Lords Sitting of 3 July 2001

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

Lord Temple-Morris
Peter Temple-Morris, Esquire, having been created Baron Temple-Morris, of Llandaff in the County of South Glamorgan and of Leominster in the County of Herefordshire, for life—Was, in his robes, introduced between the Lord Williams of Mostyn and the Lord Richard.

Lord Grocott
Bruce Joseph Grocott, Esquire, having been created Baron Grocott, of Telford in the County of Shropshire, for life—Was, in his robes, introduced between the Lord Evans of Parkside and the Baroness Boothroyd.
Several Lords—Took the Oath.

Turkey: Human Rights
2.48 p.m.
The Lord Bishop of Rochesterasked Her Majesty's Government:
In the Turkey Accession Partnership formally agreed between Turkey and the European Union, what commitment is required of Turkey to improve its human rights record and, in particular, its treatment of religious and ethnic minorities.
The Minister for Trade (Baroness Symons of Vernham Dean): My Lords, the EU/Turkey Accession Partnership is an important step forward in Turkey's EU candidature. It makes clear the wide range of political and human rights reforms that Turkey will have to carry out in order to meet the Copenhagen political criteria, including reforms related to freedom of conscience and of expression. We fully support Turkey's EU candidature and look forward to early implementation of the reforms set out in the accession partnership and in Turkey's own national programme.
The Lord Bishop of Rochester: My Lords, can the Minister tell the House how the ancient Christian communities of Tur Abdin and of the Phanar, as well as the newer communities of Izmir and Istanbul, are faring? Is there any improvement in their condition?
Baroness Symons of Vernham Dean: My Lords, officials from our embassy are in touch with all the Christian communities which the right reverend Prelate has mentioned. They are not only in touch; they have visited them all. We have raised individual
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cases where we have felt that there has been harassment of those communities in the past. We welcome the Turkish Prime Minister's recent statement instructing public bodies to ensure that the Syrian Orthodox communities' rights are respected. We look forward to continued progress by the Turkish authorities in bringing about the necessary reforms to comply with the Copenhagen political criteria.
I am assured that our officials stand ready co take up particular cases which are brought to their attention. We have done so in the past with a measure of modest success.
Lord Avebury: My Lords, has the Minister noted that in the European Court of Human Rights there have been 160 findings against Turkey, plus 30 friendly settlements; and that a further 2,700 cases are pending consideration by the court? Is it the requirement of the European Union that Turkey will comply fully with the judgments of the European Court, including the return of 300,000 people who were displaced from their villages in the south-east? Has the noble Baroness also noted the pending case of the Kurdish MPs who were sentenced to 15 years' imprisonment for thought crime? Is it not essential that those MPs should be released if Turkey is to bear any resemblance to a genuine parliamentary democracy?
Baroness Symons of Vernham Dean: My Lords, yes, on the latter point, those who have been properly, democratically elected should expect to enjoy the freedoms that we would expect elsewhere in the European Union if a candidature is to go forward. Of course, we expect compliance with the courts.
It is worth pointing out that under the Copenhagen criteria we are talking about a wide spectrum of issues. The right reverend Prelate concentrated on freedom of religion and of expression. But there are issues about prison conditions and freedom of expression and association which we might associate rather more with political life in Turkey. We expect Turkey to make progress on these issues. We shall have a further opportunity of assessing the progress made when the European Commission is able to consider what has happened this year in Turkey's progress on these matters. It is due to do so in November.
Lord Ahmed: My Lords, is the Minister aware that the Turkish Government are currently in the process of considering a large number of constitutional and legal changes? Will the noble Baroness join me in congratulating the Turkish Government and in encouraging them to press ahead with those reforms?
Baroness Symons of Vernham Dean: My Lords, it is important that we look not only at the demands made on Turkey by the accession partnership, but also at Turkey's response, contained in its national programme for the adoption of the acquis, which I mentioned in my initial Answer to the right reverend Prelate. Turkey is making some of the reforms that the noble Lord referred to. The issue is whether those

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reforms are making a real difference on the ground. That difference will have to be assessed when the opportunity arises in November this year.
Lord Howell of Guildford: My Lords, the defence of Europe depends to some extent on Turkey, which is surrounded by most of the world's potential crisis points. Will the Minister assure us that Turkey will have a proper part to play in the new rapid reaction force and the new defence arrangements for Europe and will not feel excluded or humiliated?
Baroness Symons of Vernham Dean: My Lords, I strongly agree with what the noble Lord says about Turkey's contribution to the security of the region. I also join him in the emphasis that he puts on Turkey's value as a partner in NATO. Together with all the other NATO allies, Turkey signed up to supporting the ESDP at the alliance's 1999 Washington summit. To that end, we are working with Turkey to gain agreement to proceed with the detailed implementation of the Washington summit decisions. We believe that the ESDP will enable Turkey to work effectively with the EU on defence matters, but the noble Lord is right—and I do not disguise the fact—that there is a great deal still to discuss. Those discussions are progressing.
Lord Hylton: My Lords, the Minister mentioned prisons. Does she accept that there are 10,000 political prisoners in Turkey, many of whom were convicted before military tribunals? Will the Government do their best to ensure that there is detailed monitoring of the change from communal cells to individual cells because of the strong fears of victimisation as a result of the change of regime?
Baroness Symons of Vernham Dean: My Lords, we remain concerned about the conditions in Turkey's prisons. We are concerned, for example, about the recent arrest of 18 women and one man for making allegations about torture, and particularly about rape, during periods when they were in custody. That has worrying implications. We continue to monitor that case and other cases of alleged abuse in Turkish prisons. The noble Lord makes a point about military courts. It is important to note that the accession partnership urges Turkey to align the constitutional role of the national security council as an advisory body to the government in accordance with the practice of other EU member states. By pressing forward on that point, we are looking at the role of the military in Turkish courts.
Lord Elton: My Lords, who decides whether Turkey has met the Copenhagen requirements and by what means will this country be able to ensure that they are met?
Baroness Symons of Vernham Dean: My Lords, there is an annual assessment of how Turkey is complying with the detailed specifications put forward
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in the partnership agreement. That is done every year in November. It will be done again this November. It will be a matter for the Commission in the first place—I look to my officials on that point—which will then advise member states. It is important to remember that the Copenhagen political criteria are the starting point for all the candidates for EU membership. In that respect, Turkey is no different. Turkey is not being asked to cross any particular hurdle that current EU members or other states currently going through the acquis process have not had to cross. The annual assessment is the important point.

Agriculture
2.57 p.m.
Lord Renton of Mount Harryasked Her Majesty's Government:
By what means they intend to restore profitability to British agriculture.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty): My Lords, these are difficult times for British agriculture and the Government are working hard to help the industry tackle the challenges that it faces. We have already introduced measures worth £1.35 billion. However, in addition to the difficult process of recovery from foot and mouth disease, further changes will be necessary in farming and the food chain and on the framework of the CAP to achieve a sustainable long-term future. The Government will shortly announce a policy commission on the future of food and farming.
Lord Renton of Mount Harry: My Lords, I remind your Lordships that I have an interest in this matter as chairman of the Sussex Downs Conservation Board. I thank the Minister for that reasonably frank Answer. What hope can he give us that his new department, which brings together the interests of agriculture and the environment in a specific way, will be more successful than the previous two departments in producing initiatives that are friendly to agriculture and the environment? Does he accept that, with the current crisis in the farming industry, there is a real need to sell to farmers the importance of biodiversity and environmental improvement as part of agriculture moving forward? Finally, I remind the Minister that the acronym of his new department is DEFRA, which in Welsh means "wake up"—a good motto for the new department.
Lord Whitty: My Lords, I have taken linguistic advice from my noble and learned friend the Leader of the House, who tells me that that is not an entirely correct transposition from the Welsh. However, for those who wish to think that it is, I believe that DEFRA will provide a clarion call for a change in our approach to rural development and the role of agriculture within that. The department places agriculture and food production within the totality of

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the food chain and horizontally within the whole remit of rural development. In addition, it places it clearly in the areas to which the noble Lord, Lord Renton, referred.
There is a requirement for agriculture to observe more broadly the needs of the environment and, in particular, the interests of biodiversity and, therefore, the future prosperity and beauty of our countryside. I believe that the creation of our department makes for a new departure in that respect.
Lord Tomlinson: My Lords, does my noble friend agree that a serious negative cost to British agriculture arises from this country remaining outside the European single currency? Will he therefore suggest to our mutual right honourable friend Mr Gordon Brown that he bears that seriously in mind when he makes his evaluation of the five economic tests for membership?
Lord Whitty: My Lords, I am sure that my right honourable friend the Chancellor is aware of the implications for agriculture, as he is of those relating to the rest of the British economy. He would not expect me to pronounce any new policy in relation to the euro here today. However, the decline of the euro against sterling has coincided with a drop in farm incomes. There has been a 20 per cent decline in the value of the euro against the pound over the period 1995–99, which has seen a serious squeeze on farm incomes. That is undoubtedly part of the issue. Nevertheless, the industry must address longer-term structural and world price issues, quite apart from our relationship with the euro and the CAP.
Lord Carlile of Berriew: My Lords, does the Minister agree that one method by which to restore business viability to many small farms would be the prompt payment of compensation in respect of foot and mouth disease? Can he offer farmers any good news about the acceleration of that process, which is taking many months and causing widespread frustration, particularly to small farmers in the hill areas of this country?
Lord Whitty: My Lords, I believe that there is a problem, as the noble Lord indicates. However, to say that the compensation process is taking many months is an exaggeration. We have a target for the payment of compensation, both for foot and mouth disease and for the welfare disposal scheme, of 21 days. In general, we have not met that 21-day target, but the average payment has been made between 30 and 40 days. That period is reducing and the process is now speeding up substantially as the number of cases diminishes. I recognise that there has been a problem. We are doing our best administratively to tackle it.
Lord Peston: My Lords, will my noble friend remind your Lordships of the scale of agricultural subsidy in this country? Noble Lords opposite used to believe in the free market but no longer do so. Why remotely should the Government be responsible for restoring
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the profitability of any one sector of the economy? In a modern market economy it is required that the sector itself should put its house in order and that it should not expect further handouts from governments.
Lord Whitty: My Lords, as ever, my noble friend Lord Peston has impeccable logic. However, the position of agriculture in our society and in our economy has been recognised by successive governments as being in some ways a special case. Clearly the profitability and marketability of the produce of agriculture is an important dimension. However, the Government must also take account of the role that agriculture plays in the rural economy as a whole and, indeed, in the rural landscape. It encourages, for example, visitors to the countryside and makes its contribution via tourism to the prosperity of the countryside more generally. Therefore, agriculture is perhaps in the long run no different from other industries, but the context in which it operates requires special government attention.
Earl Peel: My Lords, on that basis the long-term good of agriculture can be sorted out only if the short term is addressed, and in view of the fact that livestock markets are now closed, can the Minister tell the House how farmers are going to dispose of accumulated stock come this autumn? That will certainly have a direct effect on the cash flow and business interests of the farms in question. An animal welfare problem will also arise because, as grass begins to run out, how on earth will farmers feed their stock if they cannot use the livestock markets?
Lord Whitty: My Lords, I believe that most people within the agriculture sector—I am sure that this applies to the noble Earl—recognise that the priority must be to defeat the disease. Inevitably, that means that there will continue to be some severe restrictions on movement and on livestock markets through to the autumn. I accept that that will cause significant problems, in particular for sheep farmers but also for others, which will need to be addressed by a coherent strategy. Defeating the disease is the first priority, and ensuring that there are no welfare problems is the second. But, in the long run, we must move to a market situation. Therefore, whatever action we take in relation to the dispersal and disposal of stock in the autumn must also be conducive to a long-term, more balanced market situation. We have not reached that stage yet.

