Lords Sitting of 28 March 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 Guildford.

The Lord Bishop of Peterborough
Ian Patrick Martyn, Lord Bishop of Peterborough—Was (in the usual manner) introduced between the Lord Bishop of Durham and the Lord Bishop of Guildford.

Nuclear Waste: Consultation Date
2.39 p.m.
Lord Tombs Lord Tombs asked Her Majesty's Government:
When they expect to publish the consultation paper, first promised for spring 2000, in response to the Science and Technology Committee's report, Management of Nuclear Waste (HL 41), published on 24th March 1999.
The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): My Lords, as soon as possible; but this is a complex issue and the decisions involved will take many years to implement. We must get the public debate off to the right start in the right framework.
On 28th February, the Government announced proposals for the second stage of the quinquennial review of the UK Atomic Energy Authority. It identifies options for organisational change in managing nuclear liabilities. Our consultation paper will invite comments on possible organisational changes, so the review may have significant implications. We want people to be aware of them so that they have a proper opportunity to comment. The paper will be published once the review's implications are clearer.
Lord Tombs: My Lords, I thank the Minister for that reply. Is he aware that the Government have taken considerably longer not to produce a consultation paper than the Select Committee, with its slender resources, took to conduct the whole inquiry and publish its report? Will he enlighten us on the reasons for that delay, which puzzle me? It seems to me to come down to a choice between incompetence and lack of commitment. I should be grateful for his views. Finally, will he express a view—I hope that it will be a favourable one—on the extent to which the nuclear industry, environmentalists and society at large are awaiting progress on this important topic?
Lord Whitty: My Lords, neither of the reasons advanced by the noble Lord lies behind the delay. We are taking time because the issues are complex. We now have the additional complication that the review of the AEA has made recommendations and is likely to make further recommendations in its second stage that relate to organisational and institutional change, particularly in the management of liabilities and therefore in the management of waste. That will have implications. We are doing the job diligently. The proposals will take up to 50 years to implement. We need to ensure that we get the answer right, but we also need to be sure that we take public opinion with us. That is why we need a well focused public debate.
Lord Marsh: My Lords, am I correct in believing that the disposal of nuclear waste in Scotland and Wales is a matter for the national assemblies? If so, has that played any part in the delay?
Lord Whitty: My Lords, the answer, broadly speaking, is "yes" and "no".
Lord Campbell of Croy: My Lords, why do the Government appear to give low priority to such reports when the United Kingdom is uniquely fortunate in having in its second Chamber Peers with enormous experience and outstanding records in science, technology and industry, such as the noble Lord, Lord Tombs, and other members of the Select Committee?
Lord Whitty: My Lords, the Government are not giving this matter low priority; they are giving it serious consideration and are taking into account all aspects, including future institutional changes. The report of the Select Committee was much appreciated by the Government, who have, of course, responded to it. However, part of the action arising from that will be the production of the consultation paper, which will lead the public debate. Therefore, we are taking very seriously the views of the Select Committee.
Lord Marsh: My Lords, perhaps I may return to the matter of transparency. I had assumed that the answer would probably be "yes" or "no". Can the Minister explain the "yes" part of it?
Lord Whitty: My Lords, I am afraid that my enunciation may not be too clear. I said "yes" to the first part of the noble Lord's question; namely, that the devolved assemblies have responsibilities within this area, subject to international commitments, and so forth. The answer to the other part of his question is "no"; that is not the cause of the delay.
Lord Jenkin of Roding: My Lords, why did Mr Michael Meacher, the Minister responsible in the

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Commons for this area of policy, decline to accept the invitation from the Select Committee to explain the Government's policy to us?
Lord Whitty: My Lords, I am not aware that a formal invitation has been issued since the inquiry took place. The Minister has indicated that he is prepared to explain the position to the committee. However, we are still drawing up the paper. The appropriate point would be when we are about to issue that paper. We have not yet reached that point.
Lord Ezra: My Lords, does the noble Lord agree that the Select Committee's report contains some very well argued and reasoned proposals? Could those not have formed the basis for a consultation document which could have been issued some time ago?
Lord Whitty: My Lords, I certainly agree that the report contains some very well based and well argued cases. That does not necessarily mean that the Government agree with all the conclusions or that those conclusions provide the only options that are open to us. We wanted to ensure a wide debate which considered all the options and examined the process for reaching further conclusions.
Lord Craig of Radley: My Lords, one of the recommendations of the Select Committee was that plans should be made for the establishment of a new low-level waste disposal facility which could be opened before Drigg closes. Bearing in mind that Drigg will be full well before the end of the 50-year period, can the Minister give the House an indication of what plans are in place for when Drigg is full?
Lord Whitty: My Lords, it will be some years before Drigg is closed. However, I can assure the House that alternative arrangements will be made at that point. The consultation is dealing primarily with high-level waste as opposed to all waste, but it will cover what action should be followed if Drigg becomes exhausted. To put the matter in perspective, Drigg should be large enough to hold all low-level waste produced until 2050. That is the time-scale involved.
Earl Attlee: My Lords, would it not have been helpful if the electorate and interested bodies had had some idea of the Government's thinking on this matter?
Lord Whitty: My Lords, we intend to give them ah idea of the Government's thinking, but we also intend to ensure that all the options are put before them. These decisions are important and difficult and will have long-term implications, some of which will arise from what is now the review of the AEA. Therefore, we believe that we should put the full, rather than a partial, picture to the electorate and other interested parties.

Telecommunications: Local Loop Unbundling
2.47 p.m.
The Earl of Northesk The Earl of Northesk asked Her Majesty's Government:
How they respond to the announcement of the intention of the European Commission to investigate the local loop unbundling process in member states, with particular reference to the European Commission campaign to have unbundled services up and running by January 2001.
Lord McIntosh of Haringey: My Lords, the UK is not aware of any new investigation by the Commission into local loop unbundling. The Commission is actively monitoring the implementation of the regulation on unbundled access to the local loop, which came into force on 2nd January this year. We strongly support local loop unbundling as a further significant step in liberalising telecoms markets in Europe, and we are encouraging the Commission to secure effective implementation throughout the Community.
However, as well as unbundling, ADSL services, cable modems, optical fibre, broadband fixed wireless access and satellites all have the potential to offer broadband services. Our proposals for achieving the goal of having the most extensive and competitive broadband market in the G7 by 2005 was set out in the action plan, UK online: the broadband future, published on 13th February.
The Earl of Northesk: My Lords, I am grateful to the Minister for that reply. However, does he agree with the opinion put forward by the Trade and Industry Select Committee of another place that. thus far, the process of local loop unbundling in the UK has been "almost farcical"? In those circumstances, does he also accept that there is a need— some might even define it as urgent— for the Government to be involved more proactively with the process of local loop unbundling and, indeed, with the delivery of broadband generally?
Lord McIntosh of Haringey: My Lords, the Trade and Industry Select Committee did not say that. It said that the process of the bow wave was in danger of becoming almost farcical. However, that process will be at an end as at the end of this month. British Telecom has abandoned its demand management process and is prepared to take orders for any exchanges. It is prepared to do so at the rate of 200 exchanges a month.
Lord St John of Bletso: My Lords, does the Minister agree that there is enormous confusion as to the various broadband options that are available both to

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the public and to businesses—that is, IDSL, ADSL, SDSL and even VDSL'? With the roll-out of ADSL being far slower than the Government had anticipated, do the Government have any figures relating to the number of ADSL customers and, in particular, non-BT customers?
Lord McIntosh of Haringey: My Lords, the noble Lord forgot to mention HDSL and perhaps VDSL.
The figures as of this week—in other words, by the end of March—are that ADSL is available in 839 BT exchanges, which cover 50 per cent of the population and 11.5 million homes. There have been about 45,000 installations.
Earl Ferrers: My Lords, would the noble Lord the Captain of the Yeoman of the Guard kindly explain to the less initiated of us exactly what we are talking about, and would he be kind enough to do so in English and without acronyms?
Lord McIntosh of Haringey: My Lords, would the noble Lord like the long version or the short version?
We are discussing the digital subscriber loop, which could be asymmetrical. That involves using twisted copper wires—in other words, ordinary telephone wires—for digital connections, which are very much faster than normal connections.
Lord Roberts of Conwy: My Lords, is it not a fact that there has been considerable delay in loop unbundling? What effect has that had on the Government's e-commerce strategy? Who is to blame—BT, Oftel, the e-envoy or perhaps the Government themselves?
Lord McIntosh of Haringey: My Lords, I would not accept that there has been considerable delay. The European regulation came into force on 2nd January this year, as I have already said, but the necessary amendment to the BT licence took place on 8th August last year. If there is any delay at the moment, it is caused by commercial considerations rather than the failures of Oftel or BT; it is certainly not caused by the Government.
Baroness Miller of Hendon: My Lords, how would Her Majesty's Government view a decision by BT to float off the local loop into a separate company in order to provide transparent access to other telecom companies?
Lord McIntosh of Haringey: My Lords, we have not been advised of any such intention but we would consider any such suggestion seriously.

social Security: Consolidation Bill
2.53 p.m.
Lord Brightman Lord Brightman asked Her Majesty's Government:
Whether, having regard to the facts stated during the debate on the Motion that the Social Security Fraud Bill do now pass on 8th March, Part VI of the Social Security Administration Act 1992 ought to be the subject matter of a consolidation Bill.
The Parliamentary Under-Secretary of State, Department of Social Security (Baroness Hollis of Heigham): My Lords, I agree with the noble and learned Lord that Part VI of the Social Security Administration Act 1992 as subsequently amended is not an easy read. The department has been advised that consolidation is not yet necessary. We shall, of course, keep the matter under review.
Lord Brightman: My Lords, is it not astonishing to find that Part VI of the 1992 Act has been amended by no fewer than 15 Acts of Parliament over the past nine years, that Part VI has grown during that period from 12 to 26 sections, and that all the original sections have been, repealed or rewritten? Are there not existing plans for consolidation in those circumstances?
Baroness Hollis of Heigham: My Lords, I accept that the Social Security Fraud Bill, which is currently going through the other place, is complicated, but there would be a real problem if each time a programme Bill or a policy Bill, if I may use that phrase, was enacted, it was followed by a consolidation Bill. For example, in 1995 about 54 pieces of legislation were enacted, of which about six were consolidating Bills and three were financial Bills. The remaining 41 pieces of legislation amended about 500 Acts. It is therefore very difficult to maintain a rolling programme of consolidation, especially in the field of social security, where virtually every piece of legislation adds to and builds on preceding administrative Acts.
Lord Peyton of Yeovil: My Lords, is it not a miracle of understatement for the Minister to say that this mess of an Act is not very easy reading? Is it not legislation for which perhaps a successive government should apologise and hasten to put right? What on earth is the point of the database for statute law if it cannot quickly clear up this mess?
Baroness Hollis of Heigham: My Lords, for most legislation—certainly for social security legislation—there are normally three audiences. The first audience is lawyers, who will have access to commercial productions, including Halsbury's statutes and Butterworths. The noble Lord was right to suggest that the development by the Lord Chancellor's Department of the statute law database should make that information available to parliamentarians. The second audience for DSS legislation includes DSS advisers and staff and CABs. They have access to the continuously updated blue books, of which there are

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currently a dozen on social security legislation that are available to the public in libraries. They specify the current situation.
The third audience comprises people who are affected by the legislation. They will not normally want to read the law; they will want to respond to leaflets, the code of guidance, and so on. For instance, a piece of legislation may state:
"The claimant must satisfy the Secretary of State of any change of circumstances which he might reasonably be expected to know might reasonably affect the right to benefit, or to its receipt, as soon as reasonably practicable after its occurrence".
A leaflet to a claimant might say,
"If you start work, tell us straight away".
Earl Russell: My Lords, in light of the Minister's kindness in making a consolidated text available to those of us who followed the Bill in question, may I take it that she understands the case for doing what the noble and learned Lord asked her to do? Will she tell the House who would have the power to take the decision to do what the noble and learned Lord suggested, and what consultation process would have to be gone through in order to take it?
Baroness Hollis of Heigham: My Lords, as I understand it, consolidation Bills are normally carried out every 10 or 20 years. There were social security consolidation Bills in 1965, 1975 and 1992. The decision obviously involves negotiation but, basically, the department seeks advice from parliamentary counsel, who reflects and advises. I understand that the parliamentary counsel then reports to the Law Commission, which is under the scrutiny and supervision of, and ultimately accountable to, the Lord Chancellor. It is fair to say that the pivotal figure in terms of advice is the parliamentary counsel.
Lord Higgins: My Lords, is not the basic problem the increasing complexity of the Government's social security legislation? Compared with that, our exchanges on the previous Question were simple. Is it not the case that one should not have a rigid time-scale, or say that a consolidation has not been carried out for 10 years? The point is to establish how much legislation has taken place in the meantime and how much has been done by reference to earlier legislation. I hope that the Minister takes the point that was made by the noble and learned Lord, Lord Brightman, very seriously and accepts that Part VI of the 1992 Act should be reconsidered.
Baroness Hollis of Heigham: My Lords, I accept—I have not tried to suggest otherwise to the House—that tracking Bills through is a complex procedure, especially with regard to the Social Security Administration Act 1992, which was a consolidating Act. Every subsequent social security Act has built on it. I entirely accept that there is a difficulty but the suggestion of the noble and learned Lord, Lord Brightman, which was that one could peel off Part VI and consolidate it separately, would mean that one
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would split the 1992 Act into two Acts. Each of those Acts would require its own subsequent amendments and need complicated reads across, and each would have a history of subsequent amendments ahead of it. That is not the right solution. We hope that the development of the statute law database will address most of the problems that noble Lords have raised this afternoon.
Lord Swinfen: My Lords, did the Government consider introducing a Keeling schedule into the Bill? That could well have solved the problem.
Baroness Hollis of Heigham: My Lords, I understand that that was what we did.
Lord Elton: My Lords, there is a way to avoid getting into this mess. Each time a substantial amendment is made to part of another Act, the whole of that Act should be reprinted in the form in which it will subsequently be interpreted.
Baroness Hollis of Heigham: My Lords, perhaps I misled the noble Lord. I certainly took some trouble on Second Reading—gracefully acknowledged by the noble Earl, Lord Russell—to ensure that Members of your Lordships' House who were taking part in the debate had a copy of that section, as amended, so that they could "clear read" it, so to speak. In that sense, I hope that I addressed the point raised by the noble Lord, Lord Elton. We did that in terms of transparency of reading as regards that section of the Bill at Second Reading. I am sorry that the noble and learned Lord, Lord Brightman. was not a participant in the earlier stages of the Bill.
Lord Renton: My Lords, will the noble Baroness revise her opinion that consolidation is unnecessary? Consolidation reduces the costs of the administration of justice; it reduces the time taken in considering the legislation in the courts and is, therefore, in the interests of the people of this country.
Baroness Hollis of Heigham: My Lords, as I understand it, the consolidation of a Bill involves a major piece of parliamentary drafting. Therefore, it becomes an alternative to a programmed Bill. That is the advice given to me. That was a dilemma wrestled with by previous administrations, who only occasionally introduced consolidating legislation. If we were to proceed with a consolidation Bill, it would be at the expense of programme development. It would mean that all other Bills affected would need consolidation. The social security Bill that has just passed through this House amends some four other pieces of legislation. Is it the noble Lord's suggestion that they, too, should be amended? They in turn affect previous Bills. The problem is easy to identify; the

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solution is extremely complex, given the knock-on effect. I suggest that the development of the electronic database is a more appropriate way forward.
Lord Swinfen: My Lords, did the Government consider introducing a Keeling schedule into the Bill? If not, why not?
Baroness Hollis of Heigham: My Lords, as I said in answer to a question raised by the noble Lord, Lord Elton, we did indeed make available such a schedule to the Members of your Lordships' House who were taking part in the debate.

London Underground
3.2 p.m.
Lord Ezra Lord Ezra asked Her Majesty's Government:
What are their plans for the London Underground in the light of the reported failure of talks with Mr Bob Kiley, the Transport Commissioner for London.
The Minister of State, Department of the Environment, Transport and the Regions (Lord Macdonald of Tradeston): My Lords, my right honourable friend the Deputy Prime Minister and Bob Kiley yesterday had a full exchange on the state of progress on the PPP negotiations. Mr. Kiley had earlier written to the Deputy Prime Minister following recent talks between the Government and Transport for London. The Deputy Prime Minister has now replied to Mr Kiley setting out the changes to the PPP which both parties had discussed and which the Government had been prepared to consider. They were offered these in an attempt to reach overall agreement on the PPP consistent with Mr Kiley's aim for unified management control. A copy of the Deputy Prime Minister's letter has been placed in the Library.
Lord Ezra: My Lords, the Minister's response suggests that there is still scope for agreement. Is he aware that the general tenor of press comment is that there has been a breakdown and that there is a possibility of judicial review proceedings being embarked upon, which would lead to longer delay, considerable cost and an uncertain solution to the Tube problem? Can the Minister indicate whether, even at this late stage, there might be an agreement as to how this issue could be resolved?
Lord Macdonald of Tradeston: My Lords, as I said, we wrote back to Mr Kiley. He promised to reply to that letter but in fact went off and called a press conference. We are aware that London Underground received correspondence from Transport for London solicitors regarding a possible judicial review and it is therefore not for my department to comment on that. We believe that in the almost 100 meetings between our negotiators we offered Bob Kiley real concessions, including leaving the maintenance of track and signalling with London Underground and long-term
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Stable funding. We felt that we were close to agreement. I echoed last week what the mayor had said; that is, that he was optimistic and we were close to agreement. But then Mr Kiley went to the United States and came back with what we felt was a new set of demands and a hardened attitude. Therefore we await his reply.
Lord Graham of Edmonton: My Lords, has the Minister seen reports in the press that the Mayor of London said that if the Government proceed with their plans for London Underground we may well be faced with a disaster scenario comparable to Hatfield? Will he join me in condemning those reports without reservation?
Lord Macdonald of Tradeston: My Lords, the London PPP offers a much more unified structure than that which exists in the national railway. The public sector London Underground will retain responsibility for the safety of the whole network. We offered Mr Kiley the ability to intervene with the infrastructure companies on any area of safety that was cause for concern in his view, and he also had complete control over London Underground's safety case. We should remember that we have a Health and Safety Executive which is rigorous in its enforcement of safety. Indeed, that rigour made London Underground one of the safest metros in the world. The latest figures show that our London Tube is safer than other comparable systems and much safer than the New York Subway, either when Mr Kiley was there or since.
Lord Brabazon of Tara: My Lords, despite the failure of those talks, does not the Minister find it extraordinary that the Mayor of London has failed to condemn tomorrow's strike action, which will seriously inconvenience millions of people? Will the Minister join me in unreservedly condemning the strike action tomorrow?
Lord Macdonald of Tradeston: My Lords, I very much regret any disruption to the Underground and condemn this quite unnecessary strike. I hope that the mayor will join in that condemnation of the inconvenience caused to Londoners. It is not true that the strike is about safety; the RMT union demands for a safety forum have been met. Its other demands are about jobs for life and various other employment conditions. I therefore urge RMT members to follow the example of the ASLEF union and call off their strike.
Lord Clarke of Hampstead: My Lords, does my noble friend share my irritation at the media's obsession with the apparently miraculous capabilities of Mr Bob Kiley? Also, will he flesh out the comparison between the New York Subway and London Underground? Am I right in thinking that in the past decade there have been at least six incidents on

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the New York Subway resulting in injury or loss of life, and in the same period there have been no such incidents on London Underground?
Lord Macdonald of Tradeston: My Lords, I developed an amicable working relationship with Mr Kiley and would not want to put that at risk by making any personal observations. However, I hope that we will be able in the future to work with the mayor and Mr Kiley as we press on through London Underground with the implementation of the PPP. I repeat, London Underground is one of the safest metros in the world. The latest figures show that our Tube has a major injury rate of only 0.11 per cent per million against New York Subway's injury rate of 4.34 per million in the 1990s. So a number of accidents have occurred in New York. I am sure there is justifiable admiration for what Mr Kiley achieved there. But please do not talk down the efforts of our Health and Safety Executive and the many good people who have been working in the London Tube to keep it safe.
Lord Tebbit: My Lords, does the Minister agree that it will do nobody any good to try to rubbish Mr Kiley and his achievements? Further, will he agree that whenever one is acclaiming the safety record of any organisation in transport, it is just as well to have one's fingers crossed at the time? Will he explain to me what this dispute between Mr Kiley and the Government is all about? Have the Government learnt the lesson, which I hope my colleagues learnt, of the perils of any split in the authority and ownership of track and train? That was the error in the last government's privatisation of British Rail. Can Mr Kiley be assured that there will be, under the Government's proposals, absolutely no occasion on which his writ does not run through the whole of the organisation for which he will be taking responsibility?
Lord Macdonald of Tradeston: My Lords, I am happy to repeat my assurance that I do not join in any personal vituperation with regard to Mr Kiley. I also repeat what we have offered in terms of safety. I take the point that no form of transport is absolutely safe. I hope that I do not tempt fate by simply explaining London's record to date.
I repeat that in running London Underground Mr Kiley would have control of its safety case. He would have the right to appoint partnership directors to the infrastructure company boards and to approve their chief executive officers and directors of safety. If he believed that safety was at risk through the activities of the infrastructure companies, he would have the right to direct them. If he felt that they were failing in their duties in any area with problems of performance, he would have the right to step in and manage that infrastructure company.
In addition, we promised a stable funding regime for London Underground well in excess of what the previous administration put in or, indeed, what we have been able to put in in recent years. I believe that that is a comprehensive attempt to try to find a
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settlement with Mr Kiley. We remain ever hopeful that such a settlement can be reached if good sense and compromise prevail.

Liquor Advertising and Promotion Bill [H.L.]
3.11 p.m.
Lord Stoddart of Swindon: My Lords, I beg to introduce a Bill to control the advertising and promotion of liquor products; and for connected purposes. I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read a first time.—(Lord Stoddart of Swindon.)
On Question, Bill read a first time, and to be printed.

Business of the House: Debates, 29th March
The Lord Privy Seal (Baroness Jay of Paddington): My Lords, I beg to move the first Motion standing in my name on the Order Paper. Noble Lords will be delighted to hear that both today's Motions have been agreed by the usual channels.
The purpose of the first Motion is to enable the business tomorrow to be taken in the following order: first, the debate on NATS standing in the name of my noble friend Lord Macdonald of Tradeston; secondly, the debate on complementary and alternative medicines standing in the name of the noble Lord, Lord Walton of Detchant, and thirdly, the Financial Services Act 2000 (Financial Promotion) Order 2001 standing in the name of my noble friend Lord McIntosh of Haringey.
That is the order of business which has been agreed by the usual channels. However, it is necessary to suspend Standing Order 40 to enable the Motion standing in the name of the noble Lord, Lord Macdonald, to be taken first.
Moved, That Standing Order 40 (Arrangement of the Order Paper) be dispensed with tomorrow to enable the Motion standing in the name of the Lord Macdonald of Tradeston to be taken immediately after the Motion relating to the 2nd Report of the Offices Committee.—(Baroness Jay of Paddington.)
On Question. Motion agreed to.

Business of the House: Election Publications Bill [H.L.]
Baroness Jay of PaddingtonMy Lords, I beg to move the second Motion standing in my name on the Order Paper. It may be for the convenience of the House if I explain the background to this matter. The Election Publications Bill was introduced in the House yesterday. It has been agreed by the usual channels that we shall have the Second Reading today and the

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remaining stages on Thursday. The purpose of the Bill is to rescind the commencement of certain provisions of the Political Parties, Elections and Referendums Act relating to the imprint on election material which, with hindsight, was brought into force too soon.
We have introduced the Bill following representations from all three main political parties. We need to act quickly as the parties and their candidates have been preparing for—I emphasise—the local elections on 3rd May on the basis of the old imprint requirements. Such material will not comply with the new law. The proposed Bill would therefore enable the parties to work to the old requirements for a further period and so save enormous wastage. I hope that I have explained that satisfactorily.
Moved, That Standing Order 46 (No two stages of a Bill to be taken on one day) be dispensed with tomorrow to allow the Election Publications Bill [H.L.] to be taken through its remaining stages.—(Baroness Jay of Paddington.)
On Question, Motion agreed to.

Parliament Acts (Amendment) Bill [H.L.]
Read a third time, and passed, and sent to the Commons.

Tobacco Advertising and Promotion Bill
3.14 p.m.
The Parliamentary Under-Secretary of State, Department of Health (Lord Hunt of Kings Heath): My Lords, I beg to move that this Bill be now read a second time.
Smoking is the greatest single cause of preventable illness and premature death in the United Kingdom. For that reason the Government are introducing a Bill to ban tobacco advertising. Smoking kills 120,000 people in this country every year. A 35 year-old man who has never smoked can expect to live, on average, seven years longer than a contemporary who smokes cigarettes. Smoking costs the National Health Service an estimated £1.5 billion each year in England alone. As the Royal College of Physicians said in its report last year, Nicotine Addiction in Britain,
"Smoking is now recognised as the single largest avoidable cause of premature death and disability in Britain and in most other economically developed countries and probably the greatest avoidable threat to public health world-wide".
Our strategy aims to reduce the prevalence of smoking in Britain. We have put in place a wide range of measures that will help to achieve that. We are developing the most comprehensive smoking cessation programme in the world with zyban and, very soon, nicotine replacement therapy on prescription, and the development of specialist cessation support. We are also investing heavily in a tobacco education campaign.
The Government have a comprehensive programme to support smokers who wish to quit. So, why do we also need to legislate on tobacco advertising? There is
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clear evidence which suggests a link between a ban on advertising and reduced levels of tobacco consumption. There is a link between the promotion of cigarettes and the decisions of young people to start smoking. Any ban on tobacco advertising needs to be comprehensive to be effective.
An important piece of work is the Smee report, which was produced by the Department of Health's Chief Economic Adviser in 1992 at the request of the then government. Smee reviewed 19 studies, mainly from the UK and the United States, which for the most part analysed the effect of year- to-year fluctuations in advertising expenditure within those countries. While not all those studies found any statistically significant effect, Since was able to conclude that,
"The preponderance of positive results does indicate that advertising has a positive effect on consumption".
Professor Smee then went on to look at countries which had introduced comprehensive bans on tobacco advertising. The most significant of those were Norway and Finland where bans had been in place for over a decade at the time of the report. Smee concluded that,
"In each case the banning of advertising was followed by a fall in smoking on a scale which cannot reasonably be attributed to other factors".
Other recent work came to similar conclusions. The 1999 report from the World Bank entitled, Curbing the Epidemic, stated that,
"policymakers who were interested in controlling tobacco need to know whether cigarette advertising and promotion affect consumption. The answer is that they almost certainly do, although the data is not straightforward. The key conclusion is that bans on advertising and promotion prove effective, but only if they are comprehensive, covering all media and all uses of brand names and logos".
The World Bank suggests that implementation of EU Directive 98/43/EC, upon which the Bill is based, could have reduced cigarette consumption within the European Union by nearly 7 per cent.
Other recent evidence comes from American researchers, Saffer and Chaloupka, who studied data from 22 countries. They concluded:
"tobacco advertising increases tobacco consumption. The empirical research also shows that comprehensive advertising bans can reduce tobacco consumption, but that a limited set of advertising bans will have little or no effect. A limited set of advertising bans will not reduce the total level of advertising expenditure but will simply result in substitution to the remaining non-banned media. When more of the remaining media are eliminated, the options for substitution are also eliminated"
I turn to the effect of tobacco advertising on children. University of Manchester researchers in the mid-1990s found that,
"Awareness of certain brands of cigarette was linked to an increased risk of onset of smoking in 11-13 year olds, especially girls. Awareness of the most advertised brands was a strong predictor of smoking, while awareness of other brands, probably known from other sources, was a less likely predictor. Children appear to take in the messages of cigarette advertising and interpret them as generic to smoking rather than brand specific".
A study of adolescents in California between 1993 and 1996 found,

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"clear evidence that tobacco industry advertising and promotional activities can influence non susceptible never smokers to start the process of becoming addicted to cigarettes".
That is clear evidence of a link between tobacco consumption and advertising. Public health will benefit from a comprehensive ban as proposed in the Bill.
Quantification of the effects of such a ban is not an exact science, but I believe that we are about right in estimating that the provisions of the Tobacco Advertising and Promotion Bill, if enacted, could lead to a 2.5 per cent reduction in smoking prevalence and in the longer term a similar fall in tobacco-related deaths, a saving of some 3,000 lives a year.
This is a comprehensive Bill. It will ban, with limited exceptions, tobacco advertising in the press, on billboards and by electronic means such as faxes and through the Internet. It will ban mailshots advertising tobacco products, except where the customer has expressly requested information. It will ban free distributions of tobacco products and coupon schemes and it will bring to an end sponsorship agreements which promote tobacco products. It will give the Government power to regulate the advertising of tobacco products in places where they are sold and to control brandsharing which is the use of non-tobacco products with a similar name or other features to those of tobacco products.
With the support of the devolved administrations and agreement from the Scottish Parliament, this Bill covers the whole of the United Kingdom, although it provides that certain regulation-making powers shall be exercised by Scottish Ministers for Scotland.
I should mention that the regulation-making powers in the Bill have been considered by your Lordships' Select Committee on Delegated Powers and Deregulation and the committee has not felt it necessary to draw the attention of the House to any of the Bill's provisions.
Clause 1 of the Bill defines a tobacco advertisement as an advertisement whose purpose or effect is to promote a tobacco product. It also defines a tobacco product as a product consisting partly or wholly of tobacco and intended to be smoked, sniffed, sucked or chewed. We do not intend to stop general comment on smoking, but only promotion of tobacco products. If a journalist writes about tobacco products in news stories and comment pieces, he will not be committing an offence under the Bill. A news story is not an advertisement, neither is it an opinion piece.
Furthermore, the Bill will prohibit advertising which promotes tobacco products not the advertising of businesses. It is clear from the wording that specialist tobacconists and others will be allowed to provide information and listings in publications such as Yellow Pages, but not to use this to promote tobacco products.
Clause 2 of the Bill makes it an offence to publish, print, devise or distribute a tobacco advertisement in the UK or to cause such an advertisement to be published, printed, devised or distributed. I should
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stress that an offence under the Bill can be committed only where the activity takes place in the course of a business. The Bill will not stop the public at large from commenting on tobacco products or recommending them to their friends and colleagues.
Clause 3 makes it clear that where a tobacco advertisement appears in a newspaper or periodical, anyone in the chain of publication or distribution is potentially guilty of an offence, from the proprietor or editor of the newspaper through to the newsagent who sells it to the public.
Clause 4 sets out the exceptions to the advertising ban. Clause 4(1)(a) makes clear that communications between people in the tobacco trade which do not reach the wider public are not caught. Clause 4(1)(b) excludes from the Bill any material sent in response to a request for information. However, that does not permit tobacco advertisements to be sent to all customers on a database; each customer must individually request that information on each and every occasion.
Clause 4(1)(c) exempts from the general ban publications whose principal market is not the United Kingdom, while Clause 4(1)(d) provides an exclusion for the in-flight magazines on non-United Kingdom airlines.
Clause 4(2) gives Ministers powers to make regulations regarding tobacco advertisements in shops and other places where tobacco products are offered for sale.
Clause 5 provides various defences. The principle is that people should be liable only where they either know or should have known that they are involved in the publication or distribution of a tobacco advertisement. So it would not be necessary for a newsagent to check through all his publications to see whether they contain a tobacco advertisement.
Clause 5(5) and (6) provide for the position of Internet service providers and other intermediaries in electronic transactions. Such intermediaries are handling a vast amount of information. The Bill provides that such parties will not be liable when they are unaware that they are handling a tobacco advertisement. This is a stronger defence than for intermediaries in the paper chain and is necessitated by the nature of electronic media. We believe that this provides the right measure of protection for the e-commerce sector and that it is compliant with the e-commerce directive.
Clause 6 makes arrangements for specialist tobacconists' shops. There are some 350 such shops in the country, many of them long-established, small family businesses. This clause will allow such shops to advertise cigars and pipe tobacco within their shops and on their shop fronts. This exemption will not apply to cigarettes and hand-rolling tobacco and all shops will have to comply with regulations made under Clause 4(2) in respect of these products.
Clause 7 gives the Secretary of State powers to amend any provisions if it becomes necessary to do so in consequence of any developments in technology concerning publication or distribution by electronic

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means. We do not propose to treat advertising by electronic means either less or more favourably than other forms of advertising. However, the pace of technological change in this area makes it very difficult to predict what new means of publishing or distributing may emerge and we believe it is right to cater for potential developments in this way.
The Delegated Powers and Deregulation Committee has not objected to the clause either. I would stress that we have no immediate plans to make any order under this clause. If and when we feel it may be necessary to do so, the exercise of this power will be subject to parliamentary oversight by the affirmative resolution procedure.
Clause 8 gives Ministers the power to make regulations concerning the way tobacco products are displayed in places where they are offered for sale. We do not currently intend to exercise this power and the Government do not intend to change the broad status quo on the display of tobacco products for sale. We have no intention of unnecessarily increasing the burdens on small businesses, nor do we expect to change the way in which tobacco products are commonly displayed on gantries in corner shops, supermarkets and other places of sale. However, it is necessary to have a power to prevent future loopholes and abuses which may emerge.
Clause 9 will prevent the free distribution of products and coupons which promote tobacco products. These are potent marketing tools for the tobacco industry. We do not believe it is right to allow the industry to continue to give away a very wide range of non-tobacco products, such as lighters, clothes and sunglasses which clearly promote the continued consumption of tobacco products.
Similarly, we do not believe that it is right that companies should go on running coupon schemes which persuade smokers to continue smoking so they can accumulate enough coupons to claim gifts. If we allow those schemes to continue and new ones to be set up, we will be opening up a large loophole in the advertising ban.
Clause 10 prohibits anything done pursuant to a sponsorship agreement if the purpose or effect of what is done is to promote a tobacco product. I reiterate that tobacco sponsorship will end by October 2006 at the latest and that continuation of existing qualifying contracts will be subject to conditions laid out in regulations. It remains our intention to implement the policy and the timetable on sponsorship that we agreed with our European partners in 1998. Subject to consultation, that means that UK sports and events will have until July 2003 to find alternative sponsorship and that global sporting events will have until October 2006 to do the same, provided, first, that they do not sign new contracts with tobacco companies arid, secondly, that they reduce the current sponsorship that they receive between 2003 and 2006.
Clause 11 allows us to deal with so—called brand-sharing as part of our comprehensive ban on tobacco advertising. We know that the tobacco industry has in the past sought to evade restrictions on direct
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advertising by developing a strategy to use their brands on other products. This clause enables the Secretary of State to make regulations concerning the use by non-tobacco products of names, emblems and other features which are the same or similar to those used by tobacco products, or vice versa. Such regulations can apply only where their use is intended to promote a tobacco product, or has the effect of so doing.
Clause 12 makes clear that this Bill does not extend to those areas of broadcasting where existing legislation and codes of practice provide adequate safeguards to prevent tobacco advertising and promotion. This means that the BBC and most commercial television and radio services are outside the scope of the Bill. The Bill applies to those few broadcasting services which are not already regulated.
Clauses 13 to 15 deal with enforcement powers. Trading standards officers will be responsible in the main for enforcing this Bill, although Ministers will have the power to take over or institute proceedings when necessary. In general, we do not expect the enforcement burden to be very great; for example, we expect advertising on posters, billboards and in the press to be removed voluntarily.
Clause 16 deals with penalties. Alleged offences under the provisions of the Bill can be tried either summarily or on indictment. On summary conviction the maximum penalty is a fine not exceeding level 5 on the standard scale (currently £5,000) or six months' imprisonment, or both. A person who is convicted on indictment will be liable to an unlimited fine or a maximum of two years' imprisonment, or both. The option of conviction on indictment opens up the possibility of unlimited fines, which we believe will deter corporate villains. At the other end of the scale, I envisage that first offences by, say, a retailer would normally attract relatively low fines—enough to remind everyone that the law exists and will be enforced.
A comprehensive ban on tobacco advertising is part of the jigsaw that we are putting together to help to reduce the level of smoking in this country and make a dent in the toll of death and ill health caused by tobacco use. Each year 120,000 of our fellow citizens die from smoking-related diseases. That causes heartache and misery for many, many more. The Government are determined to tackle this epidemic. I commend the Bill to the House.
Moved, That the Bill be now read a second time.—(Lord Hunt of Kings Heath.)
3.32 p.m.
Lord Tebbit: My Lords, I should at once inform the House that on the odd occasion I have accepted some hospitality from the tobacco industry by way of a day's clay-pigeon shooting. It did not improve my shooting and has made no difference whatever to my views on smoking. I do not like smoking. From my experiments—by the way, I have inhaled—it spoils the taste of food, even the next day, and makes curtains smell. My wife does not like it, nor do my dogs. The memory of my days as an airline pilot when

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occasionally my room was the rendezvous for after-flight drinks remains with me still. I recall the sheer horror of finding next morning under the bed a discarded fag-end in a half-empty glass of beer. It is not a habit which appeals to me.
I cannot convince myself that smoking is good for an individual's physical health, but I acknowledge that sometimes a cigarette may be an antidote to feelings of anxiety or rage. We have only to look back to the role played by cigarettes in the camaraderie of the trenches in the First World War and the songs which still bring those events to mind.
As to this Bill, I am concerned by the scope of Clause 7 in particular. I do not like giving the Secretary of State the right when he thinks fit, in the light of developments which none of us can foresee at the moment, simply to change the legislation by order. I believe that that is a very unhealthy development. I hope that if the Bill survives Committee stage it will emerge with that power, if not removed, at least very sharply curtailed.
My principal objection to the Bill is based on humbug. I am taxed, as we all are, to provide subsidy to the growing of tobacco. Yet here we have a Bill which is designed to prohibit the advertising of a product which we are taxed to grow. As far as I know, at Amsterdam, Nice, Stockholm, or anywhere else, the Prime Minister has not raised this as a serious issue within the European Union. If we are serious about reducing the consumption of tobacco, surely we should also reduce or eliminate the subsidy for its growth. I do not accept that this Government, or their predecessors, have done anything adequate on that front.
There is humbug galore beyond that. Based on the scale of spending, the Government must regard AIDS as an even greater threat to health than smoking. Smoking has never been held responsible for causing a net decrease in the population of any country, but we are told that AIDS may well decimate the populations of a number of sub-Saharan states. What is the Government's policy? The policy is not to discourage the practice of buggery, which is the principal means by which AIDS is spread, but to encourage it. The policy is not to prohibit the advertisement of anal intercourse but to remove the restraints upon education authorities which are so misguided as to publicise the practice—of course in a non-judgmental manner—in our schools.
Lord Rea: My Lords, perhaps the noble Lord will give way for one moment. The AIDS epidemic in sub-Saharan Africa is spread predominantly by heterosexual intercourse, in association with other sexually transmitted diseases, not homosexual intercourse.
Lord Tebbit: My Lords, I am grateful to the noble Lord for putting that point of view, which is contradicted by many who have long experience in
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Africa and know perfectly well that anal intercourse is extensively practised among the heterosexual population as a form of birth control.
Lord Waddington: My Lords, perhaps my noble friend will give way. The noble Lord opposite is partly right. AIDS occurs as a result of anal heterosexual intercourse. It is anal intercourse which the Government have encouraged.
Lord Tebbit: My Lords, I do not want the debate to be side-tracked by a discussion about those matters. My point in introducing this matter is to support the charge of humbug against the Government. They proceed against smoking, and there are good reasons why. For example, I do not know how many members of the Cabinet smoke. Certainly, when it comes to votes perhaps the Government believe that smokers are now a small minority who can be treated rather harshly.
I recollect that in July 1999 I tabled two Questions for Written Answer. I asked whether it was the Government's view,
"that smoking by fictional characters in popular television soap operas such as Coronation Street and EastEnders is likely to cause young people to smoke".
I received a very robust reply from the noble Baroness, Lady Hayman, of the Department of Health:
"The Government believe that viewers, especially children, should be protected from broadcast material portraying smoking as a glamorous or attractive activity".—[Official Report, 5/7/99; col. WA 71.]
Note the words "should be protected".
Slightly mischievously, I asked a similar Question about the Government's view as to whether,
"acts of adultery, fornication, sex between juveniles, perverted sex. violence within marriage, theft, trespass, or use of drugs by fictional characters in [such] popular television soap operas…are likely to cause young people to emulate such behaviour".—[Official Report, 22/7/99; col. WA 128.]
I believe that that Question was answered by the Home Office through the noble Lord, Lord McIntosh of Haringey. I seek not to criticise him; I think he is one of the nicest and most hard-working Ministers in the Government and is essentially called on to answer anything which is awkward. But his answer was rather different. He said:
"Successive governments have acknowledged the sensitivity of broadcast output and its possible adverse effect on young people… The Government believe that, in general, the current arrangements are working well".—[Official Report, 22/7/99; col. WA 128.]
In other words, there is a difference in standards: tobacco is the ultimate sin, smoking is awful and the Government think that something should be done about it; but, in other areas, "Oh, well, the arrangements are working pretty well, aren't they?". That is another part of the charge which I make of humbug.
I have offered some explanation for the difference in attitudes towards the cause of smoking-related diseases and towards AIDS. However, there is something else that concerns me about the Bill. It is

