Lords Sitting of 14 July 2000

Preamble
The House met at eleven of the clock: The CHAIRMAN OF COMMITTEES on the Woolsack.
Prayers—Read by the Lord Bishop of Gloucester.

Carers and Disabled Children Bill
Baroness Pitkeathley: My Lords, I understand that no amendments have been set down to this Bill and that no noble Lord has indicated a wish to move a manuscript amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the order of commitment be discharged.
Moved, That the order of commitment be discharged.—(Baroness Pitkeathley.)
On Question, Motion agreed to.

World Trade Organisation: EUC Report
11.7 a.m.
Lord Tomlinson Lord Tomlinson rose to move, That this House takes note of the report of the European Union Committee on the World Trade Organisation: the EU mandate after Seattle (10th Report, HL Paper 76).
The noble Lord said: My Lords, the third ministerial conference of the WTO was held in Seattle last November. It had limited objectives: to set the agenda for a new round of negotiations planned for earlier this year and to establish a motive for the suggested—perhaps optimistic—title of the millennium round. Instead, as I believe most noble Lords will be aware, the conference broke up in chaos with no agreement amid many recriminations and enormous publicity, most of it negative.
Although the United Kingdom is a WTO member, the Council of Ministers of the European Union fixes the negotiating mandate and the Commission negotiates on the basis of that mandate. It was therefore appropriate for the European Select Committee to take stock of the mandate, especially in the context of efforts made by many to sketch out a way forward—efforts that led to a WTO council meeting in early May this year. It is that report which today I commend to noble Lords and of which I ask them to take note.
At the outset, I pay a heartfelt and sincere tribute to our Clerk, Dr Elizabeth Hopkins, without whose skill and dedication the report would lack many of the qualities that I believe it contains. We have come to expect intellectual rigour and endeavour from our Clerks, but we have no right to expect the excessive hours and weekend efforts without which the committee's efforts would have been to much less avail and without which I doubt whether the report would have been ready for debate today. In this case, the burden was magnified because we did not appoint a
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specialist adviser. It was almost impossible to contemplate a specialist adviser who would not take one side or the other in the general argument concerning the WTO. The burdens of work also fell on Helen McMurdo, to whom I express my and the committee's gratitude.
I wish to make a general point with regard to such efforts because noble Lords refer frequently—as I myself have done—to the lack of facilities in your Lordships' House. I believe that we should make clear that that applies quantitatively but definitely not qualitatively to our committee Clerks as a whole.
I thank our many witnesses, and thank also the WTO ambassadors whom we had the opportunity to meet informally in Geneva. I express special thanks to Dr David Vines, Dr David Evans and my noble friend Professor Lord Desai for giving the committee the benefit of their substantial economic talents and advice. They were of great help, enabling us to clarify our minds on some of the economic issues involved in the discussions.
In the limited time available today, it is quite impossible to do full justice to the report. It is almost impossible even to explain fully the summary of the report. It is a big report, and one for which much evidence was taken. The written evidence and transcripts in total amount to some 300 pages.
In our approach to the subject, we began from first principles: are the Government and the European Union right to support increasing trade liberalisation? The committee concluded that they are right and that they are right to emphasise certain provisos. Liberalisation should be within a rules-based system, such as that provided by the World Trade Organisation. Liberalisation should not be a process considered in isolation from other issues. We were particularly concerned, for example, that environment and development considerations should be engaged in the process of liberalisation.
The rules of the system should be observed not only by companies and their governments, but by large multinational companies. The system needs to ensure that the poor as well as the rich stand to benefit from the development of liberalisation. We therefore agree with the assumptions of the European Union mandate that globalisation accentuates the need for a rules-based framework, that trade liberalisation needs to be considered with other issues and that the WTO needs to work in co-operation with other international institutions.
It was important that the inquiry should not just be a post mortem on Seattle. We need to understand clearly what went wrong there to consider what lessons the Government and the European Union should learn for the future. We concluded that the main problem was a lack of proper preparation to narrow the issues down for debate. In addition, there was a clear view in the committee that the hosting of the conference by the United States when an election was coming up did not help the process of resolving the agenda questions.
There was also substantial insensitivity in the handling of developing countries who had come to that ministerial conference with high expectations as relatively new members of the WTO. Almost in parentheses, I might add that some of the demonstrations outside the building did not help the process of deliberation inside.
A lot of work is needed before the next conference. That will involve extensive bilateral contact, promoting the role of the developing countries to make sure that they feel fully involved and increasing transparency to get a better understanding of what the WTO is seeking to do. In that context, having spent some time in discussion with the WTO secretariat and looking at its facilities, it was the view of the committee that the secretariat needs to be properly resourced and perhaps given a more formal power of initiative to get things moving when negotiations are deadlocked.
Part 5 of the report relates to the EU's approach to issues of substance. We reached the clear conclusion that the EU is right to maintain the principle that the agenda for the next round should be comprehensive. That is necessary to ensure that there is scope for trade-off in the negotiations. The execution of that mandate by the Commission, as the negotiator for the European Union, will need to be flexible.
We also emphasised that any comprehensive agenda must involve agriculture, and that must entail a willingness and ability in the mandate to negotiate major, fundamental reform of the common agricultural policy. I shall not burden your Lordships by going through the arguments that have previously been made, but every report from the European Select Committee relating to agriculture has dealt in full with the need for comprehensive reform.
We must also ensure that the next round is a development round. Developing countries must be offered better market access and better resources to ensure the capacity-building that is so often referred to. Those resources must be available through the WTO. We were pleased to see that some of the capacity-building measures that we had in mind were being developed with the advisory centre on WTO law to ensure that there was equal access to legal expertise for all countries engaged in legal discussion on WTO issues.
We also strongly believed that the European Union needs to review its mandate at ministerial level, not merely in its 133 Committee—a committee of officials that has reviewed the mandate on several occasions. As the negotiations had broken down, a review of the mandate was necessary. A failure to do so would reinforce other countries' perceptions of the intransigence of the European Union in pursuit of its mandate. Ministers should have been seen to be concerned about the views of others. If changes to the mandate were found necessary, they could have made them. If no change was necessary, they could have confirmed the mandate.
The committee looked at a number of specific aspects of the mandate. Regulation on trade in services can easily be used as a protectionist measure. But we agree that the mandate for further liberalisation in that area is vital. However, we suggest that that is best achieved by continuing the approach approved by the general agreement on trading services whereby countries opt into agreements.
Moving on from trading services, we turned to the whole question of investment and competition rules which are clearly linked. It is a statement almost of the obvious to say that there is no realistic expectation of agreement on either. The EU mandate may well be too optimistic but the subject area is important and negotiations should begin.
In that regard, we could perhaps adopt the opting-in approach which has existed in relation to the EU services. But two things need to be clearly understood: first, that progress will be slow; and secondly, that that slowness should not be used as an alibi to hold up progress in other areas.
I turn to intellectual property. The mandate of the European Union is somewhat non-committal. We clearly support the universal application of patent law. We recognise the challenges that that poses to many developing countries. We should strenuously encourage the possibility of companies granting exemptions from their patent on humanitarian grounds.
For example, we were very much encouraged by the example of some United States pharmaceutical companies in making concessions to developing countries on humanitarian grounds. We believe that that could be emulated by European Union countries. Let us look at a matter which has greatly concerned your Lordships' House; namely, the spread of AIDS in sub-Saharan Africa. It is probably by United States and European pharmaceutical companies acting in unison and making concessions to patent law—which we believe must be observed—which will make the necessary contribution to the eradication of that problem.
We dealt also with environmental issues, which are extremely complex. Increasing trade can and should be compatible with sustainable development. Among our recommendations are those which say that the European Union should make firm proposals on adopting WTO rules to allow multilateral environmental agreements and also that governments should be allowed to make eco-labelling mandatory.
We also applaud the European Union for having prompted WTO discussions on the precautionary principle but we chose not to venture too far into that complex area.
Core labour standards have been clearly defined and agreed by the member countries of the International Labour Organisation. Although we had extremely lengthy discussions in that area, there was clear support for the European Union proposal for an early ministerial meeting which should involve other

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international bodies such as the International Labour Organisation and UNCTAD. It is in those fora that the way forward should be considered.
Of the other issues on the agenda, the most important was to look at the dispute settlement procedure. Dispute settlement is an important and necessary element in any rules-based system. Our examination of its application in the now notorious banana dispute shows the need for change to ensure that the system is fair to all. We believe that the European Union must take a lead in pressing that case for change in the disputes resolution procedure.
Looking at the way forward, the major concern is to ensure that the next ministerial conference succeeds in agreeing a sensible agenda. Therefore, European Union countries must lead the developed countries in offering some real concessions to the developing countries to show that trade liberalisation is in their interests.
The package which was produced by Ministers in the WTO at their May meeting is just not good enough. The European Union should insist that enough time is given to prepare the next ministerial conference. It was because of the unwillingness to observe the time necessary for preparation that we use a very strong form of words in one of our conclusions. This states:
"We deplore the agreement reached by the EU and the US on 30 May to try to launch a new Round during the course of this year. It is much more important to get it right than to get it soon".
The future liberalisation of world trade stands to benefit poor as well as rich countries. It is as important an issue as any on the world agenda. Seattle was a shame to us all and a fiasco. Nobody can afford another such failure. I believe that its consequences would be disastrous to developed and developing countries alike. I beg to move.
Moved, That this House takes note of the report of the European Union Committee on the World Trade Organisation: the EU mandate after Seattle (10th Report, HL Paper 76).—(Lord Tomlinson.)
11.26 a.m.
Lord Biffen: My Lords, the noble Lord, Lord Tomlinson, has moved the Motion with customary skill, diplomacy and persuasiveness. That is only right and proper given the very distinguished service he received from the Clerk to the committee and, indeed, the membership of the committee.
My remarks will be brief and I shall cast a slightly sceptical eye over some of the provisions and implications. But I do so, having regard to the noble Baroness, Lady Williams of Crosby, in wishing to quote from an old Liberal slogan which was that if trade cannot cross frontiers, armies will. Of course, there is that lingering philosophy that somehow or other, broad and free trade could avoid conflicts which otherwise led to war. I hope that there is some truth in that, but there is plenty of evidence to suggest that there are other interpretations as to what leads to conflict.
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What has been so well elaborated in the report is an extension of the philosophy that growing international trade, and not just tariff reduction but trade intervention, will be broadly beneficial for the world community. That is a fairly heroic judgment. But I cannot deny that what is being proposed is a massive extension of intergovernmental intervention.
If GATT has been a success over the years since 1948, I suspect it was largely because it was passive in its operation. It did not seek to prescribe a whole set of behaviours which were extremely germane to domestic politics and interests.
All that is now subjected to question by the noble Lord, Lord Tomlinson, and his committee. The noble Lord, Lord Tomlinson, accepted that there would be a rules-based regime extending to agriculture. There is the habitual cheer for the prospect of reformation of the common agricultural policy. If reforming the agricultural policy depended upon cheers in parliamentary assemblies, it would have been reformed years ago. The truth is that it represents innate national interest which would be defended furiously and whose defence could easily prejudice the wider case for international free trade.
I shall give one pointer. On the issue of GM crops, if Asian countries are likely to develop GM crops— China is a case in point—surely it will not be long before they will be in a position to export to the western world, including to the United Kingdom, where it is likely—I put it no higher—that there will be strong, restrictive arrangements on the use of GM crops. Quite unintentionally, we may find ourselves moving towards a conflict situation, whereas on the whole we are seeking general agreement.
If agriculture is parochially tossed in as the first line of expansion for the World Trade Organisation, it could be followed by services, investment, competition rules, the environment, technology and labour standards, none of which is on the immediate agenda, but we have been served notice that ultimately it is intended to put them on the agenda. If they are not required to be on the agenda by this country with our interests, they will certainly be put on the agenda by other countries with their interests.
Perhaps I may be allowed to draw an analogy, although I do not want to raise the temperature by involving the European Union. It is as though one has taken the Treaty of Rome on tariff reduction and elimination and compared it with the single market. The single market is full of intervention, control and regulation. I do not argue for or against it, but I am saying that we should recognise that there is a sea-change between tariff reduction and what is now being proposed as part of the extended role of the World Trade Organisation.
I believe that that collides with other interests. One is the extent to which there is an expectation that cannot be fulfilled, a shopping list of the World Trade Organisation that has been elaborated on by the noble Lord, Lord Tomlinson, and myself, which must lead to a belief that that will have a substantial and transforming effect upon the world economy. Indeed,

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that was on the lips of many of those who demonstrated in Seattle. They were not there as minimalists; they believed that they saw an evolution that required their radical presence to secure the aims that they had in mind.
I wonder whether really substantial, radical change can possibly be produced by these measures. In the report, on page 10, I was interested to read what was said by Dr David Evans of the Institute of Development Studies at the University of Sussex—not an area that I would look to for support of my own prejudice. He said:
"little is known at present about where and by how much trade liberalisation will contribute to poverty alleviation, and where it may even help those in poverty".
It is just as well that we understand that, with our rhetoric, we are setting an expectation that may well not be fulfilled by what is secured. More chilling is the thought of what we try to do about the structure that is now proposed. Who will be the agencies? Who will enforce the regulations? What will the sanctions be and to what extent will they be rooted in public acceptability?
I see in heavy print in the report the comment that,
"The world therefore needs an international organisation to agree the principles on which the rules are to be based, and to set and police the rules".
We all want to see a harmonious relationship between the countries of the globe; we certainly want there to be a harmonious relationship between the developing countries and those of Western Europe and North America. However, I am not persuaded that this degree of proposed intervention and control, which will be political and not economic, will bring about what is sought by the enthusiasts for the World Trade Organisation. Therefore, I am minimalist in my reaction to these challenges. I hope that we can continue to develop the World Trade Organisation as an extension of GATT, but that we will not fall for an ever-increasing involvement of international authorities in the administration, policies and domestic judgments of nation states, for in that way we shall pay the penalty for the folly of assuming that public contentment is derived from internationalisation.
11.35 a.m.
Lord Parekh: My Lords, although I am a university professor and was once, for my sins, a vice-chancellor. I must confess to a considerable sense of diffidence in rising to deliver my maiden speech. That is partly because I am in the midst of many noble Lords whom, over the years, I have greatly admired and whose wisdom and courage have long been a source of inspiration to me. The diffidence is also caused by the fact that the six weeks in which I have been a Member of your Lordships' House have triggered a complex cluster of emotions that I have not been able to analyse and fully integrate.
I was born and spent the formative years of my life in the shadow of British rule in India. Several Members of your Lordships' House governed my
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country with great wisdom and humility; others left something to be desired. Naturally, they provoked a wide variety of reactions such as admiration, gratitude, anger and resentment. Like all other Indians of my generation, I grew up with those emotions. I am now a Member of your Lordships House, a recipient of noble Lords' kindness and generosity and I find myself building up an entirely different relationship compared with my own history and the history of your Lordships' House.
When, several decades ago, I first came to Britain, the country most generously gave me all the rights of citizenship, including the right to vote. I am now told that I can no longer exercise that right to vote and do not perhaps even enjoy it. As if to compensate for that act of disenfranchisement, I am now supposed to be entitled to a new kind of passport which presumably brings certain privileges in its train.
The staff, with their amazing memory for names, have been extremely kind and helpful and I am grateful to them all. Their most generous and constant invocation of my lordly status, however, has tended to give me a rather exaggerated sense of my own importance. Sometimes it is a bit of a let down to venture into the wider world and find that it takes a rather different view of oneself because of its legitimate commitment to democratic equality.
In short, the past few weeks have been full of paradoxes and ambivalences. As I am still struggling to resolve the conflicting logics, I hope that noble Lords will forgive me if my brief remarks on the subject of the EU mandate fail to meet your Lordships' highest standards.
The World Trade Organisation is an excellent instrument of international economic co-operation. It is rightly committed to the view that free trade benefits all and that trade barriers should be reduced and. ideally, removed altogether. Unlike the International Monetary Fund and the United Nations with its Security Council, the WTO treats all its members equally and gives them a more or less equal say in the determination of its policies. It even requires the United States to accept its rigorous trade discipline.
Therefore, the WTO has rightly come to enjoy considerable procedural legitimacy, but if it is to enjoy substantive legitimacy and command the enthusiastic support of not only governments but also NGOs and ordinary citizens the world over, it needs to ensure that its framework of rules benefits all its members equally and promotes their well-being. If it is to do that it needs to bear in mind certain principles. I would like to mention five which, in my view, are critically important and have not always received the attention that they deserve.
Some of those principles have been rightly stressed by the excellent Select Committee report we are now considering and which was introduced by my noble friend Lord Tomlinson. But they can do with some degree of reiteration. First, since not all economies are equally developed, obviously they are not equally equipped to benefit from free trade. To treat unequals uniformly is to treat them unequally and unjustly. It is

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therefore vital that the competitive capabilities of developing countries be strengthened, so that they can take full advantage of trading opportunities. That involves building up their educational, social, technological, financial and economic infrastructures and giving the WTO's work a developmental orientation. Trade is not an end in itself; it is merely a means. It is an important means, but nevertheless, just a means. It needs to be located in the larger framework of economic development.
Secondly, if free trade is to deliver on its promise, it needs to secure certain conditions, one of the most important, in my view, being the stabilisation of currency movements. Without that stabilisation and without the mechanism for it, the economies of developing countries can be easily destabilised, as we saw not so long ago in the case of east Asia. If that happens, those countries lose both the willingness and the ability to benefit from international trade. It is no use having a regulatory framework for trade but none at all for currency transactions.
Thirdly, if international trade is to work to the advantage of all, developed countries must stop protecting some of their industries, especially those which are of vital importance to developing countries, particularly agriculture and textiles. There is therefore little to be said for the EU common agricultural policy. That not only places the agricultural imports from developing countries at a disadvantage, but also weakens the EU's own ability to persuade developing countries to open up their markets. Britain should therefore take a lead in persuading our partners to rethink that policy.
Fourthly, the social clause, which relates to child labour and other components of the productive process, is a double-edged weapon. It can ensure uniformity and eliminate obvious social evils in developing countries. But it can also become both a protectionist device and a subtle tool of subverting developing economies. The social clause therefore needs to be interpreted and applied in a culturally sensitive manner and should be based on the willing, uncoerced consent of developing countries.
Fifthly, and finally, no trade is culturally neutral. We cannot talk about trade as though it was purely an economic and unculturally-related activity, because no commodity is culturally neutral. Free trade therefore can easily become a vehicle for transforming not only the economic but also the cultural lives of the societies involved. Even the culturally confident French have shown deep worries about the increasing Americanisation of their way of life. The fear is even greater, deeper and more extensive in developing countries, many of whom panic at the prospect of the subtle and relentless transformation of their ways of life and cultural identities. That has sometimes led to cultural and religious fundamentalism, which is an incoherent and dangerous but nevertheless understandable response to the remorseless and relentless logic of globalisation.
We therefore need to view their anxieties with compassion and charity, and ensure that the framework of trade that we design allows all countries,
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especially the developing ones, adequate breathing space, some control over their cultural affairs and the opportunity to adjust to the logic of globalisation at their own pace and in a manner which is best suited to their own traditions. Cultures are not commodities and cultural products require a different regime of control to that which is suited to what I might call material commodities. The WTO's tendency to treat all commodities uniformly as if they were all the same needs to be reformed.
Therefore, if we wish to avert moral and cultural panic and the consequent emergence of self-defeating fundamentalism in developing societies, we need to show a greater appreciation of the dilemmas and anxieties of developing countries than the WTO has done so far.
I thank noble Lords for their patience and for granting me a few early moments of self-indulgence.
11.44 a.m.
Baroness Sharp of Guildford: My Lords, on behalf of the House I congratulate the noble Lord, Lord Parekh, on his excellent, amusing and insightful maiden speech. I am glad that he mentioned the issue of currency stability because it was not an issue covered in our report. I was a member of the Select Committee which put the report together. The noble Lord is absolutely right that it is an essential factor if we want to carry forward free trade; it is an essential concomitant of carrying that agenda forward.
As the noble Lord implied, he has had a long and, if I might say so, distinguished career in academia both here in Britain and in India, Canada and the United States. He has written extensively on political philosophy and on social and political thought. He has also contributed his time and energy to promoting equal opportunities for ethnic minorities in this country. We welcome the noble Lord to this House. We look forward to benefiting from his wisdom and breadth of knowledge and to enjoying contributions of the calibre he has made today.
As a member of Select Committee A responsible for this report, I am delighted that so many of those who have read it regard it so highly. A number of people have said what an excellent report it is. Credit is due, as the noble Lord, Lord Tomlinson, said, very much to our Clerk, Dr Elizabeth Hopkins, who both guided our deliberations and gave shape and substance to our conclusions.
I must also declare another interest. Forty years ago, on graduating from Cambridge, I joined what was then the Board of Trade and, as one of those allocated to the trade policy division, was initiated in the rites of the GATT, which was and remains in many respects the Holy Grail of that side of the department. During that period I had the privilege of being set to read some of the Bretton Woods paper. I was in fact researching commodity policy and Keynes's notion of setting up an international buffer scheme—Commod—to limit the swings of commodity prices.
I learnt both of the high hopes in 1945 that the world would establish an international trade organisation to regulate trade between nations and of the dashing of

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those hopes and the establishment instead, under the Havana Treaty, of the General Agreement on Tariffs and Trade, built upon the twin principles of reciprocity, in terms of most-favoured nation treatment, and consensus, and moving forward little by little.
At that time, in 1960, the GATT's second round, the Dillon Round, had just been completed. Had I remained within the department it is quite possible that at some point I would have had responsibility for carrying forward the Holy Grail through one of the subsequent GATT rounds. As it was, I did the next best thing by marrying one of the troubadours whose task it was to do so through the latter stages of the Tokyo Round. As a result I have been and remain perhaps more conscious than most of how much has been achieved over the course of the years by this gradual moving forward. I call it the "shuffle, shuffle, one-step" process of the GATT. The need to move by consensus meant inordinately long rounds of negotiation, of consensus building, capped by the often quite sudden emergence of consensus and therefore the one-step completion of the round.
Forty years ago, in 1960, I was negotiating the reduction of quota restrictions on imports into the UK. Tariffs on motorcars and many other luxury goods were then at around 40 per cent. By the end of the 1980s, and as a result of the Kennedy and Tokyo rounds, tariffs on most manufactured goods were close to zero and the Uruguay Round saw the opening up of new areas—trade in services, investment, intellectual property and, for the first time, agriculture.
We should not underestimate the benefits from the reduction in tariffs on manufactures for it fuelled the very fast rise in international trade between developed nations and also opened the door to imports from countries such as South Korea, Taiwan, Malaysia and the Philippines and enabled what were, in the 1970s, called the "newly industrialising countries" of south-east Asia to become sophisticated players within a now global structure of trade. What we now call globalisation has in many respects been the outcome of this long process of trade liberalisation.
It is that heritage—the rooting in the long, slow processes of reciprocity and consensus building that characterised the GATT—which gave me an interest in the WTO. I welcomed this inquiry as a chance to update my knowledge. Superficially, I approached it somewhat apprehensively. What had gone wrong? Why had a seemingly even-handed organisation such as the GATT, or so it appeared, become the handmaiden to the more strident American view of free trade, which was riding roughshod over environmental and social concerns?
I have to say that this inquiry has renewed my faith and reassured me that, despite glitches, the project is still on course and that the process is the right one. I had not realised that from the 30 or so members of the GATT in 1960 there are now 136 members, the
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majority of which are developing or newly-industrialised nations. This is important because, as Mr Stoler, the deputy director-general at the WTO, reminded us:
"Any country can join any UN agency if they agree to pay the dues. There is a different admission price here … Entry is not cost free … You have to have an economy and a set of rules in that economy".
In other words, as a member, you have to adhere to the rules that are set and, above all, adhere to the central rules of reciprocity and consensus.
But, inevitably, with 136 members the process of consensus building is more complex. What sank any chance of agreement at Seattle was not the presence of the NGOs and the street battles against capitalism, but the internal failure of the system to arrive at consensus. The reasons for this are various and are set out in our report—the failure to appoint a new director-general on time and the lengthy wrangling over his appointment, the insensitivities of the US as a host nation, organiser and chair for the whole occasion and the intransigence of the EU on agriculture. Indeed, the list is long. But fundamentally it was the fact that not enough time and effort had gone into building the underlying consensus among the nations that was necessary if the business was to proceed and succeed.
As became clear from our discussions, the WTO cannot afford another disaster like Seattle. Although rooted in the GATT, it is still a new organisation and, as such, still fragile. As a new organisation in the new globalised world in which we live, it is also pioneering new forms of governance. The dispute settlement procedures are new and unique, but it is very important that they succeed and that they gain credibility. This means, I believe, that we must face up to the issues posed by potential conflicts—for example, the environmental objectives of the multilateral environmental agreements—and seek reconciliation within the system. The same applies to poverty and social issues. I find it very difficult to accept that the EU cannot discriminate in favour of the small banana growers in the Caribbean. However, if the WTO fails, we must be aware that there is a great danger that cowboy capitalism rather than rule-based capitalism will win the day.
It was significant that it was one of the WTO's deputy directors from a developing country, Mr Onedraogo (a previous Minister in Burkina Faso) who said:
"The world is lucky enough to have these rules set up within the framework of the WTO protecting small, big, rich and poor countries. Otherwise we would have been in the jungle".
He made it clear that small, poor countries such as his would be the losers in such a jungle. As Clare Short said clearly:
"The rhetoric of the protestors is entirely the wrong way round. It is the developing countries that need the rules-based institutions … more than the developed and wealthy industrialised nations. There is a sense across the world of fear of globalisation".
Perhaps I may take up this idea of fear of globalisation. Just to reiterate, my argument to date is as follows: first, that trade liberalisation under the GATT has brought great benefits both to the

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developed and to the developing world. Secondly, among other things, it has helped to unleash the forces of globalisation; and, thirdly, in a world of globalisation it is jungle warfare in which the biggest and the strongest companies and countries will win unless there is an agreed set of rules under which those companies and those countries agree to operate. The WTO provides such a set of rules. Therefore, it is vital that we strengthen and support such rules rather than cast them aside.
The danger with another Seattle-type fiasco is that the WTO loses all credibility and is, in effect, cast aside in favour of other approaches. But for any other approach to work and succeed, it must carry those same fundamental principles of reciprocity and consensus. It seems futile to risk throwing away all that has been built up over the past 50 years. That is why, at the end of the day, the advice in our report to the EU as regards its approach to these negotiations is that, first, it must not be too ambitious. Its mandate argued for negotiations across a broad agenda, but it would not matter if the issues such as investment and intellectual property were cut out.
Secondly, the EU must recognise that as the system expands so new support mechanisms will be required. We put great emphasis in our report on the need for capacity building among developing countries. But perhaps we should also be thinking about the breadth of the agenda. I shall quote your Lordships just one example—the TRIPS agenda and patenting. Can we really expect developing countries to be able to set up their own patent offices and police their own patent system?
Thirdly, we advise the EU to recognise that it has to give as well as take. In particular, it must be prepared to negotiate on two issues that are of considerable importance to developing countries—namely, agriculture and textiles. Finally, it has to be patient. It should riot try to push the process too fast. It must allow time for consensus building. As the noble Lord, Lord Tomlinson, implied, we were horrified to learn that, at the last summit in June, the EU and the US were of the opinion that they could resurrect the negotiations and move forward within the next six months. We believe that that would be very dangerous. We do not advise the EU to go in that direction.
11.57 a.m.
Lord Lea of Crondall: My Lords, before I address some of the issues raised in the report, I should like to echo what our chairman, my noble friend Lord Tomlinson, said about the contribution made by our Clerk, Dr Elizabeth Hopkins, and add a few remarks to what has been said. She maintained her unflappability through various difficulties, including rescheduling our visit to Geneva to meet the requirements of the Whips. Her technical excellence and speed of delivery was a tower of strength and I am sure that that has maintained the reputation of the committee as one which produces reports of the highest standard. Indeed, I am sure that our report will influence the EU and WTO debate as it moves forward.
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Although we do not say it in quite so many words, I believe, reading between the lines, that we found the EU mandate, which is the basis of the report—each section is built around a quote from the EU mandate—had not only been very well put together but had also stood the test of detailed inspection by the committee. However, as my noble friend Lord Tomlinson said, we make the comment that the EU should not perhaps have simply reiterated the mandate, but that may be a presentational objection to something that was drawn up a year ago. But, as I said, it stood the test of our scrutiny.
I draw attention to the fact—I believe that this is stated somewhere in the report—that no other country has put its cards on the table in the same way as the EU. That is a strength. Sometimes the EU has been criticised for a lack of transparency. However, if that remark was made in connection with the matter we are discussing, it would be 180 degrees the opposite of the truth. It is more a case of living in a goldfish bowl. In terms of setting out agendas for consideration, the EU has again proved its indispensability as an international network. Can one imagine getting anywhere at all without such a structured approach? Would any British government, left to their own devices, have produced such an explicit and public mandate? I am sure that they would not have done.
The WTO is intergovernmental and is made up of constituencies which comprise member states. That is a fairly obvious, even trite, remark, but I think that it has consequences in terms of whether we can, as it were, carry out other people's negotiations for them. Sometimes the positions which are adopted are negotiating positions adopted in the expectation of multiple trade-offs in negotiations. This presents some difficulties. The report contains a section on the workings of the WTO secretariat within the system. We call for some revisiting of the power of initiative to the Director-General. If we had started from scratch, we probably would not have had the present arrangements. We would have probably incorporated the WTO within the UN system. Part of the rationale for it not being part of the UN system is that not everyone belongs to it. That obviously cuts both ways. I take the example of the relationship between trade and development. The United Nations Conference on Trade and Development—UNCTAD—is a UN body which perhaps produces an inadequate interface.
I take the example of China and the WTO. One can argue that China is open to influence through being part of the system. That relates to the question of the so-called "democratic deficit". I do not think that there would be argument about democratic deficit if the WTO were more obviously part of the UN system. We comment on page 28 of the report that the WTO secretariat is not even in the position of the typical UN secretariat in being able to table papers in the name of the Secretary-General. That may have been a factor at Seattle, but for the future we should at least consider how we give some greater degree of initiative to the Secretary-General in the WTO system.

