Lords Sitting of 4 March 1999

Preamble
The House met at three of the clock (Prayers having been read earlier at the Judicial Sitting by the Lord Bishop of Bristo.): The LORD CHANCELLOR on the Woolsack.

Student Debt
Lord Tope Lord Tope asked Her Majesty's Government:
Whether the current and future levels of student debt are having harmful effects on the health of university students.
The Minister of State, Department for Education and Employment (Baroness Blackstone): My Lords, for new students we have introduced student loans with income-contingent repayments. Repayments will be fairer because they will be based on the graduate's income. They will be easier because for most graduates, they will be collected with income tax and national insurance contributions. The interest charged is linked to the rate of inflation, not to commercial rates. The sum repaid will be broadly the same in real terms as that borrowed. There is no reason for any borrower to he worried about the terms of these loans.
Lord Tope: My Lords, I am grateful to the Minister for that reply. It may well be that in years to come the situation will improve. Has the Minister studied the research recently published by Dr. Ron Roberts and others of the Department of Psychology at the University of Westminster and the Imperial College of Science, Technology and Medicine which established a very clear link between poor mental health and student debt? Does the Minister agree that the evidence that they produced was quite alarming? If she has not already done so, will she ask her department to take a close look at the current situation?
Baroness Blackstone: My Lords, I am grateful to the noble Lord, Lord Tope, for referring to the study by Dr. Roberts, which I have seen. Unfortunately, for a variety of different methodological reasons, one must be very careful about jumping to conclusions on this research. The sample was very small and the research was undertaken at only two universities. In some cases the conclusions are based upon a very small number of replies—as few as 13—and the comparisons made with the general population are not really valid because in many cases they go right back to 1987. I do not believe that the study adequately attributes stress and poor health to financial problems; it does not really make the links. However, that does not mean that the Government should not be very careful to look at the impact of the new arrangements. My department has asked for research based on a very large sample—2,000 full-time and 1,000 part-time students—to be undertaken this summer. We shall he reporting on that study next spring.
Lord Pilkington of Oxenford: My Lords, does the department have any evidence of students who have
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student loans suffering disadvantage in getting a mortgage'? I have heard that sometimes banks refuse to give mortgages in those circumstances.
Baroness Blackstone: My Lords, I have no evidence of that, but I would be concerned if the income of a student otherwise justified the grant of a mortgage. If the noble Lord can give me any information about that, I should be very happy to take it up.
Baroness Maddock: My Lords, I am very interested in the reply that the Minister gave to my noble friend. Those of us who sat through the debates on the Teaching and Higher Education Bill asked for many assurances that the Government would keep an eye on what happened to students. It is obvious to many of us that there is increasing evidence that for students day-to-day living is becoming a problem. Can the Minister give the House further assurances that any research that the department carries out will he robust? Further, can she provide a timetable to indicate how that fits into any reviews or promises made during the passage of the Teaching and Higher Education Bill?
Baroness Blackstone: My Lords, the survey is part of the commitment that I made when that Bill was passing through your Lordships' House. I said that the effects of the new arrangements would be monitored, and the student income and expenditure survey to be carried out this summer is part of that. It will certainly be robust and will look at all aspects of students' living costs, including the way in which they spend money. We shall certainly want to look at any health problems experienced by students.
Lord Annan: My Lords, does the noble Baroness understand that it is a great reassurance to hear that a really critical study of such evidence, as has been produced by the University of Westminster, has been carried out? Not all research that comes out of universities into these problems is necessarily trustworthy.
Baroness Blackstone: My Lords, I am very glad to be reminded by the noble Lord, Lord Annan, that not all research is valid and reliable.
Lord Hayhoe: My Lords, does the noble Baroness accept that a significant number of families in this country regard with repugnance getting into debt and that for many its avoidance is an old-fashioned virtue? Will she ensure that the current research takes that into account when the findings, to which we shall look forward, are published?
Baroness Blackstone: My Lords, I shall certainly ensure that that is taken into account. I do not believe that there is any evidence that, since the Student Loans Scheme was introduced under the government of which the noble Lord was a member, there has been a fall-off in the number of students who apply to go to university. It is interesting that in the five years following the

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introduction of the loans scheme there was an increase in applications, in particular from students of low income backgrounds.
Baroness Blatch: My Lords, does the noble Baroness agree that the vulnerable time for students is as they come to the end of their first year, having had to borrow the whole of their maintenance and pay all or part of their tuition fees? They then have to borrow again for their second and third years. It is at that stage that they may consider that the level of debt is too great and therefore they should not continue with their studies. Will that be taken into account in any survey that is carried out?
Baroness Blackstone: My Lords, the Government would be very concerned if any student gave up his or her studies because of financial problems. We shall be looking into the different points at which, during a student's experience at university or college of higher education, it appears that there is a greater likelihood of dropping out of courses. There are many different reasons why students drop out; financial problems is only one of them.

Pension Schemes: Reduction in Interest Rates
3.8 p.m.
Baroness Castle of Blackburn Baroness Castle of Blackburn asked Her Majesty's Government:
What will be the effect on the level of pensions available under money purchase funded pension schemes as a result of the recent reduction in interest rates from 7½ to 5½ per cent.
The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham): My Lords, the overall impact on pension income of the recent reduction in interest rates over the period of retirement is difficult to assess. However, all pensioners and pension funds will benefit from a strong economy with consistently low inflation.
Baroness Castle of Blackburn: Is the Minister aware that we are all in favour of low interest rates and low inflation? However, did my noble friend read the leading article in the Observer of a fortnight ago which pointed out that the combination of economic benefits had drastic implications for pensions policy, particularly that based on encouraging money purchase schemes? Is my noble friend aware that the benefits to which she referred are little compensation to pensioners like the gentleman from Andover who wrote to me to point out that annuity rates had halved in the past 10 years and that his life's savings of £100,000 would today buy an annuity worth only £4,500? Will she not therefore agree with the Observer, which states that the whole
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assumption on which current pensions policy, which encourages money purchase funded schemes, is based, ought to be and will have to be rethought completely?
Baroness Hollis of Heigham: My Lords, my noble friend quotes a letter, which I have not seen, in which somebody states that annuity rates have halved in the past decade. A decade ago, inflation was at 14 per cent. and annuity rates were at 15 per cent. I believe that my noble friend underestimates the impact of inflation on pensioner savings. For example, during the entire period of the previous government, inflation was at 6.6 per cent. Under the present Government it is now 2.4 per cent. A £1,000 annuity under an inflation rate of 6.6 per cent. would halve in a decade and be worth just over £500. But if inflation is at 2.4 to 2.5 per cent., that £1,000 annuity would be worth £800 over a decade. That is what matters to pensioners.
Lord Mackie of Benshie: My Lords, is the Minister aware that with his £100,000 a person must buy an annuity, thereby committing his capital? He would be far better to rely on interest rates and trust to his judgment?
Baroness Hollis of Heigham: My Lords, I accept that there is a dilemma for someone who is required to buy an annuity at a certain point in time. However, as the House will know, people are not required to turn a lump sum, or a pension pot, into an annuity until the age of 75. Therefore, they have between the ages of 65 and 75—in many cases 60 and 75—to decide when to turn the sum into an annuity. Given certain assumptions of growth—investment growth of, say, 7.5 per cent.—they can achieve a draw-down of income which will at least match the annuity rate without eating into the capital.
Baroness Turner of Camden: My Lords, does my noble friend agree that, while we all welcome a reduction in interest rates, there is a downside? Many older people have looked upon income from savings as a way of boosting inadequate pensions. Therefore, to tell such people that low inflation will provide them with some protection will not help them very much if they experience an immediate drop in their income, as is now the case. What will the Government do to encourage people to save in such circumstances, since, quite rightly, it is government policy to encourage people to save as much as possible?
Baroness Hollis of Heigham: My Lords, the noble Baroness is right. However, I recall that about a decade ago, when inflation was at its highest level, people were least inclined to save and to opt for the older fashioned virtue of thrift because they saw the value of their savings being eaten away. Without trying to underestimate the significance of the issue, it is wise to put it into context. On average, occupational pensions represent about one-fifth of the average pensioner's income. Approximately 90 per cent. of people who have an occupational pension receive a final salary funded scheme and therefore benefit from low inflation rates.

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The number of pensioners whose pension is a substantial part of their income, is money purchase funded and therefore vulnerable to interest rates is a small proportion of the population.
Lord Higgins: My Lords, I declare an interest as chairman of a company pension scheme, although not of the kind described in the Question. Is not the simple answer to the Question that interest rates will be less and the level will be lower? In particular, is it also not clear that, if retiring today, people are receiving substantially less than they expected a year ago? Therefore, is not the Green Paper about the government forecasts of people's pensions completely unrealistic? Is it not likely that such forecasts will he grossly misleading?
Baroness Hollis of Heigham: My Lords, we have no reason to think so. I agree that one cannot always read into the future what happened 15 years ago. However, on average, pensioners' incomes have more than kept pace with earnings. It is clear that when interest rates are high, which is usually a consequence of high inflation, overall, pensioners have lost out because there is a transfer of money from savers to borrowers; younger people buy houses and the like. Traditionally, pensioners do better in a low inflation/low interest rate economy. For future pensioners, their best hope and expectation of having a decent private pension as they reach retirement is to have secure, well-paid jobs in a sound economy based on investment. That is what we are determined to secure.
Lord Goodhart: My Lords, I accept much of what the Minister says, but does the noble Baroness agree that the real threat to the level of pensions came from the Government's decision last year to abolish the tax credit on the dividend income of pension funds?
Baroness Hollis of Heigham: My Lords, first, we believe that the best investment for a pension is a sound economy. We do not believe that that should depend on tax distortions in the pension system. Secondly, it is worth emphasising that the value of ACT when it was renewed was one-tenth of the difference between the best and the worst performing funds in any sector of the pensions industry. In other words, what matters is choosing your manager.
Baroness Gardner of Parkes: My Lords, is the Minister aware that many people become anxious as they approach the age limit of 75? Will the Government consider raising that limit so that those who are terrified of being forced to take an annuity may wait longer?
Baroness Hollis of Heigham: My Lords, I recognise the problem faced by those approaching the age of 75. The Government are considering that issue, but I cannot reassure the noble Baroness that any changes are in prospect.
Baroness Castle of Blackburn: Is it not a fact that the Government are actively discouraging final salary
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funded schemes and actively encouraging money purchase funded schemes, including those to be bound up in the stakeholder pension? Does this situation not mean, as the Observer points out, that you would have to accumulate life savings of some £200,000 to get a pension of £10,000 a year, not exactly an over-lavish sum? That is why the Observer calls for a complete rethinking of the basis of the Government's pensions policy.
Baroness Hollis of Heigham: My Lords, I do not accept that the Government are actively encouraging money purchase funded schemes in the sense that the number of schemes which are money-purchase compared with final salary have not changed, slightly to my surprise, during the past two or three years. The number remains the same, although there has been a growth in hybrid schemes; a mixture of schemes.
As my noble friend will he aware, the stakeholder scheme is a money purchase funded scheme because it tries to meet the needs of those people for whom final salary occupational schemes do not make good sense. Such people are in and out of work; they may have had part-time employment or broken employment; they may be women who have had caring responsibilities; or be self-employed. Such people may stay in a job only two or three years and it would be absurd to expect them to take up a final salary funded scheme. However, the Government's stakeholder scheme, compared with the usual money purchase or personal pension scheme, will have low charges, assured basic standards of competence and a good return, making it possible for people for whom no suitable pension product has been available to enjoy a comfortable old age.

Captive Wild Animals: Protection
3.19 p.m.
Viscount Falkland Viscount Falkland asked Her Majesty's Government:
Whether it is time to strengthen the law with regard to the use of wild animals trained for entertainment purposes.
The Minister of State, Home Office (Lord Williams of Mostyn): My Lords, we presently believe that adequate legislation is in place. Wild animals trained for entertainment purposes are protected by the Protection of Animals Act 1911, the Performing Animals (Regulation) Act 1925 and, in certain circumstances, by the Dangerous Wild Animals Act 1976.
Viscount Falkland: My Lords, I thank the Minister for his reply. Is he aware of the recent report of the circus working group of the RSPCA, to which many relevant bodies contributed, which shows that there is great cause for concern? Taken together with the quite deplorable case of the Chipperfield chimpanzees, if I may so describe it, is there not now serious concern that we are past the stage when wild animals, many of which come from species under threat, should be

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brought in and trained for entertainment purposes? That is against a background of falling attendances at circuses which further aggravate the financial pressures and which may well, in turn, affect the animals' welfare?
Lord Williams of Mostyn: My Lords, I have in fact read the report. The Associate Parliamentary Group for Animal Welfare intends to consider the report formally within a matter of weeks. The executive summary of the report states:
"There is unanimous agreement that further research would be a necessary pre-requisite of any legislative changes".
So it is not entirely clear-cut.
Lord Renton: My Lords, does the Minister agree that the present legislation does not prevent wild animals being confined in small cages, drugged and sometimes chastised in order to perform an unnatural kind of entertainment, all of which is surely cruel? Should we not now try to do something about that?
Lord Williams of Mostyn: My Lords, any intentional infliction of harm to animals is against the criminal law. Reference has been made to the recent high profile case but, in fact, that was a successful prosecution. The law is there to protect against the infliction of harm and damage to domestic and captive animals.
Viscount Mountgarret: My Lords, to carry the question of the noble Lord, Lord Renton, further, would it not be relatively simple to ban the use of wild animals for entertainment generally across the board?
Lord Williams of Mostyn: My Lords, that would be a possibility. It is certainly something I imagine the associate group will want to consider. The Chief Whip reminds me that, in his view, the duty of training wild animals for entertainment purposes ought really to be with him, not me!
Baroness Trumpington: My Lords, arising from the recent high profile case to which reference has been made, is it true that a loophole in the law allows a person who has been found guilty of mistreating an animal to have the animal returned to him after the case? I believe that that applies not only to wild animals but also to horses.
Lord Williams of Mostyn: My Lords, the law allows a court to deprive a convicted person of ownership of an animal for any period. It can order the disposal of an animal, appropriately, if the court is satisfied that to leave the animal with its owner would expose it to further cruelty. In respect of the particular chimp, Trudy, officials have checked today. She is now living at Monkey World in Dorset. She and her fellow chimps have 40 acres in which to wander. The leader of the
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group is called Rodney, aged 30. The adoptive mother is Peggy, aged 15. Plainly, the age of consent in that particular context is what the Commons are suggesting.
Baroness Trumpington: She is better off than me!
Lord Williams of Mostyn: It shows that if employment in this House passes, there may be alternatives available.

Local Authorities: Road Maintenance Budget
3.24 p.m.
Lord Brabazon of Tara Lord Brabazon of Tara asked Her Majesty's Government:
Whether, as indicated by a survey by the Refined Bitumen Association published on 1st March 1999, there is a £1.5 billion shortfall in this year's local authorities' road maintenance budget, and whether this shortfall has increased by 25 per cent. over the past year.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): My Lords, while it is generally accepted that road maintenance has suffered from past underfunding, there is no agreed estimate of the size of the backlog of maintenance for local roads.
Local government in Great Britain has substantial discretion in setting expenditure priorities and full information on local highway condition is not available. But we are now committed to restore the cuts in maintenance of English principal roads.
After devolution the Scottish Parliament and Welsh Assembly will be responsible for funding local authorities in Scotland and Wales to discharge their functions in respect of local roads.
Lord Brabazon of Tara: My Lords, I thank the Minister for that Answer, but is he aware—of course, he will be—that particular reference is made in the White Paper to better maintained roads and increased resources, both locally and nationally? Therefore, what will the Government do about this growing shortfall in what is, after all, 95 per cent. of our roads; namely, local authority roads? The White Paper also proposes the transfer of some 40 per cent. of government trunk roads to local authorities. Can the Minister give the House an assurance that money for maintenance will also follow that transfer, and that that money will be ring-fenced so that it has to be spent on road maintenance and not used for other purposes?
Lord Whitty: My Lords, in answer to the first point, the Government have clearly shifted resources, as compared with the previous administration. We have allocated a further £276 million over the three-year period of the CSR. The capital settlement for local roads has been allocated a 34 per cent. increase for next year. Therefore, we are very substantially moving towards our

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commitment to restore spending on maintenance for local roads. As regards detrunking proposals, there will clearly have to be a financial arrangement between the Highways Agency and the local transport authorities. That will involve adequate financial resources, both on current maintenance and future capital spending on major road maintenance programmes.
Lord Swinfen: My Lords, does a contractor who repairs a road have to guarantee that the road will remain in good condition under normal usage for a specific time? If the road fails to stay in good condition, does the contractor have to return and restore it to a satisfactory condition?
Lord Whitty: My Lords, within certain constraints, penalty clauses are involved in maintenance contracts. Many such contracts run for a number of years and are adjudged between the local authority, or indeed the highways authority, and the contractor. However, penalty clauses are involved.
Baroness Thomas of Walliswood: My Lords, will the Minister accept that those of us who have been involved in this matter at a local level do not find surprising the figures referred to in the Question asked by the noble Lord, Lord Brabazon of Tara? It has been said that there is no way of measuring the shortfall. Is the Minister aware that in many counties the life expectancy, if I may use that phrase, of the roads in the care of the counties has been steadily declining for at least 10 years? As far as I know, that trend has not changed; the figure is still decreasing.
Lord Whitty: My Lords, the noble Baroness is clearly correct. A substantial problem is involved here and the responsibility for that is quite clear. Indeed, the report to which the Question refers indicates that there was a substantial deterioration over the period of 10 years to 1998. That is because the previous administration froze current expenditure allocated to local authorities and dramatically cut the capital expenditure for local authorities. As I indicated in my previous answer, this Administration reversed that situation on both fronts and, over the period of the Comprehensive Spending Review, will be moving towards restoring it to the level which existed up until the early 1990s. There is a backlog, and we are tackling it.
Lord Dixon-Smith: My Lords, is the Minister aware that last year local authorities had to pay out £33 million as a result of successful claims for accidents or damage to vehicles caused as a result of the state of the structure of roads? Does he consider that the steps which the Government have taken are adequate to begin a trend of reducing that figure, which has shown steady growth now for a number of years?
Lord Whitty: My Lords, as I have indicated, we are only beginning to reverse a serious decline in resources. However, I believe that local authorities have recognised their responsibility in that respect and are improving the
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maintenance of the roads not only for the convenience of traffic, but to avoid the kind of incidents to which the noble Lord refers.
Lord Marlesford: My Lords, what is the purpose of, and justification for, detrunking?
Lord Whitty: My Lords, the intention, which is welcomed by local government generally, is to ensure that Highways Agency roads provide the country's strategic network. Detrunked roads will henceforth be assessed in terms of regional and local priorities and will be managed, along with local roads, by local authorities as part of the overall local and regional transport system. They are, therefore, roads which are more important for local and regional purposes than for national purposes. Nevertheless, they will remain as principal roads. As I have already said, the financial arrangements made for them will reflect that status.
Lord Bruce of Donington: My Lords, will the Minister clarify a small budgeting point arising from his announcement? A number of statements have been made about the Government's projected expenditure for the next three years. When does a "year" commence and end? Are we talking about a complete fiscal year or about a running period of time whereby a "year" can commence at any point during the fiscal year?
Lord Whitty: My Lords, as is the convention in such cases, the amounts allocated over the next three years relate to the financial year. The year therefore starts on 1st April.
Baroness Carnegy of Lour: My Lords, as the Government tell us every day that they are putting more money into something, does the Minister appreciate that if the Government continue to ring-fence the money that they give to local government, they take away the possibility of local government deciding its own priorities, which may well be roads? We heard this morning that many millions of pounds will he spent on reducing class sizes for children below the age of seven, but as that money is ring-fenced the local authorities cannot reduce class sizes in their own way but must do so precisely as instructed by the Secretary of State. That is not the way to improve the roads.
Lord Whitty: My Lords, the subject of class sizes is slightly beyond the scope of this Question. However, the usual criticism about road maintenance is that we do not ring-fence enough. Indeed, the SSA does not statutorily require a local authority to spend that money on roads and it is generally assumed that local authorities underspend on road maintenance. In fact, the actual expenditure tends not to be severely different from the amount allocated. As I said earlier, local authorities have substantial discretion with regard to the current expenditure which is not ring-fenced.

Business
3.32 p.m.
Lord Carter: My Lords, after the Second Reading debate on the Water Industry Bill, my noble friend Lord Sainsbury of Turville will, with the leave of the House, repeat in the form of a Statement an Answer to a Private Notice Question in another place on trade sanctions (USA).

European Parliamentary Elections (Gibraltar) Bill [H.L.]
Lord Bethell: My Lords, I beg to introduce a Bill to provide for electors in Gibraltar to vote in elections to the European Parliament. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Lord Bethell.)
On Question, Bill read a first time, and to be printed.

Health Bill [H.L.]
3.33 p.m.
The Parliamentary Under-Secretary of State, Department of Health (Baroness Hayman): 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.—(Baroness Hayman.)
On Question, Motion agreed to.
House in Committee accordingly.
[The PRINCIPAL DEPUTY CHAIRMAN OF COMMITTEES in the Chair.]
Clause 47 [Regulation of health care and associated professions]:
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 194:
Page 38, line 14, after ("Council") insert ("within the period of one year from the coming into force of this section").
The noble Lord said: In moving this amendment, perhaps I may say first what a pleasure it is to debate parts of this Bill in daylight. I thank the usual channels for that. We have now come to one of the most crucial parts of the Bill and it is good to be considering it at a time that will allow a considerable number of members of professions relating to healthcare to watch our proceedings with interest.
The effect of the amendment would be to ensure that the considerable powers of Clause 47 will be exercisable for only a single year. We on these Benches said at Second Reading that this so-called Henry VIIIth clause went far too far. As Members of the Committee will know, we were supported in that view by the Select Committee on Delegated Powers and Deregulation, which stated:
"Considerable concern has been expressed about the width of this power, and its effect on the principle of professional self-regulation. The Committee understands this concern. Orders may make changes to any aspect of professional regulation".
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That report was extremely balanced. It did not damn the whole of Clause 47. The Select Committee understood the need for flexibility but recognised that, as currently framed, the clause goes far too far. We have received representations on that point as, I am sure, have other Members of the Committee. Our amendment is designed to put a finite limit on the Government's ability to use the clause while it is of the breadth currently drafted.
At this stage, Amendment No. 194 is essentially a probing amendment to ascertain whether the Government will accede to the request of the professions and their regulatory bodies to build in the safeguards that we and they believe to be essential. Many of those safeguards are subject to the amendments which stand in the name of the noble Lord, Lord Walton of Detchant—I refer to Amendments Nos. 202 to 204—and to our own later amendments. The protections are sought by all those professions which are currently regulated and include such important matters as provisions relating to lay representation; consent and proper consultation over rule changes; the transfer of functions to other bodies; the removal of Privy Council jurisdiction and, last but certainly not least, the whole question of protection of common titles.
We understand the desires of all parties to have a flexible framework, but that must not be at the expense of allowing self-regulation to give way to government regulation. The Minister said at Second Reading:
"This power is not about dismantling self-regulation. We share the common aspiration to strengthen, not weaken, that self-regulation".—[Official Report, 9/2/99; col. 1121
I very much hope that the Minister can indicate a certain flexibility in this clause. We very much look forward to her response. I beg to move.
Baroness Hayman: I am grateful to the noble Lord, Lord Clement-Jones, for the way in which he moved the amendment and for making clear the fact that he is not totally wedded to a time frame of one year, but rather wanted to debate some of the more general issues. With the best will in the world, given the scale of the task in front of us and what needs to be done, allowing only one year for such an order-making power would be unrealistic. It is perhaps worth looking at why it would be unrealistic and considering the motivation for including an order-making power in the Bill in the first place. There were two reasons. First, there is an enormous backlog of desirable changes to be made to the legislation governing professional self-regulation. The replacement of legislation for the professions allied to medicine will require a substantial order of a similar size to the present Professions Supplementary to Medicine Act 1960. The professions have been pressing for that for some time, as the noble Lord and the Committee are aware.
We also want to replace the nurses, midwives and health visitors legislation and have recently published the review and the Government's response to it. Desirable changes for dentists, opticians and pharmacists are already well developed. There is also the challenge posed for us by professions which are not at present regulated by statute. The Government intend

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in time that the power can be used to introduce new regulatory schemes for such professional groups as psychologists or counsellors. A great number of professions linked to medicine are looking at ways of strengthening public protection through their systems of self-regulation.
There is a large quantum of work. What has also been clear from the debates in Committee is the desire that, in doing this work through secondary legislation, we should not curtail proper debate and discussion on these important issues. That means that we would not want to see anything rushed through without sufficient time to consult properly and fully with the professions concerned and with other interests. We shall come to specific amendments about them later. We want to work in partnership with the professions and thus ensure that we have enough time to develop the framework that is most appropriate for all the groups which might be affected or might wish to be considered. We must have time to ensure that the public is afforded the protection for which this clause is primarily designed.
Prior to the making of an order under Clause 47, we intend that there will be full consultation with the profession concerned and other interested groups; for example, patient groups, the Welsh and Northern Ireland Assemblies and the Scottish Parliament. We anticipate that the professional and regulatory bodies will wish to consult their members. Once an order has been drafted the draft must be published at least three months in advance of the draft order being laid before Parliament. Consultation on the draft order must be carried out. All this takes time.
Even if it were possible to clear just the current backlog of desirable proposals within the next few years, time-limiting the power would not be desirable. That is because this power is not designed as a quick fix to deal with problems built up over the past few years. The modernisation of the statutory regulatory bodies is an on-going process. Clause 47 and Schedule 3 provide a way of ensuring that the process of updating legislation can be more responsive to changing expectations of the professions and the public. For example, the GMC's proposals for revalidation, which, I believe, have been met with universal approval, will take at least two years to develop and implement. It may be some time before it is clear whether any changes to the law are necessary to underpin that.
I understand the motivation behind this amendment and assure the Committee that we have built in a system of appropriate checks and balances. I hope that we have taken into account the spirit of the comments of the Delegated Powers and Deregulation Committee which undertook, as the noble Lord pointed out, particular consideration of this issue. The committee recognised that the problem was,
"striking the right balance to protect the interests of all concerned bodies",
rather than saying that an order-making power was not the appropriate way to tackle this task. That committee recognised that we had already built in a number of important procedural safeguards. It also suggested that the House consider two further safeguards: a requirement for the Minister, when laying a draft order,
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also to lay before Parliament a summary of representations received, showing in particular whether the professional body affected by the draft order had, first, been consulted, and what was the result of that consultation; secondly had agreed the provisions in the order; and, thirdly, if not, the reasons for making the order without the consent of the professions concerned. Its second recommendation was that the Bill might be amended to include a statement of the criteria against which the Minister could act in the absence of agreement with the professional body or bodies concerned—that is to say,
"for the protection of the public and for the better development of the profession".
The Government accept these recommendations in principle and will look to bring forward appropriate amendments.
I hope that the Committee will agree that to impose a cut-off point after which the order-making power could not be used would therefore severely damage its usefulness in allowing the professions to develop and in allowing the Government to discharge their duty of protecting the public. It is, I believe, significant that the delegated powers committee did not advise the House that the power was drawn inappropriately wide, or that it should be time-limited. In accepting the committee's recommendations, I believe that we have now struck the right balance in terms of procedural safeguards and I hope that the noble Lord is reassured and will withdraw his amendment.
Lord Skelmersdale: Before the noble Lord withdraws his amendment, I am absolutely delighted that the Government have taken cognisance of what was said by the committee on delegated powers. I am sure that the Committee will agree with that. I also go along with 99 per cent. of what the noble Baroness has just said. However, I understood her to say that the Bill gives power to regulate a profession for the first time by statutory instrument. Can she tell me where in the Bill that is to be found? I find that very undesirable indeed. For example, acupuncturists are in the queue for regulation. It is perfectly acceptable to alter the primary regulation by statutory instrument, with the safeguards that the noble Baroness has just agreed; but I do not find it acceptable to regulate in the first instance by a piece of legislation which cannot be amended by Parliament. I would be very firm on having the first regulation by the Bill.
Baroness Hayman: I am grateful to the noble Lord. As I understand it, Clause 47(3)(b) envisages the possibility of regulation for the first time. That would be in two possible circumstances. It might well be that a profession joins a successor body of the CPSM. At the moment it is possible, by secondary legislation, for a new profession to be regulated for the first time. It has been done with the art therapists recently. There are now three applications to the Privy Council including one from clinical scientists. It would not be a new provision for a profession to be regulated for the first time by secondary legislation. The noble Lord is right for it to be made transparent that it is inherent within the powers of the Bill, as drafted.
3.45 p.m.
Baroness Carnegy of Lour: Can the Minister say how Clause 47 and the Scottish legislation interact? She has the noble Lord, Lord Macdonald, sitting beside her so he may be able to help. I hope that I am asking the question at the right moment. It is a little difficult for me to judge whether it would be more appropriate to do so in connection with another amendment. The British Medical Association is extremely anxious that the General Medical Council should remain a United Kingdom-wide body and that it should not have a separate entity for Scotland. This matter is causing great anxiety for that body.
The Scotland Act establishes that the regulation of the profession is included in Schedule 5 of that legislation. It states that it is a reserved matter to the United Kingdom Parliament. The regulation of the professions can only be changed by order agreed by both Houses of the Westminster Parliament. The BMA is anxious whether Clause 47 and Schedule 3, about which the noble Baroness has just been speaking, clash in any way with that provision or alter it. Can the noble Baroness say whether the GMC is secure in believing that its arrangements can only be altered by the Westminster Parliament? In other words, can the Scottish parliament separate the General Medical Council even if Westminster did not want to?
Baroness Hayman: Perhaps my noble friend will give further details on that when we deal with some of the Scottish issues. We have always made it clear that devolution will not undermine the principle of a UK-wide National Health Service and will ensure consistently high standards throughout the United Kingdom. The regulation of the health profession will remain, as now, a matter for the UK Parliament. It is not being devolved to either the Scottish Parliament or the National Assembly for Wales. As regards existing professions, there is no doubt and no uncertainty about that. It is a reserved matter.
I should perhaps flag-up to the House the fact that there is a complication as regards a new profession that might join those currently under the CPSM. Because the transfer of functions deals with the professions as regulated at the moment, in order to have UK-wide regulation for a new profession, not a medical profession such as those already regulated, there would have to he a specific decision by the Scottish Parliament so to do.
That is my understanding—I am sure I shall be corrected if I am wrong—about a new profession which is to be regulated for the first time, whose regulation is not already covered within the provisions of the Scotland Act. In relation to the basics of self-regulation for existing professionals, that is a reserved UK matter.
Baroness McFarlane of Llandaff: Perhaps I may return to the force of the order-making powers. Will the Minister give us an assurance that those bodies whose
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regulatory powers are established under an order will have the same protection of their regulatory function as those professions which appear on the face of the Bill?
Baroness Hayman: We shall deal with some of those issues at a later point. It is our intention, when we talk about replacement bodies for perhaps the CPSM, and nurses, midwives and health visitors and therefore the UKCC, that they should have the same protection.
Lord Clement-Jones: I thank the Minister for the generous spirit in which she accepted the recommendations of the deregulation committee. I take that as an appetising hors-d'oeuvre to our debate today, though we are looking perhaps for a three course meal in the course of this Committee stage. There are many other aspects to consider but that is an excellent start. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Morrisof Manchester moved Amendment No. 195:
Page 38, line 14, at end insert—
("(za)regulating and modifying the regulation of any profession to which subsection (IA) applies.").
The noble Lord said: In moving this amendment, I will also be speaking to the other amendments standing in my name.
I have an interest to declare as President of the Society of Chiropodists & Podiatrists: not a financial interest, but one founded on my admiration of the society's undeviating commitment to high professional standards and its genuine respect for the founding principles of the NHS.
My noble friend will recall that, at Second Reading, I raised with her the society's concerns that the Bill makes no specific mention of protection of title or of any definition of the future regulatory regime. Hence my amendments. Their purpose is to seek firm assurances on the two issues, either in the Minister's reply to this debate or subsequently by letter, so that the society can decide whether to return to these important issues at the Report stage. The society speaks representatively of state registered chiropodists in wholeheartedly supporting the Government's stated aim of strengthening self-regulation to protect the public. Its principal concern is whether this legislation will achieve that end for chiropody.
At present, chiropodists are regulated by the Chiropodists Board, under the Professions Supplementary to Medicine Act 1960. The board's chairman and the majority of its members are state registered chiropodists elected by their peers. This is what the society means by self-regulation; namely, that a majority of the regulatory body's members are of the same profession. Doctors, dentists, pharmacists, nurses, osteopaths and chiropractors have this form of self-regulation and, under the Bill's proposals, it appears they will continue to do so.
Yet for the professions supplementary to medicine, including chiropodists, the Government appear to be proposing to abolish the individual boards and to create

