HL Deb 07 March 2003 vol 645 cc1082-100

2.23 p.m.

Lord Goodhart

My Lords, I beg to move that this Bill be now read a second time.

The Bill has one obvious virtue: it is very short. Its purpose is to link the salary of the Lord Chancellor to that of a Secretary of State, instead of to that of' the Lord Chief Justice. Roughly speaking, it would halve the salary of the Lord Chancellor. Under present legislation, the Lord Chancellor will he entitled to £202,000 from 1st April, although the present holder of that office said that he would, for the time being, draw only £184,000. Under the Bill, the Lord Chancellor would get about £97,000, the same salary as the Leader of the House of Lords.

I should make it absolutely clear that the Bill is not in any way intended as a personal attack on the noble and learned Lord, Lord Irvine of Lairg, as the present Lord Chancellor. He is someone for whom I have the utmost respect—except, perhaps, for his views on the reform of your Lordships' House. I do not wish anything I say, nor do I wish anything in the Bill, to be taken as a personal attack.

The Bill is moved in support of a constitutional principle. On these Benches, we believe that the office of Lord Chancellor has moved, is moving and ought to continue to move away from being a judicial office and towards being a ministerial and political one. That should be recognised by giving the Lord Chancellor a ministerial salary rather than a judicial salary.

At present, the Lord Chancellor is entitled to a higher salary than the Prime Minister and approximately one-and-a-half times the salary of a Cabinet Minister in another place. Cabinet Ministers receive part of their MP's salary, as well as their ministerial salary. The Lord Chancellor is entitled to approximately double the salary of the Leader of the House—the only other Cabinet Minister in your Lordships' House. That is a historical anomaly.

The noble and learned Lord, Lord Irvine of Lairg, is not here today. That is correct—because of his personal interest in the matter he could not take part in the debate. He would be wasting his time to sit and listen. No doubt he will read it in Hansard.

I am delighted that the noble and learned Lord, Lord Mackay of Clashfern, the only living former Lord Chancellor, has come from Scotland to speak on this occasion. I expect him to give a vigorous defence of the present arrangements. If that is so, it will be a welcome contribution to the debate.

We need to start with a little history. The office of Lord Chancellor has always been traditionally well paid. Much of the background to the salary situation is set out in the report of the Committee on the Remuneration of Ministers and Members of Parliament, chaired by Sir Geoffrey Lawrence QC, published as Command Paper 2516 in November 1964. I should add that my wife was a junior member of the secretariat of that committee.

In 1830, a Select Committee recommended that the salary of the First Lord of the Treasury, and other senior Cabinet Ministers—except for the Lord Chancellor—should be £5,000 per year. That recommendation was accepted by Parliament. In 1832, following the report of the same Select Committee, Parliament gave the Lord Chancellor an aggregate salary of £14,000 per year. That was more than twice the salary that the Prime Minister—or the First Lord of the Treasury, as he was then called—received and was equal to £700,000 per year at today's values. The sum was made up of £4,000 as Speaker of your Lordships' House and £10,000 paid as a judicial salary.

In 1851, the two salaries were merged and the aggregate salary of the Lord Chancellor was reduced to £10,000. Therefore, this Bill is not unique in proposing a reduction in the Lord Chancellor's salary—in 1851, a substantial reduction occurred. From the 1830s onwards, High Court judges received £5,000. I am not sure what the Lord Chief Justice received in those times because that post came into existence only in the 1870s with the merger of the three old common law courts, each of which had its own Chief Justice.

By the time of the Supreme Court of Judicature (Consolidation) Act 1925, the Lord Chief Justice received £8,000 per annum. There were some increases after the Second World War as a result of higher inflation.

In its 1964 report, the Lawrence committee recommended an increase to £18,000 per year for the Prime Minister, £17,000 per year for the Lord Chancellor and £12,000 per year for other Cabinet Ministers. Those recommendations were not implemented in full. Two Acts were passed in 1965; the Judges Remuneration Act and the Ministerial and other Salaries Act. Under the Judges Remuneration Act, the Lord Chancellor received £14,500 and the Lord Chief Justice £12,500. Under the Ministerial and other Salaries Act, the Prime Minister received £14,000, which was £500 less than the Lord Chancellor. Other Cabinet Ministers received £8,500. Until that date, therefore, the Lord Chancellor's salary had been treated as a judicial salary.

In the Ministerial and other Salaries Act 1972, the Lord Chancellor's salary was for the first time treated as a ministerial salary, but he continued to be paid a sum which was much greater than that of a Cabinet Minister. At that stage, the Lord Chancellor and the Prime Minister both received £20,000 a year and a Secretary of State £13,000, all subject to increases by statutory instrument to match inflation. Those figures were repeated in the Ministerial and other Salaries Act 1975, an Act which is still in force, subject to later amendments.

Since the Administration of Justice Act 1973, judicial salaries have not been fixed by Parliament. They are fixed by the Lord Chancellor with the approval of the Treasury. Finally, the Ministerial and other Pensions and Salaries Act 1991 provided that the salary of the Lord Chancellor, which was by then fixed at £91,500, should thereafter be £2,000 above that of the Lord Chief Justice. That gave effect to the recommendation of the Top Salaries Review Board in 1983. The 1991 Act has the incidental effect that, technically, the Lord Chancellor has power, by deciding on the salary of the Lord Chief Justice, to decide his own salary, though of course subject to Treasury consent.

