Lords Sitting of 22 November 2000

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Chichester.

Age Discrimination in the Civil Service
Lord Janner of Braunstone Lord Janner of Braunstone asked Her Majesty's Government:
Whether they will take action to remove rules within the Civil Service which discriminate on grounds of age, and in particular the requirement to retire at the age of 60.
The Minister of State, Cabinet Office (Lord Falconer of Thoroton): My Lords, it is government policy that there should be no unfair discrimination in the Civil Service on the basis of age. Best practice to remove any discrimination on the grounds of age in recruitment, training and promotion is contained in my department's guidance to departments and agencies on age diversity.
Departments and agencies are free to set the normal retirement age for their own staff outside the senior Civil Service. This can be above 60. In the light of the Winning the Generation Game report by the Performance and Innovation Unit, the Cabinet Office is currently considering with departments and agencies changes in their policy on normal retirement age, as recommended in the report, and will consider the implications of extending any changes to the senior ranks of the Civil Service.
Lord Janner of Braunstone: My Lords, I thank my noble and learned friend for that Answer, particularly for the first signs of change in the Civil Service. Surely, it is by definition a form of unfair discrimination to force people into retirement at the age of 60 and the Civil Service above all should not engage in it. I can see no reason why any government department should be permitted to impose a form of institutionalised ageism of the worst kind.
Will my noble friend accept that, if it applied to people in this House, whether for their work here or elsewhere, many of us, including my noble friend Lord Winston, would be driven out of work at just the age when we are becoming mature and ready to serve society at our best?
Lord Falconer of Thoroton: My Lords, I do not know when my noble friend Lord Winston will be driven out of work but I agree that in many cases the age of 60 is the wrong age to require people to retire. The effect of the report of the Performance and Innovation Unit, Winning the Generation Game, was that all government departments are required to see whether they can extend the retirement age. They are
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in the process of doing so and by 30th September 2001 they must come back to the Cabinet Office with a case for not extending it to the age of 65.
Lord Winston: My Lords, is my noble and learned friend aware that I can still get to my feet? A serious issue exists because population profiles of the United Kingdom show that within the next decade, and certainly this century, approximately 1 per cent of the population will be over 100 years old. Many people in the older age group will be increasingly fit. Moreover, if the existing retirement age limit continues, less than 40 per cent of the population will be earning. Is not there a clear need to re-evaluate the use of older people in our society as working members of that society?
Lord Falconer of Thoroton: My Lords, I am pleased to see that my noble friend is still able to get to his feet! I agree entirely with what he said. Far too many people lose the opportunity both to fulfil themselves and to give to society by being forced out of work at much too young an age. We need to look fundamentally at the way in which people can be more engaged in work and make other contributions in the years after 60.
Lord Lipsey: My Lords, will my noble and learned friend agree that there is at least the consolation that many senior civil servants who retire at 60 undertake useful work after retirement, including many in this House? Will he also agree that there exists within the senior Civil Service a dilemma that unless the older ones go the younger ones will not stay because they are not paid much and the prospect of promotion is the one thing which keeps many of them on?
Lord Falconer of Thoroton: My Lords, I agree that many senior civil servants who retire at the age of 60 have many opportunities to work in other walks of life in both the public service and the private sector. I also agree that the retirement age must be examined in terms of encouraging younger people to begin careers in the Civil Service. However, an appropriate balance must be struck.
Lord Davies of Coity: My Lords, will my noble and learned friend add to the answer he gave to a previous question? Will he agree that the issue relates not only to career prospects but also to finding employment for youngsters who enter the job market after leaving school? If there is no retirement age somewhere along the line, will there not be higher unemployment in the younger age group?
Lord Falconer of Thoroton: My Lords, that is the point which was made in a different form by my noble friend Lord Lipsey. A balance must be struck between, on the one hand, ensuring that people have an opportunity to fulfil themselves after age 60 but, on the

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other, ensuring that there are gaps enabling younger people to take jobs and to be promoted when they have them.
Lord Craig of Radley: My Lords, will the Minister accept that as regards the Armed Forces a retirement age of 60 and above may well be wrong and that we do not want to end up with a "Dad's Army"?
Lord Falconer of Thoroton: My Lords, I stray with diffidence into the case of the Armed Forces. I can see the problem with a "Dad's Army" but, as the noble and gallant Lord proves, many able and gallant soldiers have much to contribute after 60.
Earl Jellicoe: My Lords, some 30 years ago when I was—I believe—in day-to-day charge of the Civil Service I was very worried by the fact that those who reached the age of 60—for example, ambassadors who had just got to terms with the countries to which they had been appointed—had to leave the service. Is the noble and learned Lord aware that I am very glad to hear that consideration is to be given to the introduction of flexibility into the present arrangements?
Lord Falconer of Thoroton: My Lords, I am grateful for the noble Earl's support for the proposal. The fact that the noble Earl was head of the Civil Service 30 years ago indicates how many useful years he had beyond that post.
Lord Ezra: My Lords, as to flexibility, will reconsideration of this matter include the possibility of part-time employment? Does the Minister agree that a considerable number of people with careers in the Civil Service, engineering and elsewhere have much to contribute but may not want to do it as a full-time occupation? Does the noble and learned Lord agree that if it was part-time work it would not stand in the way of younger people who thrust forward?
Lord Falconer of Thoroton: My Lords, it is right that that very important point should also be considered. Obviously, a balance must be struck between the opportunities for part-time work and the creation of opportunities for people as they pursue their careers.
Baroness O'Cathain: My Lords, does the Minister agree that another balance to be struck is between the worthy aim of individuals to have different careers, with the avoidance of logjams in the promotion of young people, and the question of pensions and the funding thereof? Does the noble and learned Lord agree that we must be extremely careful about what rabbits we allow to run here because the implications for pensions, particularly in the Civil Service, are horrendous?
Lord Falconer of Thoroton: My Lords, the retirement age is the age for which pension funds make
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appropriate funding. However, pension entitlement and the extent to which a person should be allowed to continue to work may be two different matters.
Viscount Simon: My Lords, does my noble and learned friend agree that a retirement age well before 60 should be encouraged for those involved in criminal acts?
Lord Falconer of Thoroton: My Lords, I believe that that very much depends on the criminal act.

World Poverty Reduction Targets
2.45 p.m.
The Earl of Sandwich The Earl of Sandwich asked Her Majesty's Government:
How far they have succeeded in meeting their 1997 target of halving the proportion (23 per cent in 1995) of the world population living in extreme poverty by 2015.
Baroness Amos: My Lords, the target to halve the proportion of people who live in extreme poverty by 2015 is one of seven that were agreed by the international community at the series of United Nations' global conferences held in the past decade and now form the centrepiece of the international development effort. Progress is measured from 1990 when 29 per cent of people in developing countries lived in extreme poverty.
The Earl of Sandwich: My Lords, I thank the Minister for that reply. Does the noble Baroness agree that the international development targets which were set five years ago in Beijing and Copenhagen are now beginning to look unrealistic, given that the poverty reduction strategies in those countries are at a very early stage? Does the noble Baroness agree that it would be safer to set up intermediate development targets every five years to enable those countries effectively to monitor and evaluate their progress?
Baroness Amos: My Lords, I do not agree with the noble Earl that the targets are unrealistic. Although the targets are difficult, they are achievable if there is strong political will and commitment behind them. The international development targets are important because they are a commitment by all the members of the UN. The noble Earl asked specifically about the setting of intermediate targets. Individual countries, through their poverty reduction strategies, set intermediate targets. If countries write poverty reduction strategies, the inclusion of long-term, medium-term and intermediate-term targets which they intend to reach at specific points is compulsory. Both of those matters are important. Individual countries have the opportunity to set intermediate targets, but international development targets are an international effort.
Lord Redesdale: My Lords, does the Minister agree that some of the countries in sub-Saharan Africa are

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going backwards at the moment? Considering that the targets for Africa are not being met, will there be a reassessment of viable targets in Geneva in June? In asking that question, I recognise the good work that DfID has done over the past five years.
Baroness Amos: My Lords, we are experiencing difficulty in meeting the targets in sub-Saharan Africa for a number of reasons, including the scale and spread of HIV/AIDS and the degree of conflict in many of those countries. But it is important to recognise that there are differences between countries in sub-Saharan Africa. For example, Nigeria and South Africa have a very good record in economic growth. Therefore, we should not be pessimistic about the region as a whole. As for a reassessment of our ability to meet the targets in sub-Saharan Africa, I repeat my response to the noble Earl, Lord Sandwich. As a global community it is important to have a commitment to a set of international targets. How we apply those targets in individual countries will depend partly on the degree of commitment by those countries to putting in place pro-poor development policies. We do not want to roll back from the commitment to those targets, but clearly when countries put in place their poverty reduction strategies we shall look at what they can realistically achieve.
Baroness Rawlings: My Lords, we all agree that one of the main routes towards the successful eradication of world poverty is through the education of adolescents, especially young girls. Can the Minister tell the House what additional plans Her Majesty's Government have prepared to target female education and healthcare? Does DfID have any links with important charities in this field, such as the International Women's Health Coalition and AMR EF?
Baroness Amos: My Lords, I am in total agreement with the noble Baroness that it is important to invest in education. It has been shown that such investment is one of the most important determinants in meeting all the other targets, including health and poverty targets, because of what happens to families where, for example, mothers and daughters have been educated. In the past three years we have committed £400 million to support primary education programmes, all with a strong focus on gender equality. The noble Baroness will be aware that of the nearly 900 million people across the world who are illiterate 600 million are women. So the education targets are very important indeed.
The noble Baroness asked about health. Infant and under-five mortality rates fell by more than half between 1960 and 1990. But progress has slowed during the 1990s. In most regions, particularly sub-Saharan Africa, which we have already mentioned, a big effort will be needed to meet the targets.
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The noble Baroness asked also about AMREF and one other organisation. We are in touch with AMREF. I had a meeting with AMREF relatively recently. We are in touch with a number of NGOs which are working in this area.
Lord Tomlinson: My Lords, in pursuit of the objective of poverty reduction, will the Minister ensure that European Commissioner Lamy's proposals in the "Everything but Arms" initiative do not prejudice either Article 12 of the Cotonou agreement, which provides for prior consultation with the African, Caribbean and Pacific countries if their interests are detrimentally affected, or the legal status of the sugar protocol or the sugar regime proposals which, inter alia, provide for the renegotiation of the special preferential sugar agreement? Either of those will have a serious effect on Caribbean producers. It would be wrong to pursue poverty reduction in some parts of the world at the expense of creating poverty in others.
Baroness Amos: My Lords, my noble friend will be aware that we worked extremely hard in the successor to the Lomé Convention to protect the interests of Caribbean producers. We shall continue so to do. In principle, we support "Everything but Arms" and we are willing to work with the European Commission to help Caribbean industries adjust. We want to look at the impact of "Everything but Arms" on Caribbean countries. However, I reiterate to my noble friend that we want to protect the interests of Caribbean producers.
Lord Bridges: My Lords, perhaps I may ask the noble Baroness a question which has puzzled me for some time. For so long as we define poverty as a percentage of GNP, how can we hope to arrive at its abolition?
Baroness Amos: My Lords, it is important that we recognise that poverty reduction is not just about aid to developing countries; it is about development and in particular looking at the capacity of developing countries to improve economically. Therefore, part of our strategy relies on seeking to work with business and with other partners to achieve economic prosperity and growth in developing countries.

Speech and Language Therapists
2.53 p.m.
Lord Faulkner of Worcester Lord Faulkner of Worcester asked Her Majesty's Government:
Whether the levels of recruitment and retention of speech and language therapists are satisfactory.
The Parliamentary Under-Secretary of State, Department of Health (Lord Hunt of Kings Heath): My Lords, the number of qualified speech and language therapists increased by 310 between September 1997 and September 1999. The NHS plan will see a further 6,500 therapists and other health professionals by

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2004. The department's recruitment and retention strategy embraces this important and valued group of staff.
Lord Faulkner of Worcester: My Lords, I thank my noble friend for that reply. Is he aware that there is still a serious shortage of therapists? As a result, waiting lists are long and vulnerable children are not getting the assessments and treatment that they need. Is he satisfied that the problems which were identified in the study carried out by the Royal College of Speech and Language Therapists last year of poor morale, low pay and poor recognition have been addressed and that, therefore, speech and language therapists can expect the increase in recruitment to which my noble friend referred and can continue to perform their absolutely invaluable role in helping children overcome their communication difficulties?
Lord Hunt of Kings Heath: My Lords, I certainly share my noble friend's view of the importance of speech therapists. I also acknowledge, as I did in my main Answer, that we need to see further increases in the number of speech and language therapists employed within the National Health Service. We have made good progress in the past two years; and we shall be looking at the number of training places that are available as one way in which to increase the numbers of therapists in the long term.
My noble friend referred to morale. In common with other groups of non-pay review body staff, speech and language therapists have benefited from an above inflation pay increase this year. Additionally, a new pay and grading structure was introduced on 1st April 2000. This importantly extended the existing pay spine for speech therapists in line with that of clinical psychologists. That will increase the pay availability for senior speech and language therapists by around £20,000.
Lord Clement-Jones: My Lords, I welcome what the Minister said on cases of equal value and the settlement of those cases earlier in the year. One of the reasons for problems with the morale of speech and language therapists referred to in the survey mentioned by the noble Lord, Lord Faulkner, is the constant change in reorganisation of the National Health Service. How will the Government's new proposals on regulation of the professions allied to medicine improve that? Surely, they will only compound that problem.
Lord Hunt of Kings Heath: My Lords, I do not agree with that but over the past 20 years the various managerial changes have adversely impacted on many of the professions allied and supplementary to medicine. Part of our strategy in relation to those professions is to ensure that at local level their views, concerns and management are given sufficient attention by the boards of NHS trusts.
But so far as concerns regulation, what is proposed in the consultation paper that we are considering will enhance the whole regulatory process for this and
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other similar professions. It will speed up disciplinary processes and enhance public confidence. Through that I believe new confidence will be established among the professions.
Lord Campbell of Croy: My Lords, since speech therapists were accepted as a profession supplementary to medicine, does the noble Lord agree that there has been an increasing demand for them and never enough of them, particularly because they can perform important functions, for example, when someone has a sudden paralysing stroke and all means of communication come to an end?
Lord Hunt of Kings Heath: My Lords, I do not disagree at all with what the noble Lord has said. There is no doubt that communication is vital to everyone's lives in this country. Speech and language therapists work with people of all ages, not just children. They have a valuable role to play. I am sure that in the future we will need even more speech therapists than we have at the moment. That is why, alongside a review of the training places, we shall be working with the appropriate professional body to examine our future requirements to make sure that the NHS is in a position to take advantage of the profession.
Lord Rix: My Lords, is the Minister aware of the extreme difficulty faced by adults, as opposed to children, with a learning disability in accessing the services of people concerned with speech therapy? If the Minister is so aware, can he suggest solution to the problem?
Lord Hunt of Kings Heath: My Lords, I am well aware of the issues that are being faced and of the waiting that some members of the public undergo in order to access speech and language therapists. We are making progress. We have seen an increase in the numbers of therapists employed in the past two years. We shall be increasing the number of training places. Most importantly, we have commissioned a labour market analysis of speech and language therapists. The result of that project, which is expected next spring, will be used to inform recommendations on future training places. Clearly, that takes time. I want to ensure that in the meantime we do everything we can to recruit more people back into the profession.
Lord Clinton-Davis: My Lords, I declare an interest as someone who suffered a stroke and has had invaluable help from a speech therapist. While the Government certainly deserve a great deal of praise for what they have done, does my noble friend agree that there is a housing problem for NHS staff in London and the South East? What steps are the Government taking to deal with that problem?
Lord Hunt of Kings Heath: My Lords, my noble friend is absolutely right. The long-term vacancies for speech therapists in London are 5.9 per cent compared with the English average of 3.4 per cent. We are exercised in relation to the facilitation of affordable

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accommodation for NHS staff in London. We have appointed Mr John Yates to help us develop schemes to arrange affordable accommodation for such staff. Those will include speech therapists.

NHS Plan
3.1 p.m.
Baroness Carnegy of Lour Baroness Carnegy of Lour asked Her Majesty's Government:
What is their reaction to the statement by the Chairman of the British Medical Association that the National Health Service Plan is not deliverable in the timescale envisaged.
Lord Hunt of Kings Heath: My Lords, we are determined to ensure that the NHS Plan represents a step-change for the health service that is both affordable and deliverable. I am confident that the plan can and will be delivered within the set timescales.
Baroness Carnegy of Lour: My Lords, it has been suggested that what the British Medical Association has been saying is simply a spin designed to affect the pay review for doctors which is presently under way. Can 1he Minister confirm that, far from that being the case, the BMA gave detailed views as to its anxieties on the day the plan was announced—at the end of July—and that since then other bodies have confirmed very much the same view? I refer to the Royal College of General Practitioners, the National Health Service Alliance and the National Association of Primary Care. All those bodies have detailed anxieties. Will the Government pay attention to the views of general practitioners?
Lord Hunt of Kings Heath: My Lords, I suppose it depends on which Dr Bogle we are listening to. Is it the Dr Bogle to whom the noble Baroness refers, or is it the Dr Bogle who said on 7th September 2000:
"Overall, the NHS plan is an exceedingly good document. It shows a desire from Government, patients and those working in the health service to achieve the best health service in the world"?
That was a fairly strong commendation of the NHS plan. Of course we will listen to what organisations such as the BMA have to say to us, but we are confident that the figures in the NHS Plan are robust. We see primary care as an integral part of the development of the plan. I am confident that the targets we have set of 2,000 extra GPs by 2004 will be met.
Lord Clement-Jones: My Lords, is not one of the ways of relieving pressure on GPs to allow much more nurse prescribing in primary care? The Government issued a paper in August but consultation is still going on. At a time when the Government are facing demands for more GPs, why are the Government dragging their heels in the area of nurse prescribing?
Lord Hunt of Kings Heath: My Lords, the Government are certainly not dragging their heels. Nurse prescribing has proved to be very important indeed. We are keen to develop it as soon as we can. I can assure the noble Lord that we will be bringing our conclusions to the House as soon as we possibly can.
Baroness Trumpington: My Lords, I heard what the Minister said about 2,000 extra GPs by 2004. Does he agree that that still puts us in the third division of world health systems? If he so wishes, I can refer to Greece, Germany and France. How does the noble Lord equate the figure of an extra 2,000 GPs with the plan's idea of a patient being able to see his GP within 48 hours, which I understand the BMA. says is totally unrealistic?
Lord Hunt of Kings Heath: My Lords, I do not agree with the noble Baroness. She may be referring to the number of doctors employed in each healthcare system. If she is, I would certainly acknowledge that this country has traditionally employed fewer doctors than many other healthcare systems. That is one of the reasons why we are committed to increasing the number of GPs and hospital consultants. But I would also say that in this country we have a very good record of using other staff, such as nurses, to do work that might be done in other healthcare systems by doctors. The noble Lord, Lord Clement-Jones, has already referred to the potential of nurse prescribing.
The noble Baroness referred to the 48-hour limit. Perhaps I may quote from Dr Adrian Attard, whose practice is participating in a primary care collaborative. The practice has cut its waiting times from five to six days to the Government's target time of 48 hours. Dr Attard said:
"We are not doing any extra surgeries and we are not working harder than before, we are just working in a different way".
Many of the ways in which we can achieve the 48-hour limit will be by GPs working more effectively.
Lord Winston: My Lords, can my noble friend confirm that a number of senior members of the British Medical Association, having read the national plan, signed an endorsement of it before it was published, as did many major leaders in the healthcare professions? Does he not agree that the great majority of the medical professions welcome the national plan and intend to work with it?
Lord Hunt of Kings Heath: My Lords, there is no doubt about that. The 150 or so people who were involved in writing the NHS plan included many doctors. Many distinguished doctors signed up to the core values at the beginning of the NHS Plan. I can do no better than to quote from The Times, which is always to be believed in these matters. It quoted Sir George Alberti, President of the Royal College of Physicians, who urged Dr Bogle on 21st November to "stop belly-aching" and start innovating.

Business
Lord Carter: My Lords, after the Third Reading of the Freedom of Information Bill, my noble friend Lady Symons of Vernham Dean will, with the leave of the House, repeat a Statement being made in another place on European defence co-operation.

Freedom of Information Bill
3.7 p.m.
Read a third time.
Clause 2 [Effect of the exemptions in Part II]:
Lord Lucas Lord Lucas moved Amendment No. 1:
Page 2, leave out line 31.
The noble Lord said: My Lords, if it does not trouble the noble and learned Lord, Lord Falconer, too much, I should like further to shorten our proceedings today by speaking not only to Amendment No. 1 but also to Amendment No. 7. My point on the two amendments is the same.
The Bill will come into force in 2005. That is also the year when we are promised that we will have full electronic government. Other Bills that have been before us this Session—notably those coming out of the Department of the Environment, Transport and the Regions—have made full provision for the coming electronic nature of government and of government information. The Bill, which is all about information, still does not.
In these two amendments I offer two ways in which the Government can remedy that defect. Amendment No. 1 removes the inability of an applicant to receive information in electronic form if it is information which is already published in some other form—in other words, just because some ancient statute prescribes that information should be published in writing, and that is what the public authority does, there will be no right to receive it in electronic form. The other way is to put something in the statement of good practice to make it clear that, by the time the Bill comes into force, we would expect information generally to be made available in electronic form.
The Government promise a great deal in this area; indeed, they have always done so. However, as the noble Lord, Lord McIntosh, will confirm, they still do not send Answers to my Parliamentary Questions by e-mail. I hope that, one day, the Government will get around to fulfilling the promises they have made. At the very least, they ought to be consistent in their promises. I beg to move.
Lord Mackay of Ardbrecknish: My Lords, I have a great deal of sympathy with the amendments tabled by my noble friend, who certainly knows a thing or two more than I do about e-mail, the Internet and so forth. He is quite right to pursue this issue. Furthermore, he is right to point out that we have not seen a great deal of joined-up thinking across government on this. For example, when we debated yesterday the Political
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Parties, Elections and Referendums Bill, we exposed the fact that electoral registers will not be available in a unified form on e-mail for the commencement of the Bill next year, even though they form an important part of how the provisions of the Bill are to operate. That provides another example of the point that my noble friend seeks to make here.
If the Government are serious about moving into the e-commerce age—we were told constantly that they were serious when we dealt with the Electronic Communications Bill covering e-commerce—they must ensure that they themselves have entered the electronic age.
Lord Falconer of Thoroton: My Lords, perhaps I may deal first with Amendment No. 7, which refers specifically to communication by "electronic means". The noble Lord quite fairly indicated that he covered this matter at earlier stages of our deliberations on the Bill. We responded to his points and I fear that my answer today may be quite similar to previous responses that he has received.
Amendment No. 7 deals with the code of practice. The code will provide guidance to public authorities to meet their obligations under Part I of the Bill. Clause 11 already puts clear duties on authorities to comply, as far as is reasonably practicable, with the applicant's expressed preference for communication. This will include the provision of information by electronic means. Thus there is no need to include any specific reference to the provision of information by electronic means so far as concerns the method of response to requests for information.
It is worth remembering that a wide range of public authorities will be required to comply with the provisions of the Bill. The figure of 50,000 such public authorities was given on a previous occasion. Some of those bodies will be very small indeed, while some may be comparatively poorly resourced as regards information technology. It would be inappropriate to make electronic or any other means of communication a recommended method for communicating information under the terms of the Bill. The Freedom of Information Bill is extremely important, but for many of those 50,000 public authorities, the delivery of their mainstream activities will be even more important.
Each authority must do what is reasonably practicable, taking into account its individual circumstances. It may be that the noble Lord has in mind the importance of encouraging the electronic information age. Indeed, he has made that specific point clear. That is, of course, a matter which is close to the Government's heart, as the noble Lord, Lord Mackay of Ardbrecknish, pointed out. Furthermore, I believe that we hold a commendable record in the area. As the noble Lord is no doubt aware, Clause 19 relates to publication schemes that will provide the vehicles by which proactive disclosure is required. Publication schemes must specify the manner in which information to be made available proactively by the authority is to be published. The information commissioner must approve such schemes. Therefore the means by which

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authorities make information available in accordance with the publication schemes is a matter over which the commissioner will have direct control.
If the information commissioner thinks that an authority is not making appropriate use of electronic communication in a given set of circumstances, she can require the authority to include the necessary provisions in its scheme. That would seem to be the most appropriate way to ensure that the intention behind Amendment No. 7 is met. I hope that the noble Lord will find this response to be of assistance as regards Amendment No. 7. Although the means may be different from that which he has proposed, the intentions are similar.
Amendment No. 1 seeks, in effect, to remove Clause 21 from the absolute exemptions. This clause refers to information that is already available through other means. The Bill concerns freedom of information. If that information is already available by other means, and the question of whether such information has been made readily available is a point on which the information commissioner can rule, then there is no need to address it under the terms of Clause 2. For that reason, I believe that it would be inappropriate to set down anything other than an absolute exemption for Clause 21.
I hope that my remarks have been useful to the noble Lord and that now he will feel able to withdraw Amendment No. 1 and not move Amendment No. 7.
Lord Lucas: My Lords, I believe that that is the best response that I am going to get here. I draw a little comfort from the point made by the noble and learned Lord as regards the powers of the information commissioner. However, I do not draw much comfort at all from his proposition that, in 2005, a number of public authorities will still be poorly resourced as regards information technology. His noble friend mentioned that some doctors would still not be using computers by that year. I do not know of a school which does not already have 2,000 computers in place. Similarly, I do not know of a doctor who is not well advanced in the use of information technology, employing it increasingly for medical diagnosis, checking on the side-effects of pills and so forth. I believe that the noble and learned Lord may be a little out of date on the capabilities of public authorities—or at least I hope that he is.
If the noble and learned Lord is truly suggesting that in 2005 we shall still have public authorities that are not well provided for in information technology, would he let me know which authorities are so affected? Perhaps I might then have a go at doing something about the situation. Otherwise, I shall assume that the noble and learned Lord is simply less well informed than is usually the case.
I shall withdraw the amendments. I hope that, in this instance, the Government will live up to their fine words. With that hope, I beg leave to withdraw the amendment..
Amendment, by leave, withdrawn.
3.15 p.m..
Clause 15 [Special provisions relating to public records transferred to Public Record Office, etc.]:
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 2:
Page 9, line 10, after ("is") insert ("expressed to be").
The noble and learned Lord said: My Lords, in moving Amendment No. 2, perhaps I may speak also to Amendment No. 8. These are technical amendments, consequential on amendments tabled on Report by the noble Lords, Lord McNally, Lord Lester of Herne Hill and Lord Goodhart, to which noble Lords agreed. They help to clarify the relationship between Clause 2 and those provisions in Part II which deal with the duty to confirm or deny that the requested information is held. I beg o move.
On Question, amendment agreed to.
Clause 35 [Formulation of government policy, etc.
Baroness Whitaker Baroness Whitaker moved Amendment No.3:
Page 21, line 4, at end insert—
("() Information consisting of—

(a) scientific, medical or technical data,

(b) the analysis of such data, or

(c) the opinion of a scientific, medical or technical expert as to the interpretation or significance of such data or analysis,

is not exempt by virtue of subsection (1)(a) or section 36(2)(b) or (c).").
The noble Baroness said: My Lords, in speaking to Amendment No. 3, I should say, first, that the Bill is now much improved. When one works through the way in which the Bill is to operate, there is a kind of groundswell towards public access to the factual basis of decisions, which is capable of being translated into the culture of change which my noble and learned friend presaged earlier. However, this process remains tortuous. It is not easy for the citizen to follow and particular concerns have been expressed about areas such as scientific facts and their analysis, on which can turn life and death.
This amendment would exclude scientific data, analysis and opinions from the scope of Clause 35(1)(a), the government policy formulation exemption clause, along with the related exemptions in Clause 36. This amendment is more limited in its scope than previous amendments tabled at earlier stages. It applies only to factual information which is scientific, medical or technical. However, it goes beyond the data themselves. It applies to data, the analysis of data and expert opinion on the interpretation or significance of the data or analysis. In effect, those are the three ingredients that go into a published scientific paper. Government scientists may also offer advice on the policy that should be adopted in the light of findings. The amendment does not extend to that advice. It is limited to scientific opinion on the significance of the data.
Thus, a government scientist looking at data on the outbreak of BSE might recognise that the disease was continuing to strike, despite the fact that controls had been introduced. He might suggest that the

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implication was either that the controls were not being properly applied or that the disease was being transmitted in a previously unsuspected manner. All those implications would be open to disclosure as a result of this amendment.
I think, but would be relieved to be corrected, that the so-called "harm test"—or, as the noble Lord, Lord Goodhart, put it, a "prejudice test in all but name"—as now achieved in the Bill, would not necessarily bite on a particular document—for example, our scientists' paper—if the Government believed that there was a public interest in ensuring that all the ingredients of their internal deliberations remained confidential to allow for the free exchange of views. In the same way, a report on vaccine damage which dealt only with the possible risks of the vaccine to individuals and not with the aggregate benefits might also fall into this category.
The amendment reflects the concerns expressed by the national Consumers' Association and the Freedom of Information Campaign. Without it, can my noble and learned friend persuade us that there will be a true right to the scientific, technical and medical data analysis and interpretation on which turn such crucial political decisions?
Lord Lucas: My Lords, Amendment No. 4 in this group stands in my name. The amendment seeks to write into the Freedom of Information Bill words which are contained in the code but which the Government have omitted from the Bill. There is a lot to be said for doing our best to make sure that the Bill is at least as good as the code. This is one respect out of several, I am sad to say, where the Bill falls short of what is contained in the current code.
The noble and learned Lord, Lord Falconer, has been kind enough to write to me twice on this subject. In his latest letter he has clearly set out how he sees the difference between fact and analysis. I hope that the noble and learned Lord will not object if I quote from the letter.
Lord Falconer of Thoroton: No.
Lord Lucas: My Lords, the letter states:
At one extreme, analysis may be no more than separating a fact into its component parts, tabling and perhaps statistically comparing them. Where such an exercise does not, for example, require any assessment of the relative weight or merit of the information, it would in my view be difficult for a public authority to make the case that such analysis should be withheld…
"At the other extreme, the analysis of facts will require a public authority to determine or attribute a weight to the whole, or one or more component parts, to compare and contrast the merit of one part relative to another or to speculate on assumptions which may underlie or be evidenced by any statistical comparison. In such a case, it seems to me that the 'analysis' becomes much less dispassionate and is closer to opinion than fact".
I read that to say that if the noble and learned Lord were presented with a scientific paper, he would fillet it. He would leave in the tables, but anything which constituted the application of a lifetime's accumulated expertise to those facts would be eliminated. It would
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be opinion and therefore would not be freely available to the public. That is a terrible state of affairs. It would certainly have caused a great deal of difficulty if this had been the practice when we were faced with BSE and we were hoping that this new Bill would allow us to avoid its main consequences.
It is quite clear that the wording of the code encompasses the idea that the analysis of factual information by someone who is equipped to do so, rather than by someone providing mere speculation, is an integral part of that information being made understandable to the general public. If we have only a table of the results of some medical experiment and we are asked, as members of the public, to draw conclusions from it, we are set at a great disadvantage. We are deprived of the expertise of researchers, perhaps of the Chief Medical Officer or of someone who understands what is going on. That is not the way in which information should be treated and viewed.
I hope that the noble and learned Lord will reconsider this issue. At an earlier stage he described statistical information by sending me extracts from papers containing statistics. The extracts did indeed contain statistics, but they also contained a good deal of building on those statistics and drawing conclusions from them. Those statistics related to crime in a particular area of Britain and were being put forward to support a case for CCTV cameras in the area. Statistics are fine, but unless the arguments about what has been achieved elsewhere with CCTV cameras, the relevant statistics in other parts of the country and the comparisons and conclusions to be drawn from that are set out, you are left with a meaningless collection of data. People are then at a great disadvantage in understanding what the Government are at and in trying to reach the right conclusions, which is one of the underlying purposes of the legislation—at least, I believe it to be one of the underlying purposes of this legislation.
I hope that even at this late stage the noble and learned Lord will reconsider and accept either the amendment of the noble Baroness, Lady Whitaker, which is admirably succinct, clear and limited in its objectives, or my more general call for this matter to be put back onto the basis which exists in the code at the moment. That basis will not exist unless we make some amendment to this particular aspect of the Bill.
Lord Archer of Sandwell: My Lords, my noble friend Lady Whitaker and the noble Lord, Lord Lucas, have focused our minds on the dangers of exempting from the right to disclosure a wide category of information without differentiating between the various kinds of information and the various situations in which the question may arise. Information relating to,
"the formulation or development of government policy"—
the words of the Bill—may concern a problem which falls to be addressed, what was said about it by someone, who provided the information, what statistics exist or how they may be analysed. The prejudice, if any, occasioned from disclosure of those various kinds of information in those various kinds of circumstances will be very different.