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another example of the criminalising of activities of which the Government do not approve. Yes, it can be argued—the Minister argued very effectively—that not only should smokers be protected from themselves, but that taxpayers at large pay a heavy cost, not least in the National Health Service, for the consequences of smoking, although, as I have said, that argument is not carried through into certain other areas.
I am not sure that the Minister gave us an estimate of what the loss of revenue would be as smoking falls by the amounts anticipated, or what the saving is to the public purse in terms of pensions and other costs in respect of those who die of smoking-related diseases perhaps seven years prematurely.
As the noble Lord, Lord Stoddart, hinted before we started the debate, what about alcohol? is this like the decision to seek to prohibit hunting by hounds—a minority sport—but not fishing? There are too many votes to be lost on that issue, are there not? There would be too many votes lost on the prohibition of advertising of alcohol. So that will not be an issue. The Bill of the noble Lord, Lord Stoddart, will not progress very far. So humbug it is, and that is why I shall not support the Bill.
3.42 p.m.
Lord Walton of Detchant: My Lords, some 60 years ago when I became a medical student, I and my colleagues were strongly advised by the then dean of medicine that we should smoke cigarettes in the dissecting room and in physiology demonstrations in order to overcome the effects of the smell. We did so. Indeed, shortly after the war when I served on a hospital ship we could buy 50 Senior Service for is 8d. I used to get through a can of 50 cigarettes in two days—25 a day.
At that time none of us recognised the serious health hazards associated with smoking. But, as the results of the seminal results by Sir Richard Doll and Professor Austin Bradford Hill and others became available, it soon became apparent to members of the medical profession that smoking was a serious issue in relation to its effect on health.
At first it seemed that to smoke a pipe was significantly less damaging. So, after a struggle, I gave up my cigarettes and moved on to my pipe, which was my constant companion for some time. Twenty-five years ago I eventually gave it up. This story is not totally unrelated to a comment made by the noble Lord, Lord Tebbit. When I went with my family on a skiing holiday in Switzerland, whenever I wished to smoke my pipe, I was banished outdoors in sub-zero temperatures because the family refused to have the smell of tobacco smoke within the apartment.
So. I managed to give up smoking 25 years ago. For a year or two I had the feeling—if one can misquote the speech of Lady Macbeth—"Is it a pipe I see before me, its handle towards my hand? Come let me clutch thee. I have thee not, but yet I see thee still". Happily that feeling eventually passed. For the past 20 or more years I have had no craving for tobacco of any kind.
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There is no denying that smoking is the single biggest cause of ill health and premature death in the UK. It is responsible for nearly one in five deaths. However, it is never too late to stop. About five years after giving up one's risk of cancer, stroke and other smoking-related illnesses is greatly reduced.
At present, about 12 million people in the UK are addicted to cigarettes, well over one-third of adult men and women. Each year around 120,000 smokers die as a result of their habit. Most of these deaths are clue to lung cancer and other chest diseases such as bronchitis and emphysema, but heart disease and stroke contribute to that number. Smoking increases the stickiness of certain blood cells called platelets. These in turn increase the risk of blood clots forming in major arteries to the brain and heart. Smoking also has a seriously adverse effect upon blood pressure, causing high blood pressure, which is a major risk factor for stroke.
Professor McVie of the Cancer Research Campaign believes, along with all his colleagues, that the Bill, as it stands, will encourage smokers to quit and will, above all, help young people not to start smoking in the first place. As they say,
"tobacco is the greatest single preventable cause of cancer death and we owe it to future generations to do all in our power to reduce this toll".
They believe, as the Minister said the Government do, that an advertising ban could reduce tobacco consumption in the long term by 2.5 per cent, thus saving an estimated 3,000 lives a year.
As the Minister said, the report of Dr Clive Smee, the Department of Health's economic adviser in 1.992, after a very comprehensive study, concluded:
"The balance of evidence thus supports the conclusion that advertising does have a positive effect on consumption".
In a detailed analysis of four countries, Smee concluded:
"In each case the banning of advertising was followed by a fall in smoking on a scale which cannot be reasonably attributed to other factors".
Four countries have banned tobacco advertising—Norway, Finland, New Zealand and France. Adult per capita consumption of cigarettes fell between 15 and 34 per cent after the implementation of the ban. There were other initiatives which may have played a part in reducing that consumption. Nevertheless, the study showed that tobacco advertising bans work best when they are implemented as part of a comprehensive tobacco control policy.
Like many other noble Lords, I received the interesting photograph from QUIT, the organisation helping smokers to give up smoking, showing a tobacco advert close to the entrance to a primary school. I have also received the letter from the Tobacco Manufacturers' Association indicating that that offending advertisement was soon removed under the voluntary agreement.
Nevertheless, I draw your Lordships' attention to a most important paper published in the British Medical Journal on 3rd March of this year. This article is based upon a very careful detailed study of the smoking

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habits and knowledge about smoking of young people in north-east England carried out by Lynn MacFadyen, and others, at the University of Strathclyde. I shall not go into detail about the nature of that study; I simply quote the conclusions:
"Teenagers are aware of, and are participating in, many forms of tobacco marketing, and both awareness and participation are associated with current smoking status. This suggests that the current voluntary regulations designed to protect young people from smoking are not working, and that statutory regulations are required".
I could not possibly agree more. We owe it to the country at large and to future generations to implement the Bill, to which I give my warm support.
3.49 p.m.
Lord Haskel: My Lords, I support the Bill for all the health reasons given by the noble Lord, Lord Walton. I certainly agree that advertising affects consumption. But the Bill is not about the right to smoke or grow tobacco; it is not about humbug and it is not about sex. It is all about banning the advertising and promotion of tobacco products. It is an attempt to regulate tobacco advertising and promotion. I should like to address the single matter of regulation.
I remind your Lordships that we are firmly in deregulation mode. Noble Lords opposite are constantly criticising the Government for adding to the regulatory load—it worries the noble Lord, Lord Tebbit—and Ministers on this side of the House are constantly battling to keep regulation to a minimum. Indeed, each department has its own regulation Minister, who has to go through a Star Chamber where regulations are scrutinised. I hope that my noble friend the Minister will be sympathetic to his departmental regulation Minister because business and industry constantly complain that regulation acts as a barrier to greater productivity and to increased competitiveness. The CBI, the Engineering Employers' Federation, the chambers of commerce, the Federation of Small Businesses have all recently raised the matter of red tape with the Government.
Yet in Clauses 4 and 5 of the Bill I see that there is to be discussion about regulating point of sale advertising, about regulating displays at the entrance to shops, about the responsibility of Internet Service Providers and about regulating extending the brand to other products. The decisions will be difficult because most shops selling cigarettes sell other products, and those are often attractive to children. That will mean detailed regulation and yet more hard work for the already hard working trading standards officers.
My noble friend can be sure that if there is anything other than a complete ban, the Government will immediately receive complaints of yet more regulation, perhaps even from the shopkeepers themselves. That is why the ban must be complete. It must include no point of sale advertising; no promotion through the Internet, so that the uncertain position of Internet Service Providers is not called into question, especially where websites are established outside UK jurisdiction; and no brand stretching to
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other products in order to limit all the marketing activities carried out in any modern economy. Anything other than a comprehensive ban on all marketing activities—the noble Lord, Lord Walton, gave us the medical reasons for a comprehensive ban—will require some kind of regulation or supervised voluntary arrangement that is no longer enforceable or acceptable in today's business environment.
I hope that my noble friend the Minister will bear that in mind when responding to the debate and reassure us that noble Lords will be saved the need to move amendments in Committee to secure a complete ban.
3.53 p.m.
Lord Lucas: My Lords, I welcome the Bill. I am delighted that the Government have at last set out to deal with this difficult problem. I do not disagree with my noble friend Lord Tebbit that a great deal of humbug surrounds the Bill, but humbug is an inevitable feature of anything to do with narcotics. The whole of our discussions on alcohol, tobacco, banned substances and even substances such as caffeine are inevitably attended by humbug: what a lot of people do, we can permit; what a few people do, we try to ban. It is just the way of the world, the way of politics, the way of the media, and we have to accept it.
I tend to look at the issue and ask, "Will the Bill do good?" My answer to that is that it will help to reduce tobacco consumption, and therefore the consequences of tobacco consumption, and so it is a good Bill. However, I shall oppose the Bill as currently drafted with all my heart and to the very limits of my power. I shall do so because the Bill reverses the burden of proof in a totally unacceptable way.
It is one of the fundamental tenets of our civilisation that someone is innocent until proven guilty. There are, of course, occasions when you can trespass on that and go the other way. You can go the other way, as was said in the debate on hunting, when you are totally clear about the offence. You have to prove that it was not you driving when you were snapped by a speed camera. It is clear what the offence is. There are no fuzzy edges.
I would not feel uncomfortable about trespassing on this territory when we are dealing with extremely serious and difficult crimes—major drug trafficking and so on. There is a proposal to bring forward legislation to provide that if someone has £20 million but cannot explain how he obtained it he should have to show how he obtained it, or risk the Government at least taxing it. I do not find that unacceptable. But I do find it unacceptable that ordinary citizens and ordinary businessmen should be subject to a reversal of the burden of proof for absolutely no good reason. That is what the Bill does in several places.
The offences under Clause 2 are all absolute offences. If you have engaged in publishing, printing or distributing a tobacco advertisement, you have committed an offence. You then have to prove that you did not know that it was a tobacco advertisement. You have to prove it. There is an obligation or burden

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on you to show that you did not know. In certain circumstances, that will be impossible. Under Clause 3(c), an offence includes a newsagent selling a magazine. If a newsagent sells a magazine that has in it a tobacco advertisement and he has displayed the magazine openly on his shelves, how on earth will he prove that he did not know that there was a tobacco advertisement in it? All he had to do was look at the magazine and read it. The fact that he has so many magazines that he cannot read them all is one thing, but how can he prove that he did not read the magazine and did not know that it contained a tobacco advertisement? How can you prove that no one told you that there was a tobacco advertisement in it?
When one considers the type of people who will be subject to Clause 3(c), it is entirely unreasonable to impose a burden on proof on them. They have taken no active role in promoting tobacco. They just happen to be part of a chain which ends up including a tobacco advertisement. Under those circumstances, I cannot see any justification for undermining one of our fundamental liberties. It will put ordinary people—ordinary newsagents—in an impossible position.
The principle can also reasonably be extended to people who run big, serious businesses—I have in mind editors and proprietors of newspapers—because, necessarily, the Bill is wide in its definition of what constitutes a tobacco advertisement. It includes advertisements whose effect may be to promote a tobacco product even though that is not at all obvious. One is aware of a good many tobacco advertisements that do not appear to feature a tobacco product except for the health warning at the bottom. If the tobacco industry chooses to advertise under the ban, it will do so in very subtle ways. Why should a newspaper proprietor have to prove that he did not know that a particular advertisement promoted tobacco? Under any reasonable circumstance, if the advertisement is clearly one that promotes tobacco, it is possible to prove that the proprietor knew or should have known. But the burden of proof should be on the prosecuting authorities.
Another dimension to the problem arises in the case of internet service providers. Last year we passed the Regulation of Investigatory Powers Act. It, too, included a reversal of proof provision that we managed to get struck out. Under the Act it is a criminal offence for an Internet service provider to know what is in the e-mails that go through its wires. The Government are now seeking to make it a criminal offence not to know what is going through its wires. The ISPs will be caught coming and caught going. I do not see why it is necessary to catch them in that way with a reversed burden of proof when we have already made it impossible for them legally to know what is going through.
I agree that when we know someone is sending out Spam e-mails about advertising tobacco products we should he able to make the ISPs do their very best to stop those going through. That is entirely reasonable. But if you are notifying an ISP that something is happening, but he does not do it and you prosecute him, then he knows. The first thing that happens is that
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he is told officially that there is a tobacco advertisement coming down the wires and that he must stop it. A reverse burden of proof is not needed because it has no function. Under any practical circumstances, the ISP has been told what is happening. The ISP should be attacked only when he knows what is happening and does nothing about it. Again, there is no reason to reverse the burden of proof.
These fundamental freedoms have to be guarded at every turn. Generally we do not lose them as the result of big events; we lose them through erosion, by precedent and by letting little holes appear in the dyke and then watching the water stream out gently, imagining that that will be the end of the matter certainly not, so far as concerns the reversal of the burden of proof. This has come up in three recent pieces of legislation. We saw it in the Regulation of Investigatory Powers Bill, we have it in the Hunting Bill and we see it again in the Bill before us. It is something which I believe ought to be taken extremely seriously because it disfigures what is otherwise an excellent Bill.
4 p.m.
Lord Tomlinson: My Lords, banning tobacco advertising was a Labour Party manifesto commitment. That commitment would have been effected by the implementation of European directive 98/43/EC which would have banned tobacco advertising, promotion and sponsorship. However, that directive was annulled on the decision of the European Court of Justice on the basis of it having been introduced on an incorrect treaty base. The Bill before us today, which I support, remedies domestically the decision of the European Court of Justice and enacts the Government's tobacco control strategy.
However, at page 10 the European Commission work programme for the year 2001 states:
"In the more general field of consumer protection and public health there are plans to introduce, among other things, new proposals on the advertising and sponsorship of tobacco products".
In the Government's explanatory memorandum to the Commission's work programme, the Foreign and Commonwealth Office states:
"The United Kingdom Government warmly welcomes the Commission's intention to propose a new directive relating to the advertising and promotion of tobacco products".
On behalf of the Government, Mr Vaz continues:
"The United Kingdom Government is committed to a ban on tobacco advertising—a commitment which. following the annulment last October of the previous EC directive banning advertising, is currently being pursued domestically through the Tobacco Advertising and Promotion Bill. The Government supports the Commission in its initiative and would urge the Commission to take particular account of trans-national issues such as band-sharing and the Internet when drafting its proposals".
Like the Government's explanatory memorandum, I welcome the Commission's proposal for a new directive in 2001 in order to mitigate the effects of the ruling from the European Court of Justice.

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I also welcome this Bill, more as a token of the Government's commitment to an early European directive than as a national do-it-alone proposal. But such European action needs to be properly planned and internally consistent to avoid accusations of hypocrisy.
I am not a Euro-sceptic. I voted "Yes" in the 1975 referendum and for over a quarter of a century I have never wavered as one who believes that our membership of the European Union has been consistently of great benefit to this country and its people. Despite those views, however, I find myself in some agreement with the noble Lord, Lord Tebbit, in the first part of his speech. This is, I think, the first time that I have publicly acknowledged such agreement and I suspect that it may well be the last. However, Europe cannot expect plaudits for its planned tobacco advertising directive without being subjected to criticism over policies which are counter-productive to a ban on tobacco advertising, promotion and sponsorship.
To propose a ban on the advertising, promotion and sponsorship of tobacco on the one hand, while spending annually over 1 billion euros of taxpayers' money on subsidising the European growing of tobacco, as if it were a harmless agricultural pursuit, is clearly inconsistent at best and hypocritical at worst.
My concern is enhanced when, on looking further at the Commission work programme for 2001, I find listed under "New Measures", at Programme No. 2001/014, a proposal for a Council regulation on fixing the premium level and guaranteed thresholds in the tobacco sector. This regulation is being proposed for adoption by the Commission under a written procedure for the third quarter of 2001 and is subject only to consultation with the European Parliament, not to co-decision. One might ask: will this regulation increase or decrease the premium level? I think that the answer is self-evident and clear: it will, as it always does, increase the premium level. If that is the case, then I believe that Her Majesty's Government must oppose it. not only in the privacy of the Council meetings, but publicly—and vigorously.
If tobacco is so harmful—and I believe it is—that its advertising, promotion and sponsorship must be banned, then its European public subsidy must also be banned. The Government must not only say that they support changes to the common agricultural policy, but they must, in a high profile way, demonstrate their opposition—as a net contributor to the European budget—to its budgetary resources being disbursed to a cause which is not merely unworthy but in direct conflict with what is being seen as a public health imperative. The money saved by banning expenditure on the tobacco regime could help to support many of our sports governing bodies, which are currently finding it extremely difficult to secure alternative and continuing forms of sponsorship beyond 2003.
Perhaps I may raise another aspect of government commitment concerning action to reduce tobacco consumption. At present, the European Commission
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is engaged in a civil legal action in the United States against two American tobacco firms, R.J. Reynolds and Philip Morris. This is a civil legal action seeking compensation amounting to 3 billion euros for lost European Union revenue arising from those companies being complicit in tobacco smuggling. The European Commission has invited the member states of the European Union to join in that civil action.
My noble friend Lord McIntosh of Haringey, in reply to a question that I directed to him on 8th February, stated:
"Customs and Excise is actively considering whether to join in the case. I am sure that Treasury officials will also wish to consider this matter.—[Official Report, 8/2/01: col. 1267.]
Treasury officials did consider the matter and, in a letter dated 2nd March 2001 to the European Union Select Committee, an official from the Treasury stated that,
"the United Kingdom had decided not to join in the action because, as there is no suggestion that the United Kingdom was the destination for the smuggled product, there is no direct United Kingdom revenue loss to seek to recover and therefore it is unlikely that the United Kingdom has valid reasons for joining this action".
I urge Her Majesty's Government to think again about that answer. The Treasury official is, I believe, guilty of a most specious form of argument. In so far as revenue is lost to the European Union budget, all member states suffer, especially those which, like the United Kingdom, are net contributors to the budget. Our interest is specific, direct and calculable. Smuggling costs money. We pay more, and we should join in the action to recover moneys lost. We should do that in defence of the interests of our taxpayers.
I do not apologise for focusing on these somewhat narrow European issues. I do so because I believe that the European directive will possibly supersede the Bill. I am content for that to be the case. Indeed, I believe that there are certain advantages in the matter being dealt with in that way. However, the advantages will be seriously undermined if the European Union continues simultaneously to be both a banner of advertising, promotion and sponsorship and a subsidiser of the growth of the offending product.
4.10 p.m.
Lord Geddes: My Lords, I declare an interest as a member of the Lords and Commons Pipe and Cigar Smokers Club. Indeed, I can see at least two other noble Lords who are equally proudly wearing that club's tie today.
I should like to take this opportunity—which is almost unique, as far as I am aware—of underbidding the noble Lord, Lord Walton of Detchant. If I noted correctly, he said that he was tempted by 50 cigarettes at 1/8d. When I joined Her Majesty's Navy as an extremely junior junior some 45 years ago, I was offered and accepted 200 cigarettes for 2/4d. They were virtually unsmokeable; they were called Blue Line and were clearly the sweepings off the factory floor. Nevertheless, it was a carton of 200 cigarettes for 2/4d.

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I, too, dislike the Bill; I am against it. However, I am against it for slightly different reasons from my noble friend Lord Lucas. I am concerned about the Bill from the point of view of human rights. I notice that on the front page of the Bill—not page 1, but the front page—there is the absolutely standard claim or disclaim. I am not sure which word to use, from the noble Lord, Lord Hunt of Kings Heath. I am very glad that I am not in the noble Lord's position. That claim or disclaim states that in his view—I paraphrase, of course, because it states "In my view"—that,
"the provisions of the Tobacco Advertising and Promotion Bill are compatible with the Convention rights"—
that is, the Human Rights Act 1998. I think that the Minister will have problems in that respect. One could drill hole after hole in the Bill in that context. I do not intend to do so.
However, perhaps I may refer, as did the Minister, to Clause 4(1 )(b) and, in particular, to the Explanatory Notes to the Bill—which, interestingly, are two pages longer than the Bill itself. That may say something about the Bill. The clause and the Explanatory Notes refer to the exceptions; that is, where advertising is allowed. The notes go on to state in paragraph 17:
"However. this does not permit tobacco advertisements to be sent to all consumers on a database; each consumer must individually request that information on each and every occasion".
The Minister also quoted that passage. The paragraph goes on to state:
"A request for information cannot be considered as a request for further information in the future".
Clearly, the purpose, as I read it, is to prohibit manufacturers or sellers of tobacco products from generally communicating with smokers who are purchasers or potential purchasers of their brands, even if that communication is personal and private. This is despite the fact that the product itself is legal; that it is perfectly legal to manufacture and sell it and for adults to purchase it.
I have real problems with the conflict between a legal product—to which I shall return in a moment—on the one hand and a banning of advertising on the other. To be consistent—I hope that this does not happen—surely tobacco should be declared illegal. Then there would be some logic in the Bill and in the ban on advertising because, in that context, you would be banning advertising of an illegal product. Here you are banning advertising—or proposing to—of a legal product. I cannot get my mind around that.
I am advised by much better legal brains than mine—I am riot a lawyer—that, in their opinion, this seriously violates the fundamental freedom of speech and expression contained in the European Convention on Human Rights. This is where I have great sympathy with the Minister. The Bill bans virtually every possible means of bringing a tobacco product to the attention of smokers. The prohibition of any communication whatever, even a communication of a factual or informational nature, with regard to a product which is lawfully available—I come back to that word again—is a disproportionate restriction
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contrary to Articles 10 and 8 of the ECIIR. The Government should look at that issue extremely carefully.
I wish to raise only two other points. I have twice mentioned the question of legality. In another place, the Minister stated:
"We are relaxed about the way in which products and prices are ordinarily displayed, and we do not intend to restrict that. It is perfectly legitimate to have a certain amount of advertising at point of sale and for products to be displayed, with prices, so that they can be sold".
So far so good. The Minister continued:
"because after all tobacco is a legal product". —[Official Report, Commons, 13/2/01; col. 220.]
That brings me back to the same dilemma, but I shall not dwell on it further.
I believe that it was the noble Lord, Lord Haskel, who mentioned regulation. I totally agree with what he said. Certainly, Members of the House and many others outside the House are getting fed up with the amount of regulation. However, the problem lies in Clause 18 of the Bill. Subsections (1) and (2) of that clause are very frightening indeed. The clause states:

"(1) Powers to make regulations and orders under this Act are exercisable by statutory instrument.

(2) Regulations, and orders under Section 7. may make"—

my noble friend Lord Tebbit mentioned this—

"(a) different provision for different cases or circumstances, and

(b) any supplementary, consequential or transitional provision which the appropriate Minister (or Secretary of State) consider; necessary or desirable".

The industry does not know where it is; we do not know where it is. The Bill has holes driven right through it.
4.17 p.m.
Lord Dubs: My Lords, I very much welcome the Bill. I am aware from the statistics we have been given that, by the time I sit down in a few minutes from now, two to three more people in this country will have died as a result of smoking. That is a sombre thought. The Bill is part of a wider-ranging government strategy to tackle the problem of the large number of people in this country who die as a result of smoking. I welcome that strategy.
Looking at the history of anti-smoking measures over recent years, it is clear that raising the price of cigarettes and making them fairly expensive has proved to be one of the most effective deterrents to smoking. It discourages young people from starting and, indeed, it lessens the tendency for adults who have already started smoking to go on doing so, or they smoke fewer cigarettes.
I therefore find myself, as did my noble friend Lord Tomlinson, in agreement with the first part of the speech of the noble Lord, Lord Tebbit. I am sure that his reputation will be totally damaged if speaker after speaker on these Benches praises something that he said, but the truth must stand.
I do not share the noble Lord's views about the European Union but I agree with him that it is unacceptable that the taxpayers of Europe—including

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the taxpayers of this country—should contribute money to encourage the production of a product which we are, in other senses, trying to discourage. That is unacceptable. I hope that the Minister will hear our call and that the Government will act accordingly in their discussions in Brussels.
In relation to European Union matters, a second element is worth mentioning. People take their cars and vans across the Channel to Calais, stock up with cigarettes at prices significantly lower than here, bring them into this country and either use them themselves or sell them on. I understand that the trade is significantly damaging Treasury revenue from tobacco duties. I am not sure whether my noble friend the Minister will have that information to hand. It is also undermining the sensible policy of successive governments of increasing the price of cigarettes as a deterrent to their consumption. The volume of cigarettes coming across the Channel is now large enough to damage the effectiveness of that policy.
Lord Tebbit: My Lords, will the noble Lord allow me to intervene? I hope that it does not spoil the noble Lord's reputation to be caught agreeing with me. I hope that he will not place too much emphasis on the point that he has just made. After all, it is not only cigarettes that are in the vans and cars; it is also good, decent wine and other such products—and we do not want to get into that, do we?
Lord Dubs: My Lords, I do not disagree. Good wine comes into this country too. Although I do not buy it in Calais—I buy it in local off-licences—I understand what goes on. But, as I said, that trade undermines both Treasury policy and health policy as regards smoking, and I take exception to that. I wish our European partners had the same attitude to trying to reduce smoking as successive British governments have had. The problem would be solved if the French and other EU countries increased their tobacco taxes to the same level as ours.
That said, I am convinced that abolishing cigarette advertising would make a material difference to the number of cigarettes smoked. That is why I support the direct measures in the Bill. It is an elementary aspect of marketing that all those who sell products have to find new entrants to the market to make up for those who die—the more so when the product that they sell kills their consumers. Therefore, the danger in health terms is that young people are lured into smoking and are persuaded that it is acceptable as a result of visible advertising and sponsorship. Preventing that is the particular strength of this measure.
Perhaps I may ask my noble friend a couple of questions. I have been puzzling over the meaning of subsection (2) of Clause 10, which has the rubric "Prohibition of sponsorship":
"A sponsorship agreement is an agreement under which, in the course of a business, a party to it makes a contribution towards something".
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I am slightly puzzled as to the legislative basis for that form of wording. The Explanatory Notes seek to elaborate on the provision:
"For example. it is not intended to prevent a tobacco company supporting a theatrical production and being acknowledged for so doing, provided that the acknowledgement mentioned solely the name of the company and not any of its products. and did not involve any special treatment of the tobacco company".
I find that rather difficult. In the cigarette advertising that appears on billboards and elsewhere, frequently only the name of the company is featured. Given the explanation in the Explanatory Notes, the clause may allow the sponsorship of tobacco by mention of the company rather than of any specific product. That would be sufficient to undermine the purpose of the legislation. I hope that my noble friend will persuade me that I have got this wrong and that the Bill is more robust in that respect. I fear that that may not be the case.
I wish to raise two further points. One relates to airports and airlines. I have tried to follow the arrangements for in-flight magazines. As I understand it, cigarette advertising will not be permitted in magazines produced by foreign airlines based in this country whereas magazines produced by foreign airlines may contain such advertising. Have I got that right? My second point is a related one. What about advertising on the "air side" at British airports—when one has gone through passport control and Customs on one's way out of the country? Will the legislation apply to that element too? My noble friend nods. I hope so.
Finally, I turn to a point raised by the noble Lord, Lord Geddes. I do not believe that there is an inconsistency in permitting a habit such as smoking and accepting that it is legal but saying that advertising promotion and sponsorship should not be legal. It would be quite wrong to make smoking illegal. It might be good for the health of people in this country, but it would be wrong in principle. But I see nothing wrong in doing everything possible to discourage young people from starting down that road. That is surely the supreme strength of this measure.
4.25 p.m.
The Viscount of Oxfuird: My Lords, I wonder whether the Bill will do all the things that it purports to do. I have the view that it is totally geared to today's television mentality. It simply fails to address anything other than that which is negative; and that is essentially lazy.
Where are all the provisions in the Bill to provide an inspiration to smokers to give up? That would be positive action. All that we have before us is a further banning order, which seems to be the only thought pattern that is currently available intellectually. Perversely, a ban on advertising will have a severe effect on the very source which is important: the health warning. It must surely be possible for us to have some indication as to whether the Government regard the warning advertisement as an effective tool in the overall programme of reducing the consumption of tobacco products among the young.

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It is sad to note that, since 1997, tobacco consumption has risen by 6.5 per cent, whereas in the previous 25 years there was a persistent decline in the consumption of tobacco products; a 37 per cent reduction was finally achieved. There was a reason for that: each year there was an increase in tobacco taxation. But tobacco remained affordable; the increase did not have the effect of promoting the criminal level of smuggling that we see today.
If we look at the current situation, we see a taxation level that promotes illegal smuggling at 34 per cent; namely, over a third of the total cigarette equivalent market is now non-UK duty paid. The total loss to the Exchequer is some £9,000 million. That figure of one-third in the period since 1997 must concentrate the mind of any serious anti-smoker. It represents a massive loss of revenue. It apparently equates to 3p in the pound on the standard rate of income tax.
I know from experience with my own children that the forbidden fruit of tobacco is tried at an early age. By the time young people reach 24 or 27, they are much more involved in life: they are involved in sport and activities which take over mentally from the desire to run behind the bike sheds or whatever encouraged them to smoke in their youth.
But what effect does the withdrawal of product advertising have on the very young? They choose the product that tastes best to them and, when forewarned by the health statement, they probably choose a product with a low-tar, low nicotine content. This information and choice will be denied to them, which could possibly even add to the health risk.
I believe that we would all recognise that the young are resourceful; their income is minimal, comparatively, and the power of "word of mouth" is great. It is therefore not surprising that they will find sources of supply which will conform to their budgets. The difference between a packet of cigarettes costing £2.50 and one costing £4.33 is a very considerable incentive to seek out the illegal supplier. It is also a temptation to buy in larger quantities if their budgets permit it.
It is therefore not surprising that the effect of advertising is negated when such a disorderly market exists. I ask again the question: why is it that the Government have not carried on with the original agreement between the tobacco industry and health Ministers where these issues were discussed and solutions found? The current agreement has not been modified since 1995. As we all know, marketing is part of the total management concept. It is part of the discipline. As I said at the beginning, if one wants something to happen one has to consider all the factors by involving all the interested parties. I am convinced that the solution to a reduction in the consumption of tobacco products by the young must rely on orderly market discipline and the removal of the smuggled products over which we have no control. Therefore, we must seek the professionalism of those people who have the experience. I cannot support the Bill as it stands at present, but I look forward to tabling amendments as soon as possible.
4.32 p.m.
Lord Harris of High Cross: My Lords, I hope that it is not necessary for me to say that my fundamental opposition to this Bill runs far wider and deeper than the narrow interest I declare as a lifelong pipe smoker and the chairman of FOREST, which is the premier European organisation that defends the rights of smokers to light up, I hope always with due courtesy and consideration.
It is not necessary to be a smoker to see that outright censorship of advertising, as the noble Lord, Lord Geddes, said, whether of tobacco or any other legal product, is the plainest denial of the prized freedom of individuals to have access to the information that they wish to have At a more mundane level, this Bill would violate the right of competing businesses, including corner shops, to communicate freely, as we have heard, with their own customers.
Such a far-reaching statutory prohibition, which is unprecedented in a free society in times of peace, would require some special explanation and justification. One does not have that special justification. In a moment I shall come to the conflicting evidence in surveys on smoking and advertising.
In my view what is almost as deplorable is that this Bill marks the abrupt departure of Her Majesty's Government from the civilised practice over decades of constructive discussion and voluntary accords with the tobacco industry which, without the sledgehammer of legislation in the past, have effectively delivered restraints on advertising messages, sampling, direct marketing and the rest. Again, without precedent, an industry which is among the leading British exporters is shunned as a pariah in a display of petty puritanical pique.
The Government's justification is their hope t hat the Bill will improve health. I regard that as being highly debatable and questionable. We had similar high-minded hopes from this Government in the recent past for education, the National Health Service, crime, transport and many other things. They are hardly promising precedents. Ministers claim that ending tobacco advertising will reduce consumption at some stage in the future by 2.5 per cent. It would be difficult to reconcile that with the fact that we have just heard of consumption now rising, after decades of gentle decline, without any stimulus whatever from increased advertising. That 2.5 per cent turns out to be the purest speculation with no attempt to establish a foundation in science or experience.
In the Minister's regulatory impact assessment, we have further statistical licence. On page three it puts the cost of so-called "smoking related diseases" to the National Health Service,
"in England alone up to £1.7 billion a year".
By page six that estimate falls to,
"around £1.5 billion and £1.8 billion"
for the whole for the United Kingdom. As an effort to show the cost of smoking to the community, all these figures are completely pointless because the arbitrary

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costings ignore entirely the fact that, until recently, £10 billion was gathered every year by the Exchequer from taxes on smoking. That was before over-taxation caused the revenue to fall from £10 billion to teetering around £7 billion a year. But that is still four times the presumed cost to the National Health Service of the so-called "smoking-related diseases".
Here the Government's simplistic aim runs into further trouble. Smuggling and the illegal importation of cheap European cigarettes and hand-rolling tobacco have flooded many parts of the country with supplies at almost half the price of the corner shops, which brings a further unintended knock-on effect. By undermining retail tobacconists, who cannot legally sell to youngsters under the age of 16 years, cigarettes have become available on the streets at half-price with no questions asked.
Even this restless, reckless reforming Government should have learned some modesty from experience. Have they not learned already something about the laws of unintended consequences in education, drugs, crime and even now in the foot and mouth outbreak? At the very least they might now do themselves a favour by heeding rational arguments on the likelihood—I should say "the certainty"—that these good intentions will again be mocked by frustrating failure.
The analytical miscalculation at the heart of this Bill is the naïve assumption that advertising automatically increases the total market demand. As a serious student of advertising over many years, I say that that was the outcome in developing markets such as those for detergents, fridges, washing machines and television sets in the 1960s and 1970s. But when markets mature and approach saturation, advertising shifts to fighting over brand shares, including keeping out cheap foreign imports. Only a novice would expect that advertising a new soap, a soup or a cigarette would have us all buying more and increasing the total demand.
When one looks at these claims and counter-claims there is almost no end to it. I enjoyed the Independent, which I do not always read. It recently said that there is,
"no evidence that advertising encourages young people to smoke".
It went on to say that youngsters start smoking because it is considered "cool" among their peer group; because it helps them to lose weight; or because it is disapproved of by adults. More weighty is the report of the Office of Population Censuses and Surveys on why children start smoking. It found that advertising had no significant effect. In 1996 the hardheaded KPMG consultants found,
"overwhelming evidence to support the proposition that advertising bans on tobacco products do not reduce consumption".
Private Eye went one better, as one might imagine. In January it carried a letter from Michael Stewart who reported on a study of 22 OECD countries which revealed that the six with advertising bans showed, on
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average, an increase in consumption, compared with the trend in countries without bans. That is to say, in countries without bans smoking diminished at a certain rate, but in the six countries with bans it did not diminish at a greater rate.
Since the 1970s there have been dozens of studies purporting to test whether advertising is a significant factor in the extent of smoking. In 1999, the IEA obligingly published a report entitled, Does Advertising Increase Smoking?, by Dr Hugh High of the University of Cape Town. He reviewed what he called the "voluminous literature" on the relationship between smoking and advertising. On any balanced assessment there is no comfort at all for the promoters of this Bill.
One of the more pretentious earlier reviews of evidence was the Smee committee report published by the Department of Health in 1992. After a showy parade of econometric and statistical analysis of 19 published studies, it concluded weakly that a majority showed a positive relationship between advertising and tobacco consumption. The snag was—when one looked deeper—that the studies varied widely in quality and most of them lacked statistical significance. If there were time, I could quote from the Smee report. It states, for example, that where advertising does have an effect on consumption, it is a transitory effect. Consumption responds initially but then falls back unless one keeps on increasing the advertising. A progressive increase in advertising is necessary to sustain a given initial increase in demand.
The weighty conclusion of the prestigious research group, Henley Marketing Dynamics, was bluntly that,
"the analysis undertaken in the Smee report does not justify its findings".
Indeed, Smee himself acknowledged weaknesses in its data, some of which was derived from the Norwegian equivalent of our own Action on Smoking and Health (ASH). Hugh High's devastating evidence, summarised in Table 5, shows that following bans in Iceland, Norway, Finland, Italy and Portugal, introduced between 1971 and 1983, consumption fluctuated, but compared with the decline in countries without bans there was no additional reduction in smoking.
The commonsense conclusion is that the dominant influence on the general decline in smoking which we have witnessed has been the gruesome, and I believe exaggerated, counter-advertising of the health warnings. To the extent that banning advertising simultaneously reduces public exposure to these warnings, a long decline in smoking could slow down or even be reversed. As with fox hunting, I hope that the House will resist an authoritarian Bill which panders to political prejudice and yet would fail in its professed purpose.
4.43 p.m.
Lord Mason of Barnsley: My Lords, I must first declare an interest; I am a pipe and cigar smoker. Indeed, I have smoked a pipe for the past 57 years. I also formed the Lords and Commons pipe club over 20

