HL Deb 24 July 2001 vol 626 cc1895-907

3 p.m.

Lord Fallconer of Thoroton

My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.—(Lord Falconer of Thoroton.)

On Question, Motion agreed to.

House in Committee accordingly.

[THE DEPUTY CHAIRMAN OF COMMITTEES (Lord Brabazon of Tara) in the Chair.]

Clause 1 [Eligibility for travel concessions: age]:

Baroness Hanham moved Amendment No. 1: Page 2, line 3, at end insert— (6) The appropriate Minister may by Order apply the provisions of this Act to any other age related travel concession related to public passenger transport services. (7) Any order under subsection (6) shall be laid before Parliament and approved by resolution of each House.

The noble Baroness said: This Bill has only two clauses and may therefore not detain us too' long. Because of its genesis, it cannot be too contentious. The intention of the Bill is to extend the provisions of the various concessionary fares schemes that have existed in some shape or form since 1995, when the legislation to make legal the activities of local authorities which had already embarked on providing concessionary fares was passed.

As my noble friend Lord Dixon-Smith reminded the House at Second Reading, the complexity of the various concessionary fare schemes arose because at that stage they were, for the most part, discretionary. Now, of course, as a result of the Transport Act 2000, there are statutory requirements to be fulfilled, and the result of this Bill before us today will be to extend all the provisions to men of 60, thus bringing everyone over the age of 60 into its scope, before it then moves the entitlement for both men and women to 65 by 2010.

For those who live in the city, and where there are good or at least adequate transport services, this universal provision will be of enormous benefit. But what of those who live in rural areas, where bus services are often less than adequate and where the only possible means of moving about is the car'? These new provisions will not help them, particularly those men who are still working, who, if they lived in areas better served by public transport, would be entitled to reduced or free fares and who, as a result, would not benefit much from the scheme. How are they to benefit from the concessions if they cannot travel by public transport because there is none? That is one of the conundrums raised by the extension of the provisions, brought about by a general lack of infrastructure in rural areas, concerns about which have been raised many times in other debates in this House.

Those who live in rural areas and qualify for concessionary fares, but find themselves unable to take advantage of them, might be assisted by their local authorities providing alternative support, such as petrol vouchers, which could be given under certain circumstances within the terms of the concessionary fare scheme. There may indeed be other options for ensuring that everyone of eligible age can take advantage of the benefit to which they have now become, or will become, entitled. This amendment would enable local authorities to table any such proposals for consideration by the Minister and ultimate endorsement by Parliament.

Baroness Scott of Needham Market

I am very grateful to the noble Lords who have tabled this amendment. I am afraid that I failed to get my amendments on this subject past the vigilant eyes of the Clerk. It is my opinion that we should use this opportunity to reconsider the question of concessionary fares for young people—an issue that I raised during the passage of the Transport Act and also at Second Reading of this Bill.

Of course, some local authorities already provide concessionary fare schemes for young people. Sadly, however, they are few and far between. They are located mostly in urban areas, although Derbyshire is a notable exception. The schemes work very well but, of course, local authorities are limited in their expenditure on such schemes, which means that they are unable to spend money on other forms of transport activity, or indeed other areas of their budget. Noble Lords would do well to consider the patchwork nature of the provision that exists for young people, and I hope the Government will address that issue.

It was precisely to avoid that sort of patchwork provision for older people that the Government brought in the concessionary fares scheme under the Transport Act. In my opinion, it would be appropriate to consider whether it would also be sensible to make such provision for younger people. I shall not rehearse the arguments that I put forward at Second Reading. In brief, they concern the issues of road safety; sustainability; encouraging young people to use alternative modes of transport to cars; and accessibility to services.

However, there is a wider issue that I should like to explore. At present there are significant structural problems in the bus industry. The proposed and expected benefits of deregulation in the 1980s have not materialised. What has happened is that the ownership of bus companies has become concentrated into very few hands. A few operators run smaller services, but they are diminishing all the time.

In addition, public money, which goes into the bus industry, goes largely to the operators on the basis of running buses, rather than containing passengers. Public money goes in through rural bus grant, local authority support grant and fuel duty rebate. In all those cases, the bus companies have an interest in running buses; they do not have an interest in carrying passengers. When we put those things together, we find that we have ended up with a bus industry which, it is fair to say, is not as passenger focused as it might be.