The 1991 Act as a Money Bill received only a short debate in your Lordships' House. I have looked at the Second Reading debates in both Houses to see whether anything relevant to the Lord Chancellor's salary was discussed and I discovered only one brief exchange in your Lordships' House. On 26th February 1991, my noble friend Lord Mackie of Benshie said:

I understand that the Lord Chancellor receives an enormously greater salary than the Prime Minister. Can he say whether that is so because the Lord Chancellor is worth more, because he works harder, or because lawyers in this country are grossly overpaid?". To that, Lord Cocks of Hartcliffe responded:

I should point out that the Lord Chancellor receives an additional payment because he is well worth it". Finally, the noble Lord, Lord Waddington, winding up as Leader of the House, said:

I do not know whether I should now embark upon a long explanation as to why the Lord Chancellor is paid more than the Prime Minister. I shall leave that issue for another day".—[Official Report, 26/2/91; cols. 873–75.] Another day is today because there have been no intervening debates on the subject. And in order to show how little changes over time, I point out that immediately after the debate from which I have quoted, the House went on to hear a Statement about the Gulf War.

The Lawrence committee considered at some length the justification for paying the Lord Chancellor such a high salary compared with other Cabinet Ministers. Paragraph 136 of its report states:

We are of the opinion that the total salary of the Lord Chancellor should be increased in order to preserve a marked difference of remuneration consistent with the eminent nature of his office and with his position as the head of the judicial hierarchy of England entrusted with the great responsibility of recommending appointments to judicial office. Moreover, the office of Lord Chancellor, in our opinion, should continue to be an object of ambition to the ablest members of the Bar as the highest position constitutionally open to them as lawyers. The Lord Chancellor's salary therefore should be set at a level acceptable to such leaders of the Bar as have the outstanding qualities and attainments required for discharge of the manifold duties of this great office". That sounds like something from another age. Indeed, my wife, as a member of the secretariat, felt so at the time.

The first justification mentioned is the special responsibilities of the Lord Chancellor. Frankly, as an explanation or justification, that will not wash. Of course the appointment of judges is a matter of great constitutional importance, but we have to ask whether the responsibilities of the Lord Chancellor are greater than those of the Chancellor of the Exchequer, the Foreign Secretary or the Home Secretary, the three traditional great offices of state. Are the responsibilities of the Lord Chancellor necessarily even greater than those of, for instance, the Secretaries of State for Defence and Health?

As to the need to pay high salaries to obtain suitable candidates for the office, the proof of the pudding is in the eating—or, in this case, the disproof of the pudding. The ministerial Benches include the noble and learned Lords, Lord Williams of Mostyn, Lord Falconer of Thoroton and Lord Goldsmith, and the noble Baroness, Lady Scotland of Asthal—all of them barristers of the highest ability; any of whom would be an admirable choice for the office of Lord Chancellor; and each of whom would be able to earn far more in private practice than they do as a Minister. But each of them has accepted a government post for a salary which is far less than that of the Lord Chancellor.

The role of the Lord Chancellor as an active head of the judiciary is now, frankly, fictional. The Lord Chancellor hardly ever sits as a judge. In response to a Written Question of my noble friend Lord Lester of Herne Hill, it was disclosed the other clay that the noble and learned Lord the Lord Chancellor sat not at all in 2002 and in one case lasting for three days in 2001. Under the European Convention on Human Rights and the Human Rights Act, the Lord Chancellor cannot sit in any case in which the Government have an interest. Many lawyers consider that he should not sit at all.

Of course the Lord Chancellor's role as Speaker of your Lordships' House is now largely nominal. It is, frankly, a waste of the time of a Lord Chancellor. Why should a Lord Chancellor spend half an hour a day, dressed up in fancy dress, listening to questions?

By contrast, the political and administrative role of the Lord Chancellor has increased greatly. The Lord Chancellor's Department is large, with a very large bill, and it will become larger when the staff of the magistrates' courts are absorbed into it. At that point it will have a staff of approximately 25,000 people.

The responsibilities of the Lord Chancellor's Department now go well beyond the traditional ones of the judiciary, the court system and civil law. After the last election, the Lord Chancellor's Department took over from the Home Office responsibility for the Freedom of Information Act and the Data Protection Act. Since then, it has also taken over responsibility for elections. The department has general responsibility for constitutional law. Indeed, apparently it wishes to restyle itself as the "Department for Justice, Rights and the Constitution".

The present Lord Chancellor is far more politically active than was the noble and learned Lord, Lord Mackay of Clashfern. The noble and learned Lord, Lord Irvine of Lairg, heads several Cabinet committees and is a big fish in the political pond. He is seen as a politician. In the public's view, it is not him but the noble and learned Lord, Lord Woolf, the Lord Chief Justice, who is seen to be the real head of the judiciary. It is of course the noble and learned Lord, Lord Woolf, and not the Lord Chancellor, who has in the past few days defended the judiciary against the intemperate attacks of the Home Secretary.

The office of Lord Chancellor is becoming almost indistinguishable from that of any other Cabinet Minister. The only remaining function of the Lord Chancellor that is distinctive is his role in the appointment of judges. I have no criticism at all of the judicial appointments made by the noble and learned Lord, Lord Irvine of Lairg—the appointments made by his predecessor are, by common consent, quite outstanding—but we cannot assume that the standards will always be so high. We on these Benches, together with many lawyers and organisations such as Justice, believe that the appointment of judges should now be made by an independent judicial appointments commission. If this happened, the Lord Chancellor's Department would become simply a ministry of justice, headed by a Minister who need not be a lawyer and who might well sit in the House of Commons. I do not think, therefore, that there is any justification for paying the Lord Chancellor twice as much as his colleague, the Leader of the House.