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It has become commonplace that we need a rules-based system. However, in some areas we are moving in a rather different direction. I believe that this is true of the area of direct investment. I refer to multinational corporations in this regard. A major opportunity was lost in the 1970s when an unholy alliance of Moscow and Washington forced the breakdown of a comprehensive negotiation through the UN Commission on Transnational Corporations, to which I was an expert adviser. The Americans said, "Hands off" and the Russians said that socialist enterprises should not be covered. The Indian delegation, the Brazilian delegation and other major G77 countries most regretted that outcome. We are now picking up some of those ideas again but in the framework of bilateral negotiations. One might ask what could be fairer than that. However, in a world of bilateral negotiations between rather unequal parties, it all depends who is the stronger. As people used to say in the field of industrial arbitration, "The lion's share goes to the lion".
As regards dispute settlement, it is surely disproportionate for the US to introduce trade sanctions via 100 per cent tariffs on folded cartons to apply pressure in seeking a solution to the banana dispute. We recall from Gilbert and Sullivan that the punishment should fit the crime. However, I cannot see that being the case in the banana dispute where a totally unconnected party considers it perfectly all right to slap on 100 per cent tariffs as part of the WTO sanctions procedure.
I do not believe that my next point has been mentioned. We should not too readily criticise the EU for saying that the WTO should require the elimination of "essentially all" rather than "all" preferential arrangements when we, DfID and everyone else knows that there are two or three instances—bananas comprise one of them—where the issue is a little more tricky.
It is well known that the CAP was devised before we joined the Community. I say to the noble Lord, Lord Biffen, that I hope that we are not about to make the same mistake in terms of our membership of the euro. Do we not engage in too much simple breast beating about the CAP? It is a fact that the first step towards dismantling the old-style CAP was taken in 1992 with the MacSharry reforms when the elements of market support were reduced for some products and farmers were compensated by direct grants. In recent years support prices have been frozen or reduced, while milk output has been controlled by quota and some land has been taken out of production through set-aside. There are now no mountains of intervention stock. Currently, for example, we have about 19 days' supply of wheat.
In 1997, in the perspective of a further major enlargement of the European Union, the Commission—which with Britain has been the main promoter of agricultural policy reform—proposed more changes in its document, Agenda 2000. On the basis of that the Heads of State and Government decided at Berlin in March 1999 substantial extra
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reforms. The main elements are price cuts; part compensation to farmers by direct grants; stronger measures in favour of the environment and wider rural development plans. In particular, support prices for wheat and other cereals will be cut by a further 15 per cent beginning this month. The support price for beef will be cut by 20 per cent over three years. However, we need to go further and no doubt we shall as the discussions on enlargement progress.
The report states that much ground needs to be covered on a number of matters before a full scale round takes place. The relationship between trade and labour standards is a good example of that principle. We support the creative proposal—this is covered in the report on pages 59 to 63—that the EU should urge the convening of a ministerial ILO/WTO meeting to be preceded by the creation and work of an ILO/WTO forum. The report noted the positive approach of the British Government on that matter who fully support the EU proposal for a joint forum. That point was reiterated by my noble friend Lord McIntosh in his reply to the debate on globalisation on 19th April. So far, so good.
However, I should mention some of the objections that have been raised. The EU has explicitly stated that it opposes and rejects any initiative to use labour rights for protectionist purposes and that the comparative advantage of countries, particularly low wage countries, must not be put in question. I echo what the noble Lord, Lord Parekh, said in his maiden speech. I look forward to engaging with him in many other debates over the years to come.
Perhaps I may make a broader point. The countries which have done best in sustainable development—I use the word "sustainable" in three senses: economic sustainability, democratic sustainability and environmental sustainability—are the ones which have strong trade unions engaged in dialogue with government in an open market economy. Trade unions are the reality of day-to-day democracy so far as concerns employment.
But models of development vary, from the highly successful Singapore model—which is not everyone's cup of tea but is remarkably resilient—through to countries such as South Korea and Brazil. The range demonstrates the correlation between trade union development and sustainable democratic development.
In this context I should mention that Mr Carl—the leading official of the Commission whose evidence appears at page 62—pointed out that countries such as India, Pakistan and Egypt view the EU's motives as regards this matter with a certain suspicion. But they have their motives too. We all have motives.
Perhaps I may give examples of non-sustainability, such as the labour conditions and lack of observation of ILO standards for migrant workers in parts of the Gulf and, of course, in Saudi Arabia, and how this affects the pattern of trade. All Gulf countries ostensibly subscribe to the ILO principles, which include provision for regular visits by ILO representatives and regional meetings. The

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ILO requires delegations to include workers' representatives—but none of the countries in the Gulf sends foreign workers. Saudi Arabia selects a tame national from the state oil company and repeatedly defers regional ILO meetings.
This surely demonstrates rather than contradicts the value of universalist principles. We need to use all the opportunities that we can to promote them—and talks within the WTO will be an excellent opportunity. Three years ago the Indian consul general in Dubai tried to invoke the provisions of the UN Human Rights Commission to force the UAE to give citizenship to children of second generation Indians, one consequence being that they would have rudimentary labour protection. The authorities in both Abu Dhabi and Dubai threatened mass deportations if the case was pursued, and it was dropped.
I am not suggesting that the Gulf is typical of the world as a whole—there is no such place—but it demonstrates one pattern which has vast repercussions all around that area—including, for example, in the Yemen, where I saw at first hand the consequence of deportations from Saudi Arabia after the Gulf War. It is a self-confident and successfully integrated society that gives rights and freedom of association to its citizens.
Perhaps I may say a word in conclusion about NGO involvement in Seattle. It was a useful experiment; the NGOs made a positive contribution. But it is fair to make the point that NGOs cannot expect to be invited into the conference chamber and assume that this has no consequences for the way in which they behave outside the door. The environmental movement, for example, has come a long way since Rio de Janeiro but has probably now hit a plateau, in part because it did not stop to think through whether the dynamics of growth through a certain populism would be valid, at least when some of the reforms it was advocating were on the table inside the conference. This is the lesson that the trade union movement learnt the hard way over the past 100 years and more. There is a debate about development versus environment; global warming is an illustration of that.
We are in effect giving a green and amber light to Pascal Lamy and his colleagues, both in the Commission and in the Council of Ministers. We hope to see a substantial proportion of the mandate agreed.
12.14 p.m.
The Earl of Sandwich: My Lords, I, too, thank the noble Lord, Lord Tomlinson, for producing such a formidable report. I hesitate to join in a debate of such erudition but I do so on the grounds of its importance to developing countries. It is essential to all of us, especially to the 48 least developed countries, that we get the WTO right if we are to make progress in the elimination of world poverty. Here I plead guilty in advance to some of the rhetoric which was so powerfully characterised by the noble Lord, Lord Biffen, to whom we owe a debt.
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I shall make simply four points drawing on the committee's comprehensive report, the recommendations of which I have studied carefully along with some of the evidence. First, as to timing, I strongly support the conclusion in paragraph 159 that the new round must be a broadly developmental round, as apparently already favoured by the UK. It must not take place until the WTO is strengthened and reformed. Whatever we think about the CAP, I strongly agree that the EU must give a lead to the Quad countries in allowing duty-free access to all imports from the least developed countries, which, after all, represent only 0.5 per cent of world trade. It is a matter of confidence. The least developed countries know that they need to belong to the WTO but they will not have any faith in it until they see it working effectively and to their advantage.
It is too easy to say that Seattle was a disgrace and that the WTO was ill-prepared for it. It was hound to happen. In some ways it was a major advance to accommodate 135 nations in one place, not to mention the thousands who came to point fingers at it. But we now know that it was another false start. If we include the MAI, that means that third time has to be more than lucky; it has to be spot on target. A major initiative by the EU now, using Lomé as an example could give the WTO the fair wind that it desperately needs.
Lomé is often described as a model of international aid and trade agreements which has met the reciprocal needs of the EU and the ACP countries. It may be out of date but there is nothing else like it. In the present hostile climate surrounding the EU's aid programme, Lomé is still a shining example which can yet be used to create new mechanisms for a world-wide trading partnership.
My second and related point is about poverty. Freer, fairer trade is a well-understood route to the elimination of poverty. It is the Government's policy objective—as with the DAC 2015 targets they helped to inspire—to reduce world poverty at least to a tolerable level, to a land somewhere beyond the rubbish tips and mud slides, those insulting symbols of the throw-away world we inhabit. It is to attempt to rebuild a world in which the very poorest in the shanty towns and remote rural areas can hold up there heads and at least contemplate some improvement in their children's lives, be it jobs, better housing, drinking water or another basic human right.
The poorest should be at least aware of the attempts to reach them on an international scale, if not at the level of the Marshall Plan or the vision of Barbara Ward—we have put that behind us—then perhaps in a realistic new trade initiative from the international financial institutions in line with the poverty reduction strategies. Could there be, even now, before the end of the Clinton administration, a renewed effort by the international community to replace what is now a fading HIPC initiative to help the highly indebted countries—something of which this Government must at least dream when they are preparing their globalisation White Paper? Trade and trade liberalisation are surely the best means of lifting the

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poorest towards minimal standards of humanity rather than becoming another vehicle for cushioning the stomachs and lifestyles of our industrial society.
Thirdly, on capacity, there must be a structure which will ensure more effective and active participation by the developing countries. A lot of this will be improved by in-country capacity building—and the UK's interest in and contribution to this is acknowledged—but capacity of member countries can also be exaggerated because any technical assistance has to be in proportion to the existing civil service and legal capacity; it cannot be just flown in for the purpose.
Just as important are regional groups and the preparatory meetings, as has been mentioned, which may happen several months in advance of ministerial meetings. One aspect of the fiasco in Seattle was that some key regional countries were thwarted when delegations were isolated in their hotels—they could not even speak to each other. The building of consensus must be a major objective in the next round. It is easier said than done.
Nearly half the least developed countries still have no representation in Geneva. The WTO and its EU supporters need to place more emphasis on consensus building. South Africa has even suggested a two-stage process based on the Uruguay Round. The Secretary of State was interested in that suggestion. Perhaps the Minister can tell us what is the position in that regard. The risks of forcing the pace are considerable in that they could bring the whole WTO system to a halt.
Connected to that is the developing countries' and the NGOs' concern for transparency and accountability, and especially the need for civil society to contribute to the process of negotiation within the dispute settlement procedure and to the development of public policy. That is where trade, aid and development must work closely together. It may be a long way ahead for many countries, but there are examples of action groups in some of the highly indebted countries which show that coalitions of local NGOs and private interests can be effective in monitoring and influencing governments.
Fourthly, I turn to the NGOs. I declare an interest here and depart from the views of the committee and of the noble Lord, Lord Lea, which reflect concerns about the role of NGOs and their participation. Perhaps their view is more fashionable. I firmly believe in the importance and influence of NGOs but I am surprised at the impression given in paragraphs 72 to 76 and the conclusion in paragraph 79 about NGO access. I regard commercial lobbies, which represented over one-third of the 1,000 NGOs at Seattle, as a separate case. It is not the intention of the development NGOs—at least not of the UK-based ones that I know—to sit at the WTO table or take part in discussions which are properly inter-governmental. On the contrary, their concern is for the full and equal participation of national governments, especially the LDCs, and their ability to represent the legitimate interests of their producers. As the committee recognised, it is vital for these NGO voices to be heard.
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The most articulate voices are always those which most closely advocate the causes of their own communities. However, disputes, as we know, are quite often settled by larger interests which they cannot control. Here I, too, have to mention the Caribbean banana producers and the latest threat to their livelihood and to those other businesses in the EU which are likely to suffer from the US "carousel" retaliation announced this week. Many of us hope that the EU will stand up to the bullying Chiquita lobby. If not, our promises to the Caribbean under the protocol will be worthless. There are many other cases where island or one-crop economies are similarly threatened by unfettered trade liberalisation. These must be the subject of special arrangements for those regions.
In conclusion, I hope to hear from the Minister, as he told us in the globalisation debate, that core labour and environmental standards, while they can be raised in the joint forum or even within the dispute settlement process, belong more properly with the ILO and with the World Bank than they do with the WTO. That would give reassurance to those developing countries which again fear the heavy hand of the US and other business interests. If the European Union governments do not have poverty eradication firmly in sight—US pharmaceutical companies and the AIDS situation in Africa come to mind—the whole edifice of the WTO, which developing countries and developed countries so badly need, will have been in vain.
12.23 p.m.
Lord Freeman: My Lords, I wish to be associated with the remarks of the noble Baroness, Lady Sharp, and the noble Lord, Lord Lea, in congratulating the noble Lord, Lord Parekh, on his wise and concise words. From the Conservative Back Benches, we look forward to his contributions with great anticipation. We extend a warm welcome.
I very much agree with what the noble Lord, Lord Tomlinson, said in his opening remarks, particularly about the need for greater liberalisation of services. My brief remarks are concentrated on that subject. I very much agree with the report. I welcome it. It is an excellent contribution to the debate. I join the noble Lord in congratulating his committee and the Clerk on its preparation.
I declare an interest as a former partner of PricewaterhouseCoopers, which has given written evidence to the committee on services. But I, like my professional friend, the noble Lord, Lord Sharman, am now relegated to the role of superannuated adviser, rather as he is with his firm. Nevertheless, I associate myself with the report delivered by my firm and with that of British Invisibles, chaired now by my noble friend Lord Levene, who cannot be with us for the debate today.
As the report says in paragraph 166,
"open markets in services are beneficial to the global economy".
My noble friend Lord Biffen frankly described himself as a minimalist. He will forgive me if I describe myself as—not exactly at the other end of the spectrum but a little further distant—an optimistic globalist. I say so

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because I firmly believe that, as the noble Earl, Lord Sandwich, so eloquently reminded your Lordships, the development of world trade in goods, investment and services should benefit all countries. Certainly in modern history, the record shows that that has been broadly the case. But we need a much freer flow of people. It is the people who provide the specialist, managerial and technical services in particular which are the lubricant of growth. Services in the western industrialised world now account for approximately 70 per cent of gross domestic product. Yet, as a proportion of world trade, services account for around 20 per cent.
There are still significant barriers to the liberalisation of services. What are they? There are two main barriers, both of which the report addresses. The first is the mobility of workers, of people. I am not talking about immigration, but the mobility of people who are to provide services. I refer in particular to those who do so for relatively short periods of time, perhaps up to 12 months and in some cases up to 24 months. There are many examples of visa and work permit restrictions, not only throughout the western world but throughout the world as a whole. I am referring not just to what sometimes commentators regard as the people most affected by restrictions on short-term work permits. I am referring also to semiskilled and unskilled workers from the developing countries who, for short-term contracts, have sometimes a vital role to play. That point is developed, quite rightly, in paragraph 69 of the report.
The developing countries have as much to benefit from the liberalisation of free movement of people as those who are sometimes referred to as the key business or professional people. It is important—the noble Earl, Lord Sandwich, touched on this point indirectly, but I suspect he would agree—that the liberalisation in services should not be seen as benefiting the western industrialised nations and the business and professional classes only. We are talking about global liberalisation.
The second barrier is national protectionism in relation to the licensing of functions provided by groups of workers or individuals. As the report says, the principle of non-discrimination by nations in relation to domestic workers and foreign workers is extremely important when it comes to the short-term provision of a service, be it professional, technical or otherwise.
There is a separate related issue of the mutual cross-recognition between countries of professional qualifications and skills. Having made a modest contribution some 35 years ago in terms of the liberalisation of British professional practices, and having revisited what I wrote then, I realise how little progress we have made in western Europe. In this country we are still protectionist in too many of our professional services and we have a long way to go.
What progress can be made? First, those who provide services—which includes a broad range of services, as I stressed earlier—need to have their collective voice heard by the Commission, because the
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European Union shares equally with national governments responsibility for negotiating the liberalisation of services, unlike the liberalisation of trade. Thus, the services sector needs to ensure that it makes its voice heard clearly not only by the Commission in the form of the European Services Forum—which was established under the aegis of Sir Leon Brittan; I welcome that—but also needs to ensure that that forum is closely in touch with Her Majesty's Government along with the other European governments.
Secondly, and more importantly, I conclude by saying that the General Agreement on the Trade in Services is now stalled in a political vacuum, following failure in Seattle. Noble Lords will recall that the general agreement on services as opposed to tariffs and trade was established and commenced its work in 1994, but negotiations were to begin in earnest this January 2000. However, very little progress has been made. What is needed, therefore, is to kick-start those negotiations to liberalise the provisions of services globally by setting up a new ministerial conference. I congratulate EU trade commissioner Pascal Lamy—he came to London last week—on his vision and determination not only to ensure that, from the standpoint of the European Union, a ministerial conference is held, it is hoped, at the beginning of next year, but also on ensuring that the provision of services is high on the agenda. I hope that noble Lords will agree with that.
12.31 p.m.
Lord Desai: My Lords, first I should like to welcome this report and to thank my noble friend Lord Tomlinson for his kind remarks on my contribution to it.
The World Trade Organisation is an extremely important and unique institution of post-war economic regulation and governance. As my noble friend Lord Parekh said in his excellent maiden speech—I look forward very much to his future contributions—the WTO is the only body which treats all its members equally. That is not true of the United Nations or of any of the other great world institutions. The WTO is the only body that has made decisions chastising the United States which the United States has then obeyed. Because it is such a unique institution of economic governance, it is important to ensure that it is preserved and strengthened.
I was fascinated and intrigued by the remarks of the noble Lord, Lord Biffen. He said that he was a minimalist in this area. It is right to say that GATT made great progress from 1945 to 1994 by sustaining a passive, minimalist approach. However, at that time, GATT was by and large—not entirely—a club of OECD countries. The Uruguay Round was initiated by the developing countries because they wanted to gain access to the markets of the developed countries, which until then they did not have. All the talk—the Kennedy Round, the Tokyo Round and so forth — may have liberalised trade among the developed

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countries (which was all well and good) but not enough was being done to enable the developing countries to gain access to western markets.
We should remember that in the initiatives driving the Uruguay Round, the developing countries came to realise that they, too, had a stake in encouraging freer trade. I shall not talk about "free trade"; there is no such thing. That is due mainly to the policies of the developed world, but I shall not go too deeply into that matter. However, freer world trade works in the interests of the developing countries. That is why the initiative was taken with the Uruguay Round. When the WTO emerged from GATT, it needed a different set of rules to which everyone could subscribe; otherwise the weaker countries would not benefit from freer world trade, something they thoroughly deserved. The WTO is a different institution from the old GATT. Furthermore, as the report rightly points out, it is—possibly alone in the world—a rule-based system. For example, even the Multilateral Agreement on Investment, which foundered on various different popular protests, was rejected by the US Senate. The Americans did not want to see a multilateral agreement on investment because they did not wish to be treated like everyone else. Thus it is important that the logic of the rule-based system is advanced step by step in other spheres of the global economy. In that respect, the WTO plays an essential role.
I agree with several points made in the report as regards what took place in Seattle and why those events proved to be very bad for the developing countries. The people demonstrating outside the meeting thought they were defying the power of the multinationals and so forth. However, all they succeeded in doing was to reinforce the power of the developed countries—especially the host country, which for entirely incidental political reasons, sabotaged the Seattle meeting. I put it no more strongly than that.
That means that any future ministerial meeting cannot be held until after the new US President has been bedded down in post. It is an unfortunate fact of life that the US is an extremely important elephant in this jungle. Indeed, much of the delay over the signing of the 1994 Marrakesh agreement was due to misbehaviour on the part of the United States and the European Union. In the final stages of the Dunkel draft, more time was spent debating French agriculture than considering any of the poor and developing countries.
I am worried that those who complain the most about the WTO are, in fact, the rich countries rather than the poor nations. Perhaps I may say that two-thirds of those who attended the Seattle conference were sent there by AFL-CIO, which, I am sure, wishes only to do a good job of protecting its members. However, every job protected in a rich country takes away a job that could be created in a poor country. It is important that the rich countries take a positive attitude to the restructuring caused by freer trade, rather than adopt a passive and protectionist attitude.
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Every time a factory closes in this country, a Minister feels compelled to say that he will protect those jobs. I do not know why that is so. We should say, "That is a fact of life in free trade. We should advance, restructure, reorganise, retrain and then open something new". We should not be protecting our car industry, coal industry or iron industry. That is not the way to encourage development or to eliminate poverty in the world.
If the rich hang on to their gains, if they do not make the necessary structural adjustments, we shall not see the poor get any richer. The European Union should be more bold than it has been so far in adopting a true leadership role in WTO negotiations. Furthermore, it should commit itself, through its own policies, to stop the subsidy of domestic industries—as is still done all too often. I appreciate that that is a harsh lesson. Many of us who have been on the Left and progressive side thought that the state should be the protector of jobs. If the state does not protect jobs, we worry. However, if we protect jobs over here, then we shall destroy jobs over there.
It is important to adopt a positive and, indeed, an internationalist attitude in this respect. Furthermore, the EU should take the lead. I am not at all fascinated by Monsieur Bové, the maker of a highly delightful cheese who enjoys a great deal of protection, when he risked the anger of the great multinational corporations by destroying a McDonald's restaurant in France. He does not, by any means, represent the poor. He represents only a form of European protectionism fighting a form of American protectionism. We must declare that we are not too interested in that kind of thing. If the poor countries are to become rich, they will do so as a result of greater open access to markets in developed countries. Developed countries should not erect any form of barriers to trade with such countries; indeed, they should encourage it as much as possible.
A strong argument was advanced by my noble friend Lord Parekh that some developing countries are not yet ready to benefit from trade. But the answer is not to keep them in that state, but to enable them to benefit. The poor do not benefit from trading with the poor; they benefit from trading with the rich, because that is where the money is. Unless that is done, they will not advance.
Perhaps I may make one controversial point. I am not at all sympathetic to the EU banana policy. The EU had a 10-year notice that the banana policy was not acceptable in terms of most-favoured nation status and liberalising trade policy. It is not a good idea to keep a mono-crop country mono-crop. All these years, we have paid lip-service to economic diversification, but have not implemented that approach. It is no good complaining that Chiquita bananas are produced by large-scale corporations, that there is a great deal of investment, and so on. Why did not the EU invest in those banana production facilities? How do EU countries think that poor banana growers will become rich? By remaining poor banana growers? The poor of Honduras and Guatemala who work to produce the bananas are employed by Chiquita and probably have

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decent working conditions. So we need to examine carefully whether the EU has done well by its former colonies where bananas are grown. Structural readjustment is necessary, not merely in terms of economies but in our whole approach.
12.41 p.m.
Lord Taverne: My Lords, it is always a great pleasure to follow the noble Lord, Lord Desai. Like him, I am a strong supporter of the WTO. I need not make the case for it, because the noble Lord has done so eloquently. The noble Lord is all the more persuasive an advocate for the WTO because no one can accuse him of being a spokesman for the multinational companies or of being unsympathetic to the plight of the developing world.
In the course of the committee hearings, the case was also made powerfully by Clare Short. Perhaps I may quote part of her passionate evidence, which is cited by the committee at page 10 of its report. She said:
"The fastest reduction of poverty for the largest number of human beings that has ever happened in human history was East Asia's progress over the last 25 years, and it is built on opening up their economies to inward investment and trade and export and a … concentration then on education of their people, a fantastic achievement … just in pure numbers of people getting out of abject poverty and seeing improvement in their lives".
That was a quotation worth making in the body of this interesting and excellent report.
Perhaps I may begin my comments with another quotation from Clare Short concerning the attitude of sonic of the NGOs. It appears at page 19 of the report. She says:
"We have got lots of people from industrialised countries speaking on behalf of the interests of developing countries who, in the words of the Minister from Malaysia, are almost trying to save the developing world from development".
Had I been her, I might have cited a different authority than a member of Mr Mahathir's cabinet. Nevertheless, her remarks are telling. It is a pity that some of the NG0s, who start with excellent motives, have in so many respects begun to advocate policies that will be counter-productive to their aims. I was for a long time a supporter of both Friends of the Earth and Greenpeace, but both have turned against science and their attitudes to some of these issues are not helpful to their own causes.
I want to touch on three issues that are of central importance to the developing world. What I like about the report is that it does not pull its punches. It slightly obfuscates and fails to deal with one or two issues—for understandable reasons—but others it faces squarely. A good example is the common agricultural policy. The lack of progress in reform may be understandable, but the fact remains that it is an absolute scandal. It is vital that there should be progress if we are to deal with hunger in the world. One can only hope that the needs of enlargement will produce more rapid progress than has been made so far. As the report points out at page 35, the developing world needs better market access; it also needs a reduction in subsidised exports and a reduction in domestic support.
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What is the effect of the common agricultural policy? It is put very well at page 271 of the evidence to the committee, in the words of a submission by Oxfam:
"The Common Agricultural Policy causes massive market distortions, and directly contradicts other EU policies which aim to promote development … The dumping of subsidised Northern exports in developing countries distorts markets, undermines the competitiveness of often highly efficient local producers, and threatens rural livelihoods and food security".
Members of Friends of the Earth and others should note that point. So often, when the argument is advanced that the developing world needs GM foods, they turn round and say, "That is not the answer. There is plenty of food in the world. All we need is to do is distribute it more fairly". There is plenty of redistribution already. There is redistribution through the common agricultural policy. Let me repeat the words of the report:
"The dumping of subsidised Northern exports in developing countries … undermines the competitiveness of often highly efficient local producers, and threatens rural livelihoods and food security".
That is a point worth making. We have often pandered to some of these lobby groups to a disgraceful extent.
That brings me to my second point—one which the committee studiously, though understandably, avoided: the attitude of European countries to GM food. There was a report in The Times yesterday about yet a further statement by leading academic authorities, leading scientific bodies, in the developing world and the UK. The Royal Society played a major part. Those authorities repeat what should be common knowledge: that GM food production is an important part of the solution to the problem of feeding the world. It means that crops can be grown in and regions. How can we solve the enormous problem of improving agricultural productivity by conventional agriculture? That means using up marginal land, with economically and ecologically disastrous consequences. Water shortage is already a major problem to urban society. Food shortages cannot be met through extra irrigation. We need GM technology. But the European Union will not even discuss the issue properly. This is one issue on which the United States is far more sensible than we are, and far more progressive. Europe places massive obstacles in the way of exports of GM crops which the developing world needs.
The situation is made worse by eco-labelling. I understand that if consumers want eco-labelling, is hard to deny them. One cannot tell consumers what is good for them. But one should also remember that this is done on a totally irrational basis. There are no grounds for the special labelling of GM products when there is no evidence whatever that these products are a danger to health.
I attended the OECD conference in Edinburgh where there were 400 experts from around the world. At the end of the conference the chairman, Sir John Krebs, asked, in the presence of representatives of Greenpeace, consumer groups, Genewatch and Friends of the Earth, whether anyone at the gathering had evidence of any kind of harm caused by GM foods, any danger to health. There was absolute

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silence. That was enormously significant. Hundreds of millions of Americans have eaten GM foods for over a decade. There is no shred of evidence of harm to health. I am glad that at last this has been recognised at least by the Commission of the European Union. In today's Guardian there is an article about the complaints by Greenpeace as a result. Commissioner Byrne believes that we must be realistic and recognise that there is no scientific evidence whatever of danger to health from GM foods.
My third point is concerned with intellectual property rights. This is another difficult issue on which the report makes no clear recommendation, as the noble Lord, Lord Tomlinson, observed. I sympathise with the committee because it is a very complex issue, the solutions to which are not clear. Like the report, I accept the need for patents to encourage innovation and investment, but I also believe that the balance has swung too far in favour of the multinationals and against developing countries.
I have some sympathy with submissions made by Friends of the Earth which can be found on page 47 of the evidence:
"the Trade-Related Aspects of Intellectual Property Rights (TRIPs) Agreement threatens the culture and livelihoods of communities in poorer countries, by imposing intellectual property rights systems that blatantly disregard local agricultural knowledge and tradition and discourage production of cheap pharmaceuticals".
Clare Short has said that there are some terrible myths in this field, and that may be true. I do not have sufficient expertise to talk about this matter with any great authority. However, there seems to be an imbalance here. I am glad that my noble friend Lady Sharp provides powerful support. Some unreasonable requirements have been placed on the developing world under TRIPs and I believe that it should be looked at again.
Several multinational companies appear to recognise that. Spurred on by Mr Gordon Conway, Monsanto has made important concessions. For example, its work on the genome sequence of rice has been made available free to the International Rice Institute in Manila. It also hopes that various licences can be waived to deal with the insertion of the vitamin A gene into rice. Recently, Novartis has also announced similar concessions. While we should be critical of multinational companies, we should not abuse them unreasonably because they are part of the solution. There is also a certain amount of good-will there which can be exploited. However, it should not simply be a matter of compassionate waiver; one must look at the agreements themselves. One cannot rely solely on compassionate waivers to help to solve the problem of hunger in the world through the exploitation of GM technology.
I welcome the report and the speeches made in this debate, including the very distinguished contribution by the noble Lord, Lord Parekh. As the noble Lord, Lord Tomlinson, said very eloquently, if the new round is to be successful it requires meticulous preparation. Some very difficult problems must be
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solved and hard choices made, and the sooner the issues are more widely debated and considered the better.
12.53 p.m.
Lord Bruce of Donington: My Lords, I congratulate the Government and the usual channels on providing this House with an opportunity to advise the Government on their whole attitude towards the World Trade Organisation and the desirability of furthering its objectives. We can do very little other than offer advice, unless we happen to be happy members of a focus group that is charged with a specific task. However, on the assumption that we are all equal, our advice should be taken into account.
I find the report of the Select Committee very interesting. It indicates the deliberate choice that this House should consider the line of action to be taken by the WTO but with particular reference to the European Union. After all, we are considering a report by the Select Committee on the European Union.
While I agreed with most of the speech of the noble Lord, Lord Tomlinson, I marvelled slightly at his extreme politeness in dealing with the role of the European Union in these matters. The report is very pungent in its views on part of the role of the European Commission. For example, in the summary of the opinion of the Select Committee one sees in paragraph 9 on page 3:
"We recognise that under the EC Treaty it is inevitable that the Commission will negotiate in the WTO on behalf of Member States. The terms of the mandate which has been given to it allow considerable flexibility, but it is important that the Commission should act strictly within the limits of its authority—and disturbing that some important decisions seem to have been taken without reference back to Member States".
That is further elaborated in the evidence of Mr Stephen Byers and Clare Short at pages 207 to 216, to which I commend your Lordships' attention. From that it is quite clear that, without taking all proper steps to communicate with the Council and its members, some of whom were there, the Council deliberately arrived at decisions in regard to recommendations for the post of director general which ran contrary to the views of member states which the Commission did not contact. These are serious matters.
It is important to understand the whole machinery for arriving at agreement and action in this field, whether on behalf of the companies involved—I assume that they are involved not only in trade but services—or others. After all, "agreement" means "discussion" which in turn means discussion between people who represent governments, NGOs or whatever they may mean. Most noble Lord will be aware from their personal experience that such discussions and the preparations for them have one characteristic in common: they take time. Time is required not only to consider all the factors but to formulate opinions and to read the various documents which are placed before governments before they arrive at decisions. The UK Government do not lack paperwork from the European Commission on which

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to arrive at decisions. I am aware that day after day they are literally deluged with draft proposals or draft legislation in the form of rules, regulations or whatever. Furthermore, it is clear that in this House and in another place the scrutiny committees are able to see only a fraction of the material that emerges from the European Commission.
I raise this matter deliberately, because, if somebody—it could also be put in the plural—is to take action to achieve the objectives of the WTO, he must be aware of all the current developments and also the attitude of others before negotiations can even begin. That is a pretty prodigious task. I am convinced that my own country—I take it as the United Kingdom for the moment without its association with the European Community—has all the basic qualifications to enable it to negotiate the United Kingdom's position with the WTO of which it was a founder member.
In correction of somewhat undue modesty towards the United Kingdom's own position, achievements and power, we should remember that we have a unique advantage enabling us to have either a direct link with the WTO or through our representations within the European Union. We should remember that we are probably the fourth largest economic power in the world with the USA, Germany and Japan. We are a founder member of the Security Council. We are a member of the G7. We are a member of the IMF, the World Bank, the Commonwealth and NATO. We have enormous power at our disposal. Instead of denigrating that power in favour of others—by calling for "must-catch-up-with"; or "must-catch-the-bus" and the rest of the paraphernalia which our own country has denounced—we should remember that we are a country of some significance and with a history of some significance in relation to most of the powers that exist in the world and the developing countries.
I raise that point because the common agricultural policy has been touched upon, in particular by the noble Lord, Lord Taverne. Does any noble Lord think that the European Commission has any intention whatever substantially to amend the common agricultural policy? Yet there is common agreement—it is shared by all sides of the House and another place—that the developing countries must be free to supply the world with their own food products which will enable the developing countries to have their proper share of world prosperity. There is not the remotest chance of that happening. If we were to think for one moment that there will be any drive from that quarter in that direction, we delude ourselves. When I had the honour to represent your Lordships' House and the country in the European Parliament at the beginning of 1975 there was talk about drastic reform of the common agricultural policy. Some minor amendments have been made since but the Commission has no intention so to do.
This is a debate in part on the European Community and I venture to reiterate my own views although they have not always been popular in your
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Lordships' House except in relation to fraud where there is general acceptance of my original observations made many years ago.
The European Commission has one overriding purpose: to become the government of Europe. I can provide many quotations; I shall not weary your Lordships with them. But everyone knows that this is what it is bent on doing. So it goes into discussions on other matters always with that one reservation in mind: that whatever it does must be strictly in conformity with its drive to be the government of Europe. That has been emphasised many times, not only here but in many other countries.
On the other hand, we are in a different position. We have the powers and the reputation which I have mentioned. I refrain from adding for good measure a measurement of time, the English language, and so on. We are unique, in particular from the Commonwealth standpoint. I talk of India and Pakistan—even though there are differences there. Our influence is enormous if only we care to use it; if only we can spare the time to do so and if only we can identify those matters in the European Union which are of real value and on which there should be detailed co-operation. I refer to the fields of the environment, long-distance transport and many others. If we confine ourselves to those areas we should then proceed with speed to organise—if necessary on our own initiative, together with other members of the WTO—a conference at which meaningful negotiations can properly take place without there being any division of interests.
Yesterday in another place my right honourable friend the Prime Minister revealed a report dealing with the Government's activities. It is clear that in many significant fields very great progress has been made. It is also clear that much more still has to be done, and one such example is that we abandon the concept of trying to get to the heart of Europe—whatever that may mean. We do not need to be at the heart of Europe particularly when the events over the past year and the frauds revealed since demonstrate that the core of Europe as it is now is already rotten. We have no need to be part of it but should rely upon our own judgment, our own Civil Service and many loyal European Commission civil servants too. They are not all in the same category as those in some of the ministries which have been criticised. This is the way to gain a World Trade Organisation with extended influence, leading to more extensive prosperity throughout the world including the developing countries. I am convinced that my own country is probably the best of the lot in leading the propulsion towards that end.
1.8 p.m.
Lord Beaumont of Whitley: My Lords, I, too, join in thanking the committee for its report, and the noble Lord, Lord Tomlinson, for his introduction of it. It seems a most fascinating and suggestive report and in some areas very imaginative. Nevertheless, on behalf of the Green Party and myself I have queries and reservations. I believe that in some areas the report should have gone further.