An interesting issue to consider with regard to using public money for concessionary fares purposes is that public money is spent only when people use the buses and we see all the benefits to the public good that accrue from that. We should be considering whether it would be a more sensible use of public money to extend the concessionary fares scheme, which is a subsidy to the passengers rather than the operators. I hope that over the summer there will be an opportunity to consider that issue, along with the more deep-rooted structural problems in the bus industry.

I should have liked to table amendments that would create a truly national scheme, rather than continuing with the fragmented local authority schemes. That, too, was ruled out of order—perhaps I should speak to the noble Lady, Baroness Hanham, about tabling acceptable amendments. Nevertheless, such a scheme is another issue that I hope the Government will take time to consider during the recess.

Lord Swinfen

Like the noble Baroness, Lady Scott, I tried to table amendments to produce a national scheme, but I was ruled out of order. I was told that the Bill was only a small one, aimed at equalising ages. However, my name has been added in support of the amendment.

I am advised that the Local Government Association agrees with the amendment, as it appears to be a good method of accommodating the association's interest in the possible extension of a statutory scheme to cover young persons in education.

Turning to the other end of the scale, I have been briefed on the amendment by the Federation of Post Office and BT Pensioners. We have moved from the very young to the very elderly—a group which I am rapidly approaching, although I shall never be a BT or Post Office pensioner. The federation hopes that the Government will put forward clear proposals for a further extension of eligibility for travel concessions, to include national public transport journeys. That would represent the clearest signal of the regard that the Government have for older people, especially those with limited financial means.

On Wednesday 4th July, Mr Bob Blizzard who is the Member for Waveney asked the Prime Minister about the Government's plans to extend concessionary travel for pensioners. The Prime Minister replied: We are going to extend it so that it will also be available for long coach journeys. … It is all part of making sure that they [pensioners] get the security and the dignity that they need in old age".—[Official Report, Commons, 4/7/01; co1.259.] However, there are no such proposals in the Bill. It does not seem to have followed the Prime Minister's wishes. The current system of local concessions should be extended to include national and through routes. Many pensioners and disabled people have to cross local boundaries when they visit relatives, go to hospital or even see their GP. To be limited to only their own local authority area is ridiculous. The opportunity should be taken to accept the amendment so that the Government can introduce a nation-wide scheme. I should like the scheme to be extended to railways as well as buses.

Lord Bradshaw

I rise to take up a point made by the noble Baroness, Lady Hanham, who suggested that country dwellers will not benefit from concessions to bus users. I came to the station this morning on a country bus, which is run under the rural bus subsidy scheme, as did about a dozen other people from the place where I live.

Many people living in rural areas use and depend on buses. I have heard it said that bus travel is not of interest to rural dwellers who all use cars, but that is not true. I urge the Government to do everything they can, not only in this Bill but in other legislation during this Parliament, to assist the bus industry and its users. We are talking today about bus users, rather than the bus industry.

I reiterate one point made by my noble friend Lady Scott. The bus industry is in a great deal of trouble. Fuel costs are rising. Wage costs are also rising considerably because people do not want to drive buses. Bus driving is an unsocial and unpleasant job which entails contending with both traffic congestion and passengers. Passengers attack drivers when buses are late because there is no one else to blame. Finally, insurance costs in the industry have risen by 35 per cent this year, as we move more and more into a situation where people use any slight accident as a platform from which to launch a substantial claim.

We on these Benches are most anxious that travel concessions are extended to people in the country as well as the town. We also implore the Government to examine closely the economics of the bus industry, because the money that they devote to rural bus grants and local authorities to support the bus industry through the rate support grant is being eroded as quickly as it is being applied.

3.15 p.m.

Lord Berkeley

I cannot support this amendment which widens the debate far beyond what I believe to be the scope of the Bill. It is slightly ironic that the Official Opposition suggest that the problems of country buses can be ameliorated by giving people over 60 petrol vouchers. After all, it was the Conservative Party which wrecked country bus services many years ago. It is good that it now recognises that fact.

I do not believe that the solution is to provide petrol vouchers to older people, who should probably not be encouraged to drive for very long. I speak as someone who is over 60. I believe that I am quite capable of driving, but it is clear that older people have more accidents. There must be other ways to encourage people who are able to receive these benefits to take advantage of adequately funded basic provision of public transport, whether it is taxis or something else. I oppose the idea of petrol vouchers.

Similarly, for young people the position is fairly chaotic. There is a variation in support between different local authorities. Certainly, children in Oxford become adults at seven o'clock every night and must pay full fare for no particular reason. Perhaps they enjoy themselves after seven o'clock but not before, but the logic escapes me. I hope that the Government will consider the introduction of much more comprehensive legislation to put right some of the problems of buses.

