I am grateful to the noble Lord the Minister for his courtesy in dealing so fully with this important matter - and it is important. I may be suffering from late night languor, but I hope I have detected a chink of light and sweet reasonableness in what he said. I shall wait until the cold light of morning to study it more closely. In the meantime, I beg leave to withdraw the amendments.
Amendment, by leave, withdrawn.
[Amendment No. 322B not moved.]
Clause 60 agreed to.
Clause 61 [Transfer of administrative functions of justices' clerks]:
Lord Gisborough Lord Gisborough moved Amendment No. 323:
Page 37, line 16, leave out subsections (2) to (4).
The noble Lord said: Most of the points I would have made have been covered. However, I wish to raise two matters.
First, the noble and learned Lord the Lord Chancellor should not by statutory instrument be allowed to amend what is and what is not administrative. It must be a matter which Parliament alone should determine because of the consequences of judicial independence.
Secondly, I am not entirely sure that the noble and learned Lord has considered all the ramifications which transferring control functions to the justices' chief executive will cause in relation to the European Convention on Human Rights. Will the justices' chief executive appear in person when prosecuting fine or maintenance defaulters as the justices' clerk will no longer be able to act in the same capacity of collecting officer because of the danger of partiality? I beg to move.
Lord McIntosh of Haringey: I am grateful to the noble Lord for not repeating the arguments which we have adequately rehearsed, so I shall respond only to his specific points.
The noble Lord complains that subsection (2) provides for the Lord Chancellor to make an order by statutory instrument to transfer administrative functions and says that this should be a matter of primary legislation. I cannot accept that, and neither did the Delegated Powers and Deregulation Committee. These are matters which may change from time to time and it would be clumsy for it to wait for a suitable opportunity to come back to Parliament.
The noble Lord's second point is more technical. If I may, I shall write to him on that. On that basis, I hope that he will withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 324 to 326YA not moved.]
Lord Kingsland Lord Kingsland had given notice of his intention to move Amendment No. 326ZA:
Page 37, line 31, at end insert—
("(6) In performing a duty or function imposed or conferred on him by section 41 of the Justices of the Peace Act 1997 or by or under any other enactment, a justices' chief executive must not do anything which—

(a) amounts to performance of a judicial function, or

(b) might influence anything done by a justice of the peace or justices' clerk in the performance of a judicial function.

(7) For the purposes of subsection (6), a judicial function is—

(a) any function of a justice of the peace, and

(b) any function of a justices' clerk which is not an administrative function.").

The noble Lord said: I spoke to the amendment when addressing Clause 59. The noble Lord has effectively replied to it in the course of his various replies to the noble Viscount, Lord Tenby, and my noble friend Lord Gisborough. I shall therefore not move the amendment.
[Amendment No. 326ZA not moved.]
Clause 61 agreed to.
Schedule 9 agreed to.
Clauses 62 to 65 agreed to.
Clause 66 [Execution by person not in possession of warrant]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 326A:
Page 41, line 42, after ("order);") insert—

("( ) a warrant under paragraph 4 of Schedule 3 to the Crime and Disorder Act 1998 (unwilling witnesses);

( ) a warrant under paragraph 3(2) of Schedule 1 to the Youth Justice and Criminal Evidence Act 1999 (offenders referred to court by youth offender panel);").