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years ago. We have about 100 members in both Houses. I am not happy about this Bill but I shall not oppose it. There is a health drive behind it which I appreciate.
I am not a member of FOREST, unlike my noble friend who has just addressed the House, but I do believe in the freedom and the right to enjoy tobacco. Freedom and tolerance towards smoker and anti-smoker should be the creed to follow—it would certainly help to lessen the feelings against each other.
To smoke a cigarette, cigar or a pipe is a person's choice, and whether smoking, drinking alcohol or smoking cannabis or pot, they are fully aware of the risks and, indeed, constantly advised of the dangers to health of pursuing their pleasure. But I stress that there should not be annoyance to others. I also believe that undue pressure is unwarranted. It does seem odd that those who drink alcohol, causing many horrible road deaths, death to themselves, illnesses and disease and a burden on the health service, do not receive the same waves of wrath as the tobacco smoker.
The tobacco smoker feels he is being told and controlled, and to him it is anathema in a democratic society. Tobacco is still a legal product and it has the legal right to be advertised. I know that tobacco companies argue that they are directing their advertisements not at young or potential customers but at the competition between competing brands. Well. be that as it may, the point is that they are being singled out for public and unfair chastisement. Now under this legislation so strictly to control their right to advertise and promote their products, banning their advertising and promotion to this extent is almost the final step to stop smokers being informed of their tobacco choice.
Seventeen million smokers will also feel aggrieved. But my main concern is the Chancellor's policy on tobacco taxation, which has been mentioned already by the noble Viscount, Lord Oxfuird, and the noble Lord, Lord Harris of High Cross. But, first, I note that on 22nd January in another place the Minister, Alan Milburn, said,
"I believe that people have a right to choose to smoke. If that is what they want to do, they have a right to do it".—[Official Report, Commons, 22/1/01; col. 656.]
And then on 1st February my noble friend Lord Whitty in your Lordships' House said,
"It should be recognised that a significant minority of the population still smoke. The interests of that minority should he borne in mind, as well as those of everyone else … we need to take a proportionate approach to this".—[Official Report, 1/2/01: col. 880.]
Well said. There is no vendetta then. Well, why punish the smoker? Why are not these Ministers telling the Chancellor that there are 17 million smokers constantly being punished through his tobacco taxation policy? And where is the proportionate approach?
The Government's policy of constantly increasing taxes on cigarettes is self-defeating and has had quite the opposite effect to what was intended. Smoking is on the increase for the first time in 25 years and I believe that it is the increasing official price of tobacco
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that has brought this about. The tax on legally imported cigarettes is now so ridiculously high that it has created an enormous black market in untaxed smuggled cigarettes costing the Treasury between £2 billion and £3 billion a year. With cut price cigarettes and masses of cheap imports, more young people now find it easier to start smoking.
I know, of course, the measures that have been taken to curb this smuggling—1,000 extra Customs officials and a national network of x-ray scanners. Add that on to the Chancellor's lost revenue and it has still not stopped smuggling. I believe that the Chancellor's policy is wrong. It is expensive; it is an aid to smuggling and the crime that goes with it. It is a smuggler's charter, an inducement to crime, with smuggling gangs operating now in the clubs, the schools and the back streets of our towns. Add that to the cost of the Chancellor's tobacco taxation policy. I also believe that some of these illegal, cheap imported cigarettes have a higher tar content and are therefore more harmful to young smokers. Therefore his policy in that respect is dangerous too.
The Tobacco Manufacturers' Association—I have no connection with it—made it clear in its submission to the Chancellor that the UK tobacco tax is now the highest in the world and has created a situation where smuggling is spiralling out of control, law and order are being undermined, cigarette consumption is increasing and legitimate retailers are going out of business. Yet in spite of those dire warnings the Chancellor still increased the tobacco tax. A packet of Regal king size will now cost £4.28, compared with £1.47 in Spain. One in three smokers is now buying his cigarettes from illegal sources. Some evidence came from cigarette packets found on the terraces of football grounds. For example, last season 41 per cent of packets found at Ipswich after one match were non-duty packets.
The Government estimate that in 1999–2000 total cigarette consumption was around 76 billion of which 13.6 billion—18 per cent—were smuggled. Even by the Chancellor's own reckoning, the measures he has introduced to contain smuggling seemed to be designed to accept that 18 per cent to 20 per cent will be smuggled. And this Bill on advertising and promotion will not stop that.
Finally. I draw the House's attention to an Answer to a Written Question in another place given by the Paymaster General, Dawn Primarolo as recently as 7th March. At col. 229 of the Official Report, she said:
"As part of the 'Tackling Tobacco Smuggling' strategy. Customs are pursuing a target for 2000–01 of holding illicit market penetration to 21 per cent of the UK cigarette market. equating to £2.8 billion in lost revenues. Customs' assessment for the calendar year 2000 suggests that 22 per cent of the UK cigarette market is made up of smuggled cigarettes, equating to £2.9 billion in lost reserves".
What an admission! And how many hospitals could we have built?
I say to the Chancellor and to the Government: stop punishing the smoker. Is it not worth cutting the taxation on tobacco'? It might—I emphasise "might"—prompt a short-term increase in legal

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cigarette smoking but it would help to kill off the illegal trade, the smuggling crooks, crime in our urban districts and, after a little time, as before under the voluntary agreements, I believe that the reduction in smoking would then continue.
4.52 p.m.
Lord Naseby: My Lords, I have been involved in marketing all my life. At one time I confess that I was responsible for some years for the advertising of Senior Service, Park Drive, Hamlet, Old Holborn and a number of other old brands. I have never smoked in my life.
Like other noble Lords, I accept the medical evidence although I note in passing that the incidence of lung cancer rises steeply with age. According to Professor Thatcher of the Christie Hospital NHS Trust, Manchester, 82 per cent of patients are now over 65 and 47 per cent—that is, nearly half the patients—are over 75; so at least they have passed their three score years and ten. So perhaps the evidence is not quite as strong as everyone says traditionally.
There is no purity of principle as regards the Bill. It is just perceived to be politically correct. No one on either side of the Chamber has the guts to ban cigarettes. No government ever had the guts to ban smoking. We know that this Government are not good at coping with challenges.
The noble Lord, Lord Mason, told us about illegal smuggling. I do not need to add to what he said. The situation is not being coped with. We are flooded by cheap cigarettes. Why, therefore, do the Government persist in ignoring the importance of price? However, I take issue with the noble Lord on this matter. All the evidence in relation to smoking is that the lower the price of cigarettes, the greater the consumption. Even the Chancellor in his latest Budget did not increase the price of cigarettes by a great deal. I do not think that the Bill will work. However, if it were to succeed, the resources that the tobacco manufacturers spend on promotion will now be available to reduce the price of cigarettes. Your Lordships will know that there is fair latitude from the profit margins of cigarette companies to reduce the price of cigarettes.
If one wants further evidence, let us consider eastern Europe. Cigarettes are cheap in eastern Europe and consumption is high. If all promotion or communication is removed, the resources that would have gone into that factor will now go into reducing the price, and consumption will increase.
It is clear that the Bill will not work. It will not reduce consumption. On Clause 2, the Explanatory Notes state:
"It is not intended that the public at large, journalists etc should be prevented from commenting on tobacco products or that the representation of smoking and tobacco products by those engaged in creative or artistic pursuits (actors, painters, products etc) should be prohibited".
So lifestyle promotion will continue. Only commercial brand communication is to be constrained.
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The Explanatory Notes continue:
"Subsection (4) exempts persons who do not carry on business in the United Kingdom".
Why are we supporting overseas companies? There seems to be a huge hole there.
The noble Lord, Lord Dubs, commented on in-flight magazines. UK airlines do not carry only passengers from the UK. I think that British Airways would be somewhat offended if it were told that the majority of its passengers were UK citizens. They are not. Why should it be constrained?
My noble friend Lord Tebbit commented on Clause 7. I do not believe that a single Member of this House can allow Clause 7 to be agreed to. It gives the Secretary of State an all-enveloping power: that because there may be some developments in technology he or she may have the right to introduce an amendment to the Bill without debate.
Clause 9 refers to free samples of allied products. The Minister referred to sunglasses, umbrellas, windcheaters and so on. The Explanatory Notes state:
"For example, branded clothing might be sold for two thirds or more off the usual price".
What is the usual price? Is it the Gucci price? Is it the Marks & Spencer price? Is it the Asda price? Is it the market trader's price? What happens if they are last year's goods? Can one not have sale prices? How many noble Lords have visited retail parks where prices are cut to the margins? The clause will not work. The poor trading standards officer has to assess whether the price is right or wrong. It is an impossible job. The power will not work.
I know a little about brand-sharing. I feel somewhat sorry for Branson. Presumably he cannot have Virgin cigarettes because he already has an airline and a host of other dimensions. But he will not be allowed to have Virgin cigarettes because they would share the brand name. The provision will remove the whole of the own-label business. No supermarket can have an own-label cigarette. Sainsbury, Asda, Tesco and so on will be denied it. That is an interference with their trade.
We know that attempts at a passing-off action fail. The Government must have that knowledge—but perhaps not the Department of Health. The DTI certainly has such knowledge.
With regard to enforcement, I feel extraordinarily sorry for the trading standards officers. In Northamptonshire a few years ago, one saw the genuine pressure under which they worked regarding the problems of counterfeit and unsafe products. Are we really saying that, as a priority, they must check the displays of the corner tobacconists and newsagents to ensure that they are not offending the provisions of the Bill?
The Bill is riddled with dangerous precedents. I hope that the Minister will take seriously the words of the noble Lord, Lord Harris, and his experience of advertising, which I totally concur with from my own experience. The Bill interferes in the legitimate communication between a business and its known customers. It gives unfair advantage to foreign

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companies. It flies in the face of all economic experience. Clause 7 is totally unacceptable. To ban the promotion and communication by any means of a product that is legally manufactured, sold and bought is totally wrong and unprecedented in peacetime.
5 p.m.
Baroness Gibson of Market Rasen: My Lords, I begin by expressing my support for the aims of the Bill. As my noble friend Lord Tomlinson said, it is another election manifesto promise that is being kept. I particularly welcome the ending of tobacco advertising in sport. I shall be pleased to attend a football match or watch it on television—hopefully a match that involves Ipswich Town, whom I have followed for many years—and no longer have to see advertisements for smoking, which are currently difficult to avoid.
I recognise that since 1995 there has been a voluntary agreement relating to advertising and tobacco promotion, which the Tobacco Manufacturers' Association has tried to monitor. However, there have been a number of examples of adverts being placed close to schools or hospitals. Although some of them have eventually been removed, they can encourage smoking by children and by others who are already ill, however briefly they appear. I therefore believe that the Bill is needed.
I shall raise two particular issues on which the Bill may cause consequential problems. The first is a question of employment. I have spoken before in your Lordships' House about smoking and declared an interest as a former senior official of the Manufacturing, Science and Finance Union, of which the tobacco workers' section is a proud part. I am aware that the Bill may not directly affect employment, but presumably tobacco companies do not spend millions of pounds on advertising for fun. I understood from them last week that they believe that advertisements promote tobacco and smoking. If so, it surely follows that lack of advertisements may deter smoking, which in turn will threaten the jobs of those in the tobacco industry.
Additionally, such extra regulation may make tobacco manufacturers think twice about continuing their business in the UK. I have already been told personally by one large tobacco company that it cannot diversify any more than it has done already and that in any case it believes that there is an anti-tobacco attitude in the UK, which means that future investment must be made abroad. One of the companies that provides filters for cigarettes has told me that its machinery has been tailor-made for such filters and is no use for manufacturing other products. If the machinery cannot be used to make filters, it will have to be scrapped, the factory closed and the workforce dispensed with.
I do not know whether those companies are bluffing, but if they are not, jobs would appear to be under threat. Under those circumstances, I ask my noble friend the Minister and other Ministers, when
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dealing with issues relating to tobacco manufacture, to remember the need for alternative forms of employment for any workers threatened.
Thanks to efforts of the tobacco workers' union over the years, we are talking not about poorly paid, part-time jobs, but about skilled, well paid posts for men and women. Just as I have argued in the past for alternative employment for miners, steelworkers and those in the rural communities, I argue that those working in the tobacco industry—many of whom, ironically, are non-smokers—have a right to the same consideration.
My second worry has already been touched on by a number of noble Lords. It concerns the possibility of increased smuggling of cigarettes into this country. It is very helpful that the Government are encouraging smokers to stop smoking by the use of patches and other methods. I greatly welcome that. However, some people will continue to smoke despite those incentives being placed in their way. It often follows that the cheaper the cigarette, the more they will smoke. Despite increased surveillance, we know that criminal elements in other countries are targeting the UK as a country into which cigarettes can be smuggled. Those smuggled cigarettes may well be stronger than some and may come from countries with little or no health protection provision relating to tobacco products.
Last year the UK manufacturers claimed to control 93 per cent of the UK cigarette market, but they now fear that that percentage may decrease rapidly. Already a number of previously unheard of cigarette brands and counterfeit produce of dubious quality are smuggled into the UK market. I understand that they come from as far afield as China. I also understand that smuggled cigarettes are being sold from ice-cream vans, thus targeting children and young people.
Clause 2(4) says:
"It is not an offence … for a person who does not carry on a business in the United Kingdom to publish or cause to be published a tobacco advertisement by means of a website which is accessed in the United Kingdom".
Does that mean that the world-wide web can be used for the advertisement of cheaper and smuggled cigarettes? Can the sales outlets from which they can be obtained also be advertised? I hope that my noble friend the Minister will be able to reassure me on those points.
I look forward to my noble friend's responses on those two important issues of jobs and the smuggling of tobacco products. I reiterate that overall I am in favour of the Bill.
5.7 p.m.
The Earl of Liverpool: My Lords, the first thing that strikes me about the Bill is that it is by any standards a draconian measure. Tobacco is a recognised legal product, the manufacture and distribution of which employs around 60,000 people in this country and, it is estimated, more than 100 million world-wide.
The Bill would introduce a comprehensive ban on tobacco advertising and sponsorship by any company in the sector going about its legal business and trying

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to protect its market share. That is a drastic step. What is the reasoning for it? The Minister has said that it is hoped that it will reduce consumption by 2.5 per cent. He prayed in aid the Smee report, but there is other empirical evidence on the subject and even the Smee report cannot prove that that 2.5 per cent reduction would be achieved. The noble Lord, Lord Harris of High Cross, quoted the 1996 KPMG report. At the risk of testing your Lordships' patience, I shall repeat its conclusion. It said:
"There is overwhelming evidence to support the proposition that advertising bans on tobacco do not reduce tobacco consumption".
The 1990 report by the Office of Population Censuses and Surveys found that advertising had no significant influence on why children start smoking. The Macdonald surveys of 1993 came to the same conclusion, stating:
"There is no evidence in any of the studies to suggest that if advertising were banned it would make the least difference to the propensity of children to smoke".
Therefore, noble Lords may take their pick, but the Smee report is by no means the only report to which we should pay attention.
Perhaps there is another reason why the Government are pressing ahead with this legislation. Certainly it was in their manifesto, but my personal view is that it has more to do with demonstrating to the country at large that the nanny state under new Labour is very much alive and well. Whatever the reasons, I believe that the Government are misguided.
Furthermore, I believe that their tobacco policy is confused and contradictory. On the one hand, they have committed increased resources to education and smoking-cessation programmes, which are to he commended; on the other hand, they have pursued an excessive tobacco tax policy which has had the predicted perverse consequence of encouraging smuggling on a massive scale. Many noble Lords have already referred to that.
The resultant countrywide availability of low-price, black-market products has led inevitably to increased total consumption. Since this Government came to power in 1997, it is estimated, as has already been stated by my noble friend Lord Oxfuird, that UK tobacco consumption has increased by 6.5 per cent. That follows a period of 25 years of persistent decline.
It must be said that the one thing that this Bill will not do is reduce the upward trend of tobacco consumption that we have seen since the Government took office. The reason is that, without brand advertising or promotion, the prime means at the disposal of manufacturers will be to compete on price. It does not take a genius to work out that, with smuggling unabated and a general downward pressure on UK retail prices, consumption will continue to rise.
As we have already been told, the revenue lost to the Exchequer as a result of the excessive tax increases imposed since 1997 totals almost £9 billion. That is an enormous sum of money. During the same period, consumption has increased, and that has had three
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major adverse and unwelcome effects on the country. The first is that children have gained wider and easier access to tobacco products through indiscriminate selling by illicit traders.
The second effect is the increased level of criminality in the population. It is estimated that 5 million people in the UK are now involved in smuggling, or illicitly selling or buying tobacco on the black market. This is big business for the hardened criminals, who employ tactics of intimidation and violence.
Thirdly, thousands of legitimate retail businesses have been seriously affected financially. Some have even been put out of business. Something must be seriously wrong when one can buy a packet of cigarettes on the black market for £2.50 while the retail price, as we have already heard, is £4.33 or thereabouts. That represents a saving of 42 per cent, or almost £2, per packet. Therefore, of course people will be tempted to buy smuggled products. Indeed, even the Paymaster General admits that in the year 2000 22 per cent of all cigarettes smoked in this country were smuggled. That equates to 18 billion smuggled cigarettes—quite a heady figure—and a loss to the Revenue, again, as we have already heard, of almost £3 billion a year.
In my view, by far the worst smuggling statistic is in relation to the hand-rolling tobacco sector. It is reliably estimated that 80 per cent of all hand-rolling tobacco in this country is non-UK duty paid. That is a staggering figure. It is very difficult to try to rationalise that the ban on advertising and sponsorship proposed in the Bill will have any effect on reducing that figure or, indeed, overall consumption.
If a manifesto pledge is found to be misguided because of the consequences that its implementation would have, I believe that other more appropriate means of achieving the Government's objective should be found. It is possible that the Government have come to the same conclusion. The timing of the introduction of this Bill into your Lordships' House means that it will be almost impossible for it to pass into law if an election is held in May this year.
I want to touch briefly on the health implications. It is undoubtedly true that smoking cannot be regarded as good for one's health. One of the reasons cited for the introduction of this Bill is that it is believed that it will reduce consumption by 2.5 per cent. Quite apart from the fact that such a reduction in consumption cannot he convincingly argued against the facts, that says something very serious about the interference in our lives by this Government and about their lack of consistency.
If noble Lords are considering drugs that damage health, they should take, as an example, drink. It is, if one likes, another legal drug. Let us consider the burden that patients hospitalised as a result of excessive consumption has on the National Health Service. The Royal College of Physicians estimates that drink-related health problems could account for up to 12 per cent of total NHS spending—that is, approximately £3 billion a year. Will the next step of this Government be to introduce a similar ban on

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drink advertising and sponsorship, saying confidently that that will free up so many thousand National Health Service hospital beds? If they do, in my view the case will be equally unproven and equally unfair.
Where does that sort of approach end? Why not ban car advertising? I am not being terribly serious in asking that question but, after all, cars kill children and cause many thousands of deaths and injuries every year. We are beginning to witness an increasingly regulated state interventionist mindset which runs counter to what this Government profess to aspire to; namely, joined-up thinking, less legislative burden and the reduction of red tape.
In the context of legislative burden and red tape, I want to touch on Clause 7, to which my noble friend Lord Tebbit and others—sthe noble Lord, Lord Naseby, in particular—referred. I regard it as a Henry VIII clause. I have been in this House long enough to know that the one thing that can be guaranteed to antagonise your Lordships and arouse suspicion is the insertion into a Bill of a Henry VIII clause. Therefore, I shall strongly oppose that clause in Committee.
As currently drafted, the Bill gives incredibly wide-ranging powers to the Secretary of State. Clause 7 is one example; there are others. The power which it confers is aimed at Internet and electronic promotion of tobacco. It would, I believe, be wholly wrong to allow such powers to stay in the Bill. This is a very complicated area which will require proper parliamentary scrutiny if for no other reason than to avoid the law of unexpected consequences. The electronic aspect and the attempt to cover that in the Bill are, frankly, a minefield.
Quite apart from that, but no less serious, are the powers of entry into premises, as set out in Clause 14. That clause gives an enforcement authority rights to enter premises by force. Such premises could include private homes where part of the home is used as an office or where the occupant or company is under suspicion.
Then we come to the absurd aspect under Clause 4, which states that apparently no offence is committed if tobacco advertising appears in a magazine whose principal market is not the United Kingdom and which has been published on the Internet. This is the Alice in Wonderland aspect of the Bill. We all know that the Internet knows no international boundaries, as is graphically illustrated by the fact that another way of describing it is "the world-wide web". Therefore, it will be very difficult, or even impossible, to say where the principal market is aimed.
There are so many loose ends in the Bill. To what extent this Government can legislate on such matters in Scotland, as they set out to do in Clause 13, is just one more matter that I should like to question—never mind the question of whether this legislation would fall outside the Treaty of Rome and EC legislation on free trade practices. In his opening remarks, the Minister made a point of saying that European Council Directive 98/43/EC is the very legislation on which this Bill is based. However, it was annulled on 5th October 2000 following a legal challenge.
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The Bill is misconceived and presents a very dangerous precedent. It is unfair for an industry that is going about its lawful and legal business to be discriminated against in this way. The voluntary agreements that are in place between the industry and government have worked well over the years and have, until the recent draconian tax increases, achieved a year-on-year reduction in consumption.
If the Government are serious about their objective, they should dispense with the Bill, reduce excise duty to more sensible levels and continue to have a dialogue with the industry through voluntary agreements.
5.20 p.m.
Lord Monson: My Lords, perhaps I should start by mentioning that I am a supporter of FOREST—wholly unpaid, of course—although I am not sure that that is relevant to the Bill, which relates to an advertising ban, not to a smoking ban.
No government in a free society should create yet another criminal offence or extend the scope of censorship—both of which the Bill will do—without a very good excuse. I submit that in this case the Government have not got that justification. In this country, as in all democratic countries, smoking has always been a perfectly legal activity. It has normally been taxed quite heavily for health, social and revenue reasons, in the same way as alcohol is heavily taxed. However, fiscal "dissuasion", so to speak, is one thing, but criminalisation is a very different matter. The latter is particularly inappropriate with regard to tobacco advertising because it is clear that no adult will be induced to smoke more or to take up smoking for the first time in consequence of seeing an advertisement. Indeed, with regard to adults, social pressures nowadays are all in the other direction, especially in Britain and the United States.
The Government may argue with reason—they have not yet advanced this argument—that libertarian principles sometimes have to be subordinated to the protection of minors and that that is their main aim in the Bill. Were they to do so, I should suggest that that argument would carry more weight if the Government had not recently devoted massive efforts, including the use—or possible misuse—of the Parliament Act, to ensure that 16 and 17 year-old boys and girls can legally be subjected to a practice that is far more harmful to their health than smoking a cigarette will ever be. The noble Lord, Lord Tebbit, made a point along the same lines.
It is not advertising that tempts young people into smoking, as the Independent said in an excellent leading article on 9th December last year, an article mentioned by my noble friend Lord Harris of High Cross. "Epater la bourgeoisie"; "Thumb your nose at your elders"; "Taste the forbidden fruit"; such have always been the natural inclinations of young people throughout the western world. If smoking were made compulsory, we could be certain that the young would give it up as soon as they could.
One might add to the inducements that young people face to take up smoking the example set in southern Europe, where smoking is still chic,

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particularly among women. Are we going to ban young people from travelling to Italy or Spain? Although I am afraid that I have only rarely seen the television soaps that were mentioned by the noble Lord, Lord Tebbit, what should we do about old films that are shown on television and in which the handsome hero and ravishing heroine play every scene with cigarettes firmly clamped between their lips? Will the BBC and ITV be ordered to censor those films in the same way in which politically correct zealots in the United States have managed to airbrush out of photographs of Franklin Delano Roosevelt the cigarette that was permanently in his hand?
One suspects that the Government and the antismoking lobby would like tobacconists to resemble the betting shops of old. Noble Lords will remember that previous governments tried to make them as austere and forbidding as possible in order to discourage people from gambling. That did not work, and now betting shop proprietors have been allowed to brighten up their premises and make them more consumer friendly.
One also reads today that the drive against cannabis is being relaxed in practice if not in law. So much for consistency!
How will the proposed draconian restrictions help anyone? The Government make half-hearted murmurs about the prospect of a 2.5 per cent reduction in smoking. As several noble Lords have pointed out, that figure has been plucked out of thin air and is not supported by any evidence; it is simply a "guesstimate". Despite the comments of my noble friend Lord Walton of Detchant, the evidence regarding Norway is ambiguous. Although tobacco advertising has been banned for a long time, consumption has risen by 41 per cent over 20 years. I do not know whether that is to do with the prosperity that resulted from the oil boom, but it is a fact. Moreover, consumption in the United Kingdom, the Republic of Ireland, the Netherlands, Belgium and Luxembourg—there is a ban in none of those countries—has fallen more sharply than it has done in many countries in which a ban is in place.
Smuggling has not been taken into account. Throughout history, punitively high taxes have led to smuggling. Smuggling is viable when distances are short, as they are between France and Britain, and when population densities are high, as they are in this country: it would not be particularly viable to smuggle to Norway. Since the price of smuggled cigarettes is lower overall than highly taxed cigarettes, consumption will increase, as was pointed out by the noble Earl, Lord Liverpool, the noble Viscount, Lord Oxfuird, and the noble Lord, Lord Naseby.
What does an advertising ban mean? It means that manufacturers will be able to compete not on quality but only on price. Unless I have misunderstood the Bill and the Minister's opening speech, manufacturers will not be able effectively to inform the consumer that brand A contains less tar and nicotine than brand B; they will not be able to encourage customers to experiment (for example) with cigarettes that are made
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from air-dried tobacco, which contains less tar than flue-dried tobacco; and they will not be able to encourage people to experiment with cigars and cigarillos, both of which, I understand, contain less tar than cigarettes, or even with snuff, the advertising of which is inexplicably going to be banned although medical opinion deems it to be virtually harmless.
Quality—or at least the possibility of quality—will be replaced by cheaper quantity, whether legal or illegal. I have smoked enough awful state-monopoly tobacco in post-World War II Europe to know what I am talking about.
Such an illiberal Bill obviously needs much detailed scrutiny in Committee and probably during its later stages as well. Theoretically, there are 13 months of this Parliament left to run. There can clearly be no question of the Opposition agreeing to curtail debate and to agree to the Bill virtually on the nod should the Government decide to call an election 12 months earlier than they are obliged to do.
5.28 p.m.
Lord Hardy of Wath: My Lords, I begin by declaring an interest. I am a smoker and member of the club to which noble Lords have referred. I have enjoyed its hospitality, although I have no financial interest. From time to time I have also enjoyed hospitality from the establishment that came into my constituency at a time when unemployment had reached unimaginable heights. It created more jobs than we had seen for some years previously—and, indeed, subsequently. That establishment held the packaging material and tobacco of a major company. I did not and do not smoke the products of that company.
That reminded me of the concerns about the protection of brands. The tobacco industry says that it is keen to advertise in order to protect brands. If advertising is prevented, especially if the illegally imported trade is to continue, the danger of a reduction in British production in favour of overseas production will not do this country very much good. It is for that reason that I hope the Minister will pay particular attention to that argument.
In relation to smuggling, I take the historic view that the smuggler is popular. The smugglers in Napoleonic times were among the most popular people in the country, although they were providing considerable assistance to the French economy. Our concern may be rather more widely distributed throughout Europe if we consider the attitude of those countries within the EU which grow tobacco.
My anxiety relates to whether the statistical base of the Government's argument is correct. My noble friend quite properly referred to the World Bank and the research in that regard. He suggested that it was almost certainly correct. I do not disagree. My concern is that this Bill may well encourage and provide ammunition for the maintenance of the assault on smokers which those of us who smoke have witnessed with increasing frequency in recent years.
I have been smoking since my early teens. I was smoking when I was a schoolmaster—I referred to this in a recent debate in the House—and was left with a

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class of over 40 children and no classroom. I had decided to stop smoking at that time but found it increasingly necessary mid-morning and midafternoon to have a quick cigarette in the staff room. I could not do that now and therefore would probably have been subject to the term "stress", which I do not believe we encountered before 1970. I would have been able to sue my local authority for several hundred thousand pounds and regret, perhaps, that I was not a policeman in London.
Those of us who smoke fear that we will be increasingly badly treated. For example, after a great deal of effort we persuaded the last government to accept the scheme for the compensation of miners with bronchitis and emphysema. But they included a rather nasty little condition. If a miner was seen to have been a smoker, then the benefit he could receive was significantly reduced. A miner who was born in the middle of the 1920s and started working down the pit in the middle or late 1930s, at which time he probably started smoking, would have been smoking for at least a score of years before there was any clear medical evidence that it was harmful to him. Yet now we penalise him for starting to smoke in the 1930s. It suggests that the last government were as anti-smoker as are the present government.
My other anxiety is that this Bill will reinforce those who are opposed to smoking per se, and who often use the passive smoking argument quite violently. The noble Lord, Lord Walton, was right to say that although the medical evidence of the harm caused by direct smoking is clear, neither the Government nor anyone else have been clear about the dangers of passive smoking. For example, I understand the World Health Organisation sponsored significant research into passive smoking carried out by seven centres in 12 countries and found no clear evidence. The department has not been clear in that regard and was not clear under the last government.
Let me give an illustration. In 1995–96 a number of my constituents were complaining to me about a ban imposed on smoking by the Rotherham Hospital Trust. It told the employees that there would be no smoking within the hospital and outside it, including the car park. Some of my constituents—one a nursing sister who had not had a day off in 25 years—came to me to say they wished to have a smoking room. I wrote to the trust and the trust replied, saying, "It is not our decision. The Minister instructed us to do this". So I wrote to the Minister. In reply the Minister sent me a copy of the advice he had given to all hospital trusts. It recommended that the National Health Service should discourage smoking but that members of staff should have a smoking room.
When I received that information from the Minister, I wrote to the acting chief executive and asked for an explanation, since he had clearly misinformed me. I asked the trust to reconsider, since 512 members of its staff — some who smoked and some who did not—had asked for a smoking room, in accordance with the advice given by the Minister.
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That was in early May 1995. I had not received a letter in reply in June, July or August, though I had sent reminders. So in early September when we had our annual meeting with the trust, the chairman said, "Gentlemen, I will give you the agenda". I said, "No, I will tell you what the agenda is. Item one, my correspondence and your failure to reply". I immediately received an apology and an assurance that it would be considered. In October I received a letter saying the trust was confirming its decision. I wrote again. In the end I wrote to Madam Speaker—now the noble Baroness, Lady Boothroyd—who permitted a debate on 17th January 1996.
Mr. Horam was the Minister who replied to that debate. I pointed out my experience in the case in some detail. I suggested that the car park ban was a bit odd, because people might wish to go to their car in anxiety, stress or tension. Hospitals are not always the happiest places. The Minister seemed to have been informed that virtually everyone in the whole area apart from myself was unanimously and wholeheartedly in favour of the ban. However, the trust let me know that it would not apply the ban in the car park.
I retired from the Commons in 1997 and just after the election I went to the hospital to visit a friend. Noble Lords can guess what I saw in the car park: prohibition of smoking. There was no justification for that on the basis of ministerial instruction, yet the last government allowed that degree of excessive nannyism—a phrase we have heard on several occasions—and the ban still exists. Yet I have not seen any convincing evidence that passive smoking is as harmful as some of the smoke-finder self-appointed generals seem to suggest.
We should not smoke where we ought not to do so. We should not smoke to encourage young people. My sons do not smoke and I have never in my life, certainly as a schoolmaster for a long time, encouraged young people to smoke. But the difficulty is, as my noble friend Lord Mason said, that people will continue to smoke as long as we have a structure encouraging smuggling and where the smuggler is seen as a hero. Until that issue is addressed we shall see more crime—a crime of growing scale at the present time which has serious implications for society—which makes me uneasy.
I accept that the Bill is a manifesto commitment. I accept that the problem of smoking will continue to require consideration by the Government. I believe that if the tobacco industry is wise, it will continue to try to produce less harmful products. But if it succeeds. it should have the right to advertise them. I trust that the Government will give serious thought to those points, not least to the need to reduce the tensions and hostility between those who hate smokers and the freedom of smokers to smoke in a free society in a responsible manner. I hope also that the Minister will pay particular attention to the need to avoid yet another tranche of job losses in the manufacturing sector.
5.39 p.m.
The Earl of Northesk: My Lords, I begin by making the point that, in case any of your Lordships had not noticed, I am an inveterate smoker. I am also a member of the Lords and Commons Pipe and Cigar Smokers' Club presided over so ably by the noble Lord, Lord Mason. Against that background I willingly concede that significant health and public policy issues need to be addressed in the context of smoking, tobacco products and their promotion.
None the less, I find the Bill deeply disturbing. One of my major concerns is that there is a sense that the Bill is imbued with an air of fanaticism. However worthy and desirable its objectives, it is weighted firmly to one side of the argument. That makes it all the more important that the justifications which the Government advance for the Bill are properly tested. With that in mind I would ask the Minister if the Government sincerely believe that the advertising of tobacco has been a major contributory factor—many other noble Lords have referred to this point—in the increase in tobacco consumption since 1997 after some 25 years of decline.
I would also ask the Minister to what extent the drafting of the Bill has been informed by consultation and discussions with the tobacco industry. That is important because—I echo the sentiments of my noble friend Lord Geddes—there is an intellectual, if not ethical, inconsistency at the heart of the Bill.
Writing recently in the Daily Telegraph, Tom Utley posed the following questions:
"What is the purpose of the Government's policy on tobacco? Is it to discourage the British people from smoking? Or is it to raise as much money as possible from smokers, by way of taxes and duty on tobacco?",
and,
"if the Government were seriously determined to stamp out smoking, why does it not seek to ban the sale of tobacco?".
Like the noble Lord, Lord Dubs, the Government will argue that it is not their intention to stamp out smoking. That begs the question of how appropriate it is that a perfectly legal product—Ministers freely concede that point—should be subject to a comprehensive, unilateral and in many ways arbitrary measure, one of the major effects of which will be to constrain the industry concerned from exercising legitimate commercial freedoms. As Tom Utley points out,
"The trouble with this government is that it cannot decide whether its purpose is to discourage smoking or to maximise the tax yield from tobacco. It is trying to do a bit of each—and in the process it is failing in both aims".
Far from resolving that dichotomy, the Bill will entrench it.
That polarisation of policy objectives is mirrored in the Bill's provisions for the Internet. We have become inured to the oft-repeated mantra that the Government are aiming to make the UK the best and safest place in the world for e-commerce. That is all
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good and well. But measures such as IR35 and the Regulation of Investigatory Powers Act work against the grain of that ambition. Far from promoting or facilitating the development of e-commerce in the UK, they act as constraints and disincentives. So it is with the Bill which, in terms, reveals a scant understanding of the way in which the Internet works.
The point at issue here is to be found in the drafting at Clause 5(5) which refers to:
"a tobacco advertisement which is published or caused to be published by electronic means by an Internet service provider".
The difficulty is that in no sense are ISPs publishers. Rather, they are the virtual equivalent of the Royal Mail. In terms, the effect of the Bill is to create the prospect of postmen being statutorily empowered to steam open personal mail with a view to censoring its content. That analogy of ISPs as postmen is well established. Thus, notwithstanding the insistence of the Minister that the Bill complies with the e-commerce directive, Article 12 of that measure defines an ISP as a "mere conduit" of information and states:
"Member states shall ensure that the ISP is not liable for the information transmitted on condition that the provider:

(a) does not initiate the transmission;

(b) does not select the receiver of the transmission;

(c) does not select or modify the information contained in the transmission".

In the same vein, the Defamation Act 1996 states:
"A person shall not be considered the author, editor or publisher of a statement if he is only involved
(c) in processing, making copies of, distributing or selling any electronic medium in or on which the statement is recorded".
Self-evidently, the drafting of Clause 5(5) completely contradicts that, yet the effect of the Bill is to make ISPs liable for third-party content on their servers. At the same time, as my noble friend Lord Lucas pointed out, they are required to comply with the terms of the Regulation of Investigatory Powers Act. which provides that unwarranted interception of material is illegal. Moreover, in so far as third-party content can be defined as personal data, the provisions of the Data Protection Act also apply.
In other words, ISPs are operating under a growing burden of regulations which increasingly pulls in conflicting directions. The potential consequence of that should not be underestimated. It could be the straw that breaks the camel's back. ISPs will no doubt give serious consideration to the desirability of migrating to less burdensome regulatory regimes, should the Bill be enacted in its current form. That would leave in tatters the Government's ambition to make the UK the best place in the world for e-commerce.
I conclude with one small thought. The British Codes of Advertising and Sales Promotion, administered by the Advertising Standards Authority

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require that, among many other restrictions, advertisements should:
"be legal, decent, honest and truthful".
As things stand, that applies as much to the tobacco industry as to any other. Yet, since January last year, the codes have not applied to any advertisement whose,
"principal function is to influence voters in local, regional, national or international elections or referendums".
Given the nature of the Bill before us, what are we to make of the fact that the Government are comfortable with the concept that political parties do not have to be legal, decent, honest and truthful in their advertising? Is it too churlish to suppose that there is a slight whiff here of pots and kettles?
5.46 p.m.
Lord Faulkner of Worcester: My Lords, I start by declaring an unpaid interest as a patron of the Roy Castle Lung Cancer Foundation. Unlike the previous four speakers, I wish to give complete and unreserved support to the Bill. I do so because it is a measure which will make an important contribution to public health and saving lives. As we have heard from the Minister, it may save as many as 3,000 lives a year; the equivalent of the number who are killed each year on our roads. But even if the number is not as great as that, I would agree with the comments of the health spokesman for the Liberal Democrats in another place, who stated that even a small decrease in smoking that might result from an advertising and promotion ban would be worthwhile. He said that if only a few lives were saved or a few families were spared the misery of seeing one of their loved ones die a horrible, lingering death, it would be worthwhile. If people avoided having to undergo expensive and particularly nasty treatments, and if that resulted in only a small saving to the National Health Service, it would be worthwhile.
In particular, I welcome the fact that the Bill for the elimination of tobacco advertising and sponsorship should have a direct result on the number of children and young people who start to smoke. I am aware that the apologists for the tobacco industry outside this House and, from what we have heard today a few in it as well, who oppose the Bill claim that all advertising and sponsorship does is to promote brand loyalty and encourage smokers to switch from one brand to another.
We heard that argument, in particular, from the noble Lord, Lord Harris of High Cross. He claimed—I am sure the noble Lord will correct me if I have his argument wrong—that cigarette advertising was analogous to the advertising of soap powder. He said that it does not increase consumption; and that all it does is to increase brand awareness. The noble Lord nods in agreement. There is one big difference. Soap powder does not kill 120,000 customers per year. Therefore, soap manufacturers do not need to replace that number of customers each year with new ones. Because tobacco kills, the manufacturers of that product need to attract new customers. If noble LordS
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have any doubt about that, I suggest that they look at what the Health Select Committee in another place found when carrying out its investigation into the conduct of the UK tobacco industry. The Committee obtained, properly and legitimately, the internal working papers of the five advertising agencies retained by the tobacco companies. Those papers filled 16 large boxes of documents. They reveal a shocking story of deceit, a cavalier disregard for people's health, especially the young, the poor and the vulnerable, and a determination to get round the restrictions.
The advertising agencies make no secret of the fact that their campaigns are intended to encourage people to start and continue smoking, especially young people. They aim to enhance the social acceptability of smoking; to increase per capita consumption; to recruit new smokers and to discourage existing ones from giving up.
They know that children are more aware of tobacco advertising and influenced by it than are adults Earlier this month, the British Medical Journal published the results of a study which showed that out of a sample of 629 young people aged 15 and 16, around 95 per cent were aware of tobacco advertising and all of them had seen some form of advertising at the point of sale.
The industry is obviously aware that the general advertising ban is coming, but it is hoping that there will be exemptions which allow point-of-sale brand advertising, particularly in convenience stores. An article in The Grocer of 3rd March quotes the managing director of a leading Scottish chain saying that the tobacco companies
"have realised the last place they will be able to advertise in the UK will be in the convenience stores. Every day I get a phone call. They offer all sorts of things".
That can include a complete store re-fit, provided that retailers meet their criteria. I hope that my noble friend will be able to reassure us that the ban on tobacco advertising can be extended to point-of-sale material in shops which are used predominantly by children.
Children do not buy the cheapest brands. In 1995. the BMA reported that 61 per cent of children who smoke, smoke Benson & Hedges, the most heavily advertised brand. In Scotland, according to research by the University of Strathclyde, the children are smoking Lambert & Butler, again, a product which is extensively promoted.
Sponsorship of glamorous sports provides another way for the tobacco industry to make an impact on the youth market. The Lancet published research in 1997 which showed that boys are nearly twice as likely to become regular smokers if they are motor racing fans. University researchers at Strathclyde have shown that children associate Marlboro with "fast cars and excitement".
Sponsorship is the continuation of tobacco advertising by other means, including through the BBC. Embassy snooker achieved 376 hours of television coverage and cumulative viewers of 385 million in the 1996–97 season.