In conclusion, the noble Lord, Lord Swinfen, suggested that these concessions should be extended to rail. I believe that they are already extended to rail. As I am over 60 I can obtain a senior citizen's railcard which entitles me to one third off virtually every train fare. I believe that that is an extremely good concession.

Lord Falconer of Thoroton

I read the amendment moved by the noble Baroness, Lady Hanham, in the same way as the noble Lord, Lord Swinfen, and the noble Baroness, Lady Scott; namely, it aims to give power to extend the concession to different age groups. They both spoke to the proposition that it should be given to young people. That is incredibly attractive but, as both the noble Lord and the noble Baroness are aware, there is a problem of money. Such an extension would cost approximately £180 million. Therefore, although it is tempting we do not believe that that is the right thing to do.

The noble Baroness and the noble Lord are aware that in effect this Bill sets minimum requirements for local authority travel concession schemes. The delivery of those minimum requirements will be funded by central government through the revenue support grant. If there is to be anything on top of that it must be provided by local authorities. As the noble Baroness and the noble Lord are aware, local authorities in London already have discretionary powers under the Transport Act 1985 to extend concessionary travel on public transport services to young people in this age group based on individual authorities' judgment of local needs and financial circumstances. Therefore, whether to extend the concession is a judgment to be made by local authorities.

Further, separately my department is working closely with the Department for Education and Skills in developing a Connexions Card which offers a range of commercial discounts for young people in full-time education and is capable of carrying existing travel concessions.

With the greatest respect to the noble Baroness, Lady Hanham, she made a Second Reading speech about transport generally. To an extent she focused on the rural situation. Rural local authorities are entitled to give such concessions as they believe to he appropriate over and above the minimum concessions required by this and other legislation which are financed by central government. The noble Baroness made a number of broader points, which were echoed to some extent by the noble Baroness, Lady Scott, and the noble Lords, Lord Bradshaw and Lord Swinfen, about rural transport and transport generally.

The Committee will forgive me for not wanting to be drawn into a general debate about transport because that is not what this measure is about. However, to counter the point raised by the noble Baroness, Lady Hanham, about rural bus services, we have a number of initiatives in place to improve bus provision; for example, rural bus grants, quality partnerships and the Rural Bus Challenge. These measures underline the importance we attach to bus services. We are keen for additional provision to be provided, particularly in rural areas.

The noble Lord, Lord Swinfen, and the noble Baroness, Lady Scott, said that they would like a national scheme if that was possible. We think that there should be minimum levels of concessions given to local authorities. They should decide what provision there should be over and above that level. The "to go anywhere" schemes are attractive. They could be dealt with by agreement between local authorities. We are looking at this issue with the bus industry. I am obviously not in a position to make any promise in relation to that today.

Finally, there was a reference by the noble Lord, Lord Swinfen, to an Answer given about the coach issue in another place by my right honourable friend the Prime Minister. The matter was also raised by the noble Lord, Lord Bradshaw. The issue is that of coaches not being run by local authorities and not covering that area. Plainly, if a local authority service runs the coaches, that would be covered by the Bill. We are talking to the coach industry about the issue. Our intention is to extend fuel duty rebates to operators of long distance scheduled coach services in return for their offering half price fares to pensioners and disabled people. We are trying to make progress in relation to that.

I hope that I have answered all the questions raised. I should mention one other point. Changes in eligibility which could be considered desirable in the future in relation to concessionary fares can be achieved by secondary legislation under Sections 147 and 151 of the Transport Act 2000. In the light of the answers that I have given, I hope that the noble Baroness feels minded to withdraw the amendment.

Baroness Hanham

I am grateful for the Minister's response. The noble and learned Lord has given me credit for throwing the issue much wider than the words did. However, I am delighted that the amendment has given an opportunity for the Committee to have yet a further debate on the possibility of extending the concessionary fares scheme.

I tried to confine my remarks to my concern about anyone who was entitled to the benefit being disenfranchised from getting it; namely, those who might try to travel on rural buses which did not exist. None the less, the matter has had a pretty good airing for now. We may return to it later. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause I agreed to.

Earl Attlee moved Amendment No. 2: After Clause 1, insert the following new clause—

TAX STATUS Changes made under section 1 above shall not affect the tax status of any person becoming eligible to receive travel concessions in consequence of those changes.