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The committee concludes that it would not be appropriate either to bring the WTO formally within the United Nations family or to establish a WTO parliamentary assembly. But nowhere in the report do I find those particular conclusions supported by argument. I do not know why it came to that conclusion and the report does not appear to give any indication of how it was reached.
I and my party believe that to bring the WTO into the UN framework would be a welcome insurance against the progressive hijacking by trans-national corporations. If this was to be done, there would be little point in a WTO parliamentary assembly. If it is not done as the report suggests, I think that a parliamentary assembly would probably be a very good thing.
I welcome the conclusion in paragraph 9 of the summary that the tendency for the European Commission to negotiate on important points without referring back to the member states—I join with the noble Lord, Lord Bruce of Donington, in condemning that—should be nipped in the bud, if it is not already a thriving branch. I also welcome the call for the WTO to hold dispute settlement procedures in public. These are matters of the utmost importance which affect everybody. Indeed, the whole of paragraph 31 on this subject provides us with an admirable and imaginative expansion of that idea.
Paragraph 16, on finance, is important. The WTO must be properly financed, and the idea of even considering privatisation is appalling. The committee's request for an explicit acknowledgement that agriculture serves many purposes is most important and long overdue. Although I wish to see European agriculture thriving, I entirely concur that the EU should prevent dumping in world markets. However, since I and my party believe in the supreme importance of every country being able to feed itself as far as possible, it follows that we would not go along with opening EU borders to unprocessed agricultural produce from the undeveloped countries. They should, if necessary, be encouraged not to rely on one form of produce, as the noble Lord, Lord Desai, suggested with regard to bananas.
Finally, I join your Lordships in deploring another round without adequate thought. It would be a recipe for chaos, even if it was held on a desert island, and, although in our view more chaos would be preferable to a retreat to the status quo ante, a serious, well thought out reform of the whole institution is preferable to either.
1.13 p.m.
Lord Sharman: My Lords, I welcome the opportunity to contribute briefly to the debate. I too was a member of the sub-committee which produced this report and which was so ably chaired by the noble Lord, Lord Tomlinson. I should like to associate myself with the tributes paid to the work of our Clerk, Dr Elizabeth Hopkins. It was my first experience of
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working on a sub-committee, and whatever this House may lack in quantity of resource, it is assuredly compensated for by its quality.
I shall confine my remarks to four issues. They may not be the most important but they struck me rather forcibly as we gathered evidence and reviewed our conclusions. They are transparency, trade in services, competition rules and whether free trade is fair trade.
References to transparency are sprinkled throughout the evidence and the report. I was interested to note the CBI brief, which many of your Lordships may have received and which is entitled Global Trade: Global Gain. After a statement with which I found it difficult to associate myself, namely that trade is a sexy issue, it says that the issues of transparency and accountability need to be tackled. Although transparency is vital for proper accountability, it is not a panacea for all our problems. Indeed, when used by different people the term does not always mean the same thing. Sometimes the organisations that complain about a lack of transparency are really complaining that they do not always get what they are lobbying for. Other organisations use it to complain that they have not got their desired seat at the table.
The report demonstrates that the WTO is a relatively transparent organisation. It publishes a lot of information on its website and in its documents. The EU and our Government are to be congratulated on their degree of transparency. I associate myself with the remarks of the noble Lord, Lord Lea of Crondall, concerning the mandate. If ever a document demonstrated transparency, the mandate is it.
Clearly further progress is needed on this vital issue, most importantly perhaps by holding dispute settlements in public. Great progress has been made with the dispute settlement process, particularly by enabling the provision of lawyers for everyone and by providing quasi legal aid, but public hearings of dispute settlements would be a valuable step forward.
I should like to associate myself with the remarks made about trade in services by the noble Lord, Lord Freeman. Despite what many may think, although we are both superannuated members of accounting firms, we have not talked about this issue before. To many, the WTO equals trade in produce. Yet as the noble Lord, Lord Freeman said, services as a proportion of the total economies in the developed and developing world are not only important but growing. It is important to make progress on that front. The CBI perceives that as a priority.
I welcome the formation of the European Services Forum, but it needs to ensure that it has adequate links directly into the governments of member states. It is important to remember that the EU derives its mandate from the member states and not from trans-European entities. It is also important that we should see more input other than from the financial services industry and professional services. It was noticeable that the overwhelming majority of evidence from trade in services came from financial services or professional services. Areas such as travel, tourism and the like were noticeably absent.

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It is also an area in which non-tariff barriers can provide a significant impediment to trade, particularly the use of regulation. I, too, endorse the notion of the principle of national treatment as one way forward. By "national treatment", I mean that foreign and domestic service providers should be treated the same way.
I turn to competition and competition policy. It is linked with investment but I want to carve out the issue of competition. It is a very difficult area and the temptation must be to place it into the "too hard" box and leave it there. I accept that limited progress in the area will be possible. Again, the CBI in its submission notes the need for a level playing field.
Whether we like it or not, globalisation is with us. It is a driving factor and there is a need to have some form of framework. It is noticeable that many developing countries have no national rules on competition. I would encourage the Government to make a start. I do not believe that the matter should be put aside—the temptation will be to do so and to leave it—but that a start should be made on the framework.
I turn finally to the issue of free versus fair trade. In much of the evidence that we took the WTO was characterised as being hell-bent on unlimited free trade. That was the criticism levelled against it. The notion was advanced that free trade in that sense cannot be fair and that what is needed is fair trade to ensure that the benefits of free trade are shared more equitably. I suspect that that notion lies at the root of much of the criticism of the WTO and the assertions that it is broken beyond repair. I do not believe that to be the case and neither the report nor the evidence supported that view. It is clear from the evidence that if the WTO did not exist we would need to invent it to do the job that it is doing.
I, too, was most struck by Clare Short's evidence of the benefits which can be demonstrated. As is stated at the beginning of the report by the RSPB, it is not a question of rules or no rules; the question which faces us in ensuring that we have a balance between fair and free trade in the world trading system is: whose rules and what rules?
1.23 p.m.
Baroness Byford: My Lords, I, too, want to congratulate the noble Lord, Lord Tomlinson, and members of the Select Committee on their report. It is detailed and raises important issues for the future of international trade. The rules-based system encourages trade and services and should include help for developing countries.
Perhaps I may concentrate my few comments on agriculture, as I know that other noble Lords have dealt with the other important and wider issues.
In March last year, when the EU agriculture Ministers met, they came forward with new proposals for changes to the CAP. At that time, some people within the farming community suggested that the original proposals did not go far enough. At a later meeting of heads of state, the proposals from agriculture Ministers were watered down even further.
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The CAP reform was a farce and a disappointment. Important issues were not tackled and several noble Lords have mentioned them.
At the time, we on the Conservative agriculture team and many others spoke out against the failure of the EU to achieve radical reform and pointed out that it would add to the difficulties of the conference in Seattle later in the year. That proved to be the case. It was recognised that the reduced proposals would weaken the EU's position when WTO talks took place later in the year. That is the background against which I want to base my comments. The noble Lord, Lord Tomlinson, spoke positively of the need for proper reform of the CAP and many other noble Lords mentioned it today.
The Select Committee's report clearly recognises the difficulties. Paragraph 19 on page 4 states:
"We should like to see explicit acknowledgement within the WTO of the fact that agriculture serves many purposes (though preferably avoiding the barbarous term 'multifunctionality')".
The problem is that I cannot find a more simple term. It continues:
"But we do not agree that this provides a justification for continuing the Common Agricultural Policy in its present form … we remain convinced that more radical reform of the CAP is needed".
Perhaps at this stage I should declare my interest in a family farm in Suffolk.
Paragraph 33 on page 6 states that the EU,
"should be going for a Round which concentrates on the issues where progress is most likely to be achievable, rather than for looking for trade-offs on the broadest possible canvas".
I support that suggestion.
Yesterday I was not in this House. I left early and was at the Great Yorkshire Agricultural Show, the eighth show I have attended this year. Farmers are not asking for special treatment, but they are looking for a level playing field. That is another phrase I do not like but I have not found a substitute. Farmers look to the Government to ensure that they do not have to carry extra burdens which have not been imposed on farmers in other countries.
I want to share some thoughts with your Lordships. Extra costs imposed upon our farmers are the result of extra regulatory burdens imposed on them by Brussels. As regards animal welfare standards, I want to place on record my appreciation to all our farmers, who work to the highest standards. They do not want to reduce those standards; they want to maintain them. However, producers who send products to this country are not required to achieve those same high standards. That imposes extra costs on our farmers.
We in this country have adopted various countryside stewardship schemes in order to improve our environment. Indeed, we have encouraged farmers to take greater care of it. However, I suspect that the concept of supporting farm incomes in return for farmers producing environmental goods rather than food could come under heavy criticism from other

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trading nations. That matter was raised with me by British Cereal Exports. It expressed its concern that the Cairns Group is likely to claim that the payments are a disguised way of supporting farmers to produce food. In countries such as Argentina and Canada, where population density is low and the area used to produce food rarely seen by the majority of the population, there is great difficulty in convincing people that farmed land has uses other than food production.
Fourthly, and perhaps most importantly, it stated that farmers are accused of receiving subsidies when other countries—for instance, America—support their farmers financially but under a different terminology and a variety of different schemes. Unlike us, they do not use the term "subsidy".
Surely, we must all agree that we must move forward and speak the same language. Unless we do so, in trying to solve problems we shall be approaching them from different angles. As regards the agriculture industry in Europe and internationally, I fear that that is one of the biggest problems that we face. We all approach this matter in a different way, and I hope that the report, which I welcome, will strengthen the ground rules. If we do not understand each other and accept that others have safety nets, or whatever, we shall not reach common agreement, which I believe we all desire.
On pages 34 to 36, headed "Anything but Agriculture", the report recognises the challenges which face EU countries in trading in the global world. Paragraph 133 recognises that, whether the EU likes it or not, negotiations on agriculture cannot be avoided. That I heartily endorse. In the following paragraph—No. 134—the committee states that,
"[it] is not surprising, with not only the Cairns Group but also developing countries ranged against the EU",
that there are problems to tackle.
I thank the noble Lord, Lord Tomlinson, and all those who contributed to this important document. I apologise if my comments have leaned towards the issue of agriculture. However, I believe that the report gives a good example of some of the real problems that we face, I suspect in other industries, too, but particularly in farming and animal welfare.
The noble Lord, Lord Desai, who is not in his seat at present, mentioned subsidies. However, the truth is that at the moment, for example, approximately 40 per cent of chicken breast imports to this country come from developing countries. It is known that many countries do not have to adhere to the strict regime that we have in this country. Why does that matter? It matters because our farmers are more likely than ever to go out of business. Last year some 18,000 went out of business. If that continues, two things will happen: our rural community will not be helped but, more importantly and more worryingly, some of the great expertise that we have within that sector will be lost.
I thank the noble Lord, Lord Tomlinson, for giving us the opportunity to debate this issue. It is hugely important because we in this country, within Europe
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and, indeed, throughout the world wish to move ahead with a freer trading environment. However, we must do so with a basic understanding of our intentions.
1.32 p.m.
Lord Grenfell: My Lords, I begin by thanking my noble friend Lord Tomlinson and congratulating him warmly on the excellent report from Sub-Committee A of the European Select Committee. I speak quite objectively because it was not until 9th May that I rejoined Sub-Committee A. Its members were near the end of their labours and were about to deliberate on the chairman's draft report, a text in which I recognised the sure and experienced hand of my friend Dr Hopkins, to whom I pay great tribute.
My noble friend Lord Tomlinson has given an excellent summary of the report. After listening to many speeches covering a wide range of issues, I want to pick out only a few of the report's conclusions which strike me as being of major importance.
Quite rightly, the report endorses the assumption in the EU mandate—I agree with my noble friend Lord Lea of Crondall that, by and large, it is an excellent mandate—that globalisation accentuates the need for a rules-based trading framework which only an international organisation such as the WTO can provide. Those who fear globalisation and demonise the WTO as globalisation's evil agent cannot or will not grasp that point. It is because the largest countries stand to gain the most in absolute terms from trade liberalisation that the WTO, as my noble friend Lord Desai said, is needed to make sure that rules of the game exist to ensure that developing countries make substantial relative gains and that those rules are followed in that, among other, areas.
The European Union understands that, even if it does not always follow it to the letter. The case of bananas has been quoted. The EU's mandate affirms its support of a multilateral system which rejects protectionism and unilateralism. However, that in itself is obviously not enough. The committee's report rightly insists that the EU mandate reflects a firmer commitment to a fairer spread of the benefits which flow from a multilateral, anti-protectionist trading regime.
I am glad that the inquiry concluded that the demonstrations in Seattle, unhelpful as they were, were not the prime cause of the collapse of the negotiations at the ministerial conference. The failure to prepare properly, the choice of venue, the chairmanship and the often insensitive handling of the developing countries' participation contributed in varying degrees to the eventual débâcle. The report rightly does not mince its words in deploring the great harm done to public confidence in the system by that collapse and in its insistence that further failure cannot be contemplated.
The previous eight post-war rounds made a progressively important contribution to the world's economic expansion and integration, and there is no reason why further rounds should not bring further significant gains. From the beginning, as the report

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notes, the GATT depended on a process of wide negotiation and trade-offs, and it has worked well. Therefore, the EU would do well to maintain the principle of a comprehensive mandate, which it should execute pragmatically and flexibly.
On that point, perhaps I may refer to a remark made by my noble friend Lord Bruce of Donington. He stated that the Commission had exceeded its mandate, as we know that it did on one or two occasions. However, that was not in order to influence the appointment of the director-general of the WTO; it was in relation to the appointment of a chairman of the agricultural group in order to continue the work after Seattle.
I seek to reassure the noble Lord, Lord Beaumont of Whitley, as to why we do not feel that the WTO should he part of the United Nations' organisation of agencies. It should perhaps have been spelt out more clearly in the report, but we subscribe to the views of Mr Andrew Stoler, the deputy director-general of the WTO, as set out in paragraph 58 of the report. For many reasons, given in his evidence at questions 462 to 464, he felt that it would be inappropriate.
A heavy responsibility also lies on European Union governments, on academia and on the business community to make information about the trading system more widely available, including how the system operates and what benefits are derived from it. It is truly depressing that so much of the hostility directed at multilateral trade negotiation is based on a needlessly inadequate public understanding of what is at stake and how benefits can best be secured and fairly distributed. That also raises the question of the WTO's own transparency, referred to by the noble Lord, Lord Sharman. As Martin Wolf recently pointed out in the Financial Times, the organisation is becoming vastly more accessible. However, critics are right to call for public access to the dispute settlement process and, at the least, immediate distribution of' the minutes of official proceedings. I believe that the report reflects some of those concerns as well.
Of course, as the report points out, it is absolutely crucial that the voices of social partners and of the NGOs concerned with WTO issues be heard. I agree that on the whole the United Kingdom Government, the EU and the WTO itself have been open on those issues. However, as I insisted just a moment ago, still more information needs to be disseminated to target audiences if hostility through lack of understanding is to be progressively reduced.
That is one of the many reasons why the WTO needs more resources. My noble friend Lord Tomlinson referred to that. Its entire budget is no more than the United States' contribution to the Food and Agriculture Organisation. That is ridiculous. The report rightly praises the secretariat for managing as well as it does on such limited resources and insists that the European Union must demand that WTO financing by member countries is put on to a much surer footing.
Another resource constraint is in the provision of sufficient finance and expertise to build up the capacity of the developing countries to implement agreements
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already entered into in the Uruguay Round, as well as future agreements. That should not fall exclusively on the developing countries. Many will have neither the financial resources nor the expertise to manage. This is a prime area for co-ordination among the relevant international organisations. The so-called integrated framework—a programme of co-operation to provide technical assistance—has been in existence since 1997, but it appears to have done almost nothing and to have been virtually forgotten. Financing is doubtless the problem. As our report says, the EU must press for a resolution to the problem. The steps taken in early May to set up a special procedure to resolve the implementation issues are a promising, sign. We hope that that process will not wither on the vine.
As the report states:
"If developing countries are to he persuaded to continue to co-operate in the multilateral trading system, they will need to be convinced that the system has the ability and the will to understand and address their problems".
That goes far beyond the implementation of the Uruguay Round. As the report insists, it is crucial that the EU should continue to do everything possible to make the new round a real development round.
The EU waxes eloquent on that point in its mandate, but there is an age-old legal principle that a plaintiff must come to court with clean hands. If the EU wants co-operation from the developing countries, it cannot continue to avoid changing its agricultural policies to prevent the damaging dumping of its surplus on world markets and must permit access to its markets for the agricultural exports that are the economic lifeblood of so many developing countries.
As other noble Lords have pointed out—it cannot be said too often—if the EU continues to insist that the next round must be an "anything but agriculture" round, it will fail. The CAP must be reformed anyway to ensure that an enlarged European Union does not sink under the weight of its costs or see the new members revolt against the lack of fair access to its benefits.
Reform is also crucial to the global trading system. The European Union claims that the shift from market price support to blue box payments has resulted in a major decrease in the trade impact of CAP support. I agree with the noble Lord, Lord Lea of Crondall, that there has been movement following the Macsharry reforms. However, the system still distorts trade and must be reformed. Just a few days ago, on 30th June at the WTO talks on agriculture, the United States made it brutally plain that it and the Cairns Group want the complete elimination of farm export subsidies by a fixed date. I listened with great care to what the noble Baroness, Lady Byford, said. I agree that the US subsidises its farmers, but puts it under a different name. However, that does not stop the Americans telling the European Union that it has to abolish its subsidies. They will not give up easily until they have seen some progress. The European Union must see the writing on the wall and read it carefully.
The EU must seriously consider giving a lead by allowing duty-free access to all imports from the least developed countries, not just "essentially all", which is

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the current formulation. That is a cop-out, the long-term costs of which to all participants in the global system will outweigh the short-term gains to the few.
My penultimate remark is that the report is right to point to the real danger of overloading the WTO with responsibilities that would more appropriately be borne by other international organisations. Issues such as labour standards and the environment are highly contentious and risk allowing too easy resort to contingent protection through sanctions. That burden should not be placed on the WTO. The issue should be handled elsewhere and must be the subject of domestic policy improvements, freely embraced and respecting levels of development and cultural sensitivities, as my noble friend Professor Lord Parekh said in his remarkable maiden speech. They must not be forced on developing countries as absolute conditions for full participation in a liberal trading system.
Finally, the report gets it absolutely right when it insists that we must not rush into a new round. The interim package put forward by the quad countries—the EU, the US, Canada and Japan—in March may, in the words of my right honourable friend the Secretary of State for International Development, be "a confidence-building measure", but it is surely not yet enough for a relaunch.
I do not know what got into the heads of the EU and the US when they agreed to try to launch a new round this year—a year of presidential elections in the United States and feverish activity in the European Union as it moves towards crucial decisions on enlargement to be made at the Nice summit. There are many lessons to be learnt from the Seattle failure and hard decisions to be made by all member states on issues such as strengthening the WTO, as well as a lot of thinking to be done on how to make a new round work. All those issues are prerequisites for a successful launch. The Government should mark well what this excellent report says.
Lord Beaumont of Whitley: My Lords, before the noble Lord sits down, he said that Mr Stoler gave several reasons why the WTO should not be part of the UN system. In fact he gave only one, although he mentioned that there were others. That reason was the different costs, in the broadest sense, of entry to the two forms of organisation. No doubt the committee had good reasons, but it appears not to have explored that evidence or attempted to ascertain its validity. I hope that the noble Lord agrees that that issue was not sufficiently explored.
Lord Grenfell: My Lords, the issue was not widely discussed in the sub-committee, partly because there was instant agreement that the WTO was better placed outside the United Nations system.
1.47 p.m.
Baroness Williams of Crosby: My Lords, this has been an excellent debate. I congratulate Sub-Committee A on its excellent report. As well as congratulating the Clerk on a sterling piece of work, I
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congratulate the chairman of the sub-committee, the noble Lord, Lord Tomlinson, on this well organised and very difficult study. The complexity of the subjects covered in the report evoked my admiration. Having once had the great delight of serving on Sub-Committee A, I wish that I had been there.
However, I suggest that the committee holds one more brief session before moving on to its next study. Having heard debates on a number of EU scrutiny committee reports, I feel strongly about their extraordinary quality and value and the inability of the media to cover them. A look round the Chamber shows how much attention we are likely to get from the newspapers. Sub-committees and committees of the House must make the wider publication of their reports an objective. If that means that they have to ask to appear and give oral evidence before the appropriate parallel committees of other legislatures such as the European Parliament and the US Congress or that they approach the BBC and other international media bodies to create broadcasts dealing with the issues raised, so be it.
I believe too that we are somewhat behind the curve when it comes to attracting attention to and disseminating our conclusions. That is the next step which our committees should take. I say that because I believe that this report would have an excellent influence on the very governments it addresses with regard to rushing the next round and the disastrous consequences which that may bring in its train.
I do not wholly share the criticism that has been made of the NGOs at Seattle for one reason and one reason only, and on this I may have the support of the noble Earl, Lord Sandwich. Although one can question their methods, the NGOs obliged the WTO to look again at the issue of systemic reform. Systemic reform seems to be crucial if, as the noble Lord, Lord Parekh, said, in his excellent maiden speech, the system is to carry the confidence and trust of the great majority of trading nations.
The great danger to it is not that the system is wrong. It must be right to have a rules-based system of global trade. The worry is that those countries which consider themselves to be unfairly treated by the system may withdraw their support for it. As the noble Lords, Lord Tomlinson and Lord Lea, implied in their speeches, it is absolutely crucial that the great majority of sensible developing countries believe that the system works for them and not against them. I recently attended the OECD forum and I am not at all persuaded that that is currently true.
Therefore, what do we need? The report reflects on that. We need to address the issue of the representation of developing countries. In some of the evidence given to the committee, one of the disturbing factors which has not been much debated today was the use of the so-called green room for informal settlement of differences. I shall not use the word "disputes" because that is obviously a more formal procedure.
I read the report and the evidence extremely carefully. The situation arose in which the chairman of the Ministerial Council of the WTO had the right to

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decide who entered the green room. Her choice left out some 110 countries. That situation is bound to elicit deep distrust on behalf of those countries which simply were not there. So the first matter which the WTO must address before any new round is started is how the developing countries can be properly represented, whether by grouping them or in some other way, so that they do not feel that the process excludes their interests.
The second point that I want to make is drawn attention to in an excellent piece of evidence given by Oxfam to the committee. The report states:
"In Oxfam's analysis, a key factor behind unbalanced WTO agreements has been the unequal negotiation power of members".
It is not only that in some cases members were not even represented in the green room; it is also that when they were they often suffered from inadequate advice and expertise. So the second point about the systemic reform of the WTO which is now required is the question of who makes the rules and how the developing countries can play a greater part in that.
In that respect, one of the challenges which we must meet is how to help developing countries to be properly represented. I am aware that this month there has been a press release from the WTO about the efforts being made to assist developing countries in representing their interests in the legal structures of the WTO. But what is being proposed by the donor countries is 20 million dollars over three years. I made a quick estimate and I worked out that that would pay for just 20 lawyers per year at the level that a highly professional American lawyer is paid. So we can see that we are quite a long way away from the effort which is actually required to give developing countries the opportunities they need to be heard.
In that respect, I share some of the doubts expressed by my noble friends Lady Sharp and Lord Taverne about the move with regard to intellectual property and in particular patenting as a universal principle. Again, patenting as a universal principle must be right but the difficulty is that there are literally dozens of countries which have no idea at all how to go about patenting their own inventions and inherited advantages.
I give just one example. At present countries which are seeking to protect the biodiversity of the rain forest, which sustains many forest peoples, some of them indigenous, simply do not know how to go about protecting what is part of their traditional knowledge and are frightened that that traditional knowledge will simply be exploited by major multinational companies. I agree with CAFOD and other NGOs that we should think hard about whether life forms should be open to patenting, given their significance for many of the poorest countries in the world.
One aspect which has been touched upon by my noble friend Lord Sharman and others was that of transparency. I add one other thought to what has been said already. It is important that the WTO should make an annual report; that that annual report should be made available to the parliaments of its members states; that chambers like this one should be able to
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discuss such an annual report. In respect of transparency, it is equally important, as my noble friend Lord Sharman and the noble Lord, Lord Grenfell, said, that we should advance and support very strongly the system of mediation and consideration of public hearings in respect of the dispute procedure.
I turn now to the general agreement on trade of services. I agree with what the noble Lord, Lord Freeman, and my noble friend Lord Sharman have said about that. In a knowledge-led economy, the movement of experts, of people with knowledge and skills, is absolutely crucial, particularly if the world is to benefit from that knowledge-based economy. I shall be very blunt. It is high time that the EU and to a lesser extent the United States began to address the issue of the movement of people. We all know the element of fear that is aroused when countries think that they will be swamped by huge movements of population. But we are allowing ourselves to get into a situation where we defend the fortress of our countries against virtually any movement. That is hound to operate against the most successful outcome for the global economy as a whole.
I refer in passing to the amazing development of software engineering in countries like India, which will be of benefit to the whole world, but not if the world turns its face against the movement to other countries of any of those software engineers on, I hope, mainly a short-term basis.
I do not wish to delay the House and so I shall make brief reference only to three final points. The first concerns the issue of PPM—production, process and marketing. In that context, I wish to make two comments. First, consideration must be given to environmental issues. We have not discussed that as much as I had hoped in this debate, but, as Oxfam points out, there is often a conflict between the legitimate desire to liberalise trade and the legitimate desire to protect the environment.
Anybody who travels widely in the developing world, as many of your Lordships do, must he aware of the devastating effect of cash crops on forestation and on the fertility of the earth. One has only to look at places like Nepal and the steady extension of plantation crops in much of South-East Asia replacing natural forest to see that there must be a better balance than that which is currently likely to emerge from the single-minded pursuit only of growth for its own sake. It is not growth but sustainable growth which should be our watchword.
The second point is that I agree with the noble Lord, Lord Grenfell, and others that the EU must face up to the need to reform the common agricultural policy. In that context I agree with the noble Lord. Lord Bruce of Donington—perhaps this is the only point on which I agree with him—that it is vital to end subsidised exports to the developing world that destroy many of their possibilities and opportunities for trade.

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Thirdly, and finally, I turn to this country. International trade is an issue that goes wider than the scope of the Department of Trade and Industry. It involves relations with all the other major global institutions such as the World Bank, the International Monetary Fund, the United Nations and UNCTAD, all of which are now directed towards the alleviation of global poverty.
The current Chancellor of the Exchequer has a distinguished record in trying to fight to relieve the heavily indebted countries and for education and health to be protected from budgetary cuts that may arise as a result of budgetary problems. Through the Chancellor, I would like to see the UK argue that there has to be a broad approach to these issues and that that must put at the forefront the need to rescue the poorest countries of all from consequences that we, who are stronger and more prosperous, can easily take on board. If we do not protect that small group of countries—not more than 40 or 50—at the bottom of the heap, the warning given in the impressive maiden speech by the noble Lord, Lord Parekh, whom we are delighted to hear in the debate, could well become a reality and we may face the alienation and fundamentalism of people who feel that the global order has nothing to offer them. It has much to offer them, but we need to be able to explain that to them and we need to be able to take their interests on board more than we do at present.
2.1 p.m.
Lord Northbrook: My Lords, we are all grateful to the noble Lord, Lord Tomlinson, for securing the debate on this important Select Committee report. I congratulate noble Lords on their contributions, particularly the noble Lord, Lord Parekh, on his fine maiden speech. I endorse the comments of the noble Baroness, Lady Williams of Crosby, that it would be good if the contents of the report were circulated to a wider public by way of the BBC, other media, newspapers or other publications.
Compared with other members of Sub-Committee A, I am a newcomer to the subject. First, I have to declare an interest as a farmer and investment fund manager in the City.
The collapse of negotiations in Seattle was a great disappointment to Members on these Benches. The talks were shrouded in controversy from start to finish with protest groups disrupting procedures. I support the remarks of the noble Lord, Lord Lea of Crondall, about the role of NGOs in the proceedings. Member states could not find agreement on an agenda for a new trade round in Seattle. The current limited agenda, which focuses on agriculture and services, agreed in 1993, will now go ahead as normal. Noble Lords on these Benches support the target of global free trade by 2020. We are disappointed that the talks did not make genuine progress towards that target and we call upon the Government to renew the fight to cut EU tariffs and to make a strong commitment to free trade.
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The Government make much of their influence with the EU but that influence appeared entirely lacking in the Seattle negotiations. As the report concludes, they should have encouraged other members of the EU to narrow the range of issues to be addressed in the round. As many noble Lords have said, the EU should have concentrated on the issues where progress was most likely to be achieved rather than looking for trade-offs on the broadest possible canvas, for example, getting involved in intellectual property rights, labour standards and the environment.
That would be facilitated by the EU making sensible changes to the common agricultural policy of its own accord and in advance of the next round rather than keeping them as bargaining counters. As many speakers have said, Europe's common agricultural policy is unsustainable in its current form, especially with the likelihood of enlargement. We, on these Benches, support radical CAP reform, but on the basis, as my noble friend Lady Byford stated, of a level playing field. That would mean shifting support payments away from production subsidies and towards income support measures that do not directly interfere with price levels.
Another option is to convert price subsidies into direct payments for public goods that the farmers provide; for instance, the maintenance of valued landscapes. Overall, it is clear that the matter of agricultural subsidies dogged the debate. In the words of the Seattle Times, the US and EU were at loggerheads over how far to go in reducing trade barriers in farming. It must not be forgotten, as has already been stated, that the US subsidises its farmers but often under a different name.
Looking in detail at the summary of the opinion of the committee, we on these Benches agree with many of the conclusions. There is a statement that the benefits of increasing world trade within a "rules-based system"—not cowboy capitalism, as the noble Baroness, Lady Sharp, stated—can and ought to outweigh benefits for all parties. The committee states that there is a need for international organisation to agree the principles on which the rules are to be based and to set and police the rules. That was the original basis of GATT, the predecessor of the WTO, with its emphasis on reciprocity and equal treatment for all trading partners.
We on these Benches broadly support the EU negotiating position on the desirability of further trade liberalisation. We agree with the report's view that the largest economies stand to gain the most, in absolute terms, from liberalisation. I was interested to see the table on page 9 of Volume I of the report showing the gains anticipated from trade liberalisation and putting the EU at the top with a gain of 92 billion dollars and the US at 45 billion dollars.
But developing countries are also likely to make substantial relative gains. The rules-based system, in our view, prevents a slide back into protectionism and strengthens the position of parties with less bargaining power. Therefore on these Benches we concur with the