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a generic council, on which each profession would have only one or two representatives. The individual professional boards appear set to be replaced by merely advisory bodies and the Society of Chiropodists and Podiatrists is concerned that self-regulation, properly so-called, would then cease to exist. In the society's view this would not provide the protection for the public to which the Government are committed and on which Parliament should insist.
The aims of my amendments are twofold. First, they would have the effect of separating chiropody from the other professions supplementary to medicine and aligning it with doctors, dentists, pharmacists, nurses, osteopaths and chiropractors, with the advantage, as it appears, of retaining for the profession a self-regulating board with a majority of state registered chiropodists. And secondly, the amendments would ensure protection of title for "chiropodists" and "podiatrists".
The society believes that both self-regulation and protection of title are essential safeguards in protecting the public. At present, the Chiropodists Board has the power to decide fitness to practise; to determine educational standards and entry to the profession; and to adjudicate all professional disciplinary matters. For the profession of chiropody/podiatry to lose that power would not be in the public interest and I trust we shall now be assured that it will retain that power.
State registered chiropodists have the right to diagnose and treat patients independently of medical practitioners. They are able to carry out invasive bone surgery, such as bunion surgery, and to use local anaesthetics and other prescription-only medicines. They also provide special clinics for diabetes, a condition which afflicts about 3 per cent. of the adult population. As many of your Lordships will know, preventive health care of this kind can avoid serious conditions which may result in amputation of a leg. Indeed some research carried out in Manchester, of which I heard recently when performing the official opening of Manchester's new Foot Hospital, showed that amputations increased by 50 per cent. in the absence of timely intervention and appropriate treatment. What could more starkly emphasise the crucial need, in the public interest, for professionals with such responsibilities to be effectively regulated?
It is important also, if the public are to be properly protected from malpractice, that the professional titles "chiropodist" and "podiatrist" are protected. At present, an individual who is unqualified can establish a private chiropody/podiatry practice; and in fact a registrant who is struck off the register can continue to practise and to use the titles "chiropodist" and "podiatrist". European Union regulations require those who treat horses' hooves to be properly qualified. Speaking as a former member for six years of the Council of the Royal College of Veterinary Surgeons, representing the Privy Council, and now as an Honorary Associate of the British Veterinary Association, I rejoice that this is so. Surely the same regulations should, however, apply to those who care for human feet!
Some people in Whitehall seem to think that, because there is no evidence of negligence cases against non-state registered practitioners, the public is not at
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risk. But the reason for this is that there is no statutory regulation of the private sector and thus claims made against non-state registered practitioners are not in the public domain.
In this regard I have received a letter from Mrs. Sue Sharpe, the Director of Professional Standards of the Royal Pharmaceutical Society of Great Britain, who is held in high regard on both sides of your Lordships' House. She writes in support of my amendments on the grounds that there can be considerable danger to patients in using non-state registered chiropodists. She tells me of a notice circulated to members of the Royal Pharmaceutical Society, advising them only to promote the services of state registered chiropodists. This provoked an outraged response from a non-state registered chiropodist who said that the Council for the Professions Supplementary to Medicine had no control over the private sector and no business to interfere. What some in the private sector clearly want is carte blanche: more and more deregulation which, in terms of the public interest, makes about as much sense as deregulating Big Ben.
Referring to the vital importance to diabetics of timely and appropriate treatment, Mrs. Sharpe states:
"This outraged reaction to our advice makes the case for your amendments when you consider the possible consequence of services for diabetics being provided by individuals who may have no insurance and no qualifications".
She goes on to say that effective regulation of the health professions is an important matter of public concern and, if the Government were to propose a fundamental change by transferring to others any of the core duties of regulating the principal professions from those presently charged by statute with these duties, then it should be a matter for primary legislation. With the order-making power conferred by the Bill in place, she argues, primary legislation need not be lengthy and detailed: a short Bill would suffice.
Mrs. Sharpe concludes:
"We are all at some stage dependent on the quality of services provided by the health professions and to ensure that those who regulate them properly represent our interests. That is why a change of such magnitude as transferring core functions to another body should be reserved to statute".
That is eloquent testimony to the need for the firm assurance I am seeking that there will be a minimum common legal qualification for a chiropodist/podiatrist and that the use of titles will be limited accordingly. The non-state registered sector could be integrated into regulation through a process of "grandfathering" and they would, I understand, support this move.
I welcome the Government's decision to deal with the need to reform legislation which was enacted nearly 40 years ago and is now thoroughly out of date. Some of your Lordships may recall that I introduced a Private Member's Bill in 1994 to provide effective regulation for chiropodists. My promotion of that Bill explains why I am anxious now to achieve total clarity about what is being proposed in terms both of protection of title and the future regulatory regime.
State registered chiropodists are not seeking aggrandisement for their profession. On the contrary their aim, for which I know your Lordships' House will

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honour them, is to protect professional standards and the public interest. I know my noble friend will want to reply to the amendments both positively and helpfully. I beg to move.
4 p.m.
Lord Astor of Hever: I rise to support Amendment No. 200. The Government's proposals for the future regulation of chiropodists and podiatrists and the other professions supplementary to medicine are not clear on the face of the Bill. What is clear is that the present Chiropodists' Board, set up under the Professions Supplementary to Medicines Act 1960, would be abolished. It appears that it would be replaced by a generic council of 42 members with a maximum of only two chiropodists as members. This would mean the end of self-regulation for the profession.
I support the aims of the amendment of the noble Lord, Lord Morris of Manchester. I also believe that the chiropody profession should be grouped with doctors, dentists, pharmacists, nurses, osteopaths and chiropractors, who appear to be set to continue with self-regulating boards consisting of a majority of members from their own profession.
I also believe that protection of title for chiropodists and podiatrists is vital to ensure that patients are properly protected from unqualified practitioners. I want to be certain, as I am sure do all noble Lords, that those who treat our feet, including carrying out surgery, are properly qualified to do so.
Lord Clement-Jones: I very much support the amendment moved by the noble Lord, Lord Morris of Manchester, and my noble friend Lady Sharp of Guildford. The Chiropodists' Board under the existing CPSM is currently the effective regulatory body for chiropodists and podiatrists. It appears, however, that the Government are acting on the recommendations of the 1996 J M Consulting report which recommended the creation of a new umbrella council with stronger powers, but the abolition of those individual boards of the professions described in the Act as supplementary to medicine, though I know the professions would prefer to be known as the professions allied to medicine.
Looking at the original J. M. Consulting report, I believe that it was rather dismissive of the need for those individual separate boards. Most of the professions allied to medicine appear, however, to be able to live with that new regime. The chiropodists and podiatrists are not, and they do not see why they should have to be subsumed against their wishes, in a wider council when professions such as osteopaths and chiropractors do not. What makes their position so very different?
As the noble Lord, Lord Morris, and the noble Viscount, Lord Astor, have explained, chiropodists and podiatrists are unique. They have the right to do certain things that no other profession allied to medicine does.
We also support the protection of the titles of chiropodist and podiatrist, but we believe that there are issues here relating to a great many other professions
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allied to medicine. I shall keep my remarks on that particular matter to a later amendment. I urge the Committee to support these amendments.
Lord Milverton: I rise to support the amendments of the noble Lord, Lord Morris. They are sound in principle in every way. I hope that the Government will be able to accept them.
Baroness Fookes: There was in my former constituency a school of podiatry and I had an opportunity to talk to the head of that school on many occasions. I was frankly amazed at the type of work that was undertaken by podiatrists, which went far beyond my superficial view that it was a matter of cutting toe-nails or hard skin from the feet of ladies who wore high heels. It is an extremely important profession and it deserves to be treated as a profession in its own right.
I am particularly concerned that there should be the ability to protect the title of chiropodist or podiatrist. I still have difficulties with "podiatrist", but I know that the profession itself prefers the term. Whichever title is used, it is very important that it should be protected. The work they do relating to foot problems is far too important to allow unqualified or insufficiently qualified people to tackle it.
Lord Colwyn: At an earlier stage my noble friend Lady Gardner explained the difference between dentists and dental surgeons. I wonder if the noble Lord, Lord Morris, could explain to me the difference between these two categories of people who look after feet.
Lord Morris of Manchester: Some people use the terms interchangeably. The society changed its name in order to make it clear that. whether people speak of "chiropodist" or "podiatrist" they are talking about fully qualified members of the same wider profession which the two titles describe.
To some extent any confusion is caused by people in the private sector who give the impression that there is something far more prestigious in describing themselves as one rather than the other. I hope the noble Lord will have no further difficulties.
The society, by changing its title, simply wanted to remove any doubt that whether the term "chiropodist" or "podiatrist" is used it both represents and speaks for them.
Lord Walton of Detchant: With respect to what the noble Lord, Lord Morris, has just said, is it not the case that training in chiropody is a primary qualification which allows a registered chiropodist to undertake relatively minor procedures but that those trained in podiatry undertake an extended period of training, often in collaboration with surgeons and medical practitioners, which enables them to carry out more extensive minor surgery on the feet under local anaesthesia?
Lord Morris of Manchester: Of course, I have great respect for my good and noble friend Lord Walton. It

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arises from our work together in the service of the Muscular Dystrophy Group of Great Britain. All of us respect his view.
As I explained to the noble Lord, Lord Colwyn, the society wanted to make it absolutely clear that it comprises fully qualified members of the same wider profession which the two titles describe. I am sure everyone here is totally appalled at the prospect that an unqualified and uninsured practitioner could, in some circumstances, advise a diabetic. That must be a very serious matter. Quite clearly, it is not in the public interest.
Baroness Hayman: I am grateful to my noble friend for allowing the Committee to debate these issues and to recognise the important role in healthcare played by both chiropodists and podiatrists. Like the noble Baroness, Lady Fookes, I had some relationship with a school of podiatry. I, too, recognise how wide and highly skilled the role of qualified podiatrists is today and the areas of healthcare in which they make such an important contribution. However, I have to tell Members of the Committee that that is also true of some of the other professions allied to medicine who also take enormous responsibilities for patient care. That is part, perhaps, of the rejuggling of boundaries between professionals that has taken place as training has developed over the years.
On the issue regarding the protection of title for chiropodists and podiatrists to which we have returned several times, perhaps I should point out that that is equally strongly felt by physiotherapists, who also have the choice of title of physical therapist, which is the international title, and by other groups of professions allied to medicine. Indeed, one of the main reasons for the review of the Professions Supplementary to Medicine Act was the very strong recommendation that it does not give adequate protection of title for the professions supplementary to medicine; it is inadequate in that respect. We need new legislation which will give patients better protection. That is probably one of the strongest reasons for the review.
Some confusion has arisen as regards the different stages of the process in terms of debating the specific issues relating to chiropodists and how they might be treated under secondary legislation which may be brought forward after the order-making power in the Bill is enacted. We shall deal later with the protection of core functions to which my noble friend alluded. We have made it very clear that we want to protect those core functions of professional regulatory bodies.
What we are doing today in this Bill represents the first stage in quite a long process, as I suggested earlier. The order-making power will provide the mechanism by which changes can be made to legislation governing professional self-regulation, including that covering the professions supplementary to medicine. However, it does not deal in detail with the proposals regarding what those changes should be. I can quite understand that chiropodists will want to know how they will be affected by the changes that we wish to make to the Professions Supplementary to Medicine Act. That is why we have made it quite clear that we are committed
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to consulting the individual professions concerned in developing any proposals to replace the CPSM, as well as consulting them on the draft order itself.
I was pleased to have the opportunity to meet members of the Society of Chiropodists and Podiatrists last week in order to discuss the issues of importance to them. I look forward to further discussions with the society on the detailed proposals that come forward in due course. However, I am certain that the other professions supplementary to medicine equally have individual issues with which they are concerned, so I am not sure that it is appropriate to have that debate at this stage of the Bill's proceedings. The examples given during our short debate today are perhaps not totally apposite. Both the osteopaths and the chiropractors have their own boards because they have their own legislation. One of their reasons for pursuing individual legislation was that when they were looking for self-regulation they did not think that the PSM Act gave them sufficient protection. However, it is not that we are treating chiropodists differently from them; indeed, we are certainly not suggesting treating them differently from all the range of professions governed by the Act at present. These include dieticians, occupational therapists, physiotherapists, medical laboratory scientific officers, radiographers, and others. There is certainly no suggestion that we will be treating chiropodists less well than them. Nor, I have to say, are nurses totally separately regulated under the Nurses, Midwives and Health Visitors Act. The UKCC is a joint regulatory body for nurses, midwives and health visitors. Some of these issues about how individual professions within joint working are properly protected are common in that respect.
I understand the chiropodists' concerns about retaining professional independence. We recognise that they wish, correctly, to retain a distinctive voice in the regulation of their own profession. There is widespread agreement within that context that there are important benefits for patients and for the professions to be gained from reforming the PSM Act to create a better, multi-professional legislative framework, based on collaboration and common aims and values. That was one of the fundamental recommendations of the review of the Act. The review recommended a new and stronger council which would be able to influence and co-ordinate the regulation of individual professions.
A modernised and multi-professional structure for the professions supplementary to medicine will build on the traditions of many years of partnership working under the existing legislation. Benefits are obtained from common values and approaches and the formulation of cross-professional policies. A reformed body will provide a stronger voice for these professions—the chiropodists, podiatrists, dieticians, occupational therapists, orthoptists, physiotherapists, prosthetists and orthetists, arts therapists, medical laboratory scientific officers and radiographers. Some of those groups are very small professions for which, I suggest, separate and individual regulatory bodies would not be a sensible way forward. I have made it clear that

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it is our intention to repeal the PSM Act and replace it with new legislation to regulate these professions. That will be a priority for the use of the order-making power.
As I said, the details of the replacement framework are a matter for the future. However, I understand the concerns of chiropodists that the distinctive contribution of each profession, within a joint regulatory framework, should be properly acknowledged. The successor body to the CPSM will need to be sufficiently flexible to ensure that uni-professional input is preserved where appropriate. It will be one of our key aims in working with the professions to develop the proposals to ensure that future arrangements strike the right balance in that respect. I can assure my noble friend and others who have spoken that we will take into account the views that have been expressed in developing proposals upon which we shall be consulting. I believe it is possible to ensure that there are safeguards for the distinctive voices of all the individual professions. In some areas, such as fitness to practise it is absolutely appropriate that they should be in the majority when considering cases which come before them. I believe that within the new structure we can find an appropriate balance.
On the question of protection of title, I am in total agreement with my noble friend that the protection afforded at present is completely insufficient. As he said, the title currently protected is "state registered chiropodist". We can ensure within the health service that only state registered chiropodists are employed. However, we do that by direction. That is not the same as the powers that will be available for the professions themselves after new legislation is introduced for the professions supplementary to medicine. At the moment any individual can set up in practice and call himself a chiropodist. My noble friend is quite right to point out that that has dangers for the public. It is something we are anxious to change. I reassure him that the order-making power in the Bill will enable us to do that. Paragraph 1(d) of Schedule 3 to the Bill, referring to the,
"privileges of members admitted to practice",
is the relevant provision. It is rather sad that we did not make it clearer in the Explanatory Notes that this measure concerns protection of title, as I know that is an important issue for all the professions. The draftsmen assure me that this is the right way to deal with the matter. However, we could have pointed out in the Explanatory Notes that,
"privileges of members admitted to practice",
covers this important issue as it is fundamental to the protection of patients and it is one of the key reasons for going ahead with the plans that we have.
I suggest that a separate professional regulatory body for chiropodists alone is not a sensible way forward given the history of multi-professional co-operation within the ambit of the professions supplementary to medicine. I hope that when we bring forward proposals we can do so in a way that reassures chiropodists and podiatrists—and indeed the other professional groups within the ambit of these provisions—that they will have appropriate input into the areas which are of concern to
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them. I hope that in the light of those assurances my noble friend will not feel the need to press these amendments further.
Lord Clement-Jones: Without wishing to pre-empt the reply of the noble Lord, Lord Morris of Manchester, I hope that I may express a view to the Minister. I believe there will be considerable disappointment at her comments, but on the other hand strands of what she said may well be helpful. The Minister talked about the issue of safeguards and fitness to practise being kept firmly within a profession's ambit. Can she say a little more about the advisory boards as they are a considerable bone of contention, as she knows? In the J. M. Consulting report they were regarded as an optional extra. However, many professions, not just chiropodists and podiatrists, would regard them as being an important part of the new framework. Will the Minister elucidate further on that?
Baroness Hayman: I am not sure that I can because we do not have proposals to put forward at this time for an order to replace the current legislation. It has been said often during the course of our debates that we should listen to the professions on these issues. If I were to pre-empt that discussion by saying now what the rules of the advisory committees will be, I suggest that that would not be in the spirit of the consultation we are trying to take forward. We must ensure that the overall board—which is multi-professional, and can gain strength from that—recognises that there are some issues where the distinctive voice of an individual profession must be heard. We shall try to take that into account when framing proposals. However, I cannot tell the noble Lord what the proposals are because we have not framed them.
Lord Skelmersdale: In that case why does the Bill get rid of the 1960 Act at this moment? Why not make provisions by order so that we all know what is going on?
Baroness Hayman: One of the safeguards is that we cannot abolish a regulatory body except by primary legislation. That is one of the safeguards written into the Bill. We are in something of a Catch-22 situation here. If we did not take the relevant powers in this piece of primary legislation, we would leave professions supplementary to medicine in exactly the same difficulty as they are in now of having to queue up for primary legislation before any change can be made to them. Because the defects of the system are so well established the Government know that they want to repeal that piece of legislation. A review was published in 1996 along with the then government's response to it. Therefore we thought it appropriate to state on the face of the Bill that we intended to do that so that everyone was aware that that was the way we were going forward. However, that shall not be effective until replacement legislation—in this case, secondary legislation—has been brought forward. Therefore we ensure that we do not set the

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position in tablets of stone for those who are furthest advanced in needing change, and not allow them the benefit of the order-making power.
Lord Clement-Jones: I hope I may probe a little further. I fully understand that consultations are taking place. However, I had understood that consultations were taking place on the basis of the Government's view of the J. M. Consulting report of 1996. I had assumed that the Government had said they liked its broad outlines. Surely the consultations concern precisely that framework. My questions to the Minister were set in the context of that framework. I asked whether or not there was the possibility of the Government moving further in the light of representations which have been made on the Bill, and those made before the Bill was published.
Baroness Hayman: The previous government responded to the J. M. Consulting report. What I have tried to say this afternoon is that in framing any proposals that this Government bring forward for the content of a new order to replace the Act, I personally shall ensure that the comments of the Committee this afternoon and the issues that it has highlighted, particularly concerning individual professions, will be taken on board. However, this is a sequential issue. First, there is the repeal of the Act, and there is the order-making power. Then there will be proposals to be consulted on with the regulatory body, the individual professions and with the wider public. Then we have to have a draft order that is consulted on. We are not at the stage of having definitive proposals to put before the Committee.
Lord Morris of Manchester: As I indicated in moving the amendment my purpose today was to secure total clarity as to the Government's intentions in regard both to protection of title and definition of the future regulatory regime they envisage. Certainly what my noble friend has said about protection of title will be welcomed. I also sought firm assurances that would satisfy the Society of Chiropodists and Podiatrists that any change to current arrangements for self-regulation would be to strengthen rather than to weaken them. I shall be consulting the society urgently about the outcome of today's debate so that it can consider what further action it may wish to take in the interests both of its members and the public interest. It is on that basis that I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 196 and 197 not moved.]
4.30 p.m.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 198:
Page 38, line 28, at end insert ("including specifically nursing auxiliaries as defined in subsection (6)").
The noble Lord said: This is a probing amendment. The amendment seeks to include within those professions related to health and medicine healthcare assistants and nursing auxiliaries. The amendment is a response to the fact that much of healthcare at ward level is in the hands of healthcare assistants or nursing
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auxiliaries. At present the profession is completely unregulated. Although it is very difficult to make comparisons between now and 10 years ago, it seems from the figures that in some regions there has been some growth in the use of nursing auxiliaries. There have been abuses and problems as a result of that profession being unregulated.
A recent J. M. Consulting report on the regulation of nurses, midwives and health visitors took a good deal of evidence on the issue of nursing and midwife discipline and also responded to the concerns being expressed about the lack of regulation of healthcare assistants. The report states:
"Those who responded to our consultation have expressed a deep concern about the threat to public protection posed by some unregulated support workers who, for example: obtain posts by deception or without adequate check on their suitability; or work unsupervised with vulnerable patient groups; or work in high-risk situations with no training".
It continues:
"We recommend that the government establishes a short review of this area with the aim of introducing a practical scheme of regulation".
In a recent Starred Question the Minister assured me that the matter was under review but the second half was, in a sense, missing. There was no undertaking that at the end of the process the idea was to introduce a practical scheme of regulation. It would be very helpful if the Minister could indicate her intentions at this stage.
The RCN has called over a number of years for the regulation of healthcare assistants and certainly did so in its response to that review of nurse and midwife discipline. A recent survey of nurses showed 94 per cent. of respondents calling for regulation. The most notorious case involving healthcare assistants was that of Yuen How Choy, which was reported in 1996. In that case a former mental health nurse and former rapist was struck off the nursing register but could still be employed as a care assistant in a hospital. That may be a hard case but it seems to demonstrate precisely why regulation is needed in these circumstances. I beg to move.
Earl Howe: I rise to support the noble Lord, Lord Clement-Jones, in his amendment. The points he has made are very persuasive and ones with which I completely agree. He is right to draw attention to the issue, which is of considerable importance. If I have a small criticism it is of the wording of the amendment. I would have preferred to see specified "healthcare assistants" and not "nursing auxiliaries", but the substantive point is exactly the same.
As the noble Lord said, healthcare assistants or nursing auxiliaries play an increasingly important role in the delivery of patient care, both in hospitals and in the wider community. The registration of healthcare assistants would achieve two main purposes. It would offer a means of sifting out bad apples who presently move from one part of the country to another and repeat their misdemeanours undetected and often with impunity. It would also lift the standing of the profession by providing a means of self-advancement through a recognised system of professional

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qualifications. In addition, the Royal College of Nursing has referred to the desirability of matching the regulatory framework with the lines of accountability that operate in practice. Healthcare assistants are very often supervised by nurses and there is a good argument for shared and complementary codes of conduct and disciplinary systems.
There is an urgent need to address this matter quickly. I wonder how many members of the public are aware that healthcare assistants, in hospitals or the uniformed carers in an old people's home, are subject to no statutory regulation or minimum standard of proficiency. The increasing dependence of hospitals on their auxiliary staff and public concern over cases of abuse in homes make it all the more essential that we provide a means of raising standards of care across the board. It is part of the quality agenda and I hope that the Minister will be sympathetic, if not to the amendment then to the central point at issue.
Baroness McFarlane of Llandaff: I support the two amendments in this group, if only in intent because there is a question of terminology in terms of "healthcare assistants" being substituted for "nursing auxiliaries". Without wanting to enter into a sociological discussion of what is a profession, it could be questioned whether nursing auxiliaries are part of a profession.
The principle of these amendments is exceedingly important. Not only are healthcare assistants employed in hospitals where they are theoretically supervised by nurses, although often by default they are not, but they are also employed to give intimate care in patients' own homes without any direct supervision. These are important amendments.
Baroness Hayman: I hope that I will be able to respond, as the noble Baroness, Lady McFarlane, has suggested, to the important substance behind the amendments. My understanding is that as currently drafted the order-making powers are quite wide enough to encompass any action needed to regulate these groups. Therefore, this specific amendment is not necessary to the Bill should that decision be taken. I respect the opportunity that has been taken to raise the issue of the role of nursing auxiliaries or healthcare assistants, however we use the terminology. I was particularly grateful for the way in which the noble Earl, Lord Howe, pointed out that this issue is concerned with lifting standards and respect for the profession as a whole as well as dealing with the particular problem of abuse, which occurs only in a minority of cases.
Nursing auxiliaries and healthcare assistants in the NHS play a very important role, which may not feature prominently in some of the coverage of the health service. They perform a significant number of tasks that in the past would have been considered specifically nursing tasks. They are intimately involved with patients and those who they care for, and the public are entitled to an assurance that only suitably trained and appropriate individuals are employed in positions where there is such contact with patients.
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I recognise the concerns that have been expressed about the development of the roles undertaken by nursing auxiliaries. These concerns have been raised in the past in the context of the need for regulation of support workers. As the noble Lord, Lord Clement-Jones, said, this issue was discussed in the review of the Nurses, Midwives and Health Visitors Act and the conclusion was reached that full-blown self-regulation was probably not the answer. The review recommended a short review of the position regarding support workers. It was recommended that the review should advise on codes of conduct for these workers, standards of training for those groups for which it is appropriate, the establishment of a list of suitably qualified support workers and the enforcement of those recommendations. We have announced our acceptance of that recommendation for such a review and we will go ahead with it.
I think the noble Lord, Lord Clement-Jones, is again tempting me to pre-empt the results of the review by saying what its conclusions would be. I think we should approach matters in a straightforward way and undertake the review.
We have already announced our plans to regulate social care staff in the social services White Paper, Modernising Social Services, by setting up a statutory general social care council. The driving force behind the new council is to increase the protection of service users, their carers and the general public. Any review of support workers within the health service will have regard to the decisions that the Government have already taken in relation to care assistants in the social care field. There is a great blurring of the edges in terms of where people receive treatment. It is important that we make sure that there is proper regulation across the board.
On that basis, and with the reassurance that the powers included in paragraph 11(2)(b) of Schedule 3 would be wide enough to enable legislation to take place on the regulation of these groups should that be considered appropriate, I hope that the noble Lord will consider that the amendment is unnecessary and will feel able to withdraw it.
Lord Clement-Jones: I thank the Minister for that helpful reply. Before responding, perhaps I may put one further question to her. So far as professional or occupational regulation is concerned, there are many other considerations. Clearly, much is happening at the department. What is the timescale for the review that is currently taking place? Will it be completed in a short space of time? The Minister said that it could take two years to settle the current rules of the GMC. This matter is rather more urgent.
Baroness Hayman: I do not have my Civil Service lexicon to tell me whether I should say, "shortly", "soon", or "before too long", and how those expressions translate into weeks or months. Perhaps I may write to the noble Lord and give him details of the timescale currently envisaged.
Lord Clement-Jones: I always think that "presently" is a useful expression. I thank the Minister for that reply.

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I certainly did not mean to under-value the role of healthcare assistants. Indeed, I was one for a short period of time. I believe that they were then called orderlies. I am not sure what happened to that title. They perform valuable services. One of the roles of regulation is to enhance professional self-esteem, training and all the other good things about healthcare. One tends to believe that regulation performs as a yardstick for the worst cases. Again, I thank the Minister and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 199:
Page 38, line 28, at end insert—
("( ) Orders under this section shall make provision for the regulation of the use of specific professional titles in relation to professions to which subsection (3)(a) above refers.").
The noble Lord said: We have had an interesting debate about protection of title. However, I wish to "ratchet up" the specificity of the Minister's reply.
Paragraph(1)(d) of Schedule 3 has been drawn to our attention. It relates to the privileges of members admitted to practice. It allows an order to be made which covers protection of title. But what protection of title are we talking about? Are we talking about protection of title as regards "registered nurse" or "registered physiotherapist"; or are we talking about protection of common title? Or are we talking about protecting the title "nurse", or "physiotherapist", so that the magic word "registered" does not have to be used in front of the title? This is important to a number of the professions. Perhaps the Minister will comment. We have heard of the Government's welcome intention to include in the orders the question of protection of title. That is very much the "quo" for the "quid" that the Government are proposing in terms of changing the regulatory structure. I beg to move.
4.45 p.m.
Lord Peston: It is difficult to know when to intervene in today's debates. I should declare an interest as an honorary member of the Royal Pharmaceutical Society—the word "honorary" being as it were, in italics, in the sense that no net benefits seem to flow from it in any form. I was not certain whether to intervene now or later in connection with the amendments tabled by the noble Lord, Lord Walton, which are inter-related.
The essential point is that protection of title is a restraint on trade. There is no avoiding that. Therefore, whether we are discussing nurses, doctors or anyone else, in the public interest it must be demonstrated that net benefits flow. Many of those supposed net benefits are set out in the amendments proposed by the noble Lord, Lord Walton, to which I shall speak.
I am convinced that there ought to be protection of title. In practice, the professions generate net benefits to our society despite the restraint on trade. However, as the noble Lord, Lord Clement-Jones, said (I do not know whether it is a "quid" for the "pro" or a "pro" for the "quid") there has to be a pay-off to society. That
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pay-off is concerned with the way in which the professions conduct themselves. I shall address that point in relation to the later amendments.
I hope that my noble friend the Minister will respond positively. I hope that she does not sell the pass and abandon the Government's responsibility for seeing in the final analysis that the public interest is protected. I stand second to no one in my support for the professions. But one of my main concerns is that they do not seem fully to recognise that there is a public interest here. The public cannot simply say, "Oh, yes, we trust you professionals from now to infinity and we do not need a reserve power." Whether my noble friend wishes to discuss the reserve power question now, which relates to the core function question, or whether she wishes to save it for her reply to the noble Lord, Lord Walton, is entirely a matter for her. I support the noble Lord, Lord Clement-Jones, in the desirability of protecting title. It tells consumers what they receive for the title in a properly regulated profession. That is fundamental. However, I hope that in being to some extent supportive of the noble Lord, Lord Clement-Jones, we can also then talk more generally of what we expect from the professions and where the Government stand in representing the public interest. My remarks are a start; I shall not give up on the point when it comes to the later amendments.
Earl Howe: I wish to add my support for the amendment. The noble Lord, Lord Peston, is right to make the point about the need to show net benefits if there is to be protection of title. Presently, there is scope for considerable confusion in the minds of the general public, hence a risk to patients arising from the use of certain professional titles by unqualified individuals. That usage is perfectly legal. "Registered nurse" is a protected title. "Nurse" is not; "psychologist" is not; nor is "podiatrist". And "physiotherapist" is not protected. The Charted Society of Physiotherapy has pointed out to me that the common international title for the discipline, "physical therapist", is likewise unprotected. That represents a loophole in the law. Unless the ability exists to regulate the use of specific titles, vulnerable people will continue to be misled into thinking that they are being looked after by qualified professionals. I hope that the Minister will be receptive to the point.
Baroness McFarlane of Llandaff: I, too, support the amendment. There is considerable confusion in the mind of the public, particularly about the title "nurse". Very often healthcare assistants have the title "nurse" on their name badges. I have met members of the general public who are very confused about who is nursing them. They describe to me people in a chequer uniform and ask: "Are they registered nurses, or not?". For the general public it is very confusing.
Baroness Hayman: I am tempted to tell the noble Baroness of the male doctor who recently raised with me the issue of confusion in patients' minds. He said, "It was all so much easier in the past when all the men were doctors and all the women were nurses." Perhaps that is a road down which I should not be tempted.