The noble Earl said: Amendment No. 2 ensures that any person who may now become eligible for travel concessions is not inadvertently penalised under our tax laws. As my noble friend Lord Swinfen explained at Second Reading, the new concession could be seen as a taxable benefit. This could have unintended effects for men aged 60 to 64.

The purpose of the Bill is to equalise the age at which men and women become entitled to travel concessions and to end discrimination in granting concessions based on age. However, if the concession was taxed, working men would still be at a disadvantage and the overall purpose of the Bill would not be achieved. Presumably, the Government do not want to discourage men who are working from making use of the concessions now to be given to them. I beg to move.

Lord Swinfen

I support the amendment. At Second Reading I asked the noble and learned Lord the Minister a question: I wonder whether the tax authorities will consider this to be a benefit in kind and that such men will have to pay tax on it. Can the Minister assure the House that that will not be the case until such time as the pension age is equalised and men and women retired at the same time?".—[Official Report, 9/7/01; col. 945.] The noble and learned Lord answered a good many questions in his winding-up speech at the end of the debate, but he did not answer that one. I nearly got up to ask him to do so. However, he has now had time to think, to find out the answer for himself and to discuss it with other members of the Government. Perhaps he would now be kind enough to answer that question.

Lord Falconer of Thoroton

Finding the answer for myself might be to overstate the point, but I have now received clear advice as regards the position. I can assure the noble Lord and the Committee that travel concessions are not chargeable to income tax. I quite understand why this came to the mind of the noble Lord when we considered it on Second Reading. As a result of the Bill, people will be able to take advantage of the new concession before they reach retirement age. The noble Lord has made clear his concern that this concession might be considered to be a taxable benefit, but a tax charge of this nature could arise only where a benefit is provided by reason of the employment. I cite, for example, an employer who provides goods or services for his employee's private use, such as hotel accommodation, holidays or work carried out at the employee's residence. Travel concessions in the context of the Bill and the legislation which it seeks to amend are available to eligible people regardless of whether they are employed, self employed or do not work. The question of tax liability does not arise.

I should point out to the noble Lord that a number of women aged over 60 and men aged over 65 who are still in work already take advantage of their travel concession to reach their place of employment without any tax charge arising. I hope that this assurance will set the noble Lord's mind at rest.

Lord Swinfen

I am grateful to the noble and learned Lord for taking the trouble to prepare what is in fact a full answer to my question. I thank him for that, even though it has taken him around a fortnight to produce it.

Baroness Hamwee

Before the noble Earl rises to speak, perhaps I may ask the noble and learned Lord whether that answer has come from the Government as a whole; namely, does it represent the view of the Treasury as well as the Minister's own department?

Lord Falconer of Thoroton

The noble Baroness is well aware that every answer I give is a response made on behalf of the Government as a whole.

Earl Attlee

I am grateful to the Minister for his reply, but I hope that we do not encounter an over-enthusiastic tax inspector. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 2 [Commencement and transitional provision]:

Baroness Scott of Needham Market moved Amendment No. 3: Page 2, line 5, after "Minister" insert "(after consultation with representatives of local authorities)

The noble Baroness said: I beg to move Amendment No. 3 tabled in my name and that of my noble friend. At present, local authorities are still dealing with the impact of the half-fare scheme which was brought in under the terms of the Transport Act 2000. During the passage of that Bill, a number of concerns were raised by local authorities which were then reflected in our debates in this Chamber. Those concerns sought to confirm whether the moneys being made available by the Government would be sufficient to meet the costs. I think that it is fair to say that the then Minister, the noble Lord, Lord Whitty, understood those concerns. He gave an assurance that the costs would be monitored to ensure that local authorities were not severely damaged by having to fund the concessions.

However, I have to say that I was not entirely convinced by the Minister's reply in the debate on Second Reading. I did not understand exactly how the review mechanism would work. The mechanism is important in its own right, but the Bill will make it even more important. The provisions add not only a further group of people to those already entitled to take up the half-fare scheme, they also extend the eligibility to concessions on rail fares and so forth, where such schemes apply in local authority areas. Thus a significant cost to local authorities must be considered here.

In the debate on Second Reading, the Minister indicated that local authorities would be compensated when they bid for funds. Unfortunately the situation is not as simple as that because rate support grant contains an element entitled "new burdens" which is issued in one large block. That element is difficult to disaggregate even across local authorities in general. As a result, it is almost impossible to decide which local authorities will suffer more disadvantage than others. The perceived danger here—indications show that it is well founded—is that those authorities which in the past offered more generous schemes are now losing out because they did so. That is not equitable.