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The prejudice arising from disclosing to a totally unsuspecting public the first intimation that there may have been an outbreak of infected beef will be quite different from disclosing whether the number of cases is increasing or decreasing. If it is argued that it does not matter because everything is to be subjected to the balance of the public interest test in Clause 2, I hope that my noble and learned friend and the noble Lord, Lord Goodhart—both of whom have deployed that argument in previous debates—will forgive me if I say that that may require rather careful scrutiny.
Leaving aside the ministerial override in Clause 52—which we will debate later, but which, in any event, dulls the edge of that argument—I believe that it runs together a number of issues which should be considered separately. First, if there is no realistic danger that the disclosure of a particular category or sub-category of information would cause harm, then it ought not be in an exemption at all. The question of harm tests would not then arise and there would be no need for a balancing assessment under Clause 2. If there is a potential danger that its disclosure might cause harm, it should be subjected to a harm test. I do not believe that that is identical to the balancing of public interest in Clause 2.
The argument of the noble Lord, Lord Goodhart, in particular, appears to be—I hope I paraphrase him correctly—that it does not matter whether there is a prejudice test in a specific clause defining an exempted category because, even if the information in question falls within the exemption, the balancing of public interest is identical with the prejudice test. I wonder whether his rather cheerful optimism is justified.
Let us suppose that, in applying the public interest test, the Government were to argue, "We agree that there is no specific harm which would be occasioned by disclosing this particular information, but we believe that there is a public interest in maintaining the integrity of this whole category of information. It would do no harm to disclose the results of the tests conducted on this beef herd by this veterinary surgeon, but it might inhibit vets from passing on to the Government the results of their tests on other occasions".
The public interest test may well exclude from the right to disclosure information the disclosure of which would cause no specific harm because, it may be said, there is a public interest in maintaining the principle. That is not an academic supposition; it is an argument that has been used by Ministers in the course of our debates on the Bill.
3.30 p.m.
Lord Goodhart: My Lords, I am grateful to the noble and learned Lord for giving way. He is right. The public interest test could result in a decision against disclosure on the grounds, not of the consequences immediately following the disclosure of the particular facts of that case, but from the wider harm that might be done, for instance, by making it harder to obtain information in subsequent cases.
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The flaw in the noble and learned Lord's argument is that that point could equally be raised where there is a prejudice test. The prejudice does not have to be absolutely specific to the information the disclosure of which is sought; it could apply also to a wider harm that would be caused consequentially on disclosure of the particular facts of that case.
Lord Archer of Sandwell: My Lords, it might be. If I were drafting the Bill afresh—which, ipso facto, I shall not be allowed to do—I should want to make the distinction between those two tests very much clearer. But the psychology—the way in which someone's mind would work in addressing those two tests—might be very different. I shall argue that it might be too easy to introduce the test about maintaining the integrity of the whole category.
Perhaps I may give two instances where that has been cited by Ministers in the course of debates. Addressing this question in Committee in another place, my honourable friend David Lock, said:
"It is generally acknowledged that the Government must have time and space to evaluate policy options. That view is shared by all Committee members. The premature disclosure of information in those areas can only hamper, and in some—perhaps even most—instances, prejudice the effective conduct of public affairs. It follows that, for a significant proportion of the information falling into that category, disclosure will never be justifiable, even under a harm test … certain categories of information will always prejudice the effective conduct of public affairs".—[Official Report, Commons, Standing Committee B: 27/1/00; col. 293.]
On 24th October, my noble and learned friend said that the amendment then under discussion,
"would mean that the difficult questions, the uncomfortable options and unthinkable scenarios would not be debated as frequently or as clearly. Governance would suffer.That is why a class exemption rather than a harm test is the right way to achieve a balance for good and open government".
He went on to say:
"Cabinet papers and minutes would always be likely to prejudice the effective conduct of public affairs".—[Official Report, 24/10/00; cols. 282–3.]
Even where there is to be a public interest test, the category exemption is not the same as the harm test. That is a point of view, but it is certainly not the same as arguing that because of Clause 2 we already have a harm test.
It is too easy for a government or a public authority to decide that disclosing information in a particular category is always against the public interest. Some of us believe that the Government should have to undergo the discipline of actually directing their mind to the harm that would result from the disclosure of the particular information in question; or at least, where they seek to exclude by category, that the definition of that category should be subject to careful scrutiny, as my noble friend seeks to bring about.
What is certain is that, for that reason, a balancing of public interest is not a complete substitute for a harm test. That was the argument of my noble and learned friend himself. The object of the amendment is to compel Ministers and public authorities to focus their minds on the question of whether disclosure would occasion a specific form of harm. To argue that

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that exercise is superfluous because there is always a balancing of public interest at the end of the course is to circumvent the whole scheme of the Bill. If that were the whole test, we should not have needed to trouble with all the clauses defining the exemptions.
If the Bill is to achieve its objective, a request for information should be considered in three stages: first, does it fall within a category of information which has a potential for causing harm—we should define the category with some care; secondly—and only if it does—is there some specific harm which may be
caused in this particular instance; if so, thirdly—and
only then—where does the balance of public interest
lie? My noble friend's amendment is directed to the first of those questions. It is on that question that the debate should focus.
Perhaps I may seize this opportunity—since it will be my last opportunity in the course of our debates—to thank my noble and learned friend for the care with which he has addressed our arguments throughout and for his unfailing courtesy.
Lord Lester of Herne Hill: My Lords, I apologise to the House for the fact that, for reasons given by the Select Committee on Science and Technology, air travel and health, I shall be even more difficult to listen to than normal. If at some point I choke, the House will realise that that is not on argument, but for other reasons!
I should like to try to explain, for the last time I am sure, why I believe that the Bill as it stands now provides a proper constitutional and legal framework for balancing the competing public interests. My starting-point is Article 10 of the European Convention on Human Rights, which guarantees the right to free speech, subject to necessary exceptions.
Article 10 does not segment information and ideas into little categories. What it does is to treat all information and ideas as being the subject matter of the right to freedom of communication and the receipt of information and ideas. It then subjects that right to necessary exceptions. Those exceptions are scrutinised carefully as exceptions to a fundamental right, using the well-known principles of proportionality.
The other relevant convention right in Article 8 is to personal privacy, which is one of the exceptions that has to be balanced against free speech. Again, it does not seek to segment the subject; it balances these two fundamental rights using proportionality. So if we had no freedom of information Bill but simply the European Convention on Human Rights as our framework, the information commissioner/the Data Protection Commissioner, being the same person, would be balancing free speech on the one hand covering information and ideas against personal privacy on the other.
But the great weakness of Article 10 as a touchstone is that it has not been interpreted by the European Court of Human Rights yet as giving a general right of access to official information. So, although it applies to the balance between free speech and a fair trial, free
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speech and copyright, or free speech and official secrecy, it does not guarantee a positive right of the public to government information.
One of the most important things that we have achieved in this House in relation to the Bill is that we have repaired the weakness in Article 10, effectively by writing in to Article 10 a right of public access to information and ideas—not subject to particular categories, but subject only to necessary exceptions. There are two kinds of exceptions: those that are absolute, where there is no balancing, and those that are qualified; for example, those that we are considering at present under Clause 35, which are not absolute but are subject to the public interest test.
It will not, ultimately, be for the Minister, for myself, for the noble and learned Lord, Lord Archer of Sandwell, or, indeed, for the Campaign for Freedom of Information to decide what Clause 2 means: it will be a matter for the information commissioner and, in the end, for the courts. I find it inconceivable that the information commissioner and the courts will apply a different standard to the freedom of information legislation from that to be applied to the Data Protection Act, which is the other side of the coin. It is possible that the Minister will say, as the Home Office will probably require him to say, that he does not necessarily accept everything that I say—I understand why he will say that. Thank heavens it will not be left to him, the Home Office or me to decide the matter. It will be a question for the judges to decide.
I find it inconceivable that the proportionality principle will not apply. There is no way in which that test is other than a harm test—a substantial harm or substantial prejudice test. What are the information commissioner and the courts doing when they weigh the right of access to government information against necessary exceptions? They are weighing whether there is a sufficiently substantial prejudice or harm to another facet of the public interest to justify, on an objective basis, curtailing the right of public access to information.
The noble Baroness, Lady Whitaker, and the noble Lord, Lord Lucas, both of whom deserve our gratitude for raising such issues in these amendments, are seeking to carve out as specially not capable of being qualified and balanced, information or analysis of particular kinds. I have great sympathy with what they seek to do. In the kind of cases covered by these amendments, I have no doubt that the Government would have a particularly hard time in justifying the withholding of the information for the reasons that they have given—and which I am sure other Members of the House will give—especially in the scientific area where there will be an overwhelmingly strong case in favour of disclosure.
In answer to the noble and learned Lord, Lord Archer of Sandwell, I also have no doubt that the Government would have an extremely hard time justifying the non-disclosure of whole categories of information on a hypothetical future basis, just as we found in the courts in the field of public interest

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immunity when what were called "class claims" were made. In the end, the courts said, "The game is up. You can't simply have very broad categories of information whose disclosure is completely and absolutely immune from disclosure in the circumstances of a particular case".
I apologise to the House for having taken so long with my remarks. As for some of those who have been strongly critical of those of us who support the general shape of the Bill as it now appears before us, I really believe that they continue not to understand that the terms of engagement are radically altered. The Home Office will deny that that is so; it will say that these changes are minimal. The Home Office will instruct its counsel in particular cases to argue the contrary, as is its right. However, it will be contrary to the whole of the decided case law of the Court of Appeal and of the House of Lords in a whole string of recent cases if those courts do not adopt the liberal principles that I believe we have succeeded in writing into the Bill.
As to the merits of the particular amendments, one awaits the Minister's response before forming a judgment. I believe that the object of the amendments would in fact be achieved in the way in which the issues are hammered out on the anvil of adjudication, if necessary. I very much hope that the Minister and his colleagues will have had that conversion, as will their officials, to the new culture that will make such disputes much rarer than would otherwise be the case.
Lord Lucas: My Lords, does the noble Lord agree that it was his amendment that placed subsection (4) in the Bill and that all my amendment seeks to do is to change, in a small way, the scope and emphasis of that amendment? I do not see that that qualifies for all the criticisms that the noble Lord has just made of me.
Lord Lester of Herne Hill: My Lords, I agree. I have not criticised the amendments; indeed, I hope that I made that plain. I sought to place both amendments into a context and to repeat the argument that my noble friend Lord Goodhart put forward on the previous occasion; namely, that the changing of a constitutional framework transforms this into a Freedom of Information Bill of which we should all be proud.
As shall not be speaking again, perhaps I may also add my thanks to the noble and learned Lord, Lord Falconer, and his colleagues for having been open-minded enough to accept these changes.
3.45 p.m.
Lord Winston: My Lords, I rise tentatively to support my noble friend's amendment. Perhaps I may ask for a little clarification from my noble and learned friend the Minister. The noble Lord, Lord Lucas, has raised quite an important issue. Certainly to publish part, but not all, of a scientific paper can be very seriously misleading. There is an issue here, especially as regards scientists, about not publishing the discussion on data that is generated during scientific investigation. The best way for me to illustrate the
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dangers involved is to put forward an argument relating to a particular case that happened a few years ago.
Noble Lords will remember the publication on Dolly the sheep regarding the cloning of this animal in Scotland. Because the paper in which that information was published did not allow for discussion, the consequence was extraordinary and adverse publicity for what was a very important scientific achievement—publicity that has clouded a whole area of reproduction and developmental medicine. Had such discussion been included, it would have been very clear from the scientists' views based on their best evidence that the cloning of a human being—that is to say, reproductive cloning—would have been quite impossible. If the Government do not publish the whole data and the intention is to fillet papers, it seems to me that there may be a serious issue here that I hope my noble and learned friend can address in his response.
My other concern relates to the fact that much scientific research is carried out on the basis of funding that usually comes from one of our research councils, such as the Medical Research Council, or one of the other funding councils. It is often linked—it may or may not be through direct government funding—with other independent peer review funding because most scientists work with more than one single budget. Such grants are given as part of the public purse, not least because there is a public interest in devolving these grants to the individual scientist. Therefore, there is a serious question about withholding that information, except in the most extreme circumstances. It seems to me that that would clearly not be within the spirit of this legislation.
Lord Brennan: My Lords, I have asked the forgiveness of my noble friend Lady Whitaker for not being present in the Chamber to hear her opening remarks, because I was unavoidably delayed. I also apologise to the House. My noble friend has given me a broad outline of what she said. I rise to express my support for the amendment, which I believe illustrates an issue of great importance at the close of this freedom of information debate; namely, the way in which the Government will treat the scientific and technical data (and the analysis of it) that they possess.
On 20th July of this year the Chief Scientific Officer to the Government, speaking on behalf of his colleagues, issued a statement in which he declared it to be their wish that their scientific material should be disclosed to the public. There is always the proviso of a very good reason why not, but the general intent was that the public should know. On 26th October the Minister of Agriculture, Fisheries and Food in the other place said on some half dozen occasions that he wanted the public to know about the scientific material on BSE.
I am sure the House will agree that those two approaches were entirely commendable. They were not afflicted by any legal concerns. They were made without having to take into account the existence or purpose of a Freedom of Information Bill and their

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intent was obvious: within reason, what the Government know the public should know. In our society we are reaching a period of great complexity. The example of the BSE tragedy has horrified us all. The public debate on GM crops persists. The debate yet to come on human cell research will produce the most profound concerns for us all. In any of those debates or concerns do we not want the public to know what they ought to know in order to make their own decisions?
From what my noble friend Lord Winston said, I have the impression that what the Chief Scientific Officer said represents the views of science. I am sure scientists feel that they serve the community and that if they give information to the Government it is given for the benefit of the community. In time to come we shall have a triangle of power in these areas: government, commerce and the world of science and medicine. All three are not above us; they serve us. I can think of no cogent reason why scientific and technical data should not be in the public arena.
At the end of this debate it would be appropriate for my noble and learned friend the Minister to reassure the public that this Bill does not constitute some new barrier between them and the Government with regard to information, but is rather a new and effective bridge to ensure that they receive the information. Whatever the Government's view on the amendment, I hope that the Minister will take the opportunity to tell the world outside, "Never mind the Bill; never mind government interest, commercial interest or the amour propre of science, what we know you will know unless there is an extremely convincing reason why you should not".
Lord Mackay of Ardbrecknish: My Lords, this has been an interesting short debate. It is one in which those of us who have struggled with the Bill during its various stages have been involved before; namely, the question of the data, facts and analysis that are presented to government Ministers day after day in order to help them reach decisions. I believe that no one in the committee or the House would wish to see made public the mechanics of how Ministers reach their decisions and the papers that flow between them and their civil servants. Sometimes they are made public to the embarrassment of at least some of the parties concerned. However, it would not help the way government reach their decisions for everyone to know that they might read about the issues before them, the options they had and the way they debated them in the newspapers the next morning. No one has argued to the contrary.
However, we are arguing about much of the background material—sometimes that is vital material—on which the Government make their decisions. The noble Baroness, Lady Whitaker, has done us a favour in coming back yet again with another variation of the amendment to try to make it more acceptable to her noble and learned friend the Minister. I am not sure what the noble and learned Lord will say in response.
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I called the noble Lord, Lord Goodhart, the shadow Minister. Now that the noble Lord, Lord Winston, has appeared in the debate, I shall change that title. We have heard from the surrogate Minister. They come in twins which I gather is one of the problems with fertility treatment. We have heard a definition. I say to the noble Lord, Lord Lester, that I am not entirely satisfied with what he suggested; namely that the courts will decide what the measure means. I prefer Parliament to decide what it means and say what it means, or even the Government to decide what it means and say what it means. Then we would be clear. The people, through Parliament, would make it clear what they want to happen in this regard.
Lord Lester of Herne Hill: My Lords, I am grateful to the noble Lord for giving way. I thought that under our constitution it was Parliament that made the law and the courts in their independent capacity that interpreted and applied the law. It is not the function of Parliament to interpret the law; it is the function of the courts to do so.
Lord Mackay of Ardbrecknish: My Lords, I shall not try to cross legal swords with the noble Lord. The courts apply the law. They interpret it if they have to, but we ought to make the law crystal clear when we pass it. The less interpretation the courts have to do, the better. I see that the noble Lord assents, so at least we agree on that.
The problem here is the one on which the noble Lords, Lord Winston and Lord Brennan, put their fingers. As someone who a long time ago studied science at a rather lower level than the noble Lord, Lord Winston, I know that scientific data can be almost meaningless, at least to everyone bar a small number of experts. It is the analysis of the data that is hugely important. The analysis of the data is important for Ministers who tend not to read the data but the analysis of the data. Occasionally they will study the data to see whether they can work out whether the analysis is correct. Great scientists do not do that; they read the data and then make the analysis. However, there are few scientists in government. That is perhaps a pity. Therefore the analysis is of vital importance. The amendment of the noble Baroness, Lady Whitaker, to which I have added my name, would improve the position.
I am told that the existing open government code of practice is inadequate. As I have made clear, we now agree that an Act is a better way to proceed. The existing open government code of practice states that,
"the facts and analysis of the facts which the Government considers relevant and important in framing major policy proposals and decisions",
should be proactively published. Unless we are clear that not only the facts but also the analysis of the facts will be published as a result of the provisions of the Bill, I suggest to the noble and learned Lord that that will be a step backwards which I am sure he does not intend. I look forward to hearing him accept his noble friend's amendment. If he cannot do that—it is sometimes difficult for government Ministers to accept

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amendments—I hope that he will at least put on record the simple proposition that it is not just the facts that should be published (because that expression can be narrowly interpreted) but also the analysis of the facts.
When the information is made public and people, and especially newspapers, can study the analysis of the facts, I hope that the debates which take place on the important issues which science will present to us will at least be based on an informed position on the data and that we shall not just be presented with the data and allow every Tom, Dick and Harry to peddle their prejudices. The point of the noble Lord, Lord Winston, about Dolly the sheep was well made. I hope that the Minister will satisfy those noble Lords who have taken part in the debate with regard to the current position of the Bill on that matter.
4 p.m.
Lord Falconer of Thoroton: My Lords, in this short debate noble Lords have gone over two pieces of ground that we have often gone over during the passage of the Bill. The structure of the Bill now involves exemptions but also, under Clause 2, provisions whereby the public authority should disclose the information unless there is a public interest in maintaining the exemption.
I do not intend to go over those debates which we have already had on a number of occasions save to make one point in response to the points made by the noble and learned Lord, Lord Archer of Sandwell. I hope that I have made clear on previous occasions— if I have not done so, I make it clear on this occasion— that, in the case of a piece of information to which an exemption applies but which also falls under the provisions of Clause 2, it is necessary for the public authority to consider in each case whether or not the Clause 2 discretion requires disclosure of the document or the information. It has to be considered on a case-by-case basis.
The second issue is of real concern to noble Lords and the Government: the publication of factual and scientific material and the analysis of scientific material. The noble Lord, Lord Lucas, has returned to the point again and again, in particular by reference to the BSE affair. In this House and in government we are all aware of the condemnation in the report of the noble and learned Lord, Lord Phillips, of the culture of secrecy. That is something we no longer wish to see exist.
The Bill has an important part to play but it is worth emphasising that the remarks by the Chief Scientific Officer and the Minister of Agriculture, Fisheries and Food, which the noble Lord, Lord Brennan, mentioned, referred not to the Freedom of Information Bill but to a policy adopted by the Chief Scientific Officer and the relevant Minister which does not depend in any way on the terms of this Bill. I wish to make that clear.
I turn to the specifics of the two amendments. Amendment No. 3 was moved by the noble Baroness, Lady Whitaker. I believe that the Government have already made provision for what I understand to be the
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concerns underlying the noble Baroness's amendment. It is difficult to see what information would come within the terms "scientific, medical or technical" which would not be covered by the provisions for factual and statistical information already in the Bill. Statistical information in relation to a government decision already taken has been taken out of the harm test in Clause 35 and is now subjected to the prejudice test in Clause 36. There is also a significant steer for public authorities towards the particular public interest which exists in the disclosure of factual information which has been used to provide an informed background to decision taking.
In moving the amendment, the noble Baroness was supported by the noble Lord, Lord Lucas, and my noble friend Lord Winston. They mentioned that the amendment does not extend to cover advice on policy given by government scientists and that it is limited to the scientists' opinion on the significance of the data. This is the analysis point. I believe that it is impossible satisfactorily to distinguish pure analysis of information from advice which is to be given based on that information. The noble Lord, Lord Mackay of Ardbrecknish, made that point. For example, analysis of data could relate to collation of statistical data or the expression of such data in other ways in order that it be more easily understood. The Government believe that it would be exceedingly difficult for a public authority to make a case for withholding this type of information. However, it is important to have protection for the provision of advice to Ministers in order that good governance be maintained. But the kinds of analysis to which I and other noble Lords have referred would, I think, be impossible to withhold in the vast majority of cases.
The noble Baroness also made reference to the Government being able to withhold information if they felt that there was a public interest in all ingredients of their internal discussion remaining confidential in order to allow the free and frank provision of advice. The Government believe that there is a public interest in keeping certain parts of internal discussions confidential for this reason, as reflected in the existence of exemptions in the Bill. However, balancing the public interest is a completely separate exercise to be conducted if an exemption applies. It is this exercise which will ensure that the legitimate concerns of the noble Baroness are met and that, where it is in the public interest, such information as is covered by her amendment will be released. I hope that these remarks reassure the noble Baroness and others who have spoken on this important issue.
With regard to Amendment No. 4, the noble Lord, Lord Lucas, expressed the same concerns as those mentioned by the noble Baroness, Lady Whitaker. I hope that I have dealt with them adequately in my remarks.
Before I sit down—I suspect that this may be the last opportunity to do so—perhaps I may pay a special tribute to the noble and learned Lord, Lord Archer of Sandwell, and the noble Baroness, Lady Whitaker, who have made substantial and influential

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contributions to the debates in the House during proceedings on the Bill and have contributed significantly to the changes which have been made.
Baroness Whitaker: My Lords, this has been an important debate with distinguished contributions from lawyers and others. My noble friend Lord Winston made significant points on matters which go to the heart of the Bill. I thank all who took part. I thank the Minister for his detailed explanation and, as others have said, the courtesy with which he has dealt with our misgivings.
His explanation will be extremely helpful with regard to the interpretation of the Bill by the public. I hope that the noble and learned Lord will support the interpretation that he furnished today with guidance to the public which makes crystal clear the kind of access they have. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 4 not moved.]
Clause 36 [Prejudice to effective conduct of public affairs]:
Viscount Colville of Culross Viscount Colville of Culross moved Amendment No. 5:
Page 22, leave out line 21 and insert—
("any action or decision for the effective conduct of public affairs which the department, Assembly or authority proposes at some future time to take in any case where—

(i) the information is not exempt by virtue of section 22; and

(ii) it is reasonable in all the circumstances for the information to be withheld at the time when the request for it is made").

The noble Viscount said: My Lords, I thought that I had told everyone that I did not want Amendments Nos. 5 and 6 grouped. I hope that I may be forgiven if I deal with them separately because they are separate points.
Noble Lords will recall that as a result of the decision taken quite late in the evening on Tuesday 14th November Clause 36 still provides for the reasonable opinion of a qualified person. We have discussed the provision under Clause 36(2)(c). The noble Lord, Lord Mackay, has joined his name to the amendment. I believe that he also is not clear exactly what we are talking about. It would be easy for the reasonable opinion of a qualified person to take a quite wide view of what would be likely to prejudice the effective conduct of public affairs. Not all of the qualified persons will be of the calibre of my noble friend Lord Williamson of Horton who conceded that, had he still been in his previous office, he would have been likely to fall into that category. I believe that others may not have such a grasp of the overall situation and their duties under this legislation.
The difficulty about Clause 36(2)(c) is its breadth. It is worth remembering how this matter originally came about. In the draft Bill before the Select Committee presided over by the noble and learned Lord, Lord Archer, of which I was a member, this matter was part
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of the decision-making and policy formulation issue which is now dealt with in Clause 35 of the Bill. Since then it has been sub-divided. We have just discussed Clause 35. Clause 36 goes further than anything previously conceived of in Clause 38 of the draft Bill.
The explanatory memorandum that accompanied that Bill said:
"Subsection (5) defines a qualified person. For a government department in the charge of a Minister it is a Minister of the Crown. For other government departments it is to be the person in charge of that department. In relation to the National Assembly for Wales it means the Assembly First Secretary. For other public authorities it is to be a Minister of the Crown unless the authority or other person is authorised by a Minister of the Crown".
That is not how it has worked out in the Bill. There is now a much wider range of people either specifically named or able to be nominated by Ministers under the machinery in Clause 36. What will they say is exempt by virtue of subsection (2)(c)?
The noble and learned Lord, Lord Falconer, has been pressed continually about that and has given only two examples. One was the premature publication of exam questions. The noble Lord, Lord Norton of Louth, dealt with that thoroughly. The Minister's other example was the premature disclosure of a local planning authority's proposal to list a building, with the implied invitation that the owner would need to hurry up and demolish it before the listing took place. If that is all that the provision is supposed to cover, my amendment would deal with the problem satisfactorily. It would provide an exemption for such legitimate activities of the public authority concerned that would be published in due course but ought not to be published yet, because premature publication would cause damage.
Given the Minister's arguments so far, I do not understand how he can resist the amendment. He cannot deny that I have simply translated into general terms the sorts of situation covered by his examples. If he has in mind a wider set of circumstances that ought to be covered by paragraph (c), this is our last opportunity to hear them. If that is the case, it might be best if the Government accept the amendment and move amendments to it in another place to deal with whatever they propose to cover.
If the Minister continues to rely on the examples that he has given, it would be wise to constrict the public authority in preventing the publication of information by providing greater clarity in the Bill, not leaving it to the courts. The noble Lord, Lord Lester, has now left, so he cannot tell me anything more about that. We should make clear in the Bill the exemption that we are providing for the benefit of the public authority. The situation is unsatisfactory. The people in charge of the decision will have wide jurisdiction to prevent the public finding out what they want to know. The amendment would help to clarify the situation and to put it in the context that the Minister referred to. I beg to move.
4.15 p.m.
Lord Lucas: My Lords, I entirely support the noble Viscount, Lord Colville of Culross. We had an

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unsatisfactory answer from the Minister on Report. The noble Viscount's interpretation of the clause is entirely reasonable. The wide terms of subsections (1)(a) and, in particular, (1)(b), mean that an exemption is available for almost any information held by almost any public authority at the whim of one of the named individuals. There is no limitation on them and no effective control of them.
The Minister tried to put a different construction on the problem on Report. He said the clause merely provided a helpful restriction on the number of people who could operate the clause, putting the power in the hands of a relatively small number of individuals who would all be upstanding and responsible. He said that the clause would be entirely helpful to the cause of freedom of information.
The crucial distinction between those two views is the position that the information commissioner finds herself in when presented with an appeal against a refusal of access to information as a result of the exemption. It is stated that under the clause the qualified person can determine whether prejudice exists. That is fine, but can they also determine the quantum of that prejudice? Does the information commissioner have to accept that determination? If the qualified person says that the information would cause such prejudice that it should never be released, will the information commissioner be bound by that view, or can she substitute her own view? If she is entirely free to substitute her own view, the clause could do only a relatively limited amount of harm. If, on the other hand, the amount of prejudice is to be determined by the vast array of qualified persons, the clause could do extreme harm to the cause of freedom of information. We got no answer from the Minister on Report. I hope that we shall get one now.
Lord Mackay of Ardbrecknish: My Lords, as the noble Viscount, Lord Colville of Culross, said, the examples given by the Minister on Report almost brought noble Lords to the edge of their seats with laughter, particularly the need for a qualified person to be able to prevent potential examination questions being revealed. My noble friend Lord Norton of Louth, who has probably made up more potential examination questions than anyone else in the House, dealt with that. That situation clearly does not need such protection.
We remain worried about the scope to be given to the reasonable opinion of a qualified person. The noble Viscount has done us a favour by coming forward with a modest limitation on that scope. I look forward to the Minister's answer. Perhaps he will give us some better examples this time.
Lord Falconer of Thoroton: My Lords, I am grateful to the noble Viscount for raising this important issue. I accept that we have degrouped Amendments Nos. 5 and 6. I shall deal only with Amendment No. 5 at the moment. The Bill provides an exemption for information that would,
"prejudice, or would be likely otherwise to prejudice, the effective conduct of public affairs".
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The amendment would exempt information that would,
"prejudice, or would be likely otherwise to prejudice, any action or decision for the effective conduct of public affairs which the department, Assembly or authority proposes at some future time to take in any case where

(a) the information is not exempt by virtue of section 22; and

(b) it is reasonable in all the circumstances for the information to be withheld at the time when the request for it is made".

The difference between the existing draft and that draft is quite difficult to detect. It does not for one moment, for example, touch the definition of the qualified person, the number of qualified persons or the role that they perform in determining where the balance lies.
The noble Viscount justifies his proposed amendment by saying that it would cover the examples given. It would, so long as the noble Viscount knows what view the information commissioner or the courts would take about the phrase,
"it is reasonable in all the circumstances for the information to be withheld".
In parenthesis, I refer to what the noble Lord, Lord Mackay of Ardbrecknish, said. If one wants uncertainty about what will happen in the future, one should insert a phrase such as,
"it is reasonable in all the circumstances for the information to be withheld",
because absolutely no guidance is given as to how that would be effected.
However, the clause is not intended simply to deal with the two examples that have been given. As was said on the previous occasion that we discussed this matter, the clause has been inserted because 50,000 public authorities are covered by the Bill. From where we sit at the moment, it is impossible to determine the precise circumstances in which it might be appropriate for information to be withheld because in the future that would prejudice the effective conduct of public affairs by a public authority. If there is a case, first, a named individual must say that such a prejudice exists. Then, under Clause 2, disclosure of that information takes place unless the relevant public authority can satisfy the information commissioner that there is a good reason for not disclosing.
The noble Lord, Lord Lucas, asks whether the information commissioner can weigh the quantum of the prejudice. Of course, she can. The information commissioner will have to do so because she is deciding where the weightier balance lies when it comes to Clause 2.
Lord Lucas: My Lords, I entirely understand that that is the process through which the information commissioner goes and that the commissioner will make her own judgment of the weight of public interest in disclosure. However, I am anxious to determine that the judgment of the weight of prejudice will be hers and not that of the authorised person, which is the other side of the balance.
Lord Falconer of Thoroton: Yes, my Lords. I confirm that that is the position. That is the effect of

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our present draft. With the greatest respect to the noble Viscount, the effect of his draft is more complicated, more open, more wide-ranging, less restricted and, in my respectful submission, would not deal with the problems that he identified in moving the amendment. Therefore, in the light of what I have said and in the light of the reassurances that I have given in relation to a number of points, I suggest that the noble Viscount does not move Amendment No. 5.
Viscount Colville of Culross: My Lords, I have moved Amendment No. 5, so I am afraid that we have to deal with it. I shall now respond to the noble and learned Lord, and I am grateful to other noble Lords who have taken part.
I am afraid that I do not understand the noble and learned Lord when he criticises the test that I have provided. As has now been clearly established—I am grateful to the noble Lord, Lord Lucas, for helping in this matter—in every one of those cases the information commissioner will have to ensure that the prejudice, which of course will have to be disclosed to the commissioner, is weighed against the public interest which is relied upon as part of the exercise in non-disclosure. She will have both parts of the equation in front of her.
Why the noble and learned Lord considers that his draft in paragraph (c) is clearer, better defined, more restricted and more ordered in every possible way than what I have put forward is beyond my comprehension. I do not want to prolong this debate. I understand that the noble and learned Lord does not intend to accept anything. Therefore, perhaps I may suggest to him that some device is produced whereby the information commissioner gives guidance to those 50,000 qualified persons who are to take the decisions.
Such guidance will not be provided under Clause 49 in the annual report or in any special report given to Parliament. It will come in case law. That will be difficult, and I do not understand how it will be achieved because the circumstances of individual cases may well be such that the details on the basis of which the information commissioner has reached her decision cannot be publicised. Nevertheless, some guidance will have to be given about the lines that the information commissioner will draw as to where the qualified person is allowed to exercise the powers that at present are set out in paragraph (c).
I am sure that the noble and learned Lord is listening to what I am saying. I hope that in a moment when I move my next amendment he may have the opportunity to respond to that matter. I believe that guidance in this field will be very important, not only to qualified persons but also to members of the public who seek information. At least they will then gradually build up some knowledge of how the system works and of what the information commissioner is likely to do in relation to the balancing act that will be her copious duty in future.
I am very disappointed that the noble and learned Lord gives no further examples, although I had not expected him to give any. I am afraid that it is clear
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from reading and listening to these debates that we shall never achieve any clarity in this matter. As I cannot do anything about it, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
4.30 p.m.
Viscount Colville of Culross Viscount Colville of Culross moved Amendment No. 6:
Page 22, line 21, at end insert—
("(For the purposes of paragraph (c) of subsection (2), the effective conduct of public affairs is not to be regarded as prejudiced or likely to be prejudiced insofar as disclosure of the information would, or would be likely to, result in any member of the public seeking, by lawful means, to influence the public authority in relation to any action or decision which that authority has the power to take.").
The noble Viscount said: My Lords, this amendment covers another aspect of the same point. What is,
"the effective conduct of public affairs",
in the minds of 50,000 public authorities? One of the ways in which one can effectively conduct public affairs is by preventing people discovering what one is working on until it is too late for them to make any form of objection. I am quite certain that that is not what the Government intend; indeed, it is the opposite of what they intend. Nevertheless, that will not necessarily be the view of all public authorities.
I have in mind an incident in which I was involved not long ago in which a planning decision was being appealed. The planning authority was required under statute to publish—and it did publish—all the material that it had received in the form of advice from officers and others which would lead it to its decision. However, it disclosed that other public authorities which had been consulted, as is required under the procedure, had given a vague and dismissive reply. There was no means of discovering what those other public authorities really thought. The vague and dismissive replies were not open to further investigation. There was no means of extracting information relating to what they had considered, what they had rejected and why they had formed the view that they had. I assume that that was what they considered to be the effective conduct of public affairs. I do not believe that that is the right approach, and I believe that the noble and learned Lord, Lord Falconer, will tell me that I am correct in that.
However, let us look at the practicalities of the matter. This subject will arise not only in relation to affairs of state under Clause 35 and the issues which we were discussing a few moments ago; it will arise also in relation to all sorts of small decisions which affect individual members of the public as to their health, their environment, their children's education and all sorts of extremely important matters to them as persons and as families. The decisions do not necessarily hang around very long before they are taken.
I want the noble and learned Lord to tell me how the effective conduct of public affairs and disclosure of information about it fit into the timetable of the Bill.

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The timetable means that a person has to discover that a decision as to the effective conduct of public affairs will be taken by a public authority. Having done so, the request is made and, under Clause 10(1), there are 20 days in which the initial result is to be provided to him, although that can be extended. But that is only the first step.
The second step—and this is Clause 10(3)—is that when it comes to the issue about whether or not there is prejudice, which is where the Liberal Democrat amendments to Clause 3 bite, the period of time during which the public authority shall decide whether or not there is, in its view, prejudice is indefinite. There is no timetable at all and your Lordships have only to look at Clause 3 to see that.
Eventually the public authority may say that the balance has come down against disclosure. So the person who is anxious to know about the details of the matter says, "I will go to the information commissioner" but, of course, he cannot do that because the first thing that he must do is to go through the public authority's complaints procedure. That is set down under Clause 45(2)(e). Under the procedures organised by the public authority for the purposes of this Bill, there must be a complaints procedure. It is only when that has been completed that the information commissioner can start to look into the matter, because she is previously precluded from doing so by Clause 50(2)(a).
How long will that take? Let us suppose that the local authority or the other public authority is dealing with something which is comparatively urgent but, nevertheless, vital to the inhabitants of the area or people otherwise concerned. Will the Bill really give them the opportunity to find out in time what it is that is the basic material on which the decision has been taken? I suggest to your Lordships that it is not.
Therefore, I suggest that we need something in the form which I have tabled as Amendment No. 6 on the Marshalled List. That would make it possible for the public to try to influence the public authority, by lawful means of course, in relation to the decision that is to be taken. By implication, that means that the information must be made available in time to do so.
I am not sure that this matter has previously been discussed and it is a late stage of the Bill at which to do it. Nevertheless, it is implicit in the way in which paragraph (c) is presently phrased that there is really no recourse for the member of the public who wants information and wants it urgently, because the rest of the machinery of the Bill will provide indeterminate delay and it will not be available in time.
I hope that the noble and learned Lord can say something about that because not only will it be of assistance to those who are listening to this debate; it will be of assistance, because it will be in the Official Report, for those who wish to seek information; it will be of assistance to those who are in charge of public authorities and have to make decisions under paragraph (c); and I should have thought that it would be of great assistance to the information commissioner at the early stages, before she has established a code or
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a jurisprudence of the way in which she will deal with these matters. Therefore, this needs to be addressed by the Government and I look forward to hearing what the noble and learned Lord has to say about it. I beg to move.
Lord Falconer of Thoroton: My Lords, the point which the noble Viscount makes is important and it is the first time that it has been raised in the course of our debates. It does not apply only to Clause 36. There is nothing specific to do with that clause. It simply makes the point: what happens when the information is needed urgently? That is the point which the amendment raises.
The position under the Bill is that a public authority must inform the applicant within 20 working days if it is not going to comply with the request. At the same time, if the public interest test applies by virtue of Clause 2, then the public authority must inform the applicant of its determination under that clause or it must indicate when it is going to determine that beyond the 20 days; and if the applicant disagrees with that length of time, the applicant can go to the information commissioner and complain about the length of time.
Obviously, under the Bill there must be a period of time within which the public authority has time to comply with the request. As regards appeals procedures, the noble Viscount is right to say that domestic complaints procedures must be exhausted first—for example, local authority complaints procedures—when there has not been a disclosure. Whether or not there is a provision in relation to those for urgency will depend upon the individual procedure.
The information commissioner's code of practice will say that applications should be dealt with promptly and, if there is good reason why it should be dealt with urgently, no doubt that will be taken into account in determining how quickly to deal with the individual complaint or appeal against a particular ruling by a public authority.
That is as far as I can take it. Inevitably, there must be some period of time within which both public authorities and information commissioners are allowed to deal with the applications. Of course, if the applicant has a particular reason for needing the information urgently, no doubt that will be taken into account when the application is being considered.
Viscount Colville of Culross: My Lords, I do not think that it will because, although the noble and learned Lord sets out what is in Clause 10 and says that there must be some test of urgency, there is still the stage which he did not mention at all—the complaints procedure under Clause 45. That must be gone through too and that is in the hands of the public authority itself. There is no timetable in relation to that and it is on the face of the statute that it is only after that process has been exhausted that the information commissioner can come into the picture.