I turn to two final points. First, the Bill does not deal directly with the Lord Chancellor's pension. The pension would, of course, be reduced in consequence of the reduction in the salary to which it is linked. The Lord Chancellor's pension—uniquely—is not linked to the length of his term of office. That is to a limited extent, although not wholly, justified by the fact that the Lord Chancellor, as the holder of a judicial office, cannot return to practice, unlike the Law Officers or other Ministers who are lawyers. Once the Lord Chancellorship ceased to be a judicial office, the Lord Chancellor, if a lawyer, could return to practice. But then, the justification for a full pension, however short the term of office, would end, even if it is justified now.

Secondly, the Bill is intended to come into effect on 1st April 2004. That date has been chosen not as All Fools Day but as the beginning of a financial year. Even with the help which I fully expect the Government to give to this Bill as a useful contribution to the reduction in public expenditure, I do not expect it to become law by 1st April this year.

I believe that it is right, and timely, that the salary of the Lord Chancellor should be the same as that of a Secretary of State. I beg to move.

Moved, That the Bill be now read a second time.—(Lord Goodhart.)

2.42 p.m.

Lord Mackay of Clashfern

My Lords, it is a privilege to follow the noble Lord, Lord Goodhart, particularly when he wrote to me saying that it would be welcome were I to speak in this debate. I received from his letter the impression—at which he has at least hinted—that I might not be entirely in favour of his proposals.

As your Lordships know, I held the distinguished office of Lord Chancellor for almost 10 years. Therefore, I must have some kind of interest—although essentially academic—in the Bill. I do not believe that the Bill as it stands would affect my personal position.

Like the noble Lord, Lord Goodhart, I propose to approach this matter on the basis of the Lord Chancellor's office; I do not propose in any way to discuss the situation so far as concerns my successor, the noble and learned Lord, Lord Irvine of Lairg.

The Bill seeks to equiparate the Lord Chancellor's salary with that of a Secretary of State. It is suggested by the noble Lord, Lord Goodhart, that in practice the Lord Chancellor's position has become that of a Secretary of State. In my submission that is obviously not correct.

The Lord Chancellor is, first of all, a judge. On taking office, he takes a judicial oath as Lord Chancellor, usually administered by the Master of the Rolls in the presence of all the senior judges of the Supreme Court. He is president of the Supreme Court, and president of the Chancery Division of the High Court of Justice. He provides the administration for all these courts and for county courts and the Crown Court. If the proposals presently before Parliament become law, he will also provide the administrative support for magistrates' courts throughout the country.

I regard the provision of administrative support to the judges and the way that the Lord Chancellor's Department is organised as part of the judicial administration of judicial functions. For example, the Lord Chancellor provides the listing officers in the various courts. Listing is a judicial function: it is done by the listing officers in the name of, and on behalf of, the judges who are in administrative positions at the various courts, such as the resident judge in a normal combined court centre.

That administrative provision is made by the Lord Chancellor. In my view, it is extremely important that that administration should be seen as provided by one who holds the office of a judge and who, as I said, has taken the judicial oath, as Lord Chancellor, to do right to all manner of persons according to the laws and usages of this realm without fear or favour, affection or ill-will. In that capacity, he is discharging an important judicial function.

The noble Lord, Lord Goodhart, referred to the appointment of judges, and I need not refer to that again. I am grateful for his comment upon the appointments that I was instrumental in proposing while in office. It is an extremely important part of the Lord Chancellor's function and I think I am right in saying that one of my noble and learned predecessors, Lord Hailsham of Saint Marylebone, said he thought it was perhaps the most important part of the Lord Chancellor's function. I would not necessarily say that it is more important than some other parts, but it is certainly very important.

My third point relates to complaints against judges, which the Lord Chancellor is responsible for dealing with. In my view, it is very important for the independence of the judiciary that complaints against it are dealt with by a judge, a member of the judiciary himself. So there is a very close arrangement of judicial functions, apart from sitting in court.

As has been mentioned, the Lord Chancellor is a Lord of Appeal and therefore entitled to sit in judicial proceedings of the committees of this House, and when he sits, he presides. He is also, by statute, a member of the Judicial Committee of the Privy Council and again, when he sits there, he presides. I sat with the present Lord Chancellor a year or two ago in a case in the criminal law area.

The extent to which any Lord Chancellor sits from time to time is often a matter of' circumstances and personal convenience. So far as I am concerned, I do not regard it as in any way preventing the Lord Chancellor from sitting that he is a member of the Government. When he sits, he sits as a judge, with the responsibilities of a judge incumbent upon him. I believe that the Lord Chancellor. like any other judge, will not sit in a case in which any bias or party interest is reflected, but that applies to every judge. In that respect, the Lord Chancellor is no exception.

I believe that it is correct, as the present system provides, that the Lord Chancellor is salaried on the basis of the judicial office that he holds. He is not a Secretary of State. As your Lordships know, Secretary of State is an office held by a number of people, all of whom are equivalent in parliamentary terms. It is not usual to designate particular Secretaries of State in Acts of Parliament although that can happen. However, the Lord Chancellor has no power to execute any of the functions of a Secretary of State, nor does any Secretary of State have power to exercise the functions of the Lord Chancellor except in very rare circumstances provided for in an Act of Parliament. Generally speaking, however, there is no question of any Secretary of State being able to perform the Lord Chancellor's functions. The offices are quite distinct. No Secretary of State takes a judicial oath or in any way holds office in any of the courts of this country or is entitled to sit.