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I agree with the importance that has been placed on the issue of the protection of the public which, after all, is the reason behind all that we are discussing with regard to self-regulation. Perhaps I may reassure my noble friend Lord Peston by saying that the reason why the Government wish to support and strengthen self-regulation is that we believe it is the most effective way of enhancing public protection, and not simply as an end in itself, if I can put it that way.
I can certainly understand the frustration, particularly of the professions supplementary to medicine, as the Act of 1960 does not protect specific professional titles or provide protection of function, which is another way of ensuring the protection that the public would wish. It is three years since a review of the Act recommended that that problem be addressed. That is one of the reasons for the impatience in getting on with this Bill and the order-making power.
We believe that the protection of common title or function is fundamental to the protection of patients. I wish to reassure the Committee that the Government fully intend to ensure that appropriate provision is made in the replacement legislation in this regard for each of the professions concerned. As has been pointed out, individual professions have particular interest in it and particular interest in what is the appropriate term, whether it is both "chiropodist" and "podiatrist", both "physiotherapist" and "physical therapist". Once you start protecting three or four different titles for the same professional group, there is a danger that public clarity and understanding will not be enhanced. We must approach this on a sensible basis. We shall consult the professions on the proposals in due course.
Again, I want to stress the way in which the order-making power in Clause 47 and the words,
"privileges of members admitted to practice",
in paragraph 1(d) of Schedule 3 are phrased. We believe that we have the legislative powers to do that.
On the issue of exactly which title is to be protected, I say to the noble Lord, Lord Clement-Jones, that we would certainly be looking to protect the common title for the professions allied to medicine. With regard to nurses, there has always been a difficulty in the past with the term "nurse", as the noble Baroness, Lady McFarlane, will be aware. If you protect the common title of "nurse", how does one deal with nursery nurses and veterinary nurses? I am not sure that we have found a perfect answer to that one. The issue is most important in the areas of the professions allied to medicine and there the common title will be the one that we shall be seeking to protect.
Lord Clement-Jones: I thank the Minister for that reply. In response to the noble Lord, Lord Peston, as a member of one of the most over-protected professions—I am a solicitor—I am conscious of the need to be aware that if there is protection it must be in the public interest. I believe in the case that we have made today. I am pleased by the Minister's reply, particularly as it applies
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to the professions allied to medicine. Her answer was quite specific about common title and not just requiring registration in every case.
I hope that the protection of the title "nurse" can be looked at further, perhaps in the context of the healthcare assistant agenda. It seems to me that the ideal time to regulate on the title "nurse" is when the occupation of healthcare assistant is regulated. That might be a useful break-point when the use of the word "nurse" could be clearly defined as someone belonging to the nursing profession. As a staging post, I welcome the Minister's comments and beg leave to withdraw the amendment.
Amendment, by leave, withdraw.
[Amendments Nos. 200 and 201 not moved.] Clause 47 agreed to.
5 p.m.
Schedule 3 [Regulation of health care and associated professions]:
Lord Walton of Detchant Lord Walton of Detchant moved Amendment No. 202:
Page 51, line 9, after ("may") insert (", subject to paragraphs 7 to 8A,").
The noble Lord said: In speaking to Amendment No. 202, tabled in my name and the names of my noble friend Lord Kilpatrick of Kincraig, the noble Baroness, Lady McFarlane of Llandaff, and the noble Baroness, Lady Emerton, I also wish to speak to Amendments Nos. 203, 204, 206 to 211, 213, 215, 216 and 217 as they are all closely interlinked. I shall try to explain that interlinking in a moment.
In speaking to these matters I am not just concerned with the interests of the General Medical Council but with the interests of all the eight self-regulatory bodies listed in the Bill, including the General Dental Council, the General Optical Council and others. Each of them is concerned about the present provisions of the Bill. If one were to apply the principle of reductio ad absurdam, it would be possible under the Bill, as drafted, to replace the present self-regulatory body by a small, government-appointed professional body. It would be possible to replace the GMC by a professional body of, say, four chief medical officers with no lay members. That is clearly a ridiculous idea which no one would contemplate. Everyone will be greatly reassured by the comments of the Minister earlier today.
We are concerned that the self-regulatory bodies have striven over the years to move towards the greater protection of the public, an issue to which the noble Lord, Lord Peston, referred. The noble and learned Lord, Lord Hailsham, has described professional self-regulation as one of the glories of a civilised society which nevertheless must take full account of lay opinion and lay concerns.
I became a member of the General Medical Council in 1971 and subsequently its president from 1982 to 1989. During that time the GMC moved rapidly towards bringing about a number of changes in its powers within the legislation, as it then allowed, in the greater interest and protection of the public. However, under the

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subsequent distinguished presidency of my successor, my noble friend Lord Kilpatrick, the number of lay members on the GMC concerned with the interests of the public was increased from II to 25, almost a quarter of the present membership of the council.
Even in my day, we began to recognise the crucial importance of the fact that the council had no powers over the issue of professional performance. It could deal effectively with doctors who were guilty of serious professional misconduct; it could deal effectively with doctors who were sick; but it had no powers to deal with doctors whose performance fell below a satisfactory level. In those days we began to look towards government to see if legislation could be introduced to deal with that particular issue. It took several years— I know that my noble friend Lord Kilpatrick will say more about this—before primary legislation under the Medical (Professional Performance) Act 1995 was introduced.
As the Committee will be aware and as the noble Baroness mentioned, quite recently the whole question of revalidation of professional performance of doctors in all disciplines, in all specialties and in all grades of work came under the ambit of the GMC. That will be a regular procedure together with the important point of the protection of the public, not least because of some concerns arising from recent notable cases that received a great deal of attention in the media.
The primary purpose of these amendments is to ensure that the order-making power under the Bill to modify regulation of the health professions is properly limited. As I say, the present regulatory bodies are all anxious to continue to develop effectively their ability to protect patients and to serve the public as well as they can within their power. Several of them had been waiting for amendments to the legislation concerning their powers for many years. To take but one example, the disciplinary legislation applying to pharmacists has been unchanged since 1954. The regulatory bodies and the professions recognise the substantial and arduous responsibilities conferred upon them. For many members of the public the quality of health services and of professional practice is among the most important of all issues affecting them. It is therefore of great importance that any proposal to change the responsibilities of bodies responsible for regulatory functions should be subject to the detailed scrutiny and debate of primary legislation. Fundamental change should not be implemented by secondary legislation.
The amendments which we have tabled ensure that the core functions of the present regulatory bodies may not he given to another body by an order made under Clause 47 of the Bill. Primary legislation would continue to be required, although such legislation could be very simple. Detailed provisions could be dealt with by order. We believe that this strikes the right balance between the use of primary legislation and secondary legislation.
In addition these amendments carry the intention that they will apply after the Nurses, Midwives and Health Visitors Act 1997 is repealed, as I understand is the Government's intention through the medium of the Bill.
The second main purpose of these amendments is to protect the role of the Privy Council. The Privy Council has a role in respect of all the professions, with the exception of the UKCC. That council's breadth of experience is valued by the professions as it provides a point for advice and informal consultation. As devolution progresses, a further benefit will become evident. The Privy Council will be able to ensure that proper weight is given to the views of the Scottish, Northern Irish and Welsh assemblies.
The Privy Council is to some extent removed from the political fray in which departments of state are inevitably immersed, and the professions attach great importance to that. They hold the Privy Council and its contribution to their work in high regard and want to ensure that existing links continue. If the links are to be broken, it must be by primary legislation.
The final purpose achieved by this group of amendments relates specifically to the professions regulated by the Professions Supplementary to Medicine Act 1960, about which we have already heard much this afternoon. At present there are nine such professions. They include the physiotherapists, occupational therapists, chiropodists and podiatrists, but there are many others, including psychologists, clinical scientists and speech and language therapists, who are seeking regulation in order to achieve protection of title—a point to which I shall return briefly—but above all to ensure that those practising in those professions are registered and properly qualified.
The amendments make appropriate provisions to ensure that when a successor body to the CPSM is established the regulatory functions are reserved to that successor body. They also ensure that where the use of certain titles is protected those titles will continue to have at least the same level of protection and that the new body will come under aegis of the Privy Council, as the CPSM urgently wishes. We look forward to seeing, and to being consulted on, details of the Government's proposals under the new order-making powers effected under the Bill relating to the successor to the Council for Professions Allied to Medicine.
The regulatory bodies are not asking for the status quo to be protected. They recognise that the order-making power could be very useful in modernising systems of self-regulation, and they welcome this. I should like to give examples. The GMC wishes to see the Medical Act 1983 amended to create a single system of registration for overseas doctors, a change which would now be possible only under primary legislation and one which would be greatly welcomed by the Commission for Racial Equality. It is also the wish of the General Dental Council to increase its lay membership and have powers over professional performance such as those now available to the GMC. These are all issues which readily could be, and we hope will be, dealt with by order. But fundamental change in the nature and functions of these bodies should be reserved to primary legislation for Parliament to decide.
I must now refer in detail to the purpose of the individual amendments. Amendment No. 202 is a purely technical amendment relating to others upon which it will be conditional.
Amendment No. 203 refers to the use of the term "professional body". The substance of this and other amendments is that there is no need for any reference to a "professional body" in the Bill since the order-making power should not be used to transfer functions away from existing regulatory bodies. Hence we propose the substitution of "regulatory" for "professional".
Amendment No. 204 is a little more detailed and complex. It adds to the protection specified in Amendment No. 210. It deletes the existing wording,
"An Order may not abolish the regulatory body of any profession",
and sets out other purposes for which an order-making power cannot be used. Heading (a) prevents the reduction by order of the proportion of professional members of a regulatory body.
Heading (b) preserves existing protections on the use of title or functions—in other words, non-dentists practising as denturists or non-state-registered practitioners calling themselves state-registered, which would be specifically precluded—and the penalties which might be imposed on those in breach. With regard to protection of title, I mention in passing that there is no law in this country to prevent anyone from practising medicine. One cannot practise as a dentist unless one is registered under the Dentists Act or unless one is a doctor acting in an emergency. One cannot practise as a veterinary surgeon unless one is registered. But the only protection in law for practising doctors is that it is illegal for anyone not registered under the Medical Act to call themselves a registered medical practitioner. That is the protected title in medicine.
Heading (c) protects the role of the Privy Council where it currently exists. The 25 lay members are nominated to the GMC by the Privy Council, which must approve the GMC's rules and its electoral scheme. Under the Medical Act 1983 default powers fall to the Privy Council. If the GMC is not discharging its statutory function, the Privy Council may notify the GMC and give instructions to it or exercise any power vested in the GMC; and in turn the GMC, or its education committee, may recommend to the Privy Council that a registration previously conferred by a training body, such as a medical school or university, should no longer be registered under the medical Acts. Any doctor who is struck off the register by the General Medical Council has the right of appeal to the Judicial Committee of the Privy Council. These are issues about which all the professions feel strongly, and the same issues relate to each of the professions.
Heading (d) reintroduces the prohibition on abolition of a regulatory body by order.
I realise that these are extremely complex matters. Sub-paragraph (2) of the amendment allows an order-making power to be used to enable a regulatory body itself to make rules to reduce the proportion of its professional members. The General Dental Council, for example, would like to be able to increase its lay membership by a change in rules, and the order-making power would be useful in achieving that.
Amendment No. 207 refers back to Clause 47. The effect is to exclude consideration of the Council for Professions Supplementary to Medicine at this point.
In Amendment No. 208 the amendment to line 6 on page 52 is crucial. The substitution of "regulatory" for "professional" removes any function of a professional body as defined in paragraph 10 of the schedule.
Similarly, by specifying "that regulatory" body, Amendment No. 209 prohibits the transfer by order of any function by a person or body other than the regulatory body which currently exercises that function. Such a fundamental change should not be made by secondary legislation.
Amendment No. 210 relates to misconduct. At present the Bill appears to allow for the possibility of a regulatory body acting as an agency or secretariat to a third party that decided the outcome of cases, hence the addition of the words "and determining cases", which is within the authority of each of the self-regulatory authorities at the moment. Any change in the function of determining fitness to practise cases would be fundamental and so should be reserved to primary legislation.
Amendment No. 211 simply adds, in paragraph (e), the need to include continuing professional development and education for those on a register, and paragraph (f) preserves financial independence to set fees for registrants.
Amendment No. 213 is an important amendment to which reference was made earlier today. The amendment seeks to achieve the same protections for the successor body to the CPSM. The Health Bill repeals the Professions Supplementary to Medicine Act 1960. As currently drafted, the limits in Schedule 3 would apply to the existing CPSM but not its successor. This is a matter of concern to that body.
Amendment No. 215 is consequent upon the earlier amendments. There is no need to define a professional body if there is no prospect that the core functions of a regulatory body will he taken over by anyone other than that body as a result of the order-making power.
Finally, Amendment No. 216 includes in the definition of a professional body a reference to its committees. We were not clear what the department had in mind in drafting that particular provision. However, having just deleted "professional body" under these amendments we have added "committees" to the definition of "regulatory body" for tidiness because many of the existing regulatory bodies have committees with statutory functions. Amendment No. 217 is a purely technical matter that relates to the earlier amendments.
I appreciate that this is a series of complex amendments, but because they are interrelated it is important to speak to each of them and to the principles that underlie them. I seek to reassure the noble Lord, Lord Peston, and other Members of the Committee that all of the self-regulatory bodies referred to in the Bill and those to whom I have referred in moving this amendment, are deeply anxious to maintain and improve their role in regulating the professional activities in all respects in the interests of the public. I beg to move.
5.15 p.m.
Earl Howe: I rise to express emphatic support for this group of amendments. With Clause 47 and Schedule 3 we are considering a part of the Bill that grants to the Secretary of State powers to make fundamental changes to the primary legislation that governs professional self-regulation. These powers are sweeping and unprecedented. To appreciate their import fully they need to be seen not merely as a set of self-contained issues but as part of a much wider agenda, evidenced by other parts of the Bill, to tighten political control over the medical profession. That prospect fills those of us on these Benches with deep dismay.
As the noble Lord, Lord Walton, said, professional self-regulation has been the cornerstone on which public trust and confidence in the medical profession has been founded for the past 150 years. One of the main reasons for that is that the professionals themselves have confidence in the system. The regulatory function of the GMC works because doctors know that the standards of conduct and practice that they uphold can be determined and assessed in the final analysis only by their peers. The Minister said at Second Reading that self-regulation was part of the quality agenda. To subject the medical profession to direct government control, as this Bill would allow, would be deeply detrimental to the quality of patient care.
If the aim of the Government is greater consistency of care within the NHS, as the Minister has said a number of times, that can be achieved perfectly well without these powers. I do not oppose the order-making powers in Clause 47 of the Bill; indeed, there is every argument for having them to make quick and sensible improvements to the detail of the regulatory framework of the medical profession as the need arises. However, I oppose the completely open-ended and sweeping nature of the powers. Nor do I understand why such powers are needed if Ministers' pronouncements on this subject are to be believed. The Minister herself said at Second Reading:
"We do not wish to dismantle the framework of professional self-regulation".—[Official Report, 9/2/99; col. 186.]
If that is so, the Government must say straight away that they accept the thrust of these amendments. If not, the despondency and distrust that is now evident in the medical profession will be magnified out of recognition. The Minister must realise that good intentions on this issue are not enough. If these powers are incorporated into the Bill those good intentions need count for nothing under a different set of Ministers in a future government. Underlying this issue is the need to achieve partnership and co-operation instead of conflict with the medical profession.
I very much hope that the Minister's hitherto constructive approach to debates in Committee and her desire to listen to the arguments put forward will again be evident in her response to these amendments.
Lord Kilpatrick of Kincraig: It is almost three years since I spoke in this Chamber. The occasion was my maiden speech. I was acutely aware of a remark by Sir Winston Churchill about a fellow Member in the
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other place. He said of that other Member that he had missed a great opportunity to remain silent. Accordingly, as I am now on my feet, the Committee will realise just how strongly I feel about the provisions of the Bill and how totally supportive I am of the amendments that have been described in detail by my noble friend Lord Walton.
In 1992, when I had been President of the General Medical Council for three years, the GMC unanimously backed me to approach the then government through the Privy Council to widen the powers of the council to include performance. At that time its powers relating to fitness to practise were confined to misconduct and health. This was a fundamental change because it allowed the council to deal with a deficiency in the day-to-day pattern of professional practice. I believe that a pattern of behaviour of that kind is confined almost exclusively to the medical profession. That cannot be dealt with under the criminal law. Therefore, the proposal was very far-reaching.
That approach having been made in 1992, it was three years before legislative time was obtained. Even then it was on the basis that the council could use its persuasive powers to gain all-party support, which it did. At that time, the noble Baronesses, Lady Cumberlege and Lady Jay, and Lady Robson, (sadly no longer with us) supported the provision and the Act was amended. Having had that experience of extensive consultation and detailed scrutiny which goes into a piece of primary legislation, I am convinced that no fundamental change should be made to a regulatory body such as the General Medical Council, although there are others, except by primary legislation.
At the same time, I am very supportive of the suggestion of having order-making powers. The General Medical Council wishes it had had them a long time ago. I can give a good example of that. From 1978, the council was allowed to deal specifically with the ill-health of doctors. However, under that legislation, which was introduced in an amendment to the original Medical Act, we were unable to suspend a doctor on grounds of ill-health for longer than one year at a time. Having chaired the council's health committee for some years, I found that it had to bring doctors back year after year, building up a large clinic. Clearly, the council needed the ability to impose indefinite suspension for some chronic disorders. In fact, that ability was tacked on by an amendment to the Medical Act relating to performance. However, it would have been a good example of order making not to change a fundamental function but to improve a particular function.
I am struck by the Explanatory Notes which accompany the Bill because they refer frequently to professional regulation. That means the regulation of a profession. The words "professional self-regulation" do not appear in the Explanatory Notes. That is the regulation of a profession by a profession with significant lay input.
I was not able to attend the Second Reading of the Bill, but I know that the noble Lord, Lord Ewing, who I know very well because we come from the same part of the country, said that the professions and the press

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never put their house in order until they are under threat of legislation. That is just not so. It was the General Medical Council which initiated the suggestion relating to performance, and it had to wait three years before parliamentary time was found.
Furthermore, it is frequently said that doctors and the profession are always defensive, but the important question in relation to the Bill is what is to be defended. I can envisage the possibility that Parliament might abolish a regulatory body such as the General Medical Council, which is not possible under the Bill; or it might remove a fundamental function from the regulatory body, which is possible under the Bill. If either act occurred, the position in the United Kingdom would be the same as in the majority of countries of the world. Only a minority of countries have professional self-regulation. They include Australia, New Zealand, Canada, South Africa, the Republic of Ireland and the United States. But if the United Kingdom were to become like the majority, something would be lost. There is a close and significant correlation between high standards of medical practice and professional self-regulation.
I endorse totally what was said so eloquently by my noble friend Lord Walton concerning all the amendments. I urge upon the Minister our view that there should be no transfer of fundamental functions from the present regulatory bodies and that primary legislation and the order-making power should continue within the context of the present regulatory bodies and professional self-regulation under the present relationship with the Privy Council.
Lord Clement-Jones: I rise to add the strong support of these Benches for the amendments. We expressed our considerable concerns about Clause 47. The amendments, which are vastly superior to our Amendment No. 206, go to the core of addressing the concerns of the professions allied to medicine about the terms of the clause. The clear and authoritative exposition of the noble Lord, Lord Walton, was perhaps too modest in expressing the absolutely united view of all those professions about the amendments and about the absolute necessity of altering Clause 47 to incorporate the safeguards.
The huge volume of mail in my postbag, which is awesome to behold, indicates the way in which the professions have united behind the amendments. I believe that they are very much in the interests of the public. It is not a matter of professional self-protection but of public protection. It is quite clear that if self-regulation is to continue, a hard core of elements must remain. The noble Lord, Lord Walton, clearly expressed them as the Privy Council relationship; lay member composition; no transfer without consent; no abolition; the levels of penalties; and jurisdiction over fitness to practise. Those are absolutely essential elements. They are not contained in the primary legislation and they must be if self-regulation is to be protected.
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In an extremely authoritative contribution, the noble Lord, Lord Kilpatrick, made clear the argument about flexibility. Of course we need flexibility, but we must have in primary legislation that core element to safeguard self-regulation.
The noble Earl, Lord Howe, made a strong point about the good will of the professions. In a time of change, we need that good will if we are to ensure that all the new elements are incorporated. The GMC—I single it out, but the point applies to other professions—has made massive strides, in particular with revalidation. Sir Donald Irvine has shaken up the way in which the medical profession is being regulated and we should welcome that. In return, we should provide those elements in order to ensure that the system, which is beginning to work much more effectively in rooting out incompetence, can work in a proper fashion. I urge the Committee to support the amendments.
5.30 p.m.
Lord Desai: I rise to express doubts about what is going on. The more the noble Lord, Lord Walton, spoke I became worried. Perhaps I may express my experience as a lay member of the Bar Council's committee of professional conduct. All that the Bar Council is worried about is that solicitors do not poach barristers' business. That is all it is interested in. Presumably, solicitors have the same worries about barristers.
It seems to me that self-regulation utterly failed in the City; we know that it failed. Before that, similar arguments were heard about how great self-regulation was. As a reader of newspapers, especially tabloids, I come across many scandals in the health service concerning the provision of medical care for patients. I do not know the technicalities. I am sure that everybody is very careful, and safeguards their professional standing. However, it does not seem that everything is all right in the way that doctors treat patients. I could make a similar comment about judges and barristers, but I shall not do so. However, we can no longer presume that the old regime will stay. Patients want to know more; they demand explanations; they are not satisfied by the way they are treated; apologies are late and appalling things happen.
As an economist I come from a non-regulated profession and I can do only limited harm to people. Anybody can practise as an economist. It is interesting how the debate has concentrated mainly on doctors and the General Medical Council. Of course, it is a most powerful profession, and it is difficult to do anything about doctors or lawyers in this country.
I welcome some of the provisions in Clause 47. The time has come when the public has to know that their interests are being looked after by somebody, and that somebody must be the Government. We can no longer take for granted that the public's interest is properly guarded by the professions. The noble Lord, Lord Kilpatrick, denied the fact that professions do not reform themselves until there are complaints. I believe that professions change only when there is a big row or a big scandal. Thank God that the press in this country

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makes a big row. There have been bad judgments from law courts, and mistakes have been made. I believe that self-regulation is very good, but, as my noble friend Lord Peston stated, we have paid a high price for barriers to entry in return, perhaps, for better quality. The Government must have power to give the public the assurance that if something goes wrong, they have one friend—the Government.
Baroness McFarlane of Llandaff: I rise to speak to the amendment tabled in the names of my noble friends Lord Walton of Detchant, Lord Kilpatrick of Kincraig, and Lady Emerton, who is, unfortunately, out of the country this week.
I do not want to reiterate all that my noble friend Lord Walton has said and take up the time of the Committee. As always, he has presented the arguments with cogency. However, I should like to say that all the healthcare professions to whom I have spoken have been in absolute agreement with the amendments. Not only the powerful medical profession, but also nursing, midwifery, health visiting, dentistry, pharmacy and many other professions recognise the importance of self-regulation for the interests of the public. We are at one in the wish to see self-regulation perpetuated.
However, as I talk to different professions, I believe that we are also at one in recognising the usefulness of orders for making quick and flexible changes. Therefore, I do not want to stand in the way of those who wish to use orders to see changes brought about in the profession, so long as such orders do not interfere with the fundamental roles of self-regulation.
As the report from the Committee so rightly states, and as the Minister quoted, striking the right balance between primary legislation and orders is the great conundrum ahead of us. Those of the nursing, midwifery and health visiting professions to whom I have spoken want to see many of the Government's proposals go forward so that there is flexibility, but they do not want to lose the right of self-regulation. That is why I asked the Minister for an assurance that there would be the same protection under orders. The Minister gave that assurance. I should like to probe a little as to how the noble Baroness can give the assurance that protection will be the same under orders as it would if written on the face of the Bill.
At Second Reading, the Minister indicated that the J. M. Consulting report had been published. The comments from the Department of Health, published the same day, indicated that the Government would seek to table an amendment to repeal the Nurses, Midwives and Health Visitors Act 1997 and that that, presumably, would be replaced by a body created by orders. Does that mean that nursing, midwifery and health visiting are entirely written out of the Bill and that their self-protecting powers and self-regulatory powers are entirely lost? I should like a reassurance that the protections we seek to build in by the amendments will be available in orders and that legislation will be put in place.
We are given so many reassurances. It sounds wonderful, and we think, "Yes, let's go forward with this". But, what happens? We are reassured that
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everything can be dealt with by an affirmative resolution. But what happens if an order is brought by an affirmative resolution and then negatived? Would we then have no powers to take forward what has been agreed? I should like reassurance about the mechanisms that will be available to us in orders, and exactly what is implied, particularly for the professions of nursing, midwifery and health visiting.
Lord Colwyn: I, too, should like to support the amendments. I only regret that I was a little slow and did not put my name down to be one of the main supporters. I apologise for that. I know that my noble friend Lady Gardner of Parkes, who was formerly an elected member of the General Dental Council, also supports the amendments. She has a prior engagement outside the Palace of Westminster and is unable to speak tonight.
The Committee will be aware that I am a practising dentist. As such, I know the value placed by my profession on maintaining the highest professional standards. Dentists provide care to their patients, whether under NHS or private contracts, from dental practices which they own and manage; practices which are predominantly in the high street, not hospitals and specialist centres. High standards and consumer satisfaction are what make dental practices thrive. Therefore, it is not surprising that the dental profession places a high value on professional regulation.
Under the leadership of Dame Margaret Seward, and with the support of the profession, the GDC has been focused on how better to protect the public. The Conservative Government promised to introduce much-needed reforms to the Dentists Act 1984. Those changes, which have become key issues, included recertification; a statutory obligation to provide evidence of continuing professional education on a five-yearly cycle, and the fact that current procedures, which deal with fitness to practise, focus only on misconduct and health matters and do not deal with poor performance.
The council, again with the approval of the profession, has been ready to introduce a statutory scheme to ensure that dentists whose clinical performance is a potential risk to the public are given the opportunity to relearn skills, with the ultimate sanction of their practice being restricted if they fail to demonstrate competence.
My purpose in highlighting these issues is to remind the Government that the council has sought legislative change and has been restricted by the nature of the current Dentists Act. The opportunity which this Bill provides to make the necessary changes by order, rather than through primary legislation, is welcome. However, as we have heard, the order-making power, as written into this legislation, does not contain the safeguards and limitations which the GDC and other regulated health professions feel are necessary to ensure a continuing independent role. The need for more lay members and the commitment to the principles of professional regulation exercised by dentists themselves are important issues.

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As currently drafted, the Bill does not protect the council's core functions. Education at both undergraduate and postgraduate levels, continuing professional development, recertification, and the monitoring of poor performance are key reforms in the public interest.
Finally, the GDC is unique among the health regulatory bodies in having statutory responsibility for hygienists and therapists who are important members of the dental team, a team that also includes dental nurses and dental technicians who also seek statutory registration. The Bill, as drafted, does not provide an opportunity for change which must be in the interests of the public and the profession. The Minister says that she wants to strengthen and modernise the systems of professional regulation. The amendment provides the necessary limitations and safeguards which the health professions seek.
Lord Rea: These amendments have been spoken to eloquently by two senior members of my profession and eminent members of the nursing and dental professions. They have expressed extremely clearly their concerns about the Bill with regard to professional regulation, and particularly self-regulation.
I know that my noble friend the Minister may not be able to accept the amendments as they stand, but I hope she will be able to say exactly why she cannot accept them. I hope also that she may have some suggestions about amendments that are acceptable both to her and to my former headmasters—if I may so describe them—the two former presidents of the General Medical Council, compared to whom I am only a schoolboy. I hope that my noble friend will take their concerns into account as they are widely shared not only by those in the medical profession but also by many of the other professions which are currently self-regulating. I daresay that when my noble friend is making up her mind on these amendments she will also take into account some of the remarks made by my noble friend Lord Desai.
Baroness Cumberlege: I intervene briefly and in a spirit of optimism. I take the point made by the noble Lord, Lord Clement-Jones, that one of the great challenges in the NHS is trying to unite the professional tribes. I believe that at a stroke the Government have succeeded in doing that. However, it is a pity that the professions have united against these clauses. I believe that both parties—the Government and the regulatory bodies—want a resolution. Indeed, in January, the Minister's honourable friend said that he was seeking to achieve just that. I know that the Minister, having chaired a hospital trust, recognises the importance of keeping the professions on board in order to provide services of quality. There is room here for accommodation.
I very much accept what the Minister said earlier about the backlog of work that needs to be tackled. I accept that some of the issues dealt with by the regulatory bodies need a speedy resolution and that order-making powers are appropriate in such cases.
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The noble Lord, Lord Walton, said categorically—I know that he is right—that the medical profession is not seeking to maintain the status quo; it really wants to see some improvements to its regulatory powers. I know that that is true of the other professions also. Perhaps those who drafted the clauses did not have enough finesse or sensitivity to pick up all the nuances. I know that the Minister will have listened carefully to what has been said—she always does—but I hope that if she cannot accept these amendments, she will return to her department to work out provisions that are acceptable to all. I believe that resolution is not far away.
5.45 p.m.
Lord Peston: I start with two very cynical remarks. First, I was interested in what the noble Lord, Lord Clement-Jones, said about the mail that he has received. I, too, have received a lot of mail, but all of it from the professional bodies. I did not get a single letter from a patient or a group of patients saying, "We desperately need to support the professional bodies in our own interests." I should be interested to know exactly what mail the noble Lord received; mine was certainly not the same as his.
Secondly, my heart goes out to the noble Earl, Lord Howe. I think of the many years I spent on that Front Bench and wonder what sort of speech I would have made on this occasion. I conclude that I would have made a very similar speech, if not precisely the same one. I reflect ruefully, however, that I made many speeches against order-making powers and the damage they did, resulting in the end of this and the end of that, only for the government of which the noble Earl was a proud member to march their troops through the Lobbies and defeat me on every occasion. There was no question of weighing the balance; the government simply defeated us. That was because, not only that government, but all governments, want to get not only their Bills through but also their order-making powers. I do not criticise the noble Earl for that. Either I was right then and he was wrong—or perhaps this Government are now right and I was wrong then. In any case we all have our part to play in the great drama that is the House of Lords, and the part of the Opposition Front Bench is to talk about order-making powers and the threat that they pose to the future of our great nation.
Having said all that, perhaps I should add—I have said this previously—that I am a great supporter of self-regulation. Wearing my economist's hat, I believe that self-regulation is an efficient way of delivering what is wanted by the clients who, in this case, are the patients. It would be quite wrong to ignore general principles in relation to this Bill. This matter relates not only to doctors, but to all the professions. I am not one of those who say that all professionals are just a bunch of racketeers although some very distinguished economists do take that view. Indeed, some of the world's greatest economists argue that all the professions are an abomination and need to be abolished. They say that their legislative support should be removed and that they should have to compete in the free market because the free market would expose the good as opposed to the bad. That is not a view I hold,

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but I can tell the Committee that economists who are Nobel Prize winners do take that view. I do not; I do not go that far.
This is a serious matter. Professions have responsibilities if they have the power of self-regulation, and they must deliver the goods. In my experience, my noble friend Lord Desai is right. On the whole, the professions deliver when they are subject to pressure. I do not criticise them for that. I am not a professional in the same sense, but as a professor it never occurred to me that anything I did was ever other than perfect. I always felt that I was doing a proper, professional job. I always professed to be doing absolutely the best I could in the interests of my students. Occasionally, I was subject to professionals saying, "Would you prove that?", and I hated that, just as I am sure that all the leading medical professionals and all lawyers also hate it. That is why I do not greatly criticise the professions for saying, "Don't attack us too much because we'll move when we can." However, it is important also to view matters from the other side.
It had never occurred to me that the Government's position was that they favoured deregulation—perhaps my noble friend will comment on that—or that they intended to use the order-making power in any way other than as a last resort. Occasionally, of course, it may be used as a first resort when the professions themselves want change rapidly and do not want to sit in a very long queue awaiting primary legislation.
As I said earlier, when I was a member of the Council of the Royal Pharmaceutical Society there were matters to be considered including fitness to practise and so forth. One's heart sank when one was told that it would be years before something could be done. I certainly wish to see the order-making power used for that purpose. Therefore, I hope that the Minister will be able to state the Government's intention to reinforce the professions and to be supportive of them. I hope that it will be done in ways which the noble Lord, Lord Walton, and his fellow supporters of the amendment like. But an order-making power is required. That would be in the interests of the professions. It would be seen that their performance was good, not recognisably perfect, but getting better. I hope that my noble friend will speak as sympathetically as she can. However, I shall be a little taken aback if she felt she should accept the amendment.
Baroness Carnegy of Lour: Perhaps I may ask a quick and more detailed question as regards the inter-relationship between Clause 47 Schedule 3 and the Scottish Parliament. The Explanatory Notes state that Schedule 3, paragraph 5,
"will enable functions to be conferred on … Scottish Ministers [and that] an order could be made … setting up bodies for different parts of the United Kingdom to deal with matters in connection with professional regulation".
Can the Minister say whether it is conceivable that paragraph 5 of Schedule 3 could allow Scottish Ministers to set up bodies which conflicted with those protected from change under the Bill? I am trying to be helpful to the Government in this case. It may be that there is a clash between what is allowed under that
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paragraph and what the Minister told me about paragraph 2 as regards what an order may not do. It will be helpful and comforting to know the answer to that question, if it is possible.
Lord Christopher: I had not intended to speak in this debate until I noted that the president of the General Medical Council, under whom I served for some five and a half years, was speaking in it. I left the GMC after that time because the law said that I should at my age. I found that somewhat troublesome at the time because one of the matters being discussed was euthanasia.
The noble Lord, Lord Kilpatrick, earned my respect, as has his successor, Sir Donald Irvine. Having listened to some of my colleagues perhaps I may make a few remarks which may encourage the supporters of the amendment to reflect. I recognise that they will wish to hear what words of comfort may come from our own Front Bench.
A number of factors relating to the GMC do not justify the worries which the supporters of the amendment have. In my experience the medical profession can only be effectively regulated, under whatever umbrella, by doctors. I have served on the ethics and the disciplinary committees. It is perhaps worth mentioning in passing that the doctors were invariably tougher with those against whom allegations had been made than were the lay members. Now there is such a range of professions. There has been mention of a disease and there is a specialism for that. I do not myself see that doctors could ever be other than largely in a majority. I do not believe that a lay committee could effectively do what was required in majority terms.
The president of the General Medical Council is not a kind of union general secretary, but there are similarities. 1 recall a number of debates in which the noble Lord, Lord Kilpatrick, fought very hard to persuade members towards some change and received a good deal of opposition in the process. As the general secretary of a union in the past, I know how useful it was to have some sanction which enabled me to say to people, "If we do not perform in the way that the public expect we are under an earlier threat than we might have been otherwise under the regulations".
I cannot believe that the GMC is under any serious threat of becoming nationalised provided that it performs well. It is most likely to be able to do so by achieving quick change rather than in a three-year cycle, which I remember very well. Parliamentary time stood in the way of change and it will stand in the way of other change in future, the nature of which we cannot judge. I say to my noble friend Lord Peston that most of the doctors I came across who had gone down the market road were struck off. Therefore, there is not a serious threat in that direction. 1 believe that, subject to what the Minister has to say, it will be good to give some thought to this area. I do not believe that the fears expressed are fully justified although I understand them.
Baroness Hayman: We have had an extremely useful debate about an area of this legislation which is of great importance to all who have considered the issues concerning professional self-regulation. At the