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There is no guarantee that the person who seeks the information will have been able to overcome all those delays in order to obtain the information before the public authority makes the decision. There is no appeal to the commissioner until all the complaints procedures have been completed. Therefore, the noble and learned Lord has disclosed a very substantial gap in the way in which this Bill will be practicable from the point of view of ordinary people.
Again, it is no use my pressing this matter at this stage, particularly as it is the first time that it has been raised. But I trust that the Government and the information commissioner will apply themselves to the problem which I have tried to adumbrate; in other words, when an urgent decision is required and the procedures need to be very substantially curtailed in order that a decision can be taken upon the matter in time, before the decision is finally reached by the public authority.
Lord Falconer of Thoroton: My Lords, I apologise for interrupting the noble Viscount but what I say will provide him with some assistance. The commissioner will be able to hear complaints before the exhaustion of the authority's internal appeals procedure. Urgent cases would fall into that category. But that obviously does not deal with cases in which the 20-day period has elapsed.
Viscount Colville of Culross: My Lords, I am extremely grateful to the Minister for that clarification. However, it does not appear to me to comply with Clause 50(2)(a), which states:
"On receiving an application under this section, the Commissioner shall make a decision unless it appears to him"—
which, of course, means "her"—
"that the complainant has not exhausted any complaints procedure".
It appears to me that, if the complaints procedure has not been exhausted, the commissioner will be denied the opportunity to make a decision.
Lord Falconer of Thoroton: My Lords, perhaps I can assist the noble Viscount in relation to that. If he reads the remainder of Clause 50(2)(a), he will note,
"that the complainant has not exhausted any complaints procedure which is provided by the public authority in conformity with the code of practice under section 45".
That is a reference to the commissioner's code of practice, which will specify the circumstances in which the local or domestic appeals procedure must be complied with before the commissioner's role comes into play.
Viscount Colville of Culross: My Lords, I understand that point, for which I thank the Minister. I do not invite him to say anything further at the moment, but I ask him to listen to my next point. The commissioner would need a code of practice that would enable her to take on board appeals against refusals to disclose in cases of urgency, which have to bypass the complaints procedure. I know that that will be laid down in her
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own code of practice but, nevertheless, the code of practice will then be applicable to the public authorities, which will have to set up a procedure. She will have to ensure that, where an applicant can make out a case for an urgent decision, the whole process of the complaints procedure would not need to be gone through before her jurisdiction started. I shall leave it at that. The Minister nods his head—I hope to me. I hope that he will ensure that some such provision is included in the code of practice so that public authorities can be required to make timely decisions, or the commissioner allowed to make decisions on their behalf.
In the circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 45 [Issue of code of practice by Secretary of State]:
[Amendment No. 7 not moved.]
Clause 53 [Exception from duty to comply with decision notice or enforcement notice]:
Lord Falconer of Thoroton Lord Falconer of Thoroton moved Amendment No. 8:
Page 31, line 26, leave out from ("information") to ("that") in line 27 and insert ("which falls within any provision of Part II stating").
On Question, amendment agreed to.
4.45 p.m.
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 9:
Page 31, line 36, at end insert—
("() Where the accountable person gives a certificate to the Commissioner under subsection (2), the Secretary of State shall as soon as is practicable thereafter arrange for details of the certificate to be drawn to the attention of each House of Parliament.
() In any case where a certificate under subsection (2) relates to a decision notice or enforcement notice which has been served on a Northern Ireland department or any Northern Ireland public authority, the accountable person shall as soon as is practicable thereafter arrange for details of the certificate to be drawn to the attention of the Northern Ireland Assembly.
() In any case where a certificate under subsection (2) relates to a decision notice or enforcement notice which has been served on the National Assembly for Wales or any Welsh public authority, the accountable person shall as soon as is practicable thereafter arrange for details of the certificate to be drawn to the attention of the National Assembly for Wales.").
The noble Lord said: My Lords, I can deal briefly with this group of amendments, two of which stand in my name and one in the name of my noble friend Lord Norton of Louth. Before doing so, I thank the Minister for the courteous way in which he has conducted this debate. I also thank other noble Lords, learned and not learned—only because they are not office-holders or have not attended the legal teach-in which we non-lawyers have undergone as we have proceeded with this Bill. I now understand that the most important thing in the law is a balance of "this" against "that".
These amendments deal with the veto that a government Minister is allowed to have on the publication of information. This is a kind of nuclear option for the Government. When all else has failed and they do not believe that it is in the public interest to divulge this information, they are allowed to take the steps outlined in the clause and impose a veto.
We had an interesting debate on the last occasion when I suggested that Parliament should be informed of the use of the veto. I shall not quote the noble and learned Lord extensively. However, I am sure that he will agree that he made much of the fact that Ministers could not abuse the veto system because, if they did, Parliament would soon become irritated and would call them to account. I identified a slight problem. I suggested that there was no real means by which Parliament could know that the veto had been used unless they waited for publication in the commissioner's annual report of the use of the veto—perhaps 10 or 11 months following the event. That would not be very satisfactory.
I proposed what I freely admit was a fairly elaborate method of reporting to the House and having the House debate the issue before the Minister was allowed to comfortably tuck away the veto in his back pocket; perhaps that was a bit too much. But I have now considered how we can achieve a situation in which the Minister would have to inform Parliament. I have two options, one of which is more elaborate than the other, and my noble friend Lord Norton of Louth has another option. I would be satisfied with the usual inspired question that is asked in the other place, to which the Minister is quite keen to give an answer. On any reading of Hansard, your Lordships will see that inspiration for many of these questions usually comes from the Whips. I would be quite satisfied with that. That is a legitimate, sensible and open way of keeping Parliament informed. While one of my amendments does not specify it, that method of informing Parliament would be satisfactory. I very much hope that the Minister will be able to give me some words of comfort. In addition, so that I can be upsides with noble Lords on the Liberal Democrat Benches and have some amendment accepted in this piece of legislation, I hope that he will feel able to accept one of the variations in this menu. I beg to move.
Lord Norton of Louth: My Lords, I rise to speak to Amendment No. 11, which is grouped with the amendments tabled by my noble friend. His represent the modest option; mine represents the radical option. I thank the noble and learned Lord in advance for what I am sure will be a constructive response to my amendment. In an ideal world, I would be thanking him in advance for accepting it.
In Committee and on Report, the noble and learned Lord stressed that any Minister issuing a certificate under Clause 53 would be accountable to Parliament for that action. He said that the Bill provides that decisions must be transparent and that a Minister signing a certificate must give reasons for that decision. There is no dispute about the importance of
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ministerial accountability. The disagreement relates to how effective accountability can be achieved. My amendment is designed to ensure that Parliament is provided with a means of achieving that desirable end. It requires that a certificate issued by a Minister has to be confirmed by both Houses; it provides for a Joint Committee to have sight, on a confidential basis, of the material that is the subject of the veto. The amendment thus ensures that Ministers cannot avoid parliamentary scrutiny. Scrutiny will take place. Ministers will have to answer to both Houses. The amendment also ensures that Ministers cannot fall back on some broad defence, parliamentarians being unsure as to whether or not that defence is justified. The House would be able to have the advice of a Joint Committee as to whether or not the defence was justified.
In Committee, I proposed that the relevant departmental Select Committee of the House of Commons—or, if the certificate covered an issue of national security, the Intelligence and Security Committee—should have confidential sight of the material. On reflection, I have decided that a Joint Committee of both Houses would be appropriate. However, if the certificate relates to an issue of national security, which, of course, is a distinct possibility, I suggest that it should also be referred to the Intelligence and Security Committee.
Making use of a Joint Committee would be feasible and appropriate. It would be feasible because the issue of a certificate would be rare. I take the Government at their word on that. Both Houses would, therefore, rarely be called upon to nominate members to serve on such a committee. It would be appropriate because both Houses would be called upon to confirm the certificate, and it would allow both Houses to appoint senior members to serve on the committee. The Intelligence and Security Committee, which is a statutory body, comprises senior Privy Counsellors. I envisage the Joint Committee comprising a similar membership. It would thus be a body of high standing and integrity.
I made the case for strengthening parliamentary accountability on Report. I do not intend to repeat what I said then; rather, I propose to explain briefly why the Minister's response on that occasion was not persuasive, and hence why I have returned to the issue at Third Reading. On Report the Minister advanced the argument that existing arrangements were satisfactory and that my proposal had two principal defects.
The Minister's justification for the Bill's provisions was that the commissioner, who would have had an opportunity to see the relevant information could,
"report any shortcomings in the decision-making procedure to Parliament".—[Official Report, 14/10/00; col. 259.]
Doubtless the commissioner could. However, I am not concerned here with shortcomings of the decision-making procedure. I am concerned with the decision itself. The Minister argued that my proposal was deficient because it would not add any greater

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transparency to the process and because the action of issuing a certificate was an executive and not a legislative power.
I would argue that my proposal should be seen in terms of legitimacy. Under the clause as it stands, Ministers will be judge and jury in their own cause. There will always be the suspicion—it may be groundless, but it will exist—that Ministers will exercise the veto to avoid embarrassing material being put into the public domain. My proposal provides for Parliament, enjoying a legitimacy of its own, to confirm that the Minister's reasons for exercising the veto are reasonable.
I would also contend that my proposal does aid transparency. Knowing that they will be answerable to Parliament for their actions—something they cannot avoid—is likely to ensure that Ministers provide as full a justification as possible; and, indeed, that they will not embark on a course of action unless they are sure that they can justify it to Parliament.
As regards the argument for it being an executive power, I understand the case the Minister advances but I do not think that it is conclusive. Parliament confers powers upon Ministers, but variously makes the exercise of those powers subject to parliamentary approval. The ministerial veto here is a power conferred by Parliament. We are not dealing here with executive actions derived from the prerogative.
I therefore do not find the Minister's arguments persuasive. I am greatly tempted to tell the noble and learned Lord that I have applied a balancing test, weighing the needs of the executive against the imperative of parliamentary scrutiny. It is really no contest. Government must be accountable to Parliament.
In this clause we are giving an important power to Government without balancing it with an effective provision for parliamentary scrutiny. My amendment is designed to provide for that scrutiny. I hope that Members of this House will always act to maintain effective scrutiny of the executive.
Lord Falconer of Thoroton: My Lords, we agree on the need for proper accountability in relation to Parliament for the giving of a certificate under Clause 52 which has been described as the ministerial veto. Amendments Nos. 9 and 10 are alternative methods of directly notifying Parliament of that. We have considerable sympathy with the spirit behind the amendments.
Amendment No. 9 is vague because it states that the relevant accountable person should draw the attention of the relevant body to the details of the certificate. That phrase is somewhat vague. Amendment No. 10 does not suffer from the same defect. It states that the accountable person shall lay a copy of the exception certificate before each House of Parliament or the appropriate devolved assembly. We have always made it absolutely clear that the relevant Minister should be accountable to Parliament. We therefore accept that amendment and would support it if the noble Lord,
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Lord Mackay of Ardbrecknish, is minded to move it. He has made his contribution to the Freedom of Information Bill.
I turn to Amendment No. 11 tabled by the noble Lord, Lord Norton of Louth. The effect of the amendment would be that the certificate would be invalidated unless approved by a resolution of both Houses within 20 sitting days. The amendment would also have the effect that a Minister, having signed an exception certificate, would be required within the same period of time to pass in confidence to a Joint Committee the information in question.
As I said in the debate on an identical amendment on Report, that would certainly result in additional delays in reaching a view on whether information might be disclosed or withheld, but I do not believe that it would lead to any greater transparency than the Bill already provides, in particular with the amendment soon to be moved by the noble Lord, Lord Mackay of Ardbrecknish. It is clear that the exception certificate process is not something which would be undertaken without very serious consideration. There are safeguards to ensure that decisions must be transparent. The Minister must give public reasons for the decision. The commissioner will have had the opportunity, if she wishes, to see all the relevant information. She can report under Clause 49 any shortcomings in the decision-making procedure to Parliament, and Parliament itself can, at any time, hold the Minister to account for his actions. We think that that is sensible. It delivers the objectives that the more complicated procedure proposed by the noble Lord, Lord Norton of Louth, also seeks to deliver.
We have repeatedly made our position clear on why it is important that Ministers are and must be seen to be responsible in relation to decisions of that sort. We believe that it is right that Ministers, backed by the collective responsibility of Cabinet, should be seen to be responsible for taking decisions in areas such as these and that this is preferable to a position in which that responsibility is transferred to Parliament. In effect, that is what the amendment tabled by the noble Lord, Lord Norton, would do. It is right that Parliament holds Ministers to account in relation to that in a way which involves reasons, direct knowledge of what is happening and an independent person able to report any shortcomings. However, ultimately it is for Ministers accountable to Parliament, with Parliament being provided with the proper information, who have to take the decisions. In all the circumstances, I would invite the noble Lord, Lord Norton of Louth, not to move his amendment.
Lord Mackay of Ardbrecknish: My Lords, I am grateful to the Minister for accepting the argument put forward by myself and noble friend Lord Norton. I am sure that my noble friend accepts that his amendment was pretty much a nuclear option and would require much more parliamentary procedure than my amendment. However, I am grateful to the Minister for accepting that Amendment No. 10 carries out that for which we were searching at Report and, indeed, in Committee; that is, a way for Parliament to be

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informed expeditiously about the occasions on which government Ministers have used the veto. I suppose I can mark that as a triumph. I shall now be able to look the noble Lords, Lord Lester, and Goodhart, in the face in the competition for who made any amendments to this Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 10:
Page 31, line 36, at end insert—
("() Where the accountable person gives a certificate to the Commissioner under subsection (2) he shall as soon as practicable thereafter lay a copy of the certificate before—

(a) each House of Parliament,

(b) the Northern Ireland Assembly, in any case where the certificate relates to a decision notice or enforcement notice which has been served on a Northern Ireland department or any Northern Ireland public authority, or

(c) the National Assembly for Wales, in any case where the certificate relates to a decision notice or enforcement notice which has been served on the National Assembly for Wales or any Welsh public authority.").

On Question, amendment agreed to.
[Amendment No. 11 not moved.]
5 p.m.
Schedule 6 [Further amendments of Data Protection Act 1998]:
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 12:
Page 71, line 4, at end insert—
(" . In Schedule 3 to that Act (conditions relevant for the purposes of the first data protection principle: processing of any personal data) in paragraph 8(2) after the words "medical research," there is inserted "for the purpose of monitoring the public health".").
The noble Lord said: My Lords, in moving Amendment No. 12 I shall not repeat the points made at Report. I simply reiterate that my main motive in tabling amendments on Report and at Third Reading has been the threat to cancer registries potentially posed by an insistence that either all personal data imparted by clinicians to registries must be subject to patient consent or the insistence that information is wholly anonymised. In the view of the registries, that step would render the information of far less use.
Much of the past three weeks has been spent by me trying to get to the bottom of why that should be so and what can be done about it. Sometimes I have felt that I have been hunting the snark in trying to find out the real problems. However, I thank the GMC and the Data Protection Commissioner for their helpful briefings in that respect.
The Minister's statement on Report was also in many ways a breath of fresh air and helpful in pointing out that the Data Protection Act was not the sole culprit, but rather that the common law of confidence was perhaps the greater problem. The noble Lord, Lord Hunt of Kings Heath, and his officials in the Department of Health have also been helpful, not only in analysing the problem but in suggesting solutions and bringing together the interested parties.
The problems faced by the cancer registries need to be looked at as a series of legal hurdles to overcome if they are to comply with the law and avoid prosecution. The first hurdle is posed by the Data Protection Act where the first data protection principle of fair processing of information needs to be satisfied, and the third principle relating to personal data being adequate, relevant and not excessive must also be satisfied.
As the Minister helpfully confirmed on Report, the Schedule 3 conditions for necessary medical purposes will almost certainly cover this type of public health monitoring. Both the department and the Data Protection Commissioner, however, consider that to qualify as "necessary" there will be an obligation on cancer registries to be satisfied that they really do need all the personal information they collect and to reduce it to the minimum, which is also necessary if the third principle is to be met. There will also need to be adequate information supplied by hospitals and clinics about the work of the cancer registries and the information supplied to them by medical staff so that patients understand what information is supplied and why.
I support the aim of providing better information in that respect to ensure greater awareness of those who are being treated. But that is a different matter from a requirement for consent or explicit consent which can be extremely difficult and, indeed, inappropriate to obtain. Given that, however, the major hurdle appears to be the common law duty of confidence and the protection of a patient's right to privacy.
The Source Informatics case, decided earlier this year, seems to be the legal precedent which is exercising the minds of lawyers advising the GMC, the Data Protection Commissioner and the Department of Health, although the facts of that case, which dealt with anonymised prescribing information being collated for commercial purposes, certainly does not seem to be four-square with the situation here. Indeed, it is slightly baffling since the Department of Health appears to be appealing that decision. I am not sure why it relies on a decision against which it is appealing. My noble friend Lord Lester played an illustrious role in that case, as those who know the case will know, on behalf of the GMC.
That said, the view appears to be that, despite the Data Protection Act, at common law it is not sufficiently clear whether there is a public interest defence in those circumstances for public health monitoring in general and cancer health registries in particular. I believe that the department and Ministers now accept the fact that legislation, probably both primary and secondary in nature, will need to be introduced at the earliest opportunity in order to clarify the situation and that the provision of such information is in the public interest. I very much welcome that acceptance and hope the Minister today will express a clear commitment in that regard.
Finally, at the end of this legal trail we have the Human Rights Act 1998 and the European Convention on Human Rights where cancer registries

849
would need to show pressing social need and proportionality in collecting confidential information from patients. I hope that the early steps taken will allow those tests to be met. Clearly, as I outlined, a number of steps must be taken as a matter of some urgency by government if cancer registries are to continue with their work and not have interruptions or gaps in the data provided to them. In that context, the decision of the GMC not to enforce its code of confidentiality until October next year is to be welcomed.
I am pleased that the organisations involved, including the GMC, seem to be close to consensus about the way forward. However, it places a heavy responsibility on the Government to take the necessary action in the meantime. I look forward to the Minister's assurances in that respect. I beg to move.
Lord Falconer of Thoroton: My Lords, I have listened most carefully to the noble Lord, Lord Clement-Jones, on this occasion and on Report, and also to my noble friend Lord Turnberg, who expressed similar concerns in relation to public health work, including the tracing of communicable diseases.
We share the concern of the noble Lord, Lord Clement-Jones, for the future of cancer registries, but the amendment to the Data Protection Act will not help in the way he intends. As I shall explain, it is not primarily a data protection issue. I should like to reassure the noble Lord that the Government are taking these concerns seriously and will take whatever action is necessary to secure the future of cancer registration and other essential medical work, including work relating to public health. If there is no practical alternative, as I told the House on Report, we shall introduce supporting legislation at the earliest opportunity.
Perhaps I may briefly go through the points. The noble Lord, Lord Clement-Jones, knows that the Data Protection Commissioner believes that the processing currently being done by the registries is being done for medical purposes. The commissioner was kind enough to copy to the Home Office and to the Department of Health her letter of 15th November to the noble Lord which makes that point. Disclosure of personal data for such purposes is provided for by Schedule 3 to the 1998 Act. There is therefore no need for a change in that Act. The noble Lord may consider, despite the commissioner's views, that that is still to be tested and that legislation will put it beyond doubt.
The Government take the same view of the law on that point as the commissioner, but I can repeat the assurances I gave a few moments ago. In the unlikely event that our interpretation of the law is wrong, the Government stand ready to consider with the noble Lord and his advisers what actions may be necessary to secure the future of cancer registration or public health work. The Act allows additional "gateways" for the processing, including disclosure, of medical data to be provided by subordinate legislation. If it is necessary—for the reasons I gave neither the
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Government nor the commissioner believe it is—we will introduce amending secondary legislation to address the concerns.
The point was also clearly made by the noble Lord in regard to common law confidentiality. We believe that the General Medical Council's advice that doctors should disclose sensitive personal data only with consent reflects its understanding of the common law duty of confidence rather than any concerns about the 1998 Act. It is said that the law of confidence requires patients to consent to the disclosure of their personal data unless there is an overriding public interest. The Department of Health is aware of the concerns raised from medical research, including the activities of cancer registries and also in relation to the public health. If there is evidence that the common law duty of confidence might put continuing medical research or public health activity at risk, the Department of Health made it clear that it will look to see what can be done without the need for legislation. But if that is not possible, it will be prepared to introduce legislation at the earliest possible opportunity to address those concerns.
I hope that in the light of those assurances the noble Lord, Lord Clement-Jones, will feel able to withdraw his amendment.
Lord Clement-Jones: My Lords, I thank the Minister for that reply. I am grateful for that clear exposition, which wholly tallies with my understanding of the situation. I am fairly convinced that legislation will be needed and in those circumstances I am grateful for his assurance that early legislation will be brought forward. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Falconer of Thoroton: My Lords, I beg to move that the Bill do now pass.
Moved, that the Bill do now pass.—(Lord Falconer of Thoroton.)
Lord McNally: My Lords, I well realise that the Minister is waiting to make a Statement and I see the foreign policy buffs gathering. But it is worth making one or two short observations.
We are at the end of a 25-year road along which many colleagues have travelled. So I should like to pay tribute in the passage of this Bill to my colleagues, my noble friends Lord Goodhart and Lord Lester, for their contributions, and also to the Minister, the noble and learned Lord, Lord Falconer, who dealt with us at all times with great courtesy and often with great constructiveness.
The noble Lord, Lord Mackay of Ardbrecknish, asked on a number of occasions whether these Benches spoke as shadows or surrogates. We are glad to take both descriptions in the final shape of the Bill. Much was made by the Conservatives of the so-called "deal" we made with the Government Front Bench over some key amendments. A lot of that indignation was

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synthetic. They proved, with the age of consent Bill and the Disqualifications Bill, that if they want to turn out their troops they can do so without our support.
However, the concessions we obtained from the Government were worth while. Those who claimed that we "blinked too early" must consider whether they really wanted the Freedom of Information Bill thrown into the maelstrom of the last eight days of this Session. Whatever else, the passage of the Bill tonight guarantees that the Freedom of Information Bill will be on the statute book this Session. The real analogy is not parliamentary ping-pong but parliamentary poker. It is sometimes smart to know when to cash in your chips and we did that at the right time.
This is not the Bill which the Liberal Democrats would have passed. It is not the Bill which David Clarke would have passed. At this stage it is worth paying tribute to David Clarke's White Paper, which will remain for all of us a benchmark yet to be attained. But it is a Bill worth having. I should have preferred to hear a few more cries of pain from the noble Lords, Lord Armstrong of Ilminster and Lord Butler of Brock well, but you cannot have everything!
In conclusion, there are three hurdles which even an Act of Parliament must clear in order to be effective. The first two were referred to by my noble friend Lord Lester. First, the Bill will need an information commissioner who is robust in testing the powers which it gives her. Secondly, it will need the courts to be liberal and radical in their interpretation. Thirdly and most importantly—and this was referred to by the noble Lord, Lord Brennan—it will need Ministers who believe in freedom of information. One of the most telling points ever made about the previous administration was made by the noble Lord, Lord Lamont, when he described his colleagues as being in office but not in power. That charge sometimes hangs over the present Government.
All ministerial office is transitory. One of the lasting marks which each and every one of the present Ministers can make during their period of office is to ensure that the Bill is followed in spirit as well as in letter in the Whitehall departments over which they preside. It is no use blaming the wiles of Sir Humphrey, or even of Sir Robert or Sir Robin, if Ministers do not try to make the Bill work. If they initiate the training programmes to instil a new culture into the bureaucracy, and if they believe in the citizens' right to know, the Bill will be seen as more significant than its critics now allow. It will redeem a 25-year promise and justify the Campaign for Freedom of Information, Charter '88, the UCL Constitution Unit and others who have worked so hard to put it on the statute book. It will strengthen our democracy, make the executive more accountable and increase the power of both Houses of Parliament and of the three aspects of the media to ensure that those who seek to rule us are our servants, not our masters.
The Earl of Northesk: My Lords, your Lordships will appreciate the need of my noble friend Lord Mackay to prepare for his business scheduled for today. It will come as no surprise to the Minister—
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indeed, to the whole House—that he is even now working feverishly to engender the same degree of consensus and co-operation which we enjoyed during the Bill's Third Reading, particularly on Amendment No. 10.
Accordingly, and although I am a poor substitute, on behalf of my noble friend I join in the plaudit; of the noble Lord, Lord McNally. As usual, the House can congratulate itself that the Bill, whatever its gestation, is returned to another place in much better shape than when it arrived. I congratulate all noble Lords who have assisted in that process, not least my noble friends Lord Lucas and Lord Norton. I thank the Government Front Bench, the noble and learned Lord the Minister and his officials for ensuring that our debates on the Bill have been unfailingly courteous and informative.
Lord Falconer of Thoroton: My Lords, I, too, join noble Lords in their remarks about the good natured and constructive way in which debates on the Bill have been conducted. We have made significant changes to the Bill and I am grateful for all the contributions from around the House.
On Question, Bill passed, and returned to the Commons with amendments.

Business
Lord Davies of Oldham: My Lords, before we move to the Statement on European Defence Co-operation, I should like to take this opportunity to remind the House that the Companion indicates that discussion on a Statement should be confined to brief comments and questions for clarification. Peers who speak at length do so at the expense of other noble Lords.

European Defence Co-operation
5.25 p.m.
The Minister of State, Ministry of Defence (Baroness Symons of Vernham Dean): My Lords, with the leave of the House, I shall now repeat a Statement on European defence co-operation being made by my right honourable friend the Secretary of State for Defence in another place. The Statement is as follows:
"With permission, I would like to make a Statement to the House about recent developments in European defence co-operation. There are those who in recent days have, frankly, become a little over-excited. I would like to try to set out the facts and separate them from the Euro-sceptic fiction.
"Our aim is the improvement of European military capabilities to deal with the security challenges now facing us. These enhanced capabilities will be available to the countries concerned, to the European Union and to NATO. This is a key step towards achieving our goal of strengthening the European pillar of NATO and encouraging our European partners to do more.

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"This is an aim that everyone in this House should share. It is about making it easier for British Armed Forces to deploy in a multi-national context—something which is a routine requirement of modern operations. I spent this morning with the Royal Regiment of Wales and the Royal Green Jackets, currently serving in Paderborn in Germany. They emphasised the number of recent occasions when they had been deployed alongside European forces, from Holland, from France and from Italy.
"I would like to set out just what we have been discussing this week at the Capabilities Commitments Conference in Brussels. Last year, at the Helsinki Summit, it was agreed that European Union nations should by 2003 be able to deploy rapidly up to 60,000 ground troops to meet the full range of crisis management tasks. These troops could either contribute to NATO-led operations or, where NATO as a whole was not engaged, to European-led crisis management missions.
"Over the past two days, European partners, both in the European Union and those outside it, have been identifying the type and level of forces that they might be able to make available to Petersberg operations. This is not a standing European army. It is a pool of potentially available national forces. It envisages full transparency and consultation with NATO as a potential crisis develops. It would then be for contributing countries to decide whether, when and how to deploy their armed forces. No country would have to take part. The British Prime Minister, answerable to this House, will always have the final say over the use and deployment of British Armed Forces.
"NATO is, and will remain, the cornerstone of European defence. It alone remains responsible for the collective territorial defence of its member states. The European Union has stated repeatedly that its aim is to have the ability to conduct military crisis management operations only where NATO as a whole is not engaged. Nothing that has been done in the European Union this week changes any of that. For the foreseeable future, major operations of this kind would draw on NATO assets and use NATO operational planning and command structures. It would, in short, be NATO-supported. So, it is time we lowered the temperature and raised the tone of the debate.
"One way of doing this is to place the current developments in context. In 1992, the Maastricht Treaty established the present framework of the European Union. It was this treaty which established the so-called 'second pillar' of a common foreign and security policy. It said that member states,
'shall define and implement a common foreign and security policy'
and went on to specify that this,
'shall include all questions related to the security of the Union, including the eventual framing of a common defence policy, which might in time lead to a common defence'.
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That policy was signed up to by the previous Conservative Government—by both the right honourable Member for Huntingdon as well as the current Leader of the Opposition. Through the Western European Union, the previous Government explicitly promoted the development of a European capability for use when NATO as a whole was not engaged. They seem to have forgotten that.
"I assume that this policy is still supported by the right honourable Member for Huntingdon. Those who look for consistency in their politicians might assume that the Leader of the Opposition would still support a policy to which he signed up as an ambitious Minister in government. At least it can be said that in terms of consistency the Shadow Defence Spokesman has consistently opposed Maastricht and the European Union. His Euro-sceptic opposition now leads the Conservative Party, with its leader jumping on the anti-European bandwagon.
"The Leader of the Opposition should not try to hide behind NATO. It was NATO at Berlin in 1996 that offered to make its assets available for European operations; and it was NATO at the Washington Summit last year that offered its support for the European Defence Initiative. The policy we are discussing today has not suddenly appeared. What we are doing is a long way short of the aspirations to which the previous Government agreed.
"I apologise for this short history lesson. It is important to be clear that the aim I declared at the beginning—the improvement of European capabilities—is not only one that all parties have shared but one that has already been pursued over several years. Yet, if it is necessary for Europeans to do more, why do they not simply take action within NATO? The answer is that we do take action within NATO. The fundamental structures of co-operation are there in planning, training and command and control arrangements. What we are doing through the European Union will complement this action.
"There are three main reasons for saying so. First, there is a clear imbalance in capabilities between the Europeans and the United States which has grown over the past decade. Kosovo was a wake-up call. Both the US and NATO strongly support increased efforts by Europe to respond to this challenge. Not a single senior figure in the US Administration is opposed to these proposals. Madeleine Albright described Monday's conference in Brussels as
'a strongly positive development [that] we wholly support'.
At the recent NATO conference in Birmingham Bill Cohen, the US Defense Secretary, said:
'Let me be clear on the American position. We agree with this goal, not grudgingly, not with resignation, but with wholehearted conviction'.
"The effort that is now being put into developing better European capabilities, which is being led by Britain, is beginning to have an effect. For years

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defence budgets around Europe have been falling. Next year, according to figures given to NATO by its member nations, defence spending will rise in real terms in 11 of the 16 European states of NATO. The restructuring of armed forces to make them better equipped to face today's challenges is taking place in a number of EU countries.
"Secondly, the European Union is already actively involved in crises through economic sanctions, diplomatic measures and humanitarian aid, but it has lacked clout. In security matters, especially in a real crisis, political weight reflects military weight. The EU has lacked a practical method for mobilising a military response.
"The third reason is that additional political will and momentum for Europe to improve its capabilities is best generated through NATO and the EU. The multi-dimensional nature of security issues demands a co-ordinated political response. For that, frankly, we would be failing if we did not make full use of the mechanisms offered by the European Union. The Capability Commitments Conference earlier this week is neither something to fear nor something to scaremonger about. On the contrary, we as a nation should be delighted to see our European partners making a serious commitment to improve their capability to be able to respond to crisis management situations. It strengthens the military capability and resolve in the EU and also the capability within the NATO Alliance.
"This is a statement of requirement—a goal, a level of ambition. It is a means of galvanising action. That is why it is called the Headline Goal. It is not a European army: it is not even a standing rapid reaction force. Nor is it confined to the European Union. On Tuesday, we heard from non-EU NATO nations and from the 15 EU aspirants. They too support this goal and have offered forces towards it. Yet, as we have seen, the Opposition would pull Britain out of this process and isolate us not only among the 15 EU members but also non-EU states.
"Since Helsinki, military experts in both EU countries and NATO have developed a detailed statement of requirement for the pool of forces and capabilities needed to cover the Petersberg tasks: peacekeeping, peace support and peace enforcement. On Monday, countries nominated elements of their national forces which they believed could contribute to this requirement. The process of identifying these forces is, in principle, no different from the process of declaring forces to NATO or to the United Nations. We need the ability to assemble the right sort of force quickly for a range of possible operations.
"The key difference about the current initiative is that capabilities are being identified against a specific goal. The countries involved are demonstrating their determination to follow through in the areas of shortfall and deficiency which this process will highlight. Therefore, this is a
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step in a process, not the end of the road. We are perfectly well aware that there are many detailed issues to be followed up in both the EU and NATO.
"Like others, the UK has identified a pool of forces and capabilities as its contribution to wards achievement of the headline goal. These forces provide for a balance across the full range of Petersberg tasks, including the most demanding. In the maximum scale operation envisaged at Helsinki—a corps level deployment of up to 60,000 ground troops—the UK land component could be about 12,000 strong. Maritime and air deployments of up to 18 warships and 72 combat aircraft could be made in addition. I set all this out in more detail in my response to the Question from my honourable friend the Member for Loughborough on Monday.
"Let me be clear about what this initiative is and what it is not. It is a planning process to ensure a more effective defence effort by European forces. It is a mechanism to improve European contributions to NATO and to ensure that European nations can in future play a more effective part in alliance operations. It will encourage more efficient and targeted defence spending by our European friends, and it will ensure that when NATO is not engaged the European Union can act effectively in a wide range of peace support operations, if and when its member nations want it to.
"It is not a European army or even a standing reaction force. It is not an agreement to give up or reduce Britain's sovereign control over British forces, and it is not a commitment to undertake operations in which we would not previously have wished to take part. It is not, therefore, a new burden for our Armed Forces. Those who have said this either do not understand what is happening or deliberately seek to mislead for reasons of political opportunism. The success of our Armed Forces in co-operating with our partners and allies deserves better. The Opposition should be ashamed of themselves for trying to use our Armed Forces to further their own anti-European obsessions".
My Lords, that concludes the Statement.
5.29 p.m.
Lord Howell of Guildford: My Lords, I am extremely grateful to the noble Baroness for repeating the Statement. I hope that the Minister will forgive me if I do not pursue the reference to over-excitement—I note that the earlier draft referred to "hysteria"—and the partisan jibes. I am sure your Lordships agree that those matters are more suitable for another place, and in any event they are not appropriate in view of the very serious nature of the issue that we are discussing. So I shall ignore them.
We on this side of the House are totally in favour of a stronger European contribution to NATO, a stronger European branch of NATO. If this project is about that, and that really is the aim of the entire undertaking, we would have no problems with it. We have always supported that. That is what NATO put forward at Berlin in 1996. The Secretary of State for