One of the consequences of all this, certainly in modern times, is that persons appointed as Lord Chancellor have been regarded as persons with sufficient experience and standing in the law to be able to preside with appropriate competence in the highest courts in this country. In that situation, it is only right that the salary should be on the basis of the appointment—as a judicial appointment and as the head of the judiciary. It is for that reason that the salary arrangements are as set out by the noble Lord, Lord Goodhart, with a small lead over the Lord Chief Justice, reflecting the Lord Chancellor's place in that hierarchy. The current lead is £2,500, which is less than any percentage lead that is likely to be awarded. I think that on the current basis, at the Lord Chancellor's current level, if 1.5 per cent were awarded, the lead would be more than £2,500. So a fixed lead would in fact be a diminution from what would be expected if the ordinary arrangement of percentage increases were allowed.

When I was first introduced to the office of Lord Chancellor, I was told by a well-informed department that the Lord Chancellor's office dated from 602. 'The earliest appointment that could be traced was in 602. So it is a fairly ancient office. It has developed over the years. I believe that it is a very important part of what our constitutional history has provided for us. It has provided that the head of the judiciary is a Member of Parliament and responsible to Parliament for the proper performance of the important judicial aspect of government.

As has been said, the Lord Chancellor can be removed from office summarily, without any notice, although he then automatically becomes a Lord of Appeal, entitled to sit in the House of Lords in that capacity. He is therefore in a unique position to be answerable to Parliament for the way in which the judicial functions of the state are performed. Any other judge will have security of tenure and cannot be answerable to Parliament in the same way. It is a unique provision provided by our constitutional history. I certainly think that. on the basis of the arguments we have heard so far, it is one that we should seek to preserve.

In the current situation I believe it right to say that this Bill cannot properly proceed if the present office of Lord Chancellor remains as it is. Accordingly, I submit to your Lordships that on that basis this Bill should not be supported. But I also take the view that it would be a mistake to modify the office of Lord Chancellor along the lines suggested by the noble Lord, Lord Goodhart.

I note with interest that the noble Lord, Lord Lester of Herne Hill, will speak on behalf of the Liberal Democrat Benches. When I was Lord Chancellor I remember being invited by the noble Lord, Lord Lester, to a human rights conference in Oxford. He kindly invited me to preside at that conference. He made very clear to my private secretary that he invited me in my capacity as a judge, not in my capacity as a Cabinet Minister. That is still the position. The noble and learned Lord, Lord Irvine of Lairg, is a judge just as much as I was. Therefore, it would be quite wrong to alter the situation in which his salary is presently determined.

The combination of functions to which I referred being in the hands of someone competent to exercise judicial office at the highest level is an important feature of the independence of the judiciary in this country and also an important feature of the way in which the three arms of government are in harmony although in tension. It is sometimes suggested that the Lord Chancellor's office is a breach of the doctrine of the separation of powers. One often hears that referred to. What one does not hear so often referred to is that the three powers in question are the executive, the judicial and the legislative branches. In our country the executive branch is entirely made up of members of the legislative branch. I think I am right in saying that at the moment all Ministers of the Crown are Members either of your Lordships' House or of the House of Commons. So there is a terrifically strong link there. The link that exists in the Lord Chancellor between the judicial and the executive branches has been tried and formed by our history and is surrounded by important conventions. It is an office that I hope will long continue.

I think I am right in saying that the late Lord Elwyn-Jones said that he spent a lot of his time as Lord Chancellor trying to ensure that he would not be the last. He was successful in that. To that extent I succeeded also and I hope that many of our successors will have the same success.

2.58 p.m.

Lord Lester of Herne Hill

My Lords, it is a particular pleasure and privilege to speak after the noble and learned Lord, Lord Mackay of Clashfern. He exemplified the extraordinarily powerful advocacy that I am told he displayed at the Scots Bar and when he defended some of the measures that the government of which he was such a distinguished member introduced. I well remember that.

If he will allow me to say so, the heritage that he left behind as Lord Chancellor, and which I particularly cherish, is threefold: first, the way in which he upheld the independence of the judiciary as Lord Chancellor; secondly, the way in which he persuaded members of my profession, the English Bar in particular, to reform that profession and remove many of its restrictive practices—I was among those who keenly supported those reforms—and, thirdly, and perhaps most importantly, the extraordinarily enlightened judicial appointments that he made, the benefits of which we see today in our senior judiciary.

My only disappointment, if I may say so without impertinence, is that I never persuaded the noble and learned Lord, Lord Mackay of Clashfern, that there was anything in the far-reaching constitutional reforms for which I, my party and many others pressed during his period in office. In particular, we never persuaded him at all of the kind of reforms that underlie my noble friend's Bill, in relation to the office of Lord Chancellor.

We should be grateful to my noble friend for introducing such a significant constitutional measure, and for the way in which he explained the issues and background. Like the previous speakers I want to emphasise for the avoidance of doubt that, in our support for the Bill, we do not regard it in any way as a personal attack on either the noble and learned Lord the Lord Chancellor or the office of Lord Chancellor.

I want to give a little more background and add a little more colour to the issues, if I may. The Ministerial and other Salaries Act 1975 that the Bill seeks to amend was enacted when the Lord Chancellor was the genial and companionable Lord Elwyn-Jones, whom many of us remember with particular affection. His autobiography, In My Time, which has been referred to, contains much sartorial and other information about the office of Lord Chancellor. In addition to describing his three hats as Speaker, head of the judiciary and Cabinet Minister, he also described his ceremonial clothing in great detail.