Social Care for the Elderly and Disabled
3.5 p.m.
Lord Ashley of Stokeasked Her Majesty's Government:
What action they are taking on the 15 recommendations of the King's Fund inquiry into care and support services for old and disabled people.
Lord Filkin: My Lords, we welcome the publication of the King's Fund report, Future Imperfect, which contributes to the important debate about how to improve social services. We are already working with local councils and other agencies to raise standards across social care. In addition, the Department of Health is funding a national recruitment campaign for social care staff. We have commissioned a national training strategy and are providing funding of £2 million to help to implement it this year.
Lord Ashley of Stoke: My Lords, I thank my noble friend for that comprehensive reply. Is he aware that the increase from 3 to 3.5 per cent is welcome but that it is hopelessly inadequate because we now have new evidence about the reality? The report spells out very clearly the fact that the system of care and support for old and disabled people is in what it calls a "developing crisis". That means that many thousands, or perhaps millions, of vulnerable people are suffering, and many more will suffer unless the crisis is dealt with.
The report suggests an increase not of 3 or 3.5 per cent but of 30 per cent. It argues its case very cogently and in great documentary detail. Is it not the case that the Government have a choice: they can either rubbish the report and explain why they do so, or they can accept it and act accordingly.
Lord Filkin: My Lords, we do not want to rubbish the report because we consider that it contains many sound and important points, not least the affirmation of the importance of properly restructured and funded social care services for many people in Britain. Since 1997, in real terms government have increased funding in social care services by 15 per cent, not the 3 per cent referred to. Funding will increase again in real terms for each of the next two years by 3.5 per cent. When all that investment is in place, it will amount to some £1 billion extra per annum for care services.
Money alone is necessary but not sufficient. Therefore, in addition, the Department of Health has established a major programme of service modification to try to improve the way in which that funding is best used to deliver the outcomes that the public want.
Lord Rix: My Lords, does the Minister agree that person-centred services for people with learning disabilities will be possible only if they are actively supported by staff who have been well trained under the new learning disability active framework, along the lines emphasised in the King's Fund inquiry?
Lord Filkin: My Lords, I am happy to agree with the noble Lord's point about the crucial place that training plays in the improvement of social care services. More than 1 million individuals, together, of course, with the carers, provide unpaid support to those in need. Therefore, the department understands that the development of a comprehensive improvement in training and support for staff is critical. A better induction programme is being introduced; the development of care NVQs is taking place; £2 million
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is being put in place this year to implement a training strategy; and, as noble Lords will be aware, some £47 million is already made available each year through social services grant to support training. Over and above that, the progressive registration of all social care staff will take place to try to ensure that not only does the training take place but that it has the effect and impact that we hope for.
Baroness Northover: My Lords, does the Minister agree that this is a devastating report and that the King's Fund does not lightly speak of impending catastrophe? Does he also accept that this sector is dangerously under-funded? It cannot be right that two-thirds of paid carers have inadequate or no qualifications relating to their work. If the new care trusts, which we discussed before the general election, are to work, is it not vital that they are adequately funded with parity between the health sector and the social services side, so that the elderly and disabled do not lose out yet again?
Lord Filkin: My Lords, I thank the noble Baroness for that question. I re-emphasise that the report is not a devastating indictment of where we are; it is a statement of where we want to be and it stresses the importance of getting there. In many respects, the report's recommendations mirror what the Government are already putting into practice. It acknowledges that nobody knows for certain the exact level of financial resources that is needed in this sector. The level of funding that the Government have already contributed has to be put to good use and an eye has to be kept on the possibility that further gaps may open in future.
I absolutely agree with the noble Baroness's second point, which was about qualifications. The workforce has often been undervalued, under-trained and under-supported, although it provides some of the most important social care functions in society. It should receive the priority and attention that it needs. The situation has been neglected for too long. The Government stand four-square with the noble Baroness on that matter.
With regard to health and social services, the Government strongly concur that it is crucial that the two arms of government continue to focus their efforts so that the public do not suffer from the difficulties that are associated with making separate agencies work. I am certain that the Government will continue to emphasise that in the coming months and years.
Lord Morris of Manchester: My Lords, I warmly endorse the well-merited welcome for the appointment of my noble friend to the Front Bench. Can he say any more today on direct payments, especially for older and severely disabled people; or about expanding the training of the workforce for providing social care for them?
Lord Filkin: My Lords, I thank my noble friend for that question. I shall be brief. The Government strongly support the extension of direct payments. In many cases people themselves know what is best for

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them. The principle of trying to put more power in the hands of the public in relation to the support that they need seems to be right. That is why the provisions were extended also to cover Children's Act services; that is also why, from 2002, local authorities will be obliged to offer greater freedom to people who wish to take direct payments. The evidence so far is that direct payments are a success story. They are popular with the public and research evidence seems to demonstrate that they are highly effective.

Manufacturing Industry
3.13 p.m.
Lord Campbell of Croyasked Her Majesty's Government:
What action they think necessary to reverse the contraction in output of the manufacturing sector of industry.
The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville): My Lords, the recent weakening in manufacturing output reflects the world economic slowdown and follows a previous period of growth. The platform of economic stability that the Government have established, together with our policies to foster enterprise and to help firms to innovate and grow, are the best way to secure the long-term success of the UK's manufacturing sector.
Lord Campbell of Croy: My Lords, I thank the noble Lord for that Answer. Have the Government been worried by the falling index of the Chartered Institute of Purchasing and Supply—a reliable guide—which has been recording this contraction? Will they seek to alleviate the difficulties by, for example, reducing further the burden that is imposed on energy-intensive firms through the climate change levy?
Lord Sainsbury of Turville: My Lords, the current pattern of manufacturing is not confined to the UK. The US has experienced seven consecutive months of decline in manufacturing output and there are signs in France and Germany of stagnation. It will be very difficult for our manufacturing industry to be totally removed from that. We also need to be clear about what the exact position is. Although we are possibly dealing with a worsening situation, and although manufacturing output fell by 1.1 per cent in the three months to April, the figure was up by 0.6 per cent compared with the previous year. It is not totally an unfortunate situation. We are worried whenever there is a decline in manufacturing output and we are trying to create all the conditions to make it possible for companies to grow and innovate.
The climate change levy is a key element in our national climate change programme. I am sure that the noble Lord is aware that the industry's competitiveness is protected through the recycling of all revenues to business via reduced employer national
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insurance contributions and the 80 per cent discount for energy-intensive sectors that sign up to or deliver energy savings targets. Although there may be specific cases in which there are difficulties, overall the climate change levy is neutral so far as industry is concerned.
Lord Barnett: My Lords, given the huge international problems in manufacturing industry, does the Minister accept that it would be more sensible to concede that there is virtually nothing that the UK Government can do on their own to reverse the contraction in the UK's manufacturing sector?
Lord Sainsbury of Turville: My Lords, in relation to manufacturing world-wide, the figures for all developed countries have declined during the past 10 years from about 30 per cent of GDP to 20 per cent. There are good reasons for that, and I am sure that all noble Lords are well aware of them. However, questions are raised when output increases, as it has done in this country, and there is a decline in the employment of labour because productivity has been increasing. There are sections of industry that are continuing to expand and to do extremely well. In the period 1995–2000, the engineering and allied industries increased their output by some 15 per cent. As in many other parts of industry, the high-tech end is doing well but the low-tech part, which is in competition with low-wage countries, is in difficulty. We need to create an environment in which all companies can innovate and deal with competition.
Baroness Byford: My Lords, does the Minister acknowledge that the climate change levy is indeed causing difficulty for some of our industries, particularly the horticultural industry? In view of the earlier response by the noble Lord, Lord Whitty, about the profitability of our farmers, does the Minister also accept that if we insist on creating extra costs and burdens, the question is not whether farmers will be profitable but whether they will continue to exist?
Lord Sainsbury of Turville: My Lords, I made it clear earlier that all the money that is raised through the climate change levy is recycled to industry. Overall, therefore, the levy does not affect competitiveness.
Lord Razzall: My Lords, does the Minister agree that in reality the Government have three options in this context? The first option—I suspect that after this afternoon's Question Time we should call it "Lord Peston's option"—is to do nothing on the grounds that the decline in manufacturing industry is nothing to do with Her Majesty's Government. The second option is to take the view that one might do something to try to encourage growth in the US and European economies, and thereby take up the slack in the UK's manufacturing output. The third option is to manufacture the exchange rate down, particularly against the European currencies. If the Minister agrees that those are the three options, which one will the Government follow? If he thinks that there is another option, what is it, and what will he do about it?
Lord Sainsbury of Turville: My Lords, the Government are trying to create the right conditions for manufacturing industry to innovate and grow. They will do all that they can in terms of macroeconomic stability and the encouragement and application of science and technology. They will not return to the policies of boom and bust or pretend that they can determine the level of manufacturing in the economy. They cannot and will not do that in these circumstances. They will continue to do all that they can to create the conditions, in terms of macroeconomic stability, in which industry can grow and innovate. Of the noble Lord's three options, it is the second, rather than the third or the first, that is relevant.

Human Rights: Select Committee
3.20 p.m.
The Chairman of Committees (Lord Tordoff): My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That a Select Committee of six Lords be appointed to join with a committee appointed by the Commons as the Joint Committee on Human Rights:
To consider:
(a) matters relating to human rights in the United Kingdom (but excluding consideration of individual cases);
(b) proposals for remedial orders, draft remedial orders and remedial orders made under Section 10 of and laid under Schedule 2 to the Human Rights Act 1998; and
(c) in respect of draft remedial orders and remedial orders, whether the special attention of the House should be drawn to them on any of the grounds specified in Standing Order 73 (Joint Committee on Statutory Instruments);
To report to the House:
(a) in relation to any document containing proposals laid before the House under paragraph 3 of the said Schedule 2, its recommendation whether a draft order in the same terms as the proposals should be laid before the House; or
(b) in relation to any draft order laid under paragraph 2 of the said Schedule 2, its recommendation whether the draft order should be approved;
and to have power to report to the House on any matter arising from its consideration of the said proposals or draft orders; and
To report to the House in respect of any original order laid under paragraph 4 of the said Schedule 2, its recommendation whether:
(a) the order should be approved in the form in which it was originally laid before Parliament; or
(b) that the order should be replaced by a new order modifying the provisions of the original order; or
(c) that the order should not be approved.
and to have power to report to the House on any matter arising from its consideration of the said order or any replacement order;
That, as proposed by the Committee of Selection, the Lords following be named of the committee:

L. Campbell of Alloway,

L. Lester of Herne Hill,

L. Parekh,

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B. Perry of Southwark,

B. Prashar,

B. Whitaker;

That the committee have power to agree with any committee appointed by the Commons in the appointment of a chairman;
That the committee have power to adjourn from place to place within the United Kingdom, and to institutions of the Council of Europe outside the United Kingdom no more than four times in any calendar year;
That the committee have leave to report from time to time;
That the committee have power to appoint specialist advisers;
That the minutes of evidence taken before the committee from time to time shall, if the committee think fit, be printed and delivered out. —(The Chairman of Committees. )
On Question, Motion agreed to, and a message ordered to be sent to the Commons to acquaint them therewith.