This amendment and, I imagine, the other amendments tabled in the grouping, is designed to ensure that a proper dialogue takes place with the Local Government Association and the Association of London Government to ensure that the mechanism for recompense is suitable. It would be useful if the Minister could take the opportunity presented by the Summer Recess to consider whether a more appropriate mechanism for recompense might be a time-limited specific compensation scheme which could be targeted at individual local authorities rather than using the somewhat blunt instrument of the rate support grant. I beg to move.

3.30 p.m.

Baroness Hanham

My Amendments Nos. 4 and 5 are grouped with the amendment we are discussing. support what has been said. As we said before, the purpose of the Bill is to equalise the age of the travel concession benefit. Therefore, it is extremely important that local authorities are compensated adequately for the costs of introducing the concessions for men aged 60 to 64, as for the other groups already eligible.

As I understand it, there is as yet no agreement between the Government and the local authority associations as regards the extra costs associated with the changes. Indeed, I am not yet aware that there has been any agreement on those associated with the provisions in the Transport Act 2000, never mind the extensions proposed in the Bill. It is incumbent upon this Chamber to ensure that the additional costs are carefully considered before there is any suggestion of the Bill's provisions being implemented; otherwise, those provisions, or those that we are considering, could be jeopardised and/or could result in cuts in the provision of concessionary fares for groups such as the blind and the disabled as well as older people.

The risks of inadequately funding local authorities can be demonstrated already by what is happening in some local authority areas where it has been reported to me that concessionary fares have been cut to the 50 per cent statutory minimum even before the implications of this Bill have been considered. The Royal National Institute for the Blind has particularly drawn my attention to its concern that such reductions would have a disproportionately serious effect on its members.

At Second Reading I drew attention to the position in London where there is a 100 per cent free fare scheme—not only on the statutory but also on the wide discretionary basis—which covers many other categories of recipient. The anticipated extra cost is some £25 million which is well in excess of the £16 million which has been suggested and half the total estimated for the whole additional expenditure. That is brought about because of the complexity of the compensation arrangements between the boroughs and Transport for London. If compensation to London were to be provided on the basis of a half fare on buses only—as has already happened with the Transport Act 2000—there would be significant extra costs to be borne by the London boroughs. I am a member of one of those boroughs. There is a danger that without proper compensation the scheme could, in some areas, have to be reduced.

The amendments in my name and that of the noble Baroness, Lady Scott, will, I hope, enable the Minister to reassure the Committee that these matters are already the subject of discussions between the department and the local authority associations. But whether or not that is the situation, I hope that he will accept the amendment so that both those who expect to benefit fully from the provisions in the Bill, and those who will have to pick up the tab, can be reassured that the provisions will not be introduced without proper financial compensation being agreed.

Lord Monson

I did not take part in the Second Reading debate on the Bill because another, more compelling, matter intervened, notably the titanic struggle between Ivanisevic and Rafter!

In rising to give my broad support to this group of amendments, I make a general observation on the Bill. I value enormously my London Transport pass. It is extremely helpful to me and in a small way it is helpful to the bus operating companies in so far as the driver of a one man operated bus spends much less time at bus stops if he or she merely has to glance at a pass rather than accepting coins and notes and dispensing change. Nevertheless, I cannot help feeling a trifle uneasy that I, and everyone in my position—like many in this Chamber—are being subsidised by those under the age of 65, and shortly by the rather smaller group of people under 60.

That blanket approach might have made good sense 50 or 60 years ago when the overwhelming majority of men and women over 60 were, indeed, much poorer than the population as a whole. But is that so today when although there are, of course, unfortunately, large numbers of poor elderly people, there are also a great many extremely wealthy ones, largely, although not entirely, due to the rise in house prices well in excess of inflation? I suspect that 90 to 95 per cent of the passengers on a round-the-world cruise where the cabins cost £25,000 or so will be over 60. So I wonder whether perhaps a little more targeting may have been justified in this case. Having made those points, I shall sit down.

Lord Falconer of Thoroton

These amendments concern the funding issues in relation to the concession. We accept that the funding for delivering the increased concession—which means extending it to men between the ages of 60 and 65, which is not the present position—will cost money. That money will come from central government. A process will need to be developed whereby, properly, the amounts of that extra cost can be assessed between central government and local government. I made it clear at Second Reading—I make it clear again—that that is the objective that central government and local government must work towards in trying to reach a solution in relation to the funding. It will be done through the revenue support grant. It would not be appropriate for there to be separate compensation schemes.