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Some sports have resisted tobacco money, notably association football and the Olympics. I should be most surprised if my noble friend Lady Gibson saw any tobacco advertising at Ipswich. I am not aware of any way of advertising tobacco in football. However, many other sports, such as cricket, rugby and snooker, have offered a willing vehicle for promoting tobacco. Sport, with its associations with action and youth, offers excellent images and role models to the tobacco industry.
That is especially important in recruiting young smokers; a process of exciting experimentation eventually consolidated by addiction. That approach is described in a tobacco industry internal document as follows:
"A cigarette for the beginner is a symbolic act. I am no longer my mother's child, I'm tough, I am an adventurer, I'm not square. As the force of psychological symbolism subsides, the pharmacological effect takes over to sustain the habit".
That is taken from the speaking notes of Philip Morris's, vice-president for research and development delivered at a company board meeting and revealed under disclosure rules at a US court hearing.
When the Indian associate of the British American Tobacco group sponsored the Indian World Cup cricket team in 1996 with its Wills brand, a survey showed that smoking among Indian teenagers increased five-fold. There was also a marked increase in false perceptions such as, "You become a better cricketer if you smoke Wills", and "Teams with more Wills smokers will fare better". Contrary to the widely held perception among school children, the Indian cricket team had no smokers at all.
I hope that the Government will keep a close eye on everything that the tobacco companies get up to. Philip Morris, for example, provide Ferrari with £45 million a year and it is looking for ways to divert its advertising and sponsorship budgets into new ways of dodging restrictions. Unless it is stopped, we will see more brand stretching—the creation and advertising of spin-off products such as Marlboro clothing—all used to promote tobacco, particularly in the youth market.
We have heard a certain amount in the debate about tobacco smuggling. I wonder how many of your Lordships saw in the Independent on Sunday a long article headed, "Tobacco giants traded with drug barons". I shall quote only a short extract from it.
"Two of the world's biggest tobacco manufacturers knowingly sold cigarettes worth billions of pounds to Latin American drug barons and to a smuggling ring based in Britain. Court papers lodged in New York claim that Philip Morris and R J Reynolds had 'a scheme to smuggle cigarettes on a worldwide basis'…The two tobacco corporations also set up lobbying groups to further maximise their profits by demanding tax cuts because the smuggling was the result of unreasonably high cigarette duties".
How strange it is that we have heard that argument on a number of occasions today. The article continues,
"The two companies 'control, direct, encourage, support, promote and facilitate the smuggling of cigarettes into the European Community'…They make arrangements for smugglers to pay for their purchases through Swiss bank accounts".
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And so it goes on. The companies are facing legal action brought by the EU Commission for an estimated £3 billion lost in taxes over 10 years. If they lose, they could be forced to pay damages and fines totalling £12 billion. When we talk about smuggling, we ought to be aware where it starts.
Furthermore, I wonder whether my noble friend saw the article in the Financial Times on 20th March about a
"second wave of even more devious marketing techniques".
The article states:
"In the US as part of an agreement with the federal authorities, Philip Morris has begun a string of community 'antismoking' initiatives. As part of the initiative, a school book cover distributed to 43,000 schools in California shows a colourful cartoon snowboarder with the words "Don't wipe out. Think. Don't Smoke'. Although education bodies were delighted at first, they later noticed something sinister. When studied closely. the snowboard appeared to resemble a lit match and the snow cigarette smoke".
Those of your Lordships who have ever attempted to persuade your teenage children not to smoke, as I have, know that if you associate anti-smoking messages with boring establishment bodies, you enhance smoking's rebellious connotations and turn it into a rite of passage. So we can be sure that the tobacco industry will be able to afford the best and most expensive psychologists who specialise in teenagers and we can expect to see lots more "reverse advertising" based on the belief that if kids are told not to do something, they do the opposite.
What will make a difference is a ban on cigarette advertising and rigorous action against smuggling. Norway, Finland and New Zealand have all recently prohibited tobacco advertising as part of a comprehensive tobacco control strategy. The per capita consumption of cigarettes dropped by between 14 and 37 per cent after the ban took effect. That is why this Bill is so important and why we should welcome it unreservedly.
5.58 p.m.
Lord Glenarthur: My Lords, it may be a Bill of modest size in terms of its dimension on paper but I believe that it is a Bill of truly major significance. Although the noble Lord, Lord Hunt, did not use these words, the Minister for Public Health in another place described the Bill as "a ground-breaking measure". I presume he means something which has not been done before. He based that remark on two counts. First, it introduces a comprehensive ban on tobacco advertising and sponsorship. Secondly, it makes specific provision to address advertising on the Internet. I believe that the Minister in the other place was excessively modest; the Bill is much more significant than merely "ground-breaking".
I have spoken on the subject previously and have had a number of conflicting interests to declare. First, I hate smoking, which is well known by most of your Lordships, although I have learnt to be tolerant. I have no hostility whatever to those who wear the tie that is being sported by the noble Lord, Lord Mason of Barnsley, who is not in his place, and others who are members of the same club.

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Secondly, between 1989 and 1996 I worked for Hanson plc, which owned Imperial Tobacco. Following the Hanson demerger, I continued for a couple of years as an adviser to the Imperial Tobacco group. Thirdly, during that period and subsequently I was chairman of an NHS trust, which did not exactly encourage smoking, and I am now governor of Nuffield Hospitals where the same conditions apply. I have never smoked, although, interestingly, for a short time on medical advice I was encouraged to take snuff. I dabble in that now only occasionally.
Paragraph I of the regulatory impact assessment which was published last year states that,
"The ban is to cover any means of bringing a tobacco product to the attention of the public".
That is a far more ambitious and comprehensive objective than a simple ban on tobacco advertising and sponsorship. It also goes much further than the principle which I believe was in the Labour Party's manifesto pledge at the time of the general election in 1997. That principle, which was far more modest, was to ban tobacco advertising, but somehow the Government's ambitions have grown: first, by the inclusion of a ban on sponsorship, and, secondly, by their support for the European directive on tobacco advertising, which in October of last year was annulled by the European Court of Justice. This Bill largely mirrors the provisions of that directive. I believe that the principled objections to the directive apply just as much to this Bill.
Like the directive, the Bill was promoted by the Department of Health. No one would expect it to be essentially a Bill about health with predictable health provisions, which I am certainly keen to support. In that respect I share the views of the noble Lord, Lord Walton of Detchant. But the Bill is not just about health, any more than was the directive which, according to the European Court of Justice, was wrongly promoted as a single market measure. The provisions of this Bill appear to be concerned almost solely with issues of business and commerce which I believe are more appropriate to the Department of Trade Industry than simply the Department of Health.
Of course the Bill has a health objective. The health risks of smoking arc well known and have been generally recognised by successive governments. The connection made by the Government is that tobacco advertising and promotion has the effect of increasing tobacco consumption and the prevalence of smoking; in other words, for the Government, tobacco advertising is a public health issue, as the noble Lord, Lord Hunt, said at the beginning of the debate.
In the light of the observations of the noble Lord, Lord Walton of Detchant, I entirely agree that there is some evidence to support the contention that the limited tobacco brand advertising permitted in this country might be responsible for an increase in the prevalence of smoking. But no one is able to justify that completely.
Similarly, there is no reliable or convincing evidence that this Bill, which bans any means of bringing tobacco products to the attention of the public, will
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reduce consumption. It is a piece of guesswork. Even the Government admit in the Explanatory Notes to the Bill that their justification for the Bill is no more than an assumption, made for the purpose of the Bill, that the outcome will be a reduction in consumption in the long term of about 2.5 per cent.
The Government have prayed in aid two studies. The noble Lord, Lord Hunt, referred to the Smee review published in 1992. That was carefully dealt with by the noble Lord, Lord Harris of High Cross. However, perhaps the noble Lord could have referred to one additional point; namely, that those data were probably flawed. But, even more significantly, the author of the report made clear in a statement published in The Times on 22nd January 1993 that the Smee review,
"looked at the conflicting evidence of bans in other countries and made no estimate for the UK".
What is the value of that particular piece of evidence?
The second report cited by the Government is the much more recent review published by the World Bank in 1999. The principal relevant conclusions of that report were: first, that price increases on cigarettes were highly effective in reducing demand, and that policymakers should use as a yardstick the tax levels adopted as part of the comprehensive tobacco policies of countries where cigarette consumption has fallen. Secondly, non-price measures can reduce demand for cigarettes but comprehensive bans can reduce demand by more. It does not say that they always do, any more than the report claims to have specific relevance for the UK where tobacco advertising and promotion is already severely limited.
If the first conclusion is truly valid, why does this country now have the greatest tobacco smuggling problem of any country in Europe, as so many noble Lords have said? If the loss is £1 or £2 billion a year, since 1997 the Exchequer has lost between £8 and £9 billion of potential tax revenue, which is a very substantial figure. Worse than that, children have gained easier access to tobacco products. Thousands of legitimate retail businesses have been affected. As my noble friend Lord Oxfuird said, perhaps most important of all—and most disappointingly to all those who wish to see fewer people smoking in this country—tobacco consumption has increased since 1997 by 6.5 per cent. I fear that this Bill will not assist in any way to reduce that consumption: it may well have the perverse effect of increasing it.
My noble friend Lord Naseby referred to price as the most important determinant of tobacco consumption; indeed, the precept which underpins the general policy of governments is to increase tobacco excise as a means of reducing overall consumption, except when it leads to the development of an illicit market in smuggled products. However, I note that the increase in tax in the previous Budget was remarkably small. I wonder why.
Without the ability to undertake brand advertising and promotion, which is the objective of this Bill, the sole means by which manufacturers will be able to compete one with another is by distribution and price.

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That will lead to a major change in market behaviour and purchasing. Prices will become a much more significant factor, as my noble friend Lord Liverpool said, with competitive pressures reducing average prices in the medium to long term. Just as consumption is known to fall when prices rise, so consumption will rise as prices fall. I am, therefore, deeply concerned by the consequences for tobacco consumption which lie in this Bill. I believe that the Government's assumption of a reduction in consumption of 2.5 per cent is misplaced and misconceived. The Bill will increase, not reduce, consumption or the prevalence of smoking.
But matters are worse than that. The Bill goes to inordinate length to ban almost every possible avenue of communication between manufacturers. Your Lordships have heard before, and will hear again from me, that it is not against the law to manufacture or import tobacco products provided that the regulatory requirements relating to them are met. It is not against the law to sell tobacco products, except to children under 16. Those products are sold through more than 200,000 retail outlets. It is not against the law to buy and smoke tobacco products, and one third of all adults in the UK—15 million people—smoke. That is hardly a minority habit.
To return to the public health comments of the Minister in the other place, this Bill is a groundbreaking measure. Worse than that, to impose a total ban on all advertising, promotion and sponsorship relating to perfectly legal products is unprecedented. But other substantial freedoms which are restricted by this Bill have been referred to by many noble Lords this afternoon. Freedom of speech and expression is largely curtailed. The Bill does not even permit a manufacturer to initiate any contact with the customers for his products that may conceivably promote, or have the effect of promoting, those products to those persons. He is not permitted to do that even when the individual has expressed a desire for such communication. Therefore, the freedom of the individual is greatly limited by the Bill.
I understand that the Government seek to justify such an extreme provision by claiming that it is morally unacceptable for a manufacturer to make contact with smokers who at that point may be trying to give up smoking. The Government cite market research that indicated that 70 per cent or more smokers say that they would like to quit smoking. I am sure that that is the case. I am all in favour of it. However, the Government's policy is misguided in telling smokers how difficult it is to give up smoking, while, at the same time, urging them towards pharmaceutical products that may help them quit. The simple reason for that is that there are millions of people who have given up smoking in this country without the need for any assistance. Indeed, I understand that ex-smokers significantly outnumber current smokers.
My noble friend Lord Geddes referred to two lines in Clause 4(1)(b) of the Bill. I agree with every word that my noble friend said; it is a further demonstration
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of the Government's enthusiasm for banning things and their lack of enthusiasm for freedom of speech, other than perhaps in certain selected spheres such as culture. The Bill attacks the right to intellectual property in its provisions on what the Government call brand sharing. Why is that particular provision in the Bill necessary?
I should like to pick up on what my noble friend Lord Northesk said relating to e-commerce. I would simply stress one point that I am not sure that he referred to. That is that if the EC e-commerce directive must be undertaken by the Government by 17th January next year, why are the Government bringing in legislation in advance of that particular date? As the noble Earl said, in this country we try to make the best and become a market leader in e-commerce.
My last point relates to Scotland. Why should the regulations in Scotland applying to advertising at the point of sale, displaying of products, advertising in the shops of specialist tobacconists and the timetable for the ending of a sponsorship agreement, be any different from those in England, Wales and Northern Ireland? Perhaps the Minister in his closing speech will tell us whether that has anything to do with human rights law and the possible challenges to the Bill that might be made in Scotland.
The Scotland Act 1998 requires all Scottish legislation to be compliant with the European Convention on Human Rights. Legislation can be struck down by the courts if that is not the case. The courts do not have the same power with regard to legislation at Westminster, even if in subsequent proceedings the courts make a declaration of incompatibility which remains intact unless repealed or amended by Parliament.
There are far more certain ways by which we can achieve reductions in tobacco consumption and not have to pay the excessive price that the Bill demands. Nothing significant is being achieved by a policy of intense hostility to tobacco. It will not produce the intended reaction in the population. What is needed is a thorough review of the Government's overall antismoking policies in advance of any legislation and, I would also add, a review which ignores political correctness and prejudice.
6.13 p.m.
Lord Palmer: My Lords, smoking is the most disgusting habit ever invented. It is my biggest regret that, aged 17, I started to smoke. I am pleased to say that I have not smoked a cigarette for I 1 years, as I vowed to my children that I would quit after my maiden speech.
I must declare an interest in that I smoke cigars and belong to the all-parliamentary Lords and Commons Pipe and Cigar Club, so ably convened by the noble Lord, Lord Mason. I apologise for not wearing my club tie this evening. I also should declare that my old family firm Huntley & Palmer Foods was eventually acquired by R J Reynolds Tobacco; and I think that the noble Lord, Lord Naseby, must have forgotten that he also used to promote our products.

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I was told this morning that the debate would end at around 6.30 p.m. If it ends very much later than that, I fear I shall be unable to stay for the closing speeches. I apologise in advance to the House if that is the case. However, the tradition of staying for closing speeches seems to have gone by the way following the example of the noble Lord, Lord Bassam of Brighton, who was absent for the closing speeches at the end of the Second Reading of the Hunting Bill—a Bill which he introduced into your Lordships' House.
Personally, I think that all smoking should be banned. However, we all know that that is totally impractical as Her Majesty's Government would greatly miss the £10 billion annual revenue. But we must be realistic. Smoking of tobacco products is legal in all countries in the world. As long as it is legal, it must be wrong not to be allowed to promote it. I echo the elegant 'words of the noble Lord, Lord Geddes. I also totally agree with the remarks of the noble Lord, Lord Tomlinson, and others, about the idiotic case of tobacco subsidies being given to our European partners to grow tobacco. I hate the way that "banning" has become the new "in" word of Her Majesty's Government.
After the Countryside Alliance rally in Hyde Park three years ago, the Daily Star, of all papers, had an editorial which stated:
"Let's have a Bill to ban banning".
How I echo those words.
With three teenage children, one of whom has never smoked and two who have just given up, I am fortunate to come into contact with a great many teenagers. Unfortunately, many smoke and none of them is influenced by cigarette advertising as to whether or not to smoke. It is simply a matter of brand loyalty. Her Majesty's Government must take that matter on board.
Would not the Government be better employed tackling the large numbers of illegal cigarettes now so freely available—a matter mentioned today by almost every speaker—rather than abolishing advertising which has virtually no effect on consumption? The Government claim that banning advertising will reduce consumption, and yet they have not come up with any conclusive evidence to prove this theory.
There is one matter that concerns me tremendously. We must not forget that there is well-documented health advice on all tobacco advertising. However, if a ban ensues, that advice will no longer be available for the public to see.
If the Bill was going to have the desired effect of stopping people smoking then I would support it, but such a badly flawed Bill as this will not have the desired effect. I believe that the Bill is political correctness gone completely over the top. I am afraid that I cannot support it.
6.17 p.m.
Viscount Simon: My Lords, I was fascinated by the reminiscences of the noble Lords, Lord Geddes and Lord Walton of Detchant. 1, too, took advantage of
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the cheap cost of cigarettes in the 10 years that I was at sea. I gave up 30 years ago when I was forced to do so by a bout of encephalitis and meningitis which formed some kind of aversion to cigarettes. Despite that aversion, I lit up friends' cigarettes because I still had the desire for another eight years. Eventually the aversion won and I have not smoked for many years.
I am grateful to the Government for bringing forward the Bill, which should be whole-heartedly supported. I must declare an interest as I suffer from asthma contracted some six years ago which is made very much worse by inhaling any form of tobacco smoke, and, therefore, would benefit personally from fewer people smoking.
My noble friend Lord Hardy of Wath was somewhat dismissive of the effect of passive smoking on people. I can inform him from personal experience that I will have—I define the word "will" as 100 per cent certain—a serious asthma attack in less than 20 seconds if I inhale certain forms of tobacco smoke.
Let us make no mistake about the issue, the effect of the Bill would be a substantial reduction in the number of people smoking and, more importantly, the number of people dying from smoking. With the Bill we have a chance of saving thousands of lives each year. The Government's estimate is that 3,000 lives a year will be saved through banning advertising. That is almost exactly the same number as those killed on the roads each year. As a nation we are rightly prepared to spend huge sums of money to reduce the number of road deaths; with the Bill we could save the same number of lives without spending anything. The figure of 3,000 a year may even be a cautious estimate, because the World Health Organisation believes that almost twice that number of lives could be saved.
The tobacco companies, and their representatives in this House and in another place, will say that there is no need for the Bill, that advertising does not lead to anyone taking up smoking. That very much begs the question of what on earth this advertising is for if not to encourage non-smokers to smoke and to discourage smokers from giving up. Furthermore, if that is the case, why are they wasting such huge amounts of money on pointless advertising?
The chairman of McCann-Erickson, an advertising company that has handled multi-million pound tobacco contracts, backs up this view. He said:
"The cigarette industry has been artfully maintaining that cigarette advertising has nothing to do with total sales. This is complete and utter nonsense. I am always amused by the suggestion that advertising, a function that has been shown to increase consumption of virtually every other product, somehow miraculously fails to work for tobacco products".
That is, in effect, somewhat contrary to the viewpoint of various noble Lords who have spoken in the debate.
Lord Monson: My Lords, does the noble Viscount think that the consumption of washing powder increases because it is advertised? Surely the same amount will be used. Advertising simply causes people to switch from one brand to another; nothing else.
Viscount Simon: My Lords, I tend to disagree with the noble Lord. We have our own points of view.

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The noble Lord, Lord Lucas, was clearly concerned about advertisements cleverly concealing their real purpose. I wonder whether he has considered the fact that, as a health warning has to be given, any editor or owner of a publication can be in no doubt that tobacco products are involved.
Lord Lucas: My Lords, if an advertisement was so obviously a tobacco advertisement, one would not need to reverse the burden of proof to prove that someone knew that it was a tobacco advertisement. It is plain and obvious. It is the reversal of the burden of proof, not putting an onus on publishers, that concerns me.
Viscount Simon: My Lords, I certainly see what the noble Lord is getting at. But the fact remains that a health disclaimer has to be put on any tobacco advertising. If any editor or owner of a publication sees that, he knows that the product is tobacco.
The fact is that the advertising of cigarettes, like advertising for any other product, works. In every country where tobacco advertising has been banned, it has led to a sharp fall in the number of people smoking. Much as we like to pretend the opposite, we are all vulnerable to the advertiser's art. The big difference, though, between tobacco advertising and the advertising of any other product is that only tobacco products will kill you if they are used exactly according to the maker's instructions.
I suppose that we should not be too surprised that the tobacco companies would be a little reluctant to give us the real reasons why they want to keep on advertising. After all, these companies do not have a flawless record when it comes to being honest with their customers. They maintained for years—even under oath in the United States—that smoking did not cause cancer, when their own internal documents revealed that they knew many years earlier just how harmful tobacco was. They continued to maintain that smoking is a habit that is no more addictive than playing the National Lottery. I am led to understand by ASH that the Department of Trade and Industry is currently investigating one of the largest of their numbee—British American Tobacco—for alleged involvement in aiding and abetting smuggling. As I said, these companies do not have a flawless record. That is why we must take with a pinch of salt their reasons for opposing the Bill.
These companies would rather see a continuation of voluntary self-regulation. They argue that that has worked well. Indeed it has—for the tobacco companies. A Health Select Committee report in another place summed up their attitude to this regulation best by saying:
"Regulations have been seen by tobacco companies as hurdles to be overcome or side-stepped; legislation banning advertising as a challenge, a policy to be systematically undermined by whatever means possible".
That is a damning assessment of their attitude and one which underlines the need for legislation to prevent it carrying on. We should give the Bill every support, as an important step in improving public health.
6.24 p.m.
Baroness Anelay of St Johns: My Lords, I have two interests to declare. The first is that, like some other noble Lords, I am a lifelong non-smoker. I tried a couple of cigarettes when I was taking my university finals more than 30 years ago. Unlike my noble friend Lord Tebbit, I did not inhale, but I still thought that they were awful and I have not tried again since.
My second interest is that over the past two years I have attended two cricket matches as a guest of Gallaher in my capacity as Opposition spokesman in your Lordships' House on sport. That should be put within the proper context. Over the past 30 years I have attended countless golf tournaments and football and cricket matches—I am the golf nut and my husband is mad on cricket and football, so we see the lot—both as a paying customer and as a guest of friends who have nothing to do with the tobacco industry.
I put down my name to speak because of my concern about what will happen to some sports over the next three or four years as they face the cliff-edge in the loss of their sponsorship by tobacco companies. Earlier in the debate the noble Lord, Lord Faulkner of Worcester, referred to sports sponsorship within the context of what it might do in attracting new business. I am addressing the issue from the point of view of the impact that the Bill will have on sports governing bodies themselves.
I do not object to the Bill on the basis that it seeks to reduce smoking—I hope that I have made that clear—but it is a flawed Bill because of its unfair treatment of different sports, all of which currently rely heavily on tobacco sponsorship. Clause 19 allows the Secretary of State to make regulations to specify when the ban on sponsorship in Clause 10 should take effect. We know that the latest date is 1st October 2006. We also know that the Government will give preferential treatment to Formula 1 and snooker. I have nothing against either sport. Indeed, how could I, of all people, object to Formula 1 being treated fairly, living as I do in Woking, the home for a long time of McClaren! But I do object to the Government treating other sports unfairly.
It is perverse of the Government to say that two sports are global and therefore, hey presto, they can have until 2006 to sort out their sponsorship deals, whereas other sports like darts have to face that cliffedge drop in sponsorship by July 2003, even though they have players from across the globe and have global appeal.
The Government set up a task force, which was intended to help sports adjust their sponsorship deals in advance of the loss of the tobacco industry money. I am grateful to the Central Council of Physical Recreation for its briefing on this matter. It attended the meeting in November 1997, which explored the issues surrounding the banning of tobacco sponsorship. It then wrote, via the Sports Sponsorship Advisory Service, on four occasions to 1,000 British companies highlighting the potential for sponsorship opportunities. To date, no sponsors have been found.

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To suggest that sports can find replacement sponsors easily is a misunderstanding of the commercial market place. The current shortfall for the sports is estimated to be £10 million with an additional £10 million for marketing the sporting events. The general secretary/director of the British Darts Organisation, Mr 01ly Croft, wrote to my honourable friend in another place, Mr John Greenway, and made this point about the task force:
"The 'Task Force' was simply a gesture to give the impression we were being given assistance. In truth, there probably isn't a business out there which can replace the funding we receive from Imperial Tobacco … Our main concern is that we only have until 2003 to save our sport. What would help enormously is an extension to 2006 like Formula One and snooker. We can fulfil the Government criteria of being a global sport … The number of countries which are members of the World Darts Federation or associate international members of the British Darts Organisation shows that that claim can be justified".
I have spoken to Mr Croft this week and he confirms that his views remain the same today. Will the Government undertake to reconsider this matter even at this late stage?
There is also the danger that the Bill could be just the first step in a series of banning orders on sponsorship of sports and arts in general. Will we see the state making a decision that other businesses should not accept sponsorship from alcohol producers? We heard a timely reminder of that risk from the noble Lord, Lord Stoddart of Swindon, with his intriguing First Reading of a Bill to prohibit the advertising of alcohol.
It is interesting to note that Carling has just given up its sponsorship of' the Premier League, but the only realistic bidder able to take over as a sponsor is Budweiser, another brewer. One of the world's premier steeplechases is sponsored by Martell. The House should be alert to the damage that would be done if such sponsorship were ended.
I have pointed out that the Bill is flawed because of its unfair treatment of different sports, but it is also important to note that the Bill is flawed because of its inadequate definition of what constitutes a "tobacco advertisement". Have the Government considered the impact of Clause 2 on the incentives industry? By that I refer to those businesses which print the logos and advertisements on prizes and awards given away not to the public, but offered to employees during the course of a corporate sports event. The sector represents a large and serious business in this country.
What will happen in the future at a tobacco company sports day such as, for example, a golf day? It is normal practice for the corporate sponsor—the employer—to give those taking part—be they direct employees or even their guests—a clutch of golf balls to start off the day. I should observe to noble Lords if their game is anything like mine, after four years in this House and thus hardly ever playing, by the end of the day those golf balls are firmly lost in the rough. At the end of play, prizes are presented to those who last the distance. It is commonplace for all such items—golf balls, golf umbrellas, golf shirts and so forth—to be overprinted with a logo.
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This practice is not "brand-stretching" in the manner referred to by other noble Lords in the debate. This is overprinting of equipment which has been made by other manufacturers who have no business relationship whatever with the tobacco company. But no doubt the items are used, in a sense, for advertising. Are they to be made illegal by this Bill? I believe that they will be. Is that right? No, I do not think that it is.
What would be the situation if no outside guests attended the event, but rather that it was run only for employees? Would that make a difference? This is a legal question which has not yet been answered by the Government. I merely cite an odd example to reflect a Bill that has many oddities in it.
I am concerned also about the impact of the Bill on tobacco companies which sponsor local arts organisations. When I go to my local theatre in Woking, the Victoria, I walk past a prominently displayed list of corporate sponsors. I do not object to that in any way. But why should tobacco companies have to be excluded from such a list, simply because there is a chance that people might associate the name with a brand of cigarettes? Is that correct? Where in the Bill is there protection against that kind of practice?
I should like to refer to a final anomaly, which was mentioned briefly in another place but did not receive a sufficiently detailed response from the Minister. This anomaly arises in the case of museums which display tobacco advertising as part of their exhibits. Why should they be caught out by this Bill? The Parliamentary Under-Secretary of State for Health in another place said that the Government did not want to catch,
"historic tobacco advertisements or items of historic branding value".—[Official Report, Commons, 13/2101; col. 219.]
or to,
"prevent museums from displaying historic posters".—[col. 220.]
But of course that is exactly what the Bill will do because some posters of historic value would depict brands that are still being sold today. History can begin in the very recent past.
Can the Minister further explain where in the Bill will protection be offered to museums such as the Broseley Pipe Works and the Clay Tobacco Pipe Museum, which has its own website and is featured on the Kidsnet website? Furthermore, will protection be offered to lifestyle museums which depict life as it is and was? Do we have to censor history now?
This is a flawed Bill. Noble Lords have pointed out serious flaws with regard to human rights; I have pointed out flaws with regard to the sponsorship of sports and protection for the arts. I hope fervently that tobacco consumption can be reduced, but am far from confident that this Bill will achieve that.
Lord Tomlinson: My Lords, before the noble Baroness sits down, perhaps I may put a brief question to her? She said that the Bill was flawed in relation to sports sponsorship. Does she agree with what the Central Council for Physical Education also said in its briefing; namely, that it does recognise the incongruity

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of sponsorship with health and related matters, of which sport is one? The council is therefore seeking to find alternatives.
Baroness Anelay of St Johns: My Lords, I quite agree with the point made by the noble Lord. I am sorry if I did not make that clear when I referred to the fact that I had understood, from the speech made by the noble Lord, Lord Faulkner of Worcester, that he was referring to the health impact of sports sponsorship. Certainly I do not propose that sporting bodies should continue for ever to accept tobacco sponsorship of their events because of the incongruity pointed out by the CCPR. What I am saying here is that I think that the Government have adopted an improper route by discriminating unfairly against some sports while helping others.
6.36 p.m.
Lord Stoddart of Swindon: My Lords, like other noble Lords, I should declare an interest in that, because I am a non-smoker, I am an associate member of the Lords and Commons Pipe and Cigar Smokers Club. I am also a patron of FOREST.
One of the advantages of speaking towards the end of the list of speakers is that one has been able to listen to so many marvellous contributions to both sides of the argument. I have been able to count how many of those have been in favour of the Bill and how many have been against it. My tally is that 14 speeches have been made against the Bill and only eight in favour of it. At this stage, the House does not appear to be in favour of the Bill.
I listened with interest to the speech of the noble Lord, Lord Tebbit, who pointed out the incongruity of the policy being followed by the EU. On the one hand, it subsidises tobacco to the extent of some £600 million a year; but on the other hand, it wants to bring in legislation to ban the advertising of tobacco because it wants to see the consumption of tobacco reduced. Thus one part wants to increase consumption while the other part wants to reduce it. My noble friend Lord Tomlinson was absolutely right to urge the Government to take action on this incongruous and absurd situation.
I listened also to the contribution made by the noble Lord, Lord Walton of Detchant, to whom I always listen with the utmost respect. In his remarks he cited figures on the number of deaths due to smoking; namely, that 120,000 die from smoking each year. I am sure that he will agree, first, that that is an estimated figure because, after they have died, records are not kept as regards whether people were smokers.
Secondly, if 120,000 people die of smoking-related diseases each year, some 600,000 do not die of smoking related diseases; they die of something else. After all, in the end we all have to die of something. However, the House should take some encouragement from those figures. While we have been debating this issue, the number of deaths has gone down. That is because, as my noble friend Lord Dubs said, during the time it
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would take for him to make his speech, three people would die from cigarette smoking. My noble friend spoke for 10 minutes. I have done a calculation which shows that, on that basis, only 52,560 people would die each year. It seems that we are making progress even without this proposed Bill to ban tobacco advertising.
In my view, the Bill is a continuation of the prolonged witch hunt against smokers. It is a witch hunt that has penalised and demonised smokers for using a legal product—that has been emphasised time and time again during the debate—out of which the Government have made enormous, incalculable Profits.
But there are 13 million smokers—some people put the figure as high as 15 million smokers—and I understand that we are shortly to have an election. It may very well be that the people who are witch hunted and demonised will take note of what is happening. I urge the Government not to be so harsh on a very large proportion of the voting register.
It is smokers—not the tobacco companies—who have suffered from the witch hunt. The companies continue to thrive and shares in them are very buoyant. You should not think that you are getting at the tobacco companies; they will survive. You are getting at the ordinary smokers who derive pleasure from the habit.
This Bill has been brought forward in the wake of a complete failure of governments to deal with the problem. In spite of all the measures by governments against it—the health warnings, the draconian measures against retailers, the huge amounts spent on measures to reduce smoking, the subsidisation of virulent anti-smoking organisations, such as ASH, and, above all, the penal tax, about which we have heard so much, levied on smokers by successive governments (indeed, the previous government imposed the escalator tax, which this Government has now removed)—smoking is on the increase. The smoking bans by airlines, bus companies, train companies and others, have all failed to bring about the desired objective of governments and of ASH to make Britain a tobacco-smoke free zone.
The Government's desperation has led them to bring forward this undemocratic piece of legislation to deny free speech—because that is what it is, make no mistake about it—and free communication between buyer and seller, and competitive advertising between businesses selling a legal product. I and others have warned time and time again that the Government and their subsidised mouthpieces, such as ASH, were following the wrong policies on smoking and that they were likely to be counter-productive. So it has proved. Not only is smoking on the increase—especially among women and the young—but the yield from tobacco taxation, as we have heard, has been hit by the law of diminishing returns.
Tobacco smuggling has become endemic in our society. Indeed, it is tolerated and even encouraged by the mass of the population. At least one third of cigarettes are now smuggled, and the police and customs officials cannot cope with the problem. They

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never will be able to cope with the problem. Cheaper, and often inferior, cigarettes encourage additional consumption and make it easier for people, especially young people—despite what my noble friend Lord Faulkner said—to start smoking. They are encouraged to start smoking if they can buy them cheaper, make no mistake about that.
So we have now come to this Bill to ban tobacco advertising and promotion. It is certainly an illiberal, draconian piece of legislation, produced, I understand, without proper consultation with the industry. That is completely undemocratic; the industry is entitled to be consulted about measures which will hurt it and its relationship with its customers. It is an industry which has co-operated fully with governments in the past over advertising.
The tragedy is that the measure is unlikely to achieve its objective—which is, in any event, very limited. A 2.5 per cent reduction in consumption is a very small reduction—it is practically nothing—especially when one considers that other government measures, such as penal taxation, have increased consumption by 6.5 per cent. Even if the Bill achieves its objective, it seems to me to be a very large hammer to crack what will be a very small nut.
It also seems to me that, by the Bill, the Government are shooting themselves in the foot. The largest part of tobacco advertisements blazons the message that smoking causes every disease under the sun or kills you. Indeed, not only you but everyone else, apparently. That is free advertisement for the anti-smoking cause which will not appear. So if tobacco adverts are deemed to encourage people to smoke and to start smoking, then advertisements against should do the reverse. Is that not right? Thus the advertising ban becomes self-defeating. As I say, the Government have shot themselves in the foot.
The arguments against the Bill are many and weighty and are being deployed around the House. But the argument which should give pause to supporters of the Bill is where does banning advertisements of legal products stop. Which is the next product in line for a Bill to ban its advertising if this Bill passes into law? As it happens—as some noble Lords know—I can answer that question: it is liquor. Today, I have introduced a Bill. the Liquor Advertising and Promotions Bill [H.L.]. It is a Bill which follows very, very closely the provisions of the Bill before us, as noble Lords will see when it is published, probably tomorrow.
Everyone agrees that alcohol is, of course, the most dangerous drug of all. It is addictive and it is dangerous in its effect on others—drink/driving, for example, kills 800 people every year and injures seriously at least 10,000. People are involved in violent crime because of alcohol; in violence towards others; in wife beating; sometimes in husband beating; in children beating. Alcoholism is an increasing problem. The young are increasingly hooked on binge drinking and women have taken to the bottle as never before. It causes the death of some 35,000 younger people. Do not forget that smoking, if it kills, affects older people, over 65, but alcohol kills about 35,000 younger people
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every year. That is set out not by me but in a report of the Royal College of Physicians published in February of this year.
So this perhaps is the future; tobacco today and alcohol on the agenda. It is well and truly on the agenda now; it is before the House, make no mistake about that. What is next—motoring?
Lord Tebbit: My Lords, I am grateful to the noble Lord, Lord Stoddart, for giving way. When does he think the collision will come between measures to ban such things as tobacco advertising and alcohol advertising and measures to liberalise the regime concerning cannabis and other so-called soft drugs? It seems that at some stage there will be an extraordinary collision.
Lord Stoddart of Swindon: My Lords, it is a most interesting question. It intrigues me. I know people who are hooked on cannabis but who are anti-tobacco. I cannot understand it, but it is true. cannot answer the noble Lord's question, but it will be interesting to see what happens when the collision comes.
As I say, alcohol is on the agenda today; it could be motoring tomorrow: 3,600 deaths—not estimated but actual—are caused every year as a result of motoring. There are 45,000 serious injuries, not imagined but actual. Medical problems are caused by exhaust fumes. Asthmatics in particular are affected—10,000 deaths a year are caused by fumes in London alone. Noise pollution, congestion costs, environmental pollution, CO2 emissions leading to global warming, and damage to property are all the result of motoring. Are there any noble Lords who disagree with that list? No, of course, they cannot. We all know that motoring causes those difficulties.
Lord Haskel: My Lords, I disagree with the noble Lord's list. His list did not include the banning of guns, for example. The fact that guns have been banned has probably saved a large number of lives, so he had better add all those on.
Lord Stoddart of Swindon: My Lords, let me answer the noble Lord. I have been following recent Answers to Questions on these matters. He will find that since we banned handguns the number of homicides has increased.
Lord Haskel: My Lords, handguns were banned years ago.
Lord Stoddart of Swindon: My Lords, I assure the noble Lord that handguns were banned in 1997. There was one Bill before the general election and one following the general election. I opposed both of them; that is why I know what I am talking about.
As I made clear, I do not believe that we should go round banning the advertising of legal products which are alleged to be harmful to humans. I have also said that I do not believe that brand advertising increases consumption. However, if Parliament in its wisdom

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agrees to this illiberal, authoritarian measure on the grounds that it will lead to reduced consumption and fewer users of tobacco, I shall certainly take my Bill to Second Reading so that we can consider applying to the most dangerous substance the same treatment as we are meting out to the tobacco industry—or at least consider why we should not do so. A Second Reading of my Bill may also serve to remind those in other industries, including advertising and the media, as well as industries whose products are said to be harmful, that their silence and acquiescence in relation to this Bill may have ramifications far wider than they contemplate at present. I hope that even at this late stage the Government and the supporters of the Bill will have second thoughts about it.
Lord Monson: My Lords, before the noble Lord sits down, is he aware that the figure of some 52,000 smoking deaths a year, which he cleverly extrapolated from the figures given by the noble Lord, Lord Dubs, is very close indeed to the estimate of 50,000 smoking deaths a year which the DHSS, as it then was, gave to Lord Houghton of Sowerby in a Written Answer some years ago? Is this not a far cry from the inflated figure of 120,000 that we are given today?
Lord Stoddart of Swindon: Yes, my Lords. It is interesting that when those figures were given to the late Lord Houghton of Sowerby, smoking was much more prevalent than it is now. So there is a reduction in the number of people smoking but an increase in the number of deaths. I do not know where that gets us.
6.55 p.m.
Baroness Gale: My Lords, at Second Reading in another place, the Secretary of State for Health said:
"Advertising smoking both works and kills. Today, we can begin to break that link"—[Official Report, Commons, 22/1/01; col. 664.]
I wholeheartedly agree. The Bill is long overdue. Anything that can be done to prevent people starting to smoke must be welcomed
The benefits of the Bill are in addition to other measures announced by the Government—such as the increase in tobacco duty, measures to crack down on tobacco smuggling and an education campaign to inform the public of the dangers of smoking, together with information and services to help smokers to give up, and the latest government announcement that aids to smokers in giving up the habit, such as nicotine patches, will now be available on the National Health Service. That package, of which this important Bill is a part, could mean a reduction in the total number of people becoming addicted to smoking. It is estimated that 3,000 lives will be saved in the UK in the longer term as a result of the Bill. In addition, it could mean a saving for the National Health Service of up to £40 million on treatment for smoking-related diseases.
Most smokers acquire the habit when they are young—some as young as 10 years of age. If you can get through your teenage years without starting smoking, there is a good chance that you will not take
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up the habit as an adult. Therefore, the aim must be to do everything possible to prevent children and young people from starting to smoke. If that problem can be tackled, we shall be on the way to seeing a reduction in the number of smokers.
Research indicates that more girls than boys are now taking up smoking. This is a worrying trend. The dangers to a girl's future health are different from those affecting the health of boys. Young women smokers who may one day want to become pregnant will experience difficulties when trying to conceive to a greater extent than non-smokers; the danger of miscarriage is greater; and perinatal mortality is increased by about one-third in the babies of smokers—that is the equivalent to approximately 420 deaths per year in England and Wales.
Research has shown that smoking may contribute to inadequate breast milk production. The infants of parents who smoke are twice as likely to suffer from serious respiratory infection than those whose parents are non-smokers. Studies have shown that for women who smoke the risk of developing cervical cancer is up to four times higher than it is for non-smokers, and that the risk increases with the duration of the habit. The natural menopause occurs up to two years earlier in smokers. The likelihood of early menopause is related to the number of cigarettes smoked: women who smoke more than 10 cigarettes a day have an increased risk. So the dangers to women smokers of all ages are great. It is highly likely that those who are at risk started smoking when they were young. I am appalled that tobacco companies often target women in their advertising. The Bill will go some way to help with that problem.
I see the Bill as a liberating measure, as part of a package to prevent people from starting to smoke. It will liberate all those who might have started smoking and so free them from ill health and premature death. It will help them to have a better life than they would have had, had they not started smoking; and many benefits will accrue, not merely to them but to all those who might have suffered from passive smoking, including their children.
This is a good Bill. It fulfils the Government's manifesto commitment. I welcome it and I hope that it will be on the statute book before we have a general election.
Lord Glenarthur: My Lords, before the noble Baroness sits down, can she say at this stage whether or not she would support the Bill on alcohol alluded to by the noble Lord, Lord Stoddart of Swindon, for exactly the same reasons?
Baroness Gale: My Lords, I have not looked at the Bill yet, but as a non-smoker and a teetotaller, I probably would.
7 p.m.
Lord Patel: My Lords, I thank your Lordships for the opportunity to speak in the gap. I had not put my name down on the list of speakers as I did not expect to be here in time.