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Defence is right to allude to it. The previous government supported it. We still support it from this side.
But the question is: is this still the same project? Does not this new proposal have its own unified command; its own planning committees under the European Union; its own military staff, already set up incidentally—I do not know under what powers, but perhaps the noble Baroness will tell us; and its own headquarters? Eventually, the clear intention is that it should have also its own intelligence, logistics and heavy-lift. That will happen only when the money is found, because we are talking about enormous sums. If it is not found there would be a danger of vast duplication.
We want to see NATO strengthened by a greater European contribution. But anyone who has been in the Army, even in a junior position, will know that it is essential for soldiers to have a single command and control structure and single and clear planning procedures. There is a risk here that we shall have double command and control and a double set of planning procedures. For instance, the Deputy SACEUR will not be the co-ordinating officer for the new force and for NATO; he will have merely a liaison role. Can the noble Baroness explain why that should be so? That does not imply the kind of unity and clarity of command which soldiers need.
I turn to the question of defence spending. Where is the money coming from? In his Commons Statement the Secretary of State mentioned more spending next year. But it will need to be a very large increase. What will be cut to make room for it? Will other defence arrangements be cut? We need to be clear on that issue and not just push it aside. Everyone, including the Pentagon and the Americans concerned, has made it clear that they want to see more spending to make a reality of this, if it is not just to be a paper exercise.
Then we have the non-EU NATO states which are extremely worried. The statement pushes that aside. But Turkey has expressed profound concern that it is being cut out of the planning procedures. Norway has also expressed some worries. Can the noble Baroness reassure us that those countries' worries are misplaced and that it will be the same as before for them? Is she aware—this is perhaps the most important of all the points—that, despite the strong statements, which I recognise from Madeleine Albright and others, there are many worries in the United States. She must have heard them. She is very close to these matters. Did she notice the recent quotation from the US Ambassador to NATO? He said:
"done poorly, this process can divide the transatlantic alliance, lead to decreased US engagement in European security matters and diminish European capacity to manage crises".
Those are not the words of someone who is not worried or who is totally and unconditionally supportive. There are worries.
Finally, I would say to the noble Baroness that the Secretary of State's Statement offers us some history lessons. There is much history in the role and position
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of the noble Baroness's party in defence matters. I do not want to go over that now. But a couple of years ago the Prime Minister said that nothing must undermine NATO. Our view is that there is a real risk that this could undermine NATO. It is regrettable that our superb Armed Forces, which the world admires, are now caught up in what looks dangerously like a political game. We need much more reassurance from the noble Baroness and from the Government before we can say that this is just more of the same and no one should worry.
5.34 p.m.
Lord Wallace of Saltaire: My Lords, this was an unusually partisan Statement. On most occasions from these Benches we would deplore that. But on this occasion we agree that that is justified.
The reaction of the Conservatives and of the press has been—I am sorry the Minister did not repeat the word—hysterical. This is a British initiative which has been well-signalled over the past 18 months and builds on the policy of the previous government. It has been carried through by a Secretary-General of the Council who was previously the Secretary-General of NATO. The idea that this is some dreadful French plot being sprung on the British—which is how the Daily Telegraph likes to describe it—is clearly absurd.
Perhaps I may remind noble Lords that in June 1962 President Kennedy of the United States of America first called for a European pillar of NATO. In 1964, as a young Liberal, I took part in a study group in the United States on how to improve the European pillar of NATO—a short while ago. The Americans have made it entirely clear since then that they expect the Europeans to stand more on their own two feet. If we now face a Bush administration, Condoleeza Rice, one of his key advisers, has also made it clear that the Americans will reduce the number of their troops in Europe and will expect the Europeans to stand more on their own two feet.
My understanding is that British troops have been engaged in some 22 to 24 operations since 1990. In 17 of those we have operated outside of NATO command with forces from a range of other countries. Part of the origin of this initiative, as I understand the matter, is the co-operation from which British and French troops have benefited in Bosnia, which was a learning process for both sides. It was out of that that the previous Conservative government developed the Franco-British defence initiative, at a time when Michael Portillo was the Secretary of State for Defence. Indeed, a Franco-British air wing had been agreed during the term of office of the previous government. German forces were already training in Britain. That had been agreed many years previously. There was the joint Tornado training team in England and Italy. German tank crews were training in Pembrokeshire and elsewhere. There is the Dutch-British marine amphibious force. So much of this is not new.
As we understand it on these Benches, the aim of the defence initiative is to improve European capabilities; to challenge other European governments to follow

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the British model; and to improve our ability to work together in the field. Under most circumstances, we expect that British troops will be working with troops of other nations in the field.
Perhaps I may ask the Minister a few questions. First, how satisfied is she with the pledges which were given in this pledging conference and what are the most worrying remaining gaps? Secondly, does this imply that changes will need to be made to the treaties at Nice in order to incorporate the interim arrangements, to which the noble Lord, Lord Howell of Guildford, referred, and to bring them more within the constitutional arrangements? Lastly, is parallel progress underway in civilian crisis management and in the provision of seconded police forces for the follow up to necessary Petersberg task engagements?
5.38 p.m.
Baroness Symons of Vernham Dean: My Lords, I thank both noble Lords for their responses to the Statement and for the constructive way in which they have approached it.
Perhaps I may say to both noble Lords that I repeated the Statement as it was given by my right honourable friend in another place, as is my duty in your Lordships' House. The word "hysterical" was not used in another place.
I am very pleased that the noble Lord, Lord Howell of Guildford, is in favour of a stronger European defence. That is entirely consistent with the position that has been taken by his party under the Maastricht Treaty and indeed elsewhere. The noble Lord said that he had a number of misgivings. To a certain extent, I can understand those misgivings. I believe that they were based on a number of fundamental misconceptions. We are talking here about Petersberg tasks. Those Petersberg tasks might range from humanitarian relief, which is fairly straightforward, through peace-keeping, to—as the Statement made clear—peace enforcement. Peace enforcement is likely to include a commitment to a greater number of troops.None the less, these are Petersberg tasks.
The noble Lord was worried about the costs that might be involved. The additional costs to the Ministry of Defence are expected to be over £200,000. That figure is based on the cost of additional persons for the EU military structures. But it is offset—this is an important point—against the wind-down of the WEU. Both those factors have to be taken into account. In addition, the FCO will require an establishment of six posts within the EU structures. The cost of that will be somewhere between £300,000 and £500,000. Therefore, the additional cost to the UK taxpayer should be somewhere between £500,000 and £1 million. It is important that all noble Lords understand that there will be an off-set.
The noble Lord was understandably concerned about the way in which planning procedures will be undertaken. I may be able to help him a little on that point but I cannot go into great detail. For many of the operations, the preferred option will be the Deputy
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Supreme Allied Commander Europe—DSACEUR—and the facilities of SHAPE—Supreme Headquarters Allied Powers Europe—will also be deployed. Planning would be done initially by SHAPE and recommendations would be made from SHAPE to the European governments. It might make recommendations about the operational commanders and how a group of forces might go into an operational position. The commander would be responsible to the European governments.
I do not think that there is anything very exceptional in that. What is proposed is not particularly startling. I do not think that many of your Lordships will find it particularly different from the accepted means of multi-national co-operation on a number of these issues. I hope that that puts some of the noble Lord's worries into context. Of course, it would not always be SHAPE. For example, for small operations—such as humanitarian operations—different planning mechanisms might be used. I am sure that your Lordships would find that entirely proper and consistent for operations that did not involve a heavy military deployment. I hope that I have dealt satisfactorily with the questions about costs and about the way in which the commander structures will work.
The noble Lord understandably raised concerns about those who are members of NATO but stand outside Europe. He referred in particular to Turkey. I can say that Turkey attended the meeting in Brussels yesterday morning. The noble Lord is quite right. Turkey has in the past expressed some concerns about these discussions. But I am happy to say that yesterday Turkey was able to commit some troops to the Headline Goal. I am not able at the moment to put this into the public arena any more than I am able—I say this to the noble Lord, Lord Wallace of Saltaire—to put into the public arena the details of what has been put forward by other European Union countries. That is because not all countries are as open about these matters as the United Kingdom; and in any event they would want to put them into the public arena first in their own countries. I hope that as soon as such information becomes publicly available in their own countries we will be able to give maximum information on what has been put forward by other countries. I am sure that your Lordships would wish to have that information. I shall do my best to ensure that it is made available to the House as soon as possible.
The noble Lord, Lord Howell of Guildford, was worried about what had been said by the US ambassador to NATO. Anything done poorly can cause trouble between nations. But it was interesting to hear the US ambassador to the EU saying yesterday:
"We strongly support the European defence force—the rapid reaction force. We think it will help and strengthen NATO".
The noble Lord has been kind enough to acknowledge what Madeleine Albright has said. He will know, because he is very experienced in these matters, that that reinforces what Strobe Talbot and Bill Cohen have said. We have had a considerable degree of support from our allies in the United States who, for a considerable time, as the noble Lord pointed out, have been stressing to the European nations that we had to

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do more to strengthen our position. I am happy to say that a number of European countries are not only putting more resources into their defence effort but are also reviewing that effort to ensure, as we have done with the SDR, that it is in line with modern defence needs and does not ratchet back into the old Cold War stance.
I am grateful to the noble Lord, Lord Wallace of Saltaire, for his support on the Statement. The Liberal Democrats have been very understanding of the position.
Noble Lords: Oh!
Baroness Symons of Vernham Dean: My Lords, the Liberal Democrats have quite rightly studied the position properly and, if I may say so, I thought that the noble Lord, Lord Howell of Guildford, had also understood the position very much better than some others in his party.
We have learnt considerable lessons from Kosovo. As the Statement said, Kosovo was a wake-up call. When we look at the number of sorties undertaken by NATO in Kosovo and see the sharp contrast between the number undertaken by the United States and the number undertaken by Europe, any responsible country would have to look at what it was able to do.
I hope that I have dealt with the questions asked by the noble Lord, Lord Howell, about our contribution. We believe that it is a proportionate contribution. It is in the range of about 20 per cent of the proportions put forward. But we are a strong defence nation in Europe and we believe that that is entirely consistent with our standing in Europe. We have been very pleased to see the way in which other nations have come forward. The noble Lord was quite right on civilian crisis management. These are important issues. We have been able to get rather further ahead on them than on some of the defence issues. Our discussions are continuing. As the Statement makes clear, this is not an end of the road; it is an important step on the way.
5.48 p.m.
Lord Bramall: My Lords, soldiers are supposed to advance to the sound of the guns; and so here I go over the parapet. Is the Minister aware that there are a number of us former military men who have had considerable experience over 50 years or more—one might say that one has almost lived history—of our Armed Forces serving under foreign commanders and non-national banners, inside NATO and elsewhere? Is she further aware that we do not subscribe to or share that—I hesitate to use the word, certainly not in your Lordships' House but in other places—hysterical reaction against closer European defence co-operation within NATO and indeed think it is entirely sensible for European countries, using their own national contingents, to get their act closer together to deal with specific eventualities of a limited nature and also to put them under some pressure to put their defence money where their mouth is?
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This is a serious initiative which should be looked at in a positive way. I am distressed to see that it seems to have been swept up in a much wider political argument.
Baroness Symons of Vernham Dean: My Lords, I thank the noble and gallant Lord for his words. I am aware of his very great experience in these matters. As he said, on very many occasions British armed forces have served under foreign commanders. I thank him for what he said about this being an entirely sensible way forward. He said that this will put pressure on our European partners. The noble and gallant Lord has often put pressure on me and on other Ministers concerning the resources available to the Armed Forces. I agree with him. I hope that this move will put pressure on others, those who so far have not been able to come forward with increases in their defence budgets, to think again on that front.
I thank the noble and gallant Lord for saying that this is a positive initiative. He has also said that he agrees with what has been said by the current Chief of the Defence Staff, General Sir Charles Guthrie. He commented that he had never heard anyone in authority within the chain of command in this country, whether Ministers or servicemen, talk of a European army, navy or air force. This move is not so very extraordinary. Once again I thank the noble and gallant Lord for his words of welcome, given that he has been so robust in his criticisms on other occasions.
Viscount Cranborne: My Lords, can the noble Baroness tell the House whether the neutral countries of the European Union have taken part in any of the conversations on this matter? I refer in particular to the Republic of Ireland and Sweden. Do those countries intend to take part in this initiative? If so, under what circumstances?
Baroness Symons of Vernham Dean: My Lords, I believe that the neutral countries have taken part in the discussions. The noble Viscount will know that, on occasion, the neutral countries do subscribe troops to NATO actions. Indeed, they did so recently in the Balkans, although on that occasion Ireland did not.
I cannot tell the noble Viscount that their representatives have been present on every occasion that this matter has been discussed. We would not necessarily expect them to be. However, if there is any more detail that I can reasonably send to the noble Viscount on what measures have been discussed with the neutral countries, I shall write to him and place a copy of the letter in the Library of the House.
Lord Gilbert: My Lords, on a couple of occasions my noble friend referred to peacekeeping and peacemaking activities. Can she tell the House, first, whether it is intended that this force shall have serious war-making capabilities and whether it is intended that those should be used? Secondly, can she confirm that it is not the present or future intention of Her Majesty's Government that either the deployment of British forces or the non-deployment of British forces

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shall at any time be subject to the decision of any organ of the European Union without the consent of the British Parliament and the British Government?
Baroness Symons of Vernham Dean: My Lords, I can give an unequivocal assurance to my noble friend: there will be no deployment or non-deployment of British forces without the express agreement of the British Prime Minister, who will be accountable to another place. I hope that that was made clear in the Statement. But I am grateful to my noble friend for giving me the opportunity to re-emphasise the point to the House.
As regards the other issues raised by my noble friend Lord Gilbert, perhaps I may explain in detail the Petersberg tasks. I know that they will be familiar to him but perhaps they will serve to bring home the point. Those tasks are of a humanitarian and rescue nature; namely, peacekeeping and tasks of combat forces in crisis management, including peacemaking. Peacemaking is an important task because it includes the separation of warring parties, conflict prevention, the evacuation of nationals and the provision of humanitarian aid. The important point to note here is that the Petersberg tasks imply a degree of conflict which can move beyond those of pure peacekeeping because they involve the separation of warring parties as well as peacemaking. Given the noble Lord's enormous experience in the Ministry of Defence, he will know far better than I that the tasks imply a greater degree of engagement in conflict than mere peacekeeping.
Lord Roper: My Lords, does the Minister agree that the Statement which she has repeated indicates that the Government have now accepted the position put forward from these Benches over a long period; namely, that there is no contradiction between being a good Atlanticist and being a good European? Does she also accept that the proposals which have been put forward for planning had already been accepted by NATO last year at its Washington summit? At that point, the representatives went as far as to form a "Berlin plus" agreement, a series of decisions which,
"Assured EU access to NATO planning capabilities able to contribute to military planning for EU-led operations",
as well as giving us,
"The presumption of availability to the EU of pre-identified NATO capabilities".
Does not this indicate that the 19 member states of NATO have already collectively endorsed this as a way of strengthening the capacities for security in Europe?
Baroness Symons of Vernham Dean: My Lords, perhaps I may say to the noble Lord, Lord Roper, that I believe that this reflects the position of sensible parliamentarians across all three parties. The noble Lord, Lord Howell of Guildford, has demonstrated to the House today that there are extremely sensible members in all the main political parties.
The noble Lord, Lord Roper, is right to say that these proposals are based on the planning put forward in Washington. I am happy to confirm that NATO has
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not, as some have suggested, been wringing its hands with despair over these developments. It has been pleased to see the development of what might be described, loosely, as a European pillar of NATO. As I have said already, we are happy to take this forward. We have not yet reached an end position but we have reached an important signpost in our progress on this matter.
Lord Chalfont: My Lords, I am grateful to the noble Baroness for repeating the Statement, although I must say that on occasion it sounded rather more like a party political broadcast than a ministerial Statement. However, the one point which most frightened me, but which I believe was meant to be reassuring, was that this is only one step along the road rather than the end of the road. That is what is worrying some of us a great deal. What is at the end of this road? If the establishment of this force is not the end of the road, to where does it lead? Is it leading to a political end or is it leading to a greater integration of the Armed Forces? I should be grateful if the noble Baroness could answer those questions when she comes to reply.
I think it is clear from the Statement that whichever side of the argument one is on there are clear and serious implications for the morale and effectiveness of our Armed Forces. It is no good to say that this does not affect the deployment of our Armed Forces. If such a force is ever deployed, it will increase the overstretch from which our Armed Forces already suffer. There are implications for our relationship with NATO. However that may work out and whomever one speaks to in the United States or in the Royal Regiment of Wales, it does not really tell us exactly what will be the impact on NATO.
At the very least, this has implications as regards our relationship with the United States, especially in the world of intelligence. I know that we cannot delve too deeply into the matter in your Lordships' House, but the noble Baroness will know that the implications of setting up a separate intelligence organisation within the European Union will be considerable. Furthermore, relationships with Russia are involved. President Putin has already begun to paddle in these waters, as we have seen from recent reports.
However, what is most important is this. Has anyone thought through the consequences of the expeditionary force concept, which this force will reflect? If it is to do anything at all, it will either form or be the basis of an expeditionary force activity taking place somewhere. Has anyone yet worked out how that force is to be protected, especially against missiles if its members start dabbling in areas in which there has been a proliferation of ballistic missiles? Can the noble Baroness tell us whether all these implications have been thoroughly studied? When we come to debate these matters, I hope that we shall be given rather more information about this.
In that context, I wonder whether any other noble Lords share my view? I have received a signal from the Government Front Bench to sit down. I am not going to sit down because this matter is too important. My final point is this: I am surprised that this was not made

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the subject of a full debate in Parliament before any action was taken. This represents a fundamental change in the deployment of our Armed Forces, with constitutional implications. I hope that the noble Baroness will use her influence with the usual channels to ensure that we can have a full debate on this in your Lordships' House at the earliest possible opportunity.
Baroness Symons of Vernham Dean: My Lords, as to the noble Lord's final point, to my certain knowledge the House has discussed this issue following Statements in relation to NATO summits and EU summits, and I have, both as a Foreign Office Minister and Defence Minister, answered a number of questions raised in a number of debates. As this Statement makes clear, this has not come as a bolt from the blue. The Government have signalled it for a very long time—certainly from the St Malo discussions at the end of 1998, which began with the Prime Minister's visit to France on that occasion. I take issue with the noble Lord's implication that this matter has been sprung on Parliament when the groundwork has been very carefully laid.
The noble Lord asked where this is all leading. He said, "The noble Baroness said that this was a step on the way, so where is this path taking us?" It is leading to better equipped European armed forces. It is leading to forces which will be able to engage where NATO decides not to. That is where it is leading. It is very clear. It is doing so because of the lessons we learnt in Kosovo and because the United States, on a number of occasions, has made clear to its European allies that it believes we should be putting more effort into our defence capability. We believe that is right, as do the other nations in Europe. That is where it is leading.
This is a step forward because we are now agreeing to it. Implementation is, of course, a quite different issue. Having now made these agreements, we have to see how they are implemented. That is the sense in which I say this is a very important step.
Our colleagues in NATO believe that this is a sensible move. On 20th November, the noble Lord, Lord Robertson, stated:
"This is simply a sensible project designed to build relevant European capabilities, all of which will be available to NATO. It is designed specifically to complement NATO and not to duplicate it or undermine it, and certainly not to replace it".
I heard a commentator on the radio this morning say, "Well, Lord Robertson would say that, wouldn't he? He used to be a Labour Minister". That is to do less than justice to the integrity of the noble Lord, Lord Robertson, as the Secretary-General of NATO. Quite rightly, he puts NATO first. Noble Lords on the Benches opposite may find that amusing, but we on these Benches take those points very seriously. I shall certainly defend the integrity of the noble Lord, Lord Robertson, in what he said.
As I said to my noble friend Lord Gilbert, it is important to remember that the tasks to be undertaken are Petersberg tasks. The noble Lord is right to say that if we are to engage in these tasks—whether as a single
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country or in co-operation with others—our troops must be properly equipped. That is why we have taken such pains to learn the lessons from Kosovo. We are being painstaking over what we should be doing about communication systems and painstaking over what we should be doing about our missile systems. We have taken steps to ensure that we have better equipment for our Armed Forces in the short term as well as in the long term.
I can assure the noble Lord, Lord Chalfont, that the safety of our troops is at the forefront of our minds. These issues would be the same for any expeditionary force in which the United Kingdom's Armed Forces were engaged.
The Earl of Onslow: My Lords—
Lord Pearson of Rannoch: My Lords, the Minister—
Lord Shore of Stepney: My Lords—
The Attorney-General (Lord Williams of Mostyn): My Lords, I believe it is the turn of the Conservatives.
The Earl of Onslow: My Lords—
Lord Pearson of Rannoch: My Lords, perhaps I may ask the Minister—
Lord Williams of Mostyn: My Lords, I suggest that we first hear the noble Lord. Lord Pearson.
Lord Pearson of Rannoch: My Lords, no less than three times the Minister has said that this will not be a European army. Will she perhaps comment on the remarks of no less a person than the President of the European Commission, Mr Prodi, who said recently,
"You need not call it an EU army if you do not want to. You can call it a Margaret, or you can call it a Mary-Anne. You can call it what you like, but it will be an EU army".
Does the Minister agree that there is also another view on this European initiative; that it is in truth inspired by France's jealousy of the United States—by France's unfortunate need to bite the hand that freed her in no less than two world wars? Is not that the real reason why the new force has to be capable of autonomous action from NATO, and why it will inevitably undermine NATO in due course?
Finally, what will happen if our troops are fully committed to an EU operation, lasting perhaps more than a year, and something happens in another sphere of our interest which requires those troops? Will we be able to withdraw them from the EU operation and send them to the other area, or will they remain under the command of the EU commander and subject to a qualified majority vote for the prosecution of that operation?
Baroness Symons of Vernham Dean: My Lords, the noble Lord has quoted something that he said that Mr Prodi said. There have been an awful lot of quotes put forward from an awful lot of European colleagues in the past few days. As the noble Lord will know if he

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is quoted in the press as often as some of us, these quotes are not always reliable. I prefer to look at the communiqué that was issued at the end of the Brussels meeting. After all, it is the authoritative voice of what was said. The communiqué states:
"This is a process without unnecessary duplication and it does not involve the establishment of a European army".
It is unequivocal; it is in the communiqué—and it is there for everyone to read.
The noble Lord made tendentious comments about what he described as France's jealousy of the United States. I shall not get involved in speculation about why any country has decided to do what it has done. I know that France—like Germany, the United Kingdom and our other major colleagues in Europe—believes that the United States is right when it says that Europe must pull its weight better over defence. We agree. We agree with the United States and we agree with our European colleagues. We agree because it is the sensible, right and proper thing to do.
The noble Lord asked what would happen if we have committed our troops and we find that we need to commit them elsewhere. What would happen anyway if we had committed our troops and another conflict arose? We would take sensible decisions in the light of the prevailing circumstances. The United Kingdom Government will take those decisions. The noble Lord may shake his head, but that is the position. The decision will be taken by a British Prime Minister answerable to a British Parliament. It would not be done by qualified majority voting. It would be a decision for the Government of this country—and it would be a sensible one.
Lord Shore of Stepney: My Lords, my noble friend will accept—
Lord Burlison: My Lords, the Companion is quite clear. We have reached 20 minutes and we must end the debate.

Political Parties, Elections and Referendums Bill
6.8 p.m.
The Parliamentary Under-Secretary of State, Home Office (Lord Bassam of Brighton): My Lords, I beg to move that the Bill be now further considered on Report.
Moved, That the Bill be further considered on Report. —(Lord Bassam of Brighton.)
On Question, Motion agreed to.
Clause 114 [General restriction on referendum expenses]:
[Amendments Nos. 180 and 181 not moved.]
Clause 115 [Special restrictions on referendum expenses by permitted participants]:
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 182:
Leave out Clause 115.
The noble Lord said: My Lords, in moving Amendment No. 182, I shall speak also to Amendment No. 186. Amendment No. 182 seeks to leave out Clause 115 and Amendment No. 186 seeks to leave out Schedule 14.
We return to the question of referendum spending limits. It is no secret that, from the beginning, we have been very doubtful about—indeed we have opposed—the attempt to place spending limits on referendums. We feel that, whatever the referendum may be about, the attempt by the Government to impose these limits is an attempt to rig the expenditure on referendums. I suspect that their principal objective—they never look a year ahead when a month will do—is probably the referendum on the euro. But other referendums are likely. If the Liberal Democrats manage to persuade them, the Government may well hold a referendum on proportional representation.
The Government have chosen to attempt to impose spending limits by focusing on the political parties. That is not sensible. Some parties will be split on issues. Let us take, for example, a referendum on PR. I have no doubt that the Labour Party would be divided on PR, although I am not sure how even or uneven the division would be. I suspect that there are one or two members of the Conservative Party whose view might differ from that of the majority; however, I do not think the split would be anything like that in the Labour Party.
I have asked this question a number of times and I never receive an answer. Nevertheless, it is always worth asking again. On whose side of the argument would the Labour Party's £5 million fall—or would it be divided in some kind of proportion, perhaps based on the views of Members of another place or members of the National Executive Committee? I do not know. But what I do know is, whichever way the £5 million comes down in the Labour Party, many of its members will be very unhappy about their party spending £5 million on a campaign with which they do not agree.
Why should the level of the limit be decided in relation to the votes cast at the previous general election when, by definition, the referendum issue was not decided at the general election? Many of those who vote for a particular party at a general election—because they agree in general terms with its policies on health, home affairs or whatever—may not agree on the issue that the party takes up in a referendum. Yet their votes would count in determining spending on the opposite side to their opinions. That is not a very happy prospect. The point was raised by my noble friend Lord Lamont; and the noble Lord, Lord Goodhart, said that it was wholly wrong in principle to base the spending limits on votes cast at the previous general election.
My noble friend Lord Pearson, who is no longer in his place, raised the issue of why the spending limits in a referendum should not be determined by the votes in the most recent European parliamentary elections. Why not? There would seem to be some sense in that if the referendum was not on the euro. I can see that in relation to proportional representation the division of

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expenditure would be based on the proportion of votes in the previous British general election, but on the euro or any other issue relating to Europe that need not be the case. Let us assume that the Government decide to hold a referendum on matters that emerge from the Nice summit. In that case it is much more logical to base the expenditure on the European elections. The interesting point about the debates that we have had on this issue is that not a single Member of this House has spoken in favour of the Government's proposals—except the rather beleaguered noble Lord the Minister.
We could take as an example on a more limited scale the referendums that we have held. But let us take a referendum on the euro. The main pro-euro parties could spend £9 million to scrap the pound; the Conservative Party could spend only £5 million to save it. What would the Minister have said had he been at the wrong end of that stick all those years ago in the famous "village green" referendum which brought him into politics in the first place? What would his mother have said if she had been on the wrong end of the red rose? That is a jokey way to put it, but it is a serious point. Even the noble Lord admitted, on 24th October, that the Government freely conceded that their proposals would not ensure that each side in a referendum was subject to the same overall limit on expenditure, and that there was no pretence that their proposals were intended to create a level playing fiend in that sense.
If there is any argument about deciding expenditure on a referendum, it ought to be about creating a level playing field. In the Scottish referendum, a level playing field would certainly not have been created, because three of the parties were on one side and only one was on the other. I am sure that my noble and learned friend Lord Fraser, who was involved in that campaign, will agree with me when I say that, frankly, even if there had been a level financial playing field, I doubt whether the result would have been significantly different. However, no one can be in any doubt that if there had been a level playing field in expenditure in the referendum on Wales, the result would have been entirely different. The Government would have lost.
I should be happier if we were attempting to create an equality of arms when it comes to a referendum. However, I understand why the Government do not believe that that can be done. I have examined the issue carefully and I do not think it can be done either. Various groups who may agree on nothing else but the referendum will find it impossible to agree on how much of the cake they will individually spend. It would be almost impossible to keep the "Yes" side inside some global sum and the "No" side inside some global sum. The individual components would be very hard to discipline.
The Neill committee considered this whole question and decided that the task was impossible; it would be very difficult to agree. Any attempt to agree the two global expenditures would probably mean that the various organisations would be fighting like ferrets in a sack. My right honourable friend Sir George Young came to exactly the same conclusion in another place.
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So I do not think it is possible to look at a theoretically ideal solution: for example, £20 million for the "Yes" side and £20 million for the "No" side; that is the cap; and everyone taking part on one side or the other has to play inside that cap. That is not realistic. Therefore, at this stage I am not coming forward with an amendment to that effect. Our choice is either the option proposed by the Government, or that of the Neill committee—which is that if you cannot succeed in doing something you should not really try, because in the trying you will probably create more anomalies and difficulties.
Late last night, the Minister and I discussed a small amendment of mine. Out of it came the clear conclusion that, in any referendum campaign, if a rich person wants to go abroad, base himself in Brussels, Paris or wherever, and spend his money trying to influence one side or the other, there is absolutely nothing that can be done about it under the provisions of the Bill. At one time that may not have been a productive thing for people to do. But today they could buy advertising space in British newspapers—the noble Lord may tell me that I am wrong about this—and a run a campaign for the "Yes" side or the "No" side. They could most assuredly gain access to the e-world, set up websites and pour their messages in from outside Britain. They could certainly go to a Dutch post office and post papers to us all so that we received papers for one side or the other.
I do not think I am being unfair to the Minister when I say that he had no escape from the logic that I pursued last night, and I do not think that he has received any help from his officials today. On that assumption, I think that my proposition is right. We can forget about limits. I know that the Government are terrified about a Mr Sykes, whom I have never met. Frankly, Mr Sykes can simply move from Yorkshire to Brussels and get on with spending all the money that the Government fear he might spend in a campaign on the euro on what they see to be the wrong side. So all their efforts to put limits on campaigning will be totally set aside—they will be just nonsense.
The Neill committee unanimously considered that there should not be spending limits in referendum campaigns. The committee said that it would be futile, and possibly wrong. I think it would be futile. As I have explained, it would be fine if we could have globals on each side, but it would be wrong to do this in the way the Government intend, especially as we have exposed the fact that not just one coach and a set of horses could be driven through this provision, but coaches and horses. If spending limits cannot be imposed, why try?
I commend to the Government acceptance of my two amendments, which would at least mean that everything would be up front when we had a referendum and the different sides would be spending whatever they could spend and whatever they could find to spend. That is what will actually happen. Otherwise, we in Parliament will be made to look

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ridiculous because we will have passed a law which was incapable of being enforced. That is a very serious matter. I beg to move.
Viscount Cranborne: My Lords, I support my noble friend. I shall not repeat his arguments and propose to make one point. We are all aware that there is a powerful danger that the reputation for rectitude of our electoral arrangements is increasingly susceptible to attack. My noble friend Lord Mackay gave the example of the referendums on the Scottish and Welsh devolution proposals. I shall not venture into the arguments for and against pre-legislative and post-legislative referendums because they will not add to my point. However, in themselves they certainly open up any government who indulge in them to accusations of a kind that must undermine the reputation for neutrality of the administration of elections and referendums in this country.
As my noble friend made perfectly clear, the arrangements that the government propose in this Bill for the financing of referendums and the control of the way that they are financed will further undermine the reputation for fairness upon which consensus as to those rules must depend. When he responds, I earnestly beseech the Minister to consider whether what is now proposed will deliver yet another hammer blow to what is already a very dangerous tendency.
Because of their actions, those of us who believe that the Government effectively rigged the Welsh referendum—whether intentionally or not—are given an enormous amount of credibility when we make such an accusation. There is no doubt at all that those of us who will be fighting in referendums conducted under the rules proposed by the Government, if they are passed, will be able to say with absolute truth that the rules enabled one side to be given a huge financial advantage. For the reasons that my noble friend explained, that would apply especially in a referendum on the euro.
As the noble Lord, Lord Barnett, pointed out to the Minister in another context only yesterday, the results of elections are increasingly influenced by money. This is not a negligible affair. We are talking about the perceived probity and fairness of referendums, which, like it or lump it—I know that my noble friend Lord Mackay does not like it—are with us in some form or another for the foreseeable future. It would be doing an enormous service to the political life of this country if the Government were able to look us in the eye and say with reason, demonstrably with reason, that they are not passing a law which suggests that they are rigging the conduct of the most likely referendums within the next few years in their favour. If they do so, those of us on the receiving end of that action will be able to cry "Foul!". As we have seen from events in the United States, that does no one any good.
Lord Fraser of Carmyllie: My Lords, there was a time when I was young and slim and eager to advance in the law. There was no one's feet at which I would rather sit than those of the noble Lord, Lord Wedderburn. I note with interest that the noble Lord
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is present in the Chamber this evening. I am sure that he has been considering the argument advanced by my noble friend Lord Mackay. I shall have to determine which side of the argument to follow. However, if the noble Lord, Lord Wedderburn, were to say that my noble friend's argument did not meet with his approval, I suppose that I would retreat. But my deep suspicion is that he understands very well that what my noble friend has said is a serious and important aspect of the issue now under consideration.
If the noble Lord, Lord Wedderburn, wishes to rise to dispute what I say, I should be very much minded to depart from the position taken by my noble friend. However, I have been watching the noble Lord as this argument has developed and my deep suspicion is that the intellectual integrity for which he is famed is such that he will not find it easy to dispute the argument that my noble friend Lord Mackay has advanced.
Lord Wedderburn of Charlton: My Lords, the noble and learned Lord was once a devoted student at some of my lectures. However, he will have to do without one tonight.
Lord Bassam of Brighton: My Lords, that is a very good response.
We have long known that the Official Opposition were ill at ease with the provision that the Bill makes for spending limits in referendum campaigns, although I still do not fully understand the real reasons behind their objection. However, noble Lords opposite have clearly been in two minds up until now as to what to do about the situation, just as their colleagues were in another place: should they seek to remove spending limits altogether or should they seek to ensure that the limits are aggregate limits biting on each side as a whole in a referendum campaign?
The amendments now before the House answer that question in a curious way. They clearly appear to have come down in favour of removing the spending limits for "permitted participants". I am pleased that the noble Lord has now at least agreed that it would be impossible to impose a global limit on each side in a referendum. That seems to me to be a realistic point of view to have reached. When we debated the matter on earlier occasions there seemed to be a schizophrenia in the mind of the noble Lord and one that he appeared to share, in part, with the noble Lord, Lord Lamont. However, as I understand it, the amendments of the noble Lord, Lord Lamont, will not be discussed.
I suppose that the case I have to meet in respect of these amendments is as follows. If we cannot control what each side as a whole spends, what is the point of controlling what anyone spends? That is the essence of the argument behind these amendments. In a nutshell, we believe that it is just as useful—and we would say necessary—to control what each participant can spend in a referendum campaign as it is to control what each party can spend in an election campaign. The object served in both cases is to ensure that an organisation, or an individual, does not gain a preponderant voice simply by reason of the money at its, or his, disposal;