My relationship with local government has become more intense since 7th June, when I became the Minister for housing, planning, urban renewal and urban regeneration. That relationship indicates that local government is averse to specific pots of money being put in—and I am very happy to see many Members who serve in local government and to hear a loud noise of approval in relation to that—whereas some of these amendments appear to flirt with "compensation schemes", which is another way of saying some kind of ring fencing.

Let me now deal with the individual amendments against that background. Amendment No. 3 requires the Secretary of State or the National Assembly for Wales to consult with the local authority associations before bringing the Act into force. I can reassure the movers of that amendment that my department and, in Wales, officials of the National Assembly will of course be in touch with the local authority associations about commencement and implementation through the normal course of business. Furthermore, as I shall explain in a moment, the local authority associations are a vital part of the discussions which surround the local government finance settlement. In the light of the assurance that I have given, I suggest that that amendment is not necessary.

The effect of Amendment No. 4 would be to hold the Government to ransom, preventing the Act being brought into force in London until agreements are made with the local authority associations regarding the level of funding. This could potentially delay the benefits of this legislation being enjoyed by men aged 60 to 65 living in the London area. I do not know whether or not that was the intention of the noble Baroness in moving the amendment, but that is its effect. I respectfully ask the noble Baroness to reconsider that amendment and not to move it.

So far as concerns Amendment No. 5, a compensation scheme is not necessary. I do not think that the noble Baroness is really suggesting that local authorities should receive funding for the extended eligibility through their revenue support grant allocation in the usual way, and also receive compensation. I assume that she is suggesting them as alternatives in that respect.

I suggest that Amendments Nos. 4 and 5 are not needed. I can assure the Committee, as has been mentioned by the noble Baroness, Lady Scott, that we are committed to the "new burdens" principle. This requires us to reimburse local authorities for the extra costs they face. We shall be working with the local authority associations as we finalise our estimates of the financial implications for councils.

The noble Baroness, Lady Hanham, again made the point that she made at Second Reading that it is a 100 per cent concession, what are we going to do about it? The Association of London Government is very much involved in the usual revenue support grant allocation discussions with my department and in discussions on the Spending Review—as are all local authority associations—and it will no doubt be making many of the points made by the noble Baroness in the course of those discussions. But there is absolutely no harm in paving the way by making the points now. Any extra provision needed for men aged 60 to 65 will be included in the annual local government settlement. That seems to be at the very heart of the issue.

Let the reassure the Committee that the local authority associations will be consulted on our proposals for the local government settlement and that we will listen carefully to the points that they make, alongside all other representations, before taking final decisions.

The noble Baroness, Lady Scott, raised the question of monitoring, to which my noble friend Lord Whitty referred. I believe that that was in the context of saying that it is quite difficult to work out how many more people will be using the concession, because working men between 60 and 65 may use it more than men who are retired. There needs to be detailed discussion about how its use can be monitored. The bus companies will want to monitor it as much as everyone else, and that should form part of the discussions that take place between central and local government.

I hope that in the light of the reassurances that I have given, the noble Baroness will feel able to withdraw her amendment and that it will not be found necessary to move the other two amendments.

Baroness Scott of Needham Market

I thank the Minister for his reassuring words. With the single caveat that I hope the Minister's understanding of "consultation" is the same as mine—in other words, that it will mean a proper dialogue with local government—I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Hanham had given notice of her intention to move Amendment No. 4: Page 2, line 10, at end insert ", and (c) not be made until there is agreement with the relevant local government associations concerning the funding provision for the scheme in the annual Revenue Support Grant negotiations.

The noble Baroness said: The Minister has conjured up the delicious possibility of my being able to hold the Government to ransom. What could be a better parting of the ways for the Summer Recess than holding a pistol to the Government's head?

I am grateful to the Minister for his comments on the amendment. I heard clearly what he said about consultation. It is important to bear in mind that there is presently a "mismatch" as regards expectations of cost. Therefore, consultation will need to take place to ensure that London in particular is properly compensated for the costs of the scheme. In the light of the Minister's remarks, I shall not move the amendment.

[Amendment No. 4 not moved.]

[Amendment No. 5 not moved.]

Clause 2 agreed to.

Clause 3 agreed to.

House resumed: Bill reported without amendment.