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beginning I assure the noble Lord, Lord Kilpatrick of Kincraig, that there is no sinister motive surrounding "the regulation of the professions" as set out in the Explanatory Notes rather than professional self-regulation. I hope that I have made it absolutely clear on a number of occasions that the primary purpose of the Government is the protection of the public. As has been eloquently expressed this afternoon, we believe that with these professions the public has been in the past, and will continue to be, best protected by effective self-regulation of the professions.
The purpose of bringing forward these proposals is not in any way either to dismantle professional self-regulation or undermine it. I feel a little bruised occasionally. The point has been made many times in the debate today about the pressure from the professions themselves regarding the frustration they have felt at being unable to amend the provisions concerning professional self-regulation. There are concerns that we may not have drafted the legislation correctly. That is usually expressed first. Then there is a kind of throwaway line that the need to do that is recognised and that it is not desired to stand in the way of the general principle.
Perhaps I may put the matter the other way round. It is in everyone's interest to get on with the job of strengthening professional self-regulation and the order-making powers are brought forward in order to achieve that, and not for any sinister motive. On that basis, I hope there has not been produced the despondency and distrust to which the noble Earl referred. Some people will be glad that they will be nearer to getting on with the job that needs to be done in terms of providing a more satisfactory framework for professional self-regulation.
I was looking at the terms in which the professions supplementary to medicine can deal with individual members. They have to look at the conduct of individual members and see whether there has been,
"infamous conduct in any professional respect".
I am not sure that that is the most appropriate way of looking at "fitness to practise" issues as we approach the 21st century. There are a whole raft of areas in relation to protection of title about which we have talked at great length today where those proposals will be of absolute benefit. To be more conciliatory, I was particularly grateful to my noble friends Lord Desai and Lord Peston for bringing economists into the debate. It would unite the whole Committee to agree that the public deserve to be afforded some protection from the profession of economists who are as capable as anyone else discussed tonight of doing harm.
At Second Reading I explained the broad thrust of our policy regarding the order-making power. We are seeking to provide a mechanism that will enable us to modernise and strengthen the existing systems of professional self regulation. We intend to work with the professions to ensure that those systems are more open, responsive and publicly accountable. A number of proposals are already on the table for the use of the power. The replacement of the Professions Supplementary to Medicine Act and the Nurses, Midwives and Health Visitors Act are two such proposals. But the other professions also have changes
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that they wish to make. Those have been alluded to today. The dentists, the professions supplementary to medicine and the pharmacists are anxious to make progress. The order-making power must therefore be of sufficient scope to ensure that the differing needs of each profession can be met. That is sometimes where difficulty arises. One professional group looks at the provisions as they stand and feels that they are wider than they want. But it does not look across the whole span of what we need to do.
We recognise—as I hope I have made clear throughout our debate—that there need to be safeguards. The Bill currently contains a number of important safeguards which have been widely welcomed. I have mentioned too the procedural requirements around consultation and affirmative procedures which we intend to strengthen in the light of the recommendations of the Delegated Powers and Deregulation Committee. I hope that the noble Baroness, Lady McFarlane, will accept that these are not just reassurances or empty words; they are government proposals to bring forward amendments that will be on the face of the Bill.
There is also the provision that the main regulatory bodies cannot be abolished—with the exception of the CPSM, and soon the UKCC, for the reasons I explained—and I shall come later to the safeguards that we must introduce for those successor bodies. I take the point that they should not be left in limbo but should be allowed the same protection as the bodies that will be ongoing. The four functions which we believe are at the heart of professional self-regulation—the keeping of the register, the setting of standards of education for entry into the profession, the provision of guidance on standards of professional conduct and fitness to practise procedures—cannot be removed from professional regulatory bodies by order.
We therefore have clear limitations on the order-making power already on the face of the Bill. But, as I said at Second Reading, we are seeking to do something which we believe to be in the interests of the professions themselves as well as in the interests of patients. And if there are ways in which we can improve the balance which needs to be struck in these provisions—of ensuring sufficient scope to make the changes that need to be made and providing appropriate safeguards—then we would consider them carefully and constructively.
That is the light in which I have listened to the debate. Perhaps I can therefore turn to a number of different issues which have been raised. The Committee will understand that the changes that we may bring forward will need to be drafted not necessarily in the way that they are drafted in specific amendments.
I turn first to the issue of lay membership. We received representations from some of the statutory regulatory bodies about their concerns that the order-making power might be used to impose a majority of lay members on the bodies. My honourable friend the Minister of State for Health and I wrote to the regulatory bodies to reassure them that,
"We welcome the moves of some Councils to increase lay membership and improve accountability to the public and would want to see the power used for such changes quite soon. We would not, however, wish to impose a lay majority".

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We understand the great importance attached by the regulatory bodies to the fact that they are part of the system of professional self-regulation. It is clear that one of the main advantages of such a system is that there is a large measure of professional knowledge and experience in the membership of the body, leavened by a good proportion of lay involvement. As has been pointed out, the GMC, in the past couple of years, increased the proportion of lay members to 25 per cent. while the Medical Act still requires a majority of members to be elected by doctors on the medical register from those on the medical register.
It is equally important that self-regulation should not operate to the exclusion of perspectives other than those of the profession concerned. The presence of lay members on regulatory bodies and committees serves many functions. It provides an opportunity to involve people with different expertise and experience. It also ensures that professional regulatory bodies do not operate in isolation from developments and changes in other parts of the professional world or society at large.
The point was made that the climate in which professional self-regulation takes place today is very different from the climate in which some of the original legislation was passed. Perhaps most importantly, lay involvement reinforces and provides a visible demonstration of bodies' commitment to regulation which places the public interest—be it that of individual patients or the public at large—above those of the profession itself or of its individual members.
I know that the General Dental Council wishes to increase its lay membership from six to 12 and that the Royal Pharmaceutical Society of Great Britain consulted on proposals which will alter the composition of its statutory disciplinary committees while ensuring that there continues to be a strong lay element. We are sympathetic to the spirit of the amendments tabled on this issue. We do not wish to impose a lay majority. I shall therefore consider placing this commitment on the face of the Bill. I should like to consider the issues raised in this debate and bring forward proposals.
I turn now to the issue of penalties and the amendment which seeks to ensure that there is no reduction of penalties. I applaud the sentiment behind the amendment. We need to give patients effective protection from charlatans. There will be little protection afforded if protection of title is not backed up by the possible imposition of a penalty. I can assure the Committee that the Government have no intention of weakening the deterrent against potential abuse. However, for a criminal offence, two elements determine the penalty which may be imposed. One is the maximum level on the standard scale at which a fine may be levied. The other is the actual amount that is attached to each level as set out in the standard scale. The standard scale applies to all criminal offences, not just those in respect of professional self-regulation. The proposed amendment would limit any subsequent review of penalties and while, as I said, we have no intention of weakening the deterrents available in this field, given the integration with Home Office
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responsibility on other criminal penalties, it would be wrong to be prescriptive on the face of the Bill on this issue.
I turn to the role of the Privy Council. I understand that many of the professions attach great importance to their accountability to and relationship with the Privy Council. There are many matters that at present require the approval of the Privy Council; for instance, the making of rules for fitness to practise committees. We are happy to see those accountability arrangements for the existing regulatory bodies continue.
In respect of new and replacement organisations, I think it is right that their lines of accountability should be fully explored through consultation at the time they are set up. The Government have given a commitment in relationship to the CPSM, for example, to address this issue as part of the discussions with the professions on the constitution of its successor body. We would nevertheless expect strong justification for change where the present arrangements can be shown to have worked well.
I should point out that this is not the only model that can work well. The UKCC is accountable not to the Privy Council but to the Secretary of State and that accountability relationship has been very effective. I have heard the concerns which have been voiced today, however, particularly in relation to the professions allied to medicine. It would perhaps be helpful to say that when we do consult on the replacement body for the CPSM we intend to do so on the basis of retaining accountability to the Privy Council for any such successor body.
We have argued thus far for avoiding placing this sort of detail on the face of the Bill but, given the strength of feeling that has been expressed this evening, I would be grateful if the Committee allowed me to consider the matter further and to undertake that I would he willing to bring forward an appropriate amendment, if it is possible to formulate one—and I believe that there are some difficulties in the drafting here—which preserves the role of the Privy Council in respect of the existing regulatory bodies.
I turn now to the transfer of functions from the regulatory bodies. I have already made clear our intention to ensure an appropriate balance between flexibility and safeguards. I am grateful for the contributions to this debate in assessing whether we have struck the balance appropriately in the Bill as currently drafted. I take the point that the nuances may not have been perfect in original drafting. One of the benefits of introducing a Bill in your Lordships' House is that we have the opportunity to go into this sort of detail and to look at ways in which it can be improved. I hope that this will not be seen as backtracking or sinister motives, but as a genuine attempt to get that balance right.
On the issue of determining cases, the Government remain concerned about poorly performing doctors and other professionals and are considering the best way forward on a whole range of issues arising from handling doctors' performance in particular. This includes identifying poor performance and dealing with

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it, either within or outside the disciplinary procedures as appropriate. We consider that the role of the statutory regulatory bodies in administering the procedures relating to misconduct, unfitness to practise and similar issues is a fundamental matter that may need to be modernised: but we are clear that, if professional self-regulation means anything, the profession's regulatory body should determine individual cases and we have no intention whatsoever of removing this function from the regulatory bodies.
I am sure that the phrase "administering procedures" in paragraph 8(2)(d) of Schedule 3 also includes the determining of individual cases. On that basis I believe that that amendment is unnecessary. I hope that explains our position and will give some reassurance to the noble Lord, Lord Walton, that it is not necessary to press his amendment on this particular issue.
In respect of Amendment No. 211, which adds the functions of determining fees and continuing professional development to the list of fundamentals, I can assure the Committee that the Government are fully committed to encouraging and promoting continuing professional education and development. Indeed, the encouragement of life-long learning is one of the Government's key objectives across the board, not only in the field of health and healthcare and not only for the professions, although of course it is of key importance for the professions.
The independence of the statutory regulatory bodies from government interference in the minutiae of their workings is understandably important to them. Financial matters give cause for much debate in the medical profession especially, and the freedom to set registrants' fees is an important matter for all professions if they are to maintain their financial viability. It is not the Government's intention to wrest control of bodies' financial arrangements from them, and I can say categorically that we would not be using the order-making power so to do. I do not believe, however, that it is an issue so fundamental that it is appropriate to place this level of detail on the face of the Bill.
We have said that there are four fundamental functions which are essential to what we understand as professional self-regulation: keeping the register; setting the standards of education for entry into the profession; the provision of guidance on standards of professional conduct, and fitness to practise procedures. We believe that we have these essential functions, which need to be protected, right and we believe that they should be maintained.
The amendment of the definition of a regulatory body to include its committees raises a number of important issues, when taken together with the other amendments. It would, for example, prevent the abolition of any committee of any of the regulatory bodies. This will need careful thought. While the Government have no wish for a power which permits the removal by order of functions which are central and necessary for proper regulation of the professions, we are equally concerned to ensure that the power we do take is flexible enough to deal with as yet unforeseen developments. In this particular case, I am anxious that we should not end up
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with a position which prevents an order being used to bring forward proposals for the statutory regulatory bodies to modernise or rationalise existing committee structures. I am therefore of the view that this amendment would make the order-making powers unnecessarily inflexible.
I should like now to deal with the issue raised by the noble Baroness, Lady Carnegy, and to reassure her that there can be no separate regulation of the currently regulated health professions in Scotland. It is a reserved matter, subject to the caveats about new professions which I made earlier. This gives the power to the UK Government to confer functions on the Scottish Ministers, if it were felt appropriate. There are analogies now in the national boards for nurses, midwives and health visitors. I hope I have assured her, however, that there is not the possibility of a dual structure.
6.15 p.m.
Baroness Carnegy of Lour: I thank the noble Baroness very much for that. The position is perhaps a little more complicated, and it might be that her colleague the noble Lord, Lord Macdonald, will be able to look at it from the point of view of the Scottish Office and write to me. I could then pass that on to the British Medical Association. Would that be in order?
Baroness Hayman: That would be extremely helpful, and I will ensure that the noble Baroness receives a letter on that point.
I come now to what seems to be the most important issue: that of whether any of the four fundamental functions that I have described can be removed from the existing regulatory bodies. I have listened very carefully to the arguments on this point. I understand the concerns that have been expressed, particularly by those who are proposing these amendments. I would like to reassure them that it has never been our intention to transfer the fundamental functions of the regulatory bodies to any government-appointed puppet body; nor has it been our intention to transfer such functions to representative bodies or trade unions such as the BMA, the RCN or the BDA. If the drafting allows for that, then it is inadvertence rather than malice that is to blame.
We sought to ensure that there was the flexibility to transfer functions from one professional regulatory body to another professional regulatory body, should it he appropriate to do so at some point in the future. In the light of the points which have been raised this evening and my discussions with the various regulatory bodies, however, it seems that the balance of which I spoke earlier, and for which we are aiming, has not quite been achieved in paragraph 8(1) of Schedule 3 to the Bill. There is a concern that the removal of any one of the four fundamental functions from the main regulatory body of the profession through the use of the order-making power would extend the scope of the Bill too far. Therefore, I shall bring forward an amendment at Report stage to ensure that the order-making power does not encompass such a step.
As we intend that the Professions Supplementary to Medicine Act 1960 and the Nurses, Midwives and Health Visitors Act 1997 should be repealed under this

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Bill, special provision will be needed in the case of the CPSM and the UKCC. I can assure the Committee that any successor bodies should have the same protection of functions as that reserved to the existing regulatory bodies. We will be putting the same safeguards on the face of the Bill for the successor bodies to the CPSM and the UKCC.
I hope that the Committee will feel that we have listened carefully to the concerns expressed both outside the Chamber and in today's debate. I trust that noble Lords will understand that we have tried very hard to ensure a balance that perhaps reflects more accurately our recognition of concern that we should ensure enough flexibility to be able to get on with doing what is agreed to be necessary but that we should not leave the possibility of undermining the structure of professional self-regulation which is valued not only by the professions but also by the Government. On the basis of the assurances I have given, which will be backed up by amendments I shall bring forward at the next stage, I hope that the noble Lord, Lord Walton, will feel able to withdraw his amendment.
Lord Walton of Detchant: In many respects this has been an exceptional debate. It has been inspiring in many ways and, certainly for me and, I am sure, for others, heartwarming and immensely interesting. I pay an exceptionally warm tribute to the Minister for the very careful, well-judged and, if I may say so, co-operative, constructive and courteous way in which she responded to our concerns. I pay also special tribute to my noble friends Lord Kilpatrick and Lady McFarlane, and to all of those Members of the Committee who have spoken. I assure the Minister that in tabling the amendments we recognised the good will of the Government and the fact that they had no intention of dismantling the present self-regulatory mechanisms which I genuinely believe have served the professions, and especially the public and patients, very well over many years. However, these are mechanisms in need of modification. The establishment of order-making powers will enable long-awaited changes to be made.
In passing, I should like to tell the noble Lord, Lord Desai, of a recent opinion poll which showed that 92 per cent. of the public trust their doctors. Politicians came out at about 30 per cent. and journalists at about 15 per cent. I do not remember where economists came.
I should point out to the noble Lord, Lord Peston, that I have had several approaches in this respect, although I have not heard from the noble Lord, Lord Christopher. I was not aware that he had become a lay member of the GMC after my presidency ended. However, I have had several approaches from existing lay members of the GMC saying how much they wish to see the powers changed by order-making but how much they also wish to see the fundamental structure of the council's functions preserved.
I am sorry to learn that the lay membership of the noble Lord, Lord Christopher, ended on grounds of age. As a former trade union leader, he must have felt a little like the trade union leader who had been in hospital and
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received a letter from his executive committee wishing him a speedy recovery by nine votes to six, with five abstentions.
We have had an extremely useful debate. I was surprised to learn from the Minister that, under the Professions Supplementary to Medicine Act, the term "infamous conduct in a professional respect" is still used. That was introduced, on the advice of Lord Justice Lopes, into the medical Acts in the 1890s. However, it was subsequently amended to "serious professional misconduct", which is the term most recently used. I am surprised that that archaic term still persists; I am sure that it needs to be changed.
The Minister said a great deal about the safeguards she proposes to introduce into the Bill by government amendments at Report stage. I also seem to recall that she said the word "regulatory" might well replace the word "professional" and that the issue of transfer of powers, about which we have been very concerned, will be dealt with by way of amendment. Moreover, I understand that the very important question of the interposition of the Privy Council between the self-regulatory bodies and government will be dealt with on Report. Indeed, I believe we have received a number of assurances which the professions and all those involved in self-regulation will regard as being most welcome. In the light of those assurances, I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
[Amendment No. 203 not moved.]
The Deputy Chairman of Committees (Lord Strabolgi): I should point out to the Committee that if Amendment No. 204 is agreed to I cannot call Amendment No. 205.
[Amendment No. 204 not moved.]
Lord Monkswell Lord Monkswell moved Amendment No. 205:
Page 52, line 3, at end insert ("nor abolish that part of the register continued by section 7(1) of the Nurses, Midwives and Health Visitors Act 1997 which relates to midwives").
The noble Lord said: In moving this amendment I shall speak also to Amendment No. 212, which stands in my name and also the names of the noble Lord, Lord Clement-Jones, the noble Baroness, Lady McFarlane, and the noble Earl, Lord Howe.
The amendments are by way of a marker to show our respect for midwives—a respect felt by all sides of the Committee and demonstrated by the names of the supporters. I pay tribute to the Royal College of Midwives, which has provided invaluable advice.
Midwives are a separate and distinct professional group; in fact, one of the oldest professions serving humankind. They provide invaluable services to expectant mothers at the time of birth and ensure the good health of both mothers and babies. In the context of this debate, midwifery is a separate and distinct profession from nursing. Therefore, Amendment No. 205 seeks to ensure that there will continue to be a separate and distinct register of midwives.
Amendment No. 212 is a little more complicated. My understanding of the Government's proposals in this part of the Bill—namely, Clause 47 and Schedule 3—is that the order-making power to vary the legislation affecting the self-regulation of the healthcare professions will be brought into play when the professions approach government with proposals for change that previously would have required primary legislation. However, in the cases of nurses, midwives and health visitors, the Government have initiated a review and we have the report of J. M. Consulting before us. The report recommends a new council of nursing and midwifery with equal representation of nurses and midwives on the basis that health visitors are a specialist branch of nursing and would be represented by the nursing side, while midwives as a distinct profession—not all of whom are nurses—would be represented by the midwives side.
However, in their response to the report the Government suggest that nurses, health visitors and midwives should be represented equally on the new council. This would mean midwives being a minority. There is a feeling that their professional integrity and distinctiveness would be subsumed over time. Therefore, Amendment No. 212 seeks to ensure that safeguards are written into the Bill to protect the professional integrity of midwives and ensure effective self-regulation of their profession.
Although these amendments are presented in good faith, I accept that there are drafting flaws. However, they run counter to the general thrust of the Bill in trying to introduce specific details. I advise the Minister at this stage that they are probing amendments. However, I hope she can provide assurances to midwives, and those of us who are keen supporters of midwives, that their professional integrity is recognised and that their fears that their professional self-regulation may be weakened will be allayed. I beg to move.
6.30 p.m.
Lord Clement-Jones: I speak briefly but emphatically in support of the noble Lord, Lord Monkswell, in putting forward these amendments. The Minister has made us aware of discussions and consultations that have yet to take place. I certainly do not wish to pre-empt them. If the Government have not yet taken a view on these matters, so much the better. It would be helpful if the Minister can at least indicate the state of thinking in this area. As the noble Lord, Lord Monkswell, made clear, one of the problems is that the recommendations of J. M. Consulting in respect of health visitors have not been accepted by the Government, and therefore in a sense the balance on the new body is not to the liking of midwives.
As regards the retention of the midwifery committee, I am not sure what the Government's thinking is. But clearly midwives feel strongly that it must be retained. We have talked about control over education, training and standards of practice. Midwives believe that they constitute a separate profession and that they are best regulated by a committee under the overall council, as the noble Lord, Lord Monkswell, made clear. The
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retention of the midwifery register, if nothing else, goes absolutely to the heart of the matter. Midwives feel strongly that it should be retained.
I realise that it is easy to view many of the debates we have had as representing the professions pleading their own self-interest. However, I do not believe this is simply a matter of self-interest. I believe it is a matter of public interest. I have a huge regard for the midwifery profession, not least because my wife has been a consumer of their services in the past year. We need to maintain standards in this area. We do not want midwives to be subsumed into the generality of a much bigger profession. That must be seen as a threat to them. I hope that the concerns of midwives will be accommodated in the course of the discussions which the Government will pursue.
Earl Howe: I too wish to support these amendments. With the prospect of the repeal of the Nurses, Midwives and Health Visitors Act 1997, I think it is terribly important that safeguards are put in place to protect the essential features of the regulatory regime for midwives. This Bill provides an ideal opportunity to do so. Midwives are the third largest professional group in medicine. They can diagnose, prescribe for, and treat a number of specific conditions without reference to a GP, and as a result they are a profession which lays particular emphasis on training and continuous professional development. It would be most unsatisfactory if there were ever any confusion or uncertainty over which education and practice issues were relevant to midwifery.
There is absolute unanimity in the profession about wanting to see acknowledgement of midwifery having control over its own professional destiny and in particular its own education and practice. That can really only be done by strengthening the representation of midwifery on the central council. Whether you achieve that by having a separate midwifery committee, or by having equal representation of nurses and midwives on the council, is open to legitimate debate. I hope that the Minister will at least be receptive to the thrust of these amendments.
Baroness McFarlane of Llandaff: I too wish to speak to the two amendments which bear my name. I regard them as probing amendments because I believe they may well be overtaken when we arrive at a firmer resolution of what is envisaged for the successor body to the UKCC. I have tried to do the arithmetic with regard to the successor body with perhaps 24 members, a third of whom will be lay members, with representatives from four countries. I do not know whether the Minister is prepared to do the arithmetic and divide up the successor council, rather like Solomon wanting to divide the baby between the two ladies. She will need the wisdom of Solomon in this regard. We need to be careful that the particular professional expertise of midwives is guarded. We have already heard that they undertake considerable independent clinical decision-making.
Baroness Hayman: Our brief debate on this issue is analogous to the debate we had on chiropody and

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podiatry. We are debating the contribution of important professional groups. In this Bill we establish an enabling structure to allow successor bodies to be put in place. I cannot give the Committee chapter and verse on every detail of that successor body. However, the Government fully understand and share the aims that have been expressed of preserving the strong identity of midwifery as a separate profession within a joint regulatory structure. Midwives have been at the forefront of developing services which are more focused on what patients want and need. They rightly expect to have a strong and decisive voice in the regulation of their own profession. That is why we made clear in our response to the recent review of the Nurses, Midwives and Health Visitors Act that any proposals we put forward for legislation to replace that Act will provide for the separate registration of midwives. The new council will have a duty to make rules on midwifery practices. There will be equality of elected membership of the council between the professions. However, I shall not follow the noble Baroness, Lady McFarlane, into the judgment of Solomon which, as she rightly says, we may need as regards the allocation of places on the council. Perhaps most importantly, the structure and rules for the committees should ensure that midwives cannot be outvoted by the other professions on matters solely affecting midwifery. That is an extremely important point, as indeed is the recommendation, which we support, that the council should create a post of director of midwifery regulation.
As I have said many times today, it is our intention to repeal the whole of the 1997 Act and abolish the UKCC. We shall bring forward an amendment to enable this. We intend to consult fully on the detailed proposals for the replacement legislation. As the noble Lord, Lord Clement-Jones, recognised, that process has started. It would be wrong, through this amendment or through any comments I make on further detail, to pre-empt that consultation. However, I am happy to repeat the commitment that we shall not bring the repeal of the Nurses, Midwives and Health Visitors Act into effect until we are ready to put in place a new scheme that commands public and professional confidence. We shall consult with each of the professional groups involved to ensure that we strike the right balance between the multi-professional overall body and the representation of individual professions, particularly the midwives, in areas relating to their own practice. I hope this provides some reassurance to the noble Lord.
Lord Monkswell: I thank everyone who has taken part in the debate on this amendment. I thank particularly my noble friend the Minister. I think we are all reassured by the specific assurances she has given from the Front Bench. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 206 to 213 not moved.]
Baroness Wilcox Baroness Wilcox moved Amendment No. 214:
Page 52, line 20, at end insert (", and
(c) consult patients and carers.").
The noble Baroness said: In moving the amendment I must declare an interest. I am the president of the National Federation of Consumer Groups. Having been involved in the consumer representation world over a number of years, I have taken a considerable interest in the way the professions organise themselves. In this House I raised the issue of professional rules during the passage of the Competition Bill in the previous Session. Professions perform important services for us all. This is particularly so in the field of healthcare where the professions try to keep us healthy, look after us and treat us when we are ill. But by their very nature professions can have considerable power over those to whom they provide a service. And we all know that things can go wrong, sometimes disastrously so.
Regulation of the professions is therefore important for the consumers of their services. In healthcare, bodies such as the General Medical Council, the General Dental Council and the General Osteopathic Council provide statutory self-regulation, as we have heard so well expressed today. Those who use the services of the professionals need to be confident that they are adequately trained; that they operate to minimal standards of competence; that clients have somewhere to go if things go wrong; and that appropriate disciplinary action is taken if a member of the profession is found guilty of misconduct.
Each profession is regulated under a law specific to it. This has led to anomalies developing between different professions, which everyone acknowledges need rectifying. For example, the General Medical Council has powers to act where doctors' performance is not up to standard, while the General Dental Council does not have such powers. Some councils have powers to act where the health of a professional is causing poor performance; others do not. And, worryingly, many professions—psychologists, counsellors, psychotherapists and many working in complementary therapies—have no statutory regulation at all.
Changes to these schemes currently require primary legislation. As we all know, relying on spaces in the legislative timetable is a somewhat precarious and inflexible process. The provisions in the Bill to enable these changes to be made through an order rather than primary legislation are very welcome.
My amendment, which is supported by the National Consumer Council and other organisations within the Patients' Forum, relates to the process of making the order. Paragraph 9 of Schedule 3 requires the Secretary of State for Health to lay a draft order before Parliament. He is required to publish the draft order and consult professional bodies about the draft. The purpose of my amendment is to require the Secretary of State to consult also with users and carers as well as the professions. The regulation of professionals has implications for the users of their services and any changes must command their confidence.
In support of my case, perhaps I may quote what the Government said in the White Paper, The new NHS Modern Dependable:
"The Government will continue to work with the professions, the regulatory bodies, the NHS and patient representative groups to strengthen the existing systems of … self-regulation by ensuring that they are open, responsive and publicly accountable".
I believe that my amendment is in the spirit of that very welcome statement. Professional self-regulation is not just about the professions but about the experiences and needs of patients and carers too. They have an important view. Statutory provision for consultation should include them on the same basis as the professionals. I beg to move.
Baroness Pitkeathley: I rise to support the spirit of the amendment. It is in accord with the huge amount of progress that has been made in recent years in making the patient, the user and the carer infinitely more central to healthcare provision than has hitherto been the case. The amendment is very much in that spirit in recognising that the experience of the patient and the carer should be important to all the professional deliverers of that service.
6.45 p.m.
Baroness Hayman: I am grateful to both noble Baronesses who have spoken for allowing me the opportunity to say that, in a sense, this is the counterweight to some of the discussions we had earlier and a recognition that we should not underestimate the importance of the views of those who are at the receiving end of professional services. Opening up government and public services and making them more responsive to the public and public service users' views is a key theme for the Government. We have made our commitment clear in the White Paper, as the noble Baroness, Lady Wilcox, pointed out. The Government are working to attain more effective public and user input into the development of policies. For instance, they have developed with the help of some national patient organisations a set of principles to follow involving user organisations in the development of health service policies. They have also established a standing advisory group for consumer involvement in research and development which includes user-group representatives to advise on the best way to involve consumers more fully in the department's research programmes. In the White Paper and in our discussion document A First Class Service we made it clear that we expected the statutory regulatory bodies to work in partnership with the Government, the NHS and patient representative groups to strengthen the existing systems of professional self-regulation by ensuring that they are open, responsive and publicly accountable.
As we have said many times this afternoon, protection of patients is at the heart of professional self-regulation. It is important that we consult with patient representative bodies on draft orders and it is certainly our intention so to do. There are, of course, a number of interested bodies and parties which should be
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consulted on a draft order. We will work closely with them in developing those orders and consult fully according to the processes I described earlier today.
As ever, we have returned to a recurring theme of some of the Committee's debates—how we avoid listing the people to be consulted in any set of circumstances and the dangers of making that list exclusive. However, I suspect that we have been too paring in the provisions in this regard. We have made it clear that there is a responsibility to consult the professions. Equally, we should make the necessity of consulting patient representatives clear on the face of the Bill. If it is possible to draw up something suitable, and if the noble Baroness would be content, I should like to give some further thought to this matter and see whether at some stage in the further progress of the Bill we can bring forward a suitable amendment.
Baroness Wilcox: I am grateful to the Minister for that very heartening response. I should like also to thank the noble Baroness, Lady Pitkeathley, for supporting the amendment. It is only recently that she represented so well the country's carers. I am very happy to have her support at this time.
Given what the Minister has said, of course I will be happy to withdraw my amendment at this time. I look forward at the next stage to hearing what she has managed to come up with to fulfil all my dreams. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 215 to 217 not moved.]
Schedule 3 agreed to.
Clauses 48 to 50 agreed to.
Schedule 4 [Amendments of enactments]:
Lord Harris of Haringey Lord Harris of Haringey moved Amendment No. 217A:
Page 62, leave out lines 22 and 23.
The noble Lord said: This is unashamedly a probing amendment. I expect that we shall be told later that it goes to the heart of the Bill in a deeply unhelpful way in that it deals with the question of the abolition of extra-contractual referrals. The amendment would mean that patients whose quality of life is at risk because of severe pain or loss of mobility or livelihood, would still have the option of being referred outside local service agreements between health authorities and trusts, and that trusts could be reimbursed for treating such patients.
Before the introduction of the internal market by the previous government, GPs were free to refer patients to any NHS consultant anywhere in the country. It was genuinely a National Health Service. The 1990 Act introduced a two-tier system. We were assured at the time that somehow that increased patient choice. The reality was that it restricted patient choice, because there was less of an opportunity for patients to discuss with their GPs the precise referral that would be most appropriate for their individual circumstances.
Under the present arrangements for 40 per cent. of the population GP referrals are restricted by a mechanism known as extra-contractual referrals. It is the mechanism by which trusts are reimbursed if they treat

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patients referred outside health authority contracts by non-fundholding GPs. The system has been extremely complicated, poorly explained, and often poorly funded. However, it meant that there was an appropriate mechanism which allowed many thousands of patients to receive timely and/or specifically appropriate treatment for their needs when they were faced with a rare or complicated illness.
My understanding of the Bill as currently drafted is that it proposes to replace extra-contractual referrals with a new system to be known as out of area treatments (OATS) by means of secondary legislation. It is clear from the Government's consultative paper, The new NHS: guidance on out of area treatment, that the new system will mean a dramatic reduction in informed choice for patients. That will clearly affect a number of groups of patients, particularly elderly people whose quality of life may be severely affected by pain and mobility, some of whom currently face waiting times of three-and-a-half years for admission to hospital for operations such as hip and knee replacement or cataract removal; or those patients whose lives are at risk because they are on long waiting lists; or patients who have good reason to want to be referred to a consultant or a centre which specialises in a rare or complicated illness not covered by the new specialised commissioning arrangements.
The purpose of the amendment is to examine how we can ensure that the needs of those patients are met, that there is flexibility and that we can perhaps return to a system where there is genuine patient choice exercised by dialogue and partnership between the GP and the individual patient concerned. I beg to move.
Baroness Hayman: I am grateful to my noble friend for the way in which he introduced the amendment, and for his recognition that, were it to be accepted, it would set in tablets of stone the current arrangements for extra-contractual referrals. I believe that he accepts that the current arrangements are not satisfactory and cause difficulties for patients, and I urge him not to press the amendment. In doing so, I am happy to explain in rather more detail the arrangements that we are putting in place to replace extra-contractual referrals.
Extra-contractual referrals were "one-off' arrangements whereby an NHS trust provided care for someone and that care was not covered by a contract with the patient's health authority. We made a clear commitment to abolish the internal market and to replace it with modern arrangements founded on the principles of co-operation and partnership.
In the ECR system, individual patients became the subject of sometimes heated debate between GPs, NHS trusts and health authorities about whether they were covered by a "contract" and, if not, whether their care would be paid for. Sadly, the focus was sometimes not on building high quality services for patients, which is our clear purpose, but rather on opportunity and "playing the market". The abolition of ECRs signals a clear end to the unnecessary anxiety for patients and the excessive bureaucracy that symbolised the internal market.
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The new arrangements for commissioning patient services will ensure that all referrals to hospitals are covered by either the new long-term service agreements or the new arrangements for access to specialist services. The new arrangements are intended to strike a balance between coherent planning for service development and responsiveness to individual needs.
Health authorities and their shadow PCGs, NHS trusts and clinicians, are already putting a great deal of effort into shaping plans for their local health service through the local health improvement programmes. It is our intention that long-term service agreements should be developed through dialogue between the clinicians concerned and with important input from users. More sensitive commissioning will ensure that the new arrangements will also be able to take account of the views of users.
New arrangements for planning and commissioning specialist services, which were often the cause of ECRs, are also being developed. Attempting to support complex services through funding from ad hoc ECRs was never the way to secure good quality patient services. That is why, in The new NHS, we charged the regional offices of the NHS Executive with ensuring that better arrangements are in place, based on clear, long-term service agreements for these services to which all concerned are committed. These are intended both to promote fair access for patients and to support clinical staff in developing the most suitable and effective care. Where there are consistent patterns of referrals to a service, whether a specialised service or more locally, it is right that that should be reflected through service agreements. It has already been possible to build some 90 per cent. of what were ECRs into service agreements for the future.
However, there are cases that do not fit that pattern—emergencies away from home, or a rare condition needing specialist treatment. Such cases will be covered by the new arrangements for out of area treatments. Where a hospital receives referrals of this sort, that pattern will be reflected in the allocation of the health authority which is its main commissioner, and that health authority will build this funding into its own service agreement with the hospital to cover these ad hoc cases. That will be achieved by directions.
OATs will be within service agreements but not constrained by them and the referring health authority will not be constrained by past spending patterns. OAT patients will be treated under the same agreement and on exactly the same basis as the main commissioner's other patients. They will be treated according to clinical priority and covered by the standards for quality and effectiveness specified in the main commissioners service agreement. Freedom to refer will be enhanced through OATs as prior approval will not be required as was the case with ECRs.
There will be no more quibbling as to whether or not patients are covered by "contracts", and no more chasing invoices around the system. The freedom of GPs to refer and the freedom of trust clinicians to admit according to clinical priority within the overall resources available to them are safeguarded.