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In supporting the Bill I would like to add to the list of health hazards of smoking mentioned by my noble friend Lord Walton of Detchant. I say to him that the illusionary pipe that he saw was always a dagger. The effect of using either would be the same. I would like to declare an interest. I am associated with the charity QUIT. It is a charity concerned with helping people to stop smoking.
I would particularly like to mention the effect that smoking has on pregnancy. It has the effect of reducing birth weight and contributes to the high incidence of low birth weight babies born in this country. We have the highest incidence of such babies in the western world, apart from the United States of America.
Smoking during pregnancy is also associated with an increased incidence of premature births with the consequences that that has on neo-natal death rates and disability. Among young mothers the incidence of smoking in certain areas of this country is as high as 42 per cent. The incidence of cigarette smoking among young women is higher than in young men and the incidence of lung cancer in young women is increasing. In some parts of Scotland, for instance, the commonest cancer now in women is lung cancer and it is higher than breast cancer. I say to the noble Lord, Lord Monson, that snuff is not harmless. It increases the risk of cancers of the throat and nose.
Let us not pretend that the advertising of tobacco is not aimed at promoting smoking and is not primarily aimed at the young. I have never seen a septuagenarian or an octogenarian in a cigarette advertisement. One sees many young ladies on such advertisements.
Anything that we can do to reduce smoking among the young has to be for the good and we should support this Bill. However, I agree with the noble Lords, Lord Tebbit, Lord Tomlinson and Lord Palmer, that it makes no sense to continue to subsidise tobacco growers in Europe. I hope that the Government: will support any moves that lead to removing that subsidy. I support the Bill.
Lord Skelmersdale: My Lords, I had not expected to be here this evening and shall not make a speech on the Bill. But there is one matter that concerns me and when the Minister winds up I hope that he will be able to help me. Clause 4 deals with advertising exclusions. Subsection (1)(d) states,
"If [an advertisement] is contained in an in-flight magazine provided on board an aircraft by an airline which is not a United Kingdom airline"
that is a defence to Clauses 1 and 2. Why is that not hybrid?
7.4 p.m.
Lord Clement-Jones: My Lords, we have had a very interesting and an unusually gladiatorial debate today. From the outset on these Benches I want to state unequivocally our welcome for the introduction of the Bill. We have long advocated the banning of cigarette advertising on public health grounds. Indeed, my honourable friend Simon Hughes attempted to bring in a Bill to that effect in 1996. Despite the successful
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legal challenge to the European directive in the European Court of Justice last October, which was alluded to by the noble Lord, Lord Tomlinson, the Government have reacted and introduced this Bill quickly and I congratulate them on that.
This Bill is supported by a huge range of organisations such as the British Medical Association, the Royal College of Nursing, the Royal College of Physicians, Diabetes UK, the National Consumer Council and the Consumers' Association. As we have heard from noble Lords such as the noble Lord, Lord Walton and the noble Lord, Lord Patel, it is no wonder that smoking is a major factor in lung cancer, strokes, heart disease, diabetes and a variety of other conditions such as asthma. If we are to reduce the incidence of these conditions we need to reduce smoking levels. On these Benches we believe that this Bill will make a significant contribution to reducing deaths from smoking, perhaps more than the 3,000 or 2.5 per cent modestly claimed by the Government in the Explanatory Notes. As such, we believe that this Bill is a proportionate response.
In resisting the Bill, the tobacco manufacturers have used a number of arguments, many of which have been rehearsed today by noble Lords. First, an advertising ban infringes the principles of free speech and violates Article 10 of the European Convention. But no advertiser has unfettered freedom of speech. The existence of the British Codes of Advertising and Sales Promotion administered by the Advertising Standards Authority recognises that. Furthermore, there are provisions in the convention giving an exemption when issues of health promotion come into play.
Secondly, the tobacco industry argues that its advertising does not increase consumption or encourage people to take up smoking; it is pricing which is all important. The noble Lord, Lord Faulkner, dealt extremely ably with that. He made some particularly powerful arguments especially in the light of the fact that he is a communications professional.
The industry maintains that advertising is aimed at promoting brand loyalty—the noble Lord, Lord Harris, was very strong on that point—persuading people to switch brands or launching new ones. But it is all too clear that the advertising efforts of the tobacco companies are aimed at expanding the market as well. The former chairman of McCann-Erickson was quoted by the noble Viscount, Lord Simon, to very good effect on that point.
The internal documents from the tobacco industry's advertising agencies referred to by the noble Lord, Lord Faulkner, which are now generally classified under the title, "Keep Smiling, No-One is Going to Die", to which the health committee of the other place gained access, give a depressing glimpse of the motives and practices being pursued by the industry and its advertisers. They show very clearly how the aim is to increase consumption as well as brand share. Efforts are made to make smoking socially acceptable. They show that the industry is actively involved in increasing per capita consumption and recruiting new

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smokers. In that context the young are a key target. It is all about adding aspiration and street credibility to smoking. The advertising agencies conduct a huge amount of research into lifestyles and motivation of the young.
It is also quite clear that sponsorship and advertising are treated as one. Sponsorship is as important as advertising in promoting brand image. Above all, and most depressingly, there is a revelation of a lack of principle and sharp practice in these papers by the advertising agencies and their clients in devising market strategies.
In its report last year the Select Committee was quite correct in concluding, on the basis of the evidence,
"advertising agencies have connived in promoting tobacco consumption, have shamelessly exploited smoking as an aspirational pursuit in ways which inevitably make it more attractive to children and have attempted to use their creative talents to undermine government policy and evade regulation".
That underlines the need for flexibility in this Bill and in particular that is why we support Clause 7. It is in order to combat the ways in which the advertising agencies are going to chance their tactics in response to the provisions of this Bill.
The key issue in all of this is the recruitment through advertising of young people to the smoking habit. That is the key commercial objective of the tobacco companies. The article in the British Medical Journal of 3rd March has been cited in the debate today. Young people are extraordinarily aware of advertising. About 90 per cent are aware of postal advertising in this area.
Thirdly, the manufacturers claim that it is wrong to ban the advertising of a legal product. I believe the noble Lord, Lord Geddes, in particular raised that argument. That is a complete red herring. Guns and pharmaceuticals are products which can be manufactured and sold legally subject to regulation, but they are also subject to advertising restrictions.
Fourthly, the manufacturers claim that there is no evidence that a ban on advertising will be effective. Many noble Lords dealt with that point in their speeches today. There is abundant evidence provided that such bans are comprehensive, covering all media. It is where they are partial that the evidence is not clear. The noble Lord, Lord Hunt, catalogued the evidence. He mentioned the report of Dr Clive Smee. I believe that the noble Lord, Lord Glenarthur, interestingly, mentioned the 1999 report of the World Bank. However, I come to totally different conclusions from those of the noble Lord. The report states:
"Policymakers who are interested in controlling tobacco need to know whether cigarette advertising and promotion affect consumption. The answer is that they almost certainly do, although the data are not straightforward. The key conclusion is that bans on advertising and promotion prove effective, but only if they are comprehensive, covering all media and all uses of brand names and logos".
That was very much the conclusion that Clive Smee also reached.
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I turn to the fifth argument used by the manufacturers. We now have to call that not just humbug but perhaps the "humbuggery" argument advocated by the noble Lord, Lord Tebbit. I follow him on one point; that is, in respect of the European failure to cease subsidising tobacco growing in southern Europe. The Health Select Committee dealt with that point well. The desire to cease that subsidy is not inconsistent with a desire to ban advertising and the promotion of cigarettes. All of us would wish to see that subsidy cease, but I certainly do not follow the noble Lord into the wider realms of his arguments under that heading.
In some respects the Government's policy in this area does not go far enough. I deeply regret the Government's decision to delay the ban as regards global sports such as Formula I racing until 2006. Formula 1 cars were described by Tobacco Reporter which I must admit is a publication I have not come across before—as,
"the most powerful advertising space in the world".
I can testify to the association of Formula 1 with glamour, having followed the sport for many years. I am a keen follower of Formula 1. It is quite possible to run teams without tobacco money. My father-in-law, a fanatical non-smoker, did so for many years. He was able to secure sponsorship throughout the time that he ran a Formula 1 team. In fact, the FIA, the governing body of Formula 1, has said that it could comply with the measure by 2002. I agree with the Select Committee that sponsorship should not be treated more leniently than advertising. In fact, Formula 1 is the very sector that should not have any concessions at all. The tobacco industry boasts of its initiatives on youth smoking, but continued sponsorship of Formula 1 gives the lie to that. It is the most aspirational sport of the whole lot.
I have a further reservation about the Bill which has been raised by the noble Lords, Lord Haskel and Lord Faulkner. If we are to have a ban which is consonant with the terms of the primary legislation, the regulations must be effective, whether they concern point of sale material, displays or direct mailing. We must not have any ambiguity as regards the way in which the ban on sponsorship to promote tobacco consumption works. That is extremely important. I agree with the noble Lord, Lord Dubs, that we need clarification in that respect.
In the years since Sir Richard Doll discovered the link between cigarettes and cancer, as described by the noble Lord, Lord Walton, it has become clear that voluntary agreements on the promotion of tobacco are not adequate. As the Commons Health Select Committee stated in its report,
"Voluntary agreements have served the industry well and the public badly".
We welcomed the Bill. It is not a petty, puritanical pique—I believe that the noble Lord, Lord Harris, used that phrase—it is not unenforceable, as the noble Lord, Lord Naseby, seems to think, and it does not mean the end of e-commerce as we know it. It is not a witch-hunt; it is not even the thin end of a wedge. It is

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a significant and important step. We welcome the fact that the Bill is part of a comprehensive strategy designed to discourage smoking and prevent deaths. However, the next steps must be taken in the European and international dimensions. As a first step towards that we very much welcome the Bill.
7.14 p.m.
Earl Howe: My Lords, this has been a fascinating debate and I thank the Minister for moving the Second Reading in his characteristically clear and helpful way.
Let me begin, if I may, by repeating something that I made a point of saying during the debate on the gracious Speech. I have been, and I remain, open to persuasion on the merits of this Bill. I ask the Minister to accept that there is no difference between us on the end that we have in view, which is to reduce the prevalence of smoking, particularly among young people. He is right to say what he did about the damage that smoking does to people's lives. I shall not repeat the statistics he quoted, which we have rehearsed often in this Chamber. It is the duty of any government to look for ways of raising standards in public health, and cigarette smoking must be a prime target in that sense. Deaths caused by smoking, as the noble Lord, Lord Walton, reminded us, represent one in five of all deaths. We cannot be complacent about that, which is why I would never allow myself to condemn a Bill of this kind before considering the evidence in its favour.
It is the extent of that evidence, and its credibility, that we need to look at. I listened very carefully to what the Minister had to say. My opening comment to him is to pick up a point made by a number of noble Lords. If we are going to ban, and indeed criminalise, the advertising of a legal product and anything directly associated with that product, we need to be as sure as we can be that such a ban will work. That may be a statement of the obvious, but it has to be made.
Primary legislation is a powerful weapon. We should use it only when we are sure we need to. The Minister will not hear me say that civil and commercial liberties should never be infringed under any circumstances. There are circumstances where it is right for the state to intervene in that sense. Nor do I hold any love or any brief for the tobacco companies. The territory we are in is that of making finely balanced judgments between opposing moral principles—civil freedom and public health. Perhaps this is where the Minister and I differ.
The reason I lay stress on the need for certainty before legislating is that I start from the premise that we live in a free country. To put it at its kindest, I am not sure that Ministers in the present Government always have that thought in the forefront of their minds. Whereas the Government have the air of being instinctively relaxed about banning and criminalising things, I am instinctively uneasy about it. That is a feeling shared, I believe, by many on this side of the House. That is why I feel the need to look a little further at the strength of the evidence presented by the Minister before being prepared to set my unease to one side.
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There are perhaps two main planks on which the Government's case for this Bill rests. One is the range of evidence indicating that a ban on advertising is associated with reduced levels of tobacco consumption. The other is research that concludes that decisions of young people to start smoking are directly linked to the promotion of cigarettes.
The Minister mentioned the Smee report. That report had a powerful influence on Ministers in the previous government and formed the basis of the antismoking strategy that was then adopted, including much tighter, but essentially voluntary, restrictions on tobacco advertising. Perhaps the most important single feature of the current code, in my opinion, is that advertisements must not glamorise cigarette smoking or incite people to take it up. That is tremendously important.
The Minister was kind enough to write to me about the Smee conclusions, and other research, before Christmas, and I am grateful to him. In that letter he ended by saying—as he did today—that quantification of the effects of a ban is not an exact science. That is right. The fact is that the results of research in this area have been very mixed. As he will be aware, while Smee arrived at his own conclusions, subsequent studies have completely contradicted them. A review by KPMG was mentioned by the noble Lord, Lord Harris of High Cross. That review in 1996 concluded—I repeat the words that the noble Lord quoted—
"There is overwhelming evidence to support the proposition that advertising bans on tobacco products do not reduce tobacco consumption".
KPMG illustrated that by looking at four European countries where a ban had been introduced—Norway, Iceland, Italy and Finland. In none of those countries were trends in tobacco consumption affected by the advertising ban. In Italy during the 20 years after a ban was implemented tobacco consumption continued to rise. Other studies, post-Smee, have reached the same results as did KPMG. So while I certainly would not wish to discount Smee, 1 do not believe that his report presents us with anything like a knock-down argument.
The other aspect of the Government's case is take-up by young people. Take—up, particularly by teenage girls, is rising. Why should that be? The Government say that it is due to advertising. Again, this assertion is not self evident. The Office of Population Censuses and Surveys, mentioned by the noble Lord, Lord Harris, found that the characteristics most likely to be found among children who smoke compared with those who do not are gender—girls smoke more than boys—having brothers or sisters who smoke, having parents who smoke, living with a single parent, not intending to stay in full-time education after six years, and having relatively few negative views about smoking. The influence of advertising on smoking uptake was not found to be significant. It may seem obvious to Ministers that children first take up smoking as a direct consequence of exposure to advertisements, but if one looks for hard evidence for

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such a correlation it is lacking. In Canada the prevalence of smoking among those aged 15 to 19 actually increased following the introduction of a ban.
I make no apology for being pernickety over these issues because they are central to the Government's case. There is an obvious reason why this is such difficult territory. The biggest single determinant of tobacco consumption is price, as my noble friend Lord Naseby and the noble Lord, Lord Dubs, pointed out. That fact has been recognised by each successive Chancellor in my lifetime and no doubt by Chancellors before that. Between 1971 and 1996 smoking prevalence went down by about 40 per cent. Since 1997, total UK tobacco consumption has increased. We have to ask ourselves the question: what has changed? What has changed is not the extent or nature of tobacco advertising, the rules for which have been the same since 1994; it is something quite other. It is the increasing availability of cheap, smuggled cigarettes.
As the noble Lord, Lord Mason, and others pointed out, since 1996 the black market in cigarettes has taken off in the wake of annual tax increases of 3 per cent and then 5 per cent above inflation which have made it attractive for bootleggers to import from the Continent illegally. At £4.22 for a packet of 20, on which the tax take is higher than in any other EU country, it is no surprise that usually law-abiding citizens have been looking elsewhere for their supplies of tobacco. Although the figure is difficult to estimate, it is currently estimated that between 18 per cent and 25 per cent of all cigarettes consumed in the UK are smuggled, resulting in a loss to the Exchequer of £5 billion. The Chancellor suddenly finds himself on the wrong side of the yield curve. And the co-ordinated anti-smoking strategy adopted by the previous government, which involved a combination of high duty, restrictions on advertising and anti-smoking education, is all of a sudden thrown off course.
Typically, the cigarettes that arrive here illegally from the backs of lorries find their way to the less affluent areas of the country, to the school playgrounds, car parks and clubs where young people congregate. The Government are to be commended for taking action to try to reduce the level of smuggling. But they were late off the mark. I agree with the noble Lord, Lord Stoddart, that the scale of the problem is so vast that progress looks likely to remain modest for some while at least.
The distortion of the market brought about by over-high tobacco duty and, in turn, by smuggling provides a much more credible explanation of the rise in smoking prevalence than anything to do with advertising. But that leads me to a further and important point. If, because of the Bill, the tobacco companies are no longer able to compete with each other through advertising, only one means of competition will be available to them—competition by price. My prediction is that we shall see price wars breaking out between brands and an influx of cheap, foreign imports of cigarettes. If it is accepted that the biggest single determinant of cigarette consumption is
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price, then, as my noble friend Lord Glenarthur pointed out so ably, we could see the worst possible situation: that is, consumption rising.
Those are the reasons why my doubts about the Bill remain. As regards smuggling, it could be argued, and has been argued by Ministers. that it should not be a case of either/or. The Government believe in stopping advertising as well as clamping down on bootlegging. That would be a defensible position if one could be certain of the initial premise: that an advertising ban will have a beneficial effect on current smoking prevalence. For the reasons I have given, I do not believe that that will happen.
Therefore, if the Government get their way, as they no doubt will, we believe that it would be appropriate to include a sunset clause in the Bill to take effect after, say, five years. Five years should be long enough in which to determine whether or not the ban has had the effect that the Government now predict. If the Government are proved right, and I am wrong, then there would be absolutely nothing for Ministers to fear. The Act could simply be renewed without political disagreement.
This is an issue that we would wish to pursue in Committee, along with a number of other concerns. We are concerned about the preferential treatment accorded in the Bill to some sports to the detriment of others. We are concerned about the implications for certain international newspapers and other publications that may carry tobacco advertisements. We are very unhappy about Clause 7. We are very worried about the anomalous and unjustifiable effect of Clause 5(5) on Internet service providers. We deplore the reversal of the burden of proof about which my noble friend Lord Lucas spoke so compellingly. We have considerable criticisms of the provisions for brand sharing in Clause 11 which look set to disadvantage legitimate businesses marketing products wholly unconnected with tobacco. Those criticisms on Clause 11 are compounded by our doubts on its legality under EU law.
This is a Bill which, for all the sound and fury which accompanies it, will, I fear, do little if anything to advance the cause that is common to the Government and ourselves. It may even have the opposite effect from that intended. As such it is difficult to regard it as other than at best window dressing and at worst misconceived. It is, therefore, with a mixture of interest and a considerable helping of scepticism that I look forward to the Minister's response.
7.27 p.m.
Lord Hunt of Kings Heath: My Lords, it has been an interesting and wide-ranging debate. The first comment I wish to make to noble Lords is that this is not a witch-hunt against smokers. It is not an attack on freedom. It is a genuine effort to try to tackle the single greatest cause of avoidable death in the United Kingdom. The noble Lord, Lord Walton, underpinned the responsibility of Government to develop policies which can help to discourage people from starting to smoke and help those who want to give up.

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Perhaps I may say to the noble Viscount, Lord Oxfuird, that the Bill, of course, is not a stand-alone provision. It has to be seen as a key part of a much wider and comprehensive strategy to tackle smoking that was set out in the White Paper, Smoking Kills, which was published in December 1998.
I readily say to the noble Earl, Lord Howe, that we do not pretend that a ban on tobacco advertising on its own will deliver the Government's targets for reductions in smoking prevalence. But—this is crucial-—it will remove much of the tobacco industry's ability to undermine the impact of positive health messages with its own advertising and marketing.
This will mean that the 70 per cent of smokers who wish to give up will not be surrounded by sophisticated pro-smoking propaganda. The overall effectiveness of our NHS smoking cessation programme, and the impact of our tobacco education campaign, will be enhanced. The result will be more people giving up and better health in this country.
The noble Lord, Lord Geddes, questioned me on the European Convention on Human Rights. Ministers have certified that the Bill is compatible with those rights. Article 10 of the convention says that the right to freedom of expression,
"shall include freedom to … impart information … without interference by public authority".
However, the convention also provides that freedom of expression may be restricted by law for a number of reasons, including the protection of health. On that basis, we believe that the proposed restrictions on advertising for the protection of health are both necessary and proportionate.
We all agree on the common agricultural policy tobacco regime. Of course we contribute to the EU budget as a whole and not to any particular part. The Government strongly disapprove of the tobacco regime on health, expenditure and control grounds. I assure the noble Lord, Lord Tebbit, and others that we shall continue to press for progressive disengagement from that regime.
The noble Earl, Lord Howe, rightly said that we have to be sure that the ban will be effective. Any number of studies have been quoted tonight. As I said in my opening speech, absolute certainty cannot be provided. It was fair, open and honest of me to say that. However, I believe that there is sufficient evidence to show that advertising has an impact on consumption. I have already quoted some studies. I refer your Lordships to the World Bank, which suggested that the implementation of the original EU directive could have reduced cigarette consumption in the European Union by nearly 7 per cent. I also refer your Lordships to recent evidence from the US researchers Saffer and Chaloupka, who studied data from 22 countries and concluded that tobacco advertising increases tobacco consumption.
The noble Earl, Lord Howe, referred to children. University of Manchester researchers in the mid-1990s found that awareness of certain brands of cigarette was linked to an increased risk of the onset of smoking among 11 to 13 year-olds. I also refer him to a study of
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adolescents in California between 1993 and 1996, which found clear evidence that tobacco industry advertising and promotional activities can influence non-susceptible people who have never smoked to start the process of becoming addicted to cigarettes.
My noble friend Lord Tomlinson asked why the UK is not joining in the action being taken in the US. We have not ruled out attaching ourselves to the case, although we have ruled out joining in as a party to the action. There are other ways in which the UK can support the Commission's action. We are considering our options.
The noble Lord, Lord Lucas, asked about the Internet, as he often does. I recognise that regulating the Internet in one country is not easy. We shall continue to press for wider bans on Internet tobacco advertising in Europe and globally. The alternative to seeking to show a lead in the UK is to take no action and to leave this new potent technology to the tobacco industry to exploit. That is not a comfortable prospect. Understandably, the Internet is now the first choice means of advertising and communication for a wide variety of purposes, but it ought not to be an unregulated domain. The Bill will enable us to stop tobacco advertising on UK websites. We cannot prevent access to websites in other countries where it is legal to advertise tobacco, but we can take action against those facilitating such action in appropriate cases.
I understand that the representatives of Internet service providers have raised concerns about the Bill, as a number of noble Lords have pointed out. The question of whether ISPs are publishers or distributors is complex and there is no legal certainty about it. That is why the Bill was amended in Committee in the House of Commons to furnish ISPs with robust defences regardless of the opinion of any court. I understand the concerns that have been expressed. We are prepared to listen to those concerns and discuss them with representatives of the industry as the Bill proceeds through your Lordships' House.
The noble Lord, Lord Tebbit, and others raised the related issue of Clause 7. The clause gives the Secretary of State the power to amend any provisions if it becomes necessary to do so in consequence of any developments in technology concerning publication or distribution by electronic means. We do not propose to treat advertising by electronic means less or more favourably than any other forms of advertising. However, the sheer pace of technological change makes it very difficult to predict what new means of publishing or distribution might emerge. We think that it is right to cater for potential developments in this way. The Delegated Powers and Deregulation Committee did not object to the clause. We have no immediate plans to make an order under the clause. If and when it appears to be right to do so, the use of the power will be subject to the affirmative resolution procedure.
Lord Tebbit: My Lords, the Minister must understand the concern that it is unusual, to say the least, to allow primary legislation to be amended by

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regulation. We have almost got used to the fact that that is being done under the 1972 Act of accession. There is not much that we can do about that unless we denounce the Act. The Minister should understand that many of us do not think that arguments of convenience and speed should override the precedents of the way in which we legislate.
Lord Hunt of Kings Heath: My Lords, I understand the point that the noble Lord has raised. It will be a matter of great interest to your Lordships. I also believe that when we legislate we sometimes need to anticipate future developments. That is justified when it comes to the Internet. The use of the affirmative resolution procedure is surely a safeguard that allows noble Lords to debate the issues. It is noticeable that your Lordships' House has started not only to debate, but also to vote on such regulations. That is a big change, even in the very short time that I have had the honour of being a Member of the House.
Sponsorship raises some interesting arguments. We have heard two contrasting views on what action the Government ought to take. My noble friend Lord Faulkner would like an earlier end to tobacco sponsorship, but that view was not shared by the noble Baroness, Lady Anelay of St Johns. We have said that tobacco sponsorship will end by 2006. We are considering the most effective transitional arrangements. Our intention remains to end existing tobacco sponsorship for most sports by July 2003 and for global sports, as the noble Baroness has said, by October 2006. We will consult on the draft regulations, which will cover the timing of the end of sponsorship and the conditions under which it may be continued for a period.
We believe that July 2003 is reasonable for most sports, thus giving them considerable notice of the Government's plans. They have been offered assistance and advice from the Department of Culture, Media and Sport's tobacco task force. I say to the noble Baroness that the task force stands ready to help sports to find themselves new sponsorship. Many sports have taken advantage of that help; others have chosen not to do so.
I am aware of the issues that the noble Baroness raised specifically in relation to the British Darts Organisation, which argues that it should be recognised as a global sport. She will understand that I do not want to pre-judge the consultation process during which that organisation can make representations. I believe that the task force is useful. It is not a gesture. I urge the British Darts Organisation to engage in, and take advantage of, discussions.
So far as concerns the other issues that the noble Baroness raised, I should point out that the provisions under Clause 10 do not prevent a tobacco company giving money to support an event provided that, in return, tobacco products are not given promotion. In the circumstances that she raised, I do not see any inhibition to the continuation of the type of support suggested by the noble Baroness.
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It is also worth pointing out to noble Lords that a report, published by International Marketing Reports, entitled, Driving Business Through Sport, revealed that in Europe a massive £4.03 billion a year is accounted for by sports-related endorsements, with 5 per cent of that amount coming from the tobacco industry.
My noble friend Lord Faulkner referred to loopholes and felt that the Bill would not go far enough; he would prefer there to be no tobacco advertising at point of sale. The fact is—I shall return to this point in a moment—that tobacco is a legally available product. There is no question of that, and there is no question of the Government seeking to change that position. Therefore, a balance must be struck in seeking to end all advertising and promotion while still, for example, allowing the adult smoker to see the information needed to make a purchase.
My noble friend Lord Haskel asked about regulation. I confess to him that I am the Minister responsible for better regulation in the Department of Health. I have suffered the Star Chamber process, defending my department's performance before Mo Mowlam, and I can tell him that it was as uncomfortable an experience as he suggested. However, in the end, the regulations, particularly those in Clause 4(2), very much safeguard the position. They allow for a certain amount of information to communicate the availability and price of the products on sale. I believe that at the point of sale that is a necessary balance to the overall ban.
So far as concerns the Scottish Parliament—this matter was raised by the noble Lord, Lord Glenarthur—ECHR legislation applies to the whole of the UK and, of course, Westminster is subject to the Human Rights Act. However, in this instance, I do not believe that that is relevant to the question of why Scotland has regulation-making powers in this Bill. It simply arises from the fact that there may be issues particular to Scotland in connection with advertising in shops; for example, where the Scottish Executive is being given the power to regulate for local conditions if that is necessary, and if it is felt that that is the right way forward.
A number of questions were raised in relation to fiscal policy and smuggling. The Government are, and continue to be, committed to maintaining a strong fiscal policy as a way of deterring people from smoking. I listened to my noble friend Lord Mason, the noble Lord, Lord Naseby, and other noble Lords, who referred to the issue of tobacco smuggling. I am the first to acknowledge that this is a major issue which must be tackled. However, the Government's view is that that should be done through intensive measures to make it much more difficult to smuggle those goods.
Noble Lords have already referred to the measures that we are taking. I believe that they are already having an effect. In the nine months following the launch of a new strategy in March 2000, Customs seized over 2.1 billion cigarettes and is confident of a better performance as extra officers and x-ray scanners

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come on line. Smuggling is a problem for many countries; for example, Italy. That country has low duties but still has problems with smuggling.
The noble Viscount, Lord Oxfuird, asked about voluntary agreements. It is true that smoking rates fell steadily for many years under governments of both parties during the time of some of those voluntary agreements. However, as noble Lords suggested, since the early 1990s we seem to have reached a plateau. I say simply to the noble Viscount that that suggests to me that we need to adopt a new approach. That is why we believe it is important that, as part of our army of measures, there should be a ban on tobacco advertising.
My noble friend Lord Hardy of Wath asked about passive smoking. I believe the evidence shows that prolonged exposure to environmental tobacco smoke is harmful. That has been borne out by many medical studies.
I turn to the issues of freedom, free speech and the issues that were raised at the start of our debate and threaded through it. The noble Lord, Lord Tebbit, does not like smoking. As noble Lords will know, my problem is that I do like smoking, and I am making yet another effort to give it up. I am not a health fascist. I do not present this Bill as an attempt to curb the freedom of smokers. I accept that restricting the advertising of illegal products is not a step that could be taken lightly. However, I believe that commercial freedom of speech must be weighed against the unique public health dangers posed by tobacco. We are talking about a product which is extremely addictive. It is a product that most of its consumers started using before the age of 20. The Government are not trying to ban smoking, but we are removing the tobacco companies' right to advertise a lethal, addictive product.
I listened with a great deal of interest to my noble friend Lord Stoddart, and I have given careful consideration to the Bill which received its First Reading immediately before this Bill. The Government will not be supporting his Bill.
Lord Dubs: My Lords, perhaps my noble friend will allow me to take his reference to my noble friend Lord Stoddart as a cue to ask him about another point. My noble friend Lord Stoddart suggested that my arithmetic was wrong with regard to the overall effect of the number of people who died from cancer or cancer-related illnesses. Will he confirm that a death rate of 120,000 a year represents 10,000 a month, 333 a day and, therefore, between two and three every 10 minutes? That was the point that I made in my speech.
Lord Hunt of Kings Heath: My Lords, together with geography, I am not very good at maths. However, my noble friend's figures sound right to me.
Lord Stoddart of Swindon: My Lords, I am grateful to my noble friend for giving way. I want to apologise to my noble friend Lord Dubs for doubting his prowess at arithmetic. He is absolutely right. It seems
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to me that I should be very much better off if I handed my accounts over to him. I should be twice as well off as I am.
Lord Hunt of Kings Heath: My Lords. surely the difference between smoking and drinking is this: we know that all smoking does harm. It is my understanding, belief and experience that responsible drinking does no harm; indeed, some consider that it does good, particularly bottles of your Lordships' claret, which we enjoy from time to time.
Are the Government going to legalise cannabis? It has been suggested that two different threads go through our debate and society. The Government's position on cannabis is clear and unchanged: we continue to recognise that the drug can have serious health and social effects. The cross-government antidrug strategy sets clear targets for reducing the availability and use of all illegal drugs. Long may that continue!
The noble Lord, Lord Skelmersdale, asked why Clause 4(1)(d) was not hybrid. My understanding is that hybridity arises where persons in a class are treated differently without good reason. The Bill has been vetted for hybridity by the House authorities, who do not see that to be an issue. My understanding is that UK airlines constitute a genuine class. That is a big enough category to be a class in terms of hybridity and to ensure that no UK airline is treated differently.
Lord Skelmersdale: My Lords, I am extremely grateful to the Minister for that. I shall be the first to put him out of his possible agony. Would he be good enough to write to me—obviously, I do not expect a response at the moment—comparing what he has just said with the provisions in Clause 4?
Lord Hunt of Kings Heath: My Lords. I am very happy to do that.
We have had a very good and thorough debate. I conclude by echoing the words of my noble friend Lord Mason. There is a balance to be struck. We want tolerance for smokers and non-smokers. The measures that we have taken in relation to the Bill and to our tobacco strategy as a whole recognise that. We have not embarked on a moral crusade against smokers. We wish to help those who do not wish to start smoking: but, equally, we wish to help those who wish to give up smoking, and enable them to do so as speedily and effectively as possible. The Bill will help us to tackle the biggest source of preventable death and disease in this country.
Lord Stoddart of Swindon: My Lords, before my noble friend concludes, I have a question for him. He said that he would not support my Bill. It is not usual for governments to oppose Private Members' Bills. Can I take it that the Government will not actively oppose the Bill, in accordance with tradition?
Lord Hunt of Kings Heath: My Lords, I assure my noble friend that I shall be present at every stage of his

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Bill's passage and that I shall be happy to give comments as required. The Bill will no doubt proceed through your Lordships' House in the normal way.
On Question, Bill read a second time, and committed to a Committee of the Whole House.

Homes Bill
7.53 p.m.
Lord Whitty: My Lords, I beg to move that this Bill be now read a second time. The Bill is an important part of the Government's aim of ensuring that everyone has the opportunity and choice of a decent home. It complements the ambitious strategy set out in our April 2000 housing Green Paper and in December's follow-up statement, entitled Quality and Choice.. A decent home for all.
The Bill will help millions of householders in England and Wales by improving the home-buying and home-selling process and by strengthening the protection available to homeless people. It is a Bill that provides benefits: for people who are selling or buying their homes; for people who are seeking help when they have become homeless or who are threatened with homelessness; for people in housing need who are applying for social housing; and for existing tenants seeking to move within the social housing sector.
Before I describe in detail the provisions of Part 1, let me first explain the problem that needs to be addressed. Currently, we have one of the most inefficient systems for buying and selling houses in the world. That is not just rhetoric or an opinion; it is borne out by our research. For every three transactions that proceed successfully, one fails. That means that up to half a million transactions each year are aborted. That carries with it huge costs in wasted fees paid to solicitors, surveyors and lenders. We estimate the cost of aborted transactions at about £350 million a year. If one includes the cost of delayed transactions, the figure is higher. Those figures do not begin to reflect the frustration and misery suffered by those who are affected.
We do not intend to allow that to continue. Apart from the personal distress that is caused to many, an inefficient housing market is bad for the economy and for our society. Our system is in desperate need of reform.
The Bill will require anyone in England and Wales who is marketing a residential property to assemble a seller's pack before putting the property on the market. The information in the seller's pack is important to the home-buying decision. However, under the present process it is not available to buyers until after they have made an offer and had it accepted by the seller. That is one of the main reasons why so many transactions fail. A staggering 28 per cent of transactions fail after an offer has been accepted. Many more transactions have to be renegotiated as relevant information—for example, about a house's
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condition—becomes available later in the process. Under our proposals, that information will be provided up-front.
Seller's packs will include home condition reports which will provide important information on homes for sale and they will cover the general condition of the property and take account of its age, character and location, how energy efficient it is, and any major repairs or other matters requiring attention.
The reports will help sellers to make decisions about how much to ask for their home and give them the option of having any necessary work done before they market the property. The reports will also help buyers to make an offer that reflects the true condition of the property and to identify potential future repair or improvement work for which they should budget.
By providing information up-front. the whole process will become more transparent, providing earlier certainty for sellers and buyers and reducing the risk of problems that lead to failed transactions and abortive costs. That is only part of the story. Other non-legislative measures which we are pursuing to improve the home-buying and home-selling process will complement that approach. Those measures include encouraging better preparation by buyers, for example, in obtaining "in principle" mortgage offers before making an offer on a property; encouraging faster mortgage offers and local authority searches; promoting better use of information technology; and encouraging lenders and insurers to develop products that help and protect buyers and sellers.
All of those measures are based on the most thorough research ever undertaken into the housing market in England and Wales, and follow a comprehensive public consultation in 1998 and a successful pilot scheme in Bristol last year. Some noble Lords may have received briefing from professional and representative bodies such as the Law Society and the Council of Mortgage Lenders. We take seriously the concerns expressed by such bodies. I am prepared to explain in detail how our policies address any criticisms that concern noble Lords. Let us remember that we are asking people to change the way in which they have been doing things for many years, so it is not surprising that there is some nervousness in the professions. Their jobs will change as a result of the reforms.
However, the real test of the Bill is how it affects not professionals but consumers. I believe that it will benefit consumers. Crucially, the Consumers' Association also believes that. There are many conveyancers, lenders and estate agents who are embracing the new approach enthusiastically and see it, rightly, as an opportunity for them, not a threat.
The proposals in Part 1 are based on extensive public consultation, research and piloting of the scheme. We will continue to work with the key professionals and consumers' representatives in developing the detail of our proposals, especially the home condition report and the supporting certification scheme, so that seller's packs can be introduced in 2003.