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EU's reaffirmation of the multilateral trading system and of its basic principles as guarantees against protectionism and unilateralism.
A particular example of protectionism is tariffs. British consumers have to pay 8.9 per cent extra for chocolate from outside the EU because of the EU's common tariff wall; they pay 9.7 per cent for biscuits for the same reason; an extra 9 per cent for rice; 4.7 per cent for dolls; 12.8 per cent for clothes; 8 per cent for video recorders and 2.7 per cent for pens. In all the EU imposes a scarcely credible 15,600 separate tariff duties.
A large proportion of the revenue from that tax on consumers must be spent on merely collecting it, and the rest probably pays for the EU's programme of wasteful bureaucracy. The Government should demand that the EU drop those tariff barriers that cost the EU economy £300 billion a year. We call on the EU to show that it is serious about free trade by making a serious unilateral offer to cut or abolish a significant number of those tariffs, contingent only on multilateral acceptance of an agenda for the millennium round that would achieve dramatic steps towards tariff-free trade.
Looking further at the conclusions of the committee, we agree with the assumption in the EU mandate that globalisation accentuates the need for a rules-based trading network and that only an international organisation like the WTO can provide it. As the report rightly states, it is companies, not countries, which trade. As a result, the liberalisation of trade needs to be considered in conjunction with other issues and not in isolation. And the WTO needs to work in co-operation with other international institutions so that each can fulfil its proper function within the framework of international governance. We agree that the EU should press for a process to be established to achieve that.
The committee makes another major point; that is, that under the EC treaty it is inevitable that the Commission will negotiate in the WTO on behalf of member slates. It is, however, as other speakers have commented, important that the Commission should act strictly within the limits of its authority and, again to echo other speakers, it is disturbing that some important decisions have been taken without reference back to member states.
The report quotes two key examples where that problem occurred. In the first there was a well-publicised case in Seattle where Commissioner Lamy agreed on behalf of the EU that there should be a WTO working group on biotechnology whereas the position of the member states was that that issue should be treated separately. The second example, already referred to, arose during March 2000 when chairs of various WTO groups were being appointed for the next year. The Commission blocked the appointment of the highly respected Brazilian ambassador to the WTO, Mr Celso Amorin, as chair of the group to take forward the negotiations on the built-in agenda to agriculture, reportedly on the basis that the country concerned formed part of the Cairns
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group. That decision went down badly. According to the UK trade Minister, Stephen Byers, the UK would have been happy to accept the Brazilian ambassador, but,
"as part of the European Union there was a view that it would not have been helpful to have a leading member of the Cairns group chairing those negotiations at that particular time".
The report goes on to another issue: that the voices of the social partners and of the non-governmental organisations concerned with WTO issues should be heard. The report believes that they have been. Social partners and NGOs included trade union members and Mrs Hilary Colby, chair of the UK NGO network. The views of Friends of the Earth were canvassed. The report states tellingly:
"It seems [to the committee] that the UK Government, the EU and the WTO itself have been commendably open over the issues, and that the complaints of NGOs about lack of transparency must sometimes be interpreted as complaints that their lobbying does not have the desired effect".
Finally, we support the proposition detailed in the report that the Government should involve Parliament as closely as possible in their preparations for WTO negotiations.
I conclude by saying that we on these Benches welcome the excellent report of the committee chaired by the noble Lord, Lord Tomlinson. We believe that it lives up to the fine traditions of this committee.
2.14 p.m.
Lord McIntosh of Haringey: My Lords, I join other noble Lords in welcoming the report of the European Union Committee on the EU's mandate on the WTO following Seattle. I congratulate all noble Lords who have taken part in this excellent debate, notably my noble friend Lord Parekh on an extremely thoughtful and well-argued maiden speech. There is much with which we can agree in the report. Of course, we are, by convention at least, bound to reply to the report within two months. But I can make two comments in that respect. First, this debate will form part of the evidence that we shall take into account for the response that Ministers will make; and, secondly, we are working very hard to ensure that Ministers approve a response and that it is published before Parliament goes in to its Summer Recess. I hope that that will be helpful both to the committee and to noble Lords.
The committee's report makes it clear—and the Government fully agree—that a second failed attempt to launch a round would be very damaging for the world trade system. If we are to have a successful launch next time, we certainly agree that the correct political conditions will need to be in place, as well as an agreement on an inclusive agenda reflecting the interests of all WTO members. However, I shall return to the issue of timing, which is the critical issue and one in respect of which we may not be fully in sympathy with the committee, at the end of my remarks.
We believe that it is important for us to press ahead with work towards a successful launch of a new round of trade negotiations as soon as possible, with parallel work on the reform of the WTO. Like all who have spoken, we believe that a comprehensive round is in

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the best interests of all WTO members and of sustainable development. All countries can get something from a comprehensive round, notably the prospect of greater liberalisation of trade.
As has become clear in this debate, and, indeed, over the past nine months, there are far too many myths about the World Trade Organisation—the myth that it is undemocratic; that it is only there for big business; that it is bad for the environment; and bad for developing countries. I believe that those myths were very well rebutted by my noble friend Lord Parekh, but they still appear to be there. Moreover, as many noble Lords said, there remains poor public understanding of what the WTO is and what it does. That became very apparent at Seattle, or rather outside the meeting places in Seattle, where idealistic young people joined with hard-bitten, rust-belted trade unionists from the AFL and the CAO to protest, from entirely opposing points of view, against this most valuable organisation. It was the protests that made the headlines more than the failures within the conference chambers. But I do not believe that those protests accurately reflect the functions of the WTO. Indeed, they reinforce false arguments and scare stories about trade liberalisation and globalisation.
Trade liberalisation and the WTO do not benefit big business only. A prosperous world economy, with a rules-based world trade system on which the committee is entirely agreed, benefits producers of all sizes. It benefits small and medium businesses, not just large companies, and enables them to trade freely and with confidence. The exposure to international markets is one of the most important spurs to innovation and improving competitiveness. Nor does the WTO benefit rich, developed countries only; it offers equal rights to all trading organisations to the particular advantage of the smaller states in the global system. As has been said this afternoon, it is unique in that way and that is very much in contrast to other international organisations.
Unless we have a multilateral rules-based trading system, smaller countries will be unprotected against the greater trading weight of larger economies and some of the large multinational companies that are larger than the economies of the smaller countries. With WTO rules, we have to provide a basis upon which the world's major power blocks can handle their disputes without disruption and all the damaging consequences that would arise therefrom. Most of the day-to-day work of the WTO, which does not get reported—like the work of the committees of your Lordships' House—is directed at all of its members, especially developing countries and the members of those societies. My noble friend Lord Parekh is right to say that they need more aid and advice. The work must go on, Seattle or no Seattle. I believe that we can agree—I agree here with the noble Baroness, Lady Sharp, and the noble Lord, Lord Taverne—that for the less developed countries there must be clear benefits in prospect for a new round.
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I turn to the EU mandate. A small minority of speakers today—notably the noble Lord, Lord Bruce of Donington— have expressed the view that the United Kingdom should not submit itself ("submit" is a prejudiced word, but he probably did not use it anyway) to the European Union mandate. We have worked for many years to secure that the European Union mandate not only benefits Europe and the world but also benefits this country. It always has done. It has particularly benefited UK exports. Our support for a European Union mandate—I do not think that the committee even questioned this—is fundamental to the way in which we play our part in the World Trade Organisation.
We support the mandate's recognition of the
"need for an 'appropriate balance' between trade liberalisation and the other desirable objectives referred to in the negotiating position".
However, the report suggests that the European Union mandate should be reopened before the launch of a new round. The Government do not agree with that. We remain in support of the agreement at the informal Trade Ministerial held in Porto on 17th and 18th March of this year that the conclusions reached at the October 1999 General Affairs Council remain valid. The noble Lord, Lord Tomlinson, asked today for a review at ministerial level. That was a review, although informal, at ministerial level. We believe that the conclusions contain the necessary flexibility for the Commission to negotiate an agenda for a new round which is acceptable to all WTO members. At Porto, Ministers agreed that the Commission should continue intensive work on the launch of a round later this year.
Clearly the way in which we approach the new round must include the preservation of the transparency and the good relationships with NGOs which were perhaps almost the only good features of Seattle. The report concludes that the WTO
"is remarkably transparent compared with many other institutions".
We in the UK need to ensure that global institutions, such as the WTO, command public support. Their proceedings need to be transparent and their roles need to be better understood. The Government support greater transparency. We are working with our EU partners to look at ways that this can be improved. That might include further de-restriction of WTO documents, an increased use of the Internet, and wider consultation by the WTO secretariat.
Whether the negotiations themselves should always be held in public is quite another matter. When we discuss that issue we have to bear in mind the sensitivities of other countries and include the sensitivities of the less developed countries. The inclusion of NGOs—the United Kingdom took a lead at the Seattle conference in that regard—should, and has been, continuing. We met with representatives from NGOs, business, labour, local government and consumer groups to discuss WTO issues in the run-up to a new round. These meetings have taken place since the beginning of the year and they will continue.

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I turn to the issue of coherence; in other words, co-operation with other international organisations. After the Joint Statement delivered by Moore (WTO), Camdessus (IMF) and Wolfensohn (World Bank) in Seattle, the United Kingdom has been following closely the implementation of this commitment to greater co-operation in delivering capacity building and technical assistance. There has been further work on this at official level in the G7/8, particularly with a focus on trade, finance and development. The widening of the trade agenda to include investment, financial services and domestic regulatory areas will lead to greater overlap between the work of international bodies and we will need more policy consistency at national and international levels.
However, these proposals are for policy consistency rather than for the kind of meta-international body which the noble Lord, Lord Biffen, fears and the noble Lord, Lord Freeman, hopes for. We are a good way from that kind of mega organisation which would supplant the existing international financial institutions. Certainly, any initiative for greater co-operation between the international financial institutions must come from the member states and it must be consensus driven.
We agree with the committee that the WTO secretariat is performing well and we are pleased to see the acknowledgement in the report that the UK is one of the member states which is giving adequate financial support to the secretariat. But I fully understand the point of the noble Lord, Lord Grenfell, about the need for security in future funding.
I turn now to the vexed issue of agriculture, which understandably took up a considerable part of the debate. Negotiations on the WTO agreement on agriculture were mandated under the Uruguay Round and are now under way. The WTO agriculture committee, meeting in special session, has called for proposals for the negotiations from members by 2000. I am sorry that I am not able to follow the noble Lord, Lord Taverne, into a debate on genetically modified foods, much as I would like to, as he knows from our previous debates on the issue.
The agriculture negotiations will focus on the liberalisation of agricultural trade and further reductions in agricultural support. To put it mildly, this sits well with our objectives for the further reform of the common agricultural policy, which has been urged so strongly by many speakers in the debate. The EU agriculture council has said that the decisions adopted within the framework of Agenda 2000 constitute essential elements of the EU position for the WTO negotiations, with the EU's policy being founded on the full Agenda 2000 package and will include—and must include—reviewing some of the key CAP commodity regimes over the coming years.
It was good to have the reminder from the noble Lord, Lord Grenfell, that enlargement will eventually undermine many of the bases on which the common agricultural policy at present exists. I fully understand the disappointment of the noble Baroness, Lady Byford, and of the noble Lords, Lord Bruce and Lord
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Northbrook, and others, at the slow pace of reform of the common agricultural policy. I agree with the noble Lord, Lord Northbrook, that the UK, in pressing for further reductions in production-related support, has consistently emphasised the importance of accompanying targeting measures to conserve and enhance the rural environment and to protect the rural economy. We support further liberalisation of agricultural trade in order to be able to support sustainable development and economic growth worldwide and to improve opportunities for our own exporters.
I hope that noble Lords will forgive me if I do not spend time on the banana dispute. I can possibly justify that by saying that diverse views have been expressed on that issue and that the Government are continuing to work on it.
Baroness Williams of Crosby: My Lords, I hope the noble Lord will forgive me for intervening. I want to ask him one direct question before he moves on from the banana dispute. What is the Government's position on the proposed carousel sanctions, given that some firms have suffered hugely from being targeted?
Lord McIntosh of Haringey: My Lords, carousel sanctions are particularly damaging because they can destroy an industry, such as the Border's fine woollens industry, and then move on to another industry, such as some forms of packaging, without giving the original target a chance to recover. Therefore, carousel sanctions are particularly damaging. They have been damaging in relation to the banana dispute. The only way in which we can alleviate the burdens on all the companies facing possible US sanctions is to find a solution to the banana dispute satisfactory to all parties. We have been among the strongest voices in Brussels pushing for a solution. As such, we would not have expected the United States to target sectors that will hit UK industry. We have been able to lobby the US hard to get this message across. The Secretary of State for Trade and Industry spoke to the. US Ambassador on this matter as recently as last month.
The other sector which attracted as much attention as agriculture was, quite properly, services. We are the second largest exporter of services, next only to the US. We have a major offensive interest in securing an ambitious, liberalising negotiation in the WTO. We have been one of the strongest advocates in the EU for early progress on market access negotiations.
We need to maintain a comprehensive approach to the "GATS 2000" services negotiations, from which no service sector or mode of supply is excluded a priori. We have many interests in many service sectors and we would not want to give other countries which are also sensitive to these matters any excuse to remove these sectors from possible negotiation. But the benefits from service liberalisation apply to all WTO members, including developing countries. It promotes more efficient, competitive and varied services and helps to attract inward investment. I fully agree with the noble

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Lords, Lord Freeman and Lord Sharman, and the noble Baroness, Lady Williams, who talked about the freedom to work abroad being important for services.
We are still making progress on service negotiations under the built-in agenda. The negotiations formally started on 25th February. The WTO Council for Trade in Services formally agreed on a work programme for the first phase of the negotiations covering the period until March 2001. Therefore, I can say to the noble Lord, Lord Freeman, that those negotiations are not stalled, as he seemed to think they were. We are starting to get proposals for negotiations, for example, in the area of tourism, energy and environmental services.
The Government believe that it is very important that investment should be included in any WTO new Round. The Select Committee's recommendations on investment largely reflect our thinking. The EU objectives are long term. Our immediate priority is to begin negotiations. We are doing so within the WTO Working Party on Trade and Investment. It follows from investment—the noble Lord, Lord Sharman, made this valuable point—that we should be adding competition to the agenda. That is being properly and effectively led by the European Commission.
We agree basically with what the report says about intellectual property issues. One of the major issues is the time that is necessary for developing countries to implement the standards of the TRIPS agreement. The deadline was January this year but it is only being felt at the present time. So we do not think that this is the right time to seek revisions of the standards set in the agreement. The least developed countries still have five years to introduce the existing standards. However, we recognise the value of what was said by my noble friend Lord Tomlinson, about the humanitarian concessions made by United States pharmaceutical companies, among others.
Many speakers discussed trade and labour issues, as well as social standards and whether a social clause should be included in the WTO. We think that there are real dangers here. This could mean the WTO acting in areas where other international institutions have primacy, in particular the International Labour Organisation. I can confirm our view to the noble Earl, Lord Sandwich, that it is important that we do not try to make the WTO solely responsible for dealing with environmental and social issues. We need to ensure co-operation between the WTO and the ILO, the Bretton Woods institutions and the United Nations bodies. Here I agree with my noble friend Lord Lea, not least because he agrees with what I said on 19th April; namely, that the EU position is that there should be a joint WTO/ILO standing forum which would be outside the WTO structure.
I do not have anything specific to add to the issue of dispute settlements. I have referred to the issue of public hearings. Of course I understand the point made by the noble Baroness, Lady Williams, about the need for greater funding of the legal advisory centre.
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However, we were the instigators of the legal advisory centre and I think that we should be given credit for that.
In closing, I should like to refer to the only area where we may be in contention with the committee; namely, the issue of the timing of the next comprehensive round of trade negotiations. We believe that, given the benefits which a new round could give, we should continue to press ahead to launch a new round as soon as possible. We do not differ on the importance of learning lessons from the Seattle conference. We support Mike Moore and Ambassador Bryn's consultation with the WTO members in Geneva, which includes issues such as reforms surrounding internal transparency and the effective transparency of WTO members. The next step in that process will be a general council meeting next Monday, 17th July.
Given the importance of allowing sufficient time for preparation, parallel work on reform of the WTO should enable us to do this. We continue to believe that we should make efforts to launch a round as soon as possible. I simply cannot agree with my noble friend Lord Desai that we should wait for a new US president to settle himself or herself in. I do not believe that any such excuse for delay, which could occur in any country in the world and could be based on political or economic events, should be allowed to delay a round which could result in huge benefits for the world in terms of economic and trade liberalisation.
In conclusion, we agree with a very great part of the report, in particular on the benefits of the rule-based system for free trade. We believe that significant worldwide benefits will flow from further trade liberalisation, from which all major regions of the world would gain and significant worldwide income gains would flow. The Government are grateful to all those who took part in the preparation of the report and to all who have taken part in this debate.
2.38 p.m.
Lord Tomlinson: My Lords, I shall be very brief. This has been an excellent debate. I should like, first, to thank all noble Lords who have made their valuable and much valued contributions. Normally it would be invidious to refer to individual contributions, but I am sure that the whole House would want me to pay tribute to my noble friend, Professor Lord Parekh, who has sent his apologies. He had to leave the House just before the closing speeches. My noble friend made a quite remarkable maiden speech and I am sure that it added greatly to our deliberations.
Equally, I am sure that the members of the committee will support me next week, when in both Sub-Committee A and in the Select Committee, I take up the points made by the noble Baroness, Lady Williams of Crosby, as regards the necessity to look at the dissemination of the conclusions of Select Committee reports in this House. It is a necessity of which we are all conscious.
My final point has slightly more political substance. I thank my noble friend the Minister for what was an inevitably partial reply to the debate. However, I must

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put a couple of points to my noble friend, as he said that the debate would be taken into account by the Government as evidence in determining their reply to this House.
First, on the question of a ministerial review of the mandate, there will have to be a substantially better explanation of the role of the Article 133 Committee for us to accept that as being the equivalent of ministerial review. Members of the committee are unanimous in their belief that there should have been a ministerial review of the mandate, even if it was only to say that, having reviewed it, the Government reconfirmed it.
The second point that I should like to make to my noble friend, again in the spirit in which he replied to the debate, concerns the timing of the next ministerial conference. I believe that I speak with the authority of all members of Sub-Committee A in asking the Minister to convey this message to the Government: quite simply, we think that you are wrong, and we urge you to take that view more fully into account when you examine the evidence of the report. That said, I sincerely thank my noble friend for his contribution to the debate.
On Question, Motion agreed to.

Divorce (Religious Marriages) Bill [H.L.]
2.41 p.m.
Read a third time.
Clause 1 [Refusal of decree absolute on grounds of non-dissolution of religious marriage]:
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 1:
Page 1, line 10, leave out ("26(1)") and insert ("26(1)(d)").
The noble Lord said: My Lords, in moving this amendment, I shall speak also to Amendment No. 2. The amendments stand in the name of the Lord Chancellor.
At Second Reading, I, and in Committee the noble Lord, Lord Bach, indicated the Government's support in principle for the Bill. As I said at that time, we have received advice from counsel that the Bill is not compatible with Article 14 of the European Convention on Human Rights in that it discriminates on grounds of religion. For that reason, the Government have tabled these amendments to ensure that the Bill is compatible with the convention.
The effect of the first amendment is to confine the provisions of the Bill to the Jewish faith in the first instance. The second amendment would allow the Lord Chancellor to add other faith groups as and when appropriate. The Government seek to take this action as, at present, only the Jewish community has approached the Government for this remedy. In the circumstances, it would be inappropriate to confer rights on all faith groups without evidence that the provision would be welcome to them. The second
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amendment will allow other faith groups, if they wish, to put a case to the Government to have the provision extended to them. I beg to move.
Lord Lester of Herne Hill: My Lords, we are grateful to the Government for having subjected the Bill to careful scrutiny—among other things, against the standards of human rights. As the Minister explained, the amendments recognise that Britain is a plural society in which people of different faiths and no faith at all should be treated with respect and equality.
The amendments give rise to no difficulty so far as concerns delegation. We have the benefit of the report of the Select Committee on Delegated Powers and Deregulation to that effect. The provision sensibly authorises the Lord Chancellor to add other faith groups in the way that has been explained if, and only if, after consultation, other faith groups wish to have that benefit.
It seems entirely healthy that the Government have on this occasion been prepared to disclose their legal advice. I explained on an earlier occasion that I did not altogether share the view that the Bill was not strictly compatible. That does not really matter. What the Bill now does is make sure that it does not authorise any discrimination. In those circumstances, we greatly welcome these sensible amendments.
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 2:
Page 1, line 13, at end insert—
("(1A) This section also applies where the parties to proceedings—

(a) were married to each other according to religious usages of a kind prescribed in an order made by the Lord Chancellor; and

(b) are required to co-operate if the marriage is to be dissolved in accordance with those usages.").

On Question, amendment agreed to.
2.45 p.m.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendment No. 3:
Page 1, line 16, leave out ("is").
The noble Lord said: My Lords, with Amendment No. 3 I should like to speak also to Amendments Nos. 4 and 5. These are procedural amendments which allow the parties to the application to know exactly what is required of them to satisfy the court that they have taken all the necessary steps to dissolve the religious marriage. Specifically, Amendment No. 3 is a minor drafting point to aid statutory interpretation. Amendment No. 4 provides that the declaration be produced to the court. This is a significant step in the process. Without the declaration, the court will be unable to verify whether the religious marriage has been dissolved and therefore make an informed decision as to whether to issue the decree absolute.
Amendment No. 5 will allow for rules of court to specify the form and requirements of the declaration. This will help the court to adopt a unified approach and make clear to the parties what is required. The amendment also provides that where a declaration has been found to be inaccurate after the divorce is made absolute, that will not affect the civil divorce. Equally, any financial and childcare provisions arising from the civil divorce would not be adversely affected. Amendment No. 5 also sets out the provision relating to any order in this matter to be made by the Lord Chancellor; specifically, that an order must be made by statutory instrument and shall be subject to annulment in pursuance of a resolution of either House of Parliament. I can also inform the House that, as the noble Lord, Lord Lester, points out, the Delegated Powers and Deregulation Committee has not raised any queries about the delegated power extended to the Lord Chancellor in making orders to add other faith groups as and when appropriate.
The nature of these amendments is to allow proper procedural instructions to ensure that upon implementation the parties are clear as to what is required of them to comply. I commend the amendments to the House. I beg to move.
Lord Lester of Herne Hill: My Lords, these amendments are also great improvements to the Bill. They achieve greater certainty not only in the law but between the parties. For that reason, I am most grateful.
Lord Simon of Glaisdale: My Lords, can the Minister explain what kinds of requirements are envisaged in new subsection (4)(c)?
Lord McIntosh of Haringey: My Lords, these are matters that may be imposed under rules of court. It is not for Parliament to anticipate what kinds of rules the courts may themselves wish to add.
Lord Simon of Glaisdale: My Lords, that may be something of a blank cheque.
Lord Lester of Herne Hill: My Lords, I do not know whom I may help. I would be the first to raise a criticism if I thought that there was any over-broad delegation or uncertainty. The Select Committee under the chairmanship of the noble Lord, Lord Alexander, indicates that it is satisfied. For my part, I regard the matter as purely procedural. If there were any defect it could be dealt with under the negative resolution procedure. It is important that this Bill be speedily enacted to give quick relief. I and the other backers of this measure would be most upset if, on a technicality, this Bill could not be bid farewell as soon as possible. In what is proposed I see no real vice; on the contrary, virtue.
On Question, amendment agreed to.
Lord McIntosh of Haringey Lord McIntosh of Haringey moved Amendments Nos. 4 and 5:
Page 1, line 18, at end insert ("is produced to the court").
Page I, line 23, at end insert—
("(4) A declaration of a kind mentioned in subsection (2)—

(a) must be in a specified form:

(b) must, in specified cases, be accompanied by such documents as may be specified: and

(c) must, in specified cases, satisfy such other requirements as may be specified.

(5) The validity of a decree of divorce made by reference to such a declaration is not to be affected by any inaccuracy in the declaration.
(6) An order under subsection (1A)—

(a) must be made by statutory instrument:

(b) shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(7) "Specified" means specified in rules of court.").
On Question, amendments agreed to.
Lord Lester of Herne Hill: My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(Lord Lester of Herne Hill.)
Baroness Miller of Hendon: My Lords, Clause 1 of the Bill re-enacts Section 9(3) of the Family Law Act 1996. Unfortunately, that section is in Part II of the Act which, for various reasons totally unconnected with this clause, the Government have not yet brought into effect and may not do so for some time. In other words, the clause is simply in the wrong place; otherwise it would be law by now.
Your Lordships will recall that I had a reservation about the wording. However, I emphasise that I supported the good intention or purposes of Clause 1 of the Bill. That reservation was dispelled by the assurances the noble Lord, Lord Lester of Herne Hill, gave me in Committee.
The Bill, therefore, gives effect to the will of both Houses of Parliament which would otherwise be indefinitely delayed for reasons which are not relevant to this Bill. That would be to the detriment of a number of chained spouses whose problems may be relieved by the Bill. Even if that number is only one, we need to do whatever we can to help where their own religious courts cannot.
In those circumstances, I support the proposal that the Bill do now pass and hope sincerely that it will be given a smooth passage in another place.
Lord Lester of Herne Hill: My Lords, I am extremely grateful to the noble Baroness for her remarks. Her contribution to debates on the Bill has been extremely important. It has made us all think again very carefully. We have now reached the happy position where noble Lords on all sides of the House welcome the Bill. As the noble Baroness, Lady Miller, explained, the will of

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Parliament is already expressed in Section 9(3) of the Family Law Act 1996. There is nothing controversial about this measure; there is nothing involving public expenditure or anything of that kind. It would be presumptuous to say anything about how it might fare in another place. But it is very much to be hoped that it can be dealt with in a way which gives speedy relief and redress to a most unfortunate group of victims of an ancient injustice.
In conclusion, first, perhaps I may express great gratitude to the Government for the spirit in which they have approached the measure and the constructive way in which they have improved the Bill beyond its original form. Secondly, I express gratitude to the House as a whole, including the usual channels, for enabling the Bill to be speedily passed in this House while in no way sacrificing effective scrutiny. With those words, I commend the Bill.
On Question, Bill passed, and sent to the Commons.

Licensing (Young Persons) Bill
2.52 p.m.
Baroness Thornton: My Lords, I beg to move that this Bill be now read a second time.
I feel a welcome burden of honour and responsibility in moving today the Licensing (Young Persons) Bill in your Lordships' House. Its origins lie in the traffic death of a young man. It seeks to address a loophole in the law that could prevent other tragedies. I hope that I shall he able to discharge that responsibility.
I begin by referring to the Second Reading debate in another place on 11th February. Perhaps I may say how much cross-party support the Bill has already received. During the Second Reading debate, Sir Patrick Cormack said:
"In the best traditions of the constituency Member of Parliament, the hon. Member for Pudsey has rightly been deeply moved by a shocking and terrible tragedy, and has sought to do something about it. That is admirable. In doing so as a good constituency Member, he has the support of colleagues in all parts of the House'.—[Official Report, Commons, 1 1/2/00; col. 522.)
Sir Patrick was quite right, and I hope that the Bill will receive support also from all parts of your Lordships' House. My honourable friend the Member of Parliament for Pudsey, near my home town of Bradford, Mr Paul Truswell, is to be commended for the persistence and imagination which he has brought to fighting for and winning through to this point.
I shall, if I may, retell the story of the genesis of the Bill, before I address its details. In November 1997, a constituent of Mr Truswell's, a Mr John Knowles, attended the constituency surgery and told of the harrowing and tragic death of his 14-year-old son, David. David's death highlighted a huge loophole in the Licensing Act 1964, which the Bill seeks to close.
David Knowles was a normal schoolboy, who attended the local high school in Pudsey; a boy from a close and supportive family. He enjoyed maths, and had ambitions to be a bank manager. Those who knew him described him as a serious and normal boy. In
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March 1997, David watched friends play football after school, and on the way home and in the centre of Pudsey, David's friends asked him to go into Thresher's, the off-licence, to buy them some alcopops, because they were still in their football kits. David did this, and Thresher's sold him the alcohol that he asked for.
A few minutes after returning to his friends, David decided that he wanted some alcohol himself, and returned to the same off-licence and bought four cans of lager. Again, he was served without question. The group continued on their way, and in due course they reached an embankment overlooking the local bypass. The bypass is a very busy dual carriageway, with a 70 miles per hour speed limit. It forms part of the Leeds ringroad. It was then that this normally serious and sensible boy, worse the wear after three and a half cans of lager, shouted "Let's run", and ran down the embankment over the first part of the dual carriageway, across the central reservation and onto the Leeds bound carriageway. There, my Lords, a car travelling at high speed struck him, and he died shortly afterwards from the huge injuries that he sustained.
The police attended the scene, and as a result of the statements that they took, they seized the security videos at the Thresher's off-licence. These showed David being sold alcohol twice within five minutes. On the basis of police reports, the Crown Prosecution Service mounted a prosecution against the two members of staff who had sold David the alcohol Unfortunately, the CPS then ran into the loophole in the law which the Bill seeks to close. David's family were thus denied justice. It was discovered that a prosecution could succeed only against the licence holder or in the somewhat antiquated language of the 1964 Act, the licence holder's "servant".
The word "servant" has a particularly narrow definition in law. It must be someone directly employed and paid by the licence holder. In this case the staff of Thresher's were employed by a national company, and not by the licence holder, who happens to be their district manager. The staff were therefore immune' from prosecution. Mr Truswell gave a pledge to David Knowles' family to do everything he could to plug this loophole, and it is that pledge that we are redeeming today.
I have a son who will be the same age as David Knowles in two weeks' time. We all know that boys of this age are often what Mr Truswell and fellow Yorkshiremen would call daft. Even the most sensible, well-balanced and from the most caring homes, like David Knowles, do daft things from time to time. Our job, as parents and in this case, legislators, is to protect them from the consequences of their age and their irresponsibility, and to ensure that the law does its best to do the same.
The CPS in this case based the withdrawal of the prosecution on a Court of Appeal ruling in December 1996 in the case of Russell v. Director of Public Prosecutions. The court quashed a conviction on the basis that the appellant, a trainee manager, was employed by the national company, in this case

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Unwins, and not by the licence holder. Even more remarkable is the fact that this loophole has been known about for 30 years. There have been several failed prosecutions. The law has simply not kept up with the present-day reality of the sale of alcohol in supermarkets and off-licence chains. There now exists, as it were, a two-tier system for off-licence workers. There are those who work for small independent corner-shop off-licences, who are subject to the law, and those who work for supermarkets and chains of off-licences who seem to be immune.
Mr Truswell has campaigned hard on behalf of his constituent's family. He has submitted a presentation Bill, introduced a Ten-Minute Rule Bill, and there have been petitions from his locality, meetings with Ministers and officials, and an Early-Day Motion signed by 120 members of all parties in the other place. There can be no doubt that there is substantial support for the measure.
I shall now turn briefly to the specifics of the Bill. It is a Bill with a simple purpose and in many ways that is its strength. The Bill amends the law in England and Wales relating to the sale and consumption of intoxicating liquor in cases involving young people under the age of 18. The amendment is to the Licensing Act 1964. The Bill substitutes new provisions for Section 169 of the 1964 Act. The new provisions redefine who may commit the offences of selling or knowingly allowing the sale of alcohol to a person under 18 years of age, who knowingly allows the consumption of alcohol by a person under 18 in a bar and knowingly delivering or allowing the delivery to a person under 18 of alcohol sold in licensed premises for off-premise consumption. It also creates a new offence of purchasing alcohol on behalf of a person under 18 years of age.
Clause I substitutes seven new sections for Section 169 of the 1964 Act. The new Section 169A makes it an offence for any person in licensed premises to sell alcohol to someone under 18. Currently, under Section 169(1), only the licensee or his "servant" can commit this offence. That would mean that the staff serving David Knowles would have a case to answer.
New Section 169B makes it an offence for a person on licensed premises, if he works in the licensed premises, whether in a paid or unpaid capacity, which gives him authority to prevent the sale, knowingly to allow another person to sell alcohol to someone under 18 years of age. Currently, only the licensee can commit that offence.
New Section 169C retains the offence under Section 169(2) for a person under 18 to buy, or attempt to buy, alcohol in licensed premises. A new subsection also creates a new offence of buying or attempting to buy alcohol on behalf of a person under 18. No offence is committed in this case if the person proves he had no reason to suspect that the person was under 18. This offence has been referred to in debates in the House of Commons as the offence of "proxy purchase".
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New Section 169D maintains the exception provided by Section 169(4) where the person under 18 is at least 16 and the sale or purchase is of certain kinds of alcohol for consumption at a meal in certain parts of licensed premises.
New Section 169E retains the offence under Section 169(2) for a person under 18 to consume alcohol in a bar in licensed premises. It also makes it an offence for a person in licensed premises, if he works in the licensed premises in a paid or unpaid capacity which gives him authority to prevent the consumption of alcohol to a person under 18 years of age.
New Section 169F makes it an offence for a person who works in licensed premises, whether paid or unpaid, knowingly to deliver alcohol to a person under 18 where alcohol is sold in licensed premises for off-premise consumption.
New Section 169G maintains the offence of knowingly sending a person under 18 to obtain alcohol or to be sold in licensed premises for off-premise consumption.
New Section 169H applies the penalties for an offence under Section 169 to the new offences. The maximum fine is level 3 on the standard scale. The power to forfeit licenses formerly contained in Section 169(8) has been adapted to apply to the offences under the new sections. Convictions for offences under Section 169, as well as convictions for offences under the new sections, will count for the purposes of triggering the power to forfeit, as in current legislation.
Clause 2 makes consequential amendments, adapting references to the existing offences, defences and penalty provisions so as to reflect the new ones.
In conclusion, I want to make only one point. There are those who have asked why make this simple improvement to what is regarded as legislation in need of broader examination, as the Government recognised in publishing their White Paper in April this year. Why not wait? My answer is that we cannot wait. It may be many years before reform reaches the statute book and it may be many years before the change is enacted. It seems to me that the prevention of the death of one young person in the intervening years makes it worthwhile. It may save many more. I commend the Bill to the House.
Moved, That the Bill be now read a second time.—(Baroness Thornton.)
3.4 p.m.
The Earl of Listowel: My Lords, I rise to offer the warmest welcome to this long-overdue and important Bill, introduced so eloquently and thoroughly by the noble Baroness, Lady Thornton.
I was saddened to read of the tragic early death of the 14 year-old, David Knowles, which, as the noble Baroness pointed out, acted as the spur for this legislation. I hope that I may express my sympathy to his family for their loss. It is a privilege to join other noble Lords today in seeking to make it less likely that David's story will be repeated.