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Allowing ECRs to continue, as the amendment proposes, would mean letting patients continue to be piggy-in-the-middle while health service managers argue about who will pay. I hope that the former provisions enabling ECRs to continue are now clearly redundant, and that my noble friend will feel reassured that we have in place better arrangements to replace them.
Lord Harris of Haringey: I am grateful to my noble friend for her reply. The statement that there will be no requirement for prior agreement before an out of area treatment is approved is extremely welcome, as is the expectation that there will be greater flexibility. I shall need to read with some care the precise mechanism that my noble friend describes. I am not sure that I fully understand how it would work for a patient sitting on the opposite side of the table to the GP who is making the referral. However, on the basis of the reassurances given, I am happy at this stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Harris of Haringey Lord Harris of Haringey moved Amendment No. 218:
Page 63, line 8, at end insert—
("( ) In section 15 (information and consultation)—

(a) for subsection (IA) there is substituted—

"(1A) Subsection (1B) applies where information has been obtained by a Commissioner or any of his officers in the course of or for the purposes of an investigation which is to the effect that a person is likely to constitute a threat to the health or safety of patients.", and

(b)in subsection (1B), omit the words following "patients".").

The noble Lord said: This amendment relates to a very different topic. It seeks to give the Health Service Commissioner (the ombudsman) greater discretion to pass directly to other bodies concerns arising from individual complaints to him where he judges that there may be a risk to the health or safety of patients.
The bodies to which he might pass on such concerns include the professional regulatory bodies which we have spent so much time this afternoon discussing, such as the General Medical Council, the General Dental Council, and the UK Central Council for Nursing, Midwifery and Health Visiting, as well as the future commission for health improvement which the Bill seeks to establish.
The Committee may be surprised to learn that the present wording of the Health Service Commissioners Act 1993 (as amended) severely restricts the circumstances in which the ombudsman may disclose, say to the General Medical Council, concerns arising from a complaint to him. He may, for example, not do so if he decides not to investigate the complaint which gave rise to the concern, or if the matter of concern falls to be disclosed in one of his reports. The result is that the ombudsman has less scope to bring concerns to the GMC or other such bodies than has a private citizen. My amendment seeks to put that right.
I do not believe that this amendment will change current government policy about the ombudsman's powers. However, it removes an undesirable effect—quite possibly an unintended effect—of the current wording of the legislation. The deficiency in the present legislation is not an academic point. Since 1996 the ombudsman has had powers to consider complaints about the exercise of clinical judgment. The ombudsman tells me that on several occasions he has had worries, arising from individual complaints to him, about the actions of individual doctors who were still practising. He wanted to tell the GMC about them as soon as possible, but had to resort to intermediaries to do so. Clearly, that cannot be right or sensible.
I trust that I do not need to labour the arguments to persuade the Committee that the amendment is in the interests of patients. I am motivated by my 12 years' experience as director of the Association of Community Health Councils. It is quite unacceptable for patients if the ombudsman is worried that their doctor might pose a risk to their health or safety, or indeed to other patients, but is not in a position to tell the GMC directly. I understand that recent sad cases underline that we cannot be complacent about the present situation. We must ensure that concerns can be acted upon speedily.
The ombudsman has sought my support in proposing this amendment, and I am glad to give it. He has also written on the matter to the Select Committee on Public Administration in another place and members of the committee have questioned government witnesses about it. The amendment also has the strong support of the current president of the General Medical Council, Sir Donald Irvine. I notice that the noble double act, the former presidents of the General Medical Council, is no longer here. Sir Donald Irvine has written to the ombudsman saying:
"I know that you see cases where the specific circumstances of the particular matters you are investigating cause you to have serious concerns about the general standard of a doctor's professional skills, knowledge or attitudes. It must be in the public interest for you to be able to draw those concerns to our attention, so that they can be properly investigated under our performance procedures".
A similar letter has been sent to the ombudsman by the president of the General Dental Council, saying:
"we would support the removal of harriers to appropriate exchange of information where the public is potentially at risk. Whilst clearly this is an area where proper thought must be given to appropriate safeguards, nevertheless, we would have no difficulty in your discretion in this area"—
that is the ombudsman's area-
"being less circumscribed".
The amendment concerns the safety of patients and is supported by the medical profession's regulatory body and by the dental profession's regulatory body. It gives wide discretion to the ombudsman, but I suppose that is what an ombudsman is for. I am confident that the Committee will agree that the public interest is best served by allowing the ombudsman the wider powers sought by the amendment. I beg to move.
7 p.m.
Baroness Hayman: My noble friend has raised a very important issue. The Government are aware that

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the existing statutory limitations on the Health Service Commissioner in the area that he has outlined have been a matter of grave concern to the commissioner for some time. I agree with him that it is entirely right and consistent with the wide aims of our proposals for reform of the National Health Service that if the commissioner obtains information which suggests that the health or safety of patients may be at risk, he should be able to pass that information on to the appropriate authorities. Therefore, I would certainly accept the principle behind my noble friend's amendment.
However, I should point out that the Health Service Commissioner is in a delicate position. Complainants, and others who may be called on to provide information to him, do so in the expectation that it will he kept confidential. For many that is a crucial element of the commissioner's work. Of course, the health and safety of patients must be paramount. But I am sure that the Committee would agree that we need to consider carefully the balance between giving the commissioner the very wide discretion which would result from my noble friend's amendment, and the need to maintain the confidence of complainants and those complained against. Indeed, we had a slightly tangential discussion about confidentiality issues and the need to be careful about them on an earlier amendment in Committee.
We need to ensure that we get the balance right. For those reasons I cannot accept the amendment as tabled. However, as I have said, we accept the principles behind my noble friend's proposals. I shall certainly undertake to give urgent consideration to whether we can use the opportunity offered by this Bill to effect the changes in the Health Service Commissioner's powers that he and my noble friend would wish to see.
Lord Harris of Haringey: I am grateful to the Minister for her reply. While I understand the point about individual confidentiality by complainants, there must be ways by which that can be circumscribed by very clear consent being given. We have to ensure that the public interest is protected in such cases.
Clearly, the ombudsman remains concerned about the limits to his powers to make referrals in appropriate cases. While I am delighted to hear that my noble friend intends to look at this urgently, I hope that it will be possible to bring forward an amendment, suitably worded, on Report. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedules 4 and 5 agreed to.
Clause 51 agreed to.
Clause 52 [Commencement]:
[Amendments Nos. 219 to 221 not moved.]
On Question, Whether Clause 52 shall stand part of the Bill?
The Earl of Mar and Kellie: In the absence of this group of amendments I want to ask about the constitutional position of the Bill vis-à-vis the Scottish Parliament. Next on the Order Paper is the Water Industry Bill which is a Bill that the Scottish Parliament
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does not have to take up if it does not wish to. Therefore, I want to ask approximately the same question. Will the Scottish Parliament have to accept the whole of the Bill or will it be devolved unenacted as regards Scotland?
Baroness Hayman: We have dealt in general terms with the inter-relationship with the Scottish Parliament for the provisions of this Bill. We have made it clear that the Scottish proposals respect the differences in Scottish traditions and experience. The argument has been made that any change in Scottish health legislation should be left to be dealt with by the Scottish Parliament, rather than being brought before this Chamber and another place. We have explained why the Government take that view on the items that are dealt with in this Bill. It is important that we take action so that progress can be completed on areas where we are clear that progress can be made.
Of course, on 1st July Scottish Ministers will take over responsibility for functions that do not relate to reserved matters, such as professional self-regulation, with which we have been dealing this afternoon. That includes the NHS in Scotland. The Scottish Parliament will assume legislative competence for those matters on the same date. The power to make commencement orders relating to the Scottish provisions in the Bill will automatically pass to Scottish Ministers on 1st July. Any commencement orders relating to the Scottish provisions before that date would be for UK Government Ministers.
I hope that answers some of the questions of the noble Earl. My noble friend Lord Macdonald of Tradeston will be happy to give more details at a further stage of consideration, when I expect there will be a debate on some of these issues.
Clause 52 agreed to.
Clauses 53 and 54 agreed to.
House resumed: Bill reported without amendment.

Water Industry Bill
7.10 p.m.
Lord Whitty: My Lords, I beg to move that the Bill be now read a second time.
I appreciate that we have reached this business later than we had intended and I hope it does no harm for me to thank the noble Baroness, Lady Miller, for her co-operation through the usual channels. I am afraid that matters have not worked out as we had thought, but we appreciate her co-operation nevertheless.
Although the Bill covers England, Wales and Scotland, the respective water industries operate in different ways. There are therefore separate provisions relating to England and Wales and to Scotland.
Immediately after the general election in 1997 we held a water summit and set out a 10-point action plan for a better water industry. Since then we, together with the water companies and the Office of Water Services, have made substantial progress in a number of key areas.

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A significant area of public concern in the water-charging field is the level of overall costs which fall on customers. It may be helpful, therefore, if I start by putting our proposals in the context of the current periodic review of water prices, which will set price limits to apply from April 2000 to 2005.
Since privatisation in 1989, customers have seen water bills in England and Wales rise by over a third in real terms. There have been significant improvements in water quality and the water environment in this time, but there is still some way to go.
We therefore want to see an ambitious programme of investment to protect our beaches and rivers, make further improvements to our drinking water and protect our precious nature conservation sites. But, at the same time, we want to ensure that hard-pressed customers are not faced with unreasonably high bills. We have given guidance to the Director-General of Water Services on the environmental and quality objectives to be achieved by the water industry in England and Wales. That involves an improvement programme, costed at between £8 billion and £8.5 billion, to be undertaken by 2005. The Director-General has confirmed that our programme could he afforded at the same time as substantial price cuts. We believe that this strikes the right balance between protecting and improving the environment and safeguarding the interests of the consumer.
The proposals before the House are designed to ensure that there is also in place a system of fair and affordable water charges, particularly for vulnerable customers, protecting public health while ensuring that water supplies are used in a sustainable way and protecting the aquatic habitat. The proposals are based on a consultation exercise carried out last year.
The Bill, as it relates to England and Wales, therefore has three key aims: The first is the prevention of disconnection for households and those providing certain vital community services. I think we would all agree that water is essential for life and health, and the Government do not believe that it can be right to deprive anyone of access to clean water because they cannot afford to pay a bill. The Bill will therefore prohibit the disconnection of people's homes and certain premises providing community services and is an important measure in protecting private and public health.
The Bill will also ensure that water companies cannot use other methods short of disconnection for depriving people of an adequate water supply in order to force them to pay a bill, such as devices which severely restrict the flow of water available to them.
The second objective is the protection of vulnerable groups. We are concerned to ensure that vulnerable groups with high essential water use are not faced with hardship when they move into a home with a water meter. So that we can ensure that this does not occur, the Bill contains a power for the Secretary of State to make regulations about the bases of charging that must be offered to certain customers. We intend to use this power to ensure that large families with low incomes and people with medical conditions requiring high water
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use who live in a home with a water meter are offered a bill based on average measured use rather than on their own unavoidably high use.
The third objective is promoting customer choice. At present most people—around 86 per cent. across the country—pay for their water on the basis of an unmeasured charge, usually referring to rateable value. That will continue to be the dominant form of charging for many years to come. The number of metered households is increasing steadily, however, by around 3 per cent. a year. There is an important role for measured charges to play in our water-charging system. Those paying on this basis tend to conserve water and to be more aware of the value of the resource they are using. At the same time, many customers do not wish to pay on that basis and could find their bills significantly increased were they forced to do so. Others, who would prefer to pay on the basis of a meter, find that the water company has hitherto charged up to £250 in up-front installation charges. The situation varies widely across the country, depending on the policies of the water company involved.
The Bill will put charging arrangements across the country on an even footing. It will ensure that customer choice plays a central role in the water-charging system, rather than being a footnote to it. It will give customers new rights to remain on an unmeasured basis of charging in their current home where they are using water for normal household purposes only or to pay for their water on a measured basis. To make this a real right, the Bill also ensures that companies will no longer be able to charge for the installation of a meter. So that there continues to be a basis for unmeasured charging, the Bill removes the deadline of 31st March next year for the use of rateable value in water charging.
Part I of the Bill relating to England and Wales delivers our commitment to introduce a system which provides for fair and affordable water charges, particularly for vulnerable customers, while ensuring the sustainable use of water supplies and protection of the aquatic environment.
I turn now to the Scottish provisions in Part II of the Bill, which deals with arrangements for regulating Scotland's three publicly-owned water authorities. It provides for improvement to the regulatory system by creating a water industry commissioner for Scotland who will replace the Scottish Water and Sewerage Customers Council. It will give the commissioner the general function of promoting the interests of water customers and the particular function of advising Ministers about water charges, and will create three water industry consultative committees to support the commissioner.
The need for a better system was identified in the review of the Scottish water industry carried out by the Scottish Office in 1997. That review found a consensus that the arrangements in place for regulating the water authorities had proved untenable. This reflected concern in particular about the current division of responsibility for economic regulation between the customers council and the Scottish Office. It recommended that a new professional regulator should be responsible for all

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aspects of economic regulation and for promoting the interests of water customers. The Bill provides for the commissioner to take on those roles.
In effect, the commissioner will therefore take over most of the existing duties of the customers' council and assume the duty of advising Scottish Ministers on water charges. He will not be a civil servant but will operate independently of government within a framework of accountability to Scottish Ministers and, through them, to the Scottish Parliament.
The Bill also establishes water industry consultative committees for each water authority. They will advise the commissioner on the customer-service performance of their respective authorities and on other issues of concern.
To the devolution question raised by the noble Earl, Lord Mar and Kellie, in relation to the previous business, by legislating now the Government are ensuring that the new Scottish Ministers will have the opportunity, should they wish it, to introduce quickly a regulatory system that is markedly better than the one in place at present. However, they will not be bound to do so. The decision to implement the legislation will be entirely a matter for them. Given the broad support that exists for the policy in Scotland, we are confident that they will wish to do so.
The provisions of this part of the Bill will greatly improve the regulation of the water industry in Scotland in the interests of all its customers and by achieving the other objectives I have outlined. I believe that the provisions of Part I will do the same for England and Wales. I commend the Bill to the House.
Moved, That the Bill he now read a second time.—(Lord Whittv.)
7.19 p.m.
Lord Elliott of Morpeth: My Lords, I am grateful to the Minister for having succinctly outlined the proposals in the Bill. I should like to make some comments on the effects on the proposed legislation in England and Wales. First, I comment on the noble Lord's explanation about the disconnection powers for non-payment. I declare an interest. For 10 years I was chairman of a water company and for 14 years I was president of the Water Companies Association. Therefore, I know quite a bit about cut-offs. I assure the Minister that the water companies that I knew—and I knew them well—used the power of cut-off only as a very last resort. I am aware that in the past water companies have been heavily criticised for cutting off supply.
Those who did not pay their bills fell into three categories: first, those who believed that as water came from heaven it should not cost anything at all; secondly, those who would pay for anything only as a last resort; and, thirdly, those referred to by the noble Lord, the most vulnerable, who were on low incomes and for whom payment for water was very low on their list of priorities. As chairman of a water company, I had some very peculiar experiences. A farmer who lived close to me in the countryside telephoned me on one occasion. Having tried everything else he thought that he would contact the chairman. He accused me of being cruel to
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his animals. He then took his telephone to the window and opened it so that I could hear the bellowing of his dairy cows. I asked him how much he owed the company and his response was, "Just £57". He was by no means a small farmer. I told him what to do. I said that he should go the nearest branch office—I told him where it was—pay the bill, the water would be turned on immediately and he could get on with his milking. There were quite a number of people like that. However, I agree with the Minister in respect of those who fall into the vulnerable category.
Most companies had a number of flexible schemes. We cut off supply only as a very last resort. For example, there was a direct payment scheme administered by the DSS. That scheme allowed customers to pay directly from income support payments. I hope that might be amended to give water a higher priority. When one looks at the whole political and commercial scene, water is always well down the list.
Looking back to my days as chairman, I also recall great difficulty in recovering debts from properties in the rental sector, in particular in the city as opposed to the countryside. There are a lot of rented properties in cities. There must he a very strong case for placing responsibility for water payments upon the landlord, particularly in catchment areas where there is a university. It was quite remarkable to note how many students who were responsible for water charges under agreements with landlords simply left and we had no means of pursuing them. This is a very important point. It would be most helpful if landlords were made responsible for water charges for lettings of 12 months or less.
The right to cut off supply did work. In certain cases where there was a determined intention not to pay, that power could be very effective. The proposals in the Bill concerned with cut-off may well be seen as a charter for non-payment, which will be a great difficulty.
I comment briefly on Clauses 4 and 5. At present Ofwat advises on charges. Under the Bill in future companies' charges will be modified in response to regulations set out by the Secretary of State. That is a major, and somewhat dangerous, change in the way that the industry is regulated. I hope that before the regulations come into being they will be very carefully considered and will be made subject to advice from people and bodies with experience of the industry.
I turn to Clauses 6 and 7. There has been an enormous amount of discussion on metering over the years. In most areas all new properties are automatically fitted with meters. The company for which I was responsible fitted meters in older properties on request. Metering in certain areas can aid conservation of supply. In the north east of England, where I come from, there is no shortage of supply. Therefore, I warmly welcome the proposal in the Bill to continue to charge on the basis of rateable value. Universal metering has always been an extremely expensive proposition. Therefore, it is very sensible to use rateable value as a means of fixing charges.
Finally, in Clause 8 there is a proposal to extend the use of the rateable value of properties to assist in calculating charges. That is most sensible. As I recall,

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information about rateable value is available to companies for particular properties but access to council tax data would be most helpful. The availability of rating bands would very much assist in providing flexibility in charging. Those are the only comments that I make on the Bill and I look forward to taking part in the further stages.
7.27 p.m.
Baroness Young of Old Scone: My Lords, I declare an interest as chairman of English Nature and a non-executive director of Anglian Water. Water resources in this country are coming under increasing pressure. Demand is going up. With another 4.4 million houses and climate change demand will increase further. Climate change will also have an impact on supplies. We already see the impact on our wetlands. Over 50 SSSIs and 60 other nature conservation sites are threatened by water abstraction. The Environment Agency has done some work which shows that by 2021 the gap between availability and demand for water will total about 4,000 megalitres per day. For those whose eye immediately passes over any figure that has three noughts and is expressed in megalitres, that is a lot of water. Two-thirds of the gap between supply and demand can be closed by leakage control. However, one-third needs to be met by managing domestic demand in particular. It is necessary to have a package of measures that includes not just leakage reduction programmes but two other matters: educating customers to save water and giving them incentives to save water.
At this point I heap obsequious praise on the Government, particularly the Deputy Prime Minister and the Minister for the Environment, Michael Meacher. I believe that great progress has been made by way of the Water Summit, work on leakage control, the huge programme of investment that has been announced as part of the water price round and the work that is currently going on in the abstraction review. But action on educational programmes for demand management and incentives for water saving is very slow. The Water Industry Bill could provide an opportunity for the Government to deliver an incentive for water efficiency by encouraging payment by volume. However, the Bill before us is not necessarily an initiative for which I heap praise on the Government. The Bill misses an opportunity to tackle the environmental issues I have outlined.
The Minister pointed out that the Bill has three key aims: preventing household and community service disconnections; protecting vulnerable groups; and promoting increased consumer choice. The first two social objectives are vital and I support them entirely, but they are not enough. The Government are committed to the principle of sustainable development and to achieving economic, social and environmental objectives through the same policies by integrating all three key objectives. However, if we are in earnest about incentives to save water, increasing consumer choice makes current metering policy somewhat flabbier and it is unnecessary as other provisions in the Bill protect vulnerable households.
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Water metering is a key tool in reducing the demand for water. However, "metering" seems to be a dirty word in some quarters. I assert that metering is not intrinsically bad; it can reduce environmental pressures and help to save consumers' money by reducing the economic costs of building more reservoirs. The only bad aspect of metering is that it places unacceptably high costs on low income families or those who use large quantities for medical reasons.
Apart from promoting the social objectives outlined, the Bill, if it took on board three elements, could also produce an environmentally effective metering strategy. First, it could target metering to areas where there is water stress, where demand outstrips supply, which is not the whole country, as pointed out by the noble Lord, Lord Elliott. The Bill already allows companies to meter on a compulsory basis consumers with high non-essential demands, such as people who use water for swimming pools and garden sprinklers. That could be extended to allow water companies compulsorily to meter customers who live in areas of high water stress without necessarily impinging on the vulnerable households who are protected by the other measures in the Bill.
The Bill could also promote water efficiency measures. Water companies already have a duty to promote the efficient use of water among their customers. Some do so in a rather cursory way by sending out leaflets; others have active and well-thought-through programmes. We need measures which encourage those more effective programmes to be spread more widely. The Bill could do that if it required water companies to set targets for the impact of their water efficiency programmes on actual water savings.
Perhaps most importantly, the Bill could encourage innovative tariff design. In the majority of companies, tariffs hinder voluntary water metering as about 65 per cent. of vulnerable households would be worse off if they switched to a meter under present circumstances. However, some companies have done excellent work in developing innovative tariffs which mean that metering can both benefit the majority of vulnerable households financially and encourage water efficiency by as much as 20 per cent.
The Bill gives stronger powers to the water regulator in approving tariffs but in doing so it gives no incentives to water companies to develop the more innovative tariffs. Alas, the regulator is an economic regulator of the water industry and in approving charging schemes is likely to consider only how they meet economic objectives. I am afraid that the water regulator's track record on innovative tariffing is not good, so the guidance given by Ministers to the regulator is crucial. That guidance needs to ensure that the regulator takes account of social and environmental objectives as well as economic ones as part of joined up sustainable development thinking. It might also be appropriate to give companies performance grades in tariff innovation in the same way as they are assessed for performance in other ways.
I conclude with two other issues raised by the Bill. The first is the issue of switching back. Customers who opt for metering can switch back within 12 months.

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There are also provisions for what may happen when premises change occupancy. If the period within which switching back is allowed were to be extended, as was pressed in another place, we would have to ask serious questions about a real commitment to metering, conservation and the environment. Apart from the missed environmental opportunity which would be represented by that, it would also be extremely wasteful if meters were installed and not used.
The importance of the regulations and guidance which the Bill allows the Secretary of State to make is fundamental. There will be guidance on vulnerable households and on tariffing for environmental outcome. I believe that if we are to avoid the dead hand of economic regulation, we need wide consultation with social and environmental groups about the regulations.
During the past 18 months, the Government have demonstrated a clear commitment to addressing environmental impacts on water resources. The Bill is vital in its social provisions to protect vulnerable households. It would be a real shame if we could not have the modest changes which would make it right for the environment too.
7.35 p.m.
Lord Addington: My Lords, the noble Baroness, Lady Young of Old Scone, addressed many of the environmental issues that I noted when reading the Bill. Whether we on these Benches would go so far as she suggests is another matter, but we share certain of her concerns.
I was first attracted to the social factors in the Bill. The Government can take some credit for ensuring that those vulnerable people who need extra water because of a disability—for instance, someone who has lost control of his bladder and bowel or who regurgitates food more often than is to be desired—will find the Bill of great benefit, provided that the regulations allowed for are sufficiently supported. Such people use four or five times more water simply by having to use the washing machine several times a day. Unfortunately, washing machines are not the most efficient conservers of water, especially if they are dealing with unpleasant matter which cannot be washed away quickly. If someone has discharged his bowel, he cannot wash the affected clothes with others. They must be washed separately, at higher temperatures and for longer. Such people need support and I hope that the Government will press ahead with these measures.
As regards the non-disconnection of all water facilities, it is the basis of all good public health. Everyone knows that a clean water supply saves far more lives than any amount of money spent on the health service. The best way of ensuring good public health is to have a clean water supply. If small groups in society are denied that, diseases and general ill-health will he given a tremendous foothold. If someone cannot use a lavatory and has to get rid of human waste by throwing it out of a window, as has happened in certain tower blocks, that will create a public health hazard of phenomenal proportions. As regards that, the Government have acted correctly.
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However, I do not like metering because no matter how one looks at it and no matter how much money is put into education, the poorest will pay more as a percentage of income. That cannot be avoided. Unless that problem is addressed, those with the least disposable income will be forced to use water only as a necessity. I hope that everything that has been said today reinforces that point. If the Government press on with metering, the second most fundamental necessity for existence—water, after air—will cost money from the consumers' pockets. I suggest that the Government introduce a flat rate charge based on council tax bands, which is a fairer way of progressing with water reforms.
The noble Baroness, Lady Young of Old Scone, mentioned meters for swimming pools. Of course, an enhanced flat rate charge could have been introduced for such users. I believe that if we go down the path of metering, the poorest will always be hit first and that is not something we would want to encourage.
7.40 p.m.
The Earl of Mar and Kellie: My Lords, my noble friend Lord Addington mentioned the end of disconnection. I am extremely glad to hear that England and Wales propose to catch up with Scotland in that respect.
The Bill has limited implications for Scotland. Those are, of course, contained in Part II. The Bill sets out on the intriguing road to the establishment of a public sector regulator for a public sector industry. It proposes to amalgamate the task of consumer representation with that of economic regulation.
It is certainly right that the water industry in Scotland should be legislated for totally independently of the other constituent parts of the United Kingdom. It is an important part of the Scottish political psyche that the provision of clean water and the effective treatment of sewage should be a public sector activity. It is also important that the industry's three monopoly public sector businesses should operate efficiently and observe the highest standards of production, service delivery and environmental protection. In other words, the industry must deliver in a sustainable manner.
The Bill intends to abolish the Scottish Water and Sewerage Customers Council. I say "intends" because the Act will only be implemented if the Scottish Parliament chooses to do so. So, in this transitional period, we have the interesting constitutional situation of legislating hopefully rather than definitely.
In place of the customer council will be a commissioner and three water industry consultative committees, one for each of the three water authorities. I should declare a current interest as a customer of the East of Scotland Water and Sewerage Authority and the anecdotal interest that my family enabled the public supply of water to the town of Alloa in 1802 from the Gartmorn Dam, the first reservoir in Scotland dating from 1713. The much-applauded city fathers of Glasgow and their 150 year-old Loch Katrine scheme can always benefit from advice, guidance and example from Clackmannanshire!