The noble Lord said: In moving Amendment No. 326A, I speak also to Amendments Nos. 326B and 331. These amendments make minor technical changes to Clause 66 and Schedule 11 to ensure consistency with certain provisions in the Youth Justice and Criminal Evidence Bill and the Crime and Disorder Act 1998.
Clause 66 of the Access to Justice Bill inserts a new Section 125 into the Magistrates' Courts Act 1980. Among other things this draws a distinction between those warrants which only a police officer may execute without the warrant being in his possession, and the warrants that may also be executed by civilians in similar circumstances. The list of warrants that may be executed by the police alone is identical to that which currently appears in Section 125 of the Magistrates' Courts Act.
However, provisions in the two other statutes, both of which affect the list in the current Section 125, are due to be introduced before Clause 66 is implemented. Paragraph 44 of Schedule 8 to the Crime and Disorder Act 1998 adds to the list warrants for the arrest of a reluctant witness. Paragraph 7 of Schedule 3 to the Youth Justice and Criminal Evidence Bill will also, if enacted, add to the list warrants for the arrest of an offender referred to the court by a youth offender panel. The amendment to Schedule 11 therefore provides for their appeal once Section 66 comes into force. The amendments to Clause 66 itself ensure that these
1272
provisions are added to new Section 125C which will re-enact the existing list of warrants which a constable may execute without the warrant being in his possession. I beg to move.
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 326B:
Page 41, line 43, leave out ("or 97") and insert (", 97 or 97A").
On Question, amendment agreed to.
Clause 66, as amended, agreed to.
Clause 67 agreed to.
Clause 68 [Justices and clerks: immunity from costs]:
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 326C:
Page 43, line 3, leave out from beginning to ("House") in line 6 and insert ("No regulations may be made under subsection (4) above unless a draft of the statutory instrument containing them has been laid before, and approved by a resolution of, each").
The noble and learned Lord said: The government amendments to Clauses 68 and 72 provide that regulations under these clauses should be made by affirmative procedure.
The government amendments do not, however, cover the provisions in Clause 68 relating to Northern Ireland. The position in relation to Northern Ireland is different, for reasons I will explain. I therefore ask your Lordships to reject Amendment No. 327, the purpose of which is to provide that Northern Ireland regulations should also be subject to the affirmative procedure.
Clause 68 inserts a new section into the Justices of the Peace Act 1997 to give justices of the peace and others immunity against costs orders. It makes similar provisions in respect of resident magistrates, justices of the peace and clerks of petty sessions in Northern Ireland.
Clause 72 inserts a new Section 2A into the Taxes Management Act 1970 to provide general commissioners of income tax with immunity from costs, or in Scotland expenses, arising from the execution of their duties.
To protect the interests of other parties to any proceedings, each of the new provisions also gives a court the power to order payment by the Lord Chancellor of costs which would, but for the new provisions, have been ordered to be paid by the judicial officer who was party to the proceedings. In respect of general commissioners of income tax in Scotland, expenses may be ordered to be paid by the Secretary of State.
The clauses provide for the Lord Chancellor, or in Scotland the Secretary of State, to make regulations specifying the circumstances in which a court may exercise its power to order payment of costs and how the amount of any costs award is to be determined. Under the clauses as they are drafted those regulations would be made under negative resolution procedure.
The Delegated Powers and Deregulation Committee concluded that the regulations should be subject to additional parliamentary scrutiny provided by the affirmative resolution procedure.
The Government recognise that the regulations will deal with the exercise of the discretion of the courts. My noble and learned friend the Lord Chancellor has accepted the conclusion of the Delegated Powers and Deregulation Committee on this point and brings forward these amendments accordingly. However, as I have said, an exception needs to be made in respect of the procedure for Northern Ireland regulations.
The effect of Section 2 of Clause 68 is to amend the Magistrates' Courts (Northern Ireland) Order 1981. The practice is that subordinate legislation under an Order in Council under the Northern Ireland Act 1974 is made under negative procedure. The fundamental reason for this is wholly practical. Parliament simply could not give enough time to deal with Northern Ireland subordinate legislation if it were dealt with on an equivalent basis to subordinate legislation for England and Wales. This is a problem which I hope political progress in Northern Ireland will eventually resolve. In the meantime, I believe it right to maintain the principle that has been followed since 1974 in respect of Northern Ireland legislation and therefore to provide for Northern Ireland regulations to be made under negative procedure.
My noble and learned friend the Lord Chancellor realises that he is not fulfilling the letter of the commitment given earlier, in the light of the Select Committee report, to make Clause 68 subject to affirmative resolution. I am sure that the Committee will understand why, on reflection, he felt that Northern Ireland practice should be maintained. He is happy to provide the affirmative resolution for the powers in Clause 68 which cover England and Wales and the powers in Clause 72 which are UK-wide.
On Question, amendment agreed to.
[Amendment No. 327 not moved.]
Clause 68, as amended, agreed to.
Clauses 69 to 71 agreed to.
Clause 72 [General Commissioners: immunity from costs and expenses]:
The Deputy Chairman of Committees (Lord Lyell): I must advise the Committee that if Amendment No. 327A is accepted, I shall not be able to call Amendment No. 328.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 327A:
Page 45, line 10, leave out from beginning to ("House") in line 12 and insert ("No regulations may be made under subsection (4) above unless a draft of the statutory instrument containing them has been laid before, and approved by a resolution of, each").
On Question, amendment agreed to.
[Amendment No. 328 not moved.]
Clause 72, as amended, agreed to.
Clause 73 agreed to.
Clause 74 [Indemnity]:
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 328A:
Page 46, line 22, leave out ("against him").