Lord Elwyn-Jones was also pleasurably expansive about other aspects of the Lord Chancellor's pomp, such as his two maces and his,

large, heavily tasselled purse of crimson velvet embroidered in gold thread with the royal arms and the lion and unicorn with attendant cherubim". That was originally used to hold the Great Seal. It is now normally carried empty, although it is used to hold the text of the Queen's Speech at the state opening of Parliament.

Nowhere in Lord Elwyn-Jones's autobiography did he mention that Parliament had given him and his predecessors a very fine salary, equal to that of the Prime Minister and much greater than the salary of the Chancellor of the Exchequer, the Foreign Secretary or the Home Secretary, all of whom had been elected by the people as Members of Parliament. Nowhere did he mention that although his large ceremonial purse is normally empty, the Lord Chancellor's own purse is amply filled out of the Consolidated Fund, in addition to the considerable public expenditure on his palatial apartment. As has been said, in 1983, the Top Salaries Review Board—a very distinguished body indeed—presided over by Lord Plowden, recommended that the Lord Chancellor should receive £2,500 more than the Lord Chief Justice, in recognition of his role as head of the judiciary. That was passed by affirmative resolution procedure year on year. The reasons given by the review board are interesting. It noted that determining the Lord Chancellor's salary presented difficulties because of the special nature of the job. It stated:

The Lord Chancellor has several roles: as a Minister and as head of department; as the constitutional head of the judiciary; and in presiding over the House of Lords. When deciding our recommendations we have to consider both the ministerial and the judicial pay structure. This has led us to conclude in previous reviews that the salary of the Lord Chancellor should be the same as that of the Lord Chief Justice. We have considered this relationship again in this review. Having regard to the pre-eminent position of the Lord Chancellor in the judiciary and his responsibilities as a whole, we have concluded that a more appropriate relationship would be established if he were to be paid rather more than the Lord Chief Justice. We recommend that the appropriate salary for the Lord Chancellor…is £62,000. The recommended salary also includes an element of £8,500 to be paid in recognition of the Lord Chancellor's function in presiding over the House of Lords. In making this recommendation, we have been concerned to set the appropriate salary for the position, and have taken no account of the fact that the present Lord Chancellor does not draw the full salary". The fact that Lord Hailsham of Saint Marylebone, as Lord Chancellor, had decided not to draw the full salary is surely of some significance. It suggests that he, a most distinguished holder of that office, regarded the amount awarded to him as excessive. However, in 1991, as the noble Lord, Lord Goodhart, mentioned, the 1975 Act was amended so that that £2,500 automatic increment was prescribed in primary legislation without the need for further parliamentary approval by the affirmative procedure.

Those events occurred long before the enactment of the Human Rights Act 1998, which incorporated the European Human Rights Convention into UK law and long before the important judgment of the European Court of Human Rights in McGonnell v United Kingdom in February 2000.

Times have changed in other ways. It was no doubt true in Lord Elwyn-Jones' time, as his autobiography records, that Cardinal Wolsey's term of office marked the high point in the power and influence of the Lord Chancellor. But that is no longer so. The power and influence of the present Lord Chancellor is unequalled as a heavyweight Cabinet Minister and close confidant of the Prime Minister. Without surrendering any part of his ministerial patronage, he has added greatly to the powers of his department and to the public funds at his disposal. He has great responsibilities—greater than any modern predecessor. However, as the noble Lord, Lord Goodhart, said, they are no greater than those of the Prime Minister or his other senior colleagues.

In one other significant respect, his position has significantly altered. Although, as the noble and learned Lord, Lord Mackay of Clashfern, said, he remains head of the judiciary, that is in a nominal sense. In practice, he has had to abandon sitting in a judicial capacity because of the need to comply with Article 6 of the convention and with modern constitutional principles about judicial independence and the separation of judicial from executive and legislative powers. That change is widely welcomed not only on these Benches but by the Law Lords themselves.

The description by the noble and learned Lord, Lord Mackay, of the Lord Chancellor as head of the judiciary is, as I said, entirely correct in theory, but not in practice. I respectfully suggest that the administrative support that is given by his department to the courts is more an executive function than a judicial function and, in any case, could not justify an inflated salary.

The changes mean that any justification for the increment has been eroded, if not altogether destroyed. We now have the report of Mr Erik Jurgens about the office of the Lord Chancellor, which, if approved by the Parliamentary Assembly of the Council of Europe, would invite the UK to review the office in such a way that the Lord Chancellor's judicial function is no longer combined with membership of the Cabinet and with presiding membership of a Chamber of the legislature. I believe that similar concerns have also been raised internationally within the Venice Commission for Democracy. This has become an internationally important issue. I should add that, even if the Lord Chancellor continued to sport three hats, it would be profoundly unsatisfactory if there were to be a personal financial incentive for him to sit judicially in order to seek to preserve his inflated salary. I am sure that that is not the case.

Another change, which was noted in the autobiography of the noble and learned Lord, Lord Rawlinson of Ewell, is that,

in 1988, for the first time in history the judges felt impelled to appoint from among their number a Council of Judges, a council which is presumably intended to be the representative body designed to look after the interests of the English judges who in former times were content to leave the protection of their constitutional independence in the hand of a Lord Chancellor". To revert to Lord Elwyn-Jones' autobiography, he noted that the Lord Chancellor,

still takes precedence over all ministers of the Crown, even the Prime Minister. He ranks in precedence after the Royal Family and the Archbishop of Canterbury". Nothing in the Bill of the noble Lord, Lord Goodhart, would alter the Lord Chancellor's exalted status or diminish the splendour of his antique garb. Nothing in the Bill would diminish the Lord Chancellor's recently expanded ministerial empire. The sole anomaly with which it is concerned is the exorbitant remuneration attached to his office.