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The commissioner—if the Scottish Parliament likes the idea—will combine the roles of customers' watchdog and industrial regulator. That has caused concern to the Scottish Consumers Council. It feels—I will go along with it in this—that the range of considerations will be too wide for any one office, and that consumers' concerns may be submerged in the welter of undoubtedly heavy-duty, industrial, environmental and economic issues. I suspect that they have a point.
Also, exacerbating the situation somewhat, will be the commissioner's role in the appointment of all the members of the three water industry consultative committees. No doubt that will be done in accordance with the current rules about public appointments, but my own concern is about issues surrounding re-appointment. Will the system seek to retain outspoken members or discriminate against them? In such a vital industry as water, the councils will need to be seen to be robust defenders of consumers' interests. There is a worry that the commissioner's statutory duty to chair each of the three councils or consultative committees will be symbolic of the downgrading of the consumer protection role. A way out of that perceptual and possible issue might be the overt appointment of three distinctly consumer-orientated deputy chairmen.
My noble friends are generally in favour of returning the water industry to local democratic control in Scotland. The Bill retains control at central government level and then devolves it. I do not seek to have 32 water and sewerage authorities in Scotland. I am reasonably content with the regional approach which is being retained. After all, substantial economy of scale issues are involved and the industry is having to face up to expensive renewals of the pipework infrastructure. Anyone travelling through Alloa recently will be aware of the traffic jams caused by the renewal of the water mains.
The issue of democratic control is quite significant. I do not see this Union Parliament as being capable of supplying real democratic scrutiny and accountability to the three Scottish authorities, on the grounds that all the Scottish representatives with real grievances to be dealt with can be overruled by the superior numbers of those from elsewhere who cannot have those grievances because they do not live within the jurisdiction. I am, however, content that the Scottish Executive could be held to account because all the representatives are personally and officially involved in the industry.
There is, of course, an alternative model of local democratic control, by means of joint boards. I believe that they would be rather unwieldy, with between eight and 12 local authorities involved. Your Lordships will be pleased to know that I do not support their creation. However, I should like to praise the work of the old joint board made up of Perth County Council, Clackmannan County Council and Grangemouth Large Burgh, which successfully organised the Loch Turret scheme in the 1950s.
I am concerned about the position of the commissioner vis-à-vis the Secretary of State and subsequently the First Minister. Although I can go along
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with the transparency laid down in the Bill whereby the advice given by the commissioner will be published—as will the response of the Secretary of State or First Minister to that advice—I am concerned about the position of the commissioner if the Secretary of State decides to reject the advice. Will that not become resignation time for the commissioner? Will the position of the commissioner be sustainable in such circumstances?
In the final analysis, we need to focus on outcomes rather than organisational structures. The Scottish public need to know that these legislative changes will make a useful difference and improvement to the delivery of water and sewerage services. A few citizens in remote areas of Scotland are not consumers of the three authorities. However, the vast majority are totally dependent upon the three authorities for these vital public health measures. The public need to know that there is effective supervision of the industry which supplies their water and sewerage and that those who govern the industry are motivated by the highest standards of public service taking into account the wide-ranging criteria upon which they must be judged.
7.47 p.m.
Lord Ahmed: I congratulate the Government on delivering its manifesto commitment by ensuring that the water companies improve service, tackle leakage and reduce prices.
The Minister stated that since privatisation in 1989, water bills in England and Wales have risen by more than a third in real terms. Since 1990–91, total profits have risen from £1.3 billion to over £2 billion at current prices. Although some improvements have been made, I believe that significant improvements need to be made in re-investment into the infrastructure, quality of water and water environmental schemes. We need to protect and improve our environment.
Like other noble Lords, I am pleased that the Bill gives new rights to the consumer relating to disconnection. I am particularly pleased that the Bill will remove the powers of the water companies to disconnect, for non-payment of bills, the supply of water to private dwelling-houses and houses in multiple occupation. It also protects vulnerable persons such as children, and nursing and residential care homes. Another important issue relates to the option that rateable value should continue to be used as the basis for unmeasured charges after 31st March 2000.
I should like to draw the attention of my noble friend the Minister to Yorkshire Water's policy of installing water meters in places of worship. My noble friend Lady Young of Old Scone said earlier that "metering" is a dirty word. It certainly is in the faith communities. That policy of installing water meters in places of worship is causing hardship to those communities.
I should like the Government to consider the exemption of all places of worship from water meter installation and to enable places of worship that have had meters installed to have them removed and to revert to being charged according to rateable value or on some token standing charge.

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I have had representations from many mosques and Sikh temples. As your Lordships are aware, both the Moslem and Sikh faiths require the use of water in their rituals. Moslems are required to perform ablution and Sikhs are required to cook food for their community. It is not possible to worship properly as a Moslem or a Sikh without the use of water. That means that the high cost of metered water is unavoidable for temples and mosques.
This morning I received a faxed letter from two Kirklees councillors, Councillors Annie Smith and Mahboob Khan. Both stated that Birkby Ward in Huddersfield has three mosques and one Sikh temple. The temple and one of the mosques have had water meters installed. They did not ask for the meters to be installed; they were told that the water company had the power to instal them and that they could not stop it. The mosque installed water-saving devices, but still gets water bills totalling more than £1,000 a year while the Sikh temple's bills are £1,000 a quarter.
Birkby Ward has seven churches. They have not been targeted by the water company, but some have chosen to have water meters. The Christian faith does not require large quantities of water in its worship, so water provision is not an issue. Both councillors have pointed out that their community is not rich and therefore cannot afford the extra expense. I know that other communities throughout Britain have expressed similar views: that they cannot afford these charges in their mosques and temples.
Finally, I welcome the Bill in principle, with the request that the Government include exemption from water meters for all places of worship.
7.52 p.m.
Baroness Hamwee: My Lords, I too thank the Minister for his introduction of the Bill. When I heard that we were to have a Bill on this topic, I thought for a while that it would be a DTI Bill, especially as this Bill rather leaves the needs of the environment to one side. Indeed, perhaps the Bill reads rather more like a DTI Bill than a Bill from the DETR.
I have referred to "reading" the Bill as I should like to make a particular point and to say how helpful it has been to have the Explanatory Notes published alongside the Bill, given the large number of amendments that the measure proposes to make to earlier legislation. The notes set out the provisions in the form in which they will be amended although I find it a little curious that they are accompanied by a health warning about their authority. Nevertheless, we have had the benefit of the notes and I hope that the style that we use in our legislation may advance to the point where we have schedules to the legislation setting out the new provisions in a similarly helpful way.
Turning to the detail of the Bill, as has been said the issue of water raises very many different concerns. It is not just about what comes out of the tap; it is also about what goes down the drains, where it comes from, and where it is abstracted. My noble friend Lord Addington referred to water's obvious relevance to health. Calling water a "utility" perhaps fails to address the fact that water is more than just useful; it is essential.
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The Bill addresses some social and economic issues rather than environmental matters. Being naturally more diffident than the noble Baroness, Lady Young of Old Scone, I shall not repeat her "obsequious praise" of the Government with regard to leakages. However, the House may find it helpful if the Minister can tell us what progress has been made in reducing leakages. I understand that the target was a 20 per cent. reduction by May of this year. As has been said, we cannot expect users of water to control their use when they know that so much is literally seeping away. If the Minister can give any news on progress in that regard, it would be welcome.
The Bill—at any rate, a Bill—is obviously needed; otherwise there would be no basis on which to charge non-metered customers in a year's time. That is why I turn first to Clause 8 although it is the shortest clause and buried precisely halfway through the Bill. Indeed, although it does not cover any of the objectives identified by the Minister in his opening speech, it is obviously a most important provision.
I know that the Government recognise the problem of using rateable values as a basis for charging. We on these Benches take the view that it would be appropriate to base charging on council tax bands. I am aware that the Minister in another place addressed that point at various stages of the Bill's progress. At Second Reading, the Minister said:
"there is no firm evidence that a system that relates charges to council tax bands is inherently or automatically related more closely to consumption or the ability to pay than a system based on rateable values".—[Official Report,> Commons, 7/12/98; col. 47.]
That raises many questions about the council tax itself. We agree that it is too far removed from ability to pay. However, although I recognise that issues relating to council tax benefit are not for now, there is a benefit scheme which applies to council tax and it seems to me that there is no reason why there cannot be a similar scheme for water to benefit those who are the most vulnerable or who find it hardest to pay. That could apply whether the basis for charging was the council tax or metering. On that occasion, the Minister referred to council tax bands. In the case of single-person households, the actual amount of council tax payable reflects the demand for services which are paid for in part by the council tax. We take issue with the Government in this area.
The point for now is that the Government say that it is for the water industry to find new methods of charging. We support work within the industry on that. However, for that the industry needs information and it needs it in an appropriate format. I understand that it is possible to ascertain the council tax banding of an individual property but only on an individual basis. In other words, to find out the banding of 10, 100 or 1.000 properties would require 10, 100 or 1,000 individual inquiries. If the Government can assist the industry and enable it to make progress in that area, that would be welcome.
Accepting that much of the thrust of the Bill and its context is about metering, I suspect that we shall need to spend a little time in Committee looking at how the provisions will operate, including the obligation on

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water companies to publicise free meters perhaps, and issues concerning the reversal of metering. I share some of the concerns expressed about what the noble Baroness referred to as "switch back." I also wonder whether 12 months is a sufficiently long period to enable customers to assess the position. I share the deep concerns about customers likely to switch back probably being those whom the industry would least want to do so.
I agree with the point made about the importance of dealing first and most importantly with areas where water is in short supply. Within each water company's area I should like the companies to have greater discretion than the Bill may allow in organising the provision of meters. It seems to me a very expensive proposition to require them to respond to the measured charges notices which customers can give in the way that is proposed.
In preparing for today I have been impressed by the suppliers' acceptance of the principle of the Bill and their real concern that the practicalities may not have been taken into account. We welcome precluding disconnections. As regards the enforcement of payment and the groups referred to by the noble Lord, Lord Elliott of Morpeth, but not those who cannot afford to pay, it seems odd that the direct payment scheme, which I understand is in force, puts payment some way down the list below payment for television licences. I should have thought water should be at least equal with other utilities. As the noble Lord, Lord Elliott of Morpeth, said, there are issues concerning landlords' liability as well. I hope that we shall return to them in Committee.
As regards charging fees for disadvantaged people, while welcoming the principle I hope that the Government will insist on very wide consultation on the regulations. It was the water companies themselves who made the point to me that health and social justice groups need to be included in the consultation.
Of course, we are concerned about affordability for everyone. We do not want to see water made difficult to afford for those outside the particular categories which will attract special assistance. There are widespread concerns about near universal metering because of the vulnerable groups. One might say that it is cynical not to believe that vulnerable people would not be protected if there were universal metering. I fear that it is experience over the years of our society failing to give that protection that gives rise to that concern.
I was most struck by the comments made by the noble Lord, Lord Ahmed, who appears to have left his seat. He spoke about mosques and temples. It is an important point. I say for the record that I hope he will table some amendments to enable us to explore those issues to a greater extent in Committee.
My noble friend Lord Mar and Kellie dealt with Scotland. I appreciate that there has been consultation there and that the provisions reflect that. But so close to the inception of the Scottish Parliament, it seems a little odd and possibly even a little arrogant to be legislating to allow the Scottish Parliament to take up what we in London are proposing. I rather liked his concept of legislating hopefully.
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Finally, we shall welcome something on the statute book which is very much like this Bill. I hope that the Government will not resist some adjustments to it. Not in this Bill, but at another time, we would welcome more environmentally based focus on how best to deal with this important resource.
8.3 p.m.
Baroness Miller of Hendon: My Lords, I, too, am grateful to the Minister for the clear and concise way in which he introduced this Bill. Every Member of your Lordships' House is a user of water supplies and has to decide, if he or she has not done so already, whether or not those supplies should be metered. In my own case my husband and I have had alternative conflicting decisions to make. We are fortunate enough to own a second home, used for holidays, where a metered supply was an obvious choice on economic grounds.
Similarly, in our London home, with four adults taking baths or showers every day; with washing machines, dishwashers and the numerous visitors coming to the house, one way or another we use such a lot of water that the flat charge based on rateable value appeared to us at the time to be better, although that will shortly change when we complete the installation of an irrigation system in our garden.
I did not intend to bore your Lordships with details of my domestic arrangements, but I wanted to point out that of the 30 million or so households there are many differing factors affecting what is best for them as regards their water bills. For that reason we congratulate the Government that the choice of metered supply or a flat rate charge should be continued by this Bill. That was our view. Indeed, the Conservative Party does not oppose this Bill in general principle because it is very similar to the one we would have introduced ourselves. We have some concerns over some of the details.
For example, Clause 9 provides that consumers in private dwelling houses who elect to pay for water by volume are entitled to have the meter installed free of charge. However, Clause 6(3) allows the company to refuse to install a meter if it would involve the supplier with what is called an "unreasonable cost". I ask the Minister how a genuine "unreasonable cost" will be ascertained. If it is not properly monitored, might there not be more cases like that of Mr. Paul Slawson-Price whose water bill, on moving from Kensington where he had a metered supply, to Chelsea where the water company refused to instal a meter on the ground of cost, jumped from £120 to over £1,055.
When the Bill was first introduced in the other place we were also concerned with the provisions against disconnection in Clause 1. The Government had produced a very large sledgehammer to crack a very small nut. In the end, the arbitrary list of exemptions was insufficient. In other words, the sledgehammer—if there had to be one—was itself too small. I am now pleased to congratulate the Government on having listened to the voice of reason despite their earlier reservations and have extended the list of exemptions, now set out in Schedule 1, to cover all of the cases that we argued for.

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Let me make it unequivocally clear that we do not lack sympathy for those whose supply is disconnected because they cannot pay as distinct from those who simply will not pay or who usually, for reasons of carelessness or neglect, do not pay on time. But the fact is that these restrictions on disconnection are in a sense still cosmetic because it transpired from the debates in the other place that the total number of disconnections in the first half of 1998 numbered a mere 640 out of 30 million households.
Without going into the details extracted, perhaps appropriately in a Bill about water supply, drip by drip, by my honourable friends in the other place, it seems that all but 264 were reconnected between a day and a week. Some of the 264 were clearly empty houses and second homes. But the number, 640, was a decrease on the last full year of 1997–98. It is a stunning decrease on the figures for the last year in public ownership and compliance with Treasury controls. That year was 1988–89 when the figure was 15,255.
I remember during the power cuts in 1973–74, occasioned by the miners' strikes, coming to the conclusion that, faced with the choice of having the electricity or the water supply cut off, there was simply no contest. There is always a way to cope without electricity, but no way to manage without the most important symbol of a civilised society; namely, running water and a proper sewerage system.
There is no doubt that some of those 640 disconnections were major personal traumas to those involved. I do not detract from the problems of those who find it difficult to pay. There are processes in place to minimise that problem and to help those involved. I hope that the water industry will continue voluntarily to seek and to encourage ways to alleviate by such methods as prepayment and pay-as-you-go, monthly instead of half-yearly bills, and through the charitable trusts which have been set up by some of the water companies.
The Bill prevents the disconnection of customers who do not pay and some vulnerable groups must be protected. But that should not be regarded as a licence to others to default. It is unfair that the majority of customers who do pay should subsidise those who do not; not because they cannot do so, but because they will not do so. My noble friend Lord Elliot explained that very well. The Government must ensure that water companies are not hit by a new crop of bad debts which will inevitably be passed on to the honest customers. I hope the Minister will consider that matter carefully.
I should now like to turn to another topic. It is a small matter, another anomaly in fact which we hope the Government will agree to correct at the next stage. Under Clause 6, as I have already pointed out, the customer has the right to elect to have a metered supply, and then under subsection (5), to change his mind within 12 months and revert to being charged according to the rateable value. My honourable friend, the Member for Chelmsford West, asked,
"if a household installs a meter and then moves to another home after 12 months, will the new owner have the option of reverting to the rateable value system?".—[Official Report, Commons, 7/12/98; col. 59.]
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The Minister for the Environment said that he would not. That is fair enough; caveat emptor.
It is at this point that I must declare a small personal interest. I am part owner of two rented residential properties and a shareholder in a family investment group which owns another two. I play absolutely no part in the day-to-day management of those properties. However, I have to ask what is the position of the landlord of a rented house or flat where the tenant opts for a meter? By Clause 11 of the Bill, a landlord is not entitled to prohibit his tenant from opting for a meter. But if the tenant stays for more than 12 months, then it would seem that the landlord is committed for ever. That cannot be right.
I am only talking about short tenancies, not long leases. If the landlord cannot prevent the exercise of the option, then he ought to have the right to cancel the meter within a reasonable time after recovering possession. The same period of 12 months would be fair, but I am open to any reasonable counter offer. I hope that the Minister will tell us in his reply that the Government will give serious consideration to that matter.
Finally, at this stage I must express some puzzlement at an apparent contradiction between Clauses 4 and 5. Under Clause 4 the Secretary of State may give what is called "guidance" to the Director of Ofwat. We all know what guidance means when it is given by the person who has your job in his hands. However, Clause 5 gives the Secretary of State power to make regulations which effectively control the charging regime of the water industry. If the Secretary of State wants to take charge of the water industry, why do we need the director and indeed the whole paraphernalia of Ofwat, except to be there to be shot at, instead of the Secretary of State if something goes wrong. I hope that the Minister will be able to clarify this in his reply; otherwise we can explore the matter further at a later stage.
If I may, I should like to mention the second part of the Bill which relates to Scotland. My noble and learned friend Lord Mackay of Drumadoon and my noble friend Lord Mackay of Ardbrecknish expressed surprise to me that there is any Scottish content in this Bill, given that water is about to be devolved to the Scottish Parliament. Any changes in the way the water industry is run in Scotland should be left to that parliament.
In Scotland the Government propose to bring closer together economic regulation and consumer interest. The new water industry commissioner will combine the functions of economic regulation with that of consumer representation. The current area committees are to be replaced by three consultative committees with a reduced number of members and chaired by the water industry commissioner. That does not seem to us to be wise; indeed, I believe that concern is shared also by the noble Earl, Lord Mar and Kellie. My two colleagues will be tabling amendments to keep the two roles separate. They will be looking at ways to strengthen consumer interests in representing the domestic consumer both to the water authorities and to the regulator.

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I do not propose to take up any more of your Lordships' time. As I said, in principle we support the aims of the Bill and any amendments that we find it necessary to table will be entirely non-partisan and constructive. We hope that the Government will treat them as such.
8.14 p.m.
Lord Whitty: My Lords, this has been an interesting debate covering a wide range of issues and one in which a number of differing opinions have been expressed. I shall try to deal with them.
I agree that the Bill is relatively straightforward and does not of itself tackle all the issues referred to today. I agree with my noble friend Lord Ahmed and others that a substantial amount still needs to be done on other fronts. But I take issue with the noble Baroness, Lady Hamwee. She may be looking for the whole of our environmental programme in this Bill, but that is not what the Bill is about.
The Government have demonstrated their commitment to a whole range of issues dealing with environmental matters. For example, in the measures to tackle leakage, to which the noble Baroness referred, it is true that progress has been patchy and pressure will continue to be placed on companies to deliver over the coming years the targets that we set at the water summit on leakage. But, with the water companies, we are encouraging an £8 billion programme to improve the environment. That is through the guidance we have given and the periodic review that we undertake of the water services, covering issues like significant sewage discharges which should all receive secondary level treatment; and covering improvement of unsatisfactory sewer overflows, improvement in river quality objectives, reaching the standards of the EC drinking water directive and dealing with adverse effects on habitats, and so forth. A whole new strategy on the environment lies behind our total approach to water policy.
However, this Bill has more limited objectives which are not incompatible, and in some ways support, those environmental objectives. Perhaps I may deal with those points legitimately raised within the Bill and put them within a wider context. The first issue concerned disconnection. I understand what the noble Lord, Lord Elliot, says about the problems of collecting money from those who abuse the system. As the noble Baroness, Lady Miller, said, it is true that under public ownership there were 15,000 disconnections. That actually rose in the first year of privatisation to 20,000, but has come down sharply over the past two years. Last year the total number was less than 2,000.
It is clear that water companies—this is what they tell us—have made great progress in finding other ways of pursuing their debtors without depriving them of access to clean water. That involves not only the kind of schemes to which the noble Lord, Lord Elliot, and others referred in terms of ease of payment, but also using the courts where appropriate. We do not believe that anybody should be deprived of water. But our
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policy does not mean free water for anyone who does not wish to pay. The water companies have the right to pursue customers who, as the noble Lord said, believe that water comes from heaven straight into their taps with no intervening powers.
Companies should find other ways of obtaining their money and in most cases are doing so. Moreover, the protection we are introducing is not new. In law and practice, in Northern Ireland and Scotland, there are not now and never have been disconnections. In England and Wales, in practice, four of the private water companies already have a policy of no disconnection. An additional five, in practice, carried out no disconnections in the first six months of this year, which led to the figure of only 640 disconnections referred to by noble Lords. So the reality is that we are tackling an historic problem which is now much reduced. We must retain the principle that nobody should be disconnected for not paying their bill, but it must also be the case that the company should have the means of obtaining its returns.
The noble Baroness, Lady Miller, indicated that she approved of the list of premises which would be protected from disconnection and the related use of limiting devices. We probably met all the concerns expressed in another place on that front.
The noble Lord, Lord Addington, raised the issue of protecting vulnerable groups. Perhaps I may clarify that. We propose to offer protection to two fairly broad groups; first, large families on low incomes; and, secondly, those with medical conditions requiring a high use of water. Those on benefits, where they have three or more children, would include those on income support, income-based jobseeker's allowance, family credit, disability allowance, housing benefit, council tax benefit, and so forth. We are therefore talking about protecting a very large number of people who are dependent on benefits.
There is a second group—those with medically related conditions—which I think was the noble Lord's main concern. We are specifying at the beginning such conditions as weeping skin disease, incontinence, abdominal stomas and renal failure which requires home dialysis. We will be setting in place expert groups to advise us on whether we should further extend such groups. In practice, those who are heavily dependent on water should be covered by these exemptions.
On the issue of customer choice and metering, we had some fairly wide-ranging views: from the noble Lord, Lord Addington, who was fundamentally opposed to metering, to my noble friend Lady Young of Old Scone, who was clearly promoting metering as an environmental device. I would probably agree with the noble Baroness, Lady Miller, that providing choice in this area is important; it also provides balance between customer requirements and environmental concerns.
We are intent on putting in place a fair and just framework for water and sewerage services. Nevertheless we do have to observe the environmental impact and we should send out the right signals. In relation to the concerns raised by my noble friend Lady Young. we do provide some incentives by

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allowing customers to choose metering and companies to provide metering. Every customer will now have the right to pay on the basis of volume. Many people will choose this option because they will save money. We have found that households which choose meters cut down their water use by an average of at least 10 per cent., with a concomitant reduction in their bills. That is one fairly hefty incentive.
We have also removed a substantial disincentive, which is the right of water companies to apply charges. There have been charges of up to £250 simply to install a meter. There is a small protection to companies in limited circumstances, as the noble Baroness, Lady Miller, indicated, where there are disproportionate costs. By and large, that would relate to multi-occupied premises. In that context, a number of noble Lords have raised the issue of landlords and, in particular, short-term lets in multi-occupied premises.
The Government would agree that only tenants who pay their own bills will have the right to request a meter, and short-term tenancies are excluded. However, longer-term tenants will be in the same position as other consumers. In many ways the water companies will have the ability to define who, in the short-term let situation, is the supplier; the landlord would then pass on the bills in the normal way, rather than it being the responsibility of the company to collect.
I therefore think that metering and the attractiveness of metering to many groups will lead to a reduction in water use, although, in terms of volume of water, the saving is significantly more important in the area of tackling leakages—something to which the noble Baroness, Lady Hamwee, referred.
There will be a number of customers, however, who will continue to choose a flat charge: currently a charge based to a large extent on rateable value. We continue to leave that option available to those in their current homes.
There have been suggestions by the noble Lord, Lord Elliott, and the noble Baroness, Lady Hamwee, and others that we should move, in principle at least, to a council tax-based system of charging, or at least that water companies should have access to council tax data or order to set their own charging. We have closely examined the proposals that have been made for the use of council tax data or for a more principled approach on that front. A straightforward move to a council tax base would leave a very high number of winners and a very high number of losers, not necessarily related to any economic use of water or to any beneficial social effect. Therefore, we have not yet become convinced, that we should move directly to a council tax-based form of charges, but we are prepared to consider sympathetically any proposals which might move in that direction in a limited way and which reduce the concern about the extent of winners and losers.
Likewise, we are prepared to consider and not to inhibit—as my noble friend Lady Young suggested—the moves of water companies themselves toward innovative tariffs, related both to metered and non-metered consumption. Indeed, we would encourage such innovation, provided it was directed to water savings.
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Particular concerns about metering have been expressed. My noble friend Lord Ahmed was concerned with non-domestic premises. The water companies do have the right to install water meters in all non-domestic premises of whatever description. We would expect them in those circumstances to apply equal treatment to all non-domestic premises that use broadly equivalent amounts of water. I understand that Yorkshire Water have a policy of metering all non-domestic premises using over 30 million cubic metres—that sounds like an awful lot of water. That cannot be right—I have got the noughts wrong here! I will write to the noble Lord in that respect.
The water companies do not have any discrimination in seeing premises either in terms of the use to which those premises are put or, indeed, in terms of the suggestion that there would be discrimination in relation to faith. Nonetheless, I recognise that some religions require the use of water more than others. If there is a concern about the consistency in Yorkshire Water's charging, then, in the first instance, that is a matter for the Regional Customer Services Committee. I would be very happy to pass on those concerns, if the noble Lord will provide me with the details.
My Lords, I have just had a flash of inspiration! The limit beyond which Yorkshire Water install meters in non-domestic premises is 30 cubic metres.
Regarding the regulation of powers, there have been some slightly contradictory concerns about the balance between the powers of the regulator and those of the Secretary of State. These powers will allow a Secretary of State to make regulations on social grounds, to protect the most vulnerable members of our society, and on various environmental grounds. The key role of the regulator in England and Wales is in relation to economic and consumer and customer protection grounds.
There is always a balance in these matters. It has been suggested that the regulation-making powers in Clause 5 are too broad. Subsection 4, however, limits the regulations, in the sense that regulations being made for the purpose of limiting the total revenue of water undertakings would not be admissible under that clause. The effect of the constraint is that, in preparing regulations, where ministers have a legitimate interest, they will be concerned about the distributional effects between consumers or the effect on the environment but they will not be concerned with the overall burden: that is a matter for the regulator. There is, however, a wide range of issues in relation to the structure of charging in which the Government do have a legitimate concern.
I believe that that deals with most of the issues raised in relation to England and Wales. As regards Scotland, first of all, may I indicate, rather diffidently, that we are not being arrogant in relation to our Scottish colleagues. We are providing for the incoming Scottish Parliament a set of amendments which they can adopt or not, but which would be ready-made should they wish to adopt them. Given the consensus in Scotland to engage in a fairly systematic consultation process, it would appear that they have substantial support there. I therefore expressed confidence which was in no sense intended to

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be instructive or mandatory on the Scottish Parliament. The Scottish Parliament is completely free to reject these. Since we have put them on the statute book, however, they will be available if triggered by Scottish Ministers in the Scottish Parliament.
The role of the commissioner in Scotland reflects the different circumstances in Scotland, where the water industry remains in public control. The commissioner will be accountable to the Scottish Ministers and, through them, to the parliament. His responsibilities will be to improve the system of regulating water prices, to create greater financial stability, to strengthen pressure for efficiency in the Scottish water industry, and to retain and reflect a strong independent customer voice through the customer committees to which the noble Earl referred.
The noble Earl also asked whether the commissioner can in fact handle the combined role of customer and economic regulator. We believe that he can. The commissioner will be a professionally qualified individual, skilled in economic analysis and will work to a clear remit which will he set in the Bill by the Scottish executive. Of course, he will be supported by skilled staff drawn from the existing customer councils' staff, who are already skilled in the area.
I was quite glad that the noble Earl did not advocate going back to the 32 authorities in Scotland. The system of democratic accountability is clearly established here, with Ministers, accountable to the Scottish parliament, making the ultimate decision on charge levels. The role of the commissioner in this is that he will put his recommendations to the Minister. In doing so, the Minister may accept the commissioner's advice as delivered; amend it or substitute for it advice of his own. The noble Earl suggested that that could put the commissioner in an impossible position in relation to a dispute. I am glad to say that there are plenty of advisers to Ministers who may potentially find themselves in such a situation without resigning.
However, the Bill also requires the commissioner to publish the initial original advice, along with any changes that Ministers make to it, and Ministers must give their reasons for making the changes. That means that the process of setting water charges is available in transparent information to Parliament and the general public. Of course, in acute situations it may still be a personal matter for the commissioner as to whether or not he wishes to resign. But he cannot complain that his arguments have not been seen, put and considered by all the relevant authorities.
I believe that many of these issues will need to be discussed further. Although there are conflicts of philosophy I do not think there is much conflict as regards objectives. Overall there is support for the general objectives of the Bill, but we will need to discuss them further in Committee. I understand from the usual channels that some discussion is taking place about whether we should consider the Bill further in Grand Committee. While I might welcome that myself, as indeed might other noble Lords, that is a matter for the usual channels.
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As I said. I believe there is much to discuss in Committee. Indeed, we need to take such matters further. I thank all noble Lords who have contributed to the debate and commend the Motion that the Bill be given a Second Reading.
On Question, Bill read a Second time, and committed to a Committee of the Whole House.

Trade Sanctions (USA)
8.32 p.m.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville): My Lords, with the leave of the House, I shall now repeat in the form of a Statement the Answer to a Private Notice Question on the EU/US trade dispute, which has been given in another place by my right honourable friend the Secretary of State for Trade and Industry. The Answer is as follows:
"The EU and US have been engaged in a long-running dispute in the World Trade Organisation over the EU's banana regime. Following two adverse WTO rulings in 1997, an amended regime was agreed by the Agriculture Council in June 1998.
"The US and other complainants maintain that this regime still does not comply with WTO procedures. In November 1998, the US announced its intention to retaliate against the EU by imposing 100 per cent. import duties on selected products. The US sought WTO authorisation for that in January; at the request of the EU, the level of damage the US was seeking in retaliation was referred to arbitration due to be decided on 2nd March.
"On Tuesday this week, the arbitrator, in an initial ruling, said that he needed more information to make a decision, and asked the parties to answer a series of questions by 15 March. He would then return to the issue and come to a final ruling 'soon' afterwards.
"However, the US yesterday announced that, with immediate effect, the US Customs Service would begin 'withholding liquidation' on imports of various EU products, including those of cashmere knitwear. This prejudges the panel ruling and we believe is contrary to the WTO dispute settlement rules. The US argues that they will not apply the duties until after the arbitrator has ruled, but the practical effect of their measures is the same as if they applied now as exporters have to put up a bond to cover possible duties in the future.
"I deplore the action which the United States has taken. It is completely unauthorised by any WTO procedures and wholly ignores the arbitrator's appeal for discussions to continue. Even now, it is not too late for the US to reverse this decision. It should do so not only in the interests of EU-US relationships but to safeguard the whole framework of dispute settlement within the WTO.
"The US action is irrational and unacceptable. I have summoned the US Ambassador and will make these points to him later this afternoon. We shall also support an urgent convening of the WTO General Council.