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The proposals in Part 2 will extend the homelessness safety net, promote a more strategic approach by local authorities in preventing and managing homelessness and assist local authorities in offering greater choice to those seeking social housing. Our proposals are designed to protect the vulnerable, promote choice, create sustainable communities and tackle social exclusion.
Each year local authorities and other agencies expend huge efforts helping people who have become homeless through no fault of their own. One of the most important changes we want to bring about through the Homes Bill is to focus a greater amount of effort on the prevention of homelessness. Our proposals will require local authorities to adopt a more strategic approach to tackling the causes of homelessness and preventing its recurrence.
The Bill will require local authorities to review homelessness in their area at least every five years and put in place a multi-agency strategy for preventing and dealing with homelessness. That will require close consultation and co-operation between local authorities, registered social landlords and other voluntary and statutory agencies. They will be encouraged to work together to assess the extent and causes of homelessness in their areas, to identify the most effective solutions and to ensure that adequate advice, accommodation and support is available for those who need it.
Within local authorities, the Bill will encourage a more co-ordinated approach by requiring housing and social services departments to take the homelessness strategy into account when carrying out their responsibilities. We are also strengthening the existing safety net by removing certain measures imposed by the Housing Act 1996. These include the two-year limit on local authorities' duty to provide accommodation for unintentionally homeless households and the restrictions on authorities' use of their own housing to provide short-term accommodation for homeless people. Those rules are unnecessary and can limit an authority's ability to find sustainable housing solutions for homeless people.
The Homes Bill will ensure that local authorities offer everyone who is unintentionally homeless and in priority need somewhere suitable to live until they find a long-term home. Our proposals will give existing social tenants and new applicants improved rights and will facilitate greater choice for applicants seeking social housing that meets their and their families' needs.
Extension of choice to everyone is central to this Government's policy. I was very pleased last week when my right honourable friend the Minister for Housing and Planning announced that 27 local authorities would be funded to explore a variety of choice-based letting schemes over the next two years. Those pilots demonstrate real progress by local authorities and registered social landlords in working together in extending choice to existing tenants and new applicants for social housing.
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Our proposals for protecting homeless people go beyond the Homes Bill. We are proposing-—by order under the 1996 Act—to extend the categories of homeless households who have a priority need for temporary accommodation. Evidence demonstrates that a high proportion of homeless people who end up sleeping rough come from institutionalised backgrounds. We are adding to the priority need groups such people who are homeless and vulnerable as a result of having spent time in local authority care, in prison or in the Armed Forces. There are three further groups we are adding to the priority need groups. Those are homeless young people aged 16 and 17; those aged 18 to 21 who have previously been in care; and people considered vulnerable as a result of fleeing domestic or other violence including racial violence. I hope your Lordships will agree that we must ensure a proper statutory safety net for vulnerable people, to protect them and to help them back to a settled way of life.
This Bill, taken together with the broader economic and social policies, the substantial increase in capital investment in housing and the wider policies set out in the Government's housing Green Paper, will help us to ensure that everyone has the opportunity of a decent home. I commend the Bill to the House.
Moved, That the Bill be now read a second time.—(Lord Whitty.)
8.4 p.m.
The Earl of Caithness: My Lords, we are all grateful to the Minister for his clear explanation of the Bill. Let me at this stage declare my interest as an estate agent in central London. I helped to found the firm in 1995. I have been a surveyor since I started in the land agency profession aged about 21.
I want to concentrate on Part I of the Bill, though if it proceeds I shall want to say more on the rest of it. Much of Part I is to be welcomed. Most responsible estate agents are already undertaking most of what Part I offers. If we are instructed to sell a house., we warn the solicitor that a sale is proposed and ask that the papers be prepared. That process is naturally speeding up with the advance of technology and does not need a Bill to encourage it.
I want to mention one comment the Minister made about the pilot scheme in Bristol. Everybody I have spoken to about that scheme said it was the most useless waste of time and a complete disaster; that it was an unreliable pilot scheme and should not be used for primary legislation.
Unquestionably this Bill will change the dynamics of house buying. I do not object. I welcome the change. I agree that house buying takes far too long and I shall look at some of those points in a minute. But what the Bill will also do, which is a key matter into which very little research has been done, is alter the relationship between a client and the agent. At the moment if the noble Lord, Lord Whitty, instructs me to sell his house for him, I believe what he tells me about the house. I will not be able to do that in the future. I cannot share that trust with him because I will be criminally liable

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for anything that he tells me. Therefore everything he says will have to be confirmed in writing and signed by him. That will change our relationship enormously.
We must remember that when people move house they are facing perhaps the most expensive transaction they will undertake in their lifetime. For them to be confronted by an agent who says, "I am sorry, I cannot accept your word; you must put it in writing", will not get that relationship off to a good start.
What are the aims of the Bill? The Minister did not say that it was aimed to stop gazumping or "gazundering". That is one of the Government's policies. But this Bill cannot; in fact it will positively encourage gazumping because so many extra costs are being put on the vendor and he will be duty-bound to seek the best price that he can in order to recover some of those costs.
The Bill will help to speed up the process of buying and selling. I agree with the Minister in that regard. But that is happening anyway and it will not speed it up to the extent that he anticipates. Also, on that point, the Minister has possibly selected some of the wrong targets. There is nothing in the Bill about solicitors. Although agents may be to blame for some failed transactions, most of the failed transactions with which I have dealt are entirely the result of solicitors not producing documents on time, not answering letters on time and not fulfilling their duties. There is a wide discrepancy. Some solicitors are quite brilliant at conveyancing and others who take on the work to get the fees are not terribly good.
The Minister for Housing and Planning in another place said on 8th January,
"The Bill will help to ensure that most of the information needed by both parties—buyers and sellers—is on the table when marketing begins".—[Official Report, Commons, 8/1/01; col. 710.]
That is a misleading statement. It is not true and I shall turn to the reason for that in a moment. So that cannot be a reason for introducing this Bill. Nor do I think it will stop transactions failing—a point the Minister stressed when he introduced the Bill. Transactions fail for a variety of reasons and having the information available at the beginning of the transaction will not do much to dampen that statistic down.
Let me turn to the reason for my objection to part of Part I; that is, the work of the surveyors and the home buyer's pack—the seller's information pack. I object to it for a number of reasons. The surveyor cannot serve both the vendor and the purchaser. He acts for either one party or the other. To change that vital role and ask the surveyor to perform an independent role between the vendor and the purchaser when the vendor is paying the bill will place the surveyor in an impossible situation.
I differ with the Government to a large extent in relation to the home condition report. The noble Lord, Lord Whitty, said that it was a good document and told us most of what we needed to know when buying a house. That was also a point made by the Minister for Housing and Planning in another place. The
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document does not do that. That is the one thing that the home condition report does not do; it does not tell us where the major expenditure lies.
I hope that all noble Lords have seen a copy of the house condition report. It states that the services to the property, including electricity, plumbing, heating, gas and drainage will be subject to a visual inspection only and no tests will be applied. That is where cost is involved; that is, in the drains. There is an endless amount of settlement in houses in London. That would not be picked up in a home condition report. The report goes on to state that the home inspector will not be able to report in compliance with regulations relating to supply or operation of any services as that can only be ascertained by the application of tests. Similarly, the home inspector will not be able to confirm compliance with building or planning regulations.
A purchaser who accepts a home condition report could then fall foul of planning laws or building regulations and would incur considerable extra expense. He has been led to believe that this report will answer his questions. It will not. It is totally misleading to say that it will. The potential major costs of liabilities in houses are not included in a home condition report.
The home condition report is a simplistic little document. The surveyor has to give a report on the condition of various parts of the house, such as the painting or the look of the radiators. Such a report will be numbered from one to four. However, much will depend on the comment of the surveyor, which varies from very good to—I assure your Lordships—very poor indeed. The home condition report is a major defect in the Government's proposals. On that point I fundamentally disagree with my profession, the Royal Institution of Chartered Surveyors (RICS).
Let us consider the workload of a surveyor. It will probably take about half a day's work for a surveyor to carry out a home condition report. In a month of, say, 20 working days he will have done 40 surveys. Let us assume, quite reasonably, that he might expect five calls per survey from potential purchasers. He will receive 200 telephone calls, which he will need to return. He is not paid for that work. That is only one month's work. I am told that a survey will be valid for six months. The total number of calls with which he will be involved and which may require further research will be over 1,000. How will a surveyor possibly remember all those surveys without having to spend a huge amount of time looking them up to check what he said?
If a survey is valid for six months—I should be grateful for the Minister's confirmation of that—that is a disaster for a purchaser. The one thing that changes rapidly is the structure of one's home. If a survey is carried out in October and we have a good gale in November and a few tiles come off, the surveyor's report is wrong; it is out of date. Settlement due to global warming can happen at any time. Yet a purchaser and a lender are encouraged to rely on the home condition report. All that will lead to a mass of insurance claims, which will push up costs.

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I turn to the qualification test for surveyors. I have spoken about that to a number of my friends in the building profession. They are horrified by the simplistic nature of the test they have been asked to undertake which, in their opinion, devalues the profession. I agree. I have been a surveyor all my working life. I could produce a home condition report, but I would not advise a single one of your Lordships, as a purchaser, to rely on it. When I bought my own property I obtained my own survey and am glad I did so. It revealed items which would be noticed by a professional surveyor looking in depth, but not by a surveyor producing a home condition report. That will not speed up the process. It will lead only to further antagonism.
Can the Minister tell us whether or not the surveyor will value properties? At present it is usual for that to be done by the lender's surveyor. If a vendor's surveyor is asked to do a valuation of a property, there will be a complete distortion of the housing market. That is the agent's job; to take into account the supply and demand, among other things, which the building surveyor will not do.
Another crucial point is the independence of the surveyor. Far too many agencies have their own in-house surveyors who will not be at arm's-length from the vendor or purchaser. It will be those surveyors who will recommend a particular mortgage company. The whole process will revolve around that estate agency getting fees from the mortgage company and the life endowment policy. That is an area which needs to be considered. What happens if the property does not sell? The Government are forcing a vendor to pay a surveyor upfront. If the property does not sell, that person will be discontented by what has happened and by the extra cost to which he has been put. Those are my main concerns on that subject. The rest of the proposals I could live with. They need tinkering, but we shall come to that if the Bill progresses.
I turn briefly to other problems in the same area. What about the problem of low-cost houses? I know that it is not true of central London, but in many parts of the country houses have been sold for as little as £2,500 or £5,000. Yet a building surveyor's charges will be around £500. That is a huge amount for somebody in those sort of properties to have to pay upfront. If we were to exempt the lower end of the market, would we not be classing this country into two tiers of citizens; those who can abide by what the Government want and those who are unable to do so? I wonder whether the Minister has considered the hybridity potential of bringing in two tiers and exempting the lower tier.
I move to the other end of the scale; that is, high-cost housing. Some of our clients have specifically asked us not to advertise a property or to prepare details but to sell it quietly. That may be for all sorts of reasons, perhaps concerning family or security. In future, we shall riot be able to do that. Their position will be significantly jeopardised. Before we can market the property we must have a seller's pack, which will be available to anybody. We shall not be able to market those properties in the way we have successfully done to date.
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What about people with low or negative equity? The proposal for having to first pay for a costly home buyer's survey will lead only to more evictions because people will be unable to pay. The Bill also requires there to be no pre-sale information. That is a key part of the housing market at present. Let us suppose that the noble Lord, Lord Whitty, instructs me to sell his house. Let us also suppose that I know the very person who wants to buy it, but he is speaking to somebody else about another property. I would he unable to go to him and say, "I know that your ideal property, the one that you really wanted, will be coming onto the market in a month's time, or a couple of months' time." If I did that, I would be a criminal.
I believe that it is wrong to make agents responsible for what is legitimately the work of solicitors. The agent will become a criminal for not having the right title deeds. That is very much for the solicitor. I cannot ring up a mortgage company and ask for the title deeds to properties for sale. I instruct a solicitor to do that on behalf of the vendor. To put the agent in that sort of position would cause all sorts of trouble in future.
Finally, the idea that private sellers will be criminalised when they get things wrong introduces a new aspect of law. Many people believe that we agents are expensive and cannot market properties in the best way; that they can do so better themselves. I fully respect that; they are entitled to do that. However, under the Bill, people who do that will become criminals if they have not complied with every part of the law. It is no good saying that it will be up to the weights and measures departments of the local councils to be reasonable because we know how unreasonable they can be.
Part 1 of the Bill contains many potentially good measures which can help a long drawn-out process which is frustrating to many people. However, I believe that the Government are wrong in respect of the home buyer's survey. They are wrong in other areas and in many respects are targeting the wrong people. I advise every vendor to continue to get their own survey in order to protect their own interests. I strongly recommend that everyone uses solicitors for the legal work. As so many house sales are part of chains a solicitor with particular knowledge is required to hold that together and deal with the matter in the best way. None of those proposals will speed up the process as we would want.
I know that the noble Lord, Lord Whitty, is a reasonable man and I hope that he will take the Minister for Housing to one side and say, "Look, what we have got is a totally unworkable proposition. It will result in a lot of extra costs and a complete seizure of the housing market. Why do we not rethink it through and not take the Bill through a further stage in this Parliament or in another Parliament?".
8.22 p.m.
Baroness Maddock: My Lords, as March began I wondered whether I would ever have the opportunity to make a speech on the Homes Bill. I had understood that the Government were anxious to get the Bill on to

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the statute book. Indeed, they timetabled it through the other place after Christmas, but still it did not arrive in this House. I remember that in 1996 I heard the present Minister for Housing, Planning and Construction, the right honourable Nick Raynsford, promising that repealing the worst aspects of the Housing Act 1996 would be an absolute priority for any incoming Labour Government. Here we are, four years later. What is worse is that as we have no idea what will happen in the next few weeks we do not know whether the Bill will go any further.
In another place and more widely, we on these Benches have supported the review of the homelessness legislation in Part 2. We have also given our support to the intention in Part 1 to improve the speed of transactions in buying and selling homes. However, as I believe that there is a more pressing need for Part 2 than there is for Part 1, I intend to deal first with that part.
Part 2 had its beginnings in the 1970s when the nation was appalled by the picture of homelessness portrayed in the film "Cathy Come Home". In 1977, the late Liberal MP Stephen Ross, piloted a Private Member's Bill through Parliament which became the Housing (Homeless Persons) Act 1977.
In 1996, I had the good fortune—perhaps I should say misfortune—to try to defend and prevent legislation undoing the intentions of that Bill. Therefore, I particularly welcome the repeal of some of the worst aspects of the 1996 Act with regard to homelessness. I also welcome the extension of the categories who will be helped by the Bill to young, vulnerable people and to those fleeing violence. In 1996, I spoke about those fleeing domestic violence and I am pleased that the Bill recognises the fact that anyone fleeing any form of violence should receive top priority help.
I know that noble friends on these Benches feel much the same as me and also welcome the provisions which will give more flexibility to local authorities to determine their lettings policies. They will be able to have policies which best suit their local circumstances. We also welcome the requirement for local authorities to draw up a homelessness strategy. We as Liberal Democrats have long thought that a good idea and would rather go further. That is demonstrated in Liverpool where Liberal Democrats have a successful strategic housing partnership which is set up across all the housing partners in the city to plan policies across all tenures.
As regards homelessness duties, we welcome the fact that once again local authorities will be required to find permanent accommodation for homeless families. The 1996 Act took away that responsibility, resulting in increases in the number in bed and breakfast accommodation. That has been condemned on all sides of the House. At that time, not only were local authorities unable to look after people for more than two years, they were not allowed to use their own properties to do that.
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We recognise that the private sector may still be used to help people in housing need. That is why we are particularly disappointed that the Bill contains nothing about the regulation of houses in multiple occupation. I know the arguments relating to that and I am sure that the Minister will tell us that provisions are on their way, but four years is a long time.
The Minister will know that many issues continue to concern us on these Benches. Given that we know not what will happen to the Bill after today, I shall go into those issues in more detail than I would normally at Second Reading. Some concerns are shared by organisations in the legal profession which give advice to homeless people, those who work in providing housing and those who work with homeless people. However, in another place the Government promised that they would examine some of the concerns that I shall raise. I shall deal with the last first.
It is vital that the statutory framework is always clear and robust so that it does not prevent local authorities denying people access to social housing in justifiable circumstances. In another place, the Minister stated that he did not believe that priority in allocation should be removed, for example, from people who were likely to be subject to a suspended possession order. I know that he did not intend that to happen and I hope that the Minister will confirm that, despite the difficulties, the Government will bring forward an amendment to address that issue.
The second point which the Minister in another place promised to examine was the requirement for a local authority to notify homeless applicants of their right to review and the time limit in which they can have that review. Those requirements were included in the 1996 Act and we believe that they should appear on the face of this Bill.
Finally in this part I want to deal with the power of the county court in relation to appeals on homelessness decisions. My honourable friend the Member of Parliament for Bath, Don Foster, tabled an amendment in another place which would direct a local authority to accommodate a homeless applicant pending decisions of appeal. At present, that power is in the hands of the High Court and it requires applicants to take out judicial review proceedings. Solicitors who deal with that will confirm that it almost never happens as it is greatly discouraged. Therefore, I look forward to hearing the Minister's response.
We shall want to return to other issues if the Bill moves to later stages. One such issue is the definition of suitability to be a tenant. The issues are controversial but we know that housing benefit does not always run smoothly and that tenants may incur a small amount of arrears through no fault of their own. Yet under this legislation the local authority can use that as an excuse to say that the tenant is not suitable. It is possible to change the legislation to do away with that.
We welcome the fact that under the Bill one particular category is to be helped: non-priority homeless people. That category has had some help

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from local authorities. and that is to be increased under the Bill. But Shelter has recently produced a report which looks specifically at what has happened to single people. It is quite clear that although many authorities make an assessment of the needs of people, the wording of the legislation, which states that they have a duty to make such inquiries as are necessary, is not the same as a requirement to carry out an assessment of need. It would not be too difficult for the Government to change the legislation.
Another area of concern is the 21-day limit for people who appeal against decisions about their homelessness. As to this and the other point that I have made, these Benches, Shelter and the Law Society believe that a period of 21 days is not enough for vulnerable people who find it difficult to deal with bureaucracy.
Just as there is a problem of accommodation during appeals, there is also a problem during reviews, and it would be helpful if local authorities had a duty in this respect. One of the other matters about which I felt strongly when I was a Member of another place was the time during which people had to say "yes" or "no" to any accommodation that they might be offered by a local authority. At present, I believe that the limit is 24 hours, but it should be a minimum of three days. If people say "no" that is their last chance and they will not get anything else. I believe that it is unreasonable to expect them to make that decision in that time.
One other issue which has been raised by my honourable friend Don Foster is the role of registered social landlords in helping local authorities with their duties under the Act. This is a fairly contentious matter. Registered social landlords like their independence and do not want local authorities to be able to control 100 per cent of their lettings. But we know that that can be a problem as there are more and more large-scale voluntary transfers of local authority housing to registered social landlords. It is important to ensure that there is a balanced approach which is not to the disadvantage of vulnerable homeless people, which is what this legislation is all about. Many registered social landlords are regulated by the Housing Corporation, and in that respect I look forward to the contribution of the noble Baroness, Lady Dean of Thornton-le-Fylde.
I believe that there is a wide consensus among a number of bodies—the National Housing Federation, Shelter, the Chartered Institute of Housing, the Local Government Association and the Association for London Government—that Part 2 of the Bill should be enacted. We welcome the new powers and duties to assist homeless families and vulnerable people, but the Bill does not address how local authorities will help people in areas where social housing is under immense pressure at the moment, particularly in London and the South East where house prices are so high that for many they are unaffordable. Tonight I do not have time to go into how we would like to see that matter tackled.
I turn very briefly to Part 1: the seller's pack. My noble friends Lord Goodhart and Lord Phillips of Sudbury will speak to this matter in much more detail.
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I make three observations. First, we believe that the pack will not achieve the original aim of the Government; namely, to deal with gazumping. Secondly, as has already been said, the pilot project undertaken is not sufficient to base legislation on it. Thirdly, the requirement for the seller's pack to contain a seller's survey, which is backed up by criminal sanctions for non-compliance, is totally unjustified. Practitioners on all sides believe that that will be very detrimental to house-buying. One positive aspect of the seller's pack that I applaud—I refer to my own particular interest—is the requirement for inclusion of the energy efficiency of the building.
I apologise for speaking at some length but, given the uncertainty of the future stages of the Bill, we on these Benches want to record matters at Second Reading that normally would he dealt with in much more detail in Committee. I sincerely hope that the parts of this Bill which deal with improving the provision for homeless people reach the statute book before a general election, but I do not feel at all the same about Part 1 which is concerned with the seller's pack.
8.36 p.m.
The Earl of Listowel: My Lords, I join in the last wish of the noble Baroness, Lady Maddock, that Part 2 reaches the statute book before the next election. The sooner it helps people, the better. I declare an interest as a commercial and domestic landlord. Today more homeless households than at any time since the late 1970s are in temporary accommodation. The number in temporary accommodation at the end of December 2000 was in excess of 70,000, over 40,000 of whom were located in London. Most of those households comprise families. The number of homeless households in bed and breakfast in London alone is over 7,000, and that number has doubled in the past two years.
Homelessness harms children. Children suffer greater sleeplessness and disease and their education is often less successful, partly because they are moved from school to school. Their diet is often poorer. Your Lordships may remember my description of a visit last year to a family living in Newham. That family with four children under the age of 11 had been in bed and breakfast for 12 months and had lived on snacks and one takeaway meal per day.
Homelessness harms adults. Homeless adults are 20 times more likely to contract tuberculosis. Homelessness overwhelms, or reduces, the resources of the National Health Service. Homeless people find it hard to keep a GP and, therefore, are far more likely to use the accident and emergency services of hospitals.
When young people run away from home, leave local authority care incapable of looking after themselves, leave prison with nowhere to go, or are pushed out of the family home prematurely, they are vulnerable. Most young people do not leave home until about the age of 22. Boredom, hunger and peer pressure may encourage those young people into

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opportunistic crime if they are on the streets. Similar factors, and possibly their own family history, may attract them to drugs. Occasionally, they may be drawn into the sex trade. Once on the streets, young persons can find the ethos much to their taste. I remember two young women who looked back fondly on their filthy, cold squat because of the camaraderie they had enjoyed there. The street can provide a kind of family to those whose experience of family life has been lacking.
It makes sense to minimise homelessness, with all its adverse effects, by anticipating it. That is why I applaud the introduction of a duty on local authorities to produce a quinquennial homelessness strategy. For the past three years, Leeds has operated a similar strategy for its homeless young people. Joe Kent is the project co-ordinator. His plan examines the key issues. It makes clear the action to be taken to address each issue, and it indicates where that action will join with that of other initiatives, such as the authority's supported housing strategy.
The key areas are the assessment of housing needs; the supply of information; the impact of the use of heroin and crack cocaine; the special needs of black and ethnic minorities; the particular problems faced by young homosexuals; ensuring that young people living in bedsits in the most deprived areas and young people with mild learning difficulties do not lose access to services; preventing young people becoming homeless through school programmes and the development of a family mediation service; determining what support for young people is and which young people need it; and how to provide support over the weekends, the evening and in the lodgings of young people.
A homeless strategy would also include consultation with users. In Leeds the consultation revealed that one care leaver suffered repeated break-ins to his ground floor flat and would have felt more secure on a second floor or higher; that young people placed in tower blocks faced theft from other tenants within the building and that a security camera on the main door provided inadequate protection; that people seen moving in were targeted for theft; and that the caretaker in one block "keeps things better".
A homelessness strategy would encourage local authorities to prevent homelessness and support the homeless into having and keeping homes. That is so much to be welcomed. At this point I should like to warmly welcome the extension of priority housing need to homeless 16 and 17 year-olds, young people leaving care and other people leaving institutions.
I turn to the problem of benefit delays and the consequences for allocations of lettings. That is also dealt with in Part 2 of the Bill. In some local authorities, Islington and Hackney, to name two of the worst, there are frequently delays of months in processing housing benefit payments of any complexity. The Government are taking steps to address the current scandalous situation. Past attempts have failed. It seems possible that these delays will continue. Benefit delays bring small charities, such as the Single Homelessness Project,
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which has high exposure in failing boroughs, close to bankruptcy. They also cause great anxiety to many families in rental accommodation and can result in eviction. A person can find himself evicted for rent arrears. Those arrears can be either solely or, to a great extent, due to the local authority. Yet that person can be denied housing by a local authority because he has had rent arrears.
It is for that reason that we need to look carefully at the measures regarding suspension of allocations in the Bill and consider whether they unfairly penalise those without blame. We should also consider carefully the force of the new measures to provide advice and support to non-priority homeless people; for example, single people and childless couples. The quality and level of advice and assistance provided by councils is extremely variable and, in some cases, very poor. People are turned away without being interviewed. Assessments of vulnerability are inconsistent and, on occasion, contravene statutory guidance. Applicants generally receive no written notice of the authority's decision, nor are they informed of their rights to a review of that decision. I hope that in Committee we can amend the Bill to strengthen the duty of advice and support to non-priority homeless people.
As the noble Baroness, Lady Maddock, pointed out, the Bill omits the Government's manifesto pledge to license houses in multiple occupation. Such a licence would help to ensure that the lavatories and bathrooms were in a decent state and other matters which are very important to families living in that kind of accommodation—families with young children. The housing Minister has given a reasonable explanation for the delay but I hope we can now press on to that important legislation.
The second part of the Bill will help more of our citizens to feel part of a community, to be rooted and connected. I sincerely believe that the Government are, in bringing forward the Bill, reducing the extent of needless human suffering. The sooner people can benefit, the better. I hope that the second part of the Bill may enjoy the good will of all your Lordships.
8.46 p.m.
Baroness Dean of Thornton-le-Fylde: My Lords, I first declare an interest. I am chairman of the Housing Corporation, the government-funded quango that provides investment and regulates what is called "the social housing sector".
The Bill has been welcomed across all opinions. In meeting people on housing estates or organisations of various partners we work with. I have yet to find someone who feels that they do not want Part 2 of the Bill. There is a great deal of support for it. As the noble Baroness, Lady Maddock, said, it is true that people would like amendments and changes in some areas. But the general summing-up to the Government is, "Well done. This is a Bill which is needed. We should like to see it enacted as quickly as possible".
Part 2 of the Bill deals with homelessness, its prevention and the allocation of accommodation, which includes the key issue of choice. The Bill

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essentially puts the responsibility on local authorities to ensure that they have housing strategies and that they are carried through. I would be the first to accept that the housing organisations that we fund and regulate must have a key role in that. Approximately 1.5 million homes in Britain are owned by registered social landlords. Therefore, they are an important key factor within communities. It is to be hoped that the provisions in the Bill, when it becomes law, will be delivered. It is important that we work with not only local authorities but other parties. Many authorities are doing that. We welcome the requirement to have a homelessness strategy. Local authorities will have to set up such a strategy. Some already do. But it is important that we have one across the board.
The noble Baroness, Lady Maddock, said that the contentious issue was letting policy. She is absolutely right. That might be one of the few important areas where there is a slight difference between us. I cannot think of many others in social housing. I take the opportunity to put on the record how we are approaching this matter. We are not directly covered by the Bill. If one looks at last year's housing Green Paper and the restructuring of our organisation and our different approach to regulation and investment, they are all part of the whole. Homelessness is an essential part of that whole.
We are currently revising our 1997 Performance Standards and Regulatory Guidance. We give that guide to the housing associations that we regulate. We require them to meet those standards. We have already published a draft regulatory code which has been welcomed in the sector and by other stakeholders. We are also currently working on our Statutory Housing Management Guidance. That will be out for consultation in mid May.
The coming together of those developments will feed positively into what the Government are seeking and what the bodies supporting the Bill are seeking in Part 2. An essential requirement is not only a homelessness strategy but a prevention of homelessness strategy. We shall be working with local authorities to implement those strategies through the lettings policies of housing associations and how they sign up to the local policies with local authorities.
We shall also be looking at ways in which we can strengthen our regulatory requirements. For a housing association to be registered with the Housing Corporation it has to accept and apply, and confirm that it applies—we audit that housing associations apply—our regulatory requirements. Hand in hand with that, we are looking at our current funding conditions. 'We do not need to be convinced that the Bill is essential. We know that it is from our practical experience on the ground. When members of the Greater London Assembly—I notice that the noble Baroness, Lady Hamwee, is in her place—decided that housing would be their number one issue, we were delighted and asked whether we could join them in support of that work. We are working hard at the moment to develop that partnership. I am pleased to say that in the past few weeks we have funded the purchase of 740 previously privately rented flats to be
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brought into the social housing sector in London. We want to do more of that because housing in London and the South East is a serious issue.
Homelessness creates so much human misery that we cannot afford not to do anything about it. That is why the Bill is so helpful. We need to ensure through our funding and regulatory processes that housing associations not only work with local authorities and the other agencies but that they are delivering what is required.
Noble Lords have mentioned the various groups of people who fall into the homeless category. From my personal experience with the Armed Forces Pay Review Body, I know that, traditionally, former Armed Forces personnel have been one of those groups. This afternoon I attended—I hesitate to call it a seminar a get-together of 50 teenage mothers or prospective mothers. None was over 22 and many of them—I did not ask their age—looked very young. The Teenage Pregnancy Unit, which came out of the Social Exclusion Unit report, is working with us. It was delighted to hear about the Bill. Teenage mothers are a vulnerable group who need support. They need not only housing but supported housing. Of course, not only the mothers are vulnerable but the babies too. The whole area of homelessness affects so many in our population. It is essential that we do something about it.
Part 2 of the Bill also covers housing allocations. Choice was one of the core elements of the housing Green Paper. We welcome it. We have no impediment at the moment in applying the current regulatory framework that will implement choice. But we will be strengthening that with guidance. In parallel with that, nearly 300 housing associations have wanted to be involved in pilot schemes on choice. I have heard the arguments from some housing associations. They ask how on earth one can have choice when they do not have enough houses in an area to go round. There are in fact some interesting developments that one can apply. The William Sutton Trust is working on this issue. The Leicester Housing Association, in conjunction with Harborough District Council, has been working on a scheme for the past year. It is modelled on the Delft scheme in the Netherlands. Although it is in a highly populated area, choice has worked. It can work. The William Sutton Trust and other housing association partners are working on choice-based allocations in high demand areas. We shall be monitoring it and we are helping to fund it.
In the North West, Ashiana, a black minority ethnic housing association—it used to be called North British—is having discussions with Bolton City Council and seven other housing associations to put the whole of its 28,000 stock into a system where the tenants have choice. A good deal is going on and we welcome it.
We feel that the Bill is well balanced. We feel that Part 2 is welcome and that we have to respond to it. Working with social landlords, we shall be tightening our regulations and we shall be looking at where we invest. That investment will go increasingly to areas

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that have these strategies and work within partnership. We shall be monitoring that and ensuring that we deliver not only a welcome piece of legislation but one that will change the lives of so many vulnerable people in our community.
8.56 p.m.
Baroness Byford: My Lords, I have a certain sympathy with anyone who attempts to make the process of house buying more simple. However, I am aware that very often one person's gain is another person's loss. It seems to me that some of the provisions of Part I will cause just that.
The central issue is the seller's pack, which is to be made mandatory for homes being sold for owner occupation. The contents of that pack are to be laid down by the Secretary of State, who will have the power to control both the form and the detail of the documents, their provision and the circumstances of their variation. All the data in the pack will be of interest to potential buyers and the Bill supplies an indicative list of the sort of things the Government feel should be there.
Most of the rest of the first part is concerned with fixed penalties, criminal convictions, enforcement powers and offences. I have to say that I find it offensive that citizens of this country should be liable to a criminal prosecution for not following what will be the only procedure allowed for selling their home. No choice—none at all.
Perhaps I should have begun my speech by declaring an interest. I have two cottages that are out for rent. On a farm in Suffolk we made some land available for social housing when we were approached by the local authority.
The Bill makes no reference to time, and in buying and selling houses, time is often critical. The Radio 4 programme "You and Yours" yesterday, 27th March, had an item on house purchase through the Internet. In the course of the programme an Internet service provider stated that on average houses advertised by his company stayed on the Net for 10 weeks. He added that this accorded well with estate agent surveys which put the average time to sell a house at nine to 11 weeks.
An average is constructed from a range of values. An average time to sell a house may well be 10 weeks but the range from which it is taken may well extend from a mere few days to many months. It would be well to recognise that houses which do not sell quickly are often removed from one estate agent and given to another. In that sense the actual time taken will not be reflected in any average as the first agent may have it for, say, 16 weeks and the second for, say, 12 before it is sold.
An average does not reflect the differences in areas or in price levels. I have known times when houses in the lower price ranges sold easily while the bigger ones took a lot longer. Equally, I understand that houses in parts of London are sold in days while in parts of the East Midlands similar models can stay on the market for many months.
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Under the provisions of Clause 4, it will be an offence for an estate agent to tell anyone that a property is or may be coming on to the market until the seller's pack is available. My noble friend Lord Caithness referred to that. I believe that it should be known as a "buyer's pack" because everything in it appears to be designed for the advantage of the former at the expense of the latter. Moreover, the prohibition on telling anyone what is or is not for sale until the pack is ready can only add to the disadvantage. A number of friends and acquaintances of mine have sold their properties to people who visited estate agents before the details were available, but were sufficiently interested in the properties to go and take a look.
One of the items to be included in the pack will be a house condition report, similar to the present home buyer's survey and valuation. The Bill makes provision for buyers or mortgage lenders to sue a surveyor whose report is inaccurate or misleading. This is where the issue of time may become critical. If it takes nine to 11 weeks to sell the average property, and the agent may not tell anyone that the house is available for sale until the seller's pack is ready, how much time will elapse from the survey visit to completion? Would an average of 12 to 14 weeks seem reasonable?
What will happen when a deal progresses to the point where contracts are due to be signed before it becomes obvious that the buyer cannot complete for at least another 10 weeks? Will the seller have to pay for another condition report'? Will the seller be able to sue a buyer who wilfully or negligently fails to complete? As regards the business of buying and selling houses, I have never been sure about the process, but I can recall many instances involving family and friends where the proposed sale fell through at around the time the seller was due to sign the contract.
The Bill remains silent on the matter of how long the condition reports are to remain valid. It is also silent on when and how they are to be paid for. It is likely that a family moving for job-related reasons may be unable to raise the necessary fee for a house condition report. Equally, an elderly couple or widow whose home encompasses their entire savings may be forced to borrow money at interest in order to pay for the document, which many may feel will simply be replicated by the buyer.
The Leicestershire Law Society has written to me stating that it feels that both the buyer and the mortgage lender are unlikely to rely on the condition report. If that is the case—I suggest that the society has enough experience for that to be the case—the pack will simply cause a delay in the system. Delays will be occasioned by the double surveying of a particular property. The same letter from the society states that:
"The exercise in Bristol resulted in sellers shunning their packs".
Other noble Lords have referred to the Bristol trial. If that is the case, the Bill before us would seem to be yet another attempt by the Government to impose unwanted legislation on one section of the populace. If people are given the chance to use their intelligence

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and to decide whether the pack will be welcomed with open arms, why not simply give it legal status and let the market establish its use?
In its parliamentary briefing, the Law Society opposes the inclusion of a condition report on the grounds of the substantial extra expense incurred by the seller and a lack of trust in it on the parts both of the buyer and the lender. The Law Society strongly opposes the proposal to instigate criminal proceedings against those who, for whatever reason, fail to provide the pack. That suggests that the Government are unwilling to rely on market forces and indicates their lack of confidence in the measure.
Part 2 of the Bill tackles the issue of homelessness, to which other noble Lords have referred. The proposals seem to make sense, as far as they go, and I was pleased to see the inclusion of measures relating to young adults after they have left care, a matter to which the noble Earl referred in his remarks. However, the basic problem of where to house homeless people still remains.
Enforcement of standards of council housing occupation levels may do more than the Bill to house the homeless. But councils are being forced to produce strategies in all kinds of areas, and at times it is hard to imagine them being able to achieve anything in the face of the flood of consultations to which they have to respond, along with the strategies they have to prepare.
Perhaps I may turn briefly to the rural White Paper, which contained a section on affordable housing. I welcome the Government's recognition that there is a problem, but I should be glad of an assurance that they also recognise the problems faced by parish councils. It is quite common for parish councils to turn down planning requests for single large dwellings in villages on the grounds that three to four one or two-bedroom houses are more urgently needed and would be more appropriate. However, all too often their views are ignored at borough or district level and the planning restrictions overturned.
I have received reports of instances where both the parish council and the local planning department have recommended that planning permission should not be granted for a particular building, only to find that refusal overturned by councillors, most of whom are urban based. I know that on one occasion such a permission was granted by the casting vote of the planning chairman.
Another aspect to be borne in mind when considering rural development is that sites often comprise relatively small plots of land, to which the 25 per cent affordable housing rule does not apply. Will the Minister consider imposing a requirement to reduce the size of the plot to which the 25 per cent rule applies in rural areas and small villages? Paragraph 5.4.3. of the White Paper states that, currently, the derogation for villages comprising under 3,000 people is often not applied. If the Government target of 60 per cent of new ho using to be built on brownfield sites is to be met, I suggest that that should be made mandatory.
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When a developer uses a half-acre plot to construct a five-bedroom detached house with a triple garage, he often then houses no more than the number of people who otherwise would live in a two-bedroom terraced house, of which he might have been able to fit six on to the same plot. Those six houses might then have been used to retain in the countryside young couples who otherwise have to move to the towns. The houses could also be used to re-home elderly people who otherwise would occupy three or four-bedroom houses in the village.
Again, I refer to the White Paper. Under "Exception policy", paragraph 5.4.4. states:
"The exception applies to additional affordable housing made available only for local people in perpetuity. Local authorities who include an exception policy in their local plan can grant planning permission for small sites within or adjoining villages which would not otherwise be released for housing. Again we would like local authorities to make more use of the exception policy".
I hope that the Minister will refer to this when he responds.
Rural homelessness is often obscured by the fact that young people, in particular, go into towns looking for work and for somewhere to live, and to apply there for assistance. Similarly, old people left alone after the death, perhaps, of their spouse, will often move to town because their existing property is too big or too expensive and because there is nothing suitable for them locally. These are the very people who would use the village shop and the local pub and keep the heart and life in our rural communities.
I welcome the Bill with a slight cautiousness. Part 2 has much on which we can build but, as I have said, I have great reservations about some sections of Part 1.
9.9 p.m.
Lord Goodhart: My Lords, I intend to speak only to Part 1 of the Bill. I have no qualifications to speak on Part 2, but I have some qualifications to speak on Fart 1. Since I started practising at the Bar—which is now, I am afraid, a little over 40 years ago—property law has been a fairly substantial part of my practice. I served for two years, from 1998–1990, on the Law Commission's standing committee on conveyancing. Throughout the period of my practice delays in house buying have been a constant problem.
We have seen some improvements. These are mainly due to the extension of compulsory registration of title to the whole country. That has enormously simplified the investigation of a seller's title to the land. In the old days, the investigation of unregistered titles could take weeks. I remember acting in a case which concerned land belonging to a City livery company, where the main problem was that the title deeds had been destroyed in the Great Fire of London. It was a little difficult to find anyone who could swear to having seen the deeds before they were destroyed.
The main effect of registration of title is to shorten the interval between contract and completion. That can now, in effect, be as short as the parties want it to be. The continuing problem is the delay between agreeing a sale in principle and signing the contract.