As several noble Lords have said, the increment awarded to the Lord Chancellor to ensure that he is paid £2,500 more than the Lord Chief Justice is founded on the notion of him as head of the judiciary; a notion, it is argued, which means he should not be paid at the same rate as his fellow Ministers. That might have been acceptable in 1983, when the Lord Chancellor sat frequently in a judicial capacity in the real sense, but these days it is surely anachronistic and an unnecessary drain upon public funds.

There can be no doubt that the present very distinguished incumbent of that great office, who has been known to refer disparagingly to "fat cat QCs", would not wish to be remembered as a fat cat on the Woolsack. When I came to the Bar there was an outmoded practice called the two-thirds rule, according to which a junior barrister had to be paid two-thirds of the fees of a Queen's Counsel, in addition to the amount paid to the QC. I am glad to say that that was eventually abolished. Surely, the present Lord Chancellor should welcome the abolition of a rule requiring him to be paid more than the Lord Chief Justice and much more than his fellow Ministers.

Nor can the present position convincingly be justified on the basis of market forces, that is, on the ground that able candidates cannot be found for the office of Lord Chancellor unless they are paid more than other Ministers. The noble and learned Lord, Lord Williams of Mostyn, who is the Leader of the House, and the noble and learned Lords, Lord Falconer of Thoroton, and Lord Goldsmith. are all examples of Ministers who were willing to sacrifice the possibility of earning much larger sums in private practice so as to devote themselves to public service. I have no doubt that the noble and learned Lord, Lord Irvine of Lairg, would have accepted his appointment as Lord Chancellor if his salary had been equal to that of a senior Minister of the Crown.

Lord Mackay of Clashfern

My Lords, I thank the noble Lord for giving way. I think it would be fair to point out, as the noble Lord, Lord Goodhart did, that the Lord Chancellor as a judge is precluded from returning to practice, whereas I would have thought that the Ministers to whom the noble Lord referred would be able to return to possibly enhanced remuneration in private practice having held such distinguished office in Government.

Lord Lester of Herne Hill

My Lords, I am grateful to the noble and learned Lord for reminding me of that point. I accept that that is a possible ground for distinction under the arrangements which now exist. However, I believe the answer to that is given by my noble friend Lord Goodhart. We would anticipate that consequential changes would need to be made in the course of the next two or three years before the Bill comes into force in order that it would become unnecessary for the Lord Chancellor to be nominally a judge or even necessarily to sit as a Member of this House. In our view on these Benches he could be put into exactly the same position as a Secretary of State, as are the other very distinguished lawyers on the Government side.

It remains for me to refer briefly to that part of the Lord Chancellor's salary that he is paid for acting as Speaker of the House. It would seem appropriate for the level of remuneration for that responsibility to be determined separately by the House, perhaps even on the basis of an hourly rate to be paid to the Lord Chancellor and such other officers of the House as sit from time to time upon the Woolsack. There does not seem any justification for a fixed sum to be included for him alone.

For those reasons we on these Benches hope that the Government will support this modest Bill and remove an anomaly that unjustly enriches whoever is holder of the office of Lord Chancellor and places an unfair and unwarranted burden upon the taxpayer. This is not a case where the emperor has no clothes; the Lord Chancellor has expensive ministerial and judicial clothes, some of which should be shed or reduced or there should be a reduction in the price paid for them by the members of the public.

3.14 p.m.

The Minister for the Cabinet Office and Chancellor of the Duchy of Lancaster (Lord Macdonald of Tradeston)

My Lords, the noble lord, Lord Goodhart, proposes significant amendment of the provisions of the Ministerial and other Salaries Act 1975. The Government cannot support this amendment. The Lord Chancellor has already requested that this issue he considered by the independent Senior Salaries Review Body.

As the Lord Chancellor's remuneration reflects the status and responsibility and tradition of the offices this debate has made clear, there is a wider context, as the noble Lords, Lord Goodhart and Lord Lester of Herne Hill, have also made clear. It has been suggested that by implication, the Human Rights Act might make it inappropriate for my noble and learned friend to continue to exercise any judicial functions.

The Government do not accept that reasoning. In the United Kingdom, we have never accepted pure adherence to a doctrine of the separation of powers. The noble and learned Lord, Lord Mackay of Clashfern, elegantly dissected the arguments, which I would not presume to try to match. He referred to his distinguished predecessor as Lord Chancellor, the late Lord Hailsham of St Marylebone, who in a speech to the committee of Ministers of the Council of Europe in 1979 summed up the position in a way that is worth noting. He said:

Unlike that of the United States, the British Constitution is such that every leading member of the executive is also a member of the legislature. We have an omnipotent, omnicompetent and sovereign parliament and, to some extent, it reflects the will of the executive, but we have an independent judiciary and the function of the Lord Chancellor is precisely to maintain the independence of the courts of law and the judges. We have no written constitution and in the absence of a document we must rely on the integrity of a man. It is the function of the Lord Chancellor to fight, to the last gasp if need be, for the independence of the judiciary. He can perform that function only if he has a foot in all three camps". Therefore, the office of Lord Chancellor, straddling as it does the three parts of the constitution, makes its holder uniquely placed to protect the interests of each part against the demands of the others. In particular, it both upholds judicial independence and mediates between the executive and the judiciary when occasion for controversy arises.