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Young people need to be protected from potentially destructive temptations until they are of sufficient maturity to judge for themselves and have the strength of will to resist such temptations, if they so choose. They should not be exposed to pornography on the lower shelves of newsagents' racks, as sometimes they are. They should not have easy access to tobacco; nor should they be seduced into alcoholic intoxication by alcopops. All those who prey on the vulnerability of young people deserve our deepest contempt. Those who are simply neglectful need to be made aware of their responsibilities, as the Bill proposes.
The All-Party Parliamentary Group on Children was recently given a presentation by the National Children's Bureau on child-friendly environments. I welcome the Bill as a means of reassuring parents. Just as street calming, sleeping policemen can make the streets safer for children, so can a credible limit to the access to alcohol of minors.
I welcome the Bill because it clarifies for children and young people what they can and cannot do. All those who work with children recognise the importance of setting clear boundaries. I am sure that the noble Baroness, Lady Thornton, in her experience as a teacher, would find that to be true, too. Teachers and youth workers know that if they are to be respected, the rules agreed and understood by them and their charges need to be applied consistently. To be inconsistent is to court contempt and to confuse the young person.
Furthermore, young people will test the boundaries set for them by adults. They will see just how far they can go. Children of 14 will buy alcohol to show their ability to tweak the nose of adults. The current lax arrangement incites under-age drinking. As I am sure your Lordships are aware, young people are often curious about alcohol and wish to experiment.
When I learned to ride a bicycle, I began with stabilising wheels or the hand of my father on my saddle. I hope that the Bill will be viewed as a means of protecting young people from initiation into alcohol in an uncontrolled and unsupported way and that it may lead us to think of means within the family at home or among elder peers whom we trust to aid our young people to learn to manage drink.
I have but one concern. Can the Minister assure the House that new Section 169C will be enforced only in rare and unusual circumstances? The section makes it an offence for a person under the age of 18 to buy or attempt to buy intoxicating liquor. I am concerned in particular that this section may be used to harass young rough sleepers. As I understand it, the principle adopted by several police forces is that it is the licensee and not the young person who is prosecuted. I hope that the Minister will support that principle and view new Section 169C as being enforced only in the rarest circumstances. I regret that I was unable to give the Minister more than a short warning of this question. If he would prefer to consider it further and write to me, that would be perfectly acceptable.
3.9 p.m.
Lord Addington: My Lords, the Bill seems to be necessary to enforce the law as it currently stands. The law should take into account modern purchasing habits and the construction of the retail trade. It is unfortunate that it has taken so long. Everyone in Parliament must share the blame for that, because any one of us here or at the other end of the corridor could have initiated this Bill.
If the Bill makes the law workable and blocks a gap, we should all endorse it and ensure that it has a speedy passage through Parliament. I congratulate the noble Baroness, Lady Thornton, on introducing the Bill and wish it well.
3.10 p.m.
Lord Bach: My Lords, I welcome this opportunity to praise the decision of the honourable Member for Pudsey to introduce the Bill in another place and I congratulate my noble friend Lady Thornton on acting as its sponsor in this House. Her keen interest in the welfare and safety of children and young people is well known. No one better could have been found to move the Second Reading of the Bill. The Government share her deep concern about the unlawful sale of alcohol to young people and I am happy to express our strong support for the Bill.
The White Paper Time for Reform, published on 10th April this year, showed that we consider the protection of children to be one of the primary purposes of licensing law. So the importance of this simple Bill should not be underestimated.
As the Government are poised to embark on major reforms of the licensing arrangements, some noble Lords may have wondered why we need the Bill. There is one very good reason: during our debate we have heard vividly about the ongoing damage that alcohol is doing to many young lives. The major reforms that we proposed in April's White Paper will lead eventually to a very substantial Bill that will deal with some controversial issues and will necessarily involve a significant commitment of parliamentary time. We cannot say today when it will be possible to introduce the necessary Bill reforming licensing law, and if it eventually receives Royal Assent any new arrangements will require a period of transition before the full benefits are realised. It may therefore he some years before significant changes are evident. That is why we agree with my noble friend about the need for this Bill now.
The Bill gives us an opportunity to take prompt action and to change the existing law now. That will mean that those who are evading prosecution for selling to minors and irresponsibly buying alcohol on behalf of children can be dealt with more effectively without the delay that I mentioned. During the perhaps two to three years before we see major reform, many children and their families could suffer unnecessarily.
Few would disagree that our licensing laws are out of date and dreadfully old-fashioned. The Bill focuses on the use of the term "servant". Parliament at one

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time believed that "master and servant" would cover all employees responsible for selling alcohol and provide sufficient protection for the general public and children. Modern case law has stood Parliament's intention on its head. The words have now come to be used only as a means of evading prosecution. We can and should put that right.
My noble friend set out movingly the circumstances that led to the tragic death of the young boy, David Knowles. That story highlighted a problem of prosecuting offenders employed by national chains of off licences. There are other problems with the outdated wording. The term "servant" in the existing law does not include an agent acting on behalf of the licensee who is not his employee. The wife or husband of a licence holder working in the off licence in an unpaid capacity may be immune from prosecution for selling to under-age children. Similarly, a brother or another family member serving in a shop could escape prosecution.
In 1996, the conviction of the husband of a licensee for selling to a 14-year-old girl was quashed in the Divisional Court because there was no evidence of a master-servant relationship. The House will know that many high street off-licences are run by families, and it would be quite wrong if a licensee could evade prosecution by putting the responsibility in his or her spouse's hands. So this is a further loophole the Bill will address.
Since its introduction in another place, the Bill has also acquired some extra teeth. It is a sad indictment of our society that there are adults who are willing to act as the agents of youngsters to enable them to get hold of alcohol. The new offence—which has been referred to as "proxy purchase"—will therefore be another measure to help us fight the problems of under-age drinking.
The reforms proposed by the Bill are both sensible and fair. Noble Lords will see that under the Bill both the offence of selling to minors and that of buying on behalf of minors are offences that cannot be committed if the adults involved have been genuinely—I stress genuinely—duped about a child's age. The extent to which the adults had behaved reasonably in seeking to establish the child's age, and the extent to which they have been genuinely deceived, rather than just turning a blind eye, are matters on which the courts should rule.
Indeed, in resolving these issues either the defence or the prosecution might very well want to produce in court the child involved. I understand that that has become a common means of either establishing a defence or establishing the case for the prosecution where age is the key issue before the court under licensing law. It is usually the heart of the matter where a not guilty plea has been entered. Production of the child has the great merit of allowing the court to rely solidly on common sense. If, after seeing the child, the court is of the opinion that the defendant must have turned a blind eye to the child's age, it may convict.
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Noble Lords may wish to know that the Magistrates' Association has confirmed to the Government that magistrates are well used to deciding matters of this kind and very much welcome the proposed legislation. We are therefore confident that the available defences in the Bill will work effectively in the interests of justice.
Indeed, the Government have a very simple message for retailers and the staff of off-licences who might have any concerns about these new offences and how the defences might operate: if you are in any doubt about the age of the person standing in your shop, do not sell alcohol to him. In the vast majority of cases, it really should be as simple as that.
I was grateful also for the contribution of the noble Earl, Lord Listowel, who also has a reputation in this House for care and concern for young people and children. He asked me a question and I am grateful to him for giving me some notice of it. We strongly support the discretion which the police use, and always use, in cases of this kind. I cannot give him the guarantee or the promise he seeks. But we feel that the police are likely to use their discretion in the same way once the Bill becomes law. That must remain a matter for the police. It is not for the Government to say how the police exercise their discretion in any case. I hope that that answer goes some way towards satisfying the noble Earl.
The Government have no hesitation in giving their full backing to the Bill and we commend it to the House.
3.17 p.m.
Viscount Bridgeman: My Lords, before the Minister sits down, and with the leave of the House because I am not supposed to speak after the Minister, I wish to add that this Bill has the total support of these Benches. I thank the noble Baroness, Lady Thornton, for her explicit and informative exposition of the Bill.
We hope that the passing of this Bill will encourage the alcopops manufacturers to show greater responsibility. The recent decision to modify the labelling of alcopops is an extremely encouraging sign. I am most grateful to your Lordships for permitting this intervention.
3.18 p.m.
Baroness Thornton: My Lords, in answering this debate, it remains only for me to thank all those who have helped me in the task of preparing to bring it to your Lordships' House. I am grateful indeed for the excellent briefing from Mr Truswell, to the House authorities and the Minister for guidance to a relative greenhorn who is doing something for the first time.
I am grateful also for the support of the noble Earl, Lord Listowel, and the noble Lord, Lord Addington. It is not the first time that we have supported each other in measures concerning children and young

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people. I also thank the Minister for his kind words of support and explanation. I look forward to seeing the measure on the statute book in due course. I commend the Bill to the House.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Code of Practice on Industrial Action Ballots and Notice to Employers
3.19 p.m.
The Minister for Science, Department of Trade and Industry (Lord Sainsbury of Turville)The Minister for Science, Department of Trade and Industry (Lord Sainsbury of Turville) rose to move, That the draft code of practice laid before the House on 26th June be approved.
The noble Lord said: My Lords, the purpose of this draft code is to revise the present statutory code of practice with the same title issued in 1995. The revisions are mainly to reflect the changes made by the Employment Relations Act 1999 to the legislation dealing with industrial action ballots by trade unions. We have also taken the opportunity to shorten and clarify the code's provisions. At the same time we have tried to keep material which has been found useful in the past by unions, employers, balloting organisations and those who advise them. Subject to parliamentary approval for the draft code, we intend to bring it and the 1999 Act changes into effect from Monday 18th September.
The code would be issued under the powers in the 1992 Act which allow for the Secretary of State to,
"issue Codes of Practice containing such practical guidance as he thinks tit for the purpose,

(a) of promoting good industrial relations, or

(b) of promoting what appear to him to be desirable practices in relation to the conduct by trade unions of ballots and elections".

Like the present code, it would impose no legal obligations and failure to observe it would not by itself render anyone liable to proceedings but its provisions could be taken into account in court proceedings relating to the statutory requirements.
Taken together, the revised code and the amended legislation are designed to provide a framework to promote the orderly conduct of industrial action ballots and good industrial relations practices in the cases, which fortunately are now relatively rare, when industrial action is being contemplated.
This is designed to fulfil the Government's commitment to simplify the law in this area by making it easier for trade unions and their members to understand their rights and responsibilities. We believe that that should reduce the risk of legal disputes over technicalities, which are in no one's real interests, while preserving the key elements of the present legislation.
It may help your Lordships if I briefly outline the legislative context in which the code would operate. Generally speaking, encouraging people to break contracts can give rise to a liability to pay damages to parties who suffer loss as a result of the breach.
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The organisation of industrial action by trade unions is a longstanding exception from this general principle, so long as certain conditions are met allowing the union to benefit from what are often called the "statutory immunities".
The unions have to meet various conditions if they are to enjoy these immunities, including, for instance, a requirement that the industrial action concerns a trade dispute between workers and their employer. But the conditions that particularly concern us today are those that prevent these immunities applying to industrial action organised by trade unions unless the action is sanctioned by a majority vote in a properly conducted ballot and certain information is provided to the employers of the union members to be balloted or, subsequently, encouraged to take industrial action.
The law places a number of duties on unions in this area, and your Lordships may be relieved to hear that I do not propose to go through those in great detail today. But I shall briefly summarise the changes made by the 1999 Act which give rise to the need for the revised code that we are debating today.
The 1999 Act does away with the requirement for unions in some circumstances to give employers the names of their members whom they intend to ballot or call on to take industrial action. We said in the Fairness at Work White Paper that we did not believe it right to force unions to disclose their members' names, possibly against those members' wishes. Unions will be required to give employers information to enable them to make plans and bring information to the attention of the workers concerned but the 1999 Act makes it clear that in future unions will no longer be under any obligation to include their members' names as part of this information.
The other changes in the 1999 Act, first, make it easier to suspend or postpone industrial action by agreement between the union and employer, for example, to allow talks to proceed. Secondly, they rationalise the requirements on unions to provide employers in multi-employer ballots with information on ballot results and samples of voting papers to be sent to their workers.
Thirdly, the changes seek to rationalise the restrictions on whom a union can call on to take action after a ballot. A union can currently call on members to take action who were not balloted because they were not members at the time. That is being extended to cover workers who were members of the union at the time of the ballot but were not balloted because it was not then reasonable for the union to believe they would be called upon to take industrial action. That would arise, for example, where a member was unexpectedly transferred into the group of workers that the union intended to call upon to take action.
Fourthly, they seek to simplify the existing, very complicated, requirements governing when a union can hold a single ballot of members in different workplaces for the purposes of deciding whether or

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not they favour industrial action; fifthly, to end uncertainty by defining overtime and call-out bans as "action short of a strike" for the purposes of the law on balloting (reversing a recent High Court judgment which decided that overtime bans were strike action) and removing continuing uncertainty over the status of call-out bans.
Sixthly, the changes amend the statutory "health warning" which must appear on ballot papers to reflect the new unfair dismissal rights introduced elsewhere in the Act, which entered force on 24th April. That reflects an amendment tabled by the noble Baroness, Lady Miller, in the House of Lords during the passage of the Employment Relations Bill. Seventhly, they extend the existing limited flexibility designed to facilitate the balloting of merchant seamen. And, finally, they give the courts greater scope to disregard small, accidental failures in the organisation of ballots which would not affect the result. Those changes were made following a series of detailed consultations.
In the Fairness at Work White Paper, we asked for views on the ways in which the existing legal framework could be simplified or clarified. We received a large number of suggestions in response which we studied carefully, rejecting those which would have undermined an essential protection or feature of the existing law or which were unworkable or gave rise to problems in legal interpretation. The remainder were incorporated in the 1999 Act.
We then revised the code of practice to reflect those changes, and in April this year we published a consultation document containing a draft code. Officials held a public meeting during the consultation process which gave an opportunity for interested parties to raise concerns and seek clarification. By the end of the consultation period we had received 34 responses from a variety of quarters including the CBI, TUC, trade unions, employers' organisations and employers, lawyers and employment relations specialists. A list of respondents has been placed in the Libraries.
Over half the responses, from all sides, welcomed the Government's aim of simplifying the 1995 code and most of those said that they believed the consultation draft had done so. A number of suggestions for further improvements were made. Inevitably, we were not able to accommodate all of them; some, for instance, were contradictory and some directed at the underlying law rather than the code itself. But the draft before the House today takes account of many of the comments we received and is, I believe, the better for it.
As well as updating the content to reflect the 1999 Act changes which I have already outlined, the draft code makes clearer the distinction between exhortation, restatement of the law and guidance—for example, on reasonableness tests—which would be of use to those conducting industrial action ballots and can be taken into account by the courts. It cuts down on repetitive and explanatory material which might have been useful when the provisions were new but has
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become less so in the light of experience; and it replaces or removes some unnecessarily prescriptive wording. The draft is some 15 per cent shorter than the current code and, in my view, is clearer and easier to understand.
We are living in a time of relative industrial harmony. The number of days lost through industrial action is near its lowest level since records began in 1891. We are pursuing a partnership agenda aimed at keeping it that way. The changes which we are proposing to this code, and the changes made by the 1999 Act, will further contribute to that process by maintaining the fundamental principles of the current law while removing unnecessary burdens and red tape, clarifying unions' obligations and narrowing the scope for legal disputes to arise. I beg to move.
Moved, That the draft code of practice laid before the House on 26th June be approved.—(Lord Sainsbury of Turville.)
Lord Northbrook: My Lords, the Government have produced a code of practice on industrial action ballots and notice to employers of over 18 pages. So far as I can tell, it conforms to the requirements of Schedule 3 of the Employment Relations Act 1999.
I hope that the comprehensive nature of this code of practice will ensure that disputes, if they arise, are dealt with in an orderly manner and that walk-outs and intimidation are prevented. Despite the fact that small accidental failures to comply with the code are to be ignored, I also hope that the code will not prove to be the basis for complicated litigation. I can only say that we on these Benches trust that these proposals will effectively serve the purpose for which they are intended.
Lord Clarke of Hampstead: My Lords, I welcome the guidelines now before us. As a trade union representative with over 40 years' experience until my retirement, ranging from a local representative of Post Office workers to a national officer, I should like to express my appreciation for this draft code of practice.
When the law was introduced by the previous government much concern was voiced, some of which has now been put to one side by virtue of this revision. Indeed, anything that reduces the number of words and saves the cost of lawyers crawling all over ballot papers and the law as it reflects industrial relations, is to be welcomed. However, more than anything else, this is clearer; it is simplified; and it is something to be welcomed by those who are practitioners of industrial relations. This revision is clearly in line with the Government's thinking on the concept of industrial partnerships. I welcome this code of practice and give it my whole-hearted blessing.
Lord Sainsbury of Turville: My Lords, I am sure that these proposals will serve the purpose that they seek to achieve. We have taken enormous trouble to get right both the legislation and this code. We consulted interested parties from beginning to end to ensure that

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we took on hoard their valid concerns. I believe that that was time well spent. I commend the draft to the House.
On Question, Motion agreed to.

National Minimum Wage Regulations 1999 (Amendment) Regulations 2000
3.31 p.m.
Lord Sainsbury of Turville Lord Sainsbury of Turville rose to move, That the draft regulations laid before the House on 26th June be approved [23rd Report from the Joint Committee].
The noble Lord said: My Lords, I am pleased to present to your Lordships a number of significant changes to the National Minimum Wage Regulations which give effect to the National Minimum Wage Act.
As the House knows, we asked the independent Low Pay Commission to monitor the effect of the introduction of the national minimum wage during its first few months in operation and to report its findings to us. The commission undertook a comprehensive consultation exercise. Its report, along with the Government's responses to it, was published on 15th February.
Your Lordships will remember from our consideration of the regulations in May that the minimum wage policy has benefited well over 1.5 million workers and their families throughout the United Kingdom without any detrimental effect on the economy, prices or employment. In fact, we have seen more people than ever before in employment since the minimum wage took effect. Jobs are being created, especially in the service sector where the national minimum wage has most impact.
The House will be aware that both of the Low Pay Commission's main reports made a number of recommendations. In our response to the first report, published in 1998, we introduced the youth rate at a lower rate than that recommended by the commission but said that we would increase the rate to the recommended rate of £3.20 per hour in June 2000. We debated this increase earlier and the new hourly rate took effect on 1st June. Today we are debating the increase to the main minimum wage rate which applies to workers aged 22 or over, as well as the recommendations of the second report and the changes to the regulations that are needed to implement them.
In its first report the commission recommended that the main minimum wage should be introduced at a level of £3.60 per hour on 1st April 1999 and advised that it should be raised to £3.70 in June 2000. The Government introduced the minimum wage at the £3.60 rate but decided it would be prudent to wait for the commission's second report to be published to judge what impact the new legislation was having before making a decision on the £3.70 rate.
When we published the second report on 15th February, we announced that, in view of its positive findings and the fact that the economy was working well, we would increase the main rate of the minimum wage from £3.60 to £3.70 per hour on 1st October 2000—an increase of 2.8 per cent.
We have delayed the timing of the increase to allow businesses sufficient time to prepare for the change. The Government's continued awareness of the needs of business has been a key reason why the minimum wage was brought in so smoothly and successfully, and we intend to retain that approach.
The announcement of the increase to the national minimum wage rate was made in February and received wide coverage in the media, Since then, we have included information about the increase in the Inland Revenue's April newsletter which was sent to each of the 1.2 million tax-registered employers, and we have also written to workers' and employers' representative bodies. We shall provide more information about that increase in the Inland Revenue's September newsletter. The publicity campaign in May and June on the youth rate also mentioned the increase in the main rate. A substantial publicity campaign, including coverage on television, will be launched in September or October to ensure that workers are aware of their rights and that employers know their obligations under the law.
The Low Pay Commission's second report was extremely positive and found that the national minimum wage was introduced successfully. The commission's recommendations covered publicity, enforcement, guidance and some clarification of regulations in certain specific areas, which I shall come to in a moment.
The Government accepted all 16 of the Low Pay Commission's operational recommendations and suggestions, subject to the usual detailed consideration of practicality and resources. However, we were not entirely convinced by the argument for changing the treatment of 21 year-olds so that they received the main adult rate for the minimum wage. We have asked the commission to continue to look at this and return to it in its next report.
Today we are debating the increase in the main rate of the national minimum wage and several other regulatory changes recommended in the Low Pay Commission's report. There were three specific recommendations: to extend the modern apprenticeship one-year exemption to cover national traineeships; to extend the sandwich student exemption beyond undergraduates to cover postgraduates who are required to take a work placement as part of their course; and to tidy tip the regulations on travel time and stand-by time to ensure they meet the policy objectives.
I shall briefly explain to the House how the regulations will work. Regulation 3 fulfils the Government's commitment to raise the main rate of the minimum wage from £3.60 to £3.70 an hour. We now believe that it is right to go ahead with this increase.
Regulation 4 deals with people in training and education. The first part addresses an anomaly identified by the Low Pay Commission. It concerns young people in England and Wales engaged on national traineeships schemes and people in Scotland and Northern Ireland on equivalent schemes. As the commission noted in its report, such training is, in essence, the same as the modern apprenticeship except that it leads to a National Vocational Qualification at level 2 rather than level 3. Modern apprentices under 26 years of age are already exempt from the minimum wage in their first year, and the difference in treatment came about only because the national traineeships were too new for the commission to consider for its first report. We are also applying the exemption to people on similar schemes in Scotland and Northern Ireland; such schemes are known as SkillSeekers and JobSkills respectively.
The regulatory impact assessment estimates that some 20,000 trainees will be directly affected by this change. Some trainees who currently receive the minimum wage will no longer be entitled to it under this legislation. However, they will continue to be entitled to whatever pay is provided by their contracts of employment, which should be changed only with the agreement of both parties.
The second part of Regulation 4 applies an exemption for sandwich students. The current regulations provide that undergraduate students and trainee teachers do not have to be paid the national minimum wage for any work they do when placed with an employer as part of their course. The commission recommended extending the exemption to postgraduates; otherwise their prospects of finding suitable placements would be reduced. There is some evidence to suggest that employers have opted to provide placements to undergraduates rather than postgraduates. This change in the regulations is likely to affect only a few hundred people.
The commission also recommended that, if feasible, we should provide a similar exemption for students who work in this country but study at universities in the rest of Europe. We have now considered the practicalities of trying to do this but our lawyers have advised that such an exemption would be highly impractical and virtually impossible to define and verify. The exemption is therefore limited to students studying in the United Kingdom.
These provisions underscore the Government's commitment to training and education. We want to see the right training targeted at the right people and to correct any small anomalies that are caused by the way in which the regulations were first drafted.
Regulations 6, 7 and 9 concern a number of more detailed and esoteric issues that have come to the attention of the Low Pay Commission and the Government since the introduction of the national minimum wage last year. Regulation 6 is important because it concerns the way in which the rules operate as regards travel time for those required to travel between assignments during the working day. Some
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employers felt that the existing provisions were ambiguous, so we are making the position absolutely clear: such travel time counts as work and the national minimum wage rates must, therefore, be paid.
Another amendment improves the way that the rules operate for those on so-called zero-hours contracts—such workers are permitted to go home while on call, but may instead choose to go elsewhere—and for those who are allowed to sleep at work while on call. The next change concerns a minor difficulty with the application of the regulations to those workers who are responsible for submitting their own timesheets. There are also one or two purely technical regulations designed to ensure that the amendments are placed correctly into the law.
Finally, I wish to inform the House of a technical difficulty with these amending regulations which has come to our attention since they were debated in Committee in the other place. The point is a particularly complex one which results from a potential mismatch between the wide definition of "worker" used in the national minimum wage and the reference to a certain kind of trainee, known as a "national trainee", in these new regulations. The way that the new regulation is drafted means that there could be a situation where a young trainee who is not employed by the employer with whom he is training may nevertheless be held to be an agency worker as defined in the primary legislation and therefore entitled to the national minimum for any work done in the course of training.
I should stress that such a reading of the law would rest on an obscure legal technicality and be counter to a common-sense understanding of what the law intends. The point does not impinge on the main intention of these regulations and there is therefore no reason to prevent my asking the House to support them in their present form. But, of course, it is my duty to make your Lordships aware of the point. I can give noble Lords a commitment that the Government will be returning with a slightly amended version of the relevant regulation as soon as possible in the next Parliament to clarify the situation once and for all.
In the meantime, it will help if I clarify for the House the purpose of Section 34 of the National Minimum Wage Act 1998, which entitles agency workers to the minimum wage. The reason we needed the section was because some people who are supplied by agencies to do work for others sometimes do so under peculiar and often deliberately obscure arrangements such that they would not have counted as workers under the standard definition in Section 54 of the Act. Section 34 was never intended to apply to those who are supplied by a training organisation to business for the purpose of receiving training rather than performing work and should not be taken to do so.
The Government are keen to build on the success of the first year of the minimum wage. We shall ensure that it continues to provide adequate protection for lower-paid workers in future years. As your Lordships will know, the Government have asked the Low Pay Commission to prepare a third report by July 2001. We

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are asking the commission to continue to monitor and evaluate the impact of the minimum wage and to make further recommendations on the rate. In particular, we have asked it to consider movements in earnings this time round. That does not mean that we are proposing an automatic link between earnings and the minimum wage. We have always been against any formulaic approach to setting the level of the minimum wage.
We believe that to use earnings or the cost-of-living indices alone would be to take far too narrow a perspective. Before arriving at its conclusions, the commission will also take account of such factors as competitiveness, employment and the impact on particular groups of people, such as young workers and women, and on different sectors of the economy, especially small firms.
We expect that any increase in the minimum wage that the Low Pay Commission recommends can be put into effect in the autumn of 2001. It will take several years to assess the full impact of the national minimum wage. In the meantime, we have every intention of proceeding with caution. Despite its very successful introduction, we need to remember that the minimum wage is still in its infancy. It is a powerful instrument of policy that affects millions of people's jobs and livelihoods. Caution and the avoidance of risk are therefore crucial. We must not put at risk the jobs of those whom we are seeking to protect, nor place unnecessary burdens on business.
The national minimum wage, which many of us believe should have been introduced many years ago, was introduced in the United Kingdom only just in time for the 21st century. We shall not put at risk its continued success and general acceptance by employers and employees alike by abandoning the careful approach that has been tried and tested.
These amendments make sound, sensible and necessary improvements to the law. I commend the regulations to the House.
Moved, That the draft regulations laid before the House on 26th June be approved [23rd Report from tile Joint Committee].—(Lord Sainsbury of Turville.)
3.45 p.m.
Lord Northbrook: My Lords, we are discussing the National Minimum Wage Regulations 1999 (Amendment) Regulations 2000. I am grateful to the Minister for pointing out to me yesterday that a problem has arisen with the regulations since they were passed in the other place. On these Benches we find it extraordinary that regulations are passed that subsequently are found to be faulty. That reflects a government problem to which I shall return later.
Of course we shall be approving these draft regulations. But I do not believe that we should just "nod them through" without comment. The Explanatory Note tells us that their object is to increase the national minimum wage by 10p an hour. Regulation 3 devotes 18 words to doing that. The note also tells us that the regulations are to make,
"a number of other amendments to the National Minimum Wage Regulations 1999".
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Those amendments take up no fewer than four pages. They include such gems as:
"Subject to paragraph (1A), time work includes time when a worker is available at or near a place of work for the purpose of doing time work and is required to be available for such work except where—

(a) the worker's home is at or near the place of work; and

(b) the time is time the worker is entitled to spend at home".

That regulation relates to the situation where employees are not working all the time but are required to be on standby in case of sudden rushes of work; for example, lunchtime in a fast food takeaway restaurant.
These amendments are typical of the legislative state the Government find themselves in. Bills and regulations are introduced in the other place and reach us in a totally different state. While they are here, further swathes of amendments, sometimes whole new schedules, are brought in. That has been the experience of my noble friend Lady Miller on the four major Bills with which she has dealt in the past three years. The Government are now making amendments to the regulations which they brought in only last year to apply the National Minimum Wage Act. That is another example of the legislation on the hoof about which we on these Benches repeatedly have to complain. "Legislate in haste, amend at leisure".
But there is more than that. The Act is complicated enough on its own, but then there are the regulations and now the amended regulations. It is all very well for large companies or the unions with plenty of professional advisers. But what of the employees trying to discover their rights and small employers, who are the ones most affected, trying to discover their duties? There are at least three pieces of primary and secondary legislation to plough through. On these Benches, we hope that the burden of regulation will be eased in the future.
Lord Razzall: My Lords, perhaps I may follow the remarks made by the other Opposition party in this House by changing the tone. Not only do I welcome these regulations but, contrary to the noble Lord who has spoken before me, I also welcome the approach the Government have adopted here. When the minimum wage legislation was first introduced, I understood that a continuing consultation process would take place. That was done because no one knew what would be the exact impact of the minimum wage legislation. Indeed, from these Benches we argued quite strongly a number of points to which the Government responded by saying, "Let us give that task to the Low Pay Commission. It will look at the implications of the minimum wage and bring forward recommendations. We shall then implement those by way of regulation".
I did not agree with the Government on many of the detailed points of the legislation, but I recognise the approach. Indeed, I think that we should welcome the fact that, after consultation and the publication of a report from the Low Pay Commission, the Government feel that the regulations need to be altered. I hope that the process will continue. If we are to establish an appropriate dialogue between business

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and government, the way not to go about it is for the Government to legislate in these august halls and then to tell business that it will have to put up with that legislation. The Government should not say, "We do not care about the implications here. You can put up with it. We shall not change anything".
As I said earlier, although I agree with the fundamental principles underlying the introduction of a minimum wage, I disagreed with one or two detailed points as regards the minimum wage legislation. However, I did not disagree with the Government taking recommendations from the Low Pay Commission, holding extensive consultations and then bringing in amendments by way of regulation to amend regulations and then to amend further regulations. I hope that the process will continue.
Last year I listened for many days to the comments of the Conservative Opposition as regards the national minimum wage. Several speakers spoke of how the temples of Sodom and Gomorrah would descend on industry in this country if a minimum wage was introduced. However, we have seen absolutely no evidence whatever that the introduction of the minimum wage has had even the remotest adverse effect on employment. However, the noble Lord did not see fit to congratulate the Government in any way or to admit that he was wrong and that the Government and the Liberal Democrats were right in their view that the introduction of the national minimum wage would have no effect on employment levels in this country. That has been very adequately demonstrated. I look forward to the next occasion on which the Minister brings forward regulations. I hope that the Conservative Party will then make that apology, which is long overdue.
Having made those comments by way of introduction, perhaps I may ask the Minister a question as regards a comment he made towards the end of his remarks about the next stage. It will not have gone unnoticed that the press has been seriously contemplating the contents of the Labour Party manifesto for the next election. Word has it that, first, a commitment will be made to remove the distinction between the minimum wage for young people and that for everyone else. Secondly, in return for the financial backing of the trades union movement for the Labour Party during the next election, a significant commitment will be made in the election manifesto to a substantial uprating of the minimum wage. In the light of the Minister's remarks on behalf of the Government, can he confirm his statement that no change will be made to the rates of the minimum wage until the Low Pay Commission reports in September 2001? If, as anticipated, the election takes place during the spring of 2001, nowhere in the Government manifesto will we see a commitment to changing the fundamental structure of the minimum wage until the Low Pay Commission reports in the following September of that year.
Lord Sainsbury of Turville: My Lords, perhaps I may say, first, in relation to the regulations, that the
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technical changes we have made have sprung largely from the recommendations of the Low Pay Commission. I think that it would be extremely unwise to introduce such a piece of legislation and then pay no attention to any problems which may arise which, in this area as in many other areas of employment law, reflect the complexity of industrial life in this country.
The issue of the zero hours contract is a real and important problem. The fact that situations can arise where employers put people in a back-room and say, "We shall not pay you, except for those brief moments when you come out and flip the hamburgers during the lunch hour", is not entirely in keeping with the spirit of the legislation.
As regards the noble Lord's point about the future election manifesto, I am sure that he does not expect me, even on a Friday afternoon, to make such a simple mistake as to suggest what the content will be. The Low Pay Commission is starting to gather evidence. It is due to report by July 2001. When the report is produced, we shall give it due attention. I commend the regulations to the House.
On Question, Motion agreed to.