873
that is to say, the amount of money in the war chest. That is a useful object and I cannot see why anyone should oppose it—
Viscount Cranborne: My Lords, I am extremely grateful to the noble Lord for giving way. He is always most courteous at Report stage.
Let us take, for example, the euro referendum. If, let us say, the Liberal Democrats supported a "Yes" vote in such a referendum—which I suppose is at least possible—and the Government did the same, their combined funding would, therefore, be greater than that of the only party that opposed the euro; namely, my party. To use the noble Lord's argument, would that not mean that there would be a disproportionate amount of support for a "Yes" vote compared to that for a "No" vote?
6.30 p.m.
Lord Bassam of Brighton: My Lords, certainly that scenario is a possibility; I do not deny that. I am saying that it is better to have some control and some ability to contain the level of expenditure in a referendum of the nature that the noble Viscount, Lord Cranborne, mentioned rather than none at all. Part of the problem is that the noble Lord's assertion has been predicated on the assumption that the only referendum that is ever likely to see the light of day is a referendum on the euro. That is not necessarily the case. Although the spending limit—
Lord Mackay of Ardbrecknish: My Lords, whatever the subject of the referendum, there are three major parties in this country. Unless one of them splits its money—I refer to the sums of £5 million and £5 million—to one of those fives will be attached the Liberal Democrats' £3 million. That makes £8 million as opposed to £5 million. That is not a level playing field; it is unbalanced. If the noble Lord wants it to be balanced, he is simply falling at the first fence.
Lord Bach: My Lords, I intervene briefly before we progress too far. Questions for elucidation should be asked at Report stage. Noble Lords know well how to do that. As has already been acknowledged, my noble friend is generous in giving way. However, we all have to adhere to the rules for Report stage.
Lord Bassam of Brighton: My Lords, I have not argued that we are trying to create a level playing field. What I am trying to argue is that we should try to keep a sense of balance and proportion in the way in which we view referendum campaigns. I do not argue that we can create a perfect balance. I have made that point.
Moreover, as I said, the spending limits in the Bill cannot ensure that each side spends the same amount. As I have argued, they will help to do so. They will ensure that the governing factor is the number of organisations ranged on each side and not the amount of money which any one of them, or some of them, have available.
874
Having put the case positively in that way, I now feel entitled to put the negative case too. What is wrong with the spending limits in the Bill? Why are the Official Opposition so opposed to them? How would the Bill be improved if they were left out? I have not heard exactly how the Official Opposition envisage that that would improve the Bill. Here I draw, with due acknowledgement, on points made by the Liberal Democrat spokesman in another place, Mr Stunell. If it is a mischief that there is no overall control of aggregate spending on each side as a whole, one would make the position worse, not better, by removing the limits that the Bill provides.
Official Opposition spokesmen seem to talk as if the limits set by the Bill are in the nature of financial allowances, or perhaps even mandatory spending targets. As we have just heard, they then count up the organisations which they imagine will be ranged on one side and conclude that one side will necessarily have the edge. They may be right or wrong about that; no one can tell. However, the alternative is to allow a single individual or organisation on one side to outspend the totality of individuals or organisations on the other simply because they happen to have more money. We say that that cannot be right. That seems to be the dividing line between the Government and the Official Opposition on this issue.
I have no hesitation in advising the House that Clause 115 and Schedule 14 should stand part of the Bill and that Amendments Nos. 182 and 186 should be rejected. That is where the argument rests. That is the difference between the two sides in the argument. It appears to me that noble Lords opposite want to give up any system of control. I do not believe that that is right. I believe that we should have a system of control. We argue that that system should be the best that we can possibly achieve in the circumstances. That is the Government's case.
Lord Mackay of Ardbrecknish: My Lords, dear, dear, dear! I suppose there is one thing we must be grateful for; namely, that the noble Lord, Lord Bach, managed to prevent the Minister having to answer the question of whether £8 million is more than £5 million. That was a most unconvincing reply. The noble Lord accused me of being schizophrenic when I said that there were two options at earlier stages of the Bill and that we wanted to consider which might be preferable to governments. To base his case on that argument is weak indeed.
I am not schizophrenic. Is the Neill committee schizophrenic? Before we finally leave the issue I remind the noble Lord of what the Neill committee stated at paragraph 12.46 of its report. It stated:
"It appears to us that under these circumstances it would be impracticable to try to control campaign spending. The number of individuals and organisations involved would often be too large. The time-scale would often be too short … The administrative apparatus required would resemble one of Heath Robinson's most outlandish contraptions—and would almost certainly not work".
That is fine. Last night I think that I persuaded the Minister—because he did not answer me—that money would be spent from abroad over which the

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Government had absolutely no control. Here we have an attempt to impose limits which is, in my view, flawed—the Minister does not think that it is flawed — because it would not be equal. If the object is to achieve equality of arms, and the Government's proposals do not achieve that, surely the Government have failed in that regard. The Minister's answer seemed to be that the Government had failed to do that but wanted to place some controls on individual participants. The fact that—this is beginning to resemble the language used on the previous Bill we discussed—the balance may be heavily in favour of one side and not in favour of the other side at all is something that the Government will leave to one side.
Lord Bassam of Brighton: My Lords, I am not saying that we can achieve equality of arms. I have not argued that this evening. I am saying that we need to have some controls on the arms race. I accept that there is a difference there, but I argue that we need to have at least some controls. That is the Government's position.
Lord Mackay of Ardbrecknish: My Lords, but the other side of the argument on election spending is that we should have equality of arms between the two main parties. The Conservative Party and the Labour Party should have the same limits. It seems to me that equality of arms involves having the same limits. However, I leave that point because clearly the Minister has not even begun to address it. It is rather like sailing on the ocean in the fog in that one does not see the ship that passes five miles away, let alone worry about it. The Minister seems to take that view.
The point is that these limits could not be implemented. The Minister has not addressed the point that he made last night. It appears that, for the Minister, last night's proceedings did not take place. However, they did take place. I know that because I was present until a late hour. I have read the proceedings in Hansard. The Minister said rather amusingly that I was in danger of becoming an ace loophole spotter, a sort of green ink merchant of the loophole territory. That suggested to me that I had found a fairly large loophole in the Bill. He did not deny that for a minute.
Here we have a situation where the Minister is saying, "This is the best we can do and we think that you should accept it". If it cannot be implemented in reality, we should not pass legislation. This matter is important. I shall not attempt to argue my case further because I shall not engage the Minister in any discussion. He will simply stick by his brief. I am tempted to try what I used to call the "Hollis trick" which is to lean over and say to the Minister involved, "You are the Minister. They are the officials. Forget that the brief states 'Reject' and change that to 'Accept' if you think that the argument is worth it". I do not even think that that will work with the Minister. Therefore I seek the opinion of the House.
6.39 p.m.
On Question, Whether the said amendment (No. 182) shall be agreed to?
Their Lordships divided: Contents, 80; Not-Contents, 154.

Division No. 1

CONTENTS

Astor of Hever, L.

Lucas, L.

Attlee, E.

Lyell, L.

Beaumont of Whitley, L.

McColl of Dulwich, L.

Blackwell, L.

Mackay of Ardbrecknish, L.

Blatch, B.

Mancroft, L.

Boardman, L.

Marlesford, L.

Brougham and Vaux, L.

Marsh, L.

Byford, B.

Monro of Langholm, L.

Campbell of Cray, L.

Monson, L.

Carnegy of Lour, B.

Mowbray and Stourton, L.

Coe, L.

Moynihan, L.

Colwyn, L.

Naseby, L.

Courtown, E.

Noakes, B.

Cranborne, V.

Northesk, E. [Teller]

Crathorne, L.

Norton of Louth, L.

Crickhowell, L.

O'Cathain, B.

Dean of Harptree, L.

Onslow, E.

Dixon-Smith, L.

Palmer, L.

Eccles of Moulton, B.

Park of Monmouth, B.

Elliott of Morpeth, L.

Pearson of Rannoch, L.

Elton, L.

Peel, E.

Ferrers, E.

Platt of Writtle, B.

Forsyth of Drumlean, L.

Plummer of St. Marylebone, L

Fraser of Carmyllie, L.

Rawlings, B.

Gardner of Parkes, B.

Reay, L.

Glentoran, L.

Renton, L.

Goschen, V.

Roberts of Conwy, L.

Gray of Contin, L.

Rogan, L.

Greenway, L.

Sandwich, E.

Hanham, B.

Seccombe, B. [Teller]

Harris of High Cross, L.

Selsdon, L.

Henley, L.

Stewartby, L.

Hodgson of Astley Abbotts, L.

Strathclyde, L.

Hooper, B.

Taylor of Warwick, L.

Howe, E.

Thomas of Gwydir, L.

Howell of Guildford, L.

Trefgarne, L.

Kingsland, L.

Trumpington, B.

Knight of Collingtree, B.

Vivian, L.

Laird, L.

Wilcox, B.

Lawson of Blaby, L.

L. Young, B.

NOT-CONTENTS

Acton, L.

Brooks of Tremorfa, L.

Addington, L.

Burlison, L.

Ahmed, L.

Carter, L.[Teller]

Alderdice, L.

Clarke of Hampstead, L.

Amos, B.

Clement-Jones, L.

Andrews, B.

Clinton-Davis, L.

Archer of Sandwell, L.

Cocks of Hartcliffe, L.

Bach, L.

Cohen of Pimlico, B.

Barker, B.

Crawley, B.

Barnett, L.

David, B.

Bassam of Brighton, L.

Davies of Coity, L.

Berkeley, L.

Davies of Oldham, L.

Bernstein of Craigweil, L.

Dean of Thornton-le-Fylde, B.

Billingham, B.

Desai, L.

Blackstone, B.

Dixon, L.

Blease, L.

Donoughue, L.

Bradshaw, L.

Dubs, L.

Bragg, L.

Elder, L.

Brennan, L.

Elis-Thomas, L.

Brett, L.

Evans of Parkside, L.

Brooke of Alverthorpe, L.

Evans of Watford, L.

877

Ezra, L.

Mar and Kellie, E.

Falconer of Thoroton, L.

Mason of Barnsley, L.

Falkland, V.

Massey of Darwen, B.

Farrington of Ribbleton, B.

Merlyn-Rees, L.

Faulkner of Worcester, L.

Miller of Chilthorne Domer, B

Filkin, L.

Mitchell, L.

Fyfe of Fairfield, L.

Molloy, L.

Gale, B.

Morgan, L.

Gibson of Market Rasen, B.

Morris of Castle Morris, L.

Gladwin of Clee, L.

Morris of Manchester, L.

Goldsmith, L.

Newby, L.

Gordon of Strathblane, L.

Nicol, B.

Goudie, B.

Northover, B.

Gould of Potternewton, B.

Oakeshott of Seagrove Bay, L.

Grabiner, L.

Phillips of Sudbury, L.

Graham of Edmonton, L.

Prys-Davies, L.

Greaves, L.

Ramsay of Cartvale, B.

Greengross, B.

Rea, L.

Grenfell, L.

Redesdale, L.

Hamwee, B.

Rennard, L.

Hardy of Wath, L.

Renwick of Clifton, L.

Harris of Greenwich, L.

Richard, L.

Harris of Haringey, L.

Rodgers of Quarry Bank, L.

Harrison, L.

Roper, L.

Hayman, B.

Russell, E.

Hilton of Eggardon, B.

Russell-Johnston, L.

Hollis of Heigham, B.

Sainsbury of Turville, L.

Howells of St. Davids, B.

Sandberg, L.

Howie of Troon, L.

Scotland of Asthal, B.

Hoyle, L.

Scott of Needham Market, B.

Hughes of Woodside, L.

Sharp of Guildford, B.

Hunt of Kings Heath, L.

Shore of Stepney, L.

Islwyn, L.

Shutt of Greetland, L.

Jacobs, L.

Simon, V.

Janner of Braunstone, L.

Smith of Clifton, L.

Jay of Paddington, B. (Lord Privy Seat)

Smith of Leigh, L.

Strabolgi, L.

Jeger, B.

Symons of Vernham Dean, B.

Jenkins of Putney, L.

Taverne, L.

Kennedy of The Shaws, B.

Taylor of Blackburn, L.

King of West Bromwich, L.

Thomas of Walliswood, B.

Kirkhill, L.

Tomlinson, L.

Layard, L.

Tordoff, L.

Lea of Crondall, L.

Turnberg, L.

Lester of Herne Hill, L.

Uddin, B.

Lipsey, L.

Varley, L.

Lockwood, B.

Walker of Doncaster, L.

Lofthouse of Pontefract, L.

Wallace of Saltaire, L.

Macdonald of Tradeston, L.

Walmsley, B.

McIntosh of Haringey, L. [Teller]

Warner, L.

Wedderburn of Charlton, L.

McIntosh of Hudnall, B.

Whitaker, B.

MacKenzie of Culkein, L.

Whitty, L.

Mackenzie of Framwellgate, L.

Wilkins, B.

Mackie of Benshie, L.

Williams of Crosby, B.

McNally, L.

Williams of Mostyn, L.

Maddock, B.

Young of Old Scone, B.

Resolved in the negative, and amendment disagreed to accordingly.
6.48 p.m.
[Amendment No. 183 not moved.]
Schedule 14 [Limits on referendum expenses by permitted participants]:
[Amendments Nos. 184 to 186 not moved.]
Clause 116 [Control of donations to permitted participants]:
[Amendment No. 187 not moved.]
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 188:
Page 84, line 33, at end insert —
("() Notwithstanding anything in Schedule 15 or Part IV, a permitted participant shall be prohibited fromaccepting during a referendum period any donation from a permissible donor of the type specified in section 52(2)(c).").
The noble Lord said: My Lords, I have to take cognisance of the last Division and the fact that we now have the rigged expenditure provision in the Bill and are unlikely to be able to take it out. I now want to consider how that works and to tease from the Minister that some twists in it are perhaps less than fair and honest.
In another place at the Second Reading of the Bill the Home Secretary said:
"The Liberal Democrats are offered generous spending limits in the Bill, but it is a racing certainty that the party will not be able to raise money to the level of the spending limit. So to argue that spending by the Labour and Liberal Democrat parties will be nearly equal because both parties will be able to spend up to a maximum amount fails to take into account the capacity of parties to raise money up to the maximum".—[Official Report, Commons, 10/1/00; col. 38.]
I remind the Liberal Democrats what their friend the Home Secretary thinks about their ability to raise £3 million.
Let us assume that after the next election the Liberal Democrats still have a £3 million limit. Clause 52(2)(c), which I have already tried to delete, allows one political party to donate to another. I assume that the Labour Party would have more than £5 million available to spend on any referendum on the euro. To maximise the pro-euro spending, Labour would be able to give some of its surplus to its Liberal Democrat allies. We all know from Mr Ashdown's diaries about the close relationship between the two parties. The Minister admitted as much on 24th October, when he said:
"The noble Lord"—
I think that that means me —
"clearly had in his sights the possibility that in a referendum on the euro the Labour Party, having set aside £5 million for its own campaign, might contribute to the campaign of the Liberal Democrats. I entirely accept that that is a theoretical possibility. … Such a move would not necessarily be contrary to the letter of the provisions in Part VII".—[Official Report, 24/10/00; col. 185.]
In Committee, I proposed a ban on parties donating to other parties to stop them acting in concert to take advantage of the limits—I was going to call them rigged limits but I shall say that they are slightly out of balance. The Minister had concerns about that, pointing out to me that the Labour and Co-operative parties might want to donate to each other. As we all know, they are pretty well one party. I do not know why money should go from one party to another, but I have conceded that point to the Minister. He has got one up there.
Later on in Committee I proposed a ban on parties using money given by other parties to fund referendum campaigns. The Minister told me that it was difficult, if not impossible, to control the uses to which particular money was put. I therefore concede that point for the purposes of today's debate. The amendment would

879
allow the Labour Party to receive as much money as it could from the Co-operative Party—or, indeed, to give as much money to the Liberal Democrats, such is my generosity. It would not even stop them using that money for a referendum campaign. To that extent the amendment is not nearly as watertight as I would like. However, it would stop parties donating to other parties during the period of a referendum. That would be the time when a political party might find that it was going to underspend because it could not raise enough money and would then go cap in hand to its wealthier cousin—in this case the Labour Party—and say, "Help. We thought that we would get enough money to fund the campaign but we are not going to get near our maximum. Can you top us up?" The amendment would stop that.
The amendment meets all the concerns that the Minister raised in earlier debates. He can hardly plead in his defence that it is not watertight because on the previous amendment he said that it did not matter that the Bill was not watertight. He cannot change sides on the issue of watertight provisions.
As the amount of money that a party is allowed to spend is related to its vote at the previous election, it is a bit odd that parties should be able to pool their money when they spend it, as if their separate votes did not matter.
The euro is not the only issue. The problem could arise during a referendum on any issue. If we are to have limits—the Minister has clearly got his way on that—they should be as fair in their operation as possible. The scenario that I have outlined would not be fair. I accept that the amendment would not entirely prevent unfairness, but it would go a long way to prevent it during a referendum campaign. I beg to move.
Lord Richard: My Lords, before the noble Lord sits down—I know that he has, but let us assume that metaphorically he is still on his feet—I should like to put one point to him. I listened to him with great interest. His complaint is not that the Labour Party might donate money to the Liberal Party but that the Liberal Party would not accept money from his party if he wanted to give some. The noble Lord seems to assume that there is a permanent alliance between the Liberals over there and the Labour Party over here and that we should be treated as one party. On the voting record of the past Session, that is not axiomatic.
Lord Mackay of Ardbrecknish: My Lords, I think that I probably now have to interrupt the noble Lord's speech before he sits down. If the Liberal Party and the Conservative Party were on the same side in a referendum and the Labour Party were on the opposite side, the Bill would allow the same scenario. Even in those circumstances, it would not be fair.
Lord McNally: My Lords, when I attended school dances, I used to look enviously at the prettiest girl in
880
the room, who sat there smugly knowing full well that all the boys wanted to dance with her. I am beginning to feel like that girl this evening.
Lord Monson: My Lords, will the Minister confirm that, as the Bill stands, the Labour Party could give money to parties with which it is normally at loggerheads, such as the Scottish nationalists and the Welsh nationalists, for the specific purpose of winning a referendum vote on the euro?
Lord Bassam of Brighton: My Lords, the noble Lord, Lord Mackay, has described his amendment perfectly, so I shall not repeat its intent. His particular concern is that, in addition to spending up to its own limit, the Labour Party might contribute to another political party's campaign. I have been in the Labour Party for 20 years or so. I do not have the longest membership of the Labour Party, but 20 years is not a short time. I have been involved in some pretty hairy debates in that time. I remember the ghastly years when we had the militant tendency in our midst I also remember some rather more halcyon years. I cannot remember any Labour Party general management committee or branch meeting debating the merest possibility that we mightwant to make a donation to another political party. I have heard some pretty weird debates in the Labour Party during that time, as well as some interesting and exciting ones, but I have never heard anyone argue that we might want to give money to the Liberals. That would have been a very strange argument. I am puzzled by the noble Lord's attempt to tie us in with our friends on the Liberal Democrat Benches at this stage in our development as a political party. Technically the noble Lord, Lord Monson, is right, but practically what he suggests is a non-runner.
I do not like to say so, but the noble Lord, Lord Mackay, seems to be having some good fun with his amendment and making a slightly mischievous point. The amendment emerged because he did not seem to understand earlier in our debates that some of us in the Labour Party could also be members of the Co-operative Party. I have two party cards. One tells me that I am a member of the Co-operative Party and the other tells me that I am a member of the Labour Party. That is the eventuality that the Bill permits. It is not about trying to top up another party with extra resources in the event of a referendum on the euro. The noble Lord needs to be disabused of that.
We have had the argument before. I am not convinced that the noble Lord is being entirely serious. Technicallyhe is right that there is a possibility, but in reality it will not happen.
7 p.m.
Lord Mackay of Ardbrecknish: My Lords, I was interested to see the Minister brandish membership

881
cards for the Labour Party and the Co-operative Party. This is the Minister who, about 30 minutes ago, accused me of being schizophrenic.
Lord Bassam of Brighton: My Lords, the two are entirely compatible.
Lord Mackay of Ardbrecknish: My Lords, I am glad about that.
This has been an interesting debate. The noble Lord has often said at the end of debates that the point that I have made is right but that it is so theoretical that it would not happen. In my view, to say, "Yes, there is a loophole; yes, there is a way round it; yes, there is a way through it. But don't worry, it is only theoretical", is an extraordinarily unsatisfactory way to leave legislation. Perhaps I may suggest to the noble Lord that he talks to some of his colleagues on the Treasury team. They will tell him that they spend most of their waking hours trying to ensure that even the most theoretical loophole in finance legislation has been closed; otherwise, a whole army of accountants will lead a whole army of people through that loophole. That is true in relation to finance legislation and it is also true in relation to all other legislation.
This is not a satisfactory position. However, I shall not divide the House on this amendment. I say simply that I shall take it as a statement on behalf of the Labour Party that there is no circumstance under which it would pass money to the Liberal Democrat Party. That is what the Minister has just said. I shall rest my case on that if at any time in the future an attempt is made to do what I have theoretically suggested is possible. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 189 not moved.]
Schedule 15 [Control of donations to permitted participants]:
Lord Bach Lord Bach moved Amendments Nos. 190 and 191:
Page 187, line 25, leave out ("(2)(d)") and insert ("(1)(d)").
Page 187, line 27, leave out ("(2)(e)") and insert ("(1)(e)").
On Question, amendments agreed to.
[Amendment No. 192 not moved.]
Lord Bach Lord Bach moved Amendments Nos. 193 and 194:
Page 189, leave out lines 38 to 47.
Page 189, line 47, at end insert —
("(2A) For the purposes of this Schedule, any relevant donation received by a permitted participant which is an exempt trust donation shall be regarded as a relevant donation received by the permitted participant from a permissible donor.
(2B) But, for the purposes of this Schedule, any relevant donation received by a permitted participant from a trustee of any property (in his capacity as such) which is not —

(a) an exempt trust donation, or

882

(b) a relevant donation transmitted by the trustee to the permitted participant on behalf of beneficiaries under the trust who are —

(i) persons who at the time of its receipt by the permitted participant are permissible donors falling within section 52(2), or

(ii) the members of an unincorporated association which at that time is such a permissible donor,

shall be regarded as a relevant donation received by the permitted participant from a person who is not such a permissible donor.").
On Question, amendments agreed to.
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 195:
Page 190, line 6, leave out ("not less") and insert ("more").
On Question, amendment agreed to.
Lord Bach Lord Bach moved Amendment No. 196:
Page 191, line 16, leave out ("(2) to (10)").
On Question, amendment agreed to.
[Amendment No. 197 not moved.]
Clause 117 [Returns as to referendum expenses]:
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 198:
Page 85, line 16, leave out ("and") and insert ("or").
On Question, amendment agreed to.
Clause 122 [Restriction on publication etc. of promotional material by central and local government etc.]:
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 199:
Page 87, line 30, leave out ("relevant") and insert ("referendum").
The noble Lord said: My Lords, in moving Amendment No. 199, I wish to speak also to Amendments Nos. 204 and 205. I tabled this amendment in Committee. I and my noble friends want to return to it simply because we did not leave it in a happy position. Amendment No. 204 is consequential on Amendment No. 199, and Amendment No. 205 is an attempt at some form of compromise.
I keep trying to find a form of compromise with the Government but I keep getting knocked back by the noble Lord, Lord Bassam. I cannot really complain because two or three of my amendments have been accepted. However, I put forward a compromise in the Bill that we dealt with earlier today and the noble and learned Lord, Lord Falconer, accepted it. Perhaps the noble Lord might follow his noble and learned friend's example.
This group of amendments deals with the "purdah period" which will apply to most, but not all, campaigning activity by the government of the day during the last 28 days of a referendum campaign. We had an interesting debate about this in Committee and there were also some good and interesting debates in the other place.
Essentially, the question is this: is it right and fair for the government of the day to be allowed to use unlimited amounts of public money to campaign for

883
one side of the argument in a referendum, especially in the context of the spending restrictions that we have just agreed which will apply to everyone else who campaigns in that referendum?
In its report, the Neill committee took a very dim view of government participation in referendum campaigns. It cited the Scottish, Welsh and Northern Irish referendums held by this Government as having been influenced by partisan propaganda issued at the taxpayers' expense. It rejected that approach completely and said at paragraph 12.41 of the report:
"We believe it is perfectly appropriate for the government of the day to state its views and for members of the Government to campaign vigorously during referendum campaigns, just as in general election campaigns. But we also believe that, just as in general election campaigns, neither taxpayers' money nor the permanent government machine—civil servants, official cars, the Government Information Service, and so forth—should be used to promote the interests of the Government side of the argument".
At paragraph 12.44, the committee concluded:
"We believe that it is extraordinarily difficult, if not impossible, for the government of the day to offer purely objective and factual information in the course of a referendum campaign. We believe governments should not participate in referendum campaigns in this manner … The government of the day in future referendums should, as a government, remain neutral and should not distribute at public expense literature, even purportedly factual literature, setting out or otherwise promoting its case".
That is pretty clear. However, I believe that it probably set alarm bells ringing in Millbank, the Home Office and even Downing Street. Therefore, we have a Bill which does not reflect those sentiments at all. In fact, it allows for the situation that the Neill committee said should be prohibited; namely, government propaganda issued at public expense during referendum campaigns.
I admit that the Government have provided for the 28-day purdah period in the Bill, although to what extent it is a real purdah we shall examine in the next group of amendments. However, the referendum campaign can last for up to six months. The political parties and other campaign organisations will be subject to strict rules on expenditure for the whole of that period, whereas the government of the day can spend what it likes for up to five out of a possible six months.
I know that the Neill committee welcomed the 28-day period. I know that it was welcomed by my right honourable friend John MacGregor in another place. It is possible that the committee did not imagine that, given what they did in the devolution referendums, the Government would ever have agreed to any purdah period at all. Perhaps the committee was pleasantly surprised. I am not sure whether the noble Lord, Lord Goodhart, is intending to intervene in this debate and to give us his views.
However, what the Government have done clearly deviates from the spirit and the letter of the Neill recommendations. I also consider it to be grossly unfair and yet another attempt to rig future referendums. For five months, when other organisations, including the political parties, are subject to spending restrictions, the government of the day can issue unlimited amounts of partisan material
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at public expense, use the government press machine and take out adverts in newspapers, all with taxpayers' money and all designed to influence the outcome of the referendum.
I believe that purdah should apply during the whole referendum period. I consider that to be fair and equitable. That is what Amendments Nos. 199 and 204 seek to achieve. In Committee, the Minister argued that we could not apply the purdah during the whole referendum period because that could also cover the passage of the Bill through Parliament. I do not believe that it is beyond the wit of the Government's draftsmen and the Minister's officials to devise wording to meet that point. It was a fig leaf provided for the Minister to cover his embarrassment.
In a spirit of generosity, I have tried to meet the point with Amendment No. 205. It is not my preferred option but it would at least limit the scope for abuse. The purdah period would be either 28 days or half the referendum period, whichever was longer. That would at least mean that for half the referendum period the Government could not distribute propaganda, but it would not affect the passage of the Bill through Parliament. In any event, I believe that proposal to be better than what is in the Bill.
I remind the noble Lords, Lord McNally, Lord Rennard and Lord Goodhart, that in another place the Liberal Democrat Front Bench spokesman, Mr Stunell, whom I have quoted before, supported our call for the purdah period to be increased. He said:
"I would not be averse to an extension of the 28 days … I come part way with the hon. Member for Beaconsfield on bringing forward the 28-day deadline. I am sympathetic to that view". — [Official Report, Commons, 16/2/00; col. 1054].
However, I believe that Mr Stunell completely misunderstood the effect of the amendments, which are the same as those before your Lordships today because he thought, mistakenly, that they would remove the purdah period entirely rather than extend it to the whole referendum period which would he their actual effect. I know that noble Lords on the Liberal Benches, if they speak, will not make that mistake with regard to the amendments before us today.
This is an important issue. We are trying to ensure that future referendums are not rigged. The Government are going against the spirit and letter of the Neill report in that respect. The amendment in the name of my noble friend Lord Willoughby de Broke is thoroughly sensible. If it is not acceptable to the Government and to your Lordships, I commend my compromise Amendment No. 205 to the House. I beg to move.
Viscount Cranborne: My Lords, I rise to support my noble friend in what he said. I have only one question for the Government. Referring back to earlier remarks I made today, when the Minister replies, perhaps he will address himself to what is perceived on many sides of the House to be a real and growing danger; namely, that the equity with which referendums will be conducted in the future will be as liable to challenge as the Welsh and Scottish referendums were liable to challenge.

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If that is a growing worry, which I assure him it is—not only within this House but elsewhere—and if it is a worry which has been acknowledged by the noble Lord, Lord Neill, and his committee, do the Government also acknowledge that and are they prepared to answer it in detail? If not, why not?
Lord Bassam of Brighton: My Lords, the Official Opposition have put their names to two proposals which are alternatives to each other as well as to what is in the Bill. Amendments Nos. 199 and 204 would remove the idea of a "relevant period" from Clause 122. On the other hand, Amendment No. 205 would retain the expression but redefine it.
The effect of the first two amendments would be that the period during which the government of the day cannot spend money on promotional material would not be the 28 days prior to the poll but a longer period, beginning, in most cases, when an order is made. The order would normally be made around the time of the introduction or Second Reading of a Bill for a referendum. I acknowledge that it is at that earlier point that spending controls on referendum participants will begin to bite.
The alternative amendment, Amendment No. 205, would have the effect of taking back the commencement of the embargo to a point half way between when the order is made and when the poll is held. I wish to persuade the House that neither of the amendments is necessary or desirable and that the right course is to stick at 28 days.
The mischief with which the Bill seeks to deal here, if "mischief' is not too strong a word, is of a government putting round partisan material at the public's expense at the time when the electorate is thinking about the issue and making up its mind how to vote. The Neill committee thought that the distinction between factual and promotional material, which had been relied on in some cases, was unsound. We do not necessarily accept that that was so in the cases referred to, but we came to the conclusion that the right response was "no contest".
The Neill committee did not itself propose a precise time-limit. But we concluded that what was needed was a simple, straightforward rule; and in another place a member of the Neill committee, Mr MacGregor, acknowledged, as the noble Lord, Lord Mackay, said, that the Government's proposal met the committee's point.
One important thing to recognise about the proposal in the Bill—and I dare say we will come back to this on the next group of amendments—is how far-reaching it is. It is not simply an embargo on partisan or overtly promotional material. The prohibition applies equally to general information and to material which deals in any way with issues raised by the referendum question.
That being so, it would simply be unreasonable to apply the embargo to the period in which the Bill for the referendum is actually going through Parliament. During that time, the government of the day are not
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acting as a campaign group but as a government. They are putting a proposal to Parliament which they must explain and back up in the usual way. One might as well say that a government cannot issue material in connection with any Bill during the period running up to a dissolution of Parliament and a general election, because in due course they will want to take credit for the legislation that they have carried through and stand on policies which it contains.
For those reasons, we are opposed to both of the alternative schemes now put forward. Amendment No. 205 is, obviously, milder in its effects than Amendments Nos. 199 and 204. But it is scarcely less objectionable, because it still involves the risk of preventing the government of the day from acting as a government at the time when they have every right— and some would say a duty—to do exactly that govern.
The point has been made, in favour of the amendments, that spending limits for referendum campaign groups will be effective from the beginning of the "referendum period" so why should the government not be subject to similar restrictions? I shall leave aside the obvious and perhaps rather crude point that, if the Official Opposition had their way, there would be no spending limits. But I will make two other points. First, although the "referendum period" will begin quite early on—as it has to if the electoral commission is to designate umbrella organisations and so on—the actual political campaign will not really get under way until some time later. Whichever party then forms the Opposition, for example, will no doubt be concentrating its energies at the earlier stage on opposing the Bill in Parliament.
Secondly, there is no real equivalence between a spending limit and an absolute embargo. The embargo is not a spending restriction but a statement of what is or is not the proper role of a government during a referendum campaign. And by referendum campaign we mean, as the Neill committee did, the campaign in the country and not the process of a government taking a Bill through Parliament.
We have put a strong, perhaps even generous, self-denying ordinance into the Bill in response to the Neill report. The thought has crossed my mind, not for the first time on this Bill, that perhaps the Opposition cannot believe their luck. They are clearly, by putting forward alternative amendments, testing how far the House is prepared to go. The Government's clear view is that the Bill is perfectly satisfactory on this point and that no amendment needs to be made.
The noble Viscount, Lord Cranborne, asked whether we are worried about inequities which might occur in referendum campaigns. In a sense, what I have said addresses that issue. Of course, we recognise that it is an issue of concern and it was an issue of concern for the Neill committee. For those reasons, we have constructed the framework which we have placed on the face of the Bill. That is the Government's view.
7.15 p.m.
Lord Mackay of Ardbrecknish: My Lords, I noted that the Minister said that those restrictions on