The noble and learned Lord said: In moving this amendment, I shall speak also to Amendments Nos. 328B to 328D. Clause 74 amends the Coroners Act 1988 to make provision for coroners to be indemnified by their councils where they are respondents in legal proceedings brought against them in the course of their coroner duties. The purpose of this amendment is to extend the scope of that indemnity so that coroners may also be reimbursed in cases where they have initiated legal proceedings in their capacity as coroners.
Coroners will rarely need to take such action. However, after an inquest has been completed and the verdict given, it sometimes emerges that a mistake or error has been made which cannot be corrected other than by re-opening the inquest; or else new evidence comes to light which casts doubt on the verdict and which might justify a new inquest. In these circumstances, a coroner has no power to overturn the original inquest but may apply to the High Court for an appropriate order for a fresh inquest.
If a coroner decides to pursue such a course, his paying authority—the local council—is not at present required to reimburse him either his costs in bringing the proceedings, nor any costs which might be awarded against him as a result of the proceedings. Nor does the present clause offer the coroner protection since it limits indemnification to costs arising from proceedings brought against him.
The amendment is designed to rectify this anomaly. However, while we believe it is proper to require councils to reimburse coroners their costs where proceedings have been brought against them, we consider that, if the proceedings are to be brought by the coroner, it would be right to provide the council with an opportunity, in advance, to consider whether or not to indemnify the coroner in the light of the circumstances of the particular case. This would enable the council to consider, for example, whether it was reasonable to incur the costs which were likely to arise. In the event that a council refused consent, the coroner should have the opportunity to appeal, and the amendment provides for such an appeal to be made to the Secretary of State or to someone appointed by him for that purpose.
The amendment is concerned with providing proper protection both for coroners and their councils in circumstances where a financial liability may arise. It does not alter or limit the opportunities for applications to be made to the High Court for fresh inquests. I beg to move.
Lord Phillips of Sudbury: The proposed subsection (1A) refers to agreement "in advance". It seems to me that those words "in advance" may cause problems.
Lord Falconer of Thoroton: Perhaps I may write to the noble Lord on that matter.
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendments Nos. 328B to 328D:
Page 46, line 32, at end insert—
("(1A) Subsection (1) above applies in relation to proceedings by a coroner only if and to the extent that the relevant council agrees in advance to indemnify him.
(1B) A coroner may appeal to the Secretary of State, or to any person appointed by the Secretary of State for the purpose, from any decision of the relevant council under subsection (1A) above.").
Page 47, line 17, leave out ("against him").
Page 47, line 27, at end insert—
("(2) Subsection (1) applies in relation to proceedings by a coroner only if and to the extent that the Lord Chancellor agrees in advance to indemnify him.").
On Question, amendments agreed to.
Clause 74, as amended, agreed to.
Clause 75 agreed to.
Schedule 10 [Transitional provisions and savings]:
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 328E:
Page 100, line 14, at end insert—
("Lord Mayor and aldermen of City of London
. The person who is the Lord Mayor of London, and the persons who are aldermen of the City of London, at the end of the period of two months beginning with the day on which this Act is passed shall be treated as having at that time been appointed in accordance with section 5 of the Justices of the Peace Act 1997 as justices of the peace for the commission area which includes the City of London; and, accordingly, subsection (1A) of section 6 of that Act (inserted by paragraph 23A of Schedule 7 to this Act) has effect in relation to them.").
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 328F:
Page 100, line 20, at end insert—
(" . Any person who, immediately before the time when section 52 of this Act comes into force, is authorised under section 13(1)(a) or 19 of the Justices of the Peace Act 1997 to act as a stipendiary magistrate or metropolitan stipendiary magistrate shall be treated as having been appointed to be a Deputy District Judge (Magistrates' Courts) at that time for the remainder of the period for which he is so authorised.").
The noble and learned Lord said: With Amendment No. 328F I propose to make an amendment to Schedule 10, Part V, paragraph 20, in order to ensure that transitional arrangements are in place for the continued administration of justice by those acting stipendiaries who, when Clause 52 of the Access to Justice Bill becomes law, will be known as deputy district judges (magistrates' courts).
This amendment will allow for any person acting as a stipendiary magistrate or a metropolitan stipendiary magistrate immediately before Clause 52 comes into force to be taken as having been appointed to be a deputy district judge (magistrates' courts) at that time and his appointment to act will be treated as being for such period as represents the remaining duration of his authorisation to act as a stipendiary had Clause 52 not come into force.
Amendment No. 328G is proposed to deal with the changes of date of commencement of Clause 52 and the effect that that will have on paragraph 38 of Schedule 8 which makes transitional provisions in respect of the Legal Aid Act 1988. The three minor amendments, Amendments Nos. 332, 333 and 334, which I propose
1276
to Clause 78 will have the effect of altering the commencement of the provisions of Clause 52 of the Access to Justice Bill from two months after the Bill receives Royal Assent to such day as the Lord Chancellor may, by order made by statutory instrument, appoint.
The reason for this is that there are a number of existing statutory instruments which refer to stipendiary magistrates, metropolitan stipendiary magistrates or the chief metropolitan stipendiary magistrate which will need to be amended to substitute the title district judge (magistrates' courts) or senior district judge (magistrates' courts) and we wish to ensure that all those changes are made at the same time. I beg to move.
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 328G:
Page 101, line 2, leave out from beginning to ("District") in line 6 and insert ("If paragraph 38 of Schedule 8 to this Act comes into force before the repeal by this Act of section 19(5) of the Legal Aid Act 1988, that provision shall have effect as if, in the definition of "proceedings for dealing with an offender as a fugitive offender" the reference to a metropolitan stipendiary magistrate were to a").
On Question, amendment agreed to.
Schedule 10, as amended, agreed to.
Clause 76 agreed to.
Schedule 11 [Repeals and revocations]:
[Amendments Nos. 329 and 330 not moved.]
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 330A:
Page 106, line 14, at end insert—