Education (School Government) (Terms of Reference) (England) Regulations 2000
3.55 p.m.
The Minister of State, Department for Education and Employment (Baroness Blackstone)The Minister of State, Department for Education and Employment (Baroness Blackstone) rose to move, That the draft regulations laid before the House on 22nd June be approved [23rd Report front the Joint Committee].
The noble Baroness said: My Lords, the regulations arise from provisions set out in Section 38 of the School Standards and Framework Act 1998. They were laid before the House on 22nd June and have been considered by the Joint Committee on Statutory Instruments.
The regulations set out the terms of reference for governing bodies of maintained schools and define the respective roles and responsibilities of governing bodies and head teachers. They also confer two specific functions on governing bodies and head teachers.
We have consulted all the relevant bodies and taken many of their views into account: 88 per cent of respondents, covering all the interest groups, were in favour of the regulations.
The noble Lord, Lord Haskins, in his recent Better Regulation Task Force report on red tape affecting head teachers specifically welcomed the Government's intention to legislate to define roles and responsibilities more clearly. We believe the regulations achieve that.
We greatly appreciate the time, energy and dedication that volunteer governors bring to their work in schools across the country. We do not underestimate the workload involved, nor the time that they spend on governor duties. But some

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governing bodies are taking on too much because they are getting unnecessarily involved in day-to-day management. Their primary role is to,
"promote high standards of achievement in the school".
The regulations make more explicit the distinction between governance and management—which is the proper role of head teachers—helping to avoid damaging disputes.
The terms of reference contained in the regulations set out as operating principles for governing bodies the Nolan principles of honesty, objectivity and integrity in public life. They require governing bodies to be open about their decisions and actions (other than those which should properly be kept confidential) and to act in the best interests of the school. They also require governing bodies to be accountable for the decisions they take by explaining their decisions and actions.
The regulations require governing bodies to exercise a largely strategic role in the running of the school. The head is responsible for the internal organisation, management and control of the school and for implementing the strategic framework established by the governing body. Of course, there is a grey area in between.
Much will depend upon the experience of the head and the extent to which governors are prepared to delegate those functions not reserved exclusively for them. As volunteers it makes sense for them to delegate where possible. We do not want to be too prescriptive. The regulations will allow room for governing bodies and heads to decide what suits them best, taking account of the size or type of school or the personalities or strengths of individuals. However, this will be within a nationally agreed framework to protect both parties from unreasonable encroachment into each other's legitimate areas of responsibility. Where governing bodies delegate a function to the head, they may also issue reasonable directions with which the head must comply. Guidance on the regulations (copies of which have been placed in the Library), particularly on the use of delegation, will help governing bodies to organise their workload more effectively and minimise the scope for disputes.
Of course, not all of the statutory duties of governing bodies are strategic; some are operational or executive, for example sitting on pupil discipline committees to consider pupil exclusions. My noble friend Lord Haskins has recommended that governing bodies should not carry these responsibilities, but that is the subject of another debate. These regulations build on existing responsibilities and describe the essential functions involved in acting strategically: setting aims and objectives, policies and targets, and monitoring and evaluating progress. They are not new requirements but describe what governors are already doing in schools. Governing bodies should consider the head teacher's professional advice and act as a "critical friend" through supporting the head and offering constructive criticism and advice.
We expect governing bodies to ask searching questions, not merely to rubber stamp what is brought before them. The regulations do not deal with the role
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of the head in its entirety but build on the relevant aspects of it as defined in the conditions of employment of head teachers. The head is responsible for formulating aims, objectives, policies and targets. These are not new responsibilities. The head teacher as the "lead professional" should have a view as to the general direction of the school and how to get there. However, on all these issues the regulations make clear that the final decision rests with the corporate governing body.
The regulations allocate two specific responsibilities to governing bodies and head teachers: to agree and implement the school's curriculum policy and the performance management policy. The requirement to have a policy for the secular curriculum merely formalises what is happening in schools already. Schools will not be involved in extra work as a result. The performance management policy is intended to work alongside the appraisal regulations laid on 20th June. The department has produced a national model performance management policy. We do not, therefore, expect this to be a burdensome task for either the governing body or the head teacher. There is a requirement for all staff at the school to be consulted, and the policy must be in place by 31st December.
We want to improve the quality of education for all pupils by helping school teachers to carry out their duties more effectively and take advantage of opportunities for career and professional development. The results of the consultation confirm that the regulations and the related guidance have been widely welcomed. A better understanding of each other's roles and responsibilities should enable governing bodies and head teachers to work well together in an atmosphere of mutual respect to ensure that they get on with the essential task of raising standards in schools. I beg to move.
Moved, That the draft regulations laid before the House on 22nd June be approved [23rd Report from the Joint Committee].—(Baroness Blackstone.)
Lord Astor of Hever: My Lords, I thank the Minister for explaining the draft regulations, which are concerned with school government. I reply on behalf of my noble friend Lady Blatch who is unable to be present this afternoon. My noble friend welcomes the purpose of the regulations, which is to clarify the distinctive roles of the head teacher and school governors. However, she remains concerned about the bureaucratic burden on governors and head teachers. At a time when the Government have pledged to cut the level of bureaucracy, the regulations add yet more through a requirement to produce a strategic framework, curriculum policy and performance management policy, all to a format which is centrally directed. Every additional burden which makes demands of time on head teachers means less time available to the daily and considerable task of running the school.
In Standing Committee in another place on 5th July the Minister said (at col. 14):
"We are conscious of the demands on schools, particularly head teachers; that is why we are committed to less red tape and to allowing heads more freedom to focus on essentials".

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That is not how it is seen at school level; nor is it the view of the noble Lord, Lord Haskins, chairman of the Government's Better Regulation Task Force.
The conclusion of the task force report records that,
"There are widespread and deeply-held views that increased red tape is acting as a distraction from the drive to raise standards … Over-elaborate processes are being used to achieve straightforward objectives, leading to unnecessary duplication, and confusing lines of accountability".
From the production of the regulations, it is obvious that the Government have not heeded the warning of the noble Lord, Lord Haskins. Clarification of roles is one thing, but additional tasks for governors and head teachers are not helpful. Have the Government costed the time needed to fulfil the additional duties and training required for governors and head teachers? Will schools receive any additional funding for these new tasks?
A point raised in another place, on which the Minister promised a written reply, is also of concern. At Third Reading of the Learning and Skills Bill, the Minister claimed that city academies would be subject to compliance with LEA policies on admissions, exclusions and acceptance of excluded pupils. Yet in debate on this regulation, the Minister said that city academies would not be subject to maintained sector governing body rules and will not, therefore, be subject to these regulations. Both statements cannot be correct. Will the Minister please clarify the point?
My noble friend Lady Blatch wishes me to register her disappointment that despite the best efforts of both the Printed Paper Office and the Library of the House she has been unable, in advance of this debate, to obtain a copy of the guidance for school government to which the Minister, Jacqui Smith, referred. To reduce the burden on schools it would be helpful if the Minister were able to be specific rather than to talk vaguely in percentages about the actual bureaucratic tasks and/or duties which are to be abolished.
While my noble friend remains concerned about the additional demands on schools, nevertheless she welcomes the clarification of roles and responsibilities for head teachers and governors. Therefore, on her behalf, I do not intend to oppose the regulations.
Baroness Sharp of Guildford: My Lords, from these Benches we, too, welcome the clear differentiations made in the regulation between the strategic role of governors and the hands-on management role of head teachers.
I have two questions and two areas of concern. First, do these regulations replace existing regulations setting out terms of reference for governors? Secondly, I assume that the concept of strategic planning incorporates the budget-setting role of governors and the monitoring of the budget which is currently among their responsibilities.
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My first concern has been expressed by the comments of the noble Baroness, Lady Blatch, conveyed by the noble Lord, Lord Astor: namely, the extra bureaucracy involved in schools. The Minister said that there should be no increase in the amount of bureaucracy involved because those are current responsibilities. Appraisal is a new responsibility which has emerged this year. It involves considerable amounts of time on the part of the head teacher and, in larger schools, of deputy head teachers and members of the governing board, in particular the chair of governors.
My experience as a governor is that much of the drawing up of strategic plans devolves to the head teacher. The responsibility for drawing up those plans and bringing them before the appropriate meetings of the governing bodies rests upon the head teacher and those who work in the office with him or her. The noble Lord, Lord Haskins, commented on the bureaucracy faced by head teachers, and I found it amazing and surprising that he should be so complacent about these extra responsibilities.
We very much agree with the concept involved in strategic planning, the process of target setting, monitoring and evaluation, but such activities are not insignificant. Those involved in governing bodies know just how much paperwork is involved in addition to the responsibility of fulfilling these tasks. I hope that the Government will ensure that enough administrative back-up is available to heads so that they can fulfil these functions. Such work is significant, detracts from other activities, and we all know that these days head teachers are extremely hard pressed.
I should also like to cast some doubt on the whole issue of performance-related pay. We entirely support division of function, the concept of strategic planning, the drawing up of activities and their monitoring, but we have always had reservations about the concept of performance-related pay. We believe that teaching is, in essence, a team activity, and that it is invidious for heads and deputies to have to differentiate between colleagues. It would have been preferable to use the resources available in this initiative to provide a general increase in pay, especially for the more senior teachers, and to improve average pupil/teacher ratios. But that, as the Minister knows, is a comment that we have made before. However, neither of my concerns will prevent us from agreeing with the regulations.
Baroness Blackstone: My Lords, I am grateful to the noble Lord, Lord Astor and the noble Baroness, Lady Sharp, for giving these regulations a general welcome. They both commented on bureaucracy. We do not want governors to become involved in too much detail. The regulations focus on what heads and governors need to do. Far from imposing additional burdens on them, the regulations and guidance will make clearer what is required of them.
The guidance encourages governing bodies to delegate where appropriate, having taken account of issues such as the head's experience, and whether or not he or she is being effectively supported. We consulted both heads and chairs of governors through

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small group meetings, and we have tried to address some of their concerns. For example, in the guidance we have taken on board their express wishes for references to working in partnership and governing body accountability. I understand that the guidance has been placed in the Library, but if that is not so, I shall ensure that it is placed there immediately.
Apart from the performance management policy, these regulations do not place an obligation on governing bodies to prepare more policies or set more targets or objectives than they already have. Regulation 4 does not name a single new aim, objective, policy or target. The strategic framework is no more than the overarching plan. That will, of course, cover the general issues of budgeting for which governors are responsible.
The guidance explains that the plan will generally be the school development plan, improvement plan or post-Ofsted action plan which schools already have. These regulations will not start a new paper chase in our schools. They simply provide a framework within which governing bodies should operate. I hope that that explanation provides reassurance to both Front Benches.
The noble Baroness, Lady Sharp, mentioned appraisal and performance-related pay. Appraisal is not the subject of these regulations; it is dealt with in separate regulations which have been laid. I am aware of the Liberal Democrat Party's reservations about performance-related pay, but the Government are convinced that it is right to reward good teaching. We want to give every teacher who reaches the threshold the opportunity of being appraised in order to benefit from the substantial increase—up to £2,000—which those who come through the appraisal and cross the threshold will receive. Furthermore, the regulations do not replace existing regulations. No existing regulations deal with terms of reference of governors and heads under the School Standards and Framework Act.
The noble Lord asked whether extra money would be available for the tasks which the regulations expect schools and governors to perform. We are providing additional funding for performance management via the Standards Fund. I hope that that answer is helpful.
The noble Lord also asked about city academies. Perhaps the most helpful course would be for me to send a copy of the letter which my honourable friend the Parliamentary Under-Secretary for School Standards sent to the Liberal Democrat spokesman in another place. I hope that that will be helpful. I shall set out clearly answers to the questions he raised.
We have not carried out particular costings of what is implied in the regulations, but the Government do not believe that a great deal of extra expenditure will be involved. Good heads and good governors are already involved in everything that is set out in the regulations. The Government are committed to reducing red tape and have already taken substantial steps to do so. I have mentioned that on other occasions in the House.
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Finally, I thank both Opposition spokesmen for their general welcome of the regulations. I hope that I have dealt adequately with their questions and I commend the regulations to the House.
On Question, Motion agreed to.

Pollution Prevention and Control (England and Wales) Regulations 2000
4.17 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty)The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty) rose to move, That the draft regulations laid before the House on 15th June be approved [22nd Report from the Joint Committee].
The noble Lord said: My Lords, in moving the regulations, I draw attention to the fact that they flow from a European IPPC directive agreed in 1996. Our domestic legislation, the Environment Act 1990, was used as a model for that directive. Under the domestic legislation, pollution from industry is regulated under the integrated pollution prevention and control (IPPC) regime for larger and more polluting processes, or the local air pollution control (LAPC) regime which governs other processes which generate emissions to air.
The new integrated pollution prevention and control regime will bring with it a number of improvements. One very important improvement is the inclusion of energy efficiency among the factors which the regulators must consider. These energy measures will not only bring environmental benefits but could result in financial relief to industry itself.
These regulations are the product of extensive consultations which my department has carried out over the past four years. The consultation process has involved regulators, industry, trade associations, environmental interests and the public. In fact, this review of the existing legislation has been a good example of effective dialogue between government, industry and other stakeholders. In the light of the contributions that we have received, we have developed the regulations in a way which we believe strikes a fair balance between environment protection and the concerns of the various sectors of industry which are covered.
I also draw attention to the fact that these are affirmative resolution regulations. Indeed, we are, committed to ensuring that any changes made to provisions previously contained in primary legislation will continue to be the subject of affirmative resolution, thus giving this House and those in another place the proper degree of parliamentary control over changes to the legislative programme.
In that context, the Government's clear preference is to implement European directives through domestic primary legislation in this field. Clearly, the alternative would have been to implement the directive directly, using the powers under the European Communities Act 1972. However, that would have left us with a complicated and burdensome arrangement consisting

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of three different pollution control regimes and would have given the courts and, indeed, industry considerable difficulty in interpreting the law. The CBI, for example, was not in favour of that approach; neither was most of industry.
My department has estimated that approximately 7,000 installations in England and Wales will be subject to the directive. New installations will be brought in with immediate effect. However, existing installations must be brought into the new regime by the directive deadline of 30th October 2007. To ensure an easy transition from one regime to another, we have devised a phasing timetable which will commence early next year. The timetable has in part been determined by the availability of the European Guidance on Best Available Techniques as well as reflecting existing permitting cycles under the current system.
The timetable has also reflected other concerns. The Government recognise the important role that farming, in particular pig and poultry farming, plays in rural communities and understand the potential seriousness of the economic crisis in which the industry now finds itself. Therefore, we have decided to defer implementation of IPPC for the pig and poultry sectors until 2007, which, under the directive, is the last possible moment.
We also supported and encouraged the discussions that took place between the Environment Agency and the farming industry in developing general binding rules. Those rules will reduce the regulatory effort required by the agency and consequently, therefore, the fees paid by farmers while at the same time maintaining a high level of environmental protection.
There is one exception to the clear timetable set out in Schedule 3 to the regulations for commencement of IPPC. The entry date for bringing in landfills to IPPC is at this stage notional. The Government are currently considering how to implement the landfill directive, which covers both integrated pollution and control sites and others, and will shortly issue a consultation paper. It is expected that landfill sites will be phased in from 2002 although, until the nature of the phasing is determined, we have entered a nominal date on the timetable.
The timing of bringing this set of regulations before the House also needs to be noted. The deadline for transposing the directive into domestic legislation was October last year. At present, therefore, we are behind a number of European member states which have either transposed or implemented the directive. This is a potentially embarrassing situation for us, especially in view of the fact that the directive was in no small part based on our own current pollution control regime.
We believe that this regulatory framework is by its very nature adaptable and will allow the sharing of experience both here and across Europe. The process of regulation promoted development and improvements, both in technologies and techniques,
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which in turn will bring wider and greater benefits to the environment, to the various sectors of industry and to local people.
Finally, I can confirm that in my view the provisions of the draft regulations are compatible with the European Convention on Human Rights. I commend them to the House.
Moved, That the draft regulations etc.—(Lord Whitby.)
Lord Dixon-Smith: My Lords, it is an indication of the problems that the Government face with regard to pressure on their legislative programme that we take regulations of such significance at this hour on a Friday afternoon.
The Delegated Powers and Deregulation Committee produced a scathing report on the 1999 Act, because it consisted of one very large Henry VIII clause. About 30 clauses of the 1990 Act were repealed, to be replaced by these regulations, which are, in effect, a significant item of primary legislation. In other circumstances I would have preferred a different way of dealing with them. Their significance is such that it is unsatisfactory that our only choices are to approve them or not. However, that is the situation that we are in.
The Government's excuse for passing the Bill in that form was that we were under time pressure. The same excuse is used for the regulations. I sympathise with the Minister to the extent that action is being initiated against the United Kingdom on the other side of the water in Brussels because we have not taken the appropriate action under the 1996 directive. It is not in this country's interests to be taken to court in that way, so I shall not oppose the regulations, but I have a number of questions.
I have received briefings from the CBI and the NFU. The Minister said that there had been wide, detailed and satisfactory consultation. The CBI gives a different impression, saying that there has been an underlying theme of a lack of detailed information. None of us would say that that was satisfactory and I am sure that it is not what the Government intended.
The CBI has raised a number of questions. The EC Directive 96/61 refers to "industrial-scale" activities. In transposing that directive into regulation, the Government have introduced the term "commercial" in place of "industrial-scale". The CBI is concerned about that, because it could exclude some of those who cause pollution, such as research establishments, perhaps run by a university or a charitable foundation.
The Minister might not have time to answer that, but I hope that he will be able to answer my next question. As he said, there is a link between the IPPC regulations and the climate change levy. As I understand it, only companies regulated under the IPPC Part A can negotiate for agreements that comprise binding energy efficiency targets under the climate change levy. Companies will want certainty that, in meeting the negotiated requirements, they will be deemed to satisfy the CO2 and energy efficiency

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requirements under the other side of the legislation. It is not unreasonable to expect both sides of the equation to balance.
There is a problem with site restoration under these regulations. Again, the CBI is concerned because it can cause a major problem for industry after the process is completed and the disposal of the site becomes an issue. There is a question as to the fitness of the site, the problems of site surveys and so on.
There is also a very serious question from the CBI as to what constitutes a "site". The relationship between an installation and a site appears to be vague. The CBI would have preferred to have "installation" and "site" separated by using the word "establishment" which is used under the control of major accident hazard regulations. Under those regulations, an establishment is defined as,
"the whole area within which one or more installations are located, under the control of the same operator or, where multi-operator or operationally interdependent installations exist, the relevant group of operators, and for this purpose, two or more areas under the control of the same operator or group of operators and separated only by a road, railway or inland waterway shall be treated as one whole area".
Having accepted that as an establishment, the CBI would have preferred an "installation site" to be that area of land used primarily for the operation of a particular installation or a separately permitted installation thereon because there are a number of industrial sites with a number of separate permitted installations. So there is a problem there.
That illustrates the sort of difficulties which the CBI still have with these regulations. It also has a problem on the question of commercial confidentiality. Under Clause 31, the regulator decides what is commercially confidential and has to give notice that that determination is taking place within a specified time. If that notice is not given, the applicant must assume that the information is deemed not to be commercially confidential and the applicant has 21 days from the 28 clays that were originally allowed for the ruling in order to appeal that the information he has given should be commercially confidential.
Since we are now dealing with what I would call a voluntary declaration by the regulator, there is a problem for the applicant. The situation becomes more difficult because when the regulator believes the information is commercially confidential but should be on the register, he is obliged to contact the applicant to enable him to provide more details to inform the decision.
The CBI feels that in that instance, the notice should always be given by the regulator stating whether information in relation to an application is either commercially confidential or not. So the applicant always has a reply from the regulator and does not have to guess what is happening by whether or not he has received a response. That would make matters rather more straightforward for both the regulator and for applicants. I ask the Minister to give consideration to that matter.
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Commercial confidentiality leads me neatly to the agricultural sector. For the first time various intensive agricultural operations are included. The agricultural industry is in a politically sensitive situation in relation to intensive installations and intensive farming. In considering some of the wilder things that, unfortunately, have happened over the past few years in the context of fur farming and, more recently, experimental badger trapping in parts of the West Country, one realises that if information giving map and grid references and titles to intensive farm operations is available on a website, as indeed is required by the legislation, that could have a difficult effect on the security of otherwise perfectly reputable agricultural operations. A few people may take a rather unfortunate, not to say an extremely unfortunate, view of that process.
The definition of an agricultural installation for the purposes of the regulations seems to depend upon numbers of animals. We are talking of units of more than 40,000 laying hens or other birds and more than 400 farrowing sows and 700 fattening pigs. I raise this point because the number of animals on a farm, in an installation where those animals are kept indoors, is one thing, but increasingly nowadays, where the environment is right and the soil types are suitable, pigs are kept out of doors, particularly farrowing pigs. It would not be wise perhaps to do that with fattening pigs. I have visited farms where I have seen small huts consisting of curved sheets of corrugated iron, which make perfectly adequate shelters for pigs, stretching as far as the horizon and there is no installation on the farm at all. I find the use of numbers as a definition rather strange.
There is a problem, which arises in two ways, with the competitive position of the United Kingdom in regard to these regulations. We know that, unfortunately, the agricultural industry at present is in deep trouble, hut we have a much higher proportion of our pig and poultry industries in this country in large units that will be subject to these regulations. In the United Kingdom 7.4 per cent of our pig holdings would come within this category. The figure for Denmark is 5.1 per cent and for the Netherlands it is 5.4 per cent. That may not seem significant, but in Denmark I understand that the cost of a licence will be £1,000 and in the Netherlands it will be nothing. Here we are talking about the cost being or the order of £3,000.
Can the Minister give me an assurance on this matter? It would be interesting to know how the charges are arrived at. I understand that the Environment Agency has an obligation to cover only its costs. I have no difficulty with that as a proposition, except that an obligation to cover only costs gives no incentive to business efficiency. The Minister and I have debated matters of best value in regard to local government oil a number of occasions. In fact, if all a local authority had to do was balance its budget and have no consideration for value for money, that would not be a happy situation. The Environment Agency is apparently to be permitted to operate with nobody monitoring costs or making sure that the agricultural industry receives value for money. The industry simply has to meet the costs presented to it. That is not good enough.

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I believe I have raised sufficient questions on the regulations to show that we have real concern over their content. In another situation I would have wanted to table reasoned amendments. This shows the weakness of the regulatory procedure. We can only approve or disapprove. I believe circumstances will dictate that the Minister will need to return to this House before very long with amendments to these regulations. However, I shall not be opposing them. It would be neither appropriate nor in this country's interests for me to do so. But on a purely personal level, I cannot approve of them in detail.
Baroness Miller of Chilthorne Domer: My Lords, we on these Benches welcome these regulations in that they will give an added impetus to cleaning up our environment and to the new technology as an investment in that operation. We also welcome the inclusion of energy efficiency.
I read the regulations in conjunction with the new consultation draft document from the Environmental Agency, Creating an Environmental Vision, which I found to be extremely interesting. It helped to give one a feel as to how the agency may carry out its duties with regard to these regulations.
I shall not take up the time of the House repeating the questions raised by the noble Lord, Lord Dixon-Smith, in relation to the agricultural industry. But I should like to ask one specific question about the difference between new or substantially changed units in that regard. The regulations appear to refer simply to "new" units. What will happen to a producer who adds on some additional houses—for instance, for extra egg-laying hens? At what point will the regulations kick in? At what stage will it be considered that he has substantially changed his facility? I should welcome clarification on that point.
Another area on which I should like clarification is in relation to what is meant by the change in permits covered in Part II, paragraph 5, on planning. The link between planning, development control and the implementation of the regulations appears to be much closer. It is already difficult for councillors to balance the need for sites for producers and industry, which will be covered by the regulations, and the volume of local objections that arise from such applications. If there is to be a closer link and more applications have to go through the development control process—a perfectly worthwhile process when we are trying to clean up the environment—guidance for councillors would be extremely useful. I should be most grateful if the Minister could cover that point in his response. In conclusion, I believe these to be useful regulations and, subject to my questions being covered satisfactorily, I give them a wholehearted welcome.
4.45 p.m.
The Earl of Longford: My Lords, may I ask whoever is in charge of the business of the House whether there is any hope of the debate on the disabled being dealt with shortly? We were told that it would start between
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three and four o'clock. It is now a quarter to five. Many people have to make their way home to fairly remote parts of England. I repeat: is there any hope of the debate coming on shortly?
Baroness Farrington of Ribbleton: My Lords, we have three further orders to deal with before it will be possible to begin the Unstarred Question.
Baroness Byford: My Lords, like my noble friend. I am quite concerned as regards the implications of the regulations and their effect on the farming fraternity. Therefore, my remarks will focus on that particular sector. We welcome the implementation delay date and thank the noble Lord for it. As he well remembers, I tabled several Questions as to why the regulations were being introduced early. When part of his reply referred to the "convenience of regulators", I nearly hit the roof. So I am truly grateful that the Minister has decided to put off the implementation until the year 2007.
However, I believe I am right in saying that the regulations obviously apply "straightaway" to any installations established since October 1999, so those concerned will have to pay for this now. Moreover, I understand that birdcage sizes will have to be altered before 2007. But if, as a result, substantial changes need to be made to that farming practice, will those concerned fall into the category of having to pay the IPPC charges at that stage, or will they be allowed to wait until 2007? I should be grateful to receive an answer on that point and I hope that the Minister understands my logic.
Although we are anxious to see pollution and its prevention controlled, as clearly explained by my noble friend, there are immense pressures on the farming industry at present. Indeed, of all sectors, probably the pigs and poultry sectors are the ones facing enormous problems. According to the NFU, the Government promised earlier this year at the farming summit to avoid gold plating the legislation, its implementation and enforcement and to regulate in the least bureaucratic and burdensome way. But here we have extra burdens, extra costs and extra regulation. It is most unfortunate.
I also understand that a pledge was given at the farming summit to reduce permit charges by 50 per cent when general binding rules are in place. However, the NFU has expressed to me its concern that the charges are excessive and higher than any others imposed on agriculture for environmental purposes. Perhaps the Minister can also comment on that issue. Moreover, any changes that add to farming costs, such as this permit, will obviously not be recoverable through the market-place and are therefore a straight tax on those producers of pigs and poultry. Here, again—and for the second time today—I should declare an interest. We have a family farm on which we produce pigs. However, we are not big enough to fall into this catchment.
At present, competitiveness is everything to the pig and poultry producers in the country. I know that we are somewhat behind in introducing this directive,

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but perhaps the Minister can tell us how many of the member states will have implemented it at this stage and how many remain outstanding.
As my noble friend said, we already know that the full cost recovery of the implementation for Denmark is only £1,000—there is no charge in Holland—whereas ours, as the Minister knows, is much higher. I should be grateful to hear the Minister's comment. Perhaps he can also tell us whether any other countries are taking a similar view. For example, do we know what the situation is in other member state countries? Are there any interim charges in place?
My noble friend made another extremely important point with regard to the free availability of information on addresses and the possible availability of national grid references. This year there has been increasing pressure from pressure groups—I may not have expressed that well, but I think that noble Lords know what I mean!—on mink producers. Recent GM trials have been trashed. There are problems with the ongoing badger trials. Recently I had great difficulty finding a perfectly kept and well organised poultry establishment. The owners of such establishments sensibly try to make it difficult for people to discover where they are situated.
As regards poultry, a 40,000 bird layer unit typically produces some 12.2 million eggs a year. Average costs of production per dozen are 45p and the average returns per dozen (on the wholesale market) are approximately 54p. Even to reduce the charges of the permit and subsistence by half (to £6,000 and £2,768 respectively) would increase the costs per dozen by 0.86p and reduce profits made by 9.6 per cent. This is at a time when, as I say, the industry is in immense difficulty. Returns for producers supplying eggs under contract for a packer are negative, so losses would, of course, be increased.
My noble friend said earlier that we tend to have bigger pig units here than on the Continent. An 800 breeder/finisher could expect to produce 16,420 pigs per annum. Therefore an additional charge of £8,768 would increase costs by 53p per pig. For a 2,500 finishing place unit finishing 8,000 pigs, those charges would increase the cost by £1.10 per pig. In the current crisis in the industry this would add considerably to the losses those businesses are already suffering. The noble Baroness, Lady Hayman, who is the Minister responsible for agriculture, is present. I say to her that I am aware that prices in the pig industry have recovered a little but there is still a long way to go, as I am sure she accepts.
I have read the debate of the Standing Committee that took place in the other place. I have already mentioned the position of Danish and Dutch producers. When asked about other regulations, the Minister in the other place was not exactly direct in his reply. He referred to the regime in Ireland. When my honourable friend Owen Paterson pressed him further, he said that he would write to him and to other Members of the committee on the arrangements in Holland. I understand that no such letter has yet been received. I hope that the Minister will comment further on that.
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In this country we have the highest welfare standards. British farmers are proud to set such standards. However, if those high standards, and the extra burdens and costs that they incur, drive farmers out of business, we are not handling the regulations in the way that I am sure all noble Lords would wish. Our welfare regime has standards far above those of most of our neighbouring countries. A report in the Farmers Guardian last year showed that 80 per cent of Dutch pig farmers did not respect the welfare regime in Holland.
I reiterate what my noble friend Lord Dixon-Smith said earlier. It is such a shame that the Pollution Prevention and Control Act 1999 conferred huge Henry VIII powers. Normally regulations comprise a document of one or two pages. However, the regulations we are discussing comprise a book of some 83 pages. As my noble friend said, we cannot alter what is happening. We can only raise our concerns with the Minister. We can only approve or disapprove. I have expressed my particular concern for the pig and poultry sectors. I appreciate the desire for a cleaner environment, but if that pushes our producers out of business when those in other countries do not have to bear these burdens, we are going about it the wrong way.
I have spoken at this stage only about the EU regulations; obviously we operate in a global market. I look forward to the Minister's response.
Lord Whitty: My Lords, a number of points have been raised. Perhaps I may turn immediately to the last point made by the noble Baroness—which was the first point made by the noble Lord, Lord Dixon-Smith—as regards the nature of the regulations and the nature of the legislation which was passed last year. We had lengthy and interesting debates on this issue which, at the end of the day, led to a degree of understanding about the approach we were adopting under the new legislation. Since 1996 the Houses of Parliament have debated the essence of the directive some five times; and, so far as concerns outside consultation, these regulations have been the subject of no less than three rounds of consultation. Admittedly they are larger and more complex than many regulations, but, even so, that is a substantial degree of consultation with all sectors of industry, including agriculture. The regulations reflect much of the feed-back from those consultations.
Turning to answer a number of specific points, the noble Lord, Lord Dixon-Smith, asked about the reference to "commercial purposes" rather than to "industrial scale". In our view the wording of the directive was not sufficiently precise for our legal structures to ensure that operators and regulators were clear as to what was and was not regulated. Based on the size of world markets, "industrial scale" could range from 1 million tonnes a year to something very much smaller. We have therefore referred instead at the start of Chapter 4 to,
"producing in a chemical plant by chemical processing for commercial purposes substances or groups of substances".