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government were neither necessary nor desirable. They may not be desirable from the Government's point of view but I believe that they are extremely necessary from the point of view of having fair referendums. That is what we are supposed to be achieving.
I understand the point about Amendments Nos. 199 and 204: that during that period, it is possible that the legislation might still be going through Parliament. But I do not believe that that criticism can be levelled at Amendment No. 205, which is my compromise attempt to find a way to get round the Government's problem. Therefore, I am much more in favour of the compromise in Amendment No. 205. Whatever the noble Lord says, it remains a fact that everybody bar the Government will have some limit placed on their expenditure. For a fair amount of time, the Government will have unlimited expenditure; and it is expenditure which they do not have to raise from the people who want to vote "yes" or "no". They will raise that money from the taxpayers—from those who want to vote "yes" and those who want to vote "no". That is what is unfair about it.
While I shall withdraw Amendment No. 199 and not move Amendment No. 204, when we come to Amendment No. 205, I shall test the opinion of the House.
Amendment, by leave, withdrawn.
[Amendment No. 200 not moved.]
The Deputy Speaker (Lord Ampthill): My Lords, the noble Lord, Lord Mackay, will be aware that, if this amendment is agreed to, he cannot move Amendment No. 202. He has pre-empted himself.
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 201:
Page 87, line 42, leave out paragraph (d).
The noble Lord said: My Lords, we shall see how we get on. If the success of this amendment pre-empts the other amendment, I shall be more than happy for the Government to accept this in order to stop me dividing later on.
Amendment No. 201 is in the same vein and it is grouped with Amendment No. 202. We have just discussed the purdah period. This amendment is a variation inside the purdah period. There are things that the Government will be able to do throughout the referendum campaign, including the 28-day purdah period. The first three of these exceptions have attracted little comment. Indeed, they seem for the most part to be unexceptionable exceptions, though I am a little concerned about whether the Government may prompt people to seek information in order to be able to issue more propaganda under Clause 122(3)(a).
The fourth and final exception to the issuing of referendum propaganda at public expense is the issue of press notices. The drafting of Clause 122(1) allows such exempt press notices to contain anything that is listed in that subsection, including putting arguments for or against answers to the referendum questions. That has sparked some debate in your Lordships'
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House and in another place. Government Ministers will be able to issue government press releases and presumably use the government information service and government press officers to campaign, right up to polling day, for or against a particular referendum option.
In Committee on 24th October, I specifically asked the Minister whether the government of the day would be allowed, on the basis of such press notices, to use the government information service, civil servants and government press officers to brief the press during the purdah period. He failed to respond. I would like him to do so today.
There is also an issue about whether these documents will be made available to the public at large, perhaps via the Internet. The Minister will know that his own press releases, those of other Home Office Ministers and those of all government Ministers are placed on the Internet for all to see. To that extent, they are not press notices. They are in fact public notices. In Committee, the Minister said:
"A 'press notice' is a notice to the press, not to the general public".—[Official Report, 24/10/00; col. 208.]
I will remind him of that again, because I think it is very important. He said:
"A 'press notice' is a notice to the press, not to the general public".—[Official Report, 24/10/00; col. 208.]
That is not quite true. The definition has been overtaken by events in the intervening period. I have little doubt that the Minister and his officials will have read in detail the recent judgments of the noble and learned Lords, Lord Bingham of Cornhill and Lord Steyn, in the case of Turkington and Others v. Times Newspapers Limited (Northern Ireland), which were delivered in this House on 2nd November, a week after the Minister made his statement.
From the look on the Minister's face, I suspect that he has not had his attention drawn to that case. The noble and learned Lords clearly stated in those judgments that a meeting which was described by its organisers as a "press conference" fell within the definition of a "public meeting" in the Northern Ireland Defamation Act 1955. In his judgment, the noble and learned Lord, Lord Bingham of Cornhill, said:
"A press conference, attended by members of the press and perhaps other members of the public, has become an important vehicle for promoting the discussion and furtherance of matters of public concern, and there is nothing in the nature of such a conference which takes it outside the ordinary meaning of 'public meeting'".
If, as the noble and learned Lords and the Judicial Committee of this House have said in their judgments, a "press conference" falls within the ordinary meaning of a "public meeting", cannot a "press notice" also be a "public notice", especially if it is put on the Internet for all to see? I am sure that the Minister's brief has been revised in the light of that judgment. I hope that he will address the point.
I am extremely suspicious of this provision in the Bill and how it will be used. I would prefer to delete press notices from the exception. However, I recognise that the Minister may well deploy some argument

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against that. As usual, therefore, I have a compromise amendment in reserve. If the Minister believes that there are circumstances in which press notices may be issued entirely innocently during the purdah period, Amendment No. 202 would stop the issue of openly partisan press notices which attempt to influence the referendum result.
In this group of amendments, I have not only met the Minister's concerns but I have anticipated that he may raise new concerns and have tried to cover them. However, my concerns remain. I believe that my case has been hugely advanced by the judgments delivered in your Lordships' House. I look forward to what the Minister has to say about them. I believe that this point is as serious as the point relating to extending the purdah period. In fact, it may be more serious. I am aware that, via the Internet, government departments daily issue many press notices which could be openly reported. Anybody can access these websites—that is what they are there for. It seems to me that, in those circumstances, the Government will be communicating directly with the public. I believe that stopping this during the purdah period may be even more important than extending the purdah period. I beg to move.
Lord Marsh: My Lords, I recognise that much of the argument that I propose to advance in relation to Amendment No. 203— Is this the amendment that we are on?
Lord Bach: My Lords, I thought the noble Lord wanted to speak to this group of amendments.
Lord Marsh: No, my Lords.
Lord Bach: My Lords, I apologise to him.
Lord Marsh: My Lords, then it would probably be sensible if I did not pursue Amendment No. 203. I am deeply disappointed with the reaction of the Government. Nonetheless, on second thoughts, I think I will pursue it—I am taken rather by surprise by this turn of events—because I believe that this is a major and fundamental issue.
Lord Bach: My Lords, Clause 122 is designed simply to deal with the point raised by the Neill committee that the government of the day should not circulate material at the public expense in the run up to an election. As we understand it, it is not designed to prevent the government of the day from operating as such or from expressing views. The clause clearly contemplates the possibility of the government of the day responding to inquiries about their views and policies. As I understand it, no one challenges that. If an issue arises on which the Government, and not merely the party of government, are challenged, they ought to be able to respond. The press notice provides one means of doing so. It would be absurd if, in those circumstances, all the Government could say was "No comment".
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The Official Opposition have tabled two alternative proposals, and the noble Lord has spoken with that in mind. The effect of his Amendment No. 201 would be to remove the protection that paragraph (d) gives to press notices as against the general prohibition on the issue of material which Clause 122 sets up. His Amendment No. 202 would make it possible for some sorts of press notices to be issued, but not others. We believe that he is wrong in both amendments.
By Clause 122, we attempt to prevent a government from seeking to push, at the public's expense, material which relates in any way to a referendum campaign. We do not seek to prevent the government of the day from operating as governments do. Governments deal with issues as they come up. They express opinions, just like oppositions and other parties. For example, the clause does not prevent a government from responding to inquiries, including inquiries about policy. No one seems unhappy about that. If a government simply issue a succession of press notices which do nothing except repeat their view on the referendum question, two things will happen. First, they will be in breach of the internal government rules, because they will be using the government machine to promote a political object. Secondly, they will make themselves quite absurd, and the press will have a great deal of fun with it. There could be circumstances in which issuing a press notice might be reasonable and right for a government to do, but in which either of the amendments before the House, if passed, would prevent them from doing.
Let us suppose, for example, that in the run-up to a referendum on the single currency some violent movement occurs in the international value of the euro; or perhaps a statesman abroad makes a statement about the issue which seems to put a different light on the matter from what the Government had been saying. The question arises whether it still makes sense for the United Kingdom to join the single currency. The Opposition would gleefully seize on the point and capitalise on it, and there would be nothing to prevent them from so doing. But the government of the day, if either of the amendments is carried, would be unable to address the issue. They would be required to refer the matter to their party to deal with, notwithstanding that the issue may be a matter on which only the Government have the necessary information.
We think that that is a recipe for evasion and subterfuge. Let us suppose that a journalist rings up to ask if there will be a press notice commenting on what has occurred. If either of the amendments is carried, there are two possible answers. The first is, "You must ask my party, and of course I will be in touch with them straightaway to supply them with the answer". The other is, "We can't issue a notice, but if you ask for our answer, we can give it, and if any of your colleagues ask for it, we can give it to them too. Please spread the word around. We will increase the number of press officers to answer their calls".
Amendment No. 202, the milder amendment to which the noble Lord spoke, is not an answer to that problem. It simply would not make sense in some cases

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for the government of the day to give out information and fail to respond to the obvious question of whether the new event changes its view. If we attempted to put such a limitation in place, we would be recreating precisely the kind of distinction between factual and promotional material which the committee chaired by the noble and learned Lord thought unsound.
I end by repeating that Clause 122 is meant to serve a specific purpose in a specific way: to prevent a government of any colour from putting material through people's post-boxes. It is not meant to prevent them from answering as a government for their policies and views, and I do not believe that any realistic party would want such a restriction. We believe that both Amendments Nos. 201 and 202 should be withdrawn.
7.30 p.m.
Lord Mackay of Ardbrecknish: My Lords, I notice a total and utter failure to address the question I posed about press conferences and press notices in the light of the judgment of your Lordships' House, just as if that did not matter or exist. I am staggered.
Lord Bach: My Lords, I thank the noble Lord for giving way. We heard exactly what was said by the noble Lord about the important decision made by the Judicial Committee of this House. However, I do not believe that anything I have said goes against the principle or spirit of that judgment. We understand the view taken by that court in relation to press notices. Nothing I have said goes against the principle in that case.
Lord Mackay of Ardbrecknish: My Lords, I believe that the noble Lord does not read the press notices issued by the Government. If he did, he would see that most of them have the spin which the Government want them to have. Few are entirely factual; they all have a spin. Frankly, if they did not have a spin I would be amazed. It is not just this Government which do that; all governments do it.
As to the fact that during the purdah period the Government will not be able to put notices into post-boxes, perhaps I may say that they will. The new post-boxes are e-mail addresses and the website. People will be able to access the website and receive notices just as if such notices had come through their front door.
Lord Bach: My Lords, I apologise to the noble Lord. I know that this is Report stage; I am the one who mentioned that earlier. However, I should have dealt with this point. As I am advised, press notices on the Internet would, in any event, be covered by Clause 122 (3)(a), which I invite noble Lords to look at. It states that subsection (2) does not apply to:
"material made available to persons in response to specific requests for information or to persons specifically seeking access to it".
A person specifically needs to seek access to a website. Perhaps I may point out to the noble Lord that he has never said that he is not content with that provision.
Lord Mackay of Ardbrecknish: My Lords, I now wonder what purdah is about. To say that, if I open up a website to look at information contained on it, I am somehow seeking the information and that it is not coming to me is, frankly, splitting hairs in the modern world. I think that many companies would not view that as the way in which people use their websites. People browse at information which then comes to them. In any case, that does not address the problem of a press conference.
However, much more worrying was the example given by the noble Lord. To carry on with the referendum theme, if a foreign government, perhaps the Government of Denmark where the people have said "no", were to issue a press release stating, "We very much hope that the British people will also say 'no' for these reasons", the Government during the purdah period would feel free to put out a press notice, call a press conference and all the paraphernalia that happens, in order to counter the statement made by a Minister in Denmark.
I do not see any problem with the Government simply saying, "We are in purdah on this. This is a 28-day period. You will have to go down the road to talk to Millbank", or talk to the Liberals, the "yes" campaign or whatever. I see no problem with that. The press are not daft. They would understand what was happening and that some fair rules were being played.
The example given by the noble Lord makes me feel that purdah will be a farce. The Government will use all the machinery of their press office to carry on as they did before the purdah started. I believe that this is a serious matter, to such an extent that I shall test the opinion of the House, not on my compromise—clearly, that is brushed aside—but on the main amendment.
Lord Monson: My Lords, before the noble Lord, Lord Mackay, tries to put his amendment, perhaps I may suggest that it would be better to concentrate upon Amendment No. 203, which is not open to the same challenge as the previous two amendments, and therefore has more chance of success.
Lord Mackay of Ardbrecknish: My Lords, as the noble Lord has intervened, perhaps I may simply say that I can count and I noticed the last Division. I do not think his argument holds a great deal of weight. I am more appalled at what I have just heard about this item on press releases than I am about the purdah issue, and I was pretty appalled at that. I beg to move.
7.38 p.m.
On Question, Whether the said amendment (No. 201) shall be agreed to?
Their Lordships divided: Contents, 42; Not-Contents, 124.

Division No. 2

CONTENTS

Ampthill, L.

Lyell, L.

Astor of Hever, L.

McColl of Dulwich, L.

Blackwell, L.

Mackay of Ardbrecknish, L.

Blatch, B.

Mar, C.

Byford, B.

Marsh, L.

Carnegy of Low, B.

Moynihan, L.

Colwyn, L.

Noakes, B.

Courtown, E.

Norton of Louth, L.

Cranborne, V.

Onslow, E.

Dean of Harptree, L.

Peyton of Yeovil, L.

Elton, L.

Renton, L.

Fraser of Carmyllie, L.

Roberts of Conwy, L.

Geddes, L.

Rogan, L.

Glentoran, L.

Seccombe, B. [Teller]

Gray of Contin, L.

Selsdon, L.

Harris of Peckham, L.

Stewartby, L.

Henley, L.[Teller]

Strathclyde, L.

Hodgson of Astley Abbotts, L.

Thomas of Gwydir, L.

Hunt of Wirral, L.

Waddington, L.

Laird, L.

Willoughby de Broke, L.

Lucas, L.

Windlesham, L.

NOT-CONTENTS

Acton, L.

Gordon of Strathblane, L.

Addington, L.

Goudie, B.

Ahmed, L.

Gould of Potternewton, B.

Alderdice, L.

Grabiner, L.

Amos, B.

Graham of Edmonton, L.

Andrews, B.

Greaves, L.

Archer of Sandwell, L.

Gregson, L.

Bach, L.

Grenfell, L.

Barker, B.

Hamwee, B.

Bassam of Brighton, L.

Harris of Greenwich, L.

Beaumont of Whitley, L.

Harris of Haringey, L.

Bernstein of Craigweil, L.

Harrison, L.

Billingham, B.

Hayman, B.

Blackstone, B.

Hilton of Eggardon, B.

Blease, L.

Hollis of Heigham, B.

Bradshaw, L.

Holme of Cheltenham, L.

Bragg, L.

Hoyle, L.

Brennan, L.

Hughes of Woodside, L.

Brett, L.

Hunt of Kings Heath, L.

Brooke of Alverthorpe, L.

Islwyn, L.

Burlison, L.

Janner of Braunstone, L.

Carter, L.[Teller]

Jay of Paddington, B. (Lord Privy Seal)

Chandos, V.

Clarke of Hampstead, L.

Jenkins of Putney, L.

Clement-Jones, L.

Kennedy of The Shaws, B.

Clinton-Davis, L.

Kirkhill, L.

Cocks of Hartclifie, L.

Layard, L.

Cohen of Pimlico, B.

Lea of Crondall, L.

Crawley, B.

Lipsey, L.

David, B.

Lockwood, B.

Davies of Coity, L.

Lofthouse of Pontefract, L.

Davies of Oldham, L.

Macdonald of Tradeston, L.

Desai, L.

McIntosh of Haringey, L. [Teller]

Dubs, L.

Elder, L.

McIntosh of Hudnall, B.

Evans of Watford, L.

MacKenzie of Culkein, L.

Falkland, V.

Mackenzie of Framwellgate, L.

Farrington of Ribbleton, B.

Mackie of Benshie, L.

Faulkner of Worcester, L.

McNally, L.

Fyfe of Fairfield, L.

Maddock, B.

Gale, B.

Mar and Kellie, E.

Gibson of Market Rasen, B.

Massey of Darwen, B.

Gladwin of Clee, L.

Miller of Chilthorne Domer, B.

Goodhart, L.

Mitchell, L.

894

Molloy, L.

Simon, V.

Morgan, L.

Smith of Clifton, L.

Morris of Castle Morris, L.

Smith of Leigh, L.

Nicol, B.

Stoddart of Swindon, L.

Northover, B.

Thomas of Walliswood, B.

Oakeshott of Seagrove Bay, L.

Tomlinson, L.

Ramsay of Cartvale, B.

Tope, L.

Rea, L.

Tordoff, L.

Redesdale, L.

Turnberg, L.

Renwick of Clifton, L.

Uddin, B.

Rodgers of Quarry Bank, L.

Varley, L.

Roper, L.

Walker of Doncaster, L.

Russell, E.

Warner, L.

Sainsbury of Turville, L.

Wedderburn of Charlton, L

Sandberg, L.

Whitaker, B.

Scotland of Asthal, B.

Whitty, L.

Scott of Needham Market, B.

Wilkins, B.

Sharp of Guildford, B.

Williams of Mostyn, L.

Shutt of Greetland, L.

Winston, L.

Resolved in the negative, and amendment disagreed to accordingly.
7.48 p.m.
[Amendment No. 202 not moved.]
Lord Marsh Lord Marsh moved Amendment No. 203:
Page 87, line 44, at end insert—
("(3A) Subject to subsection (3B), no material to which this section applies shall be distributed or displayed to the public free of charge during the referendum period by or on behalf of—

(a) any Minister of the Crown, government department or local authority;

(b) any other person or body whose expenses are defrayed wholly or mainly out of public funds or by any local authority; or

(c) the Post Office;

unless such material—

(d) is factual and impartial; and

(e) has been circulated to permitted participants at least seven days before it is published.

(3B) Subsection (3A) does not apply to—

(a) material made available to persons in response to specific requests for information or to persons seeking access to it; or

(b) material published on web-sites.").

The noble Lord said: My Lords, I rise—encouraged by the narrowness of the last vote—to pursue Amendment No. 203. Briefly, it is an issue of fundamental principle.
I start by saying that, having heard some of the comments in the previous debate, I do not believe that any circumstance of national consequence could arise in which the parties involved in a referendum would manage or even wish to stop the government of the country getting their message across. I do not believe that would happen and Amendment No. 203 specifically recognises that government have to continue in the course of elections and referendums; and they have a right and duty so to do.
One of the fundamental differences between democracies such as ours and those with a shorter history of stability and trust is the extent to which governments intervene in elections and referendums. This amendment seeks merely to find another formula

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which the noble Lord, Lord Bassam, although he holds a brief which probably makes minor changes, might find acceptable.
I was a founder member of Business for Sterling and I am president of the council of that admirable organisation. In the light of some of last night's debates, I believe that the amendment goes wider than arguments about the European Union, the euro and so forth. The issue is simple, fundamental, non-partisan and was clearly described in the report of the Committee on Standards in Public Life, which I shall not quote again. It is that all governments will be tempted—they always have been—to take advantage of any situation and if they are able to mobilise at taxpayers' expense an argument which suits them politically they will take the opportunity to do so.
I have been accused of many things but never of being a political romantic. Governments have always sought to use their position to influence the results of elections and referendums. Luckily, we in this country can afford to live with it, despite complaining when it happens. But the problem is the blatant potential imbalance which arises regularly with each referendum and is beginning to endanger the credibility of referendums in a democratic society.
An example is the European referendum. The "no" campaign will be restricted to £5 million for the referendum period but the Government have already spent more than £15 million on "information", including a direct mailshot to 800,000 businesses. I give that example because 75 per cent of British business has no trade with Europe. By definition, the 15 per cent which trades with Europe does not require advice on how to trade in foreign currencies, whether they be deutschmarks, French francs, Burmese kyats or euros. It is a totally false argument which is thinly disguised as crucial to the Government's position. The position is indefensible and if it remains unchecked it will worsen.
It is not a party issue. When I became a Minister many years ago I received a wondrous letter from the late Douglas Houghton congratulating me on becoming a Minister. He concluded by stating (those who remember him will hear his voice):
"You will enjoy being a Minister enormously. It will almost certainly be the most interesting thing you ever do. But one thing, dear boy, never forget, it will not last".
I warn noble Lords on the Government Benches that when the two parties change sides, as will happen at some stage, Chancellor Mackay of Ardbrecknish will stand at the Dispatch Box and with all his usual eloquence will argue that any restrictions upon the Government's freedom of action would be a constitutional outrage and undoubtedly a breach of human rights legislation.
The trend will continue and if it continues on the present scale it can only get worse. It is highly undesirable. The amendment gives the government of the day plenty of opportunity to circulate any factual and impartial material, subject to the participants having an opportunity to comment within seven days. All the materials published on websites will also be
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unrestricted. Like others, we seek to halt a situation in which a government can wage two campaigns at the same time: one through their party office, like all the other parties, and the other at the taxpayers' expense out of Number 10.
It is a highly undesirable situation. I put the amendment to the House and hope that the noble Lord, Lord Bassam, will absorb it in addition to all the others. It is a pity that all the similar amendments were not in the same group. I hope that the noble Lord will accept that such a change would benefit everyone. We seek a position in which no one will view the legislation as giving anyone the authority to prevent a government governing during an election or referendum campaign.
Lord Willoughby de Broke: My Lords, I rise briefly to support the amendment tabled by the noble Lord, Lord Marsh. It is important that during a referendum campaign the Government and other public bodies should be prohibited from sending contentious and slanted propaganda through the post, by e-mail and so forth.
There was a recent example of that when the Post Office sent about 170,000 leaflets through the post to small and medium-sized businesses extolling the virtues of the euro in terms which could not be described, even by the warmest admirer of the euro, as impartial. Such incidents make the amendment essential.
Furthermore, it would be unfortunate if under the guise of information the Government brought forward another discussion paper or introduced an annual review of the national changeover plan during a referendum period. Amendment No. 203 covers those matters and I hope that the Government will take on board the points which have been made and act accordingly.
Lord Bassam of Brighton: My Lords, Clause 122 is the Government's discharge of the recommendation in the Neill report that at a certain point before a referendum is held the government of the day, as a government, should stand back—should stand aloof—and leave the campaigning to the political parties and other campaign organisations.
The Neill committee was particularly sceptical about material which in previous cases was circulated to the electorate very close to the date of the poll. It questioned the distinction between factual and persuasive material. Clause 122 implements the committee's recommendation by providing for a 28-day embargo on the issue to the public of government publications. This arrangement is equivalent to restrictions on the role of the Government in the run-up to a general election.
Amendment No. 203 would additionally require that material circulated by the Government during the referendum period as a whole must be factual and impartial and must have been circulated to permitted participants at least seven days prior to publication. In other words, it is proposed that, in addition to the

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complete ban which applies in the 28 days prior to the poll, it should also be incumbent upon the Government to prepare neutral material during the remainder of the referendum period.
That would not work. Perhaps I may remind the House precisely why the Neill committee considered a ban on government material to be necessary. The Neill committee said in paragraph 12.44 of its report:
"We believe that it is extraordinarily difficult, if not impossible, for the government of the day to offer purely objective and factual information in the course of a referendum campaign, especially when, as is usually the case, it is itself a party to the campaign";
in other words, it was the very impossibility of regarding even purported factual material as impartial that led the committee to conclude that the kind of ban for which this clause provides was necessary. There is an argument over whether the ban should apply throughout the entire referendum period. The reason for not doing so is that that period is likely to cover the passage through Parliament of a Bill which makes provision for the referendum.
8 p.m.
Lord Bach: My Lords, the noble Lord, Lord Phillips, rises to speak. I take it that the noble Lord intends to put a question to elucidate an answer from the Minister.
Lord Phillips of Sudbury: My Lords, I thank the noble Lord for anticipating my purpose. Is it not the case that, in the context of the difficulty of adjudicating between pure information and tendentious information, under Clause 142 the commission has "the general function of monitoring compliance"? Therefore, is not the commission the obvious and natural body to undertake that task?
Lord Bassam of Brighton: My Lords, one can argue that the commission is the natural body to do it. However, one would be charging the commission with an extraordinarily difficult task. Recently, we had a debate on the question whether a referendum question should be viewed as fair or biased. The amendment in question proposed that that matter should be put to the commission for consideration. I believe it was concluded that it was a very difficult job for any body to carry out, and it ran the risk that the commission would be placed in a highly political position. I believe that that could well be the result in this context.
During the course of a Bill passing through Parliament government would want to argue their case. It is not possible to conceive that factual material produced by government in relation to such a Bill would be universally regarded as impartial. I do not see the case for providing permitted participants with advance sight of any such "factual and impartial" material. Why should campaign organisations see such material!before the electorate? Is it being suggested that, for example, the explanatory notes to a Bill should be circulated to permitted participants before being published?
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The proposal seems to be predicated on the assumption that such material will not be impartial at all and that permitted participants should be given advance notice so that they can have their riposte prepared in time for publication. In short, the proposal is aimed at the wrong target. The real point is that, as the Neill committee recommended, there should come a point at which the government of the day stand back from the fray altogether, and the clause as it stands provides precisely for that. I believe that the noble Lord's amendment, well intentioned though it is, places far too great a responsibility on those who would be asked to judge whether something was impartial and fair. For those reasons, I ask the noble Lord to withdraw his amendment.
Lord Phillips of Sudbury: My Lords, before the noble Lord sits down, does he agree that the clause as it now stands, bereft of this amendment or something like it, allows the government of the day, who after all are the only ones who will know when a referendum is to be held, to shower the public with highly tendentious and persuasive literature five weeks before a referendum, and in a manner which would be grossly unfair and unbalanced vis-à-vis other parties to the referendum?
Lord Bassam of Brighton: My Lords, the noble Lord asks a loaded question, and I believe that his proposition is an unreasonable one. Government who are in the serious business of governing will act entirely responsibly throughout the introduction of the Bill, and the debates upon it, in Parliament. I cannot see government wanting to try to load the issue because it would be counter-productive, particularly in the United Kingdom, which has a free press.
Lord Phillips of Sudbury: My Lords, is it not a negation of the purpose of this clause, and the amendment to it, to say that government will be responsible? Surely, we are talking here of the possibility of government being irresponsible.
Lord Bassam of Brighton: My Lords, I just cannot agree with the noble Lord.
Lord Marsh: My Lords, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 204 and 205 not moved.]
Clause 126 [Orders regulating conduct of referendums]:
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 206:
Leave out Clause 126.
The noble Lord said: My Lords, Amendment No. 206 would simply remove Clause 126. The clause gives the Secretary of State very wide-ranging order-making powers. During Second Reading in the other place, Mr Mike O'Brien said:
"We intend to table amendments that will … make the legislation a truly generic referendums Bill".—[Official Report, Commons, 10/1/00; col. 113.]

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Clause 126 was a government amendment tabled in Committee in another place. However, the clause does not turn this Bill into a truly generic referendums Bill; it is a Henry VIII provision. The clause gives the Secretary of State the power, after consulting the electoral commission, but not on that body's recommendation, to make rules for referendums. Further, he will have power to create criminal offences. Can the Minister tell us what kind of criminal offences and penalties the Government intend to create under Clause 126?
In another place the clause was condemned by opposition members as a charter for gerrymandering referendums. The Government promised a generic referendums Bill, but this clause does not provide one; it is a Henry VIII provision. Having called for a general referendums Bill since 1997 when the first measure concerned with referendums appeared, I am deeply disappointed that a clause like this appears in the Bill. I beg to move.
Lord Hodgson of Astley Abbotts: My Lords, I speak in support of my noble friend's amendment. At Report stage we have talked at great length about the strategic purpose of the Bill which is to rebuild confidence in the democratic process. This is one of the issues to which we have turned all our efforts. The Minister has spoken of the importance of the electoral commission being in a position which is above reproach so that it carries the confidence of all sections of the community. Suddenly, one sees Clause 126, which covers referendums that are by any stretch of the imagination contentious. The Government must be aware of the degree of disquiet in different corners of the House tonight about the issue of referendums and the various provisions of the Bill which are complicated and difficult to understand. The Secretary of State is to take unto himself powers that are wide ranging. To do that in a contentious area is likely to undermine not only the purpose of the Bill but confidence in the electoral commission and its role in the future structure of government.
Lord Monson: My Lords, I too support the amendment. I confess that I began to examine Clause 126 only about 15 minutes ago. The very words used by the noble Lord, Lord Mackay, immediately spring metaphorically to my lips. This is a Henry VIII clause which creates new and undefined criminal offences, presumably with potentially very severe penalties. I am interested to hear the Government's response.
Lord Bach: My Lords, this clause enables the Secretary of State to make detailed provision for the conduct of referendums by order. I make it quite clear that the Bill will not replace the need for specific legislation to authorise the holding of a referendum on a particular issue. But the consideration of such legislation should focus on the key questions; namely, whether it is right to hold a referendum on the particular issue; and, if so, when it should be held and what the question should be. The simple purpose of Clause 126 is to obviate the need to make detailed
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provision on the face of each Bill providing, for a referendum to be held as to the arrangements for the conduct of the poll. For example, by far the larger part of the Referendums (Scotland and Wales) Act 1997 was taken up by a schedule setting out necessary modifications to the Representation of the People Act 1983 and to other statutes and regulations for the purposes of those referendums. We cannot see any reason why that kind of matter should not be left to subordinate legislation.
Clause 126 would therefore enable the Secretary of State, after consulting the electoral commission, to make detailed provision for the conduct of a particular referendum by order. In practice, that will mean applying with appropriate modifications the relevant provisions of the Representation of the People Acts and regulations. Therefore, Clause 126(2)(b) specifies that such an order may apply, with or without modification, any provision of any enactment and make different provision in relation to different parts of the United Kingdom. That latter point simply reflects the fact that some aspects of electoral law differ in Northern Ireland and, indeed, Scotland, as compared with the rest of the United Kingdom.
Turning to the creation of offences to which the noble Lord referred, he rightly says that Clause 26(2)(a) specifies that such an order may provide for the creation of offences. There is no sinister purpose behind the provision. Its purpose is simply to apply to referendums those offences that already exist in relation to elections or equivalent offences where the existing offences are inappropriate. The Representation of the People Act creates various offences. Personation is one of them. There are other related offences. Any order under Clause 126 would apply these for the purposes of a referendum.
I should remind the House that there are a number of precedents for this kind of order-making power. For example, the arrangements for the conduct of the elections to the Scottish Parliament and Welsh Assembly rely on similar order-making powers in Section 12 of the Scotland Act 1998 —an Act with which the noble Lord is familiar—and Section 11 of the Government of Wales Act 1998.
A process very like Clause 126 was included in a Northern Ireland (Border Poll) Act 1972. When considering the matter, that is perhaps not an Act that comes immediately to noble Lords' minds. That was an Act passed under a different government, albeit many years ago.
Finally, it is worth recording, because if the opposite were true we should have heard much about it, that the Select Committee on Delegated Powers and Deregulation made no recommendation about this or—in passing—any other of the delegated powers in the Bill. If that committee had no difficulty with the power to create offences or to apply other enactments, we do not see any reason for the House to take a different view.
Lord Mackay of Ardbrecknish: My Lords, I am very dissatisfied with that answer because the Minister has

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really failed to address the point. Yes, we had to have schedules to the Referendums (Scotland and Wales) Act, but they were cut-and-paste jobs because there was not a generic referendums Act on the statute book. Yes, we had to have the same cut-and-paste jobs for the Scottish parliamentary elections. But we do not need to have cut-and-paste jobs for general elections because laid down in statute we have the rules governing them. Ministers do not need to come up with elaborate regulations every time we have a general election. They are all laid down. Occasionally we make changes, but we make these changes sensibly in between times.
The Representation of the People Act is on the statute book. It is ready. One presses a button and off one goes. The point about a proper generic referendum Bill is that it would take the cut-and-paste job we had to do for the Scottish referendum, ensure it was general in its application to any referendum, and incorporate that as schedules to the Bill. Perhaps I should have gone to the trouble of so doing. I helped the Government out in July 1997 when they got into a total shambles over the schedules which allowed the referendum to take place. I helped them to set out the details. I rather hoped that they had learned the lesson. It would lengthen the Bill, but I really would not have complained in this case because the rules for referendums would have been set out clearly in a principal Act, just as the rules for general elections are.
I am sorry that the Minister does not see this as an important point. But if we are going to use referendums, one day the Government will have to do that because it is a cumbersome procedure to do cut-and-paste jobs based on general election procedures and make them fit referendum procedures. That is all I was really after in a generic referendums Act. Clearly I did not explain myself well enough. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.15 p.m.
Schedule 16 [Control of donations to candidates: New Schedule 2A to the Representation of the People Act 1983]:
Lord Bach Lord Bach moved Amendments Nos. 207 to 210:
Page 193, line 18, leave out ("(2)(d)") and insert ("(1)(d)").
Page 193, line 21, leave out ("(2)(e)") and insert ("(1)(e)").
Page 193, line 43, leave out ("bequest") and insert ("a bequest or any other form of testamentary disposition").
Page 195, line 36, leave out sub-paragraph (2) and insert—
("(2) For the purposes of this Schedule any relevant donation received by a candidate or his election agent which is an exempt trust donation shall be regarded as a relevant donation received by the candidate or his election agent from a permissible donor; and section (Interpretation: exempt trust donations) of the 2000 Act (Interpretation: exempt trust donations) shall apply for the purposes of this Schedule as it applies for the purposes of that Act.
(2A) But, for the purposes of this Schedule, any relevant donation received by a candidate or his election agent from a trustee of any property (in his capacity as such) which is not—

(a) an exempt trust donation, or

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(b) a relevant donation transmitted by the trustee to the candidate or his election agent on behalf of beneficiaries under the trust who are—

(i) persons who at the time of its receipt by the candidate or his election agent are permissible donors falling within section 52(2) of the 2000 Act, or