Land Registration Bill [H.L.]
3.22 p.m.
The Lord Chancellor (Lord Irvine of Lairg): My Lords, I beg to move that this Bill be now read a second time.
The Law Commission, whose work—in a special joint project with the Land Registry—has led to this Bill, considers it the single largest project of law reform which it has ever undertaken. It is also one of the finest. For me it is a privilege to bring it before this House.
The Bill will have a direct impact on the lives of the millions of people who buy and sell property in England and Wales each year. It represents the culmination of the long process through which land registration has become the primary means of recording and guaranteeing title to land in England and Wales. It also marks a new departure, providing a framework for electronic conveyancing which, through comparatively minor alterations in the law, will change the way in which conveyancing services are provided and make a major contribution to the Government's determination to improve the house buying process.
The Bill will wholly replace the Land Registration Act 1925. It will lead to more land and more interests in land being protected by registration. Some valuable interests will for the first time be registrable voluntarily. The scope of compulsory registration will also be increased, in particular by bringing most leases, and therefore most commercial property transactions, within its reach. Commercial conveyancing must now use the cumbersome and complex unregistered law, and is excluded from the benefits and protections of registration, now and as they will be developed by the Bill. Extending registration will also enable the registry to improve the transparency of the property market by

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publishing accurate and neutral information on prices and market trends. Such information will undoubtedly be widely welcomed.
For the first time, all land belonging to the Crown will become registrable, including land underlying territorial waters. What the register tells us about the land will be extended and improved, most notably by reducing the number and scope of interests which can impose burdens without appearing on the register. The benefits of the registered system will be extended. The procedures protecting the rights of third parties over land will be simplified and strengthened. The protection which registration offers to registered owners against squatters will be improved.
Those reforms and improvements alone would represent a formidable achievement. But in a few clauses, the Bill will also hugely increase the attractions of registration. It will open the way for radical changes in the way in which the formal documents required in conveyancing are prepared, in the quality and speed of the services which conveyancers are able to provide, and in the relationship between conveyancers and the Land Registry. That process will complete an IT evolution in which the Land Registry has been engaged for over a decade.
All registered titles and all the millions of supporting documents will be in computerised form by the end of 2003. Since 1992, the registry's customers have become increasingly used to on-line services. The registry now deals with approximately 400,000 transactions every month in this way. The latest significant development will come in the autumn, when the new National Land Information Service will provide a single electronic point of access to almost all the information, from a wide variety of sources, which conveyancers need.
The Bill will crown those developments by making it possible to execute and deliver the formal documents effecting dispositions of land or interests in land by electronic means. For buyers, that means transactions which are quicker, cheaper, and so less stressful.
Those two themes, of improving the register and developing electronic conveyancing, produce a single fundamental objective for the Bill; that is, that the register should be as complete and accurate a reflection of the state of the title of the land at any given time as is reasonably practical, so that it is possible to investigate title to land on-line, with the absolute minimum of additional inquiries and inspections.
Part 1 continues the register of titles. The main measures to improve the inclusiveness and comprehensiveness of the register are in Parts 2 and 3, dealing with the first entry of land, or an interest in land, on to the register, and with subsequent transactions, respectively. Together they tackle the problem that the Land Registry is currently not complete, either geographically or in terms of the interests it records.
Part 2 describes when unregistered land can or must be registered, and offers better protection for people with legitimate interests in knowing when land will be
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added to the register. The most important change to the provisions governing compulsory first registration is that the length of leases subject to compulsory registration will be reduced, from leases granted for over 21 years to those granted for over seven years. The Lord Chancellor also is given powers to change the triggers for compulsory registration. The most likely use of that power is to reduce further the length of leases required to be registered.
Overriding interests are a problematic aspect of the current law. They bind any person who acquires an interest in registered land, whether on first registration or on a subsequent registrable disposition, but do riot need to be—and in some cases cannot be—registered. They cover a significant range of interests, including many easements, leases granted for 21 years or less, and an array of other interests such as manorial rights, which may be both obscure and onerous. They are a serious obstacle to the objective of making the register as complete a record of the title as can be.
The Bill reshapes the law, seeking to restrict such interests as far as possible, in relation to first registration, and to subsequent dealings with the land. Interests should override only when it is unreasonable to expect them to be protected in the register. Such interests are defined more narrowly in the Bill. Others are excluded. Some of the more obscure interests will cease to be automatically protected if not registered within 10 years.
Part 3 deals with land which is already on the register. It lists the transactions with registered land which transfer or create a legal estate and which should be completed by registration. As with first registration, a new requirement to register leases granted for more than seven years is introduced, with a power to reduce that period still further. Parts 4, 5 and 6 improve and strengthen the procedures of registration.
Part 7 makes provision for some important special cases for registration. The most novel relate to Crown lands, enabling the Crown to register all of its land, so that all of it has the benefits of appearing in the register.
Part 8 of the Bill is one of the shortest parts, but is undoubtedly the one which will effect the greatest changes. The Bill does not, and should not, aim to set out in detail how full electronic conveyancing should work. Instead, it provides a framework for a system which will meet the needs of customers, conveyancers and the registry; but which will be capable of being adapted and modernised quickly as electronic conveyancing and electronic commerce generally develop.
The Land Registry has now begun an intensive campaign of consultation with conveyancers, and with all the other people involved in buying and selling property. That is necessary because conveyancers themselves must work with the systems. They must therefore not only meet the registry's requirements, but those of a modern conveyancing practice. Conveyancers will be authorised to make direct changes in the register itself. The use of special computer systems to prepare documents will itself be

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quicker and cheaper than paper systems. It will also permit automatic checks with the Land Registry so that possible errors can be identified at an early stage, not, as all too often now, only at the end.
Documents will also be approved and take effect simultaneously. The new arrangements will wholly eliminate the delay which now inevitably occurs between the conveyancer sending paper documents to the registry and their entry in the register, and the problems that delay creates.
Electronic conveyancing will also foster the development of a system of electronic fund transfer that will help those involved to tackle the problems of delay and uncertainty in that part of the process. Legislative provision for that system is not necessary.
The introduction of electronic conveyancing will be progressive, starting with the simpler conveyancing transactions, and adding more complex ones as conveyancers become used to the network. The Bill provides, however, a power for its use eventually to be made compulsory for some or all transactions, because some of the advantages of electronic conveyancing will only be maximised when conveyancing is exclusively electronic.
The example which is perhaps of most immediate interest to home buyers and sellers will be that an electronic network for land registration would make chains of transactions transparent, identifying which participants are falling behind the rest so that they can be encouraged to catch up. Chain delays produce much of the slowness and stressfulness now inherent in house buying. Anything which reduces that must obviously be welcome. Equally obviously, if only one transaction in a chain is being managed on paper rather than electronically, the transparency is muddied and the advantages of the new capacity diminished.
There are therefore real practical advantages in making electronic conveyancing universal. That cannot be a realistic option until it has become the usual method of registered conveyancing. The Bill requires the Lord Chancellor to consult before making electronic conveyancing compulsory, and I would wish to do so on a very wide basis. The Land Registry must ensure that those who wish to undertake their own conveyancing without employing a solicitor or licensed conveyancer are able to undertake transactions in electronic form.
Part 9 extends the protection against adverse possession given to owners by registration. The principle should be that where title is registered the basis of title should primarily be the fact of registration. Currently title rests ultimately on possession. Put at its shortest, anyone who takes possession of land acquires a possessory title. If that individual holds on to it for the length of the relevant limitation period, currently 12 years, he cannot be shifted. That may be appropriate within the inherently relative titles of unregistered conveyancing but seriously undermines the certainty which registration aims to provide.
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The current law has undoubtedly given rise to a number of abuses and straightforward land theft. It does, however, enable some of the problems that occur with land to be managed. The public interest benefits if land held by an owner who takes no interest in it can be returned to economic use. Even within the registered system there is scope for reasonable doubt as to where boundaries lie. For example, it is by no means uncommon for the fences and other partitions in a newly developed estate to be put up in places which differ from those shown on the register. Due account has to be taken of those who have perfectly reasonably occupied and spent money on land which they thought was theirs. Part 9 sets out a package which balances the competing interests involved.
Parts 10 and 11 complete the provisions relating to the administration of the Land Registry. The most significant change from the current arrangements is the establishment of a new and independent judicial officer to determine registration disputes between individuals ensuring that the arrangements are wholly compliant with the European Convention on Human Rights. Part 12 of the Bill contains a number of miscellaneous and general provisions to ensure the effective operation of the Bill.
I began by referring to the scale of the project which the Law Commission and the Land Registry had undertaken. Their proposals were considerably refined and improved in the light of the responses to the major consultation paper published in 1998 and in the discussions and seminars which followed. They represent an achievement of the highest order. It is only right to place on record my gratitude for that achievement to the Law Commissioner responsible for it, Mr Charles Harpum, whose period at the commission has recently concluded, and the distinguished parliamentary counsel seconded to the commission with whom Mr Harpum has worked throughout.
Along with the Commonhold and Leasehold Reform Bill, the Bill forms part of a comprehensive programme for the delivery of a thoroughgoing modernisation in registration law and in conveyancing services. It is the best kind of law reform: clarifying principles, reforming practices and making the law simpler and more accessible. But above all this is a practical Bill. It will make home buying and selling quicker, simpler and cheaper and will make a real difference to people's lives.
I have praised the quality of the Bill and the work of the Law Commission and Land Registry that lies behind it. In doing so, I do not imply that the Bill is beyond improvement. We on the Government side will welcome and consider with an open mind any recommendations by way of amendment or otherwise that are made for the improvement of this high quality Bill.
Moved, That the Bill be now read a second time. —(The Lord Chancellor.)
3.37 p.m.
The Earl of Caithness: My Lords, we have come to expect nothing less than a clear exposition of a Bill by the noble and learned Lord the Lord Chancellor. Today is no exception. We must all be grateful for the clear way in which he took us through this useful measure. I give the Bill a warm welcome.
First, I must declare my interest as a surveyor. I declare the interests of all my various friends who are surveyors or property developers and those who have an interest in land as farmers or estate owners. I hereby declare any other interests that could be remotely connected to my interest in land and property. I hope I have covered that point.
I totally agree with the noble and learned Lord the Lord Chancellor that the Bill will be a major benefit to all those involved either professionally, as I am, in the buying and selling of commercial and residential property, or those who are the clients buying and selling their properties through agents. The Bill will undoubtedly speed up that process and is a constructive way to improve it. The Bill is much more constructive than the seriously flawed Homes Bill, which I am glad to say did not reach the statute book in the last Session. That Bill had some good points. However, had it been enacted, the situation would have been made considerably worse.
The noble and learned Lord the Lord Chancellor said that the Bill really covered two points: that is; the modernisation of the system of land registration—about 80 per cent of the land in England and Wales is already registered—and the introduction of electronic conveyancing. Before continuing, I, too, add my thanks to the Land Registry. I have benefited from its good offices for the past 30 years, ever since I have been in property. One has come to expect a high standard from it and I do not think that I have ever been let down. The Land Registry has been extremely helpful and the solicitors whom one has used have undoubtedly benefited too.
The noble and learned Lord the Lord Chancellor skipped over Clause 4, which is perhaps one of the most controversial clauses in the Bill, and refers to leases. A lease will now be compulsorily registrable if it is over seven years rather than if it is over 21 years. That is a fundamental change. There will be more bureaucracy and much extra work for those who benefit from such leases. Much extra cost will be involved. There will be more registration and that will open the scope for more areas.
That must be balanced against what the noble and learned Lord described as the need for greater transparency. I agree with that. The move is in the right direction but is by no means universally welcomed outside. The noble and learned Lord also referred to a trigger mechanism whereby the seven-year period could be reduced. If it is reduced to, say, three years, a number of agricultural tenancies could be brought within the ambit of the Bill. That will produce a great deal of extra work and complication for people in the agricultural sector. Much of the agricultural conveyancing and the leases are based on Ordnance Survey maps.
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I welcome the appointment of the adjudicator. It is a novel and sensible idea. However, will the adjudicator decide the boundary disputes? If there is a boundary dispute in the Land Registry—if the two sides are firmly opposed and whatever mechanism is in place fails to resolve the matter—will the adjudicator determine it?
The next important point relates to Part 8, which deals with electronic conveyancing. I reiterate my welcome for it but would like to know the timescale for its introduction. I was pleased to hear what the noble and learned Lord had to say, but the two schemes run in parallel. We are all used to the existing paper scheme and are increasingly becoming used to the electronic means. However, in order that there is complete fairness and no social exclusion for those who do not benefit from the e-commerce world, I hope that there will be a considerable period of overlap so that the two schemes can run in tandem.
Will the Government consider running a pilot project? There was a pilot project of the seller's pack, provided for in the Homes Bill, in Bristol. I criticised it because I did not believe that it was a good pilot project. The Government have carried out far better ones and I wonder whether, in case there are unforeseen glitches, a pilot scheme might he a good way forward. However, I agree that the legislation is the right way forward and that at the end of the day we should be using e-conveyancing and nothing else.
Also in relation to electronic conveyancing, there is no reference in the Bill to online auctioneering. That is an important issue for surveyors and I wonder how the Government propose to deal with it. We shall all be concerned to ensure that the appropriate security and authenticity measures are in place as regards electronic conveyancing and that false documents do not appear in the register.
My final point of concern relates to the Ordnance Survey maps which have always played an important part in transactions. We have always been able to rely on the maps which are attached to leases and conveyances. Will that be the case in the future? How will we work with the Ordnance Survey maps and the e-conveyancing?
The noble and learned Lord spoke of trying to speed up the process of house buying and referred to the question of chains. I agree that greater transparency of leases and conveyances by electronic means will achieve that. However, much of the slowness is due to the fact that people who are in chains are not honest about it. People have come to me and said, "I have sold my house", but they have not done so. They believe that they have and that they are cash purchasers, but they have sold it subject to contract or it is merely under offer. They are in a chain and perhaps have been told by the people buying their property that they too are cash buyers. A little more honesty would speed up the process.
I give the Bill a warm welcome. I want to explore certain matters in Committee, but I believe that it is a good step in the right direction.
3.45 p.m.
Baroness Cohen of Pimlico: My Lords, I, too, am grateful for the noble and learned Lord's clear exposition of the Bill. In supporting it, I need to declare not exactly an interest in the terms your Lordships' House was debating yesterday but perhaps a particular axe which I am grinding. I was once a practising solicitor and now I am a mother trying to support two children in their 20s through the purchase of flats and houses of their own. I welcome the Bill, but then I would welcome anything which made the horrors of buying property easier. I know that the sellers' lot will also be eased but I am naturally somewhat obsessed by the problems of the buyers.
The introduction of registration was a giant blessing. I can remember as a young solicitor dealing with titles which were not registered. Indeed, in reading the Explanatory Notes to the Bill, I was surprised to discover that registration finally became compulsory over the whole of England and Wales only in 1990. The final extension to Crown property and to the various interests which can be registered are most welcome.
To be able to work electronically to examine titles and to record interests in land will be a huge blessing for solicitors and conveyancers and therefore a great help to the general house-buying public. Indeed, it will be possible to make the fullest use of the system only when it is compulsory to deal electronically. I well remember how long it took us and how totally incompetent we were in the 1960s when we met an unregistered title. We had all forgotten how to deal with it and it took for ever. I imagine that tomorrow's solicitors will be brought up with electronic conveyancing and will be equally disabled if they come across a title which requires them to revert to bits of paper.
Welcome though the Bill is, it seems to address a bit of the system which does not work too badly already and does not address the bits of the system which work atrociously. The Land Registry is the least of the troubles which beset those selling or buying property. What we need and what I hope we will get is a reform of the whole ghastly process. The Bill we need and seem to have lost is that which introduces a compulsory seller's package. It seems to me that at present people can decide to place their property, complete with leaking roof, dodgy tenancy, two bathrooms and a conservatory installed without benefit of planning permission, on the market. They then meet with outrage or distress according to temperament—and weeks of delay no matter what their temperament—to gentle demands for proof of compliance with London building Acts, letters from tenants confirming that they are indeed leaving or proof that the person whose name is on the title but who is not signing the contract really died many years ago.
Some of those problems will be improved by the extension of registration, but were a seller's package compulsory, all those questions would have to have
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been addressed and surveyors put on warning, leaving only the remaining horrors of getting out of the chain and getting the mortgage offer.
I do not want to sound too virtuous. Three years ago we sold a house after living there for 20 years and from time to time converting bits of it. We, too, were pretty slow and incompetent about the whole process of getting the papers in order. If we had known that that would be required of us, we would, to the greater ease of doing business and the reduction of tension, have done so before putting the property on the market.
Let me not be ungrateful for the considerable mercies made possible by this Bill, which I welcome, but oh for the further blessings that would flow from a Bill making a seller's package mandatory.
3.49 p.m.
Lord Harrison: My Lords, like my noble friend Lady Cohen of Pimlico I am a very strong supporter of the principle of a seller's package. Perhaps noble Lords can be provided with some illumination as to what has happened to it.
Like the noble Earl, Lord Caithness, I warmly welcome the Land Registration Bill. Although I have no professional knowledge of the issues involved, like the vast majority of the population I am affected by land registration as both a house owner and former user of commercial offices in the fair city of Chester. In passing, my noble and learned friend the Lord Chancellor may be interested to know that the new law courts in the heart of that city have been built, and are blooming, on the site of a former amphitheatre. A photograph of those courts is quietly tucked away on page 9 of this week's Chester Chronicle. I wholly absolve my noble and learned friend of any blame for the local and national controversy, but I speculate as to what Roman law might have said about the registration of land devoted to a Roman amphitheatre on which law courts are built. Whatever the case, I can assure my noble and learned friend a warm and friendly reception if and when he comes to Chester to view his commission.
It is said that buying one's own house is the second most important decision that one makes in life. I can well believe it. The news today that house prices rose by 1.9 per cent in the past month, so that the average cost of a house now stands at £90,000, demonstrates the continuing financial importance of such a decision to people and their families in modern Britain. A proper, transparent and easy-to-use system of land registration is vital to maintain a healthy housing market. Similarly, the commercial life of our country is underpinned by an efficient system of land registration which promotes, or at least does not inhibit, commercial decisions involving property and helps to develop British business.
At the heart of the Bill is the promotion of electronic conveyancing which it is hoped will cover the whole process of property transactions. For too long conveyancing has been cobwebbed in a Dickensian world of scratching pens on yellowing parchment. It is time to modernise. Again in passing, I note today's