The Lord Chancellor is able to perform that function both because of his seniority in Cabinet and because he is head of the judiciary and sits as such from time to time. Through his office, the judiciary has a representative in the Cabinet. The Lord Chancellor is in a position to promote mutual understanding in order to avoid collisions at the major intersections in the separation of the powers.

It is sometimes suggested that the Lord Chancellor could continue to fulfil that function without himself sitting as a judge. The Government do not agree. Sitting as a judge can give the Lord Chancellor a practical awareness of the development of the common law at the highest level. More than that, the Lord Chancellor's position as head of the judiciary also has the effect of ensuring that only an experienced and senior professional lawyer can be appointed to the position. It is not enough to have a legal qualification; the holder must be practising as a lawyer. A review of the outstanding attributes of the present and former Lord Chancellors underlines the achievement of successive Prime Ministers in appointing only practising lawyers held in high regard.

It is of course important that when the Lord Chancellor sits as a judge, it should not be in a case in which it would be inappropriate. My noble and learned friend has made it amply clear that he would take great care not to compromise his position in such a way. He has spelled out in this House that he would not sit on any case concerning legislation, in the passage of which he had been directly involved, or in any case where the interests of the executive were directly engaged. The Lord Chancellor would always be greatly concerned that he might render himself ineligible to sit judicially were he to express an opinion on a matter that might later be relevant to an appeal to your Lordships' House. It can be argued, of course, that whatever may have been appropriate in the past, the Human Rights Act now makes it unacceptable that the Lord Chancellor should continue to fulfil his multiple functions. The Government do not accept that. I would point out, first that the only jurisprudence on this subject from the European Court in Strasbourg, the McGonnell case, as mentioned by the noble Lord, Lord Lester of Herne Hill, emphasised that:

The question is always whether, in a given case. the requirements of the convention are met". The court accepted the UK's contention that neither Article 6 nor any other provision of the convention required, states to comply with any theoretical constitutional concepts as such".

Lord Lester of Herne Hill

My Lords, I am grateful to Minister for giving way. Is he aware that experience in the Parliamentary Assembly of the Council of Europe and in the Venice Commission for Democracy suggests that it is almost impossible to explain to lawyers, judges and politicians in the rest of Europe how in Britain alone we retain that curious mixture of the three branches in a single person? Is the Minister aware of the difficulty that the United Kingdom Government will have defending that position on the international plane?

Lord Macdonald of Tradeston

My Lords. the Government are indeed aware of that, which is one reason why I cited Lord Hailsham as well as the matters before me.

It follows that the Government do not accept that the Human Rights Act 1998 causes us to review the role of the Lord Chancellor. If there is a human rights point here—we do not think that there is—it stems from our international obligations, not from domestic legislation. In any case, the Act was intended to work with, not against, the grain of our constitutional tradition. It assumes a settlement in which the judicial, executive and legislative branches of government all have an interest and role. Indeed, it works best if there is mutual respect between those branches, with each understanding the responsibilities given by the Act to the other two. The role of the Lord Chancellor encourages and promotes that.

I turn to the substance of the Bill: the issue of the salary payable to the Lord Chancellor. In principle, the level of ministerial salaries is a matter for the Government of the day. However, as the noble Lord. Lord Goodhart, mentioned. since its establishment in 1971, the independent Top Salaries Review Body, now the Senior Salaries Review Body, has periodically been asked to undertake a review of ministerial and parliamentary pay and allowances. Following the 1996 Senior Salaries Review Body report, the Government of the day now ask the Senior Salaries Review Body to carry out a thorough review about every three years and to make recommendations.

As I outlined, the Lord Chancellor is by statute head of the judiciary. Many of the core functions of his office derive from his being head of the judiciary. In addition to those functions, he is entitled to sit in the Chair of the House of Lords in its judicial capacity. As has been mentioned, the Lord Chancellor's Department has a wide range of responsibilities, employing more than 11,000 staff.

In 1983, the Top Salaries Review Body recommended that, given,

the pre-eminent position of the Lord Chancellor in the judiciary … and his responsibilities as a whole", he should be paid rather more than the Lord Chief Justice. In 1991, that salary linkage was enshrined in primary legislation.

The Bill may be partly in response to the pay rise due to my noble and learned friend this April, following the Government's acceptance of the recommendations on judicial salary made by the Senior Salaries Review Body in February. I recognise that the increase this year is substantial, but it is entirely due to the statutory link between the salaries of the Lord Chief Justice and the Lord Chancellor.

The 12.6 per cent increase arose because the Lord Chief Justice received the 2.75 per cent increase for 2003 given to every member of the judiciary. along with the remaining 4.4 per cent of the staged award for 2002. In addition, the review body recommended a further increase of £10,000 for the Lord Chief Justice to ensure broad comparability with the Cabinet Secretary.

The related statutory pension entitlement of the Lord Chancellor is based on his salary entitlement on retirement. That, too, has caused some comment in your Lordships' House, which the noble and learned Lord, Lord Mackay of Clashfern, tried to set in context. To repeat, it is necessary for a new Lord Chancellor to retire from legal practice prior to assuming the office.

However, the other matter to which the noble and learned Lord referred is surely fundamental to the debate and must be considered. Unlike any other Cabinet Minister, by convention, Lord Chancellors may not return to legal practice upon retirement. Thus, Lord Chancellors lose their livelihood, regardless of the length of time for which they may occupy the office. That is surely a crucial concern—one that has no doubt dictated the enduring all-party acceptance of the pension arrangements first set up in 1831 but now being called into question in some quarters.