("6 & 7 Vict. c. 86.

The London Hackney Carriages Act 1843.

In section 24, the words from ", or, if he shall dwell" to "the said city,", the words "or justice" and the words ", or to some justice as aforesaid,".

16 & 17 Vict. c. 33.

The London Hackney Carriage Act 1853.

In section 18, the words from "or if the offence,", in the second place, to the end.")

On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendments Nos. 330B to 330L:
Page 106, line 28, column 3, at beginning insert—

("In section 38(1), the definition beginning "London commission areas".")

Page 106, line 31, at end insert—

("1974 c. 47.

The Solicitors Act 1974.

Section 38(4).")

Page 106, line 38, column 3, leave out ("67(4), the second sentence") and insert ("67, in subsection (4), the second sentence and subsection (8)").
Page 107, line 10, column 3, at end insert—

("In Schedule 11, in paragraph 8(d), the words "and (8)".")

Page 107, line 28, column 3, at beginning insert—

("Section 5(2)(b) and the preceding "and". In section 7(3), the words from "(whether" to "acting Chief Magistrate)". Section 21 (and the preceding heading). Section 23.

In section 25, in subsection (1), the words ", other than the City of London," and subsection (3).")

Page 107, line 34, column 3, leave out from ("section") to end of line 35 and insert ("70, in subsection (1), the words from the beginning to "above," and, in subsection (2), the words "or to justices or magistrates for a county or non-metropolitan county" and the words "or to justices or magistrates for the City".").
Page 107, line 50, column 3, after ("14,") insert ("16(b) and the preceding "and",").
Page 108, line 4, at end insert—

("16 & 17 Vict. c. 33.

The London Hackney Carriage Act 1853.

In section 18, the words from "or if the offence,", in the second place, to "for the county;".")

Page 108, line 33, column 3, at end insert—

("In section 9(1), the words from "consisting" to the end.")

Page 108, column 3, leave out lines 40 and 41 and insert ("5(1)(b), the words "a metropolitan magistrate or" and paragraph 13(2).").
The noble and learned Lord said: With the leave of the Committee I shall move Amendments Nos. 330B to 330L en bloc. I beg to move.
On Question, amendments agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 331:
Page 111, line 18, at end insert—

("1998 c. 37.

The Crime and Disorder Act 1998.

In Schedule 8, paragraph 44.

1999 c. 00.

The Youth Justice and Criminal Evidence Act 1999.

In Schedule 3, paragraph 7.")

On Question, amendment agreed to.
Schedule 11, as amended, agreed to.
Clause 77 agreed to.
Clause 78 [Commencement]:
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 332:
Page 48, line 2, leave out (" 52") and insert (" 51").
On Question, amendment agreed to.
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendments Nos. 333 to 335:
Page 48, line 2, leave out ("Schedules 7 and 8") and insert ("Schedule 7").
Page 48, line 4, leave out (", (2)").
Page 48, line 4, at end insert (", apart from the provisions specified in subsection (3).
(3) The provisions excepted from subsection (2)(e) are the repeal of section 67(8) of the Magistrates' Courts Act 1980 (and that in Schedule 11 to the Children Act 1989) contained in Part IV(1) of Schedule 11.").
The noble and learned Lord said: With the leave of the Committee I shall move Amendments Nos. 333 to 335 en bloc. I beg to move.
On Question, amendments agreed to.
Clause 78, as amended, agreed to.
Remaining clauses agreed to.
House resumed: Bill reported with amendments.
House adjourned at a quarter before one o'clock.