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jeremiad from the Engineering Council which regrets the slow-down in the world of electronic technology enterprise. Perhaps another ancillary benefit of this Bill will be to rejuvenate that particular hesitating industry.
This Bill cuts red tape and ensures that the transacting of property among the 14 million freehold and 3 million leasehold owners in England and Wales is simplified, rendered transparent and made more comprehensive by providing a more complete record of land than hitherto. As my noble and learned friend has pointed out, electronic conveyancing will, for example, enable the registration of an interest, right or disposition to be implemented simultaneously, thereby closing the so-called "registration gap". This front-loading of the role of the Land Registry should ensure that the conveyancing process is made more accurate and efficient. Undoubtedly, it will enormously reduce the current punishing 50 per cent of applications to the Land Registry which must be remitted because of error-ridden submission.
With the flux of time the Land Registration Act 1925 has become outdated and, not surprisingly, unfit for our modern, electronic age. I congratulate the Government on following up and modifying the proposals set out in the Law Commission's and Land Registry's consultative document Land Registration for the 21st Century published in 1998. With this Bill the Government are following their election pledge to deliver top quality modern services.
I pass to a number of specific points on the Bill. First, as to short leases the Bill requires leases of fewer than 21, but more than seven, years to be compulsorily registered. The Government hold out the prospect of extending in due course the law to leases of fixed terms of three years or more. I listened very carefully to the observations on this matter by the noble Earl, Lord Caithness. Perhaps we can have an explanation as to why we should not proceed further at this stage. Why is there no compulsory registration of leases of three years under the present Bill?
Secondly, the Bill proposes to rationalise but not abolish the number of applicable overriding interests. It is further suggested that the Bill would encourage registration of known overriding interests, but why should there not be an obligation to register such interests? Surely, that is in the best interests of transparency and the avoidance of unwelcome discoveries during the process of any transaction.
Thirdly, it is suggested that the improvement in the conditions and system of registration will encourage the creation of a situation in which all land is publicly registered, thereby doing away with the current bifurcation of registered/unregistered land. Since this is a long-standing public policy objective of the Government, why not do it now, or at least set a limit of, say, 10 years for the registration of all land?
Fourthly, the notes to the Bill foresee the introduction of electronic registration as being incremental, with the entire process being completed by 2010. Why is there a delay? Nine years seems an age away. Cannot it be telescoped?
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Fifthly, as to adverse possession I have heard the criticism that the Bill favours big landowners and discriminates against squatters, especially those who purportedly perform the worthy job of utilising assets which are otherwise often neglected by absent landlords. We face the problem of the land's natural assets being squandered or neglected, but surely the solution is not squatters. Do the Government have other ideas about tackling this problem, which I accept may be beyond the ambit of the Bill?
Finally, the Bill applies to England and Wales, but it would be interesting to know to what degree it is compatible with the practice in Scotland and Northern Ireland. I also refer to the European Union. Noble Lords will recall that at the Lisbon summit the Prime Minister was involved in the move to encourage electronic communication technology as part and parcel of forming a modern, single European market. I hope that the process of moving to electronic commerce will help in that respect. However. I looked at the document drawn up jointly by HM Land Registry and the Law Commission in 1998. The only reference to Europe that I could find in that document was the European Convention on Human Rights. We are talking about a modern world in which there is free movement of citizens and workers. We want to encourage the creation of a single market and make sure that it works. I believe that each requires an efficient and transparent system of land registration throughout the European Union. The European Union has no jurisdiction in this matter, but I would have thought that a nod in the direction of ensuring that there is some compatibility between the practices in the United Kingdom and those in the European Union would be helpful in the desirable process of making the single market work and facilitating the free movement of citizens and workers.
In conclusion, this is a very welcome Bill. It is already apparent that this measure will receive a fair wind from all parts of the House. The sooner it is on the statute book the better.
4 p.m.
Lord Dixon-Smith: My Lords, I, too, am happy to join in the general welcome for the Bill. I agree generally with everything that has been said so far. I am particularly grateful to the noble and learned Lord the Lord Chancellor for his clear exposition of the totality of the package. I am also grateful to the noble and learned Lord for an additional reason, since I must assume that he had the responsibility for briefing the counsel who drafted the Bill. Early in my reading I was pleased to find in paragraph 20 of the Explanatory Notes the expression:
"The Bill also restates the law in modern and simple language".
Complex though the Bill is in many ways, it is expressed in terms that are much easier to understand than many previous Bills I have dealt with in this House. I am particularly grateful for that fact.

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That said, unfortunately, in Schedule 10, I came across a paragraph that deals with something called "Residual power". There I found another very clear statement which said:
"Rules may make any other provision which it is expedient to make for the purposes of carrying this Act into effect".
The noble and learned Lord the Lord Chancellor has gone a great way to put my mind at rest and in explaining the need for rules and regulations to make the system work after the Bill is enacted. However, when I read that paragraph there was a little red warning light in my mind because it made me wonder whether the Bill is telling the whole story and what it is that we do not know.
My conclusion is that the Bill is written in clear language, but because, in a sense, the seventh veil is still on, I am a little unsure about whether I can give it complete and total approbation.
My concern was also raised at the start of the Explanatory Notes. The notes discuss the origins of the Bill and the work done by the Law Commission and HM Land Registry joint study. Again the noble and learned Lord the Lord Chancellor fully set out that matter. There is no question that the Bill—the result of that work—is very worthwhile. The Explanatory Notes go on to state:
"Revised recommendations, amended in the light of the consultation response are to be published … on 10 July".
Today is 3rd July. If we have the possibility of revised recommendations from the body that led to the Bill, why is the Bill before us before we have had the benefit of knowing its suggested revisions? I put the matter no higher than that. I accept that those recommendations will be made available before the House goes into Committee on the Bill, but it would have been nice, perhaps, to have known at this stage what was likely to come. I cannot help but wonder if we are legislating in haste. Perhaps the Minister in her reply can indicate whether—because they, so to speak, have the inside track on this matter, and rightly so—the Government have been able to take the possibility of those revised recommendations into account in their original drafting.
Unlike the Homes Bill, which has been mentioned indirectly and on which the relevant professions that deal with property transactions were extremely divided, it is pleasing to report from my contacts with those professions that there is a general welcome for the Bill. That is quite unusual.
However, there are points of concern. In particular, concern has been raised about the access to and security of electronic information. I illustrate that concern by a tale from my past. Many years ago I was nominally responsible for the mainframe computer in County Hall. The manufacturer who had supplied it came to us one day and said that he wanted to bring some Italians to see the installation because they were thinking of buying this wonderful piece of equipment. Five swarthy men with sharply cut suits, which appeared to be somewhat loose below the shoulder, arrived. The manufacturer was present. There was a
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long and detailed discussion of the potential of the machine. I played no part in what was going on, since, as I say, I was only nominal head. However, towards the end of the discussion the leader of the party turned to me, looked me straight in the eye and said: "Well, Mr Dixon-Smith, we have heard everything from the manufacturer. We understand the potential of the machine. We have also heard everything from your treasurer's staff. They have explained how the machine works. We are very grateful for that. But is it a source of power?" That was the significant question that they wanted answered. I failed the manufacturer because I had to explain that we did not use it in that way.
We need to recognise that if knowledge and information are power, there is potential for abuse. I am quite sure that the noble Baroness in winding-up will assure me that sufficient safeguards will be in place so that the kind of abuse implied by that question cannot take place. But it is a very important matter.
The Bill provides for regulations. The noble and learned Lord the Lord Chancellor has explained exactly why that is so. The noble and learned Lord also dealt with the question of rules which will be required to make the system work, and work well. I am not sure about the status of the rules and whether they will be introduced in the form of regulations on which we have a modicum of influence or whether, as the Bill says, the rules will be "laid before Parliament". Therefore, rather like someone going around a museum we can look at them but we cannot touch them. It is important. So much of the detail of modern legislation is dealt with by secondary legislation. I am not sure what the status is of the rules within the context of secondary legislation. Again I ask the noble Baroness in winding-up to put my mind at rest and clarify that particular situation.
There is one final aspect of the matter that is worth touching on. As the noble and learned Lord the Lord Chancellor said in his introduction, part of the purpose of this legislation is to give clear and accurate information as to prices. That is one thing; and that is fine. However, I am concerned about the use to which that information might be put. If one thinks of the property business as a market, it is not a market in the conventional sense in which stocks and shares are constantly traded backwards and forwards in a market. Nor is it a market in the sense of commodities which are constantly traded backwards and forwards over very short timescales. The housing market is very slow. Knowledge of what a potential vendor might have paid for his property three, five or 10 years ago might influence the price that one is prepared to offer. Equally, if one is a vendor and happens to know that one's potential purchaser has just sold his property and for how much money, that might influence one's decision as to price.
We need to be aware of those matters. Perhaps it would be appropriate if prices were on a separate register from the registration of the land so that they were not automatically collated. Perhaps it would also be appropriate if price information could drop off the