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"It is particularly regrettable that the American action is directed against industries which have absolutely no connection with bananas or the issues which are in dispute. There can be no justification for inflicting or seeking to inflict serious damage on businesses and communities, in pursuit of objectives which are utterly unrelated to the activities in which they are engaged.
"We are very conscious of the effect that even the threat of US action has been having over the past few months, especially in respect of the cashmere industry. This is a seasonal industry and has been particularly affected. Cashmere orders are now being placed for delivery in the autumn. I spoke this morning to George Pedan, Chairman of the Scottish Cashmere Association, who stressed to me the damaging effect the US action would have.
"In the light of yesterday's action by the US, we have decided that the Government will establish a scheme to guarantee the bonds in respect of the cashmere industry and will discuss with the industry as a matter of urgency the details of this scheme.
"The US action is unacceptable. We shall do all we can to reverse it. I hope the measures I have announced to support the cashmere industry will be welcomed on all sides of the House".
My Lords, that concludes the Statement.
8.37 p.m.
Baroness Rawlings: My Lords, I thank the Minister for repeating the Statement made by the Secretary of State in another place. The revised banana regime, which the US together with a number of Latin American countries are contesting, is against the WTO rules. These were adopted by the EU in July 1998. The UK held the presidency in the first half of 1998, during which they had a golden opportunity to revise EU policy so that it protected our relationship with the Caribbean countries while conforming to WTO, but failed to meet that objective. Can the Minister tell the House what the Government have done at EU level, as they failed to find a solution to defuse the row during the UK presidency?
Currently a series of preparatory meetings is taking place prior to the launch of the next round of talks in Seattle, Washington, on 30th November 1999. We are committed to achieving global free trade by the year 2020. In the light of that, whatever the outcome of the banana dispute, how do the Government view its impact on the next round of the WTO talks? Does the Minister agree that, in the light of recent developments in the EU/US banana dispute, the objective of further trade liberalisation should be balanced by the needs of small island economies, largely dependent on bananas, which cannot diversify easily or quickly into other sectors? Do the Government agree that, by strengthening trade sanctions on totally unrelated goods like cashmere, the US is using the banana dispute as a pretext to protect its own economy and is, therefore, endangering further trade liberalisation?
Finally, will the Minister ask the Prime Minister to intervene in this very serious matter by reminding his friend President Clinton that we are standing shoulder
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to shoulder with him in places like Iraq and we do not expect him to thank us by declaring a trade war on our cashmere industry and on the Scottish Borders?
8.40 p.m.
Lord Razzall: My Lords, I join the noble Baroness in thanking the Minister for repeating the Statement made in another place. Before I heard what she had to say I assumed that all parties in this House would stand four-square behind the Government at this moment, supporting them in the action they are taking in difficult circumstances. I dissociate my party from criticising the Government at this time, even if criticism is appropriate in the future. In my view we should not criticise the Government at this moment. Everyone in this House should give full support to the line which the Government have taken in the Statement.
During the course of today, events have moved on. I hope the Minister can give an indication of the reaction of the American ambassador to the dressing down he clearly received from the Minister's colleague this afternoon. Perhaps the one advantage of discussing this Statement so late is that we may be given some clarification on that point. From these Benches I wish to indicate, on behalf of the Liberal Democrats, complete support for the stand that the Government are taking. This is clearly a moment when we need as a country to stand solidly behind the action the Government are taking.
I wish to mention a couple of points not mentioned in the Statement. I shall elaborate on what the noble Baroness said. This matter does not just concern the cashmere industry and the other UK industries that have been affected. We all know that the underlying problem here is the position of the banana industry, in particular in the Caribbean. An island such as Dominica is virtually entirely dependent on the banana industry. If we concede the position of the United States we may gain a short-term advantage vis-à-vis the industries we must quite rightly protect. On the other hand we have a responsibility to the islands in the Caribbean to stand firm in this matter. The British attitude has been absolutely paramount and must be maintained. We must not forget that for every cashmere industry there is also a banana industry in the Caribbean. That is not to say that it is not absolutely outrageous that the United States should in effect impose sanctions on an industry that has nothing whatever to do with the dispute. I just did not want the position of the banana industry in the Caribbean to become lost in all this. As I said, we have a responsibility to represent those interests.
I now wish to discuss the position of the United States. It has not been mentioned so far but there is something that needs to be said. There is significant suspicion that the reason for the pressure being exerted on the US Government is that a number of the companies involved—and one in particular—were significant donors to the Democratic Party and to the Clinton campaign. That needs to be said in this House. Why should the American Government take this irrational action? They are in danger not only of behaving in an unjust manner, but also of being clearly seen to behave in an unjust manner. They are seen to be

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doing that because of political pressure. That is a statement your Lordships need to take on board. We need to criticise the American Government for that action because in this area they need to be seen to be above suspicion.
I now wish to discuss the wider context of the actions of the US Government in this area. We shall shortly embark on debate on the euro and our role vis-à-vis Europe. We have to recognise that large numbers of Eurosceptics advocate, as an alternative to joining the euro and as an alternative to our relationship with Europe, initiating some form of wider trading area with the United States. I ask those people to consider what is happening today. They need to ask themselves whether the United States is the kind of partner we want to have a trading relationship with.
8.44 p.m.
Lord Sainsbury of Turville: My Lords, first of all I should make it clear that during our presidency of the European Union we led on this issue and indeed an alternative on this matter was agreed. A key part of that concerned meeting our responsibilities under the Lome Convention. That is an essential aspect of this matter which we have sought to meet. We have also sought to comply with World Trade Organisation regulations.
I totally agree that this dispute could imperil trade liberalisation and that is why we are working hard to resolve the issue. However, as I am sure will be appreciated, this requires both parties to be aware of the damage done to trade liberalisation by this action. During past months we have at all levels of government made representations to the American Government, including the Prime Minister speaking to the President. As regards the American ambassador whom we called in this evening, a frank exchange of views took place. The Secretary of State stressed to the ambassador that we regarded the retaliatory action announced by the US Government as unacceptable and asked the ambassador to communicate to the US Government our disappointment that certain industries and communities in the UK which have nothing to do with the production of bananas should have been hit by the US action.
I also wish to make clear that the Foreign and Commonwealth Office will make forcefully to the American ambassador tomorrow points about the political issues. My noble friend the Minister at the Foreign Office met the Prime Minister of St. Lucia yesterday and made quite clear that we stand firmly behind the islands in this matter.
Even at this stage it is open to the American Government to pull back from this situation. I do not believe that an enlightened foreign policy would have led them to take this action. That obviously must raise questions about their motives. They still have the opportunity at this late stage to take account both of the damage to world trade liberalisation of this action and of the advantages of adopting an enlightened foreign policy and to pull back from their action.
8.47 p.m.
Lord Acton: My Lords, is my noble friend aware that I have an American wife and a great affection for the United States? Does my noble friend agree that the Government have had to endure a certain amount of criticism for their helpfulness to the American Administration? Is not this news a poor return for that?
Lord Sainsbury of Turville: My Lords, I make it clear that we are not asking for favours in this case. We are asking that the rules of the WTO are abided by. That is our primary consideration. I believe that an enlightened foreign policy would have led in the same direction.
Lord Redesdale: My Lords, usually when the question of bananas is raised in this House it is seen as a development issue and the responsibility of the DflD. It is extremely unfortunate that it has become a DTI issue because of the nature of the trade sanctions that are involved. I live in the Borders. I realise exactly how devastating the loss of so many jobs will be. I hope that every opportunity will be taken to avoid a trade war. However, if a trade war developed, could sanctions be imposed against the Chiquita company because of the large amount of money that it has given to the campaign efforts of American politicians? If a trade war were to develop, would the Minister consider targeting individual companies?
Lord Sainsbury of Turville: My Lords, I am sure noble Lords will appreciate that this is an EU matter. We shall obviously consult immediately with our EU allies in order to resolve this issue as quickly as possible. Therefore I do not think that at this point it is right to start talking about targeting particular companies.
Lord Hacking: My Lords, will my noble friend and his colleagues—I am glad that my noble friend Lady Symons is present too—express forcefully the stern disapproval of this House of the action of the United States? Although the House is not very full at the moment, I am sure that if the Statement had been made earlier during today's proceedings many others would have expressed the same stern disapproval.
Those of us who have observed for some time the trade difficulties that arise from time to time between trading nations—between ourselves and the United States and ourselves, as part of the European Union, and the United States—note with dismay how easily the United States seeks to fall back upon sanctions. One can think of a number of other examples—the difficulties about meat and other commodities—where the United States has threatened sanctions and, as in this case, threatened sanctions wide of the subject of the dispute. Every time the United States of America pursues such conduct, it causes us strongly to disapprove of it. I hope therefore that these views can be expressed as forcefully as possible to the United States Government through the American ambassador in London.
Lord Sainsbury of Turville: My Lords, I am very happy that throughout the whole dispute the House of

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Lords has been consistent in its disapproval of the action taken by the United States on this issue. I can assure the House that my noble friend the Minister at the Foreign Office will once again make very clear our views and the views of your Lordships' House to the American ambassador when she sees him tomorrow.

Appropriation (Northern Ireland) Order 1999
8.50 p.m.
The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Dubs)The Parliamentary Under-Secretary of State, Northern Ireland Office (Lord Dubs) rose to move, That the draft order laid before the House on 15th February be approved.
The noble Lord said: My Lords, I beg to move that the draft Appropriation (Northern Ireland) Order 1999 laid before the House on the 15th February be approved. The draft order before us today authorises expenditure of £146 million for Northern Ireland departments for the current financial year. This is in addition to the £6,780 million voted by the House last July. The order also authorises the vote on account of £3,120 million for 1999–2000 to enable the services of Northern Ireland departments to continue until the 1999–2000 Main Estimates are brought before the Assembly later this year. Given the restructuring of Northern Ireland departments, with the associated allocation of functions to new/restructured departments it has been necessary to remove department names from Part II of the schedule to the draft order covering the vote on account. The 1999–2000 main Estimates detailing the total estimates provision will also set out the amount voted on account by individual vote under the new departmental structures.
This order covers services which will be devolved to the Northern Ireland Executive and Assembly. With pending devolution it will soon fall to local representatives to make decisions on the allocation of resources between the various Northern Ireland departments. I am sure that your Lordships share my hopes for a smooth transition of power to the Assembly and look forward to the vote on account for 1999–2000 being spent on the services under the new/restructured Northern Ireland departments. The order does not cover the estimates for the Northern Ireland Office, which will remain the direct responsibility of the Secretary of State. As a Whitehall department, the Estimates for the Northern Ireland Office are dealt with separately.
The aftermath of the Omagh bomb has placed significant pressures on budgets and indeed we have had to make additions this year of some £6 million in total largely to cover criminal damage. It also includes some £2.7 million for the health programme covering such areas as hospital and community care, rehabilitation and social and psychological care including voluntary sector support costs.
I know that your Lordships continue to take a close interest in the prospects for economic development in Northern Ireland and I wish to say a few words about the local economic situation before turning to the
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contents of the estimates. The latest available official statistics show that the Northern Ireland economy remains in good health in almost every area. The main economic indicators have, once again, shown very positive results for the Province.
The output of manufacturing and production industries continues to rise at a rate well above that achieved nationally. Over the past four years Northern Ireland's manufacturing sector has increased its output by almost 17 per cent., more than six times the rate of growth achieved nationally. There has also been a significant improvement in the Province's gross domestic product relative to the United Kingdom, with GDP per head in Northern Ireland increasing from 76.9 per cent. of the UK average in 1990 to 80.4 per cent. by 1997.
Record employment levels have also been achieved. At September 1998 the number of employee jobs in Northern Ireland stood at 600,670; the highest September figure on record. This is coupled with the International Labour Organisation's unemployment rate of 6.8 per cent. for the period October to December 1998, the lowest level since comparable records began in 1984. It is lower than Merseyside where the unemployment rate is 11.4 per cent., the north-east at 9.2 per cent., London at 7.5 per cent., Scotland at 7.3 per cent. and Wales at 7 per cent. It is also worthy of note that the Northern Ireland unemployment rate is three percentage points lower than the European Union average of 9.8 per cent. currently. In addition, falls in the numbers of both long term and youth unemployment are particularly encouraging. The latest information available from the Industrial Development Board shows that 1998 has been a good year for investment in the Province. Since April 1998, 15 IDB-supported projects involving planned investment totalling £35.9 million have been announced by locally-owned companies, promoting 759 new jobs while safeguarding 171 existing jobs. Over the same period, 26 IDB-backed inward investment projects have been announced involving a total investment of £81.1 million, promoting 1,884 new jobs and safeguarding a further 143 existing jobs.
Allied to this are the survey results from the local business community. Despite a number of recent business surveys reporting falling optimism among Northern Ireland business leaders, particularly within the manufacturing sector, the main economic indicators point to continued growth in demand and output during 1999.
All of this clearly demonstrates the impressive achievements of the Northern Ireland economy which, coupled with political stability, provides Northern Ireland with an opportunity for a brighter economic future.
With your Lordships' permission, I now turn to the main items in the Estimates, starting with the Department of Agriculture. In Vote 1, which provides for Northern Ireland expenditure on national agriculture support measures, an additional £36.5 million is required. This includes £17.7 million to cover an increase in advance funding from 60 per cent. to

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80 per cent. under the suckler cow and beef special premium schemes, £9.3 million in respect of further agrimonetary compensation for the beef sector; and £8.5 million is for increased rates paid under the hill livestock compensatory allowances scheme.
In Vote 2, covering local agriculture support measures, a net increase of £12.4 million is sought. This includes £7.7 million in respect of controlling outbreaks of animal diseases, including tuberculosis, brucellosis, salmonella, Newcastle disease and BSE, and £1.5 million for the Redmeat Marketing Strategy to help recover export markets for Northern Ireland beef.
I now turn to the Department of Economic Development, where token increases of £1,000 are sought in Votes 1 and 2. In Vote 1, £2.7 million is required by the Industrial Development Board to meet the costs of the very successful North American Roadshow, which took advantage of the favourable climate generated by the Belfast agreement to promote Northern Ireland as a profitable investment location. Some £6.3 million is also sought to meet pressures on industrial development grants resulting from increased claims from IDB client companies. These increases are offset by reduced requirements and increased receipts elsewhere within the Vote.
In Vote 2, a token increase of £1,000 is also sought. Within the Vote there are a series of self-adjusting changes resulting in offsetting savings covering any increased requirements. The major element within this Vote is an additional £0.5 million for the Northern Ireland Tourist Board to meet increased promotional and marketing activities.
In Vote 3, a net increase of £6.1 million is sought by the Training and Employment Agency; £5.6 million is sought for the Jobskills Programme, training centres and community projects to meet increased demand for payment of training allowances. A further £5 million is for the welfare to work initiative to provide a range of employment and training measures within the New Deal, mainly for the long-term unemployed. These increases are offset by savings elsewhere within the Vote.
Turning to the Department of the Environment, a net increase of some £4.8 million is sought in Vote 1. The main increases are £5.1 million for roads maintenance while an additional £2 million is needed to support the running costs of Northern Ireland Railways. The Chancellor's Fund provided £0.5 million for roads and £1 million for work to St. Angelo airport in County Fermanagh. These increases are partially offset by reallocations from other areas and increased receipts.
In Vote 2, covering housing, a token increase of £1,000 is sought. The Chancellor's Fund provided some £2.8 million for improvements to certain housing estates, and there is a need for a further £4.9 million to support the work of the Northern Ireland Housing Executive. There has also been a drop of £1.8 million in the anticipated level of receipts. These pressures are offset by reallocations of £6 million from planned expenditure on renovation grants and £3.7 million in
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housing association spending. The gross amount available to support housing in Northern Ireland this financial year is approximately £609 million.
In Vote 3, covering water and sewerage services, a net increase of £2.3 million is sought. Some £6.3 million is required for increased operational costs, with a further £2.2 million to meet additional running costs. This is offset by additional receipts of £2 million, together with a reallocation of some £4.4 million from planned levels of capital expenditure.
In Vote 4, which covers environmental and other services, a small increase of £0.5 million is sought. Additional expenditure of some £3.5 million is needed for accommodation and supplies costs arising from the proposed political settlement, and £6.6 million reflects the carry forward of running costs and capital underspends from previous years. These increases are largely offset by additional receipts and a reduction of £4 million in matching funding relating to the EU Peace and Reconciliation Programme.
In Vote 5, which covers fire services, an additional £3.8 million is sought of which £2 million is for the development of a new fire training centre and £0.7 million is needed for superannuation costs of fire service personnel. A further £0.9 million reflects the carry forward of capital underspend from 1997–98.
I now turn to the Department of Education, where a net increase of £46.3 million is sought in Vote 1. The main element of this is £38.5 million for student loans due to a reduction in expected receipts from the second tranche of the national sale of the student loans book debt, owing to a change in the amount of the sale. The remaining increases include £0.3 million for costs arising as a result of the Omagh bomb, £1.3 million for energy efficiency measures mainly in schools, £0.9 million for the Council for the Curriculum, Examinations and Assessment, some £2 million capital and recurrent provision carried forward under the end year flexibility scheme and £2.5 million for the Odyssey Millennium Project.
Turning to the Department of Health and Social Services, a net increase of £38.2 million is sought in Vote 1 for expenditure on hospital, community health and personal social services, health and social services trusts, family health services and certain other services. This includes £29.3 million carried forward from 1997–98 under the end year flexibility scheme and £9.2 million towards winter and other pressures offset by reductions elsewhere within the vote.
Moving on to Vote 4, a net increase of £12.5 million is required. This includes £16.9 million to fund running costs, capital and other administration pressures in the department and takes into account an additional £1.6 million in respect of administering the welfare to work initiatives. The increases are offset by an increase in receipts of £4.4 million, mainly from the National Insurance Fund in respect of the recovery of administration costs.
Turning to the Department of Finance and Personnel, a net increase of £7.8 million is sought in Vote 1. This includes £1.5 million to provide support for new

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institutions flowing from the Belfast Agreement and £1.7 million reflecting the carry forward of running costs underspend from 1997–98.
Finally, an increase of some £1.4 million is sought to cover additional costs arising within the new Northern Ireland Assembly.
I hope that this short summary of the main components of the estimates is helpful. I commend the order to your Lordships.
Moved, That the draft order laid before the House on 15th February be approved.—(Lord Dubs.)
Lord Molyneaux of Killead: My Lords, the House is being invited to endorse additional expenditure of £146 million for the current year. Secondly, and more importantly, we are invited to give approval to the much larger sum of £3,120 million to enable Northern Ireland services to be financed pending the new Northern Ireland Assembly's approval, and to approve the main estimates for the coming year.
There is an urgent need for early decisions on the mechanism for dealing with approval in the near and intermediate future. Approval is needed for authorisation and scrutiny of expenditure by all the departments that will be devolved to the Northern Ireland Assembly. The separate funding for those areas of government reserved to the United Kingdom Parliament, as the Minister has rightly said, is not within our remit this evening.
However, there is a dichotomy. Looking at all the various documents being produced by and on behalf of the Assembly, I cannot help thinking that there is a degree of overlap in the functions of the United Kingdom Parliament and Government and of the Assembly. That overlap was not so apparent during the lifetime of the previous Stormont parliament and government. I had the impression that there was a general belief that a perceived "restored" Stormont, as is often referred to, would automatically reinstate the financial arrangements that existed during the lifetime of the Stormont parliament.
Those who take that rather simplistic view forget that, until 1972, there was no Northern Ireland Office. Presumably, the Vote on those matters for which the United Kingdom Government remain responsible would have been fairly small compared with that over the past 10 years. The Northern Ireland Office now has its own budget and, depending on various factors beyond the control of any of us, it can expand very rapidly. That structure, which existed until 1972, and that very clear division no longer exist. There will be a certain parallel with legislation in the Welsh Assembly and in some respects the Scottish Parliament.
There are problems and overlaps which, as yet, have not come over the horizon in regard to all three areas of the United Kingdom. That being the case, why is it proving so difficult to complete the design of what one might loosely call accountability and control of expenditure, given that all three regions of the United Kingdom have featured so prominently in the
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deliberations of your Lordships' House and the other place for a good deal of time? I notice that the Whip is taking account of this particular point.
For the first two years of this Parliament, Northern Ireland has featured in terms of the usage of the time and facilities of the draftsmen in a way that probably did not happen over the previous 20 years. The Minister of State in another place, Mr. Murphy, has explained that the President of the Council and Leader of the other place is looking at the issues in so far—these are the Minister's words—"as they affect Northern Ireland, Scotland and Wales." There is a certain commonality, and there ought to be a commonality, in our approach to all three areas so that at least there is a degree of uniformity and one area is not out of step with another.
Will the Minister share my view that progress could be hastened if senior Ministers in Her Majesty's Government could begin with a basic design for all three regions of the United Kingdom? They could then consider slight variations that might be desirable in the light of local differences.
I raise a brief question under Department of the Environment Vote 1. The Chancellor of the Exchequer announced his generous package for road improvements and much else besides. The fact that the Chancellor made the announcement gave the impression that it was a Treasury initiative, a Treasury bonus, perhaps over and above any future appropriation order. However, confusion arose when the local Stormont Department of Finance made it clear that the Treasury bonus would become available only if the Port of Belfast were privatised and the proceeds and receipts used to fund the Chancellor's generous hand-out. That sounds to me like selling the family silver. Perhaps the Minister can provide some much needed clarification.
I have a final point under Department of the Environment Vote 4 relating to planning. In regard to recent proposals for the expansion of facilities and ancillary undertakings at Aldergrove international airport, can I assume that the Minister in his department and the Department of the Environment welcomed those statements, first, on the grounds that such a hub of commerce and industry around the airport would provide lasting benefits for the entire Province and, secondly, because the provision of employment centred roughly on the airport and the town and borough of Antrim would provide employment in an area extending well to the west of the Province where there has been much depression caused by the closure of what appeared to be secure undertakings?
There is a general appreciation of the diligence and determination of the Minister in directing and encouraging all who serve in his wide ranging department and the results that he has achieved. In addition to the burden that he carries in representing and answering for all Stormont departments in your Lordships' House—sometimes we are inclined to forget this—I am certain that we can rely on the Minister to use his experience and initiative in co-ordinating all the various agencies and furthering this much-needed set of projects for the enhancement of the airport, not just the passenger side, but what flows from that by way of

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auxiliary undertakings in the area of the airport. We had high hopes at one time that there would be expansion there because it was going to be a kind of tax-free area, but that did not happen. This seems to me a good opportunity to carry that forward. The attraction for one of the Minister's departments—namely, the Department of the Environment—would be that this could all be done at no financial cost to the department. That ought to bring him good cheer.
It was encouraging to hear from the Minister the good news about the improvement in the economy and a further reduction in unemployment. All of that we welcome and applaud. But, like the Minister, we regret the continuing problems of farmers. He will know that, despite the financial support of his department of Agriculture, the pig sector is rapidly collapsing. That is a fact which we have to face. I trust that the Minister will receive full support across the Province for any measures he can take in the form of what would now amount to a rescue mission.
9.15 p.m.
Lord Redesdale: My Lords, I believe that the delay in the implementation of parts of the Good Friday Agreement has left this House with a continued responsibility to discuss the appropriation order for Northern Ireland. I am sure we all agree that the sooner the agreement can be implemented in its entirety the better. To that end, we all wish the Government well in their efforts to accelerate the establishment of an executive on terms that are acceptable to all who invested goodwill in the agreement last April.
I am sure that the Minister of Finance of the new Assembly, being held to account by that Assembly, will be able to do the issues involved more justice than we can tonight. No doubt when the new Minister of Finance announces next year's budget to the eager members of the Northern Ireland Assembly the attendance will be far greater than it is here tonight!
However, we are presented with an opportunity, since, if this is the last appropriation order to be dealt with by this House, as we all hope. we can be sure that it will be against this appropriation order that future budgets in Northern Ireland will be compared. Whatever the new Minister of Finance announces next year, those changes will inevitably be compared with the figures we pass tonight. This order will therefore probably be judged more critically than most of its predecessors, even if that criticism is blunted because it is indirect and because it is delayed by 12 months.
With that in mind, it would be nice to think that we could bequeath Northern Ireland a golden inheritance. Unfortunately, this order seems to have been bound by the Treasury orthodoxy that money is always tight. In some areas it bequeaths a silver inheritance; in a few others, more base metals spring to mind.
Let me start with the areas on which the Government have done well. Agriculture, which has already been discussed by the noble Lord, Lord Molyneaux, accounts for almost 5 per cent. of gross domestic product in Northern Ireland and employs 6 per cent. of the
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workforce, compared with 2 per cent. and 2 per cent. respectively for the rest of the United Kingdom. In addition to its other woes, the Province has been one of the areas hardest hit by the recent problems in agriculture, in particular in securing export markets for some agricultural products. I am particularly pleased, therefore, to see that in this order the Government are allocating an extra £36.5 million to the Department of Agriculture. That is considerably above the annual rate of inflation and will go a great distance towards shoring up an industry which has been hard hit.
However, there is more that the Government can do for this vital industry. I understand that last year some £4 million in quota support from the Common Agricultural Policy which should have gone to Northern Ireland farmers to supplement the suckler cow premium remained unclaimed. Although the Government are not directly responsible for this shortfall, they should try to ensure that in future all these European funds are taken up. Further down the line, if the Objective 1 status for Northern Ireland is lost, the Government may have to step in to help Northern Irish farmers further. Although agriculture is to be devolved under the new arrangements, the Minister will be aware that dealings with Europe on all matters including agricultural grants are not, so the Government will need to keep an eye on this. They have done reasonably well so far, but there is no room for complacency.
With regard to education, I fear that the Government have fared considerably worse than they have with regard to agriculture. Putting teachers' superannuation to one side, it seems that funding for education is to be increased by only 1 per cent. in the coming financial year. That follows this year's increase of only 2 per cent., which was also below the rate of inflation. And we must remember that these meagre increases—cuts in real terms—are to an education service already struggling from serious under-funding.
I also understand that some of the reduced overall total of funding is to be sidelined into other areas: energy efficiency in schools, the Council for the Curriculum and costs associated with the Omagh bombing. We have nothing against these special areas of funding—indeed, they seem to be very worthy causes—but they leave even less money in a pot that was never full in the first place. This will stretch teaching resources in Northern Ireland even further. To suggest that money can be saved by cutting back on education is a false economy. I fear that the Government have forsaken their last opportunity to give the schools and colleges of Northern Ireland the boost that they need for long-term stability before control on this issue is devolved to the new structures.
As with all large expenditure totals, there is also the question in the area of education funding of how the global figure is distributed between competing demands. I have come across several well-researched reports and indications, backed up by the most heart-rending testimonies, that integrated education continues to do poorly in several senses of the word. We very much applaud the steps that the Government have taken to remedy this. I believe that they share with us the hope that integrated education has real potential to prevent

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future generations being blighted by the tribalism instilled at an early age that has been so destructive in Northern Ireland. The Government's recent decision to support all but one of the integrated schools established by parents—originally without government support—is one that we admire, and we hope it yields long term benefits in the Province.
Unfortunately, the basic facts remain that the demand by both parents and pupils for integrated education is very much greater than the supply and that, where it is in supply, it is not well funded at all. I hope that in this "limbo time" before the executive is established the Government will at least make one further gesture in support of integrated education by agreeing to fund Ulidia integrated primary school, which, sadly, remains dependent on the goodwill of parents and philanthropists.
I should like to conclude by dealing with one quandary brought to my attention recently. I refer to the difference between two figures. One is the suggested figure for the running costs for the new Assembly; the other is the estimated expenditure voted on by the Assembly itself. There is a difference between the £14.5 million on which the Government expect the Assembly to be able to run and the figure of £36.8 million that the Assembly is considering. I realise that these figures must be looked at much more closely to see which bears a closer resemblance to the truth. However, the large divergence between the two figures is a cause of concern.
9.22 p.m.
Earl Attlee: My Lords, I am grateful to the Minister for his explanation of the order. Noble Lords will not be surprised to hear that I sneaked a look at the previous debate on a similar order. My noble friend Lord Cope of Berkeley at the time observed that that might be almost the last time that the House debated such an order. We are still debating it this year. I agree with the noble Lord, Lord Redesdale, that it is even more likely that this will be the last occasion. Presumably, next year the matter will be covered by a block vote from the Treasury to the Assembly and the Northern Ireland Office. I found the figures confusing, and I am grateful for the contribution of the noble Lord, Lord Molyneaux. I share the concerns of the noble Lord, Lord Redesdale, about the education budget. The noble Lord, Lord Molyneaux, made interesting observations about devolution matters in general.
The Minister made light of the difficulties of agriculture, but these problems are not peculiar to the Province; they apply everywhere. The support that he has given to agriculture is welcome. I join the Minister in welcoming the improvement in the employment situation in the Province. I was pleased to cover this matter in our debate last week. I believe that this improvement is the fruit of the relative peace and stability in the Province.
Perhaps I should have studied the figures more closely. Clearly, the fire service is a vital emergency service for the Province, but I was a little surprised when the Minister mentioned the training centre. Is it
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economic or effective and does the number of courses it runs make it worthwhile? I do not expect the Minister to respond or worry too much about my question tonight. I was a little surprised by his comment, but as I have not studied the matter previously I have no particular view on it.
I am concerned about the macro-economic effects of any welcome reduction in expenditure on security as and when it is prudent and safe to do so. I mentioned the subject last week, but it bears repeating. Expenditure on the RUC is more than £400 per man, woman and child in the Province. There would be a major effect on the economy if it were to be significantly and rapidly reduced. As it is a reserved matter, any savings will go to the Treasury in London via the NIO and not to the block Vote for Northern Ireland to be reallocated by the Assembly. Thus, there is little incentive to reduce the need for high expenditure on the RUC, either on the part of the unionists or the nationalists. I am not advocating continued high expenditure on the RUC just for the sake of the economy in the short term; I am just interested in the consideration that the Minister has given to the problem.
There is a further problem relating to the RUC and any redundancy or compensation payments. I accept that it is not strictly relevant to this order, but the costs will be considerable although necessary. Indeed, the Prime Minister has said that the payments will be generous. The payments will have to be funded by the Treasury. Are they being built into Treasury forecasts? If not, there is a future danger that unnecessary expenditure on continued and unnecessary manning of the RUC could be incurred because of a lack of funds to pay lump sum compensation payments. It may be that the Minister cannot help me tonight, but will he draw the problem to the attention of his right honourable friend the Chancellor of the Exchequer?
If I misheard what the Minister said about agriculture, I apologise. My observations apart, I am content with the order.
Lord Dubs: My Lords, I am grateful for the comments that have been made and I will do my best to answer the specific questions.
The noble Lord, Lord Molyneaux, referred to the Chancellor's initiative and asked about spending on roads and its relationship to the proposals for Belfast Harbour. When the Chancellor made his Statement he made it clear that some of the money—the estimate was £70 million—towards improvements in the strategic road network would come from the proceeds of the sale of Belfast Harbour. The Government believe that the strategic road network is very important and improving it is to the economic benefit of Northern Ireland. We also believe that there need to be changes in the structure and management of Belfast Harbour because it is constrained by its trust board status from competing as effectively as it would wish and it cannot use its money as it would like for the benefit of the harbour. Accordingly, the harbour commissioners came forward with their proposals.

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The commissioners consulted the political parties—some were supportive and some were critical—but the final scheme has not yet been produced. However, the issue will be for the Assembly to decide, as the Secretary of State made clear. It will be up to the Assembly to decide how much of the Government's proposals it wishes to continue to pursue—I hope virtually all. It will be up to the Assembly to decide whether it wishes to proceed with the strategic road network as funded by the proceeds from Belfast Harbour; whether it can raise the money for the network from elsewhere; whether the network is not of such a high priority as we had thought. However, that will be a problem for the Assembly.
The noble Lord, Lord Molyneaux of Killead, also asked about the development or possible expansion of facilities at Aldergrove airport. We have been in discussion with the developers at Aldergrove for some time over their proposals for commercial development. For the most part, the proposals are acceptable, subject to certain road access improvements to cope with the additional number of people who will travel daily to and from the airport. I refer to proposals for call centres, distribution centres and aircraft maintenance facilities. However, the proposed factory outlet centre does not accord with the policy on out-of-town retail developments. We are having further discussions with the developers with a view to addressing an acceptable overall development.
The noble Lord, Lord Molyneaux, also asked about Northern Ireland legislation and devolution arrangements. He asked why there are some differences between the plans for Northern Ireland and those for Scotland and Wales. I think he suggested that there might be more uniformity across the three sets of arrangements. The noble Lord will be aware that the devolution arrangements for Northern Ireland flow from the Belfast agreement. The legislation which has come before your Lordships' House over the past year has been based upon that agreement. To that extent, therefore, it is not possible for there to be a commonality of approach between Northern Ireland, Wales and Scotland, as the noble Lord proposed. Furthermore, in Northern Ireland we are building on the method of government when Stormont was in charge and on some of the arrangements from there. Again, that does not apply to Wales and Scotland.
Lord Molyneaux of Killead: My Lords, I am grateful to the Minister for giving way. In case my remarks misled him, I should point out that I was not thinking of the devolution of powers to the three areas of the United Kingdom but of the very sensitive area of how the financial arrangements for all three will be dovetailed. I gather it is that matter on which the Leader of the House of Commons and the President of the Council are concentrating at the moment.
Lord Dubs: My Lords, given the answer which my right honourable friend the Leader of the House gave in the other place, I do not think that it would be appropriate for me to go into the details. I should be
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happy to explain to the noble Lord how we see things developing as regards Northern Ireland. I am not so well acquainted with the thinking on Scotland and Wales. However, if the noble Lord is anxious to have a fuller answer, I should be happy to try to provide one.
The noble Lord, Lord Redesdale, asked about education funding. I agree that it is sometimes difficult to deduce from this order what is an increase in funding for any particular activity. I appreciate the problem there. However, my understanding is as follows. Education will receive increases of £90 million, £195 million and £259 million in each of the next three years. That represents increases of 3.7 per cent., 4.3 per cent. and 1.4 per cent. in real terms. I can reassure the noble Lord that the Government's commitment to increased expenditure on education is being met, even if the way in which the appropriation order is designed does not spell it out as clearly as perhaps he and I would wish.
The noble Lord also asked about the crisis in the pig industry. Indeed, the noble Earl, Lord Attlee, also referred to that. I hope that I did not misunderstand him. I thought for one moment he was suggesting that I was not taking agricultural problems seriously, but he then made it clear that that was not the case.
I am aware that Northern Ireland agriculture has gone through a particularly difficult time. I refer not only to the pig sector. Unfortunately, many other sectors are simultaneously facing serious difficulties. On a number of occasions the Government have produced packages of help. That has happened both within the past year and a little longer ago. They were geared at the most vulnerable sectors of the industry. They benefited the beef sector particularly as we added to the suckler cow premium, especially in disadvantaged areas. We also provided some help for the sheep sector.
However, the pig industry is in particular difficulty. Following the fire at the pig processing plant in Ballymoney, which accounted for 40 per cent. of Northern Ireland's entire facility for dealing with pigmeat, farmers had the serious problem of being unable to get the pigs off their farms and for sale. The problem was aggravated by low prices and by a general over-supply in the European Union. We took action and introduced a pig welfare scheme last August/September to deal with farmers whose pigs were overweight and could not be removed from the farms. We helped farmers to deal with some 17,000 pigs and each farmer received £30 compensation.
However, we as a government are very limited by the European Union with regard to what we can do. Unfortunately, many of the requests I have received for additional help for the pig industry have had to be given the reply, "We are not allowed to do it; Brussels won't let us." We have been in touch with Brussels throughout the crisis and a senior representative from the Commission has visited Northern Ireland within the past few weeks. My right honourable friend Nick Brown, who is in charge of all the arrangements at MAFF, visited Northern Ireland and saw the situation for himself. However, we are simply not allowed by Brussels to do everything we are asked to do. We are very limited. Indeed, the European Commission has

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objected to the compensation we offered under the pig welfare slaughter scheme. We are still contesting the Commission's findings on that.
Certain developments in the European Union have helped. There is now a proposal to provide food aid relief measures for Russia. That will take some pigmeat off the European market. There have also been a number of other schemes. However, I appreciate that the problem in the pig sector is still very serious. We shall have to await the result of the Commission's visit to Northern Ireland as regards taking that further. I could spend a great deal of time discussing the problems of agriculture in Northern Ireland, but it would perhaps take up more time than is appropriate.
The noble Lord, Lord Redesdale, asked why the costs of the Assembly have increased from £14.3 million to £36.9 million. The initial estimate of £14.3 million was based on the main estimated provision for 1998–99 and it was always accepted that some further provision would be necessary; for example, to take account of the Senior Salaries Review Body's recommendations on Members' pay and allowances and the Members' pension scheme. The figure of £36.9 million is the Assembly commission's estimate of the operating cost of the Assembly in a full financial year. That figure was decided by the Assembly within the past week or 10 days. It includes the cost of 400 administration staff, the SSRB recommendations, committee and party costs, research and IT, and printing and publishing costs. As the commission recognised, the actual cost of operating the Assembly in 1999–2000 will depend on a number of factors, including the date of devolution and when the additional staffing identified by the commission takes up duty.
When the order was prepared, we were not aware of the Assembly's decision leading to the figure of £36.9 million for the next financial year. So we were working on the information available to us at the time. Clearly, it will be for the Assembly to decide how it balances its books in the coming financial year. It is a decision for the Assembly. That is part of the process of devolution.
The noble Earl, Lord Attlee, asked a number of questions. I believe that I have dealt with his points as regards agriculture. I believe that the fire training centre is an important provision. I am satisfied that it will be of benefit to the fire service in Northern Ireland and that it will be used effectively with sufficient economies of scale to make it a worthwhile operation. I dealt with that in quite some detail some months ago when I gave the go-ahead for the scheme, but I am certainly happy to write to the noble Earl and give him fuller information on the basis of the question he asked.
As regards spending on the RUC and the assumption that the noble Earl made that there would be a reduction in that expenditure, which I believe is reasonable, given that the RUC represents a level of staffing way above what one would expect in a normal, civilian peacetime situation for a population of the size of Northern Ireland, that assumption is understood by the RUC. Of course, any reduction in expenditure would be made in the light of recommendations from the Chief Constable about the
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security situation at the time. So we cannot estimate the speed at which there might be a decline in expenditure on the RUC because we await the frequent security assessments from the Chief Constable on the basis of which we will make reductions if that is recommended.
Of course, in the shortish term redundancy payments will be an expensive cost, as they will be in the prison service. Therefore, 1 do not foresee a reduction in total spending having a damaging effect on the Northern Ireland economy, which I believe was the thrust of the noble Earl's remarks. I shall make sure that his views are made known to my right honourable friend the Chancellor of the Exchequer as being a concern that the noble Earl has expressed, not for the short, but the medium term.
I believe that I have answered all the questions. In one or two instances I have said that I shall write to noble Lords with fuller information.
On Question, Motion agreed to.