(ii) the members of an unincorporated association which at that time is such a permissible donor,

shall be regarded as a relevant donation received by the candidate or his election agent from a person who is not such a permissible donor.").
On Question, amendments agreed to.
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendments Nos. 211 and 212:
Page 196, line 3, leave out ("not less") and insert ("more").
Page 196, line 17, leave out ("not less") and insert ("more").
On Question, amendments agreed to.
Lord Bach Lord Bach moved Amendments Nos. 213 and 214:
Page 196, line 24, leave out second ("(7)") and insert ("(6)").
Page 198, line 43, leave out ("(2) to (10)").
On Question, amendments agreed to.
Clause 129 [Financial limits applying to candidates' election expenses]:
Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 215:
Page 93, line 5, leave out ("at") and insert ("whether before, during or after an election on account of, or in respect of, the conduct or management of").
The noble Lord said: In moving Amendment No. 215, I shall speak to Amendment No. 216. Noble Lords will be pleased to hear that these amendments get us away from referendums. They are probing amendments because something has been drawn to my attention about the way the Bill changes the Representation of the People Act 1983.
These amendments deal with candidates' election expenses. It is an important matter but it has been dwarfed by party funding, donation disclosure, Northern Ireland and all the referendum funding questions.
Prior to the Bill being brought before the House, election expenditure was mainly linked to candidate's election expenditure under the requirements set out in the Representation of the People Act 1983. Clause 129 of the Bill seeks to amend Section 76(1) of the existing Representation of the People Act 1983. It removes from existing legislation the statement that:
"No sum shall be paid and no expense shall be incurred by a candidate at an election or his election agent, whether before, during or after an election, on account of or in respect of the conduct or management of the election, in excess of the maximum amount specified in this section, and a candidate or election agent knowingly acting in contravention of this subsection shall be guilty of an illegal practice".
Nowhere in the proposed legislation is there so clear an indication that any expenses incurred by a candidate prior to the dissolution of Parliament, or in the case of a by-election the occurrence of the vacancy, will count towards their election campaign expenses.
This might be an oversight, or the Minister may wish to argue that the intention remains the same. However, the proposed Clause 132 of the Bill introduces a new Section 118A for the Representation of the People Act 1983 which in its subsection 2(b) envisages that a candidate can be declared, by himself or by others, as a candidate earlier than at the dissolution of Parliament. However, this section does not make clear the position on election expenditure.
We are told by the Government that the aim of the Bill is to produce a level laying field in the area of national political campaign expenditure. We can argue whether that may or may not be achieved, but I contend that it muddies the water around candidates' constituency campaign expenditure and it is a disservice to election law.
Election law contains many grey areas. I fear that if we are not careful an opportunity will be lost to introduce real clarity in respect of candidates' election expenses.
At every election there are questions raised by one or other candidate that an opponent is taking unfair advantage of existing law or, more often, bending it. Nothing undermines the integrity of a poll more than questionable or illegal acts like those we are seeing at the moment in the American presidential election. I believe that the missing elements of Section 76 of the RPA could he reintroduced into Clauses 129 and 131 of the PPER Bill in subsection (5)(a) of the proposed new Section 90A. That seems like a huge amount of letters—almost an alphabet soup. But I am sure that the Minister has been well advised about what my amendment seeks to do.
The key to when a candidate's election commences is that it should start from the first moment that he or she, or anyone on their behalf—I stress "on their behalf"—takes any action to promote their candidature for an election at which they are subsequently nominated. It could not be simpler. The expenses to be covered would be those for the promotion of the candidature and the conduct or management of the campaign.
I have not cooked this point up out of thin air. People who for many years have operated election law at constituency level are concerned about the change the Bill makes to the 1983 Act and they feel that there may be a serious problem of which the Government have perhaps not thought. I beg to move.
Lord Bach: My Lords, I was about to congratulate the noble Lord on having spotted without help from anyone else the difficulty that he sees. However, as he was gracious enough to admit, the point has come to him from another source.
Lord Mackay of Ardbrecknish: My Lords, my honesty was greatly impelled by the fact that I thought that the noble Baroness, Lady Gould, might well be aware of the source it came from.
Lord Bach: My Lords, what my noble friend says to me or does not say to me is no business of the noble Lord.
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I shall be as brief as I can. The amendments concern the definition of a candidate's election expenses. Clause 131 introduces new Sections 90A to 90D of the 1983 Act which set out a revised definition of election expenses. That revised definition is carried over to Section 76 of the 1983 Act, as amended by Clause 129 of the Bill, which sets limits on candidates' election expenses. The combined effect of Clauses 129 and 131 is that Section 76 of the 1983 Act no longer refers to election expenses incurred,
"on account of, or in respect of, the conduct of management of the election".
Instead, the limits on election expenses will apply to such expenses as defined in Sections 90A to 90D of the 1983 Act; that is, expenses incurred with,
"a view to, or otherwise in connection with, promoting or procuring the candidate's election at the election".
In the Government's view, this new formulation represents a considerable improvement on the existing rather ambiguous provisions of the 1983 Act.
The noble Lord seeks to retain the "conduct or management" formula. He is not satisfied with the old formula on its own as he wants to graft it on to the new definition in new Sections 90A to 90D of the 1983 Act. We think that there may be some confusion if that is done. We have received no representations until now about the demise of the formula. As I think is now generally accepted, to refer to election campaigning as the "management" of an election is somewhat quaint, if not archaic. In the language of today we suspect that most candidates would regard the returning officer as the person who actually manages the election.
My next point deals more closely with the point made by the noble Lord in moving the amendment. Nor is it necessary to retain the words,
"whether before, during or after an election",
since Section 90A(2) has the same effect. That is my answer to the problem raised by the noble Lord. We think that the formula used in the 1983 Act has had its day and is in need of updating. That is why we have changed it.
Before I sit down, perhaps I may say that this is a complicated and detailed point. Although we think that we have the answer to it, I would be happy to go away with the point, talk to the officials and perhaps talk to the noble Lord again to see whether those who advise him are right or whether we are right, because we do not want to get it wrong.
Lord Mackay of Ardbrecknish: My Lords, I am grateful to the noble Lord. Such is the complexity of the matter that perhaps it would have been better if I had sent the noble Lord a letter at an earlier stage. I shall certainly ensure that the people who brought this point to my attention are made aware tomorrow of what the Minister has said. If we have to develop the point further, I am sure we can. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 131 [Meaning of 'election expenses']:
[Amendment No. 216 not moved.]
Clause 133 [Corrupt and illegal practices: consequences for persons convicted of such practices]:
Lord Bach Lord Bach moved Amendment No. 217:
Page 98, line 38, at beginning insert ("Subject to subsection (1A) below,").
The noble Lord said: My Lords, in moving this amendment, perhaps I may speak also to Amendments Nos. 218 and 220. These four amendments relate to the incapacities that result following a person's conviction for a corrupt or illegal practice. Under the Representation of the People Act 1983 a candidate convicted of a corrupt or illegal practice is not only debarred for a period from holding elective office but also disqualified as a voter. Having examined these provisions, as amended by Clause 133 of and Schedule 17 to the Bill, more closely, we feel that this dual sanction is difficult to justify. It is entirely proper that where a person is found guilty of an offence as a candidate one of the consequences should be a period of disqualification from holding elective office. But the sanction of disfranchisement more appropriately fits offences committed by a voter; for example, personation. These amendments make the appropriate adjustment to the 1983 Act to this end. I beg to move.
On Question, amendment agreed to.
Lord Bach Lord Bach moved Amendment No. 218:
Page 99, line 7, at end insert—
("(1A) The incapacity imposed by subsection (1)(a)(i) above applies only to a person convicted of a corrupt practice under section 60 above or of an illegal practice under section 61 above.").
On Question, amendment agreed to.
Schedule 17 [Amendments relating to election petitions]:
Lord Bach Lord Bach moved Amendments Nos. 219 and 220:
Page 200, line 31, after ("of") insert ("subsection (4A) and")).
Page 200, line 43, at end insert—
("(4A) The incapacity imposed by subsection (4)(a)(i) above applies only to a candidate or other person reported personally guilty of a corrupt practice under section 60 above or of an illegal practice under section 61 above.").
On Question, amendments agreed to.
Schedule 18 [Election campaigns and proceedings: miscellaneous amendments]:
Lord Bach Lord Bach moved Amendments Nos. 221 to 225:
Page 201, line 35, at end insert—
("() In subsection (2), for "and by a receipt" there shall be substituted "or by a receipt".").
Page 203, line 15, leave out ("and") and insert ("or").
Page 207, line 1, after ("3,") insert ("the form of return and").
Page 207, line 5, at end insert—
(" . In Schedule 4 (election expenses in connection with certain local elections), in paragraph 3, for "and receipts" there shall be substituted "or by receipts".").
On Question, amendments agreed to.
Clause 136 [Control of political opinion by companies]:
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 226:
Page 101, line 12, at end insert—("(1A) The purpose of Schedule 19 is to limit donations by companies to political parties and expenditure by companies for political purposes by way of disclosure both to shareholders and to employees as partners in the enterprise and to secure necessary and proportionate control over such expenditure in order that it should not unduly distort the democratic process and its exercise by the sovereign electorate.
(1B) Nothing in subsection (1A) creates an offence or any liability, but the terms of the subsection shall be taken into account by the court.").
The noble Lord said: My Lords, in considering how I should approach this amendment, I wondered whether I should follow a famous precedent on amendments on rights for employees and their representatives. On 3rd August 1906, at what Lord Robert Cecil complained was a late hour,
"on a Friday afternoon at the fag end of the Session",
Sir Charles Dilke, that great Liberal statesman, moved a critical amendment to the Trade Disputes Bill for what were then called the "labouring classes". Although he moved the amendment, Dilke made no speech on it. It was left to the House, led by the Attorney-General, to debate it and he relied on the fact of the great Liberal majority that had been returned in the general election to see him through. It was made rather easier by the fact that Mr Balfour, as Hansard records, led most of the Conservative and Unionist Members out of the Chamber in protest against a breach of an alleged government guarantee that debate would end at 11 p.m. on that Friday—a guarantee that was denied by the Government.
I decided that it would be wrong and discourteous to take that course and not to say something about Amendment No. 226. I should say that I wish to speak also to Amendment No. 252. Amendment No. 226 offers a skeleton. Amendment No. 252 puts sufficient flesh on the skeleton to make it a real debate. When directors decide to make political donations from the funds of the company, it has been true at least since 1967 that they should disclose what they are doing. Indeed, disclosure has gone beyond the protection of shareholders, as any student of company law will know. Today, disclosure would include the purposes for which my party fought the election in regard to industrial relations, which my right honourable friend the Prime Minister described in his foreword to Fairness at Work as:
"Already modern and successful companies draw their success from the existence and development of partnership at work".
In some ways this is not a new idea. Extensive literature has been published both here and on the continent concerning what many writers call "conflictual partnership", in the sense that sometimes the interests of workers, shareholders and managers are common, while on other occasions they conflict. In recognising that conflict, one has to take account of the fact that shareholders in a large public company can change their position much more easily than most of the employees simply by selling their shares and

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changing their investment. The conflicts of interest that do occur form the basic reason why autonomous trade unions exist in all democratic countries.
Because of the decision reached by your Lordships' Judicial Committee in the Osborne case in 1910, we have long had in place extremely strict legislation concerning the political funds of trade unions. Some have suggested that there should be an equal form of legislation for companies, with an opt-out for shareholders as regards political expenditure. I am glad that the Government have not adopted that proposal here because it is not all that practicable. Instead, the new mechanisms for the control of political expenditure in this Bill include disclosure to the shareholders and, in a new residual mechanism of control, a procedure whereby shareholders may eventually challenge the directors' donations for political purposes in the courts. In particular, they will be able to challenge a donation if it lacks the required resolution of approval in a company meeting, to which I shall return when we reach later amendments.
The amendments seek to put in place a parallel obligation on the company to disclose in good time proposed political expenditure to the employees' representatives, to consider any representations they may make and to respond to them if they so wish. The definition of employees' representatives has been taken from three of the mechanisms already known to our law; namely, representatives of a trade union recognised by the company; representatives of a trade union legally entitled to recognition of the status of bargaining agent under the new schedule to the Employment Relations Act 1999; or representatives elected by the workforce in a manner parallel to the methods permitted by the amended provisions of what are now Sections 188 and 188A of the Trade Union and Labour Relations (Consolidation) Act 1992.
These amendments do not give to employee representatives precisely equal status to the shareholders in their competence to apply to the courts for control of political expenditure. However, they leave it open to the Minister, once the system has been running for two years or more, to use powers to introduce regulations—which probably I should have drafted as affirmative orders—which would enshrine similar rights for employee representatives. However, that is a power for the future, if it is needed, as in paragraph 347K of Schedule 19 to the unamended Bill.
There is special provision for cases where the company objects to disclosure of information on the ground that it is confidential—which noble Lords will see builds on the important and most welcome innovation by the Government; namely, in the transposition of the European Works Council Directive in Regulation 24 of the trans-national information instrument, SI 3323 of 1999. In brief, this transfers jurisdiction over disputes about confidentiality to the Central Arbitration Committee, which, since 1975, under its chairman Sir John Wood, has a long history of reaching informal and sensible solutions to industrial disputes. On confidentiality, it would judge as it does in the regulations; namely, not by subjective considerations but by determination,
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using objective tests relating to whether the release of information would be harmful to the enterprise on objective grounds.
The central obligation of management here would be to transmit to the employee representatives within the two weeks before the relevant meeting of the shareholders the terms of the resolution proposed and any other information that it wished to give. Representatives would then have the right to ascertain the opinions of relevant workers, although there would be no power to associate any particular opinion to individuals. This is not a proposal for co-determination in the German style; it is not even a requirement of the kind one finds in Sweden and other countries for a disclosure provision which forms part of the right to bargain. It is a moderate requirement of disclosure and minimum consultation in a tradition which is peculiarly apt for our own jurisdiction, with a long tradition of consultation stemming from the Whitley Committees proposals in 1917.
I believe that modern management agrees with the concept of partnership at the place of work, albeit that most people might precisely define it as they like. Nevertheless, there is a common core of agreement. Partnership in industrial relations must produce more than the aspirational semantics of co-operation; it must result in concrete measures.
I ask my noble friend to show some favour to this proposal. It is something which is attractive in trade union circles and, indeed, in progressive management circles as well. I hope that my noble friend will be able to give an indication that the Government will consider this as a matter that they might like to introduce themselves. I beg to move.
8.30 p.m.
Lord Davies of Coity: My Lords, I rise to support my noble friend Lord Wedderburn of Charlton in moving Amendment No. 226 and speaking to Amendment No. 252. I do this in the belief that these amendments will complement the Bill and will help to establish a fairer and more balanced situation.
For 30 years I was a trade union officer. Over those years a great deal of my time was spent attempting to establish a greater degree of co-operation within industry, and putting that into place, rather than widespread conflict. No one was more pleased than I when, in the mid-1990s, the trade union movement widely embraced the concept of partnership within industry. However, the question of partnership is a mechanism with a two-way flow. It offers rights to and demands responsibilities from the two sides of industry, traditionally described as capital and labour. Capital was reflected in the investment made by shareholders, while labour was reflected by employees contributing to the prosperity of the company.
It seems to me that, if it is to be worth while, consultation must take place with both sides of industry. That has been demonstrated in the Bill so far as concerns shareholders, but I think it should also reflect that consultation, information and notification to employees should take place. If we want partnership

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to be established and to work fully, that should be reflected in the legislation that we pass. We must recognise that both capital in the form of shareholders and labour in the form of employees create the prosperity that any company achieves. When it has to take decisions with regard to political donations, it is only right and proper that both sides of industry should be treated fairly; otherwise workers will think that they are not really equal partners with shareholders.
Lord Lea of Crondall: My Lords, I add my support to the amendment moved by my noble friend Lord Wedderburn of Charlton. It is perhaps a marker for the future. It is a modest proposal to add to the legitimacy of our system. The system has gained in legitimacy over recent years.
I should like to refer briefly to what happened in the mid-1980s. At that time, the Conservative government introduced a mandatory requirement for all trade unions that wished to have political funds to hold a ballot every so often to ascertain whether they wanted to continue having these funds. The expectation was that there would be some nibbling away at the degree of support and therefore at the number of trade unions that would have political funds. Let me remind the House of what actually happened: 100 per cent of unions with political funds endorsed by large majorities the principle of having political funds. If I remember correctly, some 15 trade unions which had never had political funds decided to have them. This was not specifically to do with affiliation to the Labour Party.
I do not know what the Liberal Democrats think about it, but there is a degree of argument that the Liberal Democrats, as well as the Conservative Party, would like to see more cross-fertilisation of political funding. That is a separate argument. But certainly the net result of the reforms of the mid-1980s was rather different to the intention. That added to the legitimacy of the system.
In that sense, there is less cynicism now than there was then about the political system so far as concerns financing. However, a number of questions remain, as the Neill committee discussed. The trade unions gave evidence to that committee as well as the Labour Party; the matter has been looked at quite thoroughly and the Bill is a step forward.
My noble friend's amendment does not seek to stop people making donations. I shall explain why that is not just a phrase. It is very important that the industrial interest in its broadest sense should be involved in the political arena. On all sides of the House there is now a greater balance of industrial experience than was the case 20, 30 and 40 years ago. That balance is necessary; it reflects the fact that there is nothing wrong with political donations. But when people in industry talk about a company being one big happy family and so on, anything which enables people to have a say in the political donations that are
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made is a step forward. It adds to the richness of our democracy. It gives me great pleasure to support the amendment.
Lord Bassam of Brighton: My Lords, in the view of the Government, the amendment seeks to extend the power of employees to participate in decisions of the company beyond those areas where they have a legitimate interest in so participating. I understand, of course, the enthusiasm and the loquacious elegance with which the points have been made, but that is the Government's view.
The purpose of these provisions is to ensure that, in a sensitive area of corporate governance, there are formal arrangements in effect for enabling shareholders to constrain and influence the decisions of the directors. It is the manner in which the directors dispose of the resources of the company which is in issue here. It is the shareholders who will bear the primary burden if the funds of the company are dissipated by directors on political ventures of no benefit to the company. The provisions aim to support the important monitoring role of the shareholders in this regard.
Where the shareholders exercise this control, the company and its employees will benefit. We do not think that by building in an element of what could be described as "worker participation" into these arrangements, this control on the directors' activities will be enhanced. Indeed, it may well be a case of too many cooks spoiling the broth, with another layer of monitors brought into the picture. That would seem to be the effect of the amendment.
We consider that the interests of the company, including those of its employees, are best advanced by the arrangements contained in the Bill as drafted. I urge your Lordships to reject these amendments, which would impose a further and unnecessary layer of control on the making of decisions in regard to political donations by companies.
The noble Lord, Lord Wedderburn, made the point that some of these measures would be welcomed by what he described as "progressive management". That may well be the case. If so, it is entirely a matter for companies to determine. If they wish themselves to extend the principle of participation in the making of these decisions, all well and good. We do not think that we should legislate for it; that is a matter for the companies.
`slightly regret the reaction of my noble friend, especially his phraseology. This is not a plan for "worker participation" in any sense that literature knows of the phrase. If I did not know him so well and value his friendship so much, I would say that his answer to the propositions reeked a little of the 1980s rather than 1997.
My noble friend rightly said that this is an issue of corporate governance. His brother or sister department, the Department of Trade of Industry, is in the middle of a huge debate and review of the

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company law duties of directors. At the middle of the enormous document it produced recently is the question of how far directors' duties in law should reflect duties to persons other than shareholders—to employees and to others, and, indeed, to creditors in certain situations. I regret to say that the DTI inquiry is a bit ahead of my noble friend. However, having heard what he said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.45 p.m.
Schedule 19 [Control of political donations by companies: new Part XA of Companies Act 1985]:
Lord Wedderburn of Charlton Lord Wedderburn of Charlton had given notice of his intention to move Amendment No. 227:
Page 208, line 23, leave out ("EU").
The noble Lord said: My Lords, I have taken advice and I understand that I am allowed two sentences in relation to the course that my noble friend Lord Evans of Parkside and I wish to take in regard to Amendment No. 227 and its family, if I may so refer to the groupings—other than Amendment No. 259, which again, mea culpa, should have been grouped with Amendment No. 253.
Having thought long about the matter, we believe that, because of decisions already taken in the House in regard to the Bill and because of the new government Amendments Nos. 236 and 237, it would be quite wrong to move this family of amendments—minus Amendment No. 259. We would be asking the House to contradict a number of previous tendencies and to pre-judge the debate, in certain respects, on Amendment No. 236. I seek the leave of the House not to move this family of amendments, other than Amendment No. 259.
[Amendment No. 227 not moved.]
[Amendment No. 228 not moved.]
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 229:
Page 208, line 25, leave out ("Chapter") and insert ("Part, but subsections (4) and (6A) have effect subject to section 347AA").
The noble Lord said: My Lords, the main purpose of this group of amendments is to amend the definition of an "EU political organisation" in relation to political donations by companies, in respect of both shareholder authorisation and disclosure. I shall try not to detain the House for too long, but there are some points of explanation which are important for the official record. I shall have to take a little time in moving through the group of amendments.
The drafting of the definition has raised difficult issues. The Government certainly accept that the definition must provide reasonable clarity, but, equally, we believe that it is important that there is no compromise on the issues of transparency and accountability, which lie at the heart of the Neill committee's work. We do not, for example, believe that it would be appropriate for the definition to be
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drafted in such a way that companies could make a donation without prior shareholder authorisation in circumstances where they would not want the definition to be disclosed. If the directors of a company are in reasonable doubt as to whether an organisation is "political", they should, we believe, seek shareholder authorisation for and disclose donations to that organisation.
The government amendments would make the main test in relation to the definition the intent of the organisation to affect public support for a political party or to influence voters in a referendum. This test, we believe, strikes the right balance between safeguarding the position of independent organisations which seek only to promote public debate while ensuring that the requirement cannot easily be circumvented by front organisations.
The amendment tabled by the noble Lord, Lord Blackwell, would amend the definition so that it applied to an organisation which carried on, or proposed to carry on, activities which are capable of being reasonably regarded as primarily intended to affect public support for a political party. There are two main reasons why the Government cannot support the noble Lord's amendment. In the first place, it would increase uncertainty about the interpretation of the definition. The second reason is a simple one. I believe that the test proposed by the Government is the right one. The test, based on intent to affect public support for a political party or to influence voters in a referendum, seems to us to be fair, proportionate and understandable.
The Government's amendment would also, in the interests of clarity, specifically exempt donations to all-party parliamentary groups and subscriptions to trade associations. We accept the arguments that have been put to us that all-party parliamentary groups are, by their nature, non-partisan, and that it would be harmful to the competitiveness of UK businesses to create uncertainty about the position under the Bill of subscriptions to trade associations.
I am grateful to the noble Baroness, Lady Hooper, and to the noble Lord, Lord Mackenzie of Framwellgate, for tabling an amendment which appears to signify their consent to the Government's proposal. I apologise to them if I have misconstrued their purpose.
Amendment No. 234 seeks to amend the definition of "EU political expenditure" so that it covers any expenditure incurred by companies in respect of activities which could reasonably be regarded as intended to affect public support for a political party or organisation or to influence voters in a referendum. The amendment would bring the definition of political expenditure into line with the amended definition of a political organisation; in particular, it would ensure that companies would be required to seek shareholder authorisation for political expenditure in relation to a national or regional referendum.
The Government are conscious, however, that some companies carry on business activities which may, by their very nature, involve the publication or

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dissemination of material which seeks to influence the views of members of the public: journalism is an obvious example. It is, therefore, our intention to table an amendment for debate at Third Reading providing that these controls will not apply to these forms of business activities.
The other main purpose of this group of amendments is to introduce a £5,000 de minimis threshold in relation to shareholder authorisation. The Government accept that, on practical grounds, there is a strong case for an annual de minimis threshold of £5,000 in relation to authorisation. It is possible, for example, that a company may wish to make a very small sponsorship payment in the course of a financial year which it had not anticipated at the time of its annual general meeting. This proposal would provide some flexibility in this regard. I beg to move.
On Question, amendment agreed to.
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendments Nos. 230 and 231:
Page 208, line 29, after (" 48") insert (", 49").
Page 208, line 32, leave out (", (6) and") and insert ("to").
On Question, amendments agreed to.
[Amendments Nos. 232 and 233 not moved.]
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 234:
Page 208, line 45, at end insert (", or in respect of any activities on the part of the company such as are mentioned in subsection (6A)(b) or (c)").
On Question, amendment agreed to.
[Amendment No. 235 not moved.]
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 236:
Page 209, leave out lines 1 and 2 and insert—
("(b) any other organisation to which subsection (6A) applies.
(6A) This subsection applies to an organisation if—

(a) it is a political party which carries on, or proposes to carry on, activities for the purpose of or in connection with the participation of the party in any election or elections to public office held in a member State other than the United Kingdom;

(b) it carries on, or proposes to carry on, activities which are capable of being reasonably regarded as intended to affect public support for—

(i) any registered party,

(ii) any other political party within paragraph (a), or

(iii) independent candidates at any election or elections of the kind mentioned in that paragraph; or

(c) it carries on, or proposes to carry on, activities which are capable of being reasonably regarded as intended to influence voters in relation to any national or regional referendum held under the law of any member State.

(6B) "Organisation" includes any body corporate and any combination of persons or other unincorporated association.
(6C) "Registered party" means a party registered under Part II of the Political Parties, Elections and Referendums Act 2000.").
The noble Lord said: My Lords, I have spoken to this amendment. I beg to move.
Lord Blackwell Lord Blackwell moved, as an amendment to Amendment No. 236, Amendment No. 236A:
Line 9, after ("as") insert ("primarily").
The noble Lord said: My Lords, I welcome Amendment No. 236 as a step forward from where we were at the previous stage of the Bill. Once again, I declare an interest as the chairman of the Centre for Policy Studies, which is an independent think-tank.
The difficulty that I have with the wording of Amendment No. 236 as it stands is that it leaves a grey area in regard to what is or is not a political organisation. I refer in particular to paragraph (6A)(b), which refers to a political organisation as one which,
"carries on, or proposes to carry on, activities which are capable of being … regarded as intended to affect public support for … any registered party".
Any publication of a policy document might be regarded as having, as one of its consequences, an effect on public support for a registered political party. Let us suppose that an organisation publishes a critique on an aspect of public policy, part of which is critical of current government policy in that area. That might be regarded as "intended to affect public support" for that policy and, therefore, for the party advancing it. However, it seems to me that publishing a reasoned view on a policy area is not intended to be captured under the Government's amendment as a party-political activity or that donors to that group should be regarded as giving money to a party-political group.
My amendment therefore seeks to insert the word "primarily" into sub-paragraph (b) of the amendment. That would make it clear that, in publishing a policy critique setting out views that were different from those of the government or alternative groups, so long as the prime intent was to advance argument about the policy, it would not be captured by this provision; whereas if the intent and the wording were reasonably regarded as "primarily" intended to affect political support for the party, that would place it in a different category. My amendment is simply intended to move the line slightly out of the grey area and make it clearer that the Government are after organisations that are primarily about canvassing support for political parties or a political point of view.
I believe the Minister said that he was not very keen on my amendment. However, in the light of my remarks perhaps he will take a different view and will reconsider the matter before the next stage of the Bill. I beg to move.
Lord McNally: My Lords, my noble friend Lord Newby has added his name to this amendment. He is the chairman of the Centre for Reform, another think-tank. I do not want to add much to what the noble Lord, Lord Blackwell, has said. He set out very clearly the case that is made by the think-tanks. Frankly, like the noble Lord, I was slightly surprised that the

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Minister "got in quick" with his rejection of a "one-word amendment" which would give a little more elbow-room. Quite honestly, I think that the Minister is straining at gnats not to accept this amendment. I ask him to reconsider what the noble Lord, Lord Blackwell, said and ponder on the matter. This is a concession that the Government could very easily make.
My noble friend Lord Newby, who, unfortunately, cannot be here this evening, asked me to say how much the approach that the Government have taken on the matter is appreciated. In terms of general welcomes, perhaps I may also say that I was lobbied by the North West Pharmaceutical Group to support the amendment of the noble Baroness, Lady Hooper, just in case the government amendment failed. Obviously, the group does not have as much confidence in the Government Whips as I have. The lobbying brief says that if the government amendment succeeded, those concerned would be content.
Lord Wedderburn of Charlton: My Lords, the amendment raises an important issue. It goes to what is intended by those who are carrying on such activities. First, there is no more difficult problem than to decide what is intended by people, although it can be done. But various areas of the law show that determination of the "primary" intention—or, perhaps, in some cases, the "dominant" intention—causes an enormous amount of work for lawyers. Therefore, I would be against the amendment on that ground.
Lord Dubs: My Lords, I listened most carefully to the introductory remarks of the noble Lord, Lord Blackwell, and, indeed, to the subsequent comments. I should declare an interest at this point because I serve on the executive of the Fabian Society. I should have thought that the word "primarily" would help organisations that publish documents or pamphlets dealing with political issues, or put forward options for the sake of consideration by political parties, and by others. I have in mind organisations like the Fabian Society that organise workshops and seminars, all of which are intended to highlight political issues and lead to more informed debate.
Those activities might indirectly be construed as affecting political support for a registered party, but, in practice, we know that that is not what they are really about; they are about informed, sensible political discussion. As I say, I believe that the addition of the word "primarily" would help. It would clarify matters and make the understanding of them much easier. Therefore, I hope that my noble friend the Minister will think again. As has been said, it is a very small amendment but one which would help organisations like the Fabian Society, and others.
Lord Bassam of Brighton: My Lords, my answer to the noble Lord, Lord McNally, is that one word can make a lot of difference. Unfortunately, that is the case with the amendment now before us. I am extraordinarily sympathetic in this respect. Before I
916
continue, perhaps I should declare that I am a member of the Fabian Society. In fact, I ought to have declared that interest before. It was just an oversight on my part. I must make that point clear.
The problem here is, first, that the amendment tends to muddy the waters. I believe that it would make the definition less clear. Secondly, as I said earlier, a test based on intent to affect the way in which people vote appears from the Government's point of view to be only fair and proportionate. Those are the two reasons why we cannot be as helpful as the noble Lord, Lord Blackwell, would wish. I shall, of course, study what the noble Lord said with care. I shall also take careful cognisance of the Hansard report. But no more than that can I promise. We have probably been as helpful as we possibly can.
I well respect the work that all these valuable and valid organisations undertake, as do the Government. I am sorry that I cannot be more helpful. As I said, I shall read the Hansard report and study it most carefully to ascertain what further assistance we can render. However, as I said, I can promise nothing more.
Lord Blackwell: My Lords, I am most grateful to the Minister for his response. This is not an issue that I wish to press at this stage. However, I welcome the noble Lord's offer to reconsider the matter. Perhaps between now and the final stage of the Bill we can discuss the matter further. I beg leave to withdraw the amendment.
Amendment No. 236A, as an amendment to Amendment No. 236, by leave, withdrawn.
On Question, Amendment No. 236 agreed to.
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 237:
Page 209, line 9, at end insert—
("Exemptions.
347AA.—(1) Section 347A(4) does not extend to a subscription paid to an EU trade association for membership of the association, and accordingly such a payment is not a donation to the association for the purposes of this Part.
(2) In subsection (1)—
"EU trade association" means any organisation formed for the purpose of furthering the trade interests—

(a) of its members, or

(b) of persons represented by its members,

which carries on its activities wholly or mainly in one or more of the member States;
"subscription", in relation to a trade association, does not include any payment to the association to the extent that it is made for the purpose of financing any particular activity of the association.
(3) Section 347A(6A) does not apply to any all-party parliamentary group composed of members of one or both of the Houses of Parliament (or of such members and other persons), and accordingly any such group is not an EU political organisation for the purposes of this Part.
(4) For the purposes of this Part—

(a) a company does not need to be authorised as mentioned in section 347B(1) or section 347C(2) or (3), and

917

(b) a subsidiary undertaking does not need to be authorised as mentioned in section 347D(2),.

in connection with any donation or donations to any EU political organisation or organisations made in a particular qualifying period, except to the extent (if any) that the amount or aggregate amount of any such donation or donations made in that period exceeds £5,000.
(5) The restrictions imposed by sections 347B(1), 347C(2) and (3) and 347D(2) accordingly have effect subject to subsection (4); and, where a resolution is passed for the purposes of any of those provisions, any amount of donations in relation to which, by virtue of subsection (4), no authorisation is needed shall accordingly not count towards the sum specified in the resolution.
(6) In subsection (4) "qualifying period" means—

(a) the period of 12 months beginning with the relevant date for the company or (in the case of a subsidiary undertaking) the parent company; and

(b) each succeeding period of twelve months.

(7) For the purposes of subsection (6) the relevant date for a company is—

(a) if an annual general meeting of the company is held within the period of 12 months beginning with the date of the coming into force of this section, the date of that meeting; and

(b) otherwise, the date immediately following the end of that period.").

The noble Lord said: My Lords, I beg to move formally.
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved, as an amendment to Amendment No. 237, Amendment No. 237A:
Line 26, leave out ("does not need to") and insert ("must").
The noble Lord said: My Lords, in moving this amendment, I shall speak also to Amendments Nos. 237B to 237D. I apprehend that I have done my case no good, despite the hour of the night, by going too fast. Therefore, I should like the House to pause and consider what is involved in this the latest of the Government's amendments. If I am not mistaken, it was tabled last Wednesday. It would reverse a central part of what has been the jewel in the crown of this Bill. Indeed, I referred to it when I argued that employees should have, not participation—I insist, again—but merely a voice in respect of these matters regarding political donations.
Where are we at present? We have reached the point where directors have decided that they want to propose to use part of the company's funds, which have probably been raised for commercial and similar purposes, for political donations. They will have been wise enough to have that capability put in the memorandum of association, and everywhere else that is necessary; for example, in the articles, and so on. But this is a step that the Government's Bill has surrounded with some 10 or 15 pages of print in Schedule 19.
Those pages in Schedule 19 contain checks and balances, to which I referred previously. They are, first, that the procedure must be entered into and completed and put to the shareholders at a general meeting for approval. Specific sections are added to ensure that that is done properly where there is a holding company and a subsidiary company. Moreover, as one goes through the pages, a procedure
918
is invented whereby the shareholders can go to court and obtain a court order against the directors to replace the money if they have not gone through the proper process. Even I thought that that was a bit harsh. But then I came across the various defences that the schedule provides for such directors, which are probably quite reasonable.
However, as I said, this amendment was tabled only last week, after the Government had had nearly two years to consider the matter. It was put down without explanation; indeed, the only explanation that we shall have about it will be what my noble friend said tonight in his introduction. If I may say so, he did not speak at length to Amendment No. 236. This central mechanism, which is new to our law and which was so much the Government's prize in the schedule, is to be removed. Previous amendments allow for a donation to a party in this country or in the European Union. I spoke to that matter once before in these proceedings and pointed out that it would allow donations to M le Pen's party and all the other parties I rather dislike, such as Mr Haider's party in Austria. But I object just as much if a company is able to give money to the French socialist party without—as the schedule would have demanded—putting that to the shareholders at a general meeting. I appreciate, of course, that as regards a large public company, the shareholders are, in effect, the financial institutions. I do not mind that. The whole point is that those procedures would give publicity to the matter. I apprehend that if we had discussed companies making payments to defend apartheid some five or 10 years ago, there would have been solid approval of the need to put that to a shareholders' meeting.
This measure constitutes a major change in government policy. The sum of £4,999 every year is not a small amount of money. I recall that my noble friend Lady Gould talked of the difficulty that local parties have in raising small sums. We all know that that is true.
I do not understand how my noble friend can ask us to approve Amendment No. 237, which introduces a whole new section 347AA. I suggest leaving out the provision about not needing to get approval and introducing the word "must" in relation to getting approval. I am grateful to officials in the Public Bill Office for their help but I suspect that the amendment I am discussing is a wrecking amendment and that I should vote against it. However, it is on the Marshalled List and therefore I am home and dry.
There should be shareholders' approval for the measure we are discussing. The Government have always believed that there should be shareholders' approval. That leads me to ask how my noble friend can put this measure to us now. On what grounds does he do that? Who thought of the idea? Who put it to the Government that one should remove this major mechanism for greater publicity, which is the whole point of shareholders' meetings? Who thought it up? Was it thought up by the Government? Amendment No. 237D would reduce the amount that could be used

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in this way by the directors at their whim, without it being subject to any control whatever, down to £50 as opposed to £5,000.
I stop there although there is much more to say about this venture of the Government's. Why was it not tabled in another place? What was wrong with the idea then? The matter was carefully considered in another place. This is not a case of this House not having the opportunity to consider the most careful debates that took place in Standing Committee G. There was not a murmur of this proposal. Indeed, in those debates the Government were proud—as well they should have been—to introduce the new mechanism. I do not understand—and many members of our party will not understand—why the Government have suddenly decided to remove this mechanism (which has gained some publicity and support for the party) and impose a cut-off point of £5,000. I wonder why they chose the sum of £5,000. Are shareholders not interested in anything less or more? Of course, that is absurd. I am amazed at this proposal, which was tabled only last week. I ask my noble friend the direct question: who thought it up and what are the grounds for it? I beg to move.
Lord Bassam of Brighton: My Lords, I refer to one of the important principles and approaches that we have attempted to embrace during the course of the development of the Bill. I think that one has to accept that the Bill has developed. That charge has been levelled rather more sharply against the Government on occasion, and from time to time by the noble Lord, Lord Mackay. One of the important ways we should approach the Bill is to try to be as consensual as we can because we need a system of regulation that we can in the main all sign up to.
The £5,000 de minimis limit is a response to representations that we have received from both sides of the House. The limit is an aggregate figure covering all political donations made in any year. The de minimis limit reflects the fact that companies may make innocent donations, for example, to think tanks. We do not want these provisions inadvertently to affect adversely such activities. The noble Lord, Lord Mackay, tabled a similar amendment in Committee.
We believe that our amendment provides a small measure of flexibility so that companies do not have to call extraordinary general meetings for what one might describe as fairly modest donations. My suspicion is that most donations will probably be larger than £5,000 and attract some attendant publicity. There is an organisation which regularly monitors party political or similar donations. The Labour Research Department produces an excellent publication which does exactly that. I do not think that political donations will be without publicity, interest or disclosure.
We have approached the issue on a consensual basis. I am sorry that the noble Lord was not aware of earlier similar amendments. Yes, we have had representations from a range of organisations and political parties. That is the cause underlying the amendment. We do not seek to undermine the general principle behind
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disclosure; far from it. We have been frank about that. It is a matter of practicality. If we were to go down to the level of the £50 suggested by the noble Lord in one of his amendments it would be the sledgehammer to crack a nut syndrome.
I understand the logic of the noble Lord's argument. However, I respectfully ask him to withdraw the amendment.
9.15 p.m.
Lord Goodhart: My Lords, before the Minister sits down, the £5,000 figure is the same as the figure which has to be disclosed for donations to a national political party. I assume that that is no coincidence. But there is also a requirement that donations of more than £1,000 in relation to a single constituency organisation should be disclosed. Therefore would not it he appropriate to reduce the £5,000 level to £1,000 to make sure that anything which has to be disclosed under this Bill also has to be approved by the shareholders?
Lord Bassam of Brighton: My Lords, I do not entirely follow the noble Lord's logic though I can see where he is coming from. Shareholders are entitled to be told about all except the very smallest of donations; and there is no reason to amend the current disclosure threshold of £200. If a company donates £1,000 to a constituency association it would still be able to be disclosed under Part IV of the Bill. So there is already provision in place for that eventuality.
Lord Wedderburn of Charlton: My Lords, I, and many others, will read very carefully my noble friend's remarks in Hansard. The noble Lord is right to say that a report must appear in the director's report of all political donations over £200. The argument of the noble Lord, Lord Goodhart, that there are grounds for choosing £1,000 seems to have some strength.
The figure of £5,000 apparently comes from some anonymous representations from political parties As I was unable to attend the House, I read the Official Report in bed. I do not remember this precise point being made in Committee. If the Minister writes to me with a reference—he has kindly done so previously—I shall be interested to read it.
Of course I shall beg leave to withdraw the amendment. However, if what I think was said appears in Hansard there will be a considerable amount of dislike within his own party. It is true that if one is a subscriber one can gain these figures from the research undertaken by the Labour Party research department. I suspect that few people here read such publications. I congratulate the noble Lord, Lord Goodhart, on being an avid reader of the Labour Research Department's publications. My noble friend must understand that the provision removes any shareholder control in relation to the figure of f5.000 a year, every year. The figure will appear in the report of the directors, but no more. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.