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register after a certain period of time, as history, inflation and all kinds of other factors made it increasingly less relevant.
I am happy to add my welcome to the Bill. I am sorry if I have introduced what appears to be the only slightly carping tone to the debate but I think that the matters I have raised are important. This is a welcome Bill but I am just a little concerned that we are, to use a racing phrase, rushing our fences just a little.
4.11 p.m.
Baroness Crawley: My Lords, I, too, welcome the Bill before us this afternoon because, as my noble and learned friend the Lord Chancellor said, it provides a truly modern basis for land registration in the 21st century in England and Wales and will implement the single largest item of law reform ever undertaken by the Law Commission.
The Bill will make it possible to conduct investigations into the ownership of land and the registered rights affecting that land almost entirely online. That makes it revolutionary. As Sara McConnell said in her excellent piece in the Sunday Telegraph of 25th March:
"Click for Slick Conveyancing".
In addition, the new system will be based on registration of title, not possession.
This is a good news story for millions of British people who are frustrated, stressed out and fed up to the back teeth with the delays and obfuscation of much of the present system. If we look at the Bill's potential for improving conveyancing and enabling electronic conveyancing to he fully realised, we see that such a step would affect almost 70 per cent of the population of England and Wales who live in owner-occupied accommodation and would improve the progress of the 1 million-plus residential sales that are registered at Her Majesty's Land Registry each year. Electronic conveyancing could dramatically accelerate the present long-winded house buying process. It could cut costs and reduce the number of deals that fail before exchange of contracts. At the moment, one in four fails to complete.
As my honourable friend Mr David Lock, the Parliamentary Secretary in the Lord Chancellor's Department, said in another place before the election:
"The real benefit of e-conveyancing will be to reduce delays, saving money and also heartache when people cannot move house".
The benefits, he said, would be both financial and emotional. Given that house moving comes third in the great stress and trauma charts, after bereavement and divorce, the Bill's passage cannot be soon enough in coming.
As I see it, the Bill should not only improve conveyancing but should improve the law, making it clearer and simpler, enabling people to understand their rights and their responsibilities, with less recourse to expensive legal advice. It is designed to incorporate the best of the present system while removing the flaws, uncertainties and anomalies that have developed in the past 76 years. The last Land
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Registration Act was way back in 1925. That was when the Charleston was all the rage and civil aviation was still in its infancy. After all these years, the legislation is cumbersome and needs substantive reform in a number of areas to provide clear, modern law on land registration.
It is also hoped that the Bill will improve the quality of registered title, making title to registered land better than title to unregistered land—we heard of the problems with unregistered title faced by the noble Baroness, Lady Cohen, as a young solicitor—thus encouraging registration and bringing much information about land ownership into the public domain.
For those fearful that more information being brought on to the register and into the public domain would reduce commercial confidentiality and perhaps lead to abuse, as mentioned by the noble Lord, Lord Dixon-Smith, I would assume that the data protection legislation and the freedom of information principles will apply. Perhaps that could be confirmed when my noble friend Lady Scotland comes to sum up.
In conclusion, the promotion of housing choice, faster and cheaper conveyancing and making it easier for people to buy and sell homes is a strong ambition of my party in government. I look forward to seeing the Bill go a long way towards realising that ambition.
4.16 p.m.
Lord Goodhart: My Lords, this has been a short debate. All the Back-Bench speakers have been commendably brief and to the point. I hope that I shall be at least reasonably brief and reasonably to the point as well. I am particularly pleased that it has been a short debate because it will enable me to attend a dinner in Lincoln's Inn tonight to celebrate the 90th birthday of the noble and learned Lord, Lord Brightman, who was present in the Chamber at an earlier stage of the debate.
As I am going to be almost entirely positive about the Bill itself, perhaps I may start with one negative comment. The point has already been raised by the noble Lord, Lord Dixon-Smith. The Law Commission report on which the Bill is based is not being published until 10th July—a week today. That has caused a considerable problem with the preparation of speeches for Second Reading. Worse than that, the Committee stage starts on 17th July, which means that amendments are supposed to be put down by Friday 13th July. That will be extremely difficult, particularly in the case of a highly technical Bill such as this, where we are heavily reliant on briefing by experts. It is true that we now have the Bill itself and the Explanatory Notes, but the report will be extremely important in explaining the reasoning behind the Law Commission's proposals. I have no intention of boycotting the Committee stage but it may well be that a substantial number of amendments will be put down for Report which will not have been tested by debates at the Committee stage.
Land registration has proved to be extremely beneficial. I started practice—some time, I suspect, before the noble Baroness, Lady Cohen—when

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the number of areas where registration was compulsory was limited. Unregistered conveyancing was complicated, slow and lacked certainty. It increased the cost and time of conveyancing greatly. Deeds could disappear. When land was split up the original title deeds could be in the possession of only one of the successors, but they had to be made available to all the other successors on subsequent sales. There was a long and tiresome document called an abstract of title, which fortunately one does not now see. I remember one case in which I was acting for a City livery company that wanted to sell part of its land. There was a serious problem with the sale because the company's title deeds had been destroyed in the Great Fire of London.
Compulsory registration of land was started in London with the Land Transfer Act 1897. Compulsory registration was extended to the rest of the country on a rolling basis by the Land Registration Act 1925, though the rolling was extremely slow until the 1960s and, as the noble Baroness, Lady Cohen, pointed out, did not finish until 1990. But the advantages of compulsory registration are enormous.
However, the 1925 Act is now showing its age and it has become encrusted with barnacles. Undoubtedly it is time for a major overhaul. Furthermore, the prospect of electronic conveyancing opens up new opportunities for the speeding up of the sale of land. I should like to congratulate the Law Commission, and in particular Mr Charles Harpum, on what appears to have been a superb job. The Bill reforms the registration procedure and simplifies it considerably. Under the existing system various mechanisms are in place for limiting the powers of a registered owner to deal with the land. These are variously cautions, notices, restrictions and inhibitions. The new Bill simplifies these. It keeps notices and restrictions, but throws caution to the winds and abandons all inhibitions. Does this mean that, when the Bill is enacted, there will be Bacchanalian riots in the Land Registry—and can I have an invitation?
The Bill proposes a tightening of the rules for overriding interests; that is, interests in land which will bind purchase of the land even though it has not been entered on the register. That is undoubtedly welcome. Certainty is extremely important for land transactions and overriding interests have been a major source of uncertainty. The creation of new overriding interests by judicial decision has weakened the certainty of the 1925 Act. I welcome the proposal that some interests which are now overriding interests, but could be registered, will cease to be overriding unless they have been registered within a 10-year period.
I have to say that I am not sure what has happened to my old friend the liability attached to a particular piece of land to pay for repairs to the chancel of the parish church. That is an obscure and fortunately rare problem, but very unpleasant when it happens. It is true that a few weeks ago it was held by the Court of Appeal that that was contrary to the European Convention on Human Rights. I found that decision rather surprising and obviously it could be overturned
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by an appeal either in that or in another case. I shall be interested to know in due course whether that has ceased to be an overriding interest and, if so, what is its status.
The proposal to require leases to be registered if the term of the lease is more than seven years rather than more than 21 years is desirable because it will increase the informative value of the register and ease the transfer of longer leases. I agree with the noble Earl, Lord Caithness, that a reduction in the minimum period for registrable leases to below seven years may be of more questionable value. That is obviously something which will have to be looked into if and when proposals are put forward so to do.
The 1925 Act was designed so as to minimise differences of substantive law between registered and unregistered land. I believe that that was the right decision to take at the time, but now that the great majority of land is registered, it is time to abandon that particular principle, which the Bill sets out to do. I therefore welcome the new system to be put in place under Clause 49 to allow an existing charge to be treated as security for a further advance.
The most important difference in substantive law is in relation to adverse possession. The Bill proposes new rules for adverse possession which will make it harder to acquire title by that means. Possessory title was very important in cases of unregistered conveyancing where the loss of title deeds or an uncertain description of the land might make long and undisputed occupation the only way of showing title. However, this does not apply to registered land. The new procedure for acquiring title by adverse possession under Schedule 6 is reasonable, although I should like to raise one or two points of detail when we reach the Committee stage. However, perhaps I may say that, contrary to what was said by the noble Lord, Lord Harrison, this change will help rather than hinder squatters because unless and until squatters in a particular building serve an application for title to that building under Schedule 6, the owner will not be under any pressure to remove them.
I greatly welcome the proposal for a new independent adjudicator to decide disputes under the Bill. I strongly support this development. I would prefer to see disputes dealt with by adjudicators rather than by the courts, but the question does arise whether an adjudicator will be given power under Clause 60 of the Bill to fix boundaries. It is desirable that he or she should have a power to do so. Indeed, from the notes that have been submitted to the Delegated Powers and Deregulation Committee, which will consider the Bill tomorrow morning, it appears to be the Government's intention that the adjudicator should be given that power. But it does not appear to have been included in the adjudicator's jurisdiction under Clause 106.
I welcome the provisions in Clause 124 widening the membership of the Rule Committee by the addition of representatives from the Council of Mortgage Lenders and the Council of Licensed Conveyancers. However, I should like to ask why there should not also be a representative from the Royal Institute of Chartered