Water (Northern Ireland) Order 1999
9.41 p.m.
Lord Dubs Lord Dubs rose to move, That the draft order laid before the House on 22nd February be approved.
The noble Lord said: My Lords, the purpose of the draft Water (Northern Ireland) Order is to strengthen the law to combat water pollution and conserve water resources and to promote the use of waterways for recreation. The order will up-date and extend the Water Act (Northern Ireland) 1972.
I should like to draw your Lordships' attention to an interesting historical point. The 1972 Water Act was one of the last pieces of legislation to be passed by the old Stormont Parliament while the Water (Northern Ireland) Order may be one of the last measures relating to Northern Ireland to come before this House.
I believe that it may be helpful to the House if I say a few words about the detailed provisions. Articles 11 and 21 will enable the Department of the Environment for Northern Ireland to make schemes for fees for applications for discharge consents and abstraction or impounding licences.
The powers in the 1972 Act to make regulations to control water abstraction have never been invoked because of Northern Ireland's abundant natural supplies of water. The need for such regulations is at present under review. The opportunity has been taken in Article 20 of the order to revise the powers in the 1972 Act to include protection for existing rights and to enable the impounding of water to be controlled.
Article 9 and Schedule I to the order provide new procedures for dealing with applications for discharge consents. For example, applications for revised consents will also have to be advertised and a public inquiry may be held to consider representations in response to the advertisement of applications. Article 12 will enable enforcement notices to be issued to specify the measures which must be taken to ensure compliance with conditions imposed on discharge consents.
Article 14 extends the powers to make regulations to prevent pollution to cover sources such as agriculture and industry. Where polluting matter has been discharged into a waterway or water in underground strata, Article 17 will enable the Department of the Environment to serve an anti-pollution works notice on the person responsible. The works notice will require him to take anti-pollution measures to remove the polluting matter. A notice may also be served to prevent pollution occurring. The water provisions of the order do not directly implement any EC directive.
Part III of the order addresses an increasing demand for recreational facilities and inland navigation. The success of the Shannon-Erne Waterway, restored in 1994 as a joint venture with the Republic of Ireland, has stimulated interest in canal restoration. The powers of the Rivers Agency of the Department of Agriculture under the Water Act (Northern Ireland) 1972 were limited to minor works.
Articles 41 to 45 enable that department to undertake works to promote the recreational or navigational use of any waterway. Article 46 provides for projects, such as the restoration of a derelict canal, to be taken forward in partnership between the department and other sponsors who may be able to draw on alternative sources of finance such as the National Lottery or EC funding. Such partnerships could extend under Article 47 to authorities within the Republic of Ireland in the case of a major improvement on a cross-border waterway.
The department may acquire land within Northern Ireland for those purposes, either by agreement or by vesting using the procedures in the local government legislation. Any canal restoration project would require the preparation and publication of an environmental impact assessment in accordance with EC obligations.
Article 49 authorises the department to make orders to regulate recreation and navigation on any waterway, and under Article 50 charges may be made for the use of facilities on waterways and licensing of craft. In exercising those powers, the department would consult with local interests on waterways.
The order will provide additional powers to protect surface and ground waters and promote recreational use and navigation of waterways. It will also facilitate the transfer of recreational and navigational powers, initially to the new department of culture, arts and leisure and then, under an agreed phased programme, to the cross-border implementation body on inland waterways. I beg to move.
Moved, That the draft order laid before the House on 22nd February be approved.—(Lord Dubs.)
Lord Molyneaux of Killead: My Lords, Article 7 of this order deals with pollution and the penalties for pollution of waterways. I accept that accidents can happen in the best of circles and any action designed to deal effectively with industrial undertakings and others who repeatedly offend against the law must be welcomed.
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However, the Department of the Environment has an internal problem by reason of the fact that certain sections of the department and certain of its employees have, on occasion, caused serious pollution damage to fish and sometimes livestock. In the eyes of the law and in the context of this amending order they are guilty of an offence and liable to the penalties defined in Article 7(7)(a) as,
"imprisonment for a term not exceeding 2 years or to a fine or to both";
and in Article 7(7)(b) as,
"imprisonment for a term not exceeding 3 months or to a fine not exceeding £20,000 or to both".
I do not expect the Minister to give details tonight, but I am tempted to ask what penalties or sentences have been imposed on officials of the Department of the Environment who have on occasion admitted that they caused pollution on a significant scale? I am not advocating draconian punishment; but it must be accepted that those offenders have not set a good example to others. In a real sense they are weakening the authority of the department itself.
Earl Attlee: My Lords, I am grateful to the Minister for his full explanation. The other night-1 make no complaint—I took out a little bit of light reading—a consultation paper on ground water. I was interested to note that ground water was mentioned by the Minister and, again, I make no complaint. The noble Lord, Lord Molyneaux, raised an interesting point regarding pollution by public bodies and I shall be interested to hear the Minister's response in that regard.
The Minister referred to provisions for water-based tourism and leisure. I covered the opportunities for tourism in a debate that we enjoyed last week. I reiterate that there is a great future for tourism in the Province and a lot of opportunity; water-based tourism will be an important part of that.
Article 50 provides for charges relating to water-based leisure. My question is on what basis will these charges be made? Will they be merely to cover the costs of collecting the fees? Will they be to make profit? Will they be to fund capital works, perhaps improvements in new locks and towpath enhancements? Will the funds received be ring-fenced or will they go to the general budget? In particular, what improvements will be seen by users of the waterways as a result of the charges that they will pay? I believe it is partly for safety improvements. Are there are significant safety problems on the waterways? If there are, when does the Minister expect that these will be overcome?
The order refers to the Laganside development. I first saw the development in 1997 as a result of a visit organised by the noble Lord, Lord Eames. My noble friend the Duke of Abercorn has been heavily involved in this development and I was extremely impressed by it. Article 59 provides for the Laganside to issue byelaws, and they seem to be very extensive to say the least.
There is a problem and it is related to the comments of the noble Lord, Lord Molyneaux, regarding regulation. There has been a similar problem with the

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Civil Aviation Authority, where they both provide the safety regulation and operate the National Air Traffic Services. That problem is being addressed, but we have a similar difficulty with regard to water supply.
Some time ago the Minister issued a consultation document on water and sewerage services. On page 23 of that paper, he says:
"The existing agency arrangement has the benefit of guaranteeing close political control of these essential public services".
We agree with him in that. It continues, "However"—and this is the salient point
"this option is difficult to sustain because of the desirability of having greater separation between the environmental regulator and the service provider".
The problem as I see it is that the environment department is responsible for the heritage services department and also the water service. I fully accept that this is not in the same league as the Civil Aviation Authority in terms of a problem, but it is an important consideration and I look forward to hearing the Minister's comments on that point.
Apart from those observations, I am content with the order.
Lord Dubs: My Lords, I am grateful for the comments that have been made and the constructive way in which noble Lords have approached this order.
One of the questions which underlies the various contributions that have been made concerns the relationship between the water service and the Environmental and Heritage Service. The poacher and gamekeeper analogy is probably the one that noble Lords had in mind.
Specifically in relation to the question asked by the noble Lord, Lord Molyneaux, about penalties on DoE officials, perhaps I may say this. The water service, as part of a government department, has Crown immunity and cannot be prosecuted under the order for the offence of water pollution. However, the consultation paper to which the noble Earl, Lord Attlee, referred and which I launched last year, Water and Sewerage Services in Northern Ireland, put forward options for new structures for the water service which could result in it being outside central government and open to legal proceedings under the order. After devolution, that will of course be a matter for the Northern Ireland Assembly. In any case, the proposed new arrangements for departments in Northern Ireland will also go some way towards dealing with the point, because in the new proposals the Environment and Heritage Service will remain with the Department of the Environment—that is to say, the new-style Department of the Environment—whereas the water service will transfer to the new Department of Regional Development. Therefore, in any case, in so far as EHS monitors or oversees the water service, it will in future be in a separate department.
Perhaps equally, if not more, important are the proposals contained in the consultation paper to which I referred. As I said, it will be up to the Assembly to decide whether it wishes to implement any changes in water and sewerage services. I very much hope that it will. Given the responses that we have had so far to that
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consultation document—that is to say, the ones of which I am aware—I believe that there is broad support for the approach of taking the water service at least one step away from the present DOE and therefore making it liable, as I said, to possible action for the offence of water pollution. It would also be seen to be a more independent way of overseeing or monitoring the work of the water service.
The noble Earl, Lord Attlee, also asked about the basis for tourism charges—for example, charges on the waterways for using locks, and so on. I can confirm that all those charges would be ring-fenced. The income would only be used for the purposes for which it was collected; namely, for the improvement of locks or generally for improving the particular facilities of which the tourists were taking advantage in using the waterways. I am not aware of any particular safety problems, but perhaps I may look into the matter and write to the noble Earl giving him further information.
I am grateful for the very constructive comments that have been made. As I said, I shall write to noble Lords with fuller information. I commend the order to the House.
On Question, Motion agreed to.

Strategic Planning (Northern Ireland) Order 1999
9.56 p.m.
Lord Dubs Lord Dubs rose to move, That the draft order laid before the House on 22nd February be approved.
The noble Lord said: My Lords, the purpose of the Strategic Planning (Northern Ireland) Order 1999 is to require the new Department for Regional Development to formulate a regional development strategy for the long-term development of Northern Ireland and co-ordinate its implementation.
Perhaps I may explain the context in which the order is being proposed. It is a part of the legislative package required to implement the new departmental arrangements agreed in the statement issued on 18th December 1998 by the First and Deputy First Minister designate for Northern Ireland. The statement set out proposals for the re-structuring of Northern Ireland departments and the functions for which each department would be responsible. It was agreed that the number of departments in the new Northern Ireland Administration would increase from six to 10 and that existing responsibilities should be redistributed among these 10 departments.
Under the new arrangements, strategic planning is to become the responsibility of the new Department for Regional Development, and planning control the responsibility of the new Department for the Environment.
I explained that the order requires the Department for Regional Development to formulate a regional development strategy for Northern Ireland. I should also explain that much work has already been done in this regard by the existing Department for the Environment.

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In December 1998, it published for consultation a draft of a regional strategy which offered a framework for developing the region over the next 25 years. Responsibility for completing this exercise will now transfer to the Department for Regional Development.
Perhaps I may stress to the House that this is a project which I find very exciting. Indeed, it is one about which I am particularly enthusiastic. Therefore, I hope that the new Assembly will share the sense of enthusiasm I have towards this overall project. There are not many such examples of looking ahead involving local people in that process while covering a whole range of areas, of lifestyle, work, leisure, and so on, than one which looks ahead for 25 years. I believe it to be a remarkable undertaking. It has attracted a great deal of support across the whole of Northern Ireland.
The Government regard this exercise as essential for the future development of Northern Ireland. In the Belfast agreement of 10th April 1998, they gave a commitment to make rapid progress with a regional strategy so that it may be considered in due course by the Assembly. The Government saw the strategy as a means of tackling the problems of a divided society and social cohesion in urban, rural and border areas, protecting and enhancing the environment, producing new approaches to transport issues, strengthening the physical infrastructure of the region, developing the advantages and resources of rural areas, and rejuvenating major urban areas.
The order would also permit the Department for Regional Development to formulate sub-regional strategies as part of, or flowing from, the regional strategy.
A number of the provisions of the order are similar to those in the Planning (Northern Ireland) Order 1991 and we considered simply transferring these to the Department for Regional Development under the Transfer of Functions Order—a piece of subordinate legislation which redistributes the functions of the old departments. However, legal advice indicated that this could not be done as the new Department for the Environment will also need those provisions to carry out its planning control functions. An order was therefore necessary.
These provisions have also been strengthened through the introduction of Article 4, which places a statutory requirement on the Department for Regional Development to provide policy guidance and advice on the regional strategy and its implementation, to co-ordinate its implementation, and Article 5, which places a statutory requirement on other Northern Ireland and UK departments to have regard to the regional strategy when exercising any functions in relation to development in Northern Ireland.
I shall now summarise the provisions in the order. Articles 1 and 2 are introductory and deal with title, commencement and interpretation of the order. Article 1 provides that the order shall come into operation on the same day as Article 3(1) of the Departments (Northern Ireland) Order 1999 which relates to the creation of new departments including the
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Department for Regional Development. This would be a date appointed by the Secretary of State and would precede the day on which powers are devolved to the Northern Ireland Assembly by the Northern Ireland Act 1998.
Article 2 provides that the order should be construed as one with the Planning (Northern Ireland) Order 1991 for the purpose of interpreting meanings and definitions.
Article 3 requires the Department for Regional Development to formulate, in consultation with other NI departments, a regional development strategy for the long-term development of Northern Ireland. It also provides a saving clause to safeguard work already undertaken in this regard by the existing Department for the Environment. This article also empowers the Department for Regional Development to formulate sub-regional strategies as part of, or flowing from, the regional strategy.
Article 4 requires the department to provide policy guidance and advice in relation to the strategy and its implementation, and to co-ordinate its implementation. Article 5 requires all Northern Ireland and UK departments to have regard to the strategy when exercising any function in relation to development in Northern Ireland. Article 6 provides the department with the power to undertake surveys or studies for the purpose of exercising any of its functions under the order; it permits the department to consult with any persons it thinks fit for the purpose of exercising any of its functions under the order; and it also allows the department where it considers it appropriate to cause a public local inquiry to be held.
Article 7 provides the Minister for Regional Development with the power to appoint advisory bodies or committees to assist the department in the exercise of its functions under the order. Article 8 gives effect to the schedule and provides for consequential amendments.
The schedule to the order provides for consequential amendments to the Property (Northern Ireland) Order 1978 and the Planning (Northern Ireland) Order 1991.
This order permits work to continue on the completion of a regional development strategy for Northern Ireland—a strategy which the Government believe will enhance the lives and prosperity of the people of Northern Ireland. It is also important to give full effect to the new arrangements for devolved government in Northern Ireland. I beg to move.
Moved, That the draft order laid before the House on 22nd February be approved.—(Lord Dubs.)
Earl Attlee: My Lords, I am grateful to the Minister for explaining the order. I am reassured that the departments will look a long way ahead. The Minister will be relieved to hear that I do not propose to dissect the order, mainly because I am not able to. It will be interesting to see how it works, having two departments involved in the same business. Of course I know I shall have to be careful in that regard as I have just expressed

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that I am content to having two departments involved in the operation and regulation of the water industry. I am entirely content with the order.
Lord Molyneaux of Killead: My Lords, I shall follow the line taken by the noble Earl, Lord Attlee, and speak briefly at this stage. One accepts that redesigning and regrouping government departments is bound to cause a degree of confusion, at least in the short term. But can one assume that this order—providing, as it does, for strategic planning and regional planning—might have a bearing on the matter I mentioned during our debate on the appropriation order in regard to Belfast international airport? Is it possible to ensure that such a major project will not be delayed by any confusion that might be caused in the short term by the transfer of these powers? While I take the point made by the Minister with regard to factory development—which is part of this project—I trust that any difficulties and obstacles can be overcome.
Lord Dubs: My Lords, in answer to the question of the noble Lord, Lord Molyneaux, clearly these changes to the planning responsibilities are designed for when devolution has occurred. I see no reason why there should be any delay in dealing with planning applications of the kind described by the noble Lord at Aldergrove airport. I see no reason why there should be any delay when the Assembly takes over. We have all the procedures in place and the departmental structures will have been rearranged to comply with the new arrangements for 10 departments. I do not believe that there will be any delay. I trust that the Assembly will move forward quickly in making decisions of the kind we are talking about. At the moment we are in discussion with the developers about the difficulty which I described and to which the noble Lord referred. I hope those difficulties can be resolved quickly. I share the noble Lord's concern that major planning applications which have a bearing on employment prospects are important and offer an economic reward if they fit in with the planning system.
On Question, Motion agreed to.

Energy Efficiency (Northern Ireland) Order 1999
10.6 p.m.
Lord Dubs Lord Dubs rose to move, That the draft order laid before the House on 22nd February be approved.
The noble Lord said: My Lords, the purpose of the draft Energy Efficiency (Northern Ireland) Order 1999 is to provide a statutory basis for the promotion of energy efficiency in Northern Ireland. I believe it will be helpful to the House if I fill in the background to the preparation and drafting of the order.
Although departments in Northern Ireland have been actively promoting energy efficiency for quite some time, there has to date been only limited statutory authority for the expenditure involved. Consequently, parliamentary approval for this expenditure has been sought annually by way of the appropriation orders.
The Northern Ireland Audit Office indicated in a letter to the Department of Economic Development that this procedure should not be used in the long-term and that authority to incur expenditure should be defined by specific statute. An assurance was therefore given to the Northern Ireland Audit Office that the appropriate legislative cover would be obtained. This order seeks to fulfil that commitment.
The promotion of energy efficiency is an important government priority in Northern Ireland and I should like to explain how this policy is delivered. Until October 1997 energy efficiency was a matter exclusively for the Department of Economic Development. However, it was then decided—mainly due to the introduction of the Home Energy Conservation Act—that the responsibility for energy efficiency in residential accommodation should be transferred to the Department of the Environment. At the same time the opportunity was taken to transfer responsibility for promoting energy efficiency in government buildings, and in the public sector generally, to the DOE. The current arrangements for promoting energy efficiency are reflected in the terms of the draft order laid before the House.
The Department of Economic Development, through the Industrial Research and Technology Unit, promotes energy efficiency in industry and commerce; that is in Article 3. The department also promotes energy efficiency among voluntary organisations and community groups; that is in Article 4.
The Department of the Environment, through the Northern Ireland Housing Executive, is responsible for energy efficiency in residential accommodation; that is in Article 5. The DOE also has responsibility for promoting energy efficiency in the government estate and in other public bodies; and that is in Article 6.
The main provisions of the order are contained in four short and broadly similar articles dealing with the promotion of the efficient use of energy by industry, and voluntary organisations, in residential accommodation and by public bodies.
Each of these articles enables the relevant department to take such action as it considers appropriate to promote the efficient use of energy. The means by which that may be done include: the payment of grants or loans; the giving of advice; the dissemination of information; and the carrying out of research. The order does not place any new duties or requirements on businesses or individuals, nor will it give rise to increased public expenditure.
The promotion of energy efficiency in residential accommodation will also allow the Department of the Environment to focus on helping vulnerable groups in Northern Ireland such as the fuel poor. That will provide the department with the opportunity to promote fuel poverty schemes to improve the thermal efficiency of dwellings.
This is a short, non-controversial but necessary order which fills a gap in the current legislative provision with regard to the promotion of energy efficiency. I beg to move.
Moved, That the draft order laid before the House on 22nd February be approved.—(Lord Dubs.)
Earl Attlee: My Lords, I am grateful to the Minister for his explanation of the order. I wish to take this opportunity to salute the efforts of the noble Lord, Lord Ezra, in this area.
1 presume that the legislation follows similar legislation that obtains in the rest of the United Kingdom. I welcome the order and am content with it.
Lord Molyneaux of Killead: My Lords, I note that Articles 3 and 4 of the order refer to the Department of Economic Development and that that title also appears in the Explanatory Notes. During debate on 8th February (at col. 84 of Hansard) it was declared that the Department of Economic Development would become the Department of Enterprise, Trade and Investment.
I am not nit-picking, but in a previous incarnation I had the uncomfortable experience of being present on several occasions when Orders in Council were being considered and when, on the highest authority, an order was held to be invalid because one word had been wrongly inserted. Orders in Council cannot be amended. Are we therefore running into any difficulty by using the old name of the department when in the previous order its new name was used?
Lord Dubs: My Lords, first, I thank the noble Earl, Lord Attlee, for his positive support. I agree that the noble Lord, Lord Ezra, has made an important contribution in the whole area of energy efficiency. This House has had the benefit of the noble Lord's experience for many years.
The order provides coverage that is not required in Great Britain. because Northern Ireland has a more extensive promotional campaign in the domestic sector. So matters are not exactly the same as in Great Britain: in some respects we may have progressed further.
The noble Lord. Lord Molyneaux, was concerned about the use of a particular departmental name within the order. We are using the name of the department as it exists today. The order is therefore drafted in pre-devolution terms, so we have to use the term Department of Economic Development at the present time. However, the transfer of functions order will apply and will therefore take care of the change of name in the post-devolution situation from the old name to the new one. That is the proper way of doing it. We very much hope that devolution will take place over the next few weeks. In the meantime, we have to use the existing names of departments.
On Question, Motion agreed to.

Trade Union Subscription Deductions (Northern Ireland) Order 1999
10.14 p.m.
Lord Dubs Lord Dubs rose to move, That the draft order laid before the House on 22nd February be approved.
The noble Lord said: My Lords, the purpose of this order is to amend the law in Northern Ireland on trade union subscription deduction arrangements—a system known as "check off'—and to place it on the same footing as the law in Great Britain. The change to the law in Great Britain was effected by the Deregulation (Deduction from Pay of Union Subscriptions) Order 1998 which came into force on 23rd June 1998.
The relevant provisions are located in Articles 35 and 36 of the Trade Union and Labour Relations (Northern Ireland) Order 1995. These have been unpopular both with employers and trade unions because they impose unnecessary burdens and costs on them.
These burdens are eased by the order's provisions in two ways. First, the requirement on employers to obtain repeat authorisations from individual workers at least every three years, confirming their wish to continue paying their trade union subscriptions by "check off', is removed. Secondly, employers need not notify workers one month in advance if the amount to he deducted by "check off' is to increase.
These changes do not affect those aspects of the legislation on "check off' which provide necessary protection for workers. Written authorisations are still required from workers before deductions through "check off' can begin, and workers are free at any time to withdraw their authorisation if they so wish. Itemised pay statements under Article 40 of the Employment Rights (Northern Ireland) Order 1996 showing the amount of any deduction are still required to be provided by employers. These arrangements are considered by government to provide a sufficient safeguard to ensure that employees are informed about and in control of deductions from their pay.
While the order removes the burdensome aspects of the law on "check off' which are universally unpopular, it retains the necessary protections and freedoms for individuals to opt in and opt out of the "check off' arrangements on pay.
I commend the order to your Lordships. I beg to move.
Moved, That the draft order laid before the House on 22nd February be approved.—(Lord Dubs.)
Earl Attlee: My Lords. I am grateful to the Minister for his explanation of this order. We are entirely content with it because it reduces a burden on business.
Lord Molyneaux of Killead: My Lords, I. too, do not oppose the principle of the draft order, which fulfils a manifesto commitment made by the party now in government. It was endorsed by the electorate of England, Scotland and Wales. The party in government did not field candidates in Northern Ireland; therefore.

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those in Northern Ireland, particularly members of trade unions, did not have the opportunity to express their approval.
I wonder what the reason was for the intention originally to embody this clear-cut formula in what was called a composite order or, as the late Eric Heffer said, a composite Order in Council. Why was it intended to do that, rather than to repeat the same formula that was used in the rest of the United Kingdom, fulfilling as it did the clear-cut manifesto commitment? It may be difficult for the Minister to answer that, as he was not responsible, but it seems to be something of an anomaly. Maybe there is a message in that for the Assembly when it comes to do the work and tries to avoid the vital commitment in a composite order which, among other things, has no relationship to this particular item.
Lord Dubs: My Lords, I am grateful for the comments that have been made. On the specific point made by the noble Lord, Lord Molyneaux, I understand that it is not possible to legislate in Northern Ireland in the same way as it is in Great Britain. In Great Britain, under provisions in the Deregulation and Contracting Out Act 1994, the Secretary of State has power to make orders removing or reducing burdens on business. That power does not extend to Northern Ireland.
It had been planned to legislate by a deregulation Northern Ireland Order in Council. However, there was insufficient time to complete all the stages required for a deregulation measure containing a number of different issues before the transfer of power to the Assembly. Consultation took place on draft provisions dealing only with the trade union subscription deduction arrangements with a view to there being an early measure introduced by the Assembly.
Yet again, we have some differences in Northern Ireland, but I think we end up in the same place as in Great Britain. Provisions will be the same and businesses and employees will benefit similarly from this order.
On Question, Motion agreed to.

Northern Ireland (Modification of Enactments—No. 1) Order 1999
10.19 p.m.
Lord Dubs Lord Dubs rose to move, That the draft order laid before the House on 22nd February be approved [11th Report from the Joint Committee].
The noble Lord said: My Lords, as a result of the ongoing preparations for the future administration of Northern Ireland, following the Good Friday agreement, today I present the draft Northern Ireland (Modification of Enactments—No.1) Order 1999. This order seeks to modify the law and make other provisions consequent to the Northern Ireland Act 1998.
Essentially, the order makes provision for enactments which require amendment or repeal; transfer to the appropriate authority in Northern Ireland of powers currently vested in the Secretary of State which were historically vested in the Lord Lieutenant and the
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Governor of Northern Ireland, the gubernatorial powers; and provides for the continuation in law of statutory rules made in the weeks immediately before devolution but which, because of parliamentary procedure, are capable of being annulled after devolution by either the Assembly or at Westminster.
I now summarise the main provisions of the order. Article 1 is introductory and deals with the title, commencement and extent of the order. It will come into force on the day appointed for devolution. It applies the provisions of the order to Northern Ireland only, except as it relates to certain provisions of UK-wide enactments and to a provision in a Scottish enactment.
Article 2 gives effect to the amendment of various enactments specified in Schedule 1 to the order. This includes the transfer of powers of the former Governor of Northern Ireland relating to matters in the transferred field and which, during direct rule, are vested in the Secretary of State. Post-devolution these would go to either the First Minister/Deputy First Minister, the relevant departmental minister or the department concerned. Decisions on the level of the authority to exercise these powers have been taken on the basis of the importance, scope and nature of the subject matter.
If I could illustrate by means of examples, it might help to set the provisions in context. The Petroleum (Consolidation) Act (Northern Ireland) 1929 deals with the licensing and safe keeping of petroleum. It gives power to the governor, now transferred to the Secretary of State, to make Orders in Council applying the Act to other substances. The amendment being made would transfer the power to the Department of Enterprise, Trade and Investment, subject to that department's laying an order before the Assembly.
Similarly, in the Public Records Act (Northern Ireland) 1923, which provides for the Public Records Office for Northern Ireland, the governor had certain powers in relation to the printing and publication of records. These powers would now be transferred to the Minister of Culture, Arts and Leisure.
Finally, Article 7 of the Water and Sewerage Services (Northern Ireland) Order 1973 confers a power on the governor to make appointments to the Water Appeals Commission. This power would transfer to the First and Deputy First Ministers acting jointly so that the power is exercised in the transferred field but at a distance from direct responsibility for the service provision. This article also gives effect to repeals to the extent set out in Schedule 2.
Article 3 makes provision for statutory rules in passage when devolution comes into force. As I said, under normal parliamentary procedures such statutory rules are capable of being annulled, either by the Assembly or at Westminster, during that part of the statutory period which falls after devolution. Under Article 3 of the order, such statutory rules would be protected.
If I could set the provision in context, it might be helpful to your Lordships. As far as the Assembly is concerned, technically a statutory rule, which is subject to negative resolution procedure and made before devolution, would be laid before the Assembly. If within

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a statutory period (30 days minimum) the Assembly resolves that it be annulled, the rule would become void from that time.
As a matter of constitutional propriety, the Assembly should not be in a position post devolution to annul statutory rules which have been made under direct rule in the period immediately before devolution. It could, of course, revoke the rule in question after devolution by making a new rule if it so wishes. I should explain that this aspect of Article 3 is not new but largely re-enacts provisions contained in the Northern Ireland Act 1974.
Similarly, it would not he appropriate for Westminster to debate a statutory rule on a transferred matter, subject to negative resolution procedure, after devolution. Once again, the rule could be subject to annulment after devolution because the statutory period of 40 days had not expired on devolution day. For these reasons the provisions of Article 3 are necessary.
Article 4 applies the provisions of the Documentary Evidence Act 1868, as amended in 1882, to documents issued under the authority of the First Minister and the Deputy First Minister. This means, in effect, that an official document authorised by the First Minister and the Deputy First Minister acting jointly can be admitted in court proceedings as conclusive evidence of such a document.
Article 5 ensures that any subordinate legislation already made by, or anything done under, the enactments which would be amended by this order will continue to have effect after devolution. It also takes
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account of the provisions of Section 95(5) of and Schedule 12 to the Northern Ireland Act 1998. That schedule provides for certain references in existing laws to continue to have effect following devolution. For example, a reference in existing law to laying a document before the "Parliament of Northern Ireland" will in the post-devolution context be read as a reference to laying a document before the Northern Ireland Assembly. Article 5 makes it clear that the amendments contained in Schedule 1 to this order do not prejudice the operation of those provisions. A comprehensive consultation paper on the proposals on which this order is based, followed by a draft of the order itself, was circulated to, and considered by, the First and Deputy First Ministers (designate). The draft order was also circulated to the Northern Ireland party leaders.
This order complements the other legislation giving full effect to the new arrangements for the future government of Northern Ireland as a result of the Good Friday agreement and as such is a necessary part of it. I beg to move.
Moved, That the draft order laid before the House on 22nd February be approved [11th Report from the Joint Committee].—(Lord Dubs.)
Earl Attlee: My Lords, I am grateful to the noble Lord for that explanation. Despite the complexities of the order—it is a technical matter—I am entirely content with it.
On Question, Motion agreed to.
House adjourned at twenty-five minutes past ten o'clock.