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We believe that that indicates what we are talking about here.
The noble Lord referred to the cross-over with the climate change agreements and to those agreements that can be separately negotiated by sector. It is true that the IPPC dividing line also divides and defines those sectors which can engage in such agreements and which can count for purposes of energy efficiency requirements under these regulations. I am glad to confirm that it would be the same for those sectors.
He also asked why "site" is not defined under the regulations—or, rather, why "installations" and "sites" are not defined. It is true they are not defined, but there is guidance in the practical guide that, for the purposes of the site report, the site should include the land on which the activity takes place and any land that is integral to the installation and needed for satisfactory operation. That could include, for example, land used to store raw materials. So there exists more substantial guidance than is on the face of the regulations.
The noble Lord then went on to refer to the issue of confidentiality in two senses: one in relation to procedure and the other in relation to the designation of the names and addresses of poultry and intensive pig farms. I am not sure that I followed the noble Lord's procedural points; it may be better if I write to him to explain how the procedure operates. I appreciate his concerns in relation to a possible vulnerability to attacks from animal rights activists. However, I understand that the agency's plan to put information from its public registers onto the Internet is in its early stages. Any plans to take that forward will obviously be subject to detailed consultations with the various sectors concerned. I understand that my right honourable friend the Minister for the Environment has indicated that to the NFU and that further discussions will follow.
The noble Lord also referred to the question of what was meant by an installation and whether pigs which were outside would count in the same way as pigs which were inside, if I can put it that way. I am not sure whether the terms we are using are more intensive than extensive, but only the intensive rearing of pigs and poultry in installations will be covered, and only then when they exceed the sizes stipulated.
Therefore, rearing pigs outdoors would be excluded from the regulations, whatever the number of pigs involved. The position is slightly different with poultry because free-range poultry can be covered and therefore could in theory come under the regulations. But I doubt whether there are many free-range installations with 40,000 birds. The implications for that kind of farming are perhaps fewer than was thought.
There are concerns in the pig and poultry industry. I appreciate the views of the noble Baroness, Lady Byford, and the noble Lord, Lord Dixon-Smith, about the current economics in those industries. The Government have responded sympathetically in terms of the timescales, as the noble Baroness graciously
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pointed out. We understand those difficulties and we are trying to respond in terms of both the timing and the costs of the regime.
The noble Lord, Lord Dixon-Smith, questioned whether the nature of the charging is leading to efficiency gains. Later this year we will be conducting an overall assessment of the Environment Agency's efficiency and effectiveness. We will be looking at the charging regime in that context, as in others, which, it is to be hoped, could result in efficiency savings that could be passed on to the operators through reduced charges in the longer term. So that is being addressed in a slightly different context.
The noble Baronesses, Lady Miller of Chilthorne Domer and Lady Byford, asked whether any changes in the existing poultry installations, particularly in relation to changing welfare provisions elsewhere, would mean that they were defined as new installations. The substantial change criterion indicated in the regulations is one which may have a significant negative effect on the environment. We do not therefore expect that extending a poultry installation so as to rehouse birds to a new minimum standard to comply with those new welfare regulations would of itself create a substantial change in these terms. All other things being equal, we do not think that such a change would make that into a new installation for the purposes of the regulations.
The noble Baroness, Lady Miller, referred to the linked planning arrangements. We are currently revising Planning Policy Guidance No. 23 on pollution control. There will be further consultation on that later in the year.
The noble Baroness, Lady Byford, referred to the situation in other countries both in terms of the transposition and in terms of the charging regime. I indicated that we were behind the transposition date. Permitting is already in place in at least Ireland, The Netherlands, Sweden, France and Finland, but with slightly different mechanisms. There has also been some progress in Belgium and Portugal. But it is not yet transposed in any sense in Germany or Greece and it is only partially transposed in Italy. We are roughly half way down that table in that respect.
I have some fairly detailed information on the different charging regimes. By and large, there is a different approach in this country. The Environment Agency has to cover its costs. It is not the case, as farmers occasionally suggest to us, that there is no charging in other countries although in some countries, such as The Netherlands, there is a subsidy. But in most European countries there is some degree of charging, although, by and large, less than in this country. If the letter to which the noble Baroness referred in the exchange in the other place has not yet gone, I shall ensure with my colleagues that the noble Baroness receives a letter spelling that out in more detail.
As far as concerns the actual price, partly in the context of the summit a month or two ago to which the noble Baroness alluded, the original proposition of the pricing in this context has been substantially reduced.

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On permit application, the original agency proposals pitched it at around £12,000. That has now been reduced. Where there is a general binding rule, applications are under £3,000 and for site-specific applications, the figure is £5,900. I accept that those are still significant costs, but nevertheless they are an improvement on what the Prime Minister referred to in a statement after the meeting as a 50 per cent cut. We have therefore fulfilled that commitment.
I hope that I have been able to answer most of the questions put to me. If I have not done so, I shall write to noble Lords. As I said earlier, I also undertake to forward to the noble Baroness the letter to which I have referred. I commend the regulations to the House.
On Question, Motion agreed to.

Welfare of Farmed Animals Regulations 2000
5.5 p.m.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Baroness Hayman)The Minister of State, Ministry of Agriculture, Fisheries and Food (Baroness Hayman) rose to move, That the draft regulations laid before the House on 19th June be approved [23rd Report from the Joint Committee].
The noble Baroness said: My Lords, I beg to move that the draft regulations laid before the House on 19th June be approved. I shall speak at the same time to the draft code of recommendations for the welfare of sheep.
Our presidency of the Council in 1998 enabled us to get a key measure adopted on animal welfare in the shape of Council Directive 98/58/EC concerning the protection of animals kept for farming purposes (the so-called "general" farm animal welfare directive).
We recognised early on in drawing up implementing regulations for the directive that it would be very difficult to amend the current Welfare of Livestock Regulations 1994 without making them extremely difficult to follow. We decided that the 1994 regulations should be revoked and replaced by new ones which would combine the new EU requirements with our existing rules in a logical way. In drafting these implementing regulations we followed five basic principles.
The first is user friendliness. We are conscious that a wide variety of people will need to use these regulations. It was clear that they needed to be structured carefully. We decided to set out in Schedule 1 the requirements that apply to all animals. The schedules containing further, species-specific requirements then follow.
On our second principle, we have tried to ensure that we depart from the wording found in the present EU legislation only when it is sensible to do so. In one particular case, relating to tail docking of piglets, this has meant abandoning the wording used in the predecessor Welfare of Livestock Regulations 1994 and adopting the wording of the parent directive on the welfare of pigs.
Our third principle was to retain our national standards where they go beyond EU requirements. The noble Baroness spoke earlier of the way in which we lead the world in animal welfare. This applies, of course, to stalls and tethers bans for pigs, as well as to other areas.
Our fourth principle, which again relates to the debate we had earlier, was to keep the burden on industry to a minimum. It would appear, on the face of it, that a new raft of measures applying to all farmed animals would involve a cost to our industry, but I should make it clear that this is not the case. In fact, the measure represents good news for our own farmers because it will have the welcome effect of requiring their counterparts in some parts of the EU, who have hitherto not been subject to such welfare rules, to come up to the mark and thus to help to create a level playing field. The noble Baroness sitting opposite knows that that is of deep concern to farmers.
I move to the last of our five principles; that of ensuring that the new requirements are in line with the Action Plan for Farming announced by the Prime Minister last March. When we originally went out to consultation last June, we proposed building in three additional provisions. However, since then, Regulation 11 relating to the first principle allows for a formal notice with a specific time limit to be issued, requiring a person in charge of animals to take necessary action to resolve welfare problems. In consultation, this was welcomed on all sides as a positive measure. We are proceeding with it because it will ensure effective, but not more burdensome, enforcement.
As regards the second issue in relation to well drained lying areas, it is anomalous that the existing law requires these for animals kept indoors, but not for animals kept outdoors. We thought that we should rectify this and give legal effect to a provision which was already in our welfare codes.
We decided, on reflection, to leave out of this set of regulations the third of the extra provisions that we proposed at the outset; namely, the provision prohibiting the beak trimming of hens kept in cages. Beak trimming is not a practice which the Government in any way support. However, we shall return to the question of how to deal with it in cage systems shortly, in the forthcoming consultation and implementing exercise on Directive 99/74 on the welfare of laying hens.
I now turn briefly to the code of recommendations for the welfare of sheep. Our present sheep welfare code was drawn up in 1990. Since then, there have been many changes in the industry, and the Farm Animal Welfare Council has produced a report on the welfare of sheep. It is therefore time for the code to be updated.
The new sheep code that is before the House gives farmers useful advice as to how they can go about ensuring that their animals' ethological needs are met, in accordance with the guidance principle that underlies the directive. Unlike the existing sheep code, the revised code will apply in England only. Similar codes are being produced in Scotland, Wales and Northern Ireland.
The code contains detailed advice on important matters such as the prevention of disease, construction of buildings, and the provision of food, water and bedding. We hope that it will not be a burden, but a positive help to the industry in relation to some of its current concerns. For example, if the advice in the code is followed, it will help reduce the incidence of sheep scab.
On that basis, as the code is the first of a series to be updated in this way and will be of benefit to sheep farmers, I commend it to the House.
Moved, That the draft regulations laid before the House on 19th June be approved [23rd Report from the Joint Committee].—(Baroness Hayman.)
Baroness Byford: My Lords, I thank the Minister for putting forward the regulations. In general, we welcome them. She and I—indeed, I seem to have been talking about animal welfare standards nearly all day—have reflected our desire for high animal welfare standards in this country. I am sure the Minister appreciates that I have no wish to drive the standards down. We are right to have high standards.
However, there remains a "but". We raise animals to sell them, and we must do so in a competitive market. I share the Minister's appreciation that the regulations will benefit our farmers within the EU, because other EU farmers will have to meet the standards that are set in some of the regulations. But there is another "but". We compete also with countries outside the EU, and we must be wary of that. We compete within a global market.
Basically, I welcome the regulations. We are grateful for the recognition given by Elliot Morley in Standing Committee in another place. He said:
"If we introduce new, higher standards, we must give thought to how that will affect our farmers compared with European farmers".—[Official Report, Commons, Standing Committee, 12/7/00; col. 4.]
I am glad that that is recognised.
To follow on from that logic, we welcome, too, the establishment of the farm tractor as a logo. It does not mean that the produce marked with the logo is British, but it sets British standards. That helps the consumer. At the end of the day, the high animal welfare standards that we set are fine; but we raise animals for consumers to buy. One of the problems that we have discussed in this House in recent months has related to the way in which we try to make sure that the consumer knows what he or she is buying. So if we require that our farmers raise their animals to a higher standard, that premium should be obvious for people to see and should add value to the product on offer. I still have slight reservations on that matter.
The noble Baroness referred to the docking of pigs' tails and the practice of beak-tipping. I accept that we are to return to those matters at a later stage.
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As in the case of the IPPC, perhaps I may put the same questions to the noble Baroness. Do other EU countries implement these directives at the same time as the UK? Currently, how many have done it and how many have not?
The Minister said that the costs were negative. However, the debate in another place indicates otherwise. While I accept that the figure is not immense, I believe that there will be some costs. I should be grateful for clarity on that matter. Later in the debate in the other place her honourable friend Mr Morley said the UK should compete not only on high standards, and ensure that it did not drop to the lowest common denominator—I appreciate that—but on quality, which includes welfare, production methods and other various inputs. We agree. We are anxious that any further legislation that is introduced looks at this matter not only from the European point of view, as in the case of these regulations, but also from the wider perspective. We trade globally, not simply within Europe. With those comments, I thank the Minister for introducing these regulations.
Baroness Miller of Chilthorne Domer: My Lords, we on these Benches also welcome the regulations. I shall not delay the House further because I am aware that another debate is to follow. I make one point and ask one question. The link which the Conservatives make between high standards and consumers being aware of them is an important one. The noble Baroness, Lady Byford, welcomed the tractor logo. We also welcome it. However, at the moment the link is very much between larger producers and supermarkets. Often smaller producers are in a better position to pay particular attention to the welfare of their farm animals. We hope that the excellent production methods of small producers continue to be highlighted in a similar way to other initiatives, such as farmers' markets, and that this one will not be limited simply to large supermarkets which, commendably, have worked with the NFU to introduce the logo.
My question is related to paragraph 27, in particular zoo-technical treatments. As the notes make clear, the particular reference is to hormone treatment. In the light of the findings of the Scientific Committee of the EU that hormone substances used in the United States in beef production have proven carcinogenic links, does the Minister believe that at the moment sufficient scientific studies are being conducted so that paragraph 27 can be put into good effect? Given the speed at which the technology advances, are sufficient trials being conducted to enable us to be sure of our own scientific advice? Will the Minister ensure that her department receives as much advice on this issue as is available world-wide? That problem is likely to be a much harder one to tackle than the size of cages and the condition of bedding, important though those matters are.
Viscount Simon: My Lords, I thank my noble friend for her explanation of the recommendations for the

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welfare of sheep. I apologise to my noble friend for not reading the code of practice. My failure to do so makes me feel very sheepish.
Lord Williams of Elvel: My Lords, as to the code, I should like to ask a number of questions, of which I have given my noble friend notice. What is the legal status and force of the code? It is referred to as a statutory code. Can my noble friend explain exactly what that means?
Secondly, the document applies to England and Wales at present, but I understand that there will be a specific document for Wales. Can my noble friend explain when and how such a code will appear?
I speak as a landowner, on a very small scale, in Wales. Is not tail-docking prohibited on lambs by a European directive placed in legislation in this country? That is believed by upland farmers in Wales.
Lastly, do the Government expect my neighbours in Wales to read this code in detail and understand it?
Baroness Hayman: My Lords, I am grateful for the general welcome given to these regulations.
The noble Baroness, Lady Byford, is right to point out that while the regulations help us to create a more level playing field within Europe, we have to recognise the international dimension of trade. The noble Baroness will be aware that we have been working to ensure that there is greater recognition than in the past within the WTO of animal issues. We are seized of the need to take the regulations into account at an international and European level.
We consulted industry on whether the regulations would impose any new costs. These put into legislation the good practice codes that the majority of UK farmers already follow. In the responses to the consultation, no new costs were identified. That is discussed in some detail in the RIA which accompanies the new regulations. There is a copy of that document in the Library. I understand that no issues were raised about additional costs.
Implementation was due by 31st December 1999. Therefore (to mix metaphors) I feel somewhat like pot or kettle before casting stones about other countries. It is for the Commission to ensure that they are properly implemented. However, if we have further detail on stages of implementation in other countries, perhaps I may write to the noble Baroness.
Baroness Byford: My Lords, does the Minister imply that she does not have those details?
Baroness Hayman: My Lords, I do not have the details with me. Whether we have them collectively within the ministry, I am uncertain. Perhaps I may write to the noble Baroness. The implementation was in 1999. It is a Commission responsibility.
The noble Baroness, Lady Miller, raised the issue of zoo-technical treatments—for example, hormones. What is set out in the regulations reflects the policy within the directive and the state of scientific knowledge throughout the EU. Through our licensing
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procedures for veterinary medicines, we have to ensure that the advice Ministers receive about licensing is the most up-to-date. The noble Baroness is right to point out that it is a fast-moving field. We very much rely on the expertise of the members of the VPC and our own Veterinary Medicines Directorate.
My noble friend Lord Williams asked me several questions and I am grateful to him for giving me prior notice. The legal status of the welfare code is that it is a guideline which may be used in evidence in the event of a prosecution. The best analogy would be that of the Highway Code.
As I mentioned, separate codes will be brought forward in Wales, Scotland and Northern Ireland. I understand that in Wales that is in hand but the exact content and timing is a matter for the devolved administration. I was asked about the perception of a ban on the tail-docking of sheep. Directive 98/58 regulates rather than prohibits the tail docking of sheep. One of the code's advantages is that it sets out certain issues such as the minimum length.
I was also asked whether we expected sheep farmers to read the code. The simple answer is yes. I do not think that it is anything new but it replaces an existing code. The provisions entail responsibilities that need to be met. As I hope I made clear, we do not believe that the code imposes a tremendous burden. We have done everything that we can to make it helpful to farmers and to all those involved. On that basis, I commend the provisions to the House.
On Question, Motion agreed to.

Code of Recommendations for the Welfare of Sheep
Baroness Hayman: My Lords, I beg to move.
Moved, That the draft code of practice laid before the House on 19th June be approved [24th Report from the Joint Committee].—(Baroness Hayman.)
On Question, Motion agreed to.

Insider Dealing (Securities and Regulated Markets) (Amendment) Order 2000
5.28 p.m.
Lord Bach Lord Bach rose to move, That the draft order laid before the House on 22nd June be approved [23rd Report from the Joint Committee].
The noble Lord said: My Lords, the purpose of the order is to make a limited number of amendments to the list of securities markets to which insider dealing legislation applies.
Insider dealing is a serious crime which taints the integrity and efficiency of any financial market. London is indisputably a leading international financial centre, and attracts institutions from all over the globe to invest and set up their operations here.

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Being, and being seen to be a clean place in which to do business is a key part of London's success and one which we are determined to maintain.
Your Lordships will be aware that the criminal offence of insider dealing is governed by the provisions of the Criminal Justice Act 1993. These provisions enable the Treasury to specify the securities to which the criminal offence of insider dealing applies. The Insider Dealing (Securities and Regulated Markets) Order 1994 specifies those securities and was last amended four years ago. This order amends that order again to add three more markets and thereby bring the securities traded on these markets under the jurisdiction of the Criminal Justice Act for the purposes of insider dealing.
The first of these three markets is OFEX. This is an off-exchange share matching and trading facility operated by J P Jenkins Limited, a firm authorised by the Financial Services Authority. When the order was last amended, OFEX was a relatively small operation but its growth as a tertiary market in London has been significant. We judge that it is now appropriate for the securities traded on OFEX to be covered by the criminal offence of insider dealing.
I am grateful to the noble Lord, Lord Northbrook, for giving me notice of a question about whether OFEX will be covered by the civil market abuse regime under the Financial Services and Markets Act. The scope of the civil regime will be determined by the prescribed markets order. This was published for consultation in June 1999. It made clear that any market capable of meeting the recognition criteria for recognised investment exchanges is likely to be the kind of market that will be covered by the new regime. However, it also made clear that the new regime was not coterminous with recognition and so its scope can extend beyond the recognised investment exchanges. The responses to the consultation document are being considered. The question of whether the civil regime should apply to OFEX is part of the process of consideration. We will be talking to the relevant interested parties over the coming months.
The second market to be included in the order is COREDEAL. This is an over-the-counter, electronic exchange for international, debt-related securities. The market for these securities is a major source of medium to long-term funding for governments, international financial institutions, development banks and corporations. COREDEAL was recognised by the FSA in May of this year as an investment exchange.
The third market to be added is EASDAQ, the European Association of Securities Dealers Automated Quotations. This is a Brussels-based, pan-European stock market which was set up in 1996. The existing order already specifies a large number of regulated markets across the European economic area. It would therefore be inconsistent not to bring EASDAQ within the scope of the order.
Finally, we would like to remove the Securities Exchange of Iceland from the order because it refers to the same body already on the list; namely, the Iceland Stock Exchange. The duplicate inclusion was a simple error when the order was last changed in 1996.
It is important that the order is amended to include OFEX, COREDEAL and EASDAQ. By doing so, it deters would-be perpetrators who might otherwise take advantage of an unregulated market. These markets are significant in their own right as part of our financial sector and it is important that they should be covered by the insider dealing regime. I beg to move.
Moved, That the draft order laid before the House on 22nd June be approved [23rd Report from the Joint Committed].—(Lord Bach.)
Lord Northbrook: My Lords, we on these Benches approve the order. We note that, unlike the other orders before us today, it consists of only one page. I declare an interest as an investment fund manager, and on behalf of Members on these Benches I thoroughly approve of the tightening up of insider dealing as applying to the additional markets of EASDAQ, OFEX and COREDEAL. I am grateful to the Minister for replying to my question about the civil regime applying to OFEX. We are in favour of the order.
On Question, Motion agreed to.

Disabled People: Worldwide Charter
5.32 p.m.
Baroness Darcy de Knayth Baroness Darcy de Knayth rose to ask Her Majesty's Government whether they have made any response to Rehabilitation International's newly promulgated charter for disabled people world-wide.
The noble Baroness said: My Lords, last week, on 5th July, the Charter for the Third Millennium, which calls for the human rights of disabled people everywhere to be recognised and protected, was received by the Prime Minister at 10 Downing Street. It seems therefore the appropriate time to be asking whether Her Majesty's Government have made any response to the charter and to urge that they do so positively. I emphasise that it is the right time to ask the Question. We could not put it off and I greatly appreciate the tolerance of the staff and officers.
Perhaps I may sketch briefly the history of how the charter came about and then give a broad-brush description of its aims, leaving other noble Lords to fill in the finer detail of their chosen areas. I am appreciative of all those who have put their names down to speak and I look forward to hearing their contributions, especially to the Minister's reply.
I look forward to hearing the speech of the noble Lord, Lord Morris of Manchester, who in a sense could almost claim paternity of the charter. It was because of Alf Morris's achievements in the field of disability legislation—from promoting his Private Members' Bill, the Chronically Sick and Disabled Persons Act 1970 which was taken through this House

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by the noble Earl, Lord Longford, to being the world's first Minister for the Disabled—that in 1979 he was invited to open the UN General Assembly's debate, which led to the International Year of Disabled People. He chaired the World Planning Group, which drafted for Rehabilitation International the Charter for the 80s for disabled people world-wide.
Rehabilitation International (RI) is the coordinating body for disability organisations in more than 100 countries, working to improve life for people with disabilities. That earlier charter was RI's contribution to the International Year of Disabled People in 1981. Its goals were full participation and equality for disabled people everywhere. I speak about this charter as well because the two form part of a whole.
The charter had a major impact on the provision for disabled people in many countries. It was the basis for the UN Decade of the Disabled Person and influenced the drafting of the UN standard rules on disability. It provided targets for the 1980s at community, national and world-wide levels and set out how every nation could translate the charter's aims into reality.
Many people believed that it was over-ambitious; for example, the proposal for a Minister for disabled people, or the equivalent, with responsibility for developing and co-ordinating a national plan for disability prevention and rehabilitation. Yet, I am told that that now happens in most countries.
In the UK the national members of Rehab International, RADAR and Rehab UK, chaired by George Wilson, who is also the treasurer of Rehab International, have been responsible for advancing the Charter for the 80s and, equally, have played a leading part in the Charter for the Third Millennium. The Charter for the Third Millennium came about because most of the proposals of the previous charter had been achieved and there was a need to set out how future priorities would be met. Once again, Alf Morris—now the noble Lord, Lord Morris of Manchester—chaired the international group which drafted the new charter. I pay tribute to the way in which he continues to work unstintingly for disabled people world-wide.
The Charter for the Third Millennium was approved by Rehab International's governing body in September 1999 and has been presented to heads of state and of government, as well as to the UN and the Commonwealth Secretariat. Some of your Lordships were in the Crypt Chapel just before Christmas when the charter was presented to the Lord Chancellor and the Deputy Speaker. As I said at the beginning, it was presented to the Prime Minister on 5th July. It has also been presented to heads of state in countries as diverse as China, Russia and South Africa.
What does the charter say? Its goal is world-wide recognition and protection of human rights for people with disabilities. It updates the original charter, takes account of the benefits of information technology, stresses the need to prevent preventable diseases and expresses concern at the failure to treat treatable conditions. It calls on countries to show the political will to ensure programmes to prevent disability and
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provides services so that people with disabilities can live, work and support themselves and their families and play a full part in the community. It acknowledges that technology can do much to improve the lives of people with disabilities but that there is still a huge need for greater understanding and awareness. It recognises the importance of the media in informing and changing attitudes and it contains emphasis on social inclusion and the importance of rehabilitation and independent living.
I find the charter itself quite difficult because it uses rather poetic language. However, the attached draft plan of action gives a more detailed outline under eight headings, including ethical issues, childhood disability, access and technology. I hope that other noble Lords will say more about them. There are huge questions about ethics, genetics and the impact of AIDS.
Perhaps I may give one detail from Childhood Disability to demonstrate how much has been achieved and how much is still to do. This paper contrasts the achievements, for example, of the near eradication of polio, the reduction of mental impairments due to iron deficiency and of blindness due to Vitamin A deficiency. Yet international estimates are that only approximately 3 per cent of children world-wide are in school, and of those only one-third are girls. Therefore, our global disease and disability prevention strategies have intensified. International and national commitment to address the basic needs of children who are born or become physically or mentally disabled lag far behind.
I believe that we would all acknowledge that education opens up opportunities in life. Most of us would agree that inclusive education provides the best way and I am glad to see the heading, "Inclusion and Equity". Inclusion is viewed as the most powerful tool available to implement the equalisation of opportunities. Again, in this field much has been achieved but there is still much to be done.
I should like to quote from the plan of action:
"While many countries have made great strides in reducing illiteracy, opening up education opportunities for all around the world, it is still the pupils and students with disabilities who are the last to be let in the schoolroom door, and more often than that are sitting at home. Exclusion from school is the equivalent of a lifelong sentence of poverty and dependency-.
Three years ago, on a wonderful visit to India organised by the noble Baroness, Lady Flather, II visited a remarkable school on the campus of the Indian Institute of Technology in south Delhi. Equality is paramount, physically and mentally disabled children are welcome, there is no caste prejudice and all religious festivals are celebrated.
I met a 16 year-old girl sitting in her wheelchair with her legs folded on the seat. Her name was Mamta and she had been locked up in her room for years because she could not use her legs on account of polio and the neighbours thought that she was evil. Her parents were not unkind; they were just helpless because they could not take her out.
The school gave Mamta a tricycle and her brother helped to push her to school. She started in the kindergarten at 14 and she was so bright that she had caught up by 16 and was looking forward to going to college.
Last week, I was thinking of Mamta in the context of this debate. The same day, a lady came up to me in the Peers Lobby and said, "Didn't you come to my school in Delhi?" It was extraordinary, because she had come to visit the noble Baroness, Lady Flather. I learnt that Mamta is now 19, doing a university degree and going back to teach computer skills at the school.
Coming back nearer home, I welcome the fact that a Bill on special educational needs and disability rights in education is coming soon. I hope that it will facilitate and ensure successful inclusive education. We must work hard to get it right.
Many of your Lordships have spent hours—even years—discussing transport, accessible housing and access to work in this Chamber. By now I hope that we understand the problems and how to solve them, even if we have not yet wholly eliminated them. However, for most of the world, those are the problems to be faced today—or even tomorrow for those countries that have not yet considered the place of disabled people in society and need to be encouraged towards a more enlightened policy. We have to deal with huge questions of ethics and genetics.
There have been many useful initiatives and much progress since the Charter for the 80s was drafted, but even the UN standard rules are not compulsory. Time has shown that we need something with a bit more clout, underpinned by international standards and the experience of rights-based national legislation.
The Charter for the Third Millennium calls on member states to support the promulgation of a United Nations convention on the rights of people with disabilities, which it sees as vital to achieving its goals. I very much hope that the Government will give their wholehearted support to a convention and, if necessary, will argue and push for it in the United Nations so that the human rights of people with disabilities may be recognised and protected worldwide.
5.43 p.m.
Lord Morris of Manchester: My Lords, I most warmly congratulate the noble Baroness, Lady Darcy de Knayth, on her speech in opening the debate. The conventions of the House do not allow me from these Benches to call her, as a Cross-Bencher, "my noble friend". What I can say, however, is that she is indeed a long-standing friend, that her parliamentary record is one that I hold in high admiration and that it was enhanced both by the manner and the content of her speech today. I feel sure that her colleagues in all parts of your Lordships' House will think it most fitting that it was the noble Baroness who opened debate from the Cross Benches. For no specific party interest arises in
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commending a statement of consensus on international priorities for action to improve the status and well-being of disabled people worldwide.
The noble Baroness explained the origins of my interest in the debate as chairman of the world planning groups selected by Rehabilitation International—RI—to draft both this new charter and its predecessor, the Charter for the 80s. But, like my Bill on which the noble Baroness made her maiden speech 30 years ago—the Chronically Sick and Disabled Persons Bill—both documents were the product not of individual but of co-operative effort.
The world planning group selected by RI to draft the Charter for the Third Millennium had among its members many highly distinguished people from the north, south, east and west of the world. They included HE Chief Emeka Anyaoku, then Commonwealth Secretary-General; Justin Dart, who formerly chaired the US President's Committee on Employment of People with Disabilities; Deng Pufang, chairman of the China Disabled Persons' Federation; Archbishop Desmond Tutu of South Africa; Ms Jameela Al-Qasimi of the United Arab Emirates; Shri D K Manavalan of India; Anatole Ossadchikh, a Minister in the Russian Federation; Prince Ra'ad Bin Zeid of Jordan; Professor Stephen Hawking; and Sir Harry Fang of Hong Kong, a former President of RI. I am most grateful to them all and also to George Wilson, a senior officer of RI and chairman of Rehab UK, for his dedication to promoting the new charter here in the UK. The noble Baroness's and my acknowledgement of all his help will, I am sure, be endorsed by other speakers in this debate.
The new charter updates its highly acclaimed predecessor of 20 years ago, whose impact can be seen in the statute books of scores of countries and which became the basis for the UN World Programme of Action for the Decade of Disabled Persons. The Charter for the 80s was about basic rehabilitation services; full representation for disabled people on all public bodies making decisions affecting their lives; equal opportunities in education and the workplace; a basic income; and access to the built environment in a world where most countries had no disability legislation of any kind. The new charter is mainly about basic human and civil rights: those of the world's 600 million people with physical, intellectual and sensory disabilities.
Today millions of people, children and adults alike, more especially among the poorest of the world's poor, live with the effects of disabilities that were easily preventable at minimal cost. Failure to protect them was a problem not of resources but of political will and priorities. In the same way, purposeful action to reduce the handicapping effects of disability is still pitifully inadequate. Indeed in most of the world the problems of disabled living, far from being reduced, are multiplied by wholly unmerited but still lawful discrimination against disabled people.
The Charter for the Third Millennium offers new hope and a new vision for a new century: one of full empowerment and genuine social inclusion for

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disabled people across the world. Its emphasis is on value as well as cost and its plea to governments is for acts not of compassion but of enlightened self-interest and moral right. The knowledge and skills now exist to enable all countries to remove the barriers which exclude people with disabilities from the life of their communities. It is possible now for every country to open all of its institutions and systems to all of its people. Again what is too often lacking is the political will to proclaim and translate into action the policies necessary to bring this about. And the new charter makes it plain that a nation failing to respond to this challenge fails to realise its true worth.
The new charter states:
"In the 21st Century, we must insist on the same human and civil rights for people with disabilities as for everyone else".
It insists too that disabled people should have a central role in planning their own rehabilitation and support programmes and that disabled people's organisations should be empowered with the resources necessary to share responsibility in national planning for rehabilitation and independent living. It calls on:
"Every nation to develop, with the participation of disabled people's organisations, a comprehensive plan with clearly defined targets and timetables for implementing the aims set out in this Charter".
Other principal aims of a new charter are, first, to promote action in every country to create on-going, countrywide programmes to prevent risks that may lead to disability and early intervention programmes for people who become impaired; secondly, to achieve a UN convention on the rights of people with disabilities as a key strategy; and thirdly, to ensure that international development assistance programmes should require accessibility for disabled people in all infrastructure projects, including technology and communications, to vouchsafe for disabled people full inclusion in the economic and social life of their communities.
The question is posed as to why so many people now acquire preventable disabilities and the new charter's authors share the view of the UNICEF report The State of the World's Children which states:
"When so much could be done for so many and at so little cost, then one central, shameful fact becomes unavoidable: the reason that these problems are not being overcome is not because the task is too large or too difficult or too expensive. It is that the job is not being given sufficient priority because those most severely affected are almost exclusively the poorest and least politically influential people on earth".
Look, for example, at the incidence of blindness in the world today. Four out of five blind people live in the third world and four out of five of them are preventably blind. Yet as that inspired crusader against avoidable disability, the late and widely mourned Sir John Wilson, so clearly demonstrated, the cost of saving people in the third world from preventable disability has been falling as dramatically as the incidence of preventable disability in many of the poorest countries has increased.
What is so moving about working with leading representatives of disability organisations from across the world, irrespective of where they live, is their
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readiness always to prioritise the claims of the world's poorest disabled people. That was strongly reflected by members of the World Planning Group that drafted the Charter for the Third Millennium, as it has been in every statement commending the document at presentations to heads of state and of government.
The new charter has already been presented, among others, to state leaders in China, Russia, Ireland, Jordan, Greece, Lebanon and South Africa, and was received by our Prime Minister, as the noble Baroness said, at 10 Downing Street on 5th July. It has also been received with approbation by the United Nations and the Commonwealth and there is already wide backing for the charter's call for a UN convention on the rights of people with disabilities.
Chief Emeka Anyaoku said of the charter:
"I am proud to be associated with this humane document. While much has been accomplished, there is very much more still to do, not least in challenging failure to prevent preventable diseases and to treat treatable conditions.
I take pride most of all in the Charter's insistence that disabled children everywhere must now share the rights of all humanity to grow and learn, to work and create, to love and be loved".
Dr Arthur O'Reilly, the current President of RI, who spoke so movingly at the service held to celebrate the new charter in the Chapel of St. Mary Undercroft last December, states:
"Disabled people have waited too long for their rights to be fully recognised and protected: it is now time to move on to the UN Convention we are recommending".
My noble friend who will reply to this debate showed his interest and concern by attending the service held in St. Mary Undercroft last December; and I know he will respond positively to the charter's recommendations, as the Prime Minister did so memorably when it was presented to him on 5th July.
The Charter for the Third Millennium looks forward to a world where all citizens with disabilities are seen as giving as well as receiving; where their potential is understood and valued; where needs come before means; where if years cannot be added to their lives, at least life can be added to their years; where disabled people have an undoubted right to participate in the work and life of their communities; and where no disabled person has cause to feel ill at ease because of her or his disability.
That is the precious gift this charter can bequeath to the new millennium and I commend it to the House.
5.51 p.m.
Baroness Andrews: My Lords, I am delighted to be able to take part in this debate to welcome the charter for the new millennium. I am grateful to the noble Baroness, Lady Darcy de Knayth, for that opportunity. The charter represents 20 years of hard work by Rehabilitation International. It represents a lifetime of leadership by Alf Morris. We are all in his debt.
Disability is, more than ever, a key development issue. It is a hugely challenging one, as it means linking prevention and rehabilitation with empowerment and changes in attitudes. The charter for the new