The Senior Salaries Review Body said in its February report that it would review the broad linkage between judicial and Senior Civil Service salaries. That is needed because performance-related pay plays an increasing part in the salaries of the latter but not the former. The Lord Chancellor subsequently asked the Senior Salaries Review Body to review the statutory link between his salary and that of the Lord Chief Justice. While the review body considers the matter, my noble and learned friend has volunteered to forgo the majority of his pay rise. Instead he will accept an increase of 2.25 per cent in line with the award received by other Ministers.

The noble Lord's Bill would remove the link between the salaries of the Lord Chief Justice and the Lord Chancellor. It would set the Lord Chancellor's salary at the same level as that of a Secretary of State. It is surely clear to everyone who listened to the powerful arguments of the noble and learned Lord, Lord Mackay of Clashfern, that the Lord Chancellor's role is singular, as I briefly touched upon.

In conclusion, in the light of the work being done by the review body, which we expect to receive early in 2004, the Government believe that it would be premature to amend the legislation on the Lord Chancellor's salary before the review body has had a chance to report.

3.26 p.m.

Lord Goodhart

My Lords, I am grateful to everyone who spoke in this debate. I am particularly grateful to the noble and learned Lord, Lord Mackay of Clashfern, who contributed much, as I hoped he would, by presenting a closely argued view that was opposite to mine and that of my noble friend. I regret that we heard no comment whatever from the Conservative Front Bench, although a Minister has been present. I would have thought it appropriate that the view of the Conservative Party, which may or may not be the same as that of the noble and learned Lord, should be expressed.

I wish to say something slightly different from what my noble friend Lord Lester of Herne Hill said. I do not intend to argue that the Lord Chancellor's current salary involves any unjust enrichment. The real problem is not that his salary is too high but that Cabinet Ministers' salaries are too low given the enormous responsibility that they bear. I would be more than happy if the salary of the Secretary of State were increased to that of the Lord Chancellor. Obviously, a link to the salary of the Lord Chief Justice would still be inappropriate. The problem is the disproportion between the salary of the Lord Chancellor and those of Secretaries of State.

The conclusions of the noble and learned Lord, Lord Mackay of Clashfern, proceeded by irrefutable logic from what I believe to be a false premise—that the Lord Chancellor can be regarded primarily as someone who holds judicial office. That is nominally correct. As the noble and learned Lord pointed out, the Lord Chancellor swears a judicial oath and is entitled to sit as a member of an Appellate Committee of your Lordships' House both during and after his period of office. When the noble and learned Lord, Lord Mackay of Clashfern, was Lord Chancellor, the position may have been closer to a judicial office. He had not served in political office and his involvement in political issues and in the Cabinet was undoubtedly much less than that of the noble and learned Lord, Lord Irvine of Lairg. In a sense, the noble and learned Lord, Lord Mackay of Clashfern, could have been regarded as sitting in the Cabinet as a representative of the judiciary. At present, however, that is not the case.

The Minister referred to the fact that, in this country, we do not have a constitutional separation of powers in any true sense. Some of us feel that that is unfortunate. Although the entwinement of the legislature and the executive is so fundamental that it cannot be changed, that is not necessarily true of the relationships between the judiciary and the executive.

The argument that the Lord Chancellor's role in Cabinet is to fight for the independence of the judiciary and, in some sense, to act as its representative in Cabinet is not and, what is more, cannot be true because of the doctrine of collective Cabinet responsibility, apart from anything else. The Lord Chancellor cannot speak out outside the Cabinet Room against decisions that might threaten the independence of the judiciary, unless he is prepared to resign. It has become increasingly clear in recent years that the Lord Chief Justice, who is freer to speak his mind, is the true representative of the judiciary, not the Lord Chancellor.

The noble Lord, Lord Macdonald of Tradeston, used the argument that sitting as a judge gave the Lord Chancellor practical experience of the exercise of judicial functions. All I can say is that sitting in one case in two years cannot do that. The burdens on a Lord Chancellor, with the increase in the role of the Lord Chancellor's Department, are so great that it would be impossible for any future Lord Chancellor to sit regularly in an Appellate Committee of your Lordships' House, in the way in which, until relatively recently, that was commonly done.

It was argued that the Lord Chancellor's inability to return to practice was an argument for the present level of salary. I deny that. It may be regarded as the reason why the Lord Chancellor is entitled to a full pension for however long he served in the office, but it is not an argument for a higher salary. Apart from anything else, a retired Lord Chancellor can sit as a member of the Appellate Committee, either as a Law Lord, as Lord Dilhorne did, after he ceased to be Lord Chancellor, or on an ad hoc basis, for which he is entitled to draw salary. Furthermore, a retired Lord Chancellor can sit as a commercial arbitrator, as do many other retired senior judges. Those arguments against the Bill are not justifiable.

I recognise that the Bill is unlikely to become law, but it is, nevertheless, wholly justifiable. For the first time since the Lawrence committee in 1963 and 1964, there is an opportunity for the Senior Salaries Review Body to consider whether there should be a change in the basis on which the Lord Chancellor is paid. It is clear from the 1983 report to which my noble friend referred that the question was not considered on the basis of whether the distinction was justified; it was simply an examination of what the difference in salary levels should he.

As a contribution to further debate, I wish to move the Second Reading of the Bill.

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

House adjourned at twenty-five minutes before four o'clock.