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Surveyors, who would appear to have a clear interest in this matter. Furthermore, should we have a representative from the Consumers' Association or some other consumer group?
Finally I turn to what in the long run will be the most important element in the Bill; that is, the framework for electronic conveyancing. Of course it is only a framework which will have to be fleshed out by future rules. I do not in any way object to that; it is the obvious and sensible way of dealing with issues as complicated, detailed and subject to periodic variation as these rules will need to be.
I believe that these changes offer a real chance to speed up and simplify conveyancing and to reduce costs. I have always thought that electronic conveyancing would be a better way forward than the seller's pack provisions set out in Part I of the Homes Bill. I am afraid that I do not agree with the noble Baroness, Lady Cohen, that the seller's pack—or at least in the form in which it appeared in that Bill—was a good idea. Now that Part II of the Homes Bill has been reintroduced as a separate homelessness measure in the other place, can the noble and learned Lord the Lord Chancellor confirm that Part I has been consigned to the dustbin?
Undoubtedly electronic conveyancing will need careful study. The Law Society has concerns about the authentication of documents by agents under Clause 91 Furthermore, I know that the RICS also has concerns about the security of e-conveyancing. Overall, however, the Bill plainly represents a major step forward which, I believe, could be of real benefit to everyone in the property market, in particular to ordinary people who are buying and selling their homes. For that reason, I have great pleasure in giving the Bill a warm welcome.
4.28 p.m.
Lord Kingsland: My Lords, first, I should like to apologise to the noble and learned Lord the Lord Chancellor for not being present to hear the opening passages of his speech. So mesmerised was my television screen by the answers given by the noble Lord, Lord Filkin, to the third Starred Question that it totally failed to move on to the fourth Question, let alone to turn to the dulcet tones of the noble and learned Lord. That should serve as a warning to those of us tempted to throw ourselves entirely on the mercy of electronic means.
Nevertheless, from the Opposition Benches I warmly welcome this Bill. In particular, I should like to congratulate the noble and learned Lord on bringing forward a Law Commission proposal. I know that he is keen to take every opportunity to do so and I hope that this will not be the last such Bill in this parliamentary Session. I should also like to congratulate, as have several other noble Lords, Mr Charles Harpum, together with the parliamentary draftsmen involved, on what has been a remarkable achievement. Any hesitations that I am about to express about the Bill should be seen in that overall context.
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Residential property is the single most important asset held by the majority of the citizens of this country. Our predominating preoccupation therefore is with the security of transactions, in general, and, in particular, with the dangers or risks of tampering with electronic signatures. In that context, I should like to ask a number of questions.
How can these signatures be kept secure? If a so-called smartcard is stolen, can it be used by a thief? How can the user be confident that the certifying authority's certification is genuine and not the creation of a hacker? Who certifies the certifying authority? Is there a risk of impersonation to obtain certification for signatures? Is it possible to prevent the time of signature of a contract being tampered with?
I say at once that I do not expect the noble Baroness to answer all these questions in her closing speech. But, nevertheless, I submit that they are important questions. I hope that at least in the course of the committee stage we can return to them for some reassurance.
As a number of noble Lords have said, in particular my noble friend Lord Dixon-Smith, the Bill abounds with rule-making powers. My noble friend said that the Bill was much easier to understand, but I suspect that there is much more to the Bill than is on its face. Indeed, your Lordships can open the Bill at almost any page and find a rule-making power. Even Clause 1 of the Bill has a rule-making power.
I wonder whether this is at the insistence of Ministers or of parliamentary draftsmen, or are these rule-making powers a function of the fact that, although we have had the Quinquennial Review, the plan that will flow from that review is not yet complete? These perhaps are also questions that the noble Baroness may be tempted to address, either later today or in the course of the Committee stage.
It appears to us that in some circumstances such rules could restrict, or even extinguish, the very rights granted. Consider, for example, Clauses 66 and 73, which refer to rights expressed to be "subject to rules". Here the rule-making power does not merely regulate the manner in which the rights are to be exercised; it makes the right itself subject to the rules. The rules restrict, or appear to restrict, the right.
Moreover, there are some rule-making provisions which are, in my submission, inexcusable. In Clause 89, for example, it is provided that rules may make provision for enactments relating to settlements under the Settled Land Act 1925. Why on earth cannot such rules appear on the face of the Bill? We all know what they will contain.
There are also some puzzling anomalies in the Bill. For example, Schedule 1 deals with unregistered interests which override first registration. On first registration, almost all occupiers' rights, easements and profits à prendre are binding. Schedule 3 deals with unregistered interests which override registered dispositions.
Under this schedule, occupiers are deprived, on completion, of registered dispositions if they do not respond to inquiries or if their occupation is not

795
obvious on inspection. Again, the dominant owner in respect of all legal easements and profits à prendre is deprived unless the person to whom the serviant land is transferred actually knows of the right, or it would be obvious on inspection of the serviant land, or it has been exercised in the previous year.
Thus a right which survives first registration can be overridden by an immediate disposition, which will, on the face of it, inevitably defeat the purpose of the special treatment of occupiers on first registration.
Another change which we, on these Benches, find surprising is the new test for "actual occupation" in paragraph 2 of Schedule 1. This provides that,
"a person is only to be regarded as in actual occupation of the land if he, or his agent or employee, is physically present there".
As the usual issue is at what times or during what periods the occupier is or was present, this definition does not grapple with the issue of the degree of continuity or permanence which may be required. What happens if the occupier is on holiday? What happens if the occupier is at work at the time of the disposition? Is it enough for the occupier's furniture to be physically present? Presumably not because the provision requires the occupier or his agent or employee to be physically present. Must a solicitor or conveyancer attend on completion to carry out a reasonably careful inspection? It also does not appear to deal with cases where the occupier has taken steps to exclude anyone from occupation but is neither there himself nor by his agent, employee or otherwise. In my submission, the new provision is manifestly defective.
The existing law, by contrast, is clear. It has been considered most recently in Williams & Glyns Bank v. Boland and City of London Building Society v. Flegg. We cannot understand why it has been necessary to introduce a new provision which itself does not deal with the usual issue that arises.
The Bill also creates surprising differences between the law relating to registered land and unregistered land. Part 9 and Schedule 6 to the Bill introduce a new regime for dealing with adverse possession in relation to registered land. Clause 95 provides that no period of limitation under Section 15 of the Limitation Act 1980 runs against any person, other than a chargee, in relation to registered land.
Under paragraph 1 of Schedule 6, a person who has been in adverse possession can apply to be registered. Paragraph 5 of the schedule provides that if the applicant can show that one or more of three conditions apply, he or she is entitled to be registered as the new proprietor of the estate. Paragraph 6 of the same schedule provides that if the applicant's application for registration is refused but he or she remains in adverse possession for two more years, he or she can apply again to be registered.
These new provisions will apply only to registered land. They will not apply to unregistered land, where Section 15 of the Limitation Act 1980 still prevails. We can see no good reason why the substantive law of adverse possession should be different in the case of unregistered land. If the new provisions in the Bill are
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better than the old law, then those provisions should apply also to unregistered land. If the new law is not suitable for unregistered land, we cannot see why the new law should be suitable for registered land. In our submission, the correct approach is to amend the substantive law first, if appropriate, and then allow the Bill to deal with pure issues of land registration.
In this respect—although, of course, I have not yet seen what is contained in the document which is due to be published on 10th July—our criticisms seem to be shared by the Law Commission in its consultative document at paragraph 10.18, where it is said that there are obvious disadvantages in adopting a different system of adverse possession for registered land. Why then does the Bill provide such a system?
Finally, I turn to the question of squatters' rights. In a way, I suppose, it can be said that the Bill seeks to weaken squatters' rights. At present, after a squatter has been in adverse possession of land for 12 years, he or she can apply to be the new proprietor of the estate. The Bill allows a squatter to apply for ownership after 10 years, but ensures that the owners are informed. Of course, if the owners do not object, the squatter will be registered as proprietor of the land.
We would argue that the proposed measures against squatters should be tougher. The Library in another place cites research based on the 1986 London Housing Survey suggesting that 74 per cent of squatted properties were in the social rented sector. Indeed, there have been high profile cases in the past few years of squatters obtaining ownership of council housing due to the continued negligence of councils to manage their housing stock.
We should like see a situation in which squatters have no automatic right to ownership of property owned by social landlords or by the public sector. This property was intended for a collective social benefit and should not be seized by private individuals without appropriate compensation.
I said that my hesitations were in the context of otherwise unqualified admiration for the achievement of the parliamentary draftsmen. It is in that sense that I conclude my observations.
4.41 p.m.
The Parliamentary Secretary, Lord Chancellor's Department (Baroness Scotland of Asthal): My Lords, I am grateful to all noble Lords who have participated in the debate, not least to the noble Lord, Lord Kingsland. I was in danger of believing that we had unanimity in this House for the first time in any debate in which I have taken part. I am grateful to the noble Lord for disabusing me of that belief. I join warmly with all those who have congratulated the parliamentary draftsmen, together with Charles Harpen. As my noble and learned friend the Lord Chancellor said, the Bill is truly a wonderful piece of work.
I had the opportunity of delighting your Lordships with a long and detailed reply. However, with respect, bearing in mind the amount of agreement that there has been, it may be better if I seek to reply more directly to the various issues raised.

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It is clear that we all agree that the changes and reformation that will be brought forward by this piece of legislation are momentous. The noble Earl, Lord Caithness, raised a number of points. In welcoming the Bill—on which I commend him—the noble Earl raised the issue—also mentioned by the noble Lord, Lord Goodhart—of the role of the adjudicator and whether the adjudicator would be able to decide in cases where there are boundary disputes. The short answer is yes. However, the Land Registry will also be looking for other, easier ways to settle land disputes.
In relation to this matter and many others we should be happy to consider any proposal that the noble Earl or other noble Lords may wish to make. One of the good things about the Bill is the consensual basis on which it is founded. It has been evident in the debate that all noble Lords wish to hone a system that will deliver transparency, efficiency and an effective means of transferring land. Speaking both for myself and on behalf of my noble and learned friend the Lord Chancellor, we very much want the Bill to be seen in that light. We shall be open to any improvement that noble Lords may feel able to bring to it.
The noble Earl turned next to the question of Ordnance Survey maps. I can reassure him that the relationship with the Ordnance Survey map will not change significantly in electronic conveyancing. On the question of whether we shall set up a pilot scheme for electronic conveyancing, the short answer is yes. Implementation will be staged. We, too, understand the thrust of the argument of those who say that compulsion should be immediate. However, we want to have the benefits assured before going down that road. The noble Earl asked about electronic auctioneering. That does not currently fall within the scope of the Bill. I can write to the noble Lord in more detail on the matter.
The noble Earl also raised what some have seen as a controversial provision in Clause 4 relating to the registration of a lease and the reduction in the period from 21 years to seven years, and the fact that it may bring about more bureaucracy. We do not believe that that will be the case. There will be more registration, but there will be a simpler system of law and quicker conveyancing which will save business money on each transaction. So, overall, the procedure will be more efficacious.
My noble friend Lady Cohen referred to the Government's commitment to the seller's pack. Neither this Bill nor the commonhold and leasehold Bill will contain provision relating to the seller's pack. However, it will not have escaped your Lordships' notice that the mischief that the seller's pack sought to cure is dealt with in material ways by this Bill. I shall say nothing about whether or not in due course there will be parliamentary time for further legislation. We shall have to wait and see. For the moment, our commitment to delivering a clear system will be dealt with in part by the passage of the Bill that is before the House.
My noble friend made the point that the registration of land already has a certain coherence which is not always present in relation to unregistered land. I say to
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my noble friend that one has to eat an elephant in small bite-sized pieces. It will take time. We are addressing what we believe to be the most effective way of extending the system to cover it so that the general public and those who deal with it on a professional basis will be able to use it easily.
My noble friend Lord Harrison, in his usual forthright and robust way, raised a number of issues. The first related to making all overriding interests disclosable. That duty is created by Clause 71. We believe that that will help greatly.
My noble friend also exhorted us to cut red tape and asked why we did not introduce a three-year period from the outset. We want to be sure that the Land Registry and the market will cope. My noble and learned friend the Lord Chancellor can reduce the period when it appears to him to be right. During his opening remarks my noble and learned friend made it clear that he will consult, and all noble Lords know that he will adhere to that promise.
My noble friend Lord Harrison asked about the Northern Irish and Scottish systems, which are very different from our own. The Land Registry in England and Wales is working closely with registrars in Scotland to ensure that, so far as possible, the two systems will be similar from the point of view of the users.
The Bill stands alone, and its Explanatory Notes assist it. I know that noble Lords would have been "happier" if the report had been made available before Second Reading and, indeed, for a longer period before the Committee stage. Of course, that is a counsel of perfection. Bearing in mind that we have waited since 1925 for reformation of this area, I shall disclose quite frankly that we were not going to allow this opportunity to slip us by. The Bill team is ready; we shall consult, and shall continue to do so, to ensure that the legislation is as perfect as we should all wish. But time is of the essence and we are happy to have the opportunity to bring forward this Bill, which will do so much good, at the earliest possible moment. It is a matter of some pride to us that we are able to do so. I should like to pay a compliment to all those who worked before 1997 to help to bring this about; indeed, the gestation period of this Bill has been long.
Like the noble Lord, Lord Kingsland, the noble Lord, Lord Dixon-Smith, also raised the issue of the rule-making power, and questioned whether it was too wide. The power referred to exactly replicates the current law. However, my noble and learned friend the Lord Chancellor will happily consider suggestions about improvement. I reiterate that position. As regards the rules procedure, the noble Lord will know that most procedural rules for the registry will be made by the Lord Chancellor on advice from the rules committee and simply laid, although the House cannot amend them. The ones that need greater scrutiny will be subject to negative resolution. But, of course, they cannot be changed; they can only be accepted or rejected.