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That was looked at very carefully and in great detail by the standing committee on conveyancing. We encouraged the Law Society's development of its transaction protocol, which provided for more information to be disclosed by sellers up front. Indeed, it amounts to something like a mini seller's pack. The use of the protocol has had a modest effect in speeding up house sales.
Speaking for myself, I would not object to a seller's pack containing information similar to that which is disclosable under the protocol being compulsory, although the enhanced use of information technology will mean that most of the relevant information will be accessed within a matter of minutes or even seconds. That is likely to start happening in two or three years.
I have three important reservations about Part 1. First, this is a minor, not a major, reform to the house-buying process and it cannot be expected to speed up house sales to any great extent. Secondly, remedies for failure to provide a seller's pack should be civil remedies, not criminal. Thirdly, I am afraid that I am not persuaded that the seller's pack should include a survey or, as described in the Bill, a home condition report.
Let me take each of these reservations in turn. First, the delay in producing the kind of information that would go into a seller's pack is not the main cause of delay in bringing house sales to a conclusion. The real causes of delay are the necessity to build up a chain of people willing to commit themselves to contracts for sale and purchase, and the delay in getting commitments from mortgage lenders.
Most buyers are also sellers and vice versa. Buyers do not want to buy a new house before they are certain that they can dispose of the old one because they cannot afford to hold two houses with the enormous interest costs involved in bridging finance. Equally, sellers do not want to sell their old house before buying a new one because they would then find themselves with nowhere to live and having to look for temporary rented accommodation.
There is a need to build up a chain and keep it together for long enough to get every member of the chain in a position to enter into a contract. That, frankly, can take weeks. There is no easy or obvious way around this problem, and this Bill certainly does not provide it.
The other main cause of delay is, as I have said, the delay in getting a commitment from lenders. These two problems are interlinked, because one of the reasons for delay in putting a chain together is the delay that some members of the chain may have in obtaining a mortgage commitment. Commitments by mortgage lenders could perhaps be speeded up, but again I do not think that the Bill is likely to do that.
I move on to my second reservation: the use of a criminal penalty. It is wholly inappropriate to enforce the obligations of the seller's pack through the criminal law. Criminal penalties would apply not only to estate agents—who could, I suppose, be expected to know the law—but to owners who market the
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property without using agents. They will be extremely worried by the possibility of acquiring a criminal record by failing to include the necessary information in the pack.
There is a simple and obvious method of enforcement which uses the civil law and not the criminal law; namely, to give any potential buyer, whether or not he or she becomes an actual buyer, the right to recover any costs reasonably incurred by him or her in obtaining information that should have been in the seller's pack but was not. That is the right way to proceed and I intend to table amendments to that effect if and when the Bill reaches Committee stage.
Thirdly, and perhaps most importantly, there is the question of the inclusion of the home condition report or survey in the seller's pack. I strongly agree with the remarks of the noble Earl, Lord Caithness. It can be argued that the inclusion of a survey in a pack could speed up the process. If a survey were produced as part of the seller's pack, it could be said that the need for the buyer to have a survey carried out will be eliminated. The buyer, it is said, will not have to wait for his or her own surveyor's report before signing the contract. It can be argued, secondly, that the inclusion of the survey in the pack will make the process cheaper because there will not be the problem of wasted surveys—that is, potential buyers pay for a survey but do not proceed because they are gazumped or because the survey is so alarming that they back out. The first of these arguments is only doubtfully true and the second is almost certainly untrue.
The seller's survey would speed up the selling process only if lenders were required or could be persuaded to accept the survey as a substitute for their own valuation. But there are real difficulties with this. First, the Bill as drafted requires the survey to deal only with the physical condition and energy efficiency of the property. It does not require the survey to include a valuation. Of course, to do so would increase the cost. But the valuation is exactly what the lenders need. I do not think that lenders can be required to accept the home condition report as a replacement for their own valuation. But the brief from the Council of Mortgage Lenders indicates that lenders are most unlikely voluntarily to accept the home condition report, at least as the whole basis of a valuation; it could at best be used as part of the process.
Therefore, the inclusion of a home condition report would have little effect on speeding up transactions. It could, however—and I believe that in all probability it would—increase the cost. At present, only some 30 per cent of buyers get a survey of any kind done. Most buyers simply rely on the mortgage valuation. That valuation does not tell them all that they would like to know, but at least it tells them that the property is not subject to defects so serious as to mean that it is not good security for the mortgage. As I have explained. lenders are likely to insist on a valuation. So if all sellers have to produce a survey and lenders insist on their own valuation, the cost of a house sale is likely to escalate sharply. I believe that that will involve forcing buyers who do not now require a survey, because they are prepared to take the risk, to pay a higher price for

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their houses through having ultimately to recompense the seller for the cost of having to produce the survey in the seller's pack.
I believe that there would be a greater cost because of the involvement of the lenders and their insistence on their own valuations, even if buyers who would now carry out their own surveys could be persuaded to rely on the seller's home condition report. That will certainly not happen unless the Bill makes it clear that a surveyor who prepares a home condition report will be liable to compensate any buyer for any negligent defects in the report. The Bill does not make that clear. General law suggests that a surveyor would not be liable to compensate a buyer unless the surveyor is preparing the report with a view to its use by a specific and identified prospective buyer. If the home condition report is to have any value to buyers the surveyor who prepares it must be liable to the buyer for any negligence in its preparation.
There are particular problems for sellers at the lower end of the market because survey costs are usually tapered so that a survey of a low-priced house costs more as a proportion of the value of the house than a survey of a high-priced house. I believe that a compulsory home condition report will increase and not reduce the cost of house sales. Frankly, it is no wonder that the Royal Institution of Chartered Surveyors is solidly behind this Bill. It will get from it the biggest bonanza in its history.
Part 1 of the Bill will not do as it stands. It will do little to speed up the process of buying and selling houses and too much to increase the cost. It will impose criminal penalties where civil remedies are more appropriate. It is certainly not something that ought to be rushed through in the dying days of the present Parliament.
9.2 p.m.
The Earl of Longford: My Lords, it is always a special pleasure for me to follow the noble Lord, Lord Goodhart, for a number of reasons. His father was a notable professor. He also had a unique method of serving at tennis. He used the reverse side of his racquet. I do not know whether the noble Lord has inherited that method. I have never seen anyone else do it. In addition, when I was going through the most humiliating period of my life having been invalided out of the Army with no honour, the noble Lord's father and mother took pity on me and looked after me until I recovered. I am enormously grateful to him.
I am not going to deal with Part 1 of the Bill. I shall not detain the House for long. I have two reasons for speaking. For once and beyond question, I am coming out on the side of the Government. Most of the time I agree with them and vote for them. One has to make a contribution. Here I am 100 per cent behind the Government. It is a good show, and well done the Government.
I think of the lines by Macaulay about the great scholar, Warren Hastings. He said that there was a deep treasure of wisdom too often buried in the earth and paraded with inelegant and injudicious ostentation, but still massive, precious and splendid.
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I am not in touch with the homeless in the way that applies to the noble Baroness, Lady Dean, the noble Earl, Lord Listowel, and others. I am out of date among the homeless. I have visited prisons so often and one cannot do that without being aware that many prisoners were homeless before they went into prison; and will be homeless when they are released. So there is some connection. My knowledge of the homeless goes back 30 years.
I had the great honour of starting the New Horizon Youth Centre over 30 years ago. It was very small to begin with: there was just myself and a secretary. We had a corner of an office provided. When she was in the office I had to sit in the corridor, and vice versa. We started at the lowest level. Nevertheless. today there is a staff of 18. Last year the centre looked after at least 1,200 people with, as I say, a staff of 18 and a good many volunteers. When St Peter asks, "Did you do any good down there'?", I shall reply, "At least I started the New Horizon Youth Centre". I am keen on caring for the homeless.
What do we make of the Bill? The New Horizon Youth Centre warmly welcomes the Bill for many different reasons. It provides a new vision from the top which we hope will be conveyed through local authorities. The Bill is not perfect. I hope that there will be an opportunity to amend it to make sure that local authorities look after the homeless in the way that is required by the Bill. However, on the face of it, no one could want more. There is an instruction to local authorities to do a great deal more for the homeless than they have ever done before. I warmly welcome the Bill.
9.26 p.m.
Lord Bowness: My Lords, I shall address Part 1 of the Bill, not because I think Part 2 is unimportant but because I know that other of my noble friends have, or will, deal with those issues. In dealing with Part 1 of the Bill I must declare an interest as a practising solicitor who practises in the high street and therefore deals with conveyancing on, sometimes I think unfortunately, a daily basis.
Everyone would like to see home buying and selling, in the words of the Government's Explanatory Notes, made,
"faster, easier and more consumer-friendly".
That includes the practitioners. Everyone considers it a stressful experience which is ranked with divorce and bereavement. It is an important matter to address. But it is equally a dreadful oversimplification to suggest that the seller's pack and the proposals in the Bill will deal with the problem. I endorse entirely what the noble Lord, Lord Goodhart, said about the failings of those measures in that regard.
If anyone thinks my scepticism arises from a desire to see the conveyancing process take longer than is necessary to ensure a higher fee income, I remind noble Lords that the majority of domestic conveyancing these days is undertaken for a fixed fee before the papers are seen in detail in circumstances where it is extremely difficult to increase that fee even by

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agreement with the client. Therefore problems that arise fall not only at the purchaser's cost but also at the lawyer's cost.
The noble Lord, Lord Whitty, referred to the survey that the Government undertook as part of the justification for these measures. I make two points in that regard. The noble Lord, Lord Whitty, told your Lordships that our system was the slowest of, I think, the 10 countries surveyed. He did not tell your Lordships that it was also the cheapest of the 10. The much vaunted Scottish system, which is supposed to enable transactions to proceed more quickly, is often held up as an example, but 25 per cent of Scottish buyers go into temporary accommodation and 14 per cent have bridging loans. I cannot remember the last time that I acted for anyone who was willing or able to take up a bridging loan.
The majority of solicitors already use the voluntary system known as the transaction protocol which was introduced by the Law Society in 1990. Without going into too many details, this means that when the draft contract is submitted by the vendor—or the seller in the non-technical language that we are now all urged to use in these matters—the draft contract and details of title are accompanied by a schedule of fixtures and fittings and the seller's own replies to a whole series of inquiries which deal with such matters as fences, maintenance, alterations and planning. Leasehold properties have an additional questionnaire.
As my noble friend Lord Caithness said, in good practice that is already done in good time. When the client starts the process and advises his solicitor, the property information forms are given to the client to complete and the draft contract prepared so that it is ready to go out when an estate agent has found a suitable purchaser.
I endorse entirely the reservations expressed by other noble Lords against making a seller's pack compulsory backed by the sanctions of the criminal law and enforced by local authority trading standards. Essentially it is a private transaction, and the largest transaction that most people undertake at any time in their lives, and it is totally inappropriate that it should be a matter for criminal proceedings. That will have no practical or useful effect.
Like the transaction protocol, the pack will also include details of the title, registered or unregistered—a property information form similar to that which is already supplied. In addition to that information, searches are now to be included. In addition, the leasehold pack is to include the leasehold information forms, which we already have, and an appropriate search where necessary against the management company and details of insurance. In both instances, there is to be the home condition report and the home energy report.
I hope that the Government will think again about the requirement that a draft contract should be included. If they proceed with the scheme, perhaps they will consider a summary of terms. The draft contract should be prepared by the sellers' solicitors
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and the buyers advised upon it by their solicitors before there is any chance that they might sign it. With great respect to my noble friend Lord Caithness, it would be particularly inappropriate if the seller's pack were to be prepared by estate agents—I understand that they may be responsible—who, as my noble friend reminded this House, in some instances not only sell the property but also secure the mortgage for the purchaser.
The home condition report presents real difficulties. Noble Lords have referred to them. I shall not go into the details of its inadequacies and the matters that it does not cover. My noble friend Lord Caithness dealt with that issue at some length. But we should remember that the proposal is that the report is to be relied on by both sides, and the lender. In briefing to your Lordships, the Council of Mortgage Lenders has said that it does not propose to accept that.
I believe that the cost will be considerable, on the introduction of the scheme, if it comes about, and once the claims start to be made against the surveyors. The cost of a seller's pack arising from the project held in Bristol was some £652. That is fine in theory, but it begs the question as to where the seller is to find the money at the beginning of the transaction. Alternatively, is it suggested that we should have a little more pro bono work and that the professionals involved should wait for payment at the end of the transaction and do the work on credit?
The inclusion of the searches in the home condition report make the proposals for the seller's pack significantly different from the practice followed by the vast majority of solicitors at present. But what difference will that make? Will the buyer rely on that home condition survey? He may have his own surveyor. He may object to the surveyor for the home condition report. He would be well advised to have a structural building survey in any event which will not be covered by this report.
We need to ask whether the issues addressed by the pack are those matters which cause the delay between the making of the offer and the signing of the contract. The seller's pack will still have to be examined by the buyer's solicitors before the buyer commits himself or herself. It is proposed that the pack can be prepared by anyone, including a layman—although it might be helpful if the lawyers were involved at an early stage. It is apparently unlikely that the Government will impose any serious conditions upon the quality of the pack. It has already been stated that we do not know what the lifespan of the pack will be. Will the surveyor's report last for six months? There are no proposals about that. If there is to be a cut-off date, will the sellers incur another cost when they have not sold their property? Those are real questions for real people when they come to sell their real home and not a matter of academic debate.
The factors that cause delays arise after the submission of the documents. I shall give the House a random selection of problems that have arisen when the documents are examined between the making of an offer and the exchange of contracts. No doubt they are

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dreadfully boring compared with a glossy seller's pack with an agent's logo and an advert for insurance on the front.
Delays can be caused by the need to establish whether a road is to be adopted where, according to the planning consent, there is to be a bond under the Highways Act, but neither the developer nor the local authority has entered into it. A property with registered title may have no easements for the drains or the water. A prospective purchaser may choose to change his mortgagee—or his lender, as we must call them—because he prefers a different mortgage product. Problems can also be caused by one purchaser in the chain being unable to get a mortgage product. There are a host of conditions set out in the Council of Mortgage Lenders' handbook, any deviation from which has to be referred to the lender. Most lenders now operate through call centres without legally qualified people on the end of the telephone and you cannot speak to the same person two days in a row. It is not uncommon to find a defective lease for leasehold properties and deeds of variation may be needed from the management company and the landlord. There is to be no obligation in the seller's pack to point out such defects. It is clearly stated that the principle of "buyer beware" will continue to prevail.
I shall return briefly to the pilot scheme. It is already out of date. It did not include an environmental search in the cost, although that is now considered to be good practice in many areas of the country. That will mean additional costs and additional time. Given the experience of the pilot scheme, hopes for a faster, friendlier conveyancing process are ill founded.
The scheme was restricted to properties in the city of Bristol. In most instances, it involved only one property out of the two in the usual sale and purchase arrangement. There were 250 packs on offer, for which the Government had paid the legal costs and disbursements. Six firms of surveyors, seven solicitors and two licensed conveyancers were involved, together with 13 estate agents. At the time the property market in Bristol was buoyant. Most purchasers did not bother with the packs. Estate agents used them to move the properties that they were finding difficult to sell.
Surveyors and solicitors were given targets of five and 10 days to carry out their tasks. Special arrangements were made by the lenders to deliver the deeds and only two lenders, both local to the area, participated in the scheme. Bristol City Council agreed to accept applications for searches by fax. The Minister's department had paid the fees in advance and encouraged them all to be returned in three days. Those circumstances will not be replicated across the country.
A national scheme would also result in a shortage of surveyors. I am advised—no doubt the Minister will tell me if I am wrong—that that is to be overcome by a scheme of accreditation, which will take 12 weeks. Would you buy a house that had been surveyed by somebody who had undergone a 12-week test to
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produce the report on which you were to place all your savings? I think that a very considerable number of people will require their own survey from a proper surveyor. In the pilot scheme, even the two local lenders insisted on dealing with their own valuation.
Delays arise from the difficulties that I have referred to and because, as the noble Lord, Lord Goodhart, said, there is a chain. People want to coincide their sale and purchase. They want to have their mortgage in place before they commit themselves. If they are properly advised, they will not be allowed to commit themselves until all the conditions attaching to their mortgage are complied with. They will definitely continue to tie in the purchase with the sale because it is too expensive and impractical to revert to the old practice of staggering the process and borrowing money in order to complete one stage before the other.
I may well be criticised by the Minister for being resistant to change. I submit that the legal profession has undergone enormous change, not least in the property-selling field. I should welcome faster, cheaper and easier processes but I do not welcome processes that add to purchasers' costs or that introduce criminality into this private transaction. What the processes seek to achieve is misguided and misplaced and will not make the system faster and easier, as the Government propose.
9.40 p.m.
Baroness Gould of Potternewton: My Lords, I have informed my noble friends on the Front Bench that I, too, am critical of Part 1 of the Bill. I shall explain why in some detail. Before doing so, I give credit to the Government for introducing the Bill, for being prepared to tackle the problem of homelessness and for making an attempt—I believe that it is not the right approach—to regularise home ownership and the housing markets.
Some years ago, the then Secretary of State for the Environment, Tony Crosland, described housing policy as "whimsical". Its capriciousness remains to this day. I sought to establish whether some of the problems in the housing market that make it so capricious would be solved by the Bill. As the Minister said, Part 1 will help the 1.5 million individuals and families who buy and sell homes each year and speed up the process, which is currently the slowest in Europe. I am not too worried about the speed of the process but I am much more worried about its uncertainty. I am prepared to wait in order to know that there will not be a series of problems along the way and that the process will not fail to be completed.
The Minister reported that 40 per cent of people are dissatisfied with the current process and he referred to the half a million transactions each year that fail. There is no doubt that gazumping thrives and that 28 per cent of transactions fail after terms have been informally agreed. The Minister and other noble Lords referred to the uncertainty and stress that that causes and to the abortive costs that can run into many hundreds or, in some cases, thousands of pounds. Change was obviously necessary. I am not certain that Part 1 meets that need.

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There is a need for greater transparency in the process. The seller's pack goes some way towards dealing with that problem. I therefore do not oppose the proposal as such because it will help the seller to decide on a realistic asking price and it will assist the prospective buyer to make a well-informed offer. From my own recent experience, the provision of a seller's pack alone will not resolve the many problems faced by sellers and purchasers. I have experienced problems in both capacities.
As the noble Earl, Lord Caithness, said, transactions will still fail. The proposal will not stop buyers from pulling out at the last moment—that has happened to me four times—the process will not necessarily be speeded up, and gazumping will not be eliminated.
I turn, as other noble Lords have done, to the question of the home condition surveyor's report. A property may look all right and one might think, "Okay, I can manage—perhaps—with a home condition surveyor's report". However, sometimes when one sees a property one thinks, "I am not sure about this property", and one chooses—I suspect that this happens in the majority of cases—to have a full structural survey report. I have done that on two occasions. We must be confident that what we are buying and spending this enormous amount of money on is going to satisfy our needs for a long period of time. We do not suddenly want the roof to fall in and be faced with large bills. I am absolutely convinced that a home condition survey report will not suffice for many properties, particularly old ones.
I would not accuse any seller of deliberately being dishonest about the flaws in their property or any estate agent—I look with respect to the noble Earl, Lord Caithness—of overselling the virtues of a property. But I am drawn to the adage that "he that pays the piper calls the tune"; and in this instance the piper is the seller. I am also drawn to the Explanatory Notes which make it plain that it is not intended that the Bill should alter the principle of caveat emptor—let the buyer beware. So I am worried about that aspect of the Bill.
In the statement from the Council of Mortgage Lenders, of which we all received a copy, it was said that there would be a need for the lender to retain the right to appraise the property. I should like to know how much negotiation took place with building societies to make sure that they are satisfied with the use of a seller's survey pack. Perhaps the Minister can tell us.
My noble friend also referred—I mention this in passing—to the fact that buildings societies would be asked to provide early mortgages and that offers can be obtained before a property is found. That is true. Offers can be made on the amount of salary one earns. But the lender will not issue that mortgage until after it has done the survey. So although we might think we have a mortgage offer, at the end of the process we may suddenly discover that that is not so. That aspect therefore is not as simple as was expressed.
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Another problem singled out by the Government, quite rightly, as being one of the most traumatic experiences in the house buying process is gazumping. In another place the Minister quoted anecdotal evidence of the heartaches, frustrations and financial loss suffered due to that practice, to which I can again testify from experience. It usually occurs when house prices are rising, and mainly in the South East. But it can happen anywhere. To the people involved it is not merely anecdotal but a real disheartening and costly experience.
That is why I am surprised by the Government's position as set out in the 1998 consultation paper. They stated that,
"these problems are rare. They average fewer than one in 50 transactions".
But using the Government's own figures, that could involve 20,000 people a year. For those 20,000 people it is a really serious problem. Therefore I do not consider gazumping to be a rarity. We will only abolish the pain of gazumping when legislation is introduced that makes acceptance of an offer to purchase a property a legal contract. Some reference was made to the Scottish system, which I know contains considerable flaws. Nevertheless, I should have liked to see an examination of that system to see whether or not those flaws could be ironed out. It certainly provides a level of security for both the purchaser and the seller.
Another cause of great distress is the buyer or the seller pulling out, particularly almost at the point of exchange of contracts. I understand the half-hour process in respect of contracts in a chain, and in one instance it happened to me literally half an hour before I was due to sign my contract. That was after I had waited three months for the purchaser to obtain his mortgage. I can assure your Lordships that that was an extremely distressing experience. At that point I wrote to my right honourable friend Nick Raynsford to ask whether the Homes Bill would do something about that situation. He replied,
"Our proposals will not prevent buyers pulling out at the last moment".
It is a great pity that this Bill does not do something to cover that.
It may well be that the Law Society's transaction scheme; the proposed national land information service; the seller's pack with its information upfront, and, ultimately, electronic conveyancing may marginally reduce the time between oral agreement and exchange of contracts. However, it will not take away the disappointments of withdrawals; just perhaps make them happen a little sooner.
Other noble Lords referred to the Bristol pilot. I understand that the take-up of the packs was far from universal, despite the fact that all the cost was paid by the Government. One-third of the buyers insisted on undertaking their own surveys. The Bristol pilot must be questioned for two reasons: first, it had no control group; and, secondly, by any definition it was a narrow piece of research. In his opening remarks the Minister referred to other consultations which have taken place.

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I should like to hear more about such consultations which would reassure me that the legislation was not solely based on the Bristol pilot. From the debate in the other place, it has been made clear that what might have been successful in Bristol may not be so in Brighton or Bradford, particularly not in areas of low-cost housing.
Perhaps I may ask a question on a point mentioned by other noble Lords. I refer to the fact that money has to be produced upfront for the seller's pack. Is it not a deterrent to people who might want to sell their property if they cannot afford the seller's pack? Are there any exceptions in order to enable and help people who might want to sell a property?
On behalf of all people like myself who have had bad experiences in the buying and selling of property, I believe that an opportunity has been missed to overcome many of the problems which we have faced and which others will continue to face in future irrespective of this legislation. Before leaving the question of the seller's pack, perhaps I may ask the Minister two practical questions on who the seller's pack will apply to. First, does the Bill exempt newly-built or converted properties from the home conditions report aspect of the seller's pack? Secondly, will buyers exercising their rights under the "right to buy" legislation receive a seller's pack from the vendor; than. is the local authority?
Having been negative about the first part of the Bill, I now wish to welcome warmly and endorse the Government's proposals in Part 2. I believe that my noble friend is correct when he states that the Bill will help to reduce homelessness and ensure a more appropriate provision of housing to homeless families. Other noble Lords applauded the repeal of Section 194 of the Housing Act 1996 which restricted local authorities from using their own housing stock as temporary accommodation, and Section 197, which limited a local authority's duty if it considered other suitable accommodation to be available in the area.
The noble Baroness, Lady Maddock, said that an amendment would be needed to the Bill. As a principle, I believe that the Bill is an immense step forward. More choice will be given to homeless people by allowing them to have a reasonable time to choose their permanent accommodation. That gives the homeless the same rights as others on the housing list. Fairness and a level playing field are essential in the access to and allocation of social housing.
The eighties and early nineties were years when homelessness increased. Many people at risk were denied access to priority housing. The causes of homelessness are diverse. There is no one reason for people becoming homeless. I am particularly concerned about the growing incidence of homelessness among women. It is clear that women face distinctive problems which increase their vulnerability to homelessness. Their weak financial position, for instance, puts them at a disadvantage in the housing market. Domestic violence is the most common reason for women in their thirties becoming homeless.
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Not often realised is the fact that domestic violence is a common reason for homelessness among women of pensionable age. That is why we tend to see more older women sleeping on the streets. Women's Aid reports growing numbers of women seeking assistance. Shelter reported that in 1997 more than 36,000 women sought its help and that figure is growing, particularly among young women. The number of women admitted to Shelter projects rose from 25 per cent in 1987 to 44 per cent in 1997. It is particularly disturbing that 66 per cent of the young homeless experienced physical, sexual or emotional abuse and in some cases all three.
As other noble Lords have said, the Government are right to extend those in priority need to include young adults, the 16 to 17 year-olds, the 18 to 20 year-olds, care leavers and also those fleeing from domestic violence and from racial violence. Those at-risk groups were not only neglected in the past but In some instances they were punished for being vulnerable.
However, the Government have also recognised that increased obligations and extra duties will entail extra costs. I hope that the Minister can reassure the House that local authorities will be given the necessary resources to carry out this crucial work, particularly in areas where there is great housing need.
Finally, in supporting the proposal that local authorities have to undertake regular reviews and to publish a homelessness strategy, can we be assured that these strategies will be transparent and available to the public, which is not at present the case in many areas? I was delighted to hear the noble Earl, Lord Listowel, talk about Leeds, which is my home town, and the progress that is being made there. Can authorities be urged to ensure that free advice and information about the right to housing is as widely available as possible? That is not always the case.
The Opposition in the other place rejected this legislation, particularly the extra help to groups at risk, on the spurious ground that it would increase queue jumping. For too many years the treatment of homeless people was characterised by the ethos and values of the Poor Law. It is time that some of the damaging myths and stereotypes about homeless people were removed. I believe that this legislation goes a long way towards that goal. As has also been said, it is greatly welcomed by groups working in the field. The Government deserve commendation and approval for introducing Part 2 and I hope that the Bill receives the support of the House and is enacted with speed.
9.58 p.m.
Baroness Hanham: My Lords, I hope that the Minister will be pleased to hear that I shall give him some small respite and shall not trespass on the Government's mounting grief over Part 1 of the Bill. I shall immediately declare an interest as a member of a local authority.
There appears to be general acceptance that, in broad terms, the provisions in Part 2 are welcome. Indeed, the good intentions are welcome. However,

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some practical issues need to be taken into account, not least the capacity of local authorities to absorb the impact of the proposals. Sadly, national strategies do not always reflect the nuances of local areas—in this case, those must be housing pressures.
The impact of homelessness across the country varies from those authorities where there is sufficient vacant housing to those such as the London authorities where housing both in the statutory and affordable private sectors in relation to the number of people requiring it is a scarce resource. The housing waiting list has long ceased to have any meaning in that there are thousands of people who have registered hopefully but have come to realise that they have no real expectations of those hopes being fulfilled. This has been a debilitating factor both for them and the authority which has had to maintain it. I do not believe that the removal of the requirement to keep such a register will be mourned, for the reality is that, by and large, it is those who are in priority need under the current legislation who have absorbed the totality of accommodation that is available from all sources.
Those in priority need, particularly the homeless, have been a large percentage of those housed, and the additional priority categories that are added by the Bill—the young leaving care, the young homeless, former prisoners and those at threat of violence—simply mean that to maintain a register of any other than those in the priority categories becomes self-defeating.
The amount of accommodation that is available to London local authorities from all sources is nothing like sufficient for their needs now, so it is logical and sensible that they should have the ability to take a flexible approach and that there should be co-operation between those which are subject to pressure and those which have accommodation to spare, particularly if those are areas in which people with aspirations to live in London are willing to settle as an alternative. Such flexibility will help, but as most people who are homeless in London want to be in London that relief may be only marginal.
One of the major expectations in the Bill is that those who have been assessed for priority need, as well as those who are accepted as such, will be provided with temporary accommodation, not for a maximum period of two years as at present but until permanent accommodation is provided by the local authority. In the authority of which I am a member there are currently 930 households in that position. At best, about 500 to 600 households in total, including some from the current waiting list, are able to be housed annually. Often it is fewer than that. It is not unfair to say that in London there is a crisis over temporary accommodation. Any such accommodation is limited. Many boroughs such as mine have limited amounts of short-life property, as it has now been rebuilt or improved for permanent housing, and many households must still be placed unsatisfactorily in commercial hotels. The situation in relation to permanent housing is nearly as bad.
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Permanent housing in London is in short supply and, even with the involvement of all other registered social landlords, the need cannot be met. Even with the extra money now being provided to enable the payment of a higher level of housing benefit in central London in particular, the costs of temporary accommodation run into millions of pounds. In my borough alone, the overrun on expenditure that is being borne by the council taxpayer now approaches £4 million annually. This is not helped by the fact that only 90 per cent of housing benefit is reimbursed. It is not hard to see that the provisions of this Bill will, therefore, exacerbate the financial difficulties. I very much endorse the observations of the noble Baroness, Lady Gould, about ensuring that if these provisions are enacted adequate resources are made available to local authorities to deal with this increasingly difficult problem.
It is odd that, as the Bill is drafted, there is no requirement for housing associations to help with the provision of either temporary or permanent housing within a local authority's housing priorities. I appreciate the remarks of the noble Baroness, Lady Dean, who is not in her place at the moment, about the involvement of the Housing Corporation in the whole of the Bill. It is true that some housing associations adopt their own priorities. But these may or may not accord with the local strategy of their local authority. I hope this area will receive further consideration in Committee, if indeed we ever reach such a stage.
Even with a requirement for housing associations to be involved—I fully accept that registered social landlords are mentioned, but housing associations are so fundamentally important to this matter—the implications that all those accepted as homeless have the right to a choice of where they wish to live is an expectation that may be hard to satisfy.
I recognise that in this respect London may be exceptional, but a requirement in legislation will, ultimately, be a requirement in law. London authorities will struggle to meet the burdens placed upon them as designated in the Bill. No one doubts the good intentions behind the Bill. It is right and proper that local authorities should help young people leaving their care into self-sufficiency, and, as any good parent would want, to see that they are properly housed. There are far too many young and vulnerable people sleeping on our streets. It must be of concern when people are threatened with violence and have to leave their homes because of it. At the very least, it is proper that they should be able to seek and receive practical advice and help.
I agree with the noble Earl, Lord Listowel, that there is variability in the value of the advice that is given by local authorities, but the constraints and limitations to the provision of accommodation of their choice for each and every person deemed to be in priority is, in London, a particularly tall order. To achieve the aspirations contained in these provisions will require a very flexible approach, probably even more flexible than the Minister at this stage appreciates.

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The construction of a homeless strategy can be part only of a more general policy on housing and the use of housing resources. Increasingly, local authorities are becoming the conductor of the orchestra rather than the main players as statutory housing moves from local authority control to housing associations, co-operatives and tenants' management organisations—as a result also of voluntary transfer. Therefore, the responsibility is beginning to lie elsewhere. A housing strategy rather than just a homeless strategy would reflect the totality of the policies of all these bodies. I hope that this part of the Bill will be amended to reflect that situation.
There are concerns about the proposals in this part of the Bill. Although I recognise that good practice dictates that there should be co-operation between all agencies to prevent homelessness, most local authorities of any standard and stature have been carrying out that co-operation. To have this issue underlined by legislation will, for some, just gild the lily that is already there, although I appreciate that for others it might be a sharp shake in the right direction.
The authority which I have the honour to represent has been selected as a pilot for the lettings test. It is already a beacon council for looking after care leavers from the age of 16, and the housing and subsequent care that are provided. I do not boast, I am just proud that somewhere along the line there is a local authority that is acting properly.
While there is much good in this part of the Bill, there are areas over which caution needs to be exercised and an understanding that matters are different in one part of the country from another.
10.9 p.m.
Lord Phillips of Sudbury: My Lords, I must declare an interest. As a solicitor, I have been directly involved in conveyancing over as many years as my noble friend Lord Goodhart. Although I ceased some years ago to do the nuts and bolts of conveyancing, I am still very close to it and will therefore confine my remarks to Part 1 of the Bill. I shall try not to repeat ground that has already been well covered.
The points made by my noble friend Lord Goodhart and others as to the criminalisation aspects of the Bill are wholly well founded. It is wrong in principle in a measure of this kind to contemplate criminal action. I am inclined to think that it is wrong in principle to try to force a method of proceeding in a contract of this nature, privately entered into between citizens. I do not think that the criteria by which the state should intervene in private transactions are satisfied in this case.
Perhaps I may make a few points on Part 1 of the Bill. I agree wholeheartedly with what the noble Lord, Lord Bowness, said very much from the coalface of conveyancing. I do not think that the speed of transactions will overall be much affected if the measure is carried into force as drafted. It may increase speed at the onset, although I am bound to say that these days any party to a conveyance needing swift
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action will make sure that its solicitors are into the fray well before the 14 day period provided for in the Bill for the supply of the necessary information.
The chain is the problem. It is the absolute blocker on any attempt and wish on the part of both parties to a transaction to get through it quickly. The majority of transactions are part of a chain—quite often of two or three separate transactions. Chains do not merely affect buyers. They affect sellers in a different way. Sellers will put their house on the market, having, as they thought, secured the house to which they want to go. They will not enter into a contract, as their solicitor will advise them, until they have a contract to sell. Then, hey presto, they are disappointed up the line.
The difficulties of speed are insuperable unless one adopts a Scottish system or something like it. I believe that the points made by the noble Lord, Lord Bowness, on that are conclusive against it.
There are other causes for the failure of transactions besides that of the chain. There are issues of financing; there are issues of changed circumstances on the part of either of the parties, the health of the parties or the family circumstances of the parties. There are 101 reasons, which those of us who have been in this world know all too often rear their ugly heads and abort a transaction.
Perhaps I may say a few words about the cost. A great deal of the Government's justification for the Bill rests on two statistics which the noble Lord, Lord Whitty, gave in opening the debate. First, he said that the cost of aborted sales in a year was in excess of £300 million. Reference was also made to the 28 per cent of transactions—the noble Lord expressed himself aghast—which failed between acceptance of a deal subject to contract and exchange of contracts. One needs to know two things about that latter statistic. The vast majority of those failures are because of failures in the chain up the line or down the line. Only a small proportion of them are for what one might call dishonourable reasons—people finding a property they prefer, if they are buyers, or gazumping on the part of sellers. The figure of 28 per cent should be seen in that light.
I turn to the cost figure of £300 million-plus. I believe that the increased overheads which will attend all conveyancing transactions if the Bill becomes law will make that figure look rather modest. We are talking about a seller's pack, which, roughly estimated, will be £600 of work, mainly on the part of the surveyor but also on the part of the solicitor, plus the local search fee of £100 plus, as it is in most places now. In a high proportion of cases those overheads will be wholly or partly wasted. My noble friend Lord Goodhart referred to the fact that only 30 per cent of conveyances today are with the benefit of the survey that will be a compulsory part of every conveyance in the future. He gave the reason for that: the majority of purchasers are willing to rely on the much cheaper and obviously less comprehensive mortgage survey.
However, many other circumstances arise where people do not go to the expense and trouble of securing a full survey. If they are taking on a property with a

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view to rebuilding or substantially reconditioning it, they will not worry about a survey. My own first two purchases were completed without the benefit of full surveys. On the first, I asked a friend who was a surveyor to walk around and take a look. I was content to rely on that. On the second, I secured only a basic, cheap survey because I thought that I knew what I was doing. Thank goodness, I did. From now on, however, in every case the "full works" will need to be undertaken—at vast expense.
We need to bear in mind the point that the overheads of both the seller and the buyer ultimately will be reflected in an increase in the cost of the property. There is no way around that. It will work its way through in a very short space of time. Even if we calculate additional overheads of only £200 per transaction, given that we see around 2 million conveyances per year, that will be £400 million in extra overheads. The figure of 28 per cent aborted sales comprising dishonourable conduct which the Government are seeking to check will form only a tiny fraction of the final figure.
I should like to comment on what I believe is the wholly unfair one-sidedness of this legislation. It puts all the burden, all the expense and all the criminality on to the seller. I do not see how that could be conceived as a balanced piece of legislation. In responding to that point, Nick Raynsford, the Minister for Housing and Planning, wrote to Charles Clarke, who in turn had sent him a letter from Standley Bushell, President of the Norfolk and Norwich Incorporated Law Society. This was one of the points raised by the society. The reply from the Minister was as follows:
"We are not imposing legal obligations on buyers, but we do consider that it is important that buyers are well prepared before starting on the home buying process, and would encourage buyers to obtain an In-principle' mortgage offer before making an offer on a property"—
as if, in any event, an "in principle" mortgage offer would be sufficient for the purposes of entering into a contract. The Minister went on by stating:
"We anticipate that the new system will put pressure on buyers to come to the market prepared".
How will this put pressure on the buyer? I should be grateful if the noble Lord, when he responds to the debate, could answer that point. That explanation will be the only justification for passing into law this one-sided piece of legislation.
I believe that it will have precisely the reverse effect. Rather than put pressure on a buyer, it will place a lever into the hands of an unscrupulous buyer that will be used unfairly. If someone has already invested £600 on the seller's pack, the buyer can then string out the process for as long as possible. In a flat market or a buyer's market, that could well lead to a situation where the buyer will be able to go back to the vendor and say, "I can no longer afford the price I agreed in principle some three months ago. By the way, I need a new search and the survey is out of date. I'm afraid that all I can offer is the asking price minus x".
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Consider the situation where old-age pensioners put their only asset—their home—on to the market. Pensioners may have to deal with unscrupulous commercial landlords—such people are still about—who will be looking out for such vulnerable people. They will make play with this unbalanced and one-sided set of rules. I urge the Government to contemplate that.
If the Government response is that I should not worry because a defence is allowed against the offence of failing to provide a seller's pack under Clause 3 of the Bill, I have to say that that is no defence at all. It will be completely useless as a protection for someone caught in this position. Clause 6(3)(a) states that it is a defence for a person refusing to supply a pack to say that he or she thought that the person asking for it,
"was unlikely to have sufficient means to buy the property in question".
You are not going to know that until some way down the line.
If someone comes to you, saying, "I want a pack", will it be sufficient for an interrogation then to occur between the would-be seller and the would-be buyer to ascertain whether the would-be buyer is "likely to have sufficient means" to buy the property? I do not think so. It is not a defence. It does not add up to anything worth having for a seller put into the position that he or she could be placed under this one-sided arrangement. This penalises sellers severely and unfairly, and to no purpose.
Quite apart from the point I have just made, there will be many circumstances where, for good reason, a seller withdraws a property from the market. Under the law, he or she has to provide this expensive pack even though no one is prejudiced by the withdrawal of the property from the market—that is say, no buyer has committed himself to expenditure. In those circumstances, as I said, a real harshness and unfairness will be imposed on the seller.
As I mentioned earlier, there are many circumstances in which such a situation could arise—family changes, a child coming home, a divorce, a pregnancy, illness, a loss of a job, a business that has gone downhill. It could merely be that the property has been on the market for six months, has gone stale, and the agent has said to take it off the market. In such circumstances, the seller will have wasted all this money and will have to get a new survey and a new set of searches when the property is put back on the market.
For all these reasons, and the reasons mentioned by other noble Lords, I believe that Part 1 needs substantial review. The trial in Bristol was not adequate. In any event, the framework provided is altogether too insensitive to cope with the myriad differences and variations which attend conveyances in this country. Frankly, unless the Bill seriously improves the conveyancing process overall, it is not worth having as regards Part 1. I say that while recognising that other parts of the Bill are of great utility. For those reasons, I hope that the Government will think hard about this matter.
10.22 p.m.
Baroness Hamwee: My Lords, during the lifetime of the previous government we were accustomed to hearing a great deal of criticism from the then official opposition of the government's housing policy and the great gaps in it. I congratulate the Minister for bringing this measure to the House but, like others, I wish that we had seen it a good deal earlier. No doubt the imminence of the end of the parliamentary term concentrates the mind somewhat. These measures are rather late but, conversely, the seller's packs—I agree with nearly everything that has been said about them—come at the wrong time and inadequately.
I should declare an interest as a solicitor and a partner in a practice in London. I should like to declare more of an interest than perhaps technically I have to as a member of the Greater London Authority, where we do not have the power to provide housing but we do have a huge policy concern. I certainly have an interest in that capacity in the more normal sense of the word.
We have waited in vain for support to arrive for these seller's packs. There was perhaps some from the noble Baroness, Lady Gould, but her support could not be said to be a great deal more than lukewarm, if I can put it that way. Not to put too fine a point on it, speaking for all of us on these Benches, I, too, believe that Part 1 should be deleted from the Bill.
As we have heard, there has been a very limited pilot, which was not a true test because the Government paid for it. There is provision for the creation of a criminal offence when we have heard so often that the Government will not create new criminal offences lightly, with resource implications for its enforcement. I expected the noble Baroness, Lady Hanham, to refer to that when she was talking generally about the resource implications of the Bill. There are also resource implications there for local authorities.
It should not be forgotten that properties can change hands for £10,000, £25,000 or £50,000. The cost of these proposals for low-cost properties would be disproportionate or even unaffordable. A third problem is the chain, and I do not believe that that can be addressed through this measure.
A fundamental issue is the acceptability of the condition survey to lenders. I was surprised to hear that only some 30 per cent of purchasers arrange for their own surveys to be carried out. It is ironic. This problem is the opposite of what I had perceived as the current problem; namely, that a lender's valuation is often inadequate for the purchaser. The question of liability surrounds all of this.
We need to examine ways of improving the speed and certainty of conveyancing. I hope that that need can be met very soon by technological advances. The noble Baroness, Lady Byford, referred to the Internet. I believe that there will be a far wider application of Internet technology, as my noble friend Lord Goodhart mentioned, than simply to sales. I hoped to have read before this debate the paper that has come from the Lord Chancellor's Department on electronic
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conveyancing; but unhappily, the Printed Paper Office did not seem to know about it, even though it was explained that it was in response to a Question from the noble Baroness, Lady Gould, and its publication was announced. Progress must lie in the world of technology, which is moving ahead so fast. The noble Lord, Lord Bowness, referred to this, as he did to the dangers of the seller's pack including a form of contract. Having had unfortunate experiences in this area, my observation is that some estate agents have difficulty in working out who their client is. They may well be too tempted to push a particular form of contract much too hard.
My noble friend Lord Goodhart and the noble Lord, Lord Bowness—indeed every speaker—gave what amounts to a devastating critique of this proposal from many different perspectives. On these Benches we would support whatever assists consumers, both buyers and sellers. But in our view the seller's pack will not increase either speed or certainty.
Those of us who have criticisms of Part 1 of the Bill must seem to be a self-centred, whingeing bunch to those who we hope will benefit from Part 2. The noble Earl, Lord Listowel, spoke powerfully about the effects of homelessness, as he always does. My noble friend Lady Maddock and others spoke about the need not merely for a homelessness strategy but for housing strategies. A report on the subject was published recently by the Association of London Government. It is worth quoting from the introduction to the report which expresses rather well the position on what should be—although I hate the term—joined-up policy making. It says:
"Achieving both sufficient housing to meet demand and balanced communities and sustainable development is the key challenge for London. Quality is as important as quantity. Minimising social polarisation and social exclusion must be a key policy objective. Increasing choice for all households is also critical. This requires an integration of housing. planning and broader social policy and corporate and inter-agency implementation of policy initiatives".
Strategists increasingly demand partnerships—particularly, partnerships between local authorities and housing associations. We support further proposals for housing associations to assist local authorities to meet housing need. The noble Baroness, Lady Dean, whom I should never describe as an "anorak", made some interesting comments about the interaction of the two sectors.
All local authorities need the tools and mechanisms as well as the policies. We need affordable housing not just for those who cannot afford any housing at all but afforded in the right place to those who until quite recently one would have regarded as having a reasonable middle-sized income. There are other measures such as mortgage rescue packages.
While welcoming the proposals for a strategy, given the caveat that I have mentioned, I wonder if we are not still in a little danger of compartmentalising what local authorities need to do. It is not very long ago that Parliament passed the Local Government Act 2000 providing for every local authority to have the duty to prepare a strategy for promoting or improving the economic, social and environmental well-being of