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[Amendments Nos. 237B to 237D, as amendments to Amendment No. 237, not moved.]
On Question, Amendment No. 237 agreed to.
[Amendments Nos. 237E to 241 not moved.]
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 242:
Page 209, line 25, leave out from ("means") to end of line 29 and insert ("a special resolution").
The noble Lord said: My Lords, I shall speak also to Amendments Nos. 243, 244, 247 and 250. The amendments can be dealt with quickly. They relate to two points of company law.
The first is the procedure when a matter comes before a shareholders' meeting. As the Bill stands, approval can be given by an ordinary resolution, a special resolution, any other means allowed by the articles of association or—this is what I object to—a mechanism determined by the directors. The issue is whether the shareholders will approve of the donations proposed by the directors. It is therefore improper for the directors to be in charge of the way in which the shareholders' meeting must give that approval. I would have thought that that was elementary.
Since the turn of the century, important decisions relating to a company, such as a change of the articles, have had to be made by a special resolution that must be passed by a three-quarters majority with 21 days' notice. That is set down in the Companies Act 1985. Under Amendment No. 242, that would be the only way of approving of a donation.
The other amendments cover a technical point. I congratulate the Government that the Bill prevents the method of ratification by shareholders from curing a breach of their duties if the directors are in breach. There is also a line of authority, particularly in the court's decision in Re Duomatic, whereby many decisions have accepted informal unanimous acquiescence of shareholders as equivalent, although not identical, to ratification. That is why Amendment No. 244 would include:
"any formal or informal unanimous acquiescence or agreement".
I beg to move.
Lord Bassam of Brighton: My Lords, the Government do not accept the amendments. In the first place, they would require companies wishing to make political donations to table a special resolution. We do not believe that that would be appropriate, given that a special resolution is required under the Companies Act 1985 only when fundamental changes, such as the alteration of the articles of association, are proposed. The Bill allows companies to require a higher voting majority for such resolutions by modifying their articles or by directors' determination.
Another aim of the amendments is to ensure that retrospective unanimous consent by shareholders to a donation made without their approval, however expressed, would not relieve the directors of the consequences of contravention. We believe that the
922
amendment is unnecessary, as the wording that the noble Lord seeks to amend is sufficiently wide to include all forms of approval, formal or informal, given by shareholders to prior director action. Indeed, specifying a particular means of approval may cast doubt on the width of the words,
"no ratification or other approval made or given by the company or its members".
Having heard that explanation and the assurances on the construction of the relevant provision, I hope that the noble Lord will feel able to withdraw the amendment.
Lord Wedderburn of Charlton: My Lords, I am sorry about my noble friend's first point, but I shall leave it. As to the second point—that approval or ratification must include unanimous acquiescence—I do not know what to do. I can only refer him to the judgment in Multinational Gas v. Multinational Gas Services in 1983 in the first volume of Chancery 258 in the Court of Appeal. He will see that, unless one deliberately inserts the words "informal acquiescence" as well as "formal ratification or approval", one is very much at risk of a court accepting the argument that informal acquiescence is sufficient. I can say no more than that and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 243 to 250 not moved.]
Lord Bach Lord Bach moved Amendment No. 251:
Page 213, line 19, leave out ("otherwise than as mentioned in section 347F(1)") and insert ("without having been authorised as mentioned in section 347D(2)").
On Question, amendment agreed to.
[Amendment No. 252 not moved.]
Clause 137 [Disclosure of political donations and expenditure in directors' report]:
Lord Wedderburn of Charlton Lord Wedderburn of Charlton moved Amendment No. 253:
Page 101, line 27, leave out ("registered party") and insert ("political party, wherever situated.").
The noble Lord said: My Lords, there will probably be some mysterious reason why this amendment is not acceptable, but I shall set out what it seeks to achieve. As the law stands at present, there is one system of entering into the directors' report donations made by the company for political or charitable purposes. I expected that the Government would leave, but amend and bring up to date, that method, which is set out in Schedule 7 to the Companies Act 1985. However, the Government have not done so. Indeed, it was pointed out in a research paper for another place that Clause 129 proposes,
"two new disclosure regimes for political donations and expenditure within the UK/EU area and for political contributions in the rest of the world".
I appreciate that some noble Lords may become confused and believe that I am repeating a point made in relation to permissible donors. I am not. This has nothing whatever to do with the previous debates about the European Union. The question raised by my amendment is: what ground is there for changing the

923
system of reporting political donations into a dual system, which is brought about by Clause 137? They are similar systems. It is simply that one is drafted for the UK and EU and is slightly more regulatory but scarcely more so than the one which is drafted for new paragraph (4) of the Companies Act schedule for political contributions in the rest of the world.
Would it not be better to have less red tape and to leave one system for disclosure in the directors' report? We have chosen to amend the first system that the Government propose so that everything is covered. It seems to us rather better drafted than the second one because the second one refers to "contributions" rather than "payments" and has problems in that respect. I simply ask the Minister whether we could have rather less of the Bill in this case and have one system for reporting in directors' reports that covers every donation, whomever they are to and in whatever manner the directors propose to make them.
Lord Bassam of Brighton: My Lords, the Government have adopted the same pragmatic response to disclosure as they have to shareholder authorisation. In the light of the responses to their consultation, the Government have decided to apply the full disclosure regime only in respect of donations to EU political organisations or EU political expenditure. However, the Bill would require companies which made political donations outside the European Union to disclose a single aggregate figure in respect of monetary donations to overseas political parties. We feel that that would best provide for the situation which I believe is envisaged by my noble friend and provide a warning flag to investors if companies were making substantial overseas donations.
The other points which my noble friend made were covered in some of our earlier debates. Therefore, I do not need to respond to those. But if there is something that I have missed, I shall certainly pick that up at a later stage, having noted carefully what my noble friend said.
9.30 p.m.
Lord Wedderburn of Charlton: My Lords, I am grateful to my noble friend for saying that he will look again at some of the matters concerned. It has nothing whatever to do with any of the previous debates. It is a question of what the Bill says about what directors should put into their reports about donations.
The Government have invented an extremely regulatory system for donations relating to the United Kingdom or Europe and a rather less clear and less regulatory system for donations made anywhere else. Donations to Sweden will go in one director's report; for donations to Norway, something rather different is in place. I cannot understand why that is so.
My noble friend seemed to say that the Government have had consultations but we are not told with whom and in regard to what propositions. He concluded by saying, "We think this is the best way of doing things". I asked why and my noble friend, with great respect to
924
him—and I value his friendship very greatly—did not give me any reason at all for the division of paragraphs 3 and 4 of Schedule 7 into two different methods. I hope that he will think again. It would be easier for directors to operate if they knew which system they had to follow if, for example, they are giving one donation in respect of Australia and another in respect of Austria or France. But, obviously, I must beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 254 to 256 not moved.]
The Deputy Speaker (Lord Lyell): My Lords, I must advise your Lordships that, if Amendment No. 257 is agreed to, I would not be able to call Amendment No. 258.
Lord Bach Lord Bach moved Amendment No. 257:
Page 102, leave out lines 18 and 19 and insert ("Part XA of this Act has the same meaning as in that Part").
On Question, amendment agreed to.
[Amendments Nos. 258 and 259 not moved.]
Lord Bach Lord Bach moved Amendment No. 260:
Page 102, line 49, leave out ("European Union") and insert ("member States").
On Question, amendment agreed to.
[Amendment No. 261 not moved.]
Clause 138 [Reduction of qualifying period for overseas electors]:
Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 262:
Page 103, line 41, leave out ("10") and insert ("15").
The noble Lord said: My Lords, as Members of your Lordships' House will recall, when we were discussing this part of the Bill at an earlier stage a wide range of views were expressed. It was difficult to see exactly what sort of consensus we would reach. Obviously, in government we have tried to proceed on the basis of reasonable consensus. We face a difficulty in that we must match some of the aspirations of another place, through the Home Affairs Select Committee and its report and findings on these matters, and a desire to reduce the number of years for which people may continue to claim a vote when they are living overseas.
On the other hand, we must respect the fact t hat many people who live overseas working for government, industry, business and commerce generally wish to play a full and active part in political life here and certainly wish to retain the right to vote.
So, having initially reduced the period to 10 years in our provisions, we took the view that we might be able to satisfy some of the understandable concerns which were being expressed, not least by the new friend of Socialist International, the noble Lord, Lord Mackay of Ardbrecknish, who was extremely persuasive on this matter. We thought that we should move somewhat in his direction and the direction of other Members of your Lordships' House by offering 15 years as a form of compromise. That is our amendment. I hope that the House will feel able to

925
support it. It will not satisfy everybody in every respect. I realise that it represents a broad brush approach. However, we think that it is probably the most equitable approach that we can adopt. We hope that it finds favour this evening. I beg to move.
Lord Goodhart: My Lords, my Amendment No. 263 is grouped with this amendment. I spoke to it in Committee. It seemed that there was a strong case for treating those in the service of international organisations of which the UK is a member—not only the institutions of the European Union but also organisations such as United Nations, the World Trade Organisation, the World Bank and the IMF—as equivalent to being in the public service of the Crown. I have again tabled the amendment on Report because, as a result of the debate in Committee, it seemed that there was a possibility of the Government accepting a package deal which would include the use-it-or-lose-it amendment of the noble Lord, Lord Mackay, and our own amendment on public service in EU institutions and other international bodies.
However, it appears that this amendment has not found favour with the Government. It is not an amendment that we could force against the wishes of a reluctant Government. Third Reading already looks like being very long. Therefore, with regret, if the Government are not willing to be more helpful than they have so far been, I am afraid that we shall have to say goodbye to this amendment.
Lord Hodgson of Astley Abbots: My Lords, I shall be brief. As midnight approached last night, somewhat to my shame I described the Minister's reaction to an amendment that I had moved as "ungenerous". He may now feel that what I am about to say is ungenerous to him, and I accept that.
Naturally, I welcome the move that he has made. It is a step in the right direction. He has described his wish to find something that is clean and neat. I believe that this is clean and neat. However, it is still artificial. It is artificial against a background of increasing labour mobility. People will spend more and more of their time working outside this country, particularly as the single market in the European Union develops. Companies which hitherto would have seen their operations as entirely confined to the United Kingdom will increasingly have at least a European, and sometimes a world, dimension to them. Members of their staff may work overseas for very long periods. Some of them, of course, will enjoy working overseas. The relative freedom of working in smaller subsidiaries is attractive. In addition, they may wish to take into account the climate, though I am not clear as to why anyone should prefer the sunshine of southern Spain to a British winter! Both categories are made up of people who see themselves as British and intend eventually to return to the UK.
In the meantime, many of them will be paying tax and, therefore, contributing to our economy and to the welfare of this country. I therefore believe that they are entitled to representation here. Confusion has existed
926
between residence and domicile. Residence can easily be changed, domicile cannot. Domicile requires a conscious effort on the part of people to demonstrate that they intend to live out their lives abroad. Without this, the Inland Revenue, in its inimitable fashion, can obtain estate duty on assets held in the United Kingdom. The purpose of this is to show that there is no neat and clean solution.
I accept the Minister's amendment. I am grateful to him for the move that he has made. However, I feel that people who pay UK tax and work overseas should have representation and be able to vote in our elections.
Lord Wedderburn of Charlton: My Lords, I know of somebody who is in exactly the same position as that described by the noble Lord, Lord Goodhart. I support the amendment.
Lord Mackay of Ardbrecknish: My Lords, perhaps I may say, briefly, that I am rather cynically bagging the noble Lord's compromise. I have listened to the debate. I shall reflect overnight on whether a more wide-ranging amendment should be considered on Monday. However, I am grateful to the Minister for looking for a compromise, as I have been trying to do for most of today.
Lord Bassam of Brighton: My Lords, the noble Lord, Lord Mackay, as a great compromiser is a good notion. Briefly, perhaps I may refer to a problem with the amendment tabled by the noble Lord, Lord Goodhart. We could include public servants working abroad but, if we do that, what about people who work for BP, AMOCO, or some other corporation, multinational or other part of public service? Where do we start and where do we stop? The list could go on. We think that our amendment is broad-brushed, clean, neat and simple. It almost goes back to what was there before. We feel that that is the best approach.
I am grateful to the noble Lord, Lord Hodgson, for his kind comments: I think they were kind. We think that this is probably as good as we shall get. One must have a sense of proportion about this matter. The noble Lord is right; the labour market will be more flexible and mobile. At the last count, some 14,000 people abroad exercised their right to register and vote in UK elections. We shall try to help all those people with this approach. I am glad that it seems to be finding broader favour in your Lordships' House.
On Question, amendment agreed to.
[Amendment No. 263 not moved.]
Lord Graham of Edmonton Lord Graham of Edmonton moved Amendment No. 264:
After Clause 138, insert the following new clause—
("Parish polls

Political Parties, Elections and Referendums Bill

  PARISH POLLS: THRESHOLD
  . In sub-paragraph (4) of Schedule 12 to the Local Government Act 1972 for the words "ten, or one third of the local government electors present at the meeting" there is substituted "fifty local government electors present at the meeting or 2 per cent. of the electorate".").
  The noble Lord said: My Lords, I rise to move Amendment No. 264. Hitherto in discussing referendums in the Bill, we have talked about large scale referendums. I want briefly to concentrate on referendums which are on a small scale.
  Amendment No. 264 deals with the threshold for parish polls. I have a very good friend in the Commons, Bill Rammell, who is the MP for Harlow. He told me of a situation in his constituency drawn to his attention by Mr Ed Borton, the parish council chairman of the village of Nazeing. I am told that a local resident, acting independently of the parish council, summoned a formal parish meeting under the Local Government Act 1972.
  His purpose was not to discuss key issues of concern, such as local vandalism, changes in rural bus services or the contentious question of whether or not Epping Forest council uses its powers of planning enforcement fairly. He called the meeting to ask for a ballot on the question,
  "Do you want to keep the pound sterling as the currency of the United Kingdom?"
  We all have a view on that question. After the next election, this Government may well take steps to provide everybody in the country with the opportunity to answer it. However, the case which I make, as does Mr Borton and the National Association of Local Councils, is that this is an abuse of the use of the Local Government Act and the power of parish councils. To ask that question would have cost the ratepayers of that area £1,587.
  The amendment is not about Europe. It does not stray into any other big field. It argues about the sense or nonsense of the trigger which allows parish polls to be carried out. As my amendment shows, if a meeting is called at which half a dozen of the local government electors are present, a third—that is two—can trigger a parish poll. That would involve wasteful expenditure.
  In the parish of Frinton and Walton in Essex, which is well known to me and others, a resident threatened to call a parish poll at a cost to the parish of £3,500 unless the council agreed not to spend money on a new badge for its mayor. That cannot be a proper use of a poll. Duston parish in Northampton was recently subjected to a poll on a planning issue. The poll was called by just one person and cost the council and hence the taxpayers well over £5,500.
  This amendment says that we should be realistic and sensitive to expenditure which is not necessarily needlessly incurred, but which is incurred through incorrect use of the mechanism. I suggest that there should be at least 50 local electors present and not one third of just six or seven; or, alternatively, 2 per cent of the electorate. That would be a powerful barrier to people fecklessly or recklessly seeking to call for that money to be spent.
  The National Association of Local Councils has represented parish and town councils for over 100
  928
  years. Today I received a letter from John Findlay, its chief executive, in which he says,
  "The legislation as it stands does not require such groups to demonstrate any significant public support for the poll, yet the cost to the local community can be as much as £7,000, depending on the size of the electorate".
  Therefore, while I am speaking on behalf of my friends Bill Rammell, the MP for Harlow, and Ed Borton, the chairman of the parish council, the amendment also has the backing of the whole of local government at that level. Their views should be heard and I hope that the Minister will recognise that we are taking this opportunity to air them.
  This Bill may not be the right vehicle and it may not be the right amendment. But if the Minister indicates sympathy for the principle—that is, to take away the power from people who may have the best of intentions but who needlessly call polls—then those outside the House and myself will be satisfied. I beg to move.
  9.45 p.m.
  Lord Rennard: My Lords, I should like briefly to support Amendment No. 264. I concur entirely with the comments of the noble Lord, Lord Graham of Edmonton.
  I have considerable scepticism of the democratic worth of referendums, but even they can be abused if it is too easy to call a referendum and thus incur considerable local costs. It may be, for example, that there is considerable local controversy as to whether or not to fill in the local duck pond, and that question may well best be settled by the holding of a parish poll. However, when questions are raised of the sort referred to by the noble Lord—indeed, I believe there is a euro-sceptic campaign to try to abuse the parish poll process to air issues which are totally inappropriate for parish polls—it is much more sensible to raise the threshold to perhaps 50 electors attending or 2 per cent of the electorate signing that they would like such a parish poll before their money can be spent on polls of that nature.
  Lord Graham of Edmonton: My Lords, those who raise the issue of the duck pond must be "quackeirs"!
  Lord Bach: My Lords, perhaps I can intervene before any more remarks of that kind are made.
  Although he is not in his place, my noble friend Lord Bassam has told this House on more than one occasion that he was introduced to politics by a parish poll in the village in which he then lived. I, as a parish councillor over the past few years, was involved in a parish poll, which we lost, as to where a leisure centre should be sited. So such polls have a value.
  However, we have real sympathy with the concerns of my noble friend Lord Graham of Edmonton in relation to parish and town council polls. We too are aware of the recent events where a local group sought to use them to pursue its aims on the European single currency and I say no more about that.

  929
  The situation concerning those polls has shown that there is indeed a lack of clarity as to precisely when it is legal for polls to be called and it has given rise to real problems of uncertainty for parish clerks. It is they who must decide if a specific poll is a legitimate use of what are, after all, public funds provided by their community council's taxpayers.
  We are clear about two things. First, that parish polls can be a legitimate and effective way in which local people can rightly have a say about local issues which are vital to their communities and day-to-day lives. We want to see stronger democratic local governance, and parish polls can be part of that.
  Secondly, we are equally clear that it is an abuse for pressure groups to seek to further their aims at public expense, and some of the attempts to try to use parish polls do not seem to be anything else than such an attempt.
  We are therefore sympathetic to any measures which would strengthen the parish poll provisions and render them less susceptible to misuse. Indeed, given the recent events, we have received a number of representations on behalf of town and parish councils asking us to do just that. We have been asked to consider raising the threshold in order to prevent abuse of the current rules. We have been asked about the kind of questions which parish polls can be used to decide.
  What has not been made clear to us is what any higher threshold should be. Nor is there clear consensus about what questions a parish poll should be able to cover. So while the principles of how we should approach parish polls are clear, the details of how to achieve them are not. However, my noble friend's amendment puts forward what the House may consider to be a sensible view of the level of support that should be received.
  For those reasons, we cannot accept the particular suggestions that my noble friend makes tonight. But I can say that as the Government take forward their rural policies we will examine and consult widely on how the important parish polls provisions should be reformed so as on the one hand to provide certainty and prevent abuse and on the other to allow local people to have a real say about local issues which really matter.
  We believe that there should be robust and effective parish poll provisions. The whole House will be grateful to my noble friend for having raised the matter tonight.
  Lord Graham of Edmonton: My Lords, I sense that that is the best offer I shall have tonight. I accept it with gratitude and beg leave to withdraw my amendment.
  Amendment, by leave, withdrawn.
  Schedule 20 [Penalties]:
  [Amendment No. 265 not moved.]
  Clause 153 [Orders and regulations]:
  Lord Mackay of Ardbrecknish Lord Mackay of Ardbrecknish moved Amendment No. 266:
  Page 116, line 2, leave out ("or 159(2)").
  The noble Lord said: My Lords, in moving Amendment No. 266 I shall speak to Amendments Nos. 267 and 269. Amendment No. 269 contains an error; the second line should read "section 159(5)".
  In case your Lordships thought that during the past hour I had taken a vow of silence, I feel that I should make this final contribution to the Report stage. The amendment relates to the commencement orders bringing into force the various parts of the Bill. As presently drafted, there is no provision for parliamentary scrutiny of such orders. As the Minister has admitted, it is a distinct possibility that there will be a general election less than 12 months after the provisions of the Bill relating to expenditure limits come into force. In such a case, I think that it is the Government's intention to use the powers in Clause 159(5) to alter the political parties' expenditure limits when they make the commencement order so that the limits are reduced to take account of the shorter period between the commencement of Part V and the day of the poll.
  I have no objection to that in principle. However, I am concerned that any reduced limit should be weighted to take into account that the vast majority of parties' expenditure takes place in the few weeks immediately prior to a general election. In other words, I do not want £20 million to be divided into 12 and the necessary months given the one-twelfth. I should probably have fair agreement on that.
  I believe that it is the Government's intention after Royal Assent to seek the views of political parties on the appropriate level of the reduced expenditure. However, the reduced expenditure limits are important. At present, there is no mechanism in the Bill for Parliament to discuss them after they have been agreed. My amendment would provide that a commencement order which varies the election expenditure limits would be subject to the affirmative resolution procedure. It is important that Parliament should scrutinise such a key change and it is hoped that there will be no complaints about that. I beg to move.
  Lord Bach: My Lords, as the noble Lord has explained, the effect of his amendments would be to apply the affirmative resolution procedure to any commencement order containing transitional provisions of the type envisaged by Clause 159(5). The purpose is to enable a commencement order to specify lower limits for campaign and controlled expenditure in the event that Parts V and VI are brought into force less than 365 days in advance of the next election. Like the noble Lord, I leave it to others to speculate as to the timing of the next election and, consequently, whether lower limits will be needed.
  By convention, commencement orders are not subject to any parliamentary procedure. A commencement order simply gives effect to legislation that Parliament has already fully debated and

  931
  approved. Once a Bill has been enacted Ministers are expected to get on with its implementation. We believe that it would be a constitutional absurdity to provide for the possibility that the implementation of an Act of Parliament could be delayed or frustrated by the operation of the affirmative resolution procedure.
  Clause 15915) does not justify a different approach in this case. It contains an entirely understandable and, in our view, routine transitional provision. We shall naturally want to consult the political parties on the limits to be applied to any truncated campaign period; indeed, my right honourable friend the Home Secretary has already undertaken to do so. But the general approach is already set out in the Bill and we see no reason to submit the relevant commencement order to further parliamentary scrutiny. We would expect some back-end loading of the limits as the expectation must be that the majority of a party's expenditure will be incurred in the final few weeks of an election campaign. I should like to be able to persuade the noble Lord that there is nothing unusual about the commencement arrangements for this Bill, and I invite him to withdraw his amendment.
  Lord Goodhart: My Lords, I am grateful to the Minister for giving way. Speaking as a member of the Delegated Powers and Deregulation Committee, it is perfectly correct that in principle commencement orders are not subject to parliamentary scrutiny, but I have never seen a commencement order which contains authority to make transitional provisions. Orders that contain powers to make transitional provisions are usually subject to the negative, not affirmative, resolution procedure.
  Lord Mackay of Ardbrecknish: My Lords, I believe that the noble Lord, Lord Goodhart, makes the point clearer than I did. I fully accept that normally these order-making powers do not come before Parliament, and I do not try to change that situation. However, this is unusual in that at some stage in the next month or two a decision will be taken to change the terms of the provision and the £20 million limit. I am grateful for confirmation of the position of the Home Secretary and the added confirmation that back-end loading is understood. However, I believe that the noble Lord, Lord Goodhart, makes a valid point.
  Lord Bach: My Lords, the noble Lord, Lord Goodhart, expresses a view with his usual force. However, the committee of which he is a member has approved the order-making power in this case, which we believe is sufficient. If the committee had not given its approval we would have had to think again.
  Lord Mackay of Ardbrecknish: My Lords, I do not know whether the Delegated Powers and Deregulation Committee considered it in the light of the fact that it was likely to change the £20 million limit quite dramatically, but we cannot continue that debate at Report stage. I am grateful for the two points that the noble Lord has put on record. I still regard it as a pity. Perhaps the negative resolution procedure would have
  932
  been a better approach. I have made my point and the Minister has responded. I just hope that the parties can reach agreement; if not, we may find ourselves in an unhappy position. I beg leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  [Amendment No. 267 not moved.]
  Lord Bach Lord Bach moved Amendment No. 268:
  Page 116, line 5, at end insert—
  ("() section 17(1),").
  On Question, amendment agreed to.
  [Amendment No. 269 not moved.]
  Lord Bach Lord Bach moved Amendment No. 270:
  Page 116, line 28, at end insert—
  ("() Nothing in this Act shall be read as affecting the generality of subsection (5) (including that subsection as applied by section 18(6)).").
  On Question, amendment agreed to.
  10 p.m.
  Schedule 21 [Minor and consequential amendments]:
  Lord Bach Lord Bach moved Amendment No. 271:
  Page 223, line 16, at end insert—
  (" . In section 14(8) of that Act (changes that may be recommended), for "section 13(1) above" substitute "section 13(1A) above".").
  The noble Lord said: My Lords, in moving Amendment No. 271, I shall speak to Amendment No. 272. Amendment No. 271 is a minor drafting amendment to new Section 14(8) of the Local Government Act 1992 which was inserted by the Local Government Act 2000. In referring to Section 13(1) of the 1992 Act, new Section 14(8) omitted to take account of the changes made to Section 13 of the 1992 Act by the Bill.
  Amendment No. 272 has more substance. Noble Lords will recall that Part II of the Local Government Act 2000 makes provision for new forms of local government, including directly elected mayors. Sections 44 and 45 of the 2000 Act confer regulation-making powers on the Secretary of State so that detailed provision may be made for the conduct of elections and referendums in respect of directly elected mayors. We have already provided in Clauses 6 and 7 of the Bill for the electoral commission to be closely involved whenever delegated powers are exercised in respect of parliamentary and other elections. The requirement to consult the commission on such matters should extend to elections and referendums held under Part II of the Local Government Act 2000.
  Amendment No. 272 amends Sections 44 and 45 of that Act to this end. Noble Lords will note that the procedure for consulting the commission on the wording of a referendum question and on setting the spending limits in a referendum mirror the approach we have taken in respect of referendums conducted under Part VII of the Bill. I beg to move.
  On Question, amendment agreed to.
  Lord Bach Lord Bach moved Amendment No. 272:
  Page 225, line 26, at end insert—
  ("Local Government Act 2000 (c.22)
  .—(1) The Local Government Act 2000 is amended as follows.
  (2) In section 44 (conduct of elections of elected mayors or elected executive members), after subsection (3) insert—
  "(3A) Before making any regulations under this section, the Secretary of State shall consult the Electoral Commission.
  (3B) In addition, the power of the Secretary of State to make regulations under this section so far as relating to matters mentioned in subsection (2)(c) shall be exercisable only on, and in accordance with, a recommendation of the Electoral Commission, except where the Secretary of State considers that it is expedient to exercise that power in consequence of changes in the value of money.".
  (3) In section 45 (conduct of referendums under the Act), after subsection (8) insert—
  "(8A) Before making any regulations under this section, the Secretary of State shall consult the Electoral Commission, but this subsection does not apply to—

  (a) provisions which specify the wording of the question to be asked in a referendum, or

  (b) provisions for matters mentioned in subsection (8)(c).

  (8B) No regulations which specify the wording of the question to be asked in a referendum may be made under subsection (5) unless—

  (a) before laying a draft of the regulations before Parliament in accordance with section 105(6), the Secretary of State consulted the Electoral Commission as to the intelligibility of that question, and

  (b) when so laying the draft, the Secretary of State also laid before each House a report stating any views as to the intelligibility of that question which were expressed by the Electoral Commission in response to that consultation.

  (8C) Where any such regulations specify not only the question to be asked in a referendum but also any statement which is to precede that question on the ballot paper at the referendum, any reference in subsection (8B) to the intelligibility of that question is to be read as a reference to the intelligibility of that question and that statement taken together.
  (8D) No regulations which make provision for the matters mentioned in subsection (8)(c) may be made under subsection (5) unless—

  (a) before laying a draft of the regulations before Parliament in accordance with section 105(6), the Secretary of State sought. and had regard to, the views of the Electoral Commission as to the provision to be made by the regulations as to those matters, and

  (b) where the draft regulations laid before Parliament made provision as to those matters otherwise than in accordance with the views of the Electoral Commission, the Secretary of State, when so laying the draft, also laid before each House a statement of his reasons for departing from the views of the Commission.".

  (4) In section 45(9), after "(8)" insert "to (8C)".").
  On Question, amendment agreed to.
  Schedule 22 [Repeals]:
  Lord Bach Lord Bach moved Amendment No. 273:
  Page 226, line 41, column 3, at end insert—
  ("Section 4(2).")
  On Question, amendment agreed to.
  Clause 157 [General interpretation]:
  Lord Bach Lord Bach moved Amendments Nos. 274 and 275:
  Page 117, line 28, at end insert—
  (""exempt trust donation" has the meaning given by section (Interpretation: exempt trust donations);").
  Page 118, line 1, at end insert (", and "modify" shall be construed accordingly;").
  On Question, amendments agreed to.
  Clause 158 [Interpretation: donations]:
  Lord Bassam of Brighton Lord Bassam of Brighton moved Amendment No. 276:
  Page 119, line 20, at end insert—
  ("(6) For the purposes of this Act it is immaterial whether a donation received by a registered party or a person of any other description is so received in the United Kingdom or elsewhere.").
  The noble Lord said: My Lords, I can be brief. The amendment adds a new subsection (6) to the interpretation clause relating to donations. The new subsection provides that for the purposes of the Bill it is immaterial whether a donation received by a registered party or other regulated donee is received in the United Kingdom or elsewhere. As a result of this provision, a registered party could not escape the provisions of Part IV by arranging for a donation to be paid into a foreign bank account. I beg to move.
  On Question, amendment agreed to.
  Lord Bach Lord Bach moved Amendment No. 277:
  After Clause 158, insert the following new clause—

  INTERPRETATION: EXEMPT TRUST DONATIONS
  (" .—(1) For the purposes of this Act "exempt trust donation" means a donation to which subsection (2) or (3) applies, other than one falling within subsection (5).
  (2) This subsection applies to any donation received from a trustee of any property in accordance with the terms of a trust—

  (a) which was created before 27th July 1999,

  (b) to which no property has been transferred on or after that date, and

  (c) whose terms have not been varied on or after that date,

  provided that, at or before the time of the receipt of the donation, the trustee gives the recipient of the donation the full name of the person who created the trust and of every other person by whom, or under whose will, property was transferred to the trust before that date.
  (3) This subsection applies to any donation received from a trustee of any property in accordance with the terms of a trust—

  (a) which was created by—

  (i) a person who was a permissible donor falling within section 52(2) at the time when the trust was created, or

  (ii) the will of a person falling within section 52(3), and

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  (b) to which no property has been transferred otherwise than—

  (i) by a person who was a permissible donor falling within section 52(2) at the time of the transfer, or

  (ii) under the will of a person falling within section 52(3),

  provided that, at or before the time of the receipt of the donation, the trustee gives the recipient of the donation the relevant information.
  (4) For the purposes of subsection (3) "the relevant information" means the information which is required by virtue of paragraph 2 of Schedule 6 to be given in respect of a recordable donation to which that subsection applies.
  (5) A donation falls within this subsection if it is received from a trustee of any property pursuant to the exercise of any discretion vested by a trust in him or any other person.
  (6) In this section—

  (a) "donation" means a donation for the purposes of the provisions of this Act in which the relevant reference to an exempt trust donation occurs;

  (b) "property", in the context of the transfer of property to a trust, does not include any income of the trust;

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  (c) "trust" includes a trust created by a will; and

  (d) any reference to a donation received from a trustee is a reference to a donation received from a trustee in his capacity as such, other than a donation transmitted on behalf of a beneficiary under a trust.").

  On Question, amendment agreed to.
  Schedule 23 [Transitional provisions]:
  Lord Bach Lord Bach moved Amendments Nos. 278 to 280:
  Page 228, line 46, at end insert—
  ("(ii) (if the party is seeking to be so registered as a party with a campaigns officer) of a person to be registered as that officer; and").
  Page 228, line 49, at end insert ("and (if paragraph (a)(ii) applies) by the proposed campaigns officer").
  Page 229, line 2, after ("treasurer") insert ("and of an officer of the unit to be registered for the purposes of section 25(3)").
  On Question, amendments agreed to.
  House adjourned at three minutes past ten o'clock.