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My noble friend Lady Crawley asked about data protection and freedom of information. The short answer to her question is yes. This will be implemented by the detailed rule.
I believe that the noble Lord, Lord Dixon-Smith, asked about price information. I can tell him that the role of price information has been widely praised. It will reduce the inflationary pressure because we shall know what the previous buyer paid. The house market should, thereby, be transparent.
I turn now to the usual sagacity of the noble Lord, Lord Goodhart. It was with great appreciation that I listened to his words, which warmly welcomed the Bill. The noble Lord is known for his great depth of understanding of the law in this area. His assent has been most welcome. I believe that the noble Lord made a similar point in relation to the report. We are advised that chapter 2 of the report will be particularly helpful to all those who wish to consider it, because, as I understand it, it is a condensed over-view of the issues covered by the Law Commission and the changes proposed. I do not believe that it will materially affect the clauses of the Bill that your Lordships will be considering, but in its 400 pages it will outline such matters in great depth. I am sure that all speakers participating in this debate will scrutinise those pages with a great deal of acuity. Indeed, I am sure that noble Lords will find them most helpful.
The noble Lord, Lord Goodhart, is always adept at raising the most difficult and abstruse points. Therefore, I was charmed that he should raise chancel repair liability. I can tell him that the liability has, indeed, been struck down by the Court of Appeal. It will need to be reinstated in the Bill, and this will be considered in any appeal, if successful. We have seen no indication to date that there will be such an appeal; but, should one arise, we shall consider it.
The noble Lord also made a very good point about an RICS member being on the rules committee. We shall also be happy to consider that suggestion. There is already a power to co-opt a member who may have specific expertise. The noble Lord also asked whether this provision would help squatters because the owner of the property will not try to evict the squatters until they apply to be registered. The short answer is yes. The noble Lord, Lord Kingsland, also raised the issue of squatters' rights. I should point out to him that we shall now have clarity. There is a difference between registered and unregistered land, which is covered by the Bill. Perhaps I may sketch some of the answers that the noble Lord seeks. However, by the tempting array of issues that he covered in his speech, I know that we shall be delighted to consider such detail in Committee.
There are issues in relation to security of transaction—the tampering with signatures and whether a smartcard could be used. All those issues are valid concerns, but the detailed provisions for security can be considered in detail as rules are drawn up and changed and as the system develops. We know how rapidly technology has developed over a very short
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period of time. I do not know whether the noble Lord, Lord Kingsland, remembers such days, but I certainly remember a very profound and detailed chambers' meeting where grave consideration was given over a period of one-and-a-half hours to whether a fax machine should be purchased, whether it would "catch on" and, indeed, whether we should buy one before anyone else had such a machine.
Things have changed, and they do so rapidly. We must be able to adapt. That is why my noble and learned friend the Lord Chancellor made clear in his opening remarks that we must get the framework right. We know that the technology will develop rapidly and that the systems we put in place today may appear obsolete in a very short time. We must have the flexibility to respond when technology allows us to move forward in an appropriate way, after consultation.
The noble Lord asked what constitutes "occupation". The current law is seriously defective. We respectfully suggest that the new provisions are very much better. We should be more than happy to write and explain why we believe them to be better in an appropriate amount of detail, which I am sure will satisfy even the noble Lord. Indeed, if it does not satisfy him, I am sure that we can shower him with even more detail.
The noble Lord also raised the issue of the rule-making regime. The regime follows that contained in the 1925 Act. Although the provisions are reduced in scope by putting some questions of principle on the face of the Bill, their important nature remains the same.
Finally, the noble Lord referred to "adverse possession" and the issue of it applying only to registered land. I have already touched a little on this, but I can tell the noble Lord that a registered title is the basis of the new proposal. We cannot have the protection that it confers without registration, so the systems are fundamentally different.
I turn to over-riding rights and whether they can be over-riding on subsequent disposition. We respectfully suggest that this does not change the current law. There are issues upon which we shall continue to work. We certainly hope that we shall have the help and assistance of all your Lordships when we come to review the finer details to make sure that the minutiae of the Bill are as good as we should like.
Many people have rightly been thanked for the hard work they have undertaken in preparing the Bill. I refer to the special provisions relating to the Crown. The underlying law relating to the Crown's ancient ownership of land and its position as an owner of last resort is among the most arcane of all the many mysteries of land law in England and Wales. The Bill will simplify the task of those who come into contact with it. The pragmatic solutions put forward in the Bill would not have been possible without the detailed and constructive consultation that took place with the Crown Estate and the legal advisers to Her Majesty the Queen and His Royal Highness the Prince of Wales. We are grateful to them for their contribution.

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Last but not least, I most warmly thank all noble Lords who have taken part in the debate. We have set the tone of what is to come. I hope that the work which will be done will be given the appropriate level of applause that it deserves. This is an opportunity for us to work together for the common good. It is a matter which gives me great pleasure. I commend all the proposals to your Lordships. I beg to move.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Army Procurement
5.2 p.m.
Earl Attlee Earl Attlee rose to ask Her Majesty's Government what use they are making of the Private Finance Initiative and sponsored reserves for the procurement of heavy equipment transporters and other logistic vehicles for the Army.
The noble Earl said: My Lords, I offer a warm welcome to the noble Lord, Lord Grocott, who was introduced in your Lordships' House about three hours ago and is to make his maiden speech shortly. That may be a record. We have a common interest as I believe that we are both interested in industrial archaeology. The noble Lord is interested in steam railways and I am interested in vintage commercial vehicles.
The Question, which arose at short notice, constitutes an ideal opportunity to discuss this matter. I was tempted to talk about tanker aircraft but I shall resist that opportunity mainly due to lack of time. I shall ask about good news, not about something going wrong, or at least not badly wrong. I declare an interest as a serving TA officer and president of the Heavy Transport Association. The REME Museum of Technology, with which I am involved, may be given a tank transporter when it comes out of service. I make it clear beyond all peradventure that I have no financial or other arrangements with any defence contractor I do not act as a consultant, paid or otherwise.
Heavy equipment transporters are mainly used to move heavy armoured vehicles such as tanks. Your Lordships will be grateful to hear that I shall not weary you with technical details. Suffice to say that these are specialised vehicles designed to carry 60 to 70 tonnes. They are powerful in absolute terms, complex—as one would expect—and they require specialist tradesmen to operate them. High capital cost and technical risk are involved in procuring them.
The Government announced that the fast track consortium would be the preferred, or perhaps very preferred, bidder for the provision of about 90 heavy equipment transporters. Will the Minister explain why only 90 transporters are being bought? We currently have about 120 of the old tank transporters. An armoured regiment has at least 50 main battle tanks or derivatives Supporting units such as engineers have additional heavy armoured vehicles. In addition, the lines of communication in future operations will be
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much longer than in the old days of BAOR. They can now be measured in hundreds of kilometres. Are we not spoiling the ship for a ha'p'orth of tar? How was the requirement determined? What allowance has been made for attrition that, sadly, occurs even in peacetime? Are we relying excessively on host nation support for future operations overseas?
To date no order has been placed with a contractor. Perhaps the Minister can give us some indication of when that will happen. The procurement project is novel and significant as it involves the PFI—that is reasonably well understood—but also the first significant use of sponsored reserves, which is perhaps not so well understood. We discussed the sponsored reserves during the passage of the Reserve Forces Act 1996. I note that the noble Lord, Lord Judd, is present. He was actively involved in those discussions.
At the time I had two concerns about sponsored reserves. First, I was concerned that we could end up with sponsored reserves who were, to put t bluntly, not proper soldiers; in other words, they had, joined the sponsored reserves purely to get a job. I was concerned that if they found themselves involved in a "hot" operation, their motivation might be affected. I was also worried that the sponsored reserves might constitute an attempt to privatise the TA. The purpose of the sponsored reserves was not made specific. I hope that the Minister will be able to allay my fears in that regard.
However, there remains a key question; namely, how much military training will be undertaken by the sponsored reserves? I suggest that two weeks would not be enough but that six weeks would be satisfactory. How much military training does the Minister envisage for the sponsored reserves? I support these developments with the usual caveat that if things go wrong it is still the Minister's fault! I pay tribute to the noble Baroness, Lady Symons, and the relevant procurement team. They will have found it difficult to get certain people to "let go" and to stop interfering with the equipment manufacturer.
For 27 years I have used military equipment bought for all the wrong reasons. It was probably expensive and turned out to be unreliable. It performed poorly and was expensive to maintain. We kept the equipment well past its sell by date as we could not extract money from the Treasury to replace it with something better. The MoD should specify the capability required of the equipment and legal and standardisation requirements. The MoD should not lay down detailed technical specifications. It should leave that to the experts—namely, the manufacturers who have to compete in the commercial environment. If a contractor supplies a defective vehicle, lie will bear the financial risk and the financial penalty. The contractor should also be heavily involved in specifying and providing technical but not military training. After all, the contractor understands the equipment far better than the MoD. The same applies to technical and spares support as the contractor has a financial incentive in making sure that the relevant vehicle can be used by the Armed Forces.
There is one important point for the noble Lord, Lord Bach, to consider. The PFI constitutes partnerships between the MoD and contractors. Partnerships work best when he who can best manage a risk carries it. In my experience the MoD is extremely bad at managing technical risk. On the other hand, contractors are very good at managing technical risk. Therefore, they are best placed to carry that risk. The problem is that contractors are poor at dealing with uncertainties, for example, the rate of utilisation of a vehicle. They work on a worst case scenario for each uncertainty. If they do not do so, they could go bust if their worst fears were realised for each uncertainty.
On the other hand, the MoD is in a good position to manage risks arising from uncertainty. I urge the Minister to take all possible steps to reduce uncertainties for defence contractors in order that the contractors can offer best value.
I have two points of caution. My first refers to third party revenue. I believe that the duty of the Minister is to provide for the defence of the realm and not to be a plant hire or heavy haulage contractor. I believe PFI to be desirable because the risks will be taken by those best placed to manage them; and it is not necessary to find the capital cost in one financial year. The PFI route, therefore, should not be rejected because there is no third party revenue.
My second point of caution is about equipment disposal. One of the advantages of going down the PFI route is that the equipment can be disposed of at the optimum point in its life cycle. That will minimise whole life costs. When equipment is not obsolete, the contractor can realise a good price for it if he offers it for sale as a fleet complete with a spare parts package, specialised tooling and so on. However, under a PFI contract, if the Minister buys the equipment at the end of its useful life, the support costs of the equipment would rise exponentially. Fortunately, neither I nor the Minister will be actively involved in disposal of equipment because that will take place in about 20 years. However, as a principle of PFI we do not want to make the mistake that we made with the Mercedes Benz transporter in about 1997 or 1998. We bought the vehicles at the end of their useful life and then had to buy engines, gear boxes and so on.
I turn to the future vehicle programme. It consists of the future cargo vehicle, the future fuel vehicle—the Minister will be aware it is desperately required—and the future recovery vehicle. Can the Minister elaborate on these programmes and explain why PFI has been rejected? Having decimated the Defence Evaluation and Research Agency at Chertsey, how will the Minister be able to have a technical assessment undertaken of these vehicles?
In conclusion, I support the Minister's approach on the tank transporters. I hope that he can answer my questions about that project. However, I cannot understand his rejection of PFI for further vehicle procurement.
Normally, with a maiden speech one is able to congratulate the speaker. With the procedure today, we cannot. Perhaps we may take it as read that if I were able to do so, I should congratulate the Minister on his maiden speech.
5.11 p.m.
Lord Wallace of Saltaire: My Lords, I, too, welcome the Minister to this Chamber. I hope that he will not find it too much of a shock to discover the exaggerated courtesy of this Chamber. He will rapidly discover that the greatest insult is to say, "I'm not sure that I entirely understood what the noble Lord said". We look forward to the noble Lord's response, and to his learning the elaborate courtesies which we bat around the Chamber.
I have three questions. First, I believe in joined-up government and a joined-up defence policy. We know that the Government are committed to it and to closer European defence co-operation. It seems odd that they have chosen on this occasion an American as opposed to a European vehicle; and that they have conducted this entire experiment without apparent consultation with our European partners with whom we are most likely to be engaged in joint operations in the coming years.
On the tanker refuelling aircraft question, to which the noble Earl, Lord Attlee, referred, the same is true. It is even more the case if we are engaged in joint air operations. We are conscious that over Bosnia and Serbia the British and the Americans provided the substantial disproportion of refuelling aircraft. If one is to talk about the need for a large capacity, it is clearly sensible to do so on a joint basis rather than to pretend that we are purely on our own. In making a long-term commitment, would it not have been wise to have consulted to see whether there were efficiencies to be achieved jointly with others?
Secondly, I thought that most land armies were moving away from reliance on heavy equipment and heavy tanks. A heavy tank was the vehicle for conventional war in central Europe on the north German plain. It has also been used in the desert in the Gulf War. It is not a vehicle for peacemaking or peacekeeping. The current Bush Administration defence review in Washington raises the important question of whether equipment that is not easily air transportable is still wanted. Lighter armoured vehicles give much higher mobility. Many of us remember how long it took to get the British Army's heavy equipment from Germany to Bosnia at the start of deployment there. It was a long process. The tanks could not go through the tunnels under the Alps and had to go by sea. That took about a month. The question is how long the British Army will want to maintain the Challenger 2 force. Whether we need it over the 20-year period in which we are investing in these heavy transporters is also relevant.
Thirdly, in briefing that I have received I note a number of references to a "pathfinder" decision for the future of the private finance initiative and the concept of sponsored reserves. We know that Her Majesty's