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their area. Housing is absolutely fundamental to that. For those who are in non-priority need—I find that almost a contradiction in terms—a duty rather than a power would be the ideal, but it is welcome.
I recently came across a reference in a report to two London boroughs which looked at how single homeless people were treated. In one borough a single woman fleeing domestic violence was told that she could not be seen unless she showed her passport. In another she was referred to the council tax office. I am told that others approaching London boroughs receive similarly unhelpful advice.
The comments go on to say,
"Despite this evidence, we are aware that some London boroughs do provide a decent level of service for single people, despite significant pressures on their services. This suggests that poor service is not just about levels of demand".
I was also struck by the comments made by the noble Baroness, Lady Gould, about people being punished for being vulnerable. Why should a victim of violence be the one to lose his or her home? We support these proposals although we want to see improvements on matters such as the period for an applicant to consider an offer and so on.
Finally, there is the question of allocations. I am guilty of being one of those whom the noble Baroness, Lady Dean, referred to as not perhaps being adequately optimistic or understanding. At first I thought that it was unrealistic to talk about giving a choice when there is no selection. It is right to continue to make that an aspiration. Choice is about dignity and not categorising people for whom the services are provided as being in any way second class.
The noble Earl, Lord Listowel, referred to benefit delays. It is important and a real problem from many angles including deterring landlords from making property available in the private sector in the first place. He also spoke about the variable quality of advice. I have a great sense of déjà vu since we seemed to debate that during the passage of the last major housing Bill. It is hugely important. The assessment of need and tailoring advice and assistance is an enormous element in preventing homelessness and ultimately preventing rooflessness.
Part 2 of the Bill is part of the jigsaw for providing decent homes which we on these Benches regard as a basic human right. We wish that part of the Bill perhaps not quite a fair wind. I would like to see it picked up by a tornado and whirled into port. I hope that that same tornado will sink Part 1.
10.34 p.m.
Lord Dixon-Smith: My Lords, only yesterday the noble Lord the Chief Whip persuaded us that today was the final Wednesday of the Session. If his remarks have any validity at all, this debate takes place in somewhat unusual circumstances. The future progress of the Bill—if it is to make any at all—will be subject to many conventions which I have tried to explore but with little success. As regards the kind of procedures which the Chief Whip may have envisaged, it appears
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that anything might be possible, but, at the same time, nothing could be possible. We shall have to deal with that situation if it arises. However, in the back of our minds we must all bear in mind the fact that the Bill might have to make regular progress.
There has been remarkable consensus on all sides of the House that the Bill comprises good and bad elements. That is not unusual. Oppositions instinctively tend to find fault with legislation. However, two parts of the Bill are welcome. One has to welcome anyone who is brave enough to venture into the free market of the housing market with the idea of simplifying it, speeding it up and improving it. It is a rash attempt. If the Government have listened to the comments made tonight, they must now realise the rashness of their actions.
However, Part 2 has been generally welcomed. I add my voice to that welcome. In parts of the country homelessness constitutes a deep, chronic and worrying sore on the whole of society which everyone feels. It is, of course, particularly acute in a metropolis such as London. All the policies in the world will not solve that problem because invariably—this will be the case for as long as I can foresee—there is a shortage of available housing in London. The demand outruns supply and that, of itself, is a problem.
My noble friend Lady Byford made the same point with regard to rural areas. These problems are difficult to tackle if there is a shortage of resource. However willing local authority staff may be to aid the homeless, it is difficult when they know that the physical resource is not available. I recognise that local authority staff—we heard from my noble friend Lady Hanham many of the implications of the measure—must feel deeply frustrated when they wish to help people but are unable to do so for the perfectly sound reason of a lack of physical resource. I am sure that that is part of the reason why occasionally people are given a less than satisfactory response. However, Part 2 of the Bill may be capable of being adapted.
Part 1 of the Bill concerns the aspect of the housing world with which I am more familiar. However, I certainly have no interests to declare as a lawyer or an estate agent or anything else, which, for once, is a great relief to me. It seems to me that as regards Part I the Government have set up a target at which they have aimed but they have proved to be rather a bad shot. They seem to have missed what they seek to achieve.
One of the reasons for Part 1 of the Bill was that gazumping and gazundering were again becoming prevalent in the housing market. As we have heard from noble Lords around the Chamber, the Bill does not tackle that issue. In my judgment the Bill does nothing to shorten the procedure for making a housing transaction. Although if all goes well, the documentation is agreed and everyone acts with sweetness and light, the time for two parties to come to an agreement may be shortened, it is dependent upon the seller doing a great deal of preparatory work before sellers and buyers get together. The total time for the transaction will still be the same. The work done by the seller is part of the transaction time. I do not think that there will be any saving of time.

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I agree with so much that has been said. The Bill also misses its target because as drafted it appears to suggest that all the problems in the housing market are caused by sellers. We have heard enough today to know that that simply is not so. There are problem buyers. The chain, about which we have heard from many noble Lords, is a serious difficulty.
We then have what I regard as a preposterous suggestion: that if a seller does not comply with the letter of this law he should be subject to serious criminal charges. At present, the housing market is flexible. I may say to an agent, "I'm thinking of selling my house". The agent may know someone who considers it a nice house. I do not understand why he cannot say to that person, "That house is coming on the market. Will you be interested?" In those circumstances, agreement is reached speedily and a transaction takes place. As the Bill is drafted, such flexibility will no longer arise. That is unreasonable. If one does not fulfil the procedures set out in the Bill, one can be fined up to level 5 on the scale of fines. That is the maximum criminal fine which a magistrates' court can impose. I find it amazing that someone who fails on a technicality in this area may be susceptible to a criminal charge at that level. I recognise that Schedule 1 refers to fixed penalties. I was attracted to the suggestion by the noble Lord, Lord Goodhart, of civil redress if we have to go down that road. So there is a problem there.
The home condition survey has to be undertaken by someone with a qualification yet to be established under regulations by the Secretary of State. It is interesting to note that such a measure was in the Estate Agents Act 1979. Clause 22 purports to deal with standards of competence of estate agents. For some good reason—I am sure that it exists but no one has ever explained it to me—that clause has never been implemented. If we have to devise a new qualification for home surveyors, will we ever get this measure to the starting post? There is a major problem there.
Reports will also have to be made on the thermal efficiency of a property. The number of people in this country qualified to do that work could probably be counted in tens, or at the most in scores. There are certainly not enough of them to do the work.
There are some fundamental flaws with Part 1. I wholly agree with the serious arguments that have been put suggesting that it should not make further progress. However, we have to face the fact that the Bill may have to progress in the normal way. I dread that prospect, because without a great deal more flexibility than the Government appear to have been prepared to show in the other place, I have grave doubts as to whether Part 1 could ever be put into sufficiently good order as to be satisfactory legislation that this House would be pleased to pass. That will be a potential difficulty in the future. I hope that we do not have to cross that bridge.
10.46 p.m.
Lord Whitty: My Lords, as we have been in this Chamber solidly for two and a half hours, I do not
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know what happened in Albania, but this has certainly been a game of two halves. I shall start with the second half.
We had a pretty wide welcome for Part 2, even if some noble Lords were more equivocal than others. Its general drift was welcomed by the noble Baroness, Lady Maddock and, to an extent, by the noble Baroness, Lady Hanham, with positive contributions also coming from the noble Earls, Lord Listowel and Lord Longford, who is no longer in his place—and quite right at this time of night. The noble Earl, Lord Listowel, gave graphic descriptions of why we need the provisions. My noble friend Lady Gould spelled out why women suffering from violence or the threat of violence, as well as other groups, need the new legislation.
I shall attempt to cover the questions that were raised. I accept that the use of bed-and-breakfast and temporary accommodation has increased and is at too high a level. That is largely a legacy of previous regimes and the treadmill created by the Housing Act 1996. We are tackling that through capital investment in housing. The Bill will ensure that suitable temporary accommodation must be provided for homeless households until a settled housing solution becomes available. That is one reason why an increase of £8 million for each full year has already been included in the revenue support grant settlement for local authorities. We are providing additional resources in both respects to meet the point made by the noble Baronesses, Lady Hanham and Lady Gould.
The problem is particularly acute in areas of high demand. The Government are very concerned about that. The backlog is mainly due to the insufficient supply of social housing. We are tackling that through increased capital grant, by doubling the Housing Corporation's investment programme and, by providing £250 million over the next three years for a starter home initiative to help key workers find accommodation.
The Bill creates some additional pressures, but it also provides greater flexibility for local authorities by removing the current restrictions on the way in which they allocate housing. The Bill facilitates but does not require choice-based letting schemes. We recognise that that will be much more difficult in some areas than in others. We also recognise that one has to treat differently the situation regarding temporary accommodation—the way in which to deal with those who are vulnerable and on the streets—and the allocation of permanent accommodation. There is a tendency to elide those matters. Although there is a read-across in that regard, the two matters have to be treated separately.
We agree that there should be strong co-operation between local authorities and registered social landlords. Registered social landlords are already under a statutory obligation to co-operate with local authorities. The Bill will require local authorities to consult registered social landlords. As my noble friend Lady Dean said, the Housing Corporation will strengthen its regulatory guidance, procedures and

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funding arrangements to ensure that registered social landlords co-operate effectively with local authorities without the need for further statutory requirements. That co-operation is necessary if we are to achieve the aims of Part 2 and deliver improved facilities for the homeless.
The inclusion in the vulnerable groups of 16 and 17 year-olds, care leavers aged 18 to 21 and those who are vulnerable as a result of an institutionalised background—those from prisons, hospitals or the Armed Forces—will create additional dilemmas. However, that means that all groups are provided for and that there is a duty to do so.
This is an important proposal to secure the resettlement of people who might otherwise end up sleeping rough. It is important to distinguish between that effort and the long-term allocation of permanent housing. The proposal is not a recipe for queue-jumping or for altering the priorities that local authorities already give to different groups that are in need of social housing.
There may be pressure for reduced provision. The noble Earl, Lord Listowel, and the noble Baronesses, Lady Hamwee and Lady Maddock, suggested that the assistance for those with non-priority needs might suffer as a result of broadening the categories of vulnerable people. The Government have already included, during the Bill's passage through another place, provisions for strengthening the duty owed to homeless families or individuals with non-priority needs. We intend to follow that up by improving statutory guidance in that regard. The noble Baroness, Lady Maddock, raised several detailed questions in that context. I shall attempt to answer some of them now but I may have to write to her about most of them.
The noble Baroness asked about the minimum period of three days for considering a housing offer. The Government are concerned that a minimum requirement would become a maximum requirement, which many authorities might use as a yardstick. Local authorities must act reasonably and allow sufficient time for consideration. In certain circumstances, that will take more than three days.
The noble Baroness also asked about how to accommodate people who are pending review on appeal to a county court. We do not consider that it would be sensible to require local authorities to accommodate all applicants when an authority has decided that no duty is owed to it on the grounds that applicants are not in the priority categories. It is right for local authorities to retain discretion relating to accommodation in such cases. I shall write to the noble Baroness about the other four or five points that she raised.
The noble Earl, Lord Listowel, discussed the problems caused by housing benefit. We are well aware of those difficulties. Improving standards of administration is a key priority for the Government's reform of the housing benefit system. That was covered in our December housing statement.
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A couple of other points that are not covered by the Bill were raised in our debate. The noble Baroness, Lady Byford, discussed housing in rural areas. We set out in the rural White Paper and in our planning guidance on housing—PPG3—new powers to ensure an adequate supply of affordable housing in rural areas. That is being addressed in a different context. We recognise that specific problems arise in relation to homelessness in rural areas.
The noble Earl, Lord Listowel, and the noble Baroness, Lady Maddock. raised the question of why there was nothing in this Bill in relation to multiple occupation. I accept that we have not included such a provision in the Bill but it remains a government commitment. We found neither the space nor the time to introduce the licensing of HMOs in this Bill. However, we do not intend to backtrack on that commitment. It makes greater sense to link licensing with other measures aimed at improving the quality of housing and it is our intention to come back to Parliament on those issues.
That deals with the points raised on Part 2, which was widely welcomed. Now we turn to Part 1. A real problem arises in relation to Part I. Everybody accepts that the present system does not work; almost everybody accepts that it should be speedier; some people consider it should be significantly cheaper and that there should be less uncertainty. However, the proposals that we put forward to achieve some of those aims are rejected.
The noble Lord, Lord Dixon-Smith, referred to a free market. If this were a labour market, many free marketeers and probably some of my friends in new Labour would describe it as sclerotic. It has huge rigidities. It is highly institutionalised and is far from transparent. We are attempting to address all those areas. The noble Lord, Lord Bowness, said that although it may be a bit on the slow side, it is cheap.
Lord Bowness: My Lords, with respect to the Minister, his survey said that; I did not. I only quoted it.
Lord Whitty: My Lords, that is at least one point on which we are in agreement. But the cheapness element only arises if we do not take into account aborted costs. One of the key aspects of the English market as distinct from other systems is the high level of aborted costs—£350 million is the figure that I quoted. I am not claiming that we will save all of those costs, but we can save a significant part of them. The noble Lord, Lord Phillips, said that of course there will be aborted costs—people move; people divorce; people change their minds; situations change; people decide that they want a different property after all. That is true. But that applies in other countries as well. Divorce and pregnancy have even been known to happen in Scotland. What is unique about the English and Welsh market is that the form of institutionalisation causes severe delays which are over and above those which

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seem to apply in other systems. It is that problem that we seek to tackle. And nobody has actually put forward a better solution.
Baroness Byford: My Lords, I thank the noble Lord for giving way. He said that people change their minds abroad just as much as they do here. But in fact home ownership in this country is much higher than it is in other countries. Therefore to compare our figures with those of other countries is not a fair comparison. It does not detract from what the Minister says. But we should remember that home ownership is much higher in this country.
Lord Whitty: My Lords, that is true, and that would affect a comparison with the £350 million figure. But the time issue relates to individual transactions. There is no reason why, because we have a higher level of home ownership, we should have a longer period of transaction. If anything, one would have thought that economies of scale would be involved.
Baroness Maddock: My Lords, one of the other important matters is the chain. Because so many more people are m the housing market, the chain is much more of a problem in this country than anywhere else in Europe.
Lord Whitty: My Lords, that is a non sequitur. Simply because more people own their own homes does not mean that people should be involved in longer chains.
Lord Phillips of Sudbury: My Lords, I am obliged to the Minister for allowing me to intervene. I merely reinforce my noble friend's point. The fact is that if two or three transactions are inter-dependent, then they move like a convoy; that is, at the speed of the slowest transaction. If one of the transactions fails, then because of our prudent policy of not entering into a contract until one has a firm back-up contract, all of those transactions fall together. That is the fact of the matter. The Minister says that we have not come up with a better idea. With respect, I do not think that his Bill addresses the chain problem.
11 p.m.
Lord Whitty: My Lords, by speeding up the process and putting upfront much of the information gathering, the likelihood of particular transactions falling through is reduced. Therefore, the impact on the chain is reduced. I accept that some noble Lords do not think that our proposition achieves that. However, I suggest that it does so better than the present situation. it may not be ideal but it goes some way to meeting the problems of the present market.
Other objections were raised. The noble Earl, Lord Caithness, began his remarks by stating that this changes the whole nature of the relationship between the agent and seller. Perhaps I may say to the noble Earl that it does not. The noble Earl is clearly a meticulous estate agent and surveyor. I may well take him up on his implied offer to help me when next I sell
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my house. The fact of the matter is that he already has a duty under the Property Misdescriptions Act 1991. That Act requires estate agents to take reasonable steps to verify information provided by sellers. Therefore, the question of trust is already loaded on to the estate agent. The Bill does not change that basic situation.
Comment has been made that the Bill does not tackle gazumping. It does not do so head-on in the sense of banning it—there are misapprehensions about the Scottish situation—but it addresses gazumping indirectly by narrowing significantly the window between offer, acceptance and exchange of contracts, during which period gazumping frequently occurs. It is difficult to see how we could deal entirely with the problem of pulling out at the last moment or how we could ban gazumping completely. There will always be situations where it is reasonable that the seller should be able to offer the property to another buyer or to withdraw that property from the market. Nevertheless, if the proposals were accepted and operated across the market, I believe that the incidence of gazumping would be reduced significantly.
The noble Lords, Lord Phillips, Lord Goodhart, Lord Bowness and others all said that the seller's pack would add to rather than reduce the cost of buying and selling. There are a number of points to be made on that. First, the information in the pack is that which needs to be provided at some stage in the transaction in any event. The only additional item is the home conditions report. That is additional only in the sense that, as some noble Lords have said, in some transactions under the present system buyers do not commission their own surveys. Secondly, the overall costs are likely to be neutral between buyer and seller in many, if not most, cases. The seller's pack involves a shift in cost from the buyer to the seller. However, as the vast majority of sellers are also buyers, because of the chain, that balance will shift. Indeed, the only buyers who are not sellers are first-time buyers who face substantial costs. That will be shifted away from them. If we were to keep the whole burden of the cost on the buyers, it would continue to be detrimental to first-time buyers.
Lord Goodhart: My Lords, I am grateful to the Minister for giving way. Have the Government considered what would be a much simpler and cheaper way of achieving results than requiring the home condition survey and the seller's pack, which is to reverse the existing rules of caveat emptor; namely, the buyer is stuck with what he gets? If the buyer could sue the seller for any defects that had not been disclosed to him, that would, first, put the seller on his toes to ensure that he did make disclosure and, secondly, it would do so without this elaborate and bureaucratic system.
Lord Whitty: My Lords, the noble Lord referred to an elaborate and bureaucratic system. That would he replaced with one enforced by considerable litigation. We would have to hesitate before altering the general

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presumption in every market under English law in relation to caveat emptor. I would be hesitant to go down that route.
Lord Goodhart: My Lords, not in the sale of goods.
Lord Whitty: My Lords, subject to statutory restriction, that is true. But where there is no statutory restriction, that is the presumption. Thirdly, in relation to costs—
Lord Bowness: My Lords, I am grateful to the Minister for giving way. I do not want to detain the House but I want to clarify an important point. Can he confirm that as things stand there will be no obligation on a seller in the pack to point out any defect in title and it must therefore be examined carefully by a buyer's solicitor? If a defect is found, the time spent will be the same as it currently is. If the buyer has to pull out, the effect will be precisely the same.
Lord Whitty: My Lords, the noble Lord's premise is right but his conclusion is not. It is right that there is not a requirement that defects in title should be pointed out and that it would be subject to the usual checking by the buyer's solicitor. The point is that the information required to be checked would be provided up front by the buyer before he goes to the market. That is where the time saving occurs.
I believe that I have made sufficient points in relation to the cost, except in relation to a point made by a number of noble Lords that the lenders will in any case require separate valuation surveys and therefore the apparent saving will not arise. Certainly, the lenders will continue to require separate valuation inspections but for the most part lenders are moving to a more simple system of valuation. Many have desktop methods of valuation assessment. The home condition report will assist them in that and will therefore provide cost savings either to the home buyer or to the lending organisation.
Many buyers will not regard the home condition survey, the seller's pack, as sufficient, as my noble friend Lady Gould said, and they will therefore commission their own survey as under the present system. But that is not an argument for not bringing as much of the information as possible to the market right at the beginning of the process instead of both sides having to proceed with the various professional bodies in parallel or in part in series through the lengthy process.
The noble Lords, Lord Phillips and Lord Dixon-Smith, asked how the seller's pack will bring pressure on the buyer to come to the market prepared. That is the other element of speeding up the process and bringing it up front. Because the seller's pack will provide up-front information the buyer can move quickly in relation to his own lender. He can establish an in-principle mortgage and that will rapidly smoke out any prospective buyer who is not serious. Therefore, both sides of the equation will be in a
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position to share information and to move on the basis of that shared information at a much earlier stage than the process currently provides for.
There is the continuing problem in relation to the point made by my noble friend Lady Gould that buyers and lenders will not trust the home condition survey, but nevertheless they will have it at an early stage. If at that stage they consider it to be inadequate, they can take out their own additional survey. I believe that we will be able to rely on the home condition report to a large extent. It will be setting up a certification scheme for home inspectors to ensure consistency and high standards. A level of inspection will be similar to the current home buyer survey and valuation, which is the survey most commonly used by home buyers, and home inspectors will be liable to sellers, buyers and lenders so that they can enable all the key parties to any sale to have full confidence in their reports.
My noble friend Lady Gould asked about lenders. The Council of Mortgage Lenders has been consulted on this matter and is one of the main stakeholders involved in developing both the format of the home condition report and the associated regime which will underpin it. Therefore, the interests of lenders are fully engaged in the process.
The noble Earl, Lord Caithness, said that the home condition report was too simplistic. Like other noble Lords, he went on to query the Bristol pilot. The Government commissioned that pilot and paid for part of it. That pilot shows quite clearly that the seller's pack can be assembled quickly; and that it injects transparency into the process and gives buyers and lenders a clearer understanding of the property. It proves that the seller's pack increases certainty and that problems are resolved more rapidly than elsewhere.
My noble friend Lady Gould asked whether the Government relied entirely on the Bristol experiment. Part of the background to the Bill includes a study of international comparisons, the biggest study ever undertaken of the system of home-buying in England and Wales, a major consultation exercise involving about 1,000 responses, a study of 14 existing sellers' packs and, in particular, research into low value, low demand areas. It also included a litmus test of small businesses. We continue to look at the detailed implementation of the scheme. We have just commissioned a study to look at the role of insurance products. We shall consider other matters in the runup to implementation and the final regulations as regards the form of the seller's pack.
Two other main issues were raised: sanctions and how the scheme would operate in low value markets. It is claimed that criminal sanctions are completely inappropriate in this area. In order to be effective, the seller's pack must he backed by appropriate sanctions; otherwise, the temptation for people to attempt to market their houses without sellers' packs will be too great. In this context we have looked at whether we can use civil sanctions but have concluded that they cannot provide an effective deterrent. Civil sanctions can be

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based only on the buyer taking action through the courts. The buyer will need to demonstrate that he has suffered financial loss in the process, which may not be easy.
Therefore, we have concluded that the long stop should be criminal sanctions. That is consistent with similar sanctions, for example, under the Property Misdescriptions Act 1991 and various obligations under the Landlord and Tenant Act. That does not mean that we have moved directly to criminal sanctions. Local trading standards officers will have discretion to take appropriate action where they find a person marketing a home without a seller's pack. That discretion will be vital in ensuring that action is proportionate, especially in cases where private sellers are ignorant of the law and make an honest mistake. There is a range of possibilities, from offering help and advice to a warning right through to the imposition of criminal sanctions.
Baroness Hamwee: My Lords, in drafting these provisions have the Government discovered whether criminal sanctions in the transfer of residential property are applied in any other jurisdictions?
Lord Whitty: My Lords, as the noble Baroness knows better than I, the distinction between civil and criminal law in other jurisdictions is a little more blurred than in this country, but certainly sanctions are applied in other regimes.
The final point on which I wish to touch is property in low value, low demand areas. Concern was expressed by the noble Earl, Lord Caithness, my noble friend Lady Gould and others about the effect on low value properties and whether they would come to the market. We have made it clear that we are prepared to consider measures where the seller's pack requirements would cause difficulty in particular areas or with particular types of property. We are preparing a consultation paper which will set out a number of measures that we might consider.
Under the Bill there is a possibility of having different instructions for different types of property. However, our research hitherto has shown that sellers' packs would offer benefits in precisely those low value areas about which people are concerned. As noble Lords have said, we must avoid the question of a two-tier market and of stigmatising properties in areas of declining demand and low value. That is quite a difficult area. However, there is the possibility under the Bill to provide separately for those areas.
Many points have been made tonight. Were we to have a normal process for the Bill, some could be explored in later stages. Many points misunderstand the benefit of this process and none provides a better solution to what, almost everyone is agreed, is the present problem with the housing market. Our proposals go some significant way to easing the pressure on the buying chain and will thereby bring some comfort and financial and time benefit to those engaged in 11-ie market. We recognise that other noble Lords think differently.
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The noble Lord, Lord Dixon-Smith, referred, somewhat delphically to particular contingencies which might arise. They no doubt would he dealt with either within or without this Chamber. We may have to deal with those matters. However, despite the rather wide-ranging barrage of criticism of Part 1 of the Bill, no one has proposed anything better.
We are convinced that it is sensible to take the legislation forward. We shall consider how to deal with the matter at later stages. I very much welcomed the wide and heartfelt support for Part 2 of the Bill.
Lord Bowness: My Lords, before the Minister sits down, can he deal with the point raised by my noble friend Lord Caithness and, indeed, myself: what is the envisaged shelf life of the seller's pack and the home condition report—six months, one year or has it statutory immortality?
Lord Whitty: My Lords, as the noble Lord knows, none of us has statutory immortality. We are not proposing that the seller's pack should be required to be renewed. The only items likely to have limited shelf life are the home conditions report and possibly, in certain circumstances, replies to local searches. Since the home conditions report does not contain a valuation, and the question of a change in the market does not apply, and in most cases the physical nature of the property will not significantly have changed within a period that it is likely to be on the market, we are therefore not statutorily requiring renewal of the home conditions report. Should the seller decide that he needs to update that information or if the information is sufficiently old for buyers to be somewhat put off by the age of it, then clearly the buyer and his professional advisers might think it sensible to provide an updated report. But it does not seem sensible for us to put that in the statute.
Lord Phillips of Sudbury: My Lords, before the Minister sits down, he said three times that no one in the Chamber has come up with anything better than the provisions. Will he accept that it is the job of government to produce a Bill that makes things better? Does he further accept that he has not had a single speaker in this Second Reading debate supporting the proposals in Part 1 of the Bill?
Lord Whitty: My Lords, I certainly accept the noble Lord's description of the debate. I would, however, say that there are a wide range of people out there, including the Consumers' Association, many professions, and the majority of people we consulted in our various surveys who recognise the provisions as an improvement. There may be other improvements which can also be made. Indeed, we are pursuing some of them. We believe that this is an improvement. Although the House, as constituted today, does not accept that argument, we believe that we have support out there. We can make this work, and work to the benefit of both buyers and sellers.

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On Question, Bill read a second time, and committed to a Committee of the Whole House.

Election Publications Bill [H.L.]
11.19 p.m.
Lord Davies of Oldham: My Lords, on behalf of my noble friend Lord Bassam of Brighton, I beg to move that this Bill be now read a second time.
The circumstances that have given rise to this three-clause Bill are unusual and unexpected. The House will recall that in the previous Session we enacted what is now the Political Parties, Elections and Referendums Act 2000. Following consultation with the main political parties, the substantial part of that Act was brought into force on 16th February. For reasons which I shall explain, we now need to suspend the commencement of those provisions of the Act relating to the imprint on election material. That is the one and only purpose of the Bill.
A number of your Lordships have, at one time or other, shared with me the privilege of seeking election to the other place. They will be familiar with a long-standing provision, in Section 110 of the Representation of the People Act 1983, requiring the printer's and publisher's name and address to appear on election publications.
In taking forward the Political Parties, Elections and Referendums Bill, we made a number of changes. First, we amended Section 110 itself. We believed, and still believe, that what I shall term the "old Section 110" was not entirely satisfactory. There was some uncertainty about who was the "publisher" of an election leaflet or poster. The provision did not readily operate in the case of material in a non-print format, such as videos and websites. Secondly, the provision did not apply to national advertising promoting a party rather than the individual candidate. It was one of the central purposes of the Bill to bring national party expenditure under control.
Each of those points was addressed in the Act as passed. Paragraph 14 of Schedule 18 to the Act substituted a new Section 110 of the 1983 Act. It replaced a requirement to name the publisher with a requirement to identify the promoter—that is, the person who caused the material to be published—and the person on behalf of whom the material was being published; that is, the candidate or third party as the case may be. In addition to the new Section 110 of the 1983 Act, Section 143 of the Political Parties, Elections and Referendums Act introduced similar imprint requirements in respect of national election material. To complete the picture, although it is not directly relevant to this Bill, Section 126 of the Act also introduced imprint requirements in respect of referendum material. Those requirements, too, are in the same terms as the revised Section 110.
In December last year, we consulted the main political parties and the Electoral Commission on the commencement timetable for the Act and, in
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particular, on those provisions amending the Representation of the People Act 1983. The view was then taken that a number of the amendments to the 1983 Act should be deferred until 1st July so as to allow the parties sufficient time to familiarise both themselves and their prospective candidates with the various changes. But we felt that some of the other provisions, including the Section 110, should be brought into force as soon as possible as part of the package needed for applying the new expenditure control provisions. None of those consulted raised any difficulty in that regard. A commencement order was duly made on 29th January. Among other things the order brought the new Section 110 of the Representation of the People Act and Section 143 of the Political Parties, Elections and Referendums Act, together with a number of other provisions, into force on 16th February.
Now I come to why we are bringing forward this short Bill. With the benefit of hindsight, the commencement of these two provisions—Section 143 of the Act and the revised Section 110 of the 1983 Act—was premature. By 16th February, parties and prospective candidates were already gearing themselves up for the county council elections on 3rd May and, no doubt, a possible early general election. Many candidates and local parties were either unpacking old campaign literature from their constituency party cellars or sending off to the printers new material for use during the forthcoming campaign or campaigns. Much, if not all, of this material would have had the old "printer and publisher" imprint on it rather than the details now required by the new Section 110. The same story applied to national material which, until February, only had to bear the name and address of the printer, in accordance with an 1869 statute.
As a result, we are faced with the prospect of going into the forthcoming elections with all the main parties, together with thousands of candidates up and down the country, having large stocks of election publications which do not comply with the new imprint requirements. In theory, it would be open for the parties and their candidates to pulp all this material and start again. But I do not believe—and it is clear that the political parties do not believe—that that is a realistic or practical option. The only alternative is primary legislation, and hence this Bill.
While the problem is a significant one for the parties, the proposed remedy is relatively simple and I can explain briefly the thrust of the Bill. Clause 1 suspends the commencement of both Section 143 of the 2000 Act and the new Section 110 of the Representation of the People Act 1983. These two provisions are not repealed. but they are deemed not to have come into force. The natural corollary of this is that the status quo, as at 16th February of this year, is restored. To that end, the old Section 110 is reactivated.
Clause 2 enables Section 143 of the 2000 Act and the new Section 110 of the 1983 Act to be re-commenced by order. Given the history of these provisions, it clearly would not be sensible to do this for a period of

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months. And in any event, we would wish to consult both with the Electoral Commission and the political parties before any decision is taken.
Clause 3, as well as containing the usual Short Title and extent provisions, includes a saving for any election publication which complies with the new Section 110. The saving will apply during the period beginning 16th February 2001 and ending with the date on which the new Section 110 is brought back into force. In effect, during this "continuation period", local material which complies either with the old or with the new Section 110 would be lawful. It clearly would not be right to penalise any person who, in the period since 16th February, had meticulously arranged matters so as to be able to comply with the new imprint requirements.
It is unfortunate that we have to legislate on this matter a mere four months after the Political Parties, Elections and Referendums Bill received Royal Assent. In doing so, however, we are responding to representations from the two parties opposite, as well as from my own party. The Electoral Commission has also expressed sympathy for the predicament which parties and candidates alike now face.
I believe that in these circumstances the Bill has all-party support and that noble Lords will understand and accept the need to secure its swift passage. Indeed, while not wishing to curtail legitimate debate, I am merely stating the obvious if I say that this Bill can reach the statute book quickly and therefore achieve its purpose only if there is co-operation from all sides of the House. Nominations for the local elections close on 3rd April and both candidates and parties need to know where they stand as soon as possible. To this end. I commend the Bill to the House.
Moved, That the Bill be now read a second time.—(Lord Davies of Oldham).
11.29 p.m.
Lord Cope of Berkeley: My Lords, one of the catch phrases of Oliver Hardy, in his exchanges with Stan Laurel, must be used in the Home Office more often than in any other Whitehall department. It is, of course, "Here's another fine mess you've got me into".
When the Political Parties, Elections and Referendums Bill was going through this House, the Government moved 665 amendments. One of them, as the Minister said, altered the familiar imprint which all of us whose lives have depended upon elections know so well.
The Home Office never consulted the political parties about this particular change and did not advise the parties of its view of the change until 1st March, some time after the commencement order made it law. The amendment to the Bill which brought in this provision was never discussed at all in the other place because of the operation of the guillotine.
The Home Office guidance of 1st March, a couple of weeks after the provision became law, differed slightly from the advice that my party had received. We can all
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live with that, but we should have been told it before the provisions were brought into force by the commencement order.
As the Minister said, we are in a situation where all the main parties are now in breach of the law and stand to waste millions of pounds on scrapping the tons of pre-printed material stacked up for the council elections and for the general election—which, I think we can assume from the way in which this measure is being handled and the Motion that we passed earlier today, will definitely be on 3rd May, although I am not asking the Minister to comment on that.
If we pass this measure, I suppose that a small forest of trees will be saved from being turned directly into waste paper. So, in that sense, it is an environmental measure—although I do not think that even this Government would have the cheek to claim it as such.
We can all understand how it happened, but we should recognise that we, the political activists, are the only people who can pass our own "excuse me" Act and secure our own collective immunity from ignorance of the law. Small businesses struggling under the burden of regulations will view us with envy.
The message should be quite plain: there is too much new legislation for anyone to absorb—and nowhere more than in the Home Office. A dozen Acts of Parliament last year; already six Home Office Bills in this truncated Session; two new Second Readings this week and another one on Monday.
I make no apology for making these points because I made them in the debate on the Bill when we discussed the amendment under consideration now. I said:
"The fact that these huge changes have been made to a comparatively simple part of the Bill emphasises part of the Home Office's problem this year: it has had too many Bills. It has not been able to draft them properly".—[Official Report, 18/10/00: col. 1144.]
The Minister mentioned the question of imprints on websites and e-mail, which were also part of the Bill. These are subject to regulations and were supposed last October to be urgent. But I understand that nothing has happened. It would be helpful if the noble Lord could tell us, either today or in writing, whether websites will have to have imprints as anticipated in the coming elections—council or otherwise—and, if so, when we will see the necessary regulations.
I made the point in October that we would need clear regulations and guidance well before the council elections, even if there was not a general election, but I do not think that we have seen anything about them as yet. Many more websites will be used by candidates in this general election. Some of us, including me, had websites at the last election, but more will no doubt have them, and much better ones, this time. The matter was described as urgent in October by the noble Lord, Lord Bach, who was taking the provision through., and of course it is all the more urgent now.
This is a nasty little mess, but the Bill is required in order to get us out of it.
11.34 p.m.
Lord Goodhart: My Lords, last Saturday morning, when I was doing my usual round delivering party literature to my neighbours, it did not occur to me—no doubt it should have done—to check the imprint. I now realise that I may well have been participating in a criminal offence.
Be that as it may, this is an interesting Bill. I am familiar, as we all are, with Acts that contain provision for commencement orders. This is the first occasion on which I have come across a measure that contains a "de-commencement" order.
The noble Lord, Lord Cope, referred to the fact that this is an environmental Bill in that it saves vast quantities of newsprint from having to be pulped—a point with which I am sure we all agree. My party has always been very keen on protection of the environment. For that reason, if for no other, I am happy on behalf of my party to welcome the Bill.
11.36 p.m.
Lord Davies of Oldham: My Lords, I am grateful for those responses from the noble Lords opposite—although I should attest to the fact that I did not introduce the Bill as an environmental measure. However, as both noble Lords identified, if that gain is one of the effects of the Bill I am happy to have their support in that respect.
I am not sure that the description of the noble Lord, Lord Cope, is quite fair: he said what a fine mess we have got into. Among his many delightful characteristics, Lord Cocks of Hartcliffe, who is sadly missed, enjoyed Oliver Hardy above every other experience in film. I can almost hear him using the phrase now. So I accept it from the noble Lord in the friendly way in which he presented it. He has obviously identified the fact that we are in a situation that we should very much prefer not to be in.
I accept the noble Lord's point that we have a remedy to hand through the passing of this Bill that would not be so easily achieved in other circumstances. Important though small businesses are, and I attest to that obvious point, political parties and the successful and proper conduct of our democracy probably rate a good deal higher in terms of the needs of the nation. That is why, when we have difficulties such as this which cause all political parties substantial problems, it is proper that we remedy them as early as we are able to do so.
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The noble Lord, Lord Cope, erred slightly on the side of unfairness: the issue has not arisen as a result of shoddy drafting of the Act or the work of Home Office Ministers in that respect. There is nothing wrong with the drafting of the Act. The problem relates to the timing of the commencement and the impact that it had on parties which had already had election material printed. That is the nature of our difficulty.
Lord Cope of Berkeley: My Lords, I apologise for interrupting. I am grateful to the noble Lord for giving way. The point that I was trying to make—evidently not clearly enough—was that this matter was introduced as one of over 600 amendments. That is why it was not noticed nearly so much as it would have been had the measure been properly drafted in the first place and had it not required so many amendments.
Before I sit down, perhaps I may say a word about Lord Cocks. I agree with what the noble Lord said. Lord Cocks was a good friend. I knew him well. We served together in another place in our various Whips' offices and had a good deal to do with one another. He was also a constituency neighbour. We shall all miss him a great deal. We shall particularly miss his humour and his company.
Lord Davies of Oldham: My Lords, I very much appreciate the tenor of those remarks from the noble Lord. I hear what he says about drafting. I believe that he will recognise that the Bill we eventually passed was successfully, properly and accurately drafted as regards this issue. The problem has arisen from the commencement orders.
The noble Lord asked me one particular question about websites. With this measure, we have suspended Section 143 of the 2000 Act and new Section 110 of the Representation of the People Act 1983. We have, therefore, suspended the regulation-making power, so there will be no regulations governing non-print material this side of the May local elections.
I appreciate once again the response of the two noble Lords who have spoken. We are all in a difficult situation. It is recognised that outside people are watching this occasion with very great interest because we are right up against the deadlines for the May local elections. Therefore, we have to move with considerable expedition if we are to remedy what is recognised to be a very real problem. I therefore commend the Bill to the House.
On Question, Bill read a second time, and committed to a Committee of the Whole House.
House adjourned at eighteen minutes before midnight.