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millennium is optimistic about the progress that has been made; it is also realistic about the challenges to be faced, new challenges that surround and compound the difficulties that face disabled people across the world.
Among those challenges I believe that none is greater than the failure to remove disabled people from the ranks of the poorest and the most dependent. Despite all the progress that we have made in articulating human rights, in science and in medicine, we have not solved the problem of poverty because the disabled have been left out of education and employment.
The fact is that unless we are more pro-active their children will be left out of those rights as well. For them, the fact that the international commitment to education is a fundamental right that has been enshrined in so many international charters has a hollow ring. I believe, therefore, that one of the most effective responses that our Government could possibly make to the expression of equal opportunities in the charter is to recommit itself to more pro-active policies for the education of disabled children.
To concentrate on that point, the figures given by the noble Baroness make a truly shocking story. There are 150 million disabled children of whom 3 per cent are in school, and yet, as UNICEF has made clear, 70 per cent of them could be in school. What keeps them out of school and what keeps them out of jobs is not their lack of talent, but the negative cultural and professional attitudes, inaccessible schools, inflexible curricula, untrained teachers, family poverty and the failure to provide early intervention that can help children to thrive.
Those figures also reflect other shocking facts as the noble Lord, Lord Morris, has said. Many diseases and disabilities are entirely preventable. In the decade since the adoption of the United Nations Convention on the Rights of the Child, more than 6 million children have been injured in armed conflict.
That is not to say that good things are not happening within developing countries or indeed through development assistance programmes. They are. Within the past year, for example, India has made a specific effort to include disabled children as of right in mainstream schools, and those schools which are good practitioners are leading the way and helping many other schools to follow their example.
But what shocks me about the briefing we received from Rehabilitation International is the statement that disabled children are still,
"routinely excluded from international development programmes";
even those which are focused specifically on children themselves, such as health and literacy. I believe that the international expertise and commitment represented within RI will not only focus concern on the root causes of poverty, but could also drive new inclusive education policies for children with disabilities. Our own Government, with their development policy, have already committed
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themselves to the goal of universal access to primary education as a means of reducing extreme poverty by 2015. They also recognise, however, that that cannot be done without ensuring that all schools attempt to meet special educational needs through a more inclusive approach to education. The countries which need help cannot do that without international assistance. The Government have already said that that is an area where further work is required.
I hope that this charter will galvanise the Government in finding new ways to do that and to ensure that special needs education as well as early intervention strategies become a requirement rather than an exception within every international assistance programme directed towards children and help them to support developing countries into making inclusive education part of their mainstream provision as a matter of course. Above all, I hope that the response of the Government, following the warm welcome the charter has already received from the Prime Minister, will be to take a lead in supporting in principle and practice the prospect of a United Nations convention on the rights of people with disabilities to match the other conventions in this field. For the 150 million children who are still waiting to be offered a place in school and a place in society, this charter is the beginning of practical action. No country can afford to waste the intelligence and resourcefulness of people with disabilities, least of all developing countries with little economic capacity.
Rehabilitation International has led the way. I hope its work will have the support that it fully deserves.
5.57 p.m.
Lord Rix: My Lords, appalling descriptions of institutions and conditions for disabled people are sadly commonplace around the world. They make us only too aware of the importance of charters such as Rehabilitation International's Charter for the Third Millennium which, as we have heard, was presented by the noble Lord, Lord Morris of Manchester, to the Prime Minister last week and which he and my noble friend Lady Darcy de Knayth described so well.
The charter ends by stating that, in the third millennium, it must become the goal of all nations to evolve into societies that protect the rights of people with disabilities by supporting their full empowerment and inclusion in all aspects of life. As we heard from my noble friend Lady Darcy de Knayth, in particular it calls for a United Nations convention on the rights of people with disabilities as a key strategy to achieve those goals.
Noble Lords may already be familiar with the statement made by the United Nations Human Rights Commissioner, Mrs Mary Robinson, in August 1998 when she said,
"Disabled people frequently live in deplorable conditions owing to the presence of physical and social barriers which prevent their integration into and full participation in the community. Millions of children and adults world-wide are segregated and deprived of their rights and are, in effect, living on the margins. This is unacceptable".

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I hope I will be forgiven if, as President of Mencap, I mention our work in the countries of east and central Europe, which has been growing over recent years and which may illustrate some of the problems facing us. Working in partnership with a number of different national and local organisations in those countries we have been seeking to ensure that the rights of people with a learning disability are protected, not least their rights for personal safety and growth. Those are countries seeking to move on from a situation we ourselves have long left behind.
In the week when a seminar in South Africa is focusing upon the issues related to HIV/AIDS, I am pleased to remember a small group home in Bucharest, set up by Mencap, Health Aid UK and Romanian Save the Children, where a group of children with HIV/AIDS and additional disabilities can enjoy what little time they have left before they die. It is in startling contrast to the infectious diseases hospital where the children used to live.
Moreover, the Government welcomed this week a visit by the President of the Republic of Macedonia and Mencap was able to announce its participation in a United Nations-led project in that country. The project has the full backing of Macedonia's Ministry of Labour and Social Policy and will work towards the closure of a large institution in that country, which presently houses some 460 children and adults who all live in grim conditions. I should mention that one little girl is in the institution simply because she has a squint! A journalist wrote the following description of a visit to the present institution:
"In February, when I visited the institution for the first time, the children were mixed with adults. They lay or crawled all around the halls and stairs. Wind and cold was everywhere. A large number of them were partly or completely naked. Others were 'dressed' (if that is the word to use) in straitjackets. Now the children are more or less divided from the adults and we didn't see many straitjackets".
Of course, we should not forget that institutions like this also existed in the United Kingdom and in the USA not so very long ago. What is important is that the Macedonian Government, recognising that the human rights of people with a learning disability are violated daily in the institution, are committed to create alternative community-based services for their residents. Mencap is delighted to be playing a role in that initiative, thanks to the British Ambassador in Skopje and his wife (Mark and Christina Dickinson) who drew our attention to the need for such action.
In view of what noble Lords have already heard in this short debate, and as we have adopted the UN Convention on the Rights of the Child, why should we not call for a convention on the rights of people with disabilities? This was also the conclusion of the World NGO Summit on Disability that met in Beijing in March of this year, at which the noble Lord, Lord Morris of Manchester, was present. It was attended by five leading international disability organizations— Disabled People's International, the World Blind Union, the World Federation of the Deaf, Rehabilitation International and, finally, Inclusion International. For the sake of clarification, I should tell noble Lords that the latter organisation is a truly
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international network representing the world's 60 million people with a learning disability and of which Mencap was a founder member in the 1960s.
As I said, the Beijing Declaration also calls upon nations to move forward from the UN Standard Rules on the Equalisation of Opportunity for People with Disabilities and to adopt an international convention on the rights of people with disabilities that will legally bind member countries. It was recognised in Beijing that the UN standard rules were an important landmark and have inspired legislation and programmes around the world to improve the living conditions of disabled people—but they are not legally binding. An international convention would be binding, once governments had signed it. It would also have a monitoring mechanism, although it is recognised, with regret, that this is no guarantee of total implementation, as the UN Convention on the Rights of the Child illustrates.
Despite that convention, we read in UNICEF's report, The State of the World's Children in 2000 that hundreds of millions of children throughout the world are still deprived of their rights. This is quite appalling. Rights need to be realised both for children and for people with disabilities.
We now have two very important statements, both of which call for a United Nations convention on the rights of people with disabilities—one, the Charter for the Third Millennium, and the other, the Beijing Declaration. Therefore, it was a great disappointment to learn that the European Union has blocked the adoption of such an international convention at the UN Human Rights Commission earlier in the year. My noble friend Lady Darcy de Knayth asks whether the Government,
"have made any response to Rehabilitation International's newly promulgated Charter for disabled people worldwide".
Perhaps I may in turn also ask the Government to respond positively to the need for such a new United Nations convention, without which we know only too well that the deplorable conditions in which disabled people live around the world will go on unchanged and unnoticed for yet another century. As Mrs Mary Robinson said two years ago, this is unacceptable.
6.4 p.m.
Baroness Uddin: My Lords, I welcome and support the charter. I am extremely thankful to the noble Baroness, Lady Darcy de Knayth, for bringing this matter before the House. One is, of course, always humbled by the outstanding and continuously imaginative efforts of the noble Lord, Lord Morris of Manchester, to further the agenda for and on behalf of disabled people.
A Charter for the Third Millennium is a significant aspiration to address the plight of 600 million people world-wide. The temptation to say too much is so great that on this occasion I shall have to concentrate on highlighting only a few good practices.
No one can disagree with the aim of a society or world where equal opportunity is a natural consequence of policies and legislation supporting full

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participation, inclusion and access for all people. But, sadly, not everyone is signed up to acting on those principles. That is why a positive and universal response to the charter is crucial. I look forward to a gallant and robust reply to the debate.
In Britain we have come a long way with the Disability Discrimination Act 1995; the setting up of the Disability Rights Commission and the recognition of carers of disabled children. This journey must recognise the outstanding work of many organisations such as Rehabilitation UK and Rehabilitation International and of individuals such as George Wilson, who has already been mentioned.
I always hesitate to make any reference to anything that is going on outside the House as I spend so much of the day inside it. However, Whip or no Whip, I ventured outside last week to witness the launch of the Employers Forum on Disability. I note that the Whip on the Front Bench has just taken in that fact! I was greatly encouraged by the discussion and demonstration of how far we have progressed over 20 years, both here and in the United States. Many individual and corporate experiences were shared and significant progress was made. The message was simply that we need a common-sense approach to achieving equality. Where there is a will there is a way.
The question before us is whether there is global change and how we can ensure that some of our positive advances are also experienced by our international brothers, sisters, mothers and children and, of course, partner organisations. Among the partners supporting the Charter for the Third Millennium are champions such as Archbishop Desmond Tutu and my good friend, the former Commonwealth Secretary-General, Chief Emeka Anyaoku.
As a Muslim woman I am particularly proud of the role of my fellow Muslim believers in the contribution that they have made to and the support that they have demonstrated for the charter. Two people who have put their signature on the document are distinguished people in the Muslim world. Both Prince Sultan Bin Abdulaziz Al Saud of Saudi Arabia and Prince Ra'ad of Jordan are known to be vigorous champions for the rights of disabled people in the Muslim community.
One of the most exemplary exercises in inclusion, appreciation and respect for disabled people is the way in which the Hajj—the annual Muslim pilgrimage to Mecca—is planned. Despite the fact that the hosts have to cater for millions of people from different parts of the world, as far as humanly possible attempts have been made to cater for the needs of the disabled. The fact that there are more wheelchairs and personal facilities—I did not want to mention toilets—for the disabled within the vicinity of Mecca than anywhere in the world is something to be noted.
Another interesting example from the Muslim world—I have not visited it, but I am reliably informed that this is the case—is that of the Islamic Republic of Iran which has done remarkably well in trying to ensure that equal opportunities for disabled people in
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that country are the natural consequences of enlightened policies and legislation supporting full inclusion in all aspects of society. Iran has more per capita facilities for disabled people—in terms of vocational and leisure centres and user-friendly transport—than any country in the region. It has more than 2 million officially registered disabled people, who enjoy the same human civil rights as everyone else—under the law.
But, like everything else, the problem highlighted by the charter is one based on attitude and lack of action. Needless to say, I should like to see every country, state and organisation signed up to this charter as a sign of their commitment to changing the lives of disabled people. I believe that we have got to get tough and practical about what our Government can do globally to move forward the agenda for disabled people. I respectfully suggest to the Minister that he should consider what leverage we have internationally. Will my noble friend consider discussing with DfID and the British Council that any future programmes and activities negotiated overseas should have agreed criteria which require the country concerned to sign up to the human rights of disabled people? I suppose I am suggesting that a standard procedure should be drawn up to call into account resource allocation on the basis of a country's track record of work with disabled people, as is the case with human rights and other fundamental principles.
Some of the examples that I have shared about the Muslim world do not surprise me when I consider the intolerance and militancy with which Islam combats discrimination against the disabled. I am no scholar, but research indicates that Allah tells the believers in Chapter 4 verse 61 of the Koran that,
"It is not fault in the blind
Nor in one born lame, nor
In one afflicted with illness".
The blame is upon those who would deny them their rights and dignity. For, in Islam, frowning upon the disabled is a crime that is unacceptable to God and God's messenger.
I suggest that if emphasis was placed on making the noble teaching of Islam on such matters more accessible to Muslim people in this country and worldwide, the charter would achieve phenomenal results within the Muslim communities throughout the world and bring equality and justice to millions who are now marginalised and discriminated against. I am adding my very small voice in support of the charter and the noble Baroness, Lady Darcy de Knayth.
6.12 p.m.
Viscount Simon: My Lords, I am delighted that the noble Baroness, Lady Darcy de Knayth, has introduced the debate, the subject of which is not only interesting but important for the future of disabled people world-wide. I apologise to the noble Baroness for shortening my speech due to the lateness of the hour.
One of the British members of Rehabilitation International is the Shaw Trust. I first came into contact with the Shaw Trust some years ago when my

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daughter received a brain stem injury at her first place of work after graduating from university. She was gently and greatly helped by the Shaw Trust to come to terms with her problems and to get back into the workplace. She has now been back in full-time employment for about four years.
Among the aims of RI are the prevention of disability and the rehabilitation of people with disabilities. Disabled people have the same right to life as everyone else, and the last century has demonstrated that it is possible to extend access to every available resource to certain members of the community. This must be extended more widely. Disabled people want to make a contribution to their communities but are frequently prevented from so doing by the disabling factors highlighted in this charter.
But more and more people are being added to the number of those with disabilities simply as a result of the failure to prevent certain diseases and the failure to treat treatable conditions. Immunisation and other preventative medicines are both practical and cost effective but governments throughout the world need determination to end the discrimination which can lead to disablement. When so many people have been disabled by preventable conditions, how can we justify inaction?
It is acknowledged that, in the past 25 years or so, the battle against age-old diseases such as smallpox, polio, measles, river blindness and leprosy can be won. More is needed to overcome other diseases, some of which have come back to haunt us and others which are comparatively new: TB, drug resistant strains of communicable diseases, increased tobacco-related diseases and those associated with alcohol and drugs. But until such time as the scale of the problem is acknowledged there will be insufficient will to address them. Yet the magnitude should he self-evident. The fact that 100 million people are disabled by malnutrition, for example, illustrates with immense power the fact that issues such as hunger, poverty and health cannot be addressed without also tackling the needs of disabled people.
Disabled people are organising themselves with increasing cohesion and efficiency throughout the world and Rehabilitation International is an important strand in that. This voice needs to be heard and it behoves all of us to do what we can to listen and respond. An important part of this is through community development. It would mark real progress to see disability receiving specific attention in all such transitional programmes.
6.15 p.m.
The Earl of Longford: My Lords, we are all eager to hear the Minister, whose devotion to the disabled is well known. I shall not stand between noble Lords and the Minister for more than a few minutes.
I know that the noble Baroness, Lady Darcy de Knayth, does not really enjoy my compliments. However, I cannot help repeating the one I paid her previously because it comes so much into my mind. It is a wonderful thing that after 30 years in what seems
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to be the same wheelchair—I am partially sighted but it seems to be the same wheelchair—she was chosen first in the election of the independent Peers. What a tribute to have! It is something of a tribute to the House that it should choose her as the first one. That was very fine on both sides.
I agree with the noble Baroness, Lady Uddin, in her humility in front of these heroes and heroines. I remember what a negro leader said to Abraham Lincoln after his greatest speech. He said, "Mr Lincoln, that was a sacred thing", to which Mr Lincoln replied, "I am glad you liked it". We are in the presence of people who have suffered a great deal but who have devoted their lives to this cause. That is bound to leave a permanent effect on all of us. I have no claim to speak in this matter, although the noble Lord, Lord Morris, did me the great honour of asking me to take his Bill through the House 30 years ago. I have a few more credentials than I used to have. Not many people can say that they have moved about the House recently in six different ways: first, on my own legs for many years until I was 90 or so; then with a stick; and then with a zimmer. I do not know how many noble Lords have used a zimmer. I have never had one on wheels. Next time I have a bad fall I shall get one on wheels. Next I had a wheelchair—pushing myself and then being pushed by someone else; and, finally, pushing the wheelchair itself. I found that the most satisfactory way of moving about that I have ever encountered. I have had those experiences. But they do not amount to much compared with what so many others have suffered and achieved.
I shall offer just one reflection. I have given notice of it, although the Minister may not have much time to deal with all the points raised in the debate. I was personal assistant to Sir William Beveridge—later Lord Beveridge—from 1941 to 1944. We drew up plans—I should say he drew up plans; I was his bottlewasher—for the welfare state. And very fruitful they proved. In those days we spent a good deal of time discussing the position of the old and the sick. They were different categories. Now most people recognise that they overlap. I hope that the Minister will have time—perhaps he will not have time today—to answer my question. Are we giving sufficient attention to the fact that, according to the figures that have been given to me, half the disabled are old people? The position of old people who are disabled is in a way almost more tragic than the position of a young person disabled from birth. I know that many others will speak up for them.
As an old person myself, I think that I qualify. I think that most people over 90 qualify. I hope that we shall be given an indication that the connection between old age and disability will be recognised.
6.20 p.m.
Lord Addington: My Lords, a fairly august company of the House of Lords has gathered to debate this subject. The noble Baroness, Lady Darcy de Knayth,

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leads and the rest of us follow. On occasion, not a few Ministers of various shape and colour have been led to doing what we felt would be a "good thing".
Baroness Uddin: Hear, hear!
Lord Addington: My Lords, I appreciate the acknowledgement of the noble Baroness, Lady Uddin. I should like to congratulate her on her bravery in admitting to being prepared to miss the possibility of a vote. I can only hope that it was on one of the days when the Government Benches had decided not to align themselves with us.
Baroness Uddin: My Lords, only for good causes. Lord Addington: My Lords, I accept that.
On reading the report, I have come to a principal conclusion, one that has been reinforced by the speeches that we have heard today; namely, that Members of this House should not feel too smug or be too happy for the simple reason that whatever we have done, we have done it too late and too slowly. Government Ministers of various parties have had to be pressurised in order to achieve what we wanted. We have constantly had to chase Ministers to ensure that disability issues are brought into legislation. Although things now move a little more swiftly, we still have to snap at heels to move matters along. Pressure has to be applied.
It should be remembered that we have not been such a moral and good society that it was not necessary to set up a commission. We should always remember that we have many problems of our own, many of which can be traced to a theme that recurs throughout the document; namely, that of perception. The philosophy of the normality of disability still has to be learnt. As the noble Earl, Lord Longford, has just mentioned, the onset of disability can take place at different stages of life and it is world-wide. We should keep it in mind that all of us have contact with people with disabilities. At various times, different forms of disability become more apparent.
On our own continent, we see areas of incredibly bad practice, as was pointed out by the noble Lord, Lord Rix. We need to ensure that we first put our own house in order. In a political system where the democratic element is dominant—that is, we must be responsive to our voters—it still took us an unconscionably long time to realise that people with disabilities should be brought into the political process and that we should listen to them.
As regards international efforts, I felt that any one of my colleagues who has any kind of responsibility in the party could have spoken in this debate. Virtually every form of activity has an international dimension which in turn reflects back on this issue. Overseas aid merely forms the start of the process.
International trade refers back to the issue; and not only trade with what is rather patronisingly referred to as the third or developing world. We shall see the
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introduction of forms of employment regulation which will cut across the board. When it comes to international links, whether it be through sport or cultural exchanges, we must bear the issue of disability in mind. The huge growth of the popularity of the Para-olympics has been, I felt, a little condescending. I believe that people only came to notice the event because British athletes have been able to win plenty of medals. That is a perfect example of how disability is pigeon-holed in our perceptions.
However, that is the area in which the Government can make the greatest contribution. The Government should take the lead by declaring that disability forms a part of normal life. The very fact of the word "disability"—I appreciate that it cannot be changed; language contains its own iron history and when you try to change it you will get into trouble—needs to be addressed in every sphere of life. If we do not concentrate on changing perceptions, we shall continue to hold high-minded discussions for ever. We will make only token gestures, because unless disability is brought to the centre of life, we shall get nowhere.
On the practical side, the philosophy that has driven the notion to incorporate disability into mainstream education is undoubtedly one of the most important. As regards our own society, we are about to go to considerable lengths to deal with this matter properly in a Bill that will affect our own society. However, once again, "We ain't there yet". The philosophy of introducing people with disabilities into the education system as a part of normal life so that they can progress into a more technologically advanced world and then on into the economic process will mean that they cannot be ignored.
Unless we start to put pressure on people and make sure that they recognise that disabled people are part of society, ultimately we shall not succeed. I look forward to hearing what initiatives the Government propose, either today or in the future.
6.25 p.m.
Lord Astor of Hever: My Lords, it is most unfortunate that this debate is taking place so late in the day. This is an important subject and deserves better. Let us not forget that there are, as the noble Lord, Lord Morris of Manchester, reminded us, 600 million disabled people throughout the world. I congratulate the noble Baroness, Lady Darcy de Knayth, on introducing this timely debate.
I congratulate also the noble Lord, Lord Morris of Manchester, who was invited to chair the committee of eminent people from all over the world who updated and redrafted the 1980 charter. It is a great tribute to the noble Lord, the world's first Minister for the Disabled, who was so involved with the noble Earl, Lord Longford, in this country's landmark legislation for disabled people, the Chronically Sick and Disabled Persons Act 1970. This has become a model for other parliaments across the world.
I should like to pay tribute also to Rehabilitation International. Since 1922, RI has a long history of accomplishments throughout the world in improving

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the quality of life of people with disabilities. From these Benches, I join other noble Lords in welcoming Rehabilitation International's Charter for the Third Millennium. I was interested to read that RI has researched the level of support for a UN convention on the rights of people with disabilities and found a positive level of support by member states. That is encouraging, as earlier attempts to establish a convention were backed by only a limited number of UN member states.
The barriers that disabled people face in any country are considerable but in developing countries they are much greater. One of my daughters has just returned from Cambodia, which is particularly affected by disability: 1.4 million of the 8 million population has been disabled as a result of poverty, war and human rights abuses.
It is important that we in this country realise the connections between the establishment of disability rights as an issue in this country and the promotion of disability rights world-wide. Without that promotion, the difficulties that disabled people face in the UK will only be reflected and amplified many times over in developing countries.
What steps, therefore, are the Government taking to ensure that disabled people in Britain have access to every resource, service and facility to ensure their integration into the community and their ability to be an independent member of society? Will the Government endorse the proposal in the charter that international programmes to assist economic and social development should require minimum accessibility standards to include technology and communication to ensure that people with disabilities are included in all programmes?
The charter rightly points out that in the third millennium we must accept disability as an ordinary part of the varied human condition. Everyone in life is affected by disability in one form or another—the noble Lord, Lord Addington, made the point well—whether family or friends. The charter observes that one family in four includes a disabled person or friend. Last year I broke my leg and had to spend some time in a wheelchair. That experience made me realise how much more we needed to do for the disabled.
Eventually, if we live long enough we all become disabled. That will become all the more evident in this country with its ageing society. I look forward to hearing from the Minister whether the Government will support the promulgation of a United Nations convention on the rights of people with disabilities.
6.30 p.m.
Lord Bach: My Lords, this has been an inspiring debate, and I join in congratulating the noble Baroness, Lady Darcy de Knayth, for having introduced it in such a moving and telling manner.
Since its inception in 1922 Rehabilitation International has done much to raise the profile of disability across the world. Nearly all noble Lords have referred to the Charter for the 80s, which was a notable milestone. Governments and the United
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Nations acted upon its recommendations. That heralded the UN Decade for Disabled People which was followed by the UN standard rules. As a direct result, millions of disabled people throughout the world now live richer and more fulfilling lives. My noble friend Lord Morris of Manchester was a driving force behind that charter. I congratulate him on the key role that he played in drafting RI's Charter for the Third Millennium. As my noble friend pointed out, I was privileged to attend the service in St Mary Undercroft in December of last year and the reception that followed it, which was itself a moving experience.
It is hardly surprising that this debate has been inspiring. Those in this House who speak on behalf of disabled people in Britain and throughout the world form one of the most powerful pressure groups in this Chamber. They do a wonderful job for the disabled. I am sure that I am not the first Minister to stand at the Dispatch Box shaking and nervous at the pressure that they place on government. The noble Lord, Lord Addington, described it very well. On this occasion I do not feel under huge pressure. I have not been asked a great number of questions which are impossible to answer, because in large part this debate has been a celebration of the charter which my right honourable friend the Prime Minister welcomed a few days ago. The charter calls for a world in which policy and legislation support full inclusion of disabled people in all aspects of society. This is an aim with which the Government identify. Noble Lords will be aware that we are committed to ensuring comprehensive and enforceable civil rights for disabled people.
I shall not bore the House by rehearsing the measures that we have brought forward. Noble Lords who have taken part in this debate at this unlikely hour on a Friday evening are already familiar with them. Not least is the establishment of a strong Disability Rights Commission, which I understand has applied to join Rehabilitation International. That is hardly surprising bearing in mind that its distinguished chairman, Bert Massie, a former director of RADAR which is itself a member of RI, has, like other RI colleagues, taken a keen interest in the charter.
Already the commission is beginning to tackle the huge task ahead of it. It is raising awareness of disability. It has also issued a consultation document on a revised code of practice on the duties under Part III of the DDA to consider making reasonable adjustments to make services accessible to disabled people. These duties will come into force in October 2004. This provides an authoritative point of contact for individuals who seek support and guides employers and service providers to meet their legal obligations and implement best practice in combating discrimination, inadvertent or otherwise, in the high street and the workplace. In the few minutes left to me I should like to concentrate on issues identified in the charter and plan of action, the Government's view upon them and what they have done in that regard. Some issues I shall leave out completely because there is not time. Others I shall deal with in a little more detail.

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The subject of technology was raised. The Government are determined to see that the rapid pace of technological change works to the advantage and not to the detriment of disabled people. Advances in information and communication technology have opened whole new areas of opportunity for disabled people. They have also raised, of course, the spectre of new sources of exclusion for those who cannot access the new technology as well as for those who become over-dependent on technology which is bound to change.
We have recognised that and have facilitated the work of a cross-Government group on access to information and communication technology which has already resulted in the highlighting of some of the key issues which need to be addressed to ensure that disabled people are neither excluded from nor by—it is equally possible—the remarkable advances which have been made in this field of technology.
I turn to ethics, another subject dealt with in the action plan which underlies the charter. Wide-ranging technological advances also mean that there are new ethical issues to be addressed. Last year we reviewed our advisory and regulatory framework on biotechnology. It concluded that a broader approach was needed for strategic issues. The Human Genetics Advisory Commission forms part of the new strategic framework. The role of the HGC is to consider the potential impact of developments in genetics for humans and healthcare—in particular the ethical, legal and social aspects of such developments. At present we are considering our response to the Human Genetics Advisory Commission's report published last year entitled The implications of genetic testing for employment and will announce our response in due course.
I turn to prevention. Advances in technology have also enabled us to reduce the risks that might lead to impairment. Medical and scientific advances have given us many opportunities to reduce the risk of premature death, ill health and disability. The charter rightly draws attention to the importance of immunisation programmes and other prevention strategies. The WHO has recognised the UK as one of the countries which has eliminated polio due to a wild virus. Indigenous diphtheria and neonatal tetanus no longer occur and measles and whooping cough are now rarities—thank goodness—in GPs' surgeries. Our routine immunisation programme protects children against diseases such as measles, rubella and polio which even today can kill or cause serious long-term ill health and disability, and is provided free to all. But our work to combat childhood diseases must and does continue. The latest development has been the introduction from November of last year of new vaccines to protect against meningococcal Group C infection.
The noble Lord, Lord Astor of Hever, asked questions very material to this debate. I deal with his second question first, on whether the Government endorse the proposal in the charter that international programmes to assist economic and social
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development should require minimal accessibility standards to include technology and communication. The noble Lord was good enough to give me notice of those questions. The Government are fully committed to ensuring the full participation of people with disabilities in economic and social development, including access to technology and communications. For example, where development organisations are involved in infrastructure and shelter projects efforts can be made to ensure that programmes are developed on the basis of broad-based participation taking particular steps to ensure that people with disabilities and other marginalised groups are fully included.
The noble Lord asked what steps we have taken to ensure that disabled people in Britain have access to every resource service and facility to ensure their integration into the community and their ability to be an independent member of society. We seek to ensure the integration of disabled people into our society through our commitment to civil rights. There are several examples, but I shall provide just one or two. We are improving transport. The regulations came into force nearly two years ago, and apply to new vehicles entering service from January last year. We have consulted on draft regulations for buses and coaches used on local and scheduled services. Final regulations are in the process of completion. We have extended the scope of provisions relating to building regulations to apply to all new homes. That represents a significant step forward in providing more accessible housing.
We are giving people greater control over their lives, and enabling them to make their own decisions about how their care is delivered. We want to see the full range of benefits from direct payments made available to more people, and recently extended direct payments to people aged 65 and over. This is where the question asked by my noble friend Lord Longford comes into play. The Government appreciate that old age and disability often go hand in hand. We believe that the rights that should be given to disabled people should of course also be given to those who are elderly. The provision to extend direct payments to disabled 16 and 17 year-olds and parent-carers of disabled children is included in the Carers and Disabled Children Bill.
Media information and attitudes are another matter raised in the plan of action. Access to information is crucial, as well as raising awareness of disability in changing attitudes. These are areas where the Commission will be working hard. But we have not been idle. In June last year, we launched our "see the person" campaign, which through advertising and distributing information seeks to challenge people's attitudes to disability and improve awareness of the DDA. We know that the campaign offended some people, and we regret that. But it has been successful in raising awareness and in challenging attitudes, and we make no apology for it.
RI's plan of action, which supports the charter, refers to the need for role models in the media. Disabled people can and must have access to, and

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participate in, our cultural life. Disabled people should figure in programmes of all kinds, without there being a special issue about their disability. We are pleased to say that guidance for broadcasters and programme makers produced by the ITC, BSC and the BBC speaks of the need to avoid prejudice and stereotyping. Of course the noble Lord, Lord Addington, was right to say that as a country we have been slow to come forward with what now seems obvious, but at least we have clearly moved in the right direction in some areas during the past few years.
Our debate has illustrated some of the barriers that disabled people face in their quest for civil rights. Our aim, and the aim of all, from all parties and none, is for equality of opportunity and a fully inclusive society. The most frequently asked question has concerned the request in the plan for action for support for a convention of the United Nations. On behalf of the Government, I should say that the Government are committed to supporting comprehensive and
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enforceable civil rights for their citizens, and would wish to see such rights enjoyed by citizens throughout the world.
We shall look carefully at the proposals for a convention. We welcome the charter as a spur for debate and progress on these important issues. I end by using the words which noble Lords who were present at the important meeting with the Prime Minister some days ago may recall, namely, that we are sure that, like its predecessor, this charter will form the basis for global consensus on our priorities for at least the next decade. I thank noble Lords for taking part in the debate.
Baroness Farrington of Ribbleton: My Lords, I apologise to the noble Lady, Baroness D'Arcy de Knayth, and other noble Lords for the fact that the debate took place at a far later time than anticipated. I place on record the Government's gratitude to the staff, including our Hansard writers.
House adjourned at fifteen minutes before seven o'clock.