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Government are not committed to maintaining a divide between the public and the private sector and believe in what works. Where the private sector works better, they believe that it is fine to go along with it. I have read Adam Smith. In the 18th century many believed that the provision of armed force through private contractors was the best way forward. The British Army went to the Napoleonic wars on the basis that people raised battalions and contracted with the government. Letters of marque were issued to privateers to sink foreign ships. Even as late as the Crimean war an independent contractor proposed that, for a sum, he would contract with the British Army to lay siege to and conquer Sebastopol. Unfortunately, that contract was rejected. It might have been better achieved by a private contractor than by the grossly inefficient armed forces which fought the Crimean war.
How much further do the Government expect to go in terms of the private finance initiative in the defence field and the sponsored reserves concept? A White Paper on mercenaries exists somewhere in Whitehall. We were promised that it would be published six months ago. It was not published: I understand that there were those in Whitehall who pointed out that the definition of a mercenary is difficult. Some argue that a private contractor contracting for the Government might be considered a mercenary. Sandline, an efficient private company which has undertaken a number of useful activities in particular for the Government of Sierra Leone, is far more efficient in manpower than the large and grossly inefficient UN force. That might take us back to the use of private force following free market principles as a means of delivering supporters in war.
We could go further. We know that the Defence Medical Services are extremely short of manpower and equipment at present. Can we envisage a Private Patients Plan field hospital or a BUPA field hospital as a sponsored reserved concept; or even perhaps the Tesco Fusiliers or the Sainsbury's Light Infantry as a reserve regiment? The noble Earl, Lord Attlee, worries how far the TA will in effect be privatised progressively as one goes more into the sponsored reserves concept.
I tease a little, but there is a large question about how far, in what has become one of the central issues of government—the monopoly of force by public authorities—we might go back towards the private sector. Free market principles require that when the private sector can deliver force better, we should accept that. The Government are committed to free market principles, so we need to know how far the idea is to be a pathfinder for the private finance initiative and the sponsored reserve concept and if so, how much further that might go and whether there are boundaries beyond which it will not go.
5.20 p.m.
Lord Grocott: My Lords, I am grateful to the noble Earl, Lord Attlee, for raising this short debate, not just because he has chosen an intrinsically important subject, but, on a personal note, because it gives me an opportunity to make my maiden speech within three
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hours of being introduced. That goes against all my rules of conduct, which are to spend some considerable time listening and watching whenever I enter a new environment rather than opening my mouth. I am afraid that the pressure of the Government Whips Office is so relentless and unremitting that I find myself responding to this debate today.
Speaking from the Front Bench is a great responsibility, but it is made much easier by the genuine warmth, friendship and welcome that I have encountered from so many people since my. journey a few yards down the corridor. I knew a lot of people before I came here and they gave me a nice welcome, but lots of people whom I did not know so well have also given me a nice welcome. That is heartwarming for someone preparing to make their speech.
This is described as a maiden speech, although it is my third maiden speech—if it is possible to be a maiden on three occasions. I first made one when I became the Member for Lichfield and Tamworth in 1974. In 1979, the electors of Lichfield and Tamworth decided that I should probably spend more time with my family. I spent eight years out of the House and then made another maiden speech as the Member for The Wrekin in 1987. I am now making my third maiden speech. The House will be relieved to hear that, under the terms of the Life Peerages Act, it will have to be my last maiden speech.
I mention The Wrekin and Telford in particular in this debate. We all know the enormous importance of our defence services and the debt that we owe to those involved in them. I have had the privilege to represent a constituency in which one of the major employers is still the Ministry of Defence at the Donington ordnance depot, which has more than 1,000 employees involved in storage and distribution. Another 1,000 are employed in the Avro workshops. Nearby there is also an important defence manufacturer, Alvis., which employs more than 400 people.
That has made me acutely conscious of the commitment and dedication that those employees—many of whom are friends of mine—have shown to their work. In many cases, generation after generation from the same families—father to son and mother to daughter—have worked in those shops and storage depots for more than 60 years. I am well aware of their effort, commitment and responsiveness to crises such as the recent ones in the Gulf and the Balkans.
I shall always try to be accurate and honest with the House. I would be less than frank with the House if I did not say that, important though the issue is, I am not certain that the heavy equipment transporter programme would have been my chosen subject for my maiden speech. I shall answer a number of the questions that the noble Earl, Lord Attlee, and the noble Lord, Lord Wallace, have raised.
I shall begin with some background. On 24th January this year, my noble friend Lady Symons, then Minister for Defence Procurement, announced to the House the decision to select the Fasttrax consortium, led by Brown & Root Ltd, as the preferred bidder for the private sector-financed heavy

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equipment transporter programme. That was the first programme to seek a solution under the Government's private finance initiative for an operational combat support vehicle with a significant proportion of the operational capability being delivered by sponsored reserves.
I am very much aware of the expertise of the noble Earl, Lord Attlee, in this area. I pay tribute to him and to other members of the Reserve Forces, which constitute a significant part of the country's Armed Forces. They make a crucial contribution to our military capability and to the United Kingdom's reputation as a force for good in the world. I am also grateful to the noble Earl for the kind remarks that he made about my speech before I had made it.
Before I speak about the heavy equipment transporter programme in particular, I shall make a few general comments about sponsored reserves, which I hope will answer some of the noble Earl's questions.
Under the sponsored reserve concept, a service normally provided in peacetime by contractor staff is provided on operations by staff drawn from the contractor's workforce who are reservist members of the Armed Forces. The sponsored reserve concept envisages letting contracts for services on condition that the contractor maintains in his workforce an agreed element who have volunteered to become members of a reserve force.
Sponsored reservists are therefore volunteers in the same way that regular members of the Armed Forces are volunteers. Just as for regulars, a sponsored reservist's decision to join the Armed Forces will be based on many reasons, including pay and conditions. That is how the Government view sponsored reserves. They are professionals in terms of the civilian skills that they obtain from their position as contractor staff and the military skills derived from their military training as members of the Armed Forces.
Sponsored reserves are legally required under the Reserve Forces Act 1996 to undertake training with their parent reserve force both in peacetime and when called out. Just as for regulars, they are subject to the Service Discipline Acts and service regulations while serving with the Armed Forces. However—this is an important point—in contrast to the position of conventional reservists, sponsored reserves can be called out routinely whatever the level of crisis, under the direction of the Defence Secretary through authorised officers.
The noble Earl also asked about dates. We have always intended 2003 as the date when the programme of recruiting sponsored reserves comes into operation. I shall write to him with any further details that he requires.
In the mid-1990s, it became clear that the existing tank transporter, the Scammell Commander, would soon reach the end of its economic life. It was becoming increasingly unreliable and unable, legally, to carry the Challenger 2 main battle tank at its full training weight on UK or European roads.
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The Defence Procurement Agency—or Procurement Executive as it was then—was tasked with the procurement of a replacement vehicle.
In line with the then Government's policy of considering all capital asset procurement for the private finance initiative, the procurement team considered how the project might be procured as a service rather than as a one-off purchase of equipment. The view was taken that, under PFI, it would be possible to transfer a greater level of risk and responsibility to a private sector service provider in order to achieve greater value for money for the taxpayer but emphatically not at the expense of operational effectiveness.
In order to facilitate that, the project asked industry to consider the employment of sponsored reserves. It received an enthusiastic response from bidders. Since then, a large amount of detailed close working between the Ministry of Defence and industry has led to the proposed PFI contract, which is now subject to final negotiation with the preferred bidder. I believe that a number of the points raised by the noble Earl about the nature of the relationship will be included in those discussions and negotiations. Indeed, as the noble Earl said, the main point that must be emphasised in relation to the PFI in these circumstances is that it is a partnership; it is on-going, considered and reviewed. That is, of course, the best security that we can offer to anyone who has concerns about the programme.
Under this contract, it is proposed that the contractor will be fully responsible for the provision of the whole transporter service, including managing the equipment, spares and manpower to deliver the service to the agreed performance levels throughout the contract period. In peacetime, the contractor is solely responsible for all movements of loads. For all operations, however, one-third of the operational capability will be provided by sponsored reserves employed by the contractor.
The sponsored reserves personnel will be trained by the Army. They will be fully integrated into the command structure and affiliated to each of the three existing tank transporter squadrons. On a day-to-day basis, the sponsored reservists will work and train with the regulars and, if necessary, they will then deploy with the squadron to support other operations. I believe that the concern expressed by the noble Lord, Lord Wallace, in relation to mercenaries—it is an important point—is dealt with. Their training, responsibility and involvement will be exactly as they would be if they were regular soldiers. It is extremely important to emphasise that point. I am afraid that I cannot deal with his point about Adam Smith—it is a little before my time.
The proposed contract offers significant advantages to the armed services and to the taxpayer. Making the contractor fully responsible for the provision of the peacetime service gives commanders the flexibility to release regulars to undertake core military activities. What is more, risks associated with the design, construction and maintenance of the vehicles have been transferred to the contractor.

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From a financial perspective, the PFI offers significantly better value for money than does a conventionally procured solution, with much of the saving being achieved through the contractor's ability to use his workforce to generate third party revenue when his staff are not required for military purposes.
As this project has been taken forward, a key requirement has been the need to maintain appropriate levels of operational effectiveness. In particular, by integrating sponsored reserves with regular soldiers, and through their gradual introduction, the Ministry of Defence has sought to achieve continuity of military skill and capability. Moreover, the contractor intends to recruit ex-Army regulars, many of whom welcome the opportunity to continue to serve their country but as reservist members of the Armed Forces, pursuing civilian careers and developing civilian skills. That was, and is, much in evidence in Donington, where, frequently, at the end of their military career, people move into the civilian workforce using the skills that they have deployed throughout their professional life.
As a further safeguard, the Army will have the capacity to influence the contractor's selection procedure and have the right to vet personnel during their initial selection, thus ensuring that the right calibre of people is recruited.
I turn to the subject of other logistics vehicles projects, raised by the noble Earl. Although the Defence Procurement Agency considered combining the use of sponsored reserves and PFI in other vehicles, the heavy equipment transporter programme is the only project which can take forward both concepts. Although the DPA explored operating concepts for other projects within its existing logistic vehicle programme, it found little scope for the use of sponsored reserves. That is because the types of vehicle considered are driven primarily by soldiers whose principal military roles and training are not as drivers
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but as infantry, gunners, engineers, signallers and the like. Put simply, in exploring these projects with industry, the DPA was unable to develop the type of innovative and cost-effective solution that it was able to achieve with the heavy equipment transporter.
In conclusion, our approach to the heavy equipment transporter programme is indicative of our approach in general, to which the noble Lord, Lord Wallace, referred. It is one of using sponsored reserves when there is a precise case for doing so in relation to a specific project. We are not pursuing the idea for its own sake. Where the sponsored reserves concept offers us potential benefits, as is the case with the heavy equipment transporter, our approach is to implement sponsored reserves only when the risk to operational effectiveness is totally manageable within the defence programme. Therefore, I commend the programme and its use of sponsored reserves to the House.
Finally, I repeat my thanks to the noble Earl for raising this issue and for allowing me to make my maiden speech. I also thank Members of the House for the patience with which they have listened to my remarks.
Lord Burnham: My Lords, before the noble Lord sits down and with the leave of the House, perhaps I may breach all conventions of the House and of Unstarred Questions by congratulating him on his maiden speech. It is the pleasant convention that the following speaker always congratulates and thanks a maiden speaker. On this occasion, there is no opportunity so to do. I believe that one matter made the noble Lord's life more difficult than is normally the case for a maiden speaker: he had the Minister sitting beside him passing him notes the whole time. Therefore, I again congratulate the noble Lord and hope that we shall have the opportunity to hear him many times in the near future.
House adjourned at twenty-two minutes